HC Deb 01 February 1984 vol 53 cc252-4
6. Mr. Winnick

asked the Secretary of State for Trade and Industry if he is satisfied with the operation of the law regarding companies' contributions to political parties.

15. Mr. Lofthouse

asked the Secretary of State for Trade and Industry if he is satisfied with the operation of the law covering the way companies make political contributions.

Mr. Tebbit

Yes, Sir.

Mr. Winnick

Are we really to believe that it is pure coincidence that 60 per cent. of the knighthoods received since 1979 have gone to industrialists who have been associated with companies donating to the Tory party? Why does the Secretary of State not recognise that the manner in which there is no consultation with shareholders, or any involvement by them—they cannot contract out—in making contributions to the Tory party has become quit scandalous?

Mr. Tebbit

I suspect that about 100 per cent. of the knighthoods given to trade unionists by the last Labour Government were given to people associated with support for the Labour party. I think that knighthoods for people in commercial life are given to those who have shown outstanding success in commerce and industry. That frequently means that they happen to believe in the capitalist free market economy, which often means that they are members, or supporters, of the Conservative party as well.

As to the hon. Gentleman's other question, he knows perfectly well what the state of the law is, and he knows perfectly well too that, in relation to shareholders' funds, and particularly dividends, the amounts of money concerned are trivial.

Mr. Lofthouse

Is the Secretary of State aware that, as I do not think there are any hon. Members on the Front Bench whose names are associated with the list of Nazis and Fascists, we expect a fair answer in the House this afternoon? Does he not think that shareholders have the same right to contract out as trade unionists? Why is he so concerned about trade unionists' donations to the Labour party when he does not apply the same criterion to shareholders?

Mr. Tebbit

It is clear that shareholders have the right to decide whether to contribute to political funds. They have the medium of the annual general meeting to impose a restriction on a company if they so wish. If not, they do not. There is no great demand for reform from shareholders, although there have been very strong demands for reform from trade unionists. Indeed, many trade unionists are conscripted into the unions to which they belong.

Mr. Viggers

Is my right hon. Friend aware that I have been associated with several companies which have made political donations from time to time? Many shareholders have commended the donations made. The only complaint that I received was when one company, against my advice, donated to the Labour party.

Mr. Tebbit

I am not really surprised.

Mr. Wrigglesworth

The Government are apparently not going to change the law on company political contributions. Are they also coming to the conclusion that they should not change the law on trade union political levies, just at they sold out on the question of personal ballots in the Trade Union Bill?

Mr. Tebbit

I am sure that the hon. Member for Stockton, South (Mr. Wrigglesworth) knows that if he wants to ask questions about that Bill and allied legislation, he can ask my right hon. Friend the Secretary of State for Employment at the appropriate time.

Mr. Shore

The Secretary of State is rather easily satisfied about the law relating to companies and contributions to political parties. The right hon. Gentleman seems not to have understood or given his mind to the question. When he speaks about individuals in companies being shareholders who have the right to contract out or in, one would imagine that we were still living in the period before the first world war when the great mass of shareholders consisted of individuals. What does the right hon. Gentleman have to say about the fact that about half of all the shares owned in Britain are held by institutions, superannuation and insurance companies, over which individual subscribers have no control whatever? Let us not pretend that the two situations are the same.

Mr. Tebbit

I have looked into this matter from a personal point of view, as I am a member of the British Airways pension scheme. At present that fund is valued at about £1.5 billion. I have analysed the scheme's holdings, and the total cost of the political contributions made by the British companies in which it has its 10 largest investments amounted to £100.60. That amount will not cause much loss of sleep to the scheme's 53,000 members and beneficiaries.

Mr. Shore

rose—

Mr. Speaker

Order. I call Front Bench Members frequently, but it reduces the amount of time available to Back Benchers.