§ 21. Mr. Norman Lamont
asked the Secretary of State for Trade and Industry why he referred the bid by Tarmac for Wolsely-Hughes to the Monopolies Commission.
§ Mr. Peter Walker
Because the bid was within the scope of the Monopolies and Mergers Act 1965, and I considered a full investigation to be justified.
§ Mr. Lamont
While I appreciate that this bid, like many bids, was opposed by employees and management, may I ask my right hon. Friend whether he would not agree that some uncertainty has been caused by the Government's attitude towards conglomerate mergers? Will he give an assurance that conglomerate mergers are not necessarily regarded as undesirable and that opposed bids will not in future be referred simply because they are made by diversifying companies?
§ Mr. Walker
The reason why this bid was referred was not purely that it was an opposed bid. The Government had previously made it clear that we would be using the existing referral power rather more in the future than in the past. A number of arguments were put forward and it struck us as being worthy of a reference to the commission.
§ Mr. Pardoe
Is the right hon. Gentleman aware that some of us are more likely to ask him why he has not referred a matter to the Monopolies Commission rather than to ask him why he has done so? Is he aware that we congratulate him on this reference? Is he further aware that reference alone is not enough? A number of Monopolies Commission reports say that although circumstances in an industry are not now against the public interest they may become so if certain things happen. What process does the right hon. Gentleman have for ensuring that the Department keeps an eye on the changing affairs within an industry?
§ Mr. Walker
One of the advantages of making more references to the commission is that it will build up a considerable amount of information about such mergers and about their effects, economic and social and in every other way. This will enable us to develop long-term strategy.
§ Mr. Rost
If an increased number of such bids are to be referred to the Monopolies Commission, may I ask my right hon. Friend whether there is not a case for decisions to be speeded up so that those in industry and the City can get on with the mergers and takeovers where they are regarded as desirable?
§ Mr. Walker
Yes. That is desirable. There is a problem of the key staff and 975 the qualifications of the staff involved. It would be my objective to try and speed up decisions.
§ Mr. Walter Johnson
Is the right hon. Gentleman aware that the Monopolies Commission should be inquiring into the activities of the building societies?