B.O.A.C. (VC 10 Aircraft)

Oral Answers to Questions — Ministry of Aviation – in the House of Commons at 12:00 am on 3rd June 1964.

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Photo of Mr John Stonehouse Mr John Stonehouse , Wednesbury 12:00 am, 3rd June 1964

asked the Minister of Aviation (1) what approval he has given for compensation to be paid for the cancellation of VC 10 aircraft by British Overseas Airways Corporation to the British Aircraft Corporation; and what is the amount per aircraft;

(2) what liability Her Majesty's Government are accepting for compensation to the British Aircraft Corporation for the reduction of the British Overseas Airways Corporation's order.

Photo of Mr Jack Diamond Mr Jack Diamond , Gloucester

asked the Minister of Aviation how many VC 10 aircraft British Overseas Airways Corporation now propose to take out of the original order of 45.

Mr. Lee:

asked the Minister of Aviation whether he will make a statement on the future VC 10 requirements of the British Overseas Airways Corporation.

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

asked the Minister of Aviation (1) if he will consult the Secretary of State for Defence with a view to diverting some of the 42 VC l0s ordered by the British Overseas Airways Corporation to the Royal Air Force;

(2) if he will give an assurance that the unemployment position in Northern Ireland will be taken into account when considering the diversion of surplus British Overseas Airways Corporation VC l0s to the Royal Air Force as an alternative to ordering Belfast Freighters from Short Brothers and Harland Limited.

Photo of Mr John Cronin Mr John Cronin , Loughborough

asked the Minister of Aviation how many VC 10 aircraft will now be required by the British Overseas Airways Corporation; and what financial arrangements will be made with regard to VC 10 aircraft ordered in excess of the Corporation's requirement.

Photo of Mr Julian Amery Mr Julian Amery , Preston North

I have nothing to add to the Written Answer I gave to the hon. Member for Wednesbury (Mr. Stone-house) on 13th May.

Photo of Mr John Stonehouse Mr John Stonehouse , Wednesbury

Is the Minister aware that the reply which he gave before the Recess was quite inadequate in that all he said was that he was giving consideration to the Question? Is he prepared to deny that the original order which B.O.A.C. made for the VC 10 is being substantially reduced, and that the original order was made as a result of Ministerial direction? Arising out of this, what responsibility does the Minister accept for compensation to be paid to the manufacturers who are losing the order received originally from B.O.A.C.? Will he answer Question No. 8 on liability?

Photo of Mr Julian Amery Mr Julian Amery , Preston North

The hon. Member is anticipating a number of matters. Had I been in a position either to confirm what he said or deny it, I should have done so. I have given the answer which I have given because all this is still under consideration in the Corporation and is a matter of discussion between the Corporation and my Department.

Mr. Lee:

Does the right hon. Gentleman agree that Sir Giles Guthrie has undertaken a route study and that, as a result of that study, we shall know whether there is to be cancellation of some VC l0s or whether some of the Boeings will go? Will the right hon. Gentleman say that he will undertake to let the House know the contents of Sir Giles Guthrie's Report and that he will make a statement in the House about it, and that within it we shall know whether compensation is to be paid and how many VC l0s are being laid off, in order that we may judge whether the compensation is fair?

Photo of Mr Julian Amery Mr Julian Amery , Preston North

The hon. Member has asked a number of questions. Plainly we shall have to tell not only the House but the Corporation what Sir Giles intends. This is something which I shall have to tell the House when we deal with the accumulated deficit. But I hope to be able to make a statement well before that.

Photo of Mr Jack Diamond Mr Jack Diamond , Gloucester

In these circumstances, is it not the case that we shall possibly be denied the opportunity of discussing the matter at all in this Parliament? Was that one of the elements entering into the consideration which the Minister has given to this matter—that this is the last Question Time when he will be top of the list before this Parliament ends?

Photo of Mr Julian Amery Mr Julian Amery , Preston North

I am told that it is not the last occasion. It is possible that this consideration enters into the hon. Member's mind, but it does not enter into mine. Apart from that, I naturally wish, as I am sure does Sir Giles Guthrie, at the first opportunity to tell the House, the Corporation and the country what is intended.

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

When the Minister talks about telling the House at an early opportunity, will he give the House an assurance that he will make a full statement upon all the issues involved before the House rises for the August Recess? Will he then be able to tell us what consultations he has had with the Minister of Defence with respect to transferring some of these aircraft to the Royal Air Force, and other matters which I have raised in my Question?

Photo of Mr Julian Amery Mr Julian Amery , Preston North

The hon. Member realises that it is not my task to decide the policy of the Corporation in these matters. I have to receive a recommendation from the Corporation. I hope that I shall be able to make a fairly early statement about it, but there are a number of considerations, some industrial, some affecting the Corporation, which the Government will want to consider in detail. Defence matters may be raised, as the hon. Member said. I cannot give an undertaking on when I shall make the statement, but I should like to make it as soon as possible, because there are a number of seriously interested parties who want to know.

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

While appreciating that my right hon. Friend will need time to come to the right conclusion in this matter, can he in the meantime say whether or not the Government directed B.O.A.C. to order the number it ordered? This should be cleared up. In view of the importance of this whole matter, will my right hon. Friend consult the Leader of the House with a view to making a special statement, or perhaps having a short debate, because many millions of pounds are involved and this is a matter of debating a policy?

Photo of Mr Julian Amery Mr Julian Amery , Preston North

I should have thought that we will be debating the questions and answers put by the Estimates Committee on Transport Aircraft—

Photo of Mr Julian Amery Mr Julian Amery , Preston North

This is the answer. My hon. and gallant Friend the Member for Macclesfield (Sir A. V. Harvey) asked whether I might arrange for a short debate to be held. That was the main point of his question and I was dealing with it first. I was saying that I should have thought that in the normal course of events, through the usual channels—although this is a matter for my right hon. Friend the Leader of the House rather than for me—the House would be likely to debate the position generally on the Report of the Estimates Committee on Transport Aircraft. That would enable hon. Members to discuss the whole question of Government policy and any suggestion of pressure, although I would deny that there had been any direct pressure.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

Will the Minister say whether or not an opportunity will occur for him to make a statement before the Summer Recess and that when Sir Giles reports to him that Report will be published in full and not as a bowdlerised version of it?

Photo of Mr Julian Amery Mr Julian Amery , Preston North

I could not possibly give that assurance, because I do not know what that Report will contain or what sections of it Sir Giles will wish to keep confidential.

Photo of Mr Jack Diamond Mr Jack Diamond , Gloucester

asked the Minister of Aviation whether he approved the cancellation of three VC10 aircraft, at a cost of £600,000, out of the original order of 45 by British Overseas Airways Corporation.

Photo of Mr Julian Amery Mr Julian Amery , Preston North

In 1961 British Overseas Airways Corporation decided to alter the proportion of Standard and Super VC10 aircraft on order. At this time, with the agreement of the Ministry, it negotiated the cancellation of three standard aircraft in order to comply with my precedessor's stipulation that the estimated cost of the whole order should not be increased.

Photo of Mr Jack Diamond Mr Jack Diamond , Gloucester

If, as I understand from the Minister's reply, the cost of cancellation in this case was £200,000 per aircraft, what credit is to be attached to the report that the figure being considered for cancellation in the new circumstances is £1½ million per aircraft, or seven times as much? Does not this question relate directly to the question which his hon. Friend the Member for Macclesfield (Sir A. V. Harvey) asked about pressure being put to increase the number of aircraft ordered by B.O.A.C.?

Photo of Mr Julian Amery Mr Julian Amery , Preston North

It is not my job to comment on reports in the Press about matters which are discussed between others. Even if I were a party to them, they are still very far from firm.

Photo of Mr Jon Rankin Mr Jon Rankin , Glasgow Govan

asked the Minister of Aviation why British Overseas Airways Corporation ordered 20 more VC10 aircraft than their first estimate; and why an option for 10 aircraft was made into a binding contract.

Photo of Mr Julian Amery Mr Julian Amery , Preston North

B.O.A.C.'s order in 1957 was for 35 Standard VC 10s. This was related to its estimated future requirements for southern and eastern routes. In 1960 it exercised an option to order 10 Super VC l0s for its transatlantic routes. To improve operating flexibility, these orders were revised in 1961 to 12 Standard and 30 modified Super VC 10s.

Photo of Mr Jon Rankin Mr Jon Rankin , Glasgow Govan

Does the right hon. Gentleman not realise that because he refused permission for B.O.A.C. to buy Boeing 707s but tied the Corporation to the VC 10 programme, which has now fallen into confusion and disarray as a result of the incompetence and incompetent handling of himself and those concerned with him, B.O.A.C. is now being compelled to use aircraft which it would normally be grounding—this at a time when the traffic figures of B.O.A.C. have enormously increased and the load factor is now 60 per cent. greater than a year ago? Does the right hon. Gentleman not realise that the sooner he makes his long-delayed statement on the subject of aircraft procurement the better it will be for B.O.A.C., and when will he make that statement?

Photo of Mr Julian Amery Mr Julian Amery , Preston North

I said earlier that I hoped to make a statement as early as possible, but I am sure that the hon. Member would not wish to stand here and give the impression that he was backing American aircraft against British aircraft. I am sure that he would not wish to give that impression.