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British Leyland

Volume 974: debated on Thursday 29 November 1979

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asked the Secretary of State for Industry if it is the policy of Her Majesty's Government that if a certain level of pay award is made, the Government will not recommend to Parliament that more funds are made available to British Leyland; and, if so, what the level of that pay award is.

asked the Secretary of State for Industry (1) whether Her Majesty's Government will act as guarantor for commercial debts incurred by the British Leyland Corporation;(2) whether Her Majesty's Government still stand as guarantor of British Leyland unsecured and other loan stocks.

The Government have given no legal guarantee to any of BL Limited's creditors. However, I refer the hon. Member to the statement to the House made by my right hon. Friend's predecessor, the right hon. Member for Chesterfield (Mr. Varley) on 26 May 1977, when he was asked to explain the operation of paragraph 10 of the schedule to the National Enterprise Board (Guidelines) Direction 1976 in respect of British Leyland.My right hon. Friend's predecessor said that, in the light of the first sentence of that paragraph, the NEB, with his approval, had informed British Leyland with regard to this provision that in its judgment a company in the private sector, whose relationship with British Leyland was the same as that of the NEB, by virtue both of the size of its shareholding and the closeness of its involvement in the affairs of British Leyland, could not allow British Leyland to be left in a position where it would be unable to meet its obligations.This remains valid.