Royal Ordnance: Plant Closures (Hansard, 2 November 1988)

§ Lord Trefgarne
No, my Lords. The plant closures are a matter for the company.

§ Lord Taylor of Gryfe
My Lords, I am not referring simply to closures of plant. In April last year on the eve of the privatisation his right honourable friend the Secretary of State for Defence said: There is no truth in the rumours that, as a consequence of the sale, two factories will close or that there will be any particular number of redundancies". Is the Minister aware of that? Is he further aware that, within a few months of privatisation and of that statement, 1,100 people in Bishopton in Renfrewshire were declared redundant? Can he explain why that happened when the Minister was prepared to give that assurance on the eve of the sale? Can the 192 Minister also give an answer to the report published in the Sunday Times this week which stated that: The Ministry of Defence sold military patents worth millions of pounds … for a token payment of £1"? Does the Minister agree that these reports have caused great concern to the public and are worthy of some kind of reasonable response from the Minister?

§ Lord Trefgarne
My Lords, in answer to the last of the noble Lord's list of supplementary questions, I agree that certain intellectual property rights were transferred to the Royal Ordnance prior to the privatisation exercise two or three years ago. Needless to say—and I hope it will reassure the noble Lord—the Ministry of Defence retained the right of free use of that intellectual property for its own purposes. Therefore I hope that the concern expressed by the noble Lord has been set on one side. As for the noble Lord's earlier questions, we consistently made clear that whatever rationalisation was required so far as concerns the Royal Ordnance it was a matter for the new owners and not for the Government.

§ Lord Graham of Edmonton
My Lords, does the Minister recall visiting the Royal Small Arms Factory in Enfield before privatisation and giving the workforce an assurance about their future? Now that 2,500 people—the whole workforce—have been made redundant, would he care to return and explain to some of them why in fact he was misled?

§ Lord Trefgarne
My Lords, neither was I misled nor, I hope, did I mislead those whom I met on the occasion to which the noble Lord has referred. As I said in answer to the earlier supplementary question, it was never possible for government Ministers or the Government to give any assurances as to what would or would not happen under the new owners. However, it was clear from the start that some rationalisation would have to take place because at that time Royal Ordnance was far from profitable.

§ Lord Lloyd of Kilgerran
My Lords, will the Minister inform us, either now or later, how much was received by the Government for the patents that were sold? I did not quite gather what the price was.

§ Lord Taylor of Gryfe
My Lords, it was £1.

§ Lord Lloyd of Kilgerran
My Lords, the noble Lord says that it was all for £1. That price seems to me rather remarkable for a number of patents in this age of technology.

§ Lord Trefgarne
My Lords, while it is the case that the intellectual property was transferred to Royal Ordnance for a nominal figure some time before the company was disposed of, as I said in answer to an earlier question, the company was eventually disposed of for £198 million altogether, which of course included the intellectual property.

§ Lord Sefton of Garston
My Lords, the Minister states that the plant closures were a matter for the 193 new owner. However, he was not asked about the plant closures but what he intended to do about the consequences of the plant closures.

§ Lord Trefgarne
My Lords, there are no particular consequences for the Ministry of Defence, except that I hope we shall obtain better value for money from Royal Ordnance.