Orders of the Day — Air Corporations Bill

Part of the debate – in the House of Commons at 12:00 am on 2nd December 1963.

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Photo of Mr Frederick Lee Mr Frederick Lee , Newton 12:00 am, 2nd December 1963

Yes, indeed. The Minister then informed us that there had been no discussion of the question of writing off the accumulated deficits. Has he forgotten that it was financial policy, including failure to write off deficits, which Sir Matthew described as "bloody crazy"? Indeed, if there is no policy difference between them, can we take it that he accepts Sir Matthew's description as being the correct one? Perhaps a little more evidence of mutuality between them can be seen if I quote HANSARD of 6th November, 1962. The Minister said: … What I tried to indicate was that to dismiss as 'bloody crazy'"— I like using that in the House— the idea that one should pay interest charges on borrowed capital was not something which in itself commended itself to me. It may well be that in a reorganisation, if a reorganisation should be called for, there would be a case for writing off losses. I cannot say at this stage. But I do not think that there is a natural right on the part of any business, whether private or national, to write off losses such as these."—[OFFICIAL REPORT, 6th November, 1962; Vol. 666, c. 820.] The point that I am making is that when the right hon. Gentleman said that there had been no discussion about this, surely he knew that he had discussed it publicly with Sir Matthew Slattery.

I turn now to current events. Can we be told about the present state of play in the resignation stakes? We know about Sir Matthew Slattery and Sir Basil Small peice, and we suspect that Sir Wilfred Neden may also have gone. What about the activities of the group composed of Lord Tweedsmuir, Lord Rennell and Mr. Lionel Poole? They seem to be opposing the Minister in his determination to sack them. We are entitled to know what is happening—who is to go and what kind of a board we are to have at the end of the night of the long knives, as it were. Indeed, I should have thought that people well beyond the Board of B.O.A.C. are getting rather worried about the activities of the right hon. Gentleman. He is beginning to look every day more and more like a modern vengeance, counting the heads as the guillotine does its work, and I think that the sooner he lets us know where and when this process is to end, the more we can expect stability in B.O.A.C.

Only two points emerged clearly from what the Minister said on 21st November. He denied that there was any crisis of confidence between the B.O.A.C. and the Government—and how relevant this is now—and that there were no policy differences between himself and the chairman. If the utter chaos now obtaining in the Corporation can be achieved by the Minister without either of these things, one's mind boggles at the thought of what would happen if they were present.

I do not propose to spend a great deal of time discussing the White Paper. It seems to be a document the first half of which was written, or could have been written, by Sir Matthew Slattery, and the second half by a number of persons who at some time may have had something to do with the B.O.A.C. or with the world of aviation, but who have been away from such work for some time and whose object in writing it is to justify getting rid of the present management.

The Minister has had a very bad Press indeed. I could give the House many quotations, but I should like to quote from Flight International of 20th November. Reviewing the White Paper it said: That White Paper, a pitifully superficial document, contains scant justification for its assertion that 'there is a need for stronger management'. There is nothing in it to allay suspicion that these men are scapegoats for a Minister who, after wasting 16 months, had to do something politically spectacular. Dealing with the question of financial control, the magazine said: The charge of inadequate financial control is vague. What exactly does it mean? 'Slack budgetary control.' If it does, how can slack budgetary control have cut B.O.A.C.'s cost level from 40d. to 23d. per c.t.m. in six year.?, and reduced the all-inclusive break-even load factor from over 60 per cent, to less than 50 per cent, in the same period? These cuts are not just the fruits of higher-productivity aircraft, but of sheer hard work. It may be added that these figures take account of the cost of operating obsolescent types which other airlines havegot rid of. How can Mr. Amery substantiate his charge of 'ineffective financial control'? That extract is from Flight International and is not something which has been thought up by the Opposition.

I have a number of Press articles, all of which express concern about various aspects of the White Paper, and in particular about the conclusion in paragraph 51. I hope that the right hon. Gentleman will answer some of the points that we make on this conclusion which says: The Government think it necessary to reaffirm that the Corporation must operate as a commercial undertaking. If the national interest: should appear, whether to the Corporation or to the Government, to require some departure from commercial practice, this should only be done with the agreement or at the instance of the Minister of Aviation. That obviously presupposes that commercial practice will, on occasion, be in complete opposition to the national interest; in other words, that B.O.A.C.'s commercial interests will run counter to the national interest. Such occasions will obviously include questions of purchasing policy, for instance, whether B.O.A.C. should buy British or foreign planes. Let us be quite clear about this. This conclusion gives the Minister a complete right of veto over some of the vital decisions which the management of B.O.A.C. is called on to take.

I remind the House that a portion of the B.O.A.C.'s Report for 1962 was omitted on what may, for reasons of politeness, be described as the "advice of the Minister". I referred to this last year and pointed out that the six pages of the Report which were omitted were those which criticised the British aircraft industry, and it was suggested at the time that Part III of the Report, which criticised the aircraft industry, was omitted. My fear is that the Minister is now taking powers of veto over the B.O.A.C. management on purchasing policy and that, because of the precedent which he has set, it is unlikely that the facts will ever be revealed to the House or to the country.

For a long time my hon. Friends and I have been receiving complaints from practically all types of employees in the B.O.A.C.—including some types of management, the organisation to which the pilots belong, office people, and people in the workshops—who are utterly incensed at the kind of thing which is happening in their Corporation. They and I feel that there has been so much interference both by the Ministry and by the Minister that nobody can say that the B.O.A.C. is in fact in the hands of the board or of the executive itself.