HC Deb 29 April 1947 vol 436 cc1742-63

  1. (1) Where, under Part II of this Act or under any scheme made under Part IV of this Act, any undertaking to which this section applies 1743 is transferred from a local authority to the Commission or to a body constituted or specified under such a scheme, the Commission or that body, as the Case may be, shall pay to the authority whose undertaking is transferred the appropriate sum as compensation under this Section.
  2. (2) The undertakings to which this Section applies are—
    1. (a) any undertaking of a local authority which falls to be transferred under Part II of this Act;
    2. (b) any undertaking which, at the passing of this Act, is being carried on by a local authority, being an undertaking which could be transferred to the Commission or to some other body as aforesaid under a scheme under Part IV of this Act;
  3. and the expression "the appropriate sum" means, in relation to any undertaking to which this Section applies, such sum as may be specified in relation to that undertaking by regulations made by the Minister, so, however, that the total of all the appropriate sums for undertakings the activities whereof consist wholly or partly of operating passenger road transport services does not exceed two and a half million pounds and the total of all the appropriate sums for other undertakings does not exceed two hundred thousand pounds.
  4. (3) This Section shall apply in relation to a transfer of a part of an undertaking to which this Section applies as it applies in relation to the whole of that undertaking except that the sum payable by way of compensation under this Section shall be such part of the appropriate sum as may be determined by the Minister; and the total of the sums so determined by the Minister in relation to parts of an undertaking shall not exceed the appropriate sum for the whole of that undertaking.
  5. (4) The compensation payable under this Section shall be payable in cash and shall be in addition to any compensation payable under any provision of this Act, or under any other provision of this Act as applied by a scheme; and the references in Part IV of this Act to provisions of this Act relating to compensation shall be deemed not to include references to this Section.
  6. (5) In this Section, the expression "local authority" includes the council of a county district.—[Mr. Barnes.]

Brought up, and read the First time.

Mr. Barnes

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

When I moved an Amendment to Clause 25 yesterday I explained the purpose of this new Clause. As a result of representations made by local authorities both with regard to the Electricity Bill and the Transport Bill, the Government had come to a decision to set aside sums under both Measures for the purpose of meeting any loss which local authorities might incur as a result of the severance of these trading undertakings from their general local authority expenses and over- heads. The figure that has been settled as a result of the discussion between my Department and the representatives of the local authorities amounts in this case to a sum of £2,500,000. As I indicated before, it is anticipated that a sum of approximately £200,000 will cover any similar liabilities that might arise under the port scheme.

I always like to be accurate in the information which I give to the Committee, and when I was moving that Amendment I said this had been negotiated. I think it was the right hon. Gentleman the Member for the City of London (Mr. Assheton) who pressed me on that point. I do not know whether there is any difference, but I should like to make it clear at this stage that expert representatives of the local authorities discussed this with the officers of my Department, and it is anticipated that this sum will, roughly, cover the liability which we intend to meet. But there has not been time to have it fully considered by the local authorities as such. Those in discussion with my Department, however, agree that this sum would probably do what was my intention in this case. I have also discovered that the Scottish authorities have not been included in these consultations. Nevertheless I have no reason to believe that this sum will not be adequate for this purpose. I commend it to the Committee with that slight correction of the statement which I made, when I moved the previous Amendment.

Mr. Assheton (City of London)

I am obliged to the Minister for what he has told us. I hope he will forgive me for having pressed him, perhaps he thought rather mercilessly, on this matter last night. I think the answer which he has given this afternoon to some extent justifies me in the action which I took. I certainly did not intend to suggest that the Minister was misrepresenting. I never thought of that for one moment. I wanted the Committee to know whether or not the local authorities were satisfied. We are often told about consultations and negotiations, and so on. One rather wants to know whether as a result of these consultations and negotiations, an arrangement has been arrived at which is satisfactory to both parties or whether it is merely a case of the local authorities having had to listen to the Minister's decision and accept it with the best grace which they could muster. As far as I can gather, in the first place, the Minister only proposed to go a part of the way. What he is trying to negotiate with the local authorities is whether or not the sum of £2,500,000 meets that part of the way which he intends to go. I notice in HANSARD that what the Minister said in opening this matter yesterday was: For the time being, it is proposed that should set aside a sum of £2,500,000."— [OFFICIAL REPORT, 28th April, 1947; Vol. 436, c. 1635.] I am not quite certain what is implied by the words "for the time being."

Mr. Barnes

Until the area schemes are ready.

Mr. Assheton

In that case, it appears that £2,500,000 is the sum fixed by the Government for this purpose, and that it is not open to discussion. Now, it remains for the Minister and his officials to negotiate with the local authorities and to try to persuade them to fit their schemes into the £2,500,000 which is available. Of course, I cannot prophesy how that will work out. I have seen something of these global sums in the past. It does not always work out that everybody gets what he thinks is a fair deal. We are grateful to the Minister for having made a move in the right direction, although I do not for one moment suggest that it will satisfy the local authorities. We do not intend to oppose this new Clause.

Mr. Hoy (Leith)

I wish to put a question to the Minister arising from what he said yesterday about having had negotiations with the proper accredited representatives of the local authorities. Since then I have had an opinion from Scotland which verifies the statement that Scottish local authorities were not consulted. We expect that the sum will be such as will cover the needs of - the Scottish local authorities concerned, whether or not the Minister has to go back to the Treasury, in order to increase the global sum. I suggest that when the regulations are made, the Minister should consult with the Scottish local authorities, and I should like a specific assurance upon that point.

4.15 p.m.

Mr. Wilkins (Bristol, South)

The Minister has said that he realised that local authorities had not had a lot of time in which to consider the new Clause. Unfortunately, I have not had much time in which to contact my local authority and get their reactions. The Minister may remember that on Second Reading I was rather interested to know how the Bill would affect municipal docks. This is not a case which is quite comparable with or analogous to those of gas or electricity. As I tried to make plain on Second Reading, a rate-in-aid may have had to be given to a dock undertaking over a long number of years. It is the opinion of the Port of Bristol Authority that the sum which the Minister has provided—£200,000 from the global sum—is totally inadequate and certainly will not satisfy these demands. We think that it is not sufficient to meet even the commitments of the Minister in regard to our undertaking under his proposal.

Under Section 21 of the Finance (No. 2) Act, 1945, local authorities are allowed to aggregate all their interest payments and other annual charges, and to treat them as payable out of taxed receipts in so far as the profits of their trading undertakings will allow. The amount available to the city of Bristol under this provision, expressed in terms of tax, have averaged £173,507 over the past nine years. This is equal to a rate of 1s. 0½d. in the£ on the rateable value of the city. From the point of view of the ratepayers it is a serious matter. Should the Bristol docks be brought under the control of the Commission, then this relief would disappear automatically, with a consequent adverse effect upon the ratepayers of the city. The Port of Bristol Authority consider that it is of prime importance that this benefit to the city should be preserved in the financial arrangements which are to be included in this Bill. At present, there is no Clause which would allow compensation to be paid in respect of Income Tax losses arising if nationalisation is extended, as we believe it will be extended, to the Bristol dock undertaking.

The Minister mentioned the effect of severance. If severance takes place, we presume that the city would continue to manage the stocks relating to capital of the dock undertaking and would be entitled to some reimbursement in connection with the administrative expenses in which they would be involved. The dock share in this connection is, approximately, £3,000 per annum, but we think that this would be increased by reason of the Budget provision which provides for the doubling of Stamp Duties on transfers and so on. Therefore, we think that it is proper that the city would continue to incur overhead charges relating to these stocks for perhaps another 50 years after severance. Consequently, the major part of the £200,000 would be required by Bristol alone under this one heading relating to stock management expenses. There are other continuing overheads with which I will not trouble the Committee. We ask the Minister, if it is not too late, to reconsider the provision which he is making in this Clause. We suggest that £200,000 dispersed among all the municipal dock undertakings will be totally inadequate to meet the claims which these various authorities would have a right to submit to the Minister.

Mr. W. J. Brown (Rugby)

If I had been present yesterday, I should have desired to attack the compensation provisions of this Bill as a whole. All that I can do today is to attack the compensation provisions in this new Clause put forward by the Government for the category of undertaking to which reference is made. That is defined in the Clause as "an appropriate sum." The Clause says: The expression 'the appropriate sum' means, in relation to any undertaking to which this Section applies, such sum as may be specified in relation to that undertaking by Regulations made by the Minister. Later on, there is an overall restriction as to the total sum which may be paid out in compensation to all the undertakings taken together. That is a brief summary of the contents of this Clause. I wish to attack that Clause, and I wish to attack it because it corresponds with no principle whatever that any reputable Government in the past would have applied in dealing with a matter of this kind.

I have served in the public service for a very long period of time, and in my day in the public service there were three principles which governed this kind of thing. The first principle—it is staggering to relate it now—was that there should be a principle; that is to say, that decisions should not be taken arbitrarily on each case as it arose, but that every decision, although the amounts would differ, must be related to a firm principle which applied throughout the whole area with which the State was concerned. Principle No. 2 was that whenever the State took over, whether from a municipal authority or a private citizen, property by requisition or nationalisation or any other legal means, the obligation laid upon the State was to pay a fair price for that property. The validity of that principle does not require much argument. All sorts of people put their money into different concerns, and it would be a monstrous injustice to a category of people who happened to have put their money into one type of concern if that concern were treated differently from any other. That would be an injustice as between one type of citizen and another. Therefore, the principle was laid down, for universal application—a fair price for what was taken over. Principle No. 3 was that in the event of a dispute arising between the citizen or the municipal authority on the one side, and the State on the other, as to what constituted a fair price, neither the citizen nor the State should be judge and jury in its own cause, but that it should be determined by reference to an independent authority set up under the appropriate Statute.

In recent years these elementary principles, which 40 years ago nobody in the public service would ever have dreamt of questioning for a moment, have become a little battered. For example, in the Compensation (Defence) Act, 1939, the State took power to take over the citizen's goods and chattels at 1939 prices, and although the cost of chattels went up and up all through the war, the State continued to requisition the citizens' chattels at 1939 prices, with the result that when the war was over many citizens had to replace their chattels at prices, in the case of furniture, anything up to three and four times the amount of money which the State had paid them for the furniture it took. That was a very grave breach of those elementary principles. I speak from recollection but I think that was a Coalition Measure, and therefore I do not attack either side of the House as being exclusively responsible for it, but it was a great departure from those elementary principles.

With every step we have taken since, we have got further and further away from the elementary ground of those principles. For example, when we nationalised coal we fixed a global sum, the amount of which is to be determined by an independent Commission. In that case, we reserve Principle No. 3, even if we do not reserve Principle No. 2. When we come to deal with the transport industry we break all three principles. We do not relate what we do to any preceding principle. We do not give a fair price but an arbitrary price, and we reject exclusively any right whatever for the aggrieved party, if there are aggrieved parties, to go to an independent tribunal to determine what is or what is not a fair figure.

In the course of my lifetime, I have noticed that Governments which are allowed to get away with arbitrary things become more arbitrary as time goes on. Arbitrariness is a thing that grows with the practice thereof. I say that this Bill as a whole, and this Clause in particular, correspond to no principle whatever which the State in the past has recognised as being applicable to the taking over of undertakings. Where will these concerns be under the Clause? The Clause which the Minister of Transport has moved provides that

… the Commission … shall pay to the authority whose undertaking is transferred the appropriate sum as compensation under this section. The Clause goes on: … the expression 'the appropriate sum' means, in relation to any undertaking to which this section applies, such sum as may he specified … by regulation made by the Minister. … Later, the Clause says that whatever regulations the Minister makes, the total amount of money he pays out shall not exceed a certain overall figure. I characterise the Clause as monstrous. I characterise it as corresponding to no reputable principle whatever. We should determine what we are to pay for a thing before we take it. The Government have no right to take other people's property at their will and pleasure, and then to tell them that later on they will be told what they are to get for it. That is not government; that is robbery. Here no undertaking knows what it is going to have, and even when it gets the regulations later to be issued by the Minister, and gets some sort of idea as to what it might get, it does not know whether it will then run up against the inhibiting barrier of the overall global sum which is to be laid down under this Clause. I regard this not as government but as a dereliction of government. I cannot imagine any preceding Government sitting on that bench, whatever its complexion—unless it was a Coalition which is the combination of the worst elements of all parties—proposing such a Clause as this or such a Measure as the Compensation (Defence) Act, 1939.

Mr. Douglas Jay (Battersea, North)

Would the hon. Gentleman agree that the worst elements among the Independents were also included?

Mr. Brown

At any rate I am not subject to any charges in that connection because, by definition, I have forfeited any claim to that invidious, laborious, closely-watched slavery, which is mocked by the name of power!

Mr. H. D. Hughes (Wolverhampton, West)

Would the hon. Gentleman not agree that, by definition, he is a Coalition in himself?

Mr. Brown

If I am a Coalition in myself, it manifests a solidarity which has been absent in its predecessors. I describe this Clause as literally an unprincipled Clause, and I do not think that the Government ought to be allowed to get away with it, nor with the other compensation provisions here. The first maxim of government—and, I say this with great earnestness, and it should above all be true of a Labour Government—is that one must not do an injustice to one citizen by comparison with another similarly situated. That is a maxim that should underlie all government, and it is utterly violated by the Clause the Minister has moved this afternoon. I hope very much that we shall divide on this, and I announce my firm intention of going into the Lobby against it and any similar provisions.

Mr. Harrison (Nottingham, East)

Is the hon. Gentleman aware that this Clause deals with compensation only?

Mr. Brown

That is immaterial to the argument I have made. If anything is done which alters the situation and financial position of the existing owners of the undertaking by transferring it to a Commission, or some other body referred to here, the Government should compensate on the principles I have laid down. This Clause utterly fails to do so and therefore ought to be rejected by any House of Commons which is concerned that government should correspond with some kind of elementary principles.

4. 30 p.m.

Mr. Thomas Lewis (Southampton)

I think the local authorities will be grateful to the Minister for making this concession, but I gather that they would like further time to consider the matter of the global sum. I wonder whether, between now and the next stage of the Bill, the Minister will have consultations with the Association of Municipal Corporations and the County Councils Association to enable them to judge fairly on whether this amount of £2,500,000 is rational in the circumstances. I do not think it is worth while antagonising the local authorities for the sake of £1 million or more, in view of what is involved. The local authorities are in favour of the scheme as outlined, and I would impress upon the Minister the necessity of keeping an open mind on the matter and of coming to some definite arrangement on the right amount necessary to achieve the desired result. The local authorities, as under the Electricity Bill, are very interested

Mr. Orr-Ewing (Weston-super-Mare)

May I return to the rather special case of Bristol? The hon. Member for South Bristol (Mr. Wilkins) outlined the general estimated effects of this Clause on the citizens of Bristol. If it were a matter of a private individual or a private undertaking, or even of a public company being treated in this manner, it would be serious enough, but I ask the right hon. Gentleman to consider one remark in particular, made by my hon. Friend, as to the effect on the rates. Many of my friends and constituents rely for their livelihood on the activity of business in Bristol and I cannot believe that the Minister, when considering the sum of 200,000, realised that by limiting it to that figure he makes it impossible for this particular authority to get fair compensation. I am sure he had not in mind that the limit would prove a brake or deterrent or discouragement to the industry of a great city. I ask him seriously to reconsider this matter. He said that consultations had taken place. May I ask him now whether any direct consultation took place with the authorities in Bristol? After all, they are more seriously affected by the proposals in this Clause than any other authority is likely to be. I shall be only too pleased to give way, if he will give me an answer.

Mr. Barnes


Mr. Orr-Ewing

In that case, I think my argument is strengthened. Quite clearly the position of this authority, with all their activities, destroys the general picture set out by the Minister in putting forward this Clause. As evidence has been produced that it will have an unforeseen effect on this authority, he would be fully justified in reconsidering the matter, to see whether the global sum could not be increased, or some other arrangement made to meet special cases, which are bound to arise, and of which I think the most extreme example will prove to be that of Bristol.

Mr. Champion (Derby, Southern)

The point I want to put is a simple one and relates to the appropriate sum to be specified by regulation. I do not want to ask a question about the overall amount, but I would ask whether provision will be made in the Regulations for the method of payment. It has been put to me that an advantage would accrue to local authorities if payment of the sums due under this severance was made in such a way as to be a diminishing sum over a number of years. This would enable the local authorities to make their rate provisions so as gradually to absorb the overhead expenses and the salaries of the officers affected by the severance. This is of some importance to local authorities, and I hope the Minister will consider it, because if a round sum is to be paid to a local authority straight away, the effect on the rates would be immediate. The better way would be to pay a diminishing sum each year, until the local authority has had time to adjust its rate position.

Mr. McKie (Galloway)

As I listened to the Minister moving the new Clause I thought this might be one of the few occasions during the passage of this Bill, when I could have congratulated the right hon. Gentleman on the spirit of sweet reasonableness which he seemed inclined to show. Of course I made one important mental reservation on a point about which I will say something in a minute or two. However, as I listened to the speech of the hon. Member for Rugby (Mr. W. J. Brown) I felt that any congratulations which I might have been inclined to bestow on the Minister would have been out of place, because the hon. Gentleman showed conclusively that this new Clause is founded upon what he considered a very erroneous principle—or rather, on no principle at all. He maintained, and I agree, that any question of the assessment of compensation should be taken before an independent tribunal. In passing I would say that I wish the hon. Member for Rugby had been here yesterday, when we were putting the case of the shareholders, because I am sure the speech he would have delivered then would have been an admirable one.

As I said, I had one reservation with regard to the congratulations that I might have bestowed on the Minister before listening to the speech of the hon. Member for Rugby. The Minister informed us that no consultations with the Scottish local authorities had taken place. I was glad to hear the hon. Member for Leith (Mr. Hoy) chiding his own Minister on this point in as strong language as one would expect from so loyal, faithful, almost subservient a Member on the Government side. I should have thought that on an important occasion like this— important to Scotland—we might have been favoured with the presence on the Treasury Bench of the Secretary of State for Scotland or one of the Joint UnderSecretaries. I noticed the Parliamentary Secretary to the Ministry of Food sitting at the far end of the Bench. Of course, she is the only Minister outside the immediate circle of the Scottish Office who has any say at all in the affairs of Scotland, and I thought perhaps her presence there betokened the fact that she was ready to intervene if necessary and tell us why these consultations have not taken place up to the present, and when they will take place. I am still hoping the Minister will say something about that.

The question of the inadequacy of the global sum has been raised not only by Members on the Opposition side, but considerable concern has been shown by Members on both sides. In one sense it is as well that no consultations have yet taken place between the Minister and the representatives of the local authorities of Scotland. Just what proportion of the inadequate global sum of £2,500,000 in respect of local authorities operating passenger road transport services, is it proposed to pay to local authorities in Scotland operating road transport services? Is it to be on the old allocation, or is the right hon. Gentleman to have regard to the fact that road transport in Scotland bulks far larger than in England, because we have fewer railways, and people have to travel by road to a much greater extent? Is he to make a more generous allocation than has been the case in the past? The hon. Member for South Bristol (Mr. Wilkins) asked what conversations have taken place between the Minister and that great seaport—very great in the 18th century, but not so great today. The answer was, as in the case of Scotland, none. In the words of my hon. Friend the Member for Evesham (Mr. De la Bère), I think that is "thoroughly unsatisfactory." The port and the harbour facilities in Scotland are of very grave concern to the people of Scotland, and the Minister ought to realise that, having regard to the very large part played by Scottish people in seafaring enterprise. I hope that in the case of the 200,000 compensation the Minister will let the local authorities in Scotland know, what proportion they are to have, arid what proportion of the larger sum—if the Minister softens his heart—he is prepared to give to Scotland.

Mr. Alpass (Thornbury)

I have received representations from the city council of Bristol, and from committees of that body, asking me to make a further appeal to the Minister to reconsider this important matter. I am practically in the same position as the hon. Member for Weston-super-Mare (Mr. Orr-Ewing). Although I do not, in this Parliament, represent any constituency of the still great city of Bristol—

Mr. McKie

Not so great as it was in the 18th century.

Mr. Alpass

I am sorry that any Scottish hon. Member should attempt to disparage my great city. We claim it is as great today, and greater than at many times in past history, especially as it has a Labour majority on the city council. Although I do not represent, in this Parliament, any constituency of the city of Bristol, a large number of my constituents get their living in that city, and have to use its transport services. Their interests are to a large extent bound up with those of the people who live within the city boundaries, and what affects those who live within the boundaries reacts on my constituents. I wish to reinforce the appeal made to the Minister. We do not want to be ungrateful to the Minister, because he has to some extent reconsidered this matter, but we hope that before he comes to a final decision, he will have consultations with the representatives of this city, and. cities similarly placed. The compensation has been considered inadequate and, perhaps, in some cases unjust, but I do not like to use that word, because the Minister throughout the Bill has shown that he is possessed of a spirit of fairness. [HON. MEMBERS: "No."] Hon. Members do not agree with that, because they want something that is more than fair. Because I have confidence in him I want the Minister to say that he will reconsider this matter.

4.45 p.m.

Mr. Maclay

There is a point of detail which I would like the right hon. Gentleman to consider. Subsection (2) of the new Clause provides for the payment of the appropriate sum according to regulations made by the Minister. Clause 64 which provides for matters which might be put down as part of a scheme also provide for the incorporation of compensation provisions. What I want made clear is whether additional compensation under this new Clause will appear when the original scheme is published. As it stands, when a scheme is prepared in connection with a port or group of ports, I do not see how the extra provision can come in. How are the people affected to know what they are to get? It would be helpful to know how the new Clause and regulations link up with the preparations of a scheme under Clause 64. Many hon. Members have asked whether the sums are adequate and as the hon. Member for South Bristol (Mr. Wilkins) has said Bristol could swallow the whole lot. The Committee may be interested to know that there are no less than 70 ports and harbours owned by corporations, county urban or rural district councils and if all were affected by the Bill, they would get an average of £2,857 2s. 7½d. each out of this sum. I do not think that would be satisfactory for all of them; whether Aberystwyth or Perth would be satisfied, I do not know. I am encouraged in some ways, by the fact that this figure has been put low because I hope it means that wisdom has been descending on the Minister's head and that he realises the extreme undesirability of including most ports under any scheme. It may mean that he does not mean to interfere with more than one or two ports in the country. It may mean one or two which, for strategic reasons, it is necessary to take over. If that is the explanation, I should be glad to agree.

Mr. C. Williams

The hon. Member for Rugby (Mr. W. J. Brown) did a service to the Committee in raising two points in connection with this Clause. He referred to what is happening far too often—a global sum is being indicated, but that it may not be the sum required. In the second place, he pointed out that what is happening, is that with that sense of unfairness which permeates the mind of every Minister in the Government, they dare not go to arbitration in these matters. They arbitrate themselves. Three or four Members of the Socialist Party have made speeches considerably longer than the speech which I shall make on this matter. I had hoped from the Minister's speech and from my reading of the Clause that the Minister was going to meet the position. I had hoped for that still more because, after following fairly closely the Debates yesterday and today, I believe that the Minister does not really mean to interfere very largely with these local authorities; but from the speeches we have heard with regard to Scotland and Bristol, it seems that there are still grave apprehensions in the minds of the local authorities as to what will happen. Bristol has had to seek outside protection today because the right hon. and learned Gentleman the President of the Board of Trade, who should be here to defend his constituency, rarely attends the House except to give orders. [Interruption.] Surely, I am within my rights in asking for information as to what the Members representing Bristol think on this occasion, because this matter is likely to affect Bristol to the tune of a very large sum. I wonder why the right hon. and learned Gentleman the President of the Board of Trade, who is the Member for East Bristol, does not take an interest in Bristol?

Mr. Alpass

Why does not the hon. Gentleman make the same comments on the absence of the right hon. Gentleman the Member for West Bristol (Mr. Stanley)?

Mr. Williams

I had not finished my speech. My right hon. Friend the Member for West Bristol (Mr. Stanley) is a very hardworked person. When he intervenes in Debates; he does not do so in the interests of hon. Members opposite, and they get very cross with him. I thought the Minister was going to help us more on this matter. I would like to see the two global sums considerably extended, and I hope that in another place it will be arranged that the power to make regulations will not rest with the Minister, but with an outside, impartial body. I know that the Minister is trying to meet the local authorities on his matter. I do not know how I shall vote if there is a Division. [Interruption.] I know that hon. Members opposite hear the crack of the whip and go into the Division Lobby as they are told. I hope the Minister will promise to go further into this question with the local authorities so that when the Bill goes to another place an assurance can be given that he has gone into the matter more' fully with the local authorities.

Mr. Barnes

I am afraid this Debate has widened beyond the purpose of the new Clause. In reply to my hon. Friend the Member for Leith (Mr. Hoy), the Scottish authorities will be considered. The time available since the Committee stage, and the necessity to get this provision into the Bill, has probably prevented discussion to the extent that would normally have been undertaken. I do not think it would be possible at this stage to have individual consultations with local authorities; it would be quite impracticable to consider the great variety of circumstances that prevail with regard to each municipal transport or dock undertaking. The real difficulty in the whole problem has been the variety in the practices that have prevailed among different local authorities on such matters.

Mr. C. Williams indicated dissent.

Mr. Barnes

It is no good the hon. Member shaking his head. It is a fact.

Mr. Williams

The right hon. Gentleman has promised to go into the question.

Mr. Barnes

Any point that is raised can be looked into, but that is different from having individual consultations with every local authority. The Government discussed with the accredited representatives of the local authorities many of the points that have been raised today, and decided that it was quite impossible for them to meet points such as that raised by my hon. Friend the Member for South Bristol (Mr. Wilkins), namely, the compensation of local authorities for their Income Tax setoff, or compensation for any local authorities that have taken sums from their trading operations for the benefit of the rates. It has been impossible to get any basis of agreement on a variety of circumstances of that character. It was in consideration of all those matters that, eventually, the Government agreed to try to meet the problem of the increased overhead charges which local authorities would have to meet for the purpose of adjusting their municipal accounts. The hon. Member for South Derby (Mr. Champion) asked whether such compensation could be paid on a diminishing payment principle. That is a matter that can be looked into and discussed later.

In the remarks which the hon. Member for Rugby (Mr. W. Brown) made, he was not quite seized of the whole of the problem. I would refer him to the fact that in Clause 25 the main principle of compensation for local authorities is met, and the appropriate sums referred to in the new Clause have nothing to do with the method adopted in the Bill of compensating local authorities for the transfer of municipal undertakings to State undertakings. In Clause 25 the whole of the interest and debt charges of the local authorities on any undertaking are fully met, and we are here dealing with the transfer of an undertaking from one public body to another public body. The citizens of our great local authorities are not losing possession of the property that is being transferred; that property is being merged with other transferred property, and the total public property that will be held by any group of citizens in Bristol, Glasgow, Birmingham, or elsewhere, will be considerably enlarged. It is true that the ownership of their property will be spread over the whole community, but the principle of public ownership is retained in this Bill. Therefore, it appears to me, that many of the remarks made by the hon Member were beside the point.

5.0 p.m.

Mr. W. J. Brown

In principle, it does not matter two hoots whether the transfer is that of a bit of property from a private individual to the State or from a municipal authority to the State. I wish we got more into the habit of arguing in terms of principle. I can conceive of a case where a local authority has an under taking—

Mr. Barnes

I thought this was to be an intervention on the part of the hon Member, and not a speech

Mr. Brown

I do not want to be unreasonable, and I shall be as brief in my intervention as I can. The undertaking to which I was referring is making good profits in relief of rates. We propose to take it over, and we shall have the right to take it over. I assert that we should compensate upon some basis of principle. If there is a dispute as to what the right compensation should be, we ought not to be judge and jury in our own case.

Mr. Barnes

The hon. Member overlooks the fact that there is another principle involved in the illustration which he gave. If the local authority used any surplus derived from the trading of the whole of the citizens, in order to relieve rates for a specific section of the citizens, they would perhaps be making a breach in another principle. I do not think that the illustration in that respect can he carried very far. I was pointing out to the hon. Member something which I thought it was necessary for him to understand so that he might avoid making similar statements in public in future. Interest and debt charges are being taken over by the Bill The principle of public property is in no way interfered with.

What we are discussing on the proposed new Clause, are representations made to me by a number of Members on both sides of the Committee on behalf of their various local authorities. I am dealing with a legitimate and practical point here. Those hon. Members pointed out that part of the overhead liabilities in their localities, such as those in respect of municipal buildings, are often charged to the trading undertakings. Sometimes the salaries of municipal officers are so charged. In meeting their interest and debt charges I am not, and the Government are not, dealing with the residual expense which the local authorities will have to meet in those directions. The Government undertook to consider those representations, and the proposed new Clause is designed to meet that specific point.

I do not attempt to deny that this proposal will not be a solution satisfactory to the local authorities. They will want to raise many other points. I am not meeting those points. The Government so far, cannot meet those points, and therefore in our discussion this afternoon, we must limit ourselves to the extent to which the Government, at the moment, are prepared to go. This sum of £2,500,000 has bee arrived at on the basis of five or six years' purchase of one per cent. of the gross receipts of the local authorities' passenger transport undertakings. The sum c £200,000 is for municipal dock compensation. It does not cover all the dock concerned but only municipal docks. The sum has been arrived at on a similar principle. It is considered that it will b sufficient to taper off, and to enable the local authorities to make the necessary adjustments in this direction.

My hon. Friend the Member to Southampton (Mr. T. Lewis), while wet corning the decision, said that local authorities were not able to judge whether the compensation would be adequate am fair. I would remind hon. Members that all we are doing at this stage is to settle a global sum with regard to municipal road passenger services. Municipal docks and harbours cannot be dealt with at the present moment in detail, because they are subject to area schemes under which provision is fully made, particularly for local authorities, for the fullest opportunity of consultation with the Commission as to the volume, method and adjustment of matters of this description.

Mr. T. Lewis

The point is whether the £2,500,000 is sufficient. Before the amount is finally fixed, would not my right hon. Friend consult the associations representing local authorities?

Mr. Barnes

I have already pointed out that officers representing municipal corporations have had discussions with my Department and were responsible for coming to this figure with my Depart- mental officers. I agree that there was not time to refer the matter back to the association as such, for them to come to a definite decision, but I have no reason to think at this stage that they will not accept the figure as a fair basis.

Mr. Orr-Ewing

The right hon. Gentleman has just said that it was impossible for him to fix in detail what sums were to be paid, because the schemes were not yet available. Surely that is an argument for revising the proposed sum when the schemes are available. It appears to me that the Minister, this House and the local authorities are being left in the air They do not know what the schemes are to be The figure in the Bill therefore just makes nonsense.

Mr. Barnes

I do not accept that argument at all. It appeared to me when this matter was submitted to me for my approval that the sum ought to be adequate to meet the liability.

Mr. Orr-Ewing

We do not know what the liability will be.

Mr. Barnes

We do not know what the liability will be for each particular undertaking, but we know the gross receipts of the aggregated transport undertakings. We arrived at that sum on the basis of the overall aggregate receipts, and that appears to me to be a fair basis of measurement in a case like this. I do not see any other method or process by which to come to an aggregate sum, that is, if we want to get to grips with the problem and not leave it over indefinately, ultimately for the arbitrament of the Minister. This is an attempt to fix an assured sum in the Bill. If there is still undue anxiety on the part of hon. Members I will undertake to look at the matter again between now and the consideration of the Bill in another place. If we are to make progress in matters of this character, it is essential that we should get a decision in the Bill at least. Its modification is all that I can promise to consider in subsequent stages. If that promise is satisfactory to hon. Members, I hope that the Committee will now give me the Clause.

Mr. Wilkins

May I thank my right hon. Friend for coming to a decision on the point? I would ask that between now and the Third Reading he should consider the point put to him by the hon. Member for Weston-super-Mare (Mr. OrrEwing). Would my right hon. Friend be prepared to meet a deputation on the subject from interested parties? He said he had had a deputation representing local authorities intimately concerned in the matter. Would he receive a deputation from some other representative bodies?

Mr. Barnes

I cannot agree to meet representatives of any particular groups of local authorities. I think that would add to my difficulties. I have already met the representatives of the Municipal Authorities' Association, and many weeks ago we had discussions in which the whole of these problems which have been raised in the Committee were adequately considered. Subsequently the same body of persons met the Ministers who are con- cerned with other matters, and it was arising out of those consultations that eventually the Government decision was made on the question of some compensation for overhead and severance. There was adequate consultation between the Government and the proper municipal representatives in coming to this decision, but in the framing of the Clause and the fixing of the global sum there was not sufficient time, between the Committee stage and the submission of this Clause, for the decision to be referred back and the actual sums to be approved by the authorities. There will not be time between now and Third Reading to undertake such consultations, but before this Clause is reached in another place I will undertake to have another look at the problem and consider more fully the views that have been expressed on all sides.

Mr. Maclay

Could the Minister make it clear that, when a scheme is made public and an opportunity is given for protests, the allocation of money under this Clause will appear in the scheme? That is the point I was trying to make. This is a regulation-making matter and the other is a scheme-making matter. It may be an obvious point, but it is essential that we should know the total sum an authority might receive under a scheme so that the various interests could be taken into account.

Mr. Barnes

I do not see how I could undertake at this stage that any particular matter should be stated in a scheme.

Mr. Assheton

Since I spoke earlier in this discussion powerful contributions have been made to the Debate by my hon. Friend the Member for Rugby (Mr. W. J. Brown), by various hon. Members from Bristol, and by other hon. Members behind me. It was observed by someone on this side of the House that the right hon. and learned Member for East Bristol (Sir S. Cripps) was not present, and it was then suggested that my right hon. Friend the Member for West Bristol (Mr. Stanley) was not present. I am glad to say that the moment my right hon. Friend heard that something affecting the city of Bristol was coming up, he left the important business he was transacting, and came hurrying back—

Mr. Alpass

He had to be sent for.

Mr. Assheton

—to 'make absolutely certain that nothing should be done which would adversely affect the interests of the city he so ably represents. After hearing this discussion it is quite clear that the Minister has done the right thing in saying that he will look at this matter again before the Clause comes up in another place, and have further consultations to see whether he cannot do better than he has done up to now. I am not one of those who believe that global sums are likely to prove a satisfactory method of dealing with these difficulties. If you start off by saying what the total bill is, and then find out what the different items are, and if the different items happen to add up to more than the total amount of money available, somebody has to go short. Once you start working on that principle you are very likely to get into trouble. In view of the fact that this Clause is one which we pressed hard for during the Committee stage, and in view of the undertaking which the Minister has given, we on this side of the House will not divide against it.

Question put, and agreed to.

Clause read a Second time, and added to the Bill.