HL Deb 27 November 2000 vol 619 cc1212-31

27B Lord Brabazon of Tara rose to move, as an amendment to the Motion that the House do not insist on its Amendment No. 27 to which the Commons have disagreed for their reason numbered 27A, leave out "not".

Lord Brabazon of Tara

My Lords, in moving this amendment, I shall speak also to Amendments Nos. 28B and 29B. The gist of all of these amendments is to say that the House should insist on its amendments that were passed on Report. The Minister made a great deal of the constitutional point. In fact, I heard him say on a radio programme this morning that it was a "constitutional outrage" that we should even consider asking the Commons to take another look at the matter.

As we all know, since the House of Lords Act the relationship between this House and the other place has inevitably been destabilised. The relationship has changed, as composition of the House changed. This was recognised by the noble Baroness the Leader of the House in her now famous doctrine. The noble Baroness declared that this new House would be more legitimate and that it would speak with more authority. She also promised that your Lordships' decision, if taken—as the decision on this issue so far has been—by Peers of, as she put it, a range of political and independent opinions". would carry more weight with the Government. Should the voice of this House not be afforded some weight on this subject, as the noble Baroness promised?

I do not argue, nor do my noble friends, that the Salisbury doctrine has wholly passed its time. The unelected House should not try to block a manifesto item on which the elected majority in another House has insisted. But this is not such an item. We are not seeking to block the implementation of this proposal, but merely to defer it for a few months.

There is nothing in the amendment to prevent the Government going ahead with all the preparation necessary to implement their proposals. All we suggest with these amendments is that the actual transfer schemes be delayed until after the next election so that the proposal can be put into the manifesto and put before the public. As I said on Report, this is exactly what we did with the BT privatisation proposals in 1982. The Minister says that this is not a privatisation but a public/private partnership. But the Bill allows under Clause 48 for the Crown shareholding to drop to 25 per cent. Furthermore, subsection (10) of that clause provides that, The Secretary of State may by order amend or repeal this section". In other words, the whole business could be sold. That sounds to me very similar to the British Telecom privatisation back in the 80s.

We are not taking that action in the teeth of a manifesto commitment widely proclaimed and deeply held. We are taking it in the face of a proposal that was explicitly condemned by the Labour Party before the previous general election, and on the opposition to which many Members of another place were elected. The Government in another place may be entitled to insist on our respecting their manifesto commitments. But are not we in this new and, we are told, more legitimate House, entitled equally to tell the Government that they should wait for a mandate before enacting something completely the reverse of a public promise they have given to the electorate? That is all we are asking tonight: that they should wait a little and ask the public for endorsement of this policy.

I am reminded forcefully of the words of the noble and learned Lord, Lord Simon of Glaisdale, on a recent analogous occasion. He was speaking on the Second Reading of the Criminal Justice (Mode of Trial) (No. 2) Bill in your Lordships' House on 28th September. Your Lordships will recall that in that Bill the Government sought to restrict the right to jury trial—something the Government had flatly opposed before the election. The noble and learned Lord said at col. 987 of Hansard: There is no reason at all, no constitutional convention which bars a vote against this Bill with approval of the amendment tonight". This is not a manifesto commitment; on the contrary, on 27th February 1997 less than two months before the election, the Home Secretary made absolutely plain his opposition to this proposal. It was with his words ringing in its ears that the Labour Party went into the general election.

Equally were not the famous words of Mr Andrew Smith, now Chief Secretary but then Labour's transport spokesman, at the 1996 Labour Party conference, Our air is not for sale", equally ringing in the ears of the electorate in 1997, or the words of Mr Keith Bradley, another shadow transport spokesman, in a letter of 5th February 1997, when he stated, I would like to confirm that the Labour Party are completely opposed to the privatisation of NATS and under a Labour Government they will remain in the public sector"? One cannot get much clearer than that. But was not this proposal also absent from the manifesto and has not this been a reversal of policy on a well publicised issue equally as striking as that on jury trial?

The Minister quotes accurately from what the Leader of his party said in the foreword to the manifesto. So what does one do? One then turns to the relevant pages in the manifesto which deal with transport. And what does one find? Lo and behold it states clearly with regard to London Underground: Labour plans a new public/private partnership to improve the Underground". The manifesto further advocates with regard to buses, partnerships between local councils and bus operators". With regard to roads, the manifesto refers to, using public/private partnerships to improve road maintenance and so on. That is all clear, until one gets to the aviation section of the manifesto which states: The guiding objectives of our aviation strategy will be fair competition, safety and environmental standards". There is not a word in the manifesto about a public/private partnership for National Air Traffic Services. Therefore, I am led to believe that the general public, or at least that part of it that reads manifestos, would be entitled to assume that the famous words, Our air is not for sale", still hold good.

The noble Lord referred to investment and to the letter from the British Air Transport Association which I have seen today. Of course we understand the need of the industry for new investment, but after three and a half years in office why is this suddenly so urgent? Swanwick progresses, whether or not the PPP goes through, and so can the new Scottish centre. Is it not better to have a delay of only a few months to get this PPP the endorsement from the electorate that it needs? Would it be outrageous to suggest that after last week's public finance figures, which showed the public sector net borrowings standing at a surplus of £11 billion, the Treasury might allow NATS the limited freedom to borrow, if only temporarily—the same freedom as the Post Office now has permanently? So, too, do regional airports. Immediate and urgent privatisation is not the policy of these businesses, why should it be necessarily so for NATS?

There is not a shred of justification for the other place bulldozing the voice of this House on this matter. Far from there being a mandate or even there being absence of a mandate, there is the absolute opposite of a mandate. In such a case as this I argue that what I might call the "Simon of Glaisdale doctrine" should apply, just as it did on the proposed restriction of jury trial. Your Lordships not only have the right to ask the Government to seek an honest mandate from the electorate for a policy they previously promised to oppose; some might consider that this House would be in dereliction of its constitutional duty if it did not do so. For all those reasons I believe that another place should have the opportunity to re-examine these amendments. I beg to move.

Moved, as an amendment to the Motion that the House do not insist on their Amendment No. 27 to which the Commons have disagreed for their reason numbered 27A, leave out "not".—(Lord Brabazon of Tara.)

8.30 p.m.

Baroness Thomas of Walliswood

My Lords, I support the amendment in the name of the noble Lord, Lord Brabazon of Tara. First, I want to set out our position as it now stands. During earlier stages of the Bill we on these Benches did our best to persuade the Government to substitute a not-for-profit trust for the PPP option for NATS.

The advantages of going for the option of a not-for-profit trust are clear. The public interest in NATS will be preserved, and a true partnership with stakeholder and employee interests would be assured. The Government would avoid the burden of the required investment falling on the public sector borrowing requirement. The not-for-profit trust would nevertheless be able to borrow at near government rates, thus contributing to a reduction of NATS' costs. The temptation to skimp on safety to satisfy shareholders, to which Gerald Corbett has referred in respect of Railtrack, would be avoided. This would protect the "safety ethos" element identified by many Labour Members in discussions in this House as a major worry with the PPP option.

Lord Dubs

My Lords, I am sure that, like almost everyone else, the noble Baroness will have seen the letter in today's Times from the chairmen of British Airways, British Midland and Virgin in which they stated, If safety was at risk, we would be leading the criticism of the PPP proposal; but it is not"?

Baroness Thomas of Walliswood

My Lords, all those companies have an interest in purchasing their share of NATS, so they would say that, wouldn't they?

The main exemplar of the not-for-profit trust option, NavCanada, has proved capable of stretching its wings to co-operate with Russia in research which it is hoped will lead to non-stop polar routes between North America and South-East Asia. Thus a not-for-profit trust is capable of being entrepreneurial and of expanding its business—a major government ambition for NATS.

Moreover, while we understand that the failure of NATS to control the project at Swanwick and to bring it in on time and at budget is a matter of concern to the Government, as it is to all other Members of this House, it is no argument that the private sector is always better at such management to show that the public sector is sometimes deficient. There have been many prominent scandals when introducing new technology in the private sector as well.

The fact that we are tonight again supporting the Conservative amendment to delay the implementation of a NATS/PPP proposal does not mean that we have abandoned our hope that the Government will change their mind. On the contrary, we hope that the Government will use the opportunity provided by the six-month delay to rethink their project. At present, rumours are rife all over the place that they may try to do just that. Our belief is that the not-for-profits trust was never considered by the Government because they had already committed themselves to the PPP option, perhaps at the behest of the Chancellor. The option deserves serious consideration.

Secondly, we reject suggestions, as did the noble Lord in introducing his amendment, that defeating the Government tonight would be in some sense outrageous or disgraceful. This matter is no game but a matter of great significance where the Government have apparently pitted themselves against their own spokespeople before taking office, against the professionals—pilots and controllers—against the transport Select Committee in the House of Commons, which also endorsed the option for a not-for-profits trust, against large numbers of Labour MPs who are still trying to convince their own Government to change their mind, and against the public who in various polls have shown their opposition to a PPP by majorities ranging from more than 60 per cent to nearly 80 per cent. That level of opposition to the Government's plans is in itself a justification of continued pressure from this House on the Government to change their mind.

Thirdly, I wish to state quite clearly that comments from Ministers suggesting that the Bill might be lost are absurd. The fate of the Bill is in the hands of the Government, not of the Opposition. The Government could accept tonight's amendment. That would secure the passage of the Bill with a delay of about six months in the implementation of Part I. Perhaps, since they claim to be so supportive of the PPP for NATS, Ministers should recommend going to the country at the next election with a PPP for NATS in the manifesto. That would leave the remainder of the Bill unimpaired.

We hope that the Government will concede. Politically speaking, there could hardly be a worse time to be gung-ho for the privatisation of an essential transport aid. We have Railtrack in chaos, and increasing dispute about the PPP for the London Underground. What a time to launch yet another extremely controversial and potentially dangerous scheme upon the public. We hope that even at this late stage the Government will have the courage to change their mind and to get off the hook of dogged devotion to an inappropriate solution for NATS on which they have impaled themselves for too long.

8.45 p.m.

Baroness Jeger

My Lords, as probably the oldest old lady who has ever been chairman of the Labour Party, perhaps I may say that we always believed that we had to put what we had in mind in the manifesto. One of the most unacceptable factors is that this proposal was not in the manifesto. Moreover, we had balloons stating, "Our air is not for sale". Members of trade unions have said that we do not want a Railtrack in the sky. In view of the recent happenings on the railways we should take that on board.

It is necessary to gain acceptance for the policy from the people who work in this area. One of my noble friends referred to a letter in The Times. Anyone can get a letter in The Times; even I have had a letter in The Times. However, another letter suggested that the workers' views were not being taken into consideration. However, I am taking them into consideration in my humble way. I have received many letters, as I am sure others have, which do not come from those fat chaps writing letters to The Times but from members of the trade unions and the pilots and those who support the chaps doing the work. I am so old: I love to remember all that the Battle of Britain meant to us. One of my friends said to me, "You're just still keen on pilots"!

I do not often speak against my own party. But I honestly think that we are wrong. We are being inconsiderate to the pilots and others who undertake this work, and their trade unions. I am disgusted that my party seems to be taking no notice of their opinions because private money is more important.

Baroness Hogg

My Lords, I am very honoured to follow the noble Baroness. This seems to be an evening for friendly fire. I most reluctantly oppose the amendment put forward by my noble friend. My reluctance should be evidenced by the fact that in five years' membership of this House I have never been moved to vote against my friends; and at earlier stages of the Bill I supported these Benches on the issue. But we are up against the buffers now on the Bill and have to consider what is on offer. I believe that with this amendment we are in danger of losing sight of the wood for the trees.

My opposition to the amendment has nothing to do with what seemed to me the utter nonsense uttered this morning by the Minister on constitutional outrage. It is not a constitutioal outrage to be considering voting on the amendment. Frankly, in view of a number of things that the Government have done, I do not think that the Minister would know a constitutional outrage if it hit him on the nose.

I am also getting sick and tired of hearing government Ministers bellyache about the remaining hereditary element in this House. If the Government do not believe that the elected hereditaries who remain in the House have the right to speak and vote on their considered views, they should have had the guts to vote them out of this Chamber. As they have not done so, they should respect the constitutional position. It is an outrage to say that they are not entitled to vote. However, I do not think that we on this side have a constitutional duty to stop the Labour Party changing its mind, particularly if I approve of the direction in which it is going. It is those considered views on which I should like to reflect briefly.

There are elements on both sides of the Chamber who try to pretend that what is being discussed is not privatisation. The opposition to this part of the Bill seems to be coming from two directions. On the one hand, there are those who want less privatisation than is being proposed; and they are trotting out some of the arguments we heard at the very beginning about safety, as though private companies such as chemical plants and airlines throughout the economy were not dealing with safety issues day in and day out. We have also heard about national security, as if we did not have emergency powers to deal with those issues across a wide range of essential services and utilities.

On the other side we hear that this privatisation does not go far enough. That is the point at which the contradictions in the opposition to the Bill begin to lose me. Privatising a natural monopoly in the form of a network, which NATS is, raises all kinds of difficult issues. I have worked on a number of different models in the UK and other countries, although I hasten to assure the House that I have not worked on this model. The issue can be approached in a variety of ways and I do not argue for a moment that the Government have chosen the single, ideal model. I think that the partnership model has some advantages in this situation, but there are other ways to bring in private involvement.

However, what is sticking in my gut—this is my fundamental point—is that the involvement of the private sector has been fought for by the Conservatives for 20 years. We have fought to spread the understanding that the involvement of private enterprise in state activities is a plus. Privatisation, contracting out and public/private partnerships are different manifestations of an idea, put forward by the Conservatives, that has truly changed the world. It is changing economies from south-east Asia to eastern Europe.

Most remarkably, those ideas have even penetrated the understanding of the Labour Party. The Bill is the clearest evidence that, albeit imperfectly, the Labour Party has been converted to the idea. I find the Liberals' continued opposition the clearest possible evidence of their unreconstructed corporatism. I cannot bring myself to support that attitude against the Government. I am not keen to ride on Liberal prejudices just to cause the Government short-term embarrassment. That would not redound to the Conservatives' credit in the long term.

What will happen? We can see that some parts of the Labour Party will be only too glad to be shot of the issue. The Government will tell NATS that they are unable to go forward with their brave and difficult plan because the Tories have turned tail on privatisation. Because it is important to show that some of us have not done so and to avoid NATS being left in limbo with its future uncertain, I find myself, very reluctantly, obliged to oppose my party.

Lord Clinton-Davis

My Lords, I abstained when the issue was first discussed, but I shall vote for the Government tonight. I shall explain why.

The Conservative Party has been less than frank with the House. The real reason why the Conservatives want to delay is to work out what they are going to say about the privatisation of NATS. That is what they want, but they dare not say it, because it is unpopular with the electorate. The noble Lord, Lord Brabazon, has argued that we should delay a few months. What is the likelihood of persuading the air traffic controllers that that is a good idea?

I do not believe that the Government can win on the issue, but I support the rest of the Bill, because I believe in the principles adumbrated in it. However, the Government will not win on NATS unless my noble friend the Minister argues a little more forcefully than he has done tonight. He was unable to tell us the outcome of the discussions between Ministers and the air traffic controllers. He told us that there have been discussions—I am glad about that—but what was the result? The Institution of Professionals, Managers and Specialists—the union represented by my noble friend Lord Brett—had a long discussion on the issue and came out against the semi-privatisation of NATS.

My view, as a former aviation Minister, is that our air traffic control compares with anything in the world. I believe it to be a good system. The onus of proving otherwise falls on my noble friend the Minister. He does not argue that NATS is insufficient, but that it does not have the money, does not have the right sort of money or does not put its money in the right direction. That is not the fault of NATS, but the fault of the Government, as my noble friend well knows. NATS has performed well over the years and there is no reason to interfere with it. The Government can do much better than propose its disestablishment.

However, I am not prepared to lose the rest of the Bill, as the Government have suggested may happen, not only in the House of Commons, but more publicly elsewhere. The Government have a job between now and the election to convince not only the electors, but the air traffic controllers that their plan is right. I do not think that they can do it.

The issues are very important, for the reasons that have already been given in the debate. Time is of the essence and the Government do not have a lot of it on their side. However, I do not want the air traffic controllers to say that the issue should not be proceeded with because the Government do not have time on their side. They should face up to the problem with the Minister fairly and squarely. That they have not so done yet is not their fault, but largely the fault of the Government.

I do not believe that the Liberal Democrats should support the Conservatives tonight. That is what they are going to do. They have no policy. They say that they believe in National Air Traffic Services, so they should support the Bill, albeit reluctantly. I believe it is important that all parties should speak frankly tonight as to where they stand on this issue. I do not believe that the Tories have done that.

It is with a heavy heart that I shall go into the Government Lobby. It is not very important whether I go with a heavy heart or a light heart, but I shall support the Government, not because they have won my support on the issue of NATS but because I believe that the "venue" has changed. The House of Commons has spoken. I take that very seriously indeed. I hope that my noble friend will not be reluctant to speak to the air traffic controllers and put forward his point of view. However, I hope that he will go with his ears open and that he will listen carefully to those who have the day-to-day job of flying and looking after the aeroplanes. That is the burden that rests on my noble friend tonight.

9 p.m.

Lord Smith of Clifton

My Lords, this amendment seeks to delay a wretched piece of proposed legislation which few want. As we heard, 62 per cent of public opinion is opposed to it, as are the airline pilots and the air traffic controllers. Pace the Minister, as has been pointed out by the noble Lord, Lord Brabazon, and others, if there is a constitutional outrage, it is that the Government have no electoral mandate for it. Indeed, quite the reverse is true; they have done a complete U-turn on NATS.

Part-privatisation is neither one thing nor the other. As a corporate beast it is unrecognisable and is most likely to be a mere staging post on the way to complete privatisation. The government scheme for NATS is the most expensive option. On Report I challenged the Minister, the noble Lord, Lord Macdonald, to ask the National Audit Office to make a prior assessment of it, both as regards value for money and safety, as it is doing with London Underground. He evaded that question.

Again, we have been endlessly and repeatedly assured that safety would be, if not paramount, then at least the top priority. The public were given such reassurances after the fatal Southall and Ladbroke Grove rail disasters by Ministers, the privatised Railtrack and the railway operating companies. Then Hatfield happened. Ministers have failed utterly to answer the question of how safety can be maintained alongside severe cost-cutting.

Only yesterday the Observer newspaper revealed: A briefing document prepared by NATS last month says that plans to cut up to £165 million from their budget over the next five years will undermine safety of passengers and mean that 1.8 million flights a year over Britain could descend into chaos". On the previous Sunday, 19th November, the main editorial leaders of both the Observer and the Sunday Times condemned the Government's scheme, with the latter endorsing the NavCanada model of the kind advocated by the Liberal Democrats, the noble Lord, Lord Brett, and his like-minded colleagues on the Labour Benches.

The country is bewildered by the Government's blind intransigence on the future of NATS. That bewilderment was elegantly encapsulated in the Steve Bell cartoon of 17th November in the Guardian. It graphically depicted the Prime Minister, scooped up in the claws of a giant eagle, anxiously telephoning his chief press officer on his mobile, saying: Alastair, remind me why we must privatise air traffic control? Is it logic, principle, financial pressure, or have I taken a bung? Although no one would suggest that the last is the case, few people, if any, can fathom the Government's motivation behind their irrationally obsessive determination to create what the noble Baroness, Lady Jeger, called "a Railtrack of the air".

The proposals should be deferred until the Government include them in their election manifesto next time or, preferably, when they have had second thoughts and have come up with a better and more credible option along NavCanada lines.

Lord Stoddart of Swindon

My Lords, when this matter was last debated and voted upon, I voted against the Government. I voted for this amendment and I intend to do so this evening as well. Indeed, if I needed any convincing to do so, my noble friend Lord Clinton-Davis provided the very arguments which I needed to re-establish my faith in my own decision when the issue was last discussed.

It is no good to say, as has been said on the Front Bench by my noble friend Lord Macdonald, that this is a constitutional outrage. The noble Baroness, Lady Hogg, dealt with that at some length, but I wish to add something myself. The fact is that this House of Lords is the creation of the present Government. Its constitution depended on government decision and House of Commons votes, supported by votes in this House. Therefore, it is a government creation. Make no mistake about that.

I well remember hearing my noble friend the Leader of the House when she was challenged by the Opposition that this House would be a rubber stamp. She refused to accept that, saying that it was not intended to be a rubber stamp; it was intended to be a significant House which would bring the Government to account. Indeed, she asked how it could be a rubber stamp with people such as the noble Lords, Lord Stoddart and Lord Bruce, in the House. Tonight I shall prove that my noble friend was absolutely right, and that while we have people such as myself, Lord Bruce and others—many others, I hope—this House will not be a rubber stamp; it will give proper advice to the House of Commons.

At this point it is strange to ask Labour Members of this House to do the exact opposite of what we were told we should do before the election. Some of us have brains. We shall not simply be told one minute that something is wrong and the next minute that it is right and that we must have a completely different mindset. It may be that others are prepared to do that but I am afraid that I am not and particularly at this time, because we have seen the shambles that Railtrack is in as a result of privatisation. I do not want the same shambles to follow as regards air traffic control.

It has been said that the airlines are in favour of this measure. Of course they are; it will suit them. But what about the pilots? They are the people who must fly the planes and have confidence in the air control system. They are dead against this piece of legislation and we should listen to them.

Therefore, with great regret, I must tell my noble friends that I shall be voting for this amendment this evening. My noble friends are laughing. But I can remember a Labour Party which was in favour of public ownership because it was necessary for matters which affected the whole of the population; because it was necessary for the safety of people; and because, as in this case, public ownership was a strategic necessity. So it is no good my noble friends laughing at me. I have been in the Labour Party for 54 years. I joined it because I believed that public ownership had a place in our economy, particularly where public safety was involved and where a great service was involved.

My noble friends can laugh if they want to. But I repeat that it is with great regret that I shall go into the Lobby against the Government. I hope that the delay will persuade them that they should bring forward different proposals for the retention of NATS in public ownership.

Baroness O'Cathain

My Lords, I wish to declare an interest. I am a director of British Airways plc and a member of the British Airways Board Safety Committee. That close involvement with many aspects of the operation of air traffic control has resulted in my following a self-denying ordinance so far throughout the passage of the Bill. However, I have become increasingly concerned that a distinct pressure has been applied by those who do not wish the partial privatisation of NATS, and the various companies which have expressed an interest in being involved in the process have been barred from lobbying. That rule has not been imposed on the opponents. The opponents, orchestrated by the noble Lord, Lord Brett, the former general-secretary of IPMS, the union of air traffic controllers, if the report in the Guardian of 23rd November is correct, seem to have had it all their own way.

In the circumstances, I feel compelled to state some facts clearly to make sure that the arguments are fairly balanced. I must emphasise that I am not speaking as a supporter of any consortium interested in becoming the 49 per cent shareholder but solely from my experience of the sector, going back some 40 years from my first job as a very junior airline economist.

Like my noble friend Lady Hogg, it gives me no pleasure to be in a position of speaking against my party on this issue. It will be a most uncomfortable experience for me to vote against my party's amendment. But in my view the House of Lords must do what it thinks is best in the interests of the best quality of legislation for the country. I believe that the partial privatisation of NATS falls into that category. My sole aim in taking part in the debate is to do all I can to achieve the objective that the partial privatisation of NATS is not derailed by political shenanigans. It is far too important for that.

The noble Lord, Lord Stoddart, was very forceful in his comments about his party changing its mind. I agree. Although I shall vote in a different Lobby from him, I find it extremely difficult to accept that my party has changed its mind.

The current situation of NATS is that it must take its place in line for Treasury funding long behind, one suspects, education, education, education and the National Health Service. That really is not good enough. Although the air traffic control system has served us well and has caused no anxiety in the minds of the general public, there is a crying need for significant investment. It is imperative that access to capital is free from PSBR constraints. Investment is urgently needed.

I gently remind your Lordships of what happened on 17th June this year. There was a catastrophic failure of the air traffic control system which left thousands of passengers stranded and delayed and having to spend nights at hotels near the airports. Indeed, it cost British business many millions of pounds in total.

Are we convinced that even if the Government did give NATS the investment needed, such expenditure would be subject to effective programme management and robust corporate discipline? I do not intend to make a cheap point about the startling record of mismanagement of large systems-focused projects in the public sector, tempting though that may be. However, it is appropriate in this debate to mention just one word—Swanwick. That is a project which, if completed and up and running by the revised date of 2002, will be a full six years late. By now we should have had the latest in computer systems and a state-of-the-art control centre. Not only is it not yet on stream, but the revised system specification is less advanced than that promised when the project was first drawn up. Between now and the year 2002 shall we be in danger of yet another collapse like the 17th June collapse or indeed, heaven forbid, many more collapses like the 17th June collapse?

There has been an amount of irresponsible scaremongering about the threat to safety resulting from the proposed public-private partnership. That really is what one would call colloquially a "no brainer". One has only to look at the huge emphasis upon safety which is the number one objective of the airlines. Membership of the British Airways Safety Committee for the past seven years has left me in no doubt of that fact. NATS does not have the sole monopoly on safety, but because of the lack of investment and mismanagement of what investment there is, one wonders whether a continuation of NATS in its present form is the best way of ensuring that safety comes first, second and third.

Business people recognise another point as essential; namely, the separation of regulation from the service provision. Business people rail against regulation and are strident in their calls for the abolition of regulation, but in something as fundamental as the safety of millions—I do not exaggerate—I believe that it is imperative that there should be such separation. From an organisational position, I would much prefer to see those functions separated and run by totally different bodies.

I hope that my contribution will take some of the heat out of this stupid situation that we seem to be in. We need the safest, the most efficient air traffic control organisation possible and I firmly believe that the proposals put forward in the Bill are currently the best way of achieving that. Believing that, I can see absolutely no validity in the demand for delay in achieving the public-private partnership. I am sure that I am not alone in believing that, if we delay it, it will never happen. That would be in nobody's interest; it would not be in the interest of the country nor of the Government nor of all those involved in air transport, be they employees or travellers.

9.15 p.m.

Lord Trefgarne

My Lords, I am not opposed to privatisation, but the blatant fact is that this Bill is not privatisation; it is partial privatisation, as my noble friend Lady O'Cathain has acknowledged. I believe it is less than that. It is a public-private partnership and it is a scheme to enable the Chancellor of the Exchequer to balance his books.

I accept that moving the National Air Traffic Service into the private sector has no bearing on safety. I am certain that private sector operators will be equally capable of running a safe air traffic system. The problem is that this is a botched privatisation and a rushed privatisation. At earlier stages of this Bill I raised some of the admittedly minor difficulties about which I had been concerned relating to access to air space by non-public transport users. The noble Lord and I have been in correspondence on that matter.

The plain fact is that this is a botched proposal that ought to be delayed. I am not opposed to privatisation. I believe that in the fullness of time the National Air Traffic Service can be, will be and should be privatised. Indeed, at the moment, running as it does in the private sector, it is running short of money for investment, which is abundantly obvious.

My noble friend Lady O'Cathain referred to the problems at Swanwick. They are not caused by the fact that NATS is still in the public sector. The Swanwick programme is being run by a large American company that has not succeeded in fulfilling its contractual obligations. No doubt there are great difficulties, but they have not been caused by NATS being in the public sector; they are the result of the failure of the contractor to deliver.

Baroness O'Cathain

My Lords, I did say that project management and robust corporate structures were important in the management of such projects and that is why Swanwick has not been properly managed.

Lord Trefgarne

My Lords, Swanwick may or may not have been well managed as far as NATS is concerned, but the plain fact is that the contractor has failed to deliver the technology required in the timescale that was set. Sadly, my noble friend said that it was six years late. The failures of the Swanwick programme are as a result of the failures of the contractor and not the failures of NATS.

When I was a junior Minister at the Ministry of Defence I had some experience of managing large, highly technical programmes from a government point of view. In those days, as now, the problems were very much with the contractors, and with the relationship between the contractors and the National Air Traffic Service. Moving NATS into the private sector will not wave a magic wand over Swanwick or Prestwick when it comes to pass in a little while.

My noble friend Lord Brabazon is right to suggest that there should be a delay in this programme. I have nothing to say about the views of members of the Labour Party or what the Labour Party said before it came into office. For practical reasons we should agree to the amendment proposed by my noble friend. I am not opposed to privatisation. I am not opposed to the thrust of what is contained in the Bill and I support the separation of the regulation of NATS from the operation of the system itself. My noble friend's amendment will enable this programme to be moved forward in a more responsible and effective manner and I hope that the House will agree.

Lord Young of Dartington

My Lords, I support my two noble friends Lord Stoddart and my older noble friend Lady Jeger, who spoke against this amendment.

The public sector borrowing requirement was mentioned. It is certainly a vital matter. Many of those who have studied the history of public ownership in the past 50 years believe that it is the way in which the public sector borrowing requirement was applied, giving the Government the iron hand over publicly-owned industries, which was partly responsible for their not living up to the hopes we had in them.

A vital service like air traffic control should not depend on those considerations if extra investment is necessary to enable the service to continue as efficiently as in the past and to guard against the dangers of the terrible accidents that could occur if that efficiency is put at risk. Safety is the prime case for public investment. The Treasury should not wield the tired old argument about the PSBR. It should not be the case that the efficiency of this vital service is held back and the need for private capital so strongly asserted when it is not necessary for that argument to be put forward.

When we consider this question, we must keep safety in our minds. There was always a strong argument for public ownership when a natural or created monopoly arose. Another argument was when safety was involved. I remember that when I had the privilege of inscribing the nationalisation of the coal industry into the 1945 manifesto, a good deal was made of the need for safety in the mines. It was argued that safety in the mines had been put at risk partly because profit was such an important consideration for the owners of the coalmines. Where has that tradition gone? Why have those arguments for the moment been scuppered?

Safety is the main reason why many of those who are of the same mind as myself want to go along this road. It has of course been brought to our attention by the sad disasters that have occurred recently.

If this Bill is passed in the form proposed by the Government and, shortly before the next general election, an air disaster occurred over this country, whether or not it had anything to do with air traffic controllers, it would be a tragedy for the people directly involved, about which the whole country would be extremely distressed. The Government may also find themselves particularly distressed, because it would yet again be pointed out, as in the case of Railtrack, that such a disaster—for example, over Heathrow—could be attributed in part to a decision to add to the woes of the air traffic control system, which is already in some degree of chaos, waiting for the new day to dawn. If responsibility for such a dreadful crash was attributed to the Government, they would feel very sad that they had taken part. Many other people would feel sad for personal reasons, but it would have a political impact.

I beg the Government to consider the tradition that lies behind the kind of opposition from three of us on this side of the House and agree, to the maximum possible extent, with the plea that has been made by those who on this occasion disagree with the proposal.

Lord Oakeshott of Seagrove Bay

My Lords, I have two points to make. The first is financial. With some trepidation, I disagree with the two accomplished lady economists who have spoken from the Conservative Benches in support of the Government. I am particularly nervous about disagreeing with the noble Baroness, Lady Hogg, since we learned our economics at the same time and at the same university. However, I invite both of them to return to basic economics.

Air traffic control is a licence to print money. It is the classic case of a natural monopoly. Volumes rise steadily, year in, year out; the charges are a tiny fraction of the total cost of air travel. The revenue is therefore rock solid. If a not-for-profit trust were established, I have not the slightest doubt that our pension funds and insurance companies would be queuing up to lend money, through long-term bonds secured on those revenues, at very fine interest rates. If, as the noble Lord, Lord Young, put it, the Treasury loosened its grip, and if the Government lost their obsession with privatisation, there would be no problem about funding the investment NATS needs.

Nor is there any need to confuse privatisation with good management; Railtrack surely proves that. Why on earth should a privatised Airtrack, as I suggest we call it, do any better? A not-for-profit trust based on the Canadian model, free of the dead hand of the Treasury, with proper, secure, long term funding, would be well able to recruit the people with the skills that it needs, both at board and project management level. That is the financial point.

My second point, as a relatively new Member of this House, is about the rights of the House and the constitutional implications of pressing this amendment. Last night on the BBC, I heard the Leader of the House of Commons, at her most gracious, telling us that the House of Lords could invite the Government to think again about a Bill, but that if our invitation to reconsider it were declined, it would be quite wrong for us to continue to oppose it, whether or not it was in the election manifesto. I listened very carefully to the noble Lord, Lord Macdonald, reading out the so-called manifesto commitment. Possibly John Prescott at his finest may be able to make that sound like a manifesto commitment, but the noble Lord certainly did not. I am relatively new to this House and I have not previously heard the Beckett doctrine, but it seems to me that it would turn this House into very little more than a glorified focus group.

This morning we heard the noble Lord, the Minister of Transport, accuse the opponents of the Bill of complete cynical opportunism—that was just a warm up—and we then heard what a constitutional outrage it would be if we were to pass this amendment from what he called, this deeply unrepresentative institution, with 70 per cent of the Lords against us". Noble Lords opposite might bear in mind that the votes cast for the three main political parties at the previous general election are more fairly reflected in the party strengths in this House than they are in the House of Commons. But if Ministers think that this House is deeply unrepresentative, they have no one to blame but themselves. We on these Benches accept no lectures on our rights or composition from a Government moving on to stage two reform with all the speed of a snail stuck in the long grass.

We on these Benches invite the Government to think again—and again, and again, if they have to—about this idiotic privatisation. We shall be happy to repeat the invitation as often as is necessary.

9.30 p.m.

Lord Peston

My Lords, I am loath to rise but I am concerned about the constitutional question. The House as it voted a week or so ago was doing its job correctly in asking the Government to think again. It voted in that way. I believe that the arguments are well balanced and I do not regard anyone arguing either way as being unreasonable or unethical, or betraying anything on this matter. When my noble friend Lord Stoddart was a member of the Nationalised Industries Select Committee and I was its expert adviser we were committed on issues of nationalisation. I can be persuaded as easily by his arguments as I can by the arguments the other way.

However, I am concerned about one issue. I believe that your Lordships' House, in asking the Government to think again, is doing the right thing and is not being a rubber stamp. I regard it as ridiculous, if I may use a strong word, to talk about the issue as though it were the kind of last-ditch issue on which we must ask the Government to think again and again and again.

We asked the Government to think again and the House of Commons duly said, "No". What reasonable person would then say, "We would like you to think yet again and if necessary again and again"? I am totally devoted to this House and believe that it should not be a rubber-stamp House. However, once it has voted and returned the matter to the other place, and the other place has sent it back to us, then, unless the matter is of such depth as to threaten the whole future of the nation, I believe that we ought to accept the view of the other place.

Lord Macdonald of Tradeston

My Lords, much as I regret the attempt by noble Lords opposite to insist on their amendments, we have had a robust debate on the issues raised. I am grateful for the many and varied contributions. We have ensured that these important matters have once again been fully aired. I listened most carefully. Following such a debate, noble Lords cannot fail to be aware of the importance of the proposition before us.

I am sure that it will come as no surprise to your Lordships that the Government continue strongly to believe that the House should not insist on the amendments. As regards the substance of the Bill, I have already set out in detail the effect which delaying the PPP might have on a number of the parties involved and I want to repeat the arguments. However, let this House be in no doubt that the effect of the amendments would be harmful to NATS, to the airlines, to the passengers and to the country as a whole. We should not forget in particular the needs of the NATS staff, who for a long time have lived in a state of uncertainty about the future. I do not believe that it will do any good to prolong the uncertainty. Noble Lords should be aware that further delays to infrastructure investment, which NATS needs so badly, will cause considerable difficulties, especially as regards the delivery of the vital two-centre strategy.

I return to the constitutional issue. As I said earlier, this House prides itself on being a Chamber which strives to refine and improve the quality of the legislation put before us. However, I do not believe that its remit extends to the introduction of provisions which specifically seek to delay the implementation of government policy, particularly when, as I have demonstrated, full consideration has been given to our proposals. Our adversarial political system produces good democracy, a parliamentary democracy which is still the envy of the world. It does so because we set limits beyond which opposition is not pressed.

We have very full debates and listen to each other; we modify our legislation in the light of what is said, and what emerges is better legislation. But, ultimately, the democratically elected majority in another place should not be prevented from carrying through its policies, whichever government are in power. I hope that noble Lords opposite will, even at this late stage, consider the ramifications of insisting on these amendments. I urge noble Lords not to insist on the amendments.

Lord Brabazon of Tara

My Lords, I am grateful—I believe—to all noble Lords who have taken part in the debate. I cannot possibly deal with every point made by each noble Lord. I particularly enjoyed the speech of the noble Baroness, Lady Jeger. We have not heard much from the noble Baroness recently and it is always a pleasure to listen to her contributions.

Much has been said, not least by the Minister, about the constitutional aspect. From what I have heard, in particular the contributions of my noble friends Lady Hogg and Lady O'Cathain, I am convinced that as far as concerns the constitutional issue we are on safe ground. There is no question that if this amendment is agreed the Bill, or even Part I, will be lost, as some noble Lords suggest. All the amendment does is to ask the Government to postpone the implementation of the transfer until after the next general election when, if they are returned to power, they have a mandate for it.

It has been said that the House of Commons has spoken. It has spoken twice, with the second largest rebellion on the Labour Benches this Parliament. The Select Committee of the House of Commons which considered this matter said that in its view the current proposal for a PPP for NATS was the worst of all possible options for the future structure of the company. I listen to that as well as the response of the Minister.

The Minister said that NATS staff did not wish the uncertainty to be prolonged. All the information that I have received from the union which represents NATS staff is that they are wholly opposed to these measures. Therefore, I am not sure that the Minister is correct in saying that the staff want the uncertainty stopped.

We have had a good debate on the issue and the time has now come to take the opinion of the House.

9.38 p.m.

On Question, Whether Amendment No. 27B, as an amendment to the Motion that the House do not insist on their Amendment No. 27 to which the Commons have disagreed for their reason numbered 27A, to leave out "not" be agreed to?

Their Lordships divided: Contents, 132; Not-Contents, 125.

Division No. 5
Addington, L. Harris of Greenwich, L.
Ampthill, L. Harris of Richmond, B.
Anelay of St Johns, B. Henley, L. [Teller]
Arran, E. Higgins, L.
Astor, V. Hodgson of Astley Abbotts, L.
Astor of Hever, L. Hooper, B.
Attlee, E. Hooson, L.
Avebury, L. Howe, E.
Barber, L. Howell of Guildford, L.
Barker, B. Hunt of Wirral, L.
Bell, L. Hutchinson of Lullington, L.
Belstead, L. Jacobs, L.
Blatch, B. James of Holland Park, B.
Brabazon of Tara, L. Jeger, B.
Bradshaw, L. Kingsland, L.
Bridgeman, V. Linklater of Butterstone, B.
Brougham and Vaux, L. Liverpool, E.
Burnham, L. [Teller] Lucas, L,
Byford, B. Luke, L.
Campbell of Alloway, L. McColl of Dulwich, L.
Carlile of Berriew, L. Mackay of Ardbrecknish, L.
Chadlington, L. McNally, L.
Clement-Jones, L. Maddock, B.
Cope of Berkeley, L. Mar and Kellie, E.
Craig of Radley, L. Methuen, L.
Craigavon, V. Miller of Chilthorne Domer, B.
Crathorne, L. Miller of Hendon, B.
Crickhowell, L. Monro of Langholm, L.
Denham, L. Montrose, D.
Dholakia, L. Mowbray and Stourton, L.
Dixon-Smith, L. Murton of Lindisfarne, L.
Dundee, E. Naseby, L.
Eden of Winton, L. Neill of Bladen, L.
Elliott of Morpeth, L. Newby, L.
Elton, L. Northbrook, L.
Ezra, L. Northesk, E.
Falkland, V. Northover, B.
Feldman, L. Norton of Louth, L.
Ferrers, E. Oakeshott of Seagrove Bay, L.
Fookes, B. Onslow, E.
Forsyth of Drumlean, L. Oppenheim-Barnes, B.
Gardner of Parkes, B. Park of Monmouth, B.
Geddes, L. Phillips of Sudbury, L.
Goodhart, L. Rawlings, B.
Greaves, L. Redesdale, L.
Green way, L. Rees-Mogg, L.
Griffiths of Fforestfach, L. Rennard, L.
Hamwee, B. Renton, L.
Hanham, B. Roberts of Conwy, L.
Rodgers of Quarry Bank, L. Taverne, L.
Roper, L. Taylor of Warwick, L.
Rotherwick, L. Tebbit, L.
Russell, E. Thatcher, B.
Saatchi, L. Thomas of Gresford, L.
Sandberg, L. Thomas of Walliswood, B.
Scott of Needham Market, B. Thomson of Monifieth, L.
Seccombe, B. Tope, L.
Selkirk of Douglas, L. Tordoff, L.
Sharman, L. Trefgarne, L.
Sharp of Guildford, B. Waddington, L.
Sharples, B. Walmsley, B.
Shaw of Northstead, L. Watson of Richmond, L.
Shutt of Greetland, L. Wigoder, L.
Smith of Clifton, L. Williams of Crosby, B.
Stoddart of Swindon, L. Young, B.
Strathclyde, L. Young of Dartington, L.
Acton, L. Hayman, B.
Ahmed, L. Hilton of Eggardon, B.
Alli, L. Hogg, B.
Amos, B. Hogg of Cumbernauld, L.
Andrews, B. Hollis of Heigham, B.
Archer of Sandwell, L. Howells of St. Davids, B.
Ashley of Stoke, L. Howie of Troon, L.
Ashton of Upholland, B. Hoyle, L.
Bach, L. Hughes of Woodside, L.
Barnett, L. Hunt of Chesterton, L.
Bassam of Brighton, L. Hunt of Kings Heath, L.
Berkeley, L. Irvine of Lairg, L. (Lord Chancellor)
Bernstein of Craigweil, L.
Billingham, B. Jay of Paddington, B. {Lord Privy Seal)
Blackstone, B.
Borrie, L. Jordan, L.
Bragg, L. King of West Bromwich, L.
Brennan, L. Kirkhill, L.
Brett, L. Layard, L.
Brooke of Alverthorpe, L. Lea of Crondall, L.
Burlison, L. Lichfield, Bp.
Carter, L. [Teller] Lipsey, L.
Chandos, V. Lockwood, B.
Clarke of Hampstead, L. Macdonald of Tradeston, L.
Clinton-Davis, L. McIntosh of Haringey. L. [Teller]
Cocks of Hartcliffe, L.
Cohen of Pimlico, B. McIntosh of Hudnall, B.
Crawley, B. MacKenzie of Culkein, L.
David, B. Mackenzie of Framwellgate, L.
Davies of Coity, L. Marsh, L.
Davies of Oldham, L. Marshall of Knightsbridge, L.
Dean of Thornton-le-Fylde, B. Massey of Darwen, B.
Desai, L. Merlyn-Rees, L.
Donoughue, L. Mitchell, L.
Dubs, L. Morgan, L.
Elder, L. Morris of Castle Morris, L.
Falconer of Thoroton, L. Nicol, B.
Farrington of Ribbleton, B. O'Cathain, B.
Faulkner of Worcester, L. Peston, L.
Filkin, L. Plant of Highfield, L.
Fyfe of Fairfield, L. Ponsonby of Shulbrede, L.
Gale, B. Prys-Davies, L.
Gibson of Market Rasen, B. Puttnam, L.
Gladwin of Clee, L. Ramsay of Cartvale, B.
Goldsmith, L. Randall of St. Budeaux, L.
Gordon of Strathblane, L. Rendell of Babergh, B.
Goudie, B. Richard, L.
Gould of Potternewton, B. Richardson of Calow, B.
Grabiner, L. Sainsbury of Turville, L.
Graham of Edmonton, L. Sawyer, L.
Greengross, B. Scotland of Asthal, B.
Grenfell, L. Sewel, L.
Hardy of Wath, L. Shepherd, L.
Harris of Haringey, L. Sheppard of Liverpool, L.
Harrison, L. Simon, V.
Haskel, L. Smith of Leigh, L.
Stone of Blackheath, L. Warner, L.
Strabolgi, L. Warwick of Undercliffe, B.
Strange, B. Whitaker, B.
Symons of Vernham Dean, B. Whitty, L.
Thornton, B. Wilkins, B.
Tomlinson, L. Williams of Mostyn, L.
Turnberg, L. Winston, L.
Varley, L. Woolmer of Leeds, L.

Resolved in the affirmative, and Amendment No. 27B agreed to accordingly.

9.48 p.m.