Privatisation

asked the Chancellor of the Exchequer if he will provide information showing, for each stock

Privatisation	Date of flotation¹	Offer price per share (pence)	Number of shares² purchased for initial instalment cost of:		Total costs to Her Majesty's Government of financial and 'legal advice and other services, excluding VAT and stamp duty £ thousands
			(i) £1,000	(ii) £5,000
1. British Aerospace	20 February 1981	150	666	n/a³	4,970
2. Cable and Wireless	6 November 1981	168	595	2,976	5,778
3. Amersham International	25 February 1982	142	704	3,521	1,826
4. Britoil	23 November 1982	215 (instalments of 100 on application and 115)	1,000	5,000	10,994
5. Associated British Ports	16 February 1983	112	875	4,400

market flotation since 1979 of former publicly owned bodies (a) the date of flotation, (b) the number of shares offered for sale, (c) the offer price per share, giving, where appropriate, details of partly paid prices, (d) the number of shares allocated to applicants investing an initial instalment of (i) £1,000 and (ii) £5,000, (e) the opening stock market price per share for sales, (f) the total cost of the publicity campaign, (g) the total amount of fees paid, (h) administrative costs borne by the Exchequer, (i) an estimate of revenue forgone as a result of any special dealing arrangements, (j) in the case of British Gas and British Telecom an estimate of the total value of special customer bill reductions for shareholders, (k) an estimate of the total value of bonus share arrangements and (l) details of any Exchequer expenditure not already shown.

The information requested at (a), (c), (d) and (g) is given in the table. I refer the hon. Member to the answer given to the hon. Member for Sedgefield (Mr. Blair) on 2 March (Official Report, column 522) for the information requested at (b) and (e). For information about pre-sale publicity costs, I refer the hon. Member to my answer to the hon. Member for Newham, North-West (Mr. Banks) on 7 November (Official Report, column 628), the answer given by my right hon. Friend the Secretary of State for Energy to my hon. Friend the Member for Lewisham, West (Mr. Maples) on 12 December (Official Report, column 244) and that given by my right hon. Friend the Secretary of State for Transport to my hon. Friend the Member for Nottingham, South (Mr. Brandon-Bravo) on 18 February (Official Report, column 628).No separate records of the administrative costs to the Exchequer of each privatisation are available: these are borne within the budgets of the relevant Government Department. No revenue was forgone as a result of special dealing arrangements for privatisation shares. The current estimated total value of special customer bill reductions for shareholders is £99 million for British Gas and £19·5 million for British Telecom. Bonus share arrangements were available on four privatisations, and the value of the shares at the offer price retained to meet this commitment was £107 million for British Telecom, £144 million for British Gas and £22 million for British Airways; final figures will depend on the number of eligible shareholders at the end of the qualifying periods. The value of Britoil bonus shares distributed in 1986 was £3 million.

Privatisation	Date of flotation¹	Offer price per share (pence)	Number of shares² purchased for initial instalment cost of:		Total costs to Her Majesty's Government of financial and 'legal advice and other services, excluding VAT and stamp duty £ thousands
			(i) £1,000	(ii) £5,000
6. Enterprise Oil	2 July 1984	186 (instalments of 100 on application and 85)	1,000	n/a³	9,068
7. Jaguar	9 August 1984	165	600	3,030	⁴—
8. British Telecom	3 December 1984	130 (50 on application and two later instalments of 40)	n/a³	n/a³	⁵165,037
9. British Gas	8 December 1986	135 (50 on application and later instalments of 45 and 40)	2,000	n/a³	⁶154,000
10. British Airways	11 February 1987	125 (instalments of 65 on application and 60)	n/a³	n/a³	⁶28,500
¹ First day of dealings on Stock Exchange.
² Since applications were accepted only for certain round numbers of shares it would not have been possible to apply for exactly £1,030 or £5,000 of shares, for the purposes of this table, however, it is assumed that such applications could have been made.
³ Maximum allocation (value of first instalment) was less than £1,000 or £5,000.
⁴ The sale of Jaguar plc was conducted by BL plc who appointed advisers. Details of the appointments and the total cost are a matter for the Company. Only one firm was appointed to advise the Government; it is not the practice to disclose fees paid to individual firms.
⁵ Includes estimates for expenses up to 1988–89.
⁶ Estimated figure for 1986–87.

Volume 111: debated on Friday 6 March 1987