§ 37. Mr. HIGHAMasked the Prime Minister if, in view of the fact that the Government propose raising the telephone tariff, he will consider the advisability of appointing a committee of business men to investigate the present cost of operating the telephone in order that the telephone rates shall not be increased unless it is demonstrated beyond question that such an increase is essential for the efficient conducting of the telephone service and, in particular, to find out if the number of telephone users could be decidedly increased and, as a result, the present loss of the telephone be turned into a profit; whether he is aware of the fact that during the period in which the United States Government controlled the telephone the efficiency of the telephone service diminished to an extraordinary degree, and since the American telephone system has been returned to its private owners it has steadily increased in efficiency and profit; and, in view of this fact, will he consider the desirability of the appointment of the business committee, as indicated in the early part of this question, which might be able to recommend to the Government the taking out of Government control of the telephone service in order that its efficiency might be brought up to the highest possible standard.
§ Mr. HIGHAMBefore the right hon. Gentleman replies, may I ask that my question should be answered by the Prime Minister? I do not want explanations from the Department concerned. I want to know the policy of the Government.
§ Mr. SPEAKERThe question applies to the Post Office.
§ Mr. HIGHAMBut the Department will only justify its faults. I want to know what the Government thinks.
§ Mr. SPEAKERThe question would be referred to the Post Office for information. The Prime Minister does not "run the whole show."
§ Mr. HIGHAMBut is it not possible for the Prime Minister to answer this question?
§ Mr. PIKE PEASEI understand that the control exercised by the United States Government was financial, and that the management and administration of the service was left entirely in the hands of the companies who were previously responsible for it. The assumption of control by the Government can, therefore, have had no effect on the efficiency of the service.
The labour costs in the telephone service have approximately doubled since 1914 owing to the increasing war bonus. The rise in the price of material and in contractors' charges has been even greater. An increase in the charges, as in the case of every other commercial undertaking, is necessary if the service is to pay its way.
As previously stated, it is proposed to submit a scheme for an increase in the telephone rates to a Select Committee, but it is not thought to be necessary or desirable that the Committee's reference should be extended to include the question of re-transferring the service to a private company, even if that step were practicable.
§ Sir R. COOPERIn view of the serious nature of our national finances, would it not be wise first to allow this question to be fully considered by a body of the best business men, together with Government experts, before deciding on retaining the telephones?
§ Mr. PEASEMy answer is the considered opinion. This Committee has been appointed entirely in view of the case to which I have referred.
§ Mr. HIGHAMCan the right hon. Gentleman give the names of the Committee and their qualifications?
Lieut.-Colonel MURRAYIs not the language of many Americans about their telephone service much stronger than any used with regard to ours?
§ Mr. PEASEWith regard to the American telephone Service, there are parts of the United States where the telephone service is almost perfect at present. As far as New York is concerned it is inferior to ours at present.
§ Mr. MACQUISTENIs the hon. Gentleman not aware that the cause of the falling short of the American telephone service is that whenever it was put under Government control the officials of the service immediately became Government officials, and therefore suffered from the deadening effect which all enterprise suffers from under Government control?
§ Mr. PEASEOn the day on which I answered the previous question, my hon. Friend who asked a supplementary, sent a letter to the Controller of the telephone service in London, saying the United States service, as far as New York was concerned, was inferior to ours. The Controller of the London service is the same man who was responsible for the service in 1913, when it is supposed to have been much more efficient than it is at present.
§ Sir H. BRITTAINIf it is merely a question of finance, how does the hon. Gentleman contest the idea that the New York telephone service, which was certainly the best in the world four years ago, is now inferior to London? I am the man who sent the letter.