FURNITURE INDUSTRY DEVELOPMENT COUNCIL (AMENDMENT No. 3) ORDER 1967

HL Deb 17 July 1967 vol 285 cc147-59

9.12 p.m.

LORD WALSTON

My Lords, I beg to move, that the Draft Furniture Industry Development Council (Amendment No. 3) Order 1967 laid before the House on July 5, 1967, be approved. This Order is made under the authority of the Industrial Organisation and Development Act 1947, and is subject to Affirmative Resolutions of both Houses of Parliament. It amends for the third time the Furniture Industry Development Council Order, 1948 (S.I. 1948 No. 2774) which set up a Development Council for the furniture industry.

As noble Lords may remember, the Furniture Development Council was set up in order to help the furniture industry increase its efficiency and thereby improve the services that it gives to the public. During its life the Council has helped the industry in many ways, such as production, management and engineering, financial control and costing and marketing. In 1961 the Furniture Industry Research Association has handled on behalf of the Council its responsibilities for scientific and technical research. These two bodies worked closely together, and a large part of the levies which the Council collects from the industry is passed on to the Research Association to help with their work. By Statute the work of the Council is re-assessed every five years. The last review took place in 1966 and as a result certain changes were decided upon. The object of this amending Order is to give effect to these changes.

First, it is proposed that the form of the levy should be changed, and secondly, it is proposed that the catchment area should be spread a little wider so as to bring in those who make certain types of built-in furniture and who have hitherto not paid the levy. As a result, the Council will have somewhat more funds at its disposal, and therefore will be able to give still better service to the industry. In 1948, when the orginial Order was drafted, built-in furniture did not represent a significant part of the industry. Now it has grown greatly in importance, and it must be right that domestic built- in furniture should pay its share to the funds of the Council. Specialised built-in furniture used exclusively in offices, schools or hospitals is still excluded. It has not been easy to define these different categories in the Order and there may be some awkward borderline cases. However, I am sure that the Council will deal with these matters with common sense as they arise.

The furniture industry as a whole is in favour of these proposed changes; but the British Woodwork Manufacturers' Association, who represent employers in the joinery, timber, engineering and industrial building industries did not welcome the proposal. In this they are joined by the Amalgamated Society of Woodworkers. There is, of course, inevitably some overlapping between the joinery trade and the furniture industry; as the trend towards built-in furniture increases so the line between joinery work and furniture manufacture becomes more blurred. But I want to make it clear that the levy is not being imposed on all products of the joinery industry, such as doors or window frames, but only on built-in furniture units. I would assure the joinery industry that they are getting a good return for their investment from the Furniture Industry Research Association and the Furniture Development Council. I am sure that the work of these two organisations will prove just as valuable to them as it has to the furniture industry.

The third major purpose of the Order is to take into account various technological changes which have taken place in recent years. Just as one example out of many, in the past upholstered metal furniture has been included for levy purposes while metal furniture which is not upholstered has not. There is no good reason for preserving this distinction. Fourthly, the Order safeguards the position of the small man who may make "built-in", metal or some other furniture on a small scale. The Order provides that he should be excluded from levy payment if his turnover of leviable items is £3,000 per annum or less. This is a new provision. The position now will be that if he makes domestic furniture in the sense of the Order, he will be required to register and will be eligible to receive the benefits of the Council's services without charge, but henceforth he will not have to pay levy. This type of encouragement, of course, is one of the things for which Development Councils were set up.

Finally, my Lords, I should like to thank various other Government Departments which have helped us in the preparation of this Order, and also the Directors of the Furniture Development Council and of the British Furniture Manufacturers Federated Associations, and the General Secretary of the National Federation of Furniture Trade Unions. They have all helped with the work, as have many others who are connected with the industry. I am glad to say that the vast majority of these fully support the Order. At the same time I should like to pay tribute to the work of the Council under the chairmanship of Mr. Roger Falk, and of the Research Association under Mr. Keith Wrighton. Both bodies have done a first-class job in helping the furniture industry to strengthen its position in home and overseas markets. By your Lordships approving this amendment Order, it will enable them to make a still greater contribution in the future, and therefore I hope that your Lordships will do so. I beg to move.

Moved, That the Draft Furniture Industry Development Council (Amendment No. 3) Order 1967 laid before the House on 5th July, 1967, be approved.—(Lord Walston.)

9.18 p.m.

LORD DRUMALBYN

My Lords, I should like to thank the noble Lord for his expounding of this Order, although I am bound to say that generally votes of thanks come at the end of proceedings rather than at the end of the first opening shots. I have no criticism to make of this Order, except so far as two things are concerned: first of all, paragraph 3 of the Schedule, which deals with the definition of furniture; and secondly, the degree of consultation that has taken place.

As the noble Lord said, the President of the Board of Trade eventually decided last year to bring built-in furniture within the scope of the levy for the Furniture Development Council. This meant bringing in activities of an industry which was quite separate from the furniture industry, an industry which looks not to the Board of Trade but to the Ministry of Public Works and Buildings as its sponsoring Department. It is true that Section 14(2) of the principal Act, the Industrial Organisation and Development Act, permits this to be done. But if it is done, surely it should be done with the utmost tact and consideration, and with the fullest consultation. After all, one has to bear in mind that in this case the Board of Trade were dealing with a union and an organisation of employers that were not accustomed to dealing with them, but were accustomed to the ways of another Ministry. They had no previous experience of dealing with Development Council Orders, and they should have been guided, I think, and helped in every possible way; told exactly how long they were going to have for consultation; how long it would be before they must make up their minds; whether to ask for additional consultation, and so forth.

On this point of consultation, Section 1(4) provides that a development council order shall not be made unless the Board or Minister concerned is satisfied that the establishment of a Development Council for the industry is desired by a substantial number of the persons engaged in the industry. Technically, I dare say, it may be that the Board does not have to be satisfied that a substantial number of persons in the second industry brought within the scope of a Development Council Order, by an amended Order, desire to be brought in. Technically, no doubt, that is not necessary. But, all the same, it is relevant, I think, as the noble Lord himself said, that the joinery industry, which is the second industry, does not wish to be brought in; that the British Woodwork Manufacturers' Association consider that they are still awaiting consultation with the Board of Trade, and that they have not indicated any desire to be brought in—quite the reverse; and that, of the two trade unions involved, I am told that the Amalgamated Society of Woodworkers has informed the Board of Trade that it has no desire to be brought in, and the Amalgamated Society of Woodcutting Machinists has not been asked by the Board of Trade whether it has any desire to be brought in or not.

The Preamble to this Order states that the Board of Trade has complied with the subsection in this case dealing with consultation, which says that before making a development council order the Board or Minister concerned shall consult any organisation appearing to them or him to be representative of substantial numbers of persons carrying on business in the industry. Such organisations represent persons employed in the industry as appear to the Minister concerned to be appropriate. The Preamble states that the Board of Trade have complied with this subsection. My Lords, a Preamble has to be proved. Parliament has to be satisfied that consultation, in the normal sense of the word, has taken place, and not just what a Minister or Department may be pleased to call consultation. The Board of Trade wrote, on May 24, to the British Woodwork Manufacturers' Association, and said: I can assure you that as soon as we have the full draft of various proposed amendments to the Order, which includes an appropriate reference to built-in furniture, we shall be formally consulting with the B.W.M.A. as an interested organisation. An organisation which has not had to deal with a development council before, or, for that matter, very much with the Board of Trade, is not likely to know what the Board of Trade means by "formally" unless it is told. The B.W.M.A. asked to see the sponsoring Ministry, and a meeting was arranged for June 26. On June 9 the Board of Trade sent a copy of the draft Order, and offered to discuss it. To this the B.W.M.A. replied: I would anticipate that a further meeting would be required for this purpose, as suggested by you. That was the purpose of consultation.

At the meeting on June 26 the Board of Trade representative was present, and the Ministry Chairman summed up the three points on which the B.W.M.A. felt they required further information. On July 3 the Board of Trade wrote to the B.W.M.A., but they did not state that there was to be no further consultation before the Order was made; and there has been none, although the B.W.M.A. has made it quite clear that it expected it, and expected answers to these questions. The result is that now I think the Order is less satisfactory than it would have been if there had been full consultation. The B.W.M.A. are not satisfied with the definition of "furniture". The definition says: 'Furniture' means furniture made of any material, whether assembled or not, of a type commonly used for domestic purposes, whether or not designed, manufactured or supplied for those purposes, and whether designed to be free-standing or to be affixed to premises, and so on. The Board of Trade have simply informed the B.W.M.A. of all the various items that they consider will be included in the term "built-in furniture". They did that in the letter of July 3 to which I referred. Nobody knows whether that is a complete list or how this definition is going to be interpreted.

This is most unsatisfactory, and of course it is also unsatisfactory that the definition in itself makes a division in the joinery industry. The definition has the effect that what is exempt from the scope of the levy is: furniture designed to be affixed to premises and made (whether on the premises to which it is to be affixed or elsewhere) by any person— (i) pursuant to a contract entered into by him to supply and affix such funiture.… In other words, if the maker himself fixes the furniture it is exempt; if it is done by a contractor it is not exempt. So again there are two separate categories, one exempt and one not. This is quite unsatisfactory. I should have thought that with proper consultation this difficulty could have been ironed out, and it seems to me that the Minister would do well to withdraw this Order, to have the consultation and then reintroduce the Order. He still has quite a lot of time before the House rises for the Recess. If he would take that course, the consultation could be organised and it would give a great deal of satisfaction. People do not feel satisfied if they are brought in from quite outside the industry. The joinery industry is entirely separate from the furniture industry: it has a separate sponsoring department; it is separately treated for purchase tax purposes and for industrial training, and for those reasons it is absolutely imperative that it should be fully consulted. This has not happened. It could have happened, and in the circumstances I think we are entitled to ask that it should happen before we give our assent to this Order.

9.22 p.m.

LORD WALSTON

My Lords, I am sorry the noble Lord has taken this line, because I really feel that in preparing this Order we have done not only all that was statutorily required of us but also all that reason and common sense demanded. I would say at the outset that on pure grounds of what I would call "simple logic" and nothing else, and without going into any technicalitities, it is right that those who are concerned with furniture-making should pay the levy if they are going to get the benefit from the work of the Development Council.

As I tried to explain to your Lordships, over the past years those who are normally engaged in the joinery trade have become increasingly involved in the furniture trade. A larger amount of the built-in furniture specifically is now being manufactured by people who normally are joiners and woodworkers, but the results of the research and general work of the Furniture Development Council are, of course, available, either directly or, more probably, indirectly, to these people. Therefore it is only fair to the furniture industry as a whole, as defined in commonsense terms, that they should be brought into the scope of this Order.

I think this is the common-sense approach to this matter. What we want to avoid in this are any demarcation disputes—refusal either to do a certain job or to pay a certain levy, or whatever it may be, because of some technicality. We want to make this a common-sense working agreement which will benefit the furniture industry as a whole, and we want to ensure that those who benefit from it pay their fair share and that there is no one section that is left out on a technicality. I hope that I have carried noble Lords with me, at least as far as that.

The second point, which the noble Lord, Lord Drumalbyn, went into at considerable length, was whether we in fact made the appropriate consultations, and whether this has been done correctly. I think I am right in saying that he was good enough to say that we had fulfilled the legal requirements under which we were operating, and that of course is quite true. He then went on to suggest that it had not been done properly, but had been done in a somewhat formal and perhaps cavalier fashion. It is perfectly true that we consulted the Woodworkers Association in the formal sense on June 9.

But that was not by any means the beginning of the story, because long before that officials of my Department had been in close touch with the Woodworkers Association. For instance, on March 22 two officials of the Department paid a special visit to the Association's headquarters and explained the purpose of the Amendment Order; and subsequently on April 14 and May 24 two further letters were sent on the subject, the latter of which extended an invitation to discuss further if the Association desired. Then there was a meeting held under the auspices of the appropriate Ministry, that is, the Ministry of Public Building and Works, on June 26. I would go further than that and say that the sponsoring Government Department, that is, the Ministry of Public Building and Works, agrees with this Order and its scope, and, therefore, although the woodworkers themselves are opposed to it, the Government Department which has the overall responsibility in this matter and perhaps can look at it in a rather wider sense, does see the force of the arguments. Indeed, as I said in my opening remarks, we have consulted very fully with them and with other Government Departments and with all the interested parties.

I think it is true to say that no matter how much consultation we had it would have been probably impossible to reach a unanimous agreement. I submit that we have had not only the consultation demanded of us legally, but far more than that—and consultation of a sort designed to bring people round a table or sitting across desks, talking to each other. No matter how much of that we had had, there would always be the natural and understandable reluctance on the part of people who have hitherto not had to pay the levy being brought into the scheme. But we have—and again I repeat what I said earlier—made it perfectly clear, and in framing the Order we have attempted to achieve this. I believe we have achieved it, at any rate as to 99.9 per cent.—that is, that the levy will be paid only by those who actually make furniture, and it will not be extended to any other activities of joiners, woodworkers or anybody else. That, surely, must be the objective of this Order; it is what you make and what benefit you get rather than how you happen to be classified in special returns or any other way. I hope therefore the noble Lord, having listened to what I have said, will agree we have not only carried out our legal responsibilities as the Government but have gone much further, and that the Order itself is a good one and he will agree to it.

9.35 p.m.

LORD ERROLL OF HALE

My Lords, I should like to thank the noble Lord for replying so fully to my noble friend Lord Drumalbyn, but we on this side of the House still remain deeply dissatisfied with the situation although appreciating greatly the careful explanations given by the noble Lord, Lord Walston. The real reason for this Order is, of course, not just a matter of tidiness; it is that the revenue of the Furniture Development Council is falling away a little, and they have looked around and said, "We had better rope in a few more people. We have all these people who make built-in units"—which the noble Lord, Lord Walston, has been careful to call furniture; but it is not furniture at all. And so these people who do not want to be roped in, have been or are about to be roped in if this draft Order goes through.

It is quite true that consultation on this particular matter might continue indefinitely without the Government getting agreement. In my submission, in that case the Government ought to desist from forcing these people to pay the levy. Why should they pay a levy to a body they have not wanted to be associated with, and which is not likely to do them much good? I know why: it is so that the Furniture Development Council can get more money. That is the sole purpose of this exercise.

It is fascinating to see how, even in Government Departments, the line is so clearly drawn between movable furniture and built-in units, because movable furniture is sponsored by the Board of Trade but built-in units are sponsored by the Ministry of Public Building and Works. So even in Government Departments the two categories of manufacture are entirely different. The noble Lord, Lord Walston, has amply reinforced what my noble friend Lord Drumalbyn has been pointing out: that here we have two clearly defined, different types of manufacture; and the one that is to be roped in does not want to come in because it does not think that the Furniture Development Council will be of any use to it.

And why would the Furniture Development Council not be of any use to it? Because the Furniture Development Council work has been concerned with the research and design and development problems relating to movable furniture, not to built-in units. I do not know whether the noble Lord, Lord Walston, has been to the Furniture Development Council Research Centre in North London. It is a most interesting place. They do tests on how many times you can lean back in a dining room chair without breaking the back legs. This is not a laughing matter; it is a most serious matter. Some chairs put up with that maltreatment; others do not. How is it that some types of joints stand that sort of maltreatment? Research provides the answer. The result is that dining room chairs are now better than they were 15 years ago. Wardrobes: how much strengthening is required in a wardrobe if it is placed on an uneven floor so that it will not in fact distort and so jam the doors, preventing them from opening and shutting? These are matters of great importance, and have been studied by the Furniture Development Council. But they have nothing at all to do with built-in units, which are not subject to these problems.

The Government may say that it is about time that there was research into built-in units. But this is going on already. The Woodworkers' Association, or whatever it is called—I have not my papers with me to check the name—already have a substantial volume of research work going on under their own steam, and without having ever asked for a grant from the Government. Indeed, one of their main sources of complaint is that if only they had gone cap-in-hand to the Government and asked for a grant, the full extent of their existing research work would have been better known by the Ministry of Public Building and Works. But now, unless you ask for a Government hand-out you are told you are not doing anything. It is a real lesson for the rest of us in this country: Ask the Government for money, otherwise you will be ignored! This may be a small example to-night, but it serves to illustrate the trend of thinking on behalf of Her Majesty's Government, that if you do not ask for money you obviously cannot possibly be doing anything.

That is the case of the Woodworkers' Association. They do not want the helping hand from the Furniture Development Council, because they know it is not going to help them. They do not want to contribute and they do not see why they should be frog-marched into it by means of this draft Order. They are doing their own research work. They are not making furniture; they are making built-in units. The next time the noble Lord moves house he will soon see the difference between the furniture and built-in units, because the built-in units stay behind for the purchaser of his property. He can take only the movable furniture with him, and he will be glad if it has been built to Furniture Development Council specification, because then it will stand up to the rigours of the move. But the built-in stuff, for which entirely different research work is necessary, stays where it is.

May I conclude, on this small but important matter to the people concerned, by asking whether Her Majesty's Government could not on this occasion, just for once, concede that there may be a point of view other than their own? Could they not say, "Maybe we did not get it quite right. At least, let us have another look at it"? It is only a draft Order. It is not an Order which is subject to the Negative Resolution Procedure, an Order which has the force of law until it is defeated in Parliament. It is, as I say, only a draft submitted by Her Majesty's Government to both Houses of Parliament. It is not a good draft. I ask the noble Lord to withdraw it and to think again.

LORD WALSTON

My Lords, with the permission of the House—I may not speak without it. I do not know whether the House will give me permission to speak again, very briefly. The noble Lord shakes his head.

LORD ERROLL OF HALE

I do not think the noble Lord has to ask for permission.

LORD WALSTON

I have already spoken twice. I will not detain your Lordships for long. The noble Lord, Lord Erroll of Hale, has made an eloquent appeal asking us to take back this Order and admit that we have made a mistake, that we have not thought right, and so on. Let me put this matter in what I consider to be its right perspective. This is not a question of an arbitrary, remote Government Department making a decision in its ivory tower, and issuing an ex cathedrâ judgment. This Order is the result of long thought and long consultation between all sections of the furniture industry, looked at in a logical and wide-raging manner, and between all the Government Departments concerned. I am surprised that the noble Lords, Lord Drumalbyn and Lord Erroll of Hale, should take this extraordinary legalistic attitude that because something happens to fall into one pigeonhole it should be dealt with in one way, and because something falls into another pigeonhole it cannot be included and must go somewhere else. It is this sort of attitude which has up to now bedevilled so much of British industry.

We must have a far more comprehensive view of these matters, and not simply say that because something happens to have a nail hammered into a wall and cannot be moved, it is separate from something which can be picked up and put somewhere else. We must look at these matters in a wide way, so that all those concerned in making furniture in this case—or it might be ships or moving freight—all join together, and do not just say, "We are railwaymen and they are lorry drivers, so we can have nothing to do with them". This is the attitude which restricts and bedevils our affairs at present.

LORD DRUMALBYN

My Lords, would the noble Lord take the view that what we are doing is asking the Government to consult those who know about these matters before they make a decision?

LORD WALSTON

No; that is not what I consider you to be asking us to do, because that is what we have already done. It has been going on for months past. Having consulted all the interested parties, and having got almost all of them on our side, why should we—because of a small group who are now being asked to do something they have never done before and who do not want to change their habits—then go against the majority decision of all the expert people? No, my Lords, I cannot take back this Order, and I hope you will agree to it.

LORD ERROLL OF HALE

My Lords, before the noble Lord sits down—

A NOBLE LORD: No.

LORD ERROLL OF HALE

Well, the noble Lord, Lord Walston, has spoken three times. May I not make a brief intervention? I would submit to the noble Lord, Lord Walston, that he has not made the slightest suggestion in his three speeches that any research work is going to be done which will benefit the people who have to pay the levy. It is time it was realised that we should not have to pay for things when we get no benefit from them. The woodworkers feel that they will have to pay a levy for something from which they get no return. Perhaps the noble Lord might think over that point.

LORD WALSTON

I will remind the noble Lord that if he will read what I have said he will see that I did say that they would get a return for this.

LORD ERROLL OF HALE

But it is not specified.

On Question, Motion agreed to.