HC Deb 19 June 1939 vol 348 cc1806-9
54. Mr. Montague

asked the Postmaster-General whether, in view of the fact that the group of manufacturers of telephone equipment which operate as a ring are engaged upon non-competitive agreements with his Department, he will assure the House that the public will be protected in regard to profits made by these firms in the same way as those engaged upon the production of armaments?

Major Tryon

The Bulk Equipment Agreement to which the hon. Member refers was made several years ago with a group of contractors in order to secure to the Post Office the benefits of standardisation of equipment, planned production and the pooling of patents. Prices have been revised from time to time as the agreement fell due for renewal. These conditions seem to me substantially different from those governing armament contracts but, as I indicated in my reply to the hon. Member for Birkenhead, East (Mr. White) on 12th June, certain additional facilities have been accorded by the contractors for checking the reasonableness of prices, and a detailed investigation is now proceeding as a preliminary to the arrangement of a new agreement.

55. Mr. Montague

asked the Postmaster-General whether he will supply a complete list of firms concerned in the supply of Post Office telephone equipment under non-competitive agreements with his department; and state their individual profits for each year since 1933, including the latest published figures?

Major Tryon

As the list for which the hon. Member asks contains the names of 23 firms, I will circulate it in the Official Report. I have no information as to the individual companies' profits, beyond that made available to the public by the Registrar of joint stock companies.

Following is the List:

Firms with which the Post Office has non-competitive agreements for the supply of telephone plant. —

56. Mr. Montague

asked the Postmaster-General whether he is aware that one firm, Messrs. Ericsson, engaged upon the supply of Post Office telephone equipment under non-competitive agreements has issued a balance sheet showing annual profits of 25 per cent., the same as the profit made the previous year; and whether he is satisfied with his Department's position with regard to this matter?

Major Tryon

I am aware of the facts referred to by the hon. Member, but I do not think it would be safe to draw any conclusion that the Department's interests—which represent only a part of the firm's business—are not reasonably safeguarded. The prices paid under the agreements with the equipment contractors are common to all the firms interested and are at present under detailed investigation.

Mr. Montague

Does that mean that the Government are not prepared to protect the public against the charges of these telephone companies?

Major Tryon

If the hon. Member reads my answer he will see that we are taking active steps to investigate this matter in order to secure fair prices for the public. He will realise that as a Department we are concerned to obtain proper prices for our contracts. We are not concerned with the profits of a firm over its whole business but to get proper prices for our own particular contracts.

Mr. Montague

Are the Post Office using the machinery for checking profits and costs?

Major Tryon

We are going into the question of checking, and if the hon. Member reads my answer of 12th June he will see what we are doing,