Inmos began to trade profitability in the last quarter of 1983 and this trend has strengthened in 1984. A group of investors had proposed to make a placement of £30 million in new shares in the company, but in the light of Inmos's current performance and its improved prospects the Government have withheld the signature of the British Technology Group to this proposal. The BTG is actively exploring other options for the transfer of the company to the private sector, bearing in mind the taxpayer's past investment and the future development of Inmos technology.
I am sure that my right hon. Friend will agree that it is extremely good news that Inmos should have achieved such excellent results and performed so well in such a relatively short time. However, will he give an assurance that if Inmos is transferred from the BTG to the private sector the taxpayer's investment will be protected, together, with the long-term future of the Inmos plant at Newport?
I can give my hon. Friend that assurance, and I appreciate that the plant is in his constituency. Indeed, the plant at Newport is a major factor, as is the design team at Bristol, in considering the future development of Inmos. More than 800 people work at Newport and about 70 at Bristol. There has obviously been a substantial transfer of technology to Newport and we shall want such transfers to continue.
Does the Minister appreciate that there will be considerable concern about any proposal to privatise the company, particularly as it is involved in new technology that is vital to this country? The Government should keep a grip on it, particularly in view of all the public money that has been poured into the organisation.
I do not agree with the hon. Gentleman. High technology does not have to be developed solely and exclusively in the public sector. Indeed, most high technology is developed in Britain in the private sector.
The Government invested in Inmos with the intention of getting it established. It is now established and will require further substantial capital investment. We believe that that should come from the private sector.
As I said in my original reply, at present we have ruled out only a placement of £30 million of shares, as the terms were not attractive enough. However, the boards of the BTG and Inmos are looking at other proposals. Several companies in the United Kingdom and overseas are interested in investing in Inmos, and at present no option is excluded.
Does not the success of Inmos demonstrate that the Government can play a most useful role in ensuring that very important high technology industries have a presence in this country? Will the right hon. Gentleman therefore give an assurance that the company will not be allowed to fall into foreign hands?
I accept that the success of Inmos demonstrates that catalytically Government investment can produce an activity. Indeed, I have often said that from this Dispatch Box. We shall look carefully at all the proposals from both overseas and British companies as well as American Telephone and Telegraph, bearing in mind not only the price that is offered but three important criteria: continuing access to the technology by British industry, the need for a continuing transfer of technology to Britain, and a commitment to the development and expansion of activity in the United Kingdom.
Does my right hon. Friend agree that although Inmos should not be in the public sector it should remain under British control and ownership? As integrated circuits are now a vital raw material, is it not important that this large indigenous supplier should not, if possible, be dependent on decisions taken elsewhere?
I fully appreciate what my hon. Friend has said. If he will study the criteria that I have announced, I think he will be satisfied that any proposal for the development of Inmos will fully take account of his point.
I am glad to say that there is considerable interest in Inmos from several countries. Perhaps it is appropriate on this day to say that there is more than one horse in the race.
Does the Minister accept that this remarkably successful and highly innovative enterprise would not have existed if it had not been pioneered as a public enterprise? Therefore, is it not ludicrous to be contemplating the privatisation of one of the most successful public enterprise firms in the country?
Will the Minister give a categorical assurance that there is no truth in the story published in The Times that the Government are seriously thinking of selling Inmos to AT and T? Would not such a sale be wholly contrary to the British national interest and to the efforts to deal with American extra-territoriality, upon which the Secretary of State sets a great deal of store?
As I made clear earlier, we believe that private sector investment should now take on the continuing and very substantial requirements of capital investment in the company. I am glad to recognise that the company has reached a stage where it has become profitable.
There is no proposal of which I am aware for the outright purchase of Inmos by an overseas firm. If the right hon. Gentleman will carefully study what I said about the requirements that must be satisfied for the future of Inmos — the continuing access of British industry, the continuing transfer of technology and the commitment to the development and expansion of activity in Britain—he will realise that we have the interests of our country at heart.