HC Deb 18 June 1973 vol 858 cc22-4
19. Mr. William Hamilton

asked the Secretary of State for Trade and Industry if he will ensure that the investigation into the Lonrho affair will be in public, or that the full report be published.

Sir G. Howe

The investigation by inspectors into the affairs of Lonrho Limited is being conducted under Section 165 of the Companies Act 1948 and takes place in private. As my right hon. Friend has indicated, the reports of such investigations are normally published unless there are substantial reasons for not doing so, such as the risk of prejudicing court proceedings.

Mr. Hamilton

Why cannot we have our Watergate if the Americans have theirs? Will the right hon. and learned Gentleman give an assurance that this report will be published before the General Election, even though it may be designated an obscene publication? What will his reaction be if we say that we shall scrub the Tory face of capitalism by nationalising Lonrho?

Sir G. Howe

The hon. Gentleman is entitled to his epithets and to express his lust for sensationalism if he so desires. This report of the inquiry will be handled in a way appropriate to the circumstances, exactly as I have indicated. The inquiry will proceed and publication will be decided by the same standards as every Government have applied under Section 165 of the Act. That is as it should be, and as it will be.

Mr. Dykes

Does my right hon. and learned Friend agree that the curious thing is that now that the whole subject has been aired again in the media there is an indication of stronger public disquiet about the Pergamon affair than about Lonrho?

Sir G. Howe

As the latest Pergamon report has not been published it would not be right for me to make any specific comment on that.

Mr. Grimond

Will the right hon. and learned Gentleman say whether the procedure allows inquiries into the activities of Lonrho or subsidiaries outside this country, for instance, in South Africa?

Sir G. Howe

The position is that the investigation is primarily into the affairs of the Lonrho Company itself—the London-based holding company. The inspectors have power under Section 166 to inquire into the affairs of subsidiaries to the extent that they consider relevant and necessary for the purposes of investigation into the affairs of the holding company. If a subsidiary is based abroad, inspectors can pursue inquiries into that subsidiary, but the jurisdiction that they can exercise does not extend outside the territory of this country. Thus, in so far as they make inquiries abroad, it will not be possible to compel witnesses to attend or to command the production of books and papers. They can question those directors of a subsidiary who are directors of the London-based board about the affairs of both companies.

Mr. Benn

Is not the case of Lonrho totally different from some technical inquiries that have taken place in the past, in that the Prime Minister denounced the company before the inquiry was set up? Is it not important that the public at large, including shareholders, should know what went on in Lonrho and why the Prime Minister denounced the company? In those circumstances, a long private inquiry with no certainty of publication at the end would totally fail to erase the anxiety that has been aroused by the Lonrho case and, as has quite properly been said by the right hon. Gentleman, could extend into many other companies.

Sir G. Howe

In considering the question of publication, when that question comes to be decided whoever is then responsible for that matter will consider the issues raised by the right hon. Gentleman and, manifestly, as the shape of the statute makes clear, there is a public interest in the publication of reports of this kind. Clearly, the factors mentioned by the Prime Minister demonstrate the nature of the public interest, but it would not be right, in advance of completion of the inquiry, to conclude that in all circumstances public interest should be allowed to override the other matters that I mentioned in my original reply to the hon. Member for Fife, West (Mr. William Hamilton).