I beg to move, That this House doth agree with the Lords in the said amendment.

With this, it will be convenient to take Lords amendments Nos. 21, 22, 29 and 34.

These amendments are largely technical. They arise from the existing provision in schedule 1 for transfer schemes to provide for

"repealing or amending any statutory provision of local application".

I am extremely grateful to the Minister for showing his characteristic courtesy to me. Has he or his officials received any intimation whatsoever from the Clyde port authority concerning its private Bill which would privatise that authority? Has it decided to pull up stumps and go home?

As my right hon. and learned Friend the Secretary of State made perfectly clear on Second Reading, that is a matter for the Clyde port authority. Obviously, I hope that it will have the benefit of the Bill being on the statute book in a short time. It will be for it to decide which course to follow. It is likely to follow the course of the Bill that we are discussing.

The intervention by my hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) demonstrates the great concern about there being a public Bill and a private Bill. It was only as the private Bill went through the House that it was realised that the Treasury had to become involved to start getting money out of local trusts. The amendment went through the other place virtually without discussion, which means that we cannot oppose it at this stage. However, I wish to record once again our concern that this legislation is not doing its best for local communities. In effect, the interests of the port are being divorced from those of the local community. As we have just heard, until now, ports have tended to act in the interests of their local community.

I beg to move, That this House doth agree with the Lords in the said amendment.

I must inform the House that the amendment involves privilege.

The aim of this group of amendments is to ensure that the Bill's provisions regarding the issue of securities by the successor company are compatible with a technical provision of an EC directive on company law, while at the same time maintaining the tax treatment of those securities.

Again, we have further proof that this legislation is not about improving transport or about establishing an integrated transport structure. Amendment No. 2 shows the need for the face of the Bill to be changed because of the Bill's fundamental incompatibility with company law and with an EC directive on company law. The provisions were not voted on in the other place and, at this stage, we do not wish to oppose the amendment.

I beg to move, That this House doth agree with the Lords in the said amendment.

With this, it will be convenient to take Lords amendments Nos. 23 and 30.

The amendments aim to rectify a possible shortcoming in the Bill's provisions enabling support to be given to a management and employee team engaged in bidding for a port.

"managers and other persons employed"—

Opposition Members believe that these amendments go to the heart of the Bill as it stands, because they deal with the subject of management buy-outs. We are grateful for the fact that, when the amendments were discussed in the other place, as a result of probing by the Opposition, we were given the Secretary of State's guidance notes relating to the procedure for the sale of trust ports. The notes form a most helpful document.

"that the trust port will be required to appoint appropriate advisers to provide it with an independent benchmark valuation of the undertaking and an independent assessment of the bids received.

This assessment should include advice as to whether the bids properly reflect the value of the port undertaking … that the trust port will need to make this benchmark valuation and assssement available to the Secretary of State in putting forward its own proposals regarding the sale of the port to the Secretary of State for his agreement.

That these proposals will need to take into account the extent to which the bids meet the objectives of sale and will not therefore necessarily recommend that the highest bid should be accepted."

"a trust port may wish to recommend that a price preference should be applied to a bid from a management and employee buy out team.

The Secretary of State will be prepared to consider a limited preference of this kind in individual cases and will have regard to the particular circumstances of each case."

Is my hon. Friend satisfied that, following a buy-out or the privatisation of a trust port, the new authority would not be able to evade the responsibilities that the Port authority currently carries out? The important dredging operation on the upper reaches of the Clyde is now carried out by the Clyde port authority. That essential task must be carried out, or the river will silt up.

I am grateful to my hon. Friend for his intervention, but I am not the Minister of the Crown who can or should answer that question. My understanding of the Bill is that the dredging would fall within the statutory authority of the port and would be a statutory requirement for whoever takes over the port. A port would be disadvantaged, because investment in it might suffer if the proposed buy-out came from a firm that decided to invest elsewhere. I am grateful to my hon. Friend for drawing that point to my attention and to that of the House.

My hon. Friend cannot be completely familiar with the upper reaches of the Clyde. I wish to put it on the record that the Clyde port authority has a power which allows it to dredge the Clyde but that it has no duty to do so. That will be the case in the future. We are fearful that an entirely commercially oriented body would be interested only in property development and not in the welfare of the river. I am grateful to my hon. Friend for letting me put that point.

I am grateful to my hon. Friend for making that point. Undoubtedly, the Minister will respond to it. It is on the record, and it is an important point. It is one of the reasons why the Opposition consistently opposed the privatisation of the ports, as embodied in the Bill.

I apologise to my hon. Friend the Minister for stepping in at this stage. If it is in any consolation, I assure him that I do not intend to speak many times. I appreciate that the Bill has been carefully considered by the Committee, but I wish to make one minor point.

I wish to take up the point raised by my hon. Friend the Member for Middlesbrough (Mr. Bell), which was given great emphasis in Committee, about our worries about those who take responsibility for our ports. As I have said on previous occasions, the ports will remain an important part of Britain's economy and transport structure, but in view of what has already happened in the ports and of the Lords amendments, it appears that the Government have neglected to deal with the future of the port transport industry in Britain. Our anxiety remains.

After the bizarre intervention by my hon. Friend the Member for Southend, East (Sir T. Taylor), I am not sure what we are supposed to be debating. I thought that we were debating the amendments to which the hon. Member for Middlesbrough (Mr. Bell) addressed himself. I should like to get back to those amendments by assuring you, Mr. Deputy Speaker, the hon. Gentleman and the House that you need not worry about the Tees and Hartlepool port authority. It is in good hands—apart from anyone else's, mine. That means that the hon. Gentleman need not worry whether the port will be slow off the mark in seeking privatisation by the management team.

I would not dream of engaging in the debate on the state of socialism in the north-east of England, because you, Mr. Speaker, would rule me out of order. As a Member of Parliament in another country from that of the hon. Member for Langbaurgh (Mr. Holt), I can tell him that it is the Conservative party that is slipping away in Scotland, but I shall not go further down that road, either.

The debate about employee-management buy-outs was developed extensively in Committee. We were disappointed that there was nothing in the Bill at the outset about how they could be achieved. The amendments and their further clarification is some proof that we made some progress on the idea.

Can my hon. Friend refute the argument of the hon. Member for Langbaurgh (Mr. Holt) who, with his usual grace, entirely misunderstood my remarks? If the Tees and Hartlepool authority were to be the first in line for privatisation, as it does not have the clear-cut assurance from the Government that a management buy-out will be preferred to a competitive tendering bid, there is every likelihood that it will lose its management buy-out and end up in the hands of a foreign firm with no particular interest in Teesside. Is not that the point of not hurrying towards privatisation under amendments, but of waiting for two years to pass so that we can see exactly what foreign interest there is in our ports?

I am grateful to my hon. Friend for raising the issue, in relation to Tees and Hartlepool in particular. Two private Bills proceeded through Parliament—one for the Clyde port authority and the other for the Tees and Hartlepool port authority—and it is clear to everybody that the proof of the pudding will be in how the Bill relates to and compares with the private business that came to such an abrupt end when it was previously considered in this House.

The hon. Member for Langbaurgh (Mr. Holt) said, in relation to the amendments, that there could be management buy-outs at Tees and Hartlepool. Is it not a fact that, had it not been for our opposition in Committee, helped by some Conservative Members—we are always glad to see the hon. Member for Thurrock (Mr. Janman) in his place and look forward to his presence when we discuss the clawback—even the limited preference buy-out scheme that we now have would not exist? That is entirely due to our opposition in Committee in which we were aided by a few Conservative Members. The great golden dream of the hon. Member for Langbaurgh of a management buy-out on Teesside, for which he and his colleagues wish to take credit, would not have come about but for the opposition of Labour Members.

I am always glad to give credit where credit is due. My hon. Friend the Member for Middlesbrough (Mr. Bell) is right to speak of the way in which the Opposition pressed for a policy that was not even included on the face of the Bill—albeit with some assistance from Conservative Members, who realised that ports could well be bought out by foreign interests and closed down because those foreign interests might have no regard for port activities. We take the credit for obtaining a firmer commitment to employee-management buy-outs. However, that commitment does not go far enough; we would like the Bill to have given complete priority to the concept of employee-management buy-outs, but that is not contained in the legislation.

I was not a member of the Committee. I note my hon. Friend's misgivings about the amendments emanating from the other place. If the amendments are accepted, it would enable employees of the Clyde Port Authority to take a much more active part in the acquisition of the CPA than would have been the case under the terms of the Clyde Port Authority Bill, which came to grief in the other place. That is an important distinction, and it is why I gave the example of the Dundee bus company, where the employees and their representatives were part of the negotiating team discussing financial considerations. If the amendments are passed, CPA employees would at least have a more active involvement in their future than would have been the case under the terms of the dreadful CPA Bill.

I am grateful to my hon. Friend and I am sure that his constituents in the Clyde district are aware of the point that he makes. We are concerned to make absolutely certain that employees who have given their life's work to the ports are as involved as possible in the port's future. We have to do so bearing in mind the fact that the employees have to contend with legislation that forces the ports to become privatised.

I am grateful to my hon. Friend for giving way. I had not intended to take part in the debate, principally because I am not feeling very well.

My hon. Friend makes a valid point. I can well foresee circumstances in which local employees may wish, at all costs, to proceed with an employee-management buy-out to avoid the horrendous implications of a foreign company buying out the trust port. If that could not be made possible because the provisions did not exist in the Bill, those employees would wish to use every option open to them to ensure the employee-management buy-out. We would insist on exploring our need to operate in harmony with European directives to ensure that employees do not lose the option of an employee-management buy-out.

I hesitate to intervene in the speech of my hon. Friend, but no doubt she has read—as I have—the debate on the amendments in the other place and will have noted the great anxiety felt there, as it was in Committee, about the possible privatisation of the port of Poole. We are glad to see the hon. Member for Poole (Mr. Ward) in his place tonight. In Committee, he expressed concern that the port of Poole might be privatised.

I shall be guided by you, Mr. Deputy Speaker, as to whether it would be in order for me to respond to the comments by my hon. Friend the Member for Middlesbrough, which may have been slightly outside our remit.

I am grateful to the hon. Lady. I am getting worried that the discussion is almost turning into a Second Reading debate. I hope that most of the arguments will be used on this group of amendments and that after that we may proceed more rapidly.

I am grateful for your advice on that, Mr. Deputy Speaker. I would also understand if the hon. Member for Poole (Mr. Ward) wanted to intervene now, rather than later, but I have no doubt that he will make a contribution if he wants to.

The guidelines appeared in draft form in the other place. On insisting that they be placed in the Library, my hon. Friends and I discovered that they were sent to the managing director of the British Ports Federation, Mr. J. Sharpies, by a Mr. M. W. Jackson—apparently he is a civil Servant. It was only because of the unofficial title of those notes—"The Secretary of State's guidance notes on the procedure for sale of trust ports"—that we ascertained that they were the guidelines for which we were looking. Does my hon. Friend agree that it is remarkable that we have to suss out those guidelines from the Library as a consequence of a debate in the other place? Does my hon. Friend agree that it is remarkable that those guidance notes were not sent by the Minister to members of the Committee for the use in the House today?

I am grateful to my hon. Friend for drawing the details of the issue to the attention of the House.

Does my hon. Friend agree that, in essence, it is clear from the guidelines that there is no firm Government commitment to the management buy-out option? We are committed to that option. Does my hon. Friend agree that, unless we have a firm assurance from the Minister that the Government will show a preference for such buy-outs, we may yet divide the House on this amendment?

My hon. Friend has said it far better than I could. This issue is of great concern to us.

This has been an interesting debate. I wonder what the Opposition's attitude would have been if the Government had given an absolute commitment to management-employee buy-outs which therefore substantially reduced the price of the ports? Let us then suppose that, at a later stage, the ports were sold. I am sure that the Opposition would have been the first to complain that we had not attracted sufficient revenue to the Exchequer. They would have been the first to complain about the taxpayer being ripped off.

Does my hon. Friend agree that it is hypocritical and richly ironic for the Labour party to argue so hard for management-employee buy-outs? If we had a Labour Government today, we would not have this Bill, and not one set of managers or employees would have the right to buy anything in our ports.

My hon. Friend makes the very point that I was about to make.

"a statement of objectives … need to be agreed on a port-by-port basis with the Secretary of State. In framing their draft objectives ports should have regard to the desirability of encouraging the disposal of the whole or a substantial part of the successor company's equity share capital to managers or other employees of the port. A limited price preference for a management and employee buy-out may be appropriate, as described in paragraph 15 below."

"In particular a trust port may wish to recommend that a price preference should be applied to a bid from a management-employee buy-out team. The Secretary of State will be prepared to consider a limited price preference of this kind in individual cases and will have regard to the particular circumstances of each case."

I am sorry to take up more of the Minister's time, but we said earlier that, if we were not satisfied with his explanation, we would divide the House. If he gave me an assurance that, although the guidelines talk of "limited preference" being appropriate, he will knock out "limited" and simply leave it as a "preference", we might be able to avoid a Division.

We are not discussing the guidelines. The wording enables the Government to have discretion between port and port. I should have thought that that would be welcome. I would not want to declare in advance what the position would be for each and every port, because decisions will be made in due course. It would not be practicable to say that, come what may, management-employee buy-outs will be successful. I hope that, in the vast majority of cases, such buy-outs are successful.

I am sorry to interrupt my hon. Friend, but this is terribly important. Has he the approval of the EEC Commission for his important statement that preference will be given to a management buy-out, even at a lower cost? My understanding is that what he said is contrary to European Community law and that he will get hammered by the European Commission if he tries to insist on it.

One always takes seriously my hon. Friend's cautions about our position within the Community and about what the Community law says. This is in line with what we did when we privatised the Scottish Bus Company. The same words were used in that case, so I am content that we are not breaking any treaty obligations in the way my hon. Friend fears.

I hope that what the Minister has said is borne out by the events. He was the Minister who had to change the Merchant Shipping Act 1988. That change was inflicted on the Government by the president of the European Court of Justice. Is he completely confident that a similar change will not be imposed on him as a result of these amendments?

That is going rather wide of the amendments. I remember the incident because it was my first appearance at the Dispatch Box. However, I have no doubt that what the Bill sets out is acceptable to the Commission.

On competition, the situation under these amendments would not be dissimilar to the television franchises. As the Minister has been so frank and forthright on this issue, and given the assurances that he has made about management buy-outs, it does not appear necessary for us to divide the House.

I am grateful to the hon. Gentleman. If anybody wishes to give me any similar assurances when we debate other amendments, I shall be only too pleased to give way. I can hear my Whip telling me not to be too generous. I commend the amendments to the House.

I beg to move, That this House doth agree with the Lords in the said amendment.

With this it will be convenient to take Lords amendments Nos. 5 and 6.

These amendments should be called the Ward amendments because they are the result of the well-constructed case made by my hon. Friend the Member for Poole (Mr. Ward). They mean that, once the Government have looked at a port after the two-year period and have decided not to privatise at that stage, they will not look at that port again for another five years. My hon. Friend argued his case well on Report and I gave him the commitment that we would make this amendment in the other place, and we have done so.

It would be churlish not to thank my hon. Friend the Minister for the amendments. He knows that we do not wish the port of Poole to be privatised. The five-year moratorium gives it the opportunity to carry on its business in a sensible businesslike way which will prove, in five or seven years' time, that there is still no need to privatise. My hon. Friend the Minister listened with courtesy to the representations made to him rather noisily in my constituency, and I thank him for that. We obviously did not entirely convince him, but half a cake is better than none and I am grateful to my hon. Friend for what we have.

We are glad of some further clarifications on the Secretary of State's powers of compulsion. We are totally against any compulsion. If there is to be privatisation, it must be done voluntarily and on the merits of the argument. We are concerned about the position of Poole trust port, but other ports are in a similar position and do not want these powers compulsorily attached to them. We are therefore glad of that clarification.

I beg to move, That this House doth agree with the Lords in the said amendment.

The amendment involves privilege.

Amendments Nos. 7, 8 and 16, and the amendment to the Bill's title are all in one way or another paving or consequential amendments of amendment No. 10, which is designed to close a serious potential loophole in the arrangements for a clawback levy contained in clauses 17 and 18 of the Bill. In its present form, that levy applies only to land which is transferred directly from a port authority to its successor company. But some of the larger trust ports own subsidiary companies and, even if they do not, may well have the power to establish them. These companies perform a variety of functions, including, in some cases, the owning of land. It is therefore clearly necessary that the Bill should provide for the levy on onward land disposals to apply not just to land owned by the successor company itself but to land owned by the port authority's subsidiaries, which after the transfer will become subsidiaries of the successor company.

Suffice it to say that this is just one more example of how in reality we are dealing with a finance Bill rather than a transport Bill. The fact that the Treasury did not understand the difference between the successor companies and the subsidiary companies at the outset of the proceedings of the Bill means that at this late stage this has had to be done to achieve consistency. Nevertheless, we agree that the amendments tighten up the loopholes.

I beg to move, That this House doth agree with the Lords in the said amendment.

The amendment involves privilege.

The principal amendment in this group of five amendments is amendment No. 12, which is intended to close a technical but not insignificant gap in the provisions of the Bill relating to the clawbreak levy. The amendment refers to the meaning of the word "disposal" in the context of clause 17, and it is made necessary because of a discrepancy between the time factor in clause 17 of the Bill—specifically, the levy period of 10 years—and a time factor which is sometimes relevant for determining whether there has been a disposal for the purposes of the Capital Gains Tax Act 1979. This latter time factor may be referred to as the six-year time limit.

I beg to move, That this House doth agree with the Lords in the said amendment.

The amendment involves privilege.

This amendment makes it possible for penalties to be imposed where the provisions concerning the clawback levy on subsequent disposals of land are not complied with. I am sure that it will be welcomed by the House.

I place on record the fact that this will be subject to affirmative orders in both Houses. We pressed for that in Committee and we very much welcome the amendment.

I beg to move, That this House doth agree with the Lords in the said amendment.

With this, it will be convenient to consider Lords amendments Nos. 20, 24 and 25.

These amendments are intended to clarify the drafting of one aspect of the provision that the Bill makes enabling port authorities to repay the costs incurred by their management and employees in attempting to buy out the authority's successor company.

I do not wish to detain the House any longer on this issue. However, it is important for me to point out that the Opposition would have preferred the option of some involvement of independent advisers. Nevertheless, the amendments represent a tightening up of the measure. We therefore do not intend to oppose the amendments.

I beg to move, That this House doth agree with the Lords in the said amendment.

Earlier, the Minister was kind enough, to say that I ought to have raised the issue that I raised then on Lords amendment No. 35. He was very helpful in providing information, but I want to ask him whether I was correct in my assessment. He said that police employed by the Port of London authority would have certain safeguards. They are possibly to be transferred to another employer, for whom they will be doing the same job in the same circumstances. There will be no change. The Minister said that the previous assurance that they received—that they would receive Metropolitan police rates of pay—may no longer apply; instead they will receive Essex rates of pay.

I shall certainly give careful consideration to what my hon. Friend the Member for Southend, East (Sir T. Taylor) has said.