Property Services Agency and Crown Suppliers Bill [Money]

– in the House of Commons at 9:37 pm on 6th December 1989.

Alert me about debates like this

Queen's Recommendation having been signified—

Motion made, and Question proposed,That, for the purposes of any Act resulting from the Property Services Agency and Crown Suppliers Bill, it is expedient to authorize—

  1. (a) the payment out of money provided by Parliament of any sums required by the Secretary of State for making payments or for defraying his administrative expenses under that Act;
  2. (b) the payment of sums received by him by virtue of that Act into the Consolidated Fund or the National Loans Fund.—[Mr. Sackville.]

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South 10:15 pm, 6th December 1989

I want to raise one or two questions. During the reply, the Minister did not seem to grasp the nature of the question from his hon. Friend the Member for Horsham (Sir P. Hordern). Therefore, he might avail himself of this opportunity to explain precisely whether the money resolution, which is in fairly general terms, covers the position to which his hon. Friend referred.

The hon. Member for Horsham was saying that some obligation for pension payments would fall on the new companies and asked what provision the Government would make when the new companies take over those activities. It was not my question, but the hon. Gentleman's. He sought information. By common consent, the question was not adequately answered.

It is awkward when a money resolution is found to be inadequate for a range of purposes. There have been occasions when that has happened. I fondly recall one instance when the Minister had to return to the House three times—[Interruption.]

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

Order. I ask hon. Members who are beyond the Bar either to come into the Chamber or to leave it.

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

It would be embarrassing for the Minister if he had to return with another money resolution to meet those payments. I want him to be clear in his own mind and to assure the House that he will not be required to do that.

Administration expenses are raised specifically in the money resolution. Paragraph (a) authorises the payment out of money provided by Parliament of any sums required by the Secretary of State for making payments or for defraying his administrative expenses under that Act. It may well be that pensions can be included under that paragraph of the resolution, but the Minister gave no indication either of the sums that he would make in payment or of his administrative expenses. In the introduction to the Bill, the financial effects, which normally give an indication of the sort of money that will be needed, do not give an idea of the money that we are talking about. Clearly, the Minister will say that there will be revenue and that the resolution provides for payment from the Consolidated Fund, and we understand that. At the same time, however, it would be interesting to know what the administrative costs of this privatisation venture will be. Parliament has a right to know.

So far, the entire privatisation programme has cost more than £2,000 million in fees and advertising charges. The privatisation programme of the Government has meant that public assets, which we own, have been sold off. Those assets have been sold to the public as though the public do not already own them, and that amounts to legalised theft. The privatisation programme has been extremely costly. Perhaps the administrative money mentioned in the money resolution is a relatively small amount, but I hope that the Minister can tell us something about it.

What will happen during the construction of, for example, the Crown courts in Bradford? The PSA will start off that work because, presumably, the privatisation will not be accomplished by the time the construction starts. What will happen then? Will work be handed over? If the private contractors run over time and need more money, how will we hold the Minister to account? I had an Adjournment debate on the construction of the Crown courts in Bradford, to which the Minister replied. I spoke of the potential damage that might be caused to an important cross-Bradford rail link, which would provide a much improved rail service in Bradford, but that is not germane to the argument tonight.

How will hon. Members hold the Minister to account? With privatisation, does it follow that all public accountability will disappear out of the window? Will Ministers no longer be required to answer questions, whether about money resolutions or about their general level of accountability? It would be a sad day for Parliament were that so. If the Minister has some concern for democracy, he will assure the House that, irrespective of privatisation, Ministers will still be open to question, to challenge and to account. The House holds that right dearly and I would hate to see it diminished, but I suspect that that will be the case.

I have not detained the House too long, but I believe that the questions were worth raising, and I hope that the Minister will provide the answers.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment) 10:22 pm, 6th December 1989

The money resolution deal with two issues. First, it authorises payment of expenses incurred by the Secretary of State for the Environment in implementing the Bill. Secondly, it also authorises disposal of receipts from the sales of the Crown Suppliers and the Property Services Agency.

On the first question, the expenses will be administrative and will relate mainly to advice from consultants about the sales. In the case of the PSA, the privatization itself is not sufficiently advanced to be able to estimate the total costs that will be needed. In the case of the Crown Suppliers, I can tell the hon. Member for Bradford, South (Mr. Cryer) that £54,000 has so far been spent on the expenses of the sale. We expect the total expenditure on the sale to be less than £2 million.

Clause 3 would give the Secretary of State power to subscribe for or otherwise acquire shares or securities of a transferee company, and to make loans to those companies. We do not expect to make use of those provisions for the Crown Suppliers, since the companies will be sold immediately the Crown Suppliers' assets are transferred to them. In the case of the PSA, since the privatisation is some way away, and because we expect that the companies may trade as wholly owned public companies, there may be a need for the Secretary of State to make injections of capital from time to time.

On the second question, receipts from the sale of PSA and the Crown Suppliers will be paid into the Consolidated Fund. In the case of the Crown Suppliers, its debt with the national loans fund will first have to be repaid. The Secretary of State may therefore, with the Treasury's consent, direct sufficient proceeds of the sale into that fund, with the balance paid into the Consolidated Fund.

The hon. Gentleman asked about pensions. When the existing staff transfer to the new employer, should they opt to have their pension entitlement preserved, those pensions will still be the liability of the Treasury, through the Consolidated Fund, at such time as they are called upon. If the individual employees choose to have their pension rights consolidated and transferred to the new organisation which is setting up a pension fund, a sum or sums of money will have to be transferred from the Exchequer to those pension schemes. However, that is not new money, because it represents the present contingent liability of the Exchequer for the pensions of existing staff of the Crown Suppliers and the Property Services Agency.

I hope that I have answered most of the points raised by the hon. Gentleman. He also referred to the Crown courts in Bradford, an issue which, as he said, I have previously debated with him across the Floor of the House. The procurement of the Crown courts, as of all civil projects, is, and will be, the responsibility of my right hon. and noble Friend the Lord Chancellor. He and his Department will be accountable to Parliament for the expenditure incurred on such projects.

Question put and agreed to.