§ The Chancellor of the Exchequer (Mr. Denis Healey)There is one further step which we propose to take to reduce the public sector borrowing requirement in 1977–78. Two years ago the Government rescued the Burmah Oil Company from severe financial difficulties, and as part of a package of support the Bank of England bought Burmah's holding of shares in the British Petroleum Company.
We now propose that the Bank should sell enough of Burmah's former shareholding in BP to leave the total of the Government's and the Bank's holdings at 51 per cent. as against the 48 per cent. held by the Government before the acquisition of the ex-Burmah BP shares. As the House will be aware, these shares are currently the subject of a legal claim by Burmah against the Bank of England. We are advised in the firmest terms that this claim is without merit, but so long as it is being pursued it may prove an impediment to a successful sale. If this impediment is not removed, the Government will sell an appropriate number of their own BP shares, and in due course will make good their holding by securing the transfer to the Treasury of an equivalent amount of the BP stock acquired from the Burmah Oil Company and now held by the Bank of England. So the Government holding in BP will still be 51 per cent.—more than it was before.