NEW CLAUSE.—(Amendment of ss. (2) of s. 1, 2, and 3, Geo. 6, c. 67.) (Hansard, 3 July 1940)

Vice-Admiral Taylor
I beg to move, "That the Clause be read a Second time."
Under the original Act the tenant is safeguarded from various proceedings if taken against him without the sanction of 956 the court. Public utility companies have special statutory powers. They come and cut off the gas, water, electricity and telephone if they do not receive payment. They are permitted by Statute to do so. The Attorney-General seemed rather to resent my use of the word "threat" during the Second Reading Debate on this Bill, in describing the way in which that power is used. If I cannot pay my water rate or my electricity charge, some official comes to me and says: "You have not paid your electricity charge. If you do not pay me in full, I will cut off the supply of electricity." I take that as a very substantial threat. As a matter of fact, that threat is put into practice. I have before me a letter which I received yesterday from a woman living in St. Annes-on-Sea. It has nothing to do with London. It is about water, and this is what it says: Dear Madam, Re Water Rate £2 0s. 6d. I find you have not kept your promise with regard to paying your water rate. Unless payment is made within the next 24 hours, the water supply to your premises will be cut off without any further warning. I imagine that is a threat.

§ Sir Francis Fremantle (St. Albans)
How many previous letters had she had asking for payment?

Vice-Admiral Taylor
I have also a letter here dated the next day, 25th June. The previous letter was dated 24th June. This letter says: Dear Madam, In reply to your communication of 25th instant as to your water rate, I will arrange for the time of payment thereof to be extended to 10th July, 1940. This is, however, subject to the express condition that the rate is paid in full by the date referred to, as no further extension will be allowed. The point is that there is a threat to cut off the supply of water.

§ Mr. R. C. Morrison (Tottenham, North)
Is that from the same company?

Vice-Admiral Taylor
Yes. The point is that the power places these authorities in the position of preferential creditors. People who have, over a long series of years, always met the demands for payment for gas, electricity, water and telephone, are now, as a direct result of the war—and I have particularly in mind the people about whom I have been so anxious, the keepers of apartment houses, 957 who have not been able to get custom—unable to meet those charges. Owing to the public utility companies having that power and using those threats, these people, who have never had to meet such a position before, become frightened. They believe that if they do not pay at once, their whole water supply will be cut off and, by hook or by crook, by borrowing or by overdraft, they do their best to pay and to meet those demands.
That is not fair, and it is all wrong. There is only one creditor, and it is not right that such power should be exercised. A landlord is not allowed to take possession of the furniture in an apartment unless he has permission of a court to do so, because it would be impossible for the house to be inhabited without the furniture. The court will not allow that to be done without an order having been made by the court. In the case of an apartment house, if the furniture were taken out, the livelihood of the tenant would go, and all the money sunk into the business would be lost. Furniture is only one of the articles necessary in order to run an apartment house. Gas, electricity and water are all necessary. Many of these places are heated by electricity; cooking is done by electricity and on gas cookers, and they also need water. How can they get on without water? All these things are just as necessary as furniture, but there is no protection whatever under the Courts (Emergency Powers) Act. At once, without any reference to the courts at all, the whole possibility of these people continuing their livelihood can be destroyed, and they can be put into the bankruptcy court. The principle is all wrong, and it is the principle upon which I am speaking.
I know that there is tremendous opposition in this matter, but, as a matter of fact, the gas companies have treated their consumers extremely well, According to my information, they have met them in every possible way. The electricity companies have not; they have done nothing at all, except to demand to be paid. Nothing is done as regards any new contract. Many of them have shut up a whole floor, every electricity point on that floor having been taken into account at the flat rate. I would like to see this matter altered in order that these utility companies shall not be in the position of preferential creditors. There 958 is no reason why they should be. Yet, as the Act stands now, they can continue in this manner. Supposing a water company was to cut off the water supply of any house during the period of this war, what would it mean? Suppose it was cut off now and in two hours' time incendiary bombs fell on that house. What would be the result? The house would inevitably be burnt, and not only that house, but it might start a conflagration over the whole town or city in which that house was situated. I would argue in all seriousness that to cut off the water supply from any house in time of war is a crime and should be prohibited. Some provision should be included in this Bill to prevent its being done, because it is a very serious matter. For the reasons which I have stated, I hope that the Clause standing in my name will be accepted and that something will be done to remove this privileged position in which these public utility companies are at the present time, and from which these people have no protection whatever.

§ Sir Annesley Somerville (Windsor)
On a point of Order. Is the Amendment to the new Clause to be discussed with the new Clause, or later?

§ The Chairman
The hon. Member's Amendment to the new Clause will be reached in due course. In the meantime, there is another new Clause on the Order Paper, in the name of the hon. Member for Westhoughton (Mr. Rhys Davies). It might perhaps be convenient to discuss that on this Clause if the hon. Member approves.

§ Mr. R. C. Morrison
I am sure that every Member would agree with the hon. and gallant Member for South Paddington (Vice-Admiral Taylor) if he had brought forward convincing evidence that the Clause was necessary; but I have listened carefully, and, apart from one case relating to a Lancashire water authority, he has brought no evidence in support of this Clause, which he is pressing so strongly.

Vice-Admiral Taylor
The hon. Member has entirely missed the point, that the threat to these people—which is the issue—forces them, by hook or by crook, to pay this liability in full. These undertakings are in a preferential position. It is because they have that power that that 959 is done. There are any amount of cases which could be brought up. There would be no difficulty about that.

§ Mr. Morrison
I do not want to fall out with the hon. and gallant Gentleman. I heard his talk about a threat; but if a man refused to pay his baker, his baker would not let him have any more bread.

Vice-Admiral Taylor
He could go somewhere else.

§ Mr. Morrison
I do not think the hon. and gallant Gentleman has made out his case. He made a speech on the Second Reading of this Bill, in which he said: I know from information which I have received that gas companies have met this difficult situation in a very satisfactory manner, and have been reasonable and generous in dealing with their customers."—[OFFICIAL REPORT, 26th June, 1940; col. 498, Vol. 362.] If that is so, why does he want to impose restrictions on the gas companies by this Clause? He says that, because they have been reasonable, generous and very satisfactory to all their customers, we are to put restrictions on them. He then refers to the action of the Post Office in cutting off people's telephones, but he does not propose to do anything about that. The hon. and gallant Gentleman says that the gas companies have been reasonable, generous and very satisfactory in all their dealings with their customers, but not so the Metropolitan Water Board.
I suggest that the hon. and gallant Gentleman has not taken the trouble to find out the facts, or he would have found that the Metropolitan Water Board is reasonable and generous and deals very satisfactorily with all its customers. I am going to prove that, if not to the satisfaction of the hon. and gallant Gentleman, to the satisfaction, at any rate, of every other hon. Member. In order that he should prove his case, he should have shown that, as a result of the war, there were more people having their water cut off than before the war. I am going to prove, by the figures, that the number is something like a third of what it was before the war, so he cannot argue that this is a wartime problem which has suddenly developed. Everybody who knows anything about London's water supply knows that, out of 1,500,000 water consumers in London, there are roughly 2,000 who have conscientious objections 960 to paying for the water. For some reason, they think that, while all other goods should be paid for, water should be given away free. The Metropolitan Water Board, which is a public body—Labour-controlled, by the way—and which is responsible for this, although it does not make any profit, cannot afford to give water for nothing; but 2,000 consumers, before the war even, have made as much difficulty as possible about paying for water, because they do not like paying for it.
Here are the conditions that the Metropolitan Water Board lay down before they take any proceedings against any one or make, as the hon. and gallant Gentleman says, any threats. The standing instructions laid down by the Metropolitan Water Board are that the water supply is not to be disconnected in the following six separate classes of case: (1), where there is extreme poverty, (2), where there is distress through unemployment, (3), where there is illness on the premises, (4), where it has not been possible to meet the consumer or a member of his household for service of the Board's letter, (5), where severance of the connecting pipe was necessary and the cost would be disproportionate to the amount of the rate, and (6),"— and this one has been issued since the commencement of the war— where instructions have been given that the supply must not be disconnected where the responsible ratepayer is serving with His Majesty's Forces. I think all these cases are very reasonable, but, in addition, the Metropolitan Water Board have given instructions to their officials that water is not to be disconnected from any premises without the finance committee of the Board considering the whole of the circumstances of the case. Inquiries have to be made, and the finance committee personally has to deal with the case before the supply is cut off. The Metropolitan Water Board afford a supply to 1,500,000 premises within their area, and there are approximately 1,000,000 premises where the Board have power to cut off supply in the event of the rate being unpaid.

Vice-Admiral Taylor
I apologise for interrupting again, but in all these cases that the Metropolitan Water Board are considering there is nothing done about cases of apartment-house people where they lose their means of paying and meeting these payments straight away in full. 961 As a direct result of the war, they are unable to pay up.

§ Mr. Morrison
I think that that comes under the heading of "extreme poverty."

Vice-Admiral Taylor
Oh, no.

§ Mr. Morrison
If they are not suffering from extreme poverty they are able to pay the water rate. It was necessary for the hon. and gallant Gentleman to give some figures in order to prove harshness. For the year ending 31st March, 1938, supplies were cut off in 683 cases out of 1,500,000; for the year ending 31st March, 1939, the supplies were cut off on 1,083 premises; for the year ending 31st March, 1940, which includes six months of the war, the number comes down from 1,083 to 272; and for the last three months ending on 30th June the number of cases is 42. Therefore, I do not think that anyone can say that any harsh action is being taken by the Board as a result of anything that may have happened during the war. As regards complaints, the Ministry of Health has received one complaint since the outbreak of war. In that complaint the rate was due before the war and ought to have been paid, and the complainant, who stated to the Ministry of Health in his complaint that he was out of work, was in fact the owner of several properties with the aggregate rateable value of £264. The only other case of a complaint sent to a Government Department, to the best of our knowledge—I am speaking now on behalf of the Metropolitan Water Board, of which I am a member—is one which was brought to the attention of the Ministry of Labour. In that case it was found that the company had been in arrears of rates in previous half-years, and since the complaint the debenture holders had gone into liquidation, and the company was being ordered to be wound up. There was one further case that was brought to my notice, and there hardship was proved and arrangements were made for the rates to be paid by instalments.
It seems to me that in the case of a responsible authority like this it is somewhat unfair, without any real evidence being brought forward, that an attempt should be made to put into emergency legislation something for which no demand has been proved. It may be said 962 that I have confined my remarks to the Metropolitan Water Board, but I have done so because the hon. and gallant Gentleman, on the Second Reading of the Bill, went out of his way to specify the board and the hardship of their methods. It may be said that other water undertakings may not be so generous, but, apart from the one which the hon. and gallant Gentleman has mentioned, there has been no such evidence before the Committee, and I am sure the Committee does not want to justify the passing of legislation like this without an attempt being made to prove a case. Had there been any evidence at all that public undertakings were, as a consequence of the war, using their powers harshly in any way, I, as a member of a local authority, would be one of the very first to say that such a thing should stop. The effect of this Amendment, if passed, would be that many thousands of people occupying premises and using water in London, realising that it would be necessary for the Metropolitan Water Board to go to court to get an order, would stop paying their rates. Of the 42 cases I mentioned as having been reported to the board, there is not the slightest doubt that if it had been necessary to go to court, there would have been no difficulty in getting orders. The hon. and gallant Member should remember, before he takes up a case of this kind, that in a large number of these cases water is cut off because a house is left empty, the tenant cannot be found, and it is necessary during cold weather for somebody to get into the premises quickly to cut off the water supply.

§ Mr. Rhys Davies
I rise to say a word in favour of the new Clause standing in my name—"Restriction on withholding of supplies." If what the hon. Member for North Tottenham (Mr. R. C. Morrison), has said in favour of the Metropolitan Water Board is correct and true, he should have no objection to compelling every other water undertaking in the country to do likewise. I feel sure that not every public utility company is as generous as the Metropolitan Water Board, which is, I understand, largely made up of local authorities. There are some gas companies which are privately owned and which, quite frankly, I do not trust. In saying that, I am glancing at the 963 other side of the Committee. Let me, however, support the hon. and gallant Gentleman the Member for South Paddington (Vice-Admiral Taylor) on one point. It is true that water, gas and electricity fall into an entirely different category from furniture and food. If you are not pleased with one shopkeeper, you can go to another, but there is in London, I understand, only one supply of water, and that is through the Metropolitan Water Board. You cannot go to the Manchester Corporation for water if you are displeased with the Metropolitan Water Board. I am sure the Committee knows that water, gas and electricity fall into a separate category when we discuss this subject. My new Clause is a compromise between two extremes. I never like to ruffle anybody's feelings, whether he be on the Left or on the Right. I will try to explain what my new Clause means. Whatever the hon. and gallant Gentleman's new Clause may do, my Clause would at any rate prevent the cutting off of any of these services except by the permission of the court.

Vice-Admiral Taylor
That is what my new Clause would do.

§ Mr. Davies
The hon. and gallant Gentleman was not quite clear that it meant that. My new Clause is a compromise in so far as it states: Any default in the payment of a debt arising by virtue of a contract made since the passing of the principal Act. I hope the Committee does not wish to support those people who have a conscientious objection to paying for anything. There are such people. I know of a case where a man has been in debt, not only for his gas, electricity and water, but to everybody, and he could afford to pay if he wanted. I can tell the Committee that he is not a member of the Labour party; he is a member of the other party. Therefore, I think that my new Clause may appeal to hon. Members on all sides of the Committee, and having explained what it means as effectively as I could, I hope I have now convinced hon. Members that I have made out a case for it.

§ Sir Francis Fremantle (St. Albans)
The hon. Member for North Tottenham (Mr. R. C. Morrison) has spoken against the new Clause from the point of view of the 964 Metropolitan Water Board. I want to put the argument from the point of view of the water undertakings of the whole country, on behalf of the British Waterworks Association, which includes both Statutory and municipal undertakings. The question is one of hardship. I regret that the hon. Member for Westhoughton (Mr. Rhys Davies) suggested by implication that the provincial water undertakings are not generous. As a matter of fact, I have taken the precaution to find out what was the actual number of cases that had to be cut off by different water undertakings. In the case of Liverpool, a big undertaking supplying more than 1,000,000 people, no consumer had his water supply cut off. That hardly bears out the implication in the hon. Member's speech against their generosity.

§ Mr. Rhys Davies
I did not make an attack on any undertaking controlled by local authorities. My attack, if attack it was, was on private companies.

§ Sir F. Fremantle
I do not know quite what the hon. Member means by private companies. These are not private companies in the ordinary sense, but public utility undertakings, and I hope the Committee recognises that public utility undertakings cannot make money. The amount of dividend they pay is limited absolutely by the Statute allowing them to raise money. Consequently, if a public utility undertaking loses in any way, the loss has to be made up out of the water rates, and if some people do not pay their water rates, those who do pay have to make good the default of those who do not. I will give instances from my own constituency, where a small undertaking supplies 250,000 people. The actual number who did not pay last year was one in a thousand. They had to have the penalty imposed upon them of their water supply being cut off.

Vice-Admiral Taylor
May I ask the hon. Gentleman whether the people in his district have been directly hit by the war in the same way as the apartment house keepers of whom I am speaking? It makes a considerable difference.

§ Sir F. Fremantle
I do not know what the hon. and gallant Admiral means by "hit by the war." If he means poverty, I am sure his district is not so poor as that of Liverpool, where there was not a 965 single case of water being cut off, or Manchester, where the number was only 12, or Bradford and Leeds, where the number was only three. It is absurd to suggest that poor people in these other areas are badly treated by this provision.

Vice-Admiral Taylor
rose—

§ Sir F. Fremantle
I think we have the argument perfectly clear. There must be some definite provision to deal with people who do not intend to pay unless they are made to do so. It is exactly the same in the case of Income Tax. Perhaps the hon. and gallant Admiral does not pay his Income Tax until he receives his second notice, or perhaps it is after the third notice. It must be the same in the case of water and electricity undertakings. We find that something like 90 per cent. of the consumers do not pay until after the second or the third notice, after which the water is cut off if the amount is unpaid within seven days. There is no hardship about the provision. The only alternative suggestion to this method has been put forward by the hon. Member for Westhoughton. He suggests that these cases should be taken to the courts. But imagine any water undertaking having to take to court every person who does not pay. With 90 per cent. not paying up to time, the courts would be crowded with cases. It would be pouring money into the pockets of the legal profession.
The argument is so clear that I need take it no further. I will, however, give to the Committee, as an example, a case of a man living at Southend who refuses every year to pay his water rate until his supply has been cut off. He is in affluent circumstances, and always pays, the day after his water has been cut off, the £12 owing, plus 25s. to reconnect the supply to his house. Why he does it, heaven only knows; but it is only the threat of cutting the water off which is the moving force, and it will be so in all these cases. Where there is hardship the undertakings always treat cases most kindly, especially in the case of serving men. On behalf of all these utility undertakings, I hope the Clause will be resisted.

§ Mr. Glenvil Hall (Colne Valley)
I think that the arguments so far adduced, although extremely interesting as showing how water boards under labour control 966 operate, do not really help us very much in considering the actual matters before us. It is perfectly true, as the hon. Member for St. Albans (Sir F. Fremantle) and the hon. Member for North Tottenham (Mr. R. C. Morrison) have said, that poor people are extremely good payers when it comes to meeting their water rate.
The short answer to that is that if people pay so well, why should the two hon. Gentlemen be so fearful that, if we had this protection for the serving men and other people hit by the war, everybody else would refuse to pay until an application was made to the court to cut their water off? The hon. Member for St. Albans said it would be a pity if we passed this legislation because many people paid only on threat of having their water cut off. There is a provision on the Statute Book to prevent the hon. Member having his throat cut, and although it has not happened yet, that is no reason why that provision should be repealed, leaving him to whatever chance might befall. It has to be remembered that this Bill will operate only in cases of people who have been badly hit by the war. Other people will meet their water, gas and electricity bills as they have done in the past. It is curious that the hon. Member for North Tottenham should speak as forcibly as he did. I know he spoke of what he knows to be true, but only to-day I heard of a case in Wimbledon where a woman, who has been an excellent payer through a fairly long life, and owed only a few shillings, had her house entered during her absence and the water cut off. That kind of instance occurs up and down the country and we ought to protect the people who suffer under it.

§ Mr. R. C. Morrison
My hon. Friend is not referring to a case within the purview of the Metropolitan Water Board?

§ Mr. Hall
I take it not from what my hon. Friend said, but I was assured that it was true. Gas and electricity undertakings, and in some places water undertakings, are in a different category from other concerns. They have a monopoly in their areas and in some cases they use their powers to the full. Some of us remember what happened in this area, where the electric light company has seen fit to put up its charges. Although there was a good deal of outcry about it, it died down because everybody realised that 967 they were in the hands of the undertaking. It has done what it likes with those of us who live in the area. Members of Parliament may be able to stand it, but I am thinking of the soldier's wife who finds herself unable to meet her gas and electricity bills. Unless we give her protection in this Measure, it will be possible for the officials of the undertakings to cut off her supplies. That is not right. We ought to protect these people if we can. We can protect them by the provisions in this Measure. It will not do undertakers who are reasonable with their consumers any harm whatever. Everyone knows that there are undertakings which are unreasonable and we ought to protect people against them.

§ Sir Stanley Reed (Aylesbury)
The hon. Member has repeated a fundamental fallacy enunciated by the hon. and gallant Gentleman the Member for Paddington (Vice-Admiral Taylor) and the hon. Member for Westhoughton (Mr. Rhys Davies). They labour under the delusion that gas and electricity supply companies have a monopoly. They have no monopoly whatever. There are alternative methods of lighting, heating, and cooking. I should be prepared to demonstrate that by far the cheapest method of cooking is neither gas nor electricity. Those undertakings labour under very severe competition. There are alternative methods of supply. No one who has spoken has pointed out that they are under statutory obligation to supply, and they are given special means of recovering their charges. If my butcher does not like the look of my face or finds my credit is bad, he refuses to supply me. It is all very well to say I can go from butcher A to butcher B, but if butcher B inquires into my credit, he may refuse to supply me. An undertaker cannot refuse, and, because he must supply, even though he has every reason to believe the applicant's credit is not good, he has this special power under the Act of cutting off supplies. There has been a convincing reply on behalf of water companies. The hon. and gallant Gentleman himself said there was no grievance against gas undertakings. An electricity supply company in these competitive days will not cut off a consumer except for paramount reasons. It is impossible to maintain a statutory 968 obligation to supply without giving them the protection the Act gives them.

§ Sir Reginald Clarry (Newport)
I hope the Attorney-General will resist the Clause. I am surprised at my hon. and gallant Friend giving himself all this trouble without the slightest evidence to justify him. On the contrary, in reference to gas undertakings, he has gone to the other extreme, and he says how satisfactorily they have done, and by way of reward he wishes to penalise them by taking away statutory powers which they have acquired by Act of Parliament for many years. I do not think he attempted to justify that at all.

Vice-Admiral Taylor
My point is the threat that is used. It is on account of the threat that people by hook or by crook pay these accounts.

§ Sir R. Clarry
The hon. and gallant Gentleman has had a very good innings. He has been on his feet 10 times in the last few hours. If you are dealing with a butcher or a baker, it is not a question of a threat. They simply do not deliver at all. As the hon. Member for Aylesbury (Sir S. Reed) has said, the public utility undertakers have an obligation as well as what may be apparently a monopoly. What has happened during the war, in the last nine months? There have been fewer cuttings-off than in any comparable period, but in consequence, I presume, of the harder times, the number of bad debts has gone up. I have been making inquiries from one of the largest gas undertakings in the country. Fortunately the bad debts have not been serious, but they would become serious if an Act of Parliament were passed depriving them of the opportunity of recovering and making it impossible for them to deal with their customers in the generous way to which hon. Members have paid tribute.

§ The Attorney-General
We have had a well-balanced discussion and I shall advise the Committee not to accept this new Clause. Everybody has said that gas, water and electricity fall into a special compartment, and I agree, but there are one or two things which it is relevant to remember. First, the vast bulk, if not all, of these public utility statutory bodies are under the general supervision of Departments of the Crown, and there are Ministers who are responsible to this House for 969 them and who, if Questions are put, are prepared to look into any cases submitted. In that way the action of these public utility concerns can be raised in this House. The next important point is that these bodies are under a statutory duty to supply. If his butcher refuses to supply my hon. and gallant Friend the Member for South Paddington (Vice-Admiral Taylor) because he has not paid his bills he goes to another butcher; but in time, of course, he would exhaust the butchers in his locality and then he would find the supply of meat dried up.

Vice-Admiral Taylor
I did not use that argument in relation to gas and water.

§ The Attorney-General
Yes, but I am taking the two arguments together. A statutory utility undertaking is compelled to continue supplies. I think the two facts—that individual cases can be brought to the attention of this House, and that there is a statutory duty to supply, are very important in the consideration of this new Clause. The position as to gas is not under criticism. The hon. and gallant Gentleman gave the gas undertakings a good character from the outset. The position of water undertakings has been extremely well defended by the hon. Member for North Tottenham (Mr. R. C. Morrison) who gave what I thought were very striking figures of the way in which the Metropolitan Water Board, which has been singled out for attack, had been dealing with matters since the war broke out.
As far as electricity is concerned, last autumn the London Apartment Keepers Emergency Association were asked to produce cases of what they regarded as unreasonable action by electricity undertakings. They produced two, which were investigated by the Electricity Commissioners. Since then the Ministry of Transport have had no case, and the Electricity Commissioners only one. The hon. and gallant Member talks about threats. I have no doubt that if the London Apartment Keepers Emergency Association took the view that a threat was unreasonable, they would take action. They would have drawn the attention of the Ministry of Transport or the Electricity Commissioners to the matter if they had felt that unreasonable use was being made of this power. As far as electricity undertakings are concerned, 970 only one or two specific cases were produced last autumn when the London Emergency Apartment Keepers Association were invited to do so. I feel that there is great force in what the hon. Member for North Tottenham said, that the Committee had been asked to accept this new Clause without any real evidence in support of it.
Nobody wants oppressive use to be made of this power. All my right hon. Friends who preside over various Departments have said they were willing to consider any case in which it was thought there had been unreasonable conduct. Therefore, we cannot accept this Clause tonight; but, if evidence is brought forward, it will be looked into. If they can be dealt with administratively and so save a good many unnecessary applications to the court, so much the better. If not, the House is always free to consider the matter at a later date.
Question, "That the Clause be read a Second time," put, and negatived.
Bill reported, with Amendments; as amended, considered; read the Third time, and passed, with Amendments.