Previous Section Back to Table of Contents Lords Hansard Home Page

Lord Rodgers of Quarry Bank: My Lords, I thank the noble Earl for giving way. The question to which I referred in my remarks was Question 441. The question to the Deputy Prime Minister was: "This was your personal decision?". His reply was: "Yes". In the view of the Deputy Prime Minister he made that decision alone.

I also ask the noble Earl, since he raised the matter, if the decision was made last September, as the Deputy Prime Minister said, what discussion there was in either House of Parliament before that decision was made.

Earl Howe: My Lords, I think the noble Lord knows the answer to that question. It is clear how the parliamentary process has operated since the Government made their first announcement. My point was that this is a matter which Parliament has had ample

25 Jul 1996 : Column 1572

opportunity to consider. Bearing in mind that it is not a matter which needs to come before Parliament in the first place, I believe that the Government have behaved entirely fairly in allowing Parliament to express its view. That has been a valuable process, as I indicated.

Lord Beloff: My Lords, is my noble friend the Minister seriously saying that a major departure from a central principle of the British Constitution is not necessarily a matter with which Parliament should be concerned?

Earl Howe: My Lords, if my noble friend had been listening to my earlier remarks, he would have heard me express the view that I do not believe that this is a major constitutional departure.

Lord Beloff: My Lords, I thank the noble Earl for giving way. If the noble Earl, as he said, has been listening to the debate--indeed, to both debates in this House--he will have learned that that opinion is the opinion of many senior and respected Members of this House from all parts of the Chamber. He may hold his individual opinion. It is not the opinion that has been voiced in your Lordships' House.

Earl Howe: Let me address the opinion that has been voiced in your Lordships' House. My noble friend Lord Beloff made a very powerful speech, in which I believe he said that the Government were guilty of blurring the distinction between the public and private sectors. I disagree profoundly with that analysis. What we have seen over the past few years in terms of the reduction in the size and scope of the public sector has been of immense benefit to this country. Time and again the decision to privatise has been vindicated. The result is that we have set an example which others around the world are following with enthusiasm. To say that we are destroying the concept of the British state or blurring the division between the public and private sectors is the very antithesis of what the Government have been doing.

Leaving aside RAS for the moment, we have left behind the days of endless subsidies to loss-making state-owned enterprises. Gone are the days in the water industry and the telecommunications industry, for example, when the state was the regulator of standards. The separation of roles, the redefinition of the boundaries between public and private sectors, have been good for the taxpayer, good for the consumer and a thoroughly healthy thing for this country.

Baroness Park of Monmouth: My Lords, does my noble friend draw n distinction between nationalised industries, about which he has been speaking, and the permanent Civil Service serving the Crown? Does he make no distinction between those two kinds of body?

Earl Howe: My Lords, my noble friend ignores that we are not talking about the privatisation of the Civil Service. We are talking about the privatisation of a recruitment agency which performs an important, although very narrowly defined, operational role. That I think is the distinction that should be re-emphasised.

25 Jul 1996 : Column 1573

Those who accuse the Government of dogma in these matters sometimes speak as though they believed that the boundaries of the state sector were sacrosanct and should remain immutable. If that itself is not dogma then I do not know what is. The noble Lord, Lord Taylor, asked what the rush was and why could we not allow more time. The future of RAS has been under consideration since the beginning of 1994. It was on the basis of this long consideration that we came to the view that privatisation was in the best interests of all concerned. The matter has now been further examined by the committee, we have found this valuable and we have responded fully to it. Further delay would not be in the interests of RAS or indeed its staff.

The noble Lord, Lord Rodgers, referred to the evidence given to the committee that there were no policy issues left to decide. Let me simply say this. While I would say that there were no significant policy issues left to decide, the decision on value for money to which I have already referred can only be finally decided when the final bids are assessed. In addition I would say to him that changes to the contract have been made and further changes are being made as a result of the committee's work.

My noble friend Lady Park questioned the adequacy of the security arrangements in private companies. I suggest to her that that is a complete red herring. As she knows well, there is a whole host of private companies handling sensitive government information. The arrangements for RAS have been considered very carefully in consultation with all fast-stream customers. They are content with the safeguards in the contract.

The noble Lord, Lord Chorley, indicated his opinion that the Government would lose control of intellectual property rights which would become merged with those of the new owner. In fact the Government will retain ownership of all intellectual property in the fast stream, including tests and exercises developed by the new owner on their behalf. The arrangements protect these and ensure that the integrity of the Civil Service selection is not threatened.

The noble Lord, Lord Wallace indicated that there would be additional costs from privatisation and enhancing the intelligent customer function. We shall of course take account of all additional costs in setting value for money, as I said earlier, and this will include modest increases in resources required for the intelligent customer unit to which my noble friend referred in his initial speech. It will be that unit which manages the main fast-stream contract. There will not be a contract manager in addition, nor will additional resources be required in customer departments. There will be no increase in costs as a result of the continuing involvement of civil servants in the process.

The committee's report concludes that in its opinion the privatisation of RAS is undesirable and unnecessary. It bases that view on concerns raised that the service to the public sector might deteriorate. However, as we have discussed today, the Government agree, either in spirit or in detail, with all but one of the committee's detailed recommendations.

25 Jul 1996 : Column 1574

I cannot pretend that the committee's main conclusion is not disappointing. We believe quite simply that the business, once privatised, will be able to improve its services to its customers in the public sector and that it should be given the opportunity to do so. Expanding into new markets and increasing its share of existing markets will enable RAS to spread its overheads over a broader cost base. In the private sector the business will be free to consider the investment necessary for expansion into new markets.

The issues at the heart of the broad philosophical debate--the merits of privatisation, enterprise and wealth creation--are ones which your Lordships have discussed at some length on earlier occasions. The committee readily acknowledges that its remit was not to consider those issues and few of your Lordships, I venture to suggest, will have expected them to be resolved today. Better therefore that we conclude this debate by laying emphasis on where the Government's and the committee's opinions are in harmony.

As has been said many times, RAS is a centre of excellence in providing recruitment and assessment services to the public sector. The Government's clear view, as presented to the committee, is that once privatised RAS will be free to build on that reputation; to develop and expand its services. The committee's concern was that there should be no detrimental impact to the public service from privatisation. The Government share that concern. The key to maintaining the standard of service provided by RAS will be the safeguards which both the Government and the committee believe should be put in place and which will be put in place.

That is why I suggest that we can be confident that privatisation will deliver what we all want to see; that is, benefits to the business, its customers and the taxpayer. I am sure that we all wish RAS and its staff well in the important work ahead.

2.41 p.m.

Lord Slynn of Hadley: My Lords, I thought it appropriate, when introducing this report to the House, to do it in low key--what I believe the noble Lord, Lord McIntosh, would describe as a "non-ferocious" way. That seems to me to be the task of the chairman of the committee.

I am grateful to all noble Lords who participated in what has been a valuable and constructive debate. Obviously at this hour it would be inappropriate for me to repeat or comment on many of the suggestions and ideas put forward. However, I want to deal briefly with two matters.

The first is the point raised by the noble Lord, Lord Cuckney, who said that the cart had been put before the horse. I agree with him. But in the circumstances the House and the committee had no choice but to get on and deal with the matter in the time made available by the Government. I do not for a moment accept that the limitation on the time meant that this was bound to be a superficial or ill-considered report. On the contrary, much of the written evidence we received was clearly well thought out, well reasoned and based on considerable experience.

25 Jul 1996 : Column 1575

As I said in opening, we could have had more evidence. I am not sure how valuable the headhunters would have been. But the House should not be under any misapprehension about this. Headhunters were invited to come and either did not reply or told us that they could not give any evidence in the time available. It may well be that the British Airways evidence given to us is different from that to which the noble Baroness, Lady O'Cathain, referred. But it seems to me to be quite astonishing that nobody on the committee felt that the head of recruitment of British Airways was not a suitable person to tell us what were the recruitment processes of British Airways. If that was so I recognise and acknowledge the decision arrived at by the noble Baroness, Lady O'Cathain, in her speech in the debate in the House, that on the evidence before us the case was not made out. And that was our task.

My second point is a different one. I am grateful for all that was said by the noble Viscount the Lord Privy Seal in dealing with the detailed recommendations of the committee. But that was very much on the periphery of our inquiry. As I said in opening, the central question was whether we thought that a case had been made out to privatise RAS. It was to privatise RAS, not the Stationery Office, the environmental health or occupational health authority and not any trading company, but this very particular part of the public service. Our task was not to ask whether, as the Minister has just said, RAS would expand and grow fat and rich, but for whose benefit, if any, in the public sector this change would take place.

I was extremely grateful to hear the maiden speech of the noble Lord, Lord Gillmore of Thamesfield. It was as great a delight to listen to his elegant and thoughtful speech as it was of value to have him as a member of the committee. But at the end of the day, apart from these questions of detail, I am left with a very clear impression that the committee came to the right conclusion on objective grounds. I did not hear today any reason for the privatisation of RAS, which in any way went beyond what we heard in evidence in our committee. Indeed, the Government's reply reminded me of the days when, as a station duty officer, one was told that there was to be a visit the following week by the air officer commanding. The routine instruction was, "If it doesn't move, paint it". I had the feeling at the end of the speeches of both Ministers today, as I did when we took evidence in committee, that the policy is, "If it is there, privatise it". For my own part I am quite satisfied that in its report the committee came to the right conclusion. I very much regret that the Government have not given more weight to that recommendation.

On Question, Motion agreed to.

Next Section Back to Table of Contents Lords Hansard Home Page