Mr. Ian MacGregor: Payments for Services (Hansard, 19 December 1984)

§ Lord Beswick
My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

§ The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Lucas of Chilworth)
My Lords, the amounts of the performance payments still to be made to Lazard Frères in respect of Mr. Ian MacGregor's service as chairman of BSC are one of up to £700,000 and one of up to £450,000. The actual amounts of these payments will be determined by a review committee acting in accordance with the agreed criteria, copies of which were placed in the Library of the House on 15th April 1981. The terms of the agreement with Lazard Frères for the release of Mr. MacGregor to serve as chairman of the NCB provided only for an initial payment of £1.5 million and did not include performance-related elements.

§ Lord Beswick
My Lords, I am much obliged to the noble Lord. May I make it absolutely clear that nothing I say is a personal criticism of Mr. MacGregor, but of the fact of the appointment. Is it not a fact that this information shows that the appointment is one 649 completely without precedent in our public life? Was it not absolutely clear to anybody who wished to see that this appointment would lead to inevitable conflict? Now at a time when we have had an expenditure of between £1,000 million and £2,000 million, with all the hardship and misery in the mining communities, with deaths of miners and non-miners, would it not be a good thing to admit that this appointment was a mistake and see whether we can all start afresh?

§ Lord Lucas of Chilworth
My Lords, so far as the noble Lord's first supplementary is concerned, yes, this was a precedent, but Mr. MacGregor was appointed because he was considered to be the best man for the job, and the Government see no reason to alter that view. With regard to his chairmanship of British Steel, when he arrived there was a £667 million loss for the year 1980–81. The preliminary results for that corporation for this first half year show a £27 million profit. That is indeed a success. With regard to the point that the noble Lord makes about this giving rise to conflict, I have to tell him that we do not believe this to be so.

§ Lord Taylor of Gryfe
My Lords, am I right in understanding the Minister to say that the £1.5 million paid to Lazard Freres when Mr. MacGregor took over the chairmanship of the NCB is not related in any sense to performance? May I ask what is the total cost of Mr. MacGregor's services—the transfer fee of £1.5 million, I assume, plus annual salary?

§ Lord Lucas of Chilworth
My Lords, the noble Lord understands correctly. There were no performance requirements in this appointment. The £1.5 million to which I referred was a once-and-for-all payment. I understand that the then Secretary of State for Energy did not consider it appropriate that there should be performance criteria added.

§ Lord Nugent of Guildford
My Lords, is my noble friend aware that the point made by the noble Lord, Lord Beswick, that this appointment is going to lead to inevitable conflict, is not a reflection on the chairman of the National Coal Board, but on the gage which had already been thrown down by the president of the National Union of Mineworkers that he intended to carry out the campaign which he is now carrying out? Does not the very large figure which has to be paid to find a man with the heroic qualities and the necessary calibre to take on this job show that very few men anywhere would have been willing to take on such a heroic task? Should we not in fact be grateful to Mr. MacGregor that he is willing to do so, and is still trying to carry out his duties to manage the Coal Board as Parliament has instructed him to do?

§ Lord Lucas of Chilworth
My Lords, I am most grateful to my noble friend Lord Nugent of Guildford for putting so succintly in a series of questions to me exactly what the position is. This damaging dispute has been sought and provoked by the leadership of the NUM who have imposed their will upon their membership without any ballot. There is no justification whatsoever for the strike. The present chairman of the National Coal Board has supervised 650 one of the very best offers which has ever been made to the industry in terms of wages, jobs, and redundancy, and has in fact presided over the formation of enterprise boards to assist those miners who have wished to leave the industry.

§ Lord Mackie of Benshie
My Lords, is the Minister aware that there are horses for courses? Is he further aware that the whole House realises that Mr. MacGregor, when dealing with reasonable people with the good of the industry and their members at heart, did a lot of practical good in steel, but that in a political situation he is wholly at a loss and the Government made a grave mistake in transferring him from a job where he did well to one where he was absolutely bound to fail?

§ Lord Lucas of Chilworth
My Lords, I cannot agree with the noble Lord in his reading of the situation. The fact of the matter is that the leadership of the National Union of Mineworkers have said—and they are on record as saying—that they have no intention of coming to the negotiating table. Until such time as they do it would be quite wrong to put on the situation the connotation which the noble Lord does in so far as Mr. MacGregor's leadership of that industry is concerned.

§ Lord Blyton
My Lords, is the Minister aware that this is a colossal sum to pay to a man who crucified the steel industry through many, many closures? Is he also aware that this man. Ian MacGregor, has split the mining community in which families are against families, neighbour against neighbour, and that it will take a decade to reconcile the conflict of interest which has been caused by his attitude towards the mining community? Would it not be better for the Government to give him his transfer fee and send him back from whence he came?

§ Lord Lucas of Chilworth
My Lords, I do not accept for one moment that Mr. Ian MacGregor crucified the steel industry. He brought the steel industry into profit, and even in these difficult times the industry is producing all the steel that our home market requires. So far as splitting mining communities is concerned, it is not Mr. MacGregor but their own leadership who have split those communities.

§ Lord Stoddart of Swindon
My Lords, is the noble Lord aware that it is the Government who are responsible—and it is them to blame—in that they appointed Mr. MacGregor, a man who had little experience of the industry? Certainly he had no experience of people in our mining areas and, what is more, he issued a challenge to the coal miners and the coalmining union by setting aside established procedures that had gone on for many years. Would the noble Lord not agree that that was the cause of the strike? Furthermore, would he not agree that even just lately when the TUC were meeting the Secretary of State for Energy, Mr. MacGregor undermined those negotiations on the day that they were taking place?
Finally, would the Minister not agree, that conditions exist at this very moment, if the Government will only climb down off their high horse, for a negotiated settlement? Will he not show the spirit of Christmas by undertaking such negotiations?

§ Lord Lucas of Chilworth
My Lords, on the number of supplementary questions which the noble Lord addressed to me, may I remind him that successive Select Committees in another place have accepted that there had to be a 4 per cent. reduction in coal output. Mr. MacGregor was appointed to bring the industry into long-term future viability. His plans for so doing would have given that opportunity. The miners have had an extraordinary and unprecedented offer, as I have said, in terms of wages, conditions, redundancy, and so on. There has been no challenge whatsoever by Mr. MacGregor to the procedures. The challenge, of course, was through the leadership of the National Union of Mineworkers in that they did not ballot their members before declaring this strike. That was the breach of procedure. There is no truth whatsoever that Mr. MacGregor undermined the potential negotiations which took place on 14th December when the Trades Union Congress met my right honourable friend the Secretary of State for Energy. There is no question either of the Government being on any high horse. The Government remain—

A Noble Lord
Speech!

§ Lord Lucas of Chilworth
My Lords, I am in fact answering four questions. My right honourable friend the Secretary of State remains available to take part in any talks when the leadership of the National Union of Mineworkers come to the table with the realistic prospect of a successful negotiation, and not the total denial which they have shown hitherto.

§ Lord George-Brown
My Lords, is the noble Lord the Minister aware that in 1926 those of us who are old enough to remember went through exactly the same situation? There was no Mr. MacGregor; there was a "Scargill" then called A. J. Cook. Exactly the same problem arose. Is he aware that it took nine months to solve it? Is he aware that it was solved only because the TUC then had a man called Ernest Bevin who was willing to face them down, and did?
Secondly, would the noble Lord the Minister remind the noble Lord, Lord Beswick, there there is nothing wrong in radicals creating precedents? That is why we are radicals. There is nothing wrong—

Noble Lords
Question!

§ Lord George-Brown
My Lords, is the Minister willing to remind the noble Lord, Lord Beswick, that the noble Lord, Lord Beswick, and I were once radicals?

§ Lord Stoddart of Swindon
He still is.

§ Lord George-Brown
We were set upon creating precedents. Finally, is the Minister aware that, whether the MacGregor appointment was right or wrong at the time, whether the terms were right or wrong at the time, our business now is to do as Bevin did in 1926—we have to face Scargill down as Bevin faced Cook down?

§ The Lord President of the Council (Viscount Whitelaw)
My Lords, I am sure the noble Lord will 652 feel that he has had his say to the House. I think that even in this season of goodwill I have to point out to the House, amid some very controversial questions, that it is 38 minutes since we started on Questions and we are much over our time. I gave the noble Lord his chance to have his say. Having had it, I hope that the House will feel we have had enough of Questions for one day.