Transfer of Property Services Agency and Crown Suppliers

Orders of the Day — Property Services Agency and Crown Suppliers Bill – in the House of Commons at 7:45 pm on 12th February 1990.

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Photo of John McFall John McFall , Dumbarton 7:45 pm, 12th February 1990

I beg to move amendment No. 2, in page 1, line 21, at end insert ', with the exception of the Security Group of the Property Services Agency and any property, rights or liabilities related to security work.'.

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Deputy Speaker (Second Deputy Chairman of Ways and Means)

With this we may take amendment No. 4, in clause 6, page 3, leave out line 46.

Photo of John McFall John McFall , Dumbarton

In Committee, my hon. Friend the Member for Linlithgow (Mr. Dalyell) asked the Minister what advice he had on security, and whether it was properly discussed with those responsible. When he asked whether the matter had been referred to either the secretariat or the Joint Intelligence Committee, the Minister failed to answer. If he had said that it was subject to proper discussion, we would not now be discussing the amendment. I suspect that there is now a bigger tale to be told.

We also asked in Committee whether the Minister had raised the matter with the Ministry of Defence. He replied that the Secretary of State for Defence, being a member of the Cabinet, agreed with the decisions that had been made, but again he did not say what the security personnel thought about the matter. As a member of the Select Committee on Defence, I had an opportunity to raise the point with MOD officials, who replied—in a manner that was both sophisticated and as bland as the Minister's—that they had their concerns, but that those concerns would be discussed later. In our view, they have not been resolved because the Minister has not turned his attention to them.

I can give an example. The Select Committee discussed the physical security of military installations. Having engaged in public discussions with the MOD over the past few weeks, we have discovered that when security is handed over to private firms they pay poverty wages. We have also discovered massive loopholes. Last week, for instance, I asked the Assistant Under-Secretary whether it was possible for someone to deceive the authorities by assuming a different name, and to get into a military installation. The reply was that it was eminently possible. When I asked the MOD police, I received the same answer. That loophole must be closed.

I fear that the Minister has paid even less attention to the Bill's security implications than the MOD has paid to the physical security of military installations, and that the consequences of his lack of rigour may be severe. He has responded inadequately not only to Opposition Members, but to his hon. Friends. In Committee, the hon. Member for Basingstoke (Mr. Hunter) said that he hoped that the Minister would take on board the concern felt by many hon. Members; again, the Minister would give no details.

The Minister himself said in Committee that the majority of the PSA's work was sensitive in security terms, some of it extremely sensitive: for example, more than two thirds of its new construction and maintenance programme is for the MOD. He cited the Clyde submarine base in my constituency, where 110 major projects are currently under way. I take his point that much of the work is untied at present, and that most of those 110 contracts will be carried out by private firms. I am concerned about the maintenance jobs. In the case of the submarine base, 200 jobs are involved. There are 90 industrial and 36 technical staff. It is important for staff to have a deep knowledge of the workings of such plants, which are enormously complex technically, and such knowledge can be gained only through historical familiarity with them.

I told the Minister that people who knew had told me that it would take a new operator at least 12 to 15 months to gain hands-on experience of the plant—to build up expertise on a learning curve. How can that happen if the contracts are subject to competitive tender, as the Minister says that they will be? The logic of privatisation is that the PSA must compete for work; if it is not to compete, what is the use of privatisation? If work is always given to the PSA for security reasons, I suggest that Faslane and other such installations should not be included in the privatisation proposals.

In Committee, the Minister was asked whether he had undertaken a risk assessment, taking account of possible management failure. The answer was no. In view of that, I consider it not only reckless but dangerous to proceed with the privatisation programme. The leaked report by the PSA's regional directors predicts a 32 per cent. cut in business contracts and a possible loss of 200 jobs. Still worse, the loss of either Rosyth or Faslane would have a major impact on the PSA's viability. I ask the Minister to consider not only the financial but the security implications.

It would be fine if the Minister's case was consistent, but the Committee knew from the outset that it was not. My hon. Friend the Member for Hammersmith (Mr. Soley) asked a question which bears repetition: if the Secretary of State's car and the design and security of Minister's homes are to be under the control of the PSA or a suitable Government Department, how can it be acceptable to transfer other personnel who face the threat of the paramilitary? I would like the Minister to answer that question now so that I can take the answer back to the people who work in the military installations in my constituency. What is the difference between the security implications for a Minister or his home, and the implications for highly sensitive military bases? By his failure to answer that question, the Minister underlines both the paucity and the danger of his proposals.

Another inconsistency has developed since the Committee has been in business. For reasons well known to all of us, in some parts of the United Kingdom services will not be put out to competitive tender. The Minister denies that at his peril. If that is acceptable, why is it not acceptable for services involving military installations and security bases not to be put out at all? The Minister must explain that inconsistency tonight. I have to tell my constituents that PSA work services in certain parts of the United Kingdom will not go out to tender. However, they will go out at Faslane and at the Clyde submarine base because the Minister does not believe that the Clyde submarine base is a sufficiently high security service for it not to go out to tender. That is the only conclusion that I can draw from the Government's inconsistency. I hope that the Minister can at least smooth out that manifest inconsistency.

The Minister has shown that he cares little for the 200 or 300 jobs that will be lost in Scotland or for the 1,000 jobs that will be lost throughout the United Kingdom. I can conclude only that by privatising the PSA the Minister may save some money. However, will he save lives at the bases that are affected? The Minister is being reckless by pursuing the privatisation proposal. He has not fully thought out the proposal and he does not have the full agreement of the security forces. He is jeopardising the lives of the service personnel in our United Kingdom bases. He should be ashamed about that, and that is why we will press the amendment.

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Photo of Mr Richard Livsey Mr Richard Livsey , Brecon and Radnor

The amendment is very important because the privatisation of the PSA will have considerable security implications. The PSA designs and maintains sensitive security sites such as RAF Fylingdales, GCHQ and, as has already been stated, the nuclear submarine base at Faslane. Therefore, PSA staff are vetted for those purposes and are also subjected to the Official Secrets Act 1911. The PSA also security vets every contractor working on a Government site and nearly one employee in 10 is rejected by that vetting. Vetting is expensive and time consuming and the whole procedure may be put in jeopardy because of the thrust towards privatisation in which profit may overtake security implications.

The American and West German Governments have already informed our Government that they will work only through British civil servants for design and maintenance on their military sites for which the PSA works. I understand that there are 500 civil servants in Germany looking after the building and maintenance of military installations. If the West German Government believe that they should remain in place because of the security implications, that is an important consideration. The West German and American Governments oppose privatisation. Will the Minister tell us what feedback he has had in his discussions with those Governments?

Will the Minister name any other countries in which the functions that we are discussing tonight are privatised? Other countries are not prepared to privatise such work. Ministers have also decided that security work on Cabinet Ministers' homes and their own homes will not be privatised while work on military and married quarters will be.

Recent tragic events have shown that the homes of military personnel are as vulnerable to terrorist attack as ministerial residences. If the privatisation of the PSA poses no security threat, why are Ministers' residences excluded from the privatisation plans? There is an inconsistency there which the Minister must answer. That is one of the reasons why my party will oppose the Bill tonight. We have not been satisfied by any of the assurances that the Minister has given about security.

Photo of Mr Edward Leadbitter Mr Edward Leadbitter , Hartlepool

The question of security has taxed the patience of this House for many years. Lapses of security have always created a sense of anger and sometimes frustration when we have not been able to get explanations from the Government—and by Government I mean Governments of all political persuasions. Security is a subject which in some form touches us all. However, whenever we show an interest in how to deal with it and how to put our views to the authorities about how security could be enhanced and ringfenced to provide the highest levels of public confidence, we are treated at arm's length.

The Bill is small, but it affects many people. When we discussed new clause 1 we were not satisfied that certain things such as empire building in the Departments—under the heading of replication—would not occur. Also we have heard nothing that persuades us of the case for privatisation.

The Government may have an argument on privatisation and security. They may be able to say that large areas of private enterprise deal with sensitive security matters where there are no problems. The Government may be justified in claiming in those cases that there are satisfactorily ringfenced and regulated accountability conditions so there is a higher level of support for work to be placed in the private sector than in the public sector. Very often there are unfortunate lapses in the public sector. However, that is not a good argument.

My colleagues have already said that an outstanding disparity follows the unfortunate reasoning behind the privatisation proposal. Why will we exclude Ministers' houses from the proposal? Why should it be a logical conclusion that what is good for Ministers' houses is not good enough for other properties? In many cases people are more in the front line of danger than Ministers.

I remember being very worried when I was a young officer in the last war. Over the years since then I have pondered about how silly it is for us to send young boys of only 17½ and 18 to Ireland. They do not even know where the enemy is. That is an example of people at the sharp end of the problem who are in danger.

I do not want to underestimate the importance of the work of the Secretary of State for Northern Ireland, because his is a very dangerous job. However, he is guarded every moment of the day. Therefore, the Bill falls short. We are treating Ministers differently. That cannot be logical.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

Does the hon. Gentleman accept that, when he describes Ministers, he should also refer to former Ministers, some of whom are his colleagues?

Photo of Mr Edward Leadbitter Mr Edward Leadbitter , Hartlepool

Some of them are so long past that I often have a sneaking suspicion that they enjoy their security too much to allow it to wither away. Nevertheless, one does not want to be too critical about dangerous situations. We must act responsibly.

Is there a case for privatisation? To put it another way, when we have satisfactory security in defence programmes throughout the United Kingdom, will we put security at risk if we privatise security at defence installations? That is a very good question, and the Minister should be able to answer it. The issue is not party political. Hon. Members have a common interest. We want to know whether, although there is a case for responding reasonably to high standards of security in the private sector, there is a case for widening it and, therefore, possibly weakening it.

There has been ample time for consultation. What representations has the Minister received from security officers and from representatives of the PSA? Have they indicated any concern, and has the Minister responded to them? Hon. Members may be more confident if the Minister is able to tell the House that consultations have satisfied him and, therefore, that they should satisfy us. I suspect that he will not be able to tell us that with any confidence.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

This has been an important debate. Hon. Members may recall that this subject was important also on Second Reading and in Committee. As I said on Second Reading, the Government have not thought through the consequences of their actions in privatising the PSA and the Crown Suppliers. My hon. Friend the Member for Dumbarton (Mr. McFall) has moved amendment No. 2 dealing with security. Amendment No. 4 would exclude Northern Ireland from the scope of the Bill. On Second Reading, I said that the Bill would allow paramilitaries operating out of Northern Ireland to have greater opportunities for terrorism in this country and in Northern Ireland and for raising money in Northern Ireland.

One of the best speeches in Committee was made by the hon. Member for South Down (Mr. McGrady) on behalf of the SDLP in Northern Ireland. He pointed out what and other Committee Members have known for all too long, which is that paramilitary groups on both sides—Unionist and Republican—obtain significant sums of money from threats and extortion. The most vulnerable groups include the private building sector and related organisations. The hon. Member for South Down pointed out that it is well known in the Province that 20 per cent. is usually added to the cost of a contract, and that sum is passed on to paramilitary groups.

8.15 pm

If hon. Members are satisfied with that, it would be a shame. They cannot be satisfied. If we include Northern Ireland in the scope of the Bill, and we privatise several organisations, there will be the real danger that funding for paramilitary groups will be increased. I put it no higher than that. I do not expect the Government to say how they have adequately coped with that. However, on Second Reading, it was clear that they had not thought about the consequences. In Committee, it was clear that the Minister did not know all the answers. Perhaps one should not expect him to do so, because the information is particularly sensitive, but I have no reason to believe that adequate thought has been given to how to proceed with the privatisation.

When a service in Northern Ireland is privatised, company directors are threatened that, if they take on Crown contracts, they or their work force may be shot. That is precisely what happens there—they are shot. Several people have been shot in the past few months. If the Government have got this wrong, it is literally a fatal warning to people in Northern Ireland. I would much prefer that this matter is kept out of the Bill so that we do not create that possibility.

If we are satisfied with present security—the Government are always telling us that they are doing everything possible to improve and maintain security—surely we should not be changing the practice. If they think that this measure will improve security, surely they can say so. They have not said whether it will improve security or make it worse. The most that we have had is an indication that, somehow or other, the measure will not do an) damage. It is deeply disturbing that the Government's policy is not well thought out.

My hon. Friend the Member for Dumbarton, who was ably supported by my hon. Friend the Member for Hartlepool (Mr. Leadbitter), referred to Ministers' cars and homes. In Committee, my hon. Friend the Member for Dumbarton and I challenged the Minister on the privatisation of the car driving service and the security of people's homes and the exclusion of Ministers' cars and homes. The Minister said: The hon. Member for Linlithgow knows that a review was carried out in 1988 after the announcement of our intention to privatise the Crown Suppliers. That review concluded that the ministerial car service and some of the Crown Supplier's work on security furniture and equipment should be retained within Government. The reason in the first case was the nature of the terrorist threat to Ministers. In the second case, security considerations argued against delegating to a private firm either the design and development work of the Crown Suppliers security branch or their work in choosing and approving manufacturers. The House should note those final words: choosing and approving manufacturers. The Minister has just intervened to respond to the argument about why Ministers' cars and their home security were excluded from the provisions. His defence was, incredibly, that it was all right because it applied to Ministers of both parties, from this Government and from previous Governments. That is unacceptable. As my hon. Friend the Member for Dumbarton said, that will not apply to service men's families or homes or to a number of senior civil servants who are at least as much at risk—and in some cases more at risk—from terrorists than Ministers. According to the Minister in Committee, the security is necessary for Ministers, so why is it not also necessary for senior civil servants and the families of service personnel, who are at least as much at risk?

I repeat what I said on Second Reading. The Labour party is not prepared to accept a second class of security for civil servants or for service men or their families compared with that offered to Ministers, whether they are Labour or Tory Ministers, past or present. That argument is unacceptable to us and it should be unacceptable to all hon. Members.

The first time that a senior civil servant or a member of the armed forces or one of their families is killed or seriously injured as a result of a second-class service., the responsibility will be on those who have supported the Government on this Bill. The position is that serious. That is why the Opposition are so opposed to the Bill and that is why we are now seeking to exclude Northern Ireland from the provisions and exclude the security group of the Property Services Agency and its related design facilities.

Photo of Mr Edward Leadbitter Mr Edward Leadbitter , Hartlepool

My hon. Friend must convey distinctly and clearly that the lesson is that if the Government cannot show that their proposals do not put security at risk, they should not put them into practice.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

My hon. Friend is absolutely right. Sadly, he did not serve on the Standing Committee with us; his expertise and knowledge would have been useful. The tragedy is that, over and over again, the most that the Minister has been able to tell us is that he does not think that there is a risk. That is not sufficient. As I have already said, if the Government were to suggest that by keeping Northern Ireland on the face of the Bill—in other words, including privatisation provisions for Northern Ireland—security in Northern Ireland would be improved, it is probable that we should have to accept that as the Government's judgment because, although we cannot ask for evidence on the Floor of the House, at least we would have something to work on. However, the Government will not say that. They simply say that, in their judgment, the provisions will not make security any worse.

As I have already said, the hon. Member for South Down, who lives in Northern Ireland and knows the scene there and who put the case so forcefully and so well in Committee, has not yet had the response that he deserves to his serious speech.

Further to the intervention from my hon. Friend the Member for Hartlepool, the issue of Ministers' cars and homes is the clinching argument. If, according to the Minister's own words, this level of security is so necessary for Ministers of the Crown, why is it not necessary for civil servants or for armed service men and their families? Either security for Ministers is better, in which case we should bring everyone's security up to that level, or it is worse, in which case we should improve security for Ministers. The Minister's statement in Committee was clear. He said specifically that the facility should not be privatised for security reasons. Therefore, one assumes that that is because the PSA offers a higher standard than could be achieved in the private sector. If that is the argument—and it must be the only argument unless the Minister has any other suggestions—its logic should also apply to senior civil servants and to members of the armed forces and their families. There should not be a second-class standard or second-class delivery of security services for such people. That is the force of our argument and we should believe that it is a powerful argument.

My hon. Friend the Member for Dumbarton made some extremely important comments. When considering the design of military bases in this country, we must also consider not only what happens on the base itself, but the perimeter security and everything that goes with that in terms of the people who enter the base to work on it. If my memory serves me right, it was the hon. Member for Southampton, Itchen (Mr. Chope) who said in Committee that it was quite normal for outside contractors to go on to United States or German bases to provide, for example, fast-food outlets. We know that. But I shall refer again to his exact words in Committee. Although I have already quoted this passage, I emphasise the words at the end. The Minister referred to the design and development work of the Crown Suppliers security branch or their work in choosing and approving manufacturers."—[Official Report, Standing Committee D, 11 January 1990; c. 84.] What is going to happen when a company is chosen to do some work at Faslane, Aldermaston or one of the other bases in this country? At the moment the PSA has some say about which company should carry out the work and takes into account security factors and the people who work for the company, to the extent that one in 10 of all employees are excluded on security grounds. Although we are told that that system will end, the Government's secret argument is, "Ah but, it will not disappear because we shall transfer it to the relevant Department. It could be transferred to, for example, the Ministry of Defence."

Although we are also told that there will not be any mini-PSAs, in fact, that is exactly what we shall have. Presumably, the Ministry of Defence, the Northern Ireland Office, the Home Office, the Department of the Environment and a number of other key Ministries will all have their own mini-PSAs for security work. The alternative is to keep the whole thing as a national body, in which case why are we privatising it? Why do the Government not say, "We accept the two amendments, one excluding Northern Ireland and the other excluding the security group and its related work"? I can well understand that the Minister may keep the security group out of the privatisation, but I am concerned about the related security work.

Let us consider the lighting that is necessary on the perimeters of secure establishments. The design, location and the lighting itself are the work of the PSA and can be crucial. Experimental work is carried out into the anti-blast properties of the materials that are used in the homes of, for example, service men's families, senior civil servants, Ministers and at military installations in general. That work is not only controlled and supervised by the PSA, but carried out by the PSA itself in many instances. However, much of the work is now to be carried out either by in-house PSA in the relevant Ministry or by a private contractor.

The problem does not stop there. Let us consider Broadmoor and Britain's prisons. Again, the work of the PSA is essential to security. That is why I want to make it clear that, leaving aside the amendment covering Northern Ireland, we are raising the full range of security issues that are affected, in relation not only to terrorism or defence, but to all the secure establishments that are necessary in our society.

I repeat for the third or fourth time that the Opposition do not expect the Minister to give us details of the security thinking or of the discussions that have taken place. However, if the Minister cannot explain his comments when he said that for security reasons it is necessary not to privatise Ministers' cars and the design, selection and approval of their manufacturers, he should explain why that is necessary for other areas and for other groups of people, such as civil servants. If he is not going to privatise any of those categories, he must address the argument about the mini-PSAs and tell us whether there will be a national group.

The Minister should be able to say categorically that if the Bill is to apply to Northern Ireland, in the judgment of the Government it will improve the security position there. If the Government cannot make that statement, it will not be enough to say that the Bill will make no difference. All the remarks of the hon. Member for South Down about the activities of paramilitaries and all that we know about threats to employers and companies that do Crown work show that the Bill would risk making the position worse. The Opposition believe that that risk is not worth taking.

Photo of Mr Kenneth Warren Mr Kenneth Warren , Hastings and Rye 8:30 pm, 12th February 1990

Many of the matters about which I was going to voice concern have already been raised by the hon. Member for Hartlepool (Mr. Leadbitter), with whom I share considerable anxiety about security.

If I had been on the Standing Committee, I should have tried to obtain more detail than seems to have been obtained—but from what I have read of the report of the Committee, I am confident that my hon. Friend the Minister will give us some reassurances.

I am worried about a particular matter. The unions have drawn the attention of the House to the dangers that they regard as inherent in what they call the Trojan horse of allowing repairs and maintenance to be done by sub-contractors who are not covered by security clearance when the work requires clearance.

As Opposition Members said, we do not expect my hon. Friend the Minister to describe in public the security arrangements of those who need the cover of security. Nor do I believe that all Members of Parliament are at risk from terrorist attack. We must take our own precautions according to what is required. However, I hope that my hon. Friend will tell the House that those who require the cover of security for repair and maintenance work to their property or transport will continue to receive it. If the chauffeur service is not to be privatised, what about security clearance of those who carry out repairs and maintenance on the vehicles? What about unknown contractors who carry out repairs and maintenance work in the homes of civil servants? In Northern Ireland civil servants carry out everyday duties which here on the mainland are regarded as straightforward, but which carry an inherent risk there because the nature of those duties is considered by terrorists to be contrary to what they stupidly deploy as their views.

I hope that my hon. Friend will recognise that the matter does not divide the House but unites it. I hope that he will bear that in mind when he replies.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I give an absolute assurance to every hon. Member who has spoken and to the House that security is not jeopardised by the Bill one iota. The hon. Member for Dumbarton (Mr. McFall), who opened the debate, expressed anxieties about security. Perhaps I can remind him of the answer that my hon. Friend the Minister of State for the Armed Forces gave to a question tabled by the hon. Gentleman on 6 February. The question was: To ask the Secretary of State for Defence what are the implications for the security of military installations of privatisation of the Property Services Agency. My hon. Friend replied: The arrangements for the security of military installations will not be adversely affected by the privatisation of the Property Services Agency."—[Official Report, 6 February, 1990: Vol 166, c. 593.] Opposition Members do not seem prepared to accept that that is the position. I find that a sad reflection on them.

All aspects of the security of service married quarters will remain the responsibility of the relevant armed service and will continue to be taken seriously. Up to now the PSA has acted as the agent of the Ministry of Defence for the construction and maintenance of married quarters and other service buildings. It will continue to do so in future. The PSA and the many civilian contractors that it already uses are subject to the general and local security arrangements in force at the time. The privatisation of the PSA will not affect such arrangements in any way. All security matters will remain the responsibility of the appropriate service commander. Therefore, it is absolute nonsense for Opposition Members to suggest that a double standard is being applied. Security is provided with a single standard for the whole of Government business.

In Committee, the Government were guided by the advice that they received on security matters. When we were considering the details of the privatisation of the Crown Suppliers and deciding which parts of it should be privatised, we were guided by that advice. I assured the Committee, and I assure the House today, that we shall accept the advice tendered. The advice tendered on the ministerial car service was that it should not be privatised.

Although I know that some of my colleagues and some Opposition Members feel that it would be perfectly reasonable to privatise the service, we shall not privatise it because our advisers tell us that it would be wrong to do so on security grounds. That shows that the Government regard the issue of security as of paramount importance.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

Were the security services consulted about the risk of privatising the PSA where it affects the security of service men and their families and civil servants? If so, what did they advise?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

Private companies are already involved in the security of, for example, Ministers' residences. The hon. Gentleman and others have suggested that virtually all Ministers have security at their residence. The House will know that only a few Ministers have security precautions at their residence. Those who have security arrangements have them because of the position that they hold or have held. That includes former Ministers from both sides of the House.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

My question was about a matter on which the advice was clear. The Government were told not to privatise security for Ministers' cars and homes. I am asking whether advice was requested on the security of service men and their families and civil servants. If so, what was the answer? Was it that it was OK to privatise that service because it was not a security risk? If so, what was the difference?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

There is no difference. The present arrangements for Ministry of Defence establishments and employees will apply in the future. The arrangement is that Ministers and, where necessary, senior officials and service men on official business all have access to secure forms of official transport, either civilian or military, as their duties require. That is the position now and will be the position in future.

Photo of Mr Edward Leadbitter Mr Edward Leadbitter , Hartlepool

The Minister must bear it in mind that the House will not be critical of the advisers to whom he must listen. However, the House must consider the history of advisers. Sometimes advice is good and sometimes it is bad. Only experience can tell us that. This matter unites the House. To what extent has consultation with the people affected by the Bill, whose future will be determined by it, and who are worried about the security services, supported the advice that the Minister has been given?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

We have completed the consultation on privatisation of the Crown Suppliers. The process has been carried out to the satisfaction of all parties. I am sure that the same will be true of the privatisation of the PSA. The hon. Member for Hartlepool (Mr. Leadbitter) is aware that the PSA is not to be privatised until the second half of 1992. At this stage the finer details of security matters have not been worked out. That is why I give the assurance that the Government will listen to and follow the advice that they receive on those matters and will not put security at risk in any way. I hope that that will be acceptable to the House.

Photo of John McFall John McFall , Dumbarton

The Minister said that ministerial cars and homes, and civil servants' homes, will not be subject to tendering. Is he telling us that politicians and civil servants face a greater threat and that their security interests are more paramount than those of military personnel and their families, and military installations? That is the only deduction that we can make. Is that the case?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

That is not the case. The Government accept the advice that they are given by their security advisers. The Ministry of Defence listens to security advice and decides how to act on it in relation to its serving personnel and their dependants. Likewise, the Government listen to security advice and act on it in relation to the protection of Ministers and former Ministers. I am sure that most people would accept that that is a reasonable way to proceed. The Government do not second-guess security advice; they receive advice and act on it. That is a responsible way to behave.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

I wish to pursue this on a further intervention because the matter is extremely important. The PSA and the Crown Suppliers operate across a wide range of services. Two of the Government-appointed bodies that reported said that privatisation should not take place. The third report, the only one that dealt with how to privatise, was asked a different question. It was asked not whether privatisation should take place but how it should take place. If the first two reports advised against privatisation, was security one of the reasons for that advice? Given that the Minister made it clear in Committee that all the security work of the Crown Suppliers should not be privatised, is he saying that it will not be privatised, so the Government accept amendment No. 2?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

No advice that we received on those earlier reports was directed towards the issue of security, but one report mentioned security in relation to the Government car service. The advice was that the service should not be privatised on security grounds. I am sure that it comforts the hon. Gentleman to know that the Government are following that advice.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

I apologise to the Minister for intervening before he has answered my second question. What troubles me about that is that it suggests that the Turton report and the second Government-appointed group took account of only the Government side of the work and not the wide range of work beyond that. The least that the Government should be able to tell us is that the security implications of the Bill across the whole range of work, including prisons and special hospitals for the security services or the relevant group of police who deal with these matters, were given detailed consideration.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

Perhaps I can come to those issues. Certainly I can deal with the point about the amendment and why it is not acceptable to the Government, and the extent to which the Government accept the spirit behind it.

The intention behind the amendment is to prevent the PSA from undertaking security sensitive work once it is in the private sector. The effect would be to make a clumsy impracticable and unnecessary division of the work undertaken by the PSA, between that included in a scheme in clause 1 and that retained in Government. The amendment is clumsy and impracticable because it assumes that there are clear distinctions between management of security sensitive and non-security sensitive work. That is not the case. In most areas, the work contains a mixture of both. That is why the amendment is unacceptable.

More than two thirds of the PSA's new construction and maintenance programme is for the Ministry of Defence. The PSA is currently responsible for the project management, oversight and design of the facilities for the Trident submarine base at Coulport, Faslane and Rosyth. It manages the maintenance of all the front-line operational RAF and USAF air bases in the United Kingdom. It is the agent for arranging the construction and maintenance of barracks and married quarters for the British Army in the United Kingdom and overseas.

8.45 pm

On the civil side, the PSA has responsibilities that include overseeing the design and building of new high security prisons for the Home Office. It is also responsible for works services at Buckingham palace, Windsor castle, the Palace of Westminster and No. 10 Downing street. It maintains buildings and services at GCHQ in Cheltenham.

Although the PSA manages all those works, that does not imply that it is responsible now for determining security requirements. It is the responsibility of the client Department to assess the level and nature of the threat to its various facilities and to decide what type of protection is needed. That is true, for example, of the weapon resistance of hardened aircraft shelters and the physical protection of individual Government buildings. The PSA's task is to take the requirements specified by the client and arrange to design facilities that meet those requirements.

Photo of Mr Tam Dalyell Mr Tam Dalyell , Linlithgow

The Minister says that the PSA is responsible for No. 10 Downing street. Will he confirm that on 24 January the Prime Minister went to the Tate gallery to see its £1 million revamp and said of the gallery management: I know, because they have told me, that since they didn't have to go to the PSA they have got a lot more value out of the money they've had. And, of course, I must tell you we have found the same in No. 10 Downing Street"? Does the Minister share the Prime Minister's criticisms of what happened at No. 10 Downing street?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

My right hon. Friend was commenting on the benefits of untying, which allow customers to decide what they want and where to get it. In effect, it gives customers choice. My right hon. Friend and I are in favour of choice and I hope that the House supports the Government on that.

Photo of Mr Tam Dalyell Mr Tam Dalyell , Linlithgow

Before a Prime Minister says such a thing, what cost comparisons are made between PSA work at Downing street and that which would be done by private firms?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I cannot go into the details of particular cases. The principle is that it should be for individual clients to decide whether they wish to use the PSA and then to invite quotations from those who may wish to tender. Following the financial management initiative, I am sure that this is becoming common practice throughout Whitehall and that as a result the Government are obtaining better value for money.

My hon. Friend the Member for Hastings and Rye (Mr. Warren) was worried about clients' responsibility for security clearances of staff and contractors. To ensure that sensitive information does not get into the wrong hands, the PSA, like all Government Departments and private sector contractors, for example, in defence procurement, has arrangements for its staff to be security cleared. More rigorous clearances are required for the most sensitive work. There is a wide range of private sector consultants who, for many years, have been carrying out many aspects of design on sensitive projects under the PSA's overall direction. For example, almost all the work of construction, other than small scale maintenance jobs, is done by private contractors. The main radioactive liquid treatment plant at Aldermaston and the floating jetty for Trident submarines at Coulport have been designed by the private sector. All the staff involved were appropriately security cleared. No security distinction is made between a design done by secure consultants and that done by civil servants.

The PSA does certain types of design, such as prisons or airfield pavements, with its own staff rather than with consultants because, over time, it has developed those areas as specialisms, not because the design has been kept in-house for security reasons.

In answer to my hon. Friend, when the PSA is privatised it will be in the same position as the consultants with whom it will compete for work and its staff will be vetted in the same way as are the staff of the present consultants. Decisions about clearance requirements will turn on the nature of the work that the PSA wins or the arrangements that its Government customers demand, since it is the client, and not the consultant, that settles the security regime to be followed.

As I said earlier, although the vast majority of the PSA's current work is such that we are confident that privatisation will have no deleterious effect on security, there are exceptions to that. There is the remaining very small proportion of work that will be retained within Government. In the case of the Crown Suppliers, a review that we carried out in 1988 concluded that some of the Crown Suppliers' work should be retained within Government. In the case of the PSA, there are one or two areas where more work needs to be done before final decisions are taken about precisely which activities should be retained in Government. The security and privacy of Her Majesty the Queen and the royal family will be an essential consideration. Other activities concern specialised work at very sensitive facilities, including the development, installation and maintenance of high security equipment that the PSA carries out for a range of Government clients.

Discussions are currently taking place with all the interested parties in Government to decide how those functions should be handled in the future. But the privatisation of the PSA cannot take place before late 1992, so there is adequate time to make sure that we take the right decisions. If it is necessary, as it may well be, to retain specific functions in Government to preserve security, we shall certainly do so. I can assure the House of that.

The hon. Member for Brecon and Radnor (Mr. Livsey) raised the issue of United States forces. I can tell the hon. Gentleman that the building work managed by the PSA, with few exceptions, is undertaken by private sector building contractors, which have far more men on site at any one time than the PSA has. The United States air force has no general security bar on the use of private contractors on its bases in relation to the sort of services that the PSA provides. Indeed, it has private contractors on its bases for a number of purposes. I know that on one base it has a private sector security agent as well. Following privatisation, the PSA will be in the same position as are the other private sector companies on those bases.

The hon. Member for Hammersmith (Mr. Soley) referred to Northern Ireland. In Northern Ireland, as elsewhere, security is the responsibility of the customer who commissions the work, rather than of the PSA. The PSA undertakes work in Northern Ireland that is not related to the security services. For example, it works for Northern Ireland Departments, such as the Department of the Environment and the Department of Agriculture, and it maintains Hillsborough castle. Those who have been to the castle recently have been much impressed by the work that the PSA has done there. It also works for the Inland Revenue and for Customs and Excise, and in the new competitive world that it now faces it could well offer very attractive services in areas in which it has skills and resources.

The purpose of clause 6(2) is to allow the PSA's organisation and facilities in Northern Ireland to be included in the privatisation. They represent a sizeable slice of the PSA's business, and Northern Ireland offers an important area of the United Kingdom where the company could seek to expand its markets.

Photo of Mr Bill O'Brien Mr Bill O'Brien , Normanton

Do I take it that the Northern Ireland Office, like the other Departments, will have its personnel—accountants, consultants, architects, the people who oversee the work—in place? Will the Northern Ireland Office have in post the same type of people as other Departments have in post?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

The Northern Ireland Office will have in post the people who are necessary. For example, the Hillsborough castle project is under the auspices of the Northern Ireland Office. That Department has a project sponsorship role. The principles that apply to the Northern Ireland Office will be the same as those that apply to other Government Departments.

Photo of John McFall John McFall , Dumbarton

The Minister says that the same principles will apply. Does that mean that, in Northern Ireland, works services will be put out to competitive tender, as happens in other parts of the United Kingdom?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

The details of how works services in Northern Ireland are dealt with have not yet been finalised. In his earlier remarks the hon. Gentleman jumped to a conclusion. No final decision has been taken about the way in which works services in Northern Ireland are to be dealt with. Obviously, security will be paramount.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

When the PSA is privatised, the people in Northern Ireland who work for it will cease to be civil servants. At present any civil servant who comes under a serious death threat in Northern Ireland can be moved, not just from his home, but to a totally different job elsewhere. When the PSA is in the private sector, what safeguard will there be?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

The hon. Gentleman speaks as if there were no private sector people working in Northern Ireland at present. Certainly the PSA people who work in Northern Ireland whom I have met, despite the threats under which they operate—and let us not kid ourselves: there are threats against PSA personnel in Northern Ireland, just as there are threats against other people there—enjoy working in Northern Ireland and wish to continue doing so. I am sure that that will continue to be the case, whether they are in the private sector or in the public sector.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

I am sure that those people enjoy working in Northern Ireland. They are also very brave. But the Minister is avoiding the question. The situation is that if one comes under a death threat, one can be moved from one's house. One can be moved to a Civil Service job elsewhere, even in another part of the United Kingdom. How could that happen if the organisation were in the private sector? In the private sector at the moment, one can be shot. Often, as happened very recently—it was reported in the press—companies withdraw from contracts. Are we going down that road? I want to know. When those people cease to be civil servants, and end up in the private sector, will they simply withdraw from the contract if they are threatened, or will there be arrangements to move them as if they were still civil servants?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

The hon. Gentleman is jumping to conclusions and is overstating his case. Indeed, he is doing so in a rather irresponsible way.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

I do not accept that. Both I and the Secretary of State have had experience of the problems of Northern Ireland. I should be quite happy if the Secretary of State were to have a word with the Minister about this matter. We know that what I have just said is factually correct in every detail. I appreciate that the Minister may not have been told what the process is, but somebody somewhere must have given this matter some thought.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I do not think that it would be appropriate this evening to go into the details of what happens at present when such a situation arises in the private sector.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

We know what happens.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I think that the hon. Gentleman is misinformed as to exactly what happens at present, as to the arrangements in particular circumstances when this occurs in the private sector. I do not think that it would be helpful to go into that tonight. Obviously, such considerations are very much in the forefront of the Government's mind in deciding what to do about privatisation of the PSA in the context of Northern Ireland. I do not think that the security of any individual in the PSA will be affected adversely by the arrangements.

Photo of John McFall John McFall , Dumbarton

The Minister has said that we are jumping to conclusions, but he is misleading the House, or talking ignorance. From public documents I can tell the Minister that works services will not be put out to competitive tender. I challenge the Minister on that point.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

The hon. Gentleman is making assertions and challenges, but I think that he is referring to a study that is now under way. The question is whether, initially, maintenance and minor works services will be put out to tender. In the first instance it is for the Ministry of Defence to consider the extent to which it will be involved in market testing. To my knowledge, no final decision has yet been taken on the matter and I believe that the hon. Gentleman is referring to speculation and studies that are now being undertaken. Ultimately, it will be for the MOD to decide how it will procure its works and maintenance in Northern Ireland. I assure the House that a decision has already been taken in principle that there will be competition for all major new works in Northern Ireland.

9 pm

To identify within legislation the security group as the part of the PSA to be retained within Government would be an imprecise and blunt instrument of administration. Currently some activities outside that group, such as emergency planning, may need to be retained within Government. Equally the review currently in progress may identify work that could readily be undertaken within the private sector.

All those issues are being reviewed and I hope that Opposition Members will accept that we treat seriously the question of where certain security activities should rest. Hon. Members will be aware that we brought into the PSA certain secure activities from the Crown Suppliers, which we thought were unsuitable within the private sector. Those and other activities in turn are likely to transfer to Property Holdings or elsewhere within Government.

I assure the House, as I did the Committee, that nothing will be done under the Bill that is against security advice. Security advice was taken in deciding those parts of the Crown Suppliers which are to be privatised and those parts which are not. We took decisions fully in accordance with that security advice. I hope that that gives confidence that we shall likewise take decisions fully in accordance with security advice when dealing with the detail of what is or what is not to be privatised in the PSA. Obviously, as privatisation is not due until 1992, there is plenty of time in the interim.

I hope that I have been able to allay hon. Members' concerns about security and that I have been able to show that the Government take the issue of security extremely seriously. The Bill in no way jeopardises that security.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

With the permission of the House, I just wish to place it on record that our concerns have not been allayed, nor are we happy about this. We do not intend to press the amendment to a Division, but this is one of the issues on which we shall press for a Division on Third Reading.

Amendment negatived.