BL (Privatisation) (Hansard, 21 November 1984)

§ 1. Mr. Grylls
asked the Secretary of State for Trade and Industry what further plans he has to privatise parts of BL.

§ The Minister of State, Department of Trade and Industry (Mr. Norman Lamont)
Further privatisation of BL will be one of the matters dealt with in the company's 1985 corporate plan, which I expect to receive shortly.

§ Mr. Grylls
Does my hon. Friend accept that the original merger into British Leyland, inspired by the then Labour Government, has been at the heart of BL's problems over these long years? Does he also accept that it will be denationalised only if the individual companies are returned to the private sector? With respect, may I ask my hon. Friend and his Department to show a little more speed, following the successful flotation of Jaguar, in returning some of the remaining parts, such as Unipart and Land Rover, to the private sector so that they can prosper better than they do now?

§ Mr. Lamont
I agree that if all the different businesses which today comprise BL had not been drawn together, we might not face many of the severe problems that we have. I also agree with my hon. Friend about the successful privatisation of Jaguar, which we want to follow up with more privatisation. Plans are being prepared for the privatisation of Unipart. The board is also looking at firm plans, which will be put to the Government, for the privatisation of other parts of BL. Our objective is that all the parts of BL should be returned to the private sector.

§ Mr. Campbell-Savours
If the Government are forced down that highly irresponsible route, will far more consideration be given to the issue price of the shares? Did the Government read the report of the Public Accounts Committee on the sale of public assets on previous occasions? If so, why are British Telecom shares selling at a premium of 20 per cent. in the City today? What will the Government do to stop that?

§ Mr. Speaker
Order. The question relates to the privatisation of BL.

§ Mr. Lamont
Thank you, Mr. Speaker, for directing the hon. Gentleman to make his points more relevant.
It is easy to comment on the share price of Jaguar after the event. At the time of the flotation many people wondered whether that price had been pitched correctly, precisely because the stock market had gone through a shaky period. I believe that it was pitched correctly, and it was a successful flotation. The hon. Gentleman is worried because the Jaguar stock market price has risen further. The Labour party gets glummer and glummer as things get better and better.

§ Mr. Alan Howarth
Will my hon. Friend give the House some idea of the progress being made by British Leyland towards the privatisation of the bus and truck division? As there is still no likely prospect of that division being disposed of as a whole, will my hon. Friend assure us that vigorous efforts will be made to dispose of parts of the division to the private sector? Does he recognise that as willing buyers, even for loss-making parts of British Leyland businesses, are available in the private sector it is not good enough to wait until BL comes up with its own proposals for privatisation'? There is considerable impatience—

§ Mr. Speaker
Order. I think that that is enough.

§ Mr. Lamont
My hon. Friend has written to me on several occasions about the parts of British Leyland where some changes—[Interruption.] That is perfectly proper. My hon. Friend is rightly looking for people who can help us in our policy of privatisation. My right hon. Friend the Secretary of State made a statement some months ago backing the British Leyland board's plan for Leyland Vehicles and saying that we endorsed that strategy. As we have endorsed that strategy, we are not inclined to sell individual bits within the trucks business. We have committed ourselves to the pursuit of that plan. However, I assure my hon. Friend that we have told the board of British Leyland that privatisation is the objective, arid the board is preparing firm plans for that.

§ Mr. Wrigglesworth
Is not the most important objective that British Leyland should return to its position as the most substantial volume producer of cars in this country? Does the Minister agree that if the company is to do that it will have to beat the competition from overseas and that, whether British Leyland is in the private sector or in the public sector, that strategy is the most important factor? What are the Government doing to help BL to achieve that objective?

§ Mr. Lamont
That is always the line of the SDP whether a company is in public or private ownership. We do not agree with that. We believe that a company has a better chance of being competitive and efficient and of creating jobs if it is in the private sector. We intend to return all the parts of British Leyland to the private sector.

§ Mr. Williams
A few moments ago the Minister said that he accepted that the mergers were at the heart of the problems facing British Leyland. Is it not a fact that those mergers took place when the companies were in private hands? On the Minister's basic doctrinal point, if private enterprise is so self-evidently successful and public ownership is so self-evidently undesirable, why did Ministers allow the Bank of England to take over Johnson Matthey?

§ Mr. Lamont
As I recall, the right hon. Member for Chesterfield (Mr. Benn) and the Industrial Reorganisation Corporation were much involved in some of the operations which brought the different parts of British Leyland together. The right hon. Member for Swansea, West (Mr. Williams) cannot disclaim responsibility by claiming that it happened without Government influence. Governments were involved in creating the monolith of British Leyland. It comprises many different businesses, and the problems that they face are often markedly different.