British Steel Corporation

HC Deb 29 January 1976 vol 904 cc337-8W

Mr. Tebbit

asked the Secretary of State for Industry:

(1) what was the rate of return in the last year for which accounts are available on the assets employed in the British Steel Corporation;

(2) what is the estimated target set for the British Steel Corporation expressed as a rate of return on assets employed for the current financial year;

(3) whether he has agreed the corporate plan for the financial years ending in 1976, 1977 and 1978 in respect of the activities of the British Steel Corporation; and, if so, what targets he has set;

(4) what are the latest estimated trading results for the current year for the British Steel Corporation.

Mr. Kaufman

The British Steel Corporation has been set a financial target of making an average annual rate of return of 8 per cent. on net assets over the four-year period from the financial year 1973–74 to the financial year 1976–77. Targets are not set for the individual years within the period. The Corporation made a return—before longterm interest, taxation and extraordinary items—of 8.9 per cent. on its average net assets during its 1974–75 financial year. Following the loss of £125 million announced for the first half of the 1975–76 financial year, the Corporation's deficit for the full year now seems unlikely to be less than £300 million.

My right hon. Friend the Secretary of State discusses BSC's corporate plans with the Corporation but many aspects of these plans do not require his agreement. Approvals have been given relating to BSC's capital investment over the period up to 1978–79. I envisage that in due course there will be a planning agreement between the Government and the Corporation.