§ Lord Orr-Ewingasked Her Majesty's Government:
Whether they have determined a new financial target for British Airways.
§ Lord CockfieldYes. In accordance with Section 13 of the British Airways Board Act 1977, I have decided that a reasonable financial duty for British Airways would be to achieve an average annual rate of return in current cost terms of 5¾ per cent. on net assets during the two financial years 1982–1983 and 1983–1984. The current cost profit as the basis for this target would be before taking account of interest and before profits or losses on asset disposals.
I am reinforcing the target by urging the British Airways Board, in conjunction with the target, to use its best endeavours to make progress in eliminating the excess of liabilities over assets in the board's balance sheet as at 31st March 1982.