HC Deb 10 May 1881 vol 261 cc156-71

moved the following new Standing Order:—

(Local Authorities to have a locus standi against Gas and Water Bills.)

"That the municipal or other local authority of any town or district alleging in their Petition that such town or district may be injuriously affected by the provisions of any Bill relating to the lighting or water supply thereof, or the raising of capital for any such purpose, shall be entitled to be heard against such Bill."

The hon. Gentleman said, that anyone who undertook to propose any alteration in the Rules and Orders of the House, and still more anyone who ventured to invade the sacred precincts of the Court of Referees, incurred considerable responsibility. He possessed, however, some knowledge of the practice before Committees upstairs, and the Board of Trade with respect to Provisional Orders. In the first place, he must be allowed to say that although, undoubtedly, the object of his proposal was to overrule the Court of Referees, he did not intend any act of discourtesy towards that body, who rendered great anti important services to the House. But the House would recollect that when any particular practice was objected to, and any wish expressed to alter a precedent established by the Court of Referees, the only way in which a re-consideration of the practice or precedent could be secured was by bringing the question regularly before the House, and proposing an alteration of the Standing Orders or a new Standing Order altogether. The proposal which he was about to lay before the House had no reference to any particular case, or to any particular place. He desired only to discuss the matter as one of the general principles which ought to govern the relations between the local authorities and the Gas and Water Companies of their particular districts. As it stood at present, the Rule practically laid down by the Court of Referees in that House was that when a Gas and Water Company went to that House for the purpose of asking for additional capital, leave to oppose that proposal was not given by the Court of Referees to the local authorities. The object of this new Standing Order was to provide that when a Gas or Water Company came before Parliament, the local authority of the district should be entitled to be heard generally against such Gas or Water Company. Notice of an Amendment had been given by his hon. Friend the Member for East Kent (Mr. Pemberton), who was himself a member of the Court of Referees, and the object of the Amendment was to limit very much the proposal which he (Mr. Stanhope) made. His hon. Friend wished to lay down by the Amendment that the opposition was to be limited to any matter contained in or proposed to be enacted by the Bill. In his (Mr. Stanhope's) opinion, that would be far too limited a proposal. The practice which he desired to establish in that House was exactly the same practice as that which now existed at the Board of Trade in regard to applications for Provisional Orders. And it was the same practice as that which now existed in regard to Private Bills in the House of Lords. He thought that the local authority ought to have power to appear in the case of any application by a Gas or Water Company for an increase of capital. The Gas or Water Company possessed a monopoly practically limited in duration by the amount of its capital; and what was suggested by the Standing Order he now desired to propose was that whenever the Gas or Water Company desired to extend its capital and came to Parliament to ask leave for that purpose, Parliament ought to have the power of reviewing generally all the circumstances of the proposal, and of imposing any fresh conditions which the circumstances of the case might seem to require. In the first place, he thought that this was the manifest intention of Parliament. If not, why did not Parliament, when it first established Gas and Water Companies, give them an easy power by some simple process of acquiring the additional capital which might be necessary for the future development of their undertaking. Parliament decided that it would grant capital to a limited extent only, and that every subsequent application for additional capital must be made to Parliament itself, so that Parliament might have an opportunity of reviewing altogether the terms of the concession. If that were the intention of Parliament, surely it followed as the logical sequence that Parliament intended that the local authority who best represented the interests of the consumers of the particular district should have a locus standi before a Committee of the House, and should have an opportunity of calling the attention of the House to the manner in which the monopoly had been exercised, and of explaining whether there were any reasons why a further extension of capital should not be granted, or to suggest the terms on which it should be granted. It was now the constant practice of the local authorities to purchase these undertakings; and in consequence of the existence of that practice, and of the fact that Parliament usually gave its assent to it, it became more necessary to entrust the local authorities with the power of guarding against the unnecessary increase of capital on the part of these Companies. No doubt, in these days there was some safeguard by the introduction of "the auction" clauses; but perhaps he might be allowed to represent to the House that these clauses did not apply at all to Water Companies; and that, over and beyond anything covered by these clauses, there were many other points which had been developed by experience year by year, which showed that those who represented a particular district should be empowered to go before a Committee of the House of Commons. They were told that the passing of this new Standing Order would have the effect of increasing litigation. He could not see why that supposition should be entertained. The adoption of the same principle had not led to any undue litigation in the case of Provisional Orders, or in the case of Committees in the House of Lords. Then why should it be supposed that it would be likely to lead to litigation in this instance? There were one or two safeguards against undue litigation already in existence. First of all, the House would remember that a statutory power was given to every Committee of that House in any case where they considered the opposition to have been frivolous and vexatious, to inflict the costs upon the opposing parties. That power had already been exercised in not a few cases, and must have had the best possible influence upon local authorities in inducing them to abstain from opposing a Bill where their opposition would not be justified. In the second place, the operation of the Borough Funds Act of 1867 had also operated as a salutary check. That Act would be perfectly familiar to the House. Under its provisions it was absolutely necessary before any local authority could oppose a Gas or Water Bill, that it should obtain the sanction of a majority of the ratepayers at a meeting specially called for that purpose. He did not think that at this moment it was necessary to add anything to what he had now stated; but he would simply submit his proposal for the discussion of the House. He felt that the best mode, after all, of protecting the interests of the ratepayers, was to strengthen the hands of the local authorities. He believed, also, that this popular House of Parliament would not refuse to the local authorities the power which day after day, without jealousy and without inconvenience, was given by the House of Lords.

Motion made, and Question proposed, That the municipal or other local authority of any town or district alleging in their Petition that such town or district may be injuriously affected by the provisions of any Bill relating to the lighting or water supply thereof, or the raising of capital for any such purpose, shall be entitled to be heard against such Bill."—(Mr. E. Stanhope.)


moved, as an Amendment, in line 4, after the word "against," to insert the words "any matter contained in, or proposed to be enacted by." The hon. Member said, that in rising to propose the Amendment which stood in his name, he hoped the House would allow him very shortly to state, in order to explain the nature of the Amendment, what the practice in the Court of Referees was, how it had arisen, and how it was regulated. He thought that his hon. Friend had not described the course of the practice of the Court of Referees quite accurately, and he hoped that he should be able to set him right in one or two points. The Standing Order under which the Court at present acted was the one numbered 134, which said— It shall be competent for the Referees on Private Bills to admit the petitioner, being the municipal or other authority having the local management of the Metropolis, or of any town, or the inhabitants of any town or district alleged to be injuriously affected by a Bill, to be heard against such Bill if they shall think fit. Under that Order the House would see that the power given to the Referees was optional. They might, as they thought fit or not, allow the local authority of any town or district alleged to be injuriously affected to be heard against the Bill. And he might say this—that in every case that had been before the Court, wherever any alteration was sought to be made, either in the quantity or the quality of the gas or water supply, or in the extension or diminution of the limits of the district, or in the price of the gas or water supplied, the Petitioners in every case had been admitted. They had gone further than that. They even admitted them in a case where the place of testing the gas was simply altered—where it was shifted from one place to another. They had considered that even so trifling an alteration formed a sufficient ground for their admission. The only cases in which they had ever been refused a locus standi were cases where it was simply sought to raise additional capital, and upon that point he must entirely differ from his hon. Friend who had moved this new Standing Order. Where new capital was sought to be raised it did not in any way increase or extend the monopoly, but it simply gave additional facilities to the Companies for the purpose of carrying out purposes which the Legislature had previously sanctioned and authorized. Of course, the Court of Referees were only anxious to carry out the Orders of the House, and it would relieve them, to a great extent, from very laborious duties if this Standing Order was carried. The House would observe that his Amendment did not in any way oppose the principle—as he understood the principle—of his hon. Friend's Motion. His hon. Friend wished, in cases where additional capital was to be raised, that, as a matter of course, the Local Government Boards should be admitted. His (Mr. Pemberton's) Amendment did not deal with that in any way. He thought that a great deal might be said against that proposition. It might give rise to a great deal of increased expense and of unnecessary litigation; and in reference to the statement of his hon. Friend that the Local Government Boards were checked by the operation of the Borough Funds Act, he might point out to his hon. Friend that that was not so in practice, because, although the Local Government Board could not charge the rates without the previous consent of the inhabitants, yet they constantly in practice did it, and took their chance of getting it confirmed afterwards. On these occasions opposition was raised in many instances unnecessarily, and he thought with very great disadvantage and discouragement to people who had invested their money in undertakings which had already been sanctioned by the House. His hon. Friend had referred to the practice of the House of Lords and of the Board of Trade; but in neither of those cases could he draw a single argument in favour of his Resolution. The practice was entirely different, and could not be compared in any way to that of the House of Commons. In the House of Lords the same Committee decided on the merits of a Bill, and also the question whether the Petitioners should have a right to be heard or not. It was therefore as a matter of course that they were permitted to be heard in every case, because the Committee which decided the question of merits also settled the question of locus standi. With regard to the practice of the Board of Trade, the rule is this—Whenever a measure is proposed, an officer of the Board was sent down to the country, and he admitted everybody to state their objections as a matter of course. He did not think that his hon. Friend proposed that everybody, as a matter of course, should be allowed to petition against a Bill in that House. All he (Mr. Pemberton) proposed to do was to carry out what he believed to be already the Standing Order, and certainly the intention of the House. The object of his Amendment was simply to restrict the Petitioners to those points which were raised by the Petition and by the Bill. There was already a Standing Order, No. 128, which he was convinced had that object in view. It was in these terms— No Petition against a Private Bill, or Bill to confirm any Provisional Order or Provisional Certificate, shall be taken into consideration by the Committee on such Bill which shall not distinctly specify the ground on which the Petitioner objects to any of the provisions thereof; and the Petitioner shall be only heard on such grounds so stated; and if it shall appear to the said Committee that such grounds are not specified with sufficient accuracy, the Committee may direct that there be given in that Committee a more specific statement in writing, but limited to such grounds of objection so inaccurately specified. He thought that on reading that through for the first time the impression on the House would most certainly be that it was intended that in no case of any Private Bill should the Petitioners be entitled to be heard, except on grounds of objection to the Bill stated in their Petition. But in practice it had been held that these words did not go far enough; that although, as far as any objection taken to a provision of the Bill there must be a distinct ground of such objection stated in the Petition, yet it did not in terms say that in a case where something was raised in the Petition which was not raised by the Bill, the Petitioner should not be heard on any such statement. He thought nobody could read that Standing Order without being convinced that that was the intention of the framers of the Order and of the House in passing it. All that his Amendment did was in the way of general application; but, of course, as the proposed new Standing Order applied only to Gas and Water Bills, it would at present apply only to Gas and Water Bills, although he thought it was one which should be of general application, and which, he believed, only carried out the existing Order No. 128. In this case, he thought it would not in any way interfere with his hon. Friend's proposal. It would in no way prevent a Petitioner from stating any objection to a Bill, and it would not, prevent them from being heard as to their objection. It would only prevent, in the first case, a Petitioner raising something for the first time of objection which was in no way contemplated by the Bill, and which was really not one of the issues between the parties. He thought he might give an illustration of a practice which he thought very objectionable, and which he thought the Amendment would remedy. During the present Session the South Eastern Railway Company—a Company with which he had no connection whatever—brought in a Bill simply to enable them to purchase an existing railway of a few miles in length, made by a private Company. In the way of objections, there were allegations raised by the Petitioners against the Bill that the fares charged by the Railway Company, not on the particular line they were about to purchase, but on an entirely different part of their system, were too high, and they asked the Committee appointed simply to inquire into a question whether one Railway Company might sell to another Railway Company their existing undertaking, to go into the whole question of rates and tolls charged by the purchasing Company in an entirely different district. There was a Committee now sitting on the general question of railway rates which might be a fitting tribunal to enter into such matters; but he did not think that on a Bill which in no way raised issues of that sort, the Petitioners should be allowed to spring a mine upon a Railway Company and propose to undo that which the Legislature only a few years before had carefully inquired into and sanctioned. With these few observations he would move the Amendment of which he had given Notice.


seconded the Amendment. He thought that a new Standing Order was hardly necessary at all; and it appeared to him that, to some extent, it cast reflections upon the Court of Referees and their action in the past. But even if the House considered that a new Standing Order was to some entent necessary, he was quite sure it was only fair that it should be qualified in the manner proposed by the Amendment. His hon. Friend below (Mr. E. Stanhope) had stated with regard to Gas and Water Companies that they had a monopoly; but he forgot to state that that monopoly was a restricted one, and that it was accompanied by compulsory provisions requiring them to carry out the business they undertook, and to supply the public with the article water or gas they were empowered to produce or distribute. Therefore, under these circumstances, there was no inducement on the part of a Company to come to Par- liament for fresh capital, because since the adoption of the auction clauses and the sliding scale initiated by Mr. Forster's Committee some years ago, it was absolutely of no advantage whatever to a Company to increase their capital. If this Standing Order passed in the words proposed by his hon. Friend, a direct encouragement would be given to the local authorities to interpose with roving Petitions in every case where a Company asked for new capital, and they would be induced to go behind the Bill and raise questions that long ago had been settled on general principles by Committees of that House. The adoption of the Standing Order would also have another effect that would be very unfair to a Company and very undesirable, for it would enable a Corporation who had an intention of acquiring the business of a Company first to attack them in Parliament when they applied for power to raise new capital, and then, having reduced the value of the undertaking by attacking it in Parliament, they might be able to purchase it more cheaply. The Company was bound to supply gas or water, and was bound to come to Parliament, as their district extended, for further powers; and it was certainly not in accordance with his ideas of fairness that in endeavouring to fulfil a responsibility forced upon them by Parliament they should be subjected to the cost and injury which the adoption of this new Standing Order would throw upon them. As he knew there were other Members of the House who wished to speak upon the subject, he would content himself with having stated the views of the Companies and with having seconded the Amendment.

Amendment proposed, In line 4, after the word "against," to insert the words "any matter contained in or proposed to be enacted by."—(Mr. Pemberton.)

Question proposed, "That those words be there inserted."


expressed a hope that the House would agree to the Motion of the hon. Member for Mid Lincoln (Mr. E. Stanhope). He could assure the House that under the present Standing Orders considerable difficulties were placed in the way of Municipal Corporations and other local authorities in opposing Bills of this nature. In a town with which he was connected—Sheffield—these difficulties had been felt only this very year. A Bill had been introduced into Parliament to increase the capital of the Water Company there; but the Corporation had been unable to have their objections to the Bill explained to a Committee, although very considerable differences existed between the inhabitants and the Water Company, and a very large sum of money had been expended in obtaining a legal decision in reference to those difficulties, and the Water Company were requested to have the matter definitely settled by a clause being introduced into their Bill before the present Session of Parliament, but which they declined to comply with, and the Corporation had no locus standi, the Bill being promoted only for the raising of additional capital.


hoped he might be allowed to say a word in favour of the Amendment of his hon. Friend the Member for East Kent (Mr. Pemberton). The original proposition for a new Standing Order might very well, he thought, be negatived. It was proposed that there should be an alteration of the existing Standing Orders, and that the local authorities should have power to oppose all applications by Gas and Water Companies for obtaining additional capital. The question then arose as to the extent to which this power of petitioning should be limited, and he fully endorsed all that had been said by his hon. Friend the Member for East Kent. The new Order proposed by the hon. Member for Mid Lincoln was not drawn, in his opinion, with sufficient care. It would allow the local authorities on presenting a Petition to go into a great variety of extraneous questions. He was quite sure he should have the assent of the Chairman of Ways and Means when he said that it would be much better to keep the parties, when they went before a Committee, to the absolute issue that was raised by the Bill. Let them come in and have full opportunity of being heard on the matters proposed by the Bill; but do not allow them to enter widely into questions which had nothing whatever to do with the Bill. The least the House could do, if they adopted the proposed Standing Order at all, would be to adopt it with the Amendment moved by the hon. Member for East Kent.


The question which has been raised by the hon. Member for Mid Lincoln is one which, on the one hand, is largely interesting to the directors and shareholders of Gas and Water Companies, but which, on the other hand, interests most directly the various local authorities throughout the country who think they are prejudiced by the present practice, which prevents them from appearing to oppose these Companies when they come to ask Parliament for power to raise additional capital. As representing the Board of Trade, I have given the most careful consideration to the matter, and I have come to the conclusion that the proposal of the hon. Member for Mid Lincoln is one that the House would do well to adopt. In saying that I beg to observe that I do not conceive that I am in the slightest degree casting any imputation upon the action of the Referees. This action, however, appears to have become much more stringent in the last few years than it formerly was. I received a letter this morning from Mr. William Livesey, the Secretary of the Gas and Water Companies' Association, and in that letter he says— I have been engaged in Parliamentary matters more than 30 years, and as Secretary to this Association more than 12 years; and, so far as my knowledge extends, the rule has always been that when a Company applies for power to raise additional capital the local authority is entitled to inquire into all its powers. It is only recently that the Standing Orders Committee have refused this privilege universally to the local authorities. Mr. Livesey goes on to say— Although this latter part has not always been adhered to, I believe that, notwithstanding the recent decisions on the question of locus standi, this is the general understanding of the Provincial Companies at the present time, and that there is no desire on their part to alter it. If, however, the decisions are upheld, the Companies will, of course, take every opportunity of turning them to account. I agree with the hon. Member for Mid Lincoln that there are no grounds why this House should not agree to the practice already adopted by the House of Lords and by the Board of Trade in the case of applications for Provisional Orders. The hon. Member for East Kent (Mr. Pemberton) says the two cases are not analogous. To that I assent; but, at the same time, I must be allowed to say that the result of the practice in the House of Lords is that the local authorities have there this power of opposing which is denied to them under the interpretation of the Standing Orders of the House of Commons. I regret that I cannot see my way to the acceptance of the Amendment which has been proposed by the hon. Member for East Kent. That Amendment would have the effect of limiting the proposal of the hon. Member for Mid Lincoln, and would make it practically of no effect at all. Mr. Livesey, in his letter, points this out very clearly. He says— If a Company exhausts its capital or uses all its land it is obliged to come to Parliament for further powers; but it is hardly possible to conceive a case in which a Company would be obliged to come to Parliament for an alteration of the price they are charging or the illuminating power of the gas they are supplying; and under the proposed Amendment, so long as these points were carefully excluded from the Bill, the public would not be entitled to inquire into them.


begged the right hon. Gentleman's pardon. The effect of his Amendment would be to allow the local authorities to be heard on everything relating to the proposed additional capital.


Precisely; but they would not be entitled, on the proposal of a Company to double its capital, to raise any question as to the quality of the water or gas supplied or the price charged. That is, I think, a most important matter. At the present time the great majority of the Gas Companies are not under the sliding scale system. The first thing to be done in connection with the sliding scale system is to fix the initial price, and in that question the local authorities have the greatest possible interest as representing the communities. And yet, under the Standing Orders, with this Amendment of the hon. Member for East Kent, the local authorities would not be entitled to appear. The only objection of any force which has been taken to the proposal of the hon. Member for Mid Lincoln is that it would have the effect of seriously increasing the cost of Private Bill legislation. I do not deny that there is some force in that objection; but I would sub- mit to the House that if this litigation is expensive, that is a reason for altering the process of litigation and for endeavouring to substitute another and less expensive mode, but is no reason for shutting the door against those who desire to be heard against the proposals of a Private Bill. Under these circumstances, I hope the House will reject the Amendment of the hon. Member for East Kent and accept the proposal of the hon. Member for Mid Lincoln.

MR. LYON PLAYFAIR (who was very indistinctly heard)

I am sorry to disagree with my right hon. Friend the President of the Board of Trade with regard to the Amendment which has been submitted by the hon. Member for East Kent, and I shall certainly feel it my duty on this occasion to vote for that Amendment. I entirely agree with the proposition that the local authorities should have a locus standi to be heard against every Bill which affects the interests of the locality they represent. The only difference between the Motion and the Amendment is that the latter limits this right to the subject-matter of the Bill, and does not open up past issues settled formerly by often protracted and expensive contests. Recent legislation in regard to Private Bills has kept in view the necessity of diminishing, as far as possible, the expense of promoting Private Bills, whether it be incurred by a Municipality or by a private Company. I think that the effect of the proposal of the hon. Member for Mid Lincoln would be to bring every Private Bill affecting a Municipality before a Committee upstairs, and would enable the local authorities to rake up every question that may have been decided by previous legislation, and might consequently increase enormously the cost of promoting a Private Bill. Let me give an instance in order to show how seriously the adoption of the proposal now submitted to the House may affect the public interests in a particular locality. Suppose that a Company desires to obtain facilities for the supply of water or gas to the suburbs of a town, and for that purpose asks for power to raise additional capital. If the local authorities have the right of opposing them in regard to the powers they already possess, the Company will naturally be afraid of coming to Parliament on account of the excessive expense they might incur. They will therefore refrain from petitioning for a Bill and asking for additional capital, and the suburbs in question would be deprived of the benefit they would derive from the extension of the supply of gas or water. The mere extension of works, for which Parliamentary authority is required, might be made the ground for a renewed contest all along the line. I think, therefore, that it would be inexpedient to give the local authorities, on a question of raising additional capital, a locus standi in matters relating to the quality of the water or the supply of water, or to the quality of the gas or the supply of gas, when these questions have once been decided. I do not think it would be right, in such a case, to allow the local authorities to rake up every question that has been previously decided, for this would inflict great expense not only upon the private Company promoting the Bill, but upon the Municipality itself, and it must be borne in mind that this double expense ultimately falls on the consumer. I see nothing, however, but advantage in asking for a locus standi on the subject-matter of the Bill. For these reasons, I am prepared to support the Amendment moved by the hon. Member for East Kent.


was anxious to say a few words upon the question before the division took place. He had had a considerable amount of practical experience, and he certainly agreed to the principle of the proposition made by the hon. Member for Mid Lincoln. He also agreed with his right hon. Friend opposite (Mr. Lyon Playfair) as to the danger of allowing the municipal authorities to be heard in opposition upon points that had no connection with the subject-matter of the Bill. The state of things in regard to Water Companies and the municipal authorities was very different from what it was a few years ago. The relations with these Companies now with the public were of such a description that it was necessary that Gas and Water Companies should be opposed when they went to Parliament for the purpose of increasing their capital, because that increase of capital involved a great many considerations, which might be fairly raised before a Committee. He should be the last person to say a word in disparagement of the Referees, who had rendered such great service to Private Bill Committees by lessening time and expense; but while he recognized the principle of the Standing Order proposed by his hon. Friend the Member for Mid Lincoln he should certainly vote for the Amendment.


admitted the long experience which his hon. and learned Friend the Member for Cambridgeshire (Mr. Rodwell) possessed; but he begged to say at once that, as far as his judgment went, he should support the original Motion of his hon. Friend the Member for Mid Lincoln, for the considerations which had been so well put by the right hon. Gentleman the President of the Board of Trade. The Motion of the hon. Member for Mid Lincoln was not intended as a reflection upon the Court of Referees, but to assimilate the practice of that House with that of the House of Lords and of the Board of Trade. He hoped his hon. Friend the Member for East Kent (Mr. Pemberton) would not put the House to the trouble of a division.


entertained a strong feeling in favour of the Motion which had been made by the hon. Member for Mid Lincoln (Mr. E. Stanhope), and was quite satisfied that the Municipalities, as a body, would be much indebted to the right hon. Gentleman the President of the Board of Trade for giving his support to the Resolution. He was sure he was expressing the feeling of everyone who had anything to do with municipal government when he said that they always felt a great difficulty in opposing any provisions submitted in a Private Bill by Gas and Water Companies. Representing, as they did, the localities, and bearing in mind the interests that were at stake when measures of this kind were promoted, they felt that they should always be allowed the opportunity of going before Parliament whenever such Bills were submitted.

Question put.

The House divided:—Ayes 65; Noes 311: Majority 255.—(Div. List, No. 200.)

Main Question put, and agreed to. Ordered, That the municipal or other local authority of any town or district alleging in their Petition that such town or district may be injuriously affected by the provisions of any Bill relating to the lighting or water supply thereof, or the raising of capital for any such purpose, shall be entitled to be heard against such Bill.

Ordered, That the said Standing Order (Local Authorities to have a locus standi against Gas and Water Bills) be a Standing Order of this House.