Herbert Limited

Part of the debate – in the House of Commons at 12:00 am on 2 December 1975.

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Photo of John Stanley John Stanley , Tonbridge and Malling 12:00, 2 December 1975

(Tonbridge and Mailing): My hon. Friends and I appreciated the opening remarks of the Undersecretary of State when he referred to my hon. Friend the Member for Bridgwater (Mr. King).

The first point I wish to make about the motion is that the title is not at all correct. It is headed on the Order Paper Financial Assistance for Industry (Herbert Limited)". But, as the House will have gathered from listening to the Under-Secretary, we are not talking about financial assistance. What we are discussing in this debate is outright nationalisation of Alfred Herbert, albeit, I admit, with the shareholders' consent.

We should like to stress that this nationalisation is being carried out under the Industry Act 1975 and not essentially under the Industry Act 1972. If the motion had been brought forward under Section 8 of the Industry Art 1972, it would have been impossible to acquire more than a 50 per cent. interest in the company, whereas 100 per cent. interest is being acquired. In addition, there would have been a statutory obligation on the Secretary of State to dispose of the shares acquired as soon as…it is reasonably practicable to do so. That obligation has disappeared as a result of the 1975 Act. The powers under Section 22 of this Act are being used here for the first time, and it is now possible for the Government to take a majority and permanent interest in a company located anywhere in the United Kingdom by the simple expedient of laying an Order before the House. Many of us feel that this confers an unacceptable degree of ministerial power over which there is inadequate parliamentary control.

We recognise the dilemma the Government faced in deciding their policy towards Herbert. The choice was stark—nationalisation or receivership. Alfred Herbert is a once great British company. It still employs more than 6,000 people, many of whom have a long and loyal association with the company. Its places of manufacture are situated mainly in the West Midlands, which has a high level of unemployment at a time when we have a record national level of unemployment. But, while we recognise the Government's dilemma, it is inexcusable and unacceptable that, having made the decision to nationalise the firm rather than let it go into receivership, the Government have failed to give any reasonable justification or factual evidence for the decision to spend £26 million of taxpayers' money in this way. This was starkly revealed in the non-replies received from the Under-Secretary by my hon. Friend the Member for Oswestry (Mr. Biffen) and my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley).

There is no lack of detailed information available about the company. There have been at least three reports—from the Industrial Development Advisory Board, from the independent consultants Peat, Marwick and Mitchell, and the joint report by the firm's management and unions. It is striking that the Government have not seen fit to publish any of these reports. None of them is available to us.

Many of us felt that the Ryder Report was a pitifully inadequate document, but at least it was available to the House in the discussions on the British Leyland Order and Bill. The Government have been preaching to us incessantly on the virtues of disclosure, but they have disclosed less about the three reports on Herbert than they did about Leyland.