HL Deb 16 November 1976 vol 377 cc1238-41

58 Clause 47, page 64, line 26, leave out from "in'' to end of line 27 and insert "one or more of the activities specified in section 2(1) or (2) above, other than—

(a) a Corporation, or''.

59 Clause 47, page 64, line 32, leave out "British Shipbuilders" and insert "a Corporation".

60 Clause 47, page 64, line 33, leave out "the sale of ships" and insert "that or those activities".

61 Clause 47, page 64, line 35, leave out sub section (2).

62 Clause 47, page 65, line 8, leave out "British Shipbuilders" and insert "the Corporation concerned".

63 Clause 47, page 65, line 10, leave out "British Shipbuilders" and insert "the Corporation".

64 Clause 47, page 65, line 12, leave out "British Shipbuilders" and insert "the Corporation".

65 Clause 47, page 65, line 17, leave out "British Shipbuilders" and insert "the Corporation".

66 Clause 47, page 65, line 23, leave out "British Shipbuilders" and insert "the Corporation".

67 Clause 47, page 65, line 30, leave out "British Shipbuilders" and insert "the Corporation".

The Commons disagreed to these Amendments for the following Reasons:

68 Because they would undesirably extend the clause.

Lord WINTERBOTTOM

My Lords, I beg to move that this House doth not insist on their Amendments Nos. 58 to 67 en bloc, to which the Commons have disagreed for the Reason numbered 68.

When the Government accepted during Committee stage in this House the need for this clause covering shipbuilding and ship repairing, they were not accepting that the fair trading legislation introduced by the Party opposite was deficient in that in general a procedure such as that in Clause 47 is necessary or desirable when a nationalised industry is competing with the private sector in either its main line or its ancillary activities. We recognise special circumstances in shipbuilding and ship repairing where some yards will remain outside public ownership. We strongly consider that the only activities of British Shipbuilders which should be covered by fair trading provisions are the sale of ships and the provision of ship repair services; just as Section 30 of the Iron and Steel Act 1967 was also restricted to the selling of certain iron and steel products and covered no other activity.

So far as sale and provision of services is concerned with respect to aircraft there will be no private sector company in this country manufacturing complete fixed wing aircraft or guided weapons—apart from Britten Norman which assembles light aircraft mainly builtabroad. Therefore, providing for an equivalent provision to Clause 47 for British Aerospace is unnecessary. By extending the scope of the clause to all activities of the Corporation your Lordships would risk subjecting a vital part of our national heritage to restrictions which would inhibit its commercial success, on the pretext of protecting competitors who are already quite adequately protected. We see no reason why the legislation passed by the Party opposite to ensure fair trading by both very large public and private sector companies and monopolies should not be adequate for these Corporations.

Aside from the substantial fair trading legislation which will apply to the two Corporations I can of course reiterate our assurance that British Shipbuilders and British Aerospace would have no wish to extract unfair advantages. Both Chairmen of the Organising Committees have agreed to make a formal policy statement on future trading practices in due course and they are both deeply committed to fair trading. I therefore urge noble Lords not to insist on these Amendments.

Moved, That the House doth not insist on the said Amendments, to which the Commons have disagreed for the Reason numbered 68.—(Lord Winterbottom.)

Lord CARR of HADLEY

My Lords, it is no good pretending that we are anything but disappointed at the Government's attitude and the decision of the other place in relation to the Amendments. I shall not ask the House to divide on this matter. I do not think it is a matter on which your Lordships would think it desirable to get into an ultimate state of conflict with the other place; but the situation is unsatisfactory because the reasons that the Government accepted in the end were valid in persuading them to include British Shipbuilders really are equally valid in relation to the aircraft side. The noble Lord said that it was recognised that on the shipbuilding side there were some yards outside public ownership. As far as aircraft were concerned, he seemed to think that no such clash could arise. I rather thought that one of the reasons why Scottish Aviation was being included in the Corporation was so that there might be a light aircraft producer within the Corporation in the future. So there could well be a light aircraft producer both inside the Corporation and outside public ownership. Therefore, so far as aircraft production is concerned, there is or is foreseeably liable to be—one does not have to use much imagination to foresee it—a likelihood of this arising. There are exactly the same circumstances as persuaded the Government that a fair trading clause was necessary for shipbuilding.

Returning to repairing, again I understand that the Government agreed to ship repairing having a fair trading clause because of the fact that there will be ship repairers outside the public sector. Indeed, they are all to be outside the public sector, but that is another matter and of course that will not be so because the ship builders themselves may undertake repairing activities. However, as I pointed out at an earlier stage, there are major aircraft repairers in the private sector and will continue to be so in the future. So, once again, the very arguments that led the Government to accept a fair trading clause for the shipbuilding and ship repairing sides apply—perhaps not on such a scale at the moment—in principle and practice equally to the aircraft side.

I shall not tonight go into all the other aspects other than sale but, if one looks only at the one activity of sale the same arguments really apply, not just in theory but in practice, to British Aerospace as apply to British Shipbuilders. I repeat that I shall not ask your Lordships to divide on this matter but here again this is a matter where there ought to be the minimum of political conflict and the maximum of desire for consensus. It is immensely disappointing that once more the Government's will to reach any consensus seems near to zero.