BRITISH OVERSEAS AIRWAYS (RE-COMMITTED) BILL.

HC Deb 25 July 1939 vol 350 cc1270-358

Considered in Committee.

[SIR DENNIS HERBERT IN THE CHAIR.]

CLAUSE 1.—[Establishment and constitution of Corporation.)

4.14 p.m.

Lieut.-Colonel Moore-Brabazon

I beg to move, in page 1, line 10, to leave out "British Overseas Airways," and to insert "Air Imperial Routes."

The object of this Amendment is somewhat pretentious. It is in fact to change the title of the corporation which the Bill sets up. The name that I propose is Air Imperial Routes Corporation instead of British Overseas Airways Corporation. The idea of the change of the title at this late stage may seem unusual, but there is a precedent for it. I remember that in 1919, when the Government of the day introduced a Bill setting up a Ministry of Ways and Communications, it was not until quite a late stage in the consideration of the Bill that an Amendment was moved to change the title to "Minisry of Transport," and it was under those conditions that the Ministry of Transport was set up.

The Bill has had a Second Reading and consequently we have given our general assent to it, but there is a feeling that the title is rather cumbersome. These great organisations more and more are known throughout the world by their initials. There is the British Broadcasting Corporation, which is scarcely ever referred to other than by its initials, and we have the K.L.M., the I.C.I, and others. If we are going to stick to the present name we shall have this great English organisation known as B.O.A., and I maintain that that will be a very unfavourable form of initial. It gives one the unpleasant idea of a snakelike organisation, creeping round you and finally crushing you. My proposal is that it should be known as Air Imperial Routes, and the beauty of that suggestion is that you will get the initials A.I.R. I am certain that this great organisation would soon be known throughout the world by the name "Air Corporation." It seems to me that the name is comprehensive, it is short, and it means what it says.

4.17 p.m.

Mr. Eckersley

In supporting the Amendment I only want to point out that to foreign competitors and users of air lines a short title is very much more important than a long title. Anyone who has travelled abroad, particularly in France, will know the familiar words "Air France," and I echo what the right hon. and gallant Member has said that the initials B.O.A. cannot do anything but harm to this new corporation which we all wish to succeed. I am not particularly insistent on the actual words "Air Imperial Routes," but I hope that something will be done to improve what is at present a really frightful title. A.I.R. is almost essential unless some other equally well-sounding initials can be found. If the present name is not changed, I feel that we shall suffer much against competitors with high-sounding names, and I hope that the Secretary of State will do something to change the name before the Report stage.

Sir Hugh Seely

I should like to support the Amendment. The initials B.O.A. are not very nice, and although I do not like A.I.R. I think it is a better name for the corporation which we are hoping will succeed. I trust that the right hon. Gentleman will consider this matter again before the Report stage.

4.19 p.m.

Sir Alfred Beit

The hon. and gallant Member for Wallasey (Lieut.-Colonel Moore-Brabazon) made a suggestion for the Title on the Second Reading. I also made a suggestion for a Title which, I think, is far better, and as he has repeated his suggestion may I be allowed to repeat mine? It is that the corporation should be called "Universal Airways Corporation," or "Royal Airways Corporation." The latter name would have useful initials. I am surprised that none of these suggestions have been adopted so far, but I hope one of them will be.

4.20 p.m.

Mr. Boothby

I do not think the name "British Overseas Airways," has the approval of anyone on any side of the Committee, and I hope that the Secretary of State will reconsider the title before the Report stage. I am not altogether in favour of the Amendment. The title "Air Imperial Routes" is a little better than "British Overseas Airways," but not very much, and I should like the right hon. Gentleman to tell the Committee why he ever gave up the name "Imperial Airways," which is much the best name for this corporation.

4.21 p.m.

Rear-Admiral Sir Murray Sueter

I agree with a great deal of what the hon. and gallant Member for Wallasey (Lieut.-Colonel Moore-Brabazon) has said, but I do not think his title is very much better than the Title in the Bill. "British Overseas Airways" and "Air Imperial Routes" are both cacophonous, and, no doubt, the Air Minister knows the Greek word "caco"—bad, and "phonous"— sound—a bad sound, and that is why I do not like either of these titles. "British Overseas Airways" as a title appeals only to the people of this country, and means nothing to those living in the far distant parts of the Empire. As other hon. Members have made suggestions, may I venture to make one or two? The first is that the corporation should be known as "British Empire Airways" giving you the initials B.E.A., or "British Airways." As a third suggestion why not call it "Royal British Airways," or, fourthly, "British Imperial Airways." I ask the Secretary of State to choose from these names, because I am certain that the present name is the very worst possible. It means everything to have a good crisp name so that when our machines arrive in the Argentine, with the French and German and Italian machines, our nationals out there will say, "Here come the B.A. machines." It is a fine thing to have a good title, and I think you should bring the Empire into it because you have representatives of the Empire on the board, and these machines will fly largely between the different parts of the Empire and carry Empire air mails.

4.24 p.m.

Wing-Commander Wright

I should like to support the suggestion of the hon. and gallant Member who has just spoken that the name should be "British Airways." I feel that if British Airways had not been the name of one of the corporations being amalgamated it was the obvious title, and would have been chosen. It is rather petty and small-minded if such a reason exists for not choosing what is the outstanding and obvious and correct title. I put it to the Secretary of State that if British Airways had been correctly named and had been called "Continental Airways," as it was running Continental routes, he would have had no difficulty when amalgamating these two corporations in arriving at what is, obviously, the correct title— British Airways. It is short and it describes the corporation exactly. It also compares well with "Air France," and I hope the right hon. Gentleman will override what is obviously a very petty and temporary objection, which in a few years will have been forgotten altogether.

4.26 p.m.

Mr. Lees-Smith

I do not think the proposal of the hon. and gallant Member is a correct representation of the new corporation. A large part of the work of the new corporation will be in Europe and across the Atlantic air route, which is not Imperial. Listening to the discussion I am led to the conclusion that "British Airways" would be a better title than "British Overseas Airways." It would avoid those awkward initials, and beyond the fact that this title is already in use, there is no objection to it, and I think that that objection will be forgotten very soon.

Mr. Mander

As we have been told that the whole of the internal airways in this country are to be excluded from the activities of the corporation, therefore the name "British Airways" would certainly not accurately describe the work of the new corporation.

4.27 p.m.

The Secretary of State for Air (Sir Kingsley Wood)

The Committee will agree that I am in some considerable difficulty about this matter. Various suggestions have been made and various names have been put forward. It has been suggested that we should retain the title "British Airways." As a matter of fact, there is some practical difficulty in that respect, and also in using the title "Imperial Airways," because both these names still remain upon the register covering these two companies, and will, in fact, remain there until they go into voluntary liquidation when the transactions under the Bill are completed. Therefore, so far as an immediate decision is concerned, we could not go to Somerset House and register a company in the name of a company already on the list. It might also be a matter of some difficulty if there was a company going into liquidation bearing the name of the new company. I should be only too glad if hon. Members could agree upon a name, and if there is a general consensus of opinion between now and when the Bill goes to another place, I shall be always glad to consider any suggestion. I do not pretend that my own selection of a name is by any means the best, and perhaps we may at some future stage have an informal talk about it.

But let me say a word or two in defence of the title we have chosen. I do not accept the suggestion that, of necessity, the new corporation will be known by its initials. Air France is not, and it is a well known company; and it may be that this new corporation may be known to the world as "British Overseas," which, in fact, is not a bad title, and one which much more accurately describes the purpose of this corporation than any name that has been suggested yet. It describes with absolute accuracy and precision what the corporation stands for. It is world wide. If you want to describe the corporation accurately I think you must rule out the word "Imperial." One can easily criticise the title but the hon. and gallant Member for Wallasey (Lieut.-Colonel Moore-Brabazon) has not criticised the title but its initials. I suggest to the Committee that the name should stand, because I think it may be that the Corporation will not be known by its initials, but will be known as "British Overseas." I hope my hon. Friend will not press the Amendment this afternoon, but will leave the matter in the way I have described. If some hon. Member has a new and brilliant idea in connection with the name of the corporation, on which all hon. Members can agree, no one will be happier than I shall be.

Lieut.-Colonel Moore-Brabazon

In view of my right hon. Friend's statement that it is up to us to agree on a new name for the corporation, and that if we can do so, he will have no objection to our raising the matter on the Report stage, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

4.31 p.m.

Mr. Perkins

I beg to move, in page 1, line 13, after "of," to insert "the Secretary of State for Air."

The object of this Amendment is to clarify the relationship between the new corporation and the House of Commons. I think I am correct in saying that whenever an hon. Member wishes to have a Debate on the British Broadcasting Corporation or to ask a question about it, he is ruled out of order because there is no Minister responsible for it in the House. On the other hand, if an hon. Member wishes to ask a question about the Forestry Commission, the question is allowed, because there is an hon. Member who represents the Forestry Commission in the House. The only opportunity which the House will have of debating civil aviation, as it is affected by the proposed corporation, will be once a year on the Estimates, and as is known by every hon. Member who is interested in the Air Estimates, on that occasion civil aviation is rarely discussed until midnight, or very often one or two o'clock in the morning. In order to make it possible to raise matters that come under the jurisdiction of the corporation, I move this Amendment to include the Secretary of State in the corporation as an ex officio member, so that he would be directly responsible to the House for the actions of the corporation, with the result that it would be possible for hon. Members to put questions on the subject to the Secretary of State.

4-33 P.m.

Mr. Mander

I do not know whether the Amendment is the best way of producing the result which my hon. Friend desires, but I think it is very important that the Bill should be so framed as to permit hon. Members to put questions, in order that the corporation shall be under Parliamentary control. I hope the Minister will deal with that point.

4.34 p.m.

Sir Annesley Somerville

I hope my hon. Friend will not press his Amendment. This Bill commends itself very largely to hon. Members opposite because it is under suspicion of being a Socialistic Bill. As a matter of fact, it has a very strong tinge of Socialism in it, but my hon. Friend wants to be more royalist than the king, and to bring the Secretary of State into the day-to-day administration of the corporation. The Bill gives the corporation a considerable measure of independence, but this Amendment, if adopted, would in fact almost extinguish that independence.

4.35 pm.

Sir K. Wood

The Amendment would, in fact, make the Secretary of State for Air a member of the corporation, and I do not think hon. Members in any part of the Committee would desire that that should be so. To adopt the Amendment would be to place the Secretary of State in an almost impossible position. The members of the corporation will have a collective responsibility for the control of the corporation's affairs and its management, subject to what is laid down in the Act; but the Secretary of State, quite properly and rightly, will be in a very different position. He will have to give directions in accordance with certain powers that are being conferred upon him, and certain things will be subject to his approval; for instance, those matters which concern finance. Therefore, he would be in an impossible position if he was a member of the corporation and at the same time was the person who had to give his approval.

My hon. Friend has another object in mind in moving the Amendment. Quite properly, from his point of view, he wants to secure adequate discussion in Parliament of the affairs of the corporation and a fair and reasonable opportunity, on matters of primary importance, of addressing questions to the Secretary of State. It is not my function to rule what questions could be put to the Secretary of State, but it is, I think, clear that the corporation, in relation to the House of Commons, will be in a very different position from that of the British Broadcasting Corporation. The British Broadcasting Corporation is constituted under a charter, whereas the new corporation is to be constituted under an Act of Parliament, and under that Act very many responsibilities and duties will be placed upon the Secretary of State, concerning finance and other matters. I assume—I do not think there is any doubt about it—that it will be possible to put questions on all those matters to the Secretary of State for Air.

As regards the question of Parliamentary time, of course the mere fact of the Secretary of State being a member of the corporation would not make any further provision of Parliamentary time for discussion of the affairs of the corporation. It may very well be, now that the State is taking a much more active part and making larger financial contributions with regard to Civil Aviation, that some other arrangements will have to be contemplated with regard to discussions of Civil Aviation in the House. That is not a matter on which I can give any undertaking, but I have that in mind, and we shall see how things develop. As to matters concerning the major affairs of the corporation which hon. Members might desire to bring before the House, they would not be in any way debarred from doing so by the way in which this Bill is drafted; in fact, they would be assisted in raising matters, as other important matters can be raised, through our ordinary procedure.

Therefore, while I do not think we want to encourage questions concerning the day-to-day management of the corporation, which would indeed make the administration impossible, I think that, by the provisions of the Bill, we shall in fact secure a very large measure of Parliamentary control, which I believe is all to the good. I suggest to my hon. Friend that, having heard my explanation, he should withdraw the Amendment, and although I know that he put down the Amendment for the purpose of raising the question, I am sure he will recognise that the exact terms in which it is drafted are very undesirable.

4.39 P.m.

Mr. Lees-Smith

I think that the hon. Member for Windsor (Sir A. Somerville) regards hon. Members as being rather more doctrinaire than in fact they are. We might have argued that this new industry should be controlled in the same way as the Post Office or in the same way as London Transport, but I do not think that we would wish to argue that it should be controlled by a rather impracticable mixture of the two. That would be the result of the Amendment. There are certain duties affecting the Secretary of State for Air for which he ought to answer in the House and for which, I think, he will have to answer. As far as the corporation is concerned, it will have other duties to perform, and if the Secretary of State becomes a member of the corporation, he will be only one of 17 members. I do not see how he could possibly be expected to have responsibility before the House with regard to duties in the determination of which he would be so insignificant a minority. Therefore, I do not consider this to be a practicable Amendment.

Mr. Perkins

In view of the Minister's remarks, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

4.41 p.m.

Mr. Garro Jones

I beg to move, in page 2, line 13, at the end, to insert: but such appointment and the terms thereof shall be subject to the approval of the Secretary of State and shall not be for a period longer than five years in any one term of appointment.'' I shall endeavour to emulate the brevity shown by hon. Members who have spoken on the two previous Amendments, and I hope this will not result in the Secretary of State showing any less inclination to meet any valid points which may be raised. The proposal in the Amendment is to make the appointment of the chief executive member of the new corporation and the terms of that appointment a matter for the Secretary of State, in the same way as the appointment of the chairman and deputy-chairman is already made a matter for him under the Bill. It is not intended to interfere in any way with any existing contract of the chief executive. I do not know whether the right hon. Gentleman will feel disposed to tell us what is the present position with regard to Sir John Reith, a matter which gives rise, as everything effecting that gentleman docs, to a great deal of public interest and curiosity. However, I shall not press that matter. Nor is it my intention to secure that in no case shall the chief executive remain in the appointment for a longer period than five years. What is proposed is that he shall first be appointed by the Secretary of State for a period not longer than five years, but that the appointment shall be renewable, within the discretion of the Secretary of State, and that the terms of the appointment shall be laid down by the Minister.

I am well aware that in paragraph 1 of the First Schedule, the Secretary of State has certain powers in regard to altering the period of appointment of a member of the corporation if he should become either chairman, deputy-chairman or chief executive member. There- fore, in that Schedule, it is recognised that there is a certain unity of character between these three officers which requires them to be brought under the particular control of the Secretary of State. What valid reason is there for the Minister surrendering the control of the appointment of chief executive member to the corporation itself? It may be that at some distant time another party will be in office which is not favourable to the right hon. Gentleman's own ideas—I know that seems a strange thing to contemplate in fixing the provisions of this Bill—and there might be appointed to the office of chief executive someone with ideas entirely alien to those held by the right hon. Gentleman the Secretary of State, which would make it impossible to have that close co-operation between the two which is so essential if this scheme is to operate smoothly. Therefore, I hope that the Minister will agree with the proposal I have made, unless he can offer some substantial reason for not doing so.

4.44 p.m.

Sir K. Wood

I am sure the Committee feels indebted to the hon. Member for North Aberdeen (Mr. Garro Jones) for his very clear and concise statement on the Amendment. I want at once to say that, in drafting the Bill, I have not had in mind the consideration which the hon. Member has mentioned; and I may add that I do not contemplate any alteration in the Government of this country for some time to come. There is, however, a real reason why the corporation is permitted, under the structure of the Bill, to appoint its own chief executive member. Having regard to the experimental nature of these proposals we must try to balance the position, as between the State, represented by the Secretary of State for Air, and the members of the corporation who will have to discharge the various duties laid down in the Bill and who will, I hope, bring incentive and endeavour and initiative to the work of the corporation. I think there is a prospect that as a result of this experiment we may succeed in obtaining the advantages of State aid with a certain measure of Parliamentary supervision, while at the same time preserving that natural initiative which is in everybody but is in some people to a greater degree than in others. I am sure that is a principle to which no objection will be taken. What we contemplate is that, as regards the management of the corporation, in such matters, for instance, as the appointment of the chief executive officer, and, later on, in the appointment of officers and staff and workers, the members should be responsible to the corporation itself. We have made a distinction in that respect, in order that they may have a full measure of responsibility in those matters and feel themselves unhampered by any direction from the Secretary of

State, or by requiring the approval of the Secretary of State. That is the actual reason for the distinction which we are making and I commend it to the Committee. I think this is a opportunity for the encouragement of the business or management side of the corporation which I would like to see left as it has been provided for in the terms of the Bill.

Question put, "That those words by there inserted."

The Committee divided" Ayes, 124; Noes,235

Critchley, A,	Keeling, E. H.	Rosbotham, Sir T.
Croft, Brig.-Gen. Sir H. Page	Kellett, Major E. 0.	Ross, Major Sir R. 0. (Londonderry)
Crooke, Sir J. Smedley	Kerr, Colonel C. I. (Montrose)	Ross Taylor, W. (Woodbridge)
Cross, R. H.	Kerr, H. W. (Oldham)	Rowlands, G.
Crossley, A. C.	Kerr, Sir John Graham (Soo'sh Univs.)	Royds, Admiral Sir P. M. R.
Crowder, J. F. E.	Knox, Major-General Sir A. W. F.	Russell, Sir Alexander
Cruddas, Col. B.	Lamb, Sir J. Q.	Russell, R. J. (Eddisbury)
Culverwell, C. T.	Lambert, Rt. Hon. G.	Russell, S. H. M. (Darwen)
Davison, Sir W. H.	Leech, Sir J. W.	Samuel, M. R. A.
De Chair, S. S.	Leighton, Major B. E. P.	Sandeman, Sir N. S.
De la Bè, R.	Lennox-Boyd, A. T. L.	Schuster, Sir G. E.
Denman, Hon. R. D.	Levy, T.	Scott, Lord William
Danville, Alfred	Lewis, o.	Shepperson, Sir E. W.
Donner, P. W.	Liddall, W. S.	Simmonds, 0. E.
Dorman-Smith, Col. Rt. Hon. Sir R. H.	Lipson, D. L.	Smiles, Lieut.-Colonel Sir W. D.
Dower, Lieut.Col. A. V. G.	Little, J.	Smitn, Braoewell (Dulwich)
Drewe, C.	Lloyd, G. W.	Smith, Sir R. W. (Aberdeen)
Duckworth, Arthur (Shrewsbury)	Looker-Lampson, Comdr. 0. S.	Snadden, W. McN.
Dugdale, Captain T. L.	Loftus, P. C.	Somerset, T.
Duggan, H. J.	Lucas, Major Sir J. M.	Somervell, Rt. Hon. Sir Donald
Duncan, J. A. L.	MacAndrew, Colonel Sir C. G.	Somerville, Sir A. A. (Windsor)
Dunglass, Lord	M'Connell, sir J.	Southby, Commander Sir A. R. J.
Eakersley, P. T.	Macdonald, Capt, P. (Isle of Wight)	Stanley, Rt. Hon. Oliver (W'm'l'd)
Ellisten, Capt. G. 8.	McEwen, Capt. J. H. F.	Stewart, J. Henderson (Fife, E.)
Emmott, C. E. G. C.	McKie, J. H.	Stewart, William J. (Belfast, S.)
Emrys-Evans, P. V.	Macmillan, H. (Stooklon-on-Tees)	Strauss, H. G. (Norwich)
Entwistle, Sir C. F.	Macnamara, Lieut.-Colonel J. R. J.	Strickland, Captain W. F.
Errington, E.	Manningham-Buller, Sir M	Stuart, Lord C. Crichton- (N'thw'h)
Erskine-Hill, A. G.	Margesson, Capt. Rt. Hon. H. D. R.	Stuart, Hon. J. (Moray and Nairn)
Everard, Sir William Lindsay	Markham, S. F.	Sueter, Raar-Admiral Sir M. F.
Findlay, Sir E.	Marsden, Commander A.	Sutcliffe, H.
Fleming, E. L.	Maxwell, Hon. S. A.	Taylor, C. S. (Eastbourne)
Fremantle, Sir F. E.	Mellor, Sir J. S. P. (Tamworth)	Thomas, J. P. L.
Furness, S. N.	Mills, Sir F. (Leyton, E.)	Thorneyorott, G. E. P.
Glyn, Major Sir R. G. C.	Mills, Major J. D. (New Forest)	Thornton-Kemsley, C. N.
Graham, Captain A. C. (Wirral)	Mitchell, Sir W. Lane (Streatham)	Train, Sir J.
Granville, E. L.	Moore-Brabazon, Lt.-Col. J. T. C.	Tryon, Major Rt. Hon. G. C.
Gridley, Sir A. B.	Morgan, R. H. (Worcester, Stourbridge)	Tufnell, Lieut.-Commander R. L.
Grigg, Sir E. W. M.	Morris-Jones, Sir Henry	Turton, R. H.
Gritten, W. G. Howard	Morrison, G. A. (Scottish Unlv's.)	Wakefield, W, W.
Guest, Maj.Hon.O. (C'mb'rw'll, N.W)	Morrison, Rt. Hon. W. S. (Cirenaester)	Walker-Smith, Sir J.
Guinness, T. L. E. B.	Muirhead, Lt.-Col. A. J.	Wallace, Capt, Rt. Hon. Euan
Gunston, Capt. Sir 0. W.	Munro, P.	Ward, Lieut.-Col. Sir A. L. (Hull)
Hambro, A. V.	Neven-Spenee, Major B. H. H.	Ward, Irene M. B. (Wallsend)
Hannah, I. C.	O'Connor, Sir Terenee J.	Wardlaw-Milne, Sir J. S.
Harbord, Sir A.	O'Neill, Rt. Hon. Sir Hugh	Warrender, Sir V.
Haslam, Henry (Horncastle)	Palmer, G. E. H.	Waterhouse, Captain C.
Haslam, Sir J, (Bolton)	Peake, 0.	Wayland, Sir W. A
Hely-Hutchinson, M. R.	Peat, C. U.	Wells, Sir Sydney
Heneage, Lieut.Colonel A. P.	Petheriok, M.	Whiteley, Major J. P. (Buckingham)
Hepburn, P. G. T. Buahan-	Pickthorn, K. W. M.	Wlokham, Lt.-Col. E. T. R.
Hepworth, J.	Pilkington, R.	Wilson, Lt.-Col. Sir A. T (Hitehin)
Higgs, W. F.	Ponsonby, Col. C. E.	Windsor-Clive, Lieut.-Colonel G.
Hoare, Rt. Hon. Sir S.	Porritt, R. W.	Winterton, Rt. Hen. Earl
Holdsworth, H.	Pownall, Lt.-Col. Sir Assheton	Womersley, Sir W. J.
Hopkinson, A.	Procter, Major H. A.	Wood, Rt. Hon. Sir Kingsley
Hore-Belisha, Rt. Hon. L.	Radford, E. A.	Wright, Squadron-Leader J. A. C.
Horsbrugh, Florenoe	Raikes, H. V. A. M.	York, C.
Howitt, Dr. A. B.	Ramsay, Captain A. H. M.	Young, A. S. L. (Partlek)
Hudsom, Capt. A. U. M. (Hack., N.)	Rathbone, J. R. (Bodmin)	TELLERS FOR THE NOES.—
Hunloke, H. P.	Reed, A. C. (Exeter)	Mr. Grimston and Major Sir James Edmondson.
Inskip, Rt. Hon. Sir T. W. H.	Reed, Sir H. 5. (Aylesbury)
Jones, L. (Swaneea W.)	Reid, J. S. C. (Hillhead)

Clause ordered to stand part of the Bill.

CLAUSE 2.—(Functions of Corporation.)

4.56 p.m.

Mr. Perkins

I beg to move, in page 2, line 40, to leave out paragraph (a).

This Amendment and two subsequent Amendments have been put down in order to clarify the position in relation to internal air lines in this country. I understand that negotiations have taken place with internal air operators in this country and there are three specific questions

which I would put to the right hon. Gentleman. First, can this new corporation run internal air lines in this country as now operated? Secondly, has the licensing authority any power or control over the corporation or is the corporation automatically exempt from the control of the licensing authority? Thirdly, what is the position of Railway Air Services? This corporation owns a considerable proportion of the shares—I know they are not paid up—in Railway Air Services and although it might be illegal for the corporation to run internal services in this

country, it might be possible for them to make use of the back-door method provided by their control over Railway Air Services, in order to run those services in this country.

4.59 p.m

The Under-Secretary of State for Air (Captain Harold Balfour)

The effect of these Amendments would be to exclude the corporation altogether from the internal field, and I shall reply to the hon. Gentleman's three questions by dealing, very briefly at this stage, with the general position of internal air lines and Railway Air Services under the Bill. I think this will be convenient to the Committee and may save time in the discussion of subsequent Amendments. In its original form, the corporation had power to run internal lines, but that was a reserved power under Clause 4 and was subject to the special consent of the Secretary of State. Certain negotiations took place with the organisation representing the internal air line operators, who felt that there was not sufficient security in the Bill as originally drafted. They also felt that before the Secretary of State exercised his power under Clause 4, as it then was, there should be an opportunity for those operators to state their objections to the exercise of that power. Therefore, the Select Committee allowed the insertion of a Clause—and I should like to express our gratitude to them for allowing these Clauses to be put in at that stage of the Bill—which makes the running of an internal air line or the conduct of an internal air survey flight subject to Provisional Order procedure, which means that the Secretary of State can only make a Provisional Order and that, if it is objected to, the matter goes to a Committee of Parliament, so that the objectors have an opportunity to be represented by counsel and to put forward their objections to the confirmation of the Order. That was agreed to and considered as adequate by those who felt that their interests were prejudiced in the Bill as it originally stood.

We consider that it is desirable that the corporation should have these wide powers of running internal lines and doing air survey flights, but subject now to this additional safeguard. Indeed, it might be desirable in the future for the corporation, by agreement with the interests running internal lines, to co-operate in the running of such lines. For instance in Clause 4 (3) there is provision for the status quo with Railway Air Services to be maintained, and this was agreed to by all parties. The answer to my hon. Friend's first question, Can the corporation run internal air lines? is Yes, but only subject to Provisional Order procedure. To his second question, Is the corporation above the law or, if these powers were ever exercised, either by agreement without objection or alternatively after confirmation by the Select Committee, would they be subject to the licensing authority? The answer is Yes. That is provided for in Clause 4 (4) and in Clause 7. On the Second Reading I gave an undertaking that we would strengthen the provision. As to the third point with regard to Railway Air Services, Imperial Airways have at present an operational agreement by which they supply the crews and maintain the aircraft. They also have a share interest, which I understand is 20 or 25 per cent. That status quo is to be maintained in the future. There is power for renewal of the agreement in substantially the same form as at present, which means that it could not be extended to any considerable degree but it can be continued.

Mr. Perkins

Might I ask for a little more specific elucidation of Clause 4 (3, b)? It is that power which permits the perpetuation of the existing arrangements with Railway Air Services. The words are that nothing shall prevent the corporation from continuing to carry out any existing arrangements with respect to the operation of air transport services on behalf of that company. This may be internal air services, and the existing arrangements may allow the corporation to carry out the administration of any air line that Railway Air Services may have in operation or may in future inaugurate. Therefore, we may have, by some indirect method, a power under which the corporation could run internal air lines under the guise of an arrangement with Railway Air Services.

Captain Balfour

The position, as I see it, is that the corporation could only be indirectly concerned in the extension of any Railway Air Service activities, assuming that the Secretary of State had assented to that particular action. Also I think it would not happen unless other internal lines had, as it were, left the field and there fore Railway Air Services were able to appear in front of the licensing authority and obtain permission to run those side extensions.

5.5 P.m.

Mr. Montague

These two Amendments seem to me to go further, probably, than the Mover intended. I should imagine that the Provisional Order procedure is a sufficient safeguard in respect of the interests about which he is concerned. It is not only a question of Railway Air Services or any other body operating internal services now. If passed, the Amendments would practically guarantee any possible combination of internal air services a monopoly of the whole country. I see no reason at all why that monopoly should be either granted or allowed for in subsequent developments, and I should imagine that the provisions hereinafter referred to will be sufficient safeguard against any unfair competition with existing interests which must, of course, be considered. I appreciate that point, but the Amendments go much further than that and we must oppose them.

Amendment, by leave, withdrawn.

5.6 p.m.

Sir M. Sueter

I beg to move, in page 3, line 23, after "manufacture," to insert: for the purposes of repair or replacement only. It might be possible to have a sufficient number of spart parts to turn into completed machines. Clause 5 says that the corporation shall not manufacture aircraft. It is simply to ensure that they shall not turn spare parts into completed aircraft.

Sir Reginald Clarry

I should like to reinforce what my hon. and gallant Friend has said. In Clause 5 there are six words which remind one of the Commandments The corporation shall not manufacture aircraft. I think that, as provided for in this Subsection, they are practically given power to do that by accumulating sufficient component parts. The manufacture of special accessories is a highly specialised business, and obviously the capital available to the corporation can be used to better service for the general purposes of the corporation as provided for in the Bill.

The Amendment goes to clarify the Subsection.

5.8 p.m.

Captain Balfour

My hon. and gallant Friends will, perhaps, see another aspect of the question if I explain what the Amendment would entail. The power to manufacture parts of aircraft and aircraft equipment and accessories is deliberately drawn in wide terms, and it forms part of the Section of the Bill which sets out the powers, of the corporation which correspond with the memorandum and articles of association of a commercial company. The exercise of the power to manufacture parts is, however, one of the reserved powers which can only be exercised with the consent of the Secretary of State, and the intention is that those powers shall only be approved to the same extent by the general authority which is given at present to Imperial Airways. For instance, the type of new parts which are manufactured by the company are parts for which there is a small demand and which are hard to obtain. I will give one or two examples—chairs, bunks, lifebelts, thermos-carriers, in regard to which the company has special knowledge, special requirements and special experience; lifebuoys, and general spare parts, such as nuts, bolts and auxiliary mountings. These are just a few. If we accepted the Amendment for the purposes of repair or replacement only, the corporation would in future be excluded from manufacturing those special requirements and, indeed, would be placed in a rather restricted position as regards essential activities. They could not use fully their special knowledge, based on years of experience, of the manufacture of those special requirements and they could not develop their work experimentally in respect of those requirements, nor could they help other aircraft operators stranded in remote parts of the world. I give the assurance again that these powers will only be exercised as reserved powers, and only under general approval, to the extent that they now are.

Amendment, by leave, withdrawn.

Captain Balfour

I beg to move, in page 3, line 23, to leave out the first "aircraft," and to insert "air-frames and of aero-engines." This is a drafting Amendment which obviates the necessity for a definition of aircraft in Clause 44, page 26, line 3, as including air-frames and aero-engines.

Amendment agreed to.

Captain Balfour

I beg to move, in page 4, line 21, after "expedient," to insert: (n) to enter into agreements with the Government of any country. This also is a drafting Amendment. The new paragraph gives power to the corporation to enter into agreements with Governments, a power which, although it is a reserved power under Clause 4 (2), is not at present given by this Clause.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 3.—(Employment in connection with Corporation's services of British goods and personnel.)

Amendment made: In page 4, line 27, after "aircraft," insert "air-frames or aero-engines."—[Captain Balfour.]

5.15 p.m.

Mr. Perkins

I beg to move, in page 4, line 41, after the second "Force," to insert "Royal Air Force Volunteer Reserve."

Under the Bill no one can be employed by the corporation as a pilot unless he has been either in the Auxiliary Air Force or the Air Force Reserve. The object of the Amendment is to increase the scope to the Royal Air Force Volunteer Reserve, the new Reserve which has just been formed.

5.16 p.m.

Captain Balfour

The Amendment is really not necessary, because the object of my hon. Friend is already achieved. The Air Force Reserve includes the Royal Air Force Volunteer Reserve. The King's Order establishing the Royal Air Force Volunteer Reserve ordered that a branch of the Air Force Reserve should be formed, which branch was to be known as the Royal Air Force Volunteer Reserve.

Amendment, by leave, withdrawn.

Captain Balfour

I beg to move, in page 4, line 44, at the end, to add: (3 The provisions of this Section shall have effect as if a British protectorate, any territory in respect of which a mandate of the League of Nations has been accepted by His Majesty and any other territory which is under His Majesty's protection or suzerainty were part of His Majesty's dominions. The definition of His Majesty's Dominions is required only for the purposes of this Clause, and it is, therefore, inserted here and is deleted from the general definition Clause, namely, Clause 44.

Amendment agreed to.

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

5.18 p.m.

Sir W. Lindsay Everard

I am not quite clear about the question of personnel here. There may well be, and indeed there have been, occasions when certain women have qualified as pilots, and it might be in future that women might possibly have to be used in flying Imperial air routes. I can name a number of exceptional navigators among women who have flown long distances with signal success, and it would be rather a pity if we took this far-reaching step, which we might regret in time of war.

5.19 p.m.

Captain Balfour

I think my hon. Friend is under a misapprehension. If he will read Sub-section (2) of this Clause, he will see the provision that pilots and other persons employed in any capacity by the corporation … shall have, or have had, such connection with the Air Force Reserve … as may be so specified. It is only to such an extent and in such cases, and it is for the Secretary of State to direct administratively, what proportion of the personnel should have a Reserve liability, and obviously the Secretary of State would exercise those powers of restraint only after having consulted those who were responsible for the organisation and maintenance of the service and the obtaining of the necessary personnel.

Question, "That the Clause, as amended, stand part of the Bill," put, and agreed to.

CLAUSE 4.—(Approval of Secretary of State required to certain activities.)

Captain Balfour

I beg to move, in page 5, line 15, at the end, to insert: Provided that nothing in paragraph (a) of this Sub-section shall apply in relation to the operation or provision of any service as part of, or in connection with, a trans-Atlantic service, so long as—

1. (a) on an outward journey, no passengers, mails or other freight embarked in the British Islands are disembarked in Eire except by way of transhipment for the purpose of conveyance by air across the Atlantic; and
2. (b) on a homeward journey no pasengers, mails or other freight are embarked in Eire except by way of transhipment after conveyance by air across the Atlantic; and
3. (c) in either case the point of transhipment is one to which there is, at the date of the passing of this Act, no existing air transport service from the British Islands."

This is a Clause that has the effect of requiring the corporation to institute that Provisional Order procedure which I mentioned to the Committee earlier this afternoon, if it wishes to run any service to Eire. The main reason for a corporation service to Eire would be in respect of a Translantic service. The corporation might, for instance, wish to run a land-plane service from some point in England to Eire, where it would tranship its passengers into either a flying boat or an aircraft particularly suitable for the Atlantic crossing; and to require a Provisional Order procedure for such a development would be unduly restrictive and outside the scope of the agreement which has been come to with the internal operating companies, which have agreed that this exclusion should be put before the Committee for approval.

Amendment agreed to.

The Chairman

Does the hon. Member for Duddest on (Mr. Simmonds) desire to move the Amendment standing in his name, to leave out Sub-section (3)?

Mr. Simmonds

Yes, Sir Dennis.

The Chairman

I will allow him to do so subject to the usual reservation as to my declining to put it if I so decide; it deals with the question of Railway Air Services which we have already discussed.

Mr. Simmonds

On a point of Order. It was only cursorily mentioned, and as I had this Amendment on the Paper, I omitted previously to speak on the subject in the belief that you would allow me to. make some few remarks now.

The Chairman

I have called the hon. Member for that purpose, but subject to the reservation I mentioned.

5.23 p.m.

Mr. Simmonds

I beg to move, in page 6, line 4, to leave out Sub-section (3).

We do not like this Sub-section at all and think it should come out, lock, stock, and barrel. It refers to Railway Air Services and would enable the corporation to hold stock, to run these services, and to carry out any arrangement with Railway Air Services by way of the renewal of any existing agreement. I think I may tell the Committee what Railway Air Services is. The railway companies took power to themselves in 1929 to operate air services, but I believe none of them exercised those powers until 1933, when the Great Western Railway commenced running air lines. Apparently they did not find their operation as easy as they anticipated, and in 1934, together with the Southern Railway, the London Midland and Scottish Railway, and the London and North Eastern Railway, they asked Imperial Airways whether they would get them out of their responsibility of operating aircraft services, while at the same time retaining a clear interest in those services and not finding themselves in the position that they did in regard to road services, where they allowed vested interests in road transport to spring up and had to purchase those interests out at a high figure. Therefore, in 1934 there was this arrangement between the four railway companies and Imperial Airways, whereby each of them had one-fifth of the shares in Railway Air Services, and Imperial Airways operated the services for Railway Air Services.

My hon. and gallant Friend the Undersecretary of State, when speaking a few moments ago, seemed to think that because the internal air line operators were content to let this arrangement continue, it was proper that it should continue, but I beg leave to think that there are possibly national considerations which might affect the internal operators. As I understand it, this corporation is being formed to clean up British civil air transport, and it has been put in control of all our overseas air transport. Surely this operation of services for Railway Air Services is part of the bad old days when Imperial Airways thought they had to snatch at every opportunity of flying anywhere and everywhere in order to try and prevent anybody else who was a British citizen or a British company from operating air services or flights; and it seems to me that we are weakening the corporation when we allow or encourage it to continue what is virtually a footling part of its duties, operating a few odd services in this country for the railway companies. Why cannot this personnel that to-day operates these services be passed over to the railway companies to be responsible to the railway companies and to the directors of Railway Air Services, who are, with the exception of the Imperial Airways representatives, directors of the railway companies themselves? It seems to me that possibly this has just gone over, with the whole of the assets of Imperial Airways, and possibly my right hon. Friend the Secretary of State for Air has not had sufficiently brought home to him the fact that we want to stop this corporation trying to do too many things. If it would only make a success of one or two things, particularly the operation of overseas air services and the Transatlantic services, it would have achieved something, but here we are going on the bad old lines of encouraging it to do everything badly instead of a few things well.

Mr. Bracken

Does the hon. Member suggest that the railway companies should get out of the aviation business, or that they should take it back from Imperial Airways and conduct it themselves?

Mr. Simmonds

I have tried to make it plain that Railway Air Services is not an aircraft operating company.

Mr. Bracken

It is a holding company.

Mr. Simmonds

Yes, although it does advertise services, and I believe it has some staff of non-flying personnel, but I gather that the machines are owned by Imperial Airways and operated by Imperial Airways staff. My suggestion is that, seeing that there is a company and a board, the railway personnel of that board should carry on the activities of the company, and that it is wholly unnecessary to ask the members of the corporation to waste their time trying to run a few odd air services for the railway companies. I think it is in the national interest that we should try to straighten out this issue, and although I quite understand that it may be too much for my hon. and gallant Friend the Under-Secretary of State to answer now, I shall be much obliged if he would feel it possible to consider the matter before the further stages of the Bill, in which hope I move this Amendment.

5.30 p.m.

Mr. Mander

There may perhaps be something to be said on the question of how far the new corporation should be entrusted with the running of internal air services in this country, including the Railway Air Services, but we ought to be very careful before we lay it down that we want our internal air services handed over to the railway companies, because that is what the suggestion of the hon. Member would mean. I do not think that in their handling of the work so far the railway companies have been at all happy. Their handling of the analogous case of the canals was not at all happy. There are conflicting interests and it would seem to be highly desirable to try to isolate the new internal air services from railway control. How that is to be done, whether by encouraging existing or other internal air companies, or having one unified company for internal purposes, I do not say; but I thought it right to sound a note of warning against the idea that the railway companies are the right people to run the internal air services.

Mr. Simmonds

I would point out that I did not suggest that we should alter the responsibility for air services. Railway Air Services have been given authority by the licensing authority to run internal air lines, and I am not proposing that that position should be ended. All I am saying is that Railway Air Services should not ask the corporation to fly its air services, but should utilise the authority it has from the licensing authority to operate those services itself. My proposal does not bring up the question which was raised by the hon. Member.

Mr. Mander

I venture to think it does.

5.32 p.m.

Mr. Bracken

I have been stirred up to intervene only because of some remarks made by the hon. Member for East Wolverhampton (Mr. Mander). He seems to have a permanent bias against railway companies, and so does the hon. Member for Stroud (Mr. Perkins). The hon. Member for Stroud dislikes Imperial Airways, and, as far as I can see, dislikes every form of transport except yachting. It is a very serious proposition to suggest that the railway companies, which have an enormous amount of capital invested in them, should not be allowed to go into the air transport business if they so desire. I should have thought it would have been a very good thing indeed for them to do so. In years to come people in this country will cease to travel long distances by train and go, instead, by air, and I should have thought the railways, with their experience of transport, had every right to take up air transport. The hon. Member for East Wolverhampton keeps piping up about the canals. Well, canals are like the Liberal party, completely antiquated, and further they are not the subject before the Committee at the present time. I would suggest to the hon. Members on the Socialist Benches that they ought to watch this situation very closely. The railways of this country are, on the whole, excellently managed, and it would be very wrong of this House to put any sort of barrier against their going into the air transport business. We should encourage as much as possible every sort of competition inside this country—I wish we could do the same with the overseas services—and to suggest that we should exclude the railways seems to be the negation of what the hon. Member for East Wolverhampton is always telling us about the rights of democracy.

There are in this country some 200,000 or 300,000 railway shareholders and about 600,000 employes, and the railways, having, so to speak, a charter to engage in air transport, ought not to be kept out of it by reason of the bias of the hon. Member for East Wolverhampton. Was there ever such a suggestion put before Parliament? Sometimes I feel this anti-railway bias to be like anti-Semitism or anti-Jesuitism. It is a very great danger to this country. It is already doing harm to the transport interests of the country. I say here and now that I consider that our railways are just as well managed as any railway system in the world, and I should feel that it was a great disaster if our railway companies were kept out of this new and enterprising form of transport.

5.36 p.m.

Mr. Perkins

I hope that my hon. Friend the Member for North Paddington (Mr. Bracken) realises the position of Railway Air Services and the railway companies. The position at the moment is that the railway companies own Railway Air Services, which, in its turn, owns the greater number of the so-called independent air operators of this country. There are now only three companies which are not under some form of control by the railway companies. Our quarrel with the railway companies is not that they are not trying to run aviation but that they are not trying to run it wholeheartedly. They are stepping in to get control and are slowly strangling it, just as they did with the canals.

Mr. Bracken

Does the hon. Member suggest that the railways strangled the canals because of the speed of the canal boat in contrast with the locomotive?

Mr. Perkins

My hon. Friend will remember the canal in my constituency which joins the Severn to the Thames. That was bought by the railway companies and definitely strangled.

Mr. Lathan

Is it not a fact that the railway air services have during the last three years been doubled or trebled?

Mr. Perkins

That may be so. They have to do a certain minimum of operating, otherwise they would get their licence withdrawn by the licensing authorities and would have to stop the services. Hon. Members of all political parties in this House have taken every opportunity of killing civil aviation, and only when hon. Members have objected to Railway Bills have we been able to make some progress.

5.38 p.m.

Captain Balfour

I will not enter into the differences between the hon. Member for East Wolverhampton (Mr. Mander) and the hon. Member for Duddeston (Mr. Simmonds) as to the merits or demerits of railways operating air services, but I should like to put forward this point of view. The hon. Member for Duddeston based his argument on the present position under which Imperial Airways operate Railway Air Services, and suggested that if the corporation were to take over that work it would weaken the ability of the corporation to fulfil its major task. I suggest that none of the arguments put forward to the Committee have shown why Railway Air Services should not be allowed, with the consent of all interested parties, to avail themselves of the corporation's resources for operating air services. Therefore I would submit that if the status quo were not allowed to continue, and Railway Air Services had to be thrown over by the corporation, there would be no guarantee that the railway companies, who are not themselves experienced in air operations, but are willing to hire that operational experience from the corporation, would continue such services. Then there is also the point that at the present time internal aviation is not paying. Those who are in it to-day are hoping that at some time in the future their present expenditure upon its development will be rewarded, but it might well be that they would not be in a position financially, or willing from the point of view of administration and technical direction, to undertake the lines thrown over by Railway Air Services if the present agreement were cancelled, and that might deal a very severe blow to internal aviation prospects in this country. For that reason I would ask the Committee to resist this Amendment.

Mr. Simmonds

After that statement by my hon. and gallant Friend I do not propose to press this Amendment, but I strongly adhere to the point of view which I have put to the Committee.

Amendment, by leave, withdrawn.

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 5.—(Corporation not to manufacture aircraft.)

Amendment made: In page 6, line 35. leave out "aircraft," and insert "air-frames or aero-engines."—[Captain Balfour.]

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

5.41 p.m.

Mr. Montague

I am rising to ask the Committee to delete this Clause, and I would explain that if the Clause were left out we should have in mind the necessity, at a future stage, of an Amendment to bring the question of the manufacture of aircraft under the Provisional Order Procedure. I suggest that that would be a sufficient safeguard for anyone who imagines that it would be in our minds, or in the minds o£ the corporation, immediately to begin the manufacture of aircraft and to set up factories for that purpose. I cannot understand the objections which have been put forward to the proposal to allow the corporation, under the safeguards mentioned to manufacture aircraft. I cannot understand, either, the objection to internal air transport being undertaken by the corporation. Though there are some manifest objections I think those objections could easily be met but I cannot see why it should be suggested that it would be granting them an unfair disadvantage to allow the corporation to manufacture aircraft under present circumstánces.

We are, I imagine, still somewhere near the beginning of civil aviation and its development, and I cannot see why, from the standpoint of private enterprise, civil aviation should be regarded as requiring so much protection. After all the corporation is not the State; it is not a case of restricting State enterprise. I do not want to go into any doctrinaire questions. We have already had our say on the subject of whether it is desirable or not that there should be State enterprise in this business and I do not think we on this side came very badly out of the argument. But this corporation is not State enterprise, it is an enterprise of a public utility character, where the interests are those of private enterprise. If there be any danger of burcacracy in a State enterprise—I say, "if there be —I do not see how such a fear can be entertained in regard to this particular corporation, unless it is asserted that bureaucracy will come to its fruition in respect of the actual work which it is proposed that the new corporation should do. If we feel that the corporation can handle the air transport side of the business effectively I do not see why it should be taken for granted that if they enter upon the manufacture of aircraft all sorts of corruption and inefficiency will arise.

545 P.m.

Mr. David Adams

Earlier this afternoon the Secretary of State expressed the hope that this corporation would display initiative and other high, businesslike qualities. I am certain that we all eagerly reciprocate and re-echo his wish, but it may happen in the process of time that the corporation will be in a position felicitous enough to manufacture aircraft. We are to lay it down specifically that this form of enterprise shall be excluded by Statute, but it is singular, as we have heard to-day, that the corporation are to be allowed to manufacture necessary parts for repairs and replacements; so that manufacture is not excluded, but only the specific manufacture of aircraft.

Under Clause 26, authority is given to the Secretary of State to make grants towards enabling the corporation to become a partner with other overseas companies in operating overseas air services. Might we not find that the corporation becomes united with other bodies who are able to manufacture aircraft? What will then be the position? The corporation will be barred by Statute from doing so, but it will be a partner with other concerns which are able to manufacture aircraft. Nothing in the Clause states that it is not to have association with overseas air services that are manufacturing aircraft. It seems clear that we may be placing this concern in rather a ridiculous position.

I have the view, and I shall not be so modest as the previous speaker and apologise for my outlook with regard to State operations, that whenever a national concern can do better for the State or for itself than private concerns can do, it should be permitted to enter into that activity with the full support of this House. Under Clause 7, we are advised, surplus profits from this concern will be transferred to a revenue account, and when this account reaches certain proportions one half is to be paid to the Exchequer. The Exchequer is therefore becoming a participant in the operations of this concern, and it therefore seems to us that it is nothing but a strange form of reaction resulting from a reactionary outlook which says that this national concern—as it is—is for ever to be debarred from certain forms of activity, and particularly the activity of manufacturing aircraft.

As the previous speaker said, we are just on the very fringe on the operations of overseas transport. A relatively small proportion of our population use this form of transport, but the concern may grow to mighty proportions. It is a singular and interesting coincidence that it is 30 years almost to the day since Bleriot flew the Channel. In that short period of 30 years we have witnessed colossal changes in air transport. May we not expect at a very early date, considering the rapidity with which we are travelling in this matter, that the concern will be of such proportions that we might have to agree, whatever our political predilections may be, that it should have the power to manufacture aircraft? It will be an error on our part to debar the concern from this form of activity.

5.51 p.m.

Sir H. Seely

I confess that on seeing this Clause one liked its extreme brevity and directness. Although one does not want this to be an entirely Socialistic matter, I would point out that the corporation is not a Socialist body. I cannot see why we should lay down in an earlier Clause that the corporation may make parts of an aircraft and yet say that it is never to be allowed to manufacture a complete aircraft. When we come to the Schedule we find that no member of the corporation is to be capable of being elected to the House of Commons. I hope that the corporation is not to consist of clergymen, lunatics and prisoners in gaol. I cannot believe that such people have any interest or understanding of, or know anything about, aircraft at all. I cannot imagine that the corporation, as it is constituted by the Bill, would ever set about manufacturing aircraft, and I do not quite see why we should lay down the principle so definitely, especially as we have agreed that the corporation may manufacture parts of an aircraft.

5.53 P.m.

Sir A. Somerville

The chief objection to allowing the corporation to manufacture aircraft is that it is a body subsidised with State money and would be placed in a position of very great advantage in competing with private firms. It may be said that State Dockyards build ships in competition with private yards, but they build ships of war which are special ships. The State sees to it that the private yards get their complement of ships to build.

Mr. A. V. Alexander

And more.

Sir A. Somerville

If the corporation were allowed to build aircraft, in competition with private firms, the competition would be unfair.

5.54 p.m.

Mr. Lathan

Many Members of the House would regard the reason which has just been given as an argument for permitting rather than for not permitting the corporation to build aircraft. The Bill contemplates that during a certain period the subsidy will be required for the maintenance of the service which is provided for, and hon. Members must not be surprised if suspicion develops in certain quarters about the influence which has been at work in order to get this restriction imposed. There is an air of familiarity about the condition. I would recall the imposition of a similar condition upon the London Passenger Transport Board. Anybody who is aware of the inside history of that board, which is now operating with an efficiency and a measure of satisfaction which are a standing tribute to its application to the public interests, will know that it is hampered and hindered because in the Bill which brought them into being a similar condition was imposed upon the board in regard to the manufacture of its necessary spares and equipment.

Mr. Bracken

This commendation of the London Passenger Transport Board is very interesting. I hope the hon. Member will recommend it to his right hon. Friend the Member for Hillsborough (Mr. Alexander) because the Co-operative Wholesale Society have some kind of complaint that the London Passenger Transport Board is inefficient and is overcharging.

Mr. Lathan

I think I may leave my right hon. Friend to continue the discussion on that matter under more appropriate conditions. If for some time ahead public funds will be required in order to subsidise and thus make possible the continuance of these services, the corporation ought not to be prevented from entering into one aspect of the undertaking which will, at any rate, provide a measure of profit and possibly of revenue. This is a Bill for the development of external air services, which are not being run with any substantial measure of profit, but one section of the aircraft industry which is making a substantial profit is the production side. The corporation ought to have a full right to enter into production services.

5.57 P.m.

Captain Balfour

I would first say in reply to the hon. Member for West Isling- ton (Mr. Montague) that my position in this matter is not doctrinaire, but it will, I hope, find support on all sides of the Committee. It is: Do we or do we not wish the corporation to fulfil its main function with maximum efficiency? I think we are all of one mind in giving an affirmative answer to that question. Then I come to this proposition: Can a body successfully fulfil two functions, the first one of operation and the second of manufacturing for its particular type of operation? I submit that our commercial history shows that what I might call the tied-house form of industry, consisting of a vertical pyramid in which the producer of the raw material is linked to the controller of each process and then to the retailer, has shown many industrial failures. If at some time it is desired to manufacture aircraft by means of State enterprise—I am not arguing whether that may be required in the future or not —the very worst people to be allowed to manufacture aircraft would be the corporation.

Civil aircraft in the next few years will have to find a wide market throughout the world, and the corporation would have only a narrow view of its own particular requirements. Design and production for the corporation will be carried out by firms who are engaged in the manufacture of civil aircraft, but only after the designs have been recommended to the Secretary of State as desirable, first for the corporation and secondly for the overseas world markets which we wish to capture for British civil aviation in the future. The recommending body will be the new Civil Aviation Development Committee. It would be restrictive to the prospects of British civil aviation if the corporation were allowed to use the limited resources which are available in this country for the development of civil aviation, in the manufacture of types for its narrow specification. Rather should we learn the lesson of past years. We can see how Imperial Airways was developed. The building of their own particular types of aircraft may have rendered great service to that company but not a single member of those types has ever been sold in the world's markets.

I think it is far better that we should allow the operational requirements to be met in competition by the aircraft industry of this country. There is one further point. We are going at some time in the future—and I think it is the common wish of the Committee that it should be sooner rather than later—to have a cut in the production of armaments and a surplus productive capacity in this country. Here I see some opportunity for the men who are at present engaged in our aircraft industry, as well as the technical section of the industry, to find a new outlet when the production of arms ceases. If this Amendment were agreed to, and the corporation were allowed to manufacture aircraft, that prospect would be further restricted. For these reasons I would ask the Committee to resist the proposal.

Mr. Montague

Bearing in mind the fact that it is not proposed to do anything of the kind, may I ask the hon. and gallant Gentleman why this is definitely denied as a possibility for the future, whatever the circumstances may be, and yet other things of a similar character are made reserved subjects? Why cannot this be reserved, too?

Division No. 279.]	AYES.	[6.3 p.m.
Acland-Troyte, Lt.-Col. G. J.	Courthope, Col. Rt. Hon. Sir G. L.	Hannah, I. C.
Adams, S. V. T. (Leeds, W.)	Cox, H. B. Trevor	Harbord, Sir A.
Agnew, Lieut.-Comdr. p. G.	Craven-Ellis, W.	Haslam, Henry (Horncastle)
Allen, Col. J. Sandeman (B'knhead)	Critchley, A.	Haslam, Sir J. (Bolton)
Amery, Rt. Hon. L. C. M. S.	Croft, Brig.-Gen. Sir H. Page	Heilgers, Captain F. F. A.
Aske, Sir R. W.	Crooke, Sir J. Smedley	Hely-Huthchnson, M. R.
Assheton, R.	Crookshank, Capl. Rt. Hon. H. F. C.	Heneage, Lieut.-Colonel A. P.
Astor, Viscountess (Plymouth, Sulton)	Cross, R. H.	Hepburn, P. G. T. Buchan-
Balfour, Capt. H. H. (Isle of Thanat)	Crowder, J. F. E.	Hepworth, J.
Baxter, A. Beverley	Cruddas, Col. B.	Higgs, W. F.
Beauchamp, Sir B. C.	Culverwell, C. T.	Holdsworth, H.
Beaumont, Hon. R, E. B. (Perttm'M	Davies, C. (Montgomery)	Hore-Balisha, Rt. Hon. L.
Beechman, N. A.	De la Bè, R.	Howitt, Dr. A. B.
Bernays, R. H.	Denman, Hon. R. D.	Hudson, Capt. A. U. M. (Hack., N.)
Bird, Sir R. B.	Denville, Alfred	Hunloke, H. P.
Blair, Sir R.	Donner, P. W.	Hunter, T.
Boothby, R. J. G.	Dorman-Smith, Col. Rl. Hon. Sir R. H.	Inskip, Rt. Hon. Sir T. W. H.
Bottom, A. C.	Dower, Lieut.-Col. A. V. G.	Jones, L. (Swansea W.)
Bower, Comdr. R. T.	Drewe, C.	Keeling, E. H.
Boyoe, H. Leslie	Duckworth, Arthur (Shrewsbury)	Kerr, Colonel C. I. (Montrose)
Braoken, B.	Dugdale, Captain T. L.	Kerr, H. W. (Oldham)
Bran, Sir W.	Duggan, H. J.	Kerr, Sir John Graham (Sco'sh Univs.)
Brooklobank, Sir Edmund	Danean, J. A. L.	Knox, Major-General Sir A. W. F.
Brooks, H. (Lewisham, W.)	Eastwood, J. F.	Lamb, Sir J. Q.
Brawn, Rt. Hon. E. (Leith)	Eokerley, P. T.	Lambert, Rt. Hon. G.
Browne, A. C. (Belfast, W.)	Emery, J. F.	Leech, Sir J. W.
Bullook, Capt. M.	Emrys-Evans, P. V.	Leighton, Major B. E. P.
Burton, Got. H. W.	Entwistlt, Sir C. F.	Levy, T.
Butcher, H. W.	Erskine-HiII, A. G.	Lewis, O.
Campbell, Sir E. T.	Everard, Sir William Lindsay	Liddall, W. S.
Carver, Major W. H.	Fleming, E. L.	Lipson, D. L.
Cary, R. A.	Fremantle, Sir F. E.	Little, J.
Cayzer, Sir C. W. (City of Chester)	Furness, S. N.	Lloyd, G. W.
Cazalet, Capt. V. A. (Chippenham)	Glyn, Major Sir R. G. C.	Looker-Lampion, Comdr. O. S.
Channen, H.	Gower, Sir R. V.	Loftus, P. C.
Chapman, A. (Rutherglen)	Graham, Captain A. C. (Wirral)	Lucas, Major Sir J. M.
Christie, J. A.	Granville, E. L.	MacAndrew, Colonel Sir C. G.
Clarke, Colonel R. S (E. Grlnstead)	Grldley, Sir A. B.	M'Connell, Sir J.
Clarry, Sir Reginald	Grigg, Sir E. W. M.	MnCorquodale, M. S.
Clydesdale, Marquess of	Grimston, R. V.	MacDonald, Rt. Hon. M. (Ross)
Cobb, Captain E. C. (Preston)	Gritten, W. G. Howard	Maodonald, Capt. P. (Isle of Wight)
Conant, Captain R. J. E.	Guest, Maj.Hon.O. (C'mbrw'll, N.W.)	H.Kie, J. H.
Cook, Sir T. R. A. M. (Norfolk, N.)	Guinness, T. L. E. B.	Macemillan, H. (Stookton-on-Tees)
Cooke, J. O. (Hammersmith, S.)	Gunston, Capt. Sir D. W.	Macnamara, Lieut.-Colonel J. R. J-
Cooper, Rt. Hn. T. M. (E'nburgh, W.)	Hambro, A. V.	Magnay, T.

Captain Balfour

Because this would be something for the corporation to do, whereas the other reserved subjects are, as it were, side issues which the corporation may be required to do. I would repeat that if at some time in the future it is thought by some Government that civil aircraft should be manufactured by the corporation, I hope, for the sake of the aircraft then produced, that such manufacture will be done, if it has to be done by the Government, not by the corporation, but by some separate establishment.

Mr. Montague

Does the hon. and gallant Gentleman mean by that that the community is to have all the side issues? You would allow local authorities to deal with drains, but never with anything that is profitable?

Question put, "That the Clause, as amended, stand part of the Bill."

The Committee divided: Ayes, 241; Noes, 129.

Manningham-Buller, Sir M.	Reed, A. C. (Exeter)	Talker, Sir R. I.
Margesson, Capt. Rt. Hon. H. D. R.	Reed, Sir H. S. (Aylesbury)	Tate, Mavis C.
Markham, S. F.	Reid, J. S. C. (Hillhead)	Taylor, C. S. (Eastbourne)
Marsden, Commander A.	Ropner, Colonel L.	Taylor, Vice-Adm. E. A. (Padd., S.)
Mason, Lt.-Col. Hon. G. K. M.	Rosbotham, Sir T.	Thomas, J. P. L.
Meller, Sir R. J. (Miloham)	Rote, Major Sir R. D. (Londonderry)	Thorneycroft, G. E. P.
Mellor. Sir J. S. P. (Tamworth)	Ross Taylor, W. (Woodbridge)	Thornton-Kemsley, C. N.
Mills, Sir F. (Leyton, E.)	Rowlands, G.	Titchfield, Marquess of
Mills, Major J. D. (New Forest)	Royds, Admiral Sir P. H. R.	Touche, G. C.
Mitchell, H. (Brentford and Chiswiek)	Ruggles-Briss, Colonel Sir E. A.	Train, Sir J.
Mitchell, Sir W. Lane (Streatham)	Russell, Sir Alexander	Tryon, Major Rt. Hon. G. C.
Margins, A. C.	Russell, R. J. (Eddisbury)	Tufnell, Lieut.-Commander R. L.
Morgan, R. H. (Worcester, Stourbridge)	Salman, Sir I.	Torton, R. H.
Morris, O. T. (Cardiff, E.)	Samuel, M. R. A.	Walker-Smith, Sir J.
Morris-Jones, Sir Henry	Sandeman, Sir N. S.	Wallace, Capt. Rt. Hon. Euan
Morrison, G. A. (Scottish Univ's.)	Schuster, Sir G. E.	Ward, Lieut.-Col. Sir A. L. (Hall)
Munro, P.	Scott, Lord William	Ward, Irene M. B. (Wallsend)
Neven-Spenca, Major B. H. H.	Shepperson, Sir E. W.	Wardlaw-Milne, Sir J. S.
O'Connor, Sir Terence J.	Simmonds, O. E.	Warrender, Sir V.
O'Neill, Rt. Hon. Sir Hugh	Smiles, Lieut.-Colonel Sir W. D.	Waterhouse, Captain C.
Palmer, G. E. H.	Smith, Bracewell (Dulwich)	Wayland, Sir W. A
Patrick, C. M.	Smith, Sir R. W. (Aberdeen)	Wells, Sir Sydney
Peaks, O.	Snadden, W. MoN.	Whiteley, Major J. P. (Buckingham)
Put, C. U.	Somerset, T	Williams, Sir H. G. (Croyden, S.)
Perkins, W. R. D.	Somervell, Rt. Hon. Sir Donald	Wilson, Lt.-Col. Sir A. T. (Hitehin)
Petherick, M.	Somerville, Sir A. A. (Windsor)	Windsor-Clive, Lieut.-Colonal Q.
Pickthorn, K. W. M.	South by, Commander Sir A. R. J.	Winterton, Rt. Hen. Earl
Pilkington, R.	Spears, Brigadier-General E. L.	Wemersley, Sir W. J.
Ponsonby, Col. C. E.	Spens, W. P.	Wood, Rt. Hon. Sir Kingsley
Porritt, R. W.	Stanley, Rt. Hon. Oliver (W'm'ld)	Wright, Wing-Commander J. A. C.
Pownall, Lt.-Col. Sir Assheton	Stawart, J. Henderson (Fife, E.)	York, C.
Procter, Major H. A.	Strauss, H. G, (Norwich)	Young, A. S. L. (Partlok)
Radford, E. A.	Strickland, Captain W. F.	TELLERS FOR THE AYES.—
Ramsay, Captain A.: H. M.	Stuart, Lord C. Crichton- (N'thw'h)	Major Sir James Edmondson and Captain McEwen.
Ramsbotham, Rt. Hon. H.	Stuart, Rt. Hon. J. (Moray and Nairn)
Rankin, Sir R.	Sueter, Rear-Admiral Sir M- F.
Rathbone, J. R. (Bodmin)	Suteliffe, H.

NOES.
Adams, D. (Consett)	Green, W. H. (Deptford)	Oliver, G. H.
Adams, D. M. (Poplar, S.)	Greenwood, Rt. Hon. A.	Paling, W.
Adamson, Jennie L. (Dartford)	Grenfell, D. R.	Parker, W.
Alexander, Rt. Hon. A. V. (H'lsbr.)	Griffith, F. Kingsley (M'ddl'sbro, W.)	Parkinson, J. A.
Anderson, F. (Whitehaven)	Griffiths, G. A. (Homsworth)	Pethick-Lawrence, Rt, Hon. F, W.
Banfield, J. W.	Groves, T. E.	Poole, C. C.
Barnes, A. J.	Hall, G. H. (Aberdara)	Price, M. P.
Barr, J.	Hall, J. H. (Whitechapel)	Pritt, D. N.
Batey, J.	Hardie, Agnes	Richards, R. (Wrexham)
Bellenger, F. J.	Harris, Sir P. A.	Riley, B.
Benn, Rt. Hon. W. W.	Harvey, T. E. (Eng. Univ's.)	Ritson, J.
Benson, G.	Hayday, A.	Robinson, W. A. (St. Helens)
Bevan, A.	Henderson, A. (KingswinfordI)	Seely, Sir H. M.
Broad, F. A.	Henderson, J. (Ardwiek)	Sexton, T. M.
Bromfield, W.	Henderson, T. (Tradeston)	Shinwell, E.
Buchanan, G.	Hills, A. (Pontafract)	Silverman, S. S.
Burke, W. A.	Horabin, T. L.	Simpson, F. B.
Cape, T.	Jagger, J.	Sinolair, Rt. Hon. Sir A. (C'thn's)
Charleton, H. C.	Jenkins, A. (Pontypool)	Smith, Ben (Rotherhithe)
Chafer, D.	Johnston, Rt. Hon. T.	Smith, E. (Stoke)
Cluse, W. S.	Jones, Sir H. Haydn (Merioneth)	Smith, Rt. Hon. H. B. Lees- (K'ly)
Cocks, F. S.	Kennedy, Rt. Hon. T.	Smith, T. (Normanten)
Collindridge, F.	Kirby, B. V.	Sorensen, R. W.
Cove, W. G.	Kirkwood, D.	Stephen, C.
Cripps, Hon. Sir Stafford	Lansbury, Rt. Hon. G.	Stewart, W. J. (H'ght'n-le-Sp'ng)
Daggar, G.	Lathan, G.	Strauss, G. R- (Lamboth, N.)
Dalton, H.	Lawson, J. J.	Taylor, R. J. (Morpeth)
Davidson, J. J. (Maryhill)	Lee, F.	Thorne, W.
Davies, R. J. (Westhoughton)	Leonard, W.	Tinker, J. J-
Davies, S. O. (Merthyr)	Leslie, J. R.	Tomlinson, G.
Dabble, W.	Logan, D. G.	Walker, j.
Ede, j. C.	Macdonald, G. (Inee)	Watkins, F. C.
Edwards, Sir C. (Bedwelty)	McEntee, V. La T.	Watson, W. MoL.
Edwards, N. (Caerphilly)	McGhee, H. O	Welsh, J. C.
Evans, D. O. (Cardigan)	Maclean, H.	Westwood, J.
Evans, E. (Univ. of Wales)	MacMillan, M. (Western Isle*)	Whiteley, W. (Blaydon)
Fletcher, Lt.-Comdr. R. T. H.	Mander, G. le M.	Williams, E. J. (Ogmore)
Gallacher, W.	Mathers, G.	Williams, T. (Den Valley)
Gardner, B. W.	Maxton, J.	Windsor, W. (Hall, C.)
Garro Jones, G. M.	Milner, Major J.	Woods, G. S. (Finsbury)
George, Major G. Lloyd (Pembroke)	Montague, F.	Young, Sir R. (Newton)
George, Megan Lloyd (Anglassy)	Morrison, R. C. (Tottenham, N.)	TELLERS FOR THE NOES.—
Gibson, R. (Greeneck)	Naylor, T. E.	Mr. John and Mr. Adamson.
Graham, D. M. (Hamilton)	Noel-Baker, P. J.

CLAUSE 6.—(Control exercisable by Secretary of State during currency of grants or guarantees.)

6.12 p.m.

Mr. Garro Jones

I beg to move, in page 6, to leave out lines 36 to 39.

The Deputy-Chairman (Colonel Clifton Brown)

I notice that the hon. Member has also an Amendment to Clause 21 which appears to be identical with this Amendment, and I think it would perhaps be convenient to discuss the two together.

Mr. Garro Jones

I am grateful to you, Colonel Clifton Brown, for that suggestion, as the same principle is embodied in both Amendments. I venture to think that this proposal is one which is worthy of the careful attention of the Committee. As the Clause stands, when the right hon. Gentleman and the State have succeeded in building up this corporation into a position of great prosperity, so that it no longer needs any further State assistance, it is then to be entitled to turn to the State and say, "Thank you for your kind help; we now wish to have nothing more to do with you." In the first four lines of the Clause the corporation is given the power to derogate from the powers of the right hon. Gentleman as soon as it no longer needs his financial help. The question we want to ask is, what is the reason for the right hon. Gentleman taking powers to influence the policy of the corporation? Surely, it is not exclusively in order to build up the corporation into a strong financial position. The State is giving this corporation vast financial aid, the State is interfering and supervising the operations of this corporation, not because it wants to put it in a strong financial position, but because it wants to build up a powerful instrument of civil aviation for the sake of the trade and prestige and of the transport facilities of the British Empire throughout the world. What possible justification can there be if, before any of these aims are accomplished, but only because the corporation no longer needs the financial assistance of the State, it is entitled to divest itself of any restrictions which the Secretary of State may seek to impose upon it? Looking at the precise words of the Clause, we find that it says: So long as the power of the Secretary of State to make any grant to the corporation under this Act is, or may become, exercisable, or any guarantee given by the Treasury under this Act is in force. the corporation shall not carry out certain activities without the consent of the right hon. Gentleman. But once those conditions no longer apply, they may do so. The Bill says that the power "is, or may become, exercisable." I do not know what "may become exercisable" means. Perhaps the right hon. Gentleman will be good enough to explain whether it is of any importance. After 14 years all powers granted under the Act to the corporation must cease, provided that no guarantee by the State is then in force. We shall find ourselves then in the position that the State may have paid up to £56,000,000 in order to build up the financial strength of this concern, and the Secretary of State will have no power over it. If there is any guarantee still in force, that will be a reason for maintaining the authority of the Secretary of State.

How can the guarantee come to an end? As I understand, only in one of three ways—the money borrowed from the public may have been repaid, or there may have been some reconstruction, under which the money may have been obtained without the guarantee, or the State may have been called upon to fulfil the guarantee owing to default on the part of the corporation. In such a case, that guarantee would not be enforced, under the Bill as it is now worded. Nobody could then say what was the intention of Parliament at the time when the Act was passed. Any judge would merely have to look at the Statute, and he would say that if the guarantee had been implemented and the State had had to refund capital and interest to a defaulting corporation, the guarantee would not be in force.

I know that the right hon. Gentleman thinks that this is a somewhat fantastic conception, or, at any rate, that this state of things is unlikely to arise, but those of us who have been watching the financial operations of Imperial Airways and the extraordinary attitude that the Government have adopted towards them will not be surprised at any proposals that the Secretary of State brings forward in relation to this concern. It is surely wrong that the State, after it has built up this corporation by means of vast sums of money, should give up all influence in these operations when the corporation has reached that desirable financial position. We are not giving this money in order to put the corporation on a secure financial basis, but we are giving it, and passing this Bill, in order that the State shall have a proper voice)n the operations of the corporation.

6.20 p.m.

Sir K. Wood

I would remind the hon. Gentleman, in the first place, that we are dealing with the year 1953, and that a good deal may have happened by then. I cannot visualise how a judge would interpret the Clause dealing with the corporation's guarantee or the action of the Secretary of State in relation to it, but it will be perfectly obvious that if the state of affairs to which the hon. Gentleman referred did arise, Parliament would have to intervene. The simple explanation of the Clause is that the State is making considerable financial contributions every year to this corporation, and when those contributions cease there is no need for the exercise of supervision by the State over the corporation. Quite frankly I would much prefer to see this corporation proceed under ordinary commercial management, if that were possible, to-day. It is simply because the competition of other nations is such that we have been obliged to take steps, which I believe will yet turn out to be successful, that we have this new corporation and this new scheme.

I am holding out no hopes that in 1953 this new corporation will be able to continue unassisted—I hope that it will — but if it is able to go forward unassisted, I see no reason for direct supervision of the kind mentioned in the Bill. Whether the hon. Gentleman and I will be here to see it I do not know, but I assume that before 1953 any Government in office will have to review the position of this corporation. This is an indication, so far as the Government are concerned, that if the position does arrive when Government assistance is no longer needed, there will be no need for the very considerable supervision which in the meantime is to be exercised by the Secretary of State. I suggest that, from a practical point of view, the whole matter will have to be considered by Parliament either in 1953 or before.

6.26 p.m.

Mr. Simmonds

It seems to me that this Clause ties the corporation very tightly to the apron-strings of the Secretary for Air, because the corporation may not do anything that he does not wish them to do and must do all that he wishes them to do. Although I realise that the apron-strings of my right hon. Friend are made of elastic, some of his successors may have apron-strings that are made of iron. When we put the members of the corporation—who may be distinguished gentlemen and not merely ex-governors—under such supervision, I wonder whether the effect will not be that we shall find ourselves unable to get the type of members that we wish to get. I hope my right hon. Friend will do his best to give them as much freedom as possible. Surely the hon. Member who moved the Amendment will agree that it is sufficient that these members are to be appointed by the Secretary of State, so that if they go contrary to his wishes he can dismiss them. He may exercise a great deal of authority over them quietly, which we may know nothing about. I should like to see them have a little liberty, and then, if they kick over the traces, we should hear about it and be able to discuss the matter in this House.

6.28 p.m.

Mr. Bracken

When I first came into the House there was a great deal of discussion about the sugar-beet subsidy. I remember hearing the late Lord Snowden denouncing the subsidy with all his might and hearing several of my hon. Friends on the Socialist Front Bench saying that such subsidies should be brought to an end as soon as possible because they were a wicked ramp, and if a business could not carry on "on its own," it should be shut down. I think that my right hon. Friend has been, in his usual mellow way, a little too genial in answering the arguments which were put forward by the hon. Gentleman who moved the Amendment. He has told us that 14 years hence the taxpayer will still be shovelling out large sums, and that any Minister then may be in the same sort of predicament as he is in now. I take the view that in 14 years' time the public will have got very tired of that sort of thing. It is to me a matter of the greatest regret that the one party which has been completely against subsidies—

Mr. Garro Jones

This party has never expressed any hostility to the granting of subsidies, provided that those subsidies go to building up State services. What we object to are those subsidies which go to building up dividends for private individuals.

Mr. Bracken

That interruption is, if I may say so, rather irrelevant. If the programme of the Socialist party is described accurately by the hon. Gentleman, why is it that when the Socialist party had been bitterly opposing subsidies, particularly the sugar-beet subsidy, they kept those subsidies on when they came into office. [Interruption.] The hon. Gentleman has not the courage of his interruption. I think that the Secretary of State for Air has really not considered this matter. Does he suggest that in 14 years' time it will be necessary to pay large subventions to this new air corporation? If so, that is a most appalling outlook from the point of view of the taxpayers of the country. I take the view that the best possible thing that could happen to the corporation would be that it should make a decent enough profit

Division No. 280.]	AYES.	[6.32 p.m.
Acland-Troyte, Lt.-Col. G. J.	Cooper, Rt. Hn. T. HI. (E'nburgh, W.:	Gunston, Capt. Sir D. W.
Adams, S. V. T. (Leeds, W.)	Courthope, Col. Rt. Hon. Sir G. L.	Hambro, A. V.
Agnew, Lieut.-Comdr. P. G.	Cox, H. B. Trevor	Hannah, I. C.
Allen, Col. J. Sandeman (B'knhead)	Craven-Ellis, W.	Harbord, Sir A.
Amery, Fit. Hon. L. C. M. S.	Critchley, A.	Haslam, Henry (Harneaslle)
Anderson, Rt. Hn. Sir J. (Sc'h Univ's)	Croft, Brig.-Gen. Sir H. Page	Haslam, Sir J. (Bolton)
Aske, Sir R. W.	Crooke, Sir J. Smedlay	Heilgers, Captain F. F. A.
Assheton, R.	Crookshank, Capt. Rt. Hon. H. F. C.	Hely-Hutchinson, M. R.
Balfour, G. (Hampstead)	Cross, R. H.	Heneage, lieut.-Colonel A. P.
Balfour, Capt. H. H. (Isle of Thanet)	Crowder, J. F. E.	Hepworth, J.
Baxter, A. Severity	Cruddas, Col. B.	Higgs, W. F.
Beauchamp, Sir B. C.	Culverwell, C. T.	Hoare, Rt. Hon. Sir S.
Beaumont, Hon. R. E. B. (Portsm'h)	Davies, C. (Montgomery)	Holdsworth, H.
Beechman, N. A.	De la Bè, R.	Hore-Belisha, Rt. Hon. L.
Bernays, R. H.	Denman, Hon. R. O.	Howitt, Dr. A. B.
Bird, Sir R. B.	Denville, Alfred	Hudson, Capt. A. U. M. (Hack., N.)
Blair, Sir R.	Dodd, J. S.	Hume, Sir G. H.
Boothby, ft. J, G.	Donner, P. W.	Hunloke, H. P.
Bossom, A. C.	Dorman-Smith, Col. Rt. Hon. Sir R. H.	Hunter, T.
Bower, Comdr. R. T.	Drewe, C.	Inskip, Rt. Hon. Sir T. W. H.
Boyce, H. Leslie	Duckworth, Arthur (Shrewsbury)	James, Wing-Commander A. W. H.
Brass, Sir W.	Dugdale, Captain T. L.	Jones, L. (Swansea W.)
Broadbridge, Sir G. T.	Duggan, H. J.	Keeling, E. H.
Brocklebank, Sir Edmund	Duncan, J. A. L.	Kerr, Colonel C. I. (Montrose)
Brown, Rt. Hon. E. (Leith)	Eastwood, J. F.	Kerr, H. W. (Oldham)
Browne, A. C. (Belfast, W.)	Edge, Sir W.	Kerr, Sir John Graham (Sco'sh Univs.)
Bullock, Capt. M.	Edmondson, Major Sir J.	Kimball, L.
Burton, Col. H. W.	Ellis, Sir G.	Knox, Major-General Sir A. W. F.
Butcher, H. W.	Emery, J. F.	Lamb, Sir J. Q.
Campbell, Sir E. T.	Emrys'Evans, P. V.	Lambert, Rt. Hon. G.
Carver, Major W. H.	Entwistle, Sir C. F.	Leech, Sir J. W.
Gary, R. A.	Erskine-Hill, A. G.	Leighton, Major B. E. P.
Cayzer, sir C. W. (City of Chester)	Everard, Sir William Lindsay	Levy, T.
Cazalet, Capt. V. A. (Chlppenham)	Fleming, E. L.	Lewis, O.
Chamberlain, Rt. Hn. N. (Edgb't'n)	Fremantle, Sir F. E.	Liddall, W. s.
Channon, H.	Furness, S. N.	Lipson, D. L.
Chapman, A. (Rutherglen)	Glyn, Major Sir R. G. C.	Little, J.
Christie, J. A.	Gower, Sir R. V.	Lloyd, G. W.
Clarke, Colonel R. S. (E. Grinstead)	Graham, Captain A. C. (Wirral)	Locker-Lampson, Comdr. O. S.
Clydesdale, Marquess of	Granville, E. L.	Loftus, P. C.
Cobb, Captain E. C. (Preston)	Gridley, Sir A. B.	MacAndrew, Colonel Sir C. G.
Colville, Rt. Hon. John	Grigg, Sir E. W. M.	M'Connell, Sir J.
Conant, Captain R. J. E.	Grimston, R. V.	McCorquodale, M. S.
Cooke, Sir T. R. A. M. (Norfolk, N.)	Gritten, W. G. Howard	MacDonald, Rt. Hon. M. (Ross)
Cooke, J. D. (Hammersmith, S.)	Guest, Mai. Hon. O. (C'mb'rw'll, N.W.)	Macdonald, Capt. P. (isle of Wight)

to get rid of the Secretary of State, but now to my great dissatisfaction I find that the right hon. Gentleman is envisaging being in charge of this corporation or his successor or his second successor, in 14 years' time. The hon. Member for East Aberdeen (Mr. Boothby), who is a great authority on finance and a man of an optimistic nature, would think it a most charitable thing if, 14 years hence, we were paying this money out to the corporation. I hope that hon. Members are going to take notice of it. We ought to be obliged to the hon. Gentleman the Member for North Aberdeen (Mr. Garro Jones) for raising this issue, which has produced from the Secretary of State the most bleak and pessimistic view of his functions I have ever heard in this House.

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

The Committee divided: Ayes, 242; Noes, 134.

McKie, J. H.	Ramsbotham, Rt. Hon. H.	Sueter, Rear-Admiral Sir M. F.
Macnamara, Lieut-Colonel J. R. J.	Rankin, Sir R.	Tasker, Sir R. I.
Macquisten, F. A.	Rathbone, J. R. (Bodmin)	Tate, Mavis C.
Magnay, T.	Reed, A. C. (Exeter)	Taylor, Vice-Adm. E. A. (Padd., S.)
Maitland, Sir Adam	Reed, Sir H. S. (Aylesbury)	Thomas, J. P. L.
Manningham-Buller, Sir M.	Reid, J. S. C. (Hillhead)	Thorneycroft, G. E. P.
Margesson, Capt. Rt. Hon. H. D, R.	Ropner, Colonel L.	Thornton-Kemsley, C. H.
Markham, S. F.	Rosbotham, Sir T.	Titchfield, Marquess of
Marsden, Commander A.	Ross Taylor, W. (Woodbridge	Touohe, G. C.
Mason, Lt.-Col. Hon. G. K. M.	Rowlands, G.	Train, Sir J.
Medlicott, F.	Royds, Admiral Sir P. M. R.	Tryon, Major Rt. Hon. G. C.
Meller, Sir R. J. (Mitcham)	Ruggles-Brise, Colonel Sir E. A.	Tufnell, Lieut.-Commander R. L.
Mellor, Sir J. S. P. (Tamworth)	Russell, Sir Alexander	Turton, R. H.
Mills, Sir F. (Leyton, E.)	Russell, R. J. (Eddisbury)	Wakefield, W. W.
Mills, Major J. D. (Hew Forest)	Salmon, Sir I.	Walker-Smith, Sir J.
Mitchell, H. (Brentford and Chiswick)	Samuel, M. R. A.	Wallace, Capt. Rt. Hon. Euan
Moreing, A. C.	Sandeman, Sir N. S.	Ward, Lieut.-Col. Sir A. L. (Hull)
Morgan, R. H. (Worcester, Stourbridge)	Schuster, Sir G. E.	Ward, Irene M. B. (Wallsend)
Morris, O. T. (Cardiff, E.)	Scott, Lord William	Wardlaw-Milne, Sir J. S.
Morris-Jones, Sir Henry	Shepperson, Sir E. W.	Warrender, Sir V.
Morrison, G. A. (Scottish Univ't.)	Simmonds, O. E.	Waterhouse. Captain C.
Munro, P.	Smiles, Lieut.-Colonel Sir W. D.	Wayland, Sir W. A.
O'Connor, Sir Terenee J.	Smith, Bracewell (Dulwich)	Wells, Sir Sydney
O'Neill, Rt. Hon. Sir Hugh	Smith, Sir R. W. (Aberdeen)	Whiteley, Major J. P. (Buckingham)
Palmer, G. E. H.	Snadden, W. McN.	Williams, Sir H. G. (Croydon, S.)
Peaks, O.	Somerset. T.	Wilson, Lt.-Col. Sir A. T. (Hitchin
Peal, C. U.	Somervell, Rt. Hon. Sir Donald	Windsor-Clive, Lieut.-Colonel G.
Perkins, W. R. D.	Somerville, Sir A. A. (Windsor)	Winterton, Rt. Hon. Earl
Petherick, M.	Southby, Commander Sir A. R. J.	Womersley, Sir W. J,
Pickthorn, K. W. M.	Spears, Brigadier-General E. L.	Wood, Rt. Hon. Sir Kingsley
Pilkington, R.	Spens, W. P.	Wright, Wing-Commander J. A. C.
Ponsonby, Col. C E.	Stanley, Rt. Hon. Oliver (W'm'ld)	York, C.
Porritt, R. W.	Stewart, J. Henderson (File, E.)	Young, A. S. L. (Partick)
Pownall, Lt.-Col. Sir Assheton	Strauss, H. G. (Norwich)	TELLERS FOR THE AYES.—
Procter, Major H. A.	Strickland, Captain W. F	Captain McEwen and Mr. Buchan-Henburn.
Radford, E. A.	Stuart, Lord C. Crichton- (N'thw'h)
Ramsay, Captain A. H. M.	Stuart, Hon. J. (Moray and Nairn)

NOES.
Adams, D. (Consett)	Graham, D. M. (Hamilton)	Parkinson, J. A.
Adams, O. M, (Poplar, S.)	Green, W. H. (Deptford)	Pethick-Lawrence, Rt. Hon. F. W.
Adamson, Jennie L. (Dartford)	Greenwood, Rt. Hon. A.	Poole, C. C.
Adamson, W. M.	Grenfell. D. R.	Price, M. P.
Alexander, Rt. Hon. A. V. (H'lsbr.)	Griffith, F. Kingsley (M'ddl'sbro, W.)	Pritt, D. N.
Ammon, C. G.	Griffiths, G. A. (Hemsworth)	Richards, R. (Wrexham)
Anderson, F. (Whitehaven)	Groves, T. E.	Riley, B
Banfield, J. W.	Hall, G. H. (Aberdare)	Ritson, J.
Barnes, A. J.	Hall, J. H. (Whitechapel)	Roberts, W. (Cumberland. N.)
Barr, J.	Hardie, Agnes	Robinson, W. A. (St. Helens)
Bartlett, C. V. O.	Harvey, T. E. (Eng. Univ's.)	Seely, Sir H. M.
Batey, J.	Hayday, A.	Sexton. T. M.
Benn, Rt. Hon. W. W.	Henderson, A. (Kingswinford)	Shinwell, E.
Benson, G.	Henderson, J. (Ardwick)	Silverman, S. S.
Bevan, A.	Henderson, T. (Tradeston)	Simpson, F. B.
Broad, F. A.	Hills, A. (Pontefraet)	Sinclair, Rt. Hon. Sir A. (C'thn's)
Bromfield, W.	Horabin, T. L.	Smith, Ben (Rotherhithe)
Buchanan, G.	Jagger, J.	Smith, E. (Stoke)
Burke, W. A.	Jenkins, A. (Pontypool)	Smith, Rt. Hon. H. B. Lees- (K'ly)
Cape, T.	Johnston, Rt. Hon. T.	Smith, T. (Normanton)
Charleton, K. C.	Jones, Sir H. Haydn (Merioneth)	Sorensen, R. W.
Chater, D.	Kennedy, Rt. Hon. T.	Stephen, C.
Cluse, W. S.	Kirkwood, D.	Stewart, W. J. (H'ght'n-le-Sp'ng)
Cocks, F. S.	Lansbury, Rt. Hon. G.	Strauss, G. R. (Lambeth, N.)
Coltindridge, F.	Lathan, G.	Taylor, R. J. (Morpeth)
Cove, W. G.	Lawson, J. J.	Thorne, W.
Cripps, Hon. Sir Stafford	Lee, F.	Tinker, J. J.
Daggar, G.	Leonard, W.	Temlinson, G.
Dalten, H.	Leslie, J. R.	Viant, S. P.
Davidson, J. J. (Maryhill)	Logan, D. G.	Walker, J.
Davies, R. J. (Westhoughton)	Macdonald, G. (ince)	Watkins, F. C.
Davies, S. O. (Merthyr)	McEntee, V. La T.	Watson, W. ML.
Dobbie, W.	McGhee, H. G.	Welsh, J. C.
Ede, J. C.	Maclean, N.	Westwood, J.
Edwards, Sir C. (Bedwelty)	MacMillan, M. (Western Isles)	White, H. Graham
Edwards, N. (Caerphilly)	Mainwaring, W. H.	Whiteley, W. (Blaydon)
Evans, D. O. (Cardigan)	Mander, G. le M.	Williams, E. J. (Ogmore)
Evans, E. (Univ. of Wales)	Maxton, J.	Williams, T. (Don Valley)
Fletcher, Lt.-Comdr. R. T. H.	Milner, Major J.	Wilmot, John
Frankel, D.	Montague, F.	Windsor, W. (Hull, C.)
Gallacher, W.	Morgan, J. (York, W.R., Doncaster)	Woods, G. S. (Finsbury)
Gardner, B. W.	Naylor, T. E.	Young, Sir R. (Newton)
Garro Jones, G. M.	Noel-Baker, P. J.	TELLERS FOR THE NOES.—
George, Major G. Lloyd (Pembroke)	Oliver, G. H.	Mr. John and Mr. Mathers,
George, Megan Lloyd (Anglesey)	Paling, W.
Gibson, R. (Greenock)	Parker, J.

Clause ordered to stand part of the Bill.

Clauses 7 to 9 ordered to stand part of the Bill.

CLAUSE 10.—(Existing contracts with Secretary of State and Postmaster-General.)

Amendment made: In page 9, line 11, leave out "agreement," and insert "contract."—[Sir A". Wood.]

Clause, as amended, ordered to stand part of the Bill.

Clauses 11 and 12 ordered to stand part of the Bill.

CLAUSE 13.—(Borrowing powers of corporation.)

6.42 p.m.

Sir K. Wood

I beg to move, in page 9, line 38, after "the," to insert "whole or any part of the."

This and the following Amendment are really of a drafting nature and are designed to make the Clause in agreement with the terms of the contract entered into with existing companies.

Amendment agreed to.

Further Amendment made: In page 9, line 41, leave out from "companies," to the end of line 2, page 10.—[Sir K. Wood.]

Sir K. Wood

I beg to move, in page 10, line 12, at the end, to insert: "including the repayment of any money temporarily borrowed under Sub-section (z) of this Section for any of the foregoing purposes."

This Amendment is designed specifically to give the corporation power to borrow by the issue of stock for the purpose of repaying temporary loans.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 14.—(Power of corporation to issue stock.)

6.44 p.m.

Sir K. Wood

I beg to move, in page 10, line 22, to leave out paragraph (a), and to insert:

" (a) to fulfil their obligations with respect to the allotment of stock to, or by the direction of, the existing companies in accordance with the purchase agreements; and."

This Amendment is inter-related to the first two Amendments which were moved to Clause 13.

Amendment agreed to.

Sir K. Wood

I beg to move, in page 10, line 29, at the end, to insert "by the issue of stock."

This is a drafting Amendment to make it clear that the corporation can issue stock to raise money which they are empowered to borrow by subvention.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

Clause 15 ordered to stand part of the Bill.

CLAUSE 16.—(Power of Treasury to guarantee stock and temporary loans of the corporation.)

Amendments made:

In page 11, line 19, after "thereof," insert "(hereinafter referred to as the 'Consolidated Fund')."

In line 40, leave out from "Fund," to "the," in line 41.— (Sir K. Wood.]

Clause, as amended, ordered to stand part of the Bill.

Clauses 17 to 21, ordered to stand part of the Bill.

CLAUSE 22.—(Accounts and audit.)

6.46 p.m.

Mr. John Wilmot

I beg to move, in page 13, line 33, at the end, to insert: Provided that such statement of accounts shall include a balance sheet and profit and loss account and particulars as to the salaries and fees (if any) paid to each member of the corporation.'' This Clause deals with accounts and. reports by the auditors. It requires the keeping of proper accounts, and the Secretary of State has power to direct what form the statement of accounts of the corporation and of any subsidiary company shall take. The importance to this House of this provision is that those directions and the wording of this Clause will determine the nature of the information which is given to the House and the public. I want to ask the right hon. Gentleman whether he can give me an undertaking that the accounts will include a balance sheet, a profit and loss account, and will show what the Companies Act requires, the salaries and fees. of members of the board. If he can give me that undertaking, it will not be necessary to proceed with the Amendment.

6.48 p.m.

Sir K. Wood

I should like to give that undertaking. I have power to give directions as to the form of accounts and I will exercise that power in the appropriate manner and at the appropriate time. So far as the remuneration of the members of the corporation is concerned, the hon. Member will recollect that it is for me to fix the remuneration of the members of the corporation. Therefore, any hon. Member can always ascertain the remuneration by putting down a question. I hope that assurance will satisfy the hon. Member.

Mr. Wilmot

On that assurance, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause ordered to stand part of the Bill.

CLAUSE 23 (Annual Report and periodical returns.)

Mr. J. Wilmot

I beg to move, in page 14, line 22, after "returns," to insert: (b) such information with respect to the activities of the corporation not included in the report made to the Secretary of State under Sub-section (1) of this Section. If the right hon. Gentleman can give me the same undertaking on this Amendment, we can dispose of it as speedily as we disposed of the other.

Sir K. Wood

I think I can give a similar undertaking in regard to this Amendment.

Amendment by leave, withdrawn.

Clause ordered to stand part of the Bill.

Clause 24 ordered to stand part of the Bill.

CLAUSE 25—(Further grants by Secretary of State.)

Sir K. Wood

I beg to move, in page 15, line 16, to leave out from "period" to the end of line 17.

The object of this and the two subsequent Amendments is to make provision so that the word "expenditure" shall be used throughout the Clause in the same sense. We therefore propose to insert at the end of the Clause a general definition of the word "expenditure."

Amendment agreed to.

Further Amendments made:

In page 16, line 37, leave out the second "and."

In line 40, at the end, add:

" and (c) the expression ' expenditure,' in relation to any estimate, includes any sum thereby proposed to be set aside or allocated for any purpose."—[Sir K. Wood.]

Clause, as amended, ordered to stand part of the Bill.

Clause 26 ordered to stand part of the Bill.

CLAUSE 27.—(Power of Secretary of State to make grants to certain companies.)

Question proposed, "That the Clause stand part of the Bill."

6.50 p.m.

Mr. Simmonds

I have an Amendment on the Order Paper to leave out paragraph (a), which has not been called.

I should like to ask a question of my right hon. Friend. From paragraph (a) it would appear that before the Secretary of State can make grants to any company other than the corporation that company must satisfy two points, (1) the company must be in receipt of a subsidy payable by the Government of some other country than the United Kingdom and (2) the corporation must own shares or stock in that company. I cannot see that the holding of a few shares or some stock in a company is going to be any great asset to the corporation or any great safeguard to the Secretary of State. Can my right hon. Friend tell us what is achieved by paragraph (a)?

The Deputy-Chairman

I must draw the attention of the hon. Member to the fact that in the Money Resolution a definite subsidy is laid down, and therefore his argument is out of order.

Question put, and agreed to.

Clause 28 ordered to stand part of the Bill.

CLAUSE 29.—(Grants and expenses of providing facilities to be paid out of moneys provided by Parliament.)

6.52 p.m.

Sir K. Wood

I beg to move, in page 20, line 2, after "1938," to insert: or made after the commencement of this Act in pursuance of the said Section one as further amended by this Act. The object of the Amendment is to make it clear that the limitation of the amount of grant covers subsidies whether to the corporation or joint operating companies or the internal operators under the Air Navigation Act.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 30.—(Amendment of s.1of 26 Geo. 5. & 1 Edw. 8 c. 44.)

Amendment made: In page 20, line 16, leave out from the second "the," to the end of line 19, and insert "British Islands, exclusive of Eire."—[Sir K. Wood.]

Clause, as amended, ordered to stand part of the Bill.

Clause 31 ordered to stand part of the Bill.

CLAUSE 32.—(His Majesty's aircraft to have free use and benefit of aerodromes and other facilities.)

6.54 p.m.

Mr. Perkins

I beg to move, in page 21, line 9, to leave out from "aircraft" to "the" in line 10.

The object of this Amendment is to find out what is going to be the position of foreign aircraft landing at an airport which is owned and controlled by the corporation. At the moment there is an international agreement subscribed to by the various aero clubs which allows a member of one aero club to land at the aerodrome of another aero club in a foreign country free of landing fee, provided it leaves the aerodrome within 48 hours. That is of the greatest help to British aeroplanes, but, unfortunately, it works rather unfairly against foreign aeroplanes. When they come to this country they are able to have free landing and free housing for 48 hours, just as we are, but when they land in Palestine or any other aerodrome on the main air routes where the aerodromes are owned and controlled by Imperial Airways they have to pay heavy landing fees. This causes a sense of injustice. If the Clause goes through un-amended it will be impossible to put it right, and this excellent scheme, which is doing much good for flying in Europe and the world, is bound to break down.

6.56 p.m.

Sir W. Lindsay Everard

I should like to reinforce what my hon. Friend has said. We have a great many difficulties to contend with in the Royal Aero Club on this matter. The President of the Federation Aeronautique Internationale when he flies from France can land at Tunis and Algeria without having to pay landing fees, owing to the arrangement that is in force, but when he goes to any British Colony or Dominion he, is charged a very substantial fee at every aerodrome where he lands. That does not create a very good impression among foreigners as to the facilities which the British Empire gives them in the way of civil aviation. I had occasion some years ago to fly from Africa and was forced to land at Gaza in flying from Egypt to Palestine, not because I wanted to do so but because I had to clear Customs. I had a small machine and I was charged £1 landing fee by Imperial Airways. When I objected, they said that it was a fee charged to keep wild beasts off the aerodrome. On this occasion I was able to obtain a refund of my money, which is rather an unusual thing to be able to accomplish in regard to a great corporation. I found that Imperial Airways, without my permission, had been using my own landing ground for a very large machine, and as I had a fox covert near the end of the ground I pointed out that I also had to keep wild animals off the aerodrome. This is a matter of great importance, and I hope the Secretary of State will bear it in mind and see whether anything can be done to deal with it.

6.58 p.m.

Sir K. Wood

I think my hon. Friend who moved the Amendment will appreciate that I cannot accept it because it would make it obligatory to the corporation to afford accommodation free of charge to any aircraft at any aerodrome controlled by them. I do not think anyone would suggest that they ought to do that. However, I appreciate what my hon. Friends have said and I will see whether I have power, as the Bill is now drafted, to direct the corporation to make their facilities available to others at reasonable charges. If I have not that power, then either here or in another place I shall propose that an Amendment be inserted with that object in view. I shall first ascertain whether I have that power, and if not I shall adopt the proposal that I have just made. I think the suggestion of my hon. Friend is a reasonable one and most hon. Members will appreciate it.

Mr. Perkins

In view of that very satisfactory reply, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause ordered to stand part of the Bill.

Clauses 33 and 34 ordered to stand part of the Bill.

CLAUSE 35.—(Members etc. to account for fees.)

Amendment made: In page 22, line 16, leave out "an associated company," and insert: any company with which the corporation has a subsisting agreement for the establishment, maintenance or operation by the company of an air transport service for or in collaboration with the corporation."—[Sir K. Wood.]

Clause, as amended, ordered to stand part of the Bill.

Clauses 36 and 37 ordered to stand part of the Bill.

CLAUSE 38.—(Continuance of compassionate allowances.)

7. P.m.

Mr, Mander

I beg to move, in page 23, line 8, to leave out from "allowance," to the end of line 9.

The object of this Amendment is to ascertain precisely what will be the position after the passing of this Bill of those persons to whom compassionate allowances have been made by one or other of the two companies. I understand from the evidence before the Select Committee that there are only six such cases, and I want to make sure that it will not be possible—I admit it is extremely unlikely—to stop any of these allowances before they terminate in the ordinary way. It would seem from the wording of the Clause, "on the same conditions as previously obtaining," that it was a purely voluntary act and that the corporation might have power to stop them. If the Secretary of State is able to give an assurance that the legal position is watertight, and that there is no option on the part of the directors to interfere with these grants, I shall be satisfied, and will withdraw the Amendment.

7.2 p.m.

Sir K. Wood

The Committee will appreciate the point which the hon. Member has made. There are only a limited number of these cases, and naturally every hon. Member will desire to see that everything is right so far as they are concerned. We have examined the matter since it was discussed in the Select Committee, and I am advised that the Clause is intended to provide that it shall be a matter of legal right under the same conditions as before. There was some discussion whether the words "as before" threw us back on the voluntary allowance, and I understand that is so. But between now and when the Bill is in another place I will have the matter investigated again, and if there is any doubt I will suggest an Amendment.

Mr. Mander

In view of that assurance I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn. Clause ordered to stand part of the Bill.

CLAUSE 39.—(Power of corporation to establish superannuation schemes.)

Sir K. Wood

I beg to move, in page 23, line 10, to leave out "at any time," and to insert "and, if the Secretary of State so directs, shall."

This Amendment and the next two Amendments have been put down to meet the point made by the Select Committee in regard to superannuation. The Select Committee went carefully into this question and expressed the desire that, if possible, the matter should be made more definite, and it should not be left to the corporation of its own volition to set up a fund. I do not think there is any doubt that in fact they would do it, but the point was raised that they might not. Therefore, I have put down these Amendments to meet the point, and as amended the Clause will enable the Secretary of State to direct the corporation to set up a fund or scheme. I can also give this assurance, that if a scheme or fund were not set up I should direct proper superannuation arrangements to be made under the powers I am now taking, and I should certainly use my discretion in the way I have indicated. I think with these Amendments, coupled with the assurance I have given, the rights in regard to superannuation are fully safeguarded.

7.5 P.m.

Mr. Lathan

It is an exhilarating experience to be able to support suggestions made by the right hon. Gentleman. He will appreciate that the recommendations which came from the Select Committee were unanimous, and that the Committee felt that the position in regard to superannuation provisions was not entirely satisfactory. There was no evidence that members of the fund, or even the trustees of the fund, had been consulted. If, as I now gather, the Secretary of State intends to exercise his powers and to ensure that a satisfactory and comprehensive superannuation fund is established, and that the staffs are to be consulted and their wishes ascertained, the Committee will regard that with satisfaction.

Amendment agreed to.

Further Amendments made:

In page 23, line 11, leave out "such."

In line 12, leave out "as they may think fit."—[Sir K. Wood.]

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 40.—(Winding-up and dissolution of existing companies.)

Amendment made: In page 23, line 36, leave out Sub-section (2).—[Sir K. Wood.]

Clause, as amended, ordered to stand part of the Bill.

Clauses 41 and 42 ordered to stand part of the Bill.

CLAUSE 43.—(Exemption from stamp duties.)

7.7 p.m.

Sir K. Wood

I beg to move, in page 25, line 22, to leave out from "for," to the end of the Clause, and to insert: the allotment of any stock the purchase price of which is under the purchase agreements to be set off against the consideration payable there under, or for the purpose of raising money to provide that consideration so far as there is no such set-off as aforesaid, or to provide the working capital necessary for the initial requirements of the corporation, or to repay money temporarily borrowed for either of those purposes; or

(d) on any security given by the corporation in respect of money temporarily borrowed under Sub-section (2) of Section thirteen of this Act and certified by the Secretary of State, with the approval of the Treasury, to be required for any purpose specified in the last preceding paragraph. This Amendment is inserted because of the alteration necessitated by the terms of the contract at the end of the Bill, and we have to make the Clause agree with the contract, which was omitted from the original draft.

Amendment agreed to. Clause, as amended, ordered to stand part of the Bill.

CLAUSE 44.—(Interpretation.)

Sir K. Wood

I beg to move, in page 26, to leave out line 3.

This Amendment is necessary because the Committee a short time earlier inserted in Clause 2 the words "air-frames and of aero-engines," and there is, therefore, no need to have this in the definition Clause.

Amendment agreed to.

Sir K. Wood

I beg to move, in page '26, line 11, at the end, to insert "'British Islands' means those Islands, exclusive of Eire."

This is a new definition, and it is necessary to make it clear that for the purposes of this Bill "British Islands" means the United Kingdom, the Channel Islands, and the Isle of man, but not Eire.

Amendment agreed to.

Sir K. Wood

I beg to move, in page 26, to leave out lines 12 to 17.

It has been proposed to insert these words in Clause 35, because that is the only place in the Bill where the expression is used.

Amendment agreed to.

Sir K. Wood

I beg to move, in page 26, line 21, after "Dominion," to insert "British India, British Burma."

The definition of a country is intended to cover every country in the world, and it has been pointed out that this does not include British India and British Burma, which the Amendment is designed to correct.

Amendment agreed to.

Sir K. Wood

I beg to move, in page 26, line 25, at the end, to insert: and, in relation to a part of a country which is under both a provincial and a central Government, any reference in this Act to the Government of a country shall be construed as including a reference to either of those Governments. This Amendment is on the same lines. It is intended to make it clear that the definition includes both central and provincial governments.

Amendment agreed to.

Sir K. Wood

I beg to move, in page 26, to leave out lines 36 to 41.

The reason is that these words are required only for the purpose of Clause 3, and we have already transferred the definition to that Clause.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

Clause 45 ordered to stand part of the Bill.

NEW CLAUSE.—(Collective representation of staff.)

In determining the wages and conditions of employment of persons employed by the corporation, the corporation shall take into account representations made to them by any body or organisation the membership of which comprises a substantial proportion of the class or classes of employés concerned.— [Sir K. Wood.]

Brought up, and read the First time.

Sir K. Wood

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

This is in order to meet a point made by the Select Committee when they examined the Bill. They expressed the opinion that the question of representation should be further considered with a view of embodying a more specific provision in the Bill. This is a provision which I fully approve, and I would remind the Committee that, so far as the staff are concerned, it is my wish and desire, which I have no doubt the corporation will fully respect, that there should be proper and adequate machinery for consultation on all matters connected with their employment. This new Clause and the undertaking I have already given will ensure that the rights of the staff of the corporation will be fully protected so far as discussions are concerned, and that there will be suitable machinery by which conditions of employment can be discussed between the staff and the corporation. We remember what took place a short time ago, and we are looking forward, as a result of these provisions, to very satisfactory arrangements being made and a good atmosphere being obtained so far as the corporation and their employés are concerned.

7.17 p.m.

Mr. Lathan

Members of the Select Committee and this Committee generally will regard the statement of the Secretary of State as satisfactory. The feeling of the Select Committee was that in this matter, as in the matter of superannuation, the situation was not at all happy, and it was desired that arrangements should be made under which representatives of organisations who spoke on behalf of the staff should be fully and freely recognised. We understand that the new Clause intends that there shall be full and complete recognition of the trade unions and other organisations acting for the various sections of the staff, but I should like the Secretary of State to say whether not only those who are in receipt of wages, but also those who are members of the salaried staff are included in these proposals? Does it apply to all sections of the staff, clerical and administrative, as well as operatives and constructive grades who are paid by a weekly wage? If that is the case I think we may say that the arrangements are generally satisfactory.

7.19 p.m.

Marquess of Clydesdale

May I add my voice to the general satisfaction that has been expressed at the fact that the Secretary of State has seen his way to include this new Clause in the Bill and also to give the undertaking he did on a former Amendment? I think it is extremely satisfactory. This new Clause ranges over a wide field. I am, personally, interested in the pilots' point of view, because I am a member of the Air Line Pilots' Association. After all, a professional pilot is even now a comparatively new profession, and the conditions under which he is employed necessitate. I think, that pilots as a body should be recognised and that their representatives should be recognised. That, I think, is of the greatest importance. The Secretary of State has referred to somewhat unhappy recollections, but the position is now better, and in Sir John Reith and Mr. Runciman we have two gentlemen in whom the pilots have complete confidence. Although the present position is satisfactory, I think it is right that the pilots should have sufficient safeguards. That is what we want, and on behalf of the pilots I want to thank the Secretary of State for Air for having proposed this new Clause and given the undertaking to which he has referred.

7.21 p.m.

Mr. Mander

It seems to me that this new Clause meets to the full in the letter and in the spirit the recommendations made unanimously by the Select Committee, and if it is carried out on those lines it will be satisfactory. We are setting a very valuable precedent for future Measures of this kind. I do think something of this kind is required, because I was not impressed by the way in which Imperial Airways and British Airways dealt with their employés. No consultations took place with the staff, nor was any information given them as to what their position might be in the future. No doubt it was felt that their position would be strengthened, and that there was no need to do so, but at the same time people like to be consulted. This new Clause will make it certain that such consultations will take place, and I should like to thank the Secretary of State for having proposed it.

Mr. Perkins

I should also like to thank the right hon. Gentleman for proposing this new Clause. This subject has been a bone of contention for some time, but I am happy to think that it has now been satisfactorily settled.

7.23 p.m.

Mr. Poole

I am sure that we on this side of the Committee are pleased to see in any legislation provision for the recognition of trade unions or other associations. Many of us wish it had been introduced into our legislation in the past. I am concernedonly with one phrase in the new Clause, and that is "a substantial proportion." I am wondering what interpretation will be given to that phrase. I visualise a provision where, perhaps, 80 per cent, of the employés of the new corporation are members of a trade union, but in which only a small minority of one section of the employés, the clerical workers, are inside that organisation. Will it be possible to deny to these men the right of representation through their own organisation because a substantial proportion of the clerical staff are members of a trade union? I think it would have been better if this phrase had been left out and that there had been a free right to any organisation which represents a body of people employed by the corporation to be received and their representations heard. Unless the new Clause is interpreted in the spirit in which we desire it should be interpreted, there is a danger that one small section of the employés may find themselves denied a right which should be given to them, that is, the right of representation and the hearing of their case

Sir A. Somerville

As a member of the Select Committee I wish to add my word of satisfaction that the Secretary of State has so fully met the unanimous wishes of the Select Committee.

Question put, and agreed to. Clause read a Second time, and added to the Bill.

NEW CLAUSE.—(Pensions and sickness benefit.)

The corporation shall establish pensions and sickness benefits for all persons employed by the corporation who may be killed or injured during employment by the corporation and for their dependants.—[Mr. Perkins.]

Brought up, and read the First time.

7.26 p.m.

Mr. Perkins

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

There have been a small number of cases of old pilots in which questions have arisen as regards their insurance and benefits. There have been a few really hard cases, and I know that the Undersecretary is aware of one or two. I am glad to say that the situation is now very much better, but as there are still one or two hard cases I am moving the new Clause in order to prevent any recurrence.

Sir K. Wood

I am advised that the Amendment we have passed in regard to the establishment of a pensions and superannuation fund will meet the point made by the hon. Member and, as he knows, I have given an undertaking that if the corporation do not establish such a fund I shall direct them to do so. In the circumstances I would suggest that he does not press the new Clause.

Motion and Clause, by leave, withdrawn.

FIRST SHEDULE.—(Supplementary provisions as to the corporation.)

7.28 p.m.

Mr. Boothby

I beg to move, in page 28, line 25, to leave out paragraph 4.

The Deputy-Chairman

Perhaps it would be convenient to the Committee to discuss on this Amendment the Amendment in the name of the hon. Member for Stroud (Mr. Perkins)—in line 26, after "Commons," insert "or House of Peers"—as it seems to cover the same point.

Mr. Boothby

This Amendment raises a principle of some importance. We are now establishing another public corporation under an Act of Parliament, and we may be quite sure of one thing, and that is that this is not the last public corporation which will be established in this country. We are obviously at the beginning of a period when more and more of these semi-public corporations will be established, and I think that the position of hon. Members of this House will have to be clarified one way or another, sooner or later. The paragraph which I am proposing to delete has been put in, I believe, simply in order to conform to a principle laid down some time ago in respect to a Member of Parliament appointed to a Parliamentary office of profit under the Crown. I submit that that is a very doubtful interpretation, and I think the Committee will have to face the issue. We have to recognise that railway companies, shipping companies, big banks, the co-operative society, the coal industry, the trade unions and the iron and steel industry have their representatives in this House, not in the absolutely strict sense, but in the sense that there are Members who can claim to speak on behalf of these great industries, and if we are to exclude Members of Parliament from serving on the boards of these public corporations it seems to me that we are taking a grave step indeed which may not be conducive to the public interest. I say that if there had been a Member of Parliament, or even two Members of Parliament, on the board of the old Imperial Airways Company the trouble which arose a year or more ago would never have arisen, because hon. Members on all sides could have established direct contact immediately and found out the true facts of the situation. What struck me as being most significant about the whole row was the total lack of touch between the Board of Imperial Airways and hon. Members on both sides. This provision deliberately makes certain that there shall be no direct contact of any kind between the corporation and hon. Members. I think that is a very bad precedent to create.

With regard to the Amendment in the name of my hon. Friend the Member for Stroud (Mr. Perkins), if we are to exclude Members of Parliament, let us also exclude Members of another place. I am sure my right hon. Friend will agree with me that if we are to establish the principle that in these public and semi-public corporations no members of the board shall be Members of Parliament, that ought to apply to Members of both Houses of Parliament. I ask my. right hon. Friend why he has thought fit to introduce this paragraph, which I do not believe is a desirable precedent, and which I do not believe, in the long run, will conduce to the general public interests.

7.31 p.m.

Mr. Perkins

As this Amendment and the Amendment on the Paper in my name are benig discussed together, I would point out that I put down my Amendment for the purpose of finding out, if possible, why Members of Parliament should be excluded while Members of another place are included. It seems to me that either all should be in or all should be out, and deliberately to distinguish between the sheep and the goats seems to me to be rather a slight on the House of Commons, and to suggest that hon. Members are in some way inferior to Members of another place.

7.32 p.m.

Sir K. Wood

I appreciate the observations made by my hon. Friend the Member for East Aberdeen (Mr. Boothby), although I must confess that I do not think the illustration he gave with regard to the position of the staff of Imperial Airways and the controversy that arose was a very good one. I do not wish to pass judgment on that case, but I should say that the real trouble was that the people responsible for the management were not in touch with the staff as they might have been. However, simply because things do not go right with the staff in a company of that kind, I do not see that it is the duty of Members of Parliament to get in touch with the staff, or with those who sit on the board, in order to be able to put matters right between the House and the company. I always regretted that matter, and when I became Secretary of State I regarded it as one that should be settled by the company itself and not as a matter for discussion in the House. I do not accept the argument that because of that unfortunate case, Members of Parliament ought to be directors of this corporation.

I submit that, on balance, it is a wise decision that Members of the House should not be on the boards of corporations of this nature. There are, of course, numerous precedents for this particular provision. There are the precedents of the London Passenger Transport Act, the Sugar Industry (Re-organisation) Act, the Electricity Supply Act, the Coal Mines Act, the Livestock Industry Act, the Sea Fish Industry Act; and my right hon. Friend the President of the Board of Trade has just told me that in the Cotton Industry (Re-organisation) Bill a similar Clause has been passed by the House without opposition. I think there is good reason for such a provision. Although I have often thought that Members of Parliament would be very valuable members of corporations and boards of this character, I think that, on the whole, it is desirable that Parliament should lay down that the same individual should not be at the same time a member of the body which controls the granting of public funds, either itself or through the Secretary of State, for the purposes of the corporation, and also a nominee of the Secretary of State on that particular corporation. That, in fact, is what would happen if this provision were deleted. I should then be free to appoint a Member of the House or two Members, that is to say from the very people who, in fact, are in a large measure controlling, either themselves or through me, the finances of the corporation. I doubt very much whether it would be wise for hon. Members to find themselves in such a position. It might very well be argued that membership of a corporation of this character, which is a very extensive one as far as the State is concerned, might be an office of profit within the meaning of the Section.

Mr. Boothby

Would not that argument also apply to all industries which are in receipt of a direct subsidy from the State?

Sir K. Wood

I would not like to argue on a case that is not before me, but with regard to this corporation, which is to have very considerable State assistance, there are very large financial commitments by the State through money voted by Members of the House. I am sure that, on reflection, my hon. Friend the Member for East Aberdeen will see that there is great force in the argument that, in such a case, Members of Parliament should not be entitled to be members of the corporation. With regard to the point made by my hon. Friend the Member for Stroud (Mr. Perkins), I would remind the Committee that this distinction has been made in every case. Members of another place are not, of course, concerned with finance. That is a very considerable difference between their position and the position of hon. Members of this House. A peer who is actively engaged in politics may be made a governor of a Colony whereas a Member of Parliament who is made a governor of a Colony has to resign his seat. The position is the same with regard to Ambassadors to foreign Powers. That distinction has constantly been drawn, and I would draw the distinction particularly in the case of this corporation, because of the direct relationship between the House and the corporation, which does not exist with regard to another place. I should be content to rely upon that reason alone for having this distinction. Therefore, I suggest to hon. Members that it is a wise rule that Members of Parliament should not be members of the corporation, and I suggest that the same reasons do not apply to Members of another place.

7.38 p.m.

Mr. Poole

I hope the hon. Member for Stroud (Mr. Perkins) will press his Amendment to a Division, in which case I shall be happy to support him. I was interested to hear the Minister speak of the great political activity of Members of another place. On the few occasions on which I have visited another place, it has always seemed to me that it was a scene of great inactivity. Certainly, it was not surging with life—

The Deputy-Chairman

The hon. Member may not make reflections on another place.

Mr. Poole

I apologise both to you, Mr. Deputy-Chairman, and to another place. With regard to the Amendment of the hon. Member for East Aberdeen (Mr. Boothby), I think it is extremely undesirable that Members of the House should be members of the corporation. The hon. Member's example with regard to the last trouble with Imperial Airways was a very bad one. It is absurd to suggest that if Members of the House had been on the Board of Imperial Airways, that trouble would not have arisen. Hon. Members who have had experience of what has happened in the House during the past few days must know that if certain Members had been on the board of Imperial Airways, the position would have been a hundred times worse, because they would hardly have been the people most likely to look after the rights of the staff with regard to superannuation, pensions, and other benefits to which the staff felt they were entitled. I cannot conceive that certain Members of the House would have improved the relationship between Imperial Airways and its staff.

It is desirable that Members of the House should have no direct interest in a corporation of this character. We should be as detached as possible in order that, in considering the affairs of the corporation, we may be able to take a detached view. It would be undesirable that any Member of the House should be a member of the London Passenger Transport Board, and I do not think that if Members of the House were members of the board, it would help either the board or the House in deciding various points which might arise. The best method of ensuring that there shall be the most amicable. relations between the staff and the corporation is to give the staff the fullest rights of association in trade union organisations. Had those rights been accorded to the staff of Imperial Airways 18 months ago, we should not have had that trouble. Therefore, I oppose the Amendment of the hon. Member for East Aberdeen, but I should be pleased to support the Amendment in the name of the hon. Member for Stroud.

7.42 p.m.

Mr. Mander

Having listened to the arguments that have been made, I find myself in agreement with the Secretary of State. I should like to give an additional reason to those which the right hon. Gentleman gave. I think it would create a bad impression outside if we were continually creating new corporations and putting ourselves on the boards of them. For that reason, and for the reasons given by the right hon. Gentleman, I think it is desirable that we should remain in a detached position. With regard to the point that has been made about the difference in the treatment of Peers and Members of the House, I think the reasons for treating Members of another place differently are overwhelming. For centuries, by custom, and since the passage of the Parliament Act, 1911, by statute, the Peers have had nothing to do with the finances of the country, which are wholly in the control of the representatives of the people. For purposes of finance, the Peers might as well not exist. For those reasons, I think they are eligible to serve upon a board that deals with Government finance. We cannot have it both ways. I support the Secretary of State.

7.44 p.m.

Mr. MacLaren

The Secretary of State cited certain precedents where Members of Parliament have allowed members of another place to be members of boards of this sort. I am sure the Secretary of State will remember that on each occasion protests were made in the House on the same grounds as they are being made now. The right hon. Gentleman cited these precedents as though the House had assented to the same principle without discussion, whereas on most occasions there was opposition on the same grounds. I am surprised that so keen an observer as the hon. Member for East Wolverhampton (Mr. Mander) should have been so carried away as to think that, owing to the Parliament Act, the Lords have nothing to do with finance. May I remind the Secretary of State that he and his worthy Under-Secretary have for years carried on a strong agitation in favour of removing the disabilities under which the other House labours as a result of the Parliament Act? Suppose that the right hon. Gentleman's group is successful in that agitation. What will happen then? Will this Amendment of the hon. Member for Stroud (Mr. Perkins) be reconsidered in those circumstances? I wish the Secretary of State would give his reply openly and not sotto voce.

While it is true that a Member of the House of Lords would have no control over the financial provisions embodied in the Bill he could, none the less, use undue influence as a member of that House which is in close contiguity with this House. He has an entrance to this House which the ordinary member of the public has not. I see no difference in ability between Members of this House and members of another place which would mark out the latter as specially fitted for membership of boards of this type. In previous Debates on this subject, it has been argued that members of another place, being gentlemen of leisure, had more time to devote to these matters and that a great deal of ability was going to waste while their services were not utilised. It was suggested that they might as well use their time in this way as in any other way. I do not think that is an argument which carries any weight. If we are going to bar Members of the House of Commons, let us bar Members of both Houses. I do not know whether it is worth going into the Division Lobby on this question but if the Amendment of the hon. Member for Stroud is taken to a Division I shall certainly support it.

7.48 p.m.

Mr. Boothby

It is very easy to maintain a detached position in a matter of this kind if we are kept in complete ignorance of the facts of the situation. If it be the wish of the Committee to deprive Members of this House of all direct access to information about these companies, while at the same time plastering these boards with peers, then, for my part, they are welcome to do so. But I think that in doing so they will be making a profound mistake, and one which will be regretted later. This is a policy which will, in the long run, be reversed and in my view the sooner the better. Obviously, however, it is the wish of the Committee to see as many Noble Lords as possible on these boards, and no Members of the House of Commons. In those conditions, having made my protest, I beg to ask leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Mr. Perkins

I wish to withdraw my Amendment also.

Hon. Members

No!

The Deputy-Chairman

I did not call the hon. Member's Amendment. I said that the point which it raised could be discussed, if the Committee so desired, on the Amendment of the hon. Member for East Aberdeen (Mr. Boothby).

Mr. Lees-Smith

On a point of Order. Is it not intended to put the Question on the Amendment of the hon. Member for Stroud (Mr. Perkins)?

Sir A. Somerville

Is it not the case that that Amendment has not been moved by the hon. Member?

The Deputy-Chairman

That is so.

Question, "That this Schedule be the First Schedule to the Bill," put, and agreed to.

Mr. Poole

On a point of Order. May I ask you, Colonel Clifton Brown, how it was possible for us to discuss these two Amendments if the Second Amendment was not moved? It was your suggestion that we should discuss both.

The Deputy-Chairman

We have now passed away from the First Schedule.

Second Schedule agreed to.

Third Schedule.—(Provisional contracts for the acquisition by the corporation of the undertakings of Imperial Airways, Limited, and British Airways, Limited.)

Motion made, and Question proposed, "That this Schedule be the Third Schedule to the Bill."

7.51 p.m.

Mr. Mander

As you have not called the Amendment in my name, which proposes to insert in the Schedule: In the event of any such person being within a period of two years discharged from the corporation's employment for reasons other than disciplinary he shall be paid a sum in compensation of not less than three month's remuneration. perhaps, Colonel Clifton Brown, I may raise the point now. This is a matter on which the Secretary of State has found himself unable to meet the recommendations of the Select Committee, which expressed the opinion that the question of fair compensation for any employés who might be displaced on account of the amalgamation of the two concerns, should be considered with a view to the embodiment of more specific provisions in the Bill. I understand that all employés of both companies are to be taken on by the new corporation but there is nothing to prevent the new corporation immediately giving them a week's or a month's notice so that the security given by this undertaking is not as valuable as it appears to be. It may be said that the new corporation will be stronger and more powerful and that the position of the employés will be more secure. At the same time it is well known that in the case of all amalgamations, the employés who are in ignorance of what is going on, are always very much afraid of how their prospects will be affected. It is important in this case to give the employés all the assurance we can give. It may be that no one will be discharged but I would ask the right hon. Gentleman on behalf of the Government to make some statement with regard to the matter. In spite of the best intentions on the part of the corporation, it is possible that, within a year or two, a certain number of the staff would have to be discharged as a result of the amalgamation. I suggest that it would be in accordance with the best industrial and commercial practice to give, not the ordinary week's or a month's notice in such a case, but something of an ampler nature. I suggest three months, and I hope the Secretary of State will be able to indicate that the cases of any men who find themselves in the position I have indicated will be carefully considered. We do not know who the new directors will be. They may be drawn entirely from the Whips' Office. They may be members of the Government who will be put there in order to facilitate some reconstruction of the Government. We have had no information and it is impossible to expect the employés to feel that confidence which they have in the present directors whom they know. I hope that the right hon. Gentleman will be able to give to the employés of these companies, the assurance which, I think, should properly be given to them.

7.54 P.m.

Mr. Lathan

I wish to support the view indicated by the hon. Member for East Wolverhampton (Mr. Mander) in regard to the lack of provision for compensation for those who may be displaced as a result of this amalgamation. To say that there are insuperable difficulties in the way of such provision is to exaggerate. The right hon. Gentleman and his advisers must know that, over and over again, arrangements have been made in Acts of Parliament similar to those which the Select Committee have recommended in this case. Such arrangements are to be found in Acts dealing with railways, electricity undertakings and local government amalgamations. While the positions are not strictly comparable the principle is the same, that where, in the public interest, there is a merging of concerns injury must not follow to those employed in such concerns, and if they can show that their displacement is due to circum- stances associated with the amalgamation, they should be entitled to compensation.

7.56 p.m.

Sir K. Wood

Hon. Members will, I think, agree that I have endeavoured as far as possible to meet the views of the Select Committee and I would have been glad to have gone all the way in accepting their recommendations if it had been possible. But I do not think it is possible, or indeed reasonable to take the view which the hon. Members opposite have expressed in regard to employés in this case. I think a distinction must be drawn between private employés who have their own contract of service and the employés of utility companies, who are in a special category, with reasonable expectations of security of employment.

Mr. Lathan

What about the case of employés of electricity undertakings?

Sir K. Wood

In this case I would point out there are the most definite conditions. I refer hon. Members to this condition in the contract as set out in the Schedule: The corporation shall as regards all persons employed by the vendor company offer to take them into the corporation's employment as from the appointed day upon terms not less favourable than those upon which they were employed immediately before the appointed day. I suggest that that condition amply safeguards the employés and that from a practical point of view their position will be immeasurably improved.

Mr. Watkins

Suppose an employé is dismissed?

Sir K. Wood

I suppose that an individual employé would be in the same position as he is in now as regards notice. As regards the great majority of the employés, there is no doubt in my mind that their position will be immeasurably improved under the corporation with its greater prospects, and I suggest to hon. Members opposite that they need not be apprehensive. In view of the additional financial provision which this House is making, the operations of the company will be extended, and I suggest that the position of the employés is amply safeguarded.

Mr. Mander

It seems to me that the right hon. Gentleman's argument is unconvincing. It is no good saying that the corporation will be a wonderful new body and will be greatly strengthened and that all sorts of prospects will be offered to the employés. If employés are dismissed because of the amalgamation and for no other reason, the wonderful prospects of the new corporation will not be of any benefit or satisfaction to them. The right hon. Gentleman is not, I suggest, acting as the best employers in private industry would act. Where amalgamations take place in circumstances such as we are discussing, and men are discharged, it is usual to give those men more than the consideration to which they are legally entitled. Perhaps the right hon. Gentleman will consider the matter again before the Report stage, since, I am sure, he would like to act in this matter, on behalf of the Government, as a model employer.

Question, "That this Schedule be the Third Schedule to the Bill," put, and agreed to.

FOURTH SCHEDULE.—(Section 1 (1) of the Air Navigation Act, 1906, as amended by this Act.)

Captain Balfour

I beg to move, in page 41, line 28, to leave out from "the," to the end of line 30, and to insert "British Islands, exclusive of Eire."

This is a drafting Amendment to bring Section 1 (1) of the Air Navigation Act, 1936, as amended, into line with Clause 30.

Amendment agreed to.

Schedule, as amended, agreed to.

FIFTH SCHEDULE.—(Provisions as to wages, etc.)

Amendment made: In page 42, line 10, leave out "any."—[Captain Balfour.]

Motion made and Question proposed, "That this Schedule, as amended, be the Fifth Schedule to the Bill."

8 p.m.

Mr. Lathan

In the second paragraph of this Schedule reference is made to employer and trade societies. In the course of consideration of the Schedule by the Select Committee a question arose as to whether the term "trade societies" was intended to cover or include trade unions. I shall be glad if the Parliamentary Secretary can answer the question.

8.1 p.m.

Captain Balfour

The hon. Member has given me no particular notice of that ques- tion. I will undertake at a later stage to give him an answer.

Question put, and agreed to.

SIXTH SCHEDULE:—(Provisions as to pension and superannuation schemes of existing companies.)

Captain Balfour

I beg to move, in page 45, line 28, after "person," to insert: '"who is not immediately before the appointed day participating in the scheme. An employé, as defined by the regulations, is a person who has made application to join the scheme and whose application has been put forward to the assurance company by the board. It therefore includes actual participants in the scheme at the appointed day, but the specific mention of those persons is considered desirable, firstly because they represent the great majority of the persons with whom the paragraph deals, and, secondly, for the sake of uniformity with the corresponding paragraph 3 of Part 1 of the chedule.

Amendment agreed to.

Captain Balfour

I beg to move, in page 45, line 34, after "and," to insert: "(c) in either case."

The purpose of this Amendment is to make it clear that entry into British Airways superannuation scheme is conditional upon entry into the service of the corporation in the case of employés as defined. These are dealt with in sub-paragraph (a) of this paragraph, as well as in the case of persons who recently came into the service of the company, who are dealt with under paragraph (b).

Amendment agreed to.

Further Amendment made: In page 46, line 4, leave out "said."—[Captain Balfour.]

Captain Balfour

I beg to move, in page 46, line 30, to leave out from "is," to the first "the," in line 32, and to insert: "participating in the scheme and has entered."

This is a drafting Amendment designed to describe the person more accurately.

Amendment agreed to.

Bill reported, with Amendments; as. amended (in the Select Committee and on re-committal) to be considered Tomorrow, and to be printed. [Bill 210.]