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Lord Fraser of Carmyllie: My Lords, when we discussed almost identical amendments at Committee stage I gave an indication that this set of amendments would give trade unions and staff associations a veto. Perhaps I went too far in saying that, but it would give them an automatic right of consultation before the Secretary of State was able to exercise his powers in relation to transfer schemes and before either the Secretary of State or the authority could dispose of any of the securities in a successor company.

At the risk of repeating myself, our position remains that the final decision on the sale has to be made by the Government in the light of market circumstances at the time and in the best interests of AEA Technology as a business, its employees and the taxpayers. We could not accept a clause which might affect the ability to take that final decision. When we debated the amendments in Committee I believe the noble Lord, Lord Haskel, stressed that they were intended to ensure that best employment practices were carried out. He said that that was of particular importance in a "people" business such as AEA Technology and that the staff were carried along with the privatisation proposals. I entirely agree with both his propositions. All the privatisations that have taken place were of "people" businesses, in which that is pre-eminent.

I did not engage in the type of negotiation and discussion which the noble Lord, Lord Peston, described—and which he tried to discover—when I was at Harwell last week. However, I spoke to the chief executive and had displayed to me the wide range of consultation material that he and his chairman had undertaken in recent months. I can assure the noble Lord that it is as extensive an exercise in consultation as I have seen. My understanding is that it is by no means at an end and that the management intends to continue to consult with those whom it employs and to take them along with all that is being proposed. That seems to me to be the right way forward. With that reassurance, I hope that the noble Lord will appreciate what is being undertaken and will feel that he can withdraw the amendments.

Lord Peston: My Lords, I thank the Minister for his reply. I reiterate that I do not believe that it would be right, and in particular not constitutionally right, for there to be a veto. I am certain that the amendments do not give the workers, the employees or their representatives a veto. My judgment is not very different from that of the Minister that, to use his words which are better than mine, it would be good sense to carry one's employees along with one. I believe that that is what he said. The way to do that is to consult them and to have a meeting of minds. The Minister says that in his judgment that has been happening and in a way my amendments are unnecessary. Since he said that, and it is on the record, I assume that the people at AEA Technology can read and will read what he said, just as they might consider reading what I have said. I know that every word spoken on this side is read by them at all times!

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However, this is a serious matter because, to return to my point on economics and finance, the productivity of the enterprise, and therefore its value in the market place, depends overwhelmingly on the employees believing that what is happening is correct and that they are properly valued. That is the whole point of the amendments and I do not believe that the Minister disagrees with me about that.

I am a little sorry to hear that he did not have a chat with those people and not even a drink with them, but I know how busy one can be. He may well visit Harwell again, but I am sorry that he did not speak to some of the employees. I have elucidated the substance of this group of amendments, as I wished, and, therefore, I have no difficulty in withdrawing the amendment.

Amendment, by leave, withdrawn.

Clause 3 [Supplementary provisions as to the Authority's powers]:

[Amendment No. 9 not moved.]

Lord Clinton-Davis moved Amendment No. 10:

Leave out Clause 3.

The noble Lord said: My Lords, the purpose of Amendment No. 10 is to challenge Clause 3; we say that it should not stand part of the Bill. Clause 3 states:

    "Without prejudice to any powers of the Authority apart from this section, the Authority shall have power to do anything which in their opinion is appropriate for the purpose of facilitating ... any transfer effected or proposed to be effected under section 1 of this Act, or ... the disposal of securities of a successor company".

I wish to put the matter in the correct context. Since 1954, when the UK Atomic Energy Authority was established, it was specifically given a wide range of powers. That was wholly appropriate because it was a large organisation undertaking research and development in terms of producing and using atomic energy and distributing information about atomic energy. It also later encapsulated in its work scientific research on subjects which were unconnected with atomic energy: for example, the treatment and disposal of waste, and trading in intellectual property.

When the Bill takes effect, the Government Division will remain as the UKAEA. It will employ about 2,000 people. The UKAEA Government Division Forward Plan 1995 to 2005 was agreed by the DTI in March this year. Its purposes were described in that document as:

    "To complete the UKAEA nuclear mission, whilst rapidly reducing the annual cost to the UK taxpayer of Government Division, by:

    Caring for and, at the appropriate time, safely dismantling active facilities no longer in use.

    Disposing of radioactive waste in an environmentally acceptable way.

    Making use of those UKAEA assets which cannot be disposed of, including live active facilities.

    Always ensuring that the programme is carried out at lowest economic cost consistent with safety and environmental requirements and acceptable financial risks".

Clearly, if the Government are to go down that path then the UKAEA will not require as many powers as are currently enjoyed by that organisation. I wish to know whether the Government have any plans to rescind any such unnecessary powers, following privatisation. The Government would accept that it is unwise—I am not sure that they will accept it but we take the view that quangos should not have greater powers or greater

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authority than they absolutely need. The UKAEA may be tempted to duplicate some of the work of the AEAT. That would represent unfair competition for the latter, because the UKAEA will be government funded. One also has to ask whether that might represent a potential collision with the provisions of the Treaty of Rome as regards state aids.

I could cite many powers and authorities but I shall merely mention the Acts under which they have been conferred: the Atomic Energy Authority Act 1954, the Science and Technology Act 1965, the Radiological Protection Act 1970, the Control of Pollution Act 1974 and the Atomic Energy Authority Act 1986. I should be happy to pass over to the Minister the specific references which I have just made by implication for his better understanding of the matter, although I am sure he is well briefed on the issues.

I wish to know whether the Government intend to review the powers needed by the UKAEA after privatisation. Will they put forward amendments to the provisions of the Acts to which I referred? Perhaps I may delicately pass to the Minister the specific sections to which I referred, if he needs them. I think they will enable him to see the point that I am making. I do not want to weary the House. If the Minister wants to ask me any questions about it, I am afraid that I shall have to ask him to hand back the document as I could not answer without reference to it. I have all the various enactments before me.

I raise this point by way of interrogation. It is important, so perhaps the Minister will be kind enough to deal with it. I beg to move.

4 p.m.

Lord Fraser of Carmyllie: My Lords, I listened carefully to what the noble Lord said. This provision may be widely drawn, but it is certainly not my understanding that it is intended, as it were, to extend the range of the powers of the authority, other than in relation to,

    "any transfer effected or proposed to be effected under Section 1 of this Act".

Clause 3 would enable the authority to prepare a transfer scheme or dispose of securities in a successor company. In that respect it is analogous to the paving powers to be found in earlier privatisations. It merely puts beyond doubt the authority's power to take the necessary steps to organise itself in preparation for the making of a transfer scheme. Removing this clause would complicate and delay the process and lead to unnecessary administrative costs. I cannot see that anyone would consider that to be a desirable objective.

I hope therefore that the noble Lord will be satisfied as to the purpose of the clause. In view of his questions, however, let me go a little further. There are certainly no present plans to change the powers of the UKAEA as set out in the 1954 Act or any other statutory provisions. The clause deals with a scheme under Clause 1. As I am sure the noble Lord is well aware, the provisions of Clause 1(3) indicate the extent of the limitation on what can be transferred as part of the authority's responsibilities.

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Lord Clinton-Davis: My Lords, with respect, the Minister has not dealt with the point that I raise as a matter of substance; namely, that in the light of the role that is to be undertaken by the UKAEA in the future it would seem to have powers greater than it needs. The Minister may wish to reflect upon that, and I should not complain about that at all. The point has perhaps not been made with sufficient clarity simply as a result of the amendment. I should like to hear from the Minister as to whether he is prepared to consider the issues that I raise before Third Reading, so that we know whether there is substance in my remarks. I feel that there is. We do, of course, have the right to move amendments. I do not say that we would wish to challenge the Government over this point; it would simply be a matter for explanation. In the light of my remarks, perhaps the Minister will indicate whether he is prepared to write to me so that I may consider the position afresh before that stage of the Bill.

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