Draft Transport Act 2000 (Designation of Transferee) Order 2001

[back to previous text]

Ms Sandra Osborne (Ayr): I add my welcome and congratulations to you, Mr. Pike. I also congratulate my hon. Friend the Under-Secretary on his new appointment. I shall concentrate my remarks on section 51(a) of the Transport Act 2000, but I look forward to hearing the answers to the questions asked by the hon. Member for Poole (Mr. Syms) about the 5 per cent. employee shareholding.

I hesitate to contribute to this short debate because my colleagues are probably heartily sick of hearing me speak about the new Scottish air traffic control centre. I realise that the subject is becoming quite boring for some, but I hope that the Committee will bear with me, given that that the provision of facility is extremely important to my constituency, securing some 700 jobs and £25 million a year for the local economy.

The Minister referred to my amendment to the Transport Act which incorporated a commitment to new Scottish centre. He said that it took some time for the House to consider the Bill, especially part I. That is a diplomatic way of putting it; I might have used slightly different terms. I recognise that the Government would not have wanted to revisit the issue and I am very grateful for further entrenchment of the provision in the form of this essential secondary legislation, which will ensure that such projects will go ahead. However, for reasons that I shall explain I should like my hon. Friend to reiterate exactly what the provision will mean—preferably in terms as explicit as he can muster. Although I have already heard such comments from our right hon. Friend the Deputy Prime Minister, they bear repetition.

I have made it clear on several occasions that I understand the cynicism of the work force at Prestwick, given that such projects have been delayed for many years. Although the Government have allocated public money to the new Scottish centre, factors such as the previous Government's adoption of a two-centre strategy, the failed private finance initiative and the PPP have caused delay, which has led to uncertainty and frustration among the NATS work force in my constituency and given rise to constant speculation that the project will not go ahead.

Representatives of the NATS work force told me that the PPP should have been the focus of my concern as the constituency Member of Parliament, not an amendment to incorporate a commitment to the new Scottish centre. Some even said that they never doubted that the centre would go ahead, but I have a plethora of letters in a thick file that tell a very different story. Anyone present during the Ayr election for the Scottish Parliament will have witnessed a campaign by trade unions and others based on the supposed threat to the new Scottish centre. I was therefore justified in tabling the amendment—indeed, as constituency Member of Parliament it was my duty to do so.

The PFI has also been dropped for the oceanic contract—known as flight data processing system 2. NATS intends to tender for a new oceanic system but, as I understand it, that cannot be done until a strategic partner has been chosen, because the partner will want a say in choosing the successful bidder for the contract. Incidentally, the hon. Member for Poole mentioned the bidders for the strategic partnership, and I want to put on the record my preference for a not-for-commercial-profit bid, which would go a long way towards promoting safety and securing much greater public confidence. According to NATS, the delay should not be too great because a couple of oceanic systems are already available, so it will not be necessary—as it was with the previous contract—to start from scratch. I seek reassurance from the Minister that the oceanic system is part of the bidding process and that a commitment to build the new centre in Scotland will be entrenched in the regulations.

Finally, despite my amendment to the Bill, some people do not believe that the new Scottish centre will be built—indeed, the trade unions condemned me at a recent conference for failing to secure that. Both Government and Opposition Members know that, whatever my concerns about PPP, my first responsibility has been to secure the new Scottish centre and they recognise that I have worked assiduously towards that end. However, a section of the work force will not recognise that, which is sad because their jobs are being secured and new jobs are being created. Hopefully, today's debate will help to persuade those doubting Thomas's that the new Scottish centre and the oceanic centre will go ahead. I ask the Minister to confirm that, in a phrase reminiscent of the first section of the Scotland Act 1998, ``There shall be a new Scottish centre.''

Mr. Don Foster (Bath) rose—

The Chairman: Order. Before I call Mr. Foster, I should state that although I have allowed a little leeway, we must keep in order and not debate issues that were fundamental to the passage of the Transport Act 2000.

4.51 pm

Mr. Foster: I, too, welcome you to the Chair, Mr. Pike. I look forward to many hours working under your chairmanship.

I intend to raise more questions about the proposal than the hon. Member for Poole. For the Committee to support the proposition put forward by the Minister, he must assure us that the procedures that the Government will adopt to enable them to go ahead on 31 March, which is the date that he set, are correct and that due diligence is being observed. The Committee is sitting only because the Government were unable to name on the face of the Transport Act 2000 what he has now referred to as NATS No. 2. Had they done so, it would have been a hybrid Bill, which would have required several additional parliamentary procedures. Because the Government were anxious to push the PPP through as quickly as possible, they chose not to include NATS No. 2. Therefore, before we decide which way to vote, it is important to obtain several assurances about how that organisation is intended to operate.

Given the importance of the issue, why have the Government refused the joint request from the Conservative and Liberal Democrat parties to have the debate on the Floor of the House? The request was raised with Government Whips through the usual channels, but it was refused. The Committee will be aware that many Labour Back Benchers signed early-day motion 219, which relates directly to the choice of the preferred strategic partner. Other than the existing NATS organisation, what criteria will the Government adopt in selecting the other part of NATS No. 2?

We shall have NATS No. 2 on 31 March. It will comprise the existing structures of National Air Traffic Services and its new strategic partner. We are aware that the Government have received and are analysing three significant bids from organisations that want to become the preferred strategic partner. At no time have the Government sent us details of the procedures adopted to evaluate the bids; nor have we received any suggestion as to what issues will be borne in mind.

The hon. Member for Poole said that, in another place, the Minister for Transport made it clear that transport safety was to be the No. 1 priority and that, whatever other factors were involved, all three bids would be judged on whether the Government could be assured that safety would be the key issue. When the Minister responds, I hope that he will repeat that statement. I also hope that he will indicate the other criteria to be used by the Government in their assessment, and what weight is attached to each criterion. For example, how much money the Government receive for selling off part of air traffic services is clearly significant: the taxpayer will want to know how much the Government will receive and where that comes in the list of priorities. If safety is the No. 1 priority, the financial return will not be the top priority, but where does it lie in relation to other criteria? I also want to ask the Minister some questions about the three current bids. They will be directly relevant, as we are deciding whether to allow the procedure to go ahead. We must be assured that we will feel reasonably comfortable with the body to be created and with how it will deal with the relevant issues.

The first bid is from the Airline Group. Eight United Kingdom airlines have united to produce the bid, the distinguishing feature of which is that the organisation will not be intended to make a commercial return. I understand that that is not the same as a not-for-profit scheme: although the company will be required to make a profit so that it can pay off debts or pay towards investments, it will not expect to declare a dividend to any shareholders. That is much in line with the sort of trust model that many hon. Members were eager to have developed.

However, we must ask whether the Airline Group will be able to provide, for example, sufficient extra input of the relevant managerial skills on which the Government say that they are keen. Will the Minister tell us where managerial skills come in the Government's order of criteria? What weighting is given to them? Has he and will he consider whether there is a danger that the bid will concentrate too much on UK airspace rather than marketing NATS No. 2 more widely? How important is it that the successful bidder helps NATS to expand into Europe and elsewhere, or should it concentrate on ensuring safety in the skies above our country?

The Minister must also address possible conflicts of interest. Such a conflict might arise in the case of the Airline Group: for example, the eight member airlines of the group might be given an advantage through the work of air traffic control over airlines that are not members of the group. That is unlikely to happen, because we already have good evidence of airlines working successfully together, for instance in the slot distribution system through Airport Coordination Ltd.: airlines that are not members of that organisation never complain of unfair treatment. However, a conflict of interest might arise and we need to know what action is being taken to prevent that.

Where does the issue of the coherence brought by the various members of any of the proposed consortiums fit into the list of criteria, and what weighting is given to it? The Airline Group consists of eight airlines and many different bodies with different relative strengths. How will that work—in particular, how will British Telecom, which is another partner in that scheme, fit in? What energy will BT bring to the venture, which must be a relatively small part of its main activities?

The Airline Group's bid has some clear advantages—I think that the hon. Member for Ayr shares my view on that. It fits culturally with the work that NATS will do, especially on the crucial issue of safety. A commitment to long-term involvement will be required. I hope that the Under-Secretary will make evidence of such commitment a criterion when considering the bids. What evidence is he demanding from the bidders of their commitment? As I said earlier, the Airline Group's not-for-commercial-return approach is closest to the trust model preferred by the Liberal Democrats.

I shall deal with the other two in the same way. Additional criteria should be used in assessing them if we are to be confident that we want to adopt the NATS No. 2 scheme proposed for 31 March. I stress that with care, because I want to ensure that I am in order. The Minister has pointed out that the Government will own only 49 per cent. of the operation; 51 per cent. is going elsewhere, of which the lion's share will go to one of three bidding groups. Today we are to decide whether or not to let that happen, so I want to ensure that the Government know exactly how they will go about the process.

The second of the two bids is that of Novares, which is a consortium consisting of Lockheed Martin and Airways Corporation of New Zealand.

Previous Contents Continue

House of Commons home page Parliament home page House of Lords home page search page enquiries ordering index

©Parliamentary copyright 2001
Prepared 12 February 2001