50. Mr. MacCALLUM SCOTTasked the Secretary to the Treasury whether he is aware of the terms of the maintenance contracts made by the Board of Works with contractors in Glasgow, whereby the contractor is to supply labour on day-work in consideration of a payment by the Commissioners of His Majesty's Works and Public Buildings of the amount actually paid in wages to the men with an addition of 6¼ per cent. in respect of services and expenses; whether, in the case of one contractor in Glasgow, the wages amount roughly to £2,000 per year, so that the 6¼ per cent., out of which the contractor must pay workmen's compensation, third-party risk insurance, and the maintenance of the necessary scaffolding, tackle, tools, etc., amounts to about £125 per year; whether the insurance contribu- 906 tions which, under the Act, must be paid by the contractor, amount to a total of about £1 per week, or £50 per year, which wipes out the whole of the profit on the contract; on what ground has the Treasury refused to grant permission to the Board of Works to grant relief to the contractors by varying existing contracts or otherwise; and whether, in view of the fact that the contract has been specifically framed in order to relieve the contractor of any risk of a rise in wages or in the cost of labour, and that the Government has by the National Insurance Act materially varied the conditions with a special view to which the contract was framed, the Treasury will now sanction such a variation of the contract as in the opinion of the Board of Works the equities of the case may demand?
§ The FINANCIAL SECRETARY to the TREASURY (Mr. Montagu)The answer to the first part of the question is in the affirmative. I have not the data necessary for an answer to the second and third parts. The decision which has already been announced is based on the fact that the percentage fixed by the contract must be assumed to cover all expenses, and the risk of an increase in all expenses, save the payment of wages, and I am unable to depart from it.
Mr. MacCALLUM SCOTTAre we to understand then that the Treasury refuse to sanction a variation of this contract even if in the opinion of the Board of Works a variation is demanded by the equities of the case?
§ Mr. MONTAGUMy hon. Friend has no reason to assume that there is any difference of opinion between the Treasury and the Board of Works.
Mr. MacCALLUM SCOTTAre the Treasury, then willing to accept the opinion of the Board of Works on the equities of the case?
§ Mr. MONTAGUAny recommendation made from whatever Department it comes, will always be considered on its merits.
§ Mr. LYELLIs the award to which my hon. Friend alluded that which was mentioned by the hon. Member for St. George's-in-the-East (Mr. Bonn), namely, the case of Messrs. Leslie and Son?
§ Mr. MONTAGUI do not remember the particular award, but if the hon. Gentleman will put down a question I will inquire.
Mr. MacCALLUM SCOTTAre we to understand that the Government makes an agreement with a contractor that it will refund him the total cost of the wages, and also agrees to give him 6¼ of 6½ per cent. to cover profits; and if during the term of the contract it imposes additional burdens on the contractor, are we to understand that the Government is not to refund the insurance contributions?
§ Mr. MONTAGUThe 6½ per cent. was to include any risks except the wages which the contractor may have to meet. I do not regard this contribution as part of the cost of wages any more than a workmen's compensation.