Privatisation

Oral Answers to Questions — Trade and Industry – in the House of Commons at 2:30 pm on 5th April 1995.

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Photo of Mr Barry Field Mr Barry Field , Isle of Wight 2:30 pm, 5th April 1995

To ask the President of the Board of Trade what countries have sought his Department's advice on the privatisation of nationalised industries. [16435]

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

My Department has had discussions on the privatisation of nationalised industries with a wide range of countries in Europe, Latin America, Africa, Asia the middle east and the far east.

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

I thank my right hon. Friend for that answer. When he gives advice to those countries, does he point out that the privatised nationalised industries have increased productivity and share ownership on the shop floor as well as throughout our nation and have made a substantial contribution to the Exchequer with millions of pounds of corporation tax as well as to the balance of payments with the export of technology and expertise? With the abolition of clause IV, are not the Opposition yet again following where we have led for many years?

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

My hon. Friend is absolutely right. The world is interested in the programme that Britain has pioneered in privatising the nationalised industries. The nationalised industries were costing the taxpayer £50 million per week. They are now contributing £50 million a week in positive cash flow to the Exchequer from taxes on their profits. That is a remarkable achievement. It is therefore no surprise that so many countries around the world are looking at those examples and copying exactly what we have done.

Photo of Dennis Skinner Dennis Skinner Member, Labour Party National Executive Committee

Will the right hon. Gentleman tell the people from abroad who are making inquiries about the privatised industries in Britain that when he privatised British Coal he sacked 31,000 miners, closed 31 pits and then sold off the English part of the industry to Mr. R. J. Budge, whose financial base is very shaky? Mr. Budge put in a bid of £900 million; then somehow or other the right hon. Gentleman's Department reduced the tender by £100 million. If that was not a fiddle, I do not know what is.

Will the right hon. Gentleman tell those people from abroad that in respect of all the other industries that have been privatised, the only beneficiaries have been the water board chiefs and the other utility chairmen who have made a small fortune while thousands of people have been chucked on the scrap heap?

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

You might wonder, Madam Speaker, whether repealing clause IV has made any difference.

Photo of Mr Den Dover Mr Den Dover , Chorley

Does my right hon. Friend agree that for many countries throughout the world the important thing is cash flow? Does not the sale of nationalised industries, together with the fact that there will be no further outgoings of taxpayers' money—plus the income referred to by my hon. Friend the Member for Isle of Wight (Mr. Field)—show that the cash flow of those countries will greatly benefit from the sale of nationalised bodies to the private sector?

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

My hon. Friend is absolutely right. That is why so many Governments are looking to the process of privatisation to strengthen their economic base. The fact is that industries and companies which 15 years ago were soggy, producer-dominated, trade-union-dominated monopolies are now world-class companies winning for Britain in the four corners of the world.

Dr. John Cunningham:

Has the right hon. Gentleman warned those inquirers about how many billions of pounds consumers of water and electricity have been charged as a result of privatisation? Has he warned them, for example, that if North West Water shared its profits 50–50 between consumers and shareholders, it could reduce every consumer's bill by £50 a year? Has he warned them about the rip-offs on share options and salary increases to which my hon. Friend the Member for Bolsover (Mr. Skinner) rightly drew attention?

Has the right hon. Gentleman, as a golden shareholder in the National Grid Company, given any warning to National Grid about its tax avoidance schemes in Dublin and the Channel islands which are ripping off the taxpayer? Consumers and taxpayers are being ripped off by privatisation. How much has the taxpayer lost as a result of offshore tax dodges by National Grid, and does the right hon. Gentleman defend that?

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

The right hon. Gentleman has shown us exactly the sort of support that British privatised companies would get from a Labour Government. While my ministerial colleagues and I spend our time travelling the world helping to sell British expertise and products produced by the British privatised industries, all that the Opposition can do is find nit-picking complaints in the hope of discrediting one of the most successful changes in industrial ownership in this country's history.