HC Deb 04 November 1974 vol 880 cc673-5
10. Mr. Stanley

asked the Secretary of State for Industry what will be the basis of valuation of shares in publicly quoted companies acquired by the National Enterprise Board and in companies made subject to nationalisation legislation.

Mr. Heffer

I must ask the hon. Member to await the proposals that will be put before the House in due course.

Mr. Stanley

Will the Minister at least give a minimum assurance that the valuation of the companies to be nationalised will not be lower than their market valuation on the date on which the nationalisation legislation is published?

Mr. Heffer

I cannot add to what I have said. The proposals will be put before the House in due course.

Mr. Molloy

However, there may rightly be discussions about compensation that might be paid to industries that are taken into public ownership. What is causing more concern among the British public is the vast sums of money being paid to industries which are about to become bankrupt, in order to save them, or which, when they have become bankrupt, come with their begging bowls to the Treasury to be bailed out. That aspect of the question needs emphasising, because it must be part and parcel of public ownership schemes that where public money is used there is a public return.

Mr. Heffer

It has long been the Labour Party's view that when public money is given, in one form or another, there must be public accountability. I assure my hon. Friend that all the points he has made will be taken into consideration in discussions on this matter.

Mr. Hordern

Is it not clear that the capital market is in no state to bear the amount of resources that will be required for the proposals for nationalisation? Is the Minister aware that the Government themselves cannot borrow on any long-term basis at less than 16 per cent.? How do the Government propose to finance the deficit that is bound to occur between the dividend received from the nationalised industries and the interest that will have to be paid on the money borrowed to carry out the nationalisation proposals? How much will that deficit be, and how does the Minister propose that it will be funded?

Mr. Heffer

The hon. Gentleman must await the proposals. I cannot go beyond that at this stage, but I shall make one comment on the hon. Gentleman's statement. From what he said, it would appear that the Opposition have never understood how the publicly-owned industries have been funded in the past. It has been done before, and it will be done again very much on the same lines.