HL Deb 07 December 1987 vol 491 cc3-4

2.42 p.m.

Lord Dean of Beswick

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

The Question was as follows:

To ask Her Majesty's Government whether they will place in the Library copies of the cost-benefit analyses of the possible privatisation of the Crown Suppliers and implementation of the Dewi Jones Report.

The Minister of State, Department of the Environment (Lord Belstead)

My Lords, neither the report by Coopers and Lybrand assessing the feasibility of privatisation nor the Dewi Jones Report on other efficiency measures have been published. Copies of a summary of the two reports prepared by the Controller of the Crown Suppliers and circulated to all staff and the trade unions concerned have been placed in the Library.

Lord Dean of Beswick

My Lords, I am grateful to the Minister for that reply. He must be aware that the people involved, including the staff, are deeply disturbed at the way this issue is being dragged out.

Is the Minister aware of the recent report that indicates that the procurement itself had a return of 7 per cent., which is 2 per cent. above the guidelines of the Government, on its established assets? Bearing in mind its success as a financial organisation, why do the Government still have doubts about whether to keep it in being in the interests of taxpayers as a whole?

Lord Belstead

My Lords, I agree with the noble Lord that the Crown Suppliers has met its financial targets and has generally performed satisfactorily. However, the Government feel that as the Crown Suppliers operates as a trading fund it is possible that it could be run more appropriately in the private sector.

As departments are increasingly free to purchase goods and services elsewhere, the Crown Suppliers is expected to compete for work in the public sector. Yet generally speaking it cannot seek business outside it as it would if it was a private concern. I think that is a persuasive reason for considering privatisation.

Lord Graham of Edmonton

My Lords, has the Minister seen the report in a newspaper this morning that at a recent meeting with the employees, his ministerial colleague, Mr. Chope, said that the board of Crown Suppliers was a trade union acolyte for refusing to accept the idea of a management buy-out? Does he consider that such language is conducive to a good relationship with employees? Surely in the light of the successful profit return of the employees the Minister and his colleagues ought to be encouraging them and not discouraging them by using language of that kind.

Lord Belstead

My Lords, I have not seen the newspaper report to which the noble Lord refers. It is, however, a fact that my honourable friend the Parliamentary Under-Secretary for State met staff and union representatives last week and is now considering all the available information in order to reach a decision at the earliest possible date. I believe that that is an attempt to be helpful.

Lord Diamond

My Lords, is the Minister aware that the practice he has adopted of giving a reason for privatisation is most welcome; and will he bear that in mind on future occasions?

Lord Belstead

My Lords, I am most grateful to the noble Lord.

Lord Dean of Beswick

My Lords, will the Minister comment on the reports that there is now a serious difference of opinion between the Treasury and the Department of the Environment? I understand that the Treasury, through Mr. Major, has indicated that it desires to keep this operation public, bearing in mind the collapse of share prices and that it might not realise its true value if sold off now.

Lord Belstead

My Lords, as I said, we are considering the matter. My honourable friend the Parliamentary Under-Secretary has seen the staff side, and I ought not say more on this matter today.