Loans to Successor Company to Rank as Priority Creditor

Part of the debate – in the House of Commons at 5:45 pm on 11 February 1980.

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Photo of Hon. Adam Butler Hon. Adam Butler , Bosworth 5:45, 11 February 1980

The hon. Gentleman helped us to go through the Bill with a fine toothcomb. I hope that there are no omissions. This point arises out of amendment No. 36, where the word "subsidiary" appears. Because people have different views about subsidiary companies, we felt it wise to put a clear definition in the Bill and to state that it has the same meaning as in the Companies Act 1948. That seemed to us to be a wise precautionary move.

I turn now to the points made by the hon. Member for Nuneaton and others of his hon. Friends. We heard today a number of the arguments that we heard in Committee. It is probably fair to say that most Opposition Members spoke to new clause 15. We discussed a similar clause in Committee.

The problems associated with funding the new company were considered by Opposition spokesmen from different viewpoints. They raised yet again the question whether private sector companies and investors are suitable for long lead time companies. They seemed to ignore that there are many examples of long lead time companies in the private sector in the chemical, metal processing, oil and power plant industries. They are almost legion household names: ICI, Shell, Rio Tinto-Zinc, British Aluminium. Those are all long lead time companies. I suggest that the lead times are as long in many instances as those for the production of aircraft or defence weapons.