HL Deb 08 April 1965 vol 265 cc175-7

3.10 p.m.

LORD ERROLL OF HALE

My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.

[The Question was as follows:

To ask Her Majesty's Government what opportunity was provided for British firms of industrial and management consultants to offer to carry out the work for the British Post Office which is about to be undertaken by an American firm; and how many American firms were considered before the final choice was made.]

LORD HOBSON

My Lords, the decision to employ Messrs. McKinseys to undertake a fundamental review of the postal services was taken by my right honourable friend the Postmaster General because he considered that they were particularly suitable for the task. This particular company have undertaken somewhat similar reviews for a number of the largest industrial concerns in this country.

LORD ERROLL OF HALE

My Lords, while thanking the noble Lord for his reply, may I ask him to explain why no British firms were considered for appointment or given the opportunity to put in what one might call competitive tenders or provide programmes of work, and why no other American firms—if for some strange reason all British firms have to be excluded—were considered? Is it not a very extraordinary way in which to carry out business on behalf of a great Government Department, to award a piece of work without any competition or competitive tendering of any sort?

LORD HOBSON

My Lords, let me preface the answer to the question by saying that in the matter of contracts in the Post Office it is always a question of tendering. With regard to industrial consultants, my right honourable friend took the view that this is a very limited field in which selection could be made, and using his judgment and expertise he thought this firm was the best one to do the job.

LORD ERROLL OF HALE

My Lords, I should be most grateful to learn what particular expertise this young gentleman has, apart from his ability to stay out of your Lordships' Chamber. In any event, would it not have been wise for him at least to consult British firms, many of whom are of international repute, who have done work every bit as important as has the firm selected, who in one case have carried out valuable work for the Swiss Post Office, earning commendation from them, and have carried out other work abroad and at home, and would be willing to do the work if given the opportunity of putting in a bid for it?

LORD HOBSON

My Lords, I think that one has to assume—and the assumption is correct—that the factors which the noble Lord has just stated, which led up to the Postmaster General making the decision, were borne in mind not only by him but also, of course, by the experts within the Department who would presumably be present to advise him when the decision was made.

LORD BROWN

My Lords, is it not a fact that it would introduce an entirely new principle into the engagement of professional advisers, whether business consultants or legal people, to put up opportunities for so advising for competitive tender?

LORD HOBSON

I understand that that would not conform to professional protocol.

LORD DERWENT

My Lords, I still do not understand the answers given by the noble Lord. Is he in fact saying that in the opinion of the Postmaster General there is no British firm which would be as good at doing this job?

LORD HOBSON

My Lords, my right honourable friend did not say that, but the Post Office has had ten British consultants over the last ten years inquiring into efficiency and methods of the British Post Office. Bearing this in mind when he was considering a further review of the efficiency of the Post Office, he considered American firms as well; and the decision that he arrived at was that this particular American firm was the most suitable to perform the task.

LORD DERWENT

My Lords, with great respect to the noble Lord, he has already said that they did not consider American firms.

LORD HOBSON

My Lords, I did not say that; I said that American firms had not tendered.

LORD ERROLL OF HALE

My Lords, why were they not invited to tender?

LORD HOBSON

My Lords, as I answered in the first part of my reply, it is not usual for tenders to be considered for matters of this sort. With regard to Post Office contracts, certainly; but when you are dealing with a question of securing the services of professional advisers, it is not usual to hawk around and ask for tenders.

LORD STRATHCLYDE

My Lords, is it the policy of Her Majesty's Government always to consult foreigners about our affairs?

LORD HOBSON

My Lords, that is an entirely false assumption on the noble Lord's part.

LORD ERROLL OF HALE

My Lords, may I, by way of explanation, say that I said "competitive tenders" as a means of making the point readily; but why should not "programmes of work" be called for?—which is the correct phrase in the jargon of this particular industry.

LORD HOBSON

My Lords, the noble Lord has now put forward a further point, and if he cares to put down another Question about it I shall be only too happy to answer it to the best of my ability.