Laker Airways (Hansard, 1 March 1982)

§ 9. Mr. Ginsburg
asked the Secretary of State for Trade what is the position of the route licences granted to Laker Airways and held by it prior to the receivership; and if he will make a statement about its current status.

§ Mr. Sproat
The Civil Aviation Authority has given notice to Laker Airways that its air transport licences are suspended. However, whether the suspension takes effect and, if so, the timing of it, depends on whether the airline appeals to my right hon. Friend and on the outcome of any appeal. I understand that the authority has also notified the airline that it intends to publish particulars of a proposal to revoke the licences; this proposal may be the subject of a hearing and subsequently of an appeal to my right hon. Friend, so it would not be appropriate for me to comment further.

§ Mr. Ginsburg
No doubt the Minister recalls that on 9 February the Prime Minister spoke about the possibility of de-suspension. Will he confirm that such de-suspension could not take place unless the airline were sold in its entirety as a going concern, with due consideration for the outstanding debts?

§ Mr. Sproat
The hon. Gentleman has asked an extremely intricate question. I cannot answer "Yes", but I can say that this matter is for the Civil Aviation Authority to decide. It will, of course, take account of the financial state of the company, or any reconstructed company. In addition, it is taking advice on whether the suggested reconstructed company—Brenpage—qualifies under regulation 17.

§ Mr. McCrindle
Given that the Minister's appellate functions require him to be somewhat circumspect when replying to my question, can he at least place on record the Government's hope that, after all the inquiries, two British airlines will still fly both to Los Angeles and New York?

§ Mr. Sproat
It would be improper for me to say more than to remind my hon. Friend that an application from British Caledonian and, presumably, from any reconstructed Laker Airways—if it is reconstructed—to fly to Los 10 Angeles would be the subject of an appeal to my right hon. Friend the Secretary of State. Therefore, I should not comment.

§ Mr. Hoyle
Will the Minister ensure that a pirate like Laker does not fly again? Sir Freddie Laker paid less in salaries than other airlines and had a registered office in Jersey so that his employees did not have the benefit of going to industrial tribunals. Indeed, Sir Freddie Laker prevented his employees from joining a trade union. The result has been that all of them have lost their employment. Will the Minister protect people in future?

§ Mr. Sproat
It is a shocking abuse of the House that the hon. Gentleman uses the privilege of the Green Benches to call Sir Freddie Laker a pirate. The hon. Gentleman said that Jersey was being used as a way to get round section 15 of the Act, to which I presume he was referring. As usual, the hon. Gentleman is totally inaccurate.

§ Mr. Kenneth Lewis
Sir Freddie Laker did a good deal of good work in the early days, but is the Minister aware that the worst feature of the misfortunes was that so many people who were booked on scheduled flights lost their money? Therefore, is there not a need for cover by the air travel reserve fund, bonding or insurance to make sure that if an airline goes bust—as British Airways could now. if it were not nationalised—such people are protected?

§ Mr. Sproat
With regard to my hon. Friend's point about scheduled passengers, I ask him to wait until question 15 is answered, when I hope he will receive a satisfactory answer.

§ Mr. John Smith
Does the Under-Secretary agree, as a matter of general civil aviation licensing policy, that it would not be proper for an airline operator to be able to walk away from hundreds of millions of pounds of debt at home and abroad and then to start operating a licence again without having made any arrangements to pay those debts?

§ Mr. Sproat
The right hon. Gentleman is putting a hypothetical question to which it would not be proper for me to give an answer. With regard to the laws of receivership, it is the duty of the receiver to get as much money as possible for the creditors. That is what Mr. Mackey and his associates are doing.