HC Deb 17 May 1976 vol 911 cc933-5
4. Mr. Nelson

asked the Secretary of State for industry what policy he intends to adopt with regard to the issue of directives to the NEB on the acquisition of profitable manufacturing companies.

Mr. Kaufman

It is a statutory function of the NEB to make such acquisitions. I am very satisfied with the progress that the NEB is making and I do not contemplate giving it a direction on this matter.

Mr. Nelson

How does the Minister reconcile this policy with the very firm rebuttal which his right hon. Friend the Prime Minister gave at the NEC meeting last week to the proposal of the Labour Home Policy Committee to extend public ownership further into profitable sectors of manufacturing industry?

Mr. Kaufman

The hon. Member is giving us accounts of what took place at the National Executive which are not in accord with what took place. In addition, my right hon. Friend the Prime Minister is an outstanding exponent of the policies put through by this Government. One of them is the Industry Act 1975, under which the National Enterprise Board can make investments in profitable private enterprise manufacturing industry, and that is what it will go on doing.

Mr. Heffer

Is my hon. Friend aware that Conservative Members should not always believe what they read in the newspapers about the National Executive? Would he turn his mind to the specific point and say that what is being proposed by the NEB—to extend into the profit-making industries—is as laid down clearly in the Act?

Mr. Kaufman

My hon. Friend was actually present at the National Executive meeting on which the hon. Member for Chichester (Mr. Nelson) claims to be such an expert. The National Enterprise Board has so far taken substantial shareholdings in International Computers and in Brown Boveri Kent. It has other acquisitions in hand which are still commercially confidential.

Mr. Grylls

Can the Minister confirm that the NEB will not be taking over any pharmaceutical companies? Can he give a firm commitment on that point?

Mr. Kaufman

Not at all. If the NEB found that it was appropriate under its functions to enter the pharmaceutical range of industries, that would be a very appropriate thing for it to do.

Mr. loan Evans

Why is it acceptable to the Conservative Party for the NEB to take over unprofitable failures of private enterprise but not the profitable sectors of manufacturing industry? Would my hon. Friend comment on the statement made today that British Leyland, although a failure under private enterprise, has made £14 million pre-tax profits in the first six months of State ownership?

Mr. Kaufman

Just because the Conservatives' only recent act of nationalisation—namely, Rolls-Royce—was an unprofitable company, they seem to have this fixation that public enterprise must always be unprofitable. We intend to disprove that fixation.

Mr. Tom King

Is the new Prime Minister's policy still that of looking for a fixed frontier between the public and the private sectors? If that is so, how can it be achieved if the NEB is allowed to acquire yet more profitable manufacturing companies?

Mr. Kaufman

The Prime Minister has made it very clear that this Government's stand on public enterprise is that contained in the White Paper "The Regeneration of British Industry".