Oral Answers to Questions — Private Companies (Financial Aid)

– in the House of Commons at 12:00 am on 4th April 1968.

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Photo of Mr Benjamin Whitaker Mr Benjamin Whitaker , Hampstead 12:00 am, 4th April 1968

asked the Prime Minister whether he will give a direction that all Government Departments should only advance financial help to private companies, in return for an equity for the public in any potential profits.

Photo of Mr Harold Wilson Mr Harold Wilson , Huyton

I have nothing to add to the Answer given on 21st November, 1967, by my right hon. Friend the Chief Secretary to the Treasury to a similar Question by my hon. Friend.—[Vol. 754, c. 1110.]

Photo of Mr Benjamin Whitaker Mr Benjamin Whitaker , Hampstead

If the public risk heavy capital losses on projects such as the Cunarder and Concorde, is it not fair that they should be given an equal stake in any possible profits from and directorships in the companies concerned?

Photo of Mr Harold Wilson Mr Harold Wilson , Huyton

These matters must always be considered on their merits in relation to any particular case. It might have been considered appropriate in the case of the help given to the Cunarder, but I assure my hon. Friend that after the great care taken by the Financial Secretary to the Treasury, who was dealing with these matters, there is no risk whatever of capital losses being made by the Government on the Cunarder project.

Photo of Mr Ian Lloyd Mr Ian Lloyd , Portsmouth Langstone

Since the State already takes about 75 per cent. of the profits of the average company in this country, how far does the right hon. Gentleman think that this limit can be further pushed without it totally destroying the allocative system on which private enterprise economy depends?

Photo of Mr Harold Wilson Mr Harold Wilson , Huyton

Questions of a budgetary nature were debated at length in the four or five days which were spent debating the Budget last month. My hon. Friend's Question deals with the point of where risk money is put up by the Government to help highly desirable enterprises by private firms. My hon. Friend is, I think, making the point that in appropriate cases the Government should not only share in the risk but should also share in the profits. We will do that where it is appropriate so to do, but we cannot have a hard and fast line in all cases.

Photo of Sir Robert Cary Sir Robert Cary , Manchester, Withington

Where a particular industry or business achieves an increasing level of productivity, would it not be most unfair to impose any such direction on that industry or business as mentioned in the Question?

Photo of Mr Harold Wilson Mr Harold Wilson , Huyton

The Question deals with cases where, for one reason or another, financial help has been given by the Government very often in the highest national interest; for example, to allow some important national venture to go forward. If productivity results from that, then there could be discussions on how the gains from that project should be shared, but, as I said, I believe that each case must be considered on its merits.

Photo of Mr John Lee Mr John Lee , Reading

If we are to continue with this policy of ladling out large quantities of taxpayers' money to private industry, will my right hon. Friend at least ensure that we take a controlling interest in the projects which we support?

Photo of Mr Harold Wilson Mr Harold Wilson , Huyton

That is exactly the position that is being dealt with in the discussion on the Industrial Reorganisation Corporation, in addition to the discussions on the Industrial Expansion Bill which got its Third Reading lastnight—[HON. MEMBERS: "When?"]—which was read a Third time either last night or early this morning.

An hon. Member:

Where were you?

Photo of Mr Harold Wilson Mr Harold Wilson , Huyton

The Leader of the Opposition and I were on other important work, as was the Leader of the Liberal Party. Now that that vote has been secured—[Interruption.]—by whatever majority, hon. Gentlemen opposite, who have done their political demonstration, will realise the value that this will have. They opposed the I.R.C. Measure, bit they will be the first to pay tribute to what the I.R.C. has achieved.