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5.8 pm
Mr. David Clelland (Tyne Bridge): This is a privatisation too far. I was tempted to say a bridge too far, because the river's bridges are as famous and as potent a symbol of the north as the Tyne itself. Indeed, my constituency is named after the most recognisable of the six main transport crossings between Gateshead and Newcastle.
One consequence of the Government's interference in the locality and the dash-for-cash mentality behind it is that the swing bridge may be permanently disabled and prevented from opening to allow vessels upstream. We are not talking about tall ships--even the local ferry boat cannot pass under the swing bridge unless it is open. Any hope of reviving business or pleasure traffic movements upstream of the bridge will be lost. With the proposed industrial developments along the river banks upstream of the swing bridge, who knows how valuable a transport corridor may be lost as road traffic congestion worsens.
One of the Tyne's many famous sons, Jimmy Nail, recently wrote a song about the Tyne called "Big River". He sings of the river's industrial past and its decline, but also about the spirit of the people and the conviction that the river will again become a centre of activity for the community along its banks. That is already becoming apparent, as the work and plans of the local authorities and development corporation come to fruition.
One line in Jimmy Nail's song goes:
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In the consultation process on the Port of Tyne Authority document and the Secretary of State's proposals, no fewer than 465 representations were made to the Secretary of State. Only four organisations favoured privatisation; all four were potential bidders for the port. Two of them have no previous history of interest in transport, let alone in ports, but a considerable interest in land and property.
My hon. Friends have given examples of representations made by businesses on the Tyne. The Tyne Port Users Association says:
I ask Conservative Members--I know that there are not a lot of them--what is the value of a consultation if so huge a majority is completely ignored? The situation contrasts sharply with the Government's change of mind about Dover, which is not to be given the benefits that the hon. Member for Tynemouth (Mr. Trotter) outlined. Only two objections were made to the Dover scheme: one from the Queen Mother and one from Vera Lynn. They were considered more important than the 460 individuals, organisations and elected representatives on Tyneside who opposed this privatisation.
Mr. Stephen Byers (Wallsend):
It was informative and interesting to hear the Secretary of State speak in favour of the order. The bulk of his contribution had nothing to do with the forced privatisation of the Port of Tyne Authority. It was a Cook's tour of other ports in England and Scotland and an argument for the dogma that drives the Conservative party: the need to privatise everything. He would not address the specific proposals before the House, because he knows that there is no sensible or logical argument for compulsory privatisation of the authority. At risk is the success story of the authority over the past 10 years. It is being sacrificed on the political altar of privatisation.
As my right hon. Friend the Member for Jarrow (Mr. Dixon) said, 15 or 20 years ago many hon. Members would not have been prepared to support the continuation of the Port of Tyne Authority. It was inward-looking, would not work in partnership with the local authorities or local industry and was slow at developing strategic parcels of land on the banks of the River Tyne. I remember some 17 years ago, as deputy leader of North Tyneside council, being responsible for making representations to the authority and arguing that it should make progress on developing the river. It was not supportive of those representations. However, the Port of Tyne Authority of 1996 is a different beast from the authority of the early 1980s. It is a body that reflects the needs and aspirations of the local community, that makes a profit and that has played a key part in assisting the region to overcome the difficulties that have been imposed on it by the Government's economic and social policies.
The Secretary of State failed to address several of the key issues that were raised in the representations of local people and communities and the authority. He failed to address properly employment protection or pensions. He failed to address the way in which profits could be stripped out of the port and used for different purposes, diverting money that is made by the port and is currently ploughed back to make it an even greater success story. That money may be used for whatever purpose the successor body determines; it is being taken away from the Tyne, which desperately needs regeneration and investment. It largely needs them because of the failure of the Conservative Government's policies.
Ms Glenda Jackson (Hampstead and Highgate):
I pay tribute to my right hon. Friend the Member for Jarrow (Mr. Dixon) and to my hon. Friends the Members for Tyne Bridge (Mr. Clelland) and for Wallsend (Mr. Byers), who have so passionately defended their constituencies.
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When the Ports Bill was introduced in the House in 1991, my right hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) said:
The Government claim that enforced privatisation brings three benefits. It reduces overmanning and increases productivity; increases competitiveness and investment in the ports and their infrastructure; and enables ports to extend the scope of their commercial activities, and make better use of surplus land and other assets available to them.
The aim is to achieve better productivity, more investment and a greater expansion of a port's commercial activities. Under the Government's criteria, they are hallmarks of a successful port facility. How does the port of Tyne square up to those tests?
Let us consider the first test of overmanning and productivity. In 1988, the number of workers employed by the port of Tyne exceeded 500; today, that figure is just over 200. In 1988, the payroll costs of the port stood at £7 million annually; but, over the past six years, those costs have fallen by more than 20 per cent. No one in the Labour party takes any pleasure from those figures. Only a fool would rejoice in job losses of that scale, but we appreciate the competitive nature of the ports industry and the requirement of the port of Tyne management to keep their cost base to a minimum. They have done that. They have drastically reduced labour costs and significantly increased productivity without the heavy hand of enforced privatisation. The efficiencies that the Government define as indicative of a successful port have already been achieved by the port of Tyne.
The Government's second benchmark is the achievement of greater competition and investment. How has the port of Tyne, starved of the perceived benefits of privatisation, performed in that regard? As the Secretary of State said, in the first two years following privatisation, the five privatised trust ports increased their pre-tax surplus by an average of 97 per cent. The right hon. Gentleman attempted to dismiss the point made by my hon. Friend the Member for Oxford, East (Mr. Smith) that, over the same period, the port of Tyne had increased its pre-tax surplus by 172 per cent. The port has also embarked upon a capital investment programme worth more than £20 million. Does that programme expose the port as an enterprise failing to develop its full potential? Of course not. It exposes it as an enterprise that is growing and thriving, and the last thing that any such enterprise requires is interference from the Government.
The port of Tyne has already met two of the Government's criteria for a successful port facility. The third one is that a port should stimulate the development of land surplus to its requirements. In 1990, more than 100 hectares of the port's land around the Albert Edward dock was vacant. Today, just 23 hectares of it remain vacant, but they are reserved for operational and port-related use. The number of tenanted areas has
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The port of Tyne has achieved the efficiency gains sought by the Government. It has earned profits and sustained an investment programme greater than those of the privatised trust ports. It has a development and diversification programme that enjoys the personal stamp of approval of the Secretary of State. Why, then, do the Government insist on placing all that at risk by forcing through the unwanted privatisation? Will enforced privatisation represent a good deal for the taxpayer?
In 1992, the port of Medway was sold for £29 million, of which £13 million was returned to the taxpayer. Eighteen months later, it was resold for £103 million, representing a loss to the taxpayer of £90 million on the total sale, or £50 million based on the Government's levy formulae. In addition, of the £169 million owed to the Government after the sale of all five trust ports, just £54 million had been recovered by March 1992. In March 1993, by the time the Government caught up with the remaining £114 million that they were owed, the loss of interest amounted to a further loss to the taxpayer of £4.5 million. We can safely discount benefit to the taxpayer as a reason for proceeding with the privatisation of the port of Tyne.
When the Ports Bill was introduced, the then Secretary of State, the right hon. and learned Member for Edinburgh, Pentlands (Mr. Rifkind), placed great importance on the consultation process. He said:
Several hon. Members have referred to the letter from Mr. K. Mori, the senior managing director of Mitsui OSK Lines, in which he referred to his concerns. He values his contacts with the port of Tyne so much that his company has named one of its new container vessels Tyne.
Are the Government truly prepared to put the understanding, trust and levels of inward investment referred to in Mr. Mori's letter at risk because of their ideological dogma? Despite the arguments put by the hon. Member for Hexham (Mr. Atkinson), that is what the privatisation is all about. It is not about making the port of Tyne more efficient, more profitable or more commercially diverse. It is not about providing a good
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"I was just a kid but it was mine--the coaly Tyne."
Tynesiders look on it as their river. They consider the work of the Port of Tyne Authority as work done on their behalf. That is apparently a naive view in the eyes of the
"May we reiterate that it is the view of the majority of our members that the port must remain under its current status and continue to be established as a regional asset.
Warrant Distribution Ltd. says:
We can see no advantages to force on the users of this port, a situation that is purely politically driven without any practical safeguards or protection as to its future."
"We see no justification in commercial terms for privatising the Port at this time, and can only imagine that the Secretary of State's decision is based purely on political dogma."
Apart from the responses from companies such as that, hon. Members from the region--at least Labour Members--asked to meet the Secretary of State to put our objections to him face to face. He did not find time to meet us, but we were given the privilege of meeting a Minister who sits in the House of Lords. We found it profoundly objectionable that the Members of Parliament who attended that meeting, who are natives of Tyneside and the north, should be told by an unelected, hereditary peer that he knew better than the Tyne's elected representatives what was good for the area. Our objections are shared by the overwhelming majority of people on Tyneside.
"There are always grounds for change in the ports industry; the argument is about the nature of that change and the purpose of it."--[Official Report, 28 January 1991; Vol. 184, c. 683.]
That acid test holds true today. Will this enforced privatisation be a change for the better or, as the management, work force and customers claim, a change for the worse?
"it would not automatically follow that other ports falling within the category would be privatised. That would depend on the response of the port and of other local interests."--[Official Report, 28 January 1991; Vol. 184, c. 675.]
Why is the current Secretary of State not showing the same regard for the port and its users? According to his Department's list of representations, 307 were received, of which 292 were opposed to privatisation along the lines currently proposed. The Port of Tyne Authority has received a further 330 representations, of which 315 were opposed to the Government's privatisation.
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