House of Commons Hansard Debates for 5 Dec 1996 (pt 12)

4.55 pm

Mr. Peter Atkinson (Hexham): I welcome the proposal, which is an important piece in the jigsaw of the regeneration of the River Tyne. Standing here at nearly 5 pm on a Thursday, in what can be described as a thinly attended House, I am reminded of earlier days when we discussed similar matters. The hon. Member for Oxford, East (Mr. Smith) tried to make a brave fist of it, but I seem to have heard the phrases "price increases", "falling standards" and "pure political dogma" before in reference to privatisations. Labour Members used those phrases about British Telecom, British Airways, British Rail, British Steel and British Coal. Every time the Government proposed a privatisation, Opposition Members have stood up to complain.

We know perfectly well, as do consumers, that privatisation is a success. It is not that the companies that have been privatised were failing--many were, but not all--but they have made significant improvements in the way they are run, and I see no reason why the Port of Tyne Authority cannot do the same. The authority has its critics--we are aware of that. Some say that it has allowed its infrastructure to run down over the years; others have said that it has not been diligent enough in dredging the river. Still others believe that it has allowed too big a cash mountain of assets to build up--it was £19 million at one stage, although I believe it is now lower than that.

The criticisms are unfair. The Port of Tyne Authority has had to deal with a difficult period in the development of the river, following the remorseless decline of

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traditional industries such as coal shipping, steel and shipbuilding. For the first time, the Tyne now has some prospects of real growth in the new sunrise industries. My hon. Friend the Member for Tynemouth (Mr. Trotter) mentioned the offshore industry, which will make particular demands on the port. Some companies involved in the offshore business might be interested in the port itself because they would like it to be better designed for their kind of growing business, and it is in such businesses that the Tyne will have a great future.

I will not repeat what my hon. Friend the Member for Tynemouth said; he set out the case extremely well. I believe that a change of culture will be of considerable benefit to the port. Hon. Members who do not know about the north-east of England--there are not many in the Chamber--should be aware of the tremendous renaissance that has taken place on the river, and everyone should be proud of that. I am proud of the way in which the city of Newcastle and its quayside have developed and of the new developments down the Tyne. They are there because of the operations of organisations such as the Tyne and Wear development corporation and the grants given by the Government.

Above all, the Tyne is recovering because of the Government's economic policies. The Government were brave enough to take tough and painful decisions about the coal industry and about the Swan Hunter shipyard when it ran into trouble. Opposition Members called for greater subsidies for the coal and shipbuilding industries, but the Government's tough decisions have allowed new industries to grow on those sites. Without that, there would not have been a renaissance on the Swan Hunter yard site where, rather than a sunset industry there is a sunrise industry. That is what we must build on, and it is why we want the port in private hands, with new ideas and innovation.

4.59 pm

Mr. Chris Davies (Littleborough and Saddleworth): Liberal Democrats want efficient, innovative and successful businesses throughout the country. We oppose the privatisation, because the Port of Tyne Authority is just such an organisation. We have heard how the trustees of the authority are appointed, so it might come as a bit of a surprise that Liberal Democrats should give such backing and praise to an organisation that owes its origins so much to the Secretary of State--but we do.

It is worth hearing what the Secretary of State's appointees have to say to him about the proposal. They have written to him submitting

"that there is overwhelming evidence that privatisation of the Port of Tyne, rather than enhancing the commercial prospects of the Port"

as he suggests,

"would damage customer confidence, jeopardise the Port's prospects at a sensitive time of transition and lead to a loss of trade and investment, with serious implications for the North-East region."

As the hon. Member for Oxford, East (Mr. Smith) rightly said, this is privatisation for privatisation's sake. I listened carefully to the Secretary of State. I had looked forward to hearing convincing arguments that would persuade me that there was some flaw in what I had been told by the Port of Tyne Authority and by those who support its case, and that it was in fact a moribund organisation, the removal and replacement of which by a

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body purely in the private sector would be to the benefit of the north-east as a whole, but I found no such arguments in what he said.

The Secretary of State referred only to the general experience that privatisation is beneficial. He suggested that all the evidence was one way, but he produced not evidence but a series of assertions that are challenged not only in the House and by millions of people throughout the country but by many of our strongest economic rivals, who run their infrastructure rather differently from the way in which the Conservatives have run ours over the past 18 years.

The Port of Tyne Authority does not even have to work within the straitjacket of financial restrictions such as those imposed by the Government on the Post Office or on Manchester airport; it is able to invest, and it does. In proportion to its income, the port has invested twice as much as the Medway and Forth ports and three times as much as Tilbury and Clyde, and it has plans to invest a further £15 million in infrastructure improvement over the next five years. It is not sitting on the surplus land but handing it over for development by other organisations.

If the Secretary of State can point to any evidence, I suspect that it will be purely one-sided. His point about declining tonnage demonstrated that we were being given selected figures. He said that the port of Tyne had witnessed a decline in tonnage in recent years, and compared that with the situation on the Clyde. He did not, however, mention that the crucial reason for that is that coal production in the north-east is still declining, whereas in Scotland it has been virtually finished off already.

The Secretary of State did not cite one port user who wants the privatisation to take place. We have heard of some of those who do not want it to take place, and I want to draw attention to some other representations that have been made. For example, the chief executive of Mitsui O S K. Lines--not exactly a small company, but one of the organisations that has made Japan great and had a tremendous impact throughout the world--wrote:

"My colleagues in Japan and Europe all feel strongly that the process and effect of Privatisation of the Port of Tyne will, at the very least, result in instability and uncertainty, which will damage confidence in the region, to the detriment of present and future inward investment."