New Clause 12

HC Deb 11 February 1980 vol 978 cc1149-81

FOREIGN INVESTMENT LIMIT

1. (1) The Secretary of State shall by order made by statutory instrument fix a limit for investment by non-United Kingdom residents (the foreign investment limit) in the successor company.
2. (2) Any issue or transfer of shares which would cause the foreign investment limit to be exceeded shall be void and any moneys paid pursuant to such issue or transfer shall be recoverable as an ordinary debt.
3. (3) The foreign investment limit shall be expressed as a proportion of the voting rights exercisable at general meetings.
4. (4) The powers under paragraph (1) above shall not be exercised so as to fix the limit above 15 per cent.
5. (5) In this section "investment" means the legal ownership or ownership through nominees.'.—[Mr. Austin Mitchell.]

Brought up, and read the First time.

Mr. Austin Mitchell (Grimsby)

I beg to move, That the clause be read a Second time.

Mr. Deputy Speaker

With this it will be convenient to take the following amendments:

No. 16, in clause 3, page 3, line 39, at end add— '(6) The company shall not issue or register any shares to any person who is not a resident of the United Kingdom except by consent of the Treasury. No person who is so resident shall act as the nominee for any person who is not. (7) Any shares issued or registered in contravention of the fore-going subsection shall be deemed, for all purposes, to be owned by the Secretary of State.'.

No. 37, in clause 7, in page 6, line 40, at end insert 'Where the Secretary of State proposes to exercise any power to dispose of shares in the successor company either directly or through nominees he shall, subject to the provisions of this Act and subject to the need to prevent more than 15 per cent. of the shares in the successor company being owned directly or indirectly by any person not resident in the United Kingdom, take steps to ensure that he obtains an adequate price for them'.

Mr. Mitchell

The purpose of the new clause is clear, straightforward and self-evident. It seeks to safeguard the new organisation against a major foreign stake or influence in the new company. Such a safeguard is vital. Given the importance of this safeguard, we believe that it is essential that it should be written into the legislation and not left to the company's articles.

The Government are proposing to sell off a major national asset for entirely doctrinaire reasons—the change to the new concept of privatisation. Those doctrinaire reasons disguise the real reason for the sale, which is that the Government are desperate for cash. They are anxious not to cook the books, but to make them look as good as possible. They want to make it appear as though they have cut Government spending more than they have done, by selling off such assets.

I contend that the Government, being desperate for cash to make the books look better, will not be unduly concerned about the purchasers of the shares that they will be selling off. In other words, their proper preoccupation—that of responsibility for national interests and preventing foreign influence or control of the organisation—will take a back seat because of their desire to raise money, by selling off this asset.

8.15 pm

We should be concerned to prevent foreign control and influence over this organisation which is a vital national interest in an industry which plays a major role in defence. It operates in an area in which our competitors work closely with their national Governments. Indeed, in most instances those competitors are State-owned and controlled.

British Aerospace, having been launched into the private sector in this fashion, might find it difficult to raise money on the commercial market for long-term research. The Government indicated in Committee that they were not prepared to give any special financial help to the new company: it has to brave the rigours of the market; it has to operate in a strictly commercial fashion; and it will not get any Government preference for loans or backing by way of guarantees for loans. It may have to look for foreign help or co-operation with overseas aircraft firms. Therefore, it is important that we have this safeguard against foreign influence written into the legislation, and not into the company's articles which can be altered. It is important to have a watertight guarantee against foreign influence or control. The new clause would achieve that objective and make the position crystal clear.

I am aware that the Government have proposed safeguards in the company's articles. The Opposition do not regard such safeguards as a satisfactory guarantee against the kind of eventualities that we fear. Indeed, the Government have already agreed to change the articles by taking on board the points made by my hon. Friend the Member for Nuneaton (Mr. Huckfield). If the articles can be so readily changed, we prefer to see the guarantee written into the legislation. An expensive team of lawyers have prepared the articles, but what is the argument against putting this important guarantee against foreign influence or control into the legislation?

We must face the fact that BritishAerospace—competitive and productive as it is and a jewel in the crown of nationalisation—is an attractive investment not only to foreign companies and money but to foreign competitors. We fear that that kind of investment might give rise to eventual foreign domination. Therefore, we feel that this vital organisation should be controlled and safeguarded as a national asset, with the ownership maintained strictly within this country. The only guarantee of that position is to incorporate the safeguard in the legislation rather than in the company's articles. If the Government agree that it is important to have this safeguard, what is their argument against putting it in the legislation? Why do they want to restrict the safeguard to the company's articles? Why not make it a cast-iron, watertight safeguard by putting it in the Bill?

Dr. M. S. Miller

I have in my hand a six-page foolscap document containing the articles referred to by my hon. Friend.

Mr. Tristan Garel-Jones (Watford)

Read it out.

Dr. Miller

If I were to read it out I should be here for quite a long time.

I am not satisfied that the articles cover the position that occasioned such worry and fear in Committee. I appreciate that the Minister is in a difficulty in this respect. I think that he has tried, as far as possible, to allay our fears about the possibility of the company coming under foreign influence and domination, but the more I look at this paper, the more I become extremely confused.

The articles, at the beginning, state: It is a cardinal principle that the company should be, and remain, under United Kingdom control. That is a good object. I have no qualms about or fears in saying that I applaud the Minister's patriotic national feelings in this respect, but how to achieve it is an entirely different matter. I am not satisfied that this does it. Nor am I satisfied that anything in a legal form can guarantee the position that we would like. I indicated that to the Minister in Committee.

However legally tight something is drawn, there will be smart lawyers who will find ways round it, or, if they cannot do that, will make all kinds of problems and difficulties. This is not a game of cricket. We are not dealing with gentlemen's agreements and gentlemen's laws. We are dealing with hard-headed business men from overseas. Millions of dollars are involved. I use "dollars" advisedly. That was the currency used in the Lockheed scandal. In that scandal, as the House and the country know, more than mere politicians were involved. A royal family was involved. In such a situation, it is up to those in this country to ensure, by every means possible, that this industry, which is vital to the security of the country, does not come under the influence or the domination of foreigners.

I fail to see why it should be considered impossible for foreign nationals to form a company in this country. I defy anyone—other than a detective agency—who is willing to work from now until doomsday, to discover the people behind the company. It may sound a simple task, but, as I indicated in Committee, a man in Scotland, John McEwan, has spent a lifetime trying to find out who owns the land of Scotland. He still cannot find out. Behind one man there is another, and behind him another, and so on.

Mr. Adam Butler

We have heard this before.

Dr. Miller

The Minister says that we have heard this before, but he has not answered me. I am still not satisfied that, whatever action he takes, we can safeguard ourselves in this respect. It will do no harm for the Minister to have a clear indication from the Opposition that we have the interests of the people at heart and not merely—I am not using the word "merely" in a denigratory sense—the 68,000 workers in the industry. This is a vital industry for the country's security and safety.

The Minister can do little more to satisfy me that there is no possibility of this company coming under foreign influence and domination. Influence is bad enough. A situation could arise in which a number of directors did not have the interests of Britain at heart. They could be people from Lockheed, Boeing or another competitor of British Aerospace. They might be people who were concerned not so much with the fast buck that could be earned as with other considerations, even military considerations, involving this country.

I cannot allow the Report stage to proceed without once again voicing my utmost concern about possibilities that could arise unless we are extremely careful. My hon. Friend the Member for Grimsby (Mr. Mitchell) said that this matter should be included in the Bill so that when it became an Act of Parliament it could not be changed by the people who controlled the company. Even though the intentions of the Government are stated in the articles, there is nothing to stop the directors of the company from changing the articles.

Although the 'Government assure us that they will do ever thing in their power to make sure that a situation could never develop that would not be in the interests of this country, I cannot see how they can totally allay our fears. The least that can be done is to write into the Bill the kind of safeguards which the Minister envisages. We are not playing a game. There was reference earlier to tennis and to cricket, but this is not a game. We are not dealing with people who are playing tennis, golf or cricket.

I believe that, in general, British business men, with some notable exceptions such as those mentioned by my hon. Friend the Member for Keighley (Mr. Cryer), tend to act with a considerable degree of honour and uprightness. That does not necessarily apply to everyone. We should not believe that because we have taken a stand and declared that it is a cardinal principle that the company should remain under United Kingdom control it will necessarily remain so.

Mr. Cryer

I want to say a few brief words in support of my hon. Friend the Member for Grimsby (Mr. Mitchell), particularly in regard to new clause 12. First, it is quite useful that where the Secretary of State acts in this matter—that is, to control foreign investment—he should do so by statutory instrument.

The Minister will no doubt recall that Labour Members have stressed the importance of parliamentary accountability. I do not believe that Secretaries of State should be given carte blanche. I never have done, be they in a Labour or a Conservative Government. I believe that there should be some element of public accountability through the House of Commons. Therefore, new clause 12(1), which states that The Secretary of State shall by order made by statutory instrument fix a limit for investment by non-United Kingdom residents" is part of the process of ensuring that there is some element of public accountability. That is important. We are talking about the emerging company that will face enormous international competition. Safeguards are necessary and important for two reasons: first, for the company itself—that is, British Aerospace Ltd. or whatever it is called—because it will face competition of a vigorous sort, which it has done over the years; secondly, for the maintenance of a sound United Kingdom market for Rolls-Royce 1971 Ltd.

Conservative Members may recall that that was the company which the previous Conservative Government nationalised because it failed under private enterprise. Ministers have assured us time and again that private enterprise breeds only success. As we now know, that is not true. Indeed, in a debate last week on the Industry Bill the Minister pointed out that private enterprise meant both success and failure. Failure is often exacerbated by the abolition or erosion of a United Kingdom market. Rolls-Royce would certainly find itself in a difficult position if there were no aerospace industry, or if that industry were no longer in a position to place orders for engines, as a result of which it was left to the dominant manufacturers—the American companies, Lockheed and Boeing—to place those orders.

In that situation, it will almost certainly follow that there will be a preference for Pratt and Whitney engines rather than those of Rolls-Royce, and that Rolls-Royce will become very much a second-rate, second-best company in relation to orders. I emphasise that this is in relation to orders, because, happily, Rolls-Royce can make engines which are equal to or better than those of any other manufacturer in the world. Long may that remain the case.

However, Rolls-Royce requires a United Kingdom market in order to retain some sort of capacity which is not subject to the extreme vagaries of international competition. Therefore, to safeguard institutions such as Rolls-Royce at Barnoldswick, where some of my constituents work, it is necessary to ensure that the British aerospace industry retains a majority British shareholding and control.

The best way of doing that is through public ownership, and the best ownership is ownership in common through public ownership. However, we are not discussing that aspect. We are putting bits of sticking plaster over the cracks in this shoddy measure to hive off these important national assets. That bit of sticking plaster is simply to ensure the control remains in the hands of the United Kingdom.

Clearly, we shall not get the sort of statutory control by the Secretary of State in regard to shareholding that we desire. At least we can say to the Secretary of State through legislation that the number of shares that he can sell abroad will be limited. We have in mind principally Boeing, Lockheed and other great companies throughout the world. Such legislation would ensure that there would be no erosion of control of that important company by the sale of shares to its competitors.

8.30 pm

My hon. Friend the Member for East Kilbride (Dr. Miller) said that the aerospace industry had shown—though it might not be its norm—an element of unscrupulousness that shattered even the onlooker used to stories of the esoteric arrangements for bribes in the allocation of contracts. The Lockheed bribe scandal involving the Dutch royal family shocked the world. Such a scandal is an indica- tion of the ruthless attitude of a company determined to buy its way into contracts.

Will that attitude end? Can we be sure that that kind of ruthlessness will not raise its head again? Can we be sure that that underhand behaviour has gone for good? Or, in five or 10 years, will bribe scandals and the echoes of Watergate—which, in the event, have probably improved the public and corporate image of life in America—have simply become footnotes in the history books? Will the same kind of ruthlessness continue? In 10 years we shall no doubt have a Labour Government coming up for a second term of office, having successfully carried through Labour policies. In that case the problem may not arise.

But what of the shorter term? We must ensure in the shorter term that Lockheed does not recognise the crumbling economic policies of the present Government and, at the same time, recognise the fast fading support for this Government. We must ensure that Lockheed is not able to say "We must seize the opportunity to obtain a foothold in British Aerospace as quickly as we can".

These are conundrums we cannot answer except through legislation. However, we recognise the existence of these dangers. We know that ruthless international competition has in the past behaved in a highly unscrupulous manner and may do so again. In those circumstances, it behoves Parliament to lay down safeguards, through legislation, to prevent any transfer of control to the hands of our international competitors who, perhaps, have behaved unscrupulously.

Subsection (5) of new clause 12 refers to legal ownership or ownership through nominees". We have said that the provisions for shareholdings are by no means satisfactory and that shareholdings can be manipulated through nominees. That means that holdings can be built up without ownership being clearly and fully known to the company even as the shares are being purchased.

Subsection (5) is a useful safeguard because the Companies Bill which is going through the House is not the sort of legislation which will provide safeguards beyond a peradventure. That being so, I believe that it would be of great benefit to accept the clause.

We must have safeguards against the multinationals. The Conservative Government, no less than the Labour Government, will be blackmailed by the multinationals if we allow them to put their tentacles around such an important industry. They can threaten to close and tell the Government that if they want to save 50,000 or 60,000 jobs they must provide £Xmillion. That is the course on which Chrysler embarked in 1975. The multinationals can insist on preferential tax treatment. By virtue of their multinational base such companies can play off one country against another, for grants, for the retention of jobs and for tax advantages. They can shift money, through transfer pricing, from one country to another.

Such international competition makes Governments fall over themselves to give assistance. Governments play into the hands of the multinationals. However, an indigenous company has a loyalty to its base country. We should ensure that the Government are not subject to the power of the multinationals. Only by safeguarding our position and preventing that can we exert our sovereignty as a nation and a democracy. If we do not ensure that we have some protection against the multinationals, they will take us over.

Without much hope of success, I urge the House to accept the new clause. It will provide a statutory safeguard to ensure confidence in the industry. It will provide that the company is owned largely by the United Kingdom, ready for the next Labour Government to take it back into public ownership and so ensure continuity of aircraft production in Britain.

Mr. Stan Thorne

I shall not make a lengthy speech because I do not want to repeat the arguments.

It is a pity that yet again important legislation involving one of our major industries is being debated when only about a dozen hon. Members are in the Chamber. I do not wish to devalue the contribution by my hon. Friend the Member for Nuneaton (Mr. Huckfield), but there has been little representation on the Opposition Front Benches by my right hon. Friends who should be leading the fight against this measure. I have a feeling that some of my right hon. and hon. Friends are not particularly perturbed about the loss of the aerospace industry. I believe that it is a tragedy that a publicly owned enterprise such as this is to be passed to private hands.

It is estimated that 75 per cent. of the world's production will be in the hands of 300 companies by 1985. It is possible that the control of the aerospace industry will shift outside the United Kingdom to one of those 300 multinational companies. I hope that the Minister will reassure us that that cannot happen. Time alone will tell.

I am sorry to have to dissociate myself from amendment No. 16. It could lead to our being misunderstood. We could subsequently be accused of having been racialist in our proposal. I represent a constituency with a considerable number of Asians and others who have come to reside in Britain.

Dr. M. S. Miller

My hon. Friend may be accused of being xenophobic, but that does not mean that he is racialist.

Mr. Thorne

I do not know what xenophobic means. I did not have the advantage of an erudite education such as my hon. Friend the Member for East Kilbride (Dr. Miller) enjoyed.

There are those who argue that it is racialist—and I fully agree—to prevent a non-British subject from entering this country to marry a resident here. I understand that that is part of a proposal contained in orders that we shall subsequently discuss in this House. I accept that that is not the thinking behind the amendment. There are those who at some future time may accuse us of having been associated with an amendment that appeared to imply that persons outside the United Kingdom did not enjoy equal rights with those here, even though they were married to United Kingdom residents.

Mr. Robert Atkins

I oppose the clause and in doing so I wish to deal briefly with the conduct of some Labour Members. I came to the Chamber today expecting to hear new information, new discussion and a new contribution from the Opposition. However, nothing has changed. We have heard no new questions or answers from the Labour Benches and I find that typical.

Mr. Deputy Speaker (Mr. Richard Crawshaw)

Order. I hope that the hon. Gentleman will get on to the new clause. I made observations about this matter earlier. We are now dealing with a specific new clause.

Mr. Les Huckfield

Does the hon. Member for Preston, North (Mr. Atkins) accept that there is an established convention in this House that amendments that were called in Committee are usually not acceptable in exactly the same form on Report? If the hon. Gentleman looks carefully at the amendments which have been tabled and selected for tonight's debate he will see some important new proposals. If he cannot read the Amendment Paper, I am sorry for him.

8.45 pm

Mr. Atkins

I take note of that intervention. I support the Government's rejection of the new clause and shall have no fear of voting against it.

We have been criticised for lack of consultation with union leaders. However, we have met, for example, Rolls-Royce from Coventry, Bristol, Derby and Anstey and British Aerospace from Brough, Woodford, Bristol, Stevenage and Weybridge. We have met joint staff unions and joint staff councils and other manual workers and combined committees to discuss parts of the Bill, including this new clause.

Mr. Huckfield

But did not the majority of those representatives come to see the hon. Gentleman at the same meeting?

Mr. Atkins

No, that is not the case. We have already had three meetings with union leaders and representatives from℃

Dr. M. S. Miller

When one talks about consulting unions, one should give the name of the branch, the name of the secretary and the name of whomever one talks to. One does not just say "I met union branches or leaders." The hon.Gentleman should say whom he means. I expect that the people he has met are members of staff associations and not unions.

Mr. Atkins

I will read the hon. Gentleman some of the names and branches and the backgrounds of the people with whom we have discussed this clause—Ron Ford, secretary of the joint staff unions combined committee of British Aerospace, Woodford, Manchester; Mr. Alexander, secretary of the joint staff council of British Aerospace at Kingston-upon-Thames, Surrey; Mr. Cooper, chairman of the joint staff committee of British Aerospace, Weybridge—

Mr. Huckfield Same meeting.

Mr. Atkins

Another meeting. We also met Mr. Harrison from Rolls-Royce, Coventry, AUEW vice-chairman; Mr. Bell, British Aerospace, Brough; Mr. Ingram, Rolls-Royce, Anstey.

Mr. Huckfield

Same meeting.

Mr. Atkins That is not true. The hon. Gentleman repeats something many times in the hope that it will become true. These were separate meetings with union representatives or those unions which wrote asking to speak to us about this clause and others. It is no good hon. Members muttering across the Chamber that this was one meeting; it was a series of meetings—

Mr. Huckfield

The hon. Member is trying to establish that there was adequate consultation before and throughout the preparation of the Bill. Does he not admit that the people and branches that he is now listing were part of the same meeting with representatives of the national aerospace shop stewards liaison committee one Wednesday afternoon inthe House with the Conservative Party avatiation group? Is that not a fact?

Mr. Atkins

I repeat, for the benefit of the hon. Member for Nuneaton (Mr. Huckfield), who clearly is either deaf or incapable of understanding English, that we have had more than one meeting.

Mr. Huckfield

Two.

Mr. Atkins

Three, actually.

Mr. Huckfield

Two.

Mr. Atkins

We had three meetings with the various representatives and the names of them can be provided for hon. Members to see.

The level of debate and the constructive comments that were made during the course of those metings were of a high order. We parted on good terms, having discussed some of the problems, of which this clause was one. The House may not be surprised to learn that we did not agree on everything that was put forward. That is understandable. It is right and proper, in a democracy, that we should argue about various aspects of a Bill that is going through Parliament. Nevertheless, we parted on excellent terms and made arrangements to meet on a regular basis in future to dicuss the special problems and interests of aerospace generally.

I believe that it is important to get on record that all the details of our discussions, through the kind auspices of my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson), were passed back in full reports—

Mr. Huckfield

Tape recorded.

Mr. Atkins

—of all that was discussed to my hon. Friends the Minister of State and the Under-Secretary so that they could take note of them and, if they felt inclined, constructively comment on them when they came before the House.

That proves, above all, that all the snide stories put around by those, within and without this House, about Conservative Members' refusal to take consultations on this clause and others are no more than party political propaganda. I want to get on the record that we are firmly prepared to discuss on a regular and continuing basis those problems that affect the industry, about which we care deeply. This clause is but one part of the discussions we have had.

It is worth reminding the House that my constituency, as the hon. Member for Preston, South (Mr. Thorne) indicated, is strongly involved in the aerospace industry in the military context. The company in my constituency is profitable and well-organised. It was profitable before nationalisation and will be after denationalisation.

I welcome the Government's attitude in opposing this clause and I hope that it, along with others, will be rejected by the House.

Mr. Adam Butler

I thank my hon. Friend the Member for Preston, North (Mr. Atkins)—

Mr. Huckfield

What for?

Mr. Butler

—for his contribution. He has spoken probably more sense, and kept closer to the facts, than have most Opposition Members this afternoon or in Committee. On the question of foreign ownership, I have had some constructive meetings with unions and have been able to set their minds at rest. Trade union members, unlike, Opposition Members, take note of what a Government Minister says and accept his word asthat of someone who intends to keep it.

There are two separate parts to this debate which, like other debates, we have had at considerable length in Committee. The first point is what the Government intend to do to safeguard the position on foreign shareholding, and the second is whether this should be done through the articles of association or by incorporating some declaratory clause of the kind the Opposition want in the Bill.

Let me make it clear that the Government are determined that British AerospaceLtd. shall not fall into undesirable foreign hands. We believe that foreign shareholding should be kept to a limited amount and not be allowed to resemble control. We made the Government's intention clear during Second Reading on 20 November 1979, and on 23 July when my right hon. Friend the Secretary of State made his initial statement. We repeated it frequently in Committee, as I have said. If one were to look at reports of our debates on 18 December and 15 and 24 January, one would find words to prove that.

But, again, I should like formally to set on record the Government's determination to prevent the company from falling into foreign control. This is particularly important because of its defence interests.

The hon. Member for Keighley (Mr. Cryer)—I occasionally agree with him—said that control must remain in the United Kingdom. Provided that we can at least agree on that point, what matters clearly is how we achieve it. The Government intend to use a mixture of three approaches. The first is to use the articles of association to provide an article of the successor company which restricts foreign ownership to not more than 15 per cent. of the voting rights in the company. The second, as we have made clear, is that we should use the Government's shares either to stop any attempt to change this article or to remove it altogether, and to use the Government's shares to oppose the election of directors representing foreign interests. Then, as a fallback, we would be prepared to use part II of the Industry Act 1975 to stop a change of control of this key manufacturing enterprise.

Mr. Huckfield

Ah.

Mr. Butler

The hon. Member makes a noise which is difficult to interpret.

Mr. Huckfield

Read it in Hansard tomorrow and you will see that it says—

Mr. Deputy Speaker

Order. If the hon. Gentleman wishes to intervene, he must stand up to do so.

Mr. Butler

We can either assume that the hon. Member was not present in Committee with us when we made this clear, on probably two or three occasions, or, as so frequently happened, he conveniently forgot what was said from the Government Benches.

We believe that these three mechanisms working together will be foolproof. The most important of them is the restriction in the company's articles of association. As I have made clear in this debate, we lodged in the Library a draft article during the Christmas Recess. We debated that article at considerable length in Committee. I am not quite sure why the hon. Gentleman should complain that a new amended draft article was put in the Library some few days ago, in the middle of last week, when that resulted from our debates in Committee. I should have thought that a few days after the Committee stage would not be an unreasonable length of time to take to amend a draft article and put it in the Library. There it is, and it spells out what we believe to be the right provisions for dealing with this point.

As I have previously made clear, certain powers will be given to the directors to challenge shareholding. Unlike the problem which the hon. Member for East Kilbride (Dr. Miller) cited in regard to Mr. McEwan and the ownership of land in Scotland, the law of Scotland is not well known to us Sassenachs, but, even so, the point with regard to the shares is that they first have to be registered and, secondly, it will be necessary for a shareholder in British Aerospace Ltd. to prove that he is not a foreigner as defined in the article. If the directors have reason to suppose that a share is foreign-held and if this were to bring the proportion of shares held by foreigners above 15 per cent., they would be empowered to disenfranchise those shares, and if the proportion of shares was found to be above 15 per cent. the excess proportion would have to be sold off.

9 pm

The question then is whether it is safe to put such a safeguard in the articles of association. It would not be safe to do so if all the shareholders determined to change the articles in this respect. It is the intention of the Government to hold a shareholding of no less than 25 per cent. The purpose of that 25 per cent. is to block any attempted change in the articles of association in respect of a foreign holding or anything that might be damaging to the interests of the company. If a general meeting is called for the purpose of amending the articles, 25 per cent. of the shares would be necessary. If the Government retain, as we shall, a 25 per cent. holding, and if they are prepared to use that shareholding to oppose any change, that will provide a sufficient safeguard.

Mr. Ernie Ross

I apologise to the Minister, as I missed the earlier part of his statement. He says that we should accept his statement that the Government will retain 25 per cent. of the shareholding, and that they will thereby be able to block any foreign shareholding. However, Government policy on a number of issues has been determined by their wish not to intervene. Therefore, we are worried that if there were a foreign takeover the Government would not intervene.

Mr. Butler

It is possible for the Government to stand back from British Aerospace and to allow it to operate as a private sector company while retaining a 25 per cent. shareholding and the power and intention to block any change in the articles of association.

I turn to the question whether it would be better to attempt to safeguard the company from foreign control. We have good evidence that the articles of association should not be incorporated in the Bill. If they were incorporated in the Bill, no improvements could be made. That is a small but important point.

Should there be some declaratory pro-provision? New clause 12 is defective on various grounds. If the hon. Member for Nuneaton (Mr. Huckfield) consults his legal advisers, he will find that he will have to cover the point in much greater detail and complexity in order to achieve his objective. In the Industry Bill, 10 clauses and seven pages were necessary to restrict foreign ownership. As the hon. Member for East Kilbride pointed out, our draft article on foreign ownership amounts to six pages. Therefore, such a small clause will not be effective.

The main argument concerns whether it is helpful to include such a provision in the Bill. In theory, the articles of association could be changed if a majority of shareholders so wished, and if the Government were not prepared to exercise their 25 per cent. blocking vote. Equally, if a provision were enacted, the Government of the day could change it. In either case—whether one uses the articles, or the Bill to safeguard the company—if a Government are determined to change the position, one will be no better off.

The hon. Member for Nuneaton has some association with members of the Communist Party. I am bound to say that there could be circumstances in which a Government of this country, possibly of the persuasion of the hon. Member for Nuneaton and the hon. Member for Keighley, might find that they wanted to sell part of British Aerospace Ltd. to a foreign Power. If safeguards were incorporated solely in legislation, such a Government would be able to do so. If we incorporate safeguards in the articles, control would be in the hands of the shareholders. If 25 per cent. of the shareholders did not want such a thing to happen, they would have control. As we are ceaselessly told, shareholders are interested in the future of the company.

If I were an employee of British Aerospace, I would prefer to have the safeguard in the hands of a Conservative Government who were prepared to exercise their 25 per cent. voting power. However, if that 25 per cent. was held by a Government of the persuasion of the hon. Member for Nuneaton, I should at least know that I was safe in the hands of my shareholders.

Mr. Les Huckfield

We usually hear comments like that at this time of the evening. It is typical of the totally unwarranted remarks that the hon. Gentleman makes.

We are making a plea to include a preventative mechanism on prohibition in the Bill. We recognise that if a Government, of whatever persuasion, wanted to change that provision, the matter would have to come before the House. If the hon. Gentleman does not believe in the traditions of the House and majority rule, let him say so now.

Mr. Butler

The hon. Gentleman knows that I have the deepest respect for the House, its traditions, the Chair and our two-Chamber system.

Mr. Huckfield

This Chamber.

Mr. Butler

I believe that the hon. Member for Nuneaton and some of his hon. Friends believe in abolishing the House of Lords and operating a unicameral system, and that would add to the dangers that I described.

Mr. Stan Thorne

The hon. Gentleman made reference to my hon. Friend the Member for Nuneaton (Mr. Huckfield) having friends who are Communists. I too, have friends who are Communists, and am proud of it. I deprecate the fact that the hon. Gentleman omitted me from his references to my hon. Friend the Member for Nuneaton and, vaguely, my hon. Friend the Member for Keighley (Mr. Cryer). I feel somewhat jilted. We should be under no illusions. Some Communists today put up a tremendous fight in the interests of their colleagues in the trade union movement.

Mr. Butler

I apologise to the hon. Member for Preston, South (Mr. Thorne) for leaving him out. We know his position on defence Votes. His constituents will take special note of the occasions of which he may be proud—and he is entitled to his views—when he voted for reduced defence expenditure, thus voting to put his constituents out of work. That is why his majority is small—

Mr. Speaker

Order. I have not been here throughout the debate on this new clause, but I know that that is not related to it.

Mr. Cryer

On a point of order, Mr. Speaker. The Minister made an unwarranted imputation on my hon. Friend the Member for Nuneaton (Mr. Huckfield) as well as on others of my hon. Friends and myself, suggesting that by association with Communists or members of that political party we were in some way acting as dishonourable traitors to our country. May I point out that on an occasion when such an implication was made it was specifically withdrawn by the right hon. Member concerned, and you accepted that?

Mr. Speaker

Order. It would be quite out of order if the word "traitor" was used—

Mr. Cryer

No, Mr. Speaker, it was not.

Mr. Speaker

—but it seems to me that there has probably been an exchange of views across the Floor not strictly related to new clause 12 and the amendments grouped with it, and we must now keep to that.

Mr. Butler

I was envisaging a hypothetical situation in which a British Government of a certain political persuasion might wish for the shares in British Aerospace Ltd. to be sold to a foreign Power. I was going on to suggest that if the safeguard were incorporated in the articles of association it would be a greater safeguard in that possible circumstance than if a provision were written into the Bill.

Mr. Martin Flannery (Sheffield, Hillsborough)

A disgraceful imputation.

Mr. Butler

I have spelt out what the Goverment intend to do. I have ackowledged—correctly, I believe—that the Opposition are at one with the Government in intending that there shall be no foreign control, and there is possibly some difference of opinion about the means of achieving that end. I have given one sound reason why, in the interests of British Aerospace, it is better for the safeguard to be incorporated in the articles, and I therefore ask my hon. Friends to reject the new clause.

Mr. Ernie Ross

I shall be brief and speak with particular reference to amendment No. 16. In Committee we pressed the Government to recognise that there were many people outside this place interested in the future of British Aerospace, and we showed that the Government's denationalisation proposals in no way reflected the aspirations and wishes of the workers in the industry. We did not accept that the Government's plans in any way met the needs, wishes and aspirations of those workers, but the Government chose to ignore our case.

We pointed out that one of the greatest fears among those whose interests we sought to represent was about the extent to which foreign investment might come into British Aerospace, with the consequent loss of jobs in the industry in this country.

We were concerned also, as the workers were, that the role played by the trade union movement was being ignored by the Government in their attempts to denationalise British Aerospace. We have shown throughout that the trade union movement has put forward ideas for the improvement of British Aerospace, despite their being ridiculed by hon. Members on the Government Benches. They have obviously failed to recognise the crucial role played by the workers in the industry in making British Aerospace successful. If there is to be a viable British Aerospace after denationalisation, the good will of the workers is required.

Everyone—from management down to the shop floor—has made it clear that he is concerned that foreign shareholding could severely damage British Aerospace, as it is now constituted. They have also made it clear that they do not believe that any foreign shareholding will be in the interest of British Aerospace. The foreign shareholding may take the form of a multinational corporation that is determined that there will be only one aerospace industry—the American aerospace industry. We are concerned that there will be hiving off of sectors of the industry if the foreign investor demands that the work be channelled elsewhere.

For those reasons, the work force has asked us to oppose the Government, and to attempt to write into the Bill some control over foreign investments. If the Minister believes that a 25 per cent. Government shareholding is sufficient, he has failed to satisfy the workers or management of British Aerospace, who have made the point on numerous occasions that they are happy with the industry as it is now.

9.15 pm

Mr. Cryer

I would not have intervened but for the remarks of the Minister of State regarding my hon. Friend the Member for Nuneaton (Mr. Huckfield). Labour Members have tabled constructive amendments in Committee and on Report that are designed to stop British Aerospace falling into foreign hands. It does not matter whether it is the American multinationals or the Comecon multinationals. This important and valuable industry, which employs 68,000 directly, should stay in the control of the United Kingdom. It is disgraceful for the Minister of State to imply that, because my hon. Friend the Member for Nuneaton has walked in defence of a sacked shop steward—whose politics are irrelevant, but whose position has been brought about by victimisation—somehow my hon. Friend does not support new clause 12. That was the imputation.

On a point of order I raised the propriety of a right hon. Member of this House implying that Labour Members are not loyal. The right hon. Member later apologised to the House. I hope that those Members who are starting the "Reds under the beds" scare will bear that in mind. We shall stand up and defend the interests of the people with more determination than members of the Conservative Party have ever done. They and their kind are prepared to sell out the workers of the country for the fastest profit. In 1972–74—

Mr. Speaker

Order. I am sorry to interrupt the hon. Gentleman. I have just discovered that the hon. Gentleman has already made a speech on new clause 12. I am sorry to rob the House, but hon. Members cannot have more at this stage.

Mr. Cryer

I was under the impression that one could speak twice on Report, but, having spoken twice, I shall not indulge the House any further.

Mr. Speaker

I may say that everyone falls into the same error. That applies to Committee stage, but not to Report stage.

Mr. Les Huckfield

We should thank my hon. Friend the Member for Keighley (Mr. Cryer) for setting this constitutional precedent. Although I do not wish to counter your ruling, Mr. Speaker, I note that he was speaking in my defence when he resumed his seat.

Mr. Speaker

Order. I believe that the hon. Gentleman has also spoken before. If he has not—and I can tell by the look on his face that he has not—I shall call the hon. Gentleman.

Mr. Huckfield

I can give you, Mr. Speaker, and the House a categoric assurance that I have not yet spoken in this debate.

The amendments are relevant to the most crucial issue in our consideration of the Bill. We make no secret of the fact that the new clause is taken from the Industry Act 1975.

I hope that the hon. Member for Enfield, North (Mr. Eggar) is listening, because in his last speech in the House he sounded only too anxious to see more and more industry leaving this country. That is the sort of speech that he makes.

Mr. Robert Atkins

That is a disgraceful accusation.

Mr. Huckfield

It is a pity that the hon. Gentleman was not in the House to hear his hon Friend.

Mr. Tim Eggar (Enfield, North)

Will the hon. Gentleman give way?

Mr. Huckfield

No.

Mr. Eggar

rose—

Mr. Speaker

Order. We can have only one hon. Member on his feet at a time.

Mr. Huckfield

The hon. Member for Enfield, North pays scant attention to any of our proceedings, so I am not giving way to him.

New clause 12 seeks to insert into the Bill a declaratory provision which we have unashamedly taken from the 1975 Act which was put on the statute book by the previousLabour Government. We are firm in our belief and convinced that the best way of inserting a preventive mechanism and a prohibition is to put it into the Bill. That is not to say that we accept the Bill, but if we are to do anything to prevent foreign control and domination, the mechanism should be inserted in the Bill.

My hon. Friend the Member for Preston, South (Mr. Thorne) referred to the possibility of a racist interpretation of amendment No. 16. The amendment was not drafted with any such intention. We simply do not wish to see the transfer of control or share ownership from this country to other countries. I recognise that the amendment is, to a certain extent, an alternative to the new clause, but we wished to test the Government's responses, and that is why we tabled the amendment.

As I mentioned earlier, I do not wish to challenge the selection of amendments, but we thought that it might have led to a speedier passage of the remaining stages if amendment No. 37, which is included in the group under discussion, had been taken with the first group. We felt that it was more relevant to that debate.

The amendment makes the point that the Secretary of State must be guided by the need to have no more than 15 per cent. of the shares owned by one foreigner or a collection of foreigners. We seek to insert a preventive mechanism in the Bill so that if any future Government wished to amend such a provision they would have to come to the House for approval. I was worried about what the hon. Gentleman said. He seemed to suggest that he might not be prepared to accept the vote of a future Government who had a majority in the House. That was the worrying imputation of what the hon. Gentleman said.

Mr. Stan Thorne

Remember Chile.

Mr. Huckfield

We can now see why at every stage at which we have tried to insert a provision for a debate under the affirmative resolution procedure the Minister has opposed it. From the way that he spoke tonight, it does not appear that he is prepared to accept majority verdicts in the House if they do not agree with his views or suit his convenience. That is a dangerous doctrine to follow. It is dangerous for a Minister of State in this Government to say anything like that in the House.

We sought to insert that provision because we believe in a democratic majority vote in the House. We felt that the best way to guard against any kind of change was to put this provision in the Bill so that any future amendment would have to be debated in the House.

The Government have chosen a somewhat different route. [Interruption.] The hon. Member for Plymouth, Sutton (Mr. Clark) has come to join in with his usual banter across the gangway, but I hope that he will listen to the occasional sentence.

The Government have chosen a different route. First, they say that they have made provision in an article of association of this company that there will be no more than a 15 per cent. foreign shareholding or shareholdings. We have already taken legal advice on the amended draft article which the Minister placed in the Library last Friday. That advice is that the article of association which the Government intend to submit as one of the articles of association of the new company is not watertight. The main mechanism on which the hon. Gentleman is relying for the prevention of foreign ownership, control and domination of the company is not watertight. My information is that it is sloppily and loosely drafted.

I direct the Minister's attention to page 6 of the draft article, paragraph (I): The Directors shall not be required to give any reasons for any decision or declaration taken or made in accordance with this Article. I want to know why that provision was inserted in this article. I have to say to the Minister—

Mr. Alan Clark (Plymouth, Sutton)

Will the hon. Gentleman give way?

Mr. Huckfield

I shall give way to the hon. Gentleman at my convenience, not his.

Every time we have sought to correct the draft article placed before the House by the Minister he has gone back to his Department and then come forward with an apology to the effect that he has found that the draft article is not watertight, after all, and that he feels the need to take on board some of the amendments suggested by the Opposition.

As the Government appear to be relying on this draft article to prevent some kind of foreign takeover or control, I hope that we shall not get a whole series of occasions on which the Minister puts newly drafted articles in the Library about which we have to take legal advice and show him how to amend them. This is the second time that he has put a draft article before the House to which we have had to suggest amendments and to which he has to say that the amendments are good because they make the draft article more watertight.

Mr. Clark

Will the hon. Gentleman give way?

Mr. Huckfield

If the hon. Gentleman has a sensible point to make, I shall give way to him.

Mr. Clark

I am grateful to the hon. Gentleman for giving way. As he knows, I have been unable to be present throughout the whole of the debate. I suggest that the whole tenor of his argument is the purest hypocrisy. If the assets of the concern are physically located in the United Kingdom, the fact that the Tribune Group, of which the hon. Gentleman is a member, has committed itself to nationalisation without compensation means that unless he wishes to repudiate that declaration the niceties of the shareholders' register are the last things that he will consider in the future.

9.30 pm

Mr. Huckfield

I am sorry that I gave way. The hon. Gentleman is not on form tonight.

The other mechanism which the Government say they will use to ensure that the new company does not fall into the hands of foreigners is their own shareholding, but until the Government hastily drafted their amendment over the weekend they did not even possess a mechanism in the Bill to ensure that they could keep a 25 per cent. shareholding. They had to put an amendment into the Bill over the weekend to ensure that if certain City manipulations had the consequence of their shareholding falling below 25 per cent. their share of voting rights could be restored to 25 per cent.

The Government had to make that amendment because they realised that their Bill, as originally drafted, would not have enabled them to maintain, or to increase, their percentage of voting rights in the company. When the Minister says that he will use the Government's percentage of shareholdings and that the Government intend to use their stake in the company as a blocking mechanism under the Companies Act 1948, I say to him that we would have been far more convinced of that kind of intention had they made adequate provision in the Bill to enable them to take that action. In Committee we warned the hon. Gentleman that he was getting himself into a ridiculous straitjacket in clause 7. He was insisting that each new Government target investment limit—I see that there is a piece of paper waiting for him, which will perhaps tell him what to say next—had to be lower than the last one and that if they took up additional shares and put in more money under clause 5, then, because of what we call the ratchet mechanism in clause 7, they would be forced to dispose not only of those shares but of the voting rights.

Under the originally drafted Bill, the combined effect of clause 5 and the ratchet mechanism in clause 7 would not have enabled the Secretary of State to maintain the 25 per cent. shareholding, and thus the blocking mechanism that he needs under the Companies Act 1948. I am glad that the Government have amended the Bill. They will now be able to try to do something like that. If they had inserted a figure for that shareholding, we should have been far more convinced.

We accept that the fallback of the Industry Act 1975—the belt and braces approach—is a good point for the Government to make. We should like to see the mechanism based on the 1975 Act developed, enhanced and extended so that it would stretch out to equal what we proposed in new clause 12. Our criticism is that there is too much emphasis and onus, and too great a burden, placed on the directors of this company to find out the beneficial owner of the shares. The Minister knows as well as I do that there is no way on earth that directors can prove that a shareholder or shareholder's nominee is under the influence, control or domination of someone who does not live in this country.

There is no way on earth that the directors, even if they employ the CIA, BOSS, or any type of private investigator, can prove that somebody is, or is not, under the control, influence or direction of someone who does not live in this country.

Mr. Keith Wickenden (Dorking) rose—

Mr. Huckfield

If the hon. Gentleman will allow me to finish this point, I shall be glad to give way. I am glad that the hon. Gentleman has finally considered that he has a point to make. That is why we say that there is nothing in the Bill, nothing in the draft articles, nothing in the ministerial assurances that we have so far received, and nothing that we have heard during the passage of this Bill that will prevent this industry, lock stock and barrel, from leaving these shores. That is why we shall continue to oppose the Bill. There is nothing in the Bill itself, nothing in the articles so far submitted, and nothing in the assurances that we have so far received that will prevent this industry from coming under the kind of foreign control and domination that we fear.

Mr. Wickenden

Does the hon. Gentleman agree that the Office of Fair Trading, through the Monopolies and Mergers Commission, has considerable powers to say whether a company shall fall under foreign control? For example, will he consider the case last year of Furness Withy, where that company was prevented from coming under overseas control?

Mr. Huckfield

The hon. Gentleman ought to realise that the Minister responsible for that commission is the right hon. Member for Gloucester (Mrs. Oppenheim). That does not exactly enthral us or lead us that to believe that she will be goaded to move into action the provisions to which the hon. Gentleman has referred.

The Minister knows that it is impossible to prove whether a shareholder or a shareholder's nominee is or is not under the control, influence or direction of someone who does not live in this country. The Minister knows that as well as I do.

Mr. Wickenden

rose—

Mr. Huckfield

I shall not give way, because I have already given way to the hon. Gentleman. If new clause 12 or amendment No. 16 does not go far enough, the Minister should show us how they could be amended. He should give

us an understanding that they can be amended and brought back in another place. We do not claim any kind of monopoly of parliamentary draftmanship or wisdom. If the amendment is in some way technically defective, or if it needs to be enlarged or enhanced, I hope that the Minister will take it on board, but he has not said that. He has said that he will not even try to do that.

We feel that any kind of change in the ownership, control or domination of this company ought to be referred to this House. After all, we are talking about a significant industry and a significant part of our gross national product.

I must, finally, make reference to the cheap jibe that was made about my association with the chairman of the Leyland joint shop stewards. I say to the House and to the Minister that I shall continue to stand by Derek Robinson and the Leyland joint shop stewards for a very simple reason, which fits in very much with what I have said about the new clause. The Leyland shop stewards and Derek Robinson have shown much more determination to keep a manufacturing industrial base in this country than Conservative Members have ever chosen to do.

When the Minister spoke in our last textile debate, he actually said that he wanted jobs to go abroad.

Mr. Eggar

rose—

Mr. Huckfield

When Conservative Members infrequently come to this House, they ought to recognise that we want to see this industry kept in this country. We do not want to become subcontractors to the Americans. We want to maintain an independent aerospace manufacturing capability in this country. That is what new clause 12 is all about and that is why, following the complete lack of reassurance from the Minister, we feel bound to press it to a Division.

Question put, That the clause be read a Second time:—

The House divided: Ayes 237, Noes 302.

Division No. 168]	AYES	[9.40 pm
Abse, Leo	Armstrong, Rt Hon Ernest	Barnett, Guy (Greenwich)
Adams, Allen	Ashley, Rt Hon Jack	Barnett, Rt Hon Joel (Heywood)
Allaun, Frank	Ashton, Joe	Benn, Rt Hon Anthony Wedgwood
Archer, Rt Hon Peter	Atkinson, Norman (H'gey, Tott'ham)	Bennett, Andrew (Stockport N)
Bidwell, Sydney	Grant, John (Islington C)	O'Halloran, Michael
Booth, Rt Hon Albert	Hamilton, W. W. (Central Fife)	O'Neill, Martin
Boothroyd. Miss Betty	Harrison, Rt Hon Walter	Orme, Rt Hon Stanley
Bottomley, Rt Hon Arthur (M'brough)	Hart, Rt Hon Dame Judith	Owen, Rt Hon Dr David
Bradley, Tom	Hattersley, Rt Hon Roy	Palmer, Arthur
Bray, Dr Jeremy	Haynes, Frank	Park, George
Brown, Hugh D. (Provan)	Healey, Rt Hon Denis	Parker, John
Brown, Robert C. (Newcastle W)	Heffer, Eric S.	Pavitt, Laurie
Brown, Ronald W. (Hackney S)	Hogg, Norman (E Dunbartonshire)	Pendry, Tom
Brown, Ron (Edinburgh, Leith)	Holland, Stuart (L'beth, Vauxhall)	Powell, Raymond (Ogmore)
Buchan, Norman	Home Robertson, John	Prescott, John
Callaghan, Rt Hon J. (Cardiff SE)	Homewood, William	Price, Christopher (Lewisham West)
Callaghan, Jim (Middleton & P)	Hooley, Frank	Race, Reg
Campbell, Ian	Horam, John	Rees, Rt Hon Merlyn (Leeds South)
Canavan, Dennis	Howell, Rt Hon Denis (B' ham, Sm H)	Richardson, Jo
Cant, R. B.	Huckfield, Les	Roberts, Alian (Bootle)
Carmichael, Neil	Hudson Davies, Gwilym Ednyfed	Roberts, Gwilym (Cannock)
Carter-Jones, Lewis	Hughes, Mark (Durham)	Robertson, George
Cartwright, John	Hughes, Robert (Aberdeen North)	Robinson, Geoffrey (Coventry NW)
Clark, Dr David (South Shields)	Hughes, Roy (Newport)	Rodgers, Rt Hon William
Cocks, Rt Hon Michael (Bristol S)	Janner, Hon Greville	Rooker, J. W.
Cohen, Stanley	Jay, Rt Hon Douglas	Roper, John
Concannon, Rt Hon J. D.	Johnson, Walter (Derby South)	Ross, Ernest (Dundee West)
Conlan, Bernard	Jones, Rt Hon Alec (Rhondda)	Rowlands, Ted
Cook, Robin F.	Jones, Barry (East Flint)	Ryman, John
Cowans, Harry	Jones, Dan (Burnley)	Sandelson, Neville
Craigen, J. M. (Glasgow, Maryhill)	Kaufman Rt Hon Geralo	Sever, John
Crowther, J. S.	Kerr, Russell	Sheerman, Barry
Cryer, Bob	Kilroy-Silk, Robert	Sheldon, Rt Hon Robert (A'ton-u-L)
Cunliffe, Lawrence	Kinnock, Neil	Short, Mrs Renée
Cunningham, George (Islington S)	Lambie, David	Silkin, Rt Hon John (Deptford)
Cunningham, Dr John (Whltehaven)	Lamborn, Harry	Silkin, Rt Hon S. C. (Dulwich)
Dalyell, Tam	Lamond, James	Silverman, Julius
Davidson, Arthur	Leighton, Ronald	Smith, Rt Hon J. (North Lanarkshire)
Davies, Rt Hon Denzil (Llanelli)	Lestor, Miss Joan (Eton & Slough)	Snape, Peter
Davies, Ifor (Gower)	Lewis, Arthur (Newham North West)	Soley, Clive
Davis, Terry (B'rm'ham, Stechford)	Lewis, Ron (Carlisle)	Spearing, Nigel
Deakins, Eric	Litherland, Robert	Spriggs, Leslie
Dempsey, James	Lofthouse, Geoffrey	Stallard, A. W.
Dewar, Donald	Lyon, Alexander (York)	Stoddart, David
Dixon, Donald	Lyons, Edward (Bradford West)	Stott, Roger
Dobson, Frank	Mabon, Rt Hon Dr J. Dickson	Strang, Gavin
Dormand, Jack	McCartney, Hugh	Straw, Jack
Douglas, Dick	McDonald, Dr Oonagh	Summerskill, Hon Dr Shirley
Dubs, Alfred	McElhone, Frank	Taylor, Mrs Ann (Bolton West)
Duffy, A. E. P.	McKay, Allen (Penistone)	Thomas, Dafydd (Merioneth)
Dunn, James A. (Liverpool, Kirkdale)	McKelvey, William	Thomas, Jeffrey (Abertillery)
Dunnett, Jack	MacKenzie, Rt Hon Gregor	Thomas, Mike (Newcastle East)
Eadie, Alex	Maclennan, Robert	Thorne, Stan (Preston South)
Eastham, Ken	McMahon, Andrew	Tilley, John
Edwards, Robert (Wolv SE)	McMillan, Tom (Glasgow, Central)	Tinn, James
Ellis, Raymond (NE Derbyshire)	McNally, Thomas	Torney, Tom
Ellis, Tom (Wrexham)	McNamara, Kevin	Urwin, Rt Hon Tom
English, Michael	McWilllam, John	Varley, Rt Hon Eric G.
Ennals, Rt Hon David	Magee, Bryan	Wainwright, Edwin (Dearne Valley)
Evans, Ioan (Aberdare)	Marks, Kenneth	Walker, Rt Hon Harold (Doncaster)
Evans John (Newton)	Marshall, David (Gl'sgow, Shettles'n)	Watkins, David
Ewing, Harry	Marshall, Dr Edmund (Goole)	Weetch, Ken
Faulds, Andrew	Martin, Michael (Gl'gow, Springb'rn)	Welsh, Michael
Field, Frank	Mason, Rt Hon Roy	White, Frank R. (Bury & Radcliffe)
Fitch, Alan	Maxton, John	White, James (Glasgow Pollock)
Flannery, Martin	Maynard, Miss Joan	Whitehead, Phillip
Fletcher, Ted (Darlington)	Meacher, Michael	Whitlock, William
Foot, Rt Hon Michael	Mellish, Rt Hon Robert	Williams, Rt Hon Alan (Swansea W)
Forrester, John	Mikardo, Ian	Williams, Sir Thomas (Warrington)
Foster, Derek	Millan, Rt Hon Bruce	Wilson, Gordon (Dundee East)
Foulkes, George	Miller, Dr M. S. (East Kilbride)	Wilson, Rt Hon Sir Harold (Huyton)
Fraser, John (Lambeth, Norwood)	Mitchell, R. C. (Soton, Itchen)	Wilson, William (Coventry SE)
Freeson, Rt Hon Reginald	Morris, Rt Hon Alfred (Wythenshawe)	Winnick, David
Garrett, John (Norwich S)	Morris, Rt Hon Charles (Openshaw)	Woodall, Alec
Garrett, W. E. (Wallsend)	Morris, Rt Hon John (Aberavon)	Wrigglesworth, Ian
George, Bruce	Morton, George	Young, David (Bolton East)
Gilbert, Rt Hon Dr John	Moyle, Rt Hon Roland
Golding, John	Newens, Stanley	TELLERS FOR THE AYES:
Gourlay, Harry	Oakes, Rt Hon Gordon	Mr. Austin Mitchell and
Graham, Ted	Ogden, Eric	Mr. James Hamilton.
Grant, George (Morpeth)
NOES
Adley, Robert	Atkins, Robert (Preston North)	Bell, Sir Ronald
Altken, Jonathan	Atkinson, David (B'mouth, East)	Bendall, Vivian
Alexander, Richard	Baker, Nicholas (North Dorset)	Benyon, Thomas (Abingdon)
Ancram, Michael	Banks, Robert	Benyon, W. (Buckingham)
Arnold, Tom	Beaumont-Dark, Anthony	Best, Keith
Aspinwall, Jack	Beith. A. J.	Biffen, Rt Hon John

Biggs-Davison, John	Grant, Anthony (Harrow C)	Montgomery, Fergus
Blackburn, John	Gray, Hamish	Moore, John
Blaker, Peter	Greenway, Harry	Morgan, Geraint
Body, Richard	Grieve, Percy	Morris, Michael (Northampton, Sth)
Bonsor, Sir Nicholas	Griffiths, Eldon (Bury St Edmunds)	Morrison, Hon Charles (Devizes)
Boscawen, Hon Robert	Griffiths, Peter (Portsmouth N)	Morrison, Hon Peter (City of Chester)
Bottomley, Peter (Woolwich West)	Grist, Ian	Mudd, David
Bowden, Andrew	Grylls, Michael	Murphy, Christopher
Boyson, Dr Rhodes	Gummer, John Selwyn	Myles, David
Bradford, Rev. R.	Hamilton, Hon Archie (Eps'm&Ew'll)	Neale, Gerrard
Braine, Sir Bernard	Hamilton, Michael (Salisbury)	Needham, Richard
Bright, Graham	Hampson, Dr Keith	Nelson, Anthony
Brinton, Tim	Hannam, John	Neubert, Michael
Brittan, Leon	Haselhurst, Alan	Newton, Tony
Brocklebank-Fowler, Christopher	Hastings, Stephen	Nott, Rt Hon John
Brooke, Hon Peter	Havers, Rt Hon Sir Michael	Onslow, Cranley
Brotherton, Michael	Hawkaley, Warren	Osborn, John
Brown, Michael (Brigg & Sc'thorpe)	Hayhoe, Barney	Page, Rt Hon Sir R. Graham
Browne, John (Winchester)	Heddle, John	Page, Richard (SW Hertfordshire)
Bruce-Gardyne, John	Henderson, Barry	Parkinson, Cecil
Bryan, Sir Paul	Haseltine, Rt Hon Michael	Parris, Matthew
Buchanan-Smith, Hon Alick	Hicks, Robert	Patten, Christopher (Bath)
Buck, Antony	Higgins, Rt Hon Terence L.	Patten, John (Oxford)
Budgen, Nick	Hill, James	Pattie, Geoffrey
Bulmer, Esmond	Hogg, Hon Douglas (Grantham)	Pawsey, James
Burden, F. A.	Holland, Philip (Carlton)	Percival, Sir Ian
Butcher, John	Hooson, Tom	Peyton, Rt Hon John
Butler, Hon Adam	Hordern, Peter	Pink, R. Bonner
Cadbury, Jocelyn	Howell, Rt Hon David (Guildford)	Pollock, Alexander
Carlisle, John (Luton West)	Howell, Ralph (North Norfolk)	Porter, George
Carlisle, Kenneth (Lincoln)	Hunt, David (Wirral)	Powell, Rt Hon J. Enoch (S Down)
Carlisle, Rt Hon Mark (Runcorn)	Hunt, John (Ravensbourne)	Price, David (Eastleigh)
Chalker, Mrs Lynda	Hurd, Hon Douglas	Prior, Rt Hon James
Channon, Paul	Irvine, Charles (Cheltenham)	Proctor, K. Harvey
Chapman, Sydney	Jenkin, Rt Hon Patrick	Pym, Rt Hon Francis
Clark, Hon Alan (Plymouth, Sutton)	Johnson Smith, Geoffrey	Raison, Timothy
Clark, Sir William (Croydon South)	Jopling, Rt Hon Michael	Rathbone, Tim
Clarke, Kenneth (Rushcliffe)	Kershaw, Anthony	Rees, Peter (Dover and Deal)
Cockeram, Eric	King, Rt Hon Tom	Renton, Tim
Colvin, Michael	Kitson, Sir Timothy	Rhodes James, Robert
Cope, John	Knight, Mrs Jill	Ridley, Hon Nicholas
Cormack, Patrick	Knox, David	Ridsdale, Julian
Corrie, John	Lamont, Norman	Rifkind, Malcolm
Cosiam, A. P.	Lang, Ian	Roberts. Wyn (Conway)
Cranborne, Viscount	Langford-Holt, Sir John	Ross, Wm. (Londonderry)
Critchley, Julian	Latham, Michael	Rossi, Hugh
Crouch, David	Lawrence, Ivan	Rost, Peter
Dean, Paul (North Somerset)	Lawson, Nigel	Royle, Sir Anthony
Dickens, Geoffrey	Lee, John	Sainsbury, Hon Timothy
Dorrell, Stephen	Lennox-Boyd, Hon Mark	St. John Stevas, Rt Hon Norman
Douglas-Hamilton, Lord James	Lester, Jim (Beeston)	Scott, Nicholas
Dover, Denshore	Lewis, Kenneth (Rutland)	Shaw, Giles (Pudsey)
du Cann, Rt Hon Edward	Lloyd, Ian (Havant & Waterloo)	Shaw, Michael (Scarborough)
Dunn, Robert (Dartford)	Lloyd, Peter (Fareham)	Shelton, William (Streatham)
Durant, Tony	Loveridge, John	Shepherd, Colin (Hereford)
Dykes, Hugh	Luce, Richard	Shepherd, Richard (Aldridge-Br'hills)
Eden, Rt Hon Sir John	Lyeil, Nicholas	Shersby, Michael
Eggar, Timothy	McCrindle, Robert	Silvester, Fred
Elliott, Sir William	Macfarlane, Neil	Sims, Roger
Emery, Peter	MacGregor, John	Skeet, T. H. H.
Fairbairn, Nicholas	MacKay, John (Argyll)	Smith, Dudley (War. and Leam'ton)
Fairgrieve, Russell	McNair-Wilson, Michael (Newbury)	Speed, Keith
Faith, Mrs Sheila	McNair-Wilson, Patrick (New Forest)	Speller, Tony
Farr, John	McQuarrie, Albert	Spence, John
Fell, Anthony	Madel, David	Spicer, Jim (West Dorset)
Fenner, Mrs Peggy	Major, John	Spicer, Michael (S Worcestershire)
Fisher, Sir Nigel	Marland, Paul	Squire, Robin
Fletcher, Alexander (Edinburgh N)	Marshall, Michael (Arundel)	Stainton, Keith
Fletcher-Cooke, Charles	Marten, Neil (Banbury)	Stanbrook, Ivor
Fookes, Miss Janet	Mates, Michael	Stanley, John
Forman, Nigel	Mather, Carol	Steen, Anthony
Fowler, Rt Hon Norman	Maude, Rt Hon Angus	Stevens, Martin
Fox, Marcus	Mawby, Ray	Stewart, Ian (Hitchin)
Fraser, Rt Hon H. (Stafford & St)	Mawhinney, Dr Brian	Stewart, John (East Renfrewshire)
Fraser, Peter (South Angus)	Maxwell-Hyslop, Robin	Stokes, John
Fry, Peter	Mayhew, Patrick	Stradling Thomas, J.
Galbraith, Hon T. G. D.	Mellor, David	Tapsell, peter
Gardiner George (Reigate)	Meyer, Sir Anthony	Taylor, Robert (Croydon NW)
Gardner, Edward (South Fylde)	Miller, Hal (Bromsgrove & Redditch)	Temple-Morris, Peter
Garel-Jones, Tristan	Mills, Iain (Meriden)	Thatcher, Rt Hon Mrs Margaret
Gilmour, Rt Hon Sir Ian	Mills, Peter (West Devon)	Thomas, Rt Hon Peter (Hendon S)
Glyn, Dr Alan	Miscampbell, Norman	Thompson, Donald
Goodlad, Alastair	Mitchell, David (Basingstoke)	Thornton, Malcolm
Gorst, John	Moate, Roger	Townend, John (Bridlington)
Gow, Ian	Molyneaux, James	Townsend, Cyril D. (Bexleyheath)
Gower, Sir Raymond	Monro, Hector

Trippier, David	Ward, John	Wilkinson, John
Trotter, Neville	Warren, Kenneth	Williams, Delwyn (Montgomery)
Vaughan, Dr Gerard	Watson, John	Winterton, Nicholas
Viggers, Peter	Wells, John (Maidstone)	Wolfson, Mark
Waddington, David	Wells, Bowen (Hert'rd & Stev'nage)	Young, Sir George (Acton)
Wakeham, John	Wheeler, John	Younger, Rt Hon George
Waldegrave, Hon William	Whitelaw, Rt Hon William
Walker, Rt Hon Peter (Worcester)	Whitney, Raymond	TELLERS FOR THE NOES:
Walker, Bill (Perth & E Perthshire)	Wickenden, Keith	Mr. Spencer Le Marchan' and
Walker-Smith, Rt Hon Sir Derek	Wiggin, Jerry	Mr. Anthony Berry.
Walters, Dennis

Question accordingly negatived.