HC Deb 24 April 1978 vol 948 cc977-80
4. Mr. Neubert

asked the Secretary of State for Trade when he next expects to meet the chairman of British Airways.

19. Mr. Terry Walker

asked the Secretary of State for Trade what talks he has had with British Airways about the replacement of its existing fleet.

27. Mr. Rost

asked the Secretary of State for Trade when he expects to approve the proposed aircraft ordering programme of British Airways.

28. Mr. Shersby

asked the Secretary of State for Trade what discussions he has had with British Airways concerning the replacement of the present Trident fleet with aircraft of British manufacture.

The Secretary of State for Trade (Mr. Edmund Dell)

I shall be meeting the chairman shortly. At our last meeting earlier this month, the chairman put forward a proposal for the airline to acquire 19 Boeing 737 aircraft to replace its older Tridents. This proposal is now under consideration by the Government.

Mr. Neubert

When does the Secretary of State expect to respond to that request by British Airways to buy Boeing? In reaching his conclusion, will he take into account the fact that this is a question not just of the immediate £100 million order but of a total fleet strategy at a replacement cost of £2 billion, and that given American ascendancy in the aviation market a transatlantic partnership rather than cross-Channel collaboration might offer the better prospect for Britain? Above all, his decision should be based on the long-term national interest and not on short-term political pressures.

Mr. Dell

I cannot at this moment tell the hon. Gentleman when a decision on this matter will be made. As for the rest of the hon. Gentleman's supplementary question, he has stated many of the considerations that will obviously have to be borne in mind in formulating a decision on this question.

Mr. Walker

Will my right hon. Friend, in the meantime, have talks with the Secretary of State for Industry to make sure that British Aerospace produces the kind of aircraft that British Airways will need in the future, because the jobs of many people in British Aerospace depend on this being so?

Mr. Dell

My hon. Friend will realise that, in formulating a strategy for the future of British aviation, my right hon. Friend the Secretary of State for Industry is necessarily closely involved.

Mr. Rost

Is not the dilemma of the lack of business and orders for the British airframe industry directly related to the previous Labour Government's folly in pulling out of the European Airbus project at the initial stages, when Rolls-Royce was offered participation in the engine and the airframe industry could have had a major stake in it?

Mr. Dell

I do not wish to follow the hon. Gentleman into discussing the history of the British aerospace industry, but in the course of my visits overseas I have frequently been accompanied by representatives of that industry who are busily trying to sell overseas.

Mr. Dalyell

Since a good deal is said about the quietness of the Boeing 737, is my right hon. Friend aware that some of us who travel to the House every week by Trident and have from time to time to go to Brussels by Sabena 737 much prefer the Trident? Can my right hon. Friend say anything about the question of the likely costs of spare parts? What are the facts of the operating costs? Is it not true that, whereas on the assumption of full load operating costs the 737 may seem to have an advantage, in fact, given a 75 per cent. or 80 per cent. full complement, the Trident has something of an advantage?

Mr. Dell

I am sure that the manufacturers of the Trident will be delighted to hear my hon. Friend's comments. But there are certain problems with the Trident at present, and a particular problem that will be coming up in the next few years is the noise made by the Trident and the necessity to move towards quieter aircraft.

The detailed questions that my hon. Friend asks about the likely cost of spare parts and the operating costs are all matters that British Airways has taken into consideration. On the basis of the information that British Airways has provided, the Government are considering this matter.

Mr. Tebbit

Does the Secretary of State agree that the board of British Airways is statutorily bound by the legislation by which it was set up to consider the best interests of the corporation, as it sees them, and that it has done and should continue to do until it receives a directive otherwise? Does the right hon. Gentleman agree that the board's expressed preference for the Boeing 737 implies no criticism of the BAC111, of which it has a large fleet, but rather a preference for an aircraft that is larger than the BAC111 which is available at present?

Mr. Dell

I think that the hon. Gentleman has accurately stated the position of British Airways.

Mr. Walter Johnson

Does my right hon. Friend agree, however, that it is very important that the right decision should be taken? In those circumstances, will he consider covening a conference of British Airways, British Aerospace and Rolls-Royce so that the right decision may be made?

Mr. Dell

It is certainly of very great importance that the right decision should be made. I assure my hon. Friend that all of the three corporations that he has mentioned will be involved and consulted in the process of decision making. I trust that we shall be able to satisfy each of those bodies. But, of course, my hon. Friend will realise that the interests of those bodies do not always coincide.

Mr. David Price

If British Airways does not buy British aircraft or aircraft containing a substantial British content, who else in the world is expected to buy British aircraft?

Mr. Dell

As I said earlier, many people throughout the world are prepared to buy British aircraft. I suppose the same question could be asked about an American purchase of foreign aircraft. We have all welcomed the fact that recently United States Airlines has been prepared to purchase European aircraft. Will any company buy an American aircraft again? The answer is that, of course, they will.