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House of Commons
Friday 7 June 1991
The House met at half-past Nine o'clock
PRAYERS
[Mr. Speaker-- in the Chair ]
Nationalisation
Motion made, and Question proposed, That this House do now adjourn.-- [Mr. Sackville.]
Mr. Speaker : This morning's debate is on nationalisation, denationalisation and renationalisation--
Mr. Roger King (Birmingham, Northfield) : On a point of order, Mr. Speaker.
Mr. King : No, not on that but, with your indulgence, I should like to raise a point of order about the Official Report which, as you know, is the guardian of the spoken word in the House. I refer you to column 403 of yesterday's edition, which contains an exchange of views between her Majesty's Leader of the Opposition and the Prime Minister.
When making his point about interest rates charges as they affect small businesses, the Leader of the Opposition stated :
"Small businesses which used to have arrangements to pay 3 per cent. above base rate on their overdraft facilities are now paying as much as 17 per cent.--[ Official Report, 6 June 1991 ; Vol. 192, c. 403.]
There was then an interruption, of which I was a part, which was an expression of incredulity about the fact that base rates for some businesses could be the base rate plus 17 per cent. which is what we understood the Leader of the Opposition saying. He was making a highly ambiguous statement. If you read on a little further, Mr. Speaker, you will see that my right hon. Friend the Prime Minister also believed that the Leader of the Opposition was saying that the lending rate for small businesses was the base rate plus 17 per cent., because he expressed astonishment and frank disbelief at those allegations.
The Leader of the Opposition has since gone public and has written a letter to the Prime Minister, which is well reported in today's press, expressing his concern about the Prime Minister's ignorance of actual interest rates. My point--
Mr. Speaker : Order. Would this not make an interesting contribution to the debate? [ Hon. Members :-- "No."] I think that it probably would because, as far as I can see, it is not a matter for me. After all, I am frequently astonished at what I hear in the Chamber but, provided that it is in order, I have to let it go.
Mr. King : Yes, Mr. Speaker, but I wondered whether it would be possible to ask Hansard whether it has received any correction from the Leader of the Opposition by which he could establish what he was trying to say once and for all instead of leaving us with the waffly way in which he put it.
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Mr. Speaker : I am not aware that Hansard has been asked to make that correction. I repeat that the hon. Gentleman's point would probably be in order if he were to make it in a fairly sophisticated way in the debate- -that is, if he is fortunate enough to catch the eye of the Chair.
9.38 am
The Financial Secretary to the Treasury (Mr. Francis Maude) : It is relatively rare for the House to have an opportunity to discuss an important theme such as this, which runs right across all sorts of departmental responsibilities. Understandably, there is a tendency for debates to be focused on relatively narrow areas of Government and public life. It is therefore useful to have an opportunity for a wide-ranging and relaxed debate on something of profound importance that applies right across British life.
As you have said, Mr. Speaker, the title of the debate on the Order Paper, "Nationalisation, denationalisation and renationalisation", has been chosen to allow us to range fairly freely, and to allow the hon. Member for Newcastle upon Tyne, East (Mr. Brown) to make a few things a little clearer than they have been.
There used to be a complaint that in Britain we suffered from pendulum politics. The issue of private and public ownership of industry was used as an index of that. Ownership tended to lurch from private to public, public to private and back to public again. One had sympathy with those who worked in the steel industry, who were subjected to the pendulum. For years, the pendulum swung towards nationalisation and state ownership. From 1945 until the late 1970s, more and more areas of the economy came under state ownership. Since then, of course, the pendulum has begun to swing back.
In such matters, we should always seek to establish as broad a consensus as possible between the parties. Today gives us an opportunity to explore what scope there is for such consensus, how much of what it claims to believe the Labour party truly believes, and what we can agree.
The history of nationalisation and state ownership is lengthy and sorry. I do not doubt the motives of those who pursued the dogma. I accept that they believed that state ownership would somehow transform the lives of businesses. Indeed, it did so, but not in quite the way that was envisaged. I found an excerpt from the Labour party manifesto of 1945. It is an important and interesting historical document. It contains statements of the following nature :
"Amalgamation under public ownership will bring great economies in operation and make it possible to modernise production methods and to raise safety standards in every colliery in the country. Public ownership of gas and electricity undertakings will lower charges, prevent competitive waste, open the way to co-ordinated research and development, and lead to the reforming of uneconomic areas of distribution."
That is just a flavour of the spirit--I accept that it was sincere--in which the exercise was embarked upon all those years ago. It was believed that the process of state ownership would create dynamic companies with a work force driven to Stakhanovite effort by the knowledge that they were working, not for themselves, wicked capitalists or coal owners, but for society.
The commanding heights of the economy--railway, coal, steel, gas, electricity and companies such as Cable and Wireless, all the way through to Pickfords and Thomas Cook all fell sway to state ownership. I do not blame Labour for that. It was warned at the time that the
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policy would be disastrous--which it was. However, Labour was in the grip of a dogma, and those who are in the grip of a dogma do not always respond rationally to warnings. Of course, many other countries apart from Britain were doing likewise. In eastern Europe, not only the commanding heights but the sunlit uplands, the deeps of the valleys and every part of the economy was subject to the liberating and dynamic hand of state ownership. One can see the results clearly.For example, in 1938 the per capita gross domestic product of Czechoslovakia was the same as that of Switzerland. By the time that the Communist tyranny was removed in 1989, the GDP had sunk to a third of that of Switzerland. Such is the dynamising effect of state ownership. I do not wish to dwell on the record of nationalised industries in Britain. It is a sad and depressing saga in our nation's life. We all remember the British Steel Corporation, with its losses of £1 million every day of the year. We all remember British Telecom being in the Guinness Book of Records for the largest loss ever. We all remember the sloppy standards, the waiting lists for telephones, the ever-rising prices, the dingy tale of failure, the contempt for the customer, the craven management and the political interference. British Telecom was stifled by bureaucracies and governed by overweening trade unions. It had one theme running throughout-- utter contempt for the customer.
In the early 1980s, when the Conservative Government started to blaze the trail that has now burned worldwide, what was Labour's response? Was it a pragmatic response of concern for the customer? Was it a questing, practical approach and an attempt to seek common ground? Sadly, no. The reaction throughout in every case without exception was blind opposition and crusted reaction. The Labour party desperately held on to the hands of the clock to stop the march of time.
Mr. Michael Grylls (Surrey, North-West) : Before my hon. Friend gets too deep into the incredibly--or perhaps naturally--negative attitude of the Opposition to all the privatisation measures, may I take him back to what he said about the Labour party wanting to conquer the commanding heights? He will recall a well-known organisation of the 1970s called the National Enterprise Board. It was not only interested in the commanding heights but invested in the most ridiculous small businesses. That is not to say that small businesses are ridiculous. They are the most important part of the economy. But the investments were ridiculous because they were unsuccessful.
Mr. Philip Oppenheim (Amber Valley) : It is called picking losers.
Mr. Grylls : My hon. Friend the Minister will remember, because of his excellent memory and the research that he has done, a firm called Thwaites and Reed, which was a tiny, unsuccessful clockmaker on the south coast--not that is a fault. The south coast is a good place to be and we should probably all prefer to be on the south coast now. But there was Thwaites and Reed--one of the commanding heights of the economy. The NEB put £140,000 into it, which went down the drain. The NEB then put another £180,000--
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Mr. Speaker : Order. The hon. Gentleman is making a most interesting speech which should be made a little later.
Mr. Grylls : I was drawing my hon. Friend's attention to that example, because it seemed to fit in with what he was saying about the commanding heights. Does my hon. Friend agree that the commanding heights are rather more than the commanding heights? Therefore, there is a danger that, if Labour ever returned to power, it would tackle the lower heights, as well as the commanding heights.
Mr. Maude : It is entirely true that the Labour party used to talk about the commanding heights. It usually managed to level down substantially what it referred to as the commanding heights, so that the heights were rather less high at the end than they were to begin with. My hon. Friend the Member for Surrey, North-West (Mr. Grylls) does the House a service by reminding us of the tendency of the last Labour Government, as my hon. Friend the Member for Amber Valley (Mr. Oppenheim) put it, to pick losers with a sure and certain touch and to roam the byways of the British economy looking for something that they could make worse. Frequently they did so.
It is astonishing that, in spite of the self-evident failure of state ownership, when the Conservative Government came to reverse it and free businesses from the dead hand of state ownership and put them into the private sector where they could serve the consumers whom they were supposed to serve, the Labour party still clung to the dogma. It not only clung to the dogma and opposed what we sought to do but predicted the worst of disasters in every case. It predicted that there would be higher prices and less investment, that investment would cease, that poorer service and disbenefits for the consumers would be the result.
Let us examine what happened in practice, taking as an example British Telecom. Labour predicted that British Telecom would neglect public payphones and that they would disappear. What happened? In 1984, there were 77,000 British Telecom payphones. Today, there are more than 97,000, with Mercury payphones available on top of that.
Mr. John Marshall (Hendon, South) : And they nearly all work.
Mr. Maude : My hon. Friend predicts my next point. Are payphones neglected? Not at all. Today, over 90 per cent. of payphones work, whereas before privatisation up to a third did not.
Mr. Norman Tebbit (Chingford) : Some 95 per cent. of payphones work.
Mr. Maude : My right hon. Friend, with his detailed knowledge of the company, is able to provide up-to-the-minute information. He, too, does the House a service. Some 95 per cent. of payphones now work, compared with the shabby, shameful record under state ownership, when up to a third of payphones did not work.
Does the Labour party admit that it was wrong? I am a fair-minded man, as my hon. Friends will accept. I should like to give the Opposition Front- Bench spokesman, the hon. Member for Newcastle upon Tyne, East an opportunity to admit that the Labour party was wrong. Will it now apologise to all those who depend on
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call boxes for deliberately misleading and frightening them, many of them elderly people? Will the Labour party, just once, admit that it was wrong and say that it is sorry?Mr. John Marshall : Will my hon. Friend give way?
Mr. Maude : I should have preferred to give way to the hon. Member for Newcastle upon Tyne, East, but he has been smitten by unusual shyness.
Mr. Marshall : Does my hon. Friend regard it as significant that only two Labour Members are present? Does he think that the rest have gone out into the highways and byways to find more losers into which to put public money? Does he agree with me that Labour Members regard their policy as such a loser that they do not want to speak about it?
Mr. Maude : I fear that it is worse than that. I fear that the Labour party has abandoned its policy of simply picking losers. If it got into government by some unhappy mischance, it would scour the economy and every highway and byway of it to find successful businesses it could ruin. Instead of just pouring taxpayers' money into failures, it would take successes, the successes which have transformed the British economy during the 1980s, and ruin those as well.
Mr. Oppenheim : Is it not possible that many of the Labour Members who should be sitting opposite have slunk off into the well-known highways and byways to hide their heads in shame at the abject failure of their predictions? It is noticeable that 50 per cent. of Labour Members present is the hon. Member for Derbyshire, North-East (Mr. Barnes), who obviously feels so committed to clause 4 of the Labour party constitution that he has taken time off from his duties as collector-in-chief for the bail-out fund of his friend the leader of Derbyshire county council, Councillor Bookbinder, to be present today. We are very honoured that he is.
Mr. Maude : I wish that I could share my hon. Friend's optimism that Labour Members are hiding their heads in shame. I do not believe they are. I believe that they are preparing things that are worse, and I shall hint later at what they have in mind for the future. Once again, I am prepared to give the hon. Member for Newcastle upon Tyne, East, who is a straightforward chap most of the time, a chance to say honestly and in a straightforward, manly fashion, that the Labour party was wrong, that it misled and deceived the public. It should say that it is sorry, but I am afraid that the hon. Gentleman will not do that.
Mr. Nicholas Brown (Newcastle upon Tyne, East) : I hope that this will not come as a terrible shock to the Minister, even at this hour of a Friday morning, if I tell him that I will not say anything of that sort. I shall make my own speech, in my own time and in my own way.
Mr. Maude : The House will be united in disappointment at that poor intervention. The hon. Gentleman has shirked an opportunity to put matters right.
What were the Labour party's predictions about investment in British Telecom? It predicted that it would cease. However, in 1991, capital investment is running at £3 billion a year, double the 1984 level, since when total investment has reached £14.5 billion. In the 1970s, under
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the benign hand of the Labour Government and state ownership, British Telecom fell victim to Labour's capital spending cuts. When the bailiffs came in, the first thing to be cut was capital spending in the nationalised industries and in the health service and education. Since 1984, British Telecom has been able to invest heavily. How would it be able to invest without profit?I have another question for the hon. Member for Newcastle upon Tyne, East which he may care to reply to in his speech. Is it better for companies such as British Telecom to suffer under Government capital spending cuts, as it did in the mid-1970s, or is it better for a company to be self- sufficient and able to invest heavily in capital out of its own profits? I know what the customers think. They firmly believe that what happens now is better.
What about service to the customer? Throughout the debates on privatisation, the Labour party has harped on the theme that service to the customer will suffer. This year, British Telecom has offered a system of compensation to customers whose phones are not repaired within two working days. Did nationalised British Telecom ever do that? Is it conceivable that it would have been able to do that? Is the service now worse than the one that the customer previously received? Who now has to wait six months for a telephone number? Which is better, the performance of British Telecom when it was nationalised or the performance now?
Let us consider prices. I readily accept that call charges have risen. In one year, overall charges rose by 60 per cent. and local call charges doubled. Which year was that? It was 1975-76. Since 1984, call charges have fallen by 20 per cent. They will now be set at 6.25 per cent. below the June retail prices index increase, and it is not difficult to predict that that is likely to mean a fall in real terms. Clearly it is, and it is also likely to mean a fall in cash terms. Which is better for the customer : an increase of 60 per cent. and a doubling of local call charges, or a fall in real and cash terms? The hon. Member for Newcastle upon Tyne, East may like to answer that, too.
Let us consider pricing in the two decades. The cost of a three-minute, cheap-rate local call went up by 16 per cent. between 1971 and 1981. Between 1981 and 1991 it fell by 36 per cent. Will the hon. Gentleman say which was better? British Telecom has delivered better standards, higher investment and lower prices in the private sector than it could ever have done in the public sector. A similar story is told by the water industry in the brief period since it has been in the private sector. The quality of water has improved. In Severn Trent Water, my own area, 96 per cent. of the sewage works now comply with discharge consents, against only 76 per cent. before privatisation. Wessex Water is bringing forward the deadline to cease dumping at sea by five years, and it will comply with legislation to remove pesticide contamination from supplies three years early. Thames Water will open its London ring main ahead of schedule next year.
Capital investment in the water industry is rising sharply. In Thames Water, it rose by 59 per cent. last year, to nearly £400 million. North West Water spent more than £400 million on its core capital programme last year, and that is expected to rise to £500 million this year. Only five years ago, we were being told that the capital investment required by the water industry to replace the Victorian mains could not reasonably be met. What is happening now? The investment is being met by private sector
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companies raising capital in the private sector, and they are doing a far better job than they could ever have done in the public sector.In the past five years, electricity prices have fallen by 5 per cent. in real terms. Under a Labour Government, one has to admit that they rose by only 2 per cent.--2 per cent. every six weeks. Again, the hon. Member for Newcastle upon Tyne, East may like to comment on which was better for the consumer. Is he interested in the consumer or is he interested only in those who work for the businesses? Throughout the debates on privatisations, Labour claimed that catastrophe was looming. In 1983, during a debate on the Telecommunications Bill, the right hon. Member for Bethnal Green and Stepney (Mr. Shore) said :
"the Bill will undermine and frustrate the development of the telephone service as a universal amenity for all our people."--[ Official Report, 21 November 1983 ; Vol. 149, c. 37.]
What has been the reality? There are 3 million more private telephones for our people and lower charges have been introduced. The Labour party said that the customer would be ripped off, standards would fall and prices would rise. That was all wrong and irresponsible scaremongering. Will the Labour party apologise? So the record of privatised companies is higher quality, more investment and reasonable or falling prices.
The hon. Member for Newcastle upon Tyne, East may claim that some of those companies' profits are too high and should be lower. The idea that shareholders who have invested their money in the companies should get a return on that capital is still anathema to him and his hon. Friends.
Does the hon. Gentleman accept that those profits mean that the state receives more in tax receipts from those companies than it ever received under state ownership? Does he believe that investment is better from profit or that it is better borrowed, subject to political control and whim? Whose judgment does he believe is better of what amounts to an acceptable rate of return? For example, for British Gas, does he believe that the sober, hard-headed judgment of Mr. Mackinnon, the director-general of the Office of Gas Supply, is to be preferred to the judgment of the hon. Member for Holborn and St. Pancras (Mr. Dobson)? I know whose judgment the British public at large prefer.
Profits are subject to control. If they are excessive--if it is judged to be an unreasonable rate of return--there is tougher regulation for those industries than ever there was under state ownership. The Office of Telecommunications has far greater powers to interfere and intervene, in detail if necessary, with the operation of British Telecom on behalf of the customer than ever the Government could have done. So the complaint that there are excessive profits says far more about the attitude of the Labour party than about the companies. Too often, Labour Members show how they hate success. Those profits show--at the same time as charges and prices have been falling in real terms--that businesses are performing better for the customer.
Considering that record of success, it is small wonder that privatisation is spreading far and wide. The Labour Government in Australia are proposing to privatise the Commonwealth bank, airlines and satellite communications.
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Mrs. Teresa Gorman (Billericay) : My hon. Friend has not referred to the appalling record of labour disputes that we used to have when those industries were owned and run by the state, with overmanning and so on. At that time, we had an appalling level of disregard by unions of the public's interest, leading up to the terrible crisis of 1979, when people were not even being buried. That was an appalling aspect of national ownership and control and political interference in industry.
Mr. Maude : My hon. Friend is right. A grubby set of negotiations between the Government and trade union barons managed the state-owned companies under Labour Governments. Where, so often, were the interests of the consumer? The consumer was left out of the calculation. It was entirely to do with deals done between Labour Ministers and trade union bosses. I hope that we never see that again. The hon. Member for Newcastle upon Tyne, East can help us over that. Does Labour propose to return us to that state of affairs? I was referring to parts of the world where privatisation has now taken hold. In Sri Lanka, the textile industries, television, hotels and distilleries are being privatised. In Greece, there is a list of 150 potential sales in preparation, including petrochemicals, vehicles manufacturers and refineries. In Eire, the list includes Irish Sugar and B and I Line ferries.
Mr. Menzies Campbell (Fife, North-East) : Oh, dear.
Mr. Maude : Does the hon. and learned Gentleman think that they are all wrong and he is right?
Mr. Campbell : If the position of the sugar industry in Ireland is considered by the Minister to be a compelling part of his argument, he is stretching for examples to prove his point. Surely he has better examples to give the House.
Mr. Maude : I am giving examples in random order, and I shall be favouring the House later with some better ones. I hope that the hon. and learned Gentleman will take part in the debate and say whether he thinks all those people are wrong and the Labour party is right. In Hungary, telecommunications, construction industries, oil industries, chemical businesses and hotels are being privatised. Large companies in Czechoslovakia are lodging proposals now, and full-scale privatisation starts this summer. In Poland, 1,000 companies are being privatised this year. In Argentina, telecommunications, airlines, electricity businesses and shipping are all headed for the private sector.
In Brazil, the steel industry and a wide range of other industries are heading out of the public sector into the private sector. In East Germany, 1,200 companies have already been sold and other, more difficult, candidates are planned to be sold. In Japan, telecommunications, the railways and tobacco industries are all heading for the private sector. In Mexico, banks, the steel industry, telecommunications and television are being privatised. In New Zealand, the telecommunications business is being privatised. In the Philippines, airlines, banks and oil are heading out of state ownership. Banking, steel and newspaper industries in Portugal are all heading out of state ownership. In Venezuela, airline businesses, banking and telecommunications are being released from the dogma of state ownership. In Cuba, they are selling housing.
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In other words, in countries in every continent, under Governments of every complexion, privatisation is now the watchword. It is happening almost everywhere but, sadly, not quite everywhere. I think particularly of three redoubts of reaction, three bastions of the old dogmas. There is no commitment to privatisation in North Korea, Albania or-- [Interruption.] My hon. Friends have probably guessed the third. It is the British Labour party. Walworth road lines up alongside North Korea and Albania. Labour Members have opposed every move to privatisation with every ounce of fight they could muster.Mr. Steve Norris (Epping Forest) : My hon. Friend may not be aware that I have had the interesting privilege of visiting Albania several times. Before he links the newly elected democratic Government in Albania with the British Labour party, may I ask him to put on record the distinction that at least in Albania they recognise that nationalisation was wrong and are intent on changing the system?
Mr. Maude : A valuable part of this debate has been the way in which hon. Members have introduced up-to-the-minute information from all parts of the world, and my hon. Friend testifies that the list is now down to two. Only in North Korea and Walworth road do the dogmas lie untouched. Even in Albania, in Tirana, the world is moving forward. The thinking there is more advanced than it is in Walworth road.
Labour has opposed privatisation at every stage, and the hon. Member for Newcastle upon Tyne, East now has the whole morning before him to set out his stall. He has had all week in which to consult his hon. Friends so that he can array their pledges before the House in sparkling order for scrutiny. He may also wish to answer a few questions. For example, is clause 4 still an integral part of the Labour party's constitution? [Interruption.] We note that the hon. Member for Newham, North-West (Mr. Banks) has joined the hon. Gentleman on the Opposition Front Bench. The hon. Member for Newcastle upon Tyne, East may wish to seek some ideological reinforcement from his hon. Friend. Does the common ownership of the means of production, distribution and exchange still bind the Labour party in the way that it always did? What is the current interpretation? Are there plans to repeal it? If not, what will the Labour party do? Perhaps the hon. Member for Newcastle upon Tyne, East will choose not to answer those questions, in which case we must look elsewhere to see what others have said about it. In 1986, a document intriguingly called "Social Ownership" said that clause 4 of the party's constitution
"is as relevant today as it ever has been".
Does the hon. Gentleman believe that it still exists? Does he propose that it will operate under a future Labour Government? The right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) said that British Telecom
"is coming back into public ownership in its old form immediately".
I emphasise his statement that that is an immediate priority on the return of a Labour Government and there is no backsliding or temporisation about that. What could be clearer?
One of the last Labour documents, "Looking to the Future" published in May 1990, says :
"If the public stake in BT's equity remains at 49 per cent., we shall buy sufficient shares at a fair market price to take that stake to 51 per cent.".
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That statement was made a year ago. In this year's document, the Labour forgot to mention that. Was it a mistakeof the printers? Did it simply get left out at the typesetting stage? At the press conference where it was launched, the Leader of the Opposition was asked about it and forced to admit :"there's no change in the policy there".
Why was it not mentioned in the document? Was the Labour party ashamed of it? British Telecom is the largest company in Britain, and the Labour party should say whether it is committed to returning it to state ownership.
Mr. Tony Banks (Newham, North-West) : They are working on it.
Mr. Maude : The hon. Gentleman says that the Labour party is working on it, and I believe that.
Mr. Banks : I was just passing through the Chamber. I said that the Government are working on it, and was referring to the Minister's statement that British Telecom was the largest company in Britain. If the Government's policies are in place for much longer, British Telecom, like many other companies, will find itself among the small businesses.
Mr. Maude : That is a remarkable proposition, because I fancy that the hon. Member for Newcastle upon Tyne, East will, in a few minutes' time, complain bitterly to the House that British Telecom is too large and becoming larger, and is making too much profit. The hon. Member for Newham, North-West takes a different view : he claims that British Telecom is a failure that will crumble away into nothing. Perhaps, Mr. Deputy Speaker, the House would like to adjourn for a few minutes to allow them to decide the Labour party's approach. Is the Labour party committed to renationalising and stripping away the shares of the employees and millions of shareholders who have invested their money in British Telecom? If the House does not have a clear answer today, we shall be very disappointed indeed. What did the Labour party say about British Gas when it was privatised? The then Opposition spokesman said :
"under a Labour Government will be returned to the public sector".--[ Official Report, 25 March 1986 ; Vol. 94, c. 810.] Is that still true? If not, was it wrong to claim that privatisation was bad and should be reversed? Will it be put right by the Labour party now?
What did the Labour party say about the privatisation of electricity? In 1988, the hon. Member for Copeland (Dr. Cunningham) said, in the debate on the Address :
"We are implacably opposed to proposals to sell off our nation's electricity"--[ Official Report, 28 November 1988 ; Vol. 142, c. 445.]
Is that still so? Is the Labour party still opposed to it? Will it renationalise it?
Mr. Nicholas Brown : That is a different question.
Mr. Maude : Perhaps then, we shall have a different answer. I hope, above all, that we shall have an answer. The Labour party has been dodging those issues for months, and the country demands an answer. The hon. Member for Kingston-upon-Hull, East (Mr. Prescott) gave a partial answer when he said :
"We shall ensure that the industry is returned to public control if the Secretary of State is successful in privatising it".--[ Official Report, 7 March 1988 ; Vol. 129, c. 66.]
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That statement was made as recently as March 1988 by the then official Labour party spokesman on energy. Is that still Labour party policy?How would the Labour party renationalise the water industry? That is the only part of its policy about which it has been open and honest. It has said that it will take water back into public control. How would it go about it? In its document, "Meet the Challenge, Make the Change" it said :
"There would be no question of paying other than a fair market price for any equity or other ownership rights we wish to acquire". What is meant by "a fair market price"? The hon. Member for Dagenham (Mr. Gould) said-- [Interruption.] The hon. Member for Newcastle upon Tyne, East should listen to the words of the hon. Member for Dagenham, because the House will expect him to comment on them. He said :
"A Labour Government would take action to regulate the water industry, which would reduce the profitability of the privatised water companies and therefore would be likely to depress the share price. Investors should take that into account."
I agree that investors should take that into account, and I am sure that they will. Is that a description of paying a fair market price?
Mr. Tebbit : It is a fairly clear description of a Labour Government's policies. They would do what they have always done. First, they would wreck the business and then they would say that it is wrecked and worthless. The country would then have to wait for a Conservative Government to come back into office and reprivatise the industry to make it successful again.
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