HC Deb 20 November 1928 vol 222 cc1648-61

Order for Second Reading read.

The MINISTER of TRANSPORT (Colonel Ashley)

I beg to move, "That the Bill be now read a Second time."

It will be within the recollection of the House that my right hon. Friend the Postmaster-General made a contract with Messrs. David MacBrayne in May of last year seeking for a period of five years to carry out certain services for transportation between the Western Highlands and Islands of Scotland, and giving a subsidy of £36,000 for that purpose. When my right hon. Friend the Secretary of State for Scotland brought this contract before the House according to the rules of Parliament, he unfortunately, and to his surprise, encountered a good deal of opposition and a good deal of criticism and eventually—I need not go over the whole of the Debate—it was referred to a Committee of this House for consideration and report. A few days after that was done, Messrs. MacBrayne, owing to the criticisms, I believe, which had been levelled at them—however, this does not very much matter at the moment—said they did not wish to go on with the contract, but that in order to avoid disorganisation of communications they would be prepared to continue on the same terms as they were working under until 31st October. They have been carrying on the service up to the 31st of last month.

Then the Select Committee found themselves in rather a difficult position. They issued statements to the Press that they would be prepared to consider any offers that were made to them for carrying on this service, and asked for tenders. Unfortunately no adequate response came. As time was getting on they then—I think very wisely—thought of approaching the great railway companies and some of the steamship companies, and they wrote to the London, Midland and Scottish Railway Company, to the London and North-Eastern Railway Company and to the Coast Lines and asking them if they could see their way to make some proposals. Eventually, after many negotiations, the London, Midland and Scottish Railway and the Coast Lines Company put up two alternative propositions to the Committee which were similar in most respects, but differed somewhat in their financial aspect. The Committee, having duly considered them, in their report stated: They do not feel competent to indicate a definite preference for either of these schemes. In fact, they left it to the Government to decide which of the two schemes which were very similar, should be adopted. One of these propositions which was I common to both schemes was that a new company should he formed to acquire the business. That company was formed last month under the title of David MacBrayne (1928) and they have under a temporary arrangement with the Government been carrying on the service since the 1st of this month. This company have done what the Committee said should he done, taken over the assets and goodwill of the old MacBrayne company. This company came into existence as I said some time last month. I think I ought to read to the House a paragraph which appeared on page 3 of the Report of the Select Committee stating the views of Sir Josiah Stamp as to the way in which legislation should be carried through, and that will explain why the Government are bringing in this Bill and why the Bill has not been brought in as a Private Bill. The Committee say: It became clear to your Committee quite early in this discussion that the London and North Eastern Railway Company would not be willing to enter into any form of joint undertaking in which they were not completely guaranteed against loss. Sir Josiah Stamp, on the other hand, while he made it clear that the London, Midland and Scottish Railway Company would not look on the undertaking as a promising or profitable commercial enterprise, but rather as one into which they would only enter on grounds of public necessity with considerable reluctance, stated on behalf of his Company that they would be willing to submit proposals for undertaking the steamship services in the West Highlands and Islands jointly with Coast Lines, Limited, upon one indispensable condition. This condition was that they should be relieved of all expense involved in any legislation neces- sary to give them requisite powers to invest money in a shipping company, of all need for diplomatic negotiations in securing the necessary passage of any Bill through Parliament, and of all responsibility in the defence of such a Bill against criticisms. Sir Josiah Stamp, both in his memoranda and in his evidence, repeatedly pointed out that, in assuming a service about which at present there was great criticism, he was exposing his Railway Company to opposition from a wholly new and probably fertile field to any Bill that they brought before Parliament for any purpose. His company, as he plainly said, would not proceed with any scheme which involved their promoting a private Bill, with all its attendant expenses and harassments, on their own account. He also said with considerable emphasis that no scheme would be satisfactory which did not as tar as possible combine the chief existing interests which serve the locality both on sea and land;— I think that that seems to be common sense. and both Sir Alfred Read and he made it clear that no new undertaking had any prospect of success which did not take over the whole stock, assets and goodwill of Messrs. MacBrayne"— which has been done. After a full discussion, and on the assumption that some way would he found by which the railway company or companies would be relieved by the Government of all expense and responsibility in promoting the necessary legislation, two schemes, on a certain basis common to both, were submitted jointly by Sir Josiah Stamp and Sir Alfred Read. That explains why, having accepted the recommendations of the Committee, and the Committee having adopted the scheme put forward by the London Midland and Scottish Railway and the Coast Lines jointly, it is the Government's work to promote the Bill and not that of a private company. The Bill itself—no doubt hon. Members have it before them—is a very short one. The operative Clause says: If there is incorporated, whether before or after the passing of this Act, a company having for its principal objects the provision of mail cargo and passenger services in the Western Highlands and Islands of Scotland"— That has been done; it was done last month and the acquisition of the assets of any company which prior to such incorporation provided such services"— Those have been acquired by the company it shall be lawful for the Minister of Transport, after consultation with the Secretary of State, by order, to authorise any railway company therein specified to hold shares, stock or debentures in or of any such company so incorporated to such amount as may be specified in the order, and on any such order being made, the railway company so authorised may, notwithstanding anything contained in any enactment, subscribe for, take and hold such shares, stock, or debentures to such amount as aforesaid, and may, with the assent of the Minister of Transport and of such company, provide in the Western Highlands and Islands of Scotland any such services as aforesaid, by sea, air or land. On that may I say that it is quite a new thing in a Bill of this sort for provision to he made for the railway company to provide air services subject to the assent of the Minister after consultation with the Secretary of State for Scotland and with the assent of the Company. I do not see why after the great advance in transportation which has now taken place we should not put in this so that we can eventually establish air services if they are commercially necessary and economic: and so the London Midland and Scottish Railway Company shall be able to provide that means of transportation for these people.

Mr. KIRKWOOD

Does that mean that these services are to be in the hands of this Company or in the hands of the Government?

Colonel ASHLEY

The railway company may with the assent of the Minister of Transport and of such company provide in the Western Highlands and Islands any such services as aforesaid by sea, air or land. This appears at the foot of the first page of the Bill, and there the hon. Member's point is answered. It would be convenient if I deal very briefly with the contract. The Secretary of State for Scotland will answer criticisms later.

Mr. JOHNSTON

Would it not be more convenient to dispose of this Bill first, and discuss the contract subsequently?

Mr. MACPHERSON

May I suggest that we should dispose of the Bill first? I think that would be much better in the interests of all concerned.

Colonel ASHLEY

I am prepared to fall in with the wishes of the House. I thought we might have dealt with the whole subject in one Debate, but if the sense of the House is the other way we are only too willing to meet their wishes. I do not think there is anything more to say on the Bill, except that the Government are carrying out the wishes of the Select Committee which was set up to deal with this matter.

Mr. KIRKWOOD

No.

Colonel ASHLEY

The hon. Member can criticise that statement, later. We are carrying out the suggestions of the Select Committee and I therefore submit the Bill, with confidence, to the House.

Mr. JOHNSTON

No hon. Member on this side of the House will desire to obstruct this Bill in any way. It is an essential part of the contract and a consequence of the contract. I therefore agree with the right hon. Member for Ross and Cromarty (Mr. Machpherson) that the whole business would be much more appropriately discussed upon the contract and upon the Amendments which have been handed in to certain portions of the contract. First of all, we should get the Bill out of the way. Therefore, on behalf of those who sit on this side of the House I heartily agree with this Bill and hope that it will have a speedy passage.

Mr. LIVINGSTONE

I have listened carefully to what has been said, and particularly to the conditions laid down by Sir Josiah Stamp. I want to make a few observations on the Bill itself, but I hope that nothing that I say will delay by one day the proposed improvement in transport in the Western Highlands and Islands of Scotland. In my view, the old company of David MacBrayne showed much public spirit in acting as they did in offering to carry on until we were able to make other arrangements. Equally, I think that Sir Josiah Stamp and his directors have shown great public spirit in undertaking what they have already undertaken. This Bill will enable the railway company to participate in the provision of mail, cargo and passenger services in the Western Highlands and Islands of Scotland. Two conditions are laid down, both of which are contained in the first paragraph of the Bill. These conditions are: If there is incorporated, whether before or after the passing of this Act, a company having for its principal objects the provision of mail cargo and passenger services in the Western Highlands and Islands of Scotland, and the acquisition of the assets of any company which prior to such incorporation provided such services … I take no exception to these two conditions in so far as this contract is concerned, but I want to look ahead 10 years, when this contract will come up for renewal. What will be the position then? If the service has been carried out efficiently, no harm will have been done, but it may be that the service will not have been carried out efficiently and many of those concerned may have been thoroughly dissatisfied with the service. What then? Let us imagine that another railway company, 10 years hence, by co-operation with another shipping company, desires to tender to the Government for this service. Perhaps I should make it quite clear now that there can be no successful competition against the subsidised service, but there may be competition for the subsidised service. Let us examine the position 10 years hence, when this question may arise. Two conditions have been laid down. The first one states that it must be the principal object of the company to provide these mail, cargo and passenger services. We can conceive of some big company 10 years hence who might undertake these services efficiently and effectively but whose principal object would not be these services. Are they ruled out? More important still, any would-be competitor must acquire, according to this Bill, the assets of any company which prior to such incorporation provided such services. Does that mean that there can be no successor to this new company unless that would-be successor is able to buy the assets of the existing company? Does it mean that the existing contractor can stand by and say: "Yes, but if you want to compete for this contract you must buy my assets"? I need not explain to this House the strong position of an unwilling seller. There is no basis here for purchase. Does it mean that the sitting contractor can charge any price he likes for his assets, knowing that he can have no competition until the other party buys his assets? I hope the Government will make some reply to this question, which is one of great importance. I do not think that can have been the intention of the Government. If they can satisfy me on that point, I will not force a Division; I would shrink from that, for I frankly admit that this Bill and the contract will give some improvement in the transport service, but I think the Government ought to consider what may happen 10 years hence.

Sir BASIL PETO

I should like to raise one point which has been already alluded to by the hon. Member for Dumbarton Burghs (Mr. Kirkwood). I was not quite satisfied with the answer which was given to him. I have no objection to an air service, but I would like to know whether it is to be definitely set up that a railway company can be authorised by this Bill, provided it has the consent of the company referred to in the second line of Sub-section (1) and of the Ministry of Transport, to convey mails and cargo, if it comes to that, by air as part of the ordinary carrying out of the obligations of a railway company That seems to be rather a strange departure in a small Bill dealing with communications in the Highlands and Islands.

Colonel ASHLEY

This only refers to services by air in that particular area which the MacBrayne Company might themselves provide if they thought fit, subject to Government assent.

Sir B. PETO

Only last year we gave special leave to railway companies to travel on the roads on terms of equality with all other organisations of road transport, and I think we should discuss such a grave proposition as the provision of an air service by a railway company on a totally different occasion to the present Bill. Is it the policy of the Minister of Transport to make it part of the duties and obligations of railway companies not only to travel on the roads, which are provided largely by public funds, but also to use the air in competition with other organisations as well?

Mr. KIRKWOOD

I do not wish to oppose this Bill. On the contrary, I want to do all I can to assist the Government if they are prepared to open up the Highlands and Islands of Scotland. I was surprised to hear the hon. Member for the Western Isles (Mr. MacKenzie Livingstone) talk in the way he did, because he is the one man in this House who has opposed this concession and is in favour of MacBrayne.

Mr. LIVINGSTONE

On a point of Order. When an hon. Member hears a statement which is definitely and completely untrue regarding his views, has he any immediate redress?

Mr. DEPUTY-SPEAKER (Mr. James Hope)

That is not a point of Order at all. That is a question of fact.

Mr. KIRKWOOD

I think the Government are losing a glorious opportunity by handing over the opening up the Highlands and Islands of Scotland to a private company. It was an opportunity for the Government to demonstrate to all and sundry that they are in earnest in their desire to repair the terrible havoc that has been going on in these depopulated areas. When this matter was first discussed in this House, it was said that Messrs. MacBrayne were doing a great thing, and it has been said this afternoon that they have conferred a great boon on the Highlands and Islands in agreeing to continue their service until this new company is in operation. It is no good saying that. MacBrayne could have gone out of existence at any time. The British Navy is there; we have more ships than all the ships of Messrs. MacBrayne and could carry on the transport in these areas more effectively by the Navy until these other ships are brought into the service. I did ask the Minister of Transport whether he was not going a wee bit too far in this Bill and was taking advantage of our anxiety to get something done for these areas.

I do not want to say harsh things about the Minister of Transport, but here we have an Englishman bringing in a Bill which has to do with Scotland. I think the Minister of Transport has taken advantage of our anxiety in regard to transport in the Highlands and has added something to the Bill. There is a new departure, an unprecedented departure, for it is proposed to give to a railway company control of the air. Railway companies already have control over the waterways and canals and the ferries. They are getting control of the roads, and now the Minister of Transport says they are to have control of the air. I think that is going too far. Why should we have this new proposal in a Bill which we hope is going to benefit the Highlands and Islands of Scotland; an area which produces a hardy and intelligent race, who are being driven across the seas by thousands every year. Here was an opportunity of opening up the country and make it possible to retain them at home, keep them on the land; make it possible for them to cultivate the soil and get a return from it which would keep body and soul together. We are anxious to do that, and because the Government see our anxiety, and because we have been able to carry the British public with us—and the British public are watching the actions of this Tory Government—

Mr. BUCHANAN

They take some watching.

Mr. KIRKWOOD

Yes, they take some watching; but the result of recent by-elections shows that the British public are watching them—

Mr. DEPUTY-SPEAKER

I do not see how the hon. Member can connect this with a Bill enabling a railway company to participate in the provision of mail, cargo and passenger services in the Highlands of Scotland.

Mr. KIRKWOOD

I will try and show you. The Government have added something to this Bill which has never been in a Bill before. They are giving control over an element to a private company. This House has never given the control of the air to a private company, and I am trying to explain to the House what, I think, is the idea of the Government in proposing it. They have taken advantage of our anxiety, but the British public are now on our side and are realising that the people in the Highlands and Islands of Scotland have never had a dog's chance. The only time the Highlanders came into the picture was when you wanted them to fight your battles, and now when you have a chance of showing up this company MacBrayne, who have bled the Highlands white, robbed the Highlands and practically forced thousands of them to go across the sea to Canada and elsewhere in order to seek their fortunes, and allow the Government to get control of this important matter of transport, we get this new pro- posal in this Bill. It must be remembered that transport as regards the Highlands of Scotland is essential for their development.

Cheap transport was never so easy to obtain as it is at the moment, and the Government ought to have taken advantage of this opportunity and do something in the way of cheap transport for the Highlands of Scotland without giving it away to a private company, no matter how much better it may be than MacBrayne. This company is going into the Western Highlands of Scotland, not with a view of developing that area, but in order to make profit out of the transaction. Do not tell met that this is a philanthropic institution. Never once have they demonstrated that they were prepared to make any sacrifice to develop the country. Time and time again they have exploited their valuable concession. Therefore, I hope that before the Bill passes the House will do all that is possible to tie up the company so that it shall not exploit the Highlanders of Scotland any longer.

Mr. MACPHERSON

I rise to support the Second Reading of the Bill. I am not going to deal with the controversy that has arisen between the last speaker and my hon. Friend the Member for the Western Isles (Mr. Livingstone), except to say that I am sure it is within the recollection of the House that few people have been more energetic in their desire to improve the transport of the Western Isles, and while on occasion he has condemned the MacBrayne contracts, there has been no one who has argued more successfully the desirability of more ships to give a more efficient service among the islands of the West Coast. I am not sure that the last speaker is right in his view that this new company is out to exploit the Western Islands. I know from the experience in that part of the world in the past that we have now reached a stage when we are careful of any new company entering that sphere, and it will be the duty of this House to see that there is no exploitation of any kind by any new company in the way suggested by the hon. Member, who represents Dumbarton Burghs (Mr. Kirkwood).

The House of Commons is to be congratulated on the fact that the railway company in this case really came to the rescue, and although I have no very great love for joint stock companies, I think that the London Midland and Scottish Company are really deserving of the thanks of this House, and particularly of the Scottish Office, for coming forward and willingly doing their best to get that part of Scotland out of a very serious difficulty. Consequently I welcome their intervention, and I hope that their taking over of these very important duties will be a very great success indeed. While I say that as a Member for one of the divisions of Scotland more directly concerned, I hope that I shall still continue the vigilance which Scottish Members have shown in the past so far as transport facilities and difficulties on the West Coast of Scotland are concerned.

I welcome the coming in of a great railway company of this kind for two reasons. I think that the residents in that part of the world will now have a guarantee, not only of greater efficiency, but that the steamers can he run in unison with the railways. You will not now find yourself landed on the mainland in the early morning, from Stornoway or Skye or any of the other islands, two hours after the first morning train has gone. That was an intolerable condition of things. If we give a Second Reading to the Bill and establish the company in the way suggested by the Bill, we shall have a guarantee that in future there will always he a connection between the steamboat and the railway train, and that will be of enormous advantage to the people in the Western parts of Scotland and the islands.

There is one other matter which comes directly from the powers given in this Bill. I hope the Government will see to, it that there is a through connection from the boat to the train, right to the journey's end, and a through freight for goods and commodities carried by this new steamer service. Take a case in point. I have in my constituency a place called Applecross, on the west coast of Ross-shire. I find that there are very different freights from Glasgow to Kyle and from Kyle to Applecross, a distance of about 15 miles. The freight for the short distance is infinitely greater than that for the much longer distance between Glasgow and Kyle. The advent of the railway company which is guaranteed by this Bill will, I hope, remedy that sort of thing. We owe a debt of gratitude to the company for coming forward at great risk to relieve not only the Government, but that part of the country, from a very great difficulty.

Mr. SHINWELL

I cannot let this occasion pass without expressing my dissent from the proposals contained in the Clause of the Bill now under discussion. It seems to me that this would have been a favourable moment for the Government to have transformed the existing shipping service into one of a public character. This service can hardly be regarded as complicated. The number of vessels required is small, the service itself is not complex, and the commodities that require to be transported are easily handled. In the circumstances the Government might have experimented with a State-owned service. It was said in the House, when the matter was previously under review, that to convert this service into a public service would be to introduce what is regarded as the pernicious principle of political interference. As to that I have only to say that in the contract which we are about to discuss and the progress of which I have no desire to arrest, there are conditions expressly stipulated in respect of the means of conducting these operations, and these make it essential for us from time to time to interfere politically. If I may anticipate, without transgressing the Rules—

Mr. DEPUTY-SPEAKER

I do not know whether the hon. Member is arguing that the Government rather than the railway company should control, or contribute to the control of this service.

Mr. SHINWELL

That is precisely my point. I have no desire to enter into the details of the contract. I am rather discussing the general principle. I was about to point out—and I think you will find that I am not transgressing the rules is doing so—that conditions are laid down in respect of the method of conducting the service, and that those conditions entail, the duty on Members of this House who are interested, of inviting the attention of the right hon. Gentleman the Secretary of State for Scotland and his friends from time to time to matters arising from the conduct of the service. That is political interference. In some measure it amounts to political control, so that you do not escape the dilemma—if it be a dilemma—of political interference by refusing to transform the existing service into a strictly public service. Therefore, I think that argument must go by the board.

On the whole, I am bound to say that I feel disappointed that this essentially simple service however important it may be—and it is important—should be left in the hands of a semi-public utility undertaking which, in spite of what has been said regarding exploitation by the right hon. Gentleman the Member for Ross and Cromarty (Mr. Macpherson), does, in a measure, continue to exploit since a margin of profit is provided. I am open to correction, but I understand that if a margin of profit is provided for, there is exploitation. True it is limited; nevertheless, the exploitation remains. I do not pretend for a moment that anything that my friends and I may say at this stage will induce the Government to change its mind. This Government rarely changes its mind, and is less liable to do so on this occasion than on any other, but I think it is desirable to express our views regarding the proper method of conducting this important service.

The SECRETARY of STATE for SCOTLAND (Sir John Gilmour)

I desire to say only a few words on behalf of the Scottish Office in connection with this Bill. I wish to support what has been said on all sides of the House to the effect that this Bill is the outcome of a great deal of labour and consideration on the part of the Select Committee. They went into the problem with great thoroughness, and they have been able to bring to the solution of the problem, not only a shipping company with a record which is well known to all those who follow the work of great shipping organisations, but they have also been able to induce one of the great railway companies to take a share in trying to improve this service. It is, of course, apparent that the co-operation of the railway service and the sea service, if carried out in the spirit in which this Measure is intended, must be of material advantage to those who are to be served, and I hope that the House will give its approval to the Bill and will give a fair and reasonable opportunity to those who enter into these undertakings to show that they mean to carry out those under-takings for the best advantage of the community in which we are all interested.

Mr. HARDIE

I agree that there has been a great deal of work and trouble in getting to the point which we have reached but I hold that the rightful claims of the islanders are not being met, even by this Bill. Last summer I visited some of these islands and got first-hand information. The claim of the islanders is sound and honest. They claim that as they pay taxes like other people, they ought to have their produce carried at the same rates as the people on the main-land. That is the only basis on which you can bring a sense of equality to the islanders. It is no use saying that trans-port costs more in their case. If our nation is made up of islands and main-land and if all the inhabitants are citizens alike, they should all be treated alike in the matter of these essential services. My regret is that the Government did not seize this most delightful opportunity of showing what a Government could do for its people in these conditions. This Bill, as I say, will not meet the islanders' claim that their produce should be moved at the same rate per mile as that which obtains on the mainland. In that way a handicap is placed on the islanders and the Government have lost a magnificent opportunity of showing the meaning of real government in this matter.