§ Q3. Mr. Lubbockasked the Prime Minister if he will instruct Ministers responsible for publicly-owned enterprises to issue general directions to those enterprises requiring them not to employ United States management consultants.
§ The Prime MinisterNo, Sir. The choice of management consultants by public corporations and nationalised industries is a matter within their managerial discretion.
§ Mr. LubbockWould the Prime Minister publish any representations which he has received on this question from the Management Consultants Association, together with copies of the replies which he or the Governor of the Bank of England may have sent?
Does he realise that the decision of the Bank of England has done grave and irreparable damage to British consultants working abroad whose clients are saying that if even the Bank of England cannot decide to employ British consultants, why should overseas clients do so?
§ The Prime MinisterThere have been representations from the associations concerned. With regard to the Bank of England case, I thought that I heard the hon. Gentleman not only putting questions to my right hon. Friend the Chief Secretary about this matter two or three minutes ago, but intimating that he would raise it on the Adjournment. In these circumstances, I am inhibited a little in replying to his question. Perhaps I should be in order in pointing out that on a number of occasions the Bank of England has employed British firms of management consultants.
§ Mr. ShinwellSurely there is something extraordinary about the situation when the Governor of the Bank of England and his colleagues appoint an investigating body to investigate themselves. Is there not something arbitrary and even prejudiced about this? When I tabled a similar Question to my right hon. Friend, why did he transfer it to the Chancellor of the Exchequer? Why 1110 should a Liberal have precedence over a loyal and devoted supporter?
§ The Prime MinisterMy right hon. Friend's loyalty and devotion have never been in question. His Question was transferred because it related specifically to the Bank of England which is within the jurisdiction of my right hon. Friend the Chancellor of the Exchequer. The Question of the hon. Member for Orpington (Mr. Lubbock) related to instructions to all Ministers responsible for nationalised industries. To go back to the early part of my right hon. Friend's supplementary question, I do not think that there is anything extraordinary about the Bank of England or any other organisation, privately or publicly-owned, calling in consultants to advise on particular matters of management. It is frequently done throughout British industry. If I have one doubt in this matter it is this—and I agree that it is not a matter for giving directions. There seems to be a growing assumption that this firm is the fount of all wisdom, on which I have heard doubts expressed.
§ Mr. MontgomeryIn view of the Prime Minister's great advocacy of backing Britain, should he not practise what he preaches and engage British firms of management consultants rather than overseas firms?
§ The Prime MinisterWe do, and the hon. Gentleman will be aware, although it has been criticised from the benches opposite, of what we have done recently to stimulate the use of consultancy firms in Britain, especially small and medium-sized firms, with Government assistance to that end. The British consultancy firms have double advantage in knowing the terrain better than American firms and, in general, in charging lower fees.
§ Mr. SheldonWhile agreeing that publicly-owned industries have the right to go for the advice that they think best, is my right hon. Friend aware that there is great concern about this matter, because it is held that the Bank of England did not consult British management consultants and selected McKinsey without examining what the other firms could offer to its advantage?
§ The Prime MinisterAs I have said already, on a number of occasions the Bank of England has employed British 1111 firms of management consultants, so it knew what was available. In this case, I understand that it went through the list of possible alternatives. This is the Bank's decision. It is not for me to defend it or criticise it. It is a management matter.