NEW FRANCHISE TO MALAYAN AIRWAYS LIMITED

Mr Lee Kuan Yew asked the Minister for Communications and Works what is the position of the new franchise to be granted to Malayan Airways Limited; when can the House expect that its terms and conditions will be communicated to it; and whether the Government will initiate a debate in the Assembly in respect thereof.

Mr Francis Thomas: The position as to a new franchise is at present somewhat uncertain. We have been unable as yet to reach a conclusion regarding the new franchise and have already had to extend the old franchise up to 31st July, 1957 in order to continue negotiations about the future structure and services of Malayan Airways. It has now become clear that a further extension will be necessary.

I might explain that early this year we had reached a point at which the signing of a new agreement and the holding of a debate in the Assembly in connection therewith appeared imminent. Since then, however, a situation has arisen which has made it necessary to review the action already taken and to study new factors, and new proposals made thereon, which affect the new agreement. Negotiations are still proceeding in the light of these new proposals. For this reason, and also because the matter involves five Governments as well as the airline operators, I am unable to go into detail.

I can, however, properly say that the new factors and the new proposals to which I have referred have raised issues of sufficient importance to warrant the holding of personal discussions between the five Governments and the airline operators at a high level, and hon. Members will doubtless have read in the local Press that these took place in Singapore on 15th and 16th July. They have been adjourned till about 9th or 10th August. If by that date the negotiations can be successfully completed - and I most sincerely hope that they will be - certain other action will remain to be taken both by the Government and by the airline operators in connection with the structure of the new company. It is generally agreed that the whole operation will require a further three-and-a-half or four months to complete. Action is therefore being taken to extend the present agreement for a yet further period up to 30th November, 1957.

I can assure the House that we are pressing on with the utmost urgency and as soon as possible the House will have an opportunity of debating matters connected with the new agreement before it is signed.