Discretionary Share Option Schemes in the Privatised Utilities

Part of New clause 1 – in the House of Commons at 6:30 pm on 3rd April 1995.

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Photo of Gerry Sutcliffe Gerry Sutcliffe , Bradford South 6:30 pm, 3rd April 1995

This issue is not about greed, envy or even political advantage, as the hon. Member for Wirral, South (Mr. Porter) suggested. It is about fairness and equity. Every Conservative Member who has spoken has recognised that the problem exists, but none has come up with a solution.

It will be interesting to hear the way in which the Financial Secretary to the Treasury replies to the debate. I hope that he will not push us to one side and tell us to wait for the Greenbury recommendations. I hope that he will tackle the issue because, if the regulator cannot consider the matter, the only organisation that can consider it is the Inland Revenue, via the tax system, and that is where the Minister's responsibility lies.

It is patently unfair that executives of privatised utilities make large sums when they are devoting no more effort to their work than they did when they worked for public utilities that benefited everyone. When those public utilities were privatised, the Government said that they would be privatised for the greater good and that many people would benefit. That was not the case. In that respect, we have witnessed the classic unfairness that has become a trademark of this Government.

The Government recognise the problem. They say that the money does not matter, but those people have benefited to the tune of £150 million. The hon. Member for Milton Keynes, South-West (Mr. Legg) said that 36,000 people in British Gas also have share option schemes. They do, but those share option schemes are usually "buy one, get one free" schemes, in which people have to invest their own money and take the risks. The executives have taken no risks and made no investment.

I hope that the Financial Secretary, who is very eloquent and who has been eloquent in Committee, will give the answer for the Government. It is no good the Prime Minister recognising that there is a problem but not suggesting a solution. Lei us have it. Will the Government tell us what they will do about those abuses, or shall we hear nothing from the Government, as we forecast? That is patently unfair. It is not a party political issue. People throughout the spectrum are upset about those abuses, and it is about time that the Government did something about them.