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Mr. John McDonnell (Hayes and Harlington): I speak from a constituency interest, as well as from a party interest, I suppose. Heathrow is in my constituency. Many of my constituents live under the flight paths. Many of them work at Heathrow, so I have a direct constituency interest and in no way apologise for raising the issue of safety again.
Not a single constituent in my constituency with any involvement in the aviation industry supports the proposal. I have consulted at length within my community. I have met not just trade unions, but members of the community who have worked in the industry for a long time as individuals. I have met air traffic controllers.
We gave commitments before the last general election. Letters went to some of my constituents informing them that the air was not for sale. They believe that a singular act of political disingenuity is being done today.
Air traffic controllers in my constituency have served the country well. They have given us possibly the safest form of transport over the years and the safest aviation industry in the world. Our amendments seek to retain
NATS as a public service in some form. They try to commit us to the promise that we made before the last general election.The proposal will enable NATS to operate within a commercial structure that will provide the commercial freedom that the Government seek and that the Deputy Prime Minister considers desirable. It is not an argument for the status quo. We have already dealt with that discussion. We all accept the split between the CAA and NATS. It is a compromise; both the IPOC--the independent publicly owned company--and the trust are compromises. It is a desperate plea from me and from many of my comrades and constituents.
Last Thursday, at the London elections, I met lifelong Labour supporters who were not voting Labour for the first time in their lives. We had a virtual strike among campaign activists because we had stopped listening to them. The amendments are a plea to the Deputy Prime Minister and others to listen to what our people are saying. They do not want any further privatisations. No matter how much we try to dress this one up--I have put the arguments--whether it be as a part sale, a public-private partnership, the introduction of commercial disciplines and incentives or whatever, the general public and Labour supporters in particular throughout the country view it as a privatisation and--I echo what has been said--a privatisation too far. They are right because, as has been said, we now find that, in the legislation, the potential private sector stake is not restricted to the initial allocation of shares.
When we discussed that before, I was anxious about only 49 per cent. being retained by the Government. Five per cent. was to go to staff and 46 per cent. to the private sector, but, in future, according to the legislation, there will be no restriction on the privatised NATS issuing further shares to raise finance. The only bottom line on the eventual size of Government shareholding is 25 per cent. At that point, 70 per cent. of shares will be in the hands of the private sector. I call that privatisation; I believe that most people will believe that it is full privatisation.
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As for employee shareholding, yesterday, in a letter from Lord Macdonald, we were informed:
- Staff shares can only be sold to other staff or a staff trust.
After a certain time, 75 per cent. of the shares could be in private hands. The private hands could be those of the private sector strategic partner that the Deputy Prime Minister has prayed in aid in supporting the legislation, the Airline Group. Eventually, that group could possess control.
Mr. Peter L. Pike (Burnley): Is my hon. Friend aware that, when the Trustee Savings Banks Act 1985 was passed, certain time-limited safeguards were provided on the maximum size of any one shareholding? Once those safeguards lapsed, the entire shareholding situation changed, and, very rapidly, TSB went with Lloyds.
Mr. McDonnell: My hon. Friend is an experienced Member. He makes a valid point and offers a history lesson that we should all bear in mind as we debate the proposal.
As I said, the Airline Group has been prayed in aid in support of the proposal. Of course it supports the proposal. It could gain control not only of the NATS company, but of the air itself. A few months ago, in The Observer business section, a leak revealed that the beneficent, altruistic Airline Group, which wants to become the key shareholder under the proposal, has initiated a discussion on how the airlines comprising the group could receive preferential treatment and access via NATS, which they would jointly own and control. I believe that the Airline Group is proposing a physical and financial cartel. The legislation, however, contains no provision to prevent such a cartel from being created.
Interestingly, yesterday's letter from Lord Macdonald reveals that, although the Government are willing to countenance a NATS board where the private sector may have 75 per cent. control, there will be no representation on it for trade unions. Instead, trade unions will be offered a stakeholder consultative council in which they will be but one interest among many. That is not a partnership, but a sell-out. It is a takeover.
I make no apology for raising the safety issue. After the railways were privatised, we had Southall and Paddington, which is down the track from my constituency. I lost constituents. Those disasters put beyond doubt the link between privatisation and public safety. The public sector should have the preponderant role in guaranteeing public safety. In the past fortnight, we have even had reports of complaints about private bus companies' safety policy in recruiting drivers.
In this debate, we have discussed balances of proportionality in safety. Just to put it beyond doubt, the fact is that those who know the aviation industry tell us that there are doubts about safety in the private sector. In 1999, the Environment, Transport and Regional Affairs Committee reported on aviation safety, and it drew the Government's attention to the safety risks posed by commercial pressures in the aviation industry. I invite hon. Members to read that report, which states:
- in spite of the protestations of the airlines that "safety [is] our most important priority . . . [we] do not seek competitive advantage as far as safety is concerned", concern remains that in the event of conflict between safety considerations and profit margins, airlines may favour their profit margins.
In theory--let us get the theory right--there is a view that commercial pressures within a privately owned company create risks to safety. It does not require a great theoretical leap to understand why. A private company's first priority is profit; every other factor is secondary and short term. The public-private partnership needs to produce a return for its shareholders. The company will not be able to increase charges, so profits can be maintained only by reducing costs, which entails reducing staff and cutting equipment.
The Government do not accept that that creates a risk. However, when I take off in an airplane with my family, I want to hear reassurances about safety not from the Deputy Prime Minister, but from pilots, backed up by professional air traffic controllers. Those who are strongest in opposing the proposal are pilots, air traffic controllers and our own Transport Sub-Committee.
It is not as though the Committee has not had a good go at this type of proposal. Year after year, we have had reports--they could not have been more categorical--
advising the current Government, and the previous one, that this proposal is the worst possible option. It is the worst because it privatises part of the regulation system. Air traffic controllers are a part of that system--keeping people apart and dealing with commercial competition between airlines--but we are selling them out.As has already been said today, no other country has privatised its air traffic services. The Government have seized on the comments of a visiting Dutch Minister, who said that his country may consider such a proposal and that it is an interesting option. Pardon me, but I do not think that that constitutes an international riot clamouring for privatisation.
The Government have circulated detailed notes on discussions on safety that were held last week between unions and the Government. I am grateful for them, but I also note that they show that the unions refused to sign up to the proposal or to state that they were satisfied about safety. Today, they have reiterated in their briefings to us that they do not support the proposal, which they believe will increase risk to the travelling public.
Let us be honest with people. How did the proposal arise? It was made because, in the previous general election campaign, the Tories found a black hole in our budgetary plans. The telephone call went out to each Front-Bench team to find a few hundred million, and the proposal was plucked out of the air. Let us not kid ourselves about it. The proposal is a political disaster and, potentially, a physical disaster.
My constituents are the ones who are most at risk. They will never forgive a Government who put dogma before their safety. As has already been said, those who have attacked my constituents for their opposition to the proposal have attributed to them two motives, the first of which is industrial. However, the fact is that my air traffic controller constituents are passing up a £13 million handout because they want to keep the skies safe.
Ideology is supposed to be the second motive for opposition to the proposal, but I say that ideology is forcing the proposal on us. There are now some Labour Members who think, "Public sector bad, private sector good." As a previous leader of our party said, when theory gets pickled into dogma, we wind up with a Labour Government privatising our air.
Brian Cooper was one of the train drivers who died at Paddington. He was my constituent. Based on my memory, I will never support a further privatisation. I will vote for this group of amendments.
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