Pensions: Deepwater Horizon

Debate between Lord King of Bridgwater and Lord Freud

Wednesday 9th June 2010 Lords Chamber

[Lord Freud]

My Lords, that is a deeply political question. Clearly, the emotions raised in the US by this tragedy are enormous. There will be repercussions in the US and in the world as a whole with regard to attitudes towards oil companies. The best that I can say is that we will be watching this space for months to come.

[Lord King of Bridgwater]

My Lords—

--- Later in debate ---

[Lord King of Bridgwater]

My Lords, do not the directors have a duty to the board and the shareholders to meet their correct obligations in full on the serious issues that have arisen in the United States? That must be fully recognised. Having done that, and having made proper assessment of what those are, they also have to recognise the duty to their shareholders in terms of whether to pay a dividend.

[Lord Freud]

My Lords, I thank my noble friend for that question. Clearly, the BP board has to make some complicated decisions, which are a mix of the financial and the political. Market estimates of the cost that the company will have to pay are in the region of £15 billion to £20 billion, although that is purely market speculation and I make no comment about what the Government expect them to be. The company will have to decide in that context whether it is appropriate to pay a dividend.