To ask the Secretary of State for Transport whether, in the British Rail pay round, consideration has been given to a share participation scheme; and if he will make a statement.

I regret that a share participation scheme would not be possible for British Rail while it remains a nationalised industry, but this will become an attractive option once British Rail is in the private sector.

Does my right hon. and learned Friend agree that if it were possible for British Rail to be denationalised, the employees could benefit from a share option scheme? Indeed, those parts of British Rail that have been denationalised already benefit from such schemes. Will my right hon. and learned Friend confirm, for example, that at British Rail Engineering Ltd. in York, people with the same qualifications as employees of British Rail are offered a pay differential of between 23 and 36 per cent? Does not that show the way forward for British Rail, as opposed to the old-fashioned trade union policies adopted by the trade union barons?

My hon. Friend is correct. Indeed, in 1990 BREL made a free allocation to employees of some of the 20 per cent. of shares bought by managers. Clearly, it is part of any privatisation to increase the opportunities available to employees. In previous privatisations employees have always come forward enthusiastically. That is one of the main advantages of introducing an industry to the new environment of the private sector.

Mr. David—Mr. Dennis Skinner.

That is my brother; he is younger than me.

I apologise to the hon. Gentleman. He slipped my memory for a moment!

Is the Secretary of State aware that the employees of British Rail are not interested in share participation schemes? They are not interested in the offer that has been made by British Rail for their wages. They are not interested in what the Tories have to offer in respect of privatisation. They want the same kind of treatment as is being handed out in wages and conditions to the head of British Rail, who is picking up more than £200,000, and the other top directors who pocketed a 22·7 per cent increase last year. The Government should give the employees that treatment.

The chairman of British Rail is a man of exceptional ability. If we are to expect British Rail to achieve the progress that has been made in many other industries, it is crucial to ensure that the person who is attracted to take over responsibility for the industry is paid a salary commensurate with such ability. The current pay negotiations are primarily a matter for British Rail and I hope that British Rail employees will take into account the fact that inflation is now falling rapidly. That is increasingly recognised throughout industry as well as in the public sector.