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 Andrew Smith Andrew Smith Shadow Chief Secretary to the Treasury, Shadow Spokesperson (Treasury) 6:30 pm, 3rd April 1995

I should like to acknowledge the powerful arguments made by my hon. Friends the Members for Monklands, East (Mrs. Liddell), for Stoke-on-Trent, South (Mr. Stevenson), for Barking (Ms Hodge), for Sheffield, Attercliffe (Mr. Betts), for Dudley, West (Mr. Pearson) and for Bradford, South (Mr. Sutcliffe). I warmly welcome back to the Chamber our hon. Friend the Member for Walsall, North (Mr. Winnick). It was good to see him making a characteristically robust contribution to the debate.

Replying to the debate, the Financial Secretary spent more time attempting to defend privatisation than defending the—admittedly indefensible—abuses of executive share options. In that respect he differed from the hon. Members for Wirral, South (Mr. Porter) and for Beaconsfield (Mr. Smith), who at least acknowledged that there was a problem and that something needed to be done. They must have been as disappointed as we were not to hear any promise of Government action.

The Minister did not deal with the case that my hon. Friends have made. Action is needed on the ground of fairness, and because of our responsibility for taxpayers' money. It is especially needed in the case of the privatised utilities because of their ability to exploit their monopolies and because of the fact that their share options are a one-way bet.

Having said that the Government were not subcontracting their policy on this matter to the Greenbury committee, the Financial Secretary proceeded to do just that: he said that action would follow Greenbury. That is not good enough. I commend our new clause to the House. Let us show the public that we want to act against these outrageous abuses of share options.