HC Deb 25 June 1936 vol 313 cc2026-57

6.20 p.m.


I beg to move, in page 2, line 3, at the end, to insert: and (c) no subsidy shall be paid under any such agreement unless the persons intended to be subsidised shall agree to co-operate reasonably with the owners of other British air-transport services and not to use their subsidised position in any way which the Secretary of State may consider to be detrimental to such other services. On the Second Reading and during the Committee stage there was considerable discussion as to the granting of subsidies to new companies and the object in moving this Amendment is to get something fairly clear from the Minister on the point. From the taxpayers' point of view it is infinitely better, once a subsidy has been given to any particular company, that every effort should be made to see that duplicate services are not run by another company to the detriment of the taxpayers' money. Originally, four or five companies were working between London and Paris and they were merged into one large company and subsidised under the name of Imperial Airways. There are other instances where subsidies have been given to a merger company, the Cunard-White Star lines, and the railways during the War. The Government have generally considered that it is in the public interest when public money is given by subsidies, that the merger interests should be secured as far as possible. That is particularly necessary in the aviation world. You may have one company operating a service to a given place with an aerodrome and the cost of upkeep, and another company wishing to fly to the same place and having to build another aerodrome. It appears to those who support this Amendment that the taxpayers' money is well expended in Imperial Airways because there has been a merger, and they work on the lines I have indicated. If we are to give subsidies to new companies or to other companies running in competition to the same places, then a great deal of the money—it is not a large sum—which is to be devoted to the development of civil aviation will not be put to the best advantage.


I beg to second the Amendment.

6.25 p.m.


I take this opportunity of once again appealing to the Government to use their good offices to bring together British Airways and British Continental Airways. They both run between London and Stockholm. They are both financed by British capital, and they are both run by British pilots. One gets a subsidy and the other does not. While we are satisfied as to the way in which the subsidy is granted, it is not in the best interests of British flying that these two companies should be competing, and I would urge that everything should be done to bring these two concerns together by the Under-Secretary himself calling a conference and himself presiding over it, to thrash out a scheme which will result in the elimination of a great deal of wasteful competition. The right hon. Gentleman really has got the whip hand. He has offered the subsidy to one company, but it cannot be granted until this Bill becomes law. Is it possible for him to hold his hand until he has done everything in his power to bring these two concerns together?

6.27 p.m.


I agree that any union of companies which can be brought about by the activities of the Secretary of State is of benefit to the Air Service. The duplication of services is a disadvantage to the public. But there is a danger in this Clause. The hon. Member for Melton (Mr. Everard) confined his argument to the new companies which are starting under a subsidy. These, I understand, are the Scandinavian services and the South Atlantic services. The companies which fly these services will be put to great expense. They will have to make aerodromes, build up their services, and spend money on making a connection, and I see a danger that some duplication might take place under the Clause. I admit that the Clause is carefully drafted and that the people who are to have the advantage of using the facilities are to co-operate reasonably, and that the Secretary of State is to be satisfied that their co-operation will not be detrimental to existing services. But still I see a danger of getting a duplication of services. There is a danger of our going back to the position as it was before the Imperial Airways merger.

In the matter of transport the State has decided that competition in transport is not in the public interest. In the early days of railways Parliament was much more willing to grant running powers to rival interests than it is now, and in the case of roads, which at first were free to all who desired to run competing services, the State has now wisely regulated the traffic and does not allow the interloper to butt in at profitable times, run a service to a race meeting or a fair and skim the cream of the traffic. The State, through the Traffic Commissioner, is very wise in doing that, because the regular services would not be so efficient if they were liable to be attacked by an outsider in that way. Although I wish to help civil aviation as much as I can, and do not want to see competition on these new services which the State is going to subsidise, I suggest that there is a danger that if the Clause were passed in this form, the very object which it seeks to obtain might be jeopardised.

6.31 p.m.


I would like to say a few words in support of the Amendment, because I believe there is a point of substance in it. From information which I have received, I believe it to be the case that Imperial Airways, for example, use their privileged position to: make things difficult for people who try to operate services on the same route. They certainly do not welcome competition, and they have great powers which E am not satisfied are exercised as fairly and impartially as they ought to be. I think that before these great sums of money are given to any company, assurances ought to be received—and steps ought to be taken to see that those assurances are carried out—that everybody will have an equal opportunity on those routes, whether subsidised or not. I do not say this as any criticism generally of Imperial Airways which, as I have said before in this House, have done admirable work. That, however, is no reason why they should misuse any of the powers given to them. Apart from that, this is an issue which will tend to arise more and more as we make further agreements concerning other parts of the world. My right hon. Friend the Under-Secretary of State for Air is at the present time dealing with applications from five different firms to run a service to South America, and he told me yesterday that the applications had all been sent back for certain reasons to those who made the tenders. I am bound to say that at any rate one of them has received no information whatever, so that, in fact, the statement which the right hon. Gentleman made seems to have been incorrect. I should be glad if he would be good enough to look into that point. When the subsidised service is run to South America it is conceivable that there may be other people willing to run a service without receiving a subsidy. If that be so, assurances ought to be given that the subsidised service will not use its powers in any way to the detriment of other services.

6.35 p.m.


I would like to support the Amendment if I could, but from the wording I cannot see how it would be applied. The words "shall agree to co-operate reasonably" present enormous difficulties which might have been removed if the Mover had inserted certain definite things which were to be within the power of the Secretary of State for Air. That which seems reasonable to an unsubsidised company may not seem reasonable to a subsidised company, and the fight which is now going on between the two is such that it brings some disgrace—if I may use that word—into the development of civil aviation, which we are trying to assist. If we are to have co-operation in British air transport, it seems to me that this is not the way to obtain it. One cannot ask a company which is not subsidised to co-operate with a company which is subsidised. What we ought to do is to put civil aviation on a national basis. It is absurd to subsidise one company and expect unsubsidised private enterprise to compete with it. If civil aviation is to be developed on a basis which will leave no room for such Amendments as the one which is now before us, every part of it must he under national control, and if that were the case all the difficulties which arise out of one company competing with another would be removed. We have heard to-day about the ever-increasing difficulties in air transport due to private enterprise. It has been pointed out that air transport does not pay, but those who say that always advocate that the corporate body shall spend some money on it. The demand for municipal aerodromes is illustrative of that. While it is known that air services do not pay as services, the municipalities or the nation are always asked to step in to assist in some way. Why not be reasonable and say that since civil aviation has to be assisted in that way, we will now enter into the business on a national basis and so complete the job?

6.38 p.m.


I apologise that unavoidable circumstances precluded my being in my place at the time when you called upon me to move this Amendment. With regard to the point which the hon. Member for Springburn (Mr. Hardie) raised, much as I would like to follow him, I do not think this is the time and opportunity to discuss national ownership of civil air transport. We are at the moment faced with the problem of dealing equitably both with subsidised and unsubsidised civil air transport companies, and I think that is the problem to which we must exclusively devote our attention. I suggest there is good reason for introducing this proviso in that Imperial Airways, Limited, which are clearly the largest recipient of these subsidies, appear to my hon. Friends and myself to be taking a view which is logical enough to them, but which appears to us not quite to embrace the conception of a subsidised company in civil air transport held by many hon. Members.

It boils clown to this main question: Are we subsidising Imperial Airways, Limited, for the benefit of the shareholders of that company, or are we subsidising them in order that we may develop British civil air transport throughout the Empire? I believe the latter is and has always been the intention of this House. Therefore, it is right that we should examine the attitude of Imperial Airways towards other civil aircraft operators who are not in receipt of subsidies. I will give two instances of the policy which Imperial Airways adopt. I would call that policy a hard commercial policy, but I would not in any way suggest that it is an improper policy. I would suggest that probably the Air Ministry have been at fault in the past in not making abundantly clear what are the general responsibilities of a subsidised company to other unsubsidised civil air transport companies. Therefore, if we can elucidate that position so that we may be clear in future, we shall have gained much by this new proviso.

First, there is the question as to whether there shall be reasonable co-operation between a subsidised company and an unsubsidised company so far as the reception of passengers and freight is concerned. I have here a memorandum, dated 11th February of this year, in which Imperial Airways made it abundantly plain to all their staff what was the atti- tude of the company. The Memorandum says: If they," (that is, the unsubsidised companies) "ask us to carry loads of freight which, for some reason or other, they are unable to accommodate, we politely regret that owing to lack of space we are unable to assist them. With regard to any passengers they may not be able to carry on their services through cancelled services, we are not prepared to accept them straight from the companies concerned with a view to carrying them on behalf of those companies. That may be very much in the interests of the shareholders of Imperial Airways in that the air-travelling public will begin to realise that if, for any reason, the services of these unsubsidised companies are curtailed, or postponed, Imperial Airways will do nothing to assist those passengers to reach their destination. That is indicative of the attitude of this vast company with its strides right across the surface of the Empire. Here possibly is another little incident which is more intimate to the responsibilities of my right hon. Friend the Under-Secretary of State for Air. Last Monday, unfortunately, an aircraft of one of the unsubsidised companies crashed in the middle of Croydon aerodrome owing to the fact that the pilot omitted to wind down his undercarriage, which was of the retractile type. This is what the managing director of that company wrote by way of apology to the chief aerodrome officer at Croydon Aerodrome on the following day: With regard to the unfortunate accident which occurred late last night, when one of our machines came to grief in the middle of the aerodrome, we very much regret that we were unable to move the machine for many hours and that it had to remain right in the middle of the aerodrome during most of the night. We did our utmost to get the machine away as soon as possible, but as Imperial Airways were the only people who had suitable tackle for lifting and drawing the machine out of the way of other aircraft, we called upon them for assistance. They actually started the work, but when it was discovered by the officials of Imperial Airways that they were helping our firm, which is under their boycott, they immediately instructed their men to discontinue the work. It was too late at night to obtain any assistance beyond that which your own aerodrome staff were able to give us, and after many hours, with the help of several motor cars, we managed to tow the machine out of the way and to a position of safety. Unfortunately, our machine was severely damaged during this procedure. Regretting the inconvenience caused.… That machine was not only a danger to Imperial Airways, but was a danger to all aircraft using Croydon aerodrome that night. It seems to me very serious that the civil air transport company which we have subsidised in this country should so fail to understand its general responsibilities to the country that it should allow a state of affairs such as I have read out to continue. I particularly wish to emphasise the fact that foreign aircraft operating companies regard their own capital cities as their own particular purview and responsibility. That is to say if any aircraft, German, British, French or Belgian crashed at the Tempelhof Aerodrome at Berlin, as any hon. Member who has been there and has seen the efficiency of that air-port will agree, the Deutsche Lufthansa, the German subsidised transport company, would immediately strain every nerve to have that aircraft removed in the shortest possible time.

These are not by any means all the incidents that I could bring to the attention of the House to show how necessary it is that this point should be cleared up as to the general responsibilities of subsidised air transport companies to the country, and thus to all other air transport operators. Hon. Members have talked frequently about the inability of certain air transport companies to use certain booking offices. That is another indication of the general trend of policy of our great subsidised company. I appeal to the Under-Secretary, if he cannot accept this Amendment, to give us a definite indication of the attitude of the Government towards all subsidised companies—I do not speak only of Imperial Airways. I ask him to tell us whether he will call upon all these companies to behave, generally, in a manner which will assist the reputation and the development of British civil air transport. The point was made by the hon. Member opposite that there was a possibility of the word "reasonably" being misunderstood, but I do not think there is any fear of that. The word "reasonably" is to be interpreted by the Secretary of State in relation to what he considers to be "detrimental to such other services." I hope, in view of the strong support which I know is felt throughout the House for this proposal, that my right hon. Friend will be able to assist us in this matter.

6.49 p.m.


I am sure the House is indebted to the hon. Member for Duddeston (Mr. Simmonds) for bringing before us information which is of grave importance when we are considering the principles upon which State subsidies should be granted to civil aviation companies. He made it clear that Imperial Airways, which is the company receiving the largest amount of subsidy—up to a maximum of £1,500,000 a year—is not only pursuing a policy of non-co-operation with other and smaller companies, which are not receiving subsidies but has embarked on a policy of boycott with regard to them. Indeed we have been confronted with examples of situations in which they have pursued a definitely anti-social policy. Here is the case of a machine which crashes in the middle of a Government aerodrome and because it belongs to a company which is a humble rival of Imperial Airways, they make no effort, in the interests of public safety, to remove the wreckage. It is precisely as if a hangar, outside the danger-zone of Imperial Airways property, at one of these aerodromes, were to burst into flames and Imperial Airways refused to help with fire-extinguishing apparatus.

Suppose the right hon. Baronet went on a, journey, incognito, and made the first part of that journey in an unsubsidised machine and endeavoured to continue it in an Imperial Airways machine. Apparently, if Imperial Airways knew that he had been giving his patronage to an unsubsidised company, they would refuse to carry him for the remainder of the journey and he might have to stop for a week, perhaps in the middle of the desert, until a service was provided for him. However reluctant the Minister may he to do anything which would arouse the displeasure of Imperial Airways, he must recognise that in this case a vital principle is at stake. I understand that those who move this Amendment are not tied to the words and I think that the words could be improved. I do not anticipate that the word "reasonably" will raise any difficulty of interpretation. It is a word which is being interpreted every day in the courts and is perhaps one of the words which gives rise to least trouble in the courts.

The second part of the proposal, however, may require some modification. One difficulty is that the company receiving the subsidy is merely required to "agree to co-operate reasonably." I do not know whether that implies that failure so to agree, would involve the sanction of withdrawal of the subsidy. It should be made crystal clear that the provision will apply, if a company in receipt of a subsidy maintains an anti-social policy in the conduct of its services—which we have shown to be possible—or has a lesser degree of guilt in maintaining an attitude of non-co-operation or boycott towards its rivals, or has a still lesser degree of guilt in withholding its cordial co-operation from unsubsidised companies. The principle which we want to establish is that such a company should look upon these other companies not as rivals but as younger brothers, if I may put it in that way, engaged in the same great pioneer work of building up the civil aviation of this country. I sincerely hope that the right hon. Baronet will recognise the importance and reasonableness of the proposal and accept this Amendment, or something like it.

6.54 p.m.


I wish to endorse all that has been said by the last two speakers. I have here the bills of a private flyer who had to land at various Imperial Airways ports between here and India. I do not think anyone will disagree with me as to the importance of encouraging private flying in this country at the present time. This pilot had to land at Gaza and there he was charged, in addition to the half-crown landing fee, no less than £1 for services in connection with the clearance of the aerodrome. He had to land at Gaza to clear the Customs and he was only on the ground for 30 minutes and all that the station superintendent had to do was to telephone to the Customs officer, approximately a mile-and-a-half away. For that, as I say, a fee of £1 was charged, and at every station where he landed on an Imperial Airways landing ground, the same extraordinarily heavy charges were made. In view of the fact that we pay a very sufficient subsidy to Imperial Airways and that in many cases the service of their aerodromes is provided for them. I think the least we might expect in return is that they should do all in their power to encourage anyone who has to use those aerodromes.

I should also like to mention the case of the Railway Clearing House and the subsidised lines. As hon. Members know, the Railway Clearing House is a body formed in order that railway companies might have certain power in regard to the sale of tickets on their lines by agencies. That has been extended to cover the booking of tickets on various air lines and the position to-day is that Messrs. Pickfords, Thomas Cook & Son, Dean and Dawsons and other companies, are unable to sell tickets for some of the air lines of this country, and I think I am right in saying that they cannot sell tickets to people abroad for any British line other than Imperial Airways. I think it is an appalling situation that we in the House should allow that system to continue, when we all recognise the importance of encouraging civil aviation and when so much lip service is being paid to the importance of civil aviation. To quote one instance, the Blackpool and West Coast air services established the pioneer air service between Liverpool, Blackpool and the Isle of Man. I think I am right in saying that they were two years in advance of any railway air service but from the moment the railway services began to run their air line and they actually took over the aerodrome which had been provided by the pioneer company, it was impossible for any ticket to be issued by Cooks or any of the well-known travel agencies for the Blackpool and Liverpool lines. I think it is most important that we should have an assurance from the Under-Secretary that an end shall be put to that disgraceful state of affairs and I hope that, in addition to giving that assurance, he will accept the Amendment.

6.57 p.m.


I suppose a case can be made out for the contention that the resources of a great company which has practically a monopoly should not be put at the disposal of its rivals. For instance, if a vehicle belonging to another undertaking breaks down on the road, it can be argued that there is no necessity for London Transport to get out their breakdown gear to clear the wreckage. But what shows itself clearly in this discussion is that unless we get a national spirit in these subsidised companies, the sooner they go the better and the sooner we go the whole hog and have a nationalised Imperial service the better. If companies which are taking the British taxpayers' money are to behave like ordinary companies, competing one against the other, with no Imperial or national ideal, then they will go. We may pass Acts of Parliament thinking that we are going to have these subsidies for many years but things will change. Everything can be wiped out by the power of this House. Although it may be difficult for the Under-Secretary to accept this actual Amendment it is high time for him, speaking with the authority of the Government, to say clearly to all these undertakings which are accepting public money that they will have to behave themselves as the representatives of an Imperial interest.

6.59 p.m.


I very much regret that I cannot accept the Amendment for reasons which I shall presently explain, but I am in full sympathy with the hon. Member for Melton (Mr. Everard) who moved it and those who have supported it, in their desire to ensure that there shall be no abuse by subsidised companies of their position in any way that would be detrimental to British civil air aviation. Perhaps I may explain some of the difficulties in the way of accepting the Amendment. In the first place, I am advised that a provision of this kind would not be suitable for statutory enactment on various grounds. It would, for example, be extremely difficult to define what is and what is not reasonable co-operation. It might also be difficult to define what is detrimental to other services. In the second place, I would ask hon. Members to bear in mind that in this as in other matters there are, generally speaking, two sides to the question. A great many instances have been brought to notice to-night about various acts of unfriendliness by Imperial Airways towards other companies. I do not think that I can take up the time of the House or that hon. Members would wish me to in going into all these cases. I am sure that the House will agree that there is nothing to be gained by pursuing charges and counter-charges when we are all in substantial agreement on the matter. That would only make the position more difficult.

We all wish to ensure that between subsidised companies and unusubsidised companies there should be reasonable co-operation in the interests of British civil aviation, and that there should be no tendency on the part of a subsidised company to abuse its position. I can assure hon. Members that the desire of the Air Ministry is to see fair play in this matter, and it is the policy of the Government that a subsidised company must not take an unfair advantage of its position. The Air Ministry is prepared to examine any representations from other companies which are brought before it and are prima facie reasonable, and, if the grounds of complaint are substantiated, to call on the company concerned to fulfil the understanding upon which the subsidy is based. The Air Ministry will make it perfectly clear when they grant a subsidy that it is given on the direct understanding that the company does not abuse its position. We think we shall thus ensure by effective administrative action, that while there shall be no interference with the free play of legitimate commercial competition, subsidised companies shall not snake use of their position in an unfair way because they are recipients of Government grants. I think that after this explanation and of the difficulty of framing a proviso such as this, hon. Members will realise that I have gone as far as I can to meet their desires.


Do I gather from the Under-Secretary that an inquiry will be instituted to find out whether the statements which have been made are facts, and, if so, that the causes will be removed?


I will certainly make an inquiry.


Will the Under-Secretary, in regard to all the cases brought to his notice of discrimination in the selling of tickets at ticket agencies, use his influence to see that that is not the case in the future?


Certainly, but that does not lie with the Air Ministry; it lies with the railway companies.

7.4 p.m.


It is a little more than that. Imperial Airways is a semi-State undertaking which is in a special position. If we are to make our present service efficient and satisfactory to the public, the Government must see that the balance is fairly held between the various interests concerned. They must not be merely negative, but positive. It is true that these tourist agents under pressure are inclined to give a monopoly to the railway services and to Imperial Airways. We have to face facts. I understand that we want the country to be air-minded, and if anybody wishes to travel by air he goes to these agents. The Minister should make it clear to Imperial Airways, the railways and the tourist agents that if these kind of things are going on the Government will find it necessary to reorganise the whole of their policy and to change their attitude to Imperial Airways. There is a lot to be said for monopoly and a lot for competition, but at present we are in danger of having the worst of both possible worlds.

7.6 p.m.


May I ask whether the position cannot be safeguarded by the introduction into the contract with Imperial Airways of terms which, in effect, will give the Minister the position of arbitrator if a dispute arises?


I appreciate what the Under-Secretary has said, that he will watch from the administrative point of view to see that the subsidised companies implement the general responsibility which, he tells us, they have undertaken to the Air Ministry. But with regard to the case of the crash at Croydon Aerodrome—


The hon. Member has already spoken.


I beg to ask leave to withdraw the Amendment.



7.7 p.m.


I do not think that the House should part with this matter in that way, because the statements made by the hon. Members for Duddeston (Mr. Simmonds) and Frome (Mrs. Tate) were very categorical, and it seems to me that they reveal a shocking state of affairs. I can recollect nothing like it since the days when insurance companies had their own fire brigades and a brigade was not allowed to put out a fire which occurred at a house insured by a rival company. It is said that the firemen of one company went up to watch the fire to make sure that it did not accidentally go out. These statements are extremely serious because in one case, unless there is some answer to it, it seems that the people who prevented the removal of a wrecked aeroplane were acting against ordinary, common humanity. That involves the public interest. It is obvious that some unsuspecting person might attempt to land on an aerodrome and be severely injured in the process because somebody had refused to help, if the statement made by the hon. Member for Duddeston is true, and there has been no reply to it.

We understand that to remove that spirit the Under-Secretary proposes to address a stream of platitudes to the offending company. It was my experience as a schoolmaster that platitudes, while extremely gratifying to the person who utters them, have little effect on the party to whom they are addressed, and I sincerely hope that the right hon. Gentleman will arm himself with something more effective. [An HON. MEMBER: "Sanctions."] I would not trust them with sanctions. I imagine the answer of the right hon. Gentleman would be "I will try sanctions." There should be some fight behind the sanctions on this occasion, and it should be made clear that a repetition of the policy outlined this afternoon will be met with the withdrawal of the subsidy, and that what the House wishes is that there should be a widespread desire on the part of all concerned with this industry to help one another, especially to help private flyers in any difficulties which they may encounter in the course of their flying. I could hope that somebody speaking on behalf of the Government would say that they propose, in view of the instances which have been brought before the House, to arm themselves with effective powers to make it clear that if people who get subsidies attempt to make those subsidies into monopolies they are to be appropriately dealt with, and that they should regard the receipt of a subsidy not merely as a benefit but as conferring on them certain responsibilities with regard to any dangers that may be encountered by less fortunate people.

Question put, "That those words be there inserted in the Bill."

The House dividend: Ayes, 107; Noes, 180.

Division No. 251.] AYES. [7.11 p.m.
Acland, R. T. D. (Barnstaple) Hardie, G. D. Ritson, J.
Adams, D. M. (Poplar, S.) Harris, Sir P. A. Roberts, Rt. Hon. F. O. (W. Brom.)
Adamson, W. M. Henderson, J. (Ardwick) Roberts, W. (Cumberland, N.)
Alexander, Rt. Hon. A. V. (H'lsbr.) Henderson, T. (Tradeston) Rothschild, J. A. de
Ammon, C. G. Hills, A. (Pontefract) Rowson, G.
Attlee, Rt. Hon. C. R. Holland, A. Seely, Sir H. M.
Banfield, J. W. Jagger, J. Sexton, T. M.
Barnes, A. J. Jenkins, A. (Pontypool) Short, A.
Barr, J. Jenkins, Sir W. (Neath) Silkin, L.
Benson, G. Jones, Morgan (Caerphilly) Silverman, S. S.
Bevan, A. Kelly, W. T. Simpson, F. B.
Brooke, W. Kennedy, Rt. Hon. T. Sinclair, Rt. Hon. Sir A. (C'thn's)
Burke, W. A. Lathan, G. Smith, E. (Stoke)
Chater, D. Lawson, J. J. Smith, T. (Normanton)
Cluse, W. S. Lee, F. Sorensen, R. W.
Clynes, Rt. Hon. J. R. Leonard, W. Stewart, W. J. (H'ghtn-le-Sp'ng)
Cocks, F. S. Leslie, J. R. Strauss, G. R. (Lambeth, N.)
Cove, W. G. Logan, D. G. Taylor, R. J. (Morpeth)
Daggar, G. Macdonald, G. (Ince) Thorne, W.
Dalton, H. McEntee, V. La T. Tinker, J. J.
Davies, D. L. (Pontypridd) McGhee, H. G. Viant, S. P.
Davies, R. J. (Westhoughton) McGovern, J. Walker, J.
Dobbie, W. MacLaren, A. Watkins, F. C.
Ede, J. C. MacMillan, M. (Western Isles) Watson, W. McL.
Edwards, Sir C. (Bedwellty) Mander, G. le M. Westwood, J.
Evans, D. O. (Cardigan) Marklew, E. White, H. Graham
Gardner, B. W. Marshall, F. Whiteley, W.
Garro Jones, G. M. Messer, F. Wilkinson, Ellen
George, Major G. Lloyd (Pembroke) Milner, Major J. Williams, E. J. (Ogmore)
George, Megan Lloyd (Anglesey) Morrison, R. C. (Tottenham, N.) Williams, T. (Don Valley)
Green, W. H. (Deptford) Naylor, T. E. Wilson, C. H. (Attercliffe)
Greenwood, Rt. Hon. A. Oliver, G. H. Woods, G. S. (Finsbury)
Grenfell, D. R. Paling, W. Young, Sir R. (Newton)
Griffiths, J. (Llanelly) Pethick-Lawrence, F. W.
Groves, T. E. Potts, J. TELLERS FOR THE AYES—
Hall, G. H. (Aberdare) Rathbone, Eleanor (English Univ's.) Mr. Charleton and Mr. John.
Hall, J. H. (Whitechapel) Richards, R. (Wrexham)
Acland-Troyte, Lt.-Col. G. J. Dawson, Sir P. Hudson, Capt. A. U. M. (Hack., N.)
Adams, S. V. T. (Leeds, W.) De Chair, S S. Hudson, R. S. (Southport)
Agnew, Lieut.Comdr. P. G. Denman, Hon. R. D. Inskip, Rt. Hon. Sir T. W. H.
Albery, Sir I. J. Dixon, Capt. Rt. Hon. H. Jackson, Sir H.
Aske, Sir R. W. Dorman-Smith, Major R. H. Jarvis, Sir J. J.
Atholl, Duchess of Dower, Capt. A. V. G. Kerr, Colonel C. I. (Montrose)
Baldwin, Rt. Hon. Stanley Drewe, C. Keyes, Admiral of the Fleet Sir R.
Baldwin-Webb, Col. J. Duckworth, G. A. V. (Salop) Lamb, Sir J. Q.
Balfour, Capt. H. H.(Isle of Thanet) Duckworth, W. R. (Moss Side) Lambert, Rt. Hon. G.
Beamish, Rear-Admiral T. P. H. Dugdale, Major T. L. Latham, Sir P.
Beaumont, M. W. (Aylesbury) Duncan, J. A. L. Leckie, J. A.
Blindell, Sir J. Dunglass, Lord Leech, Dr. J. W.
Boulton, W. W. Eastwood, J. F. Lindsay, K. M.
Bower, Comdr. R. T. Elliot, Rt. Hon. W. E. Llewellin, Lieut.-Col. J. J.
Briscoe, Capt. R. G. Emrys-Evans, P. V. Lloyd, G. W.
Brocklebank, C. E. R. Entwistle, C. F. Locker-Lampson, Comdr. O. S.
Brown, Rt. Hon. E. (Leith) Everard, W. L. Loftus, P. C.
Brown, Brig.-Gen. H. C. (Newbury) Findlay, Sir E. Lyons, A. M.
Bull, B. B. Fleming, E. L. Mabane, W. (Huddersfield)
Campbell, Sir E. T. Furness, S. N. MacAndrew, Colonel Sir C. G.
Carver, Major W. H. Glyn, Major Sir R. G. C. MacDonald, Rt. Hon. M. (Ross)
Cayzer, Sir H. R. (Portsmouth, S.) Goodman, Col. A. W. McKie, J. H.
Chamberlain Rt. Hn. N. (Edgb't'n) Gretton, Col. Rt. Hon. J. Makins, Brig.-Gen. E.
Chorlton, A. E. L. Grimston, R. V. Margesson, Capt. Rt. Hon. H. D. R.
Clarke, F. E. Guest, Capt. Ht. Hon. F. E. (Drake) Markham, S. F.
Collins, Rt. Hon. Sir G. P. Guinness, T. L. E. B. Mason, Lt.-Col. Hon. G. K. M.
Colville, Lt.-Col. Rt. Hon. D. J. Gunston, Capt. D. W. Mayhew, Lt.-Col. J.
Cook, T. R. A. M. (Norfolk N.) Guy, J. C. M. Meller, Sir R. J. (Mitcham)
Cooper, Rt. Hn. A. Duff (W'st'r S.G'gs) Hanbury, Sir C. Mellor, Sir J. S. P. (Tamworth)
Cooper, Rt. Hn. T. M. (E'nburgh, W.) Hannah, I. C. Mills, Major J. D. (New Forest)
Courthope, Col. Sir G. L. Haslam, H. C. (Horncastle) Mitcheson, Sir G. G.
Craddock, Sir R. H. Haslam, Sir J. (Bolton) Morrison, G. A. (Scottish Univ's.)
Cranborne, Viscount Herbert, Major J. A. (Monmouth) Nall, Sir J.
Crooke, J. S. Hills, Major Rt. Hon. J. W. (Ripon) Neven-Spence, Maj. B. H. H.
Crookshank, Capt. H. F. C. Hoare, Rt. Hon. Sir S. Nicolson, Hon. H. G.
Crossley, A. C. Holmes, J. S. O'Connor, Sir Terence J.
Crowder, J. F. E. Hope, Captain Hon. A. O. J. Ormsby-Gore, Rt. Hon. W. G.
Cruddas, Col. B. Horsbrugh, Florence Orr-Ewing, I. L.
Davies, Major Sir G. F. (Yeovil) Howitt, Dr. A. B. Palmer, G. E. H.
Penny, Sir G. Shaw, Captain W. T. (Forfar) Train, Sir J.
Percy, Rt. Hon. Lord E. Shepperson, Sir E. W. Tree, A. R. L. F.
Perkins, W. R. D. Simmonds, O. E. Tryon, Major Rt. Hon. G. C.
Petherick, M. Simon, Rt. Hon. Sir J. A. Tufnell, Lieut.-Com. R. L.
Plugge, L. F. Sinclair, Col. T. (Queen's U. B'lf'st), Turton, R. H.
Porritt, R. W. Smithers Sir W. Wakefield, W. W.
Ramsay, Captain A. H. M. Somervell, Sir D. B. (Crewe) Walker-Smith, Sir J.
Ramsden, Sir E. Somerville, A. A. (Windsor) Ward, Lieut.-Col. Sir A. L. (Hull)
Rayner, Major R. H. Southby, Comdr. A. R. J. Ward, Irene (Wallsend)
Robinson, J. R. (Blackpool) Spears, Brig.-Gen. E. L. Warrender, Sir V.
Ropner, Colonel L. Stanley, Rt. Hon. Oliver (W'm'l'd) Waterhouse, Captain C.
Ross Taylor, W. (Woodbridge) Storey, S. Wedderburn, H. J. S.
Ruggles-Brise, Colonel Sir E. A. Strauss, E. A. (Southwark, N.) Wickham, Lt.-Col. E. T. R.
Runciman, Rt. Hon. W. Strickland, Captain W. F. Windsor-Clive, Lieut.-Colonel G.
Russell, S. H. M. (Darwen) Stuart, Lord C. Crichton- (N'thw'h) Wise, A. R.
Salmon, Sir I. Stuart, Hon. J. (Moray and Nairn) Withers, Sir J. J.
Samuel, Sir A. M. (Farnham) Sueter, Rear-Admiral Sir M. F. Womersley, Sir W. J.
Sanderson, Sir F. B. Sutcliffe, H. Wood, Rt. Hon. Sir Kingsley
Sassoon, Rt. Hon. Sir P. Tasker, Sir R. I. Wragg, H.
Savery, Servington Tate, Mavis C.
Selley, H. R. Thomas, J. P. L. (Hereford) TELLERS FOR THE NOES.—
Shakespeare, G. H. Touche, G. C. Dr. Morris-Jones and Mr. Cross.

7.20 p.m.


I beg to move, in page 2, line 3, at the end, to insert: (c) the intention of the Secretary of State to consider proposals for an air transportation scheme covering the route involved in the agreement shall be publicly advertised and reasonable opportunity shall be given for the presentation of competing offers; the Secretary of State may however in the case of Imperial Airways, Limited, be authorised to omit this action provided that public notice thereof is given. Perhaps I may explain the circumstances under which I have put down this Amendment. When the Bill was before the House on 25th May, in Committee, I moved an Amendment which in terms was very similar, and after considerable debate the Solicitor-General was good enough to say that, while he could not accept the actual wording of the Amendment, he would, subject to certain alterations, give an undertaking on behalf of the Government to put down an Amendment on the Report stage. I am quite certain that he had every intention of honourably carrying out that pledge, but I understand that certain technical drafting points have arisen which seem to make it difficult to find a suitable form of words. Therefore, as a contribution, and only as a contribution, to the subject of finding the right terms, I have put down my Amendment. I understand that the difficulty is the exclusion of the right already granted or to be granted to Imperial Airways, by which they are to be the sole contractors on certain routes. Obviously, where that has been done, it would not be fair to insist on competition and to call in other people. I do not know whether these particular words meet the case, but I attach some importance to the words at the end of the Amendment, "provided that public notice thereof is given," because if that were done, that, I should have thought, would prevent any possibility of the Air Ministry attempting, in any case highly improbable, to get round the understanding by granting to Imperial Airways some agreement to which they were not really entitled and which ought to be subject to competition.

The Government may say—and I quite appreciate the point—that they have made a new and a very specific declaration that it is their intention to give public notice such as is referred to in my Amendment wherever competition is to take place. I agree that that meets the point now, but it is not statutory, and it may be that in the future the Air Ministry will not be staffed with such a far-sighted statesman as is the case at the present moment. It might be staffed by a man with a more restricted view of their responsibilities, and, as he would be quite entitled to do, he might say that in future they could not give any public notice when a contract was to be made. I hope the Solicitor-General and other hon. Members will assist in the task of finding a form of words which will carry out the undertaking which the Government gave and which I know they are anxious to implement, but if it is not possible to do so, I quite appreciate that it may be necessary to release the Government from their undertaking.


I beg to second the Amendment.

7.24 p.m.


As it is owing to my perhaps over-exuberant observation on the Committee stage that this matter arises, perhaps I ought to explain exactly how the situation stands at present. On the Committee stage the hon. Gentleman who has moved this Amendment moved an Amendment which had two limbs to it. The first was to provide that each agreement made for the payment of a subsidy should be laid before each House of Parliament for a period of not less than 14 days, and that if either House during that period carried an Address against it, it should have no effect. That was the first limb of his Amendment. The second was that the intention of the Secretary of State to consider proposals for an air transportation scheme covering the route involved in the agreement should be publicly advertised and reasonable opportunity given for the presentation of offers on a competitive basis. As regards the first limb of his Amendment, that is to say, the laying of the agreement on the Table of the House and the power of the House to annul it, no specific undertaking was given. All that I said was that it would be looked into; but, as regards the second limb, it divided into two parts by me, and what I said was that the Government could not accept the final part dealing with the presentation of offers on a competitive basis. I will quote my exact words. I said: My right hon. Friend is not prepared at the moment to accept the words in the second part of the Amendment. The hon. Member suggests that a reasonable opportunity should be given for the presentation of offers on a competitive basis. We do not wish to incorporate in an Act of Parliament anything that will suggest, even in the remotest degree, that we ever intend to allow this new service to get into the state of competitive chaos which exists in the United States. I made is perfectly clear that we could not accept the latter part of his Amendment, and the same considerations apply to that part of his present Amendment which deals with reasonable opportunity for the presentation of competing offers. I do not recognise any undertaking or any obligation on that question. But I went on to say: We will endeavour to avoid that, and for that reason we do not like the words 'competitive basis' at the end. Subject to that, it is the intention of the Government before the Report stage to frame an Amendment which will carry out the meaning which my hon. Friend intends to attach to the Clause."—[OFFICIAL REPORT, 25th May, 1936; col. 1731; Vol. 312.] That was an undertaking that before the Report stage we would endeavour to put into words as a statutory necessity that the Secretary of State should publish his intention to make proposals. Having given no undertaking to the hon. Gentleman about laying the agreement on the Table, we have now put on the Paper—and it will be moved in an Amendment at a later stage by my right hon. Friend, so that it would not be in order for me to discuss it now—an Amendment providing that every agreement shall be laid on the Table of the House and that the House shall have an opportunity of annulling it, so that we are according the power for which he asks. This is the undertaking that has been given by the Secretary of State in absolutely explicit terms: In order that in future there may be no conceivable ground of grievance or misunderstanding, my Noble Friend proposes that so soon as a decision has been reached in principle that a new service shall he inaugurated or a new route opened up in an area not covered by existing arrangements, publicity shall be given to that decision, whether by announcement in this House or through the medium of the Press, so that all who are or may be interested shall have an equal opportunity of submitting proposals. There has been that absolutely explicit undertaking by the Secretary of State.


For this Government.


It is an undertaking which I do not imagine any Secretary of State in future would consider he was entitled to overlook, but supposing that the danger that the hon. Gentleman pointed out, were to arise, it is met by our acceptance of the first part of the Amendment, because we have provided that he can annul, by an Address of the House, any agreement which is put on the Table. So that we have complete control. If the Secretary of State brings forward an agreement in respect of a route which has not been made public in the way in which the undertaking suggests, all that the hon. Gentleman or anybody has to do is to move to annul the agreement under the powers that will be incorporated in the Bill by the next Amendment on the Paper. I venture to suggest, therefore, that in these circumstances it is unnecessary, in the first instance, for any provision of this kind to be put in an Act of Parliament. It would be merely cumbrous and repeat something that exists.

I recognise that there was this undertaking, but that is not the sole answer I would desire to give. Not only have the Department and the draftsmen been into this matter of implementing this undertaking, but, needless to say, I was sensitive of the undertaking I gave and I have been at some pains to consider whether it was practicable to carry it into effect. I am satisfied that, on the material we have at present, no draftsman could satisfactorily frame an Amendment. Let me explain in a little more detail why that state of affairs exists. At the present time there are agreements under discussion between the Ministry and Imperial Airways. There are drafts in various forms and skeleton proposals; there are understandings, and nothing more. There are also existing agreements and prospective agreements which will be effective if this Bill comes into operation, but may not take effect for some time. These will cover all the different parts of the Empire routes, and until a position has been reached when a new service has been inaugurated or a new route opened up in an area not covered by existing agreements, it will be impossible to draft a Clause which will exclude potential existing arrangements in respect of which there is an honourable undertaking.


Would not the final words of my Amendment meet the point?


I am afraid that the final words are not satisfactory because they deal with Imperial Airways, and there is no agreement with Imperial Airways. There is only an intention to deal with them. There is also at least one agreement with another company, so that that case would not be covered. It would not be satisfactory to incorporate in an. Act of Parliament something which ties the Government down in a way that was very much objected to on the Committee stage as being even a possibility of entering into an agreement with Imperial Airways. It is a possibility, at any rate, that the agreement might not be concluded. I am not saying that it is a practical possibility, but in a technical sense it is a possibility. For these and many other reasons, the limiting words which the hon. Gentleman has put down, no doubt as a result of a conversation he had with me, do not, I think, meet the position. For the reasons that we cannot do it in practice at the present time, that in any case we are, by accepting the first part of the Amendment, doing everything that can reasonably be expected, and that to-day I have reiterated with full responsibility the undertaking which has been given, I hope that the hon. Gentleman will acquit me from my largeness of promise on the last occasion, and will not press his Amendment.


I must confess to some disappointment that it has not been found practicable to frame a form of words which covers this point. If that be so, I cannot dispute it because I am not in a position to suggest words. I fully appreciate that the hon. and learned Gentleman has done his utmost to carry out the promise that he gave and has found it impracticable. He has met me on the other point where no other promise was made, and, while there is no question of any bargaining, I believe that he has done his best, and I ant willing to accept the position and ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

7.36 p.m.


I beg to move, in page 2, line 8, to leave out Sub-section (3), and to insert: (3) It shall be a term of every agreement made in pursuance of this section between the Secretary of State and a company that no subsidy shall he payable under the agreement unless such directions (if any) as may be given by the Secretary of State for securing that one or more of the directors of the company shall be a person or persons nominated by the Secretary of State are complied with. (4) A copy of every agreement made in pursuance of this section shall, as soon as may be after the agreement is made, be laid before each House of Parliament and if either House, within fourteen days from the day on which a copy of such an agreement is laid before it, resolves that the agreement he annulled, the agreement shall thenceforth be void, without prejudice, however, to the making of a new agreement. In reckoning any period of fourteen days for the purposes of this sub-section no account shall be taken of any time during which Parliament is dissolved or prorogued, or during which both Houses of Parliament are adjourned for more than four days. The new Sub-section (3) puts in proper statutory form the proposal that has been accepted that the Secretary of State shall be entitled to appoint one or more representatives on the board of any subsidised company. The new Subsection (4) meets the object of the proposal made that subsidy agreements should, after being made, be laid before each House of Parliament for a period of not less than 14 days.

Question, "That the words proposed to be left out stand part of the Bill," put, and negatived.

Question proposed, "That those words be there inserted in the Bill."

7.37 p.m.


I beg to move, as an Amendment to the proposed Amendment, in line 3, to leave out "(if any) as may," and to insert "to."

My proposal is that the Minister should be obliged to nominate a director to the board of any company in receipt of a subsidy rather than that it should be left to his discretion to do so. I would apologise for the fact that the Amendment to the Amendment is not couched in as precise language as it might be.


It does not read.


It does read, but it does not read quite as well as it might have done, for the Clause itself does not read as it is intended to read. I shall, I think, show the right hon. Baronet that, whether he accepts my alteration or not, he will have to make a drastic alteration to his Amendment before it goes on the Statute Book. The Amendment is intended to empower the Minister, if he thinks fit, to nominate one or more directors and to require the company to accept his proposals. He has power under the Amendment to nominate all the directors of the company and the company may be compelled to accept that. It will be necessary for the right hon. Gentleman to make some Amendment to the Amendment because it says, for securing that one or more of the directors of the company shall be a person or persons nominated by the Secretary of State. If he requires that eight directors of Imperial Airways shall be nominated by the Secretary of State, the company will have to accept that proposal. I believe that the reason this mistake was made was that, in drafting this Amendment, the right hon. Gentleman noticed that it was within his discretion to nominate directors and, feeling that he would always be able to avoid the necessity of nominating directors, he was not quite so punctilious in examining the Amendment as he would otherwise have been.

The principle in the Amendment that I am proposing to the Amendment is that, where a subsidy is paid, the Secretary of State shall nominate one or more directors, and that the number shall be proportionate to the size of the board and the company. That is the respect in which the wording of the Amendment to the Amendment is not as precise as it might have been. We have not been encouraged on this side to devote the large amount of time and thought to the drafting of our Amendments that we should have devoted had we found that they are treated with more respect and receptivity by the right hon. Baronet. I do not say that in a personal sense, but I consider that he has not been sufficiently willing to meet sound principles when they have been put forward.


This Amendment is a concession.


This is a concession which the right hon. Baronet gives with one hand and takes away with the other. When we were discussing the Clause we said we wanted to establish the principle of no subsidy without a Government director on the board, and what the right hon. Baronet has given us is an Amendment to give him the power to nominate a director if he thinks fit. We know how that will operate in practice. There will be a small company receiving, say, £20,000 a year subsidy. They will meet at the Air Ministry to discuss the amount, and four or five hard-boiled city men will say, "Of course, you are not going to push a Government director on to us in this case, are you?" and the Minister will say, "I do not think it is necessary because the amount is so small." We do not want to put that power in the hands of the Minister. He has shown himself at every stage of this Bill to be suffering from a prejudice against the State being introduced into civil aviation at all. The least principle he can concede to us is that where a subsidy is paid he must nominate a director.

We have heard in the discussion on new Clauses to-day that companies in receipt of subsidies have not shown their responsibilities to the public in the way that they ought to have done. It has been shown that the largest of the companies in receipt of a subsidy has maintained a policy of non-co-operation bordering on boycott against companies endeavouring to develop civil aviation without the subsidy. What were the two Government directors doing on Imperial Airways when these matters were being discussed? It is not sufficient that the right hon. Gentleman should have the discretion to appoint directors. It is not even sufficient that he should be required to appoint directors. He should be required to appoint them and see that they carry out their job. I suggest, without imputing any personal neglect on the part of any directors of civil aviation companies in receipt of subsidies, that they should be instructed what their duties are, namely, to look after the principle that, if a subsidy is being received by civil aviation companies, the public interest must be put, at any rate, equal to the private interests of the companies.

If the right hon. Gentleman accepts the Amendment to the Amendment, as I hope and believe he will, I trust that he will see that persons of the right type are made directors of these companies. It is no use making it a sort of retired job for military officers. I make no complaint against the Government directors of Imperial Airways; I have never met them; but I believe they have been appointed principally for the purpose of looking after the strategical factors involved in the development of civil aviation. Let us make certain that in future appointments of directors the Government will appoint men who know something about civil aviation and commerce and will not look upon it as a plum by which some gallant soldier can augment his pension. I hope the Minister will accept this very reasonable proposal on the lines on which he indicated he would accept it during the previous Debate.

7.45 p.m.


We are trying to establish the principle that where the nation gives money the nation ought to have representation, and further to that point arises the character of the representation. We want to get away from the "money-bug" type of directors, the gentleman who is not necessarily an ex-naval or ex-military man, but of the type that is about the City of London, always waiting for a chance to make money. The type of director we want ought to have activity, plus knowledge. I have come in contact with many hon. and right hon. Members in this House, and judging their knowledge by what they say I think, on looking at their directorships, that they are not being paid for what they know, but what they can do. We want to guard against any of this interloping business, against appointments being made on the grounds of friendship or business contacts. We want to put this matter on a purely business basis and to appoint only men who have knowledge of the subject, because we cannot expect to get things done if the people in charge do not know what they are doing. That it what is wrong in so many cases at the present time. The Directory of Directors clearly shows that. If we could get rid of this incubus which is simply sucking the life out of many industrial concerns to-day a great many things would immediately improve. I hope the Under-Secretary will say that he is prepared to grant what we are seeking, in order to leave things more clean, if I may put it that way.

7.48 p.m.


I am afraid that I cannot accept the Amendment of the hon. Member for North Aberdeen (Mr. Garro Jones) which asks for a great deal more than was asked for by the right hon. Member for Stirling and Clackmannan (Mr. Johnston). He did not ask that it should be mandatory upon the Secretary of State to appoint a director, only that he should be entitled to do so. We have gone as far as we could to meet his request and have carried out in detail the undertaking we gave on that occasion, because when my right hon. Friend said that he proposed later to put down an Amendment he said that it must be regarded as non-mandatory and that it would be left to the Secretary of State to exercise his discretion in each case. In my submission it would be absurd to make this mandatory. Many of these are small companies, even if they are limited liability companies at all, consisting of two or three people with only a small amount of capital, and to make it imperative for the Government to nominate a representative on the board of such a company when, possibly, it is to receive only a small amount of subsidy, on one specific occasion, for carrying out a single service, would be so absurd a proposal that it could not be accepted either by this Government or by a Government which took, perhaps, a stronger view about the desirability of having Government representation on the board. Even if this Amendment were accepted the gap would not be stopped, because this Clause deals only with a company. How about a partnership? How about a concern run by only one person with a few aeroplanes? To be logical the Government would have to be empowered to introduce somebody into the partnership. I think the concession which has been made by my right hon. Friend to meet the case put forward by the right hon. Member for Stirling and Clackmannan is a very real one, and will meet that case, and I hope the hon. Gentleman's Amendment will not be accepted.

7.50 p.m.


I can assure the Solicitor-General that we are not prepared to admit that there is the absurdity which he appears to find in this Amendment. The suggestion of the right hon. Member for Stirling and Clackmannan (Mr. Johnston) was tentative in character, and I am sure he would accept this Amendment. The Solicitor-General ought to give better reasons for rejecting it than he has so far put forward. He talks about small companies and about two or three persons working in partnership, and says that it would be ridiculous for the State to insist upon a representative of the public being upon the board in such cases. I would point out that the Under-Secretary's Amendment speaks of "the term of every agreement,"—does not say that the appointment to the board shall be permanent, but that it shall be made in respect of work done or services rendered for which a subsidy is given by the State. If there is any justification for giving a public subsidy the work will be of importance and it will be carried out by companies of some substance, and this argument about little tinpot companies receiving public subsidy is not a reasonable one to put forward. It does not meet the case for the Government to say they have complied with the tentative suggestion put forward by the right hon. Member for Stirling and Clackmannan. We have gone much further in the discussion of this Measure since then. We appreciate the extent to which the Government have given way to criticism and have met the Opposition and other sections of the House, and we feel there is nothing absurd, unreasonable or illogical in asking that this power should be made mandatory rather than left to the discretion of the Minister.

7.54 p.m.


I realise that there is a good deal in what the Solicitor-General said about the hon. Gentleman's Amendment, but is not this a case to be dealt with on the same lines as he dealt with an Amendment of mine, and that is that there should be a declaration of the Government's intention, which would be to a large extent binding. I think we are entitled to ask from the Government an assurance that when they are dealing with companies of a substantial size and with a good deal of capital it is their intention to exercise the power to appoint one or more directors. In the case of the service to South America, for which tenders are now being asked, I should like to know whether the Government have any intention of exercising this power of appointing a director on the board of the company whose tender is accepted. I think we ought to get an assurance from the Government, because otherwise we may be furnishing them with a power which they have not the remotest intention of exercising. If the hon. and learned Gentleman would give us such an assurance it would go a long way to reconciling some of us to his inability to accept the hon. Gentleman's Amendment.

7.56 p.m.


If I may have the leave of the House to speak again I would say that it is the intention of the Ministry, in the case of substantial tenders, to take steps to see that this power, which is permissive, is exercised. That is as far as I can go.


What does that mean? Does it mean that you are accepting the Amendment? Otherwise, while you may be prepared to act justly the next man may not see his way to act as you promise to do.


For the reasons I have given we do not think it would be right for the Government to accept the hon. Gentleman's Amendment, which would force them to appoint a director even when a company was undertaking only a trifling service, in circumstances which might occur only once. But it is the intention of the Government, in the case of substantial companies, and where there is a proper contract, to adopt the provisions contained in the Amendment proposed by the Under-Secretary.


We have had no information from the Government as to the size of the company and the amount of its capital in the cases in which they propose to take action. Can the hon. and learned Gentleman tell us how they will decide what company is large enough and what is too small?


I am afraid I should be out of order if I were to do that.

Question put, "That the words proposed to be left out stand part of the proposed Amendment."

The House divided: Ayes, 159; Noes, 96.

Division No. 252.] AYES. [8.0 p.m.
Acland-Troyte, Lt.-Col. G. J. Guinness, T. L. E. B. Perkins. W. R. D.
Agnew, Lieut.-Comdr. P. G. Gunston, Capt. D. W. Petherick, M.
Aske, Sir R. W. Guy, J. C. M. Pilkington, R.
Atholl, Duchess of Hanbury, Sir C. Porritt, R. W.
Baldwin, Rt. Hon. Stanley Hannah, I. C. Ramsay, Captain A. H. M.
Baldwin-Webb, Col. J. Haslam, H. C. (Horncastle) Ramsbotham. H.
Balfour, Capt. H. H. (Isle of Thanet) Haslam, Sir J. (Bolton) Ramsden, Sir E.
Beaumont, M. W. (Aylesbury) Hellgers, Captain F. F. A. Rathbone, J. R. (Bodmin)
Blindell, Sir J. Hepburn, P. G. T. Buchan- Rayner, Major R. H.
Boulton, W. W. Herbert, Major J. A. (Monmouth) Rickards, G. W. (Skipton)
Bower, Comdr. R. T. Hills, Major Rt. Hon. J. W. (Ripon) Robinson, J. R. (Blackpool)
Braithwaite, Major A. N. Holmes, J. S. Ropner, Colonel L.
Briscoe, Capt. R. G. Hope, Captain Hon. A. O. J. Ross Taylor. W. (Woodbridge)
Brown, Rt. Hon. E. (Leith) Horsbrugh, Florence Rothschild, J. A. de
Bull, B. B. Hudson, Capt. A. U. M. (Hack., N.) Ruggles-Brise, Colonel Sir E. A.
Campbell, Sir E. T. Hudson, R. S. (Southport) Russell, S. H. M. (Darwen)
Carver, Major W. H. Inskip, Rt. Hon. Sir T. W. H. Sanderson, Sir F. B.
Cayzer, Sir H. R. (Portsmouth, S.) Jackson, Sir H. Sassoon, Rt. Hon. Sir P.
Clarke, F. E. Jarvis, Sir J. J. Savery, Servington
Cook, T. R. A. M. (Norfolk, N.) Jenes, Sir G. W. H. (S'k N'w'gt'n) Seely, Sir H. M.
Cooper, Rt. Hn. A. Duff (W'st'r S.G'gs) Kerr, Colonel C. I. (Montrose) Shaw, Captain W. T. (Forfar)
Craddock, Sir R. H. Lamb, Sir J. Q. Shepperson, Sir E. W.
Cranborne, Viscount Lambert, Rt. Hon. G. Simmonds, O. E.
Crooke, J. S. Latham, Sir P. Simon, Rt. Hon. Sir J. A.
Crookshank, Capt. H. F. C. Leckie, J. A. Sinclair, Rt. Hon. Sir A. (C'thn's)
Crossley, A. C. Leech, Dr. J. W. Sinclair, Col. T. (Queen's U. B'lf'st),
Crowder, J. F. E. Locker-Lampoon, Comdr. O. S. Smithers, Sir W.
Culverwell, C. T. Loftus, P. C. Somervell, Sir D. B. (Crewe)
Davies, Major Sir G. F. (Yeovil) Lyons, A. M. Somerville, A. A. (Windsor)
Dawson, Sir P. Mebane, W. (Huddersfield) Southby, Comdr. A. R. J.
De Chair, S. S. MacAndrew, Colonel Sir C. G. Spears. Brig.-Gen. E. L.
Denman, Hon. R. D. MacDonald, Rt. Hon. M. (Ross) Strauss, H. G. (Norwich)
Dixon, Capt. Rt. Hon. H. McKie, J. H. Strickland, Captain W. F.
Dorman-Smith, Major R. H. Makins, Brig.-Gen. E. Stuart, Hon. J. (Moray and Nairn)
Drewe, C. Mander, G. le M. Sueter, Rear-Admiral Sir M. F.
Duckworth, G. A. V. (Salop) Margesson, Capt. Rt. Hon. H. D. R. Sutcliffe. H.
Duckworth, W. R. (Moss Side) Markham, S. F. Tate, Mavis C.
Dugdale, Major T. L. Maxwell, S. A. Thomas, J. P. L. (Hereford)
Duncan, J. A. L. Mayhew, Lt.-Col. J. Tryon, Major Rt. Hon. G. C.
Dunglass, Lord Meller, Sir R. J. (Mitcham) Wakefield, W. W.
Dunne, P. R. R. Mellor, Sir J. S. P. (Tamworth) Walker-Smith, Sir J.
Eastwood, J. F. Mills, Major J. D. (New Forest) Ward, Lieut.-Col. Sir A. L. (Hull)
Elliot, Rt. Hon. W. E. Mitcheson, Sir G. G. Warrender, Sir V.
Evans, D. O. (Cardigan) Moore-Brabazon, Lt.-Col. J. T. C. Waterhouse. Captain C.
Everard, W. L. Morris-Jones, Dr. J. H. Wedderburn, H. J. S.
Findlay, Sir E. Morrison, G. A. (Scottish Univ's.) White, H. Graham
Fleming, E. L. Morrison, W. S. (Cirencester) Williams. H. G. (Croydon, S.)
Fraser, Capt. Sir I. Munro, P. Withers, Sir J. J.
George, Megan Lloyd (Anglesey) Nall, Sir J. Womersley, Sir W. J.
Glyn, Major Sir R. G. C. Neven-Spence, Maj. B. H. H. Wood, Rt. Hon. Sir Kingsley
Goodman, Cot. A. W. Nicolson, Hon. H. G. Wragg, H.
Gridley, Sir A. B. O'Connor, Sir Terence J.
Grimston, R. V. Orr-Ewing, I. L. TELLERS FOR THE AYES.—
Guest Capt. Rt. Hon. F. E. (Drake) Penny, Sir G. Lieut.-Colonel Llewellin and Mr. Cross.
Adams, D. M. (Poplar, S.) Henderson, J. (Ardwick) Quibell, D. J. K.
Adamson, W. M. Henderson, T. (Tradeston) Richards, R. (Wrexham)
Alexander, Rt. Hon. A. V. (H'lsbr.) Hills, A. (Pontefract) Ritson, J.
Attlee, Rt. Hon. C. R. Holland, A. Roberts, Rt. Hon. F. O. (W. Brom.)
Banfield, J. W. Jagger, J. Rawson, G.
Barnes, A. J. Jenkins, A. (Pontypool) Salter, Dr. A.
Barr, J. Jenkins, Sir W. (Neath) Sexton, T. M.
Batey, J. John, W. Short, A.
Berson, G. Jones, Morgan (Caerphilly) Silkin, L.
Bevan, A. Kelly, W. T. Simpson, F. B.
Brooke, W. Kennedy, Rt. Hon. T. Smith, E. (Stoke)
Burke, W. A. Lathan, G. Smith, Rt. Hon. H. B. Lees- (K'ly)
Charleton, H. C. Lawson, J. J. Smith, T. (Normanton)
Chater, D. Lee, F. Sorensen, R. W.
Cluse, W. S. Leonard, W. Stewart, W. J. (H'ght'n-le-Sp'ng)
Clynes, Rt. Hon. J. R. Leslie, J. R. Strauss, G. R. (Lambeth, N.)
Cocks, F. S. Macdonald. G. (Ince) Taylor, R. J. (Morpeth)
Cove, W. G. McEntee, V. La T. Thorne, W.
Daggar, G. McGhee, H. G. Tinker, J. J.
Dalton, H. McGovern, J. Viant, S. P.
Davies, D. L. (Pontypridd) Mac Laren, A. Walker, J.
Davies, R. J. (Westhoughton) MacMillan, M. (Western Isles) Watkins, F. C.
Dobbie, W. Marklew, E. Watson, W. McL.
Ede, J. C. Marshall, F. Westwood, J.
Edwards, Sir C. (Bedwellty) Mathers, G. Wilkinson, Ellen
Gardner, B. W. Messer, F. Williams, E. J. (Ogmore)
Green, W. H. (Deptford) Montague, F. Williams, T. (Don Valley)
Greenwood, Rt. Hon. A. Naylor, T. E. Wilson, C. H. (Attercliffe)
Grenfell, D. R. Oliver, G. H. Woods, G. S. (Finsbury)
Griffiths, J. (Llanelly) Paling, W. Young, Sir R. (Newton)
Hall, G. H. (Aberdare) Pethick-Lawrence, F. W.
Hall, J. H. (Whitechapel) Potts, J. TELLERS FOR THE NOES.—
Hardle, G. D. Price, M. P. Mr. Whiteley and Mr. Groves.

Proposed words there inserted in the Bill.