The Queen's Speech: Prescott tries to calm MPs' fears over air safety

A COMPROMISE is planned over the part-privatisation of the National Air Traffic Control Services to reassure unions and Labour MPs safety will not be sacrificed.

Critics of the sale of Nats - confirmed yesterday - warned that the legislation will be one of the main battlegrounds for the forthcoming session of Parliament, triggering a big revolt by Labour MPs. John Prescott, the Deputy Prime Minister, will issue a Transport Bill within days, containing the enabling legislation for the sale.

But the Bill will not contain the crucial detail on the sale of shares in Nats. Regulations will be published next month, setting out how the Government intends to sell off the shares. Whitehall sources said the Bill will contain a range of assurances, including hiving off the safety regulation to keep it in public ownership. The Government will also retain a "golden share", giving Mr Prescott a veto over strategic decisions by Nats under a partial private control.

A government source denied that Mr Prescott was planning a climbdown over his proposal for the Government to keep a minority shareholding of 49 per cent. But the decision to delay the detail of the share sale until after the publication of the Bill will be seen as a clear signal that the Government is prepared to listen to the unions, airlines and MPs.

Mr Prescott is proposing to give 6 per cent of the shares to employees and to sell off a 45 per cent stake to the private sector. However, the employees have said through their unions that they oppose the sale, and do not want the shares. Government sources indicated last night that a bigger stake could be sold to the private sector. But it is clear there will be intense negotiations with the unions to ease their safety concerns.

"We are prepared to listen to the unions and the MPs but nobody has come forward with a better way of achieving our aims," said a government source. Mr Prescott is planning to raise pounds 10bn over 10 years to invest in new technology. Giving Nats some private sector involvement will make it free to bid for foreign business, in- cluding potentially managing air traffic over Greece, Spain or Ireland as Europe moves to integrate services covered by 40 separate bodies.

The hints of a compromise came as a powerful alliance emerged yesterday between the country's biggest airlines and union leaders in an attempt to take the profit motive out of privatised air traffic control. Leaders of pilots' and controllers' unions have publicly backed a consortium including British Airways and Virgin to create a "not for profit" company to take a major stake in the service. This option would address the anxieties of Mr Prescott's critics that the profit motive is inimical to safety and that he was in danger of creating a "Railtrack of the skies".

While repeating his opposition to the sell-off, Christopher Darke, general secretary of Balpa, the pilots' union, said that if there had to be a sale it should be to a group such as the nine-strong airlines' consortium. "There should be no sale to a company out to make profits from an operation whose prime role is safety. We've seen what happens when you do that at Railtrack."

Iain Findlay of IPMS, the union representing controllers, said the airlines' group would be the best option because it would be not be run at a profit and would be fully aware of the problems of air safety.

Colin Brown and

Barrie Clement