HC Deb 11 November 1926 vol 199 cc1301-9

I beg to move, in page 17, line 37, at the end, to insert the words (4) Where under the Electricity (Supply) Acts, 1882 to 1922, or under any order made thereunder, or under any deed of transfer executed in pursuance of powers conferred by any such order, or under any special or local act, any right to purchase the whole or any part of the undertaking of any authorised undertakers being a company is vested in a local authority (including a joint electricity authority) the authorised undertakers may at any time within ten years before the date of purchase next occurring after the passing of this Act, or within ten years of any subsequent date of purchase enter into a contract with the local authority to amend, vary, or alter the terms of purchase on the next occurring date upon which they may purchase upon conditions to be agreed between the parties with the approval of the Electricity Commissioners, and the terms of such agreement shall he binding upon the parties. The object of my Amendment is to prevent local authorities and private undertakers in future, where agreements are about to be completed between them for an extension of time, being obliged to come to this House either for a Provisional Order or for an Act of Parliament. The House is familiar with the conditions under which these Orders have been given under the Act of 1888, and knows that the undertakers who got their Orders were subject to the condition that their undertakings were purchaseable after 42 years. It may be that when this Bill becomes an Act of Parliament it may be desired to bring about agreements of the kind suggested, for financial reasons, and to the advantage of electricity distribution, between local authorities and undertakers, in order to avoid the exercise of the right of purchase at what is called in the Act of 1888 their then value, on the determination of the period of 42 years. It may be that, in order to maintain the efficiency of a particular undertaking, the period should be extended somewhat beyond the limit of 42 years. Where local authorities and private undertakers come to an agreement with that object in view, they ought not to be obliged to incur all the expense and worry of coming to this House to ask for a Provisional Order or a private Act. I think my right hon. and learned Friend the Attorney-General will agree that it is not encumbering the Bill if we add this Amendment to it, and I hope he will be able to accept it.

Lieut.-Colonel Sir FREDERICK HALL

I beg to second the Amendment.

Anything we can do to reduce the expenses in connection with this Measure would naturally be acceptable to my hon. Friends in the Labour party, because I have heard, and rightly heard, them say so many times that in many cases there is an enormous waste of time and of money in bringing forward Bills and Provisional Orders. Therefore, I hope the Government will accept this Amendment.

The ATTORNEY-GENERAL (Sir Douglas Hogg)

This is an Amendment to which I have given rather careful attention, because it looks rather formidable in length, and I am anxious not to encumber the Bill, but it has seemed to me, after discussion, to be not an unreasonable Amendment, and I would like to tell the House why in a sentence or two. The House will see, in the first place, that it is purely permissive and does not confer any power on any authorised undertaker to obtain or insist on having any alteration in the terms of purchase. It only operates if the authorised undertaker and the local authority are both in agreement and arrive at terms which are agreeable to both. If they arrive at such terms the position is that the terms have to be ap- proved by the Electricity Commissioners, so that there is an independent body to see that nothing is done which is undesirable in the public interest. If the authorised undertakers, who are the sellers, and the local authority, who are the buyers, agree upon terms which they both think fair, and if the Electricity Commissioners are satisfied that those terms do not contain anything detrimental to the public interest, then I do not think there is any harm in allowing such an agreement to be made, with these safeguards, in order to avoid the great expense of a private Bill which has to go through both Houses of Parliament. On those grounds, on the whole, I shall advise the House to accept this Amendment.


I hope the House will not accept this Amendment, and I think an Amendment of this sort ought not to be introduced at this stage of the Bill, affecting, as it does, the purchasing rights and position of local authorities. It is all very well to say that it is only permissible, but what is the real intention behind the Amendment? The intention is that companies may take advantage of a fleeting majority of persons who are in their favour, or against municipal enterprise, on local authorities, and may hurriedly make terms for the extension of the period of their lease. I think that is entirely undesirable. This Amendment is not asked for by the local authorities, and it has not been discussed by them, but is now brought in at this late stage, and I think it is entirely improper to add such an Amendment to the Bill. The Bill as a whole does not deal with purchase prices, and the Amendment is hardly germane to the main purpose of the Bill. I could have understood it if there had been general provisions in the Bill dealing, with distribution, but there are not, and I see in this Amendment merely an endeavour by companies to obtain a longer tenure by taking advantage of some particular set of circumstances on some local authorities. I shall strongly oppose this Amendment, and I hope the House will reject it.


May I press the Attorney-General to answer these two points? How long is it since this matter was brought to his notice, and could it not have been brought before the Committee upstairs, so that it could have been discussed fully, rather than being sprung upon us now? Secondly, has he or his Department had any opportunity of consulting with the local authorities and municipalities in regard to this matter before he has advised the House to accept this Amendment?


I cannot understand hon. Members opposite opposing this Amendment, which, if I appreciate it correctly, as I think I do, is simply to give to a local authority or a company, where a right to purchase exists, the right that, if the local authority wishes to defer the purchase, but at the same time wishes to take advantage of the Statute to vary and improve the contract, it shall not be put to any expense in doing so. If the hon. Member for Limehouse (Mr. Attlee) could lay before the House any sufficient reason showing now any local authorities would be damnified in any particular by this proposal, I am sure the House would not agree to the Amendment, and I am quite sure that my right hon. and learned Friend the Attorney-General would not recommend it.


I am very surprised that the Attorney-General, who, I think I am right in saying, said yesterday that he was not prepared to make any more substantial Amendments to the Bill, should give way at the last moment on what I consider a very important point of principle. I remember the great struggle in Parliament in 1910 to get the right of local authorities, at any rate in London, to purchase the interests of companies in the London area, and I remember that there were many Committees appointed, and that as a result of their inquiries they came to the conclusion that after a certain period, in London, the London County Council should have this right.


This Amendment affects not the London County Council but provincial councils.


There is an old proverb which says: "Once bit, twice shy,' and we want to be very careful that the provinces do not suffer the same disabilities as does London. Local authorities are elected for a specific period, and the issues that cause the election of members vary from time to time. Very often the electricity issue does not loom large, but with the development of industry it may become a very vital question, and we do not want a local authority to fritter away its rights, without the approval of the House of Commons, to the prejudice of future local authorities. I remember very well the penalty that Marylebone had to pay for its lack of foresight in allowing a company to be set up in that district to supply electricity. The result was that Marylebone had to pay very heavily to buy out the company, and consequently, for some considerable period, the users of electricity in that district had to pay increased charges.

The House of Commons naturally takes a larger view of all these problems than can be expected to be taken by a locality that has many other interests to consider. I remember the great fights in this House over the Electricity Bills in which the hon. Member for Moseley (Mr. Hannon) has taken a very active part. Sometimes he has been successful in getting some concessions to companies; at other times, in spite of his persuasive eloquence, he has failed. Sometimes the House has rejected my views in favour of his, and sometimes the reverse. No doubt, on the whole, the House of Commons has been right, and I say the House should be very jealous in parting with this power, which, after a great deal of inquiry, was vested in the House of Commons. Even the Attorney-General has to admit he has not given the matter very lengthy consideration, and, certainly, the local authorities were not conscious until the eleventh hour that their rights were going to be stolen from them by an Amendment put on the Order Paper at a late stage.

In these circumstances, in a Bill not dealing with this problem, but with a much larger issue, it is a mistake to introduce an Amendment of this character. The Attorney-General resisted bringing in other electricity problems upstairs other than those relating to the supply of electricity, cheapening its generation, setting up the grid and the network. I would say, therefore, to the Minister that he should take off his Whip, and allow the House to have a free vote. I have supported this Bill right through in principle, and it would be very unfortunate, considering the support he has got from all sides, if he should now allow a new issue to be raised, and rush through the House an unfortunate principle, against all the traditions of Parliament, which has been very jealous to keep these powers in its hands.


May I suggest that this Amendment is distinctly in the interests of the consumer? When an undertaking is purchasable by a local authority, and there is uncertainty when that right will be exercised, or whether it will be exercised, the company is obliged to provide sums as a reserve. If they can come to an agreement with the local authority they know what their position is, and, consequently, the money which has otherwise to be put to reserve may be applied in reducing the price of current. If the matter has to be brought to this House, it is putting an obstacle in the way of agreement between the undertakers and the local authority, and in that way is preventing a reduction in the price of current to the consumer. I would, therefore, suggest to hon. Members opposite that, in the interests of the consumer, they should heartily support this Amendment.


I am very much alarmed by the enthusiasm of hon. Members opposite for this Amendment, and their newly-found interest in reducing legal costs, and by the fact that this is the third Amendment moved in this way by the hon. Member opposite. I should have thought that the right hon. Gentleman in charge of the Bill would have taken steps to have each of these new proposals carefully examined before even considering the question of adding them to the Bill. If the Minister satisfied himself on the point he could easily have made arrangements in another place to make any such Amendment. Manuscript Amendments and other Amendments are handed in without giving any time for their consideration, or to realise the consequences that will follow. My experience of local authorities in exercising their powers in this respect has been a painful one. In my own area the county council had the right to take over the trams but postponed their option, entered into a new agreement, and my constituents have actually got to pay 50 per cent. more in fares by this arrangement than they would have done if the county council had run the service themselves.

An Amendment of this kind has other great dangers to which I frankly object. I said yesterday that if a Tory majority had a large station in its control, it might be tempted to confer powers which should not be conferred. The civic enterprise of a successful local authority might be handed over for ever to a private company without the consent of Parliament. I do think, before such a great change in the law takes place, the House should have a, further opportunity to consider the matter. I would ask the Attorney-General further to consider this matter, and if he feels there are sound reasons for agreeing to the Amendment, there will be an opportunity to deal with it elsewhere. An hon. Member opposite was good enough to talk about a saving to the community, but the action of the power companies in London in distributing bonus shares make one very dubious about assenting to anything of this kind. I hope if the Attorney-General will not withdraw his assent to this Amendment, he will accede to the appeal of the last speaker but one, and take off the Whips, leaving the House a free choice on this very serious problem.


I find it very difficult to understand the anxiety expressed on the other side of the House with regard to this Amendment. Every speech which has come from hon. Members on the other side seems to me to have betrayed profound mistrust of the local authorities, in whose behalf they appear to be intervening in this Debate. As I understand this Amendment, it is a very simple proposal, that if there is an agreement between an existing company and the local authority, that agreement shall be facilitated by not requiring the approval of this House. That, as my hon. Friend the Member for Windsor (Mr. Somerville) has pointed out, is entirely in the interests of consumers of electricity. This Amendment, as I understand, puts no pressure on local authorities to assent to a proposed agreement. It merely enables them, if they are so minded, if they in their wisdom and prudence think it desirable, to come to an arrangement with the existing authorised undertakers to make that agreement without the intervention of this House. That, as I understand, is the simple purpose of this Amendment, and I do not understand the opposition from the other side.


I confess I am a little surprised at the outburst of opposition, which I certainly had not anticipated on this Amendment. It is perfectly true, as has been said by one hon. Member, that this Clause is not vital to the central feature of the Bill, the grid or inter-connection, which is the thing in which I am most interested. At the same time, I entirely fail to share that suspicion of local authorities which appears to animate some hon. Members opposite. They only like local authorities when they are of their own political complexion. I am afraid that is a narrow point of view. I had understood that the Amendment moved by my hon. Friend the Member for Moseley (Mr. Hannon) was an Amendment which the local authorities, equally with the authorised undertakers, desired, and I still do not see how it could do anything but good in the interest of the local authorities.

One hon. Member was good enough to refer to the case of St. Marylebone. In the case of St. Marylebone, if a power of this kind had existed, we should have been able to make a very much better bargain than we were ultimately able to make. At the same time, I am not anxious to force through, in a Bill which deals primarily with other matters, an Amendment which is not desired by both parties to it, and, in view of the suggestion which has been made, that some of those who are interested in this matter have not been adequately consulted, I propose to ask my hon. Friend, if he will, to withdraw the Amendment at this stage, so as to give a further opportunity for discussion with the local authorities. If he withdraws it, and if, after that discussion, I find my mind is unchanged, I do not undertake that I shall oppose this Amendment in another place, and then, of course, this House will have an opportunity of agreeing or disagreeing with the Amendment. I think that is a fair thing in face of the suggestion that not sufficient time has been given for its consideration.


With the permission of the House, I may say I have been personally impressed by the arguments from the hon. Gentleman opposite, that the local authorities did not have a full opportunity of examining for themselves the proposal in this Amendment, and I have no desire in the world to embarrass my right hon. Friend who, I quite understand, has not had, owing to the great pressure on his time, adequate opportunity to examine the Amendment. I am most anxious, in regard to any Amendment for which I am responsible, to consult the feelings of hon. Gentlemen opposite, as well as those on my own side, because I think it strengthens legislation if it can be passed with the concurrence of all parties. Therefore, on the understanding that my right hon. Friend will, after consultation with the local authorities, examine for himself at more length the merits of my Amendment before its introduction in another place; I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.


On a point of Order. May I ask whether it would facilitate matters if we could now know how many Amendments have been adopted with the approval of the other side of the House?