NEW CLAUSE.—(Staff appointments.)

HC Deb 08 July 1946 vol 425 cc67-107

(1) All appointments of officials to the Corporation other than those for which the Minister is responsible in accordance with the provisions of Section one of this Act, shall be made only on the recommendations of an independent appointments board formed jointly by the Minister and the Corporation; and after the passing of suitable tests of competence.

(2) In the appointment of officials and the selection of employees for the Corporation and in the promotion of any such employees or officials no political test or qualification shall be permitted or given consideration, but all such appointments and promotions shall be given and made on the basis of merit and efficiency.

(3) Any member of the Corporation or appointments board who is found by the Minister to be guilty of a violation of this provision shall be removed from office by the Minister and any official of the Corporation who is found by the Corporation to be guilty of a violation of this provision shall be removed from office by the Corporation.—[Major Vernon.]

Brought up, and read the First time.

Major Vernon. (Dulwich)

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

This Clause is intended to remove what seems to us to be a serious objection to the Bill. It relates to the appointment of staff on the corporations. Everyone will agree that the success of this undertaking, as with almost any other undertaking, depends on the suitability of the staff employed—that is of extreme importance. It is not enough that people should be of excellent character and ability; their characters and abilities have to be adjusted to the functions which they have to perform. Looking to the past for examples, we find two methods in existence for appointing staff. One is the procedure in the Civil Service, and the other is the procedure of the joint stock companies. The Government had to choose either one or the other, or something between the two, which would combine the virtues of both and avoid the vices of either. It is because we feel that the Government have not been successful in doing this that this Clause has been moved.

The procedure in the Civil Service has been to have preliminary examinations set by the Civil Service Commissioners, then to sort people into appropriate Ministries or occupations. Promotion has always been by what were intended to be and what were fairly successful in being, impartial boards. The practice has been to advertise in the Press any openings for non-civil servants, and to circularise likely applicants where appointments were made within the Civil Service. This procedure has been followed through the ages, and defects which have occurred from time to time have been removed. This evolutionary process has come to fit pretty well. There has also been the possibility of Ministers in Parliament being responsible so that defects which occurred from time to time could be corrected. That is one method which has been tried as a going concern.

The other method is the procedure of the joint stock companies. The directors appoint managers, and they can give authority to appoint to lesser authorities who, at their discretion, make selections from their acquaintances or from applicants, and so it goes down to the shop superintendent and shop foreman in the case of factories. That system was also evolved through the ages, and it has developed characteristic checks. If a foreman selected an inefficient man as a charge hand, there was a possibility of a strike. If selection at the top was unsuitable, the efficiency of the organisation might go down, and questions might be raised at the meeting of shareholders. Competitive firms might be able to please the customers better, and the credit of the firm would decline—bankruptcy was the final sanction. That system has had a complete scheme of checks. In the present instance the Government have gone over to the private enterprise or joint stock company method, departing completely from the Civil Service method. As we see it, the defect is that the old checks do not exist. If things went wrong with a joint stock company it might fail completely, and there was always that test. B.O.A.C. has £10 million behind it, and the whole setup means that competition cannot exist. There is always some other background of finance to prevent this test of efficiency being applied. The Civil Service method does not apply so well, because it does not give sufficient freedom, and it does not allow rapidity of change which is required in a growing and a somewhat adventurous service.

We propose in this Clause that an outside body, appointed jointly by the Minister and the corporation, should do preliminary selection. There should be some impartial outside body to check the appointments. One can arrive at this conclusion from one's past experience. My own experience has been half in Government service and half in private enterprise. I have seen things going right, and sometimes I have seen things go wrong. I have proved this through the years, and it is for that reason that I have confidence in proposing some alteration in the Bill. My experience has been reinforced by experience of others.

Since I have been in the House, I have been shown letters from employees of B.O.A.C. complaining about the work of that organisation. They happen to have been passed to me for examination. I know none of these people myself, nor is this the experience of my friends or acquaintances; this is entirely documentary evidence. My conclusion, after examining these documents, was that there were many defects among pilots, navigators and administrative staff, and these complaints when traced back one by one pointed, in practically every case, to some unsuitable person in administration;: to an examination not properly conducted, or a person of experience being succeeded by an untrained outsider. Always you could trace it back to one of these people, appointed by someone above without any proper outside check. It is to remove that sort of trouble that we propose this new Clause.

Mr. Geoffrey Cooper (Middlesbrough, West)

I beg to second the Motion.

This new Clause proposes a fundamental principle of organisation which should be incorporated in undertakings of a public nature. It is essential that in an organisation which is run in the public interest, there shall be a sense of public. confidence in the way in which the organisation is carried on. The only way, as I, see it, that we can ensure that and have some confidence in the people who are appointed to these corporations is that they shall be required to pass some qualifying test. They should go through some procedure which could be recognised by the public and that would tend to avoid the suspicions which occur at the present time as to the way in which people are appointed to these public undertakings. It is not only to avoid suspicion, but it is to ensure a right and proper qualification, that this new Clause is proposed. I think that it is in keeping with the experience obtained during the war, when officers were promoted from the ranks in the Services. They went before Selection Boards, which were constituted on a recognised basis, and that gave confidence to the men who were still serving in the ranks, because they could understand the way in which a man was promoted to officer status. I think that is one of the reasons why there was a degree of success in the way in which the various Services were run, because the men who were the leaders had proved themselves competent as leaders by passing the necessary tests before positions of responsibility devolved upon them.

It has become a practice in industry and in the professions that people should pass. a recognised test. One has only to refer to the various professional bodies, who have. constituted their professional examinations, to realise this aim. I refer, for instance, to the Institute of Chartered Accountants. They have recognised tests, which are known throughout the world, and they result in a high degree of professional ability in the people who have the degree of Chartered Accountant after their names. The same applies to the Law Society. People are not entitled to practise law in this country unless they are qualified. This also applies to the architectural profession, in which people who wish to be recognised as authorities in their profession pass the examinations of the Royal Institute of British Architects. The same principle applies in the case of doctors and dentists.

If this new Clause is rejected, it could only be on the grounds that once a man is qualified by having passed the tests of some independent board, it would make dismissal difficult. I do not think that there is any foundation for that argument. In the case of a firm of chartered accountants, for example, who wish to have on their staff persons suitably qualified, the partners of the firm could quite easily dismiss any one of their staff. The fact that they have some specific qualification does not mean that the dismissal procedure is made difficult. It has been said, in the arguments put forward on the Committee stage by the Attorney-General, that this would interfere with the Board's independence, or their authority would be undermined, if it were laid down in the Act that people had to have certain qualifications before they could become members of the staff. I am not able to follow that argument. As I see it, the authority of the Board on the question of dismissal or appointment would only be subject to the right and proper check of an independent body of opinion, which could say whether or not poeple coming into the corporation measured up to a certain recognised standard. If it were found necessary to dismiss any of these people, the Board would have full authority to do so, without any reference to the Board, which, in the first instance, had passed the individuals out as suitably qualified.

5.15 p.m.

I would like to indicate some examples. The authority of the Minister is not in any way undermined by the fact that his civil servants have to pass the examination of the Civil Service Commission. I think that there is also a parallel in this case. In a firm of architects, if the partners are themselves qualified and they engage qualified staff, they can still dismiss any member of that qualified staff without in any way affecting their own authority. I would like to refer to the opinion of organised labour on this matter. People employed under executives are very sensitive to the qualifications and ability of those people who are in executive positions. In the report prepared by the Iron and Steel Confederation they say, in putting forward their proposals with regard to nationalisation, that the members would be appointed on the grounds of their competence to conduct the affairs of the industry. It goes on to say that they should hold office for a specified term of years, and should be eligible for reappointment, and that an age limit should be fixed for membership of the Board.

How are we to ensure that these very admirable ideas are incorporated in our nationalised undertakings? I suggest that we can only ensure that by setting up some independent board, of the type which this new Clause suggests. It may be argued by the Parliamentary Secretary, or the Attorney-General, that this sort of thing is unnecessary to be incorporated in an Act. I would like to refer to a previous experiment in nationalisation. It was not conducted in this country, but I think that it will tend to illustrate the principle incorporated in this new Clause. I refer to the Tennessee Valley Authority in America. Its chairman, Mr. David Lillienthal, made this statement on one occasion: In creating the Tennessee Valley Authority, Congress adopted and carefully wrote into law the basic principles and practices of modern management. I think that it is essential in Bills to set up nationalised undertakings, that we should endeavour to incorporate, wherever necessary, the main principles of sound organisation. This will ensure that these undertakings, which are of great concern to this country, shall be really successful.

Let me refer to other experiences of the past, because I think by learning from experiences of the past we can avoid a lot of mistakes in the future. From examination of the past we are able to avoid that initial period of trial and error which it is sometimes suggested nationalisation has to go through. I do not agree that it has to go through that sort of period which is so often described as a period of such successive errors that it is a continuous trial to everbody. I well remember in 1943 when the incompetence of certain people in senior positions in the Corporation was before the public. It was criticised in this House, and as a result of the criticism, which originated to some extent with the staff who felt that the leadership was not all that it might be, certain people holding senior positions resigned. They included such people as Mr. Walter Runciman and Mr. Clive Pearson, but certain people who were also implicated in the criticism did not resign —people who had they to pass such a test as is suggested in this Clause would perhaps not have ben liable to this criticism. Three of these people had been associated with an organisation which had already failed.

As I have said, that was not a suitable qualification for being associated with this new Corporation. They were connected with British Airways, which was a financial failure. One of them is still in the Corporation as director-general. One would expect that that particular individual would be exemplary in his actions on the questions of appointments and promotions. I should like to refer to "Staff Notes" issued to members of B.O.A.C. on 30th April, 1945, when the setting up of the new corporations was contemplated. I refer to "Staff Notes Nos. 15, 16 and 17" and I quote the following: Whenever these other companies, and then any companies in course of formation to run local internal services overseas, are formed, and the partners promoting them (amongst whom is B.O.A.C.) required help in the recruitment of staff, application will be invited by Staff Vacancy Notices and will be considered by the Promotions Board in the same way as if the appointments were vacant within the Corporation. It is quite clear that if anyone wanted to join one of these corporations like European Airways or South American Airways, the formation of which at that time was contemplated, they would have to pass the test of the Board That is right and proper, but then on 18th January, 1946, in spite of this being a staff notice and not having been cancelled, this particular individual, Major McCrindle, to whom I have already referred, in a letter referred to an individual who was a wing-commander, who was offered employment with B.O.A.C. with a view to giving him definite employment as manager of an associated company when the next vacancy occurred: The understanding is that this individual will come to the Corporation for three months to learn as much as possible of various aspects. He was previously Nitta Transport Command, I think Intelligence side, although I believe he has at times been responsible for staging posts such as Malta. Three months was the only qualification: suggested as necessary for this man to become a senior and responsible official—as a manager. This individual knew nothing about civil aviation and he could have known nothing about the position. to which he was about to be appointed. This letter went on: I would be glad if you would suggest a syllabus to enable him gain as wide practical knowledge as possible of the Corporation's affairs, e.g., operations, commercial and accountancy, A board was formed within the corporation to avoid people being given appointments in this way, and then immediately afterwards a member of the board of directors himself overrides the provisions of the board's communication to the staff. How could it be expected that the staff would respect the deliberations of these internal bodies, and it is for that reason that we suggest in this Clause that there should be an independent and external board to check the qualifications of members about to be appointed to the corporations.

I referred to three people who proved in the past their incompetence and yet were allowed to continue in senior positions. It is these people who are making selections to the Corporation at the present time. There is Mr. Campbell Orde, whose particular defects were criticised by the British Airline Pilots Association. He was responsible for sending Whitley aircraft on a trip to West Africa for which insufficient petrol was supplied. Only one aircraft completed the trip and the, others returned with the task incomplete. One man did get through by sheer good fortune and he had only half an hour's petrol when he arrived at his destination in Bathurst. The individual responsible for that operation is now advising the Chairman, Lord Knollys, what sort of aircraft the Corporation should buy. This incompetence makes the position quite ludicrous and must not be permitted to continue in the new corporations. Again I suggest that if these people had had to pass a board in regard to their qualifications they would not get appointments in the corporations in this way. The third man, Gerald d'Erlanger, I know carried out duties with A.T.A. I know that is no yardstick by which to measure efficiency or otherwise, but he was on the Board of British Airways which failed. These illustrations I give, I suggest, are sufficient to substantiate the absolute necessity of incorporating in the Bill the new Clause which is on the Order Paper.

I want to refer now quite briefly to the question of promotion, because I have received a number of letters from men whose competence in the past has been proved, and who can make no headway at all in the corporation due to this overweight of incompetence at the top. I want to refer to one man who has years of flying experience and who has probably 'completed more trans-Atlantic flights than any other man in this country. He lost his job. He has no chance of getting into the corporation because the directors choose to select men who have got no qualification in civil aviation. That is to say, the Board appoint others instead of the men who have proved their competence in the way they carried out their job in the past. This particular individual is not only competent as a civil air line pilot, but has studied airline operations technique, which is very rare. I know that this man could, without any trouble, obtain a job in the United States, and he has, indeed, been offered such a job. We should not be letting men like this depart when we need them for civil aviation in this country.

There is another case of a flight-lieu-lieutenant who won the D.S.O. and the D.F.C. during the war and had other experience as well as with the R.A.F., but he was given no chance to make progress in the corporation because other men were promoted over his head. There was another case of a man who at Oxford University got his degree of Bachelor of Arts with a first class in mathematics and a second class in Modern Greats. He has been superseded by men who have no similar qualifications. There is a further case of a man who left the R.A.F. with his assessment as a pilot as "exceptional," also as an R.A.F. test pilot as "exceptional." These qualifications in the R.A.F. are not given lightly. Once again that man cannot obtain employment in the corporation.

Mr. John Lewis (Bolton)

It does not follow that if a pilot excels in operational duty with the R.A.F. he is highly suitable for civil aviation duties.

Mr. Cooper

I am very conscious of that and I am glad my hon. Friend intervened on that point. It is not necessarily an indication that a man who excels with the R.A.F. in operational duties is suitable for civil aviation duties, but in this particular case this individual was a civil air line pilot before he was an R.A.F. pilot, and he also undertook an executive position with creditable results. I think it can be shown to an overwhelming degree that there is need for a board to be set up under the provisions of this Bill similar to that which is suggested on the Order Paper. It cannot be argued that to incorporate this new Clause would be contrary to Government policy, because I can quote the Lord President of the Council in this respect. Speaking in the Debate, on the iron and steel industry as recently as 28th May, he made certain proposals with regard to people who should be appointed to nationalised undertakings. My right hon. Friend agreed with the Opposition and with the right hon. Gentleman the Member for the City of London (Sir A. Duncan). My right hon. Friend said: …the right hon. Gentleman was absolutely right in saying that it is vitally important—in this industry particularly, indeed it is vital to all industries—that there should be, as he said, a responsible, creative flexible management. He said that it was difficult to get that, but that we must get it. I entirely agree with him, and I undertake to the House that the Government will make every endeavour, and strive with great energy, to see that this industry gets just that kind of management. 5.30 p.m.

If the Government are to do that, then one of the simple ways of doing it is to incorporate this new Clause in the Bill. My right hon. Friend then went on: It is often assumed that, when an industry becomes publicly owned, somehow or other it cannot be efficiently served. What does a limited liability company do when it wants to get people to run its undertakings? It really must not be assumed that the average director manages the affairs, or indeed the average chairman, though some of them do. What the joint stock company does is to go out into the market and buy brains, skill, technical knowledge, managerial ability and proletarians. The State can do the same; the public corporations can do the same, and these are going to be public corporations, business concerns; they will buy the necessary brains and technical skill and give them their head.''—OFFICIAL REPORT, 28th May, 1946; Vol. 243, c. 1118–1119.] That is a right and proper statement to make; I do not think anybody would disagree with it. But how is it to be implemented? I suggest by the Government adopting the proposal we have put forward in this Clause. I trust we shall hear from the Parliamentary Secretary that it is the Government's intention to incorporate this Clause in the Bill or, if they do not like the form of words, such words as will do what we require.

Air-Commodore Harvey

I do not go so far as the hon. Member for West Middlesbrough (Mr. Cooper) but, nevertheless, I think this matter requires consideration. I think it is generally agreed on both sides of the House that the existing directors of the corporations know little or nothing about civil aviation, with one or two exceptions. In the corporations there are pilots and men on the technical side of the business who have been flying for 20 or 30 years, men with good administrative knowledge and ability. Instead of being allowed to go on flying until they are 50 years of age, and until they have failed their medical boards, they have been given a small pension and have had to look for jobs outside. That is a great waste of good men. I hope the Minister will see whether he can do something about this matter. I would like to know how the Government propose to select the directors, because it is a rather hit and miss business at the moment. There should be a more clearly defined policy——

Mr. Ivor Thomas

In case the discussion gets on to a false basis, I should like to point out that this Clause has nothing to do with the appointment of directors. They are, in fact, specifically excluded.

Sir Wavell Wakefield (St. Marylebone)

Is not a director of the company an official?

Mr. Thomas

The Clause says: All appointments of officials to the Corporation other than those for which the Minister is responsible…

Air-Commodore Harvey

I was following the point made by the hon. Member for West Middlesbrough, that the Minister should get young men, not men of 68 years of age.

Group-Captain Wilcock (Derby)

I am sorry that I cannot agree with my hon. Friend the Member for West Middlesbrough (Mr. Cooper) in much of what he says about the present administration. He has, in my view, quoted the wrong examples. I do not think it right that he should base his case on Campbell Orde, a distinguished pilot who has had considerable experience as an air line pilot, and d'Erlanger, who has great experience in management of aircraft and personnel. Nevertheless, I agree with my hon Friend that this question of a board is worthy of consideration. I put that view forward because I believe it would hap those whose duty it is to make selections to be able to refer to the board people who apply for positions. In flying, and aviation generally, there is a lot of sentiment—and this must be. It is not at all easy for one in authority who is approached by an ex.R.A.F, pilot, or an ex-R.A.F. wireless operator, with whom one may perhaps have served for many years, including operational service during the war, to turn down a man who claims his help. I believe those whose job it is to make selections for the new corporation would welcome a preliminary board such as is suggested in this new Clause.

I must further criticise my hon. Friend for saying that certain pilots have not been accepted by the corporation although they have distinguished records. There is a period of conversion-flying which must be undertaken by all Service pilots before they can be considered as suitable airline pilots. They must undertake this flying, no matter how distinguished their flying record, and they must possess a "B" licence which very few Service pilots hold. It has been noticed that, in training pilots and air crews for Transport Command work, an operational pilot may not necessarily be the best man for transport work. I think we must allow the corporation to decide who is the right man and who is not. I would not suggest that the board should necessarily be one with the Minister's representatives on it; I think it would be better if the board was not composed of the people who are concerned in the actual employment of the personnel. British European Airways have a board and it "vets" all applicants for employment, and the results are most encouraging. In all corporations, however, there is one weakness which has been mentioned, namely, that the higher executives do not have to go through that process and I believe that except for the highest appointments preliminary selection by a board will help towards the efficiency of the new corporation.

Sir T. Moore

I have read this Clause carefully, and I have listened with dose attention to the speeches which have been made. As a result, I am gravely concerned and disturbed at the somewhat sinister implication behind the speech of the hon. and gallant Gentleman the Member for Dulwich (Major Vernon). Does he infer that there must be, inevitably, political log-rolling and graft in our nationalised services? Undoubtedly, that is what his speech led me to understand. I feel that it is casting a very improper reproach on the members of the corporations. So far as I understand it, they are commercial undertakings, and any commercial undertaking can set up their own board to select, if they so choose, their own staff. Such a board will, obviously, select the best men, and make sure they are worth their pay. If they do not select the best men the corporations can be changed by the Minister. But why drag in the Minister at all? He already figures too much in the Bill. We see from the terms of the Clause that the appointments board must be formed jointly by the Minister and the corporation. If we are to try to establish corporations with some individuality and independence of their own, as we on this side of the House would wish, surely there should be no Ministerial interference with them. They should be allowed to form their own boards within their own organisation, if they so desire. I regret the introduction of personalities into this Debate. The names of persons have been given, and those persons cannot defend themselves. The hon. Member for West Middlesbrough (Mr. Cooper) is privileged——

Mr. Cooper

May I point out that on several occasions opportunity has been given for information coming to the Minister to be looked into? Continuously there has come to me undeniable evidence of the inefficiency of these corporations. I, personally, regret having to refer to personalities. Any hon. Member refrains from doing that if it is at all possible, but the overriding loyalty, as I see it, is to the efficiency of our airlines in this country, as distinct from some petty loyalty to some individual who may or may not be efficient in his job.

Sir T. Moore

I cannot accept that; there is a far bigger question involved. The petty side of the matter, as the hon. Member said, could easily be adjusted between him and the Minister. I wish to point out to the hon. Member—and perhaps, after he has been in the House longer, he will understand this—that he speaks in a privileged capacity and in a privileged building, and that nothing can be done by the people concerned to safeguard their reputations against such charges. Inevitably a stigma will be attached to their names. Therefore, with due good will, I hope the hon. Member will avoid in future doing things which might tend to make us feel rather ashamed of this great historical building in which we deliberate.

The main point I wished to raise was the sinister implication that there must inherently and inevitably be graft and corruption attached to nationalised services such as civil aviation. I hope the Parliamentary Secretary will say something to reassure us that no such implication is contained in this new Clause, whether we accept it or not.

Mr. Cooper rose——

Mr. Speaker

The hon. Member has no right to speak a second or third time. On the other hand, if he wishes to make a personal statement, I think the House will allow him to do so.

Mr. Cooper

It is for that purpose that I rise, Mr. Speaker. The hon. and gallant Member for Ayr Burghs (Sir T. Moore) has made a rather serious reflection on me. I would point out that it was after going through every other possible channel of approach to get things put right in these corporations that I was driven, eventually, to take this step. I did so with due regard to the privilege of the House; otherwise, I would not have dealt with the matter in this way.

Mr. Lennox-Boyd

Would the hon. Member repeat outside what he said against Mr. Campbell Orde?

Mr. Cooper

I think there is no need to do that. The information I have is absolutely unimpeachable, and unless it was of that standard I would not have used it in the House.

5.45 p.m.

Mr. Thomas

If the information is absolutely unimpeachable, there should be no objection to repeating it outside the House. This new Clause simply shows how curious and unaccountable is human nature. Time and time again we have been urged to make these corporations commercial undertakings and in way to have civil aviation run by civil servants. What we are being asked to do in this new Clause is to assimilate the corporations to the Civil Service and to set up a kind of Civil Service Commission to make appointments to the staff. The hon. Gentleman the Member for West Middlesbrough (Mr. Cooper) wants us to write a new general confession. He wants the B.O.A.C. to say that they have appointed those whom they ought not have appointed, and failed to appoint those whom they ought to have appointed. A defence has already been been made of several of the gentlemen named, but it might be misunderstood if I did not mention one person whose name was left out, because I happen to be in a special position to refer to him. I speak of Major McCrindle. He has accompanied me on several missions abroad, and I have found his advice of the greatest help in dealing with other countries. With regard to persons who have failed to find appointments on the corporations, all of us have sometimes failed to get appointments which we considered ourselves to be the best persons to fill. When we were young we took umbrage, but as we grew older we knew it was the way of the world and we ceased to take umbrage.

The new Clause asks for two things. The first is that there shall be tests in the appointment of members of the staff of the corporations. That is an idea which makes me shudder, if it is meant that there should be an examination. I am not clear from the new Clause what is meant, because it does not specify details. The idea has been canvassed on different occasions. It has been suggested that we might have examinations for membership of this House, and no doubt there is a case for that, but I dare say that many of us who have secured the votes of a majority of our electors would fail to secure elections in such circumstances. Quis custodiet ipsos custodes?What guarantee have we that the appointments board which is to make these infallible appointments would itself be so good, and would set the right tests? That is the first argument, that there should be tests for membership of the staffs of the corporations; but I do not think there is any conceivable test that would be satisfactory as a method of selection. The hon. Gentleman mentioned several examples, but it will have been noted that they were all taken from the professions—they were cases of civil servants, dentists, doctors, barristers, and so on—and they are not really applicable to this great industry, which is more in line with commercial undertakings?

Mr. Cooper

Why?

Mr. Thomas

I wonder what sort of test would be set for the running of an airline corporation. I have had some experience of this business, and I should not like to set the examination paper. I am not competent to do so. The other point in the new Clause is that there should be an appointments board. This is an idea with which I feel a great deal of sympathy. In a large organisation, I think there is a very strong case for having appointments made through a board, if only to avoid overloading any particular official. A recent advertisement which my Ministry put out for airport managers brought in 3,000 replies at once from civilians, without taking account of several thousands brought in through the Services. It is a formidable task to sift these applications, and it is very reasonable that it should be done, in a large organisation, through a board. In fact, it is being so done in B.O.A.C. and in B.E.A. In B.O.A.C., which is, of course, an exceedingly large organisation, with a staff of about 21,000, there is an Appointments and Promotions Board which makes all appointments to salaries between £400 and £1,000 a year. Appointments at salaries over £1,000 a year are made by the board of the corporation. It was suggested in Committee that there was a little subterfuge whereby a person might be appointed at just below £1,000 say, £980—and that a little later, once he was in the corporation, he would be promoted to over £1,000 a year. I have had inquiries made on that matter, and I have not found a single instance.

Mr. Cooper

I can give the Minister examples of that if he needs them.

Mr. Thomas

I made inquiries, but I am willing to have the examples, and to consider any evidence. There is in existence this Appointments and Promotions Board which sees applications for all posts between £400 and £1,000 a year. Above £1,000 a year, the appointments are made by the board of the corporation itself. Below £400 a year they are made by the departmental heads, and a very large number of new entrants come in, but between £400 and £1,000 a year the general rule, which I think a good one, is to promote rather than to bring in new staff, and persons in the corporations get preference if possible. If there is no suitable person available within the corporations the Appointments Board discusses with the departmental head whether the post should be advertised internally and externally; in any case, it is always advertised internally.

Mr. Cooper

May I ask the Parliamentary Secretary how he reconciles what he has just said with a quotation I made during the Committee stage from an official report by the Ministry of Labour, which said quite definitely: The general complaint is that people with little or no technical, commercial or administrative ability are continually brought in to fill executive posts, over the heads of properly qualified employees with long and able service.

Mr. Thomas

I do not intend to discuss that particular report for reasons which the hon. Gentleman well knows. It would be very undesirable that I should do so, and I am not prepared to be drawn away from my arguments for the purpose. As I have shown, the machinery exists in the British Overseas Airways Corporation. In the case of British European Airways a similar piece of machinery will be set up; indeed, there is already an appointments board. B.E.A., of course, is now being formed within the B.O.A.C.; it has no legal existence yet, and naturally some people have to be taken from outside by direct appointments at the present time, but it is the intention, when B.E.A. becomes an independent legal entity, to have its own appointments board on similar lines. British South American Airways is a smaller organisation; the present method of appointing members of the staff is that there is an initial interview by the personnel department which sorts out the applicants into categories. Applicants are then sent to the head of the Department concerned who either accepts or rejects them, after which they return to the personnel department for appointment or otherwise. If appointed, their appointment is subject to confirmation by the chairman or managing director and a formal letter of appointment follows. I understand that this is working very well and I have not heard a complaint from the hon. Gentleman about that particular corporation.

Those are the existing arrangements, and I think they comply to a large extent with what the hon. Gentleman desires, but with this essential difference. These are internal boards set up by the corporations, whereas the hon. Gentleman wants. a board set up by the Minister and the corporations jointly. We have been repeatedly and, I think, rightly urged to, give these corporations their independence of management. If they are to make a success of their commercial undertakings they must have independence of management, and to impose upon them a board of this character would be the most. serious infringement of independence of management that I can imagine. They must be free to appoint their own staff; if they choose to do so by appointments boards I believe myself that that would be an admirable way, but it is for them to decide.

Finally, would the suggested appointments board get the results that are desired? We all want to see these corporations having the best staff they can obtain, but would appointment by a board of the kind proposed be any more satisfactory? The hon. Gentleman's new Clause looks towards the Civil Service Commission as a model, but in recent years that body has been subjected to a great deal of criticism. I do not intend to say whether I regard this criticism as right or wrong, but it is a fact that certain changes have been made in recruitment to the Civil Service. Within my recollection in the House a Bill was introduced to provide for the foreign service, for example, which made certain changes, and there is a widespread feeling—not to put it more strongly—that it should be possible to bring persons into the Civil Service by different methods in many cases from those now adopted, and that a person who has been in industry, for example, should be brought in. I use this only as an illustration and make no endorsement. I am not pursuing the argument but merely saying that this new Clause is modelled on the Civil Service Commission, and in fact——

Mr. Cooper

What about the Army Selection Boards?

Mr. Thomas

The Army Selection Boards are very different, and I see no reason here for an analogy with them. I should have thought that the Clause was modelled more on the Civil Service Commission. In any case we have had a great deal of heart searching on this subject in recent years and I think it is obvious that a large body of public opinion would not agree with the hon. Members who have moved and seconded this Clause.

Major Vernon

I tried to explain that I sought to incorporate the virtees of both systems and the vices of neither, but that I did not want to go into the details of the difficulties of the Civil Service Commission. It would be understood that in recasting the whole thing one should examine both systems and incorporate only that which was suitable and appropriate.

Mr. Thomas

I am inclined to think that what the hon. Gentleman has succeeded in doing is to incorporate the vices of both systems. The hon.. and gallant Gentleman the Member for Macclesfield (Air-Commodore Harvey) has raised the very important question of pilots who have passed the flying age, and I am fully in agreement with him that some better provision should be made for the future of such pilots than is now the case. I would not agree that they are paid off with a small pension; in fact, I regard it as generous. What I should like to see would be some measures by which pilots gained administrative experience in their last years of flying and could then carry on in some ground job for the rest of their lives.

Sir W. Wakefield

The Parliamentary Secretary has given the House a very full explanation of the way in which personnel are selected by the B.O.A.C and the corporations, and he has told us of the great care which is taken and of the ways and means adopted by these corporations to secure the best personnel. I should like to give support to the idea of indepen- dence of management for the corporations. I think it really is quite hopeless to introduce Clauses such as that which has been introduced by the hon. and gallant Member for Dulwich (Major Vernon) which would take away responsibility from the corporations. Again and again the Minister has said quite rightly that these corporations are to be as in dependent as possible of Ministerial interference. In this Bill the Minister repeatedly takes upon himself responsibility and does in fact interfere. In this proposed new Clause the Minister would be brought in once again, and I must say that I very much welcomed the fact that he was not to be brought in in this particular instance, because successful operation by the corporations is to a very great extent dependent upon the proper selection of personnel. If we take away from. those who are directing the work of the corporations their responsibility for selecting personnel, we might just as well do away with the corporations themselves. It is their main function to select personnel, put them into the right posts, see that they are happy, and are doing their job efficiently and generally to be responsible for the supervision of the work which those people are doing.

6.0 p.m.

If we bring within the responsibility of the Minister and of this House the detailed circumstances of appointment of staff, review of its work and so on, we shall get the very kind of thing which hon. Gentlemen opposite raised a little while ago, such as names of people being mentioned across the Floor of the House, and most unfortunate repercussions. That is one of the weaknesses of the whole scheme of nationalisation. We want the Bill to be as good as possible. The more we can remove it from that weakness the better. the Bill will be, as far as I can see. That is one of the reasons why I oppose the proposed new Clause. I feel that if such. a provision existed, much useful time would be improperly taken up in this House with the raising of points of a political nature which ought to be discussed, considered and undertaken by the proper organisations dealing with staff within the corporations. I hope that matters of this kind will be kept outside Parliament, and will be dealt with by the organisation within each corporation which, as the Parliamentary Secretary has said, is adequate for the purpose.

Wing-Commander Millington (Chelmsford)

It seems to me that the hon. Member for St. Marylebone (Sir W. Wakefield) and the Parliamentary Secretary did not properly read the first Subsection of the proposed new Clause. It does not suggest that appointments of staff should be made by the Appointments Board, but should be made only on the recommendation of the Board and after the passing of suitable tests. If I can read correctly the minds of the mover and seconder, they want to pass into law something which is already happening in the B.O.A.C. in a rather haphazard way, as was described by the Parliamentary Secretary. He rightly said -that the big industrial organisations perforce must have a large appointments board to sift the 3,000 applications that they get for every one job. There are many parallels to that. All we are asking is that there should be a statutory obligation for such boards to be in existence in the corporations in order to see that those who make the final appointments have much of the preliminary sifting work taken out of their hands, and have a clear indication of the kind of people available for the job for which there is a vacancy.

I would ask the Parliamentary Secretary whether it is a fact that one of the difficulties which corporations are meeting today is shortage of applicants for many of the jobs which are on the market. I am referring in particular to flying jobs. Is it not a fact that only one of the corporations is up to its quota of flying personnel, the British South American Airways Corporation, and that in spite of the fact, as the seconder pointed out, that men with very fine R.A.F. qualifications are not getting a hearing? The corporations have, in fact, a serious shortage of applicants, in particular for aircrew duties. The fact has been brought out in the Debate that a chap who was a flight-lieutenant and got the D.S.O. and the D.F.C. for operational flying, finds that in itself that is not a qualification to make him a good transport pilot. Personally, I have flown aircraft in operations throughout the war, but I would be an exceedingly bad pilot for civil aviation because I have certain deficiencies of temperament, which were not deficiencies only a year or so ago.

I am asking that men with good war flying records should be able to go to some independent body which would have laid down tests against which men could be measured and by which they could be told whether or not they had the qualifications for the kind of job for which they were applying. As it is now, tens of thousands of aircrew men are coming out of the Forces feeling that they are not being given an opportunity in civil aviation. Because of that there are rumours, which spread very rapidly in Service circles. There is a rumour that there is a dead hand on the B.O.A.C., stifling promotion and controlling appointments, and that unless you have a cousin or a friend in the right place it is difficult for any man to make his way up, on merit, through the B.O.A.C. to a position of responsibility.

Quite recently, I went by air mail service to Northern Ireland. I was held up by a storm at a place where I talked to a man who said he had more than 20 years' service in civil aviation. I asked him what his future would be. It is rather obvious that a man with more than 20 years' service has not much future. He said, "I am going on pension before I am much older. My eyes are failing, and the corporation will not consider giving me a position in the office." That fact might have been due to the people who make appointments being rather busy, if they are getting 3,000 applications for any one specified job. If the proposed board were created by Statute, every man applying for a job would be certain that a clear standard had been laid down and that he would get a fair hearing from an independent body. I therefore ask the Parliamentary Secretary to give a second thought to this matter. There is agitation in this industry that the industry is being stifled of proper applicants because of the ugly rumours of the way in which applicants are treated.

Mr. Lennox-Boyd

This is becoming a very interesting Debate. We have had from the Parliamentary Secretary a fascinating account of the revolutionary technique adopted by Government-sponsored corporations. We are told that application would either be answered or not—and any person who has had recent experience of corporations would not have much doubt what the answer would be. Then the applicants are either sent for to be interviewed, or not, and then, after the interview, they are either appointed or they are not. We who support private industry are encouraged by those most valuable tips in efficiency and business technique, which ought to stimulate enor- mously the export drive for which His Majesty's Government are now taking all the credit.

The Parliamentary Secretary also made a series of observations about the Civil Service Commission and the Commissioners. It would be interesting to know whether those observations represent official Government policy. A party which has long held the view that only by closed shops can justice and efficiency be achieved should not want to disturb the practice by which the Civil Service higher posts have always been given to civil servants. I do not know whether the hon. Gentleman was speaking with the full authority of his party, or whether it was one of those excursions into the stratosphere in which, in the absence of any proper air service, the hon. Gentleman is entitled to indulge from time to time.

We listened with very great interest and sympathy to the speeches made by the hon. and gallant Gentleman the Member for Dulwich (Major Vernon) and the hon. Member for West Middlesbrough (Mr. Cooper). They are obviously anxious to see that the best men are appointed to the corporations, whether as employees or staff. We join with them in that desire. They are anxious to see, for example, that this does not become a racket in which, to use the modern phrase, "Jobs for the boys" becomes one of the slogans. They are anxious to see also how this will be achieved, and whether adventurous spirits are brought in as employees of these corporations so that they do not suffer from any bureaucratic control, and they are also anxious to see that what they call the period of trial and error, shall not be applied to the new corporations. Many of us, when they tell us there will be no period of trial and error and know that no business enterprise can miss that preliminary stage, are convinced that they will glide miserably and straightaway into the heart of error itself.

Mr. Cobb (Elland)

If the hon. Gentleman had any experience of industrial administration, he would agree that preliminary planning in many cases decreases the need for a period of trial and error.

Mr. Lennox-Boyd

Of course that is so. We would be glad to participate in careful preliminary planning, but it is the entire absence of any such planning and the inevitability of never coming to a proper decision which will inaugurate these corporations in a most inauspicious way. The hon. and gallant Member for Chelmsford (Wing-Commander Millington) has very rapidly left the House. As a recent recruit to the Labour benches, he probably feels that his contribution could have been improved upon, arid he may be thinking of rejoining the remnants he so recently left. He certainly gives us no indication that these corporations are going to start their work in an atmosphere of good will. He said there was a universal feeling among the pilots that some sinister influence from: outside was preventing proper promotion and reward for talent. All the speeches from the other side have illustrated the dilemma which is bound to confront the Socialist Party in the future—as soon as the only real test of whether one has made a good executive appointment or not is removed—the test shown by the profit and loss account. The dilemma is this. Does the House, and do the hon. and gallant Gentlemen, trust these corporations or not? If they trust these corporations, then it is not unreasonable to leave to the corporations the selection of their own staff. They talk as if these corporations were not, as they are, composed from time to time of distinguished members of the Socialist Party. Do hon. Gentlemen opposite not trust Lord Rothschild, who was recently appointed, to come to a wise decision; or a distinguished former Socialist Member, Mr. Garro Jones; or the late Mr. Marchbank, a respected trade union figure? If these people, who were we thought Socialists deserving of a brave new world, can be relied upon to adopt sensible arrangements, they should be relied on. If they cannot be trusted, it is quite right not to leave appointments to them, but to hamper and control the corporations at every turn, leaving the main function of management, the choice of staff, to some outside body. If hon. Members cannot trust the corporations, why set them up?' We are entitled to pose this dilemma. It is a dilemma which will exist and continue to develop for all Socialists—an eternal dilemma for that brief space of eternity for which the Socialist Party will be responsible.

Mr. John Lewis

During the war we trusted our generals, air-marshals and admirals. Were they allowed, in their circumstances, to appoint their own staffs, or were their men commissioned through the ordinary selection boards?

Mr. Lennox-Boyd

If the hon. Gentleman repeated outside to Field-Marshal Montgomery that he came to a Government Department in order to know who should form his "inner circle" of trusted advisers with the Eighth Army, he would get an answer in a well known military phrase.

Mr. Lewis

This covers all appointments, surely?

6.15 p.m.

Mr. Lennox-Boyd

Equally this Amendment covers all appointments. The most trusted advisers of the corporation would, according to the new Clause, be appointed in that particular way. We are going to introduce——

Mr. Cooper

I think the hon. Gentleman has got his argument quite wrong here. I thought we had made it quite clear that the intention is not to take away from the Board their power of appointment, but only to ensure that the people appointed will be from a class who have passed certain essential tests.

Mr. Lennox-Boyd

I am not opposing that. I am posing the dilemma which is bound to arise. It is an inescapable dilemma. Under the new Clause it might be possible for the corporations to be obliged to pay a certain group of people appointed by the selection process outlined there, but there is no obligation whatsoever to employ those people in any capacity at all. We might find a parallel to the ridiculous situation which has arisen as a result of the reinstatement requirements, in which employers reinstate people but give them no work to do. I am not opposing the new Clause, but only asking the House to pause and consider the implications of this dilemma which runs right through this Bill and will confront every Socialist Government in the future.

There is a further point we are entitled to make. In order to avoid the wrong people being appointed, are hon. Members opposite anxious to take to themselves the right to criticise individual appointments here in the House of Commons? This ought to strike a warning note. I suggest to the hon. Gentle- man, who certainly does not lack courage, that he should repeat outside something he said about Mr. Campbell Orde. What is to happen when all our activities are controlled and directed by a Socialist industry or a State controlled corporation, when every appointment is subject to criticism in the House of Commons by people who are wholly privileged and against people who have no similar right of protection in reply? When this happens, we shall find that more and more good people will refuse to serve with corporations of this kind, if they can be blackguarded in the House of Commons without any proper opportunity to give their own answer in return. I suggest to the hon. Gentleman—it is a perfectly fair suggestion—that he should make that sort of observation outside.

These difficulties never arose in the bad old days which made us the greatest trading nation in the world. They are caused by theorists attempting to take over the control of all our industrial life. These difficulties will occur in growing numbers. There is no common form under which these appointments are being made and no apparent central direction. In the case of the Coal Board, it is impossible to know how members of the staff will be appointed and what their functions will be. Through the Parliamentary Secretary and the Attorney-General, we have got a little more information in this case, but there is no common idea running through all these corporations. We have the feeling that we are living from hand to mouth, and that every day the Government, in response to any particular pressure from one side or the other, change and adjust the machinery they had in mind, not in order to meet the different circumstances in different industries, but in order to placate some particularly noisy opposition of the moment. So much for the general dilemma which will confront hon. Gentlemen opposite so long as they are a Government.

This Clause proposes that there should be no compulsory membership of any political party for any employee of the corporation. If that were accepted, would it also apply that there should be no compulsory membership of any industrial organisation that was affiliated to any political party? Some of us thought that about the most shameful thing that had happened in recent months was the action of the union concerned which deprived two excellent servants of the London Passenger Transport Board of the opportunity of walking in the Victory Procession. They had been chosen by their colleagues and had served in two wars with great heroism, but they did not belong to some union. Arc those to be the rights of the working men in the new Socialist Utopia? Will compulsory membership of any particular organisation be demanded as the price of an appointment to the staffs of the corporations? Would members appointed by the corporations be entitled to stand for the House of Commons? We know that any member of the board who becomes a Member of the lower House of Parliament—it does not apply to peers for there are already two peers on the board—would cease to be a member of the board, and that no Member of the lower House may be appointed to the board. About the staffs, however, we have no information at all. Would it be possible for the employees or the clerical staff to stand for Parliament? Or will the threat of the Minister of Fuel and Power, that it would be impudence for a colliery manager to stand as a Conservative, be applied also to those who work for these State sponsored corporations? Naturally the corporations must be free, when a member of their staff is elected to Parliament, to say whether or not membership of the House of Commons conflicts with his duties to the corporation, and it might well be that it would so conflict. What we are concerned about is the right of any individual to stand for Parliament even though, when elected, he may have to make up his mind between his two obligations. That is only one criticism of a point of detail. On the general issue, we on these Benches have been fascinated to see the working out of this problem which will perplex the Socialist Government for the remainder of its brief life and will undoubtedly bring about its eventual collapse.

Mr. Ivor Thomas

The hon. Member for Mid-Bedford (Mr. Lennox-Boyd) can be trusted to make the utmost political capital, and to get the utmost amusement, out of these occasions, and I would not grudge him that pleasure. The questions he asked are questions which I am not called upon to answer, because I suggest they are hypothetical, as I hope the Clause will either be withdrawn, or, at any rate will not be accepted. I can agree very much with the hon. Gentleman in deprecating attacks on individual members of the corporations by name in this House, or on the staff of the corporations generally. It puts those staffs in an unenviable position when they are the subject of continual sniping to which they cannot reply, and it is really destructive of their morale that they should be subject to such attack. The hon. Gentleman said that the real test in the old days was the profit and loss account. Well, the profit and loss account will still be available in the future. If any Exchequer grants are made to these corporations the exact sum will be known. The test remains. I should not put the argument in such a materialistic form myself, but I do say that the real test will be results. I should not measure them in quite the same way, and my answer to the attacks made on the members of B.O.A.C. and other corporations must be that great results have been obtained. It is remarkable, for example, that throughout the war years not a single day's work was lost in B.O.A.C. through labour troubles. If there had been any serious discontent in the corporation, that could not have been the case.

The hon. and gallant Gentleman the Member for Chelmsford (Wing-Commander Millington) raised one question which I should like to answer. He asked me if it were not the case that there was a shortage of aircrews at present in the corporation. There is a paradox here. It is true that there is a shortage of trained aircrews at the present time, but their recruitment is almost complete. The explanation of the paradox is that it takes quite a long time to train aircrews, but ther is, in fact, no actual shortage of applicants for posts as aircrews with the corporation.

Mr. Cobb

One or two hon. Members have mentioned the corporations' responsibility and have said that if this Clause were passed, the corporations' responsibility would be destroyed. I do not believe that any of the speakers on this side wish to undermine the corporations' responsibility, but would like to see them acting with the greatest responsibility. What I suggest we have in mind is that it is an unfortunate fact that over the last half century nepotism in British industry has increased. What we are getting at is that this influence on British industry, which is very largely responsible for the failing efficiency of British industry, has permeated these corporations. There is no doubt that when this happens the spirit of the staff is affected and they are frustrated when they see people being brought in over their heads, when people at the bottom are not promoted, when selections for the top jobs do not come from inside the corporation. I would like to give the Parliamentary Secretary an example in my own experience, under a public corporation set up and run by the Tory Government of the day, and I would like particularly to address my remarks to the hon. Member for Mid-Bedford (Mr. Lennox-Boyd). It is, in fact, a dilemma which faces any large-scale organisation. This criticism cannot be levelled at the B.B.C. today but it could have been levelled at the B.B.C. some time ago.

I was an engineer in the B.B.C. and there is no doubt that the engineering staff of the B.B.C. of that day, and a number of their other employees, were exceedingly dissatisfied and disgruntled. The reason was that the operation of the B.B.C. in promoting their staff was an example of the kind of thing that my hon. Friend the Member for West Middlesbrough (Mr. Cooper) has voiced today. It became so bad that, when I left the Corporation in 1926, I was asked what was wrong with the staff. The management of the B.B.C. of that day did not know and could not find out, and the upshot of it was that when the "talkie" industry started in this country, the B.B.C. very nearly shut down because the engineering staff went out en masse because they were so disgruntled.

I suggest to the Parliamentary Secretary that he ought to give another thought to this matter. It is a real difficulty in running any large-scale organisation, whether it be operated under private industry or under public control, and if he does not see that the staff is satisfied, that the organisation is democratically run, and that the staff have opportunities of promotion from the bottom to the top, then we shall not achieve the efficiency we want in these corporations, and we shall not give the service to the travelling public, which is the real balance sheet test of these organisations, that we, as Socialists, want to see rendered to the public of this country.

Mr. John Lewis

I would like to lend my voice in support of the suggestion that the Parliamentary Secretary should give more consideration to this matter. I agree with the hon. Member for St. Marylebone (Sir W. Wakefield) that we must maintain independence of management in this matter. It is quite impossible to conceive of any efficient organisation where the management is not in complete control of those people to whom it delegates responsibility. However, in this instance we are only suggesting that in respect of the people who shall ')e appointed to this Board there shall be a means of ascertaining whether or not they are suitable, and that they should not be able to obtain these appointments by what the hon. and gallant Gentleman the Member for Ayr Burghs (Sir F. Moore) described as the "sinister method of log rolling." He knows quite well that in British industry today, as well as in American industry and indeed throughout the world, people who are wholly unsuited for carrying out the managerial functions which we are discussing, are appointed to high executive positions because they are either the sons or the friends of people who hold positions of responsibility and are wholly unsuited on the test of merit to occupy these posts.

Sir T. Moore

The hon. Member must be exceedingly unfortunate in those he has met; I have not had that experience.

Mr. J. Lewis

Possibly I have had a little more experience of industry than the hon. and gallant Gentleman. There is no reason why it should not be possible to maintain complete independence of the administration and yet not have the power to make appointments. I am sorry that the hon. Member for Mid-Bedford (Mr. Lennox-Boyd), who delved into the niceties of academic hypothesis in regard to the Socialist dilemma, did not deal more effectively with the point which I raised with him in my intervention about Service appointments during the war, or at any other time. We know full well that there was an unsatisfactory system existing prior to the appointment of selection boards where people got commissions to which they were not entitled through a system of log rolling such as that to which the hon. and gallant Member for Ayr Burghs referred.

6.30 p.m.

Air-Commodore Harvey

In which Service?

Mr. Lewis

In the Army. I know of several cases. But in the Army I dispute the hon. and gallant Member's suggestion that any high Army officer was in a position to state who would serve on his staff, with the exception of those exceptional three or four commanders who in special circumstances were allowed to suggest their own appointments. In point of fact, most people were sent up from the bottom and went through selection boards and so on, and it was merit that enabled them to get to the top, if they did so. As to the question of tests, in point of fact the Minister has a system of tests for pilots. All we are asking is that the Minister shall make it possible for an independent body to see which people they should recommend to the corporation as being suitable persons to be employed, with the necessary qualifications. Then it is up to the corporation to make up their minds whether or not they want these persons. We agree that there should be independence of management, but surely it should be in the same way as in the Civil Service. I deprecate the fact that on every conceivable opportunity fun is poked and derogatory references are made to civil servants themselves and to their methods of appointment. The administration may be bad from time to time but that is the ultimate responsibility of Ministers in this House. The members of the Civil Service are a fine body. They go through examinations, and if they are suitable persons, they are employed in a Service on which fewer aspersions can be cast than on any other similar Service that exists in any part of the world.

Mr. Lennox-Boyd

We make no criticism of any kind of the Civil Service. Those of us who have served with them cannot but have the highest regard for them. The only criticism came from the Parliamentary Secretary who suggested that their ranks were increased by an infiltration from industry.

Mr. Ivor Thomas

No, I must intervene. What I said was that human nature is very perverse, that we have had tremendous attacks on the Civil Service that certain changes have been made in recent years, and yet now we are being exhorted to follow the model of the Civil Service.

Mr. Lewis

I hope the Parliamentary Secretary will realise that the object of those who have put down and who support the new Clause is to help him to get a really good Bill, and to ensure that we get that degree of efficiency in our civil aviation which we should have, having regard to the wonderful opportunities this Government now have in their policy of putting national service before what previously was nothing more than a system to retain private privilege.

Mr. Mikardo (Reading)

I would not have intervened but for the references made to criticisms in this House of officers of public corporations. The observations which have come from the Parliamentary Secretary and from hon. Members opposite on this subject, are based upon a misconception, and a confusion between the position of officers of public corporations and the position of civil servants. As we extend the scope of public corporations we are going to be faced, if we are not careful, with a very real dilemma, a real dilemma—not the sort of fictional dilemma which exists in the witty, but rather phantasmagoric interventions of the hon. Member for Mid-Bedford (Mr. Lennox-Boyd), but a very real dilemma. That dilemma is that one may not make criticisms of any public corporation in general terms without being accused in this House of making criticisms without supporting evidence. If, on the other hand, one produces supporting evidence, one is accused, as hon. Members opposite accused the hon. Member for West Middlesbrough (Mr. Cooper), of abusing privilege. One cannot have it both ways. Either hon. Members have a duty to fulfil in drawing attention to what they feel are inadequacies, in which case they must be allowed facilities for so doing, or else public corporations are to be shielded from all criticism, much more shielded than a Government Depaitinent for whom, anyway, there is a Minister to answer.

I point to a personal example. During the Second Reading Debate on the Bill, I was moved to make a very general criticism of the type of persons—the type of persons, not the individuals—who had been appointed to the boards in some cases. I said that some of the members of the boards can be criticised on these grounds, and others can be criticised on other grounds. I mentioned no one by name, and gave no description which could identify any individual. In replying to the Debate, the Parliamentary Secretary said he thought I had made—he said it rather patronisingly and condescendingly —a rather excellent speech, as though he held himself as the last authority on an excellent speech, but that I had spoiled it by general criticisms. If we are not allowed to say, even in general terms, that these people are not of the right type, hon. Members of this House are completely muzzled. I would say to the hon. and gallant Member for Ayr Burghs (Sir T. Moore) that officials of these corporations have an opportunity to reply. We are always told that we must not criticise public servants because the Minister replies for them and it is a tradition that the Civil Service are represented by the Ministers. But everyone has a right to answer, if the Minister does not answer in detail.

Sir T. Moore

How can they speak for themselves, except in the law courts, and the law courts are not able to deal with a statement made in this House?

Mr. Mikardo

Any time I want to dispute a statement made by a gentleman outside, I do not have to go to law; there are still methods by newspaper publicity——

Sir T. Moore

The Government will not give them any paper.

Mr. Mikardo

—and there are other ways of doing it without going to law, as the hon. and gallant Gentleman knows. I am sorry, I did not hear his intervention.

We must be careful about this. We are going to have more and more of these public corporations, and if we accept the view that in the matter of criticism by hon. Members the servant of the public corporation is in the semi-privileged position of the civil servant, and that the Minister cannot be questioned in detail about them, then we are completely and effectively muzzled.

Mr. Harold Macmillan

You have allowed considerable latitude in this discussion, Mr. Speaker, and it has been one of very great interest. Speakers from all sides of the House have tried honestly to face—I will not say the dilemma for that will come afterwards when the Division takes place, but the difficulties which are inherent in a rather new situation. As the hon. Member for Reading (Mr. Mikardo) quite rightly pointed out, public corporation servants are not in a similar position to civil servants. The Minister is not responsible for their detailed conduct and, therefore, they cannot claim the same kind of immunity from criticism as civil servants, in whose case we criticise the Ministers on the Front Bench, the civil servants being merely their instruments. Everything in theory, at any rate, is the action of the responsible Minister. These public corporations are not quite like private companies or bodies with all the rights, and at the same time the responsibilities and difficulties, of private institutions. If I may adapt a well known saying, they are neither as drunk as a lord, nor as sober as a judge, but keep that intermediate position suitable to a Lord Justice of Appeal. In the same way, these are neither private corporations nor wholly nationalised bodies in the sense of Civil Service bodies.

We shall probably have to devise some new system in order to deal reasonably with this matter. For my part I am more anxious to preserve, against the growing domination of these corporations in different forms—these various forms of nationalised undertakings—the rights and privileges of Parliament, through whom alone the public will be able to seek protection, rather than have a too meticulous rule of preserving an individual from criticism. Where there is general criticism, such as the hon. Member made as to the type of people, with no question of individual attack, no imputation of wrongdoing, that criticism should certainly be made. But where a man is accused of a particular act of wrongdoing I do not think we should then use the privilege of this House to prevent what would otherwise become liable to action for slander or libel. There is a difference between the kind of criticism which the hon Gentleman made on Second Reading, which would be perfectly in Order, and criticisms alleging specific acts, almost criminal in character, against individuals which we should not make here, unless we are prepared to substantiate them outside.

It will be necessary, as I say, to develop some kind of method to deal with this comparatively new position. Of course, there have been public corporations in the past, important ones, set up by Conservative and Liberal Governments, but if the range is to grow, the problem will grow in importance. It is for that reason that I look on this new Clause—I was not on the Standing Committee and the Report stage provides an opportunity for those Members who were not on the Committee—with a great deal of sympathy. I was particularly attracted by Subsection (2) of the Clause. I observe that those hon. Members who put it down see the kind of danger which I also have in mind. It reads: In the appointment of officials and the selection of employees for the Corporation and in the promotion of such employees and officials no political test or qualification shall be permitted or given consideration,… That certainly attracts me, and if hon. Gentlemen were proposing to Jake their views to the final test I am bound to say I should, on principle, feel very attracted towards asking my hon. Friends to give them their support. As the hon. Member for Elland (Mr. Cobb) rightly said, in the case of a large corporation, the management, in the sense of the two or three men right at the top, cannot make all the promotions and appointments right through the organisation. They can only do so within a unit which is capable of individual knowledge and control. What they really do is to make the higher appointments themselves, and to institute, as the Parliamentary Secretary told us, some form of board or committee inside the undertaking, which makes the appointments of a minor grade. That is merely a question of size and convenience.

The real question posed by the new Clause is whether this shall be obligatory on the corporation, whether it shall be forced to do this, and whether the proposed board shall be independent in the sense that it shall not be nominated by the directors, but jointly by the Minister and directors. That is the point at issue—whether the corporation shall do that on its own or be forced to do it. I have not followed with sufficient care the whole similar problem in the Bill to know how, up to now, the Committee have resolved that question. As my hon. Friend said in his very able speech, it is a dilemma, in a sense inherent, in the whole relations of Parliament and Minister to this corporation. Are we to go into detail and say, "Do this, that and the other" or are we to leave these things to the corporation for the corporation, in a reasonable kind of way, to make its own rules and regulations as it goes along?

Mr. J. Lewis

This is a question of administration.

6.45 p.m.

Mr. Macmillan

I would say that the most important duty of administration is the appointing of people. I can see no higher function of directors and management than the appointment of people on whom depends whether an undertaking fails or succeeds.

Major Vernon

What we are trying to do is to provide a number of people from whom the final selection should be made —not the final appointment itself, but the preliminary qualification, so that unsuitable people can be eliminated at the start.

Mr. Macmillan

It would be convenient for the corporation to adopt a system like this. The position is whether Parliament should insist on it in this Bill, but do not let the hon. Members think I am unsympathetic. I am trying to meet their point of view. I like it, but in all similar Bills with which I have been connected, the Minister has said, "You must not do this. Do not tie up the new Board, Do not make it do anything. Do not force anything upon it." The Parliamentary Secretary, in his conduct of the Bill, has been very kind to the Committee, and more helpful than has been the case in regard to some other of these great corporations which are being forced upon us. Therefore, I do not go further than that. I have tried to sum up fairly the pros and cons. I have every sympathy with what lies behind this new Clause, which is to see that these things do not become a "racket"—a political or any other racket. Since the test of profit and loss can be far more carefully concealed by subsidy and every kind of method, than is the case in the competitive field of enterprise, my general feeling is that I hope that hon. Gentlemen will divide on this new Clause, and I hope that they will not feel that they have not had from my right hon. and hon. Friends considerable sympathy for their views. We sympathise with their purpose. It may be wiser, in the long run, to write it into the text of the Bill, or wiser to leave more play to the corporation itself. That question, as my right hon. Friend said, is an inherent problem in the setting up of this kind of organisation at all.

The Attorney-General

The right hon. Member for Bromley (Mr. H. Macmillan), in the course of a not short but exceedingly interesting speech, has, I venture to think, failed to give the House any guidance as to which way he would vote in the event of the Division, which he would so like to secure, taking place. It might have been a little help to hon. Members if the right hon. Gentleman, in inviting those on this side to divide on this question, had given them a little advice as to whether they should vote in favour of this new Clause—whether they should support the proposal that independent boards of the kind contemplated by this new Clause should be set up, or whether they should vote against the proposal.

Mr. H. Macmillan

I do not wish to be drawn unduly, but the right hon. and learned Gentleman well knows that had I disclosed my position so early there would have been no chance of this new Clause being divided upon.

The Attorney-General

I am glad the right hon. Gentleman has been frank enough to indicate that. I have no doubt that my hon. Friends on this side of the House will not be led so easily into the trap which the right hon. Gentleman, so pleasantly, so charmingly and so plausibly, is seeking to lay for them. I do not propose to follow the right hon. Gentleman further in the remarks he addressed, not so much to the new Clause before the House, as to his own desire to secure some division in the ranks on this side of the House.

I suggest to my hon. Friends that the dilemma about which the hon. Member for Mid-Bedford (Mr. Lennox-Boyd) spoke is, one of those dilemmas which exist only in that world of dreams and fantasies of his that we had to discuss upstairs on another part of this Bill. So far as hon. Members on this side of the House are concerned, there is no dilemma, no difference of principle, although perhaps there may be some difference as to the method by which the object which we all desire to achieve in this matter is to be attained. We on this side of the House have sufficient experience in the field of private enterprise to know how undesirable it is—yet how common it is—that appointments may be affected by nepotism, by personal influence and by other irrelevant considerations of that kind which ought not to affect appointments in efficient organisations. Consequently, we view with the warmest sympathy any proposal which is intended, as undoubtedly this new Clause is intended, to make sure that in the field of public enterprise the right people are appointed to the right posts. We do not want to see, and we do not intend to see, the less creditable methods of private enterprise translated into the field of public activities.

In general and in principle we on this side of the House find ourselves in agreement with the view that appointments boards are a convenient and appropriate method of making appointments. The method is not infallible; no method can be infallible; but it is a good method. It seems to us that this is essentially a matter of internal management for the corporations—that is not what this proposal does —and that whilst it might be right to create some statutory procedure for the establishment of boards within the corporations themselves, we do not think that it would be right to impose on them from outside a rigid statutory machinery for the selection of their own employees.

Mr. Cooper

The purpose here is clear. For instance, if engineers were required in order to perform certain repair work on aircraft, would it not be right and proper that they should be qualified? In other words, they have to pass tests——

Mr. Speaker

This is the Report stage and these continual interruptions are really out of Order on Report. This is a formal occasion upon which speeches are made. It is not like the Committee stage in which questions are thrown across the Floor of the House.

The Attorney-General

I must not follow up too far the point made by my hon. Friend. Our feeling about the new Clause is that it really falls short of that which its movers seek to achieve, and instead it would impose on the corporations a form of machinery which would be altogether too rigid and which in practice would be quite unworkable. There is no analogy here between the Civil Service Commission procedure and the procedure which is contemplated by this proposed appointments board. The Civil Service Commission is not a completely outside and independent body as the proposed board would be, nor does it deal, as apparently the proposed board would deal, not only with the initial appointments but with every promotion to a new office that took place. I can see that as we come to work out the position of these public corporations, which are becoming an increasing feature of the economic life of this country, it may be desirable to establish certain tests which candidates for appointments in them should satisfy. But we do not think, as at present advised, that it would be possible to say, consistently with the proper and independent management of the corporations that are being set up, that every person, not only when he enters the corporation but when he is promoted from post to post, should have to bear the recommendation of an outside body which apparently would contain no representatives of the corporations. That course would really provide too easy an excuse to the corporations if anything went wrong.

They could turn round and say, "Well, it is perfectly true we have made a mistake here, It is perfectly true something has gone wrong, but how could we do otherwise when we were not allowed a completely unfettered choice in the promotions we made and when we were limited in our promotions to persons who had received the approval and recommendation of an outside board, which could not possibly have the same knowledge of the working of our Corporation, or of the actual work which had been done by those particular candidates for appointment, as we possessed ourselves?" Where the body concerned is a private enterprise, a joint stock company, the result of bad appointments eventually may be failure. One more bankruptcy is added to the long list of failures which have distinguished We "London Gazette" for many years. Perhaps nobody worries very much about it. On the other hand, where die organisation concerned is one of these new public corporations, the position is very different. The board are responsible to the Minister, the Minister is responsible to the House, and one has the ever-vigilant Member of the House available and ready to see that proper appointments are made and, if they are not made, the fact of their impropriety is brought to the notice of the public.

Subject to that, the existing corporations which have already set up internal appointments boards themselves will no doubt have taken careful note of the views that were expressed sincerely and properly from this side of the House in regard to the desirability of the establishment of boards of this kind. We for our part shall give further consideration to the general position of appointments in connection with public corporations not so as to impose upon them an outside body which would be responsible for appointments and promotions within the service, but in order that we may consider whether there is any means at once of assuring and protecting the independence of the corporations and, at the same time, securing that those who were available for appointment within them were persons possessing proper qualifications. We do not think that this Clause would achieve either of those results, and in view of what I have said we hope hon. Members will not press the matter to a Division.

7.0 p.m.

Mr. C. Williams

Those of us who have listened to most of the Debate resent the attack made on the Parliamentary Secretary by the hon. Member for Reading (Mr. Mikardo). He accused the Parliamentary Secretary of being complacent. I could say quite a lot about this Parliamentary Secretary if I wished, but I would never say that. It was an unkind attack on the hon. Gentleman, who, I feel, was doing his best. It may be that the attack was made because the Parliamentary Secretary did not happen to be wearing a red tie today, or something of that sort. The fact remains that it was a very unfair attack, and I wish the Leader of the House had been present to hear what some of us think of these back bench attacks by hon. Gentlemen opposite on their own Front Bench.

We have had a most interesting Debate, which has shown quite clearly that both sides of the House realise that, when we appoint these boards, we must have two things. We must endeavour to keep the independence of the members of the boards, and we must also endeavour to see that we get the best men on the boards. We are all in complete agreement on that matter. There is a further point on which I do not think right hon. Gentle- men on the Front Bench opposite need pat themselves quite so much on the back. That is that both sides of the House—if I wanted to take it further, I could go into it very easily—want to see absolute honesty and probity in public work and in general Government work all round. We are all agreed on that. We have had those points brought out in a Debate which has lasted some time, and in which we have had the views of a considerable number of hon. Members, a variety of views, including some from hon. Members of great experience. Having had all that, we then came to the point at which it was quite obvious from the last speech that the Government, at the minute, have no consistent policy in setting up this kind of board. They do not happen to like this new Clause. It is a pity that some of the speeches could not have been heard by the Leader of the House, because if he had heard them, he could have gone back to the Cabinet and told them that——

Mr. Speaker

That has nothing to do with the Motion before the House.

Mr. Williams

I absolutely accept your Ruling, Mr. Speaker, and will just say that this is an extremely interesting Clause, which has produced an extremely interesting Debate, and that I very much regret that the great value of this Debate could not be used to some purpose, or that the Government could not, instead of making vague and indecisive speeches, tell us what kind of a board they are going to set up for the future.

Mr. Beverley Baxter (Wood Green)

I rise just to say that, when a board of management has been appointed, especially if it has the difficulty of dealing with a Minister, which is an extra disturbance to its wisdom and judgment, it would be too much to impose another independent board on it. For the first time in this Parliament, I agree entirely with the learned Attorney-General. May I, therefore, appeal to those who support this Motion not to force it, and thus save the Government from a crisis?

Major Vernon

Uninfluenced by the remarks of the hon. Gentleman opposite, I beg to ask leave to withdraw the Motion.

Motion and Clause, by leave, withdrawn.