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Lord Sainsbury of Turville: As this is a question of the powers that the Government would have in these circumstances, it seems strange to allow this power as a possibility and then to delay it. Nothing would be gained by delaying the use of the power, given that we can debate it and consider the issues at this stage. It would become a reality only in particular circumstances. I can see no harm in saying that, under those circumstances, we should have the powers in place.
When nuclear safety is at stake, it is unacceptable for the Government to stand idly by in the hope that the BE situation will somehow go away. We are keen for the restructuring deal to succeed, but it would be truly alarming if we were not ready for a situation in which the deal failed. Paragraphs (b) and (c) of subsection (1) allow the Government to ensure that they are ready for every eventuality. Their removal would damage the Government's ability to meet their obligations to ensure continuing nuclear safety and security of supply.
The noble Lord said: As we discussed at Second Reading, Clause 2 widens the Bill beyond the question of British Energy. We may have our own ideas as to why that is necessary, as I hinted in my Second Reading speech. The Minister for Energy and Construction was splendidly frank at Third Reading in another place, when he said that a Bill could not deal with one company alone. If it had attempted to deal with one company alone, it would have been hybrid.
Amendment No. 8 is comparatively narrow. Although its wording may be open to suggestion and improvement, it makes it perfectly clear that it refers to the sale between a "willing buyer" and a "willing seller". A willing seller is one which is not being put under any constraints or pressure to allow the Government to acquire rights to subscribe to securities in the company. It is a comparatively short and simple question. I hope that the noble Lord, Lord Sainsbury, will give an equally straightforward and simple answer that there is no intention to have a clause which could allow the Government to acquire forcibly or by compulsory purchase the securities in any company. I beg to move.
Baroness Miller of Hendon: My noble friend Lord Jenkin explained very well what is meant by a willing seller and the difference between a seller under slight coercion and someone who is willing to sell. We support the amendment.
Lord Tombs: I, too, support the amendment. It seems to me utterly unrealistic to speak of a "willing seller" when the other party in the purported transaction controls regulation and fiscal matters and is, therefore, in a position to dictate the terms on which the "willing seller" comes to the table.
I do not like the manner in which this matter has been introduced. A certain amount of suspicious attention is required in order to realise what the clause enables the Government to do. To "smuggle" this provision into a Bill dealing with British Energy is less than fair to Parliament. Provisions of this kind should at least be subject to affirmative resolution but, preferably, the subject of separate legislation.
Lord Sainsbury of Turville: Clause 2(1) repeals Sections 72 and 74 of the Electricity Act 1989, provisions which prevent the Government from buying shares in certain electricity companies and their successors. The repeal of those sections would restore the natural position of the Crown's powers to purchase shares in affected electricity companies.
I explained at Second Reading the Government's motivation for repealing those sections. If the restructuring deal fails and the company goes into administration, the Government have to be ready to acquire the stationseither by directly acquiring the
In that case, the Government would need to stand ready to acquire the stations. This is no compulsory purchase. It is simply the Government being prepared to act as a purchaser of last resort if no other buyer steps forward.
Amendment No. 8 proposes that we specify in the Bill that any securities acquired must be "from a willing seller". But that is unnecessary. The repeal of Sections 72 and 74 of the Electricity Act 1989 does no more than restore the Crown's natural powers to purchase securities in certain electricity companies. I must stress that the repeal of these sections does not give the Government a special power to take shares away from shareholders against their will. Essentially, the Crown will be placed in the same position as any other individual and be subject to the same constraints. We could acquire the shares only where a shareholder was prepared to sell.
Therefore, the amendment adds nothing, except some possible confusion as to exactly what a "willing seller" is, as that is not an established concept. There is no hidden agenda to renationalise electricity companies. The Government simply want to ensure that the Crown's natural powers to buy shares in certain companies are restored in order that the Government are able to stand ready to acquire BE stations if that is necessary.
Sections 72 and 74 of the Electricity Act 1989 now have a curious power in terms of which companies they protect. There is now no logic to that because the sections relate to the companies which were then existent. Events have moved on since those days. I therefore ask the noble Lord to withdraw his amendment.
Lord Jenkin of Roding: I must say that I am now less inclined to withdraw the amendment than I might have been when I started. Half of the Minister's reply related to the need to buy securities in British Energy. But we dealt with that issue in Clause 1; and I moved the amendment to suggest that it should perhaps be subject to more parliamentary restraint.
Lord Sainsbury of Turville: As a matter of correction, we have not dealt with the situation because, unless Sections 72 and 74 are repealed, they would restrain the Government from making the purchase which they have the power to make under Clause 1. It is incorrect to say that this issue has been dealt with under Clause 1.
As the noble Lord, Lord Tombs, rightly said, because of the way in which regulators can workor are not workingthe market is subject to the considerable turmoil described by international bodies. Some companies have fallen into grave difficulties. Hitherto, the Government have been precluded from buying securities in those companies. The Bill removes that constraint. I find this an extremely difficult addition; it is tagged on to a Bill which is supposed to deal solely with the problems of British Energy.
As has been repeatedly reported in the press, as a result of the 40 per cent fall in wholesale electricity prices, other companies have found themselves in considerable difficulty. Why does this clause not mean that the Government are now taking the power to acquire securities in any of those companies? They might be quite pleased to be taken over by the Government if they have got into difficulties and the Government do a deal which saves something for the shareholders. Is that what the Bill is about? That is not how it has been presented to Parliament, either in this House or another place. But that is what Clause 2 says and we should not let that go.
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