§ 5.12 p.m.
§ Debate resumed.
§ Lord Jenkin of Roding
My Lords, we return to the Motion which my noble friend the Leader of the House moved some time ago. I am conscious that there is another debate to follow and I shall therefore not detain the House for long.
I listened with interest to the speeches of the noble Lords, Lord Richard and Lord Jenkins of Hillhead. I hope the latter will return to the debate as I have one or two points to address in relation to his speech. I believe that the Offices Committee was absolutely right to insist on stringent safeguards for the protection of parliamentary business by whoever will be responsible for handling it when the Stationery Office is privatised. It was said in paragraph 5, and the committee agreed, that extensive safeguards will be necessary to protect the interests of the House. The first safeguard is:Confidence that the business of the House will not be interrupted".My memory goes back several years, to the time when I was Financial Secretary to the Treasury. In that office I was responsible for the Stationery Office. I have a clear recollection of having to come down to the House of Commons on a number of occasions to apologise profusely that the papers necessary for the conduct of the business of the House were not available, or were available in such small quantities and had been produced by methods other than normal printing because of industrial disruption by HMSO. In the historical glow about that venerable institution to which we were treated by the noble Lord, Lord Jenkins, there is sometimes a tendency to forget that life in the past has not always been quite so rosy as depicted in the sales prospectus. That is what the information pack is—a sales prospectus.
Even more recently, as Secretary of State for Health and Social Services, it fell to me to receive the Merrison report which was published very shortly after the 1979 election. The Stationery Office was on strike and I had to make a Statement to the House. We were about to publish the report and there was widespread interest both inside and outside the House as to what the Royal Commission would recommend. Therefore I had to indicate the Government's view. It would have been wholly inconceivable that a Secretary of State should have had to stand at the Dispatch Box in the House of Commons and make a Statement about a major government publication and confess that no copies of the report were available for Members in either House. Perhaps that little piece of history has never been written.
735 I saw the Civil Service in the department at its best on that occasion. Staff recognised early in the morning that we would not be able to obtain the copies which we had been promised through the normal channels. I did not inquire too deeply as to the methods used by my Private Office and some of the people who worked with it. All I know is that during the course of the morning they secured from the warehouses in Cornwall House—the other side of London Bridge—sufficient copies of the report to meet, they thought, the immediate needs of both Houses of Parliament.
There were pickets on the Carriage Gates ready to stop any van delivering papers to the House of Commons on behalf of the Stationery Office. So the device was chosen that we loaded all the copies into the boots of five ministerial cars which drove peacefully through the pickets and emerged into Speaker's Court. Happily, copies of the Royal Commission report were unloaded from the boots of the cars and transported upstairs by House of Commons staff and staff in this House so that by 3.30 p.m. when I rose to make my Statement no whisper needed to be made of the situation. There were sufficient copies in the Vote Office and the Printed Paper Office here for Members' needs. That was small thanks, I have to say, to the staff of the Stationery Office at that time.
Of course, things are much better today as a result of legislation passed over the last 15 years restoring a better balance between employers and trade unions in the conduct of industrial relations. The Stationery Office has progressively been exposed to some of the chill winds of competition, than which there is nothing better for injecting a sense of responsibility towards customers.
As we read in the information pack, the Stationery Office was first a trading fund. It then became open to government departments and other public sector customers of the Stationery Office to place their business elsewhere. They did that, in increasing numbers. As a result, now that the Stationery Office is an executive agency, the words quoted by the noble Lord, Lord Richard, could have been a vindication of the policy of putting large parts of the public sector into executive agencies. It has certainly had a benign effect on the efficiency of the Stationery Office.
One point to which neither noble Lord opposite addressed himself is that the Stationery Office is left in the position of having to compete for public sector custom against the entire rest of the industry—since, now, the public sector can place its orders wherever it chooses—while at the same time it is precluded from going out to the private sector to attract business. And why is that? Because it is a public sector organisation, subject to inevitable Treasury constraints, and also subject to the rules on public sector borrowing. It is therefore in a position of potentially competing unfairly with the private sector.
The noble Lord, Lord Richard, attempted to deal with that argument by asking: what about the Post Office? Virtually the entire custom of the Post Office is already private sector custom. There is no argument. The Post Office is there as an organisation to serve business, 736 individuals and a range of customers up and down the land. It still has the statutory monopoly over the letter post—the amount that is paid for delivery of a letter. It still has that monopoly and no competitors can come in on it. That gives the Post Office its favoured position. For the rest, it competes with business generally. That is not open to the Stationery Office.
I, too, read the debates in another place very carefully, as did the noble Lord, Lord Jenkins of Hillhead. Shadow spokesmen were challenged: if they were going to change the rules and allow the Stationery Office, notwithstanding that it was a public sector executive agency, to go out into the market and compete for private sector customers with the rest of the industry, was the Shadow Chancellor prepared to change the rules in order to allow it to do that? Mr. Brown made it very clear in his efforts to convince investors from Tokyo to Singapore and wherever, and in this country, that the rules were to be applied every bit as strictly as they have been. That has been said many times. Yet in relation to a particular case Opposition spokesmen cheerfully say that the rules can be broken to allow the Stationery Office to compete as much as it likes; it could still have access to privileged borrowing. Would that still be part of the public sector debt?
The trouble is, there is an enormous hole in the arguments of the two noble Lords opposite. They want to see the Stationery Office flourish; I accept completely their good faith in that matter—and indeed, reading from the sales puff in the information pack, the noble Lord, Lord Richard, pointed out that there would be a useful and successful organisation that would be offered for sale to the private sector. But if we want a successful Stationery Office, it must have the ability to compete for the other suppliers' customers, just as those other suppliers are now free to compete for the customers of the Stationery Office. We have faced this dilemma in the case of quite a number of industries. The answer was the same in every case. It needs to have the freedom to compete that is given to the private sector.
Furthermore, we have seen huge increases in efficiency following the privatisations. The disciplines of the market, of the financial world, are more effective in keeping an organisation up to scratch than is the ability to question a Minister at the Dispatch Box, or even having a Minister in front of a Select Committee upstairs. Those are the sanctions on a public sector organisation. If you know that you will go out of business if you fail, that is likely to be a very much better bet for the success of the business. The real argument here is that the Stationery Office is currently neither one thing nor another. Its customers can go elsewhere. It cannot. Therefore, the case for privatisation is overwhelming.
Perhaps I might just for a second have the attention of the noble Lord, Lord Jenkins of Hillhead, to respond to a point in his speech. I enjoyed it very much indeed, but we were led to believe that the privatisation of the Stationery Office spelt the end of the slate itself. It was seen as part of a huge process of dismantling the entire state edifice. The noble Lord took a number of selected texts from my noble friend Lady Thatcher and others to try to justify his statement. For all the noble Lord's 737 rigorous intellectual discipline, the heart of his argument was: you are trying to free the Stationery Office from the shackles of the Treasury while at the same time pinning down the purchaser with all sorts of restrictions and agreements. The noble Lord described them as totally contradictory objectives.
There is nothing contradictory about them at all. When it comes to supplying this House and another place, whether it is a matter of the provision of Hansard or the printing of papers or Acts of Parliament, the contract that will need to be made by the supplier has to be, as the Offices Committee recommends, very tight, very tough and very specific, with completely watertight conditions. We do not know that yet. There will be an opportunity.
That having been done--and there may be other public sector purchasers who will want similar tough contracts—I want the Stationery Office to be free to compete in the rest of the market as freely as it can, whatever it wishes to be called. There are any number of examples of public sector bodies that were privatised over recent years and achieved just that: first-class service to their continuing public sector customers, while at the same time being free to compete with their private sector competitors. I understand the objections, and it is interesting that it is both present and past members of the Labour Party who take this objection. They want to see the Stationery Office being competed against, but not free to compete with the rest of the market. That is the logic of what they say. To my mind, that is nonsense.
§ 5.27 p.m.
§ Lord McNally
My Lords, as your Lordships will see from the Order Paper, this is a maiden speech. It gives me great personal pleasure to make my maiden in a debate opened by the noble Viscount, Lord Cranborne. I am afraid the McNallys have not troubled Garter King of Arms as often as the Cecils over the centuries, but our paths did cross in that we were part of that highly talented 1979 intake to the other place after the general election. The noble Viscount then left the other place voluntarily, and I left by public demand! Nevertheless, it is a pleasure to be back under the same roof.
The noble Lord, Lord Weatherill, tells the tale of, when he started his distinguished parliamentary career, overhearing two of his new colleagues saying, "Don't know what the place is coming to; they've let my tailor in now". I was worried over the past week that I might hear, "Don't know what the place is coming to; they've let my spin doctor in now". The truth is that over the past 30 years my career in Whitehall and Westminster has been spent trying to help a large number of noble Lords on both sides of the House get the right message to the right person at the right time. In case any of them are getting worried, I do not intend to start naming names this evening, except one. For seven years I had the honour and pleasure of working with the noble Lord, Lord Callaghan. Those were periods of great personal pride for me. The only thing that gives me any sense of embarrassment these days is that, with the impetuosity 738 of youth, I used to go round describing myself as "Lord Callaghan's political adviser". That is like describing yourself as "riding adviser to Willie Carson".
The only other comment I make on my past life is that, as someone who has worked and still works in public relations, I know that the relationship between my industry and this House is of continuing concern to your Lordships. From a personal point of view, I intend to set standards of probity for others to follow. But in considering that relationship and lobbying, I hope that the House, in a search for political correctness, does not cut itself off from ideas, information and opinion. Along that road the only winner is an already over-powerful and over-secretive Executive.
Today we are discussing one of those curious proposals which are often the death rattle of a dying administration. In his speech, the noble Lord, Lord Jenkin, could not understand the misgivings on this side of the House. I think they could be summarised in the phrase, "a sense of dignity". The proposal seems to be one of a collection of measures in which the Government have lost all sense of dignity in what they are trying to do. The noble Lord dismissed the information pack which was put out for the benefit of Members in preparation for this debate. I know that Ministers have not used it but this side of the House has done so. That information pack suddenly became, in the words of the noble Lord, Lord Jenkin, a sales prospectus and indeed a sales puff. I found the information extremely helpful, as I noticed did the noble Lord, Lord Richard. It tells us that HMSO is,a modern business with a highly skilled and experienced workforce, strategically well placed to benefit from a changing market place".It is clear that we are not dealing with any lame duck but with a market leader. Not only that, it is a market leader which at the present time has the confidence of both Houses of Parliament in providing prompt, accurate and secure services which are essential to the efficient working of Parliament and Westminster. Ministers are willing to set that organisation adrift. As my noble friend Lord Jenkins said, there can be no guarantee of jobs, location or even ultimate ownership. Again, I disagree profoundly with the noble Lord, Lord Jenkin. There is a difference between what I would call a stable-door-shutting action after some mess and the accountability of Ministers in this House and in the other place at the Dispatch Box.
When he spoke on 13th December the noble Lord, Lord Hayhoe, made a valid point when he said that a decade ago undoubtedly Captain Robert Maxwell and his companies would have been the leading contenders for the purchase of HMSO. He rightly warned the House:Think of the difficulties that might arise if a future Mr. Maxwell were running the company responsible for printing all our parliamentary papers!"—[Official Report, 13/12/95; co1.1326.]As I said, stable-door-slamming guarantees are of no value in such circumstances.
On these Benches we have acknowledged that over the past 15 years, through their process of privatisation, the Government have produced some outstanding British companies from the slumbering giants in the 739 state sector. The Government are entitled to take credit for that. On the other hand, we on these Benches are entitled to say that our criticisms and doubts do not come from doctrine or ideology. Where privatisation has succeeded, we have given the Government credit.
But in examining a case such as the one we are debating today, my mind goes back to over a decade ago when I switched on the television and saw one of the first television broadcasts from this House. There was a maiden speech by Lord Stockton. In that speech he made the remarks about privatisation and likened it to selling the family silver or a much loved Canaletto. It seems to me that having got rid of quite a lot of the family silver and Canalettos, we are now chopping up a Chippendale for firewood. It is the use and application of ideology to something which needs much more commonsense. I am still not clear as to how the Government intend to get the authority of both Houses for these plans. It would have been more straightforward, before they set off on elaborate consultations and putting out their puff pieces to the private sector, if they had asked in either House for a straight yes or no to the question "Do you want HMSO privatised?" I suspect that we all know why they did not do so. But this House has already indicated that this debate is not the last word on the subject. There will be need for further information and for a proper decision to be made by the House on whether or not it wants this privatisation to proceed.
The best that can be said from what we have heard today from the Government is a judgment—a judgment which perhaps the noble and learned Lord the Lord Chancellor would go along with—of "not proven". Until it is proven, Ministers can expect no support from these Benches, nor, I suspect, from many other parts of the House.
§ 5.36 p.m.
Lord Bruce of Donington
My Lords, it falls to me to congratulate the noble Lord, Lord McNally, on the very thoughtful speech that he delivered to your Lordships. The noble Lord has been in public office for nearly 30 years. He first emerged into semi-public life, as noble Lords may well be aware, as chairman of the students' union at University College. He became a leading officer in the National Union of Students and thereafter went into politics, first, as a research assistant and later as an assistant secretary to the illustrious Fabian Society. Amongst its members there have been known to be members of the Government Benches. From there the noble Lord progressed into the Labour Party headquarters itself. He became an adviser to the Secretary of State for Foreign and Commonwealth Affairs and later to the Prime Minister of the day, Mr. Harold Wilson, and to the noble Lord, Lord Callaghan. During that time he became a Member of Parliament of the Labour interest. In 1981 he moved sideways from the Labour Party to the Social Democratic Party and has continued to serve in public life in that way.
With advancing years, many of your Lordships become accustomed to vertical movement up or down, as the case may be. The noble Lord, Lord McNally, has 740 shown an ability to move more laterally. We look forward to hearing his observations in the future, particularly in those fields of public affairs in which he is very well known indeed. Your Lordships will be only too pleased to hear frequently from the noble Lord on subjects of his choice.
Possibly because of his most attractive countenance and because of his history, I cast an eye over the noble Lord, Lord Jenkin of Roding, during the speech of the noble Lord, Lord Jenkins of Hillhead. If he felt some amusement or pleasure at the speech when listening, it certainly did not show in his face. He appeared to be most remarkably discomfited. But I must congratulate him on regaining his poise. Of course, I shall have to deal in due course with some of his arguments.
The Stationery Office first came under review in recent times when your Lordships were considering a development the government of the time called the Next Steps agencies. As the noble Baroness, Lady Blatch, indicated in her reply to me the other day, HMSO has been a Next Steps agency since 1980 and is subject to Next Steps agency rules. Your Lordships will recall that one of the purposes of the establishment of the Next Steps agencies was to rid Ministers of direct responsibility for the detailed operations of agencies under their control. The rules are carefully laid down.
In December 1989 the Treasury published a document seeking to allay what it foresaw as public apprehension about the accountability to Parliament of the Next Steps agencies. Paragraph 5.1 states:As the Prime Minister has made clear, Next Steps will involve no diminution in Ministerial accountability to Parliament. Indeed, the creation of Agencies will clarify managerial responsibilities and reinforce accountability to Ministers and to Parliament. This is true both of Agencies which are,"—for example, HMSO—or become, trading funds and of Agencies financed through Parliamentary Supply".Therefore the status of HMSO is not in any way in dispute. The Government gave an undertaking that all Next Steps agencies shall remain accountable to Parliament. The matter was discussed in your Lordships' House in early 1990, after a previous discussion in another place on the Government Trading Bill. The Government Trading Bill expressly provided for changes in financing procedure and also for the complete delegation of responsibility from Ministers down to the agencies, so much so that some of us were apprehensive at that time that the bringing in of the Next Steps agencies, whether existing or to be, under the Government Trading Act of that year, would expose them to privatisation.
It is in that regard that the Government gave a number of assurances, which I have no doubt were made in good faith at the time but which enabled that measure to go through, largely after consultation between Her Majesty's Opposition and Her Majesty's Government, in which at that time I played a leading part in conjunction with the noble Earl, Lord Caithness. During the course of the debate on Second Reading I asked if he would say whether the measure itself would lead to privatisation or was a first step in that direction. He replied, 741The noble Lord, Lord Bruce, spoke earlier about privatisation and will mention the matter in more detail at a later stage. Before agencies are set up all other options, including abolition and privatisation, are examined. In most cases the examination leads to the conclusion that the nature of the services provided by the agencies does not make privatisation a feasible or realistic option. That is not to say that some activities might not be contracted out, but generally our expectation is that most mainstream activities of Next Steps agencies will continue to remain within central government for the foreseeable future".—[Official Report, 8/3/90; col. 1292.]That was the context within which the debates took place on the Next Steps agencies. The noble Earl went even further in making pertinent observations and giving undertakings which still have some validity today because HMSO is still a Next Steps agency. In the course of the Committee stage of the Government Trading Bill, I asked the Minister a question in these terms,I should like to be reassured that the other functions of the Minister in relation to the agency are not disturbed by that in any way and that we are talking about day-to-day management. I should also like to be reassured that the ultimate responsibility in terms of responsibility to Parliament and scrutiny and examination by the National Audit Office, remains intact in all cases and that … the final responsibility for accountability to Parliament will remain with the Minister of the Crown".The noble Earl was kind enough to give an undertaking in these terms,On the noble Lord's second point, I am sure that I can give him the assurance that he seeks".—[Official Report, 12/6/90; col. 228.]All the way through the proceedings on the Next Steps agencies, including those existing which includes HMSO, those undertakings still hold; they have not been repudiated in any way. Speaking again on 12th June 1990 the noble Earl said,With regard to privatisation, I note that Amendments Nos. 4 and 7 tabled in the name of the noble Lord, Lord Bruce, deal more specifically with this matter. I can give the noble Lord an absolute assurance on privatisation: namely, that the Bill does not contain power to enable a trading fund to be privatised without subsequent primary legislation".—[Col. 231.]It has never been suggested—indeed it has almost been denied—that the passing of any primary legislation will be necessary to effect the change. That is something to which we all should pay attention.
I could go on for a long time, almost to the point of being repetitious, on government undertakings given at that time regarding privatisation; that if it ever did happen—with increasing remoteness—it would need primary legislation. I sincerely hope that the Leader of the House will take note of the demand by my noble friend the Leader of the Opposition that we are given a proper occasion upon which a vote may be taken as to whether privatisation shall be allowed to proceed. In the light of their own undertakings, I should have thought it would be at least honourable for primary legislation to be brought forward, as was originally stated in this House.
The principal reason for the Government deciding to privatise appears to have been omitted. I hate to mention it—one does not like to mention money too much in this place. However, in view of government finances at the present time it may not have escaped your Lordships' 742 notice that the Government would dearly like to have an extra £100 million or so—or whatever the price of it may be, unless it is knocked down to a price which the Government ultimately have to accept for it. The sales prospects have not been enhanced by some of the remarks that fell from the lips of noble Lords opposite this afternoon. Nevertheless, that remains the position.
Why do not noble Lords come clean about this and admit that we are in the dying stages of a Parliament and that what the Government are desperately trying to do now, aside from raising money, is to make quite sure that when the next Labour Government come into office power will be retained in the private sector, where, increasingly, the Government's own placemen have been put over the past two or three years, who are likely to be reinforced by those who have already volunteered that they will not be standing again at the next election?
This is a disreputable step by the Government of which they should be thoroughly ashamed and which goes against every undertaking expressed or implied when the matter was considered in 1990. I sincerely hope that even at this stage they will have the decency and honour to withdraw it.
§ 5.51 p.m.
§ Lord Burnham
My Lords, in the debate following the Minister's Statement in the summer I asked by noble friend Lady Blatch by what name the privatised HMSO was likely to be known. This was not, as I pointed out at the time, a frivolous remark—and I repeat that now—but because I wished to ascertain where the new organisation would stand in the commercial world.
Although I note from the information pack that last year HMSO Manchester Print and Logistics lost an Inland Revenue contract, HMSO—considerable parts of HMSO, I should say—is largely protected against competition. The successful applicant for the privatised business is unlikely to enjoy this protection. It would be illogical to offer such protection in any aspect of the work because a company either is or is not privatised. It cannot have it both ways. My noble friend the Leader of the House said that it would now be able to compete fully, but it is also likely to be competed with fully. It cannot have it both ways; or if it attempted to do so it would be likely to face strong comments from the Opposition.
Although it is not the convention so to do, I should like to congratulate the noble Lord, Lord McNally, who, sadly, is not in his place, on his powerful and reasoned maiden speech. I would say that he showed all the traditional non-controversial air of F.E. Smith in another place.
In his speech the noble Lord, Lord Richard, commended the information pack and, if I may sum up what he said, asked why the Government wished to privatise HMSO when the information pack spoke so highly of it. As my noble friend Lord Jenkin of Roding pointed out, this is a sales document. The opening words of the information pack are:The Government is considering the privatisation of HMSO".743 In those circumstances, they were bound to produce what is in effect a prospectus for sale. The information pack is produced by Coopers & Lybrand and I am only too well aware of the case that Coopers & Lybrand seeks to make on any company which it wishes to sell. Therefore, what the information pack said, and what the noble Lord, Lord Richard, said, must be treated with a certain amount of reserve.
In the December debate the noble Lord, Lord Bruce of Donington, noted the increase in the cost of Hansard in another place of 1,500 per cent. between 1979 and 1995—from 45p to £7.50. I have not made quite certain of the new pricing policy for Hansard, although of course the price of Hansard in this House today is £2.50 compared with £4.20 on 13th December, the day of the Statement. But, overall, I can find very little justification for the high prices charged by HMSO for its publications.
Going through my bookshelves—this may show my interest—I find that the Employment Protection (Consolidation) Act 1978, reprinted in 1993, costs £23.80; the Broadcasting Act 1990, reprinted in 1995, costs £19.90. In contrast, the Health and Safety at Work etc. Act 1974, reprinted in 1980, costs £4.50 and the Betting, Gaming and Lotteries Act 1963, reprinted in 1984, costs £6.
These costs and these increases are too high. Newsprint and paper of similar grades cost £220 a tonne in 1979. As the noble Lord said, Hansard cost 45p. Newsprint went up to £425 a tonne in 1988–89 but then dropped by up to 35 per cent. with discounts which were accepted throughout the industry. In 1996 the cost is £495 a tonne. Hansard costs £7.20. These figures—an increase of 125 per cent.—may be said to be less than the increase in the cost of living.
Paper is the highest cost in printing. Behind it comes labour. The major reduction in the number of staff employed in the industry over the same period means that there has been a massive reduction in costs. So there should be. There has been a massive reduction in print costs everywhere because of the introduction of what has laughingly been known as new technology, and it is very surprising that the reduction in costs for HMSO for those aspects of HMSO which concern purely printing has not been very much greater.
The Official Report and other HMSO publications require speed of printing since they have to be immediately distributed. Other print work does not quite have the same requirements. While delay cannot be accepted, it is possible to fit publication into a schedule and by so doing achieve enormous economies of cost. In the case of newspapers, the demise of hot metal has, curiously, made the newspapers less up-to-date than they were. But the fact that a publisher no longer has to store quantities of lead over a considerable area, with considerable weight and considerable costs, means that reproduction of papers of all kinds, largely achieved by facsimile, is easier and far quicker, with little need to carry the vast stocks which were necessary in the past.
I suspect that any possible purchaser, on looking at the books and operation of HMSO, will find himself in an Aladdin's cave. In the debate the other day on the 744 Broadcasting Bill it was suggested that Channel 4 might just possibly need funding at some stage in the future because circumstances might change. But think of any printer given the Highway Code, for instance, to produce, with a totally guaranteed sale and repeated updates as new regulations are thought up. He would consider it to be hand rubbing time.
It is difficult not to avoid the view that the products of certain parts of HMSO—not, of course, all, for much of the business is in competition with the private sector—are overpriced or uncompetitively priced or inefficiently managed. As a newspaper manager of the 1970s and 1980s, as the noble Baroness, Lady Dean, will confirm, I know inefficient management of a printing business when I see it. However, it has to be said, to be fair to managers of those days, that life was not made easy by the noble Baroness's predecessors, particularly Lord Briginshaw, and her colleagues in other print unions.
But in all the conclusion is inescapable. The privatised HMSO will be very different from the one we know today and probably thinner and more profitable, with increased sales and turnover resulting from reduced costs and prices. There must be very many who, like myself before I entered your Lordships' House, would have liked to have acquired many of the HMSO publications but were prevented by the excessive charges made. It must be in everyone' s interest for the public to be better informed about the operation of government and ancillary matters. It cannot be impossible by keeping HMSO in the public sector, but by paying greater attention as to how it operates. But if it can be done without risk by privatisation and at no cost, provided standards are maintained—and that is the all important matter to which all noble Lords have paid great attention—the view I take on the matter is, "Why not?".
§ 6 p.m.
§ Baroness Dean of Thornton-le-Fylde
My Lords, before I make my contribution I would like to declare an interest which I regard as an honourable one. I was a regional secretary for the printing union that covered the north west. In fact in the north west we had a large HMSO establishment, but it is much diminished now. I later became general secretary and negotiated across the board the national agreement that we had with HMSO. I am today still a member of that union.
I address my remarks to the welfare of the employees of HMSO and how they and I see the proposed changes. As the noble Viscount the Leader of the House said, HMSO employed about 6,000 people and there are now just over 2,000. Similar reductions are true of a whole range of manufacturing industries. As change has been introduced, numbers have been reduced. Much of the debate both here and in the other place has concentrated, understandably, on London. But there are establishments in Wales, Scotland, Northern Ireland, Bristol, Birmingham and Norwich, which has been mentioned. In Norwich there are about 900 people employed, mainly civil servants. There are also establishments in Leeds and Manchester, where I come from—and, by the 745 way, where the boxes for a general election are stored. That is not something that we have discussed. It is not all simply a question of printing and paper. The security printing establishment where our passports are produced is in Manchester, as indeed is the bookshop. There is also of course London where the parliamentary press is in particular.
As has already been said in this debate, HMSO was founded in 1786 to make sure that corruption in public purchasing did not occur in parliamentary work. The reason it was set up was an honourable one. It is perhaps right that the age of the organisation is mentioned. I say that because today we tend to think that if something is very old—I do not include this Chamber—it is not necessarily relevant to a modern market place. But one can look at the matter in another way, and I do. HMSO would not have survived all that time if it had not changed and kept up with the times. That is why the employees feel that this move by the Government is potentially destructive for them.
It is not as though the employees have not changed. The noble Viscount referred—rightly—to the reduction in the workforce. If one looks at the statement of accounts annually presented to Parliament by HMSO, in 1993 there was £9.5 million for redundancy and early retirement paid out of the profit that HMSO made, not paid by the taxpayer. Last year's accounts, the latest ones, show that £8.2 million has been set aside for redundancies; so there is continual revision.
It is not as though HMSO has not met the targets set by the Treasury; it has met them. It is not as though HMSO has not made a profit; it has made a profit. It is still the largest print buyer in the United Kingdom. Much of the work that comes through HMSO is produced in the private sector. I say to the noble Lord, Lord Jenkin of Roding, that the private sector benefits substantially through HMSO and the contracts it negotiates.
From the point of view of employees working at HMSO, they faced the trading fund that my noble friend Lord Bruce of Donington mentioned, agency status, market testing and only a few months ago the establishment of what is called "free standing businesses", obviously approved in discussion. Yet before the ink was dry on the paper what happens? We have the announcement about privatisation.
Much has been said about government departments being given the opportunity in the early 1980s to purchase their print anywhere. I was a union officer at that time. I can remember people saying, "Of course, you know what the real name of the game is, don't you? HMSO will not get any contracts. It will be wiped off the surface of the earth because it will not be able to compete". All those prophets of doom and gloom are absolutely wrong. HMSO has competed, has changed considerably and has been and is making a profit.
Among the papers put in the Printed Paper Office for noble Lords was the Coopers & Lybrand review. I am sure that the noble Lord, Lord Burnham, was not saying, "Well, this is a prospectus. It has a lot of good news, but we do not believe a word of it". Coopers & Lybrand 746 might take exception to that. But the union representatives met with the company this week and raised the issue of market testing. Market testing is government policy and HMSO has gone through it. Equally, government policy is to have regular market testing.
One of the biggest accounts of HMSO is the Ministry of Defence. Its market testing contract is due for renewal in six months' time, just around the time when, if this privatisation goes through, the prospectus will probably be available. I ask the Minister who is to reply what will happen about that. Are the Government going to put that out for market testing? That would certainly be something that I would want to know if I was buying a company which was going through privatisation.
Much has been made in the debate about the 10 per cent. drop in the turnover of HMSO. But we cannot treat the organisation in isolation. We have to look at the recession and the cut-backs by the Government in some of their efficiency moves. If we consider printing generally in the United Kingdom, thousands of jobs have been lost and much work has been cut back because of the recession. I do not accept that there are any sound, proven business reasons why HMSO should be privatised. I do not ask noble Lords to take my word for that. In his reply it will be interesting if the Minister can confirm that as many as 40 approaches have already been made expressing an interest in purchasing the organisation. I was told today that the figure is 60. One does not get that number of bids for a lame duck. It is quite clear that this is a very ripe cherry for the picking as far as the private sector is concerned.
On 18th December in another place the Minister said:I fully recognise that a change in ownership is a source of concern for staff. However, I am convinced that it is the best means of safeguarding their future".—[Official Report, Commons, 18/12/95; col. 1282.]On what grounds did the Minister make that statement? What proof, what evidence did the Minister have for making that statement? All the evidence is that in a privatisation, as the noble Lord, Lord Jenkins of Hillhead, said, people face increasing redundancies. As regards the Minister's view that that is the best way of safeguarding the future of the staff, I have to tell noble Lords that they feel betrayed by this decision. If the Government are so sure that it is in the best interests of the staff, why not ask them at this time of empowerment? Why not ask the staff what they think? Do they not have a stake in this business? Have they not made a major contribution in its development?
The noble Viscount said that the TUPE protection would be there. What protection? It is minimal, and does not apply to reorganisation. I say that because the Government's decision is to privatise the printing and publishing sides together as one arm. Anyone who knows the printing industry is aware that that is not the model which is applied today. Printing and publishing are separate. One just needs to look at what has happened. Printing contracts are hived off to another company; the publishing is dealt with by a separate company. In that kind of reorganisation clearly a coach and horses could be driven through TUPE. There would 747 be no protection for the staff. Of course, there will he plenty of bidders wanting to buy both because they will he able to see the benefits for themselves.
Understandably, one of the major concerns of the staff is their pension scheme. The Minister in another place said that the pension scheme is non-contributory. It is not. Employees do not have pension contributions deducted from their salaries, but in the annual negotiation a notional amount of 9 per cent. is allocated for pension contributions. So, the Government aim to hive off the organisation, with TUPE protecting wages at the pay-cheque level, on top of which is a notional 9 per cent., and the Minister says that "broadly comparable" terms will be agreed for the pension scheme. What does "broadly comparable" mean? At the moment the HMSO pension scheme is salary and service-related. However, the drift in the private sector is towards money purchase schemes. Furthermore, the fact that the pension scheme is to be transferred is no guarantee that it will remain the same. Perhaps that is why the Minister said that it will be "broadly comparable". Understandably, that is a key issue for the employees.
I say that that is a key issue because if one considers the age and service profiles of HMSO's employees, one sees that long service is the norm in that organisation. Indeed, I do not know of many organisations with a turnover of over £300 million a year in which the highest paid executive receives £73,000. Is this to be another privatisation involving "golden eggs" for the company that buys the organisation? "Public service" means something at HMSO. It means something because the employees have invested their life's work in it.
Perhaps I may touch briefly on another important issue from the perspective of the employees. In both another place and this place, understandably I suppose, Members have been concerned about parliamentary publications and about "our" Hansard which we want every day, preferably being delivered before 7.30 a.m. Although I understand that, the parliamentary publications side of HMSO accounts for only 10 per cent. of the business. HMSO is accountable to Parliament. I suggest that that accountability carries with it a responsibility on Parliament to the employees of that organisation. When considering this privatisation, I suggest that we cannot consider only the parliamentary area; we must look at the organisation in the round and bear in mind Parliament's responsibility to the employees. In effect, we are the board of directors.
The noble Viscount referred to TUPE and pensions. However, with the greatest of respect to him, I must say that those undertakings were not assurances from the employees' point of view. Furthermore, I am not clear what is meant by "Parliament deciding". Does that mean that Parliament will decide what happens to the parliamentary publications side of HMSO's contracts—that is, to 10 per cent. of its contracts—or does it mean that Parliament will decide what happens to HMSO in the round? I should like an answer to that question.
I should also like the Minister to answer a question that was put to him by a number of noble Lords. I refer to the matter of who is going to decide. As my noble 748 friend Lord Richard asked: who will decide? I know that it has been said that Parliament will decide, but how and under what procedure? Will there he a vote? Will we consider a Motion and will we have a debate on the Floor of this House? I hope so. However, the key question relates to what that debate will cover. Will it relate only to the very narrow area of parliamentary publications or will it cover HMSO as a whole being accountable to Parliament? In my view, this matter must be subject to the decision of both Houses of Parliament. It should not be a government decision.
Looking back, I can only come to the conclusion that the decision was not really made in 1995. The decision to privatise HMSO was taken all those years ago at the beginning of the 1980s. This has been a step-by-step approach, seeking to get the organisation into shape in order to privatise it. I hope that I am wrong, but I think that that is a reasonable assessment. If that is the case, I would regard it as an act of vandalism and dogma. That is what the employees will feel about it. I urge the Government to think again. Why sell off something which does not cost the nation anything, which provides an adequate and full service to the nation and which has a loyal workforce?
§ 6.15 p.m.
§ Lord Hayhoe
My Lords, first I must add my congratulations to a personal friend of some 30 years' standing who in this House I must refer to as the noble Lord, Lord McNally. We have co-operated together across party lines and for non-party activities in a variety of situations for a long time and I am delighted to see him join us in this place.
I begin by paying tribute to HMSO. I had ministerial responsibility for it in rather happier tunes than those referred to by my noble friend Lord Jenkin of Roding, as I had that responsibility from 1981 to 1985. It was a time of rapid change which was extremely well managed by the then controller and chief executive, Bill Sharp. We managed to bring the whole operation up to date, to make it much more efficient and to win our contracts within the public service because of the quality and pricing of the service offered. I say that in response to the predictions which the noble Baroness, Lady Dean, has just made. I think that in those days HMSO did extremely well.
Change has continued apace, however, and the public sector market has declined. The turnover of HMSO has reduced by some 10 per cent. since 1990. The figures quoted by the noble Lord, Lord Richard, when he said that turnover had risen from £260 million to over £375 million over 15 years disguised the fact that HMSO's turnover has been in decline for the past five years. One needs to take that into account if one is to have a proper appreciation of the situation. However, I well understand that that point was not made baldly in what was essentially a selling document prepared by Coopers and Lybrand.
Alas, job losses have become more likely as a result of the changes that have taken place. As I understand the position, the Government believe that by allowing access to new markets, privatisation will protect jobs, 749 lead to improved efficiency and maximise value for money for the taxpayer who, inevitably, will remain a substantial purchaser through ministries and Parliament.
All that is of the essence of political controversy, as was manifestly clear from the speech of the noble Lord, Lord Richard, and from the somewhat over-the-top rhetorical flourishes of the noble Lord, Lord Jenkins of Hillhead.
I want to stand back from those political issues and to concentrate on the special requirements of Parliament. Having come from another place, I can testify, as can others, to the vital role that HMSO has played over the years in providing Hansard, Order Papers, Bills, amendments, committee reports and the rest. One also recalls the awful difficulties when supplies were disrupted by industrial action several years ago. Those incidents were referred to specifically by my noble friend Lord Jenkin of Roding. Taking all that into account, I am delighted that the Government have made it abundantly clear that the requirements of Parliament will be paramount—that meeting those requirements is an essential prerequisite to proceeding with the sale of what will become the Stationery Office. That has been said clearly and in terms in both Houses of Parliament and repeated at different levels of ministerial and government involvement.
Parliamentary requirements and concerns were well set out in another place in Madam Speaker's letter to the Lord President of the Council dated 28th November 1995; and in the report of the Offices Committee, which we accepted earlier today, those requirements so far as concerns this House were also specified.
The questions that need to be answered are: how will the Government and the House authorities guarantee that those onerous parliamentary requirements will be met? I accept of course that that amounts to only roughly 10 per cent. of HMSO's total activity, but so far as concerns Parliament, those are vital matters, and Ministers have made it clear that the thing will not proceed unless the parliamentary requirements are met. They have to be met, not just for a few years, not just until some financial difficulties threaten the privatised Stationery Office, or if it becomes subject to a takeover bid, but for decades to come. What long-term safeguards can be established to ensure that that will happen? How will the safeguards be structured and maintained? What sanctions will be available to this House or to another place if things go wrong? Will the availability of parliamentary papers be guaranteed if things go wrong in some way or another with the new, privatised Stationery Office? What will happen if the service becomes rather shoddy, and the papers begin to be delayed? How do we deal with that? Will it he possible for contractual arrangements to he entered into, which will ensure, so far as is humanly possible, that both Houses of Parliament will receive the service they demand and which has been made the essential prerequisite to proceeding with these matters?
I wonder whether the lawyers will be able to devise what is described by my noble friend Lady Blatch as the comprehensive contractual package that will take full account of the needs of Parliament. It is easy to say 750 those words, but, it will be jolly difficult to devise the system that will deliver upon them. I have some doubts about the future, but, nevertheless, I shall be following developments with great care. I hope that effective ways will be found to provide both Houses of Parliament with the effective safeguards that they properly demand.
§ 6.23 p.m.
§ The Earl of Northesk
My Lords, I shall be brief, if only because my contribution is somewhat more mundane than that of noble Lords who have already spoken. I speak from my interest in information technology. The particular role upon which I wish to focus is the role of HMSO as printer and publisher of the Official Report, which amounts, as the noble Baroness said, to 10 per cent. of the business of HMSO.
It could be argued that the newspaper media are no longer the natural vehicle of mass communication; that they have been superseded by the broadcast media. In a very real sense therefore, the principle of communicating our business to the people, via the expedient of the printed page, may be something of an anachronism. That begs all sorts of questions. Should our proceedings be broadcast in full by both television and radio on a national basis? Perhaps a little more facetiously (but not, it must be said beyond the realms of possibility, and a question that I pose in all seriousness) should Parliament go digital?
More than that, even as we speak, there is in all probability bandwidth on the Internet that is being used to discuss the issue of whether Hansard should be on-line. I know that to be the case, because I have been following precisely that thread in the uk.politics newsgroup. It is that that intrigues me. Whatever the future of HMSO, can our proceedings be delivered to the public in a medium appropriate to our information age? Can we expect that the Official Report will be available on floppy disc, on CD-Rom, or on both? Will Hansard establish its own "web" site?
I appreciate that such developments are not without their problems; for example, with respect to copyright. Nor would I anticipate that any IT-driven method of communicating our proceedings could or would replace the printed page entirely. Be that as it may, we need to consider carefully how it is that we wish to deliver the text of our proceedings to the wider world. In considering that we should ask ourselves whether government—any government—would meet the costs involved. My impression is that history suggests that they would not.
I conclude with a salutary observation from the "Interface" section of The Times of 22nd November last year:According to manufacturers, you would need to chop down 11 trees to get enough paper to store the same information held on just one CD. The trees would, in total, take 220 years to grow, but the CD is made in just 1.9 seconds".In our era of environmentalist concern, of sustainable development, of financial constraint, that fact should guide our thinking as to how our proceedings will be delivered to the general public in the future and as to the future of HMSO.
§ 6.28 p.m.
§ Lord Pearson of Rannoch
My Lords, I rise to support the arguments put forward by my noble friend the Leader of the House. I have to say also that I very much enjoyed the speech of the noble Lord, Lord Richard, when he exposed so much management-speak gobbledegook of the kind with which we are all so much afflicted nowadays. I must say also that if HMSO has been subjected to all the rubbish that the noble Lord so wittily exposed, I am a little surprised that it has become the commercial success that he appeared to accept that it has become.
I fear that I part company with the noble Lord, Lord Richard, when he seems to indicate—perhaps I misunderstood him—that partly because HMSO has become a commercial success, it should not be privatised. That is a point which was made by other noble Lords. I do not follow the argument that only over-manned and loss-making old state industries are those which are suitable for privatisation. I should have thought that it was more advantageous to privatise what the noble Baroness, Lady Dean of Thornton-le-Fylde, described as a "ripe cherry". Surely that will allow more stringent guarantees as to future quality to be inserted into the sale agreement. I believe that was an argument which troubled my noble friend Lord Hayhoe.
The main question I wish to put to my noble friend on the Front Bench concerns what I hope may be one aspect of HMSO's increased innovation and development, which my noble friend the Leader of the House rightly pointed out should flow from privatisation.
It is at the moment very difficult fully to understand your Lordships' proceedings as printed in Hansard for all our Committee, Report, and Third Reading debates. I say that because the Marshalled List and the groupings of amendments are not printed in Hansard. So if someone outside your Lordships' House just acquires Hansard—at a price which I agree with my noble friend should reduce after privatisation—but does not have those additional items, your Lordships' debates are, in parts, very difficult to follow. For instance, only the first amendment in a grouping is at the moment printed, and noble Lords do not always repeat their amendments when they come to speak to them.
I would like to use this opportunity briefly to pay tribute to the endless courtesy, accuracy and good humour of our Hansard writers and the Hansard office—
§ Lord Pearson of Rannoch
They seem to make sense even of some of my own speeches in your Lordships' House and I have great confidence that they will manage to do so with this one.
I would have thought that with modern technology, to which my noble friend Lord Northesk referred, the additional printing is probably not all that expensive. I hope that my additional suggestion can be borne in mind and perhaps comprise part of the future service, which I have every confidence will be as good as the one we have received so far.
§ 6.30 p.m.
The Parliamentary Under-Secretary of State, Ministry of Defence (Earl Howe)
My Lords, this has been a useful and lively debate on a subject which I well recognise to he of direct importance to your Lordships' House and another place. I listened carefully to all the views expressed and I am grateful to all noble Lords who have spoken. In particular, I wish to add my compliments to the noble Lord, Lord McNally, on his maiden speech. Delivered so soon after his arrival in your Lordships' House, it is a happy foretaste of elegant and trenchant contributions from him to which we can look forward.
Listening to the debate today, I detected two principal themes in the concerns expressed about the Government's plans to put HMSO into the private sector; first, the need to do it in the first place and, secondly, once the process is taken forward, the mechanisms which might be put in place to safeguard the interests of Parliament and HMSO's employees.
The opening speech of my noble friend the Leader of the House took us through much of the terrain in detail and with clarity. I do not propose to repeat what he said. However, it is clear that there are matters on which your Lordships would welcome further elucidation and I shall do my best to provide it.
These days HMSO is not just, as it once was, a purchasing agent and a printer for Government. It is a substantial, multifarious, commercial enterprise, competing actively with the private sector in areas as diverse as IT procurement, the provision of own-brand contract stationery, the provision of all types of reprographic services and the supply to government and the public of a wide range of publication. Its turnover in 1995 is estimated at £375 million.
However, at the same time as it is gaining in efficiency terms, its core market, the central government market, is shrinking. It cannot trade generally with the private sector, being specifically prohibited from doing so, nor, even if that prohibition were to be lifted, could it do so in all equity as part of government. In those circumstances, HMSO, effectively underwritten by taxpayers in all that it did, would enjoy unacceptable competitive advantages while at the same time putting taxpayers' money at commercial risk.
The decision to privatise is therefore not in any way a product of dogma, as the noble Lord, Lord Richard, and others suggested. As my noble friend Lord Jenkin so eloquently argued, it is the natural and sensible consequence of a situation which sees a business trying its hardest to prosper and to compete fully with the private sector but which is unable to do so because it is constrained. It is constrained from seeking wider markets and constrained from being able to invest, to borrow or to expand its activities should it choose to, because of the artificial operating environment attendant upon public sector ownership.
In those circumstances, privatisation is the only remedy which will safeguard HMSO's business and the jobs which accompany it into the long term. 753 Furthermore, it is the one course which is in the best interests of customers and taxpayers because of the savings it is likely to facilitate. That has been proved time and again.
It is in the latter context in particular that your Lordships can find considerable reassurance on the questions which most closely affect this House. A more efficient Stationery Office able to spread its costs over a wider base will deliver better value to its customers. As a most prestigious customer of HMSO, as well as being a financially important one, Parliament is in an unrivalled position to insist through the contract which it enters into with its publisher and printer that cost savings resulting from privatisation should be reflected in the prices charged to the House and to the general public. We have already had a taste of what might be achievable. As my noble friend said at the outset, the price of Hansard has come down, after remaining unchanged since 1991, directly as a result of HMSO's internal efficiencies. My noble friend Lord Burnham remarked that in 1979 Hansard was priced at 45 pence. Yes, it was, but it was also very heavily subsidised, which is no longer true.
It is through a legally binding and enforceable contract that each House of Parliament can stipulate precisely the level of service it requires from its printer and publisher. Indeed, that applies to all customers of the privatised Stationery Office. Furthermore, the buyer of HMSO will have to be fully acceptable to Parliament before either House concludes a contract. The shortlist of bidders will be published.
However, the effective delivery of services to Parliament will not rest simply on legal obligations. No new owner will put at risk the relationship that he has with his most prestigious customer. He will wish to ensure that that customer remains a satisfied customer. Indeed, without the parliamentary work other business would be less secure and less efficiently executed, creating a greater risk of future job losses. It will be of key importance.
The noble Lord, Lord Jenkins of Hillhead, entertained us all with his customary verve and style. I know that running through his amusing and discursive rhetoric he intended to make a serious point. However, I must say to him with all respect that rhetoric is no substitute for logical argument. He referred to HMSO as a proper appurtenance of the state. On what basis? He said that the Government were putting our civic traditions at risk. That, I suggest, is silly. We are talking about a Stationery Office; no more and no less.
I listened with great care to the speech of the noble Baroness, Lady Dean. The noble Baroness was correct in saying that HMSO is a diverse business. It employs about 2,900 people across England, Wales, Scotland and Northern Ireland. When HMSO's customers were freed from the tie to HMSO it did indeed have to win business. In order to do so, it had to improve efficiency and to reduce costs. It was inefficient and costly until the discipline of competition was brought to bear. HMSO is certainly not a lame duck as it stands, although I believe that its best days in the public sector 754 are probably over because the market is changing. But it may well become a lame duck if it stays in the public sector.
The noble Lords, Lord Richard and Lord Jenkins, compared HMSO with the Post Office and suggested that there was a way short of privatisation to bring the Stationery Office the benefits for which we are looking. The analogy with the Post Office is not sound. HMSO and the Post Office are different organisations, as my noble friend Lord Jenkin of Roding concisely argued, with quite different markets. The solutions to optimise their future must be tailored according to their circumstances and not according to dogma. I need hardly add that I am not here today to discuss the Post Office, but I can say that the solution for HMSO which we are here to debate is privatisation. As I said, that solution will give the best opportunities for the future.
The noble Lord, Lord Jenkins of Hillhead, asked why HMSO cannot be given more freedom in the public sector. I was surprised that he, of all people, with his long experience of government, should be asking that question. To allow HMSO carte blanche to borrow investment capital and take other commercial risks would overturn the public expenditure disciplines which quite properly exist to protect the taxpayer. That is the first point. At the same time, the fact that HMSO was ultimately underwritten by the taxpayer means that its competitors would rightly suspect unfair competition. It is worth observing that, as a trading fund, HMSO benefits from cheap national loan fund borrowing and from not having to pay corporation tax on its profits.
I should say to the noble Lord, Lord Bruce, that there is no presumption that Next Steps agencies should remain in the public sector. All agencies are reviewed every five years to assess whether they should he abolished, privatised, contracted out or remain in the public sector.
Perhaps I may correct one factual part of the speech of the noble Lord, Lord Jenkins of Hillhead. He said that there had been staff reductions of 7 per cent. since 1990. In fact, during the past five years, staff reductions have been over 15 per cent. If one looks at the picture since 1980 when the staff numbered 6,300, the reduction amounts to about 60 per cent. over 15 years.
The noble Lord, Lord Jenkins, asked what redundancies might be in prospect once privatisation takes place. I am sure that he will understand that no guarantees can be given as regards future staffing levels at the Stationery Office. However, in June 1994, the then chief executive warned that there could be further reductions of up to 30 per cent. That is the future in the public sector. While there may be reductions in the private sector, as I have argued, the long-term future will be more secure because of the opportunity to grow in wider markets.
I can say emphatically, in particular to my noble friend Lord Jenkin of Roding, that the past 16 years of Conservative government have made a thing of the past the difficulties arising from industrial disputes. My noble friend was absolutely right in what he said because, thanks to the policies of previous Conservative administrations, industrial relations problems are very much a thing of the past.
755 The noble Lords, Lord Richard and Lord McNally, place stress on having further parliamentary scrutiny of the Government's proposals. There are two strands to that point: the first is the selection of the buyer; the second is the proposal itself. The Speaker in another place made clear to my right honourable friend the Chancellor of the Duchy that the selection of a buyer is for the Government and not for the other place. The question for Parliament is with whom it should contract for its services and on what terms.
I can say to the noble Lord, Lord Richard, in particular, that the information memorandum will indeed be made available to your Lordships. This House will be treated the same as the other place. The Clerk to the Offices Committee will be sent a copy of the information memorandum when it is available. That will be a commercially sensitive document and there will need to be certain conditions attached to its handling. But I hope that that is some reassurance to the noble Lord.
§ Lord Richard
My Lords, I am grateful to the noble Earl for giving way because I wish to be clear about this matter. Is he telling the House that there will be no opportunity for this House to take a decision on the merits or otherwise of the Government's proposals and that we are limited to taking a decision on who should be the buyer and also the contract in relation to parliamentary papers? Is that what we shall be confined to? If so, I do not believe that he will find that acceptable on this side of the House.
My Lords, perhaps I may clarify what I have said. As I mentioned, the question of parliamentary scrutiny has two strands. The second strand is the privatisation proposal itself.
Perhaps I may deal with something which the noble Lord, Lord Bruce, said before I directly answer the noble Lord, Lord Richard. The noble Lord, Lord Bruce, referred to the Government's undertaking in 1990 to introduce primary legislation whenever a trading fund was to be privatised. I believe that he will have received an answer to the question on this subject which he raised in the debate in December from my right honourable friend the Chancellor of the Duchy, so he will already know the position. But, for the benefit of all your Lordships, perhaps I may say that the Trading Act will not be used to privatise HMSO. The undertaking in 1990 was given in a context when primary legislation was always required for privatisation for technical reasons associated with the terms on which civil servants would transfer to their new employment. Those shortcomings have been resolved and there is no need for primary legislation. The 1990 undertaking is not breached because it is simply not relevant.
The fact is that the House heard the Statement last month and has now had a debate. The question of privatisation is now for the Government while the question for the House is that of the contract for the supply of services.
§ Lord McNally
My Lords, as a new boy, I really am confused. However, I believe that the Minister's reply is no to the question put by the noble Lord, 756 Lord Richard, the noble Baroness, Lady Dean, and others as to whether the House is to have an opportunity to debate the matter.
My Lords, my understanding is that there is no legal need for Parliament to vote on the matter. But, of course, Parliament and your Lordships' House are free to debate it again if that is decided through the usual channels. I am certainly not pre-empting such a decision.
The more fundamental point is that the Government want the best buyer to take forward successfully the Stationery Office. The House will want the best possible supplier of services. I suggest that it is right and proper for the Government and both Houses of Parliament to work in concert to see that their mutual objectives are attained.
The noble Lord, Lord McNally, was worried that after privatisation Parliament would no longer be able to call upon a Minister to explain the performance of HMSO. Ministers are accountable only for matters based on government policy. Day-to-day operational matters arc already quite properly the responsibility of the chief executive. There is little difference between that system and the appropriate representative of the privatised company being called to account by the House under its contract with the company. Private sector companies are quite used to such arrangements in their daily relationships. Indeed, the House already buys services from the private sector and I am not aware that the absence of a Minister to answer on the provision of those services has led to a poorer service. However, there would continue to be a Minister responsible for the residual HMSO which would, if the House and another place so wished, administer parliamentary copyright.
§ Lord Harris of Greenwich
My Lords, I apologise for returning to this point but I am in a state of mild confusion. The discussion of the Offices Committee on this matter resulted in the laying down of a number of conditions which, in its view, would have to be met in order to ensure that the rights of this House were preserved. Is it being said that ultimately, there is not to be a debate in this House on the very question dealt with by the Offices Committee; namely, whether that which we are to be offered by the new private sector supplier of those services meets those conditions or not? Surely that is the least that we can ask for.
My Lords, there could well be such a debate. As I said, I would not wish to pre-empt a decision of your Lordships through the usual channels to that effect.
§ Lord Peston
My Lords, I apologise for interrupting the Minister. Although I have heard only about half the speeches in the debate, I did hear that of the noble Lord the Lord Privy Seal. I understood him to say, not that there could be, but that there certainly would be, such a debate. It seems to me that there is a certain amount of backtracking going on. It ought to be absolutely clear-cut.
757 I should, perhaps, declare an interest as I too am a member of the Offices Committee. I was never in any doubt until this minute that we would debate the report of the Offices Committee on a Motion to be put before your Lordships. However, I now find myself astonished at the noble Earl's current replies. They do not correspond with anything I understood to be the case.
My Lords, I am sorry for that fact. The noble Lord, Lord Peston, was indeed present for the opening speech, but I did not see him in his place for the rest of the debate. It is a matter for the usual channels to decide. With great respect to my noble friend the Leader of the House, I must point out that he could not have given such an undertaking because it is not within his personal gift to do so. We are perfectly open on this side of the House to such a suggestion from the Benches opposite. We shall listen constructively to any proposals.
§ Lord Jenkin of Roding
My Lords, I expressed strong support for the Government's policy in this regard. However, in the course of my speech I said that it was enormously important that we achieved the safeguards spelt out in the report of the Offices Committee. It seems to me to be inconceivable that the Government could expect to proceed with the matter without giving the House the opportunity to have a yea or a nay as to whether or not the proposed terms are acceptable. I hope that my noble friend the Minister would feel able to give that undertaking.
My Lords, I entirely take my noble friend's point. However, I return to the fact that it is a matter for the House to decide. Indeed, it is for your Lordships to decide.
§ Lord Jenkins of Hillhead
My Lords, with the greatest respect, I believe that the noble Earl is talking nonsense. When the Leader of the Opposition—and I take the same view as the noble Lord—says strongly to the noble Viscount the Leader of the House that there must be a debate on the matter it is plain nonsense for the noble Earl, sitting alongside the Leader of the House and the Government spokesman, to say that a government undertaking cannot be given on the issue.
My Lords, I believe that the message has reached these Benches very loudly that there is a general desire in your Lordships' House for a debate to take place on the matter. That is no more and no less than I would have said earlier. Indeed, I am neither oblivious nor deaf to the proposals that have been made.
§ Lord Richard
My Lords, I am sorry to interrupt the noble Earl, but, with the greatest of respect, the matter will go on until. we receive a little more satisfaction. I know that I am irritating the people who are participating in the next debate, but I believe that the Government must give the undertaking that they will provide time for a debate on the matter at the appropriate time. For heaven's sake, why on earth can they not do so? I thought that they had already agreed to do so half a dozen times. Indeed, they said so in another place. It seems to me that the Government must 758 be in a position tonight to satisfy the obvious desire of the House to have a debate on the matter when, if necessary, a vote can take place.
My Lords, I do not believe that there is any distance at all between myself and the noble Lord. As I said, the House has expressed a wish to have further debate on the matter. I am sure that from our side of the House we have no objection to that at all. It is not within my personal gift to agree to it, but my noble friend the Leader of the House—and, indeed, the usual channels on all sides of the House—will no doubt decide the question after today's debate is concluded.
Lord Bruce of Donington
My Lords, a little earlier in his speech the noble Earl was kind enough to indicate that he disputed my account of the undertakings given to this House about the necessity for primary legislation before any of the Next Steps agencies were privatised. I should like to give the Minister notice that I intend to persist in my contention that the undertaking that was given ought to apply. The utmost pressure will be exerted through whatever channels necessary, either in this or the other place, to ensure that the Government honour obligations that were freely given.
My Lords, I suggest that the noble Lord reads what I have said in Hansard. I was not in the least suggesting that the undertaking was not given; I was saying that it was no longer relevant because the law has changed and there is now no legal need for primary legislation.
I am aware that my time is slipping away, and I do not wish to detain your Lordships for longer than need be. Perhaps I may continue by saying that we have already begun consultations with the authorities here and in another place on the contractual and other safeguards which will be needed. We shall continue those consultations throughout the sale process. My right honourable friend the Chancellor of the Duchy of Lancaster has also given evidence in another place to the Finance and Services Select Committee on the sale, and, as my noble friend the Leader of the House said, he would be happy to appear before other Select Committees as required. Parliamentary officials will advise the Government on Parliament's needs which will assist the Government in drawing up criteria for selecting a new owner and, indeed, in the choice of the new owner.
The noble Lord, Lord Jenkins of Hillhead, asked what would happen if there were a future takeover following privatisation. I believe that there are several answers to that question, but the most powerful one is that the contract with this House can provide for termination in the event of a change of ownership. Given the importance of parliamentary business to the company, I suggest that that is a powerful deterrent.
My noble friend Lord Northesk identified one of the most interesting issues of the day in raising the question of the developing relationship between electronic and paper media. He was right to suggest that that is an important matter for the House. The Government already put information on to the Internet and the policy in that area is developing. However, Hansard is a matter 759 for your Lordships' House. Certainly the contract with the privatised business should allow the House to take advantage of any technological developments which offer benefit to the public interest.
My noble friend Lord Pearson asked whether editions of Hansard might include publishing our Committee, Report and Third Reading procedures, complete with a Marshalled List and amendment groupings for the day. At the risk of repeating myself, I believe that that is essentially a matter for the House authorities. If the material can be made available for printing at the appropriate time, I am advised that there would be no practical difficulty whatever to that suggestion; indeed, I am grateful to my noble friend for making it.
The noble Baroness, Lady Dean, asked what was happening to the market testing of MoD business. The MoD is currently taking advice from consultants on future arrangements for its stationery and printing requirements. It is likely that the present agreement will be extended for a short period—that is, one or two years—so that the MoD can plan and execute a well-structured market test.
The noble Baroness also spoke about TUPE. I believe that the essence of what she said was that TUPE offers only vague and inadequate protection to employees, especially in respect of pensions. I do not accept that argument. Both the Government and likely bidders are well acquainted with implementing TUPE and ensuring that staff are treated fairly as a result. I see that the noble Baroness wishes to intervene. I give way.
§ Baroness Dean of Thornton-le-Fylde
My Lords, I am most grateful, we must have the record straight. I should point out that TUPE does not cover pensions.
Indeed, my Lords; I was about to say that the noble Baroness was perfectly right to say that pensions are not covered by TUPE. However, as she said, bidders will be required to offer staff a broadly comparable pension scheme, certified by the Government Actuary. The noble Baroness also asked what we meant by the phrase "broadly comparable". The Government Actuary will examine the buyer's pension scheme to ensure that, from an actuarial standpoint, it is broadly comparable. Of course, the Government Actuary is experienced in assessing such proposals. The assessment includes a comparison of the level of contributions and ensures that any increase in contributions is offset by compensation elsewhere in the package, for example, a salary rise. As regards TUPE, I must point out that staff cannot be worse off solely as a result of the transfer. That is the strongest protection that anyone could sensibly give.
HMSO has operated on a commercial basis from within government for many years. Its customers are perfectly well used to market testing its services and entering into formal agreements with it. Privatisation will not change that and the new business will be under the same imperatives to provide the best possible service and to keep all its customers satisfied. However, it will allow the business to capitalise fully on its reputation for quality and reliability and thus safeguard the future of a distinguished organisation.
760 The fundamental point which I must reiterate is that HMSO is in decline in the public sector. As long ago as June 1994, the then chief executive warned that up to 30 per cent. of the then current jobs would have to be lost. It is worth repeating what he also said; namely, that staffing levels critically depend upon the level of business that is won. But, as I have indicated, HMSO's core market is shrinking. To allow it unfettered freedom to seek new market opportunities underwritten by the public purse would be unfair to private sector businesses. But without such opportunities there is a real risk of a downward spiral in HMSO's fortunes with all that that means in terms of job losses despite HMSO's outstanding reputation and the undoubted dedication of its staff.
Retaining HMSO in government would only do one thing; it would jeopardise the future of the business and its staff and do them a gross disservice. That is not a route which commends itself to Her Majesty's Government. Privatisation is the only means of securing the best interests not only of the business and its staff but also of its customers and therefore the taxpayer too. I commend the Government's plans to the House.
On Question, Motion agreed to.