§ Lord GlenamaraMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ The Question was as follows:
§ To ask Her Majesty's Government what was the total cost of floating 0British Aerospace on the market, including legal fees, commissions and advertising costs, and by whom was this cost borne.
The Minister of State, Department of Employment (The Earl of Gowrie)My Lords, the amount so far paid by Her Majesty's Government to meet the cost of floating British Aerospace is £4.06 million, excluding VAT. The total costs, again excluding VAT, are expected to be between £4 million and £5 million.
§ Lord GlenamaraMy Lords, does the noble Earl feel that this is an exorbitant price to pay for selling off a valuable national asset?
The Earl of GowrieNo, my Lords, I do not. I think it is a pretty small commission in relation to the amount of monies that were raised by selling this asset and in relation to the excellent idea of privatising an industry and getting it off the PSBR.
§ Lord Harmar-NichollsMy Lords, is my noble friend aware that most people would not wish the Government to be deterred from making these very sensible alterations just because of the legal costs, particularly when the legal costs are in keeping with the general rate that has always applied to business transactions of this kind?
§ Lord BeswickMy Lords, may I take this opportunity to pay a tribute to those of my former colleagues who performed the responsibilities thrust upon them in such a splendidly professional way? Does the noble Earl realise that the figure which he has given is some 10 to 15 times greater than what it cost to bring together the competing companies and to forge them into one on-going and expanding concern? Does he also agree with me that it is a little sad to think that this expenditure did not forward any new research, that it did not buy any new piece of equipment, that it did not produce even one part of one new aircraft? Is this not further proof that it is not those who actually make things who get the biggest reward in the society which we are creating?
The Earl of GowrieMy Lords, I find the noble Lord's logic most curious. There is not the slightest bit of evidence that there will be any less research done by a great British private sector company than by a company which happens to be in the hands of the state sector. In terms of the overall cost, the noble Lord is leaving out of account the cost of capital borrowing and the rest upon the public sector borrowing requirement which would have accrued had British Aerospace remained in the public sector.
Lord MorrisMy Lords, arising out of the question asked by the noble Lord, Lord Beswick, would not my noble friend agree that he has conveniently forgotten the incidence of inflation which was so ably fuelled by the previous Administration?