HC Deb 26 June 1974 vol 875 cc1556-62
The Secretary of State for Industry (Mr. Anthony Wedgwood Benn)

I will, with permission, Mr. Speaker, make a statement on Court Line Limited.

As the House will know, Court Line, which owns shipyards and Clarksons and Horizon Tours, has approached the Government for assistance to deal with financial difficulties which might have threatened employment in the shipyards and the order book for ships and the many hundreds of thousands of people now booked to go on holiday tours this summer.

The Government are ready to acquire the entire shipbuilding and ship repairing interests of Court Shipbuilders and consider that this should stabilise the situation in respect of Court Line's interests, including the holidays booked for this summer. Further details are being worked out, and I will make a fuller statement as soon as possible.

Mr. Heseltine

Mr. Speaker—[Interruption.]

Mr. Wellbeloved

On a point of order, Mr. Speaker. If the hon. Gentleman has lost his voice, would it not be appropriate for you to call somebody who has a voice?

Mr. Speaker

I sometimes wish that some other hon. Members would lose their voices.

Mr. Heseltine

I think, Mr. Speaker, that it would be a pity if I had to shout about a matter as serious as this. I understand that it is a matter of wild hilarity to some Government hon. Members, but I do not wish to indulge in that method of treating the House.

My right hon. Friends and I regard it as extremely unsatisfactory that a statement of this sort should be made with so few details, and, obviously, we shall wish to reserve our position until a further statement has been made. However, there are two serious points upon which I wish to press the right hon. Gentleman further. First, he will understand that amongst the difficulties facing the company there are a number of general problems facing all British industry, many of which are associated with the Budget which was introduced by his right hon. Friend the Chancellor of the Exchequer, which has adversely affected the cash flows of British companies. Secondly, there is the total inability of any company today owning assets which are invested in any of the industries threatened with nationalisation to negotiate any form of settlement with outside companies which might bring a rescue operation to the company concerned. Will the Secretary of State now come clean and admit that we have the first example of a squeeze operation and that he has grabbed this opportunity to take this company into public ownership?

Mr. Benn

I shall first explain why the statement was made in this form. We have been in consultation with the firm at its request. It was thought right that holidaymakers who had holidays booked this summer should have some reasonable security, and the Government were anxious to help them. The hon. Gentleman will know that Horizon Tours and other tour operators ran into difficulty when the previous Government were in office.

What we are proposing to do is to bring into public ownership 16 companies that are owned by Court Shipbuilders, using legislation that the hon. Gentleman and his right hon. Friends put on the statute book. We propose to do that in consultation with the firm and in a form that is completely agreeable to the firm, thus saving £133 million of shipbuilding orders and the jobs of 9,000 workers in development areas, making possible the completion of £48 million worth of expected further orders and safeguarding the holidaymakers. We propose to use the previous Government's legislation in that way. If that is unacceptable to the hon. Gentleman, will he please tell the House why.

Mr. Willey

Is my right hon. Friend aware that management and workers equally are immensely indebted to him for the prompt way in which he has acted to save their livelihood? Will he further underline that it was Court Line Limited which pressed upon him the nationalisation of the shipyards? Does he agree that that makes absolute nonsense of what British shipbuilders have been saying in their propaganda and what was said in the House last week?

Mr. Benn

I am grateful to my right hon. Friend not only for his comment but for the representations that he made on behalf of workers in his own constituency, along with other hon. Members, about the safeguarding of jobs. I should also tell the House that before making a statement I sought the advice of the CBI and the TUC. Without conveying any confidential information, I sent to the TUC the latest annual report of the company and the Press cuttings. The TUC asked me to try to safeguard the jobs in the shipyards. The CBI felt unable to make a recommendation. Speaking personally, I am fed up with weekend speeches attacking public ownership and then the queueing up at the back door for support when companies are in trouble.

Mr. Thorpe

Is the right hon. Gentleman aware that some of us feel that the Government have no alternative but to act in the way they have done? As one of the shipyards—namely, Appledore—is in my constituency and I therefore have some knowledge of it, will the right hon. Gentleman confirm that the problems of Court Line have not been caused by financial difficulties in any of its shipyards? Does he agree that labour relations, the record of production, and the fact that they were the first covered yards in Europe all show that they are valuable shipyard enterprises which should be kept in being and that they are a model to shipbuilding in many other parts of the United Kingdom?

Is the right hon. Gentleman aware of the similar experience of the Bideford Shipyard on Torridgeside, when, on the bankruptcy of one of its parent companies, workers had a work-in for no pay until a new buyer could be found?

What are the right hon. Gentleman's future intentions? [HON. MEMBERS: "Too long."] It is not too long in the minds of my constituents whose employment is involved. Will it remain a fully nationalised firm? Alternatively, will the Government adopt the BP solution with a percentage of Government shareholders on the board, or will they work towards a Bideford Shipyard solution and hope that a private buyer will be found? Everyone, whatever his status in shipbuilding, would like more detail about the future that the right hon. Gentleman has in mind.

Mr. Benn

I remind the House that the statement I made was a preliminary one for the reason I gave. I said that the Government were ready to acquire the entire shipbuilding and ship repairing interests.

The right hon. Gentleman can reassure his constituents that Appledore is safe as a result of the public ownership that will be brought about if these arrangements are concluded by a Labour Government. Perhaps he will convey that message to his shipyard. I might add that the right hon. Gentleman could have prepared his constituents for the merits of this solution more carefully than he has perhaps done. These measures will help the shipyard in his constituency. It is not our intention, having acquired the interests, if the acquisition goes through by consent under Conservative legislation, to sell them off later to any private owner.

Mr. Bagier

Is my right hon. Friend aware that the 8,000 or 9,000 workers in the shipyards, ship repair yards and marine engineering yards in the North-East will welcome his speedy action and his statement? Will he give an undertaking that the modernisations which are taking place and which will result in the largest indoor shipbuilding complex in the world at Doxford's in Sunderland will go ahead? Will he also tell the management that it may proceed with its negotiations with the staff, which are reaching a rather delicate stage which should be completed by Friday? Will he give the workers an assurance that their financial future will be secure so that there will be no possibility of industrial strife?

Mr. Benn

I know the point which my hon. Friend raises because he raised it with me personally. The statement I made today is a holding statement designed mainly to reassure my hon. Friend's constituents and other shipyard workers and holidaymakers. As at this moment, the ownership of Court Shipbuilders remains with Court Line and must do so until the negotiations are completed.

As a result of the action that we are ready to take, which has had the broad assent of the company concerned, security of employment will be strengthened. Shipyard workers have suffered too long from bad management, becoming the victims of financial manoeuvres of one kind and another.

Mr. John H. Osborn

I accept that in these circumstances the Government had no alternative but to take this decision. But will the Minister bear in mind that price control, with wage inflation continuing, may cause many other companies to be in the same predicament, and that to move the financial centre of the country from the City of London to Whitehall would be a disaster?

Mr. Benn

The hon. Gentleman has raised a much wider question. I think he will recognise that the energy crisis, with the resulting high rise in air fares, has had effects upon holiday organisations which run charter flights, which put them in a wholly different category from the broader considerations he mentions. I shall be happy to discuss the other matters with the hon. Gentleman. In these circumstances, there is no doubt that we were right, just as, in similar circumstances, the Conservatives would have nationalised 16 companies with no less hesitation.

Mr. Sedgemore

Is my right hon. Friend aware that a considerable number of people in Luton work at the airport for Court Line? What will be the future of Court Line's aviation services? Will he urgently see a deputation from Luton to discuss plans for workers' control which have already been drawn up for the airport? Against the impending economic crisis and world recession, will not more private firms be asking for Government help, and is not the choice for the people between mass unemployment resulting from Tory policy and full employment resulting from the Government's policy?

Mr. Benn

I agree with the latter part of what my hon. Friend said. On the aviation side, my right hon. Friend the Secretary of State for Trade is the Minister responsible, as indeed he is on the holiday side, and we have been working together on this problem. But the problem comes back to the Department of Industry in terms of the possible effect of the energy crisis on world airlines and pushes back into the aircraft industry. Several Departments, including the Department of Employment, are involved.

Mr. John Davies

Will the Secretary of State be kind enough to give the House an assurance that, having decided to salvage this series of companies, he will not, following his previous habit, allow shipyards which he has picked up into national ownership to be submerged by inadequacy of management and finance, as in the case of Upper Clyde?

Mr. Benn

The right hon. Gentleman was the personal architect of the legislation which I am using, and I pay a warm tribute to him for making it possible for me to do this. He is also the architect of the legislation that is permitting these yards to continue an active modernisa tion programme. He will know that they are profitable yards that will be a great asset to the public sector.

Mr. Speaker

Mr. Hattersley.

Mr. Michael Morris

On a point of order, Mr. Speaker. The statement made by the Secretary of State for Industry concerns millions of holidaymakers. Not a single question has been asked on the subject of reassuring those holidaymakers.

Mr. Speaker

I have to protect the time of the House. We have spent 20 minutes on the statement. We have another statement which will take a considerable amount of time, we have to discuss a Ten-Minute Rule Bill and there is a Supply Day debate to which I understand the Opposition pay great importance. I must protect the Business of the House. Mr. Hattersley.