Ports (Disposal of Land)

– in the House of Commons at 10:30 pm on 14 January 1992.

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Photo of Patrick McLoughlin Patrick McLoughlin The Parliamentary Under-Secretary of State for Transport 10:30, 14 January 1992

I beg to move, That the draft Ports Act 1991 (Levy on Disposals of Land, etc.) Order 1991, which was laid before this House on 5th December, be approved. The draft order makes provisions under sections 17 and 18 of the Ports Act 1991. Its purpose is to enable a levy to be applied to gains arising from disposals of land or of an interest in land carried out by the new owners of trust ports privatised under the Act, in the years following privatisation.

It may assist hon. Members if I make clear the relationship between the order and the sale of the Tees and Hartlepool port authority. In reply to a question in the House from my hon. Friend the Member for Stockton, South (Mr. Devlin), my right hon. and learned Friend the Secretary of State said on 18 December that he was minded to give his formal consent to the sale of the authority's undertaking to Teesside Holdings Ltd., but that this would be possible only after the scheme of transfer submitted by the authority under section 9(1) of the Ports Act and the order which we are debating this evening had come into effect.

The scheme of transfer came into effect on 30 December. The order relates to the whole of the ports privatisation programme, and no sales of trust ports can take place under the 1991 Act until the order is in place. Hon. Members will be aware that, since my right hon. and learned Friend made his statement on 18 December, representations have been put to him concerning the Tees and Hartlepool sale by my hon. Friend the Member for Stockton, South and other hon. Members. My right hon. and learned Friend is looking into those representations carefully and he will not take a final decision on the sale until that process is complete. I do not believe that it would be right for me to add anything further on that subject during the debate in anticipation of the conclusion of the process which my right hon. and learned Friend has put in hand.

Photo of Mr Roger Moate Mr Roger Moate , Faversham

Does my hon. Friend agree that he is saying that the decision on Tees and Hartlepool cannot be taken until the order has been passed? Is not that a strong argument for those of us who are concerned about what has happened in Tees and Hartlepool not to allow the order to go through until such time as the matter has been re-examined?

Photo of Patrick McLoughlin Patrick McLoughlin The Parliamentary Under-Secretary of State for Transport

The order is general to the whole ports privatisation programme. It is not the case that the sale could not go ahead without the order. The sale could go ahead, but it would be without the clawback provisions which I think the whole House finds desirable. This is a short debate, Mr. Deputy Speaker, and many hon. Members wish to catch your eye. I think that it would be right for me to describe the outlines of the order and then try to catch your eye later to respond to questions which are put in the debate.

The Government take the view that the sale of ports under the Act should be carried out so as to ensure that the price that is paid for them is the best open market price, subject to whatever other objectives of sale a port agrees with my right hon. and learned Friend the Secretary of State. Nevertheless, it is still possible that land that some ports hold will turn out to have a significantly higher value than was expected at the time of sale——

Photo of Patrick McLoughlin Patrick McLoughlin The Parliamentary Under-Secretary of State for Transport

I shall give way to the hon. Gentleman, but I shall not be able to respond to all the criticisms as the amount of time for this debate will have been reduced.

Photo of Dr Norman Godman Dr Norman Godman , Greenock and Port Glasgow

I am grateful to the Minister for showing his characteristic courtesy.

Does the hon. Gentleman's assessment of the sale of the English port authority hold for the privatisation of the Clyde port authority? Since that authority announced its intention to privatise itself, British Steel's director announced the closure of Ravenscraig which, together with the attendant closure of the Hunterston terminal, will have a direct bearing on the earning power of the Clyde port authority. Will the Minister give me a list later this evening of the parties that have formally declared an interest in acquiring the Clyde port authority?

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

Order. I think that the Minister may find it somewhat difficult to respond to that intervention without widening the debate beyond the scope of the order.

Photo of Patrick McLoughlin Patrick McLoughlin The Parliamentary Under-Secretary of State for Transport

I am grateful for your guidance, Mr. Deputy Speaker. I am trying to describe the order. The hon. Gentleman's comments may be the subject of legitimate debate on a wider issue and if he cares to write to me I shall try to answer his questions. I feel that I should now make some progress on the order, as I know that several hon. Members wish to take part in the debate.

If land held by some ports turns out to have a significantly higher value than was expected at the time of the sale, that will result in an excessive windfall gain for the new owner which was not foreseeable at the time of privatisation, and therefore not properly reflected in the price paid for the undertaking. The subsequent sale of such land would, of course, be subject to capital gains tax, but We consider that there should be a further levy on the enhanced value of such property to prevent the excessive windfall gains that would otherwise result.

Of course, as was made clear in the extensive debates on the Ports Act last year, one of our objectives in seeking the privatisation of major trust ports is to make it easier for them to realise the value of their property holdings, so we need to strike a careful balance between preventing excessive windfall gains and deterring the port companies from turning their property to best account. That is why the Act provides for the levy to be time-limited to 10 years after privatisation, and why it will amount to a relatively small proportion of the gains. For example, for the first five years it will be 25 per cent., and taper down to 20 per cent. in years six and seven, and to 10 per cent. thereafter—on top of the capital gains tax.

Parliament agreed to the Act providing for the limited period levy on land disposals made after privatisation. Sections 17 and 18 of the Act therefore set out the basic framework within which the levy is to operate, and the order, the draft of which is now before the House, will fill in the details.

The draft order makes provision in the following main areas. Article 6 provides that all disposals of relevant land or interest in land are chargeable disposals. They include freehold disposals, leasehold disposals and the granting of options to acquire land. There are, however, significant instances in which no gain is deemed to arise, and in which therefore no levy is chargeable.

Paragraph 4 of schedule 2 provides that the base data for the valuation of land for the purposes of levy will be the date of privatisation. That will also be the commencement date of the levy period. The base value for the land will be the market value on an existing use basis. The base value will be index-linked.

It is not intended that the levy should apply to all disposals irrespective of size, and paragraph 8 makes provision for exemptions below certain limits. First, the levy is payable on any disposal only when the aggregate value of all disposals over the whole 10-year period exceeds "an overall threshold" of £500,000, or 10 per cent. of the port sale proceeds if that is less. Secondly, individual disposals below a threshold limit of £200,000, or 2 per cent. of the port sale proceeds if that is less, are referred to in the draft order as "small disposals" and do not give rise to a levy, although they do count against the overall threshold.

Finally, individual disposals of less than £4,000, up to a maximum of 20 per year, are referred to as "disregarded disposals" and are exempted from the levy itself, do not count against the overall threshold and do not need even to be recorded. All those limits are index-linked.

Articles 18 to 26 deal with leases. Under article 25, leases of operational land used for operational purposes are also disregarded for levy purposes, since those are considered to form part of a port's normal business activities and could not on that basis be seen as giving rise to windfall gains.

Leases for non-operational purposes are not exempted, but, where they are for rent, they are subject to special provisions reflecting the fact that any gain arising is spread over a period of years. They are treated as if granted for a single premium equal to their market value, but any levy arising from them can be paid in annual instalments. In addition, article 18 effectively provides relief from corporation tax on rental income by reducing the amount of gain on which levy is payable.

Photo of Patrick McLoughlin Patrick McLoughlin The Parliamentary Under-Secretary of State for Transport

I would rather not, for the simple reason that a number of hon. Members want to speak. [HON. MEMBERS: "Give way."] However, as Opposition Members seem intent on my giving way, I am happy to do so, even thought that will give them less time.

Photo of Mr Tim Janman Mr Tim Janman , Thurrock

My hon. Friend briefly mentioned leases for non-operational purposes. I am intrigued as to why any operational lease taken out later than six months before the start of the clawback provision will be included. It means that, if a port wants to utilise land for operational purposes and increasing the entrepreneurial and useful activity that takes place in the port, it will, in effect, have to pay extra tax to the Treasury for the privilege of doing so. That strikes me as counter-productive to the aims and objectives of the Conservative party, which are to encourage initiative and risk taking.

Photo of Patrick McLoughlin Patrick McLoughlin The Parliamentary Under-Secretary of State for Transport

I do not believe that my hon. Friend's assumption is correct. We needed to strike a fair balance in terms of any windfall gain that might occur.

Photo of Frank Cook Frank Cook , Stockton North

On a point of order, Mr. Deputy Speaker. Earlier, you kindly and helpfully guided the House on the scope of the order. A question was put to the Minister relating specifically to whether or not the order's contents conformed with Conservative party policies. Is that not without the scope of the order?

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

I am sure that the Minister will remain in order when he responds.

Photo of Patrick McLoughlin Patrick McLoughlin The Parliamentary Under-Secretary of State for Transport

My hon. Friend the Member for Thurrock (Mr. Janman) was perhaps arguing that we had drawn the clawback provision for any windfall gains too tightly. Throughout the whole process, we were keen to achieve a balance in the treatment of windfall gains.

Photo of Mr Tim Janman Mr Tim Janman , Thurrock

I was talking not about windfall gains or land leased out for non-operational purposes but about leases entered into by a port post-privatisation that are for the purposes of allowing other companies to use the port's land on a leasehold basis for the importation, storage, or manufacture of products. Those are the purposes for which a port should be used. That the order does not exclude all operational leases is counter-productive to my party's aim of encouraging entrepreneurial and risk-taking activities.

Photo of Patrick McLoughlin Patrick McLoughlin The Parliamentary Under-Secretary of State for Transport

My hon. Friend and I will just have to agree to disagree on that point. We felt that it was right to achieve an overall balance between what might and might not be a windfall gain, which is why we excluded operational leases after consulting a number of the ports directly affected by the order.

The draft order contains a number of provisions intended as counter-avoidance measures, particularly where there are disposals of land or interests in land within a group of companies.

Article 33 ensures that a transfer between members of a group gives rise to chargeable gains where the holding of the parent company in its subsidiaries is anything less than 100 per cent. Article 34 enables levy to be charged on the full increase in value of assets that have been transferred to a company which subsequently leaves the 75 per cent. group, and article 35 provides for the recalculation of the gain on an intra-group transfer if, following the transfer, there is a decrease in the equity of that company held by the parent company.

Schedule 1 sets out rules for determining when disposals are to be treated as "associated". If a small disposal can be shown to be "associated" with one or more other disposals, it is their aggregate value that is taken into account in determining whether levy should be charged on the small disposal. This is intended to counter attempts to avoid clawback through the small disposals exemption by, for instance, fragmenting one large disposal into many smaller ones to the same purchaser.

In terms of the administration of the levy, provisions are made in articles 13 to 16 for payment, including the payment of interest after certain dates. Where interest is payable, the rate is reduced by an amount equivalent to the effect of tax relief. Article 17 provides for repayment by a Minister of any sums found to have been paid in error or following a recalculation. Repayment by the Minister will also carry interest from certain dates, and will apply to levy, to interest on unpaid levy or both, as appropriate.

Finally, detailed provisions are made in articles 36 to 41 for the recording of disposals, and for the provision of the information to the appropriate Minister; for assessment of levy in certain circumstances by the Minister; for the settlement of certain disputes that might arise by a referee; and for penalties in line with those already in the Ports Act 1991 in respect of the levy on the proceeds of port sales.

An earlier version of the draft order was circulated during the autumn to the trust ports that are seeking privatisation. The process proved extremely valuable in helping us to achieve a proper balance in the draft order in such important areas as the treatment of leases and the provisions for associated disposals—and I am grateful for the constructive comments made by the ports and by Conservative Members who made representations.

I am now confident that the draft order makes arrangements for the levy that adequately safeguard the interests of the taxpayer, without being unduly onerous or restrictive in regard to the operations of the privatised ports. The order is a crucial element in the ports privatisation programme. As many hon. Members will be aware, a number of the largest ports have already taken advantage of the provisions of the Act to begin the process of privatisation. Once the draft order has been approved, it will help to ensure that the interests of the taxpayer are properly safeguarded, and ports will be less attractive to those whose only interest is in realising the property value of the port in the short term.

Photo of Mr Teddy Taylor Mr Teddy Taylor , Southend East

On a point of order, Mr. Deputy Speaker. The Select Committee on Statutory Instruments reported that the order was a drafting mess and was likely to lead to a good many legal actions. Are we considering the report at the same time as the order? The Minister did not refer to the report, but I have just read a carefully argued case to the effect that the order is a bit of a mess. Is that relevant to tonight's debate, or is it not?

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

Further to that point of order, Mr. Deputy Speaker. As Chairman of the Select Committee on Statutory Instruments, may I point out that the basic part of the order relating to the type of land that was subject to the levy was dealt with by the report because of its defective drafting? Like the hon. Member for Southend, East (Sir T. Taylor), I was very disappointed by the Minister's failure to make any relevant comment—indeed, any comment at all—on the Committee's report. That is particularly disappointing in view of the fact that the House gives the Committee the task of reporting defects, of which the order provides a prime example.

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

I can confirm to both hon. Members that the Select Committee's report is relevant, and can be referred to.

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport) 10:49, 14 January 1992

I agree wholeheartedly that the whole order is a mess. It is as much a mess as the Government's entire policy on trust port privatisation. What we have just heard about the Select Committee report may well provide a further opportunity for the House to debate the implications of that policy in detail.

It is a measure of our success in Committee that we forced the Government to make the order subject to the affirmative resolution of the House. An hour and a half is not long enough to debate this controversial issue. Although we would like to amend the order, it is procedurally impossible. We cannot even throw it out, because I am sure that the Government Whips will have learnt from their experience in Committee and will make sure that they do not lose the vote today as they lost the vote on disposal and levies on clawback and land.

We make no apology for the debate on this order as it is the only mechanism available to the Opposition to expose the sheer blinding incompetence, which we have just seen demonstrated, of the Government's handling of ports policy.

When we sat in Committee last year, I do not think that even we could have anticipated the mess into which the Government have got themselves over their handling of ports policy.

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport)

Yes, it was.

It is not just the Opposition who are expressing concern about the Government's mishandling of ports policy: it is also the press and media. We need look no further than today's editorial in theFinancial Times. The work forces in trust ports up and down the country are also saying that the Government have got themselves into a mess as well as local authority leaders of whatever political persuasion. They can spot a bad egg when they see one, and this legislation and the badly drafted order are a clear example.

There is general despair at the Government's wholesale mishandling of trust ports privatisation. That extends, surprisingly, to those who have supported the Government throughout in their bid to sell off trust ports lock, stock and barrel, including land and assets that the Government do not even own. It is reminiscent of the commercial television franchise sell-off fiasco a short time ago.

Transport Ministers have got it wrong. When they got it wrong earlier this week, they went out and bought chocolates and flowers to try to put things right. I do not know whether the Minister is responsible for this fiasco. I could be generous and say that perhaps he is just a scapegoat—I will give him the benefit of the doubt—but he cannot buy himself out of this mess with chocolates and flowers.

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

He signed the order.

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport)

There is more involved. The Government have got the ports industry into a mess. The order has given us three weeks grace to hammer home a message which fell on deaf ears this time last year. It has given my hon. Friends, particularly those representing Cleveland, time to alert the local community in Tees and Hartlepool to what Cleveland county council and Labour Members warned would happen. It has given other hon. Friends—and friends who I hope will soon be honourable—time to alert Tilbury to the threat hanging over that port. It has given my hon. Friends who are concerned about Scotland time to assess the implications for the local economy of the lethal cocktail of Ravenscraig closure and trust port privatisation, should the management buy-out bid be unsuccessful.

Photo of Mr Tim Janman Mr Tim Janman , Thurrock

The hon. Lady has mentioned the best port in Britain—Tilbury, which is in my constituency. The biggest threat hanging over that port was the dock labour scheme, which we abolished and the Labour party would bring back.

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport)

I shall cover that point if I am allowed to continue. I do not intend to give way again because time is limited.

But for the order, the Tees and Hartlepool ports authority would have been signed, sealed and delivered by now. The only reason it is not is because the Secretary of State has not been able to proceed because the order is necessary for the affirmative procedure of the House.

We want to examine the Government's mismanagement and incompetence in their handling of the order. What we have seen in this instance is surpassed only by the Government's mishandling of the entire 1991 legislation. When we were discussing the Levy on Disposals of Land, etc. Order and the 50 per cent. clawback on the net proceeds of the sale, one issue on which we pressed the Government repeatedly in Committee was how the order, once introduced, should take account of the Government's professed commitment to management and employee buy-outs.

We said that such an order must be fair and must not allow huge speculative developments—we are talking about the time before the recession, or before it was admitted that the recession was upon us—and we pressed the Government on the fact that, if there was to be a commitment to management and employee buy-outs, it should be reflected in the order, and that management-employee bids should not be precluded because some companies could make a quick profit.

The order reveals a serious questioning of what I believe to be the Government's lip service to management-employee buy-outs. It shows that the Government's commitment was not real and is not real now. We know that because of the way in which events have unfolded in the Tees and Hartlepool bid. What is the point of writing into the Bill supplementary clauses relating to financial assistance to proposals to maximise employee participation in the equity of successor companies and of setting the trigger mechanisms for clawback, as we have just heard from the Minister, on land and lease disposals, which ostensibly encourage management-employee buy-outs if, by the same token, the Secretary of State is not immediately mindful to go ahead and approve the bids outstanding in Cleveland—[HON. MEMBERS: "Go on reading."] I shall not accept any further interventions. The order raises questions that the Minister must answer. Hon. Members talk about reading—they should have asked the Minister why he did not depart from his brief.

There are serious allegations of fraud, bribery and corruption in the Tees and Hartlepool bidding. They have been raised by my hon. Friends the Members for Middlesbrough (Mr. Bell) and for Langbaurgh (Dr. Kumar) in Cleveland. The Minister should comment on that. He must also say why, when I asked on 19 December if he would undertake a full investigation of the circumstances of the sale of the Tees and Hartlepool trust board, he replied that there was no need for such an investigation.

What has happened in the meantime? Was it the representations made by my hon. Friends? How has it been possible to move the goal posts halfway through selling off Tees and Hartlepool? Should there not be an inquiry? Are we not in an even worse position now than yesterday, since we have learnt, courtesy of the Financial Times,that the Government now propose to prevent any information from coming into the public domain? What does it say about the state of our democracy if hon. Members are not allowed information about other bids to consider the implications of what has happened with regard to Tees and Hartlepool?

Photo of Mr Tim Janman Mr Tim Janman , Thurrock

What has that to do with the order?

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport)

It has everything to do with the order, because the order has so far prevented the sale from being signed, sealed and delivered.

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport)

The Minister shakes his head, but he knows that that is so.

There are further issues. We are told that the Government are concerned that the bid should have gone ahead, yet on Teesside the company that the Minister has thought until now to accept told the work force that, if the proposal went ahead, staff could subscribe up to a maximum of £2,500 in £1 shares. Does the Minister not understand that, although the solicitors admitted that the statement was legally factual, it would be the case only if approximately one in seven of the work force took up the offer? In discussing the issue within the terms of the order, we are raising questions about the Government's approach to Teesside and to Teesside Holdings, whether companies which make such false promises are fit to run our ports and whether a Government who support such behaviour are fit to handle our transport policy.

We hear about ways in which assurances have been given by Teesside Holdings on trade union recognition. To my knowledge, no consultation has taken place. Perhaps the Minister can deal with that issue.

The order raises other issues, not least the port of London and Tilbury. As promised, I come to that aspect now. Before you rule me out of order, Mr. Deputy Speaker, I must say that the matter is relevant because the Minister needs to explain to the House how the order is relevant to Tilbury. Tilbury is not covered within the terms and references of the legislation, but what happens in Tilbury will depend very much on and will be guided by the order.

The Port of London paid extensive amounts in compensation under the dock labour scheme. It is important that the Minister should say whether it is in respect of that debt that the port of Tilbury is being treated differently as regards the order and the clawback arrangements for land and lease disposals.

There are other relevant issues. The Minister should tell us how the order affects Tilbury and he should clarify whether the debenture arrangements will be based on the clawback order. Will he clarify the basis for the debenture arrangements? What will happen to the revenue generated by the sale of land and leases relating to the port of Tilbury?

The order gives us the opportunity to ask whether the Minister has approved the scheme to transfer the assets of the port of Tilbury to the Port of Tilbury London Ltd Was not the deadline supposed to be 31 December 1991? Has the Minister delayed the transfer scheme and, if so, why? Is it because of the comments made by the hon. Member for Thurrock (Mr. Janman) about his concerns about the way in which the leases have been dealt with under the clawback scheme and about the implications for the viability of the port of the operations being excluded——

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport)

The hon. Gentleman will have an opportunity to raise his concerns.

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

Order. The hon. Lady has made it clear that she will not give way.

Photo of Mr Tim Janman Mr Tim Janman , Thurrock

On a point of order, Mr. Deputy Speaker. Is it in order for an hon. Member to put words into the mouth of another hon. Member and then not to have the courtesy to give way?

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

That is a matter for debate; it is not a point of order.

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport)

I was simply referring to the hon. Gentleman's earlier points in relation to my comments about Tilbury. He will no doubt have an opportunity in the debate to raise the issues of concern to him.

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

Order. If the hon. Gentleman hopes to catch my eye, he is not improving his chances.

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport)

It is also important that the Minister should tell the House whether the reason for the delay is that the bidder is seeking to avoid meeting the legal costs incurred as a result of the industrial tribunal's unanimous decision to recommend that the 12 sacked shop stewards should be re-engaged and that a further seven sacked shop stewards should be entitled to full compensation. I have before me the report of what must have been the longest industrial tribunal hearing in history. We need to know whether the delay since 31 December has been solely the result of the new owner trying to avoid having to meet the legal costs. I remind the Minister that the Department and the Secretary of State are responsible for overseeing the board. How can a Minister or Secretary of State ignore the ruling of an industrial tribunal in this way? All those matters are relevant to the present order, Mr. Deputy Speaker.

Has there been full consultation on the operational issues, which need to be taken on board?

The order deals with finance. It is complicated and badly drafted, and shows the Government's incompetence. As a result of the Government's complete mishandling of trust ports policy, none of us can have any confidence in the way in which they are running their ports and their transport policy. Opposition Members will vote against the order when the time comes.

Photo of Mr Timothy Devlin Mr Timothy Devlin , Stockton South 11:06, 14 January 1992

I rise to speak this evening because, as the House may be aware, on 18 December I asked my right hon. and learned Friend the Secretary of State a question about the disposal of the Tees and Hartlepool port authority. In the last paragraph of his reply, my right hon. and learned Friend wrote: I am minded to give my formal consent to the sale of the authority's undertaking to Teesside Holdings Limited as soon as I am able to do so. This will be possible only after the scheme of transfer submitted by the authority under section 9(1) of the Ports Act 1991 and the order providing for a levy on disposals of land to be made under section 17 of the Act have come into effect. The latter is subject to an affirmative resolution of the House and is expected to be debated immediately after the Christmas recess."—[Official Report,18 December 1991; Vol. 201, c. 164] That is the order before us.

The present levy comes on top of a 50 per cent. levy on the disposal proceeds of the port. The combination of the levy on the land and the levy on the disposal assets of the port has already created some confusion among those involved in the bidding for the Tees and Hartlepool port authority. One of the bidders—indeed, the successful bidder—apparently had to have the sales proceeds provision explained to him twice to enable him to advance a bid which was acceptable as a final bid and which, in fact, became the successful bid.

As Conservative Members have argued on many occasions, there were three reasons for privatisation: first, to widen the powers of the port authority; secondly, to widen the share ownership by giving a substantial block of shares—I lay heavy emphasis on the word "substantial"—to the management and employees of the port; and, thirdly, to raise proceeds of sale revenue for the Government. Those three objectives were set out clearly in the sale of undertaking notices placed by the board's advisers in the national newspapers and magazines. The first stated quite clearly that the authority was prepared to consider financially competitive offers from parties who can satisfy the privatisation objectives", the first of which was to have particular regard to the desirability of encouraging the disposal to managers and staff of the whole or a substantial part of the equity share capital of its privatized undertaking". My hon. Friend the Member for Faversham (Mr. Moate) was quite right in his assertion that without the order that disposal could not take place, but it appears that in the case of the Tees and Hartlepool port authority the key objective has not been the one followed by the port. I was interested to hear that the Minister was minded to accept the board's recommendation, but it came as a considerable surprise to the management and employees of the Tees and Hartlepool port authority, and as a considerable shock to Conservative supporters of privatisation, who had close liaison with the management-employee buy-out team at every stage of the process.

Indeed, this management were the first in the country to put forward a privatisation measure in the form of a private Bill. It will be remembered that it was Opposition Members who opposed that Bill at every stage and that it was the Labour-controlled Cleveland county council that felled it when it was being considered in another place. When the Government introduced their own Bill for the disposal of all the ports, Labour Members voted against it, just as the attractiveness of these undertakings, which was underpinned by the Dock Work Act 1989, is ignored by all Opposition Members. Therefore, it ill behoves those hon. Members to present themselves now as the champions of the management-employee buy-out team.

During this privatisation the objectives seem to have altered. Originally, there were three; now there are eight, and they are more complicated. It appears that, during the privatisation, the indicative bidders were under the impression—having been so advised—that the price was only one of the criteria. When it came to final bids, however, it was taken to be the leading criterion. Each of the indicative bidders was advised by KPMG Peat Marwick, the advisers to the port authority, as to the deficiencies of their bids. In the case of the management-employee buy-out team, there were very few deficiencies. In fact, a very small increment was applied to the price that had been offered. Apart from that, the team's bid, which was the highest indicative bid, was to all intents and purposes nearly perfect.

As I pointed out, one of the other indicative bidders had to have the matter of the proceeds of sale explained again. That bidder then put forward a revised bid considerably bigger than that of the management-employee buy-out team. Had the price been signified to the management-employee buy-out team as the most significant criterion, it would have been open to the team to introduce equity partners, as the other bidders did. Together with those partners, the team could have submitted a very much larger bid. Indeed, I have been told by the leader of the team that it would have been able to submit a bid of about £190 million—in excess of the apparently winning bid.

I wish to confine my remarks to the bidding process that was followed. I do not want to become involved in mud-slinging against any of the bidders—something that has been done in the regional press—nor do I want to become involved in the records of individuals, against some of whose names are marks that have been flagged up by Opposition Members. I am sure that Opposition Members agree that, after a very long time, any person should be given the benefit of bygones being allowed to be bygones.

It is ironic that those who held up the torch of enterprise in the north-east of England should have it snatched from them as a reward for their endeavours. It is a source of great regret to me that that should have happened. The effect on the other port authorities which are now seeking to privatise themselves—for example, Medway, Clyde and others—is that they will be considerably more reluctant to go down the path of privatisation because they have seen what has happened to Tees and Hartlepool. After all, as we all know, turkeys are hardly likely to vote for Christmas. In the words of my constituent, Mr. Hutchinson, "If that is not cheating, what is?"

Photo of Frank Cook Frank Cook , Stockton North

Is the hon. Gentleman trying to say that, perhaps, Opposition Members who voted against the original legislation were wiser on that occasion than he has been on this occasion?

Photo of Mr Timothy Devlin Mr Timothy Devlin , Stockton South

No. I do not think that there is any wisdom in allowing a port to build up a huge cash balance which it cannot spend on benefits to a local community simply because its powers are curtailed. That is exactly what was resisted by all Opposition Members.

If I may briefly sum up before any votes are cast on this important order, I am grateful to my hon. Friend the Minister for his opening comments. He said that he would look again at the process by which the Tees and Hartlepool port authority bids have been received and dealt with by the board. Of course, everyone on Teesside will accept that, if there is a preferred bidder and the board is very much behind that bidder, it would be very difficult for the Government to go against that bid.

Everyone understands that, if the Government picked the lowest bidder, Opposition Members would accuse us of giving the port to our friends. That simply cannot be the case. If there has been some irregularity in the mode by which the bids have been received and if unfair opportunities or, perhaps, not fair opportunities have been given to particular bidders, I would ask my right hon. and learned Friend the Secretary of State to look at the matter again and to give all those bidders a fair chance once more.

Photo of Mr Edward Leadbitter Mr Edward Leadbitter , Hartlepool 11:16, 14 January 1992

I want to reiterate the stand that I have taken for a number of years. I am totally opposed to the privatisation of the ports that are affected by the Ports Act 1991. I make it abundantly clear also that the order is a mish-mash of incompetence. It is typical of the arguments that have been used by the privateers for many months. The privatisation supporters have found, even at this time, great embarrassment arising from the fact that, in respect of other legislation in recent months, there has been a need to rush through the processes of the House in such a manner that there has not been a proper in-depth examination of the consequences of the relevant policies.

The hon. Member for Stockton, South (Mr. Devlin), who will no longer be with us fairly shortly, referred to the loss of a Bill which was part of this argument and which related, of course, to the order, as I shall show, in a way that suggested that he wants to avoid the truth of what actually happened. The hon. Member for Hartlepool prefers to use the record. The Tees and Hartlepool port authority, the promoters of the private Bill, or the hon. Gentleman, even after my request to that authority, have not published the findings of the House of Lords Select Committee. Under a special heading, "Opinion of the Committee", the Committee stated: The Committee does not believe that the promoters have proved their need for this Bill…the promoters have not convinced the Committee that the reconstruction of the Port Authority as a Companies Act company in the way proposed is the right way to achieve this end. Nor have they persuaded us that it would be right to give them the very wide powers they seek. Those powers are not dissimilar to the wide powers under the Ports Act.

The Select Committee report continued: It would thus be possible for the privatised Authority"— the promoters— to undertake commercial activities of which it has no experience … such risks"— that is, inviting predators— could have a detrimental impact on local industry and on the local economy…For the reasons set out in this report the Committee do not consider that it is expedient for the bill to proceed. That deals with the case of the hon. Member for Stockton, South. The arguments that I have just outlined are not my opinions, but those of the House of Lords Select Committee, on which there is a Conservative majority, as there is in this Chamber. The THPA even refused to publish those significant details.

On 18 December, in response to a question from the hon. Member for Stockton, South, the Secretary of State rightly published a precise and clear statement, which read: the Department and its advisers kept closely in touch with the THPA board as it carried out the sale process. I am satisfied that the board discharged its responsibilities in a fair and in a proper manner and, in particular, I am satisfied that it considered carefully each of the bids in relation to the agreed objectives of sale. The Secretary of State concluded that letter by saying that the transfer scheme and this order are the preliminaries which are necessary before he can make a formal statement of consent. Therefore, the order is relevant to his emphatic declaration that he was satisfied that everything was carried out "in a proper manner".

As has been said, on the following day, in answering a question about the complaints that had been received, the Secretary of State made it quite clear that there was no reason to carry out any further investigation. In my view, he was right then, and he was convinced then. Since then, however, after the complaint had been deposited, the chairman of the THPA has issued a letter to every employee, making clear the reasons why the board decided to recommend the bid that was put to the Secretary of State. The wording of that letter shows his concern about the way in which some of the complaints have been dealt with.

After the tabling of those complaints, in the full knowledge that the Secretary of State was aware of them, and bearing in mind the statements of 18 and 19 December 1991, I wish to make it abundantly clear to the Minister that I shall not make any comments on those complaints, because I recognise from his statement that, as a matter of courtesy, he will consider them, although he will not necessarily agree with the recommendation that was put to him. However, I advise him that John Peart, the chairman of the port authority board and of the reconstruction committee, remains adamant that the proper procedures, laid down in agreement with the Department, were carried out. In addition, Peat Marwick McLintock, the port authority's auditors for many years and responsible for handling the day-to-day administration of the sale, have made it clear in writing that the proper objectives and conditions of sale were met. Furthermore, Mr. K. Fletcher, a partner of Jacksons, the board's legal advisers, is adamant that the proper procedures were carried out.

Indeed, the Minister for Shipping has confirmed in writing his satisfaction about the way in which the sale procedure was carried out. That letter is dated 9 January, which is after the complaints were deposited. He made that point clear to me because I had been concerned to ensure that the proper procedures were carried out. He said: both officials of this Department and Price Waterhouse, our advisors on the sale, monitored the process closely. The Department issued clear guidelines to the trust ports on the conduct of such sales, including the release of information. Price Waterhouse tell me"— that is, the Minister for Shipping— that the complaints made to them were satisfactorily resolved. In that case, the Minister has a problem on his hands. He has rightly gone no further than to say that he will consider the complaints. He has not said one word about reviewing the recommendation made to him. Therefore, I accept that position.

The Minister has many advisors and gave a commitment in writing that he was satisfied with their advice. He knows full well that he has said to the House and to the country that he is satisfied that there was a continuing close working relationship between his advisors and the port authority. In that circumstance, and as others supported the view that the procedures were followed, if on considering the complaints the Secretary of State had doubts for one moment, he was virtually telling people with years of integrity and a good reputation of serving his Department and the board that they were not telling the truth. That is a serious matter.

Photo of Mr Barry Field Mr Barry Field , Isle of Wight

Following the hon. Gentleman's argument, does he agree that the Tees and Hartlepool port authority was very much the architect and engine of this legislation? It was the first of the trust ports to go for privatisation under the Bill. It is worth commenting that perhaps the procedures and the way in which the privatisation has developed did not conform to the original objectives of the private Bill that the authority promoted. The authority's Bill was for a management-employee buy-out. Does he agree that in those circumstances, and given my hon. Friend the Minister's statement, the Minister is wholly justified in looking one more time at the parameters of the bids to see whether, as my hon. Friend the Member for Thurrock (Mr. Janman) mentioned, they cannot be fitted into the philosophy of privatisation so that employees can share in the wealth that they create?

Photo of Mr Edward Leadbitter Mr Edward Leadbitter , Hartlepool

It would be difficult to have a re-run, knowing full well not only the statutory requirements but the obligations in any tendering process followed by any utility and especially by the Government in this form of privatisation in which bidders are invited. Having been satisfied that the procedures were followed properly, it would be wrong to have a re-run on the basis of complaints that have already been rebutted in writing by the Department, the Minister, the board and everyone who gave financial and legal advice.

Photo of Mr Edward Leadbitter Mr Edward Leadbitter , Hartlepool

I shall not give way—I will simply respond to the question.

As for the Tees and Hartlepool port authority being the architect, I am sorry to say that the promoters of the private Bill made up their minds in June 1988, but they did not tell anyone until November, three or four days before depositing the Bill on the closing day. They did not consult anyone. They did not consult the county council or Members of Parliament. They simply introduced the Bill. In my experience, it is the only Bill on which the promoters had no independent professional witness. I read out to the House the findings of the House of Lords. If the authority was the architect, it was the architect of its own failure. It was reticent in seeking advice on a Bill which was proven to be ill drafted from the beginning to the end.

Photo of Mr Barry Field Mr Barry Field , Isle of Wight

It is extraordinary that such a long-established and respected Member of Parliament should tell Conservative Members that there is no way in which the employees of the Tees and Hartlepool port authority should share in the flotation of their company. I chaired the Committee that considered the private Bill which I believe was the architect of this legislation. I assure the hon. Gentleman that many expert witnesses came before us, not least from the Department of the Transport. There were serious question marks about the true legal status of trust ports. That is why there is good reason for re-examining the position in which we find ourselves.

Photo of Mr Edward Leadbitter Mr Edward Leadbitter , Hartlepool

I merely say that the port is in desperate need of an early decision. The uncertainty has gone on long enough, and it is doing harm to the port. If the Government find that objectives have been met, a re-run will do more harm than good.

It is unfortunate that debates of this sort are so short. It is not fair to those who occupy the Government and Opposition Front Benches. The matters under discussion have wide implications. I shall continue my correspondence with the Department in a reasonable way on the basis of fact and not of innuendo and suggestion. I shall seek to promote the interests of the port. I made it abundantly clear that, following privatisation legislation, I would work with the successor company to try to ensure success. Perhaps that was going too far for a good socialist, but I meant what I said. I want to see a decision made and silly complaints put aside. Let us get on with implementing decisions which were deemed to have been arrived at properly.

Photo of Mr Tim Janman Mr Tim Janman , Thurrock 11:31, 14 January 1992

First, I congratulate my hon. Friend the Minister and the Government on taking the opportunity, when considering the Ports Bill on Report, to change the clawback provisions as set out when the proposed legislation was first published. I refer specifically to removing deemed disposals from the clawback provisions and taking up the idea, which I and my hon. Friends introduced in Committee, of a sliding scale of percentages for the clawback levy over 10 years. On behalf of the port of Tilbury, I thank my hon. Friend the Minister for pushing through the idea that I and my hon. Friends advanced.

It is important that anything that is done for the ports is undertaken in the spirit of encouraging initiative, risk-taking and entrepreneurial activity. It is important, of course, that we do nothing to reduce the chances of such activity taking place. I wish to correct the implication of the hon. Member for Stoke on Trent, North (Ms. Walley) that I have been suggesting that the slight imperfections that I detect in the order will undermine the viability of the port of Tilbury. That is nonsense. The viability of the port would be undermined by a continuation of the dock labour scheme. That would be a continuation of the counter-productive and cynically negative activities that the shop stewards at the port used to get up to. That is what would undermine the port's viability.

Photo of Mr Tim Janman Mr Tim Janman , Thurrock

Indeed—my hon. Friend is absolutely right.

I am concerned about some parts of the order. When the consultative draft order was published, I think that it is fair to say that it took everyone by surprise in the industry. That was because it included a clawback provision for not just the sale of land where there would be a windfall profit, but also a provision for the leasing of land.

My hon. Friend the Minister is aware that I wrote on 20 November 1991 to the effect that I was very concerned about what seemed to be the inclusion of leases where land was to be used for operational purposes—not for property development or the like, but directly related to normal, traditional port activities, or for the manufacture of goods and services within the confines of the port.

I wrote to my hon. Friend on 20 November expressing my concern; my hon. Friend the Member for Teignbridge (Mr. Nicholls) did likewise. In his reply, the Minister implied that operational leases would not be included in the provisions of this order. He said: leases of land which have been used for operational purposes during the six months immediately before the levy period are to be exempted from clawback. That is welcome, but since the abolition of the dock labour scheme—there is an ever-increasing amount of empirical evidence that abolition was right for the British ports industry—a great deal of new business has been coming to ports such as Tilbury in each quarter.

It is all well and good excluding operational leases in existence up until the six-month period before the port becomes a plc and therefore up until the six months before the levy period starts, but what about operational leases entered into in the following six months? And what about operational leases entered into after privatisation, once the port has become a plc and the clawback levy period has started?

If my hon. Friend suggests that there is a problem with defining operational and non-operational leases, that is invalid. He had no difficulty in his letter in defining an operational lease for the period up to six months before the levy period starts. He stated: The definition of land used for operational purposes used in the draft order follows the definition of port operational purposes used in the Town and Country Planning Act General Development Order 1988. So we have a good definition of a lease for operational purposes. If that definition can be used for the period up to six months before the levy period begins, it can equally be used for leases within the six-month period and after the levy commences.

There are good grounds for my hon. Friend to re-examine this matter. Including such leases under the clawback provision is not fair to the port and is counter-productive to our aims and objectives.

The wonderful extrapolation by the hon. Member for Stoke-on-Trent, North—that I suggest that the order will undermine the viability of the ports—is of course quite wrong. Compared with the positive aspects of the Ports Act and of the abolition of the dock labour scheme, the negative aspects of this order are small indeed, but if we are to help our ports into a far more entrepreneurial environment, we should take every opportunity to maximise such development.

Earlier today, I had a debate on the telephone with one of my hon. Friend's officials about this subject. The first argument put to me to defend the inclusion of operational leases is that, after the port is sold and if there is wasteland in the port that it wants to develop for operational purposes, the price of that wasteland will reflect its value when the port is sold.

That is rather like saying that, if I buy a house from someone and use my money and initiative to improve that house, or if I lease out a wing of the house and someone else spends money on improving that wing, I should then pay a tax to the person from whom I bought the house. Yet that is what the order stipulates.

Nor is it reasonable to say that, because the port will get relief on the costs of doing whatever has to be done to that land to turn it into whatever it is to be used for, it will neutralise the extra clawback levy that the port will pay. If the port is to retain the freehold and is only leasing the land to somebody for operational purposes, it is often not the port itself that will incur the costs of what has to be done on the land to turn it into whatever it has to be turned into: it will be the person who is leasing the land who will bear those costs. Therefore, the benefit of the relief will not accrue to the port, yet the port will still have to pay a levy because it has leased the land for operational purposes.

Time is short and other hon. Members wish to speak; I hope that the debate will not be hijacked for the purpose of a debate about Tees and Hartlepool. The order is important. I do not wish to oppose the order, because it is only one facet of the overriding objective, which is to get ports like Tilbury into the private sector quickly so that they can be run efficiently in a spirit of enterprise and risk-taking, but unless my hon. Friend has the opportunity at the end of the debate to reassure me on my concerns about the order, equally I do not think that I can go into the Aye Lobby either.

It is important to take measures to make sure that windfall gains are properly taxed, but equally it is important not to put through the House an order which in some way, however small, will create an unnecessary barrier to the risk-taking and entrepreneurial activity that we wish to see in our ports.

Photo of Jim Wallace Jim Wallace , Orkney and Shetland 11:41, 14 January 1992

I will try to be brief because other hon. Members, some with constituency interests, wish to speak. When the section under which the order is being made came before the House on Report, it did so after a defeat in Committee. At that time my right hon. and hon. Friends supported the clause. We felt that, if a port had been transferred into the private sector, and there were windfall gains, it was not unreasonable, in order perhaps to discourage land speculation, that some of the gains should be taxed.

We would argue again that, if there were a windfall gain to be taxed, it should not necessarily be the Government who would benefit from the windfall. It is not unreasonable that some of the revenue from the levy should be reinvested in the community of the port where the tax was raised, not least given the amount of investment which the community would often have to make—for example, in the road infrastructure to support the port. Therefore, when we have an order implementing detailed parts of the section, it might be perverse to oppose it in principle.

That said, I think that the Minister owed it to the House to respond to three points made in the report of the Select Committee on Statutory Instruments. First, there is the failure in article 25(2) to define a precise time when land use for non-operational purposes begins. Secondly, there was no understanding among those who gave evidence to the Committee about what was meant by a tested telex.

Thirdly, the Committee was concerned about the loose drafting of article 36. Is there or is there not a requirement to furnish documents under that provision? As the Committee pointed out, there are penal provisions attached to the failure to provide such documents. Therefore, the circumstances in which they ought to be provided should be clear. I hope that the Minister will respond to the serious points raised by the Committee.

There are hon. Members from the Tees and Hartlepool district who wish to make important constituency points. I shall make two related observations. First, on a number of occasions in Committee and on Report the Minister said that one of the Government's objectives in supporting the privatisation of ports was to encourage employee and management buy-outs.

In Committee on 12 February, in response to a question from the hon. Member for Faversham (Mr. Moate), the Minister said: The ports would have objectives that would need to be agreed with my right hon. and learned Friend the Secretary of State. They would need to include obtaining the best price for the port, taking into account other considerations such as future plans for the port, and employee-management participation levels."—[Official Report, Standing Committee D, 12 February 1991; c. 45] That was embodied in section 5(3) of the Act, which states that the Minister shall have particular regard to the desirability of encouraging the disposal of the whole or a substantial part of equity share capital to management-employee consortia.

Photo of Jim Wallace Jim Wallace , Orkney and Shetland

I wish to be brief, so I will proceed.

Clearly, the Secretary of State is minded to approve the scheme for a port with only a 5 per cent. equity holding for employees or management, which is not what any of us understood by the substantial encouragement of which the Minister spoke when the Bill was being discussed.

I am sure that, if the hon. Member for Greenock and Port Glasgow (Dr. Godman) has a chance to speak, he will wish to comment on the proposals for the movement to the private sector of the Clyde port authority, where those who have been the driving force behind the privatisation measure have placed considerable emphasis on encouraging an employee-management buy out. What price is to be paid for their encouragement for that option now, and for the other factors that they are said to have agreed with the Government in relation to the need to maintain substantial control of that company in west central Scotland?

Yesterday's Financial Timesreported that, to avoid future embarrassment, the Department of Transport has put a blackout on any information on the bids tendered for further privatisations. In a document that I received yesterday, the Secretary of State for Transport said that he was once a supporter of freedom of information. That claim looks pretty hollow when we hear that a blackout has been placed on information for no other reason than to cover up future embarrassment caused to the Department of Transport. That is no reason for the secrecy. I hope that when the Minister replies he will say that the Financial Timesreport is incorrect and that openness will be the hallmark of future privatisations of ports wishing to take that option.

Photo of Mr Roger Moate Mr Roger Moate , Faversham 11:47, 14 January 1992

The hon. Member for Orkney and Shetland (Mr. Wallace) was right to remind the House that the order comes before us partly as as result of a vote in Committee on an amendment moved by my hon. Friend the Member for Thurrock (Mr. Janman), which inflicted a defeat on the Government. As a result of that vote, the proposals are much less harsh than they might have been, in relation both to the period in which the clawback provisions apply and to the rate of levy that applies. On that occasion, we were supported by the Opposition, but it is a mark of their confusion that, having secured that excellent result, they are now going to vote against it.

However, we should not be surprised at that, because the Labour party was confused on the major issue of the ports levy, which was set at 50 per cent. Its members tabled an amendment to increase that level to 100 per cent. and then voted in support of an amendment that successfully reduced it to 10 per cent. That shows their total confusion on the matter, so nothing should surprise us this evening.

I warmly welcome the principles of the order, but I am tempted by the Minister's express statement—I think that the record will show that I am right—that the Tees and Hartlepool bid could not be finally consummated until the order was passed. If that is so, it is proper to say that we should perhaps defer the decision until there has been ample time to review it, as it might well prove an unfortunate one.

I understand and respect the point made by the hon. Member for Hartlepool (Mr. Leadbitter), that indecision must be unhelpful to the port, but we are entitled to be worried, for the reasons so properly expressed by the hon. Member for Orkney and Shetland. We incorporated through amendments supported by both sides of the House provisions for substantial management-employee participation. We were assured again and again that that was a primary objective. In fact, I understand that the criteria used in the management-employee buy-out bid were guided largely by the views expressed by the House.

I understand also that the employee bid was for 100 per cent. of the equity, but that the successful bidder is offering only 5 per cent. participation to management and employees. The order is part of a whole package of measures designed to help the management-employee buy-out.

The House went further. A specific provision giving some advantage to management and employees was incorporated, but I understand that that has been interpreted as just a 5 per cent. price advantage, which I do not believe accurately reflects the intentions of the House or the assurances given by Ministers.

It is hard for right hon. and hon. Members to judge whether the bidding process was totally fair, unfettered, and proper in every respect, Perhaps it was. However, I believe that other ports and the public are entitled to be worried.

I hope that my right hon. and learned Friend the Secretary of State for Transport will carefully examine the whole process—the first in the chain—to determine whether it should not be thoroughly reviewed, perhaps even with a view to going through the bidding process once again or moving to the alternative of flotation. It is vital that the ports industry should get it right, and many of us feel at this moment that it has not done so.

Mr. McLoughli:

rose——

Photo of Dr Norman Godman Dr Norman Godman , Greenock and Port Glasgow

On a point of order, Mr. Deputy Speaker. I seek your advice, because my genuine view is that the House has been given insufficient time to debate this important issue.

I refer you, Mr. Deputy Speaker, to Standing Order No. 14(1)(b), which states inter alia: Mr. Speaker shall put any questions necessary to dispose of such proceedings not later than half-past eleven o'clock or one and a half hours after the commencement of those proceedings, whichever is the later: Provided that, if Mr. Speaker shall be of the opinion that, because of the importance of the subject matter of the motion, the time for debate has not been adequate, he shall, instead of putting the question as aforesaid, interrupt the business, and the debate shall stand adjourned till the next sitting". I ask you, Mr. Deputy Speaker, in all conscience to adhere to that Standing Order and to adjourn the debate at midnight.

Photo of Mr Harry Ewing Mr Harry Ewing , Falkirk East

Further to that point of order, Mr. Deputy Speaker. My hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) raises an important point. I accept that there is a serious problem in the Tees and Hartlepool port authority area. My hon. Friend the Member for Langbaurgh (Dr. Kumar) and others of my hon. Friends were unsuccessful in catching your eye tonight, Mr. Deputy Speaker—but not because you did not want to call them. The Minister rose to reply, and my hon. Friend the Member for Langbaurgh, who could have made a major contribution to the debate, was prevented from doing so. No reference has been made to two major port authorities in Scotland—Forth, located in my constituency, and Clydebank. My hon. Friend the Member for Greenock and Port Glasgow is right to submit that, under the Standing Orders, you should exercise the power vested in you to adjourn this debate until tomorrow or the next convenient sitting.

The Minister is laughing, but this is no laughing matter. It is a very serious matter when my hon. Friend the Member for Langbaurgh and the interests of two important Scottish port authorities are excluded from the debate—not at the will of the Chair but because only a restricted amount of time had been allocated to debate the issue.

I ask you, Mr. Deputy Speaker, to exercise the power vested in you and to adjourn the debate.

Photo of Mr Teddy Taylor Mr Teddy Taylor , Southend East

Further to that point of order, Mr. Deputy Speaker. I have here the report of a Select Committee which sat for a full day and which concluded that the order was defectively drafted in three respects. If we are to end the debate with no reference to that conclusion being made by the Government, are we not failing to do our job?

Do you think that Standing Orders should be treated seriously, Mr. Deputy Speaker? Do you think that they are more than just a load of codswallop? If so, I suggest that you take account of the fact that, in a debate lasting an hour and a half, not one reference has been made to the conclusion reached by a Committee consisting of four hon. Members—who had considered the order for a full morning—that it had been defectively drafted.

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

Order. The hon. Gentleman is now raising a point for debate, not a point of order for the Chair.

Let me respond to the two earlier points of order. Unfortunately, it is often impossible to call every hon. Member who wishes to speak in debates on orders lasting for an hour and a half. Tonight's circumstances are therefore not unusual. I must tell the hon. Members concerned that I am not prepared to grant their requests.

Photo of Joan Walley Joan Walley Shadow Spokesperson (Transport)

Further to that point of order, Mr. Deputy Speaker. I have listened carefully to what you have said. However, given the number of hon. Members on both sides of the House who wished to speak, and whose constituencies contain trust ports—hon. Members such as my hon. Friend the Member for Langbaurgh (Dr. Kumar) who have spent a long time preparing for tonight's debate—and given the points that have been raised, will you at least tell us whether you will discuss the matter with Mr. Speaker and give a further consideration, if you cannot give a ruling now?

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

This is a matter for the discretion of the Chair, and I have given the House my decision.

Photo of Stuart Bell Stuart Bell , Middlesbrough

On a point of order, Mr. Deputy Speaker. May I seek your guidance on an entirely different point? We should like some guidance on the principle of ministerial statements.

My hon. Friend the Member for Hartlepool (Mr. Leadbitter) read out the response given to a private notice question asked by the hon. Member for Stockton, South (Mr. Devlin). In his response on 18 December, the Secretary of State said that he was minded to accept the recommendations of the Tees and Hartlepool port authority. The Ports Act 1991 was perfected on 31 December.

The Minister is right to say that tonight's proceedings are not relevant to the Act or to the decision in relation to the Tees and Hartlepool port authority. However, tonight he made a statement to the House that conflicted with his response to the question asked by the hon. Member for Stockton, South. He said then that he would look carefully at all the representations that had been made and that until he had completed the process he would not endorse the recommendations. He therefore made a ministerial statement to the House without the application of the normal convention that Opposition Members can put questions to him. We, as Back-Bench Members, have been deprived of our right to demand a ministerial statement and the normal cut and thrust of debate.

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

Order. The hon. Member is making a speech in the guise of a point of order. I call the Minister.

Photo of Mr Harry Ewing Mr Harry Ewing , Falkirk East

On a point of order, Mr. Deputy Speaker. Am I right in assuming that the Minister must seek the leave of the House to address the House a second time?

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

Not on this occasion.

Photo of Patrick McLoughlin Patrick McLoughlin The Parliamentary Under-Secretary of State for Transport

What we are witnessing is Labour's total opposition to the privatisation of trust ports. Labour Members hide behind the mask of support for management-employee buy-outs; yet, whenever we have debated this question, they have used every possible opportunity to obstruct the process of the sale of trust ports. Now they are shedding crocodile tears because they have not received some of the answers that they wanted.

As made clear, my right hon. and learned Friend the Secretary of State is looking into the representations carefully and he will not make a final decision on the sale until that process is complete. I do not believe that it would be right to add anything further to that subject now.

It has become clear from the debate that the Opposition are determined to oppose the privatisation of trust ports. They are now trying to hide behind that by saying that on every occasion we should provide an option for a management-employee buy-out, irrespective of the price. If we had considered doing that, the labour party would have accused us of selling off assets on the cheap as it has on many occasions in the past.

It being one and a half hours after the commencement of proceedings on the motion, MR. DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 14 (Exempted Business).

Question put:

The House divided: Ayes 244, Noes 136.

Division No. 37][12.00
AYES
Adley, RobertCouchman, James
Alexander, RichardCran, James
Alison, Rt Hon MichaelDavies, Q.(Stamf'd & Spald'g)
Allason, RupertDavis, David (Boothlerry)
Amos, AlanDay, Stephen
Arbuthnot, JamesDevlin, Tim
Arnold, Jacques (Gravesham)Douglas-Hamilton, Lord James
Arnold, Sir ThomasDunn, Bob
Ashby, DavidDurant, Sir Anthony
Atkinson, DavidDykes, Hugh
Baker, Nicholas (Dorset N)Evans, David (Welwyn Hatf'd)
Baldry, TonyEvennett, David
Batiste, SpencerFallon, Michael
Beith, A. J.Fearn, Ronald
Bellingham, HenryFenner, Dame Peggy
Bendall, VivianField, Barry (lsle of Wight)
Bennett, Nicholas (Pembroke)Fishburn, John Dudley
Benyon, W.Fookes, Dame Janet
Bevan, David GilroyForsyth, Michael (Stirling)
Blackburn, Dr John G.Fowler, Rt Hon Sir Norman
Boscawen, Hon RobertFox, Sir Marcus
Boswell, TimFranks, Cecil
Bottomley, PeterFreeman, Roger
Bowden, Gerald (Dulwich)French, Douglas
Bowis, JohnGale, Roger
Boyson, Rt Hon Dr Sir RhodesGardiner, Sir George
Brazier, JulianGlyn, Dr Sir Alan
Bright, GrahamGoodhart, Sir Philip
Brown, Michael (Brigg & Cl't's)Goodlad, Rt Hon Alastair
Bruce, Ian (Dorset South)Goodson-Wickes, Dr Charles
Buck, Sir AntonyGorst, John
Budgen, NicholasGreenway, Harry (Ealing N)
Burns, SimonGreenway, John (Ryedale)
Burt, AlistairGregory, Conal
Butler, ChrisGriffiths, Peter (Portsmouth N)
Butterfill, JohnGrist, Ian
Campbell, Menzies (Fife NE)Grylls, Sir Michael
Carlisle, Kenneth (Lincoln)Hague, William
Carrington, MatthewHamilton, Rt Hon Archie
Cash, WilliamHampson, Dr Keith
Channon, Rt Hon PaulHanley, Jeremy
Chapman, SydneyHannam, Sir John
Chope, ChristopherHargreaves, A.(B'ham H'll Gr')
Clark, Dr Michael (Rochford)Hargreaves, Ken (Hyndburn)
Clark, Rt Hon Sir WilliamHarris, David
Clarke, Rt Hon K.(Rushcliffe)Haselhurst, Alan
Colvin, MichaelHayes, Jerry
Coombs, Anthony (Wyre F'rest)Hayhoe, Rt Hon Sir Barney
Coombs, Simon (Swindon)Hayward, Robert
Cope, Rt Hon Sir JohnHeathcoat-Amory, David
Hicks, Mrs Maureen (Wolv'NE)Portillo, Michael
Higgins, Rt Hon Terence L.Powell, William (Corby)
Hill, JamesPrice, Sir David
Hind, KennethRaison, Rt Hon Sir Timothy
Hordern, Sir PeterRathbone, Tim
Howard, Rt Hon MichaelRedwood, John
Howarth, Alan (Strat'd-on-A)Rhodes James, Sir Robert
Howarth, G. (Cannock & B'wd)Riddick, Graham
Howell, Ralph (North Norfolk)Ridsdale, Sir Julian
Howells, GeraintRifkind, Rt Hon Malcolm
Hughes, Robert G. (Harrow W)Roberts, Rt Hon Sir Wyn
Hunt, Rt Hon DavidRoe, Mrs Marion
Hunt, Sir John (Ravensbourne)Rossi, Sir Hugh
Irvine, MichaelRowe, Andrew
Jack, MichaelRumbold, Rt Hon Mrs Angela
Jackson, RobertSackville, Hon Tom
Jessel, TobySainsbury, Rt Hon Tim
Johnson Smith, Sir GeoffreyScott, Rt Hon Nicholas
Jones, Gwilym (Cardiff N)Shaw, David (Dover)
Jones, Robert B (Herts W)Shaw, Sir Michael (Scarb')
Key, RobertSims, Roger
King, Roger (B'ham N'thfield)Skeet, Sir Trevor
King, Rt Hon Tom (Bridgwater)Smith, Tim (Beaconsfield)
Kirkhope, TimothySoames, Hon Nicholas
Knapman, RogerSpeed, Keith
Knight, Greg (Derby North)Speller, Tony
Knight, Dame Jill (Edgbaston)Spicer, Sir Jim (Dorset W)
Knowles, MichaelSquire, Robin
Knox, DavidStanbrook, Ivor
Latham, MichaelStanley, Rt Hon Sir John
Lawrence, IvanSteel, Rt Hon Sir David
Lennox-Boyd, Hon MarkStephen, Nicol
Lester, Jim (Broxtowe)Stern, Michael
Lightbown, DavidStevens, Lewis
Lilley, Rt Hon PeterStewart, Andy (Sherwood)
Livsey, RichardStewart, Rt Hon Sir Ian
Lloyd, Sir Ian (Havant)Summerson, Hugo
Lloyd, Peter (Fareham)Tapsell, Sir Peter
Lord, MichaelTaylor, Ian (Esher)
Luce, Rt Hon Sir RichardTaylor, Sir Teddy
Lyell, Rt Hon Sir NicholasThompson, Sir D.(Calder Valley)
MacGregor, Rt Hon John
MacKay, Andrew (E Berkshire)Thompson, Patrick (Norwich N)
McLoughlin, PatrickThorne, Neil
McNair-Wilson, Sir PatrickThurnham, Peter
Madel, DavidTownend, John (Bridlington)
Malins, HumfreyTownsend, Cyril D. (B'heath)
Mans, KeithTredinnick, David
Martin, David (Portsmouth S)Trotter, Neville
Maude, Hon FrancisTwinn, Dr Ian
Mawhinney, Dr BrianViggers, Peter
Maxwell-Hyslop, Sir RobinWakeham, Rt Hon John
Miller, Sir HalWaldegrave, Rt Hon William
Mills, IainWallace, James
Mitchell, Andrew (Gedling)Waller, Gary
Moate, RogerWard, John
Montgomery, Sir FergusWarren, Kenneth
Morris, M (N'hampton S)Watts, John
Morrison, Sir CharlesWells, Bowen
Moynihan, Hon ColinWheeler, Sir John
Neale, Sir GerrardWhitney, Ray
Nelson, AnthonyWiddecombe, Ann
Neubert, Sir MichaelWiggin, Jerry
Nicholls, PatrickWinterton, Mrs Ann
Nicholson, David (Taunton)Winterton, Nicholas
Norris, SteveWolfson, Mark
Onslow, Rt Hon CranleyWood, Timothy
Oppenheim, PhillipWoodcock, Dr. Mike
Page, RichardYeo, Tim
Paice, JamesYoung, Sir George (Acton)
Patnick, Irvine
Patten, Rt Hon Chris (Bath)Tellers for the Ayes:
Pawsey, JamesMr. John M. Taylor and Mr. Neil Hamilton.
Peacock, Mrs Elizabeth
Porter, David (Waveney)
NOES
Adams, Mrs Irene (Paisley, N.)Ashton, Joe
Anderson, DonaldBanks, Tony (Newham NW)
Archer, Rt Hon PeterBarnes, Harry (Derbyshire NE)
Barron, KevinMcAllion, John
Battle, JohnMcAvoy, Thomas
Beckett, MargaretMacdonald, Calum A.
Bell, StuartMcFall, John
Boyes, RolandMcKelvey, William
Bradley, KeithMcMaster, Gordon
Bray, Dr JeremyMcNamara, Kevin
Brown, Nicholas (Newcastle E)McWilliam, John
Caborn, RichardMadden, Max
Callaghan, JimMahon, Mrs Alice
Campbell-Savours, D. N.Marshall, David (Shettleston)
Canavan, DennisMartin, Michael J. (Springburn)
Clark, Dr David (S Shields)Martlew, Eric
Clarke, Tom (Monklands W)Maxton, John
Clelland, DavidMeale, Alan
Clwyd, Mrs AnnMichael, Alun
Cohen, HarryMichie, Bill (Sheffield Heeley)
Cook, Frank (Stockton N)Moonie, Dr Lewis
Cook, Robin (Livingston)Morgan, Rhodri
Corbett, RobinMorley, Elliot
Cousins, JimMowlam, Marjorie
Cox, TomMullin, Chris
Crowther, StanMurphy, Paul
Cryer, BobO'Brien, William
Cunliffe, LawrenceO'Hara, Edward
Dalyell, TamO'Neill, Martin
Darling, AlistairOrme, Rt Hon Stanley
Davies, Ron (Caerphilly)Parry, Robert
Davis, Terry (B'ham Hodge H'l)Powell, Ray (Ogmore)
Dewar, DonaldPrescott, John
Dixon, DonQuin, Ms Joyce
Dobson, FrankRedmond, Martin
Doran, FrankReid, Dr John
Dunnachie, JimmyRogers, Allan
Eastham, KenRooney, Terence
Enright, DerekRoss, Ernie (Dundee W)
Ewing, Harry (Falkirk E)Ruddock, Joan
Flynn, PaulShort, Clare
Foster, DerekSkinner, Dennis
Fraser, JohnSmith, Andrew (Oxford E)
George, BruceSmith, C. (Isl'ton & F'bury)
Godman, Dr Norman A.Smith, Rt Hon J. (Monk'ds E)
Golding, Mrs LlinSmith, J. P. (Vale of Glam)
Griffiths, Nigel (Edinburgh S)Snape, Peter
Griffiths, Win (Bridgend)Soley, Clive
Grocott, BruceSpearing, Nigel
Hardy, PeterSteinberg, Gerry
Haynes, FrankStrang, Gavin
Heal, Mrs SylviaTaylor, Mrs Ann (Dewsbury)
Henderson, DougThompson, Jack (Wansbeck)
Hinchliffe, DavidTurner, Dennis
Hoey, Kate (Vauxhall)Walley, Joan
Home Robertson, JohnWareing, Robert N.
Hood, JimmyWatson, Mike (Glasgow, C)
Howarth, George (Knowsley N)Welsh, Michael (Doncaster N)
Howells, Dr. Kim (Pontypridd)Williams, Alan W. (Carm'then)
Hoyle, DougWilson, Brian
Hughes, Robert (Aberdeen N)Winnick, David
Illsley, EricWise, Mrs Audrey
Ingram, AdamWorthington, Tony
Kilfoyle, PeterWray, Jimmy
Kumar, Dr. AshokYoung, David (Bolton SE)
Lamond, James
Lewis, TerryTellers for the Noes:
Lloyd, Tony (Stretford)Mr. Allen McKay and
Lofthouse, GeoffreyMr. Martyn Jones.
Loyden, Eddie

Question accordingly agreed to.

Resolved,That the draft Ports Act 1991 (Levy on Disposals of Land, etc.) Order 1991, which was laid before this House on 5th December, be approved.