§ Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Boulton.]
§ Wing-Commander James (Wellingborough)
The point I wish to raise is a narrow one and concerns the employment on big contracts, on sites under the aegis of the Ministry of Works, of trade union officials who are being paid not by union funds but indirectly by the Government. I want to make it perfectly clear that there is in my remarks no implied criticism whatever of trade union practice. We, on this side of the House, regard ourselves as being the true protectors of the interests and liberty of trade unions. Nor am I questioning the result that has ensued from this practice and I may say that the only personal friend I have who is in this business—a director of a big firm of contractors—took the trouble to tell me that in his experience the results of this practice on production have been most satisfactory. I am concerned only with the principle involved in the payment.
820 In order that there might be no misunderstanding I have given my hon. Friend the Parliamentary Secretary, who is to reply, a full intimation of all I wish to seek from him. I will tabulate the questions briefly but before I do so, and to make the position clear to the House, I must quote the basis of my complaint. I wish to quote Supplementary Condition No. 1, which is an addendum to a contract form which a contractor has to sign undertaking this obligation. It is called "Trade Union Representatives on Building Sites Levy on Government Contracts." Paragraph 1 reads as follows:For the purpose of maintaining trade union representatives on large Government building site the contractor shall, on demand, within a calendar month of the day of acceptance of his tender, pay, as a levy into a trust fund (the treasurer of which is an officer of the Ministry of Works), established for the purpose, a sum equal to 0.1 per cent. of the estimated value of the work which is in this case. …Then follows the amount of the contract. Paragraph 2 says:The contractor shall not be released from his obligation to pay the amount of levy demanded if a trade union representative is not allocated to the site.Paragraph 3 says:If a representative is allocated to the site he shall be allowed full access to any part thereof to inspect work in progress and the contractor shall be required to provide for the representative suitable office accommodation with telephone and transport if warranted by the circumstances of location. Payment of the reasonable cost of the facilities defined is to be admitted as an extra to the contract price.I, therefore, want to ask these questions, because so far as I know this is an entirely new practice and there is no precedent for a Government Department paying trade union officials direct. I want to ask: who initiated this practice? Am I right in saying that there is no precedent for it? When was it started? Did the contractors ask for it or object to it? How many trade union officials have been, and are being, so employed?
Are they all from one union? How are they selected, and what is the total sum that has so far been collected and what is the total that has been paid out? Next, to whom is this money actually paid? Are these men trades union representatives or Government officials? They must be one or the other. The "Daily Herald" on 7th December last, in a paragraph on this question, wrote as follows: 821These officials are independent and responsible only to the Federation.That would be a very surprising statement if true, because they are paid by the Government. If they are trades union officials in the ordinary sense of the word, then why should the taxpayer pay their salaries and not their union in the ordinary way? The Committee on Public Accounts which published its Report considerably after I first gave notice of raising this question, made some severe observations on these points. I quote from the Report of the Committee on Public Accounts dated 13th October last. On page 4 comes the Class 7, Vote 6, Ministry of Works and Buildings. At the top of page 5 they say:The so-called levy is payable by contractors but is recoverable by them from Departments as an expense under their contracts.They give some figures in the next paragraph and then they say—this disturbs me most of all—… payments into the trust fund will in effect be made out of voted moneys but will not be regulated by, or accounted for, to Parliament …At the bottom of the page, in the last paragraph, they say:It is admitted, however, that the indirect form of the trust scheme was adopted in the hope that it might by a simple process be carried on into the post-war world, and it is clear that sums of public money have been set aside which are much in excess of the current requirements of the scheme.Those of us who hope that building after the war is going to be an economic proposition at a reasonable price feel that to be saddled with the present figures of cost would be impossible, and the idea of building up under war conditions funds to perpetuate the Ministry's existence in peacetime is very disturbing indeed. I think it will hardly be denied that the point I have raised is a constitutional and material point. I am giving the Minister plenty of time to give the very full explanation it demands, and I would point out to those hon. Members opposite who are still here that if such a practice as this became general, the freedom and independence of trade unionism would be gone. If trades union officials are to be paid by the taxpayer, then goodbye to independent trade unions, and we shall be half way to the totalitarian State. I hope I have not spoken too fast for the Minister to put down the rather numerous points I have raised but, as I said at the 822 beginning, I did give him full warning of what I was going to ask for, and I hope he will give me as full an explanation as the case warrants.
§ Mr. Bossom (Maidstone)
On one of the other Committees in the House I have had the opportunity of seeing how this system works, and I would like to say that it is a very practical proposition. The background of this will make others realise that there was a lot of justice in what was done. We had just had a lot of trouble, we had a great mixture of men working, the situation was getting very serious and in the middle of 1941 production went down badly. We all knew that we could not afford waste of time in the production of our buildings. I have been round all the munition camps and I have seen much other building for the Air Ministry and I saw the situation. The Minister of Labour asked various associations of employers and operatives whether they could make any suggestions as to how the matter could be straightened out. They made a number of recommendations and one was that the best way was to put some one on the sites who could talk to the men individually and take the problems quietly to the employers without making a lot of disturbance and straighten out the troubles before they got worse.
§ Sir Patrick Hannon (Birmingham, Moseley)
Do I understand that this was agreed between the Federation of Employers and the operatives' organisation?
§ Mr. Bossom
I think it was an invitation from the Minister of Labour to the employers and operatives together and they made these suggestions to the Minister, who approved this particular one that they should have a representative of the trade union, who was used to handling men, on the job. They were to have no trade union relations with the man as such but were to be intermediaries with the employers in any difficulties that arose. Having seen these men on various operations in the country I can say without any doubt at all that the situation improved very materially. I think only the war would allow these extreme conditions to apply. The men who went there, I believe 60 originally, are now reduced to half that number. They are being reduced as the programme gets lessened. It was a perfectly practical proposition. It was 823 a war measure, which was applied very successfully, and I think it helped our production when it was vitally necessary and we could not afford to have any more stoppages or to waste any more money. [Interruption.] I believe on contracts over £100,000 where there were more than a certain number of men. I believe the money was collected from the contractors on a certain very small percentage of the contract price. Had it been known that the contractors were going to have to pay this, they would have put it on the contract price, so the public would have had to pay it anyhow. If this term had been in the contract that this money had to be paid, obviously they would have called on the Government to pay the additional amount. I have watched it since 1941, when it was introduced. It improved the work on the sites and it seems a very valuable provision.
§ Wing Commander James
What my hon. Friend has said is entirely apart from my point. I was concerned only with the principle of their payment and not with the work that they did.
§ Mr. Bossom
I do not want to attempt to give the answer that the Minister obviously will give but this was to my mind an essential means of getting over the difficulty.
§ The Parliamentary Secretary to the Ministry of Works (Mr. Hicks)
I regret that circumstances have prevented my hon. and gallant Friend from raising this matter earlier. He has been very patient in Adjournment after Adjournment for many months, and he has not been able to bring it up earlier. I am grateful to him for bringing the matter forward now and for giving me the main points he was desirous of raising. I hope the House will forgive me if I stick closely to notes, but I must do so because time is short. I hope, however, to be able to deal adequately with all the points that have been raised. May I thank the hon. Member for Maidstone (Mr. Bossom) for his contribution to the Debate? I accept the view that the scheme has novel features. It was introduced on Government contracts during the war and, so far as I know, has never been previously introduced. Indeed, the scheme has its origin in wartime conditions under which large numbers of men, many of them directed away from their homes, were being employed 824 on numbers of large jobs, the majority of them being in isolated parts of the country. Nearly all our building work has to be taken out to the most remote parts. In these circumstances the difficulties of transport, billeting, canteens, protective clothing, rubber boots and other matters assumed a new importance in the building industry. The conditions were such that relatively small grievances could easily become magnified into matters of major controversy. We have seen that during the last week or two when there has been no one on the spot to handle difficulties as they arise and what appear to be very small grievances develop into major difficulties and disputes taking place before they could be overhauled.
The second point I wish to make is that the scheme was introduced with the full approval of both sides of the industry. Both employers and operatives in the building and the civil engineering industries were invited to a conference by the Minister of Labour and the late Minister of Works and Buildings, Lord Reith, to discuss how we were to get back to the production that had previously existed in the industry, which had depreciated rather badly. We were in an extremely critical period in March, 1941, when it was essential that every possible measure contributing to our war effort should be taken. The Minister of Labour and Lord Reith met representatives of the principal federations of employers and operatives in the industries and invited their co-operation in suggesting means for increasing production. The four federations submitted to the Government a memorandum of methods for securing greater efficiency and improved output on essential Government building and civil engineering works. It included in particular a recommendation that on any site on which there were more than 2,000 men employed, a full-time trade union official should be installed for the purposes of consulting with the management on labour questions. After full consideration the proposal was accepted by the Ministers concerned as a special measure for meeting war-time difficulties only. As such, the scheme has worked remarkably well. There has been no major dispute or stoppage of work on any of the sites on which site officers were employed. They were able to deal with grievances at their commencement, discuss them with the management, and get any required adjustments made.
825 Careful consideration was given as to where the cost of the scheme should lie—a legitimate point. The trade unions concerned were both unwilling and unable to bear the cost. In these circumstances, as the appointments were regarded as essential by both sides of the industries for assisting in increased production on the Government building programme, the then Minister of Works and Buildings decided that the cost should be borne by the Government.
I can assure my hon. and gallant Friend that unless both the employers and operatives had both agreed that it was necessary to make use of these site officers my Ministry would not have suggested asking the Treasury to bear the cost. The necessary funds were originally obtained by a levy on all Government building contracts of £100,000 and over, let on and after 1st October, 1941. The amount levied was charged to the contract, and allowed to the contractor by the Contracting Department. The Government have, therefore, borne the cost from the outset. It is estimated that the cost of the construction works on which site officers have been employed amounts in total to over £200,000,000, and, on this basis, the cost of the scheme works out at about 4d. in every £100 worth of such work.
Freedom from friction on the sites and the increased production which accompanied it have, therefore, been obtained at remarkably small cost. That it has been possible to carry out a programme of this magnitude without a stoppage and at such small cost is a testimony to the wisdom of those who initiated it. As I have stated, the scheme was a war-time measure. The question of continuing it in some form or other after the war was always recognised to be a matter for the industry. The two main employers' organisations have recently indicated that they are unwilling to commit themselves to the continuance of such a scheme in the post-war period, and, in these circumstances, my Noble Friend, Lord Portal, decided to abandon the levy procedure and to finance the scheme direct from the Ministry of Works Vote. As from 1st October, 1943, the levy clause has been omitted from the contracts of all Departments. The expenditure from the inception of the scheme has been taken on the Ministry's Vote, and the proceeds of the levy up to 1st October, 1943, have been 826 transferred to Appropriations-in-Aid of the Ministry's Vote.
The hon. and gallant Member asked for the withdrawal of supplementary condition No. 1 from the Paper entitled "Trade Union Representation on Sites: Levy on Contracts." This relates to the collection of the levy, and, under the action initiated by my Noble Friend last September, the Paper in question is no longer sent to contractors.
Treasury sanction was obtained for the appointment of 60 site officers and, with the approval of the contracting departments concerned, the first 14 site officers were appointed to their appropriate sites, or groups of sites, in February, 1942. The number of site officers employed rose to 34 in August, 1942, and to 54 in January, 1943. This was the largest number of site officers employed. After that date, the reduction in the building programme made it possible to dispense with the services of some of the site officers. At June, 1943, the number employed was 51. Today, it is 33, covering 221 sites, and two more are being given notice, so that, by the end of January, the numbers will have fallen by 20, or nearly 40 per cent., of the June total.
§ Mr. Hicks
Yes, Sir. The number employed thereafter will decline with the Government building programme, and it is expected that a further five may be released in February.
As to appointment of site officers, the individual site officers are nominated by the National Federation of Building Trades Operatives, but each appointment is subject to the approval of the Ministry of Works, which has also the right to require his transfer to another approved site and to withdraw its approval of any site officer. The Federations of Employers are kept informed of all appointments, and contracting Departments are notified of appointments affecting their contracts.
Regarding the functions and status of these men, the functions, status and duties of site officers were agreed between the representatives of employers and operatives and my Department. They areto facilitate the removal of possible causes of labour difficulties and complaints by ascertaining them at an early stage and by reporting to and 827 consulting with the management thereon to the end that they may receive timely attention or if not found capable of resolution by such means may be the subject of references to the appropriate joint industrial machinery.I think that the whole position has been misunderstood. The site officer is debarred by the terms of his appointment (which is subject to the approval of the Minister) from all those trades union activities connected with the organisation of labour as such. He is not allowed, for example, to collect subscriptions, nor does he represent the workers on the site. The latter have their own local trades union organisation, whereas the site officer reports site difficulties, if necessary to the headquarters of the Federation only. He is concerned particularly with matters of welfare and other matters affecting the well-being of the workman, and his efficiency. He is the channel of communication between employers and operatives which has proved of the greatest use in the special conditions of the Government wartime building programme.
These are the facts relating to the scheme. As to its operation, I have heard nothing from any employer but good accounts of it; certainly no complaints in regard to the way in which the site officers have discharged their duties have been made to my Department by individual contractors, and it is the unanimous view of employers' organisations and of the contracting Departments that they have contributed greatly to the efficient and speedy carrying out of the Government building programme. In my opinion, the site officers have proved to be most successful in effecting the purposes for 828 which they were appointed, and I suggest to the House that the adoption by the Government as a war-time measure of the scheme recommended to it by both sides of the industry has been fully justified by the results achieved.
The levy up to 1st January, 1943, was at the rate of 2s. per £100 of the contract price. After 1st January, 1943, this was reduced to 6d. per £100. The nett receipts from the levy for the period up to 30th September, 1943, when it was discontinued, were £91,644 and the total expenditure of the scheme up to 31st December, 1943, is £41,524. The National Federation of Building Trades Operatives has been used as the medium for carrying out the arrangements.
I hope that I have given the basis for the initiation of this scheme, how it was initiated, and for what purpose, and how it has worked. Although we have used the National Federation of Building Trades Operatives to nominate personnel to act as site officers my Ministry has on every occasion had the right to agree to the appointment, to agree to cancel the appointment, to reduce it at any time it was necessary to do so, and in every instance the site officer has been denied the right to function as a trade union official on the job, which is a definite job performed by some other person.
§ It being half an hour after the conclusion of Business exempted from the provisions of the Standing Order (Sittings of the House), Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing Order, as modified for this Session by the Order of the House of 25th November.