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Lord Clinton-Davis: The Minister is always extremely pleasing and helpful up to a point. However, I do not believe that he has gone far enough. I draw a parallel, but one of principle. Perhaps I may deal very briefly with the history of this particular concession made by the Government in the Railways Act. The noble Lord will remember that the Railways Bill was the subject of considerable controversy. The Government met hostility not simply from this side and from the Liberal Democrats, but from a number of their own Back-Benchers, and, indeed, from all round the House.

One of the issues which was sharply focused on was the question of a management and employee buy-out. Frankly, I am not thrilled about it in the context of the railways. I believe that the utmost caution should be expressed by people involved in the railway industry at the present time before engaging in that kind of enterprise. I am not dealing with particulars of the railway industry here, but the principle.

The Government saw fit to provide that there should be some help given to the promotion of MEBOs. They went to the extraordinary lengths of providing that not only a measure of priority but a whole series of financial assistances should be given to the proposed management and employee buy-out so that they could get their act together. Therefore, it is perfectly reasonable to ask, if that was good enough for the railway industry, then why not here?

The Minister says that he does not want to be under any duty. There was a duty here. He says that one cannot consider other precedents because they may not apply. He says that in this case one is not privatising a whole entity, but neither were they doing so in the case of the railways. It was a question of bidding for a franchise, which is very different from going into a complete privatisation.

I ask the Minister to give an undertaking to the House tonight that, in the context of this amendment—on reflection, I should have preferred simply to graft on to it tonight the provision of the Government's own Act, and we may come back on that basis—he will consider his reply in the wider context of looking at that particular section of the Act and will say, "I shall reflect further on the matter". In so doing it does not mean that he has to accede to a MEBO. He would be giving it some assistance as regards its formation, so that it could rival more powerful organisations engaged in a similar enterprise. I ask the Minister to reply to that. I shall withdraw the amendment, but I should like to hear what he has to say in principle about these issues.

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Lord Fraser of Carmyllie: I do not believe that there is much point in pursuing whether the examples given are exact parallels or not. I understand the point that the noble Lord, Lord Clinton-Davis, is making. I repeat that I have some concern about introducing particular rights which might require a degree of inflexibility that would serve no one any valuable purpose. However, I say to the noble Lord—and I hope that this will satisfy him—that I shall be prepared to examine the scope for offering assistance, which is somewhat in the nature of the language to which he made reference; namely, the scope for offering assistance to a management and employee buy-out. But I repeat: MEBOs should compete on all fours with other prospective purchasers. I hope that that is sufficient assurance for the present purposes.

Lord Clinton-Davis: I am grateful to the Minister, but he almost spoiled what he was saying in his last sentence which was in conflict with his own Government's philosophy. In the light of his response, I look forward to returning to the matter on Report and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 34 and 35 not moved.]

Schedule 2 agreed to.

Clause 7 [Disposal by Authority or Secretary of State of shares in successor companies]:

Lord Haskel moved Amendment No. 36:

Page 4, line 13, leave out subsection (1).

The noble Lord said: The purpose of the amendment is to seek some clarification because under the Bill as drafted the Secretary of State is not obliged to act in the national interest. The amendment requires the Secretary of State to be of the opinion that sales of shares in successor companies would promote the national interest.

It is difficult to understand the need for Clause 7(1). Presumably the Secretary of State would not order a sale of shares unless he thought that it was in the national interest. The clause simply allows the Secretary of State to do things that he does not consider to be in the national interest. I should be interested to know whether the Minister can give us an example of what the Secretary of State would do which is not in the national interest. I beg to move.

Lord Fraser of Carmyllie: It is a neat point and the noble Lord clearly enjoys it. There is no question of the Government acting against the national interest. The whole point of Clause 7(1) is to remove any possibility that the provisions of the 1981 Act might be held to limit the powers of sale provided by this Bill and prevent the Secretary of State or the authority from securing the sale of AEA Technology on a basis which they believe best serves the interests of the nation.

As I have said repeatedly in this Committee, the Government are committed to putting AEA Technology into the private sector on the basis which secures the best possible future for the business and its staff, maximises its contribution to UK competitiveness and provides best value for money for the taxpayer. That is what we are working to achieve. That is what we are determined to achieve. Therefore, I reassure the noble

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Lord that in that fabled bottom drawer there is no proposal which is designed to secure a sale which would be contrary to the national interest.

Lord Haskel: I thank the Minister for that reply, but I must confess to being a little disappointed because I had hoped that we would all be enlightened by it. However, in view of the Minister's reply, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 37 to 40 not moved.]

Clause 7 agreed to.

Clause 8 agreed to.

Schedule 3 agreed to.

Clause 9 agreed to.

Schedule 4 [Pensions]:

8.45 p.m.

Baroness Turner of Camden moved Amendment No. 41:

Page 29, line 3, leave out ("sub-paragraphs (2) and (4)") and insert ("sub-paragraph (2)").

The noble Baroness said: We now reach a group of amendments on pension entitlement. In moving Amendment No. 41, I should like to speak also to Amendments Nos. 42 to 46, 46A and 49. This group of amendments is intended to allow UKAEA employees to remain in their pension schemes after privatisation. The amendments are similar to a series moved in Committee in another place. They were opposed by the Government then and I hope that in the intervening period there has been time for the Government to think again. The reasons advanced for opposing them then were far from convincing.

As we know, we are talking about a sophisticated and highly trained workforce. It is usual in such circumstances for employees also to be committed to their pension scheme and to value their scheme membership very highly. As I understand it, the scheme is a fairly standard public sector scheme. The benefits are reasonably good and, among other things, contain provision for complete indexation of pensions in payment. I understand that the Government's argument is that it is not government policy to allow membership of the scheme to continue. It is, however, said that the benefits provided will be "equivalent", whatever that may mean. It certainly does not seem to mean that they will be the same. Indeed, I believe that full indexation may not be envisaged. This is an important point.

The staff who joined the authority became civil servants. They knew that they would be doing so and therefore expected, as part of the package, that they would be members of a public sector scheme guaranteeing certain benefits. I cannot stress too strongly that many people nowadays—perhaps always as far as this type of employment is concerned—structure their lives very much on what they may expect to receive when they retire. Until recently, it had always been public perception that such Civil Service jobs, although perhaps not as lucrative as many in a more entrepreneurial environment, had the compensating

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factor that there was security both in regard to the employment itself and in relation to ultimate retirement benefits.

However, along came the Government with wide-ranging plans to privatise. That sense of security disappeared almost overnight. Removing the right to remain in the pension scheme after privatisation is therefore of considerable detriment. The Government may argue, as they did in the other place, that there will be provision of an equivalent standard. That is not good enough when many people fear that they may lose the vital element of indexation. I understand that continued membership was allowed some years ago when Amersham International was privatised. I gather that the Government argue that most of Amersham International's employees eventually opted for transfer to the private sector AI Pension Scheme. That may well be so, but it was a matter of choice for the individuals who had the opportunity of looking at the relative benefits.

According to what has already been said, the Government do not intend that to happen in this case. I think that that is wrong. I remind the Government—my noble friend Lord Clinton-Davis has already done so in relation to other aspects of the Bill—of the problems that they encountered over pensions when railway privatisation was under consideration in your Lordships' House. Eventually the Government had to shift from their original position and make some concessions. I hope that they may be persuaded to do so in the present case. I beg to move.

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