HC Deb 13 March 1940 vol 358 cc1172-3
20. Sir R. Acland

asked the Secretary of State for Air whether he has approved the practice of Western Engineering, Limited, now working on contracts for the Air Ministry, of asking sub-contractors to make price contracts for deliveries over considerable periods, while retaining the right themselves to terminate the contract at any moment; and whether he can give an assurance that this practice will not prevent supplies coming forward at lowest prices?

Sir K. Wood

This firm has no direct contracts from the Air Ministry, but it is acting as a sub-contractor to one of our contractors under a fixed price contract. The arrangement which the firm has made with its suppliers is, I understand, common in the building industry, and the amount ultimately payable by my Department under the contract is not affected by it.

Sir R. Acland

Is the Minister aware that this matter has amazed all the local builders in the area and that supplies which might be available for construction are held up because of this practice, while the workmen stand there with nothing to do?

Sir K. Wood

I am told that this is quite a usual arrangement.

Mr. Robert Gibson

Are we to gather from that answer that contractors may be taking into their accounts very large figures for sub-contracts without the right hon. Gentleman's accountants being able to scrutinise these figures?

Sir K. Wood

Oh, no, Sir. That is not so.

Sir A. Sinclair

When the Minister says this firm is a sub-contracting firm, is it in fact a subsidiary of the firm from which it received the contract?

Sir K. Wood

I am not aware of that. If the right hon. Gentleman has any information which he thinks has a bearing on this matter, I shall be glad to have it.

Sir R. Acland

Perhaps the Minister would give me the name of the head contracting firm?

Sir K. Wood

I will inform the hon. Member.