Orders of the Day — Iron and Steel (Amendment) Bill

Part of the debate – in the House of Commons at 12:00 am on 11 May 1978.

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Photo of Mr Richard Wainwright Mr Richard Wainwright , Colne Valley 12:00, 11 May 1978

Today's debate is one more incident in the baffling search for means of democratic control of a nationalised manufacturing industry compatible with highly efficient management. This is a search to which Liberals believe that there will be no satisfactory solution, because that particular circle simply cannot be squared. But, faced with the existence of the BSC, we have to do our best and to hope to make at least some progress.

I believe that some progress in effective democratic control, consistent with commercial behaviour, has been made in recent months. In particular, the priceless boon of a unanimous Select Committee ought to be welcomed. I hope that it is being welcomed by the British Steel Corporation, which has every reason to complain of having been the victim of political bickering in the past.

I am very glad that the Government have produced, for once, prompt replies, within 10 or 11 weeks, to the reports of the Select Committee, and that we have them available for today's debate. As has already been said, the British Steel Corporation is now very much closer to reality, and we are no longer having the grandiose and Olympian plans which used to appear in the past.

I also believe that minority Government is proving to be a healthy thing for realistic treatment of the British steel industry. No minority Government could have committed the disastrous error of the Beswick review because it would not have been allowed to do so. The hon. Member for Kingston upon Thames (Mr. Lamont) has not made sufficient allowance, in his dire prophecies for the possible future of the BSC, for the changed position as a result of minority Government.

As to parliamentary control, impossible as it is to arrive at anything approaching a complete solution, there is no answer to be found in trying to put such a high technology industry into a totally precarious financial position by subjecting it to the doling out of money on a calendar adjusted to the rhythm of seed time and harvest, which has nothing to do with the modern manufacture of steel. That is why my hon. Friends and I cannot agree with the amendment of the Conservative sector of the Opposition.

I was surprised at some of the other objections to the Bill raised by the hon. Member for Kingston upon Thames. He said that he had hoped to see the scheme for capital reconstruction available so that it could be considered with these new borrowing powers. I understand the pious hope expressed by the Government and the BSC that they will before long have a stable position in which they can hope to devise a realistic and long-lasting capital reconstruction. However, I see no sign of this on the horizon. A basic difficulty would be putting any kind of realistic value on the fixed assets of the British Steel Corporation. It does not need arguing that the value of these cathedrals by the sea, to which the right hon. Member for Stafford and Stone (Mr. Fraser) referred, depends almost entirely on whether they can sell their products at a profit.

The only part of the admirable and realistic "Prospects for Steel" document, which the BSC has supplied, which I would criticise is the unhelpful emphasis that it places on an alleged value of £10,000 million worth of fixed assets. Who can say what these fixed assets are really worth, even at a replacement value? Who knows whether we shall ever want to replace them? We cannot start a capital reconstruction until we have some idea of the commercial worth of the fixed assets. There is no Solomon available in the highly unstable position of steel industries throughout the world today who can say what a big modern steel works is worth.