HL Deb 27 January 1993 vol 541 cc1259-61

2.44 p.m.

Lord Clinton-Davis asked Her Majesty's Government:

Whether they have undertaken any consultations with the board of directors of British Airways concerning the effects on British aviation interests generally of the campaign waged against Virgin Atlantic.

The Earl of Caithness

My Lords, no.

Lord Clinton-Davis

My Lords, is that not a surprising Answer? Will the Minister at the very least agree that the behaviour of British Airways in this case was utterly unconscionable? Does he agree that it is in the interests of British aviation that the reputation of the world's finest airline needs to be repaired without delay? Have not the Government an interest in the matter?

The Earl of Caithness

My Lords, the reply to the noble Lord's first supplementary question is again "No". We have a different philosophy from him. I understand that he likes to interfere with every business, whether successful or not. But this is a matter between two private companies.

Lord Astor of Hever

My Lords, does my noble friend agree that we should compliment the board of British Airways on creating an airline which is the envy of the world? Should we not deplore Mr. Branson's continuing threats of US litigation, which will benefit foreign airlines?

The Earl of Caithness

My Lords, we should certainly compliment British aviation, not just the two airlines that my noble friend mentioned. However, it is sad that when there is so much competition from across the Atlantic our two prime airlines which cover that route are arguing among themselves. The sooner that stops and we get on with competing with the Americans the better.

Lord Jenkins of Putney

My Lords, is the noble Earl aware that if British Airways intends to keep its claim to pre-eminence and successfully to handle competition it must stop packing people in like sardines on its long distance jumbos, particularly in economy class? People are not sardines but at the end of a long flight in economy class on British Airways they feel just like sardines.

The Earl of Caithness

My Lords, I am sure that the noble Lord would like to take up his complaint direct with British Airways.

Lord Bruce of Donington

My Lords, the noble Earl may not yet have had the opportunity of studying the recent court proceedings involving British Airways and Virgin Atlantic. These matters require consideration. But does he agree that on the basis of the press reports which have so far appeared there is a case for the Government to interest themselves in the way in which the whole business has been conducted? It would be in the interests of the general public and the reputation of the country as a whole to make representations to British Airways, which is clearly culpable in the events that have taken place.

The Earl of Caithness

My Lords, we must be careful—I know that the noble Lord will agree with me on this—about acting upon what is said in the press. One must look at the facts of the case. It was a libel case. But at the same time it is a matter between two private companies and they must sort it out themselves.

Lord Marsh

My Lords, does the Minister agree that British Airways generally has improved enormously since Ministers ceased to intervene with it?

The Earl of Caithness

My Lords, I could not agree more with the noble Lord.

Lord Mackie of Benshie

My Lords, will the Minister not even say that in general he disapproves of the kind of conduct of which a major British company has been accused?

The Earl of Caithness

My Lords, one must look at the particular case. If there is justification for action to be taken, it must be taken by the appropriate company in the circumstances.

Lord Ashley of Stoke

My Lords, the Minister said that my noble friend wished to interfere in everything. Could he provide a little evidence to show that that allegation was not wholly irresponsible?

The Earl of Caithness

My Lords, one has only to look at the Labour Party's manifesto at the last election to see what it would have done and, indeed, at the recent announcement proposing to put a supertax on a number of successful British companies.

Lord Stoddart of Swindon

My Lords, will the noble Earl give chapter and verse as to where in the manifesto we say, or the Labour Party says, it will intervene, directly or indirectly, in British Airways?

The Earl of Caithness

My Lords, I referred to the manifesto in general, as the noble Lord knows full well. It is a difference of philosophy between the two sides of the House.

Lord Clinton-Davis

My Lords, is it not clear that the Minister was, in the most misguided way, thinking on his feet and made a totally unfounded allegation? There is nothing in the manifesto on that at all. Does he understand that there has been revealed in British Airways' own statement an admission of the most appallingly illicit behaviour? Do the Government appreciate that there is a case for Ministers saying to the chairman of British Airways and to senior management, "This is not good enough. It damages the reputation of British Airways and British aviation generally and we shall not allow it to happen again"?

The Earl of Caithness

My Lords, if a company has been aggrieved by another company there are the usual remedies to go through, and that must happen.