HC Deb 20 February 1989 vol 147 cc771-87
Mr. Wilson

I beg to move amendment No. 15, in page 5, line 3, after 'in', insert 'and remain with'.

I shall adopt the same formula for this small amendment, which takes us on to the part of the Bill dealing with Caledonian MacBrayne. At present, the ownership of Caledonian MacBrayne rests with the Secretary of State and that should be perpetuated in another form under the Bill. It is not necessary to say more than that.

Lord James Douglas-Hamilton

The aim of the amendment is to require the ownership of Caledonian MacBrayne to remain with the Secretary of State.

It might be helpful if I set out our policy towards shipping services to the Western Isles. We are committed to maintaining at least the present standard of service. This is a standard which has been substantially improved since we came to office. Our manifesto commitment was to continue the substantially increased financial support for the provision and upgrading of ferries and terminals which are so vital to the islands". The evidence of that commitment is in the new ships and piers and substantially improved facilities.

In the light of the dissolution of the transport group, of which Caledonian MacBrayne is part, the Secretary of State decided, having examined the options carefully, that the best arrangement was for Caledonian MacBrayne to become a company owned, in the first instance, by the Secretary of State. He will be appointing a new board for the company, which will be asked to examine carefully existing practices in order to find more efficient and cost-effective ways of delivering the present standard of service. The Secretary of State said that no options for the longer term would be excluded, subject of course to the overriding proviso that they must ensure at least the present quality of service to the islands.

Having set out the background and our commitment to services, it would be odd to specify in statute that a company transferred to the Secretary of State should remain with him in perpetuity. Within the context of looking for better value for money, we do not know what arrangements might be proposed by the board, always subject to the overriding proviso of maintaining at least the present quality of service. We want to avoid limitations on arrangements which might be in the best interests of the islands, which will always remain the touchstone of any change which is considered. An amendment of this kind would limit the range of options which the new board might want to consider.

In all this it is, of course, the service to the islands which is vitally important, and our commitment to it is clear. I ask the House to reject the amendment.

Mr. Wilson

I only partially stated what the amendment was about and the Minister is right that, in addition to recognising the reality that control rests with the Secretary of State, it looks into the future. It seeks to legislate against the possibility of a change of ownership. On those grounds, the Opposition are disappointed that the Minister will not accept the amendment. Perhaps that gives something away about the Government's long-term thinking. However, we have seen off threats to Caledonian MacBrayne before and we shall see them off again.

Amendment negatived.

Mr. Wilson

I beg to move amendment No. 16, in page 5, line 11, at end insert— '(4A) The Secretary of State shall ensure that the interests of travellers, local people and employees are given representation equal to that of commercial and management interests on the Board of Caledonian MacBrayne Limited.'.

We now come to a more substantial debate on Caledonian MacBrayne and the shipping aspects of the Bill. We have centred the debate round the composition of the board. Although we suspect that the Government would like to do much to Caledonian MacBrayne, the only substantial aspect of the Bill that identifies that company's prospects deals with the creation and composition of a board.

We propose—one might think eminently reasonably—that the interests of travellers, local people and employees should be given equal representation with commercial and management interests on the board. Put in another way, we might call this the NTS amendment. While considering the Bill, we have had to put up with a great many initials such as STG and SDG, and abbreviations such as CalMac. NTS stands, quite simply, for "no Tory sinecures."

We are concerned that the board, which will be crucial to the future of Caledonian MacBrayne and the shipping services on the west coast of Scotland, will be perverted from the start by the sort of political appointments that are increasingly permeating and corrupting public life in Scotland. People with no qualifications, other than a party-political allegiance to Scotland's minority party—the Tory party—are appointed to every board and quango in sight. If that happens with Caledonian MacBrayne's new board, it is certain that the wishes of the people of the west coast communities served by the company will not be respected.

I pointed out in Committee the extraordinary fact that it is now possible to travel from Muckle Flugga to the Mull of Kintyre—the length of the highlands and islands of Scotland—without encountering territory that is represented by a Tory Member. On the 28 routes covered by Caledonian MacBrayne, at no time does one of its vessels call at a port represented by a Tory Member of Parliament.

The reality of politics in Scotland and, more recently, in the areas that this company has served is that the Tories are completely unelectable at local or national level in the west coast areas of Scotland. That is a remarkable fact and, even within my relatively short political lifetime, it represents a remarkable change. Some of the people who have helped to bring it about are here this evening. I pay tribute to the hon. Member for Argyll and Bute (Mrs. Michie) for having put the last piece in the jigsaw to make the highlands and islands a Tory-free zone—and all the better for it. We do not want any of these rejected people or their allies to be brought back to life in a new form.

As was noted in earlier debates, the former Member of this House who represented the constituency of Cunninghame, North before I was elected in June 1987 has already been found a nice little earner as chairman of the Scottish transport users consultative committee. That precedent makes us suspicious about what sort of clapped-out Tory rejects will be put on the board of Caledonian MacBrayne.

Shortly before Christmas, when the privatisation threat still hung over Caledonian MacBrayne, there was a meeting in Oban at which genuine, concerned representatives of our communities came together from all over the west coast. The hon. Member for Argyll and Bute and I were both in attendance, as were about 80 people, united in their opposition to privatisation, because they knew what it would mean for the shipping services on which they depended. They were excellent people who were very representative of our communities and any number of them would have made good members of Caledonian MacBrayne's new board.

For the record, at that meeting just two voices were raised in favour of privatisation. One was that of a Tory councillor from West Kilbride, which, as I pointed out in Committee, is not one of the great nautical centres of the west coast. The other was a British publican from Port Askaig who gave the strong impression of being his own best customer. That was the level of support for privatisation within the community that is served by Caledonian MacBrayne. However, there is no guarantee that those two people, and the other 78 people, will not end up on the board of Caledonian MacBrayne. We shall watch events extremely closely. Again we shall make the Tories pay the political penalty if they try any such tricks.

An arrogance is abroad—led, I think, by the hon. Member for Stirling (Mr. Forsyth)—that makes Scottish Office Tories believe that they can do literally what they like. There is a real touch of the gauleiter about them. They have no electoral base, but they believe that they can carry on as though elections had never taken place and as though they will never take place again. Their cockiness might be justified for the time being, but elections will take place again—assuming that the hon. Member for Stirling does not gain even more influence. At that time, for each of these actions against the wishes and interests of the Scottish people, the Tories will again be made to pay the electoral price. At the moment they nurse the hope of regaining some of the lost lands of the highlands and islands, so in their own political self-interest, as well as in the interests of the people of the highlands and islands, the last thing that they ought to do is to make appointments that would grossly offend those people.

Control of Caledonian MacBrayne is now in the hands of the board of the Scottish Transport Group, which is primarily concerned with bus operations. The board has adopted a hands-off attitude, but that will change. When a board is appointed for the new company, Caledonian MacBrayne Ltd., the question of who the board members are will become relevant.

Lip service has been paid to the notion of islanders being appointed to the board, but I am sure that the Minister recognises that there are islanders and islanders. There are people who have committed their life's work to the island communities that are served by Caledonian MacBrayne and there are others who regard the islands as places to which to go for the occasional highland gathering and the subsequent ball. For instance, they have given Mull the nickname "the officers' mess". We do not want a retired colonel who has set himself up as a mini-laird on one of the islands to be appointed to the board. We do not recognise such people as islanders. What is even more important, the people who live on the islands do not recognise them as islanders.

I know that the Minister has family experience of the kind of appointment that I am talking about. I am sure that he realises that people on the islands are well able to differentiate between those who have a long-term commitment to the islands and those who regard them as an outpost of empire where, preferably, the peasantry ought to be treated as the peasantry of the outposts of empire were once treated. We want those who genuinely represent the folk who travel on the ferries, live in the island communities and work on the ferry services to sit on the board. They would make sound, rational decisions that were motivated by social concern for the communities and by knowledge of local needs.

We have noted at each stage of the Bill that the composition of the board of CalMac will be particularly important early in its life. It has been given two immediate remits by the Secretary of State. We have been told that the new board will be asked to decide on the location of the headquarters of Caledonian MacBrayne. I am pleased to say that in recent weeks the Opposition's views on this matter have become quite clear. We have considered the question of the transfer of the headquarters of Caledonian MacBrayne and we do not like it one little bit. We believe that relocation is a ridiculous requirement to impose on an area where unemployment stands at 27 per cent. It would be an unnecessary burden on the public purse if a new headquarters had to be built in Oban, or anywhere else.

Folk should not be uprooted and disturbed in that way, particularly when no ostensible benefit to the travelling public would be gained. The majority of the travelling public will be at the end of a long-distance telephone call, irrespective of where the headquarters of Caledonian MacBrayne is located. I speak only for my own party when I say that we are firmly against the removal of the CalMac headquarters from Gourock to anywhere else.

7.45 pm

To hark back to the days when David MacBrayne Ltd. was privatised, it is worth remembering that there was an even more complex MacBrayne network of ferry services on the west coast of Scotland. The headquarters of David MacBrayne Ltd. was not in the community that was served by the company. It was in Robertson street, Glasgow. There is a lot of sense in saying that the headquarters of a widely dispersed shipping company should be close to the centre from which many of the services and many of the passengers emanate.

What we as politicians say about that is not the most important aspect. What the people who live in the island communities and who work for the company say is much more important. We do not want a board to be set up that has been told by the Secretary of State to go down a certain road. We want that board to be representative of the communities, to participate in rational debate, to look sympathetically at the interests of employees—as well as at a political wheeze from the Secretary of State—and come to a rational decision.

We have also been told that the new board will be asked to adjudicate at an early stage on the selling off of two routes on the Clyde—Dunoon to Gourock and Wemyss bay to Rothesay. The location of Caledonian MacBrayne's headquarters is more a matter of judgment than politics, but there is no doubt that there is a political aspect to the question of whether those two routes should be sold off.

The experience of the last nine years while this has been a matter of live debate has shown that it will be very difficult to get any CalMac board that has any contact with the communities served by the company to assent to such a proposition.. If the Secretary of State is to obtain the sell-offs that he hankers after, he will achieve them only by putting on the board the placemen and Tory lackeys whom we fear so much. All the power of argument is against the break-up of the network and the selling off of these routes. The economic argument is against it.

If routes are taken out of a subsidised network, the last ones to be taken out are the ones that are the most economically viable—as the Clyde routes are. In that case, either one increases the need for public subsidy of the remaining routes or one reduces the level of services on the remaining routes; they will not have the weighting factor of the relatively good financial performance on the more profitable routes. The economic argument for taking these two routes away from CalMac is completely discredited.

As for the integration of routes and services, the great strength of Caledonian MacBrayne on the west coast of Scotland is its ability to move vessels from one route to another to cover breakdowns, annual overhauls and refits. It is able to co-ordinate timetables and everything else that is connected with the complex Caledonian MacBrayne operation. The strength of integration extends to the booking system. People who are visiting the area can book their way through the Hebrides, across the Clyde, back into Argyll and out again to the Inner Hebrides. All of that is possible with the sophisticated computer-based booking network operated from Gourock. If the Government start playing about by taking loops out of the network and handing them over to some other operator they will lose that advantage as well.

Once again the big argument against privatising these routes is that the people who live in the communities served by them do not want them to be privatised. They made that clear in 1981, when the Government had to retreat in a state of some disarray from the proposal to privatise the Gourock to Dunoon route. I have no evidence to suggest that opinion in Gourock and Dunoon has changed. Equally, I have no doubt that the Government would meet with equally fierce opposition in Wemyss bay and Rothesay.

I might say that both Renfrew, West and In% erclyde and Argyll and Bute, the two constituencies affected by these proposals, are Labour-held marginals. If the Minister wants to ensure larger Labour majorities, I suppose that is one good reason for proceeding with these proposals. But we do not look at these things from a short-term, narrow political standpoint; we look at them from the point of view of the public good. No one wants the Minister's lousy privatisation ideas, and he really should accept that.

The Government have been messing about with this for eight years—confusing and annoying people. They really should go away and do something useful. Their dreadful persistence is an obsession, I think. There must be somewhere in Scotland, some subscriber to Tory funds who is obsessed with the idea of taking over the Clyde shipping services. That is the only possible explanation of the Government's preoccupation with such a relatively minor matter. We do not want these people on the new board of Caledonian MacBrayne either.

There is a clear warning here. Make it a board that is representative of local interests, make it a board that is sensitive to the wishes of the travelling public, and we will welcome it, the people of the communities served will welcome it, and there will be no dispute. But make it another of these nasty little coteries of Tories, appointed on the basis of an old boys' or old girls' network, and further opprobrium will be heaped upon the Scottish Tories—and I should have thought they had enough opprobrium to be going on with without inviting more.

Dr. Norman A. Godman (Greenock and Port Glasgow)

I have a continuing constituency interest in Caledonian MacBrayne in terms of both direct and indirect employment. I take it that the reference in the amendment to employees includes those currently employed by the company. That being the case, may I make a plea on behalf of my constituents who find their employment by way of Caledonian MacBrayne. Incidentally, in this context the Lord of the Isles, a Caledonian MacBrayne ferry, is to be launched from Fergusons in Port Glasgow on 7 March. I believe that the vessel will be launched into the Clyde by a lady by the name of Mrs. Edith Rifkind. I have certainly got the good lady's surname right, if not her first name, though I think that, too, is correct.

The object of this amendment is to ensure that the interests of travellers, local people and employees are given representation equal to that of commercial and management interests on the board of Caledonian MacBrayne Ltd. In my view, representatives of local people, present employees and travellers will be most anxious to ensure that orders for new vessels are placed with Scottish shipyards.

I make no apology for making a special plea here in the context of the purchasing power that this new board will have, especially for ferries. Scotland's merchant shipbuilding capability has been considerably reduced. We now have, on the merchant shipbuilding side, Fergusons, Hall Russell of Aberdeen, which, I believe, has finally been purchased in the past few days, the Norwegian firm on the upper Clyde, Kvaerner, and Caledonian MacBrayne.

The new board that is to be set up will need to order upwards of a dozen vessels over the next decade. That may be within one or two of the figure currently in the company's estimates. I think I am right in saying that the plum order will be the replacement vessel for the Suilven, which plies between Ullapool and Stornoway. The present vessel is very old as ships go. It is not up to the job, although it is crewed and officered magnificently. It has to be replaced within the next three years. I sincerely hope that the new board—made up, as it would be if this amendment were accepted, of, amongst others, representatives of local people, travellers and present-day employees—will ensure that that contract is awarded to a certain yard on the lower Clyde, Fergusons of Port Glasgow.

Local employment in Inverclyde would be helped immeasurably by such contracts. It would be tragic locally if the Scottish shipbuilding dimension were ignored in the scheme of things by this new company. The kind of board that my hon. Friends envisage would ensure that Scottish shipyards, in their present parlous condition, were not ignored.

To move the headquarters of this company from Gourock, if it were not a local disaster, would at least cause dismay amongst many of my constituents, who either work directly for the company or obtain their work by way of the company.

On 3 March the Secretary of State will formally initiate the Inverclyde enterprise zone. I think the ceremony is to be conducted in the municipal buildings in Greenock. I have been invited to the ceremony, and I take it that my hon. Friend the Member for Renfrew and Inverclyde, West (Mr. Graham) has also been invited.

Mr. Graham

No.

Dr. Godman

My hon. Friend says that he has not been invited. I find that utterly surprising, and not right or proper.

If, the Inverclyde enterprise zone having been set up, the headquarters is to be transferred to Oban, the people I represent will be deeply unhappy. In saying that, I mean no disrespect to the good people of Oban, but it seems sensible, in the light of the setting up of the Inverclyde initiative, that the headquarters of this company should remain in Gourock. I understand that in Oban there are few houses for rent or sale. I am told also that there is a major problem in acquiring suitable premises and that there are certain skill shortages in the area.

Mrs. Ray Michie

I should be most interested if the hon. Gentleman could tell the House from where he got his information.

Dr. Godman

I shall be perfectly happy to tell the hon. Lady, who, of course, has a deep interest in this matter. I think that she welcomes the transfer of this headquarters—and there we part company. I have been told by employees of the company—

Mrs. Michie

In Gourock?

Dr. Godman

Yes, of course. I have been told by employees of the company that that may well be the case in Oban and its surrounding areas.

Mr. Graham

I have received letters from constituents who work at the CalMac headquarters who have found that there is a problem with, for example, housing and education provision for the mentally handicapped. I am sure that my hon. Friend has similar information.

Dr. Godman

I do not see why the lives of the fine, decent and honourable employees at Gourock should be disrupted so dreadfully by the move, or why they should be dismissed and receive paltry redundancy pay. It is essential that CalMac retains its headquarters at Gourock. It is essential that the new board has the composition which the amendment envisages and that it accepts the need to protect the interests of travellers, employees and those who work in Hall Russell and Fergusons in Port Glasgow.

In view of the establishment of an Inverclyde enterprise zone, it makes sense for the new board of the new company to place orders for vessels with those two local shipyards. I do not want orders to be placed elsewhere in the United Kingdom, and certainly not overseas. Orders should go to Scottish shipyards. The Minister should give employees at Gourock an assurance that the headquarters will stay in Gourock and that their employment opportunities will not be threatened. The Minister is an honourable man: he should accept this honourable amendment.

8 pm

Mr. Graham

The Minister knows my feelings about the Government's proposals. I fully support the amendment. I am extremely worried by what the Secretary of State for Scotland said on Second Reading. Introducing the Bill, he said: I intend to appoint a new board for the company, which will contain persons with commercial expertise, including some with first—hand knowledge of the islands served and their needs. That is vital to ensure the responsiveness of the company to its customers. As a matter of priority, I would look to the new board to examine the possibilities of relocating the headquarters nearer the centre of the area which it serves. Oban seems likely to prove a suitable place for this purpose. I shall also ask the new board to explore the possibility of transferring to the private sector the Gourock-Dunoon and Wemyss bay-Rothesay routes."—[Official Report, 14 December 1988; Vol. 143, c. 980.] It is imperative that any board should be able to do its job and not have the Secretary of State's hammer at its head and be told that it must consider moving from Gourock to Oban.

What type of board are the Government setting up? Is it a board of donkeys which nods in the direction of what the Secretary of State requires? That would be disgraceful. A board should be able to look at the books and enhance the company's operations. It is incredible that the Government should tell it to privatise the Gourock-Dunoon route. That is nonsense. It is a profit-making run which could make more profit if the company was allowed to run as a free commercial enterprise like companies up the road. The Government put restrictions on CalMac's operations. Allowed to operate freely, the company would produce far more profit.

The same can be said of the Wemyss bay-Rothesay route. Restrictions imposed by the Government ensure that CalMac does not produce profit sufficient to reduce its subsidy. It is lamentable that the Secretary of State made an announcement about the board without describing the CalMac operation.

The review of accounts says: Caledonian MacBrayne continue to go from strength to strength. There has been a remarkable growth of traffic over the years reaching record levels in 1987 and more than justifying a sustained substantial programme of investment in ships, piers and passenger facilities generally. The Company's contribution to the prosperity and well-being of the island communities is further secured and strengthened by an aggressive marketing policy which is targeted successfully. Mr. Ian Irwin, CBE, chairman and chief executive of the Scottish Transport Group, has said: Caledonian MacBrayne is now bearing the fruits of the careful planning, investment and aggressive marketing of the last decade. The company has had its best year ever with record passenger carryings and a refund of subsidy to the Secretary of State for Scotland for the second year running (£1.3 million in 1987 and £0.7 million in 1986).

Dr. Godman

May I observe that I have some criticisms of the present board, one of which is that too often it has ordered ships furth of Scotland?

Mr. Graham

A board has to examine books and make value judgments. I can show clearly that CalMac has worked hard for the people of the islands and its customers.

The headquarters in Gourock has one of the finest staff. They can be held up as an example of workers who have dedicated themselves to the company for which they work. Their record is one of the finest. They are not working in a Para Handy outfit. They work for a shipping company with 28 ships. In the headquarters, the company has one of the largest computer operations in the west of Scotland. It is served by trained, knowledgeable and dedicated staff. There are engineering workshops and bakeries, for example, adjacent to the headquarters—they help to keep costs down.

The company owns the headquarters and the workshops. It is based on the Clyde. The managing director has said quite clearly—and the Minister knows it—that he thinks that a move to Oban would be commercially unsound. He has done an assessment of the work force, 90 per cent. of whom say that they do not want to move to Oban.

I have spoken to the workers and they are extremely unhappy. The board has to be caring. It should consider the views of the workers and the islanders.

I have shown, through the people who have been operating the company successfully, that the workers are an excellent band of people who will continue to strive to enable the company to grow from strength to strength. The board must face the possibility that, because of the Secretary of State's hammer hanging over the company, 90 people could be thrown on to the scrap heap. That might happen in an area with one of the highest unemployment records, not just in Scotland, but in Britain. Why should they be thrown on the scrap heap simply because the Secretary of State wishes to move the headquarters to Oban?

Moving to Oban is not commercially sound. It will not help to reduce costs; it will probably increase them. A burden will he imposed on Oban if the workers decide to move. Will the poor be given homes? Will the 18-year-old girl who has written to me be guaranteed a house? Will the woman who has written to me and who has a mentally handicapped son receive the same services as she receives in my constituency? I do not believe so. With the best will in the world, the services cannot be provided.

The Oban area has its own housing problems and homeless people. I am not an expert on Oban, but I know my constituency. I know the workers in Gourock who work for Caledonian MacBrayne. I have met them. They want to continue to work. They do not want to go on the dole. They want to continue to work for CalMac, as they have done for many years.

Dr. Godman

There is another element to the proposed transfer to Oban, and it relates to the objectives of the Inverclyde initiative and, presumably, the Inverclyde enterprise zone. Those objectives are concerned with reviving the largely dying waterfront of Greenock and Port Glasgow. In that context, would it not be absurd to dampen down Gourock by such a transfer?

Mr. Graham

My hon. Friend is right. The board must look at the Inverclyde enterprise zone. Businesses could be set up in the area to help reduce the subsidies. It would help ensure that CalMac continued to grow from strength to strength.

I hope that the Secretary of State will not continue to dangle the sword of Damocles over the head of the workers. This is a blatant act of piracy, not on the high seas but in high places. Decisions will be made by people who are remote from the workers. I hope that the board will reflect the views of the workers and that it will not consist of people in remote high places.

I hope that the Secretary of State will bear in mind the fact that those workers have worked to ensure that the 28 ships remain at sea and that there is adequate clerical and administrative back-up. More than 800 people are employed by CalMac and the 100 workers in question wish to continue to be employed there. I plead with the Minister to allow them the right to work in Gourock. They should not be thrown on the dole queues. He should give them that right. Through their work they have allowed CalMac to sail the seas and service the islands. He should allow them to continue to work and he should stand up and fight for the CalMac workers.

8.15 pm
Mrs. Ray Michie

The amendment is similar to one I tabled in Committee which was rejected by the Minister. I hope that he will accept this amendment, which I support. I have reiterated on many occasions how important it is that the new board reflects the wishes of local people and employees. The membershitp should consist of people mainly from the islands and the mainland ports from which CalMac sails. It is important to have a membership representing Dunoon and Rothesay. Those are the two routes that the Government have, unwisely, put under threat. It is essential that the views of the people in those areas be properly reflected.

I was interested to hear the hon. Member for Cunninghame, North (Mr. Wilson) say that the Labour party is in favour of Caledonian MacBrayne's headquarters remaining in Gourock. I am sorry that the hon. Member for Western Isles (Mr. Macdonald) is not present because he never said whether he would be in favour of the headquarters moving to the Western Isles, which is the wish of his council. Therefore, perhaps the Labour party is not in full agreement on that subject.

I can fully understand the wish of the hon. Member for Renfrew, West and Inverclyde (Mr. Graham) to defend his constituents and their jobs. I have already told the hon. Gentleman that the local Social and Liberal Democrats on the council are concerned about the people in the area. I have also said that, should there be a move, "hope that the Secretary of State will give every possible help to anybody who has to move. However, I do not believe that any Member of Parliament would turn down the opportunity of jobs coming to his or her constituency.

Several Hon. Members

rose—

Mrs. Michie

I will not give way. I want to develop this point a little further.

Mr. Graham

On a point of order, Mr. Deputy Speaker. I have already told the hon. Member for Argyll and Bute (Mrs. Michie) that I have no wish to take jobs from her constituents.

Mrs. Michie

Hon. Members should understand that no hon. Member lifted a finger to stop Argyll and Bute losing jobs. We have lost a considerable number of jobs in the Health Service and in the social work department, which has been removed from my constituency and centralised in places such as Dumbarton and Paisley. Nobody said how terrible that was. They said that it was great that the department should move to somewhere such as Paisley. I am interested to know also how often the hon. Member for Renfrew, West and Inverclyde—[Interruption.]

Mr. Deputy Speaker

Order.

Mrs. Michie

I am interested to know how often the hon. Gentleman has travelled on Caledonian MacBrayne ferries and where he goes when he travels on them.

Mr. Graham

Will the hon. Lady give way?

Mrs. Michie

Yes, I shall be interested to hear the answer.

Mr. Graham

I have travelled frequently on Caledonian MacBrayne ferries and on many of its routes. I have travelled from Gourock to Wemyss bay, from Gourock to Dunoon and from Wemyss Bay to Bute. I have travelled on nearly all the Shetland ferries.

Mrs. Michie

I am interested to hear that. There are ferries to Gourock, Wemyss Bay, and Rothesay. What about Coll, Tiree, Colonsay Stornoway and other ports?

I understand what the hon. Gentleman is saying, but he does Oban a gross disservice when he talks about the lack of facilities there and most especially when he talks about the lack of facilities for mentally handicapped children and adults in the area. It is quite wrong that he should say such things without any knowledge of the excellent facilities available in the Oban area.

Much has been made of the great computer that works so efficiently in Gourock. I am sure that it does work reasonably efficiently.

Mr. Graham

Will the hon. Lady give way?

Mrs. Michie

No, because I want to develop my argument about the computer in Gourock. Some hon. Members should speak to constituents outwith Gourock and ask them how many times the computer has double-booked them, how many times they have received their first-choice railings and how many times what is said on the computer in Gourock is the same as is said on a computer in another part of Caledonian MacBrayne. They are often saying completely different things, so we must find out just how wonderful this computer is.

I say to the Minister again that we must have not just an assurance, but words written into the Bill that will ensure that the people of the islands and the mainland ports are given majority representation so that they can reflect the needs of the islanders especially.

Lord James Douglas-Hamilton

I shall first answer the hon. Member for Greenock and Port Glasgow (Dr. Godman) who raised an important point about orders with Scottish shipyards. I am glad to confirm that the last two ships built for CalMac—the Isle of Mull and one to be launched next week—were both built in Scottish yards. CalMac places orders where it obtains the best value for money and, obviously, it is extremely happy to place orders in Scottish yards. That has been a policy in the past, and will, no doubt, continue to be its policy.

The hon. Member for Cunninghame, North (Mr. Wilson) asked about the profitability of the Gourock-Dunoon route. That route is not profitable as it is operated at present. My right hon. and learned Friend the Secretary of State spelt out the anomaly of an unsubsidised private sector crossing competing with a subsidised private sector crossing on similar routes and he chose his words carefully on Second Reading when he said that the board would look at the possibilities in this connection.

Dr. Godman

In relation to the Ullapool and Stornoway service, has the Minister any idea when an order is likely to be placed for a replacement vessel for the Suilven?

Mr. Deputy Speaker

Order. We are having a wide debate, but we must have some regard for the terms of the amendment.

Lord James Douglas-Hamilton

I shall write to the hon. Gentleman on that point.

On relief vessels, it was suggested that if the three ships that operate the Gourock-Dunoon and Wemyss bayRothesay services were transferred to the private sector, CalMac would not be able to provide relief vessels in cases of breakdown. I can assure the House that that is not the case. The three ships concerned cannot operate outside the Clyde, and relief arrangements for the Western Isles will be unaffected. The island service can, at present, draw on the Jupiter or the main CalMac relief vessel in case of breakdown. The capacity of the Jupiter, however, is significantly less than that of the Isle of Arran and of the main relief vessel the Glen Sannox, which will still be available.

I understand the passions that the siting of the headquarters has raised and I listened with care to the remarks of the hon. Members for Argyll and Bute (Mrs. Michie) and for Renfrew, West and Inverclyde (Mr. Graham). I respect the representations made on behalf of their constituents. The reason why my right hon. and learned Friend the Secretary of State will be asking that the new board should consider the best location for its headquarters is that he believes that it is right that the headquarters should be nearer the centre of the area that they serve. My right hon. and learned Friend said that he thought Oban would be likely to prove the most suitable place. Obviously, the new board will look at the issue carefully and will take into account the interest of employees. It is worth considering carefully whether moving the headquarters would improve the service to the islands.

Mr. Graham

The logic of the Minister's remarks does not meet the eye. Does he mean that everything will be moved into Glasgow because it is the centre of population in Scotland? I cannot understand his logic because in that case, all kinds of businesses should settle in Glasgow. Surely the Minister is not saying that that is how businesses should operate. The managing director has said that there is nothing the matter with the CalMac operation in Gourock, so to move to Oban makes commercial nonsense. Surely the Minister must listen to the man in the driving seat.

Lord James Douglas-Hamilton

If the headquarters move to Oban, they will be nearer to the centre of operations for the lifeline services to the islands concerned. The points that the hon. Gentleman makes on behalf of his constituents and the workshops and the other evidence that he puts forward will, of course, be taken into account. But it is important to bear in mind the commercial aspects of CalMac's operations and the fact that the jobs in question will be relocated, not lost to Scotland.

The hon. Member for Argyll and Bute asked me about members on the CalMac board from Rothesay and Dunoon. The Clyde shipping services advisory committee has two members from Rothesay and a member from Dunoon. That shows how the shipping services advisory committees are the best way in which interests can be involved. When my right hon. and learned Friend announced that a new board would be appointed for CalMac, he said that it would contain people with commercial expertise, including some with first-hand knowledge of the island and their needs. We discussed the composition of the board in greater detail in Committee and I gave an undertaking that we would look for persons with first-hand knowledge of the islands among those who are resident in the islands. We should not see the new board of CalMac as divided into those who have commercial or shipping experience and those who know about the islands. I hope that the persons appointed will combine as many qualifications as possible. We do not want the board to be divided into two camps. Our aim is to have a board that has both the necessary expertise and is responsive to the needs of the travellers who use the service.

Amendment No. 16 suggests that those on board should in some way be there to represent a single interest or qualification. Under the amendment, persons would have to be appointed in relation to a particular interest. That might make the task of appointment more difficult, especially with a small board. For those reasons I ask the House to reject the amendment. In doing so, I remind hon. Members of the other arrangments that exist to represent consumers' interests, such as the transport users consultative committee for Scotland which will continue to have a remit covering CalMac. The committee contains two island residents from Arran, and one from Lewis. The shipping services advisory committees will also continue. Each of the three advisory committees contains substantial representation from the islands and the travelling public.

With those three committees, it is possible to have much more extensive island representation than on a small board.

The advisory committees will continue to be consulted by the board of CalMac as before and I hope that that demonstrates to the House the machinery that will continue to exist for responding to the views of the travelling public and those residents in the islands. In the light of that and my description of how we shall approach board appointments, I hope that I have reassured the House that the new board will be responsive to local needs. I therefore ask the House to reject amendment No. 16.

Mr. Wilson

I am sure that I speak on behalf of all Opposition Members when I say that we are not reassured. Indeed, we shall be reassured only when we see the names of the people who have been appointed to the new board and when we have had a little time to study their biographies.

8.30 pm

I object to the distinction that the Minister just drew when he suggested that the natives can travel steerage on the consultative committees while a different breed of person will be appointed to the bridge and be members of the small board. That happens at present in other organisations, especially in the Highlands and Islands development board. It is almost unique for anyone who comes from or lives or works within its area, to be appointed to that board. The other organisation is the Highlands and Islands development consultative council, which is where the local representatives are herded and, supposedly, consulted.

The amendment calls for local people to be represented at first-class rather than third-class level. We are concerned about the board and we shall be keeping a close eye on its membership. Although we cannot take this further tonight, I warn the Minister that if he refuses to take heed of what is said and if he appoints people only because they can be relied on to represent the Tory interest, this will be another little problem that will dog him for the rest of this Parliament.

My hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) suggested bringing back Mrs. McCurley. As has already been said, Mr. Corrie has already been brought back in a closely related role. One of my colleagues in Committee suggested that Mr. J. J. MacKay of blessed memory, whom the hon. Member for Argyll and Bute (Mrs. Michie) replaced, might fancy a nice little earner as chairman of the CalMac board, which would keep his connections with Argyll and Bute. I am sure that the work of organising the small band of Scottish Tories cannot be so onerous that he would not have the time to do that on the side. All those names have been bandied around, and I have mentioned one or two possibilities. They will be queuing up already because in such circles they know when jobs for the boys are being handed out, and there will be a few applicants for this one.

Dr. Godman

We can hardly blame those Tory discards for their interest. Mrs. McCurley, for example, has been given a part-time appointment with the Horserace Betting Levy Board. The new board may well be made up largely of Tory discards.

Mr. Wilson

That is the risk that we are trying to spotlight. I am sure that Mrs. McCurley will be as much an expert on horse racing and levies as most of the possible contenders for this board are on ferries.

People in the areas served by the ferries can see through what is happening. I have no doubt that if the Government appoint political nominees, they will continue to pay the political price.

I shall deal briefly with the two central questions raised by the Minister—the Gourock-Dunoon service and the location of the headquarters. I can assure the Minister that I know that the Gourock-Dunoon route is not profitable. Indeed, I did not say that it was profitable, but that it is less unprofitable than most other routes and that is a significant difference, especially in a company that is based on subsidy. If one takes out the less loss-making routes, one must increase the subsidy to those that make greater losses otherwise they will suffer a diminution of service. That is the straightforward economic argument against privatising the Clyde routes.

The Minister is also wrong in his rebuttal of my point about the movement of vessels among the various routes. It is true that the three ships that serve the Gourock-Dunoon and Wemyss bay routes cannot operate outside the Clyde, but if called upon ships that operate outside the Clyde can operate on the Gourock-Dunoon and Wemyss bay routes, as can ships that operate on the other Clyde routes. If one takes those two routes away from the CalMac network, that degree of flexibility will be lost.

I have absolutely no difficulty with the position of the hon. Member for Argyll and Bute on the question of moving the headquarters. She was offered what appeared to be something on a plate for one part of her constituency. She is entitled to fight for that and to support it. However, I thought at the start that she was a little incautious to do so because other parts of her constituency will be less well served. As she recognised in Committee, the idea of moving the headquarters from Gourock to Oban is predicated on the assumption that the Gourock-Dunoon and Wemyss bay-Rothesay routes would be taken out of the CalMac network. As I do not intend that to happen, I do not think that the proposal about moving the headquarters gets past first base.

Although I cannot answer for my hon. Friend the Member for Western Isles (Mr. Macdonald), who is not in the Chamber tonight, I do not think that the idea of moving to Stornoway is particularly sound, if only because there might be some difficulty about Sunday bookings.

Those arguments lie ahead. The main thing now is to get the board right. Although we can take that no further tonight, we shall press our amendment to the vote because we believe that it is essential to put clearly on the record our belief that the board should be representative of the island interest, committed to the extension and development of Caledonian MacBrayne, and not a pathetic cipher, hand picked by the Tories to serve the Tory interest.

Question put, That the amendment be made:—

The House divided: Ayes 100, Noes 173.

Division No. 105] [8.36 pm
AYES
Adams, Allen (Paisley N) Beckett, Margaret
Alton, David Beith, A. J.
Barnes, Harry (Derbyshire NE) Bennett, A. F. (D'nt'n & R'dish)
Blunkett, David Kinnock, Rt Hon Neil
Bradley, Keith Lamond, James
Bray, Dr Jeremy Leadbitter, Ted
Brown, Ron (Edinburgh Leith) Lewis, Terry
Buchan, Norman Lofthouse, Geoffrey
Buckley, George J. Loyden, Eddie
Caborn, Richard McAllion, John
Campbell, Menzies (Fife NE) McAvoy, Thomas
Campbell, Ron (Blyth Valley) McCartney, Ian
Carlile, Alex (Mont'g) McFall, John
Clark, Dr David (S Shields) McKay, Allen (Barnsley West)
Clarke, Tom (Monklands W) McKelvey, William
Clay, Bob McTaggart, Bob
Clelland, David McWilliam, John
Cohen, Harry Madden, Max
Cook, Robin (Livingston) Mahon, Mrs Alice
Corbett, Robin Marek, Dr John
Cox, Tom Marshall, David (Shettleston)
Cryer, Bob Martlew, Eric
Cummings, John Maxton, John
Davis, Terry (B'ham Hodge H'l) Michie, Bill (Sheffield Heeley)
Dewar, Donald Michie, Mrs Ray (Arg'l & Bute)
Dixon, Don Moonie, Dr Lewis
Doran, Frank Morgan, Rhodri
Dunnachie, Jimmy Mullin, Chris
Dunwoody, Hon Mrs Gwyneth Murphy, Paul
Eastham, Ken Patchett, Terry
Ewing, Mrs Margaret (Moray) Pike, Peter L.
Fields, Terry (L'pool B G'n) Powell, Ray (Ogmore)
Fisher, Mark Quin, Ms Joyce
Flynn, Paul Reid, Dr John
Foster, Derek Short, Clare
Fyfe, Maria Skinner, Dennis
Galbraith, Sam Steinberg, Gerry
Galloway, George Strang, Gavin
Godman, Dr Norman A. Taylor, Mrs Ann (Dewsbury)
Golding, Mrs Llin Wall, Pat
Graham, Thomas Welsh, Andrew (Angus E)
Griffiths, Win (Bridgend) Welsh, Michael (Doncaster N)
Haynes, Frank Wigley, Dafydd
Hood, Jimmy Wilson, Brian
Hughes, John (Coventry NE) Winnick, David
Hughes, Robert (Aberdeen N) Wise, Mrs Audrey
Hughes, Roy (Newport E) Wray, Jimmy
Hughes, Sean (Knowsley S) Young, David (Bolton SE)
Ingram, Adam
Jones, Barry (Alyn & Deeside) Tellers for the Ayes:
Jones, Martyn (Clwyd S W) Mr. Nigel Griffiths and
Kennedy, Charles Mr. Frank Cook.
NOES
Alexander, Richard Carttiss, Michael
Alison, Rt Hon Michael Cash, William
Amess, David Channon, Rt Hon Paul
Amos, Alan Chope, Christopher
Arbuthnot, James Clarke, Rt Hon K. (Rushcliffe)
Arnold, Jacques (Gravesham) Coombs, Anthony (Wyre F'rest)
Arnold, Tom (Hazel Grove) Cope, Rt Hon John
Ashby, David Currie, Mrs Edwina
Atkins, Robert Davis, David (Boothferry)
Baker, Nicholas (Dorset N) Day, Stephen
Batiste, Spencer Dorrell, Stephen
Bellingham, Henry Douglas-Hamilton, Lord James
Bendall, Vivian Dover, Den
Bennett, Nicholas (Pembroke) Dunn, Bob
Bottomley, Peter Durant, Tony
Bowden, Gerald (Dulwich) Evennett, David
Brandon-Bravo, Martin Fairbairn, Sir Nicholas
Brazier, Julian Fallon, Michael
Bright, Graham Favell, Tony
Brown, Michael (Brigg & Cl't's) Fenner, Dame Peggy
Browne, John (Winchester) Fishburn, John Dudley
Bruce, Ian (Dorset South) Fookes, Dame Janet
Buck, Sir Antony Forsyth, Michael (Stirling)
Burns, Simon Forth, Eric
Butcher, John Franks, Cecil
Butler, Chris Freeman, Roger
Butterfill, John Gale, Roger
Carlisle, John, (Luton N) Gill, Christopher
Carlisle, Kenneth (Lincoln) Glyn, Dr Alan
Goodson-Wickes, Dr Charles Norris, Steve
Gorman, Mrs Teresa Onslow, Rt Hon Cranley
Gow, Ian Oppenheim, Phillip
Greenway, John (Ryedale) Page, Richard
Gregory, Conal Paice, James
Griffiths, Sir Eldon (Bury St E') Patnick, Irvine
Grist, Ian Peacock, Mrs Elizabeth
Hamilton, Hon Archie (Epsom) Porter, David (Waveney)
Hamilton, Neil (Talton) Powell, William (Corby)
Hanley, Jeremy Price, Sir David
Hargreaves, A (B'ham H'll Gr') Raffan, Keith
Hargreaves, Ken (Hyndburn) Rathbone, Tim
Harris, David Redwood, John
Hayes, Jerry Riddick, Graham
Hayhoe, Rt Hon Sir Barney Ridsdale, Sir Julian
Hayward, Robert Rifkind, Rt Hon Malcolm
Heathcoat-Amory, David Sackville, Hon Tom
Heddle, John Shaw, David (Dover)
Hicks, Robert (Cornwall SE) Shephard, Mrs G. (Norfolk SW)
Hill, James Shepherd, Colin (Hereford)
Hind, Kenneth Skeet, Sir Trevor
Hordern, Sir Peter Smith, Tim (Beaconsfield)
Howard, Michael Soames, Hon Nicholas
Howarth, Alan (Strat'd-on-A) Speller, Tony
Howarth, G. (Cannock & B'wd) Spicer, Sir Jim (Dorset W)
Howell, Ralph (North Norfolk) Stanbrook, Ivor
Hughes, Robert G. (Harrow W) Stern, Michael
Hunt, David (Wirral W) Stewart, Andy (Sherwood)
Hunt, John (Ravensbourne) Stradling Thomas, Sir John
Hunter, Andrew Summerson, Hugo
Irvine, Michael Taylor, Ian (Esher)
Jack, Michael Taylor, John M (Solihull)
Janman, Tim Taylor, Teddy (S'end E)
Johnson Smith. Sir Geoffrey Thompson, Patrick (Norwich N)
Jones, Gwilym (Cardiff N) Thurnham, Peter
Jones, Robert B (Herts W) Townend, John (Bridlington)
Kellett-Bowman, Dame Elaine Tracey, Richard
King, Roger (B'ham N'thfield) Tredinnick, David
Knight, Greg (Derby North) Trippier, David
Knowles, Michael Twinn, Dr Ian
Lawrence, Ivan Walden, George
Lightbown, David Walker, Bill (T'side North)
Lloyd, Sir Ian (Havant) Ward, John
Lord, Michael Wardle, Charles (Bexhill)
Meyer, Sir Anthony Wells, Bowen
Miller, Sir Hal Wheeler, John
Mitchell, Andrew (Gedling) Widdecombe, Ann
Mitchell, Sir David Wiggin, Jerry
Monro, Sir Hector Wilkinson, John
Moore, Rt Hon John Wilshire, David
Morris, M (N'hampton S) Winterton, Mrs Ann
Morrison, Sir Charles Winterton, Nicholas
Moss, Malcolm Wolfson, Mark
Moynihan, Hon Colin Wood, Timothy
Mudd, David Young, Sir George (Acton)
Nelson, Anthony
Neubert, Michael Tellers for the Noes:
Nicholls, Patrick Mr. David Maclean and
Nicholson, David (Taunton) Mr. Sydney Chapman.
Nicholson, Emma (Devon West)

Question accordingly negatived.

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