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Volume 87: debated on Wednesday 27 November 1985

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asked the Secretary of State for Trade and Industry what privatisation proposals are currently being considered by his Department.

My right hon. and learned Friend plans to return to the private sector as many as possible of the publicly owned enterprises for which he is responsible. They include the remaining warship building yards of British Shipbuilders, Rolls-Royce, British Steel Corporation, and BL.

Will the Minister confirm newspaper reports that the Government intend that a substantial part of the next tranche of Cable and Wireless shares will go to institutional investors? How does that square with the desire to see wider share ownership among the general public?

It would not be right for me to confirm newspaper reports at this stage. In due course the House will be informed of the arrangements for that disposal.

Is my hon. Friend aware of the concern in my constituency about the future of English Estates, its funding, and its ability to redevelop Chatham dockyard? Will he decide whether to accept the management buy-out proposals as quickly as possible?

I am grateful to my hon. Friend for raising that matter. My right hon. and learned Friend the Secretary of State will be addressing himself to it later.

Is the Minister aware that there is no commercial or industrial justification for the proposed privatisation of Rolls-Royce—[HON. MEMBERS: "Why not?"]—because the company's viability is entirely dependent on Government contracts, Government aid for civil projects and the Government's purchasing power in relation to military projects? Given that total dependence, there should be public accountability, which can be achieved only while Rolls-Royce is in the public sector. Will the Minister therefore drop that item from his disgraceful shopping list?

No, I will not. Perhaps the hon. Gentleman will consider an analogy with British Aerospace, to which the same comments apply. Since 1980, when British Aerospace was once again privatised, its turnover has increased by 73 per cent. and its pre-tax profits have increased by 128 per cent. That is the reason for privatisation.