British Telecom (Hansard, 21 July 1993)

§ 11. Mr. Bates
To ask the President of the Board of Trade what representations he has received from those wishing to renationalise British Telecom.

§ Mr. McLoughlin
I know of no such representations to renationalise British Telecom, even from the Opposition Benches—[HON. MEMBERS: "Oh"] I am sorry. We still have some people who would like to see that. The Government 345 are convinced that the privatisation of British Telecom and the introduction of competition into the telecommunications market has been largely responsible for British Telecom's transformation into a highly successful and internationally competitive telecommunications operator.

§ Mr. Bates
Does my hon. Friend think that that almost complete silence is due to the fact that a three-minute cheap rate telephone call is now half the price in real terms that it was 10 years ago? Is not it due to the fact that there are now 96,000 telephone boxes, of which 95 per cent. are operational, as opposed to 50 per cent. 10 years ago? Does my hon. Friend think that those improving statistics, of which we are all aware, may have been of benefit to people sceptical of the benefits of privatising the rest of the Post Office at the earliest opportunity?

§ Mr. McLoughlin
I am grateful to my hon. Friend. I think that I have made the Government's position on the Post Office fairly clear in my answers to earlier questions, but he is right. There have been dramatic improvements in the performance of British Telecom, in spite of all the scare stories that we consistently hear from Opposition Members at times of privatisation. There were scare stories that telephone boxes would go. My hon. Friend is right to say that more boxes are in operation; what is more, they are working, which is quite a change from the position 10 years ago. There has been an improvement to the customer and to the country.

§ Mr. Barnes
What were the costs of the advertisements to encourage people to register for British Telecom shares? Will the Minister have a word with a Home Office Minister to find out how that compares with the money that was spent on encouraging people to put their names on the electoral register? For instance, last year nothing was spent on the latter in Northern Ireland, although a considerable sum was spent there on encouraging people to register for British Telecom shares. Does not that display the Government's incorrect balance of values? They push ahead with privatisation, when people try to grab what they can, rather than being involved in the democratic process.

§ Mr. McLoughlin
I was not sure from that question whether the hon. Gentleman was telling us that he favoured renationalisation. Since privatisation, the service provided by British Telecom has dramatically improved, and we even see occasional signs of approval from Opposition Members.

§ Mr. Ian Taylor
Does my hon. Friend agree that the risk from the Labour party is not simply of renationalisation but of other idiocies, such as a windfall tax on profits to cover up its overspending in other areas? Will he draw the attention of the millions of shareholders who subscribed to the successful share offer to the fact that they are likely to be savaged if there is another Labour Government?

§ Mr. McLoughlin
I agree with my hon. Friend that the supposed windfall tax that the Opposition were talking about would do great damage to British Telecom's future investment. Opposition Members speak with different tongues, however, because only yesterday the hon. Member for Livingston (Mr. Cook) issued a press release which ended by saying: These twin reforms, taken together, will benefit every industry, every citizen and every BT shareholder. 346 I have yet to understand how their proposed windfall tax would benefit shareholders.

§ Mr. Cousins
Surely the Minister recognises that after many millions of pounds were spent pushing the BT share sale, a few weeks ago a prospectus finally emerged in which BT mentioned six major issues of fair competition and fair regulation, including one on which it is taking the Government to court? In the light of that, does the Minister advise new shareholders to hang on to their shares?

§ Mr. McLoughlin
Here they go again, totally criticising our intention to create wider share ownership and trying to undermine what has been a very successful share offer. We are proud of the fact that we have returned British Telecom totally to the private sector and we are amazed at the turnaround by the Opposition Members. We are proud of our wider share ownership. We will not do anything to destroy it. The Labour party would.

§ Mr. Maginnis
Although one welcomes and supports competition in the telecommunications industry, is the Minister content with the fact that Mercury is creaming off the best business while British Telecom continues to meet the need to invest in and service the more remote rural areas, such as my constituency?

§ Mr. McLoughlin
The hon. Gentleman raises a particular point. Many representations are made to the director general of the Office of Telecommunications. The director general will obviously consider the representations that are made to him. That is a very effective way of doing so. We should welcome competition in the telecommunications industry; it is beneficial to the consumer. Obviously, the director general of Oftel will judge all those matters when he makes his decision.