§ Mr. Peter Lloyd (Fareham)I beg to move,
That leave be given to bring in a Bill to set up a committee to review the original terms of compensating the former owners of the assets nationalised by the Aircraft and Shipbuilding Industries Act 1977; and to propose more just and equitable arrangements.It is impossible to bring this matter to a just and equitable conclusion under the Act as it stands because the Act restricts compensation for the companies concerned to their average stock market prices in the six months ending February 1974—a date that I know is engraved on many hearts. Stock market prices have no direct relationship to the real value of the underlying assets; and, in particular, the sectors concerned in that reference period were particularly depressed by the threat of nationalisation and by the first of the long series of oil crises by which the country had just been hit.Thus, for a number of the companies taken into public ownership under the Act the compensation on the formula contained in the Act was far below their net worth. For instance, Vosper's, in my constituency, has been offered £4½ million for its warship building and ship repairing assets which on vesting day were worth more than £25 million, including £5½ million cash in the bank. In this matter the previous Government acted like nothing so much as a humorous burglar who having made off with the family valuables then offered the family compensation from the housekeeping money that he had snatched from the sideboard on the way out. Other companies, including Vickers, Yarrow and GEC, have a similar tale to tell.
The simple remedy I would have proposed is a straightforward amendment in so far as anything in these complex matters can ever be simple and straightforward. That amendment would have given each of the former owners the choice of keeping to the original terms of the 1977 Act or of opting for compensation based upon the company's net asset value on vesting day. I do not propose that because I was advised by the Public Bill Office that, as that would almost certainly mean extra 1511 spending by the Government, it would constitute a money Bill and would therefore be out of order.
Therefore, I am reduced to proposing that a committee should review the matter. But I am quite confident that, if the members of that committee have a modicum of objectivity and a modicum of fairness, they will not be able to avoid coming to similar conclusions about what is the right thing to do. I am sure that the majority of hon. Members—certainly my right hon. and hon. Friends—are convinced that the original Act is defective. However, I know that some of my hon. Friends fear that correcting the injustice contained in the Act will merely create new injustices.
First, there could be injustice between those companies that accepted the 1977 terms and those that did not. As I said earlier, every company, whether it has settled or not, could have the option that I briefly described. It would be the same for all companies and there would be no discrimination. Secondly, there is the fear of injustice between those who have bought and those who have sold shares in the former parent companies. But that worry ignores the fact that, under the scheme that the committee may well propose, no one would be worse off. That worry also forgets that in every stock market transaction each party has to take a host of uncertain factors into account.
In this case the buyers and the sellers would have had to make a judgment on the likelihood or otherwise of improved compensation being offered. They had to make a guess one way or the other. They could not avoid that, because nothing was definite in the matter.
The Conservative Opposition at the time trenchantly criticised the Act when it went through Parliament in 1977 and they never ruled out the possibility of subsequent amendment. True, they did not promise amendment, either. The matter was left wide open, and wide open it remains today. Moreover, that fear of creating new injustices underestimates the widespread assumption that such flagrantly unfair terms must eventually be superseded, as witness the steadfast refusal of the most profitable and, therefore, the most heavily penalised companies involved to settle, though they 1512 could well have done with the extra cash, however meagre, over the last year or two. It is not justice but injustice that is almost entirely on the side of leaving things as they are.
There is, too, a healthy reluctance to legislate retroactively, but it is surely the creation of retrospective penalties and obligations which is anathema, not retrospective compensation arrangements to remedy a clear-cut wrong. There are a number of examples of that that we can all applaud in other spheres.
It would not even be a case of establishing a new basis for compensation; it would be a case of returning to the earlier practice set by Herbert Morrison in the post-war Labour Government. That had long ensured that former owners of companies taken into public ownership were always fully compensated on an agreed basis. That practice was later enshrined internationally in the Washington agreement to which the United Kingdom is a signatory.
However, in the 1977 Act that basic principle was abruptly abandoned in favour of new arrangements which meant virtual confiscation for some of the affected companies. Since then, foreigners have had better protection for their property rights in the United Kingdom than have United Kingdom citizens though British citizens may, in due course, obtain judgments in their favour in the European Court of Human Rights at Strasbourg. That court is now being petitioned by an ex-shareholder on the ground, among others, that the Act contravenes Britain's own pleadings on other occasions in the International Court of Justice.
With all the worry and concern about precedent in these matters, it would surely create an extremely poor precedent if we were to allow this injustice and discrimination to continue uncorrected. For that reason, in particular, I beg leave to introduce the Bill.
§ Dr. David Clark (South Shields)I shall be brief in opposing this proposed Bill. I hope that the House will not give it a First Reading. I claim that it is impracticable, unnecessary, unfair and extremely provocative to tens of thousands of workers in the industry.
I argue that the Bill is impracticable 1513 and unfair on a number of grounds. Hon. Members might be aware that the majority of companies that were taken into public ownership in 1977, after many hours of debate in Committee and in the House, have agreed—I repeat agreed—terms with the Government. Of that majority, 10 agreed terms under the previous Labour Government and one only has agreed terms under this Government. If there has been a delay, it has been caused by the reluctance of this Government to come to an agreed—I repeat agreed—settlement with the outstanding companies. That is one reason why I think that this Bill is unnecessary.
The hon. Member for Fareham (Mr. Lloyd) argues for the setting up of a committee. There is no need for a committee. Under the 1977 Act there is provision for arbitration procedure by which an independent judgment can be obtained. Indeed, there is at least one company involved in arbitration at the moment. Therefore, I say that a committee is unnecessary.
I also argue that the Bill is deeply provocative and is irrelevant to the industry. As the Minister responsible will bear witness—he has visited the industry on many occasions—this is one British industry in which management and workers have worked side by side with a great deal of flexibility to make a success of the industry. The Minister has repeatedly said that from the Dispatch Box. That success will be threatened if a feeling develops that one group of previous owners will receive preferential treatment. I ask the House to consider that key issue.
Conservative Members may disagree but they do not represent constituencies on the Tyne, the Clyde or the Mersey where tens of thousands of people are out
§ of work. Government Members are not interested in the fact that one in five men in my constituency is out of work. They are interested only in the former shareholders.
§ I maintain that the shipbuilding industry, like every other industry, is a partnership between capital and labour.
§ Mr. Maurice Macmillan (Farnham)Will the hon. Gentleman give way?
§ Dr. ClarkI do not have time to give way.
If we impose an extra financial burden on the industry, we shall weaken morale and make it more difficult for the industry to succeed. The management set a target of 45 ships. Many people said that that was an impossible target, but it was reached with little assistance from the Government. Management and labour did a magnificent job.
The hon. Member for Fareham said that he wanted to go back to the Attlee-Morrison formula for nationalisation. Many thousands, if not millions, of people believe that if there was one fault in the 1947 and 1948 Acts to nationalise industries it was that they were too generous to the owners. That is the feeling in the country. The 1977 Act sets a formula for a fairer balance between the shareholders and the workers. The 1977 Act provides a fair basis, and I ask the House to reject the Bill.
§ Question put, pursuant to Standing Order No. 13 (Motions for leave to bring in Bills and nomination of Select Committees at Commencement of public business):—
§ The House divided: Ayes 153, Noes 160.
1517| Division No. 404] | AYES | [4.32 pm |
| Adley, Robert | Braine, Sir Bernard | Dunn, Robert (Dartford) |
| Aitken, Jonathan | Bright, Graham | Durant, Tony |
| Alexander, Richard | Brinton, Tim | Eden, Rt Hon Sir John |
| Alton, David | Brocklebank-Fowler, Christopher | Eggar, Timothy |
| Amery, Rt Hon Julian | Brotherton, Michael | Faith, Mrs Sheila |
| Ancram, Michael | Brown, Michael (Brigg & Sc'thorpe) | Farr, John |
| Atkinson, David (B'mouth, East) | Browne, John (Winchester) | Fisher, Sir Nigel |
| Baker, Nicholas (North Dorset) | Bruce-Gardyne, John | Fletcher-Cooke, Charles |
| Banks, Robert | Buck, Antony | Fookes, Miss Janet |
| Beaumont-Dark, Anthony | Butcher, John | Forman, Nigel |
| Bell, Ronald | Carlisle Kenneth (Lincoln) | Fraser, Rt Hon H. (Stafford & St) |
| Bendall, Vivian | Chapman, Sydney | Fraser, Peter (South Angus) |
| Benyon, W. (Buckingham) | Churchill, W. S. | Freud, Clement |
| Best, Keith | Clark, Hon Alan (Plymouth, Sutton) | Fry, Peter |
| Bevan, David Gilroy | Colvin, Michael | Galbraith, Hon T. G. D. |
| Blackburn, John | Corrie, John | Garel-Jones, Tristan |
| Body, Richard | Dorrell, Stephen | Glyn, Dr Alan |
| Bonsor, Sir Nicholas | Dover, Denshore | Grant, Anthony (Harrow C) |
| Bowden, Andrew | Dunlop, John | Greenway, Harry |
| Grieve, Percy | Meyer, Sir Anthony | Smith, Cyril (Rochdale) |
| Griffiths, Peter (Portsmouth N) | Mills, Iain (Meriden) | Smith, Dudley (War. and Leam'ton) |
| Gummer, John Selwyn | Mills, Peter (West Devon) | Spence, John |
| Hamilton, Hon Archie (Eps'm &Ew'll) | Moate, Roger | Spicer, Jim (West Dorset) |
| Hamilton, Michael (Salisbury) | Molyneaux, James | Spicer, Michael (S Worcestershire) |
| Hannam, John | Montgomery, Fergus | Sproat, Iain |
| Hawksley, Warren | Morgan, Geraint | Stanbrook, Ivor |
| Heddle, John | Morris, Michael (Northampton, Sth) | Steel, Rt Hon David |
| Hill, James | Morrison, Hon Charles (Devizes) | Steen, Anthony |
| Holland, Philip (Carlton) | Mudd, David | Stewart, John (East Renfrewshire) |
| Hordern, Peter | Murphy, Christopher | Stokes, John |
| Howell, Ralph (North Norfolk) | Myles, David | Tapsell, Peter |
| Howells, Geraint | Neale, Gerrard | Temple-Morris, Peter |
| Hunt, John (Ravensbourne) | Needham, Richard | Thomas, Rt Hon. Peter (Hendon S) |
| Jessel, Toby | Nelson, Anthony | Townsend, Cyril D. (Bexleyheath) |
| Johnson Smith, Geoffrey | Neubert, Michael | Trippier, David |
| Kaberry, Sir Donald | Onslow, Cranley | Wainwright, Richard (Colne Valley) |
| Kellett-Bowman, Mrs Elaine | Osborn, John | Waldegrave, Hon William |
| Knight, Mrs Jill | Page, John (Harrow, West) | Walker, Bill (Perth & E Perthshire) |
| Lang, Ian | Patten, John (Oxford) | Wall, Patrick |
| Lawrence, Ivan | Pawsey, James | Waller, Gary |
| Lee, John | Penhaligon, David | Walters, Dennis |
| Lennox-Boyd, Hon Mark | Pink, R. Bonner | Ward, John |
| Lewis, Kenneth (Rutland) | Pollock, Alexander | Wells, John (Maidstone) |
| Lloyd, Peter (Fareham) | Proctor, K. Harvey | Wheeler, John |
| Loveridge, John | Rees-Davies, W. R. | Wickenden, Keith |
| Lyell, Nicholas | Renton, Tim | Williams, Delwyn (Montgomery) |
| MacKay, John (Argyll) | Rhys Williams, Sir Brandon | Winterton, Nicholas |
| Macmillan, Rt Hon M. (Farnham) | Ridsdale, Julian | Wolfson, Mark |
| McNair-Wilson, Michael (Newbury) | Ross, Wm. (Londonderry) | |
| McQuarrie, Albert | Sainsbury, Hon Timothy | TELLERS FOR THE AYES: |
| Marland, Paul | Shepherd, Colin (Hereford) | Mr. Michael Grylls and |
| Mawhinney, Dr Brian | Shepherd, Richard (Aldridge-Br'hills) | Mr. William Shelton. |
| Maxwell-Hyslop, Robin | ||
| NOES | ||
| Abse, Leo | Forrester, John | Mason, Rt Hon Roy |
| Adams, Allen | Foster, Derek | Maynard, Miss Joan |
| Allaun, Frank | Foulkes, George | Mikardo, Ian |
| Anderson, Donald | Garrett, John (Norwich S) | Miller, Dr M. S. (East Kilbride) |
| Ashton, Joe | Garrett, W. E. (Wallsend) | Mitchell, Austin (Grimsby) |
| Bagier, Gordon A. T. | Graham, Ted | Mitchell, R. C. (Soton, Itchen) |
| Bennett, Andrew (Stockport N) | Grant, George (Morpeth) | Morris, Rt Hon Alfred (Wythenshawe) |
| Bottomley, Rt Hon Arthur (M'brough) | Grant, John (Islington C) | Morris, Rt Hon Charles (Openshaw) |
| Bradley, Tom | Hamilton, James (Bothwell) | Morris, Rt Hon John (Aberavon) |
| Bray, Dr Jeremy | Hamilton, W. W. (Central Fife) | Morton, George |
| Brown, Ronald W. (Hackney S) | Hardy, Peter | Moyle, Rt Hon Roland |
| Brown, Ron (Edinburgh, Leith) | Harrison, Rt Hon Walter | Newens, Stanley |
| Buchan, Norman | Hattersley, Rt Hon Roy | O'Halloran, Michael |
| Callaghan, Rt Hon J. (Cardiff SE) | Haynes, Frank | O'Neill, Martin |
| Callaghan, Jim (Middleton & P) | Healey, Rt Hon Denis | Orme, Rt Hon Stanley |
| Campbell-Savours, Dale | Heffer, Eric S. | Parker, John |
| Canavan, Dennis | Hogg, Norman (E Dunbartonshire) | Parry, Robert |
| Cant, R. B. | Homewood, William | Pavitt, Laurie |
| Carmichael, Neil | Horam, John | Powell, Raymond (Ogmore) |
| Carter-Jones, Lewis | Howell, Rt Hon Denis (B'ham, Sm H) | Race, Reg |
| Clark, Dr. David (South Shields) | Huckfield, Les | Rees, Rt Hon Merlyn (Leeds South) |
| Cocks, Rt Hon Michael (Bristol S) | Hughes, Robert (Aberdeen North) | Richardson, Jo |
| Cohen, Stanley | John, Brynmor | Roberts, Ernest (Hackney North) |
| Coleman, Donald | Johnson, James (Hull West) | Roberts, Gwilym (Cannock) |
| Concannon, Rt Hon J. D. | Jones, Rt Hon Alec (Rhondda) | Rooker, J. W. |
| Conlan, Bernard | Jones, Dan (Burnley) | Roper, John |
| Cook, Robin F | Kaufman, Rt Hon Gerald | Ross, Ernest (Dundee West) |
| Cowans, Harry | Kerr, Russell | Rowlands, Ted |
| Cox, Tom (Wandsworth, Tooting) | Kilroy-Silk, Robert | Sandelson, Neville |
| Cryer, Bob | Lambie, David | Sheerman, Barry |
| Cunningham, Dr John (Whitehaven) | Lamond, James | Silkin, Rt Hon John (Deptford) |
| Dalyell, Tam | Leighton, Ronald | Silverman, Julius |
| Davis, Clinton (Hackney Central) | Lester, Miss Joan (Eton & Slough) | Skinner, Dennis |
| Davis, Terry (B'rm'ham, Stechford) | Lewis, Ron (Carlisle) | Smith, Rt Hon J. (North Lanarkshire) |
| Dempsey, James | Litherland, Robert | Soley, Clive |
| Dewar, Donald | Lofthouse, Geoffrey | Spearing, Nigel |
| Dormand, Jack | Lyons, Edward (Bradford West) | Spriggs, Leslie |
| Douglas-Mann, Bruce | McDonald, Dr Oonagh | Stallard, A. W. |
| Dubs, Alfred | McKay, Allen (Penistone) | Stoddart, David |
| Eadie, Alex | McKelvey, William | Stott, Roger |
| Edwards, Robert (Wolv SE) | MacKenzie, Rt Hon Gregor | Strang, Gavin |
| Ennals, Rt Hon David | McNally, Thomas | Straw, Jack |
| Evans, Ioan (Aberdare) | McNamara, Kevin | Summerskill, Hon Dr Shirley |
| Evans, John (Newton) | McTaggart, Robert | Taylor, Mrs Ann (Bolton West) |
| Field, Frank | McWilliam, John | Thomas, Dafydd (Merioneth) |
| Fitt, Gerard | Marshall, David (Gl'sgow, Shettles'n) | Thomas, Dr Roger (Carmarthen) |
| Flannery, Martin | Marshall, Dr Edmund (Goole) | Thorne, Stan (Preston South) |
| Foot, Rt Hon Michael | Marshall, Jim (Leicester South) | Tilley, John |
| Tinn, James | Welsh, Michael | Winnick, David |
| Torney, Tom | White, Frank R. (Bury & Radcliffe) | Woolmer, Kenneth |
| Urwin, Rt Hon Tom | Whitlock, William | |
| Varley, Rt Hon Eric G. | Wigley, Dafydd | [...]ELLERS FOR THE NOES |
| Walker, Rt Hon Harold (Doncaster) | Willey, Rt Hon Frederick | Mr. Don Dixon and |
| Watkins, David | Williams, Rt Hon Alan (Swansea W) | Mr. John Home Robe[...]s |
| Weetch, Ken | Williams, Sir Thomas (Warrington) |
§ Question accordingly negatived.
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- BUSINESS OF THE HOUSE 44 words