British Airports Authority

HC Deb 16 March 1987 vol 112 cc683-4

Mr. Hubbard-Miles

asked the Secretary of State for Transport what representations he has received about progress in the privatisation of the British Airports Authority.

Mr. Moore

Preparations for the privatisation of BAA plc are progressing well. The privatisation is planned for June-July this year.

Mr. Hubbard-Miles

I am grateful to my right hon. Friend. What, if any, special arrangements have been made for employee shares?

Mr. Moore

The 7,200-plus employees will be involved in the issue. They will be eligible for about £100 worth of shares at no cost, at the time of flotation. In addition, the Government will provide two free shares for each share purchased by an employee up to a maximum of about £400 of free shares for £200 purchased. All employees and pensioners of BAA plc will be able to apply on a priority basis for shares at the offer price.

Mr. Robert Hughes

Have the Government learnt any lessons from the sale of British Airways, in which a great deal of public money was lost? Or has the right hon. Gentleman been reminded by the Prime Minister of a statement that she made to the House in April 1968, when she said that it would be Conservative party policy to sell off public assets at below their true value?

Mr. Moore

We certainly have learnt lessons from the successful privatisation, of British Airways. The prime lesson is that I am still trying to discover what the Opposition fear most, a further successful privatisation, or a general election.

Mr. Bowen Wells

Will my right hon. Friend advise the House how, when preparing the British Airports Authority for privatisation, he will deal with the loss-making Stansted airport? He will know that a new terminal is being built there. In a recent answer to a question from me he said that the passenger traffic at Stansted is decreasing. Will not the abolition of income from duty-free sales at the airport put BAA totally in the red for a long time ahead? Will he consider curtailing the development at Stansted to prevent that occurring?

Mr. Moore

I cannot accept certain of my hon. Friend's propositions. Like others, he will want to look forward to the detailed prospectus that will appear in advance of the privatisation of BAA, which, as I said, we are looking forward to, successfully, in June-July this year.

Mr. Stephen Ross

May I take it that in the legislation providing for the privatisation of BAA protection will be given to ensure that foreign airlines will not be able to acquire shares and form cartels which might give them some effective control over the future of BAA?

Mr. Moore

I can reassure the hon. Gentleman on that fair point. Provision will be included in the articles of association of the privatised BAA plc restricting the shareholding of any individual or of parties acting in concert to 15 per cent. of the total issued share capital. In addition, the Secretary of State will retain a special share that will give him the right to veto any proposed change in the articles of association.