HC Deb 19 December 1984 vol 70 cc284-5
9. Mr. Christopher Hawkins

asked the Secretary of State for Trade and Industry if he has plans to seek to promote wider ownership of shares in British industry.

The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Alex Fletcher)

We have just completed the biggest single step so far this century towards wider ownership of shares in British industry. More than 2 million people purchased BT shares, including many first-time investors and 184,000 employees of BT. We shall continue to encourage wider ownership of shares by employees and by individual investors.

Mr. Hawkins

Is my hon. Friend aware of the pleasure that most Conservative Members feel at the success of the British Telecom sale? Is he further aware that we hope that the Government will pursue a policy of extending share ownership to a wider proportion of the British public?

Mr. Fletcher

I am grateful for my hon. Friend's remarks. The Government will take his advice, not least through more privatisation.

Mr. Wrigglesworth

Does the Minister agree that, in addition to the generous price at which BT shares were offered to the public, one reason for the great success of the sale was the change in marketing and the determined effort made publicly to sell those shares? When the Government prepare their White Paper on investment protection, will they examine the old legislation and, while ensuring investor protection, try to relax the rules on advertising and on prospectuses to ensure that similar efforts can be made for other share sales?

Mr. Fletcher

As the hon. Gentleman will know, we are planning to replace the existing Prevention of Fraud (Investments) Act 1958. That will be the subject of a White Paper to be published early next year. We have learnt two lessons from the British Telecom privatisation: first, that there are many hundreds of thousands of willing investors in Britain; and, secondly, the stockbroking profession has learnt that by advertising its wares on a much bigger scale than usual it can ensure that those who wish to buy shares, including small investors, can do so.

Mr. Hanley

While congratulating my hon. Friend on the success of the British Telecom issue, and on the fact that nearly 2 million people are shareholders for the first time, including more than 180,000 employees of British Telecom, may I ask whether he has considered an education programme for the new shareholders in the light of today's press reports that some understand the nature of a contract on the Stock Exchange? Will my hon. Friend consider running a programme of education about the nature of share ownership in conjunction with the Stock Exchange?

Mr. Fletcher

I am almost tempted, in a lighthearted way, to ask my hon. Friend whether he might not have an interest in such an educational programme. The sale of shares in this way and on such a scale is an educational programme in itself for the whole country, and not least for the Opposition parties.

Mr. Williams

In view of the Minister's pleasure at the sale of BT, will he tell us whether he would be pleased with, and would re-employ, a broker who sold his shares for half price—or would he run to a solicitor to take action for incompetence and negligence?

Mr. Fletcher

With respect to the right hon. Gentleman, he has the wrong end of the stick. It is incorrect to conclude that the whole offer can be made at today's price or at the level of any increase in price since the offer was made. The current price reflects the marginal demand — that is the excess of willing buyers over willing sellers. That has always been the case in an issue such as this.