I shall also speak to our amendments and to the government amendment. I thank the Minister for having gone through the Government’s motivation here in some detail. I am not completely against privatisation; I understand why the Government might want to do it. However, I think it is a great shame because it is too early and, as my noble friend Lord Stoneham has mentioned, the taxpayer will not get full value if we do this at the moment.
I am afraid that our own amendment is very imperfect. In a way, it is a probing amendment. I had rather hoped that the Government’s amendment was also probing because it is about something that is far too fundamental to bring to a Grand Committee, where we cannot vote on the subject or the amendment. There is a real problem there about scrutiny.
As my noble friend said, the Green Investment Bank has been a huge success. I went along to its third annual general meeting when the Secretary of State announced the Government’s intentions, and heard
about the great things that the bank is doing. Indeed, the Conservative Party should take great credit for it; the bank was in its 2010 manifesto, which said:
“We will create Britain’s first Green Investment Bank, which will draw together money currently divided across existing government initiatives, leverage private sector capital to finance new green technology start-ups”.
That was a great vision, which was taken on in the coalition agreement after the Wigley commission, which was set up by the Conservative Party. It was in our manifesto and possibly in the Labour one as well. Anyway, there was consensus that it would be an excellent institution, as it has turned out to be. I have talked to the chief executive, Shaun Kingsbury, on a couple of occasions, one of them fairly recently, and the first thing I did was to congratulate him and his team on everything that they had achieved.
However, the fundamental problem here, even if we accept that privatisation is going to have to happen—that is not all bad, even if it is slightly early—is that we have no idea how slow or fast there will be mission creep, in terms of the way that the objectives or the memorandum and articles of association of the company might change in future. The government amendment takes away all restraint in terms of legislative boundaries and replaces them with nothing. I deal with companies, most of which are private limited companies as opposed to public limited companies, but it is my understanding that any constitution of a company can be changed, certainly by resolution of 75% of the shareholders. Nothing can be done about that. So I am very concerned that we are taking out the five principles within the previous Act that laid down very precisely what should happen, and which indeed have been the basis of the success of this organisation, its vision and motivation. The question is: how do we keep those principles and that direction for the long term?
I was particularly interested in my noble friend’s example of 3i. I have some experience of 3i, as someone else who was in that field for a while. It was set up under the Bank of England soon after the war as the Industrial and Commercial Finance Corporation, mainly with private bank money but very much under the purview of the Board of Trade. In 1983, it was let loose into the market to carry on its work. Originally, it was established to deal with SMEs but its current website features very large mid-cap companies. Its investors will probably not get out of bed for a deal worth less than £50 million to £100 million. It closed all its regional offices as time went on and has a very strong international portfolio. In fact, it rightly brags that it has teams in some nine or 13 countries across the globe, yet it was set up to stimulate SMEs within the United Kingdom. Many years later, this is where it has got to.
I also question whether it is necessary to take this section out. I have talked to staff at the Office for National Statistics and looked at the websites and at the European System of Accounts—ESA 2010, as I am sure the Minister has. If she has, she probably fell asleep after the second paragraph, as I almost did. One of the things that came over to me from looking at ESA 2010 was its impreciseness and the degree of interpretation that was possible. When I looked at the Postal Services Act 2011, which privatised Royal Mail, strangely enough I found articles of special legislation
that restrain what the Royal Mail can and cannot do. Section 29 of that Act is headed “Duty to secure provision of universal postal service”. Section 30 talks about the details of the “universal postal service” provision and Section 31 even talks about detailed minimum requirements of that provision. It seems to me that Act deals with exactly the same thing, in that a constraint could be imposed by a regulator in that instance but a constraint could be imposed in this instance by one of the many successors to the Financial Services Authority, which is now the FCA. I am sure that provision could be transposed into this legislation.
This boils down to two things. First, for this to move ahead we have to have an anchor to make sure that this organisation stays within the role it is meant to fulfil. I completely agree with my noble friend that we need value for taxpayers’ money, although that may be difficult to achieve given the speed at which the Government are proceeding. Secondly, as shown by the Royal Mail privatisation, which is no longer a public body and does not appear on the public accounts, there is no certainty at all that the provision I am discussing is not needed. I ask the Minister to provide us with the advice that she and the department have received from the Office for National Statistics so that we can assess it for certainties, uncertainties or probabilities. I understand entirely why this has happened but I reiterate that it is unfortunate that such an important government amendment has been brought forward in Grand Committee, when we cannot vote on it. That is a fundamental problem and we need to consider how we move it forward in this Committee.