TRANSFER SCHEMES MADE BY CAA

HC Deb 15 November 2000 vol 356 cc954-1004

Lords amendment: No. 27, in page 27, line 5, at end insert— ("() No direction to make a transfer scheme shall be given under subsection (1) before the first Session of the next Parliament after that in which this Act is passed.")

4.22 pm

The Minister for Housing and Planning (Mr. Nick Raynsford)

I beg to move, That this House disagrees with the Lords in the said amendment.

Mr. Speaker

With this it will be convenient to discuss Lords amendments Nos. 28 and 29 and the Government motions to disagree thereto.

Mr. Raynsford

The purpose of the three amendments is to ensure that no transfer schemes are made or approved before the first Session of the Parliament following that in which the Bill receives Royal Assent. Transfer schemes involve the transfer of assets, rights and liabilities to relevant parties in readiness for the NATS public-private partnership. That cannot be set up until those transfers have been effected. Therefore, the amendments have the effect of delaying the PPP until the next Parliament—until after the next general election.

I am sure that it will come as no surprise to hon. Members that the Government do not think that that delaying tactic is helpful. We do not see the need for any further delay in proceeding with the establishment of the PPP. We made our first announcement of the proposal for a partial sale of NATS on 11 June 1998. That was followed by a public consultation on the proposal in October that year and a statement was made following that consultation.

There are other instances of consultation. There has been a Select Committee inquiry. The sale documentation was made available to the House, and certain parts of it to other interested parties, and was subjected to lengthy debates in Committee. There has therefore been ample time for public scrutiny of both the policy and its detail.

In addition, it has been necessary to introduce legislation to enable the partial sale of NATS to take place. There have been lively debates on the Bill in the House, in Committee and in another place. That in itself has enabled the Government's proposals to be subjected to further detailed scrutiny.

I turn to the main purposes of the PPP. There is an urgent need for investment in NATS and for the injection of new project management skills. Important investment decisions need to be made now in respect of major projects. The ability of a strategic partner to make a meaningful contribution to those may be lost if the PPP is delayed.

Mr. Llew Smith (Blaenau Gwent)

Will the Minister confirm that the Government now intend to put the air up for sale?

Mr. Raynsford

If my hon. Friend waited a little while, he would hear a full explanation of the Government's policy, including our absolute commitment to maintaining full safety in all United Kingdom air traffic services. I hope that he will form a proper and considered judgment when he has heard all the arguments.

There have already been delays in introducing new technology at the Swanwick centre, and there is a pressing need for the contribution from the strategic partner both here and at the new Scottish centre at Prestwick. NATS has an excellent reputation and record on safety, but it would benefit from a strengthening of its capabilities in the introduction of new technology. A delay in the introduction of the PPP, which the amendments would cause, could jeopardise the prospects for both centres.

Moreover, further delay and uncertainty will not be helpful to NATS or its staff, who have had to live with uncertainty for far too long. The previous Administration started questioning the future of NATS some years ago. We have tried to put a stop to that uncertainty by making an early announcement on the PPP. To add further delay now would be unfair to NATS staff, and could jeopardise the urgent need to recruit more air traffic controllers.

Dr. Gavin Strang (Edinburgh, East and Musselburgh)

I ask this question because I would genuinely like to know the Government's latest view on the matter. My hon. Friend has rightly reminded us that the new en-route centre at Swanwick is well behind schedule. As he will know better than me, although development of the centre is NATS' responsibility, all the software, hardware and equipment—which we hope will be a quantum advance in air traffic control—are the responsibility of the private sector, including the main private contractor. How does he apportion blame for the delay between the private contractor and National Air Traffic Services? Is it still the Government's view that the centre will come on stream not this winter but next winter, and that, when it does, it will indeed be a quantum advance in air traffic control?

Mr. Raynsford

My right hon. Friend has studied this matter carefully because, if I may remind him, he was the Minister who, on 11 June 1998, made the statement to the House on the Government's decision to proceed with the public-private partnership. At that stage, he acknowledged the fact that there was a need for a partnership both to secure investment to develop services and to mobilise private sector resources.

My right hon. Friend said on 11 June 1998—and I entirely agree with the position that he took at that time— Our preference is that 49 per cent. of the shares, and a golden share, are held by the Government; and 51 per cent. by private investors including employees.—[Official Report, 11 June 1998; Vol. 313, c. 637W.] That is exactly the model with which the Government are currently proceeding. The logic that led my right hon. Friend to that conclusion remains the logic that has led the Government to the current proposals.

As for Swanwick, we are five years behind schedule and have over-expenditure of several hundred million pounds. That is not a cause for congratulation. It is essential that we have in place a proper management structure that can ensure that, in future, procurement of the necessary information and other technology to provide services to guarantee effective and safe air traffic control systems is handled better than it has been.

Several hon. Members

rose—

Mr. Tam Dalyell (Linlithgow)

Will the Minister give way?

Mr. Raynsford

If my hon. Friend will bear with me, I would like to finish my reply to the question asked by my right hon. Friend the Member for Edinburgh, East and Musselburgh (Dr. Strang).

Whatever the merits or failures of individual contractors, ultimately it is the responsibility of the commissioning body to ensure that it gets the brief right and introduces the appropriate technology and systems on time and on budget. We believe that we need to strengthen national air traffic controls with the new arrangement of a public-private partnership to ensure that new technology is commissioned on time and on budget, rather than to repeat the rather unhappy experience that we have had at Swanwick. It is equally important to ensure that the new Prestwick centre goes ahead. I know that my right hon. Friend the Member for Edinburgh, East and Musselburgh and others who represent Scottish constituencies are particularly keen to see that happen.

4.30 pm

Mr. Alasdair Morgan (Galloway and Upper Nithsdale)

Before the right hon. Member for Edinburgh, East and Musselburgh (Dr. Strang) intervened, the Minister was saying that the Lords amendment that we are discussing was unfair to NATS staff. Can he tell us, therefore, why the NATS staff whom I and other hon. Members have met support the amendment?

Mr. Raynsford

Some NATS staff probably do support the amendment, but I was making the point that prolonging the continuing uncertainty about the future of NATS, which would be the effect of the amendment, would not create a climate of confidence in the future. It would certainly not be in the interests of recruiting new staff. NATS and others have made the point forcefully that there is an urgent need to recruit new air traffic controllers. I believe that it is the Government's responsibility to ensure that the people doing that hugely important job can have the confidence to look ahead and know the framework in which they will be expected to operate.

Mr. Dalyell

It is not a question of some NATS staff; it is a question of the considered view over many briefings of the Institution of Professionals, Managers and Specialists and the British Air Line Pilots Association. In particular, why have Ministers been unable to persuade the IPMS on the issue of the willingness of the PPP to maintain public interest services, notably to general aviation users, which are uneconomic but essential for safety reasons?

Mr. Raynsford

I have to tell my hon. Friend, for whom I have a great deal of respect, that it is not the Government's responsibility to ensure the adherence of every particular body to the proposals. It is their responsibility to take a view on this. I cannot answer for the decision of the IPMS, but I can assert firmly that the Government have made it absolutely clear from the outset that the safety of air traffic control systems in this country is the top priority. We have said it again and again and, in order to show our bona fides, we have accepted amendments that we will be debating later this evening which give effect to that by putting it clearly and unambiguously in the Bill.

Safety will be paramount. It will be the No. 1 priority under the new proposal. I can assure all right hon. and hon. Members of that because there has been a certain amount of misinformation on the subject from people who have suggested that safety might be compromised.

Mr. John McDonnell (Hayes and Harlington)

Will my hon. Friend give way?

Mr. Raynsford

I shall give way in a moment, but first I should like to make this absolutely clear to the House, because there has been some uncertainty: Safety will be the No. 1 priority. The Government are absolutely committed to the maintenance of the safest possible air traffic control system. We are also committed to ensuring that it is a modern, up-to-date and efficient system which is able to cope with the many pressures that it will face in the years ahead as traffic increases.

Mr. McDonnell

My hon. Friend has stated that part of the motivation for the proposal is to provide security for the staff and to respond to their concerns. Has he visited the air traffic control centre in West Drayton in my constituency in the past two years? I may have missed his visit. Has he consulted the staff? If he has not, why not ballot the staff and ask them for their views on the issue? Their view is very clear. The unions involved have consulted their members and made it clear that they are opposed to the Government's proposals.

Mr. Raynsford

I have not visited the air traffic control centre at West Drayton, but my ministerial colleagues have. We have listened very carefully indeed to the views that have been expressed by all interested parties. However, my hon. Friend will be aware that a range of different parties all have a view on the matter. The Government clearly have to take a balanced view in the light of the evidence and, above all, in the national interest. It is our considered view that the necessary investment to secure an effective future service of air traffic control systems in this country is best served by a public-private partnership which can bring in the benefits of additional private sector investment and private sector project management expertise, while at the same time ensuring the most rigorous safety regime which, as I have already made it clear to the House, is the No. 1 priority.

Mr. David Winnick (Walsall, North)

Given that we are now seeing the results of the Tory privatisation of the railways, does it really make sense at this time to go for the semi-privatisation of a public service? That is what some people call the Government's proposed public-private partnership. I should have thought that the Lords' decision would have encouraged Ministers to reflect and seriously reconsider the proposal.

Mr. Raynsford

My hon. Friend airs understandable and justifiable concerns about safety on the railways, which many of us share. The Government are absolutely committed to ensuring that effective action is taken to deal with the problems, which have been much in evidence. However, the model that we propose for the NATS public-private partnership is very different from the privatisation model adopted for the railways.

These are very important issues. Specifically, under the model that we propose, the private sector will be invited to supply investment and project management skills. They will be hugely important in the procurement of efficient new IT systems to enable the service to operate as we want it to in the future. I have already explained why that is so vital.

However, my hon. Friend will be aware that the Bill ensures that the whole issue of safety remains in the public sector. The Civil Aviation Authority will retain the primary responsibility for safety and will set the safety standards. Safety will remain its No. 1 priority, as the Bill makes clear. That is the difference between the framework that we propose and that adopted for the privatisation of the railways.

I hope that my hon. Friend will accept that the framework proposed in the Bill is different, and that it has been designed to take account of the special needs involved in providing safe and efficient air traffic control systems. The framework will ensure that we can expand the system to meet changing pressures and needs, while at the same time guaranteeing the maintenance of the safest service possible. That has always been our No. 1 priority.

I understand that in another place a precedent was cited for delaying the implementation of transfer provisions. In 1982, during proceedings on the Telecommunications Bill, the then Secretary of State for Trade and Industry said that neither the transfer of assets and obligations to the new company nor the issue of shares to the public would take place before the general election that was coming up.

There is, however, a major difference between the British Telecom case and NATS. The former was a flotation in which the Government were selling off their interest in the business in its entirety.

Mr. Bernard Jenkin (North Essex)

The British Telecom arrangement would nowadays be called, in modern parlance, a public-private partnership. Only 51 per cent. of shares were sold, with the Government retaining 49 per cent. for a considerable time.

Mr. Raynsford

I am perfectly happy to stand corrected on that point, but it was the intention of the then Government to dispose of their entire holding, and British Telecom is now an entirely privatised utility. That is not the Government's intention with regard to NATS. As the hon. Gentleman will know from our lengthy and enjoyable debates in Committee, the Government intend to retain a significant shareholding in NATS at all times. That difference is very important.

In the case of the PPP, the Government are proposing to dispose of a proportion of our interest in NATS, but we will retain a substantial stake to ensure that the public interest remains protected.

Mr. Gordon Prentice (Pendle)

That very substantial interest may amount to only 25 per cent. Will my hon. Friend explain that? Moreover, is not the crucial difference between the privatisation of British Telecom and the Government's proposals with regard to NATS that these proposals were never mentioned in the 1987 Labour manifesto?

Mr. Raynsford

First, as my hon. Friend will have noted, the Bill sets the level of Government shareholding initially at 49 per cent. The Bill allows for that to be reduced if it is felt appropriate to do so, through dilution, to a figure no lower than 25 per cent. The purpose of that was made very clear in Committee and right hon. and hon. Members who were there will understand the reason. We have frequently made the point that air traffic control systems in Europe will change dramatically in the years ahead. We will inevitably see a consolidation. We will see a reduction from the large number of current air traffic control centres to probably only a handful.

We want to ensure that NATS is in a strong position so that it can play a leading role in the process of consolidation. There may well be, as part of that process, a case for some further disposal of shares to enlarge the number of interested parties. However, the Government have been clear that they will always retain a minimum of 25 per cent. of shares, which is the sufficient shareholding to ensure that they are capable of blocking any activities that could threaten the whole basis of the operation. That is the framework, and that is why the figures of 49 per cent. and 25 per cent. appear in the Bill.

My hon. Friend's second point was about the manifesto. He will be aware that the Prime Minister made a clear commitment in our manifesto. He said: We will search out at every turn new ways and new ideas to tackle the new issues … how to put the public and private sector together in partnership to give us the infrastructure and transport system we need. That is a pretty clear indication that we were ready to consider public-private partnerships in relation to transport services.

Mr. Jenkin

Will the Minister give way?

Mr. Raynsford

No, the hon. Gentleman had better listen to this, because he will not necessarily like it.

Let us compare that commitment with the Conservative proposals. The previous Government proposed the total privatisation of air traffic control services without having made any such proposal in their election manifesto. It is sheer cant for the Conservative party to claim that there is anything wrong with bringing forward a proposal without its having previously been in the election manifesto. That was how they behaved when they were in Government.

Mr. Jenkin

Will the Minister give way?

Mr. Raynsford

Of course I will—if the hon. Gentleman wants to come back on that point, he is welcome to.

Mr. Jenkin

The Labour party manifesto can be accused of being a little misleading, while ours was perfectly clear. The Labour manifesto says, under "Shipping and Aviation": The guiding objectives of our aviation strategy will be fair competition, safety and environmental standards. We want all British carriers to be able to compete fairly in the interests of consumers. I do not think that anyone reading that will have got the impression that the sale of National Air Traffic Services was on the agenda. The hon. Gentleman should at least admit that this was a little thin.

Mr. Raynsford

I have quoted directly from the Prime Minister's words in the Labour party manifesto. He made it perfectly clear that public-private partnerships to give us the infrastructure and transport system we need would be pursued at every turn. That, in my view, is a clear commitment to consider such options. We considered them but had not reached conclusions at the time of the manifesto. However, when we were in government we concluded that an appropriate public-private partnership was the right way forward. That was introduced by my right hon. Friend the Member for Edinburgh, East and Musselburgh in a statement to the House in June 1998, and we stick by that commitment.

Mr. Llew Smith

Will the Minister now quote directly from the Labour party conference, when our spokesperson gave a commitment that we would not be selling off the air?

Mr. Raynsford

I recall very well the Labour party conference endorsing our public-private partnership recently. That is a clear commitment by our party conference, and the Government are acting in line with it.

Sir Norman Fowler (Sutton Coldfield)

Just for information, what did the phrase "the air is not for sale" mean?

Mr. Raynsford

I am not sure what it means. It is one of those phrases that people use glibly and repeat. However, there is an absolute commitment on the part of the Government to ensure that there will be a safe system for air traffic control. The public sector will continue to oversee the safety issue through the Civil Aviation Authority, which will remain in public ownership; and the public-private sector partnership will be there for the purpose that I have outlined—to bring in the necessary finance and new management expertise.

This is a genuine partnership, by strong contrast with the Conservative party's view that total privatisation is the preferred option. We reject that option. We have a way forward that guarantees the improved service that is so vital for the future and unquestionably guarantees public scrutiny and control of the safety issue, which is equally vital for the future.

4.45 pm

Mr. Dalyell

If there is to be monitoring, the self-regulation group will require a huge increase in human resources to regulate all NATS activities. As I understand it, 17 inspectors are employed for air traffic control and 10 for engineering. NATS employs 1,800 controllers and 1,300 engineers. How is regulation to be effected in terms of human resources?

Mr. Raynsford

We have made it clear on many occasions, and I am happy to give a further commitment now, that the Government will ensure that resources are available to maintain the safe system that we are committed to achieving. We will not allow human resource levels to fall below those that we regard as appropriate to meet the objectives.

Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale)

I asked the Under-Secretary of State for the Environment, Transport and the Regions, the hon. Member for Sunderland, South (Mr. Mullin), what plans there were to alter the number of safety inspectors after privatisation. He replied: The Air Traffic Services Standards Department … employs 27 inspectors dealing directly with operational safety issues…The CAA currently has no intention to alter the number of inspectors as a result of the completion of the National Air Traffic Services Public Private Partnership.—[Official Report, 10 November 2000; Vol. 356, c. 419W.] How can that give the public confidence?

Mr. Raynsford

I think that the public would want the confidence of knowing that the Government are committed to ensuring that manpower resources will be sufficient to maintain appropriate standards. If the CAA were to come to Government seeking additional resources, its application would be examined extremely carefully and sympathetically. However, the hon. Gentleman is referring to something quite different—that is, the current basis for staffing expectations. That does not relate to concerns about the adequacy of the staff to do the job. I have given the answer, and I hold by it.

Perhaps not sufficient attention has been given to the suggestion made by the other place that it would be appropriate for it to pass amendments that would prevent the Government from implementing certain provisions in the Bill until the next Parliament. It is my view and that of the Government that it would be entirely inappropriate for such amendments to appear in the Bill. It is even more inappropriate for such amendments to be proposed by a body which has not been subject to the judgment of the electorate. It is for the elected Government to determine the speed at which they can implement their legislation. Were the proposals of the other place to remain in the Bill—I hope that all my right hon. and hon. Friends will consider this carefully—we would be straying into dangerous constitutional territory, and creating a precedent that could be used again and again to damage the Government's good intentions. I urge my right hon. and hon. Friends to remember that when they consider how they will be voting at the end of the debate.

There are some in another place who have argued that we do not have a mandate from the people to pursue our proposals for NATS. That is rich, coming from a Chamber which has never been tested by the electorate. We look to that Chamber to act as a revising body, not as a body that dictates when Government legislation can or cannot be implemented.

I move on to the public interest. Under the Bill's provisions, the public will be protected through a range of measures, including the licensing regime, the strategic partnership agreement, the special share and the powers of direction. As all the necessary public protections are in place, no additional benefits for the public interest will be gained by delay. However, there will be considerable detriment. The PPP was included as a commitment in the White Paper on integrated transport, which was published in 1998. The focus of the White Paper was on transport safety and improvement of current regulatory systems. Implementing the PPP will make a positive contribution to safety by effecting a complete separation between safety regulation and service provision. I see no sense in delaying the split, which has overwhelming support from all those who have looked seriously at the issue, including the Select Committee.

The Bill contains several provisions that are important in their own right, including those that subject NATS to economic regulation irrespective of when the PPP is completed. The amendments would delay the PPP and the introduction of an improved incentive-based system of economic regulation, which is intended to benefit users.

I hope that I have explained why the Government are unable to accept the amendments.

Ms Sandra Osborne (Ayr)

If the amendments were agreed to, would my hon. Friend see any prospect of the Government changing their mind and considering, for example, a trust? Would he expect Labour policy on NATS to change at the general election?

Mr. Raynsford

We have considered a range of options and models proposed by various parties. We have also considered options proposed in other countries, notably the NAVCAN system in Canada. We fully understand that there are advocates of those systems, but we have concluded that the public-private partnership set out in the Bill is the right way forward. We believe it essential to proceed with it. My hon. Friend has been a forceful advocate of the new provision and investment in her own constituency which will guarantee the two-centre strategy. We wholly endorse that, and the PPP will make possible the investment necessary to ensure that we take forward that commitment and have effective operations at Swanwick and Prestwick. That is our commitment, and I am sure that the House will, on reflection, recognise that it is the right way forward. I urge the House to reject the amendments.

Mr. Jenkin

Now that I have seen the difficulty with which the Minister defended this proposal. I understand why the Secretary of State for the Environment, Transport and the Regions did not want to be here. The House is entitled to express concern at the fact that we do not have at the Dispatch Box a Minister who has ever visited the London air traffic control centre or Swanwick or met air traffic controllers. Not to put too fine a point on it, the Minister, is playing the role of paid counsel rather than that of a policy-making Minister. That is unsatisfactory.

I speak with absolute authority over Conservative transport policy. [Interruption.] That may invite a wry smile from the Minister, but there is a clear contrast between his position and mine. I am a member of the shadow Cabinet, and the Secretary of State is the only Minister in his Department who is a fully fledged Cabinet Minister. He should have been here to discuss this matter.

I should pick up one minor point. I do not accept that the split will be unable to go ahead if the amendment is accepted. The operational split could certainly go ahead, although the split of ownership admittedly would not.

There is no need to rehearse in detail all the arguments against the proposed botched privatisation. Although Ministers pretend that it is something other than privatisation, it compels businesses to seek strategic partnerships that might result in a conflict of interest. Having heard a debate for the past month or so on the unnecessary complexity of a previous privatisation, I find it strange that the Government should inflict on us a privatisation with a structure that is so complex. That structure leaves open the question of who is responsible, as the management have a shareholding of only 5 per cent., the strategic partner has a shareholding of 46 per cent. and the Government hold the biggest shareholding of all. When push comes to shove and there is a fundamental disagreement between the Government and the strategic partner, how will that break down? It is not obvious, as there is no clear chain of command.

This privatisation is being delivered with assurances that cannot be kept. The hon. Member for Pendle (Mr. Prentice) pointed out that the assurance that the Government will constantly retain 46 per cent. of the shares is not in the Bill. Clause 48 offers the possibility of a reduction in the Government's shareholding to 25 per cent. and includes a Henry VIII clause, as that 25 per cent. can be altered by a simple order laid before the House, which can now be voted through by a paper ballot in the No Lobby on a Wednesday afternoon, separately from a proper debate on the issue. The Bill puts absolute power in the hands of the Government, subject to only one tiny parliamentary check, so that they can sell 100 per pent. of the business if they wish. As a result of that Henry VIII clause, nothing in the Bill is immutable.

There is also the question of the golden share, which is supposed to be of great comfort. When the Bill was in Committee, the Minister for Housing and Planning scoffed when I pointed out that BAA's golden share was subject to infraction proceedings. On 11 October, the European Commission issued a notice that stated: Commission decides to refer UK to Court concerning BAA. The Commission is taking a stage further infraction proceedings against the UK concerning the golden share held in BAA. I do not want to rehearse all the arguments again, but it is clear from legal advice to the Commission that is freely available to Ministers that the golden share will not stand the test of a judgment by the European Court of Justice, so that is another assurance that cannot be delivered.

We have heard a lot about investment, but the preparation for privatisation has been heralded by a move to impose on the business an RPI minus formula that requires cuts in prospective capital investment. The NATS management response to the economic regulation group's second consultation paper points out that the Civil Aviation Authority's proposal in that paper requires savings of between 16 per cent. and 29 per cent. in capital expenditure. The privatisation will be very strange, as it will be the first privatisation to have required cuts in capital expenditure to get going. Every other privatisation has been premised on the prospect of substantially increased capital expenditure. However, we have seen the matter in black and white, as set out by the hand of NATS management.

Finally, there has been discussion of the continued assurances that the Government are giving about the two-centre strategy for the United Kingdom. There must be uncertainty about that, as we have heard in the background that NATS management have a vision of a four or five centre strategy for the whole of Europe. One wonders why the Prestwick investment has been constantly delayed and never put on the table. The Government will not be in a position to deliver their current assurance, even though they are saying that it is in the plans. However, once the business is in the private sector, we must ask whether they will be able to deliver their assurance, even if they continue to hold 46 per cent. of the shares.

Ms Osborne

That is exactly why I asked the Government to amend the Bill to ensure that the new Scottish centre would go ahead, but I cannot cast any light on previous delays, which were caused by the Conservative Government calling into question the two-centre strategy and introducing a vastly expensive and unworkable private finance initiative.

5 pm

Mr. Jenkin

Well, at least we had a PFI. The Government scrapped the PFI and now we are on a wing and a prayer. The hon. Lady will have to believe the promise of an industry in the private sector. She must explain that to her electors.

Safety is a constant refrain in this debate. I wish to place it on record that I have 100 per cent. faith in the safety regime of NATS and the way in which it is supervised by the Civil Aviation Authority. I do not believe that we will face the difficulties caused by the change in working practices and relationships as occurred on the railways because the safety culture in aviation is much stronger than it ever was on the railways.

Concerns about safety bring up questions of public and staff confidence. Whatever the merits of privatisation, this privatisation is certainly the wrong scheme. I do not know whether we will include privatisation of air traffic services in our next manifesto. I say that genuinely and openly. The promotion of solutions that do not command public confidence is a serious matter, and one that should affect the Government at this stage. I give the Government an absolute assurance. Whatever our policy is for air traffic control, it will be in our manifesto. We will be explicit.

Mr. Raynsford

It was not in 1992.

Mr. Jenkin

Well, it was in 1997, when we planned to carry out the privatisation. To accuse us of not including in our manifesto something that we subsequently did not do is not a strong point, if I may say so. The fact is that we included privatisation of air traffic services in our 1997 manifesto, and it is necessary to include a policy of such importance in one's manifesto.

We may well include the trust proposal in our manifesto. It seems to be an option that will provide the disciplines of private sector management without the alarm that would be caused by creating a profit-making company.

Mr. Raynsford

rose—

Mr. Jenkin

If the Minister wants to make fun of me for an apparent U-turn, let him go ahead, but I believe that the issues are much too serious to make fun of.

Mr. Raynsford

I have no intention of making fun of the hon. Gentleman or of indulging in the cheap and personal jibes that he has made such a hallmark of his speeches this evening. The point that I was making was that the criticism from the Conservatives that our 1997 manifesto did not contain an explicit policy commitment in relation to NATS comes a bit rich from a party that proposed the privatisation of NATS during the 1992–97 Parliament without having made any commitment in its 1992 manifesto. What it put in its 1997 manifesto is a different matter. The electorate certainly took a pretty dim view of the Conservative party's 1997 election manifesto.

Mr. Jenkin

That is a pretty double-edged sword. First, the Minister accuses us of not doing something that was not in our 1992 manifesto and then takes credit for the fact that we were beaten in the last general election, when privatisation was in our manifesto. Now, he proposes the privatisation of NATS when it was not in his manifesto.

I will come now to some of the comments that have been made. Fundamentally, these amendments are about only one argument—democratic accountability. It is always an exquisite irony—one that the hon. Gentleman seems unable to stomach—when the other place delivers a rebuke to this elected House about our democratic duties. The amendments offer just such a rebuke.

At the 1996 Labour party conference, the present Chief Secretary to the Treasury, then Labour's Transport spokesman, proclaimed to ecstatic Labour cheers: Labour will do everything we can to block this sell-off. Our air is not for sale. There is not much cheering at present.

Later that month, the right hon. Gentleman issued a press release stating that the scheme will undermine confidence in Air Traffic Control…Labour is determined to safeguard quality public service. We shall raise this in the Commons and make it a General Election issue. Why did Labour not make it a general election issue? Because Labour had a covert plan to privatise air traffic control.

In February 1997, the hon. Member for Manchester, Withington (Mr. Bradley), now a member of the Government, but then a shadow Transport Minister, said: I would like to confirm that the Labour Party are completely opposed to the privatisation of the National Air Traffic Services and under a Labour Government they will remain in the public sector. Nothing could have been clearer than that. There was nothing to suggest privatisation in the election manifesto.

Mr. John Bercow (Buckingham)

My hon. Friend has alluded—entirely appropriately—to the views of the hon. Member for Manchester, Withington (Mr. Bradley). Does my hon. Friend believe that the hon. Gentleman changed his mind on the subject before or after he was appointed Deputy Chief Whip?

Mr. Jenkin

Those are murky matters; they are best left to individual hon. Gentlemen and their shaving mirrors.

During the general election campaign, a little skirmish took place on this matter. A Labour spokesman said: What Andrew Smith said last October was criticism of the particular scheme offered by the government. John Prescott, Margaret Beckett and Andrew Smith have made clear that we don't rule out looking at the privatisation of air traffic control. Will the Minister tell me where Labour made it clear that they were looking at the privatisation of air traffic control? I suppose he—

Mr. Raynsford

The hon. Gentleman invites me to respond, but seems reluctant to hear the answer.

I have already quoted the Prime Minister's comments in our manifesto. On 4 April 1997, my right hon. Friend the Chancellor made it clear that the Government would consider a scheme for the privatisation of NATS; his remarks were reported in The Times.

Mr. Jenkins

One quote in one newspaper hardly constitutes a mandate. What is significant is the comment made by the Prime Minister when he was fighting the previous general election as Leader of the Opposition. In typically opaque fashion, the right hon. Gentleman said: We would have to review this sale because we inherited it from the Conservatives. I do not follow the syntax of that sentence, but it confirms just how double-dealing and two-faced new Labour can be; it certainly does not constitute a mandate for the privatisation that we are considering today.

We are now offered the choice of deferral of the proposed sale. The Conservatives set a precedent for such a deferral: the idea for the privatisation of British Telecom germinated during the 1979–83 Parliament, but the Conservative Government knew that they lacked a mandate for such a privatisation. The Minister has already quoted from a debate that took place at that time. So it was a case of "not in our manifesto, no sale."

As Lord Brabazon of Tara pointed out in the other place, that view appears to be reflected by the Deputy Prime Minister in connection with the sale of Railtrack. Last month he told the House of Commons: In fact, our argument was that the then Government waited to sell British Telecom until after the election, so they could have done the same with Railtrack.—[Official Report, 24 October 2000; Vol. 355, c. 151.] What is sauce for the goose should be sauce for the gander, and if the previous Government could have done it with Railtrack, the present Government could certainly do it with National Air Traffic Services.

This sale is every bit as controversial as that of Railtrack—possibly more so, as the election of the present Government was preceded by such explicit denials that such a sale could possibly take place.

This proposal should appear in a manifesto that wins the approval of electors before it goes ahead. The other place is right to make us think again about this matter, and it has every right to do so. After all, it was the Labour leader in the other place, Baroness Jay, who said that, following the Government's reforms of the upper House, it will be able to speak with more authority…A decision by the House not to support a proposal from the Government will carry more weight because it will have to include supporters from a range of political and independent opinions. So the Executive will be better held to account. She clearly did not envisage that Ministers would stand up at the Dispatch Box in this place and continue to demand fealty from the House of Lords as though it was some kind of patsy to be put back in its box at the first opportunity.

I wholeheartedly agree with Baroness Jay's comments, and I urge the House to reject the Government's motion.

Dr. Strang

I, too, oppose the Government's motion.

There are some very good practical reasons, some of which the hon. Member for North Essex (Mr. Jenkin) mentioned, for delaying the transfer. As was pointed out, National Air Traffic Services is facing two major challenges at present. The first is to get Swanwick—the new en-route centre near Southampton—into action as soon as possible, and senior management time should be devoted to that challenge. The second is to press ahead with the new Scottish centre.

The private finance initiative was initially proposed by the Conservatives, and for some time we continued to try to make it work. I agree with my hon. Friend the Member for Ayr (Ms Osborne) that it would have been a mistake. It is a mistake, in air traffic control, for the whole centre, let alone the software and hardware, to be owned by one company while the controllers are employed by someone else, as would apply under PFI.

Therefore, top management in NATS should be preoccupied with getting on with bringing Swanwick on stream and getting ahead with the new Scottish centre, and they should not be diverted, at this of all times, by this complex privatisation. It is indeed complex and, as we all know, has been described by the House of Commons Select Committee on the Environment, Transport and Regional Affairs as the worst of all options.

In addition, if the measure is driven by financial considerations—as we know it is—it does not make sense to sell off Swanwick when the whole place could have been operational in about a year's time. I emphasise that I am against privatising at any time but I ask the House to consider the following. Suppose that we are in the business of maximising capital receipts to get the best deal from the privatisation for the country and the Government. After all the trauma and all the problems, and whoever is to blame, whether NATS or the private sector—I am inclined to believe that both must accept some responsibility—if the Swanwick centre is going to be operational in the next year or so, surely it is sensible to wait until then before seeking a capital receipt for it.

On that financial issue, I am grateful to my hon. Friend the Minister for Housing and Planning for recalling what the Government were saying on the subject just before I left the Administration in July 1998. I have no intention of breaching any of the confidential discussions that took place between Ministers before I left the Administration and, as I have said time and again, I accept complete responsibility for any answers that I gave or anything that I said on the issue, but let me place the matter in context. My hon. Friend will recall that the announcement was made by the Chancellor of the Exchequer in his comprehensive spending review; that was the significant thing. Of course, as the then Minister of Transport, it fell to me to set out, as I did in a written answer, that the Government would consult. I emphasised—I remember the words vividly—that we were going to consult not just on the practicality, but on the principle behind the proposal.

5.15 pm

My right hon. Friend the Member for Hamilton, North and Bellshill (Dr. Reid) took over from me as the Minister of Transport, but the post was no longer a Cabinet position. He duly published a consultation document that made it clear that the Government were examining alternatives. It was a genuine consultation and he made it clear that other options would be considered. However, the announcement was finally made by my right hon. Friend the Member for Airdrie and Shotts (Mrs. Liddell), who had taken over as Minister of Transport, and, as we were rightly reminded, it was made on the last sitting day in July 1999. Governments tend to make a clutch of important announcements on the last day before the recess, but—my right hon. Friend will correct me if I am wrong—I think that she had to be summoned to the House to respond to a private notice question from the Opposition.

The history of the proposal is in the public domain, but the important point is that we all know that it has been driven by financial considerations. Indeed, my hon. Friend the Minister for Housing and Planning quoted what my right hon. Friend the Chancellor of the Exchequer said during the general election campaign. That shows that the proposal is all about finance. It is about the so-called "black hole" in the finances that the Labour Government inherited from the Conservative party's programme. It is important to understand that, for the Government, this proposal has been driven by financial considerations. There was the prospect of significant capital receipts and the Government wanted borrowing to be transferred from the public to the private sector.

NATS is profitable, and the Government still had the option of the Post Office solution if they wanted to choose it. Many people find it hard to understand how they accepted that option for the Post Office, but not for NATS.

We know that the proposal has been made for financial and not for safety reasons, and there is no point running away from the safety issue. To put it briefly, privatising NATS is not like privatising an airline. Make no mistake about it: the Government fully intend that the so-called private strategic partner will have complete strategic control of the service. With a privatised airline, such as British Airways, the private owners can maximise profits for their shareholders by improving the service. They can increase the frequency of the service, make it more reliable and improve comfort and in-house catering. That option does not exist for air traffic control. All that air traffic controllers do is keep planes apart and our skies safe. The only way a new private owner can obtain a higher return on the capital deployed and make even more profit from the service for private shareholders than it is making in the public sector is to cut costs.

That is why there is a concern that—not immediately, but in the long run—the conflict between private profit, which means driving down costs, and safety standards could put safety in jeopardy. If anyone is any doubt about that, I remind the House of what has emerged. In preparing for privatisation, the Civil Aviation Authority has proposed major cuts in NATS' prices. That information was leaked over the summer, and NATS said that that would impose major operational difficulties on the business. NATS is not a standard utility—safety in the ATC industry is undoubtedly of a different order of importance. One simple distinction is that manning levels are absolutely critical to ATC safety and service delivery, whereas that is not nearly so true in other utilities. That is what the management of NATS—probably the safest air traffic control system in the world—is saying about the threat of privatisation and the specific, complex partial privatisation scheme proposed by the Government. It will not wash to say that safety is not an issue, because it is, and that is why the scheme is opposed by airline pilots, air traffic controllers and the British people. On safety, let us not forget that, as far as the airlines are concerned, the crucial dialogue is between the airline pilot and the air traffic controller on the ground.

As for regulations in the public sector, the standards achieved by NATS are substantially higher than those laid down by the CAA as regulator. Everyone in the industry believes that if privatisation takes place, NATS standards will initially continue to be higher than those laid down by the regulator, who will remain in the public sector, but that, over time, they will inevitably come down to the level set by the independent regulator. That regulator will be responsible not just for NATS but for private airports and other groups that are in the business of air traffic management and control, although NATS is, of course, dominant. All the onward traffic—every plane in our air space—has to go through NATS. We should not get the exaggerated idea that because private airports are able to manage their inflow of planes, that is comparable to the national job that our nationalised, and therefore publicly owned, air traffic control does for this country.

Safety is an issue, but so is national security, and I believe that that is why no other country—certainly no major European country—has taken this approach. I have been told that the only country with a privatised air traffic control service is Fiji. The United States has not privatised its service because national security is involved. It is not just civil planes that have to be managed, but military planes—Royal Air Force planes and other military planes—that are based in this country. Our system is a model for Europe, if not the world. We manage to get RAF controllers and NATS civilian controllers to co-operate by working from the same premises. I, like most people, believe that that co-operation is best facilitated by having NATS and RAF controllers in the public sector.

There are other national security issues. What if there is a crisis? I do not want to be overdramatic, but we have to accept that we are planning for the long term. We are not merely concerned with what is going to happen in the first two or three years of privatisation. If we had information that a plane was coming into the country that had been hijacked or was carrying—dare I say it—a bomb or a substance that could be a threat to the civilian population, our Government, security services, police and military would have to take complete control and act as one with the air traffic control system. That is undoubtedly best facilitated by retaining NATS in the public sector.

We cannot rule out the possibility—we dealt with this in the Standing Committee—that the privatised company will eventually come under foreign ownership. The Minister confirmed that the Bill provides for the public stake in NATS to fall to 25 per cent., which means that more than 60 per cent.—two thirds—of the service will be owned by the private sector. The foreign-owned company could be based in a country where, in the event of a crisis in the middle east, the population and the Government might support, to put it crudely, a different side to that supported by the British Government. In such a situation, there could be a conflict of interest between the directions given by the Secretary of State, who has powers in the Bill to direct the new privatised air traffic control system, and the management—the foreign ownership—of the company.

We cannot run away from those issues. We are not legislating on a minor or inconsequential matter. We are not passing legislation that will have an effect just for the next two or three years. If the proposal goes through, the worry is that, in the long term, our people will pay a heavy price.

Mr. Jenkin

I did not refer to the threat of hostile foreign ownership in my speech, but the right hon. Gentleman is making an extremely important point on national security. Does he agree that the weak golden share provisions are not sufficient to withstand that threat? We would certainly not countenance any transfer to the private sector unless the golden-share provisions could be made absolutely watertight, which means insulating them from any threat from European Community law.

Dr. Strang

I am grateful to the hon. Gentleman; that is an important point. The Government would argue that we could rely on the golden share.

Mr. Raynsford

indicated dissent.

Dr. Strang

My hon. Friend indicates that that is not true; I withdraw my comment. I thought that there was some protection. Presumably, he is saying that there is no protection. The golden share relates to the articles of the new privatised company.

Mr. Raynsford

I was shaking my head because I was disagreeing with the interpretation of the hon. Member for North Essex (Mr. Jenkin), who implied that only the golden share provided the security. As my right hon. Friend will know, having studied the Bill carefully and been a member of the Standing Committee, specific clauses—clauses 86 and 87, I think—give the Secretary of State very clear powers to intervene in a national emergency to safeguard national interests. That is the proper safeguard.

Dr. Strang

I am grateful to my hon. Friend, but that is a tangential point. Who is to say that there would be such intervention if the private company, which may be owned initially by some British-based company—I think that a United States-based company is also in the frame now that the Government have got the list of potential private owners down to three—were sold to, for example, a Hong Kong-based company? Frankly, the Government of the day would not regard that as an emergency. The sale would go through and the worry would be over any subsequent national emergency.

Mr. David Chidgey (Eastleigh)

Does the right hon. Gentleman agree that there is a further, perhaps even more worrying, dimension? It is possible that part of NATS could be acquired not just by a foreign company but a company in the public ownership of a foreign country. Who is to say—I look forward to the response—that we can guarantee that another country's foreign policy will be at one with our own?

Dr. Strang

The hon. Gentleman makes an interesting point. He will understand if I do not go too far down that road, although he enables me to make this point: there is all this talk about privatisation helping us to facilitate European co-operation, almost implying that the new privatised air traffic control system will take over some of the European systems, but does anyone believe that the French will privatise their air traffic control system or that a private British air traffic control company will be allowed to buy the nationalised air traffic control system in France? No one believes that France is at all likely—certainly not in my life time—to privatise its air traffic control system. The danger is the reverse.

Mr. Jenkin

The Minister's reaction to the right hon. Gentleman's comments cannot stand uncorrected. The provisions that the Minister says give the Secretary of State powers to intervene in a national emergency are not insulated from any European Community injunction either. The Government insist that the provisions are so insulated, but they will carry on losing their cases in the European Court of Justice on those matters, just as they have in the past.

Dr. Strang

I am grateful to the hon. Gentleman. He will recall some fun in Committee at the expense of his Euro-scepticism, but he is right that the golden share is threatened by the European Union. I have correspondence with the appropriate Treasury Minister confirming that. One only has to read Lord Lawson's book on the golden share of the British National Oil Corporation to understand that such provision is a very tenuous line of defence. That is what history shows—and it is even more the case for NATS privatisation given the statements that are emanating from the European Commission, which has plans for Europeanisation of air space. That strengthens the case for ensuring that the service provider is under the Government's complete control. The only way to do that is to retain it in public ownership.

I shall conclude, because many hon. Members want to speak in the debate. Let me be up-front: I support the amendment because I believe that delay means that privatisation will disappear. I stress to my hon. Friend the Member for Ayr, whose constituency includes Prestwick, that I distinguish between the Government's policy and the Labour party's manifesto for the next general election. I do not believe that the Labour party will fight the next election campaign on a policy of privatising our air traffic control system. The amendment would prevent the Government from selling off any equity in our air traffic control system before the general election. That would have the effect of preventing a future Labour Government from selling our air traffic control.

5.30 pm

Mr. Moore

I am glad to follow the right hon. Member for Edinburgh, East and Musselburgh (Dr. Strang), who has again passionately presented the important arguments against privatisation from his perspective. From Second Reading last December and throughout the Bill's passage through the Commons, Liberal Democrat Members have opposed the privatisation of National Air Traffic Services. Our colleagues in another place continued that vigorous opposition. Like the right hon. Gentleman, our preferred option is the abandonment of privatisation and the creation of a trust or an independent publicly owned company. However, we acknowledge that delay is currently the only option, and we believe that a virtue can be made of that.

We share the right hon. Gentleman's view that delay greatly enhances the chances of the whole process falling through. Regardless of that, there should be a delay not least because privatisation did not appear in the Labour party's manifesto at the last election. I did not nick the Enigma code-breaking machine, but one would need to have possessed it to interpret the Prime Minister's introduction to the manifesto as meaning that air traffic control would be privatised. Thousands of others took a similar view. To put it bluntly, we were told that our air was not for sale. More fool us for believing that.

NOP conducted a recent poll on behalf of a leading trade union, the Institution of Professionals, Managers and Specialists. It showed that 76 per cent. of the public remain opposed to a sale of air traffic control, and only 14 per cent. support the proposals. That says everything we need to know about wider concerns outside the Chamber.

As we have debated the privatisation at length in the Chamber, in Committee and in another place, we have gleaned more and more details of what will happen under privatisation. Those details have come out grudgingly or through leaks, rather than through Government openness. We have mounting anxieties about the way in which NATS will be regulated after privatisation. There are serious questions about the suitability of some of the strategic partners who have come forward for consideration.

At the outset, the Minister raised an issue that was a feature of broadcasts outside the House earlier today. He made it almost a point of principle that sending back the Bill would be an insult to another place. He said that the popular will should prevail. The popular will, as reflected in opinion polls, does not support the measure. Their Lordships rightly pointed out that there was no manifesto commitment to privatisation. However, the most important point is that this Government have done more than any other in the past 50 years to reshape the other place in a manner that suits their purposes. There is, therefore, a sweet irony in the fact that the other place is kicking stuff back for us to reconsider.

At the heart of this debate is the investment requirement of NATS, which must be satisfied if the paramount objective of ensuring safety in our skies is to be maintained. Liberal Democrats have consistently accepted that investment is required, but we continue to deny that privatisation is the only way to achieve that. Our central concern, and that of many people throughout the country, is that privatisation could have a dangerous impact on safety.

Mr. Dalyell

My life, the hon. Gentleman's, and those of many of our constituents are constantly in the hands of the captains of British Midland and British Airways who fly us between Edinburgh and London. What is his view of their reaction?

Mr. Moore

The hon. Gentleman refers to the trips that he and I frequently make between Scotland and the House. I have sat beside him on many occasions, and he has carried out an informal poll of the pilots of British Midland and British Airways, which he kindly shared with the rest of the cabin. I agree with him in this instance—I have done so on many occasions previously—that there is strong opposition among pilots to the proposals. The Government should listen carefully to that message. I support the hon. Gentleman's comments.

I was drawing attention to the fact that financial considerations are at the heart of this debate. The most recent accounts for NATS show that the service increased turnover to £566 million in the past year and produced an operating profit of £63 million and a net cash inflow to the business of some £9 million. The point is that NATS has consistently paid for itself.

We believe that the investment requirements could also be paid for—a case could be made directly to the Treasury about the need simply to provide such investment. However, we do not believe that that is the only route. One could, through a trust or an independent publicly owned company, secure the financial regime that would allow the organisation to borrow against the strength of future cashflows. The Deputy Prime Minister and others have argued for months that they have advanced the only option, but it is increasingly clear that that is not the case. The Government's option does not bear much analysis.

Air traffic control after privatisation will remain heavily regulated. To all intents and purposes, it is a monopoly, and rightly so. As the right hon. Member for Edinburgh, East and Musselburgh said, demand and growth in that sector are severely constrained and outwith the control of NATS. The commercial concern that takes over the organisation must find its return and improve profits by focusing on costs. The public throughout the country are concerned about the matter to the extent that cost cutting will focus on areas that are essential to safety—as yet, they remain to be convinced.

Politicians on both sides of the House and elsewhere have argued about that matter for months, but we do not need to worry about who is right or wrong because we can turn to NATS itself, as hon. Members who spoke earlier have already done. Earlier this year, the economic regulatory group at the Civil Aviation Authority sent out a second consultation paper on setting en-route services charges in United Kingdom airspace for the first five years after privatisation. As has already been said, it contained significant average price reductions and real cost-per-flight reductions in the charges that would be allowed. It also opposed making massive capital expenditure reductions to obtain efficiency gains.

The response of NATS to that paper was, to say the least, rather blunt. Its response document in May contains a paragraph that gets to the point. It states: The cuts in cost and investment currently being proposed by ERG have little foundation in the reality of NATS' business and licence obligations, and so pose very serious risks to the delivery of services to NATS' customers. NATS could neither accept nor implement these proposals.

As recently as 16 October, in a presentation to the air traffic control work force, NATS management repeated those criticisms. They said that ERG was proposing a tougher average annual real price reduction than was set for any other utility at privatisation—this is especially inappropriate for a safety activity where service depends on adequate investment. Cost efficiency—ERG places too much emphasis on cost reduction and neglects the risks to service delivery. Incentives to invest: ERG's proposals send confusing signals to investors and do not provide the necessary incentives for capital investment. NATS could not have been any clearer about its position. It concluded that the severe cuts in operating costs and investment were inconsistent with the proper carrying out of NATS functions.

Apart from the concern of NATS about how it will be regulated after privatisation, there is our serious concern about the nature of the strategic partners who want to be part of the privatisation process. One of the key players in the Novares consortium is Lockheed Martin, a huge American multinational. It is the prime supplier at Swanwick, it has the contract for the new Scottish centre, and it is greatly involved in telecommunications and other systems. It is not in the habit of running air traffic control services. Its only motivation in this instance can be to ensure that it controls the paymaster of a service which, through overruns and delays, has already cost it some £150 million at Swanwick. That surely represents a major conflict of interest—a fact which the Government have yet to see fit to countenance.

The Airline Group—one of the other significant players—has been set up as a not for profit consortium. Most of the important United Kingdom airlines, including British Airways and British Midland, are part of that consortium. They do not themselves believe that the profit motive is appropriate in the case of this privatisation. The other side of the coin, is the fact that there is naturally a conflict of interest, because they are far the most significant customers and it would be handy for them to control the whole operation to the potential disadvantage of competitors.

How can such conflicts of interest be overcome? A document sent out by the Government inviting tenders stated clearly that those with a real or perceived conflict of interest would be eliminated from the process, but the Minister and his colleagues have yet to explain how the Government have dealt with concerns about very real public sector conflicts of interest.

There has been silence in response to criticisms, even those from NATS. Just as worrying, however, is the silence from the other part of the CAA with a direct interest in the process—the safety regulation group. I can trace no public statement of the group's observations about the proposed structure, or about the serious points made by NATS and others. Does the group agree with the current approach, or does it disagree? We do not know. Checking the Department of the Environment, Transport and the Regions website earlier today, I did not find even the NATS response to the economic regulatory group. I certainly did not find anything from the safety regulation group. The information concerned, however, goes to the heart of the debate, and until it is in the public domain the public are right to be suspicious.

When the Minister kindly gave way to me earlier, I had an exchange with him about the number of safety inspectors who will be employed after privatisation. He defended himself by saying that the Government would devote more resources to safety if more were asked for. That is a hugely complacent attitude. If the Government really believe in the safety case, which they have put passionately on many occasions, they should ensure that they—or at least the CAA—take steps to increase resources and, in particular, increase the number of inspectors who will be required to check what is going on after privatisation.

Ms Osborne

I agree with the hon. Gentleman's comments. Does he agree that the number of safety inspectors should be increased whatever structure is adopted for NATS?

5.45 pm

Mr. Moore

I welcome the hon. Lady's intervention, especially as it gives me the opportunity to remind the House that we support another provision that will ensure the separation as between the CAA and NATS of the overriding responsibility for safety. That is welcome, regardless of whether or not NATS is in the public sector. Whatever the structure—whether it is that proposed by the Liberal Democrats or by other Members—additional inspectors are clearly needed, even if only to give the public the confidence that such matters are being treated seriously. Frankly, the Government's complacency undermines whatever fine words they may occasionally use to show that they believe in safety.

Mr. Dalyell

Is there not a related problem in that most NATS standards are above the minimum standards maintained by the safety regulatory group? Therefore, the SRG will have to extend its monitoring role to a huge range of activity that it does not have to inspect at present. Where will the resources come from?

Mr. Moore

It beggars belief that the Government have not asked those questions. The process is summed up by the suggestion that the Government are waiting for the CAA to ask them for more resources, rather than proactively investigating whether more resources should be provided or whether more inspectors should be recruited. More details are emerging about how the privatisation will take place and how the regime will operate afterwards, but the Government are failing not only to provide good answers but to provide any answers at all.

The public are greatly concerned about transport safety generally. The public, the pilots, the air traffic controllers and many Labour Members, as well as Opposition Members, do not support the measure. There are growing concerns about the ability of NATS to cope with the regulatory regime after privatisation and serious problems about the suitability of possible strategic partners. Privatisation raises more questions, not less. We want the process to be stopped, and we shall at least support its delay.

Mr. Mark Todd (South Derbyshire)

I have listened carefully to the contributions so far, and some valuable points have been made about the relationship between the CAA and any contractor that provides air traffic control services in this country. However, I want to turn first to the principle involved and then—to the misfortune of those hon. Members who heard my previous speech—return to how we should define the relationship with the private sector in delivering out safety services.

Air safety involves a complex web, comprising the design, manufacture and maintenance of aircraft, flight crew competence, and the operation of airlines and airports, as well as the management of traffic in the air. We allow aircraft to be designed, built, flown and maintained by private businesses. We allow them to be flown on behalf of private operators. We allow them to fly into privately run airports. I do not understand the qualitative argument of those who want to disbar the private sector from any role in the ownership or management of air traffic control. Of course, we do not even make that judgment consistently now—we allow private contractors to develop key systems for NATS.

It could be argued that NATS has not performed the task of managing those projects particularly well. We allow NATS to win contracts competitively, in a private sector environment, for a large proportion of its work. We also allow other contractors to operate air traffic control services in other parts of the United Kingdom, including at East Midlands airport. Although that airport is just outside my constituency, the aircraft fly over my home and many air personnel of various kinds live in my constituency.

In the previous debate in the House, it was suggested that a private sector owner—we must bear it in mind that only 46 per cent. of NATS would be sold in trade terms, the other 5 per cent. being sold to employees of the company—would seek to press operating savings on the service, impacting on safety, and that that would have an inevitable consequence for the safety record of the service. I worked in the private sector for 20 years before coming here. I recall an intervention that I took in the previous debate, implying that the private sector simply drove down costs and maximised shareholder value, and that that was the only interest it had in any business that it ran. No sound private sector business deliberately jeopardises its core activity through cost-cutting.

Mr. Gordon Prentice

I wonder what my hon. Friend would make of the statement by Gerald Corbett from Railtrack: We cannot actually keep our shareholders happy at the same time as fulfilling our public service obligations, and that tension is just massive. He also said—I invite my hon. Friend to comment on it: In the early days after privatisation I think we probably did concentrate too much on shareholders and the profit agenda.

Mr. Todd

That is a fair point, which I anticipated might be raised. There is clearly a tension. We would be unrealistic if we did not recognise that, but that is why we have a regulatory framework. One of the points that we must recognise about Railtrack—I think that there is reasonable consensus on it in the House—is that the regulatory framework for safety in the rail sector was poorly designed. Anyway, it was built for an industry where the safety impetus was of a lower strength than it is in the air sector. Therefore, the comparison, although well made—I take my hon. Friend's point—does not directly apply in this instance.

Mr. Dalyell

I am listening to my hon. Friend's thoughtful speech, as I listened to his speech last time, but what bothers some of us is the ability of the private owner that he talks about to finance investment that may be uneconomic but very important for safety reasons.

Mr. Todd

If that company's core business is the provision of safe services, it will have to factor into the basis on which it funds the company the acquisition of such systems—but let me counter the argument by an alternative line. The public sector is not immune from the discipline of cost-cutting. The equation that appears to be made sometimes is that the private sector is driven by the desire to drive down costs and the public sector has money spilling over to carry out new service development and uneconomic investments.

Those of us who have represented people—I have in the House and did so as a councillor before that; I have done it throughout my adult life, pretty much—are well aware that the public sector has the same, if not more, disciplines and has to find savings, often at the jeopardy of convenience, and, sometimes—dare one say it—at the jeopardy of the safety of the citizen. There is the issue of how the national health service is funded and the difficult choices—I buy into that—that must be made in a public sector organisation about who to help and who to save. We must face that sort of equation within the public sector, too. Drawing that line between the public and private sectors, saying, "Good on one side, bad on the other; it is cost-cutting on one side and affluence on the other" is simplistic. We need to set it aside.

Mr. Moore

May I return to the extract that I referred to from NATS submission to the CAA, based on the regulatory regime that is supposed to apply after privatisation? In that document, it says: NATS' prime duty is the safe provision of air traffic control. Severe cuts in operating costs and investment are inconsistent with the proper carrying-out of NATS' functions. Surely, in those circumstances, it is not a question of public or private. The public sector is criticising its own Government's regime.

Mr. Todd

I think I am right in saying that that dictum has been set out regardless of the ownership framework of NATS. I stand to be corrected. I will willingly give way if the hon. Gentleman says that it is specifically premised on the basis that the ownership will change, but, as I understand it, that is a dictum regardless of the passage of the Bill. I may be wrong. I see some Ministers nodding, so I am probably correct. I have not heard anyone dissent.

I shall spell out the issue a little further. Direct public sector ownership does not equate to maximum safety provision. Nor, sadly—again, we must recognise it as public representatives—does it always equate to maximum accountability. There was a time—I have been in my party for a long time—when we probably had simpler views on the strengths of the public sector and the weaknesses of the private sector. Over years of exposure, I have found it to be more complex than that.

Mr. Martin Salter (Reading, West)

Patronising.

Mr. Todd

I will give way to my hon. Friend if he wishes to intervene. I think he wishes to speak later.

Mr. Salter

My hon. Friend will get to hear it all soon enough.

Mr. Todd

I am sure I will.

I return to the core point because I do not want to detain the House for long; many Members wish to speak. The case that I touch on in a little more detail is East Midlands airport. As I have said, it is owned by the private sector. The air traffic control system there is operated by the private sector. It is the largest freight airport in the United Kingdom. It was said in the previous debate that it was a small operation, but those who live near it would deny that.

The fact is that that airport has, out of its own funds, recently invested in a completely new control tower and systems which are the envy of most airports in this country. That was done by private finance. It was not forced on to the airport by a public sector body, nor was it carried out by a public sector contractor.

I see no logical basis for excluding the private sector from NATS ownership. We take no such stance in any other part of the air safety network. We do not even take a consistent position on that within the air traffic control system itself, as I have said.

I recognise the strength of some of the arguments that my colleagues have made; I heard the word, "Patronising". I am not wedded to the view that the proposal is the only possible solution to our air traffic control needs. There is consensus that massive new investment is required in the service and that there is a range of possible solutions, but I have sought to point out that the somewhat dogmatic position that has been adopted—that private sector means dangerous, unaccountable or higher-risk—is simplistic. Therefore, on balance, on the basis of the intellectual argument that I have heard, I will continue to support the Government—but I say "on balance". I understand the points that have been made by my colleagues.

Mr. Chidgey

I oppose the Government motion, but, before I make my contribution, may I refer to the speech by the right hon. Member for Edinburgh, East and Musselburgh (Dr. Strang), who spoke with great clarity? I recall earlier in the Parliament when he and I spoke on transport matters from opposite Benches. Listening to his speech, we got an insight into what the real policy was behind the proposal.

6 pm

I have a constituency concern in the issue. As some hon. Members may realise, my Eastleigh constituency borders the new Swanwick centre. Many of my constituents work at the Swanwick centre and, on various occasions in past months and years, have contacted me to express their concerns about the plan for NATS. Not the least of their concerns is that they will not be able to do their jobs as well as they do now. They have genuine concerns about the safety of the general travelling public, whom they feel it is their fundamental task to protect.

The Minister knows what has happened at Swanwick. Although those facts are pretty much public knowledge, it is worth reminding ourselves of them. The new centre is forecast to be six years late, and it has already cost hundreds of millions of pounds more than it should. As we know, Lockheed Martin, which is a multinational concern, is both the prime supplier at Swanwick and a leading bidder in the Government's part-privatisation proposals for NATS. Those facts should suggest to the House and, I hope, to the Government that there is some variability of competence in the private sector.

As the hon. Member for South Derbyshire (Mr. Todd) said, there is more than one solution. The hon. Gentleman very eloquently and rightly pointed out that no particular part of our economy is perfect. However, neither the public sector nor the private sector is perfect. I say that with more than a quarter of a century's experience of working in the private sector on projects rather similar to Swanwick, although they may not have had the same outcome.

Ministers seem to have an almost childlike faith in the ability of profit-motivated private companies to cure the ills that we see in NATS. They seem to be claiming that only a public-private partnership can meet the necessary investment targets and deliver the modernisation programme that is necessary to cope with the growth in air travel.

Today, I was a little alarmed to hear the Minister say that the controversy in the debate—in which the House is rightly engaged—on when and how the proposals should be implemented are in themselves causing a decline in recruitment of trainee air traffic controllers. Although it may not have occurred to the Minister, perhaps the prime reason for declining recruitment is that potential recruits do not want to join an organisation that is no longer in the public sector or known to have as its fundamental aim the safety of the public whom it serves. Potential recruits may be concerned that a profit-driven company would not maintain the standards that they would wish to achieve. Either of those may be a key factor in people's decision whether to join NATS. Recruits who believe that the safety of the airways and of millions of passengers is paramount are perhaps particularly turned off by those considerations.

We should deal with NATS' response to the economic regulatory group's consultation. Does the Minister know of any organisation that has been able to achieve the type of targets set by ERG in its consultation paper? ERG proposes that there should be significant initial and subsequent price cuts leading to reductions of between 21 and 35 per cent. by year 5; assumed operating cost efficiency of the same order; and assumed savings of between 16 and 29 per cent. in capital expenditure. ERG is proposing that, in an organisation that is crying out for capital expenditure, there should be a saving of between 16 and 29 per cent.

ERG is also proposing not only that a 7.5 per cent. efficiency gain should be assumed in NATS' plan, but that NATS should make a profit. Where does safety come in in such a regime? I do not know of any organisation that has been able to achieve such targets and make a profit, let alone maintain safety levels. Let us face it—air travel is pretty risky. Aircraft do not stay up on their own. They are not like a No. 9 bus when its engine fails on the Clapham road and it just stops. Aircraft have a nasty habit of falling out of the sky, particularly if they are too close together and hit each other.

Ministers say that they have constructed a Bill that they believe makes safety the paramount issue in NATS' future, and I do not doubt their sincerity at all. I am quite sure that the Minister is absolutely convinced that he has done everything he can to ensure that safety is paramount. However, experience tells us that saying something does not make it happen.

I am sure that, when the railways were privatised, Ministers in the previous Government and Railtrack were equally sincere in their belief that they had created a structure that maintains as a paramount feature the safety of the travelling public. However, we do not have to be reminded of what happened at Paddington and at Hatfield to realise that one can get it wrong, and that saying it does not make it happen.

The official Opposition spokesman, the hon. Member for North Essex (Mr. Jenkin)—who has left the Chamber—said that the railways have a different safety culture, but I have to correct him. Anyone who has been involved in the engineering side of the railways will know that, whatever faults British Rail had, it was determined to run a railway. In BR's culture, although passengers may have been a bit of a nuisance and had to be put up with, safety was absolutely paramount. Any BR regional engineer who allowed his section of track—his permanent way—to get into the state that caused the Hatfield accident would have been sacked on the spot. Safety is built into public transport systems.

Dr. Norman A. Godman (Greenock and Inverclyde)

I have complete trust in the Deputy Prime Minister's commitment to enhance maritime, rail, road and air safety. However, many of my constituents have a deep distrust of privatisation, private finance initiatives and other public-private partnerships. I fear that the Government have failed to win over constituents who have that distrust, which I share.

Mr. Chidgey

Such public perceptions should greatly concern us. Members of Parliament are, after all, the guardians of the public good and the public need. Clearly, the Government have failed to win that argument on the public's safety concerns.

The question is not whether privatisation is the solution, but whether we need a solution. The issue is not to decide whether public ownership is the only way forward, but to determine what is wrong with the current system and how to improve it without a wholesale sell-off. As the right hon. Member for Edinburgh, East and Musselburgh said, the issue is being driven by financial considerations, not by considerations of how best to develop and improve our National Air Traffic Service. That is the key issue.

The PPP has been debated at great length and with great clarity in the other place. Although I shall not rehearse those arguments, the point that has come through in parliamentary debates on the issue is that we do not have to sell off a substantial chunk of NATS to get the things that Ministers rightly say are needed—such as project management skills and an investment stream, which are what the Minister said he is most concerned about.

Anyone who has been involved in the type of projects undertaken by NATS knows that it is possible to procure high-quality management teams who have experience not only in the United Kingdom but around the world. One can buy in those services. One can even buy in greater expertise than that which would be available to the particular bidder who won the contract to run NATS. One can also find the income stream necessary to finance improvements to NATS.

There is absolutely no reason why NATS—it is a rock-solid organisation with a substantial guaranteed income stream; last year, its profits were almost 15 per cent., which is not bad in most organisations—could not raise the money that it needs to reinvest and to develop. However, it needs the Treasury's permission to do that. That is the nub of the issue. If NATS could raise money in its own right, there would not be a problem. NATS could develop equally well as a not for profit organisation.

We do not have to sell off half of NATS to raise the necessary money. We can ensure that it remains in public ownership, which is what the public clearly want. Most important, we can ensure that NATS remains publicly accountable.

Given that in the House and across the country there is great controversy and concern about the Government's plans, and given the horrific example of rail privatisation and what happened when safety was disregarded because of the pursuit of other interests, including profit, surely the Government should take a step back. They should invite the National Audit Office to review the PPP plans. We in the House do not have an answer to every problem; we would be incredibly stupid and arrogant if we assumed that, just because we have the power to make decisions, our decisions are necessarily right. This is the time to step back and allow people with no vested interest to look deeply into what the Government are trying to achieve, no doubt with the best interests of the public at heart.

Unless the Government can make sure that their plans provide for the public a solution that is sound, safe and robust, and unless they can show that their proposals are in the interests of the taxpayer and, most important, those of the travelling public, I fear that they are going down a slippery slope. They should let the NAO look at the proposal carefully and come back with an answer in which the House can have confidence. Otherwise, I fear that in a year or so the Minister could well be back at the Dispatch Box, just as the Deputy Prime Minister was recently, having to apologise to the House and the public for a failed privatisation that compromised public safety, with all that that entails.

Mr. Salter

I have now spent the best part of two years examining the future of our country's highly acclaimed and widely admired air traffic control service. In that time, I have visited the biggest control centre in the world at Heathrow airport, only a few miles from where I was born and where I once worked. I have spoken to pilots, controllers, managers, union representatives, air safety experts, Government Ministers and airline executives— in fact, I have spoken to almost anyone and everyone connected with the industry. Above all, I have spoken to my constituents and the constituents of other hon. Members who live directly under a flight path. Our skies are already overcrowded and the lives of those people may depend on the decisions that we take tonight. I have also spoken with my hon. Friends, to whom, through you, Mr. Deputy Speaker, this short contribution is primarily addressed.

Let us look back to just over a year ago. I was in the middle of organising groups of Labour Members who were desperately unhappy with what the Government were and still are proposing to do to air traffic control. The Paddington rail disaster had occurred. The wreckage was still being cleared from the tracks, and my constituents who survived that awful crash were trying to come to terms with the wreckage of their lives. I have lost count of the number of my hon. Friends who spoke to me at the time; the conversations were always the same. They said, "Surely the Government won't go ahead with the privatisation of air traffic control now. Surely they are bound to drop it. There must be a better way." As we all know, they will, they are not and there is, so long as Labour Members who remain unconvinced do something about it and vote with our consciences and not, as we usually do, with our Whips.

I can well understand the argument that is being put about by the Government's business managers that Labour Members should think carefully about supporting amendments proposed by the Conservatives in another place. It has a certain resonance; it appeals to the tribal core. But I would suggest that there is a more powerful argument that my hon. Friends should weigh in the balance: what on earth is any Labour Member doing supporting a Tory proposal that we vehemently opposed at the last election?

While the House of Lords, for as long as it remains unelected, has no political mandate, nor do this Government have a mandate to push through a privatisation that we opposed so publicly and that was the subject of that famous speech at the last Labour party conference before May 1997. Let us remember how we all applauded the Chief Secretary to the Treasury, my right hon. Friend the Member for Oxford, East (Mr. Smith), and those carefully crafted arguments about commercial pressures compromising safety. We still hear those arguments from Government Ministers, but not today.

6.15 pm

Let me take a moment to praise not only the contribution of my right hon. Friend the Chief Secretary, but the highly efficient operation that has been mounted by the Government Whips Office. I have absolutely no doubt that the Government will win the vote tonight, but, as we all know, winning the vote and winning the argument are not necessarily the same thing.

The case has not been made for this partprivatisation—not remotely. The Government have three clear objectives: first, to deliver an investment stream that is essential for the modernisation of the operation; secondly, to take National Air Traffic Services out of the public sector borrowing requirement; and thirdly, to invigorate the project management by bringing in private sector expertise so that the service would be in a position to compete for a possible single European sky. All those objectives are entirely laudable and supportable, and entirely achievable without resorting to privatisation. That is the tragedy of the situation—we do not have to be here.

A solution is at hand. It is tried and tested and it is the preferred option of the Select Committee. It has the support of everyone in the industry. It is, of course, a not for profit trust based on the Canadian model. Established in 1995, NAV Canada delivers the Government's objectives in spades.

Financially, under current arrangements there is a 7 to 8 per cent. growth rate in air traffic. It is a highly profitable industry. Those running air traffic control in this or any western European country would have to try extremely hard not to make a profit or a surplus. In fact, NATS currently returns to the Treasury a surplus of between £30 million and £40 million annually. In 1998–99—these are the most recent figures I have available—NATS returned a pre-tax profit of £64 million. We need to modernise and we need private sector involvement, but let us not forget that the private sector involvement in Swanwick, which led to the delays and the fiasco, was carried out by none other than the US defence corporation Lockheed Martin, which is on the Government shortlist as a preferred strategic partner.

Let me tell hon. Members that when Lockheed Martin was in the frame for the running of AWE Aldermaston, which is just upwind and upstream from my constituency, I received an e-mail from someone in the United States with the simple words, "God help you." Lockheed Martin was the corporation responsible for Three Mile Island, a famous nuclear disaster. Its defence establishments have been suspended and are under investigation by the federal Government in the United States for breaches of safety procedures. I would suggest that it is not so much a case of biting the hand that feeds you, as of feeding the hand that bites you.

Of course we want air traffic control to be taken out of the public sector borrowing requirement. That is an entirely laudable objective, and, as I have said before, entirely achievable. Why should air traffic control compete for hard-earned public cash with police officers, firefighters, the national health service and schools? No one wants that and there is no need for it. The Post Office investment plans are already outwith the Treasury rule. The borrowing requirements for some of our regional airports have already been exempted from the PSBR. The trust model delivers freedom from the Treasury's financial straitjacket. That point is not in dispute. In fact, NAV Canada was so successful that in its first year it raised from the market in the private sector $3 billion, twice the amount needed, according to Government calculations, to fund the UK's investment requirements for the next 10 years.

NAV Canada has a board of directors who concentrate exclusively on the safety regime of national air traffic control. People with private sector expertise are involved, but they are balanced by representatives from the Government, the airlines and the unions, and some members of the board are independent. NAV Canada delivers gain without pain. Its structure works. I must therefore ask, as the Transport Sub-Committee has asked, why the Government are so against adopting it.

I am aware that other hon. Members want to participate in the debate, but I want to commend to the House the report from my colleague Lord Brett. He took the time and trouble to examine the Government's very derisory response to the trust option proposed by the Transport Sub-Committee. The report comprehensively demolishes the objections to the trust model. I hope that Ministers will return to it.

As I said earlier, winning the vote does not necessarily mean winning the argument. Good politics is about taking people with us, but there is massive opposition in the Labour party to the proposals. The NATS PPP is not something that will appear on a pledge card, and no one who supports the Government in the Lobby tonight will be proud of proposals that no one will mention in an election manifesto or personal address. A vote will be taken, and many people will want to forget that they ever participated in it.

The opposition in the Labour party is replicated out in the country. The latest poll shows that 76 per cent. of the population is against the proposals—hardly surprising after what happened at Paddington and Hatfield. Only 14 per cent. of people are in favour of the proposals to privatise air traffic control, which makes them more unpopular than fox hunting. We know what passion that issue arouses among Labour Members and out in the country.

There is deep hostility to the proposals among pilots, who do not belong to a Marxist trade union and who are not a group of workers renowned for their militancy. There is implacable opposition from air traffic controllers—the men and women who have given us the safest, most efficient and best service in the world.

We in this House make bad laws and bad decisions when we do not listen. We must remember the 75p pension rise and the poll tax. It is not too late, but the consequences of not listening when it comes to the future of air safety in this country are extremely serious.

Mr. Dalyell

Will my hon. Friend give way?

Mr. Salter

My hon. Friend will forgive me if I do not; I have sought no interventions and have taken none. However, my hon. Friend is allowed one heckle, if he so desires.

I make no apologies for drawing parallels with the reduction in safety standards directly caused by the privatisation of the railways. I am genuinely worried that history is about to repeat itself. It is still not too late, and there is still time for the Government to listen.

Ms Osborne

As the House will be aware, I am deeply worried about the future of the new Scottish air traffic control centre, and I want to concentrate mainly on issues related to that. However, I want to repeat concerns raised by several hon. Members earlier, most notably by the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore), about the cuts in capital proposed by the economic regulatory group. Those proposals are very worrying, and I should be interested to hear the Minister's response to them.

I cannot agree with the comments made by hon. Friend the Member for South Derbyshire (Mr. Todd), who talked about a dogmatic response among those—myself included—who have set out other alternatives. Perhaps I could buy his argument if people were suggesting that the status quo was the only option, but several alternatives have been laid out. Most notable among them are those set out by Lord Brett, whom I congratulate on his work. As far as I know, therefore, it is not true that any Labour Member is guilty of responding dogmatically.

The Tory proposal on deferral would delay the sale and the PPP for NATS until after the general election, and would have implications for the new Scottish centre. The Tories say that they made their proposal because the PPP was not part of the Labour manifesto at the last election. Like my hon. Friend the Minister for Housing and Planning, I find that a bit rich.

The Tory proposal also shows the Opposition's contempt for the future well-being and security of air traffic control, for the urgency with which investment is needed, and for the 700 jobs in my constituency that would be jeopardised if the amendments were accepted. Previous Tory Governments can take the credit for getting NATS into the position it is in today. There has been a chronic lack of investment, and constant delays have cost an astronomical amount of money and caused ever-mounting pressure on the system.

The Tories now want to delay the PPP even longer, although they claim to have no safety concerns arising from privatisation per se. Their only possible motivation, therefore, is to make a pathetic attempt to reap political capital, whatever the cost to jobs and investment.

The Tory party's obvious aim is to delay the PPP, and it would bring in full-scale privatisation if it had half a chance. I note that the hon. Member for North Essex (Mr. Jenkin) said earlier that the Tories would now consider adopting a trust framework for NATS. At this late stage, such a change of face is astonishing. They have always opposed and voted against that option in the past, but now they bring in the possibility purely for bandwagon reasons.

Mr. Jenkin

In fact, we supported a proposal for a trust tabled by a Labour Member on Report.

Ms Osborne

I accept that, but Conservative Members did not support the amendment relating to the trust option that was tabled in the Lords and which could have been considered in this House this evening. Tory Members have a strong record of supporting full-scale privatisation, not trusts.

I do not believe that the amendments would allow an alternative solution such as trust. In that, I differ from some of my hon. Friends. We have argued for three and a half years about the various options. I have played my part in those discussions, but it is clear this evening that the PPP is the only show in town. I fail to see what can be achieved by further delay. Accepting the amendment would only cause further delay, and it would play into the hands of the Tory party.

Mr. Don Foster (Bath)

I understand that the hon. Lady, inevitably, has to be worried about the impact of the proposals on her constituents, but will she reflect on what has been said about safety by many hon. Members of all parties? Does she truly believe that the PPP will provide a safe way forward for air traffic services?

Ms Osborne

There has been much discussion about safety and about proposals alternative to the PPP, and I have taken part in that discussion. The amendment does not deal with those issues, but proposes delay. I do not see how delaying the matter further will aid safety.

My greatest fear is that further delay will jeopardise the new Scottish centre and 700 jobs in my constituency. I cannot stand back and watch that happen. The new Scottish centre has been subjected to years of procrastination, delay and speculation already. It was for that reason that I campaigned for the Government to accept an amendment ensuring that current investment plans would be honoured.

In the past week, the competition to design the new Scottish centre building was won by Gibb Developments. The winning design was the work of Ron Moncrieff, who hails from Prestwick and whose first job was at Atlantic house there. My local newspaper, the Ayr Advertiser, carried a picture of the winning design, but people in my constituency have seen many pictures before. I want work to begin on the ground now, and I challenge any hon. Member to guarantee that the new Scottish centre will go ahead if the PPP is delayed any longer.

Mr. McDonnell

My hon. Friend will recall, from times when she has raised this matter before, that my hon. Friend the Minister responded by saying that funding for the Scottish centre would come by the traditional route. Does she not agree that it cannot therefore be dependent on a PPP?

Ms Osborne

That is not entirely true: £60 million of public money has been put forward, but that amount is predicated on the fact that the PPP will fund the remainder of what is needed.

Last week, I asked the trade unions in my constituency what guarantees there were that the new Scottish centre would go ahead if the PPP were delayed any longer. Dave Carty, vice chairman of the local branch of the trade union to which NATS employees belong, told the Ayr Advertiser last week: If it gets underway, great. We have heard so many promises up until now. Seeing is believing. It will another five years with the present conditions. There is quite a lot of work going on. Our traffic has increased by eight per cent. every year. That's with no extra staff. The waiting is constant.

Yes, the waiting is constant, and Tory party policy in this House and in Scotland is for further delay and full-scale privatisation. For the sake of jumping on yet another political bandwagon, 700 jobs in my constituency would be lost for good. The Tories are joined by the Scottish National party, which also supports delay, no matter what the cost. Do not play politics with 700 Scottish jobs. They should keep their hands off those jobs or they will never be forgiven by the Scottish people.

6.30 pm

Mr. McDonnell

My hon. Friend the Member for South Derbyshire (Mr. Todd) spoke earlier, and while I respect his every contribution—they are very considered—I have to say that there are others of us who also come from private and public sector backgrounds. Even when I was a chief executive in local government, I managed a commercial operation within the private sector. I bring to this debate that experience, as does my hon. Friend.

The issue for us is not about the dogmatic approach of "public good, private bad" but about the decision-making process of this dangerous policy. In the passage from policy to legislation, I believe that politics, policy making, Government and Parliament have been shown at their worst. The development of the initial political commitment was based on a deceit. This is not just about the statement at the Labour party conference about the air not being for sale. Air traffic controllers in my constituency received letters from Labour party spokespeople saying that there will be no sell-off.

My right hon. Friend the Member for Edinburgh, East and Musselburgh (Dr. Strang) did not divulge what went on when he was on the Front Bench, and I honour him for that. However, we all know what happened. During the election campaign, the Tories found a black hole in our Budget proposals, and every Labour Front-Bench spokesperson was supposed to come up with a proposal to fill that black hole. The air traffic control sell-off was brought back on to the agenda to plug the gap. It was panic selling as a knee-jerk reaction to an issue in the election campaign.

If this does not show policy making or politics being degraded, it is government by fix. We know that the Government have the resources to avoid making this sale but the Treasury is demanding that the Deputy Prime Minister go ahead with the policy. It is allowing him to swing in the wind. This is about high politics in Cabinet—it has nothing to do with the policy itself. The tragedy is that the determination and commitment for which we all admire the Deputy Prime Minister—his ability to see things through to the end, as he has done on so many occasions—has become a terrible weakness and liability. It has become a determination not even to countenance the possibility of being wrong.

This issue has shown Parliament at its worst as well, although some good speeches have been made. We used to say that ambassadors were honest men sent abroad to lie. Junior Ministers have come to the House and, although I do not want to be rude, it is a case of the production of bovine faeces. The statements that have been made time and again in a serious debate are unbelievable. They have not addressed the issues and concerns that have been raised.

I say to my fellow Back Benchers that there are issues of principle here. Tonight we cannot allow principles to be put up for sale as well as air traffic control: this is too important. My hon. Friend the Member for Reading, West (Mr. Salter) said that we should have learned our lesson after what happened in the summer and the ensuing claims about arrogance. We are still affected by the 75p pension increase. I think that in some constituencies we are also still affected by the mayoral election stitch-up. We are still affected by asylum vouchers and lone parent benefit cuts. We must learn our lesson.

The Government have put forward three arguments. They are selling off NATS to introduce new management. They are selling it off because they need the capital. As for our counter-argument, they say that the sale will not affect safety. The last refuge of a defeated intellectual argument is that this is suddenly a constitutional issue.

As for the management argument, we know that NATS is an operational success story. Its annual report for 2000 shows a record number of flights being handled, with a record low number of risk-bearing airprox incidents. In other words, NATS has achieved the highest safety level in our history and across the world. Passenger delays have fallen over the past five years. NATS has also achieved the best level of customer satisfaction in our history.

Mr. Tom Levitt (High Peak)

My hon. Friend talks about the safety record of NATS, which is to be welcomed and praised. I ask, in all innocence, whether there is a difference in the safety record of airports that use NATS as a public service, those which use it as a contract service and those which use private providers instead. If so, would he advise us to avoid certain airports?

Mr. McDonnell

That point has been made time and again. It relates to experiences in the mining industry. I was a full-time officer for the National Union of Mineworkers at one period in my career. We had private mines then, but they were relatively small and insignificant. We set the safety standards in them by ensuring that the major mines stayed in public ownership. Safety standards were dependent upon the scale of public ownership and regulation that set the standards for others in the nationalised industry.

We are talking about 2,000 air traffic controllers, of whom fewer than 200 work in the private sector. Safety standards are set by the 2,000—they are set to standards operating across the country. The other day, my hon. Friend the Member for Luton, South (Ms Moran) described Luton as a safe airport. Luton has just come back under NATS control. NATS is winning contract after contract based upon reliability and guaranteed safety.

The issue here is the failure of project management—we understand that. That is why we want to look for solutions for project management rather than simply selling off NATS. The argument is that project management in the public sector is particularly weak. Yet the channel tunnel was hardly a wonderful example of project management in the private sector. Lord Macdonald argues that there needs to be a shareholder. It did not work with the channel tunnel. There was a single shareholder in the dome, and it did not work there. The argument does not hold water.

We have looked at other forms of contractual arrangements in the public sector to undertake proper project management. They have not even been explored in this debate. If shareholders are required for project management, why is that logic not extended across the health service, the police service and the fire service? Are we really into the full-scale privatisation of public services on a scale not envisaged even by the Opposition?

Reference has been made to these wonderful potential shareholders. I do not even want to mention Lockheed Martin. Serco is just pulling out of Liverpool airport. Earlier in the year, a report was leaked from the Airlines Group in which it examined how contributors to the group could gain preferential treatment in the sky—a lunatic proposal, yet it was being considered seriously.

This takes me back to our experiences as a party when the Conservatives introduced compulsory competitive tendering. There was no market—it had to be invented in order for companies to come forward. That is what is happening here. Yet some companies—Boeing and others—have pulled away because they do not see it as a practical option.

Lord Brett's report is very interesting with regard to the NAVCAN proposals. When the NAVCAN board meets, the airlines press time and again for cost-cutting measures and reductions in charges. In every paragraph of that report, the other partners reject those proposals because the trust binds them into a safety role.

Anyone who knows anything about the airline industry knows that this proposal is already an anachronism. It is a United Kingdom solution, whereas no one is interested in individual in-country solutions. There must be an integrated solution to air traffic control at least across our continent; otherwise we shall not be able to cope with the year-on-year growth of 5 to 6 per cent. A doubling of air traffic is predicted within 10 years. The argument within the industry is based on enhanced technological possibilities, of course, with a Europe-wide solution. Most of the European partners involved in the discussion argue for a public sector solution. We are alone in arguing for a private sector solution.

The International Air Transport Association has said that it looks to a solution through more co-operation between nations in managing pan-European air space. It says that there will be a rationalisation of air traffic control centres. It believes that there needs to be a co-ordinated strategy to create more capacity in the skies: liberalisation but not privatisation. That is the view of one of the organisations of which we are a constituent part.

There needs to be a general technological leap forward. Boeing is arguing for a satellite system. I do not fully understand the merits of that argument, because I believe that there must be a ground-based system at the end of the day. The investment needed to solve the problem goes far beyond the £1.3 billion maximum that we expect to raise through the Government's proposal. We are talking about £20 billion to £30 billion on a European scale. We are leaping ahead of the European discussions about how we arrive at that amount of investment.

It is interesting that the only opportunity for such a level of co-operation is to retain the public sector operation within the UK while the debate continues or to opt for the NAVCAN solution. At least others will have confidence that the priority is safety and service, not privatised profit.

As regards overall capital investments, the NAVCAN solution produces twice the amount of income in terms of the sale. It is bizarre that we are selling off the organisation cheap. We attacked the Tories time and time again for cheap sell-offs, yet we are doing exactly the same thing.

My hon. Friend the Member for Ayr (Ms Osborne) talked about the Scottish air traffic control centre. We were given a commitment that the traditional route would be taken. To me, that means money direct from Government. If that means borrowing on the market through a Government bond, for example, that is another form of the traditional route. If £60 million is required, the NAVCAN solution would provide triple that sum from a sale.

I live among people who work at Heathrow as technicians and at air traffic control centres. What motivates the controllers? My right hon. Friend the Deputy Prime Minister attacked me on this issue and said that industrial reasons lay behind the Government's proposals. My constituents may be passing up the opportunity of up to £50 million in a share-out. Why are they doing that? The issue is not confined to the protection of jobs; it is about doing the right thing for the community. None of them want to live in a community that they may have helped to put at risk. It is as simple as that.

What is the position of some of the ex-members of the Health and Safety Executive? Baroness Gibson, formerly of the TUC, made it clear. She said that when profit comes in, safety is always at risk of going out. That is why she argues so cogently for a not for profit trust.

The argument has been advanced that other parts of the airline industry have been privatised without a decrease in safety. British Airways has been privatised. A report on aviation safety was debated in the House and we found that pilots said that commercial pressures on them were impacting upon safety. The British Airports Authority has been privatised; it is like a city in my constituency, and I work well with it. My right hon. Friend the Deputy Prime Minister has twice called the chief executive of BAA to his office during the Government's term of office to reprimand him for security failures at Heathrow airport. They were the result of commercial contracts involving security. Privatisation lessons have been learned even in the airline industry.

6.45 pm

There is the argument about safety achieved solely through regulation. We seem to have overlooked the fact that, in this instance, safety through regulation is safety at the last stage. Safety must come from within an organisation. That is the lesson that we are learning from Rail track. The HSE and others were incapable of bringing Rail track to heel and making it accept its safety responsibilities. In NATS, everyone is trained to ensure that safety is the first priority. It is deep within the culture of the organisation. As soon as we try in any way to undermine that commitment by introducing the profit element, that culture, built up over the years, will be put at risk.

We were told that there would be a quadruple security lock. We were told that safety regulation would be retained in the hands of the state. We argued for that anyway. We have campaigned for that for ages. That does not undermine the argument that the safety culture must be retained within the organisation.

We have been told that there will be a golden share. That is being challenged in Europe. It is no longer effective and cannot be implemented. The argument has been lost. We were told that there would be a Government director on the board. We have said time and time again that, when the sale takes place, the Government will have only a 20 or 25 per cent. voting option. When we tried to introduce a share voting option in the other place—in other words, some form of majority option vote for Government shareholders—it was rejected. We are left with the licence, which is ineffective if a company is operating in a market and there is no confidence in it.

The Government's final desperate argument is that of constitutional confrontation. If it were up to me, there would be no House of Lords. However, we owe it to the electorate to be honest and straight with them. We need properly to engage in consultation with the NATS work force, who have never been balloted on this issue, except by their own union. As a Labour Government, we should ask the work force what they want. I thought that we stood for that—industrial democracy and a commitment to workers' rights. My hon. Friend the Minister has not visited air traffic control at West Drayton. I live near it. Almost 99.9 per cent. of the work force will be opposed to the Government's proposal. The only person we can find within the organisation who supports it is the chief executive, and he was brought in to carry out what the Government propose.

Some Members may vote with the Government. However, in my view and that of pilots, air traffic controllers, technicians and the public, the proposal will put my constituents at risk. Heathrow is in my constituency, and I must look after my constituents' interests. There were no apologies forthcoming—well, perhaps one—over the sale of Rail track following the accidents at Hatfield, Paddington and Southall. There seems to be less pressure now for accountability over that sale. If the proposed legislation results in one member of my community are being harmed, there will be no absolution from me, and no forgiveness from my community. I will come for those responsible. At the end of the day, as I have said, my job is to look after my constituents' interests. If the Government's proposals are implemented, I believe that their interests will be put at risk.

I am not alone in saying this. My view is shared by every expert in the industry. It is not acceptable to distort party discipline and loyalty by a demand for blind allegiance when the issue is one that puts my constituents at risk.

Mr. Tony McWalter (Hemel Hempstead)

I support the Government on this matter, and I feel a chill wind from my own Benches as I say so. We must address some of the matters that have been raised tonight. Hon. Members should perhaps think about their qualifications and motivations for speaking in this debate. Many Labour Members will know that I am not a serial loyalist and am perfectly happy not to support the Government sometimes. I did not do so on freedom of information, and I probably shall not do so on local government, unless they do something about the poor performance they have given my local community recently.

The question is whether we should consider this matter in a different way to that portrayed by my hon. Friend the Member for Hayes and Harlington (Mr. McDonnell). What are my qualifications for talking about this matter? I cannot pray in aid the time that I spent making sandwiches in the crew canteen at Heathrow airport, although that does at least prove that I have known the airport for a long time. Indeed, many of my family and friends and members of my local community have worked there. I can pray in aid my experience as manager of an information technology unit. In addition, through the parliamentary armed forces scheme, I have had an opportunity to visit many naval establishments at which air traffic control functions are conducted. I had the chance to talk to many of those involved in that process.

I have also examined equipment used by air traffic controllers in the military sector. It is, to put it mildly, antiquated. To put it rather more strongly, it should clearly have been pensioned off long ago. Those systems are inherently dangerous, and people with first-hand expertise say that underinvestment and ancient technology characterise the current system. Yet that system is extraordinarily safe, and I pay tribute to the military sector for its contribution to a staggeringly good record. The people who operate the systems are marvellous. They deal with those systems in ways that counteract the defects. Sometimes, air traffic controllers have to display extraordinary judgment and an ability to deal with a huge number of factors at once. Sometimes, too, they must display real courage. Circumstances can threaten their own lives, and they know that if their decision brings about a crash, they must live with the consequences for the rest of their lives. They are fantastic.

The pilots who work with those controllers know how marvellous and reliable they are. There is a personal relationship between pilots and those on the ground and a confidence built on extraordinary competence. Each year, though, the system gets nearer to the point at which their competence and their adjustments and their capacity for dealing with inherently unsafe technology becomes increasingly necessary. An 8 per cent. annual rise in air traffic is putting ever more demands on the system.

If one asks air traffic controllers whether they want to change their systems, they will say no. They know the system and have been trained in it. They know what to do to keep planes safely in the air. Pilots, if asked to change their systems, will say no. They rely on a system that involves crucial personal contact with someone in whom they have confidence. As the volume rises, however, the dangers of decrepit technology become ever more severe.

Mrs. Gwyneth Dunwoody (Crewe and Nantwich)

Is my hon. Friend suggesting that under privatisation the national en-route centre that is about to come on stream and changes at the London air traffic control centre will be accelerated, changed or improved? There is no indication of that being so.

Mr. McWalter

I thank my hon. Friend for her question. She, and everyone, surely accepts that we need radical change in how services are delivered, and that change is needed soon.

If a fairy godmother appeared before air traffic controllers and pilots and waved her wand to give them a new system that was much better able to control the ever-increasing volume of air traffic in our skies, they would say that they did not want it. They would be receiving something that they could not operate. Pilots would say that they did not want it. They would say, "I know the old system and can rely on it. You are putting me into the sky with something that I am not sure I can rely on."

My hon. Friend the Member for Hayes and Harlington talked about holding people accountable, and even about coming for them if there were some air catastrophe. Let us be blunt: in any change to an inherently dangerous and complex system, there will be danger during the transition. No matter what system is put in place, there will be a period of transition in which there are dangers. That applies whether the change is privatisation, a public-private partnership or wholly in the public sector.

We should not castigate those who must take difficult decisions at a time of risk. At the very least, they deserve our tolerance and understanding. We should all work to ensure that the decisions that we take are as well informed as possible rather than lining up to blame other people when a plane falls out of the sky.

Mr. Don Foster

The hon. Gentleman is keen to use the word "tolerant". Does he believe that air traffic controllers, whom he has praised to the hilt, should be tolerant towards having to cope with an 8 per cent. increase in the number of flights, towards being required under the new regime to make cost savings of between 21 and 35 per cent. over five years, and towards contributing to the profits that the organisation must now make? Should they be tolerant towards all that?

Mr. McWalter

If the description given by the hon. Gentleman is accurate, no.

Mr. Foster

It is.

Mr. McWalter

The issue, in part, is what level of investment will be appropriate, relative to need. I share the feelings expressed by some hon. Members that the plans are insufficiently ambitious, given the huge difficulties that the system will face. Beginning to negotiate that and adjusting it as it goes along are two different things.

7 pm

Earlier, I mentioned that my background is partly in information technology. We could tell air traffic controllers, not that we are going to wave a magic wand, but that we are going to give them a new system for which they will be trained and appropriately skilled, over, say, a three-year period. If, however, that IT system is entirely from the public sector, will they feel that they had been given the safest system imaginable? Labour Members know the history of IT projects that are entirely in the public sector and are aware that those projects have a lamentable record, partly because of problems with underfunding and under-investment. When we employ people in IT in the public sector, we underpay them by a factor of three or four and then wonder why we often get a poor product.

Mr. Gordon Prentice

Did Siemens do a good job for the UK Passport Agency?

Mr. McWalter

Siemens did a terrible job for the Passport Agency, partly because the commission that it was given was drafted by civil servants who failed to understand the most elementary facts when dealing with the process of commissioning IT projects. There is an important issue that relates directly to the question asked by my hon. Friend the Member for Pendle (Mr. Prentice). If one contracts out an IT system and pulls in a product from Siemens, the Electronic Data Systems Corporation or whoever and says, "Thank you, very kind of you to have done this, now we will operate it," it will go bottom up. As we all know, systems so delivered are virtually useless. When one commissions an IT project, one must not simply draft a spec and get people to deliver it, but must get them to operate it so that when it starts to fall down they are responsible for fixing it.

Trying to have that kind of relationship with the appropriate IT provider pushes one in the direction not of old-fashioned commissioning but of involving IT providers and other appropriate providers in matters on a continuing daily basis. That relationship should not be about giving the private sector the job and taking delivery of a product that we operate ourselves, as that would be unsafe and taking heinous, unnecessary and culpable risks. Instead, we should try to ensure that we learn from our mistakes in IT projects in the public sector and have a new management structure that reflects the fact that, for some years to come, the public sector will not have the appropriate IT expertise to commission products or take them and run with them as appropriate.

Some hon. Members have said that there are no arguments in favour of the Government's proposals. However, I have suggested that there are such arguments and that people must think about safety first. Delivering safety involves looking out for the best possible expertise and availing oneself of it at an appropriate cost. If it eventually becomes clear that the relationship between the Government's cost projections, their ambitions and the expertise that they seek to commission involves a mismatch in plans, I will join my colleagues who are going to vote against the measure tonight. However, I will not do that on the basis of the plans that are before us.

Mr. Don Foster

I shall be brief, as I know that other Members wish to speak. The hon. Gentleman has just said that if he is not happy with the funding arrangements for the measure, he is prepared to reconsider how he will vote. May I assure him that the cost reductions of 21 to 35 per cent. in the first five years that I asked him about are the figures in the economic regulation group's recommendations that are currently being talked about.

Mr. McWalter

Tonight's vote is about whether or not to defer the proposals. Issues regularly arise on whether or not projects are effectively funded. I have already said that there is an IT expertise shortfall in much that goes on in such circles. I will be as vigilant as many other hon. Members in ensuring that there is not a shortfall at any stage when those matters are dealt with. I thank the hon. Member for Bath (Mr. Foster) for his comments and shall bear them in mind as the project unfolds.

Mr. Dalyell

As our debate ends at 7.29 pm and as so many important points have been made by my colleagues, I feel that, on reflection, it is more important that the Minister for Housing and Planning has time to reply than that the House has a speech from me.

Dr. Desmond Turner (Brighton, Kemptown)

I am going to be almost as brief as my hon. Friend the Member for Linlithgow (Mr. Dalyell) and make one or two quick points.

The Secretary of State has presented the issue as a constitutional one. However, for Labour Members who are deeply unhappy with the PPP proposals, it is not a constitutional issue—indeed, that is a smokescreen. It is an issue of safety and corporate governance, on which the PPP arguments have unravelled day by day, with further powerful darts being slung in tonight. If the Secretary of State wants us to go into the Lobby, not in support of the PPP—which would be difficult—but to support the Government against a motion for deferral, he must give us an assurance on safety. That assurance must not just be about saying that safety is in public control when regulation is in public control, because the operation is equally crucial.

There is no reason to say that if the PPP does not go ahead, there will be terrible consequences, which the Secretary of State has laid out. That is unnecessary, and there is still time to go down alternative routes, such as that of a trust. If the Secretary of State will say that he is prepared to do that, we shall by all means vote for what he proposes. However, if he does not do that, we have a real problem on the Labour Benches.

Mr. Raynsford

We have had an interesting debate with contributions from both sides of the House. However, it is noticeable that there has been a surprising dearth of Members on the Conservative Benches, despite the fact that we have been debating Lords amendments that were tabled by their colleagues. There has been a fairly significant attendance on the Liberal Democrat Benches and large attendance on the Government Benches, but the House will note that the Conservative Benches have been largely empty for most of our debate.

The hon. Member for North Essex (Mr. Jenkin), speaking for the official Opposition, started out with a rather curmudgeonly series of personal attacks, and then became prickly when it was suggested that his position might not be that of the absolute arbiter of Conservative party policy on the subject. His reluctance to recognise that he is part of a team led by the hon. Member for Tunbridge Wells (Mr. Norman) has become familiar to us. It reminded me of the line from Shakespeare—Richard II, I think: Man, proud man, Drest in a little brief authority. We welcome the hon. Gentleman's presence, but I hope that he will recognise that he has to prove himself by his performance rather than his stated claim to a particular status.

The hon. Gentleman raised a number of questions. He took the view that the operational split could go ahead without the change of ownership. I disagree with him. Only if we implement the transfer schemes will we be able to take NATS out of the ownership of the CAA. It is essential, therefore, to proceed with the legislation to enable that to happen.

The hon. Gentleman went on to talk about shareholder dilution, and claimed that the power of the Secretary of State to amend clause 48—a Henry VIII clause—would make the safeguards worthless. I have to remind him that the power to amend the Crown shareholding section can be exercised only by affirmative resolution and is thus subject to parliamentary approval and the full parliamentary process. The Government take that seriously, even if the hon. Gentleman does not.

My right hon. Friend the Member for Edinburgh, East and Musselburgh (Dr. Strang) started by giving a fairly detailed explanation of the circumstances leading up to his written statement to the House on 11 June 1998. He expressed concern throughout his speech about safety issues. It was in that very statement on 11 June 1998, whatever his concern may have been about the background to it, that he said: This package, taken together,— he was referring to the PPP proposal— will guarantee the highest safety standards as air transport increases in the future.—[Official Report, 11 June 1998; Vol. 313, c. 637W.] He said in a press release issued by the Department of the Environment, Transport and the Regions: Safety will remain the overriding priority with NATS subject to independent safety regulation to a very high standard. He was right in that statement, and that remains the case today.

Mr. Gordon Prentice

In 1997, I was Parliamentary Private Secretary to my right hon. Friend the Member for Edinburgh, East and Musselburgh (Dr. Strang), who was then Minister of Transport. I recall vividly his saying to me, "We should not be doing this." He mentioned it to me a number of times. I urge my hon. Friend the Minister to accept that as the truth.

Mr. Raynsford

That may well be the case, but if so, my right hon. Friend the Member for Edinburgh, East and Musselburgh will have to explain why he made it clear on the record in the House that the package would guarantee the highest safety standards, and explain his other comments that I have quoted. If he believed that that was not the case, we would all have to say that he should not have put his name to that statement.

Mr. Winnick

Does my hon. Friend accept that, even if my right hon. Friend the Member for Edinburgh, East and Musselburgh (Dr. Strang) was in favour of what is being proposed, it would not make the slightest difference to my views and the way in which I will deal with the matter when it comes to voting? Although I can understand my hon. Friend quoting my right hon. Friend, the fact remains that what matters is the substance of the matter, as I said when the hon. Member for North Essex (Mr. Jenkin) was talking about the absence of the Deputy Prime Minister, not who said what or when. What matters is whether the proposal is right or wrong, and I happen to believe that it is wrong.

Mr. Raynsford

The substance of the matter is clearly whether we believe that the PPP delivers the highest possible safety standards. We happen to believe that it does. We have strong evidence to support that case, which I shall outline in my speech. Those who do not believe it have to provide evidence. My right hon. Friend the Member for Edinburgh, East and Musselburgh was clearly confident enough to say on the record in the House in June 1998 that safety would be guaranteed fully under the PPP. I support that point. When a statement of that nature is given to the House, the Member who makes it usually thinks carefully and seriously before giving it. I hope that my right hon. Friend reached a fully informed view which led to that statement. I have certainly looked into the matter carefully before coming to the House to give the statements that I have given tonight on behalf of the Government. I do not make those comments loosely or casually.

7.15 pm

Mr. McDonnell

It is demeaning to have tittle-tattle between members of our party, not least because the Minister came to the House to tell us that the Mayor would be selected on the basis of one member one vote, and then supported the alternative system. Let us get on with the debate.

Mr. Speaker

Order. The Mayor is nothing to do with the matter before us.

Mr. Raynsford

I will come back to my hon. Friend later.

Dr. Godman

I have said on numerous occasions that I have every trust in my right hon. Friend the Deputy Prime Minister's commitment to maritime, rail, road and air safety, but I share many of my constituents deep mistrust of privatisation, and the PPP in this case. It is a question not of safety but of ideology and mistrust of privatisation, whether part or whole.

Mr. Raynsford

I hear the point that my hon. Friend makes. He made it in an earlier intervention, and I intended to respond to it later. I do not believe that safety is a matter of ideology. Safety is a matter of safety, and we should consider it on that basis. I shall explain why in a moment. My hon. Friend is right to emphasise that my right hon. Friend the Deputy Prime Minister is absolutely committed to the maintenance of the safest possible regime in respect not only of air traffic control but other transport modes.

My right hon. Friend the Member for Edinburgh, East and Musselburgh referred to issues of national security. It is important to put on record the fact that the proposal for the PPP has been discussed in detail with the Ministry of Defence. There has been a great deal of discussion about how the arrangements will work in practice, and the MOD is satisfied that the arrangements will provide an utterly satisfactory guarantee of national security. We should expect nothing less.

My right hon. Friend the Member for Edinburgh, East and Musselburgh also raised the question of foreign ownership. We do not rule out the possibility. It would be odd and slightly illogical to do so, given that we believe that air traffic services throughout the world will change in the years ahead, and there may well be a consolidation crossing national boundaries, in which case there is bound to be some element of foreign ownership. However, there must be absolutely satisfactory frameworks in place to secure the national interest in the event of a national emergency—clauses 87 and 88 provide that—and proper safeguards to ensure that whoever is selected as a strategic partner is an appropriate and safe person to entrust with this important service.

In Committee, we went at length through the detailed safeguards that are in place. I will not detain the House by going through them again because time is short; we have only 10 minutes left for this debate. However, I assure hon. Members on both sides of the House that a series of interlocking safeguards will ensure that only an appropriate and safe person can be appointed to the important role of the strategic partner.

The hon. Member for Tweed dale, Ettrick and Lauderdale (Mr. Moore) raised concerns about potential conflicts of interest. The Government have given that matter considerable and careful attention. We have made the necessary arrangements to ensure that any perceived or actual conflict of interest will be addressed and will be resolved during the bidding process. We have built a two-stage check—each bidding group has been required to identify and suggest remedies that will resolve to our complete satisfaction any conflicts of interest that may have existed as the groups submitted their initial, indicative bid—[HON. MEMBERS: "How?"] Only bidders who gave us that satisfaction have been allowed to participate in the next stage.

The second check comes into play in the final stage. It will require an exhaustive and detailed account of how each proposed strategic partner would demonstrate to us that any remaining conflict issues could be handled. No group would be appointed as the strategic partner if there was any doubt as to how conflicts would be neutralised.

The hon. Member for Tweeddale, Ettrick and Lauderdale mentioned the attitude of the safety regulatory group. I assure the House that the Civil Aviation Authority—including the SRG—firmly supports the PPP. The SRG has assured the Government that it is wholly confident of maintaining safety under the PPP. I repeat that the amendments that we shall discuss later make safety the No. 1 priority; they will require the maintenance of the highest safety standards, whether or not they are above the statutory minimum.

Mr. Dalyell

Will the SRG have the resources to undertake that work with the few inspectors it currently has at its disposal?

Mr. Raynsford

I assure my hon. Friend that if the SRG believes that it needs more resources, it will put that to the Government; we shall consider such a request very sympathetically indeed. We are absolutely committed to ensuring that there is a safety regime that ensures that safety is the No. 1 priority. We will not deny the SRG the resources to deliver that regime. I give that assurance clearly.

The hon. Member for Tweeddale, Ettrick and Lauderdale also suggested that there might be a problem with the charge cap in relation to the PPP company. Ministers will set the cap and will take account of CAA advice in doing so, but we shall also take other factors into account—including the comments of NATS. On no account—again, I can give the House an assurance—will we set the cap at a level that will create operational difficulty for NATS, or that will raise the slightest question of a risk to safety.

My hon. Friend the Member for South Derbyshire (Mr. Todd) made a thoughtful speech in which he rightly highlighted the complex issues. He also stressed the importance of avoiding the stereotyping of the public and private sectors. I very much agreed with his views, which were based on detailed experience—not least of his local East Midlands airport.

The hon. Member for Eastleigh (Mr. Chidgey) misinterpreted my comments about the possibility that recruitment to air traffic control was being adversely affected. To make the matter absolutely clear, I said that, if there was a further period of delay and uncertainty, it would be likely to have an adverse effect on the ability of NATS to recruit the necessary staff. Uncertainty is wholly undermining to services such as those provided by NATS.

The hon. Gentleman asked whether we needed the proposed solution of the PPP. Surprisingly, he made that point after noting in his opening remarks the regrettable delays and the cost overruns that have occurred at Swanwick near his constituency. As I shall emphasise at the end of my comments, it is precisely such problems as delays and overruns that make it essential that we establish a structure that will ensure efficient and effective operation of the service, including the procurement of the new technology that is vital to its future success.

I was a little surprised by the claim of my hon. Friend the Member for Reading, West (Mr. Salter) at the beginning of his speech that he had spoken regularly to Ministers; neither the Under-Secretary of State, my hon. Friend the Member for Streatham (Mr. Hill), nor I have held any detailed discussion with him on this issue.

Mr. Salter

Does the Minister agree that the Prime Minister, the Chancellor, the Deputy Prime Minister and other Members who are high up the ministerial ladder do count as Ministers? Many of us have engaged in intensive discussions on this matter for a long time.

Mr. Raynsford

I am delighted to know that my hon. Friend moves in such illustrious company.

My hon. Friend referred to the NAVCAN model. The Government have set out the view that the future of NATS is best assured through the creation of a PPP; that remains our view. The NAVCAN experience may well suit Canadian circumstances, but we do not believe that it is necessarily the best solution in this country. However, a number of frameworks similar to those in the NAVCAN model will apply in the PPP; there will be Government-appointed directors; there will be consultation on any charging regime; safety regulation will be carried out by a public sector authority; and there will be Government emergency powers of regulation and direction. Those aspects are shared with the NAVCAN model.

My hon. Friend the Member for Ayr (Ms Osborne) rightly highlighted worry about the 700 jobs in her constituency that could be put in jeopardy by any delay. She dealt most effectively with an intervention from the hon. Member for Bath (Mr. Foster) when she clearly made the point that safety is not part of this amendment. The amendment is about delay, and my hon. Friend has every reason to feel worried about the risk to the jobs of her constituents and to the two-centre strategy if the whole venture were to be delayed for no good reason—which would be the effect of the amendments we are discussing.

My hon. Friend also referred to the views of the economic regulatory group on capital expenditure. I make it clear that the advice from the ERG did not propose cuts in NATS capital spending. The group questioned NATS' track record in achieving its capital expenditure targets—as well it might. The real question is about what the strategic partner can achieve with effective project management experience. We shall address that question in taking decisions on charge control. Whatever decisions we take will facilitate the investment that is so desperately needed.

My hon. Friend the Member for Hayes and Harlington (Mr. McDonnell) described the proposal as potentially dangerous, but he offered no evidence whatever for that allegation. Without objective evidence that there is a threat to the safety of air passengers, I regard such comments as unhelpful; they inflame fears without sound grounding. My hon. Friend gave a rather fanciful interpretation of the way in which the Government have approached the project and took—if I may so—an uncomradely view of Ministers' handling of it. He, too, spoke about NAVCAN, and I have already responded on that matter.

My hon. Friend expressed the view that private company interests inherently threaten safety. He said that when profit goes in, safety goes out.

Mr. McDonnell

Will the Minister give way?

Mr. Raynsford

I contrast my hon. Friend's very ideological view with the measured and well-informed view of my—

Mr. McDonnell

Will the Minister give way?

Mr. Speaker

Order. The Minister does not seem to be giving way.

Mr. Raynsford

Thank you, Mr. Speaker. I am coming to the end of my remarks—there is only half a minute left for the debate.

The views of my hon. Friend the Member for Hayes and Harlington are in contrast with those expressed by my hon. Friend the Member for Hemel Hempstead (Mr. McWalter), who rightly based his remarks on his practical experience of IT and highlighted the importance of good and successful procurement.

Our proposals have been considered carefully; they place an absolute emphasis on safety as the No. 1 priority and they will provide the necessary investment. I urge the House to reject the amendments.

It being three and a half hours after the commencement of proceedings on the Ways and Means resolution, MR. SPEAKER, pursuant to Order [this day], put forthwith the Question already proposed from the Chair.

Question put, That this House disagrees with the Lords in the said amendment:—

The House divided: Ayes 321, Noes 228.

Division No. 335]	[7.29 pm
AYES
Adams, Mrs Irene (Paisley N)	Campbell, Alan (Tynemouth)
Ainger, Nick	Campbell, Mrs Anne (C'bridge)
Ainsworth, Robert (Cov'try NE)	Campbell, Ronnie (Blyth V)
Alexander, Douglas	Campbell-Savours, Dale
Allen, Graham	Cann, Jamie
Anderson, Donald (Swansea E)	Caplin, Ivor
Anderson, Janet (Rossendale)	Casale, Roger
Armstrong, Rt Hon Ms Hilary	Cawsey, Ian
Ashton, Joe	Chapman, Ben (Wirral S)
Atherton, Ms Candy	Church, Ms Judith
Atkins, Charlotte	Clark, Rt Hon Dr David (S Shields)
Banks, Tony	Clark, Paul (Gillingham)
Barron, Kevin	Clarke, Charles (Norwich S)
Battle, John	Clarke, Eric (Midlothian)
Bayley, Hugh	Clarke, Rt Hon Tom (Coatbridge)
Beard, Nigel	Clarke, Tony (Northampton S)
Beckett, Rt Hon Mrs Margaret	Clelland, David
Begg, Miss Anne	Clwyd, Ann
Bell, Stuart (Middlesbrough)	Coaker, Vernon
Benn, Hilary (Leeds C)	Coleman, Iain
Bennett, Andrew F	Colman, Tony
Benton, Joe	Cooper, Yvette
Bermingham, Gerald	Corbett, Robin
Berry, Roger	Corston, Jean
Blackman, Liz	Cousins, Jim
Blair, Rt Hon Tony	Cranston, Ross
Blears, Ms Hazel	Crausby, David
Blizzard, Bob	Cummings, John
Blunkett, Rt Hon David	Cunningham, Rt Hon Dr Jack (Copeland)
Boateng, Rt Hon Paul
Borrow, David	Cunningham, Jim (Cov'try S)
Bradley, Keith (Withington)	Curtis-Thomas, Mrs Claire
Bradley, Peter (The Wrekin)	Darling, Rt Hon Alistair
Bradshaw, Ben	Darvill, Keith
Brinton, Mrs Helen	Davey, Valerie (Bristol W)
Brown, Rt Hon Gordon (Dunfermline E)	Davies, Geraint (Croydon C)
	Dawson, Hilton
Brown, Rt Hon Nick (Newcastle E)	Denham, John
Brown, Russell (Dumfries)	Dobson, Rt Hon Frank
Browne, Desmond	Donohoe, Brian H
Burden, Richard	Doran, Frank
Butler, Mrs Christine	Dowd, Jim
Byers, Rt Hon Stephen	Drew, David
Caborn, Rt Hon Richard	Drown, Ms Julia

Eagle, Angela (Wallasey)	Kilfoyle, Peter
Eagle, Maria (L'pool Garston)	King, Andy (Rugby & Kenilworth)
Edwards, Huw	King, Ms Oona (Bethnal Green)
Efford, Clive	Kumar, Dr Ashok
Ellman, Mrs Louise	Ladyman, Dr Stephen
Ennis, Jeff	Lammy, David
Fitzpatrick, Jim	Lawrence, Mrs Jackie
Fitzsimons, Mrs Lorna	Laxton, Bob
Flint, Caroline	Leslie, Christopher
Flynn, Paul	Levitt, Tom
Follett, Barbara	Lewis, Ivan (Bury S)
Foster, Rt Hon Derek	Liddell, Rt Hon Mrs Helen
Foster, Michael Jabez (Hastings)	Linton, Martin
Foster, Michael J (Worcester)	Lloyd, Tony (Manchester C)
Foulkes, George	Lock, David
Galbraith, Sam	Love, Andrew
Gapes, Mike	McAvoy, Thomas
Gardiner, Barry	McCabe, Steve
George, Bruce (Walsall S)	McDonagh, Siobhain
Gilroy, Mrs Linda	Macdonald, Calum
Godsiff, Roger	McFall, John
Goggins, Paul	McGuire, Mrs Anne
Golding, Mrs Llin	McIsaac, Shona
Griffiths, Jane (Reading E)	McKenna, Mrs Rosemary
Griffiths, Nigel (Edinburgh S)	Mackinlay, Andrew
Griffiths, Win (Bridgend)	McNulty, Tony
Grocott, Bruce	MacShane, Denis
Hain, Peter	Mactaggart, Fiona
Hall, Patrick (Bedford)	McWalter, Tony
Hamilton, Fabian (Leeds NE)	Mallaber, Judy
Hanson, David	Mandelson, Rt Hon Peter
Harman, Rt Hon Ms Harriet	Marsden, Gordon (Blackpool S)
Healey, John	Marsden, Paul (Shrewsbury)
Henderson, Doug (Newcastle N)	Marshall, David (Shettleston)
Henderson, Ivan (Harwich)	Martlew, Eric
Hepburn, Stephen	Maxton, John
Heppell, John	Meacher, Rt Hon Michael
Hewitt, Ms Patricia	Meale, Alan
Hill, Keith	Merron, Gillian
Hodge, Ms Margaret	Michael, Rt Hon Alun
Hoey, Kate	Milburn, Rt Hon Alan
Hood, Jimmy	Miller, Andrew
Hoon, Rt Hon Geoffrey	Moffatt, Laura
Hope, Phil	Moonie, Dr Lewis
Howarth, Alan (Newport E)	Moran, Ms Margaret
Howarth, George (Knowsley N)	Morgan, Ms Julie (Cardiff N)
Howells, Dr Kim	Morgan, Rhodri (Cardiff W)
Hoyle, Lindsay	Moriey, Elliot
Hughes, Ms Beverley (Stretford)	Morris, Rt Hon Ms Estelle (B'ham Yardley)
Hughes, Kevin (Doncaster N)
Humble, Mrs Joan	Morris, Rt Hon Sir John (Aberavon)
Hurst, Alan
Hutton, John	Mountford, Kali
Iddon, Dr Brian	Mowlam, Rt Hon Marjorie
Ingram, Rt Hon Adam	Mullin, Chris
Jackson, Helen (Hillsborough)	Murphy, Denis (Wansbeck)
Jamieson, David	Murphy, Jim (Eastwood)
Jenkins, Brian	Murphy, Rt Hon Paul (Torfaen)
Johnson, Alan (Hull W& Hessle)	Naysmith, Dr Doug
Johnson, Miss Melanie (Welwyn Hatfield)	Norris, Dan
	O'Brien, Bill (Normanton)
Jones, Rt Hon Barry (Alyn)	O'Brien, Mike (N Warks)
Jones, Mrs Fiona (Newark)	O'Hara, Eddie
Jones, Helen (Warrington N)	Olner, Bill
Jones, Jon Owen (Cardiff C)	O'Neill, Martin
Jones, Martyn (Clwyd S)	Organ, Mrs Diana
Jowell, Rt Hon Ms Tessa	Osborne, Ms Sandra
Kaufman, Rt Hon Gerald	Palmer, Dr Nick
Keeble, Ms Sally	Pearson, Ian
Keen, Alan (Feltham & Heston)	Pendry, Tom
Keen, Ann (Brentford & Isleworth)	Perham, Ms Linda
Kelly, Ms Ruth	Pickthall, Colin
Kemp, Fraser	Pike, Peter L
Kennedy, Jane (Wavertree)	Plaskitt, James
Khabra, Piara S	Pollard, Kerry
Kidney, David	Pond, Chris

Pope, Greg	Stewart, Ian (Eccles)
Pound, Stephen	Stinchcombe, Paul
Prentice, Ms Bridget (Lewisham E)	Stoate, Dr Howard
Prescott, Rt Hon John	Straw, Rt Hon Jack
Primarolo, Dawn	Stringer, Graham
Purchase, Ken	Stuart, Ms Gisela
Quin, Rt Hon Ms Joyce	Sutcliffe, Gerry
Quinn, Lawrie	Taylor, Rt Hon Mrs Ann (Dewsbury)
Radice, Rt Hon Giles
Rammell, Bill	Taylor, Ms Dari (Stockton S)
Rapson, Syd	Temple-Morris, Peter
Raynsford, Nick	Thomas, Gareth (Clwyd W)
Reed, Andrew (Loughborough)	Thomas, Gareth R (Harrow W)
Reid, Rt Hon Dr John (Hamilton N)	Timms, Stephen
Roche, Mrs Barbara	Tipping, Paddy
Rogers, Allan	Todd, Mark
Rooker, Rt Hon Jeff	Touhig, Don
Rooney, Terry	Trickett, Jon
Ross, Ernie (Dundee W)	Turner, Dennis (Wolverh'ton SE)
Rowlands, Ted	Turner, Dr George (NW Norfolk)
Roy, Frank	Turner, Neil (Wigan)
Ruane, Chris	Twigg, Derek (Halton)
Ruddock, Joan	Twigg, Stephen (Enfield)
Russell, Ms Christine (Chester)	Tynan, Bill
Ryan, Ms Joan	Vaz, Keith
Sarwar, Mohammad	Walley, Ms Joan
Savidge, Malcolm	Ward, Ms Claire
Sawford, Phil	Watts, David
Sedgemore, Brian	White, Brian
Sheerman, Barry	Whitehead, Dr Alan
Shipley, Ms Debra	Wicks, Malcolm
Singh, Marsha	Williams, Alan W (E Carmarthen)
Smith, Rt Hon Andrew (Oxford E)	Williams, Mrs Betty (Conwy)
Smith, Angela (Basildon)	Wills, Michael
Smith, Miss Geraldine (Morecambe & Lunesdale)	Wilson, Brian
	Winterton, Ms Rosie (Doncaster C)
Smith, Jacqui (Redditch)	Woodward, Shaun
Smith, John (Glamorgan)	Woolas, Phil
Snape, Peter	Worthington, Tony
Soley, Clive	Wright, Anthony D (Gt Yarmouth)
Southworth, Ms Helen	Wright, Tony (Cannock)
Spellar, John	Wyatt, Derek
Squire, Ms Rachel
Starkey, Dr Phyllis	Tellers for the Ayes:
Steinberg, Gerry	Mr. Clive Betts and
Stewart, David (Inverness E)	Mr. Mike Hall.
NOES
Ainsworth, Peter (E Surrey)	Burstow, Paul
Allan, Richard	Butterfill, John
Amess, David	Cable, Dr Vincent
Ancram, Rt Hon Michael	Campbell, Rt Hon Menzies (NE Fife)
Arbuthnot, Rt Hon James
Ashdown, Rt Hon Paddy	Cash, William
Atkinson, David (Bour'mth E)	Chapman, Sir Sydney (Chipping Barnet)
Atkinson, Peter (Hexham)
Baldry, Tony	Chaytor, David
Ballard, Jackie	Chidgey, David
Bames, Harry	Chope, Christopher
Beggs, Roy	Clapham, Michael
Beith, Rt Hon A J	Clappison, James
Bell, Martin (Tatton)	Clark, Dr Michael (Rayleigh)
Bercow, John	Collins, Tim
Beresford, Sir Paul	Connarty, Michael
Body, Sir Richard	Cook, Frank (Stockton N)
Boswell, Tim	Corbyn, Jeremy
Bottomley, Peter (Worthing W)	Cormack, Sir Patrick
Brake, Tom	Cotter, Brian
Brand, Dr Peter	Cran, James
Brazier, Julian	Cryer, Mrs Ann (Keighley)
Brooke, Rt Hon Peter	Cryer, John (Hornchurch)
Browning, Mrs Angela	Curry, Rt Hon David
Bruce, Ian (S Dorset)	Dalyell, Tam
Bruce, Malcolm (Gordon)	Davey, Edward (Kingston)
Burnett, John	Davidson, Ian
Burns, Simon	Davies, Rt Hon Denzil (Llanelli)

Davies, Quentin (Grantham)	Livsey, Richard
Davis, Rt Hon David (Haltemprice)	Lloyd, Rt Hon Sir Peter (Fareham)
Day, Stephen	Loughton, Tim
Dobbin, Jim	Lyell, Rt Hon Sir Nicholas
Donaldson, Jeffrey	McDonnell, John
Duncan, Alan	MacGregor, Rt Hon John
Duncan Smith, Iain	McIntosh, Miss Anne
Dunwoody, Mrs Gwyneth	MacKay, Rt Hon Andrew
Emery, Rt Hon Sir Peter	Maclean, Rt Hon David
Etherington, Bill	Maclennan, Rt Hon Robert
Evans, Nigel	McLoughlin, Patrick
Faber, David	Madel, Sir David
Fabricant, Michael	Mahon, Mrs Alice
Fallon, Michael	Malins, Humfrey
Fearn, Ronnie	Maples, John
Field, Rt Hon Frank	Marshall-Andrews, Robert
Flight, Howard	Mates, Michael
Forth, Rt Hon Eric	Maude, Rt Hon Francis
Foster, Don (Bath)	Mawhinney, Rt Hon Sir Brian
Fowler, Rt Hon Sir Norman	May, Mrs Theresa
Fox, Dr Liam	Michie, Bill (Shef'ld Heeley)
Fraser, Christopher	Michie, Mrs Ray (Argyll & Bute)
Garnier, Edward	Moore, Michael
George, Andrew (St Ives)	Morgan, Alasdair (Galloway)
Gibb, Nick	Moss, Malcolm
Gidley, Sandra	Nicholls, Patrick
Gill, Christopher	Norman, Archie
Gillan, Mrs Cheryl	Oaten, Mark
Godman, Dr Norman A	O'Brien, Stephen (Eddisbury)
Gorman, Mrs Teresa	Öpik, Lembit
Gray, James	Page, Richard
Green, Damian	Paice, James
Greenway, John	Pickles, Eric
Grieve, Dominic	Portillo, Rt Hon Michael
Gummer, Rt Hon John	Prentice, Gordon (Pendle)
Hague, Rt Hon William	Prior, David
Hamilton, Rt Hon Sir Archie	Randall, John
Hammond, Philip	Redwood, Rt Hon John
Harris, Dr Evan	Rendel, David
Harvey, Nick	Robathan, Andrew
Hawkins, Nick	Robertson, Laurence
Hayes, John	Roe, Mrs Marion (Broxbourne)
Heald, Oliver	Rowe, Andrew (Faversham)
Heath, David (Somerton & Frame)	Ruffley, David
Heathcoat-Amory, Rt Hon David	Russell, Bob (Colchester)
Heseltine, Rt Hon Michael	St Aubyn, Nick
Hogg, Rt Hon Douglas	Salter, Martin
Hopkins, Kelvin	Sanders, Adrian
Horam, John	Shaw, Jonathan
Howard, Rt Hon Michael	Shephard, Rt Hon Mrs Gillian
Howarth, Gerald (Aldershot)	Shepherd, Richard
Hughes, Simon (Southwark N)	Simpson, Alan (Nottingham S)
Hunter, Andrew	Simpson, Keith (Mid-Norfolk)
Illsley, Eric	Skinner, Dennis
Jackson, Robert (Wantage)	Smith, Llew (Blaenau Gwent)
Jenkin, Bernard	Smith, Sir Robert (W Ab'd'ns)
Johnson Smith,	Spicer, Sir Michael
Rt Hon Sir Geoffrey	Spring, Richard
Jones, Dr Lynne (Selly Oak)	Stanley, Rt Hon Sir John
Jones, Nigel (Cheltenham)	Steen, Anthony
Keetch, Paul	Stevenson, George
Kennedy, Rt Hon Charles (Ross Skye & Inverness W)	Strang, Rt Hon Dr Gavin
	Streeter, Gary
Key, Robert	Stunell, Andrew
King, Rt Hon Tom (Bridgwater)	Swayne, Desmond
Kingham, Ms Tess	Syms, Robert
Kirkbride, Miss Julie	Tapsell, Sir Peter
Kirkwood, Archy	Taylor, David (NW Leics)
Laing, Mrs Eleanor	Taylor, Ian (EsherS &Walton)
Lait, Mrs Jacqui	Taylor, John M (Solihull)
Lansley, Andrew	Taylor, Matthew (Truro)
Letwin, Oliver	Taylor, Sir Teddy
Lewis, Dr Julian (New Forest E)	Thomas, Simon (Ceredigion)
Lidington, David	Thompson, William
Lilley, Rt Hon Peter	Tonge, Dr Jenny
Livingstone, Ken	Tredinnick, David

Trend, Michael	Widdecombe, Rt Hon Miss Ann
Turner, Dr Desmond (Kemptown)	Willetts, David
Tyler, Paul	Willis, Phil
Tyrie, Andrew	Wilshire, David
Viggers, Peter	Winnick, David
Wallace, James	Winterton, Mrs Ann (Congleton)
Walter, Robert	Winterton, Nicholas (Macclesfield)
Wareing, Robert N	Wood, Mike
Waterson, Nigel	Yeo, Tim
Webb, Steve	Young, Rt Hon Sir George
Wells, Bowen
Welsh, Andrew	Tellers for the Noes:
Whitney, Sir Raymond	Mr. Peter Luff and
Whittingdale, John	Mr. Geoffrey Clifton-Brown.

Question accordingly agreed to.

Lords amendment disagreed to.

Lords amendments Nos. 28 and 29 disagreed to.