HC Deb 02 March 1994 vol 238 c739W
Dr. Lynne

To ask the Secretary of State for the Home Department (1) what were the reasons for declining to insert a clause in the sale agreement for the privatisation of DTELS requiring the purchaser not to change staff terms and conditions without their prior agreement;

(2) what consideration he has given to offering staff of DTELS a five-year deal protecting the severance and redundancy terms after the organisation is privatised; and what were the reasons for his decision.

Mr. Charles Wardle

The unions representing DTELS staff requested a Government guarantee for the protection of staff redundancy money in the event that the new owner of DTELS become insolvent. They also asked that the new owner should undertake not to vary staff severance terms without consent and that anyone dismissed for refusing consent would be automatically entitled to redundancy payments.

It is Government policy that there should be a clean break on privatisation. Any argument for special treatment therefore has to be examined on its merits, judged against the perceived risks to the business. In DTELS' case, although it has competitors, it has a strong market position, a reliable and stable customer base and a good record on contract renewal. It was concluded, therefore, that there should be no redundancy money guarantee.

Staff redundancy terms are protected on transfer by the Transfer of Undertakings (Protection of Employment) Regulations. While it was not a condition of sale, shortlisted bidders were asked whether they were prepared to give an undertaking as requested by the unions on any future variation of severance entitlements. The preferred bidder, National Transcommunications Ltd., has confirmed that it will fully meet its TUPE obligations. It has assured us that in the period after sale, subject to its strategy and business needs, it will not be seeking to discuss and agree changes to staff terms. It also accepts that any variation in terms would require negotiation and staff, in respect of which it sought to enforce change, would need to have given consent.