§ Mr. EmeryI beg to move Amendment No. 37, in page 4, line 29, leave out from 'loan' to 'or' in line 32.
§ Mr. SpeakerWith this Amendment I suggest that we discuss the following Amendments:
Amendment No. 134, in page 4, line 29, leave out from 'loan' to 'or' in line 32.
Amendment No. 38, in page 4, line 31, after 'acquiring', insert:
'at current market price or at a fair independent valuation'.Amendment No. 39, in page 4, line 40, leave out from 'not' to end of paragraph (4) and insert:'acquire shares or stock in any company incorporated in Great Britain'.Amendment No. 74, in page 17, line 6, leave out paragraph (c).
§ Mr. EmeryWe come now to the method by which the Government can conduct their financing to assist tourism generally. The basis is that it shall be done by grants and loans. The Government have, as so often happens, slipped into the Bill the possibility, with a Socialist Administration, of this being carried forward by the Government acquiring shares or stocks in a company which would participate in a tourist-promoting project. We on this side believe that that is not in the best interests either of tourism or of the country generally. We believe that the loan and grant procedure should be accepted.
We believe, too, that this should not be the only method by which assistance to tourism should be financed. The market is still an acceptable method. If a project is financially viable, it should not have to rest with the Government to carry forward the financing, but ordinary business judgments should encourage such a scheme to go forward.
However, we accept that some schemes may not be able to attract private finance. We do not accept that, if the Government back tourist projects, they should acquire a shareholding in the project. Such an operation could be described as backdoor nationalisation. This is a political 1300 factor. Although most of our proceedings in Committee did not involve a division on politics or political judgment, the Minister of State must realise that this accusation can be laid against him with the Bill as it stands.
We do not believe that these are the type of projects, being in many cases highly risk-bearing projects, in which the Government would want to hold shares or stock. This is the type of business in which it is not really the responsibility of Government to hold shares or stock. Specialist commercial judgment is essential, and considerable risks are likely to be involved. Therefore, it would be absolutely wrong for the Government to be able to take up shares or stock, as the Bill now gives them power to do.
Amendment No. 38 is perhaps a fallback position. Whilst we do not like subsection (2) we must accept the overwhelming power of the Government in the Division Lobbies. They were not always able to maintain this power in Committee, but they can usually do so on the Floor of the House. Therefore, we realise that it is possible that we shall not be able to persuade the House to accept the Amendment No. 37. If that is the case I very much hope that the Government will give us Amendment No. 38, which attempts to set a current market price or fair independent valuation on the stock that might be acquired. It is a proper protection for both the Government and anybody disposing of shares to add to the Bill a phrase which allows the Government to obtain what they want only
… by subscribing for or otherwise acquiring at current market price or at a fair independent valuation shares or stocks …We cannot see any reason why the Government would not want to ensure that they were getting proper value for money in any acquisition, and were not also attempting to obtain a special position by pressing down the value of any holding they might acquire. Therefore, the requirement of a current market price or fair independent valuation is a reasonable and proper addition to the Bill.This addition to grants and loans is completely unnecessary. We believe that it is done purely for political reasons. This is the one place where politics has come into the Bill. It is a pity, and we wish that the Government would have the good sense to delete it.
§ 7.45 p.m.
§ Mr. PeytonIn supporting everything that my hon. Friend the Member for Honiton (Mr. Emery) has just said I should like to apologise to my hon. and right hon. Friends on behalf of my hon. Friends and myself who put down Amendment No. 134 for the fact that it is identical with the Amendment we are now discussing. My only excuse is that owing to the fragmented state of the Order Paper it is sometimes difficult to realise what Amendments have already been put down.
My hon. Friend is entirely right. The part of the Clause with which we are concerned is very objectionable, and I hope that we shall have a rather more satisfactory reply from the Government than we had by way of explanation so far to some of the more offensive sections of the Bill.
We are told:
A Tourist Board shall have power—This can be given by means of the board's acquiring shares. I do not wish to be offensive to anybody, but I feel obliged to say in the public interest that the relevant Ministers and the Treasury seem to have an almost unerring sense for selecting sure-fire losers and investing public money in things which cannot possibly do very well. It is most unlikely that really winning projects would be prepared to sell a large part of their equity to the Government. Therefore, I feel that the boards, unleashing their new-found enthusiasm for their public duties, may well be tempted, and the Treasury with them, to invest their money in things that they should never go into, and which in the end will prove to be sources of loss and failure.(a) in accordance with arrangements approved by the relevant Minister and the Treasury, to give financial assistance …I have always felt that if only one could persuade the Government to lend one £5 to dig a hole in the road for no particular purpose it would be very easy to oblige them thereafter to lend one £500,000 before they finally decided there was no purpose whatever in digging the original hole. It takes a long time before a Government are prepared to lose face by admitting they were wrong and writing off their original investment.
The tourist industry is highly speculative and needs people who are prepared 1302 to risk a good deal to go into it. I am all for giving them the maximum of encouragement, but I do not believe that it is right in any way that we should contemplate the injection of public money in the form of equity capital. I look askance at loans and grants, but to me the idea of equity capital is totally wrong.
I very much hope that the Government will not think that we are just prosecuting a bigoted and party view here. Besides agreeing entirely with everything my hon. Friend said, I applaud the rather more modest alternative he has expounded by way of the accompanying Amendment. But I would much rather stick on the first one and register the fact that we on this side of the House take rooted objection to the Government's proposal.
§ Sir C. TaylorI apologise to my hon. Friend the Member for Honiton (Mr. Emery) for not being here to move the Amendment as I had promised. I went out to have a word with a constituent who sat through all 18 sittings of our Committee and the proceedings yesterday until the early hours of this morning, and who has been sitting through today's proceedings and is determined to see them out. I did not realise that the previous group of Amendments would fall so quickly.
These Clauses were not discussed very fully in Committee. We feel that the B.T.A.—I hate the name "British Tourist Authority" so I shall go on using the initials—should not purchase shares in businesses, because this Bill is primarily designed for grants and loans. Grants are money given away; loans are presumably for a short term. Surely the B.T.A. is not supposed to tie up taxpayers' money in what may be long-term proceedings. They may involve very long-term investments. The B.T.A. should not engage in this sort of transaction.
For example, the B.T.A. may be left if it indulges in this sort of thing, with a large minority shareholding which it cannot get rid of because the concern has become a white elephant. It might and itself, as people do sometimes when they invest as a minority shareholder, that the only way to get its money back 1303 is to become the majority shareholder—and again it still may be a white elephant. We do not believe that this is part of the functions of the B.T.A.
If we succeed with Amendment No. 37, we shall not need Amendment No. 38. But if we do not, then Amendment No. 38 is concerned that investment by the B.T.A. in a company should be at the current market price or at a full independent valuation. If the B.T.A. is permitted to make an investment in a company which sells its shares to the B.T.A. under duress, it would be bad for the seller. For instance, a hotel keeper, not knowing where he is going to get sufficient money to carry on, receives help from the B.T.A. on condition that it takes some shares in his concern. That is really a forced sale and the shares may be bought too cheaply. On the other hand, if it is not a forced sale under duress, the B.T.A. may be so led astray by the attractiveness of the operation that it pays too much of the taxpayers' money for the shares.
Both these courses are undesirable. The first might be very bad for the seller and the other might be very bad for the taxpayer, and I cannot understand why the Minister of State would not accept the principle of the current market price, if quoted on the stock market, or a fair independent valuation.
I turn now to Amendment No. 39. If shares in a company are required by the B.T.A. then, if those shares are eventually resold, they should be offered back to the original vendor first, who, after all, may have found himself obliged to sell the shares to the B.T.A. in the first place because he could not get money from other sources. They should not be sold perhaps to a competitor or, if on the open market, eventually find their way to a competitor. For example, if they were sold on the open market, a merchant banker representing the interests of a large interested group might say, "I should like these shares and then I will offer them to the group." The original vendor would then find himself in an invidious position. Having agreed in good faith to the B.T.A. taking shares in his business, at some later date he might see them possibly falling into the hands of a competitor rather than being offered back to him at a fair price.
1304 The Amendments are inter-linked. If we are fortunate in being successful with Amendment No. 37 and the Minister gives way to us on it, probably the other two will not have to be proceeded with.
§ Mr. PardoeI do not have any great principal objection to the proposal that the Government are making in this Clause and therefore I cannot support the Amendment. The hon. Member for Eastbourne (Sir C. Taylor) distinguished between grants and loans, saying that grants do not have to be paid back. There is a provision in the Bill referring specifically to the repayment of grants.
§ Sir C. TaylorThat is true. We debated it fully in Committee and received certain assurances. I did not want to delay the House on that point.
§ Mr. PardoeI drew the hon. Gentleman's attention to it to show that, while he is not quite right in making a clear distinction between grants and loans, I do not see the clear distinction which the Opposition are trying to draw here between grants, loans, and equity stake. I am not sure that the Government should be precluded from taking an equity stake in certain very large projects. Society ought to have a share in the profits of an enterprise if it invests in it. I emphasise "profits" because all too often, as the hon. Member for Yeovil (Mr. Peyton) pointed out, society tends to get a share of the loss. If he is right in saying that the Government schould not take shares in any project which will make a loss, he is also right in saying that the Government should not make a loan or grant to a project which is going to make a loss.
If Newquay Urban District Council were to take a share in the equity of a new indoor swimming pool or a new conference hall, I, on behalf, I am sure, of the whole tourist and travel industry of Newquay, would welcome that move. I would welcome any move which got us an indoor swimming pool or conference hall. So I do not see the great distinction which the Opposition are trying to draw here.
Perhaps the Minister of State will tell us what equity he envisages the board taking. The Bill leaves the matter open as drafted. Are the Government thinking in terms of 51 per cent. or 60 per cent. or even of only 20 per cent.—as for instance, a grant might be?
§ 8.0 p.m.
§ Mr. BiffenThe hon. Member for Cornwall, North (Mr. Pardoe) very reasonably queried whether it was an acceptable proposition that where public funds are being committed there should be a public stake in the equity, possibly a public director on the board. I would not dissent from his observations. This Amendment removes from the Clause the consummation of financial commitments. If loans and grants are to be extended on a substantial scale, then the logic of the situation would require some participating share in the equity and some representation on the board of management. By moving the Amendment my hon. Friend the Member for Honiton (Mr. Emery) is attempting to de-fuse the financial implications of a good deal of the Bill. In that sense I am delighted to accept his proposition. I trust it will be put to the vote and I shall march through the Lobbies in support of my hon. Friends—I nearly always do.
There are three small subsidiary points about the Amendment I want to consider. I will relate them to the almost contemporary circumstances of some other aspects of Government. The first is that we know that any commitments in the form of shares, presumably booked from the National Loans Fund, is a commitment which now has to be matched by taxation. That is clear from a reading of the Letter of Intent; it is clear from the monetary policy now being pursued. Therefore, what the Clause invites the electors of Oswestry to do is to become captive shareholders by virtue of their position as taxpayers. What the Amendment seeks to do is to give them the option to be free men and free shareholders.
My second observation is to do with the other precedents we have of Government involvement in equity which, as my hon. Friend the Member for Yeovil (Mr. Peyton) and the hon. Member for Cornwall, North have said, are not a happy augury. We debate this under the shadow of decisions on Upper Clyde Shipbuilders. There is an example of an enterprise which has attracted Government equity. With that experience in mind I am delighted that there is also a second Amendment relating to the valuation of any shares. I say this not so much out of a protective sense for the private interests 1306 affected, but out of concern for the taxpayers putting up the money.
My third point is that once we have a hotel industry with shareholdings, be they minority or otherwise, held by the State or by some public body, then almost inevitably this will invite the almost insatiable appetite of Mr. Charles Villiers of the I.R.C. The next thing we will find is that there will be a rationalisation scheme for the hotel industry. If it can deal with bacon-curing what can it not deal with? So we will find that innocently, we have countenanced a set of proceedings the consequences of which would truly frighten us. I congratulate my hon. Friend the Member for Honiton upon moving the Amendment, and I am delighted to feel that this fight is taking place on an issue of substance.
§ Mr. Eldon Griffiths (Bury St. Edmunds)Like my hon. Friend the Member for Oswestry (Mr. Biffen) I have great pleasure in supporting this intelligent and obviously much-needed Amendment. I cannot imagine why my Front Bench is supporting the principle of this Clause.
§ Mr. Deputy Speaker (Mr. Harry Gourlay)Order. I hope that the hon. Gentleman will relate his remarks to the Amendment. We are not discussing the principle of the Clause.
§ Mr. GriffithsI shall be at pains to remain carefully within the rules of order. I put my name to Amendment No. 134, in the name of my hon. Friend the Member for Yeovil (Mr. Peyton), because I do not think that it is the business of any public board to be buying up equities in a private company, a hotel or anything else. I do not understand why my own Front Bench is not ardently espousing this Amendment.
§ Mr. GriffithsSplendid. In that case I apologise to my hon. Friends.
§ Mr. PeytonPerhaps I could help my hon. Friend. I drafted and put down this Amendment which my hon. Friend was good enough to support. I have already explained to my hon. and right hon. Friends on the Front Bench that I did so at a time when due to the fragmentary state of the Order Paper, I was unaware 1307 that they had tabled an identical Amendment.
§ Mr. GriffithsI am pleased and relieved to hear that. Virtue is indeed triumphant on the Opposition Front Bench. May I, with renewed vigour and confidence, support the Amendment in the knowledge that we are marching together as a united party to sustain it.
I support the Amendment for three reasons. First, because we now know from experience that public appointees sent into the board rooms of private companies interfere with the proper management of those companies, frequently beyond the number of shares they represent, because it is inevitably supposed that the man representing the Government or public interest, sitting in however low a chair at the table, has some special knowledge or power deriving from his position.
It is a common experience that those other directors tend to look to the Government-appointed director to see which way he will vote and express himself on a point of policy. That is wholly wrong. The object of a board ought to be to seek to make a profit for its company. Far too frequently Government directors are more concerned not with the profitability of a company, but with representing the point of view of the Government or the public board which has appointed them. That point of view does not always coincide with the needs of the company to make a profit here and now.
§ Mr. William RodgersWould the hon. Gentleman give one or two brief examples of what he has in mind, of public directors in private companies behaving in the fashion which he has suggested?
§ Mr. GriffithsI am putting to the Minister a general proposition. If I had the time I should be delighted to document what I am saying, by reference to the affairs of a number of companies. I am thinking of the activities of some of the oil companies—I go no further than that—on matters of international policy, which I should be happy to document at some length if the Minister wished me to do so. However, my general point is, I think, sufficient.
The interests of directors appointed by shareholders to make a profit for the 1308 firm are not always the same, unhappily, as the interests of public directors who are bound to reflect the policies of the Government or State board by which they were appointed. Often they interfere in a fashion which is not helpful to the activities of the company. Their objectives are frequently different. They are bound by what Ministers say in this place, and any director who is bound hook, line and sinker by the statements of right hon. and hon. Members opposite will, by definition, not be in a position to serve the interests of shareholders as intelligently as other directors who are not so bound.
I have doubts about the simple competence of directors appointed from State boards and the public sector. The great advantage of a private director is that often his own money is involved. Therefore, he is concerned to ensure that the company is managed efficiently and that a profit is made. There is a very considerable difference between such a director and a director who has been provided, as can happen, with a job as one of the boys. I support the Amendment on the point of principle, too.
I deal with the most interesting point made by my hon. Friend the Member for Oswestry. He said that he thought that it was perhaps a logical extension of the principle that public money should be lent to private companies that they should want some part of the equity and representation on the board. No doubt it is a logical extension, but I am not sure that it is invariably the case. For example, most private banks lend money at risk to private companies, but they do not insist on taking up the equity or on having membership on the board, because they act on a basis of trust and profitability.
§ Mr. PardoeI am not sure what the hon. Gentleman means by "private banks". A very large number of finance houses and merchant banks are doing just that and are putting their own nominees on the board.
§ Mr. GriffithsThat is up to them; they must make their own commercial judgment. However, it is not necessarily a logical extension of the principle. Therefore, I would not support the Clause on the ground that it is a logical extension of the lending of public money. On the 1309 contrary, I prefer the Amendment simply because it is enough that a loan is made. It is not necessary to extend the principle to taking up the equity and membership of the board of the company.
There is no doubt that the Amendment would prevent three things which we on this side of the House believe should be prevented. First, it would prevent a further proliferation in jobs to be virtually passed out by State boards. We on this side of the House are pledged when we become the Government to stop the proliferation of jobs provided by agencies of this kind. Secondly, the Amendment would prevent a certain increase in Government interference in the activities of private companies. Again, we are pledged to reduce such Government interference. In a word, it is—and I realise that this is a cliché, but it is a good one—a form of back-door nationalisation. The Bill is full of back-door nationalisation, but I should be out of order if I were to deal with that.
By our Amendment, we would resist these wholly bad tendencies which are widespread in our country. I hope that the Minister will recognise the force of the arguments put to him, withdraw his objections and accept the very sensible Amendment so unitedly supported on this side of the House.
§ 8.15 p.m.
§ Mr. JoplingI should like to say why I am most unhappy about the part of subsection (2) which allows the board to take up shares.
Many hotels in my constituency are owned, not by companies incorporated in Great Britain, but by private people. One problem which I can foresee arising is that the board will be tempted to advance money to a company rather than to a private individual or family business. There may be attractions in lending money to a company rather than to an individual. One can easily cite examples of that. There may be a greater possibility of profit from a company. The books and accounts of a company may be more up to date and better put together than those of a business controlled by an individual or family.
If subsection (2) is not amended, I can visualise constituents of mine who run small family businesses coming to me and saying, "We cannot get any money under 1310 the Bill as the board is anxious to lend money only to companies because it can take up shares". This subsection could become the big man's charter, the company's charter. It might well act against the small family hotels which are in such profusion in my constituency.
Although I am not happy about giving money away in these circumstances, as I said on Second Reading, if the Government are determined to give away money, I am the last person in the world to deny it to my constituents. But if money is to be scattered about—and I am very dubious about it—we should not create a situation in which the body giving or lending the money is tempted to give it or lend it to the big organisation rather than the small individual or family hotel business.
For that reason, which could bring the whole organisation into disrepute and act against the small man who is the backbone of the tourist industry, I support the Amendment, and I hope that the Government will accept it.
§ Mr. William RodgersI hope that I shall be popular with the Opposition as a result of what I am about to say. I think that my remarks will enable them to go through the Lobby united and cheerful, as I am sure they would choose. I have virtually no sympathy with what has been said by hon. Gentlemen opposite. I except from that the notable contribution of the hon. Member for Cornwall, North (Mr. Pardoe), which was shrewd in every respect. I wished at the time that he could have spoken at greater length, because his was a helpful speech. It distresses me to see hon. Gentlemen who have approached the Bill in an open and honest way now becoming doctrinaire and narrow in their approach. I suppose that it had to happen some time and I therefore shall not go away with too great a sense of grievance.
The hon. Member for Oswestry (Mr. Biffen) made a typically robust speech. He is consistent in his view of what Government intervention is proper. I shall be interested to see his reaction when, looking some time ahead, the I.R.C. is still going about its way doing useful work. He will still be complaining about it.
Before you declare me out of order, Mr. Deputy Speaker, I go on to say that I was most impressed by the arguments 1311 of the hon. Member for Yeovil (Mr. Peyton). With respect, I thought that they were powerful: he thought the danger was that the board would back what he called "sure fire losers". He went on to say that the danger lay in the Government or the boards taking highly speculative risks and making inappropriate gestures. I have some sympathy for this point of view. There are circumstances in which the Government, on investing capital, hope that things will turn out better than objective criteria would lead others to believe that they will. In that sense he has a point.
If we looked at the Clause in a quiet and reasonable way and related it to the projects which we have in mind, there would be more widespread support for it. There are certain circumstances, which we discussed briefly in Committee, in which the availability of equity capital might make a difference. I was asked by the hon. Member for Cornwall, North what share I had in mind. I have no particular share in mind but, broadly speaking, we would think of a minority shareholding, essentially as an investment of public money to get a worthwhile project off the ground.
I am not quite sure whether the hon. Member for Westmorland (Mr. Jopling) clearly understood the provisions of the Clause. There is no question of diverting money which would be available to hotels as loans and grants. This is a provision by which, given all the safeguards of the Bill, some equity capital might become available for projects which would be of great interest to the locality in which they took place. One can imagine many circumstances in which a project is almost off the ground but not quite.
It is true, as the hon. Member for Yeovil suggested, that, if the risk is not too great, private investors should come forward. But private investors are sometimes cautious. The board might decide that an injection of capital would get a project off the ground, and this minority shareholding would bring great benefits to the area. The beneficiaries would be not only those who invested, but small hoteliers as well.
These may be exceptional circumstances. I do not imagine that this will often happen, but it could happen sometimes to the general benefit and in 1312 circumstances which would be acceptable to all, save those who would deny it on doctrinaire grounds.
§ Mr. PeytonThe Minister has said that there are times when private investors will be cautious. In what circumstances can it be justifiable for a Government creature to come forward rashly and invest public money without security? I am unable to identify accurately the safeguards of the Bill to which he refers, but only too often Government safeguards, so-called, are an embarrassment to honest people but are regarded as playful hurdles for crooks to be kept exercised over.
§ Mr. RodgersIt could be argued, and I think the hon. Member for Oswestry would argue, that at any time the provision of grants and loans means taking risks which private investors would not take.
Part II of the Bill makes provision for grants and loans to encourage investment in hotels because investment is not forthcoming. This is a principle which we have long accepted. Sometimes the private investor is not prepared to come forward. Hon. Gentlemen may argue that in those circumstances public authorities should not come forward. I am not accusing the hon. Gentleman of inconsistency, although I accuse some of his hon. Friends of inconsistency. However, with respect to him, it cannot then be said that public funds should be available for grants and loans as they are for the hotel industry. The principle is exactly the same.
§ Mr. BiffenWill the Minister come back to the narrower point about the criteria which would guide the disposal of these funds? Are they to be purely commercial criteria in respect of the tourist industry and tourist prospects, or does the Minister see wider considerations being taken into account, such as those of regional employment and perhaps other considerations?
§ Mr. RodgersThis will depend very much on the circumstances. If we were to say "commercial criteria", it is unlikely that public funds would be required since the likely return on the investment would be of such a level as to attract private funds. No one will be going out of his way to invest public 1313 funds; this will be a stand-by position. We must envisage circumstances in which some private capital becomes available, but the public investment is in terms of a return which is less than private investors might wish to see.
The choice of project might come within the hon. Gentleman's second category. It might be a project which would bring benefit to the area in terms of employment and prosperity, the ripples of which would spread, so that many other parts of the tourist industry would benefit. These are decisions which will have to be made at the time, and within the discretion of the boards.
I am not saying that I envisage that this will often happen. I say, and I rest on this, that we should not be so doctrinaire as to deny the possibility of this being done. This is why I resist the first of the Amendments.
§ Mr. BiffenIf this is money which is to be disposed of on regional employment considerations and at the discretion of the boards, will the boards be given guidance, and will cost-effectiveness be taken into account in the disposal of funds in respect of regional development? The Minister must know perfectly well that hundreds of millions of pounds of public funds are being disbursed in the sacred name of regional development, and we should at least ask what are the standards to ensure that we get value for money.
§ Mr. RodgersThe words "regional development" were used by the hon. Gentleman, not by me. I did not say that the funds would be used for regional development. It might be that the investment of such funds would have consequences wider than the project itself. I hope that no more will be read into my words than that. A balance will have to be struck. Far be it from me to say precisely where it will be. The hon. Gentleman is consistent in his views, and logically he will vote for the Amendments when the time comes. I do not complain about that. I want only to make clear to the House what this standpoint involves.
In regard to the second of the principal Amendments which seeks to ensure that the shares are passed at a proper price, it is clear that there are no powers in the Bill to enable tourist boards to acquire 1314 stocks or shares compulsorily from any company. That being so, shares could pass only if there were a willing buyer and a willing seller. I hope that in these circumstances the hon. Member will recognise that the market is the best way to determine the outcome.
§ Mr. EmeryWith the leave of the House, may I say that I found it particularly discouraging that the Minister began his reply to the debate with accusations that we were being doctrinaire. If ever there was an instance of a doctrinaire approach, it is the Government's approach on the Bill in relation to stocks and shares. We have already made clear that it is quite inappropriate.
I should like to congratulate my hon. Friend the Member for Yeovil (Mr. Peyton) whose argument has been completely unanswered. He said that he had found fundamental difficulty in distinguishing Government safeguards in this matter. As usual he is absolutely right. There are no Government safeguards at all in the Bill.
8.30 p.m.
What worries me is that two points were not taken at all by the Minister. The first is that with the acquisition of shares in this manner there will be a discouragement to the investment of private capital in tasks which are of great risk and which previously have been undertaken by private enterprise. To take the Aviemore scheme as an illustration, it is a scheme that contains no Government capital. It is of a high risk nature, and I believe that it is probably true to say that as yet no profit has been made out of it. I am certain that had the Bill been in existence earlier that scheme would not have gone forward without a Government attempt to take some share or equity in the project. Therefore, it would work in such a way as to discourage private capital, which we think would be wrong.
§ Mr. RodgersIs the hon. Gentleman suggesting that the Aviemore project will be a failure? Is that the implication of his remarks?
§ Mr. EmeryAs usual, the Minister is attempting to put words into my mouth. I said that at the moment it has not made any profit. I am saying that in such schemes with a high degree of risk—and there is a high degree of risk in a project 1315 like Aviemore—private enterprise is less likely to come forward since the Government are being enticed to take a share in everything. We on this side of the House want to see the encouragement of risk capital.
§ Mr. RodgersI should like to get clear the hon. Member's views on Aviemore. I understand he is saying that at the moment it is not a profitable venture. Is he saying that no public capital should go into Aviemore? It would not have been completed without the provision of a ski lift.
§ Mr. EmeryThat is an entirely false point that has nothing to do with the point I am making. Quite apart from the question of the ski lift, the scheme would not have proceeded in the way in which it has if the Bill had been in existence in the manner in which the Government wish to project it.
I turn to the second point which was entirely neglected by the Minister. We believe that the ownership of equity in certain projects which would be allowed under Clause 4 for tourist purposes ought not to be the main purpose of the B.T.A.s. Their main purpose is to get on with the marketing of tourism, to encourage the industry, and to do research into it in order to stimulate tourism, rather than to get into the matter of ownership.
It is interesting to note that right on our own borders the Irish Tourist Board had the powers to acquire equity and to take over ownership of projects. Initially, it had five hotels. It found that those hotels were making a loss. It has sold the hotels and now says publicly that it is wrong, and indeed invidious, for the board in isolation to obtain equity holdings in projects of this nature, mainly because it distracts it from its main consideration, which is the main development of tourism.
§ Mr. W. BaxterDo I understand that the Conservative Party are diametrically
§ opposed to any public money being put into the Aviemore ski-lift project?
§ Mr. EmeryThe point that I was making had nothing to do with the facilities which may exist round Aviemore. Aviemore would not have gone forward if there were not roads there. Is the hon. Gentleman suggesting that the private interests should have participated in road building? That is not the case. Whether there are roads to the ski resorts and to the slopes is equally important—
§ Mr. W. Baxterrose—
§ Mr. William RodgersToo long.
§ Mr. Deputy SpeakerOrder. The hon. Gentleman should not be tempted too far along the path laid by the hon. Member for West Stirlingshire (Mr. W. Baxter).
§ Mr. EmeryI had not intended to be tempted too far along that road, because it would have taken me out of order.
Projects are bound to require supporting facilities, and normally they will be provided by the Government. I believe that that is accepted by both sides. That is all that I will say on the Aviemore project.
I was saying that we have an illustration on our doorstep of a tourist board which had the power to have equity holdings. Having taken those powers, it realised that they were wrong and gave them up. Why we cannot learn even from the Irish at times astonishes me. It is a poor state of affairs.
This is an important aspect, and I must ask my hon. Friends to divided the House and so try to get some sense into the Government's approach on this matter.
§ Question put, That the Amendment be made:—
§ The House divided: Ayes 141, Noes 201.
1319| Division No. 288.] | AYES | [8.37 p.m. |
| Alison, Michael (Barkston Ash) | Bell, Ronald | Brinton, Sir Tatton |
| Allason, James (Hemel Hempstead) | Bennett, Sir Frederic (Torquay) | Brown, Sir Edward (Bath) |
| Atkins, Humphrey (M't'n & M'd'n) | Berry, Hn. Anthony | Buchanan-Smith, Alick (Angus, N & M) |
| Awdry, Daniel | Biffen, John | Bullus, Sir Eric |
| Baker, Kenneth (Acton) | Black, Sir Cyril | Burden, F. A. |
| Baker, W. H. K. (Banff) | Blaker, Peter | Campbell, Gordon (Moray & Nairn) |
| Balniel, Lord | Boardman, Tom (Leicester, S. W.) | Carlisle, Mark |
| Beamish, Col. Sir Tufton | Braine, Bernard | Chataway, Christopher |
| Chichester-Clark, R. | Hunt, John | Pym, Francis |
| Cooper-Key, Sir Neill | Hutchison, Michael Clark | Ramsden, Rt. Hn. James |
| Costain, A. P. | Irvine, Bryant Godman (Rye) | Rees-Davies, W. R. |
| Crouch, David | Jenkin, Patrick (Woodford) | Renton, Rt. Hn. Sir David |
| Crowder, F. P. | Jennings, J. C. (Burton) | Rhys Williams, Sir Brandon |
| Cunningham, Sir Knox | Jopling, Michael | Ridley, Hn. Nicholas |
| Dalkeith, Earl of | Joseph, Rt. Hn. Sir Keith | Rippon, Rt. Hn. Geoffrey |
| Dance, James | Kaberry, Sir Donald | Rossi, Hugh (Hornsey) |
| Dodds-Parker, Douglas | King, Evelyn (Dorset, S.) | Russell, Sir Ronald |
| Doughty, Charles | Lane, David | Scott, Nicholas |
| du Cann, Rt. Hn. Edward | Longden, Gilbert | Sharples, Richard |
| Eden, Sir John | McAdden, Sir Stephen | Shaw, Michael (Sc'b'gh & Whitby) |
| Elliot, Capt. Walter (Carshalton) | McMaster, Stanley | Smith, John (London & W'minster) |
| Emery, Peter | McNair-Wilson, Michael | Speed, Keith |
| Eyre, Reginald | Maginnis, John E. | Stodart, Anthony |
| Farr, John | Marten, Neil | Stoddart-Scott, Col. Sir M. |
| Fisher, Nigel | Maude, Angus | Tapsell, Peter |
| Fletcher-Cooke, Charles | Mawby, Ray | Taylor, Sir Charles (Eastbourne) |
| Foster, Sir John | Maxwell-Hyslop, R. J. | Taylor, Frank (Moss Side) |
| Gibson-Watt, David | Mills, Peter (Torrington) | Temple, John M. |
| Gilmour, Ian (Norfolk, C.) | Miscampbell, Norman | Tilney, John |
| Gilmour, Sir John (Fife, E.) | More, Jasper | Turton, Rt. Hn. R. H. |
| Glover, Sir Douglas | Morrison, Charles (Devizes) | van Straubenzee, W. R. |
| Godber, Rt. Hn. J. B. | Mott-Radclyffe, Sir Charles | Vickers, Dame Joan |
| Goodhew, Victor | Munro-Lucas-Tooth, Sir Hugh | Walker-Smith, Rt. Hn. Sir Derek |
| Gower, Raymond | Nabarro, Sir Gerald | Walters, Dennis |
| Grant, Anthony | Nicholls, Sir Harmar | Ward, Dame Irene |
| Gresham Cooke, R. | Noble, Rt. Hn. Michael | Wells, John (Maidstone) |
| Griffiths, Eldon (Bury St. Edmunds) | Nott, John | Whitelaw, Rt. Hn. William |
| Gurden, Harold | Onslow, Cranley | Wiggin, A. W. |
| Hall, John (Wycombe) | Osborn, John (Hallam) | Williams, Donald (Dudley) |
| Hall-Davis, A. G. F. | Page, Graham (Crosby) | Wilson, Geoffrey (Truro) |
| Hamilton, Lord (Fermanagh) | Pearson, Sir Frank (Clitheroe) | Wolrige-Gordon, Patrick |
| Harris, Reader (Heston) | Peel, John | Woodnutt, Mark |
| Harrison, Col. Sir Harwood (Eye) | Percival, Ian | Worsley, Marcus |
| Wright, Esmond | ||
| Hastings, Stephen | Peyton, John | Younger, Hn. George |
| Heald, Rt. Hn. Sir Lionel | Pink, R. Bonner | |
| Higgins, Terence L. | Pounder, Rafton | TELLERS FOR THE AYES: |
| Hill, J. E. B. | Powell, Rt. Hn. J. Enoch | Mr. Hector Monro and |
| Hordern, Peter | Prior, J. M. L. | Mr. Bernard Weatherill. |
| NOES | ||
| Albu, Austen | Diamond, Rt. Hn. John | Heffer, Eric S. |
| Allaun, Frank (Salford, E.) | Dickens, James | Henig, Stanley |
| Alldritt, Walter | Dobson, Ray | Herbison, Rt. Hn. Margaret |
| Anderson, Donald | Doig, Peter | Hooley, Frank |
| Archer, Peter | Dunn, James A. | Hooson, Emlyn |
| Armstrong, Ernest | Dunwoody, Mrs. Gwyneth (Exeter) | Houghton, Rt. Hn. Douglas |
| Atkins, Ronald (Preston, N.) | Dunwoody, Dr. John (F'th & C'b'e) | Howarth, Robert (Bolton, E.) |
| Atkinson, Norman (Tottenham) | Eadie, Alex | Hoy, Rt. Hn. James |
| Bagier, Gordon A. T. | Edwards, Robert (Bilston) | Hughes, Hector (Aberdeen, N.) |
| Barnett, Joel | Edwards, William (Merioneth) | Hunter, Adam |
| Baxter, William | Ellis, John | Hynd, John |
| Beaney, Alan | English, Michael | Jackson, Peter M. (High Peak) |
| Bidwell, Sydney | Ensor, David | Janner, Sir Barnett |
| Binns, John | Evans, Fred (Caerphilly) | Jenkins, Hugh (Putney) |
| Bishop, E. S. | Evans, Ioan L. (Birm'h'm, Yardley) | Johnson, Carol (Lewisham, S.) |
| Blackburn, F. | Fernyhough, E. | Jones, Dan (Burnley) |
| Blenkinsop, Arthur | Finch, Harold | Jones, J. Idwal (Wrexham) |
| Boardman, H. (Leigh) | Fitch, Alan (Wigan) | Jones, T. Alec (Rhondda, West) |
| Booth, Albert | Fletcher, Rt. Hn. Sir Eric(Islington, E.) | Judd, Frank |
| Boston, Terence | Fletcher, Ted (Darlington) | Kelley, Richard |
| Boyden, James | Foot, Michael (Ebbw Vale) | Kenyon, Clifford |
| Bray, Dr. Jeremy | Ford, Ben | Kerr, Mrs. Anne (R'ter & Chatham) |
| Brooks, Edwin | Forrester, John | Kerr, Russell (Feltham) |
| Brown, Bob (N'c'tle-upon-Tyne, W.) | Fowler, Gerry | Lawson, George |
| Buchan, Norman | Freeson, Reginald | Leadbitter, Ted |
| Buchanan, Richard (G'gow, Sp'burn) | Galpern, Sir Myer | Lee, Rt. Hn. Frederick (Newton) |
| Butler, Herbert (Hackney, C.) | Gordon Walker, Rt. Hn. P. C. | Lee, John (Reading) |
| Callaghan, Rt. Hn. James | Gray, Dr. Hugh (Yarmouth) | Lewis, Ron (Carlisle) |
| Coleman, Donald | Greenwood, Rt. Hn. Anthony | Lomas, Kenneth |
| Concannon, J. D. | Gregory, Arnold | Loughlin, Charles |
| Conlan, Bernard | Grey, Charles (Durham) | Luard, Evan |
| Corbet, Mrs. Freda | Griffiths, David (Rother Valley) | Lubbock, Eric |
| Crossman, Rt. H. Richard | Griffiths, Will (Exchange) | Lyon, Alexander W. (York) |
| Dalyell, Tam | Gunter, Rt. Hn. R. J. | Lyons, Edward (Bradford, E.) |
| Davidson, James (Aberdeenshire, W.) | Hamilton, James (Bothwell) | MacDermot, Niall |
| Davies, Ednyfed Hudson (Conway) | Hamilton, William (Fife, W.) | Macdonald, A. H. |
| Davies, G. Elfed (Rhondda, E.) | Hamling, William | Mackenzie, Alasdair (Ross & Crom'ty) |
| Davies, Dr. Ernest (Stretford) | Hannan, William | Mackenzie, Gregor (Rutherglen) |
| Davies, Ifor (Gower) | Harper, Joseph | Mackie, John |
| Dempsey, James | Harrison, Walter (Wakefield) | Maclennan, Robert |
| Dewar, Donald | Hazell, Bert | MacMillan, Malcolm (Western Isles) |
| McMillan, Tom (Glasgow, C.) | Orbach, Maurice | Sheldon, Robert |
| McNamara, J. Kevin | Oswald, Thomas | Slater, Joseph |
| Mallalieu, J. P. W. (Huddersfield, E.) | Owen, Will (Morpeth) | Small, William |
| Manuel, Archie | Padley, Walter | Spriggs, Leslie |
| Mapp, Charles | Page, Derek (King's Lynn) | Steele, Thomas (Dunbartonshire, W.) |
| Marks, Kenneth | Paget, R. T. | Symonds, J. B. |
| Marquand, David | Palmer, Arthur | Taverne, Dick |
| Mason, Rt. Hn. Roy | Pardoe, John | Thomas, Rt. Hn. George |
| Mayhew, Christopher | Park, Trevor | Thornton, Ernest |
| Mellish, Rt. Hn. Robert | Parker, John (Dagenham) | Urwin, T. W. |
| Mendelson, John | Parkyn, Brian (Bedford) | Varley, Eric G. |
| Mikardo, Ian | Pavitt, Laurence | Wainwright, Edwin (Dearne Valley) |
| Millan, Bruce | Pearson, Arthur (Pontypridd) | Wainwright, Richard (Colne Valley) |
| Miller, Dr. M. S. | Peart, Rt. Hn. Fred | Walker, Harold (Doncaster) |
| Milne, Edward (Blyth) | Pentland, Norman | Wallace, George |
| Mitchell, R. C. (S'th'pton, Test) | Perry, George H. (Nottingham, S.) | Weitzman, David |
| White, Mrs. Eirene | ||
| Molloy, William | Price, Thomas (Westhoughton) | Wilkins, W. A. |
| Morgan, Elystan (Cardiganshire) | Probert, Arthur | Willey, Rt. Hn. Frederick |
| Morris, Charles R. (Openshaw) | Rankin, John | Williams, Clifford (Abertillery) |
| Morris, John (Aberavon) | Roberts, Rt. Hn. Goronwy | Williams, Mrs. Shirley (Hitchin) |
| Murray, Albert | Robertson, John (Paisley) | Willis, Rt. Hn. George |
| Neal, Harold | Rodgers, William (Stockton) | Winnick, David |
| Newens, Stan | Rogers, George (Kensington, N.) | Winstanley, Dr. M. P. |
| Noel-Baker, Rt. Hn. Philip | Ross, Rt. Hn. William | |
| Norwood, Christopher | Rowlands, E. | TELLERS FOR THE NOES: |
| Oakes, Gordon | Ryan, John | Mr. Neil McBride and |
| O'Malley, Brian | Shaw, Arnold (Ilford, S.) | Mr. John McCann. |