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Column 690more considerate of users than is the present Heathrow body. We can hope--I hope not in vain--that Aldergrove's reputation for efficiency and user friendliness will not be damaged by the legislation which we are being asked to endorse, but which we shall not willingly endorse.
We have had a constructive and useful debate. I have listened with great care to all the contributions. I understand that some hon. Members oppose privatisation in principle. There have also been a large number of detailed questions which I shall do my best to address. If, when I examine the Hansard report in more detail, I find that I have not addressed any specific questions, I shall write to the hon. Member concerned.
I share the reservations that have been expressed about this procedure. I share the reservations about the fact that we have to consider a privatisation measure by means of the Order in Council procedure. I share the concerns about the consequences that flow from that and about the fact that it is not possible for hon. Members to table amendments, which makes it difficult for us to discuss matters of detail. However, I am afraid that it is not practical in every case for the Government to introduce Bills to cover such provisions. I am sorry about the fact that it is just not a practical proposition.
The hon. Member for Wigan (Mr. Stott) talked about airport development in Northern Ireland. Northern Ireland, with its population of 1.5 million, is remarkably well served. We could have a rather interesting debate about whether Belfast city airport and Belfast international airport are complementary or in competition. I suspect that there is an element of each in the service they afford to customers. The provision for a population of 1.5 million is rather satisfactory and offers customers considerable choice.
The hon. Member for Wigan was concerned about the European regional development fund money. I had not seen the letter from Bruce Millan, although I have now read it with care. On the face of it, it appears to conflict with the advice that we have received from the Commission. I believe that the explanation is as follows. The ERDF grant was paid at the rate of 50 per cent., which is the rate that is paid to private sector operators. It will be open to the airport to claim grant at that rate when it is privatised. In practice, although there may be a potential threat, I do not believe that there is any real threat of the money being clawed back by the Commission. I hope that that explanation is helpful.
The hon. Member for Wigan talked about the market value of the airport. That value is what someone is prepared to pay for it in an open market. We have had 10 serious expressions of interest, so there is no shortage of interest. What we cannot do is to meet all the different concerns that have been expressed. Price will obviously be very important. I was pressed earlier by the hon. Member for Workington (Mr. Campbell-Savours), who said that we
Column 691should get the best value for money for the taxpayers and that, if we did not, we would be in trouble with the Public Accounts Committee.
Other hon. Members pressed me on other considerations, such as the need to ensure that there is a local interest and consideration of a management- employee buy-out. We shall have to weigh up all the different factors and make the best decisilong with all the others. We have heard a lot in the debate about policing. At present, policing levels at the airport are determined by management. They will continue to be determined by management when it is privatised, but under the supervision of the Royal Ulster Constabulary. There cannot be any question of management suddenly deciding to make a 50 per cent. cut in policing at the airport. That would not be acceptable to the RUC, which will continue to have a supervisory role.
The hon. Member for Thurrock (Mr. MacKinlay) suggested that there may be a conflict--that perhaps an instruction given to a police constable may be based not on the best policing but on the convenience of management. Frankly, if that sort of thing happened, the RUC would take a considerable interest in it. If it continued, the Secretary of State would have to step in. As I said, he has considerable powers to step in and, indeed, take over policing of the airport if necessary. The existence of that sanction, and the knowledge that it exists, will deter any private sector operator from behaving in that arbitrary way in the first place.
Mr. Mackinlay : The scenario described by the Minister does not protect the individual police officer. At the moment, if he is given an unlawful or improper instruction he is put in a most invidious position. As I said, police officers do not have protection that is comparable to that of other workers--a federation or a trade union. The Minister is not providing the capacity for an individual police officer to behave with the utmost propriety, as is his wish, if an employer wishes to give an improper instruction.
Mr. Smith : I understand that, but it is the situation which prevails at present. It would be equally possible for the present management to behave in that way, but they do not do so because they know that it is not acceptable--it would not be acceptable to the RUC. I do not believe that a policeman is likely to be put in that position, for the reasons that I have given.
The hon. Member for Wigan asked about other workers at the airport. The answer is that the TUPE provisions will apply and their pension rights will be preserved. They will be transferred when the company is privatised.
The hon. Member for Antrim, South (Mr. Forsythe) asked about pension arrangements, so perhaps I can deal with that matter now. There is a small deficit in the pension fund at present which is being made up by increased contributions from the employer. The pension scheme will be transferred to the new company and the pension rights of existing employees will be preserved in the process. The hon. Member for Wigan asked who has the ultimate responsibility for security at the airport. The answer is that the airport operator has responsibility at present, and will
Column 692do so when the airport is privatised. The hon. Gentleman also asked who will pay for security. The answer is that the airport operator pays for security at present, and will be required to do so in the future. There cannot be any question of the airport operator cutting back on security costs simply for commercial reasons in an attempt to increase profit. That will not be acceptable. The operator will have to provide the level of security that is agreed with the RUC. The hon. Member for Antrim, South was good enough to thank my Department's officials and, indeed, my predecessor, my hon. Friend the Member for South Ribble (Mr. Atkins), for the detailed discussions that have taken place and I am grateful for what he said. He wanted to know whether we would simply sell the airport to the highest bidder. As I said, price will obviously play an important part, but there are other considerations, and one of the most important is the question of a local element. A management-employee buy-out will be considered carefully, together with all the other bids.
The hon. Gentleman referred to some specific provisions in the order, including article 18(3)(i), which refers to an airport official or a constable requiring a person to leave the airport. That is a repetition of what we already have in law both in Northern Ireland and Great Britain, so there is nothing special or peculiar about that. It applies to all airports --there is nothing special about it in this case.
The hon. Gentleman also referred to article 20(2)(c) and the words "which affects their interests". One should not read too much into that. Obviously, we want to establish good consultative arrangements with everyone who has an interest in the operation of the airport, whether it is the users or the district councils representing those who are affected by its operations. We want to find the best way forward, and it will be for the airport operator to establish satisfactory relations. Obviously, it will be in the operator's interest to have good relations with all these interests. That is not particularly limiting because, obviously, people will be put on bodies because they represent specific interests in the community. I have dealt with the questions raised by the hon. Gentleman about the pension scheme. Perhaps I can move on to his points about policing and the control exercised by the Northern Ireland Office. He talked about a conflict. As I said, a conflict could arise at present. However, I do not believe that it will arise, for the reasons that I have given. The hon. Gentleman asked whether security will be maintained at the highest level. It will be maintained at the level necessary to ensure that the airport is properly protected, just as it is at present. In that sense, I do not believe that there will be any change in the arrangements.
The hon. Gentleman asked whether the Secretary of State would have power to direct the owners to meet security standards. Effectively, I believe that that will be so. Indirectly, the Secretary of State will have that power. The hon. Gentleman asked whether he might have access to the security committee. The answer is yes. I cannot give a lot of details about the security committee, but, certainly, the hon. Gentleman will have access to it. I do not know what the committee will be called. The question about the name did not apply to the committee--it applied to the name of the police force. I am not able to say whether there will be a new title for the police force ; it will be a matter for the operator.
I was asked whether there will be a formal agreement with the union representing the airport police. The answer
Column 693is that there will be a contractual arrangement which will be put in the prospectus, so it will be a clear condition that any bidder must accept as part of making a bid.
Mr. Mackinlay : I am sorry to labour this point, but the police officers do not have a trade union or federation. Their representative organisation is the association, but it has no statutory base. The police have asked the Government to give the association a statutory base, but they have failed to do so. It is grossly unfair, inept and dangerous to the police and, ultimately, the Government and the airport operator.
Mr. Smith : I am sorry if I called it a union--it is the association. It will be protected in the way that I have described : there will be a contractual arrangement which will be set out in the prospectus, and any prospective bidder will have to accept it. That is how members of the association and their interests will be protected.
The hon. Member for Antrim, South asked about Belfast city airport. I understand that. Although it is not what we are discussing today, it is relevant. The hon. Gentleman was right to point to the success of that airport and the fact that it has forecast 1.2 million passengers this year- -a substantial rate of growth.
Obviously, that airport has produced some problems. If there are problems with noise levels, we will need to look at that issue. Certainly, there are problems with road traffic and the hon. Gentleman described some of them to the House. The problems of access to the airport and so on are already the subject of discussions at an official level. We must consider precisely what we will do about that, because there have been problems with the traffic recently. Those who are responsible for roads are examining the problem to see what we can do about it.
Mr. Stott : On the subject of Belfast city airport, I am not pressing the Minister to disclose at the Dispatch Box whether the owner of the city airport, Bombardier, could be a potential bidder for the international airport. However, will the Minister state whether the bid would be referred to the Monopolies and Mergers Commission if that were to be the case?
Mr. Smith : I can help the hon. Gentleman on that point. At one time, Bombardier considered making a bid, but it is not doing so. I think that it understood that it would have the kind of difficulties to which the hon. Gentleman referred.
Mr. Smith : I am unable to do so at the moment. I do not think that it would be appropriate to do so. [ Hon. Members-- : "Is he a Tory?"] One must be cautious with security issues. I will see whether I can provide more information on the matter for the hon. Gentleman later. The hon. Member for South Down (Mr. McGrady) was also concerned about the Order in Council procedure, which I have tried to deal with. He does not like privatisation either, and he said that Northern Ireland had not benefited from it. It is a little too early to judge the success or failure of Northern Ireland Electricity.
Column 694British Telecom was privatised in 1984 and subscribers in Northern Ireland have benefited from that privatisation, as have subscribers in the rest of the United Kingdom, even if there is no competition. Telephone bills have come down by 20 per cent. in real terms and further cuts were announced the other day. A result of those cuts is that the peak morning rate has been abolished. [Interruption.] The hon. Member for Bradford, South (Mr. Cryer) does not like good news, but this is good news for the consumer and it has come directly as a result of the Government's privatisation policy and increased competition.
Madam Deputy Speaker : Order. Before we continue, I should point out that this matter is not really germane to the debate. Passing reference to the subject may be made, but it should not make up the substantial part of the debate.
The hon. Member for South Down also referred to the fact that the airport is first class, and that it had had major refurbishment. I agree with that, and it will be even better when it is privatised. Those involved will be even more concerned to provide good service to the customer, without which one cannot maximise profits. The airport will have access to private capital markets to increase investment, and there will be more management freedom. As a result, everybody who uses the airport will benefit from privatisation.
The hon. Gentleman was concerned about the method of sale and I understand that he would have liked a flotation. It was a difficult judgment to make, and we were concerned with the size of the proceeds of the sale. That will be examined carefully by the Public Accounts Committee. I could point to a number of trade sales--for example, Sealink and Royal Ordnance--which have raised considerably more than the Belfast airport is likely to raise. it is impossible to say exactly what the threshold is. A different judgment has to be made in each case. This case was carefully considered, and the judgment was reached that a trade sale was the most appropriate means in the particular case.
The hon. Gentleman also asked about consultants, and I can assure him that a competitive tender was engaged in for each appointment, as is always the case in such matters.
Mr. McGrady : May I refer to a matter to which I thought the Minister would return concerning security? He is aware that the police at Belfast international airport do not now service the building area, and that that has been taken over by a security firm. What responsibilities previously exercised by the police are now exercised by the security firm? Is the level of security the same where the police are no longer involved? Are the police or the security firm responsible to the present employers in exactly the same way?
Column 695operating in a part of the airport area. I will certainly provide the hon. Gentleman with more details on that matter if necessary. The hon. Member for Thurrock talked a great deal about policing at airports in Great Britain, but I think that he misunderstood what I said. I did not suggest that arrangements would be the same in Belfast international airport as they are in Great Britain. I have gone to great lengths to try to explain why that is not the case. We have satisfactory arrangements, and all we are doing is transferring them during the privatisation. I am not in favour of change for change's sake. We have good arrangements, and they will be continued.
The hon. Gentleman was, on the whole, rather inclined to exaggerate the consequences of the matter. I understand his concern about the pay and conditions of people who work at the airport, and in particular the police. Those are presently matters for the management, as they will continue to be after privatisation.
The hon. Gentleman was also concerned that the association does not have trade union status. It does have negotiating status, and surely that is important. That negotiating status will come by virtue of a contractual arrangement, and its rights are enhanced by the order. If the hon. Gentleman looks at clause 19(5), he will see that that is the case.
The hon. Gentleman asked about future owners, and what would happen if the purchaser were to sell the airport to another owner. We have full protection. In the prospectus, we will have effectively a golden share, so we have control. It is vital for security reasons that we have that control.
The right hon. Member for Lagan Valley (Mr. Molyneaux) referred to the "missing link". I am glad that we have, as a result of his efforts, the missing link to the airport. He also talked about the consultation process and the importance in particular of consulting the users of the airport. I agree with him, and I sympathise with his experience at Heathrow. I hope that we will be able to do better at Belfast international.
It is in the interests of any airport operator that it should properly consult the users. They are, after all, the customers of the airport. Those customers have a choice of which airport to use on some routes, and we will want to ensure that users are properly represented on any consultative committee and that their views are properly considered.
I hope that I have answered all the points raised in the debate. The Government strongly support the concept of privatisation. In this case, it will bring great benefits to the customers of the airport. The airport will have access to the private capital markets, and it will have the freedom to manage. That will be in the interests of all the people of Northern Ireland, and of all those who use the airport.
Question put :--
The House divided : Ayes 270, Noes 224.
Division No. 121] [5.57 pm
Ainsworth, Peter (East Surrey)
Alison, Rt Hon Michael (Selby)
Allason, Rupert (Torbay)
Arnold, Jacques (Gravesham)
Atkinson, David (Bour'mouth E)
Atkinson, Peter (Hexham)
Baker, Rt Hon K. (Mole Valley)
Baker, Nicholas (Dorset North)
Banks, Matthew (Southport)
Banks, Robert (Harrogate)
Column 696Bates, Michael
Beresford, Sir Paul
Biffen, Rt Hon John
Blackburn, Dr John G.
Bonsor, Sir Nicholas
Bottomley, Peter (Eltham)
Bottomley, Rt Hon Virginia
Boyson, Rt Hon Sir Rhodes
Brooke, Rt Hon Peter
Browning, Mrs. Angela
Bruce, Ian (S Dorset)
Carlisle, John (Luton North)
Carlisle, Kenneth (Lincoln)
Clark, Dr Michael (Rochford)
Coombs, Anthony (Wyre For'st)
Cope, Rt Hon Sir John
Currie, Mrs Edwina (S D'by'ire)
Curry, David (Skipton & Ripon)
Davies, Quentin (Stamford)
Davis, David (Boothferry)
Deva, Nirj Joseph
Douglas-Hamilton, Lord James