ELECTRICITY BILL

HC Deb 04 February 1947 vol 432 cc1585-701

Order read for resuming Adjourned Debate on Amendment to Question [3rd February], "That the Bill be now read a Second time."—[Mr. Shinwell.]

Which Amendment was to leave out "now," and, at the end of the Question, to add "upon this day six months."—[Mr. R. S. Hudson.]

Question again proposed, "That 'now' stand part of the Question."

3.59 p.m.

Mr. Pickthorn (Cambridge University)

It is not from any over-estimation of my personal importance in this matter that I rather regret the absence throughout the whole or most of yesterday, and the absence now, of the Prime Minister, of the Deputy-Leader of the House, of both Law Officers and of the Chancellor of the Exchequer—[Laughter.] The right hon. Gentleman the Minister has a great advantage over the rest of us, in that when he is not audible he is, apparently, always extremely amusing. He really should try either to be audible or to keep his mouth shut, unless he is in possession of the House.

The Minister of Fuel and Power (Mr. Shinwell)

I will listen.

Mr. Pickthorn

Thank you. I was saying that I do not attribute this absence to any personal deficiencies on the part of the right hon. Gentlemen concerned. I do attribute it to what we have just had a discussion of—the excessive and indeed fantastically ridiculous rate at which we, all of us, are being asked to work. Secondly, I have to avow a direct personal interest in the matters I am about to discuss. Thirdly, with the permission of the House, I will lay out the order in which I hope to discuss these matters.

First, I want to say something about compensation; then something about the prospect of practical concrete improvements to be expected from this Bill; then something about the treatment of directors, and then about the general constitutional importance of this Bill, and of the way in which this Bill has been introduced. I put these topics, not in ascending order of importance, but I think they have something like an ascending order of importance. Not that I would suggest that the interests of directors are matters of immense importance, but because that question does, I think, form the natural transition from the question of practical improvements under the Bill, to the general constitutional question. I would begin, if I may, by saying a word about compensation. It is common for the right hon. Gentlemen and hon. Gentlemen opposite to talk about the soul of the people. That is metaphor. Peoples do not have souls. Men who talk of peoples having souls generally land in one form or another of Nazism or totalitarianism. What a people does have, which takes the place for a people, as nearly as such an analogy is ever fair, of a soul for a man, is language, and by destroying a language you do to a people what you do to a man if you poison his soul.

This word "compensation" has been destroyed from the beginning of this Parliament when the Chancellor of the Exchequer told us simultaneously, first that the public was getting a very good bargain in the Bank of England, although how there could have been any bargain in the matter I know not, when the terms were fixed by the ipse fixit of the ministerial party to it, and secondly, that other shareholders or business interests fearing nationalisation, must not expect to be treated so well. When he told us that, he made it quite clear that the word "compensation" no longer means what it used to mean, which was a "counterbalance or the rendering of an equivalent." The second general consideration I would offer to right hon. and hon. Gentlemen opposite is that you cannot, in fact, compensate when you nationalise on a very large scale. There is nothing with which to compensate except what people in the nation own, and if more than quite a low proportion of that is to be taken over, there is not enough left elsewhere with which to compensate. That I believe to be the real reason, and not particularly moral delinquency, common though I have no doubt that moral delinquency is among right hon. and hon. Gentleman opposite—we are all of us sinners, and I have no reason to suppose that they are better than the rest of us. It is to that inescapable fact that we owe this destruction of language which makes debate and discussion more and more difficult, and government by discussion mere camouflage.

There are three smaller, less general, things I wish to say about compensation. The first is that if the Stock Exchange nominal price at a given moment is to be taken, clearly payment ought to be in what the Stock Exchange was paying in at that moment, that is, in money, and in transferable money. Here the payment is offered not in money, and what is offered in lieu of money is not, so far as the Statute provides, necessarily transferable, or transferable under any particular conditions, it is left at the mercy of the Minister. Secondly, of compensation I would say that this is the first occasion, I think, in all our history where there has been the distinction which is made by this Bill between the company and the shareholders of the company, where entities brought into existence by Parliament, legitimately performing their work under the aegis and supervision of Parliament for one or two generations, the entities which own the things which the Government want, are simply being caused, by the mere bare fiat of the Government, to go out of existence, at a date not yet known, without any sort of compensation, their shareholders, meanwhile being treated in the way which is nowadays called compensation. That is a new thing. I believe it to be, constitutionally a most regrettable step.

Then, the third and last thing I wish to say on the compensation point is that the argument that, of course, shareholders ought to be satisfied with smaller incomes because they are getting better security, is now plainly nonsense. From the way in which the right hon. Gentleman the Minister of Fuel and Power talked of capital and dividends and so on yesterday, I am extremely doubtful whether his understanding is aware it is nonsense, but I cannot believe that either his Parliamentary Secretary, or the Chancellor of the Exchequer doubts that it is nonsense. There is no greater security in having the promise of a paper Dalton pound at this moment than in having a pound's worth of almost anything one chooses. If right hon. and hon. Gentlemen opposite doubt that, I would ask them whether they would sooner take a paper pound, transferable or non-transferable, at this moment, or job back to the date to be taken for the Stock Exchange price, and take a pound's worth of things, particu- larly electrical machinery, at that date. I have no doubt whatever what their answer would have to be.

I come next to the question of practical improvements in production and distribution. We heard nothing yesterday from the right hon. Gentleman to show any prospect of practical improvements arising out of this Bill. Who are the persons for whom practical improvements might arise? First they are the employees. What happens to the employees under this Bill? They will lose the guarantees they have had. And they do not get what I think I am right in saying, in legislation like this, in every year for more than 80 years until 1946 they always got—that is, a proper statutory guarantee of compensation for disturbance. They are not getting that. Really it is difficult to see what it is the workers are to get out of it. I was a little surprised yesterday to hear more than one spokesman of the unions concerned, one of whom is now present, say that all the workers were in favour. They did not all take that line not long ago, because one of them wrote a book three or four years ago, in which he said: It is doubtful if even a small minority of engineers and administrators could be mustered to support immediate nationalisation. [Interruption.] Did the hon. Member ask, "Who said that?"

Mr. John Lewis (Bolton)

What would be the position today if the people in the industry were asked what they would prefer?

Mr. Pickthorn

It is very funny: they always face the future. They always ask a question about something which is hidden by the mists of futurity or by the fog of mere assumption. I am talking about what was said three or four years ago. There have certainly been no technical changes to alter that opinion since, so the whole of yesterday's argument that what is here wanted is not political but purely technical, falls by the board. I do not think anybody can say that it is the workers who are clearly going to gain out of this. I do not suppose anybody would say that it was the shareholders who were clearly going to gain. Thirdly, then, there are the consumers. I do not propose to go into arguments about the exact prices of current here and there. I should be perfectly prepared to face those arguments on any appropriate occasion: I will say one or two things about that. Yesterday I feel sure hon. Gentlemen opposite exaggerated the contribution of the grid to the cheapening of electricity. Secondly, I feel sure that in one case, which I think was given by the hon. Member for North Wembley (Mr. Hobson), comparing prices between a company and a municipality, he did not get in all the relevant figures—but I think it would be inappropriate on a Second Reading Debate to go into those arguments in detail.

The test I would put to the right hon. Gentleman on the Treasury Bench about the probability of direct concrete improvement to consumers is this: Will he write into the Bill, will he accept Amendments to give consumers under the Statute the same rights as they have now? Will he do that?

Mr. Shinwell

What are they?

Mr. Pickthorn

Does not the right hon. Gentleman know? I guessed yesterday that the right hon. Gentleman had not read the Bill and, still less, read the earlier Acts. That was very obvious. He referred to Clause I and then jumped to somewhere about Clause 30, and left out almost all the guts of the Bill. Are they going to get a guaranteed right to receive their current at the same rate as other comparable people asking for rates for comparable purposes? That is one of the things they have now. Are they going to get any kind of fixing of price ceilings, or making it difficult for prices to go up above a certain level? Are they going to get any right of appeal to any independent tribunal, if they think they are being overcharged, as they all of them have now?

On the contrary, they are going to get none of these things. They are going to lose the check of competition on the supplier; they are going to lose the check of appeal to the Electricity Commissioners on the supplier, and the check of the possible take-over of his own concern to the supplier. All those things they are going to lose. Fourth—if it is possible at all to differentiate population into these entities, the workers, the shareholders and the consumers—if there is any fourth entity it is the general interest of the nation as a whole. Is that going to gain out of this? I do not wish to enter upon criticism of the Central Electricity Board, but I think it fair to say that if there is one part of the industry which is open to criticism at this moment, it is that part. If there is one thing clear it is that if the planners had had their way, we should, unless God had done even more for us than He did, have lost the war.

They decided before the war and during the first year of the war that generation capacity needed would be less than in peacetime—considerably less. In fact, it turned out to be considerably more. If the "chaos of private interests" had not produced that result, if the infallible planning of the right hon. Gentleman and his congeners had been left omnicompetent and uncontrolled, then, as I say, Heaven alone knows whether we should have won the war, or how we could have won it.

To come to my third head, I wish to say something about the treatment of directors under this Bill. There is nothing particularly, necessarily, unusually wicked about directors, so far as I have been able to observe, comparing them with dons, military and Air Force officers, with Ministers of the Crown, trade union secre-tarys, and with other people with whom, at one time or another, I have been permitted I will not say to mix, but at least to converse. That is why I very particularly regret the absence of the Prime Minister and the Law Officers yesterday and today. I cannot believe that if they fully understood what this Bill proposes to do in these matters, they would think it proper.

I wish to be as quick as I can. I invite hon. Members to look at Clauses 13, 15, 22, 25, 49 and 54. There are others, no doubt, but under those Clauses they will find directors of electricity concerns placed in a sort of untouchable class of upside-down privilege, treated as no men—I do not hesitate to say it—as no men under the British Crown have ever before been treated. That is a matter of immense constitutional importance. It is much more a matter of constitutional importance because the right hon. Gentleman is either unaware of it, or is now already so—I am not sure whether "insolent" is a Parliamentary word or not—overweening, that he thought it did not matter a bit and that this House could be trusted to swallow anything, that the legions behind him were safe, and that really it was not worth bothering to explain anything to the people on this side: so he said not a word about all that.

Directors of electricity concerns are to be made personally liable even though a man may have voted against the action for which he is being made liable, and even though he was serving abroad at the time. What is more, they are to be made liable for acts which are not really their acts; for some of the acts for which they are being made liable are acts which are the acts of shareholders, and for which the directors would merely be the executive or administrative authorities and not the ultimately responsible authors. Yet upon them, the responsibility is being put. And the onus of proof is being shifted the wrong way. It is a long time since I studied criminal law, and then not deeply, but at that time the only man who had the onus of proof upon him in criminal charges, was a man found lurking with housebreakers' tools in London or Birmingham.

Now, the onus of proof is being shifted to the doing of acts which may not have been really the ultimate responsibility of the man against whom it is being shifted. I do not want to go into detail about that side of the matter because my right hon. Friend who opened the Debate yesterday for the Opposition put most of it, I think, plainly enough and quite clearly. At the very least even if we are all wholly misunderstanding these Clauses, it must be admitted by the House that such Clauses should not be supposed by the responsible Minister; to need no kind of explanation or apology. That is a very remarkable constitutional milestone.

So also is this Bill a remarkable constitutional milestone from the point of view of the powers it gives the Minister. All the Bills we have passed so far in this Parliament, and all the Bills now before us, every one of them, might have the same short Title, "Additional Ministerial Powers Bill." Every one has been the same. This is as bad, or worse than most. I am not sure that I have counted right, but I think in this Bill there are 80 or 90 different places authorising the Minister to "direct," to "determine," to "require" or to "prescribe" something or other. On several of these occasions he is himself the sole judge of when he is entitled to exercise these powers. For instance, in Clause 5 (1) it is in any matter "appearing to the Minister to affect the national interest." I do not know why it should be the "national interest." I thought there was a time when national interests had been jettisoned but now apparently they will, as interpreted by a Minister, suffice any action by any Minister.

Some of these powers are framed so as to exclude any appeal against their exercise in the ultra vires ground. Then again, they involve an enormous patronage. The Minister receives under this Bill the distribution of a great many jobs of all sort's—jobs which are remunerated, jobs not financially remunerated but desirable as ministering to vanity or politics, and jobs the function of which should be to keep an eye upon the Minister. All these jobs are in the power of one man. The Minister appoints all the boards and councils, and has the power to dismiss them and each of their members as he chooses. The amount of delegated legislation which he has in his power is immense, and on this I would remind the right hon. Gentleman of his own words. He talked about coal, and said that our future depends upon the success of these experiments, and he added: We cannot afford to take risks. If we should fail with coal, we cannot hope to promote further schemes of nationalisation. Perhaps that is why the Government are hurrying all these schemes of nationalisation through. We know that there is no real necessity for them, because the Chancellor of the Exchequer told us the other day that they could do all the nationalising they wanted to do this year, and would then have a year on their hands. If that is so, was there any purpose in not trying to see if the coal experiment worked out well, or did they want to be sure there was not time to see if, before new experiments were started, it was working well or not? The right hon. Gentleman said on almost the same date: …A bad Government, a bad Minister or a bad Board could under the powers available in the Bill"— the Coal Industry Nationalisation Bill— —"go far to wreck the whole economic structure of industry, and, thereby, of the country as well."—[OFFICIAL REPORT, 29th January. 1946; Vol. 418, c. 707.] I submit that that is true of this Bill. I submit that this Bill is, indisputably, a Bill of great constitutional importance. Further, I submit this to the right hon. Gentleman. There is no constitutional im- propriety, there is not necessarily any intellectual imbecility, in supposing that this is a bad Government, and, though it may surprise the right hon. Gentleman more, it may surprise some of his colleagues less, if I add that there is no constitutional impropriety nor even necessarily any intellectual imbecility, in judging this Minister to be, even in this Government, an unusually bad Minister. The business of this House of Commons is not to pass Bills of which it can even plausibly be stated that, they put in the Minister's hands the power to ruin the country.

I wish to be short. I now come, almost, but not quite, to the end. There is a great fallacy in the argument often used by right hon. Gentlemen, and especially by the Lord President of the Council—for the cause of whose absence we are all regretful—there is a great fallacy, I say, in the argument, that we must have Bills in this form which give Ministers immense additional powers of control, in order to save time. If right hon. Gentlemen really mean their own argument, that argument must turn round and appear, even to themselves, to be fallacious. What do they say? They say to arguments that there is no proper control in this Bill in the form of accounts, or that there is no way in which Parliament can control the area boards. They say in answer that we can always put down Questions, or ask for a day to Debate the matter. The fallacy of this answer is that if this was an honest attempt to control the electrical industry half as much as if is being controlled now, today, by statute, a great deal more time would be wasted in questions and in parliamentary days than can ever be saved by this so-called "streamlined" method of legislation.

There is another constitutional point. The House will remember the phrase in Erskine May about the right of petition in Parliament for redress of grievances being regarded as being fundamental in the Constitution. Clause 10 of this Bill, in a way which I think unprecedented, though I believe it is being done in the Transport Bill also, proposes that corporate bodies legally created shall be precluded from approaching the House either to oppose or to propose a Bill. There are many other constitutional points with which I will not weary the House.

Next, I would say that the constitutional importance of these things is not unknown to right hon. Gentlemen opposite. I will say afterwards who spoke as follows: I would sooner the State got into its control key industry after key industry until, within a reasonable, time, they were substantially masters of the economic framework. Then would be the time to take the big decisions. The "Daily Herald" added to the report of the speech in question: By the time the country has become a Socialist country, they can make a clear and equitable plan, instead of insisting on a guarantee for 25 years. That was the present Lord President of the Council. In other words, they were going to be in a position of economic control, giving a political guarantee of not a five-year plan but a 25-year plan. They want to get political control of economic necessities for constitutional purposes. That was the view put by the Lord President of the Council in the sentence I have just read.

Mr. Turner-Samuels (Gloucester)

Would the hon. Gentleman look at Clause 10? He has just said that it prohibits petitioning to Parliament. Would he look at Clause 10 and tell the House where that appears?

Mr. Pickthorn

No, I would not. I think the hon. and learned Gentleman is well able to do it himself, and, anyhow, I have passed that point. I rather guess that the hon. and learned Gentleman is not as learned about the word "petition", and the relation between petition and Bill, as he is leading the House to suppose. I think that may indicate the answer to his question. I should now like to read, as a supplement to the extract which I have read from the Lord President, a sentence from the right hon. Gentleman the Minister. He said: Without increased production and a greater effort on the part of everybody, we shall fail. Of course, obviously, any Government will succeed if everybody behaves better than they did before and produces more. The right hon. Gentleman went on: No doubt, there are people in our country who would delight in our failure. Unfortunately, failure for the Government would mean failure for the country, and that none of us can afford. By Heaven, none of us can. We could not find a phrase which, more simply or more strongly, puts the case against the policy of this Bill than that sentence. This Bill intertwines in large measure the mere party fortunes of the second-rate and ephemeral men who happen to occupy the Treasury Bench. That policy intertwines the interests of these men with the general interest of the country, so that they may presume to threaten the country that, if they fail, the country will be ruined. That is an intolerable thing for a Minister to say to the inhabitants of these Islands.

4.28 p.m.

Mr. John Lewis (Bolton)

I am very glad to have the opportunity of catching your eye, Mr. Speaker, immediately after the senior Burgess for Cambridge University (Mr. Pickthorn). I remember that, a day or two after I took my seat in this House, I smiled at a certain statement by the hon. Gentleman, who warned me that I should find myself in intellectual difficulties if I followed this course. From my limited experience, the cut and thrust of Debate has always been characterised by courtesy, but I will say, so far as the hon. Gentleman is concerned, he characterised his remarks with pugnacious offensiveness, and would expect Members of the Cabinet to leave their Departments in order to come into the House to hear him.

Mr. Pickthorn

Certainly, that is what Parliament is for.

Mr. Lewis

The hon. Gentleman has just said that, when my right hon. Friend is not audible, he is extremely amusing. May I assure the hon. Gentleman, on behalf of those who sit on this side of the House, that he is least amusing, when he is most audible.

We witnessed a somewhat extraordinary spectacle yesterday when the right- hon. Member for Southport (Mr. R. S. Hudson) stood up to answer the case put forward by my right hon. Friend the Minister of Fuel and Power. Instead of being supported by the ranks of those who, on previous occasions, when Bills for nationalisation have been under discussion, have always acclaimed with resounding cheers the statements from the Opposition Front Bench, the right hon. Gentleman found himself, on some occasions, in splendid isolation. We have a right to ask ourselves why the right hon. Member for Southport, who is regarded in some parts of the House as being an agricultural expert, should have been called upon on this occasion to reply for the Opposition. Where was the right hon. Member for the City of London (Sir A. Duncan)? Where was the right hon. Member for the Scottish Universities (Sir J. Anderson)? On many occasions, we on this side of the House disagree with the views expressed by those right hon. Gentlemen, but, at least, we respect their views, because we know that they are based on knowledge and experience.

Mr. R. S. Hudson (Southport)

Would the hon. Member allow me to tell him that it so happens that the right hon. Gentleman the Prime Minister and I are the only survivors in this House of the Committee of this House which originally got through the 1926 Electricity Act? Actually, I think there are three of us.

Mr. Shinwell

indicated assent.

Mr. Hudson

We are the only survivors. Therefore, the hon. Member cannot say that I do not know anything about it.

Mr. Lewis

I am obliged to the right hon. Gentleman. May I say that I would have been impressed by his argument had I not heard his speech? With respect, I think that the right hon. Gentleman is to be congratulated in that he had the courage to stand at the Despatch Box and make the kind of speech he did, lamentable performance though it was. We on this side of the House, and hon. Members sitting in other parts of it, do not know what the official Conservative policy is with regard to this matter. The argument of the electricity supply companies, which is, to some extent, supported by hon. Members opposite, and which is published in a document entitled "To those with Open Minds"—not" Let us Face the Future"—runs as follows: The industry is not, and never has been, a field of pure commerce. Where it has been built up by free enterprise, it has been within a statutory framework which has subordinated private to social aims, and that is the case today. The industry is, and is content to be, under close statutory supervision. Quite clearly, the view of the power companies, as expressed in this document, is that the status quo in the industry should be maintained—in short, that there should be no alteration. That, presumably, is the view of the right hon. Member for South-port, since his arguments were purely negative; he did not put forward one positive constructive alternative to the case presented by my right hon. Friend.

Mr. R. S. Hudson indicated dissent.

Mr. Lewis

I read the right hon. Gentleman's speech in HANSARD very carefully this morning, and I failed to find any reference to those and other matters, to which I shall refer in a moment.

There is another section of the Tory Party which feels that the best way of dealing with the electricity industry would be to implement the recommendations of the McGowan Committee, or those of the White Paper which followed. It is significant that, in his speech, the right hon. Gentleman omitted to refer to two of the most important recommendations of the McGowan Committee, which are as follow: Any attempt to carry through a scheme of reorganisation on a voluntary basis is bound to fail, and legislation must confer definite and adequate compulsory powers. The schemes of reorganisation should make provision for the possibility of ultimate public ownership of all undertakings, including those not at present subject to purchase by the local authorities.

Mr. Hudson

The hon. Member must really be a little more accurate. I did not refer in my speech to any recommendation by the McGowan Committee; the only time I referred to it, was to refute a remark made by the Minister.

Mr. Lewis

I am grateful to the right hon. Gentleman because-he has borne out what I was saying. I refer to the fact that he did not deal specifically with any particular policy; his attitude was purely negative. Had he done justice to the case of the hon. Members sitting behind him, it would have been his duty, in the circumstances, to refer to that particular recommendation in the Report which stated that the ultimate public ownership of all undertakings … is essential in the industry. Therefore, it is quite obvious to those of us who sit on this side that, on this matter, the Conservative Party is divided in its ranks.

I now propose to deal with one or two other references by the right hon. Gentleman to the young and efficient industry to which he referred in the course of his speech. In Column 1431 of the OFFICIAL REPORT it will be seen that the right hon. Gentleman sought to question my right hon. Friend, whether or not it would have been necessary to nationalise the coal industry had there been voluntary amal- gamation, had there been no industrial strife, and had the output multiplied tenfold in the course of the last 20 years. I think it is fair—we on this side of the House always try to be fair to the Opposition—to examine what might be considered to be a reasonable argument, in view of the fact that they were so few and far between in the speeches which we heard from the Opposition benches yesterday. I would like to ask the right hon. Member for Southport, had the output of the coal industry increased twentyfold, and if he, personally, were satisfied that under a system of national ownership—and only under a system of national ownership—would it be possible to increase it fortyfold—whether in these circumstances he would then have stood at the Despatch Box, and said to my right hon. Friend that the nationalisation of the coal industry was not in the interests of the nation as a whole?

For that reason, I think that we are entitled to examine the degree of efficiency to which so much reference has been made from the Opposition benches. I concede that there has been efficient organisation in the electrical industry, and that some of the power companies are extremely efficient. But what the Opposition fails to realise is that efficiency is purely relative, and that, in so far as the electrical industry is concerned, whereas there may be certain constituent parts which are in themselves efficient, as far as the whole framework of the industry is concerned, the situation has somewhat to be compared with the situation of the constituent parts of that organisation which comprised the London Passenger Transport Board before it was incorporated.

Hon. Members opposite referred to gas as being a competitor of electricity. For that reason, they attributed some of the efficiency in the electrical industry to the competition of the gas industry. That would be true were the national expenditure on gas lower than that on electricity. In point of fact, however, and I do not believe that it is generally known among hon. Members that, as far as our national Budget is concerned, whereas we expend £550 million per annum on tobacco and hundreds of millions on liquor, we expend only £63 million on gas and £54 million on electricity. That seems to me to indicate that if the gas industry is consuming more than the electricity industry, the tendency on the part of the electricity industry must be to increase the efficiency of the gas industry, and not vice versa. No doubt hon: Members opposite will use that argument when, as I hope shortly, my right hon. Friend the Minister of Fuel and Power introduces a Bill to nationalise the gas industry.

The other point the right hon. Gentleman made was that competition reduces costs. When we consider the question of advertising, is that true? Is it true to say that, in so far as showrooms and advertising are concerned, costs are brought down because of the competition between the gas and electricity industries? I submit that the position is nothing of the kind, and, in view of the fact that both gas and electricity derive their power from one common source, which is coal, it will only be possible to plan for the maximum thermal efficiency when the whole of the fuel and power industries are co-ordinated on a national basis.

What is the basis of efficiency to which hon. Members opposite attach so much importance? I think the criterion is profit, and I am not saying that they are not right. So far as the profits of a private company are concerned, we must obviously accept that if it cannot run at a profit it cannot run at all, and, as to day 80 per cent. of the whole of our in dustrial activity throughout the ountry is in the hands of private enterprise, it is foolish to say that that private enterprise should operate at a loss, because it would not function. I think that is a reasonable argument but in so far as public utilities are concerned it must be a reasonable profit. There is absolutely nothing to establish that the local authorities and private power companies have been as efficient as they possibly could have been, by reason of the fact that they have exercised a virtual monopoly and it is no use denying that that monopoly has existed.

I heard an hon. Member opposite yesterday say that it is possible for certain consumers to get supplies from alternative sources. Those of us on this side of the House who know something about industrial matters understand full well that it is not practicable, and that it would not pay a consumer to bring a cable 10 miles if he had the service laid on in the road outside his premises. I think the reason why the price of electricity has come down over the past 20 years is because the electricity supply undertakings have been faced with a constantly increased demand. Until the demand becomes stabilised or until the law of diminishing returns operates, it is impossible to tell whether or not they have reached the peak of efficiency which they would have reached had there been national reorganisation under public ownership at a much earlier date. The fact that the prices have come down over the past 20 years is no criterion whatsoever of efficiency, but is an indication of the principle, well appreciated by industrialists, that with increased turnover and output overheads are reduced.

The cost of generation between 1924 and 1934 fell from.963d. to.5231d. per unit. The cost of distribution, however, remained constant at about 766 of a penny per unit over the whole field of electricity supply which includes the private companies and the municipalities. The fall in the cost of generation and transmission due to the efficient system which was imposed upon the industry in 1926 by the Central Electricity Board and the fact that the only section where there was no drop in costs was on the distributive side, clearly indicates that distribution should be nationalised, and I do not think there is any argument that can be put forward to refute this argument.

I do not think any hon. Member who has spoken from the opposite benches has failed to refer to the dislocation which will result from the implementation of my right hon. Friend's proposals. But very few of them have attempted to refer to the form that it is suggested this dislocation will take. Is it suggested that the selected stations will cease to provide power to feed the grid? Will local authorities and private companies cease to supply electricity? I would like to refer those hon. Members to the electricity supply companies' statement, which was referred to in another respect yesterday by my hon. Friend the Member for Winchester (Mr. G. Jeger): The electricity supply companies are not allowing any uncertainty about the intentions of this Government to interfere with their duty to the public. They are proceeding with the five-year programme outlined above, and no threats or rumours will deter them from fulfilling their promises of extending, increasing and cheapening the electricity supply of Great Britain. I prefer to accept the assurance of the power companies that they will carry on doing their duty, and I am not impressed by the argument that there will be any dislocation whatsoever for the electricity industry when the vesting day dawns.

On the question of the security and length of tenure, I would like to refer to a document prepared by the Tory Reform Committee. This document purports to put forward the argument that the McGowan Committee's Report should be implemented. I know that it disagrees, to a large extent, with the statement made by the right hon. Gentleman the Member for Southport but, nevertheless, it is a document put forward officially by the Conservative Party.

Mr. Pickthorn

Tory Reform Committee documents do not necessarily bind the Conservative Party.

Mr. Lewis

The hon. Gentleman's intervention amazes me. I thought the Tory Reform Group was associated with the Conservative Party, and I have heard the view expressed from time to time on all sides of the House that those documents which have some connection with the Conservative Central Office have at least the general approval of the majority of hon. Members sitting on the benches opposite. I must admit that I am somewhat surprised to hear that the senior Burgess for Cambridge University disowns this pamphlet which has been prepared by the Tory Reform Group.

Mr. Pickthorn

The hon. Gentleman said that it was a Tory Reform Committee document, and that it has been officially put forward by the Conservative Party. All I am saying is that the two are not identical, any more than it is possible to say that documents emanating from hon. Members opposite, necessarily bind the Socialist Party.

Mr. Lewis

I am obliged for the intervention of the hon. Gentleman. He said, so far as I can understand, that the Tory Party and reform do not go together, and I am quite prepared to accept his statement. I wish to refer to a statement which appears in this document. In the light of some of the speeches we heard yesterday from the benches opposite, I think it is a good document because it makes certain honest admissions. It is a carefully prepared document and puts forward an argument which might be considered to be reasonable. On page 18 of this document the following statement appears: Security and length of tenure. The McGowan Committee stipulated that where power companies are retained under the new organisation, the consolidated undertaking should, at the end of a prescribed period not to exceed 50 years, be liable to purchase by some form of public authority. The statement goes on to say: This provision appears to aim at future homogenity of ownership, and was possibly intended to bring the Committee's recommendations into line with the express intentions of the early Electric Lighting Acts, that electricity supply should eventually become a public service. I would like to know whether this is a confession that, owing to this sense of insecurity and the absence of guarantee of tenure to which reference is made the private companies have not extended and developed in the rural areas as they should have done or as it was possible for them to do. Is that an admission? If it is not an admission, and if the recommendations of the McGowan Committee or of the right hon. Gentleman the Member for Southport are implemented—hon. Members opposite may take which of them they prefer for the purposes of my argument—I should like to be told what guarantee we have that the power companies will be forced to provide a service in the rural areas. I suggest there is none at all. But at least we can be satisfied of one thing, namely, that public ownership does guarantee the provision of all amenities in the national interest, irrespective of considerations of security or tenure; nor will they be hampered by any question of insecurity so far as future profits are concerned.

On one of the principal recommendations of the McGowan Committee, I think there is one thing we can say before we leave that point. The Committee most certainly recognised that any scheme for reorganisation on a voluntary basis was doomed to failure. And that was a Committee of experts set up to look into the question. I am at a complete loss to understand how hon. Members opposite who have taken part in this Debate have not been prepared to make that concession at the commencement of their remarks, because quite obviously it would determine the nature of most of their subsequent arguments. I think they were quite right in asking in what way nationalisation can benefit the consumer. After all, that is a most important question. But as far as the two alternative propositions put forward by the Opposition are concerned, it is my view that only national ownership and centralised management can effect those important economies which can benefit the consumer. We know, for instance, that under the present system local authorities and public companies own selected stations. And the Central Electricity Board buy the power from these undertakings, and then sell back to them what they, need for their own consumers. I suggest this involves a highly complex system of accountancy. Surely hon. Members opposite must concede that under national ownership this present necessity would be eliminated, and thus effect an important economy in the general administration in the industry as a whole?

It is, however, in the field of distribution that, in my view, the greatest benefits will accrue. Here, I must say the Opposition's case, if there was a case, was at its very weakest. The first task of a nationalised industry must involve redetermination of the areas of supply. I think that will be agreed that redetermination should have some relation to the national and local requirements. In spite of the fact that under any scheme of reorganisation many of the small uneconomic units will be eliminated, I think the principal recommendation of the McGowan Report in this respect was that areas should be created which might involve the necessity of private companies taking over municipalities, in other areas municipalities taking over the private companies. I would like to ask hon. Members opposite, who will have to make their peace with their constituents, how they are likely to react to the suggestion that consumers who have been buying electricity from a local authority should be placed in the tender care of a private company under their scheme? I think most certainly that such a proposal would not be generally acceptable.

I must reiterate another point, although it has been said so often when dealing with the question of nationalisation of our basic industries. The party sitting on this side of the House has a mandate to nationalise the electricity industry because it undoubtedly did appear in the book called "Let Us Face The Future," to which the senior Burgess for Cambridge University referred. We should be failing in our duty were we not to implement our promise in this respect.

Mr. Boyd-Carpenter (Kingston-on-Thames)

Like the Minister of Health in regard to housing.

Mr. Lewis

I now wish to deal with some of the differences which exist be tween the areas concerned, both in respect of the McGowan Committee Report and my right hon. Friend's Bill. In view of the fact that hon. Gentlemen opposite are looking at the clock—[HON. MEMBERS: "Hear, hear."] I am not going to stop for a moment or two—I will confine myself to saying this. The difference be tween the two schemes is that whereas in the Bill it is intended to permit a rural area to be carried by an industrial area so that there shall be expansion outwards, so that the good area shall carry the bad, in the McGowan Committee Report this consideration is not taken into account at all. I could give specific examples to indicate the difference between the two schemes if any hon. Member should so desire. On a comparison between private companies and municipalities there are facts and figures which will undoubtedly substantiate he necessity for this Bill, so far as capital debt, interest charges and dividends are concerned. In those particular cases where private companies have been supplying urban areas, although they sold more units than the boroughs in hose particular areas they were still dearer, which is significant. I do not wish to take up the time of the House further on that. If any hon. Member cares to question those figures I shall be quite happy to give them.

The point which does more to disturb the minds of hon. Members opposite than anything else is the question of compensation. What they have failed to realise is the point which is expressed this morning in "The Times" editorial. There is an element of monopoly value in the price at which the shares exist, but what hon. Gentlemen opposite fail to comprehend is that some of us on this side of the House know just as much as they do about the financial structure of any industry. When my right hon. Friend was attempting to prove, as he did yesterday, in my view quite conclusively, that if bonus shares are issued and the dividends are halved, that profit which should have gone back to the consumer, by way of reduced charges, is being put into the pockets of the shareholders.

Lord Roy den, the Chairman of Edmundson's Electricity Corporation, was at great pains, in the summer of last year, to point out how his organisation had been responsible for giving the consumers the benefit of the efficiency which had grown up over a large number of years. What do we find? We find there was a bonus issue of 50 per cent. in 1938; but also that there was another one previously, in 1924, so much so that those shareholders who were fortunate enough to have stock in Edmundson's Electricity Corporation before 1924 are not getting 37½ per cent. on their investment—which is the declared dividend—but are getting 37½ per cent. on their money. The difference between the 7 per cent. and the 37½per cent. should have gone back to the consumers by way of reduced charges.

I have one final appeal to make to my right hon. Friend. I know the question of compensation for local authorities must be occupying his attention. Frankly, I should say there is no ethical ground whatsoever for any compensation being paid, to them, for the simple reason that in the same way as private companies were using their profits and reserves for bonus issues and thus have declared a higher dividend than they should* have done, local authorities have been doing precisely the same by means of rate aid from the proceeds of electrical undertakings. These proceeds should have gone towards reducing the price to the consumer. The point I want to impress upon my right hon. Friend is that what has happened in the past, must rest in the past. The senior Member for Cambridge University said that we are all sinners, that even the municipalities have sinned in this matter, but I hope that in his compassion my right hon. Friend will at least give consideration to the position in which some municipalities will be placed, in particular my own constituency, in regard to this particular matter. I am, however, quite prepared to make it clear in my own constituency that what in my view would be a strictly ethical system to be adopted by the Minister would be that there should be no compensation at all. I have gone very carefully into this matter and although my own local authority is very much concerned I hope my right hon. Friend if he does make concessions will not give way to unreasonable demands.

I support this Bill because it is a good Bill. I support it as one who has a certain knowledge of industry; I think our industrial recovery and reconversion can be assisted tremendously by the implementing of a Bill framed, as this is, to assist the nation's power supply. In Lancashire there are still dozens of old steam engines running mills which should be switched over to electrical transmission. We know that as far as thermal efficiency per unit is concerned the country would benefit were they to be converted from the direct use of coal to electricity. It is only through this Bill that it will be possible to get a nationwide scheme, which will give consumers of all classes, domestic, agricultural and industrial, the reorganisation which is so vitally necessary. I commend the Bill to the House.

5.2 p.m.

Sir Arnold Gridley (Stockport)

Before I embark upon the points I wish to develop in my speech, I would like to deal at once with one or two observations made by the hon. Member for Bolton (Mr. J. Lewis). One statement he made was that the power companies want the present status to remain. That is not true, and I shall deal with that further in my subsequent remarks.

Mr. J. Lewis

rose—

Sir A. Gridley

I shall be dealing with it in the course of my speech, and I do not want to be interrupted, because I have a great deal to say on this occasion. Another statement he made referred to a quotation from the McGowan Report. The words that he used, I think, said that future legislation must anticipate the possibility—it put it no higher than that—the possibility of purchase by the public undertakings.

Mr. Lewis

Perhaps the hon. Member will permit me to say that I was quoting from the Tory document known as "Power."

Sir A. Gridley

I cannot accept that. In an earlier part of his speech the hon. Member quoted from the McGowan Report.

Mr. Lewis

I have not a copy of the report here. I only quoted from the Tory document specifying the report.

Sir A. Gridley

I beg the hon. Member's pardon if I misunderstood him, but I want to make it clear that the McGowan Report only contemplated the "possibility" of ultimate purchase. There was no certainty whatsoever. Then the hon. Member quoted a figure which I really could not follow. If I understood him he said that the revenue from the sale of electricity was £50 million a year. He was making a comparison between the apparently slow progress of electricity sales as compared with gas.

Mr. Lewis

I said that national expenditure on electricity was £54 million.

Mr. Deputy-Speaker (Mr. Hubert Beaumont)

The hon. Member must rise when he addresses the Chair.

Sir A. Gridley

Very well, I will deal later with that particular point. There is one other error he made which I think might be corrected at once. The Central Electricity Board is in no sense responsible for the great economies that have been achieved by the power stations. It does not own the power stations; what the Central Board owns are the main high tension transmission lines linking one station and another. As the hon. Member knows, his own constituency of Bolton owns a very important power station, and any economies that may have been achieved in that station have been achieved by the Corporation's own engineers. Of course, when a company or a municipality is asked nowadays to put down a new power station, or to extend an existing one, there are technical conversations with the officers of the Central Board, and between them they decide what type of plant should be put down, but it is misleading to say that the successes which have been achieved by municipal and company engineers in making economies have been due to the introduction of the Central Electricity Board. I would like to reply to one other question he raised, namely, when he asked whether an industrial power user formerly taking a supply from a municipality would like the responsibility transferred to a power company. There are many places where that has happened, and in all my experience I have yet to learn that an industrial power user has had the slightest objection, so long as he has continued to get good service at a fair price.

I have never intervened in a Debate with a deeper sense of responsibility since we debated in this House, in the last Parliament, the Beveridge fuel coupon proposals which were strongly sponsored by the then Government. Fortunately wiser counsels prevailed and the scheme was dropped. It Is perhaps not necessary for me to declare to hon. Members my personal interest in this industry, for I think it is widely known. It is true that I have been actively engaged in it now for, I am sorry to say, nearly 50 years, and during that long period I have had experience of serving under a large municipality, as head of a Government Department—as Controller of Electric Power Supplies in the Ministry of Munitions during the first world war—later in another Government Department, and more lately in private enterprise undertakings. Starting at the very bottom, I have seen this industry grow into the vast and efficient industry it is today. I saw some of the first attempts at are lighting in the public streets, and I saw the first electric tram line put into operation. Today, as the House probably knows, I am a director of one of the large power companies and I am also chairman and deputy chairman of some smaller company undertakings. I am not ashamed of it, nor am I ashamed of the record of those who have built up this great industry, whether in municipal undertakings or private enterprise. Although I do feel very deeply some of the monstrous proposals which are contained in this Bill, I want to discuss it today constructively, without heat and with restraint, and I hope the House will give me a patient hearing, as I know it invariably does when the speaker is a Member who has had life-long experience in the subject under discussion.

I claim at once that the industry has put up a performance over the years surpassed by none. I know well from personal experience the tremendous services it rendered to the nation during the first world war. During the four years I was at the Ministry of Munitions, the development equalled that of the previous 32 years. All hon. Members know how, again, in the second world war, the industry stood up to the terrific calls that were made upon it, in spite of the enormous handicaps it faced by reason of the difficulty of getting the right kind of coal and sufficient labour. Having said that, I would not assert that in the present structure of the industry there are no improvements that could be made. There are certain defects which are capable of being remedied, and it is with those defects that I now propose to deal.

In the first place, there is too large a number of small undertakings, both municipal and company It is too often assumed that the responsibility for this lies with those who have developed the industry, but that is not the case. Who, then, is responsible? Let hon. Members realise that just as we today are responsible for the legislation we are enacting, so past Parliaments were responsible for any Parliamentary mistakes that were made in the past. It was past Parliaments that were mainly responsible for the fact that there are so many separate undertakings today.

In the early days, when we knew nothing about alternating current and its possibilities, we were confined to the distribution of direct current over small areas, but those small areas could have been larger had Parliament been wiser. It was both technically and administratively impracticable to transmit current any great distances, such as we do today, and Parliament at that time, as the Minister said yesterday, decided to grant powers to establish electricity undertakings, either to companies or to municipalities, only for local area? which were invariably the municipal boundaries. Where companies were given powers to develop undertakings in those municipal areas, the local authorities were given the right to purchase the undertakings after 21 years. The people who were finding the capital at that time and who had to wait for, perhaps, four or five years before there was any hope of their getting a return on it, found that the period of 21 years was too short, and consequently, further representations were made to Parliament, with the result that the period of 21 years was extended to 42 years. But still those small areas were left to go on as they were. So unwise were our past legislators—let us be sure that we are not equally foolish today—that they even prevented by Statute one electrical company or municipality from having any association with another. That, surely, was isolation run mad. As time went on, however, there was a move towards grace, and at last undertakings were allowed to go so far to marry up with one another that they could enter into an agreement to exchange current, and that was all.

Meanwhile, the progress of science and invention brought the use of alternating current into practicability, and although many millions of capital had by that time been spent on direct current generating stations, the more enterprising undertakings, both company and municipal, risked their capital on building alternating current stations and developing more lengthy alternating current transmission networks. Here, again, the development was limited on account of the large number of undertakings already in the electricity industry, and this gave rise to the formation of power companies, because the more progressive and skilled engineers of the day gave evidence before an important Parliamentary Commission that the then structure would not put at the disposal of domestic users and industrial users this new form of power in the best possible way unless very large areas of supply were authorised and companies formed for the purpose of providing big power stations and mains networks which ran into hundreds of miles That is how the power companies came into existence.

They were, however, limited, in so far as their powers were concerned, because they could not enter into the area of any municipality or company which already had powers inside the big power area authorised by Parliament, but could only give those undertakings supplies in bulk. Outside those existing authorised areas, they were able to supply both industrial and domestic users. That accounts for the fact that, as the hon. Member for Bolton said just now, the prices charged by the power companies were sometimes higher than in the case of the municipalities. Obviously, if one is supplying a small area which is very densely populated, one can supply it at a lower price than one can supply a great rural area where only one-tenth of the number of consumers are connected per mile of cable.

I have ventured to trouble the House with that brief historic survey because it is necessary if one is to understand the structure of the industry today and to appreciate why the next defect to which I will refer arose. There was, as a result of the legislation, that overlapping of direct current and alternating current systems. This was unavoidable. In its turn, it gave rise to the varying voltages and systems of supply. I do not wholly blame past Parliaments for these minor defects, for obviously the progress of science and engineering were also partly responsible, but when one is dealing with an industry and one cannot tell what future developments may take place, just as past Parliaments made mistakes because they could not foresee what the position might be in 10, 20 or 30 years' time, so today which of us can be absolutely sure that we have sufficient knowledge and experience to be able to say what will be the best form of structure for this industry to enable it to develop in the best way to the advantage of the nation in the future?

Complaints are also made—and this is the third defect to which I wish to refer—about the variation in tariffs, but if, as many of us agree, there ought to be some rearranging of the industry, and if there are set up a small number of larger areas instead of a large number of small areas, then the question of variations in tariffs would practically solve itself. I accept frankly that there are these defect's, and I have explained, I hope clearly, as I see the position, how they have arisen and what responsibility past Parliaments had for that state of affairs. Notwithstanding these minor defects, the industry has shown a most remarkable expansion both commercially and technically. In my time I have seen the efficiency of boiler plants so advanced that to one lb. of coal per unit generated in these days we used five lb. of coal in the days when I was a younger man in the industry. The industrial uses to which electricity can be applied have been vastly increased, because of the immense application of electrical engineers, both in company and in municipal service. This is true also in the manufacture of electrical plant. The two sides of the industry work admirably together. There is no other industry, I say in reply to the point made by the hon. Member for Bolton, that has spent so much capital annually in its own development as has this industry. It has built up so sound a reputation that it is able to raise capital today as if the undertakings provided gilt-edged security.

I know that the House is no great lover of figures but there are a few which I would quote, showing the development that has been made possible, and how the average price to the consumer has fallen. The units sold in 1922 were 3,000 million. By 1939 that figure had increased to 22,500 million, or seven times the growth in the 17 years.

Mr. J. Lewis

Is that both public and private undertakings?

Sir A. Gridley

These are the public service undertakings figures from which I am quoting. From 1939 to 1944 which includes four years of war, the figure increased to 32,000 million, which was another 50 per cent. increase. Between 1922 and 1939, the average price to domestic users fell by 72 per cent., and to industrial users by 61 per cent. in spite of the cost of coal having increased by 124 per cent. to 140 per cent. in different parts of the country, and wages and materials also having risen in cost. This immense reduction in charges to the consumer took place in face of increased costs. I would ask the hon. Member for Bolton to bear that fact in mind. The reductions were made possible largely because of the technical improvements in steam generating.

In 1922, 690 units were generated from a ton of coal. Today—if we can get proper coal—we have increased that 690 to 1,635. There you have an immense economy achieved in the power houses of the country. I suggested just now that no other industry spent such immense capital sums. Between 1922 and 1943 the industry spent £537,750,006 of capital expenditure. The total capital expenditure of the public and private undertakings by that year had reached £681 million. Is there any other industry to which any hon. Member can point that has annually spent so large a capital sum on development as has this industry? During the same period, the number of consumers increased from 2½millions to 8 millions and—this is an important point—the units sold per head of the population increased from 73 to 666. Those figures show that there has been a most amazing growth. It is indicative of the fact that this vigorous industry has been efficiently managed.

What hope has the Minister of Fuel and Power of cheapening electricity in the future? At what price will he be able to put coal at the disposal of the power stations? They are consuming today 26 million tons of coal per year. Put the price up by 5s. a ton; what is that? It is £6½ million added to your cost right away. Power stations being put up today, being ordered today, are costing 60 per cent. more in capital cost per kilowatt than they were before the war. Interest and depreciation charges will have to be met upon that capital. For Heaven's sake let us not mislead the nation into supposing that the Bill will lead to cheaper current. I honestly think that the Minister is attempting an utterly impossible task.

Now let me say a word on a subject to which I was glad to hear the hon. Member for Bolton make a favourable reference—the power companies. I pointed out that the power companies, supplying electricity through their great areas, risked enormous capital in dealing with areas of 3,000 or more square miles. What was their earliest history? Scarcely one of the companies, started between 1900 and 1902, were able to pay any ordinary dividend at all until the great war of 1914–18. Then the demand doubled, and, for the first time, business was thrust upon those companies. At last they were able to start to pay a dividend. Those companies have created now a goodwill, and they had every reason to expect that, under the statutory powers which were granted to them, they had a right to continue to carry on their work in perpetuity. It is now proposed to wrest those undertakings from the power companies, on totally inadequate financial terms, just as the municipal undertakings are going to be grossly and unfairly treated.

Another fact that I want hon. Members to get into their minds is that nearly two-thirds of all the electricity produced today by companies and municipalities is used for industrial power purposes, and only one-third for domestic purposes. Where do we get any complaint from industry that it is not satisfied with the service it is getting, and that it is not being supplied on fair and reasonable terms? Why has this industrial load grown so enormously for industrial power purposes if the users have not been supplied cheaply and efficiently?

Mr. J. Lewis

They cannot get enough power.

Sir A. Gridley

One never hears a word of complaint. I challenge any hon. Member to produce any evidence that industry is at all dissatisfied with the service that it is receiving from the public service undertakings.

Mr. Lewis

Will the hon. Member allow me to interrupt him on this point? The trouble with industry today is that while the service is good—it must be conceded that it has been good service for many years—there is insufficient plant to meet the demands of industry. That is the responsibility of the industry that is a legacy from the past.

Sir A. Gridley

I must say, from my experience, that the hon. Member is entirely wrong.

Mr. Lewis

Is there enough plant today?

Sir A. Gridley

Of course there is not. There has been a war. The undertakings were not allowed to extend their powerhouses. They made demands on the Government for extensions during the war, which demands, I happen to know, were severely cut down. That is one reason why we are short of plant today, and are likely to be short until 1950.

Mr. Shinwell

Would the hon. Gentleman say that again, for the benefit of his friends on those benches?

Sir A. Gridley

I do not think there is any need for me to give any information to my hon. Friends on this side. I think they are as well informed as I am.

Mr. Lewis

It is not due to coal shortage in the main.

Sir A. Gridley

It is due partially to the fact that we are short of plant today, and load has to be shed to a considerable extent due to the fact that we are not getting in the power stations the kind of coal to enable us to generate another 400,000 horse-power. If the Minister challenges me on that I will meet him with a report issued by the Central Electricity Board.

Mr. Shinwell

The hon. Member can read what he pleases, but I am also in contact with the Central Electricity Board, and I know the Central Electricity Board. While it is perfectly true that we know of complaints that have come from' power stations in respect of the quality of coal—though we admit that, and I do not seek to dispute it myself, because, on occasion, it is so—at the same time, the fact that load has to be shed, and has been shed frequently of late, is not attributable to shortage of coal or to the quality of the coal, but is entirely due to the inadequacy of the plant.

Sir A. Gridley

I do not want to quarrel with the Minister—at is never my desire to quarrel with anybody—but what he has just said is true only in part. The fact is that the shedding of load today is due to two factors. One is the insufficient quantity of plant in the power stations, and the other is that another 400,000 horse-power could be turned out by those plants if the right kind of coal were available. That is the truth. I would refer the right hon. Gentleman to page 15 of the 18th annual report of the Central Electricity Board, 1945.

When I was interrupted, I was saying that there is no demand from industry for any change in the structure of this industry. They are perfectly satisfied with it. If I want any reinforcement of that I would remind the Minister and the House that in the past few days the Minister has received reports from the Federation of British Industries, the London Chamber of Commerce and the Association of British Chambers of Commerce, all saying that they do not want this Bill. They speak for the users of electricity.

Mr. Shinwell

They do not speak for the nation.

Sir A. Gridley

This industry's assets are not what the Chancellor of the Exchequer has described as a bag of poor assets. Its assets are worth every penny spent upon them, less the depreciation sum by which they have been written down. Nor is there any truth in what the Leader of the House said in Bristol in April, 1945. It is extraordinary how little Ministers opposite seem to understand this matter. The Leader of the House said: Electricity is an industry in which the middleman's part is played by a public board whose operations have been notable for efficiency and enterprise, the Central Electricity Board. The Central Electricity Board does not play any middleman's part. It is a central board who are responsible for seeing that adequate power stations are provided and linked up with the main transmission networks, and that those networks are extended as and when necessary. But the Lord President went on to say: On either side of the middleman's field there is chaos and muddle the continuance of which the most diehard Conservative do not defend. There is no chaos and muddle, other than that for which past Parliaments have been responsible. The engineers and administrators of this industry have done a great work—[An HON. MEMBER: "Hear, hear."]—and I am glad to hear that that is admitted by my Friend the hon. Member for Wimbledon (Mr. Palmer), with whom I had the pleasure of debating this subject some little time ago.

The Lord President went on to say: On the plain merits of the argument there is an overwhelming case for public ownership. Public ownership, mark you—not State ownership; public ownership. Two-thirds of the industry is in public ownership, and, therefore, the demand of the Lord President for public ownership is, to a great extent, already satisfied.

Mr. J. Lewis

But it is unco-ordinated

Sir A. Gridley

Let me point this out. We have heard yesterday and again today certain Members on that side refer to the views of local authorities owning supply and distributing undertakings, and say that they are willing to come in under this scheme. Well, Sir William Walker is chairman—I think he is still the chairman: if not he has been for many years—of the Incorporated Municipal Electrical Association; and speaking recently in Manchester, what did he say? He said: Everyone on the local authority side has devoted his time and attention, unpaid, to the idea of public duty in order to make electricity supply success, and now we are told we are not competent to continue as public authority representatives to work the orders that we have given to us by Parliament to provide and distribute electricity. To our Jeep grief we find the great and most successful organisation that has been built up jeopardised by something entirely new and untried, and that may not be a success. Those are dignified words. Surely, there is no case for divesting of their undertakings great cities like Liverpool, Manchester, Sheffield, Birmingham, Glasgow, amongst many I could mention—including my own constituency Stockport, which has a very successful local electricity undertaking, and from whom I received a telegram since the House sat at 2.30 o'Clock. It reads as follows: Stockport Electricity Committee resolved with only two abstentions that Government be requested to amend terms on which assets of municipal undertakers be acquired and to provide adequate compensation for loss which will fall on local authorities' ratepayers. Resolution subject to confirmation by Council today. Committee request your support. Town Clerk, Stockport. I have not the least doubt that that decision of the electricity committee will be endorsed by the Council. Probably, it has been by this time.

I must pass very briefly to touch on one or two Clauses in the Bill. Clause I (6 b) deals with one of the purposes of the Bill, which is the cheapening of current, so far as is practicable. I have already dealt with that a few moments ago, so I shall not go over the same ground again; but, of course, there is one point which arises on the financial terms which have been suggested, and that is this. When the electricity scrip is given in exchange for the present stocks held by undertakings there will, if I have calculated the figures correctly, be a reduction, an economy for the State, of something like £4,750,000 per annum. That is the measure of the income which the present stockholders, unfortunately, are faced with losing. Assuming that the State does get that advantage, what is it going to amount to?. One thirty-second of a penny per unit. That is all we are going to profit (the users of electricity.

Then Clause 2 (4 b) is so wide that it would enable the Board to undertake any kind of activity in order to enable them to perform their functions or to make the best use of their assets. I do not know whether hon. Members realise it would even be possible for the Government to set up some electro-chemical industry using electricity throughout the 24 hours in order to keep, perhaps, some unused plant in a power station in constant operation. There is no mandate given to the Labour Party for embarking on any business of that kind.

There is one Clause to which I should like to refer, and I hope that the Parliamentary Secretary will give me his complete attention on this. It is Clause 13 (2, b,)which deals with holding companies. I doubt whether there is an hon. Member in this House who really understands the implications of this Clause. If a holding company had 75 per cent. of its securities invested in authorised electric supply undertakings, and none of those investments gave control over such authorised supply undertakings, then the holding company could, nevertheless, be taken over with its remaining 25 per cent. investments, no matter what the character of those investments might be. The absurd position is that the State will be taking over all the shares of the authorised undertakings in which the holding company had no controlling interest whatever. I cannot think that it is the intention of the Government to do anything so patently absurd. I want the Minister, to deal specifically with this point, and to make it clear beyond any doubt whatsoever what are the Government's intentions. I think that the Government's intention must be to ensure that the State shall acquire all the share capital of authorised undertakings, no matter how held, and it is not their intention to take over holding companies, unless the 75 per cent. electric supply investments of a holding company gives it control over the electric supply undertaking in which such investments are held. This is rather a complicated matter to put across, but it is a point of great importance, which certainly ought to be dealt with.

Yesterday, the Minister made an attack upon holding companies, and he mentioned one company of which I happen to be the deputy-chairman. I resented his remarks, and I wish to refer to two or three sentences he uttered. He said: There are many other ways in which holding companies could make undue profits in their transactions with their subsidiaries, the statutory undertakings. They could make excessive charges for purchasing materials, for technical advice or for raising capital It is difficult to obtain information on those charges, which are not necessarily shown separately in the accounts of the subsidiaries, but enough is known to justify uneasiness."—[OFFICIAL REPORT, 3rd February, 1947; Vol. 432, c. 1420.] In the next column, he refers to the company with which I am associated, the Southern Areas Electric Corporation. In 1936, which is 11 years ago, I put into the speech made by the chairman to the shareholders of this company these words: I would however, like to interpose here a general observation on the practice of your holding company qua our subsidiary undertakings. We give our subsidiaries every penny of advantage that we can secure for them. They pay only the net cost price as charged by contractors and suppliers, and there are passed on to them all discounts receivable from contractors and others. In short, all profits made by your holding company are derived solely from the dividends receivable from the subsidiary companies and I have thought it desirable to acquaint shareholders of this fact feeling sure that this policy will meet with your approval. If the Minister doubts what has been the practice since 1936, I have here and will show him a letter signed by the chartered accountants, one of the most eminent firms in the City, who audited the accounts of this holding company in all the intervening years, which will confirm the statement made in that speech. I ask the Parliamentary Secretary whether he will withdraw any implied imputation against me, or those associated with me, in the conduct of the affairs of this holding company.

I now come to a point about which I feel a little bitter. This arises out of' Clause 13 (13), under which every company is to disappear on the vesting date, as well as every director. No director is allowed to be appointed as the stockholders' representative, although the shareholders may have known him for 20 years and have implicit confidence in him. I think that a provision like that is a calculated insult to responsible and honourable men, and it is not in accordance with the true dignity of a British Parliament that such a provision should be contained in any Bill. I should also like to know why it is that the Electricity Commissioners are, apparently, to, disappear, and provision is made for their retirement. We, in the industry, have learned to appreciate the work which the Electricity Commissioners have done. They have done a great job, and we were hoping that they would be strengthened and allowed to go on with their good work. What is going to happen to the Central Electricity Board? They are apparently not dealt with in this Bill.

I apologise to the House for having been so long, but there is one question which I wish to put before I conclude. I am sorry that the Minister is not here, because this is a point which I must put to him personally, unless the Parliamentary Secretary can give me a satisfactory answer. My question is this: Did the Minister consult the Central Electricity Board on the drafting of this Bill? That is a very direct question, and I want an answer, "Yes" or "No." I hope that the Parliamentary Secretary will be able to give me a reply, but if he is unable to-do so then the Minister must be told of the question.

I do not usually use very strong words, but I feel compelled on this occasion to say this, after nearly half a century of experience in the working of this great industry. No argument advanced in support of this Bill shows the slightest justification for nationalising the industry, which is already so largely under public ownership and control, through the Central Board and the Electricity Commissioners, appointed by a Minister responsible to Parliament. No industry has been, or is today, more efficient, more progressive, or has spent so many millions of capital on its development. No other industry has had happier relations with its employees, and no other industry has given its customers such benefits in reduction of prices, in spite of the very heavy rise in costs. The Bill contains grossly unfair compensation proposals, which are described by some writers as mandated robbery.

This is no case of a poor bag of assets, but very much the reverse. There are no adequate safeguards in the Bill for consumers or employees. It contains provisions which are a studied insult to the honourable men who have devoted a lifetime of technical and administrative experience to creating and expanding a most efficient public service.

The power which the Bill seeks, to enable the State to embark on the manufacture of electrical plant and equipment, is undoubtedly ultra vires their mandate; It asks acceptance by this House of a plan which is utterly at variance with the expert advice contained in reports of Government committees. In short, the Government have made a faulty diagnosis of the indisposition of this industry, and quack remedies are prescribed by quack doctors. This Bill is not brought forward in the national interest, but purely to fulfil Socialist theories. Whatever test is applied to it it is a thoroughly bad Bill, and a far better and simpler Measure could have been brought in to remedy the admitted defects of the structure of the industry. All that I have said is a damning indictment against this Bill, which can be riddled through and through because of its technical and administrative defects.

I ask every Member of this House to put this question to himself: Which of us here would place a limit to the rapidity of the progress of atomic energy coming to the aid of industry and domestic use? The other night, on the wireless, a scientist stated that if the same thoughts were applied to the development of atomic energy as were applied to many things during the war, such as the Mulberry harbour and F.I.D.O., it would be a short time before the electric lamp would be lit by atomic energy. Who will say how rapid may be the development of this energy? If it comes within the next three or four years we may all look foolish in having agreed that the State should spend hundreds of millions of pounds in acquiring an industry, when much of the capital which has been acquired will be utterly wasted on the provision of such things as boiler houses and that side of the work of the production of current, because atomic energy would take its place. This is a big and solemn question that we have to face, and in all these circumstances anybody who votes for this Bill will be doing nothing to further the national in terest, but may do it irreparable harm.

5.53 P.m.

Mrs. Castle (Blackburn)

We have had a number of expert speeches during this Debate, and I have listened to them with great attention and mounting awe. I intervene in this select atmosphere today only because I am still trying to get an answer to one or two very simple questions about a problem which, I am afraid, even the most expert speakers have not enlightened me. I have great respect for the hon. Member for Stockport (Sir A. Gridley), and I signalised that respect by sitting all through his speech. But even he did not help me. Indeed, he ended on a note of remarkable confusion because his peroration was, I thought, the most damning indictment of the generosity of the compensation to be provided under this Bill. I hope his arguments may reach the Chancellor so that he may consider reducing the figure, because I have had a few qualms myself, realising that the unknown quantity of atomic energy was hanging over the whole scene, lest he may have been a little reckless with public money in proposing the present compensation terms in the Bill.

All this emboldens me to come forward with my one or two simple questions, and I want, in the beginning, in accordance with the traditions of this House, to declare my interest. I am a housewife. I run a home, and in it I use a considerable amount of electricity. I stand here today as one of those consumers to whose interests so much lip service has been paid, although I was rather summarily dismissed by the hon. Member for Stockport as being one of the domestic third whose complaints should hardly be listened to compared with the point of view of industrial users. I have as housewife, a very immediate and practical interest in this Bill. I think I can say that I represent the ordinary domestic consumer's attitude of mind and desire for clarification. I come here genuinely seeking enlightenment on how the Bill will affect me. That has been my whole objective during this Debate.

I am anxious to know the merits and demerits of the case presented by both sides. When this Bill was originally mooted I received a pamphlet. As it was called "To those with Open Minds," I was aware that it was particularly addressed to me. I have perused this pamphlet with all the honesty of intention of which I am capable. It is issued by the public relations committee of the electricity supply companies. I gather that my hon. Friend the Member for Bolton (Mr. J. Lewis) has also received one. As a matter of fact, I believe that so considerable are the sums being spent on the public relations work of these companies that he and I have not been exclusively honoured in this way. I sometimes wonder at which point the public relations officer—that anathema to some Members opposite—ceases to be a public relations officer when he is employed by private industry.

Three-quarters of this pamphlet give me a history of the whole thing. It is the sort of survey for which my right hon. Friend the Minister was attacked when he devoted a portion of his speech to it. On the last page but one of the pamphlet, we reach "The Problem." I am informed that the industry is fully aware that the present situation is not perfect in every respect. But, following this admission, we have a pledge that the industry will proceed to carry out a five year programme, which runs as follows:

1. "(1) To make electricity available to 95 per cent. of the premises in their areas.
1623
2. (2) To reduce prices to the lowest possible consistent with the cost of coal, wages and facilities.
3. (3) To standardise forms of tariff.
4. (4) To complete the standarisation of voltages.
5. (5) To complete the abolition of Direct, in favour of Alternating, current."

I am prepared to welcome that programme, although I must say, that in view of the many eulogies which the hon. Member for Stockport has expressed about the progress made by the electricity industry, it formed an imposing catalogue of existing deficiencies. However, I welcome it as a housewife who has experienced a number of these drawbacks in our present organisation of electricity supply. But I think I am entitled to ask two questions. First, why has all this not been done before, and, second, what new guarantee have we that it will be done in the future?

At this point, I am irresistibly reminded of other five-year plans which seem to have been floating about recently. I do not refer to the Soviet ones. Indeed the five year plans which have been produced by British private enterprise since the Labour Government's policy of nationalisation has been mooted, makes the State Planning Commission in Moscow look like a local branch of the Conservative Party. We have had a five year plan for the railways, a five year plan for rural electrification, and we should probably have had a five year plan from the coal owners, if my right hon. Friend had not broken in on their happy cogitations. It is said that the deathbed repentance of a condemned man is no real guide to the conduct he will pursue if he is reprieved. I am not quite so unkind as to say that. I do, however, ask why we have not had this development before, and what guarantee there is that, if the industry is left alone, we shall have these improvements in the future. At this point, I must correct the hon. Member for Stockport when he declared that the private companies had never suggested that no legislation was necessary. The document to which I have referred concludes as follows: There is no aspect of the reorganisation of electricity supply into more balanced and efficient groupings which cannot be carried out by the industry itself with more skill and speed, and at lower cost and with far less disruption than is possible for any mushroom Department of State. I want, therefore, to pursue this matter a little more closely. I think that we can only look for a guarantee for future redress if we know what the cause of our troubles has been in the past. So I continued my research, and in the McGowan Report, I found this: The present admitted lack of uniformity in systems of supply and voltages, tariffs and methods of charge, facilities for hire or hire-purchase of apparatus, assisted wiring, etc., is undoubtedly due primarily to the existence of such a large number of separate undertakings. We were told by the hon. Member for Stockport that Parliament is to blame for that. Presumably, therefore, Parliament should be called upon to put the matter right. Indeed, the McGowan Report clearly established the following: Past experience has demonstrated beyond question that any attempt to carry through on a voluntary basis a scheme of reorganisation on the general lines we have recommended would be bound to fail. This is not a Socialist document. That point was made earlier in the Debate and not challenged by hon. Members opposite. Presumably, therefore, we can agree, so far at any rate, on the analysis of the situation. In other words, we find that unless we have reorganisation, with a smaller number of undertakings, larger units, and wider planning we cannot hope to carry out the five year plan, whatever propaganda may be produced by the supply companies. We must also conclude from the McGowan Report that that reorganisation must take a compulsory form. At least, my right hon. Friend has produced his answer to that situation in this Bill. I am still waiting to know from hon. Members opposite what is their alternative?

Presumably the hon. Member for Stockport stands behind this document, and he says, "Leave it to the industry. Leave us as we have been in the past." But the McGowan Report demonstrates that voluntary action produces no results. What are the arguments that have been advanced against my right. hon. Friend's method of meeting this agreed situation. Point number one was made yesterday by the hon, and gallant Member for Pollok (Commander Galbraith), who said, and he has been echoed by others, that there is absolutely no proof that this Bill will cheapen costs in any way or produce the desired results. But I again refer hon. Gentlemen opposite to what the expert committee, to which they have called attention, says on this matter. The McGowan Report states: Substantial savings could be realised in all future development by planning on a wider scale. It is, of course, true that if other factors deteriorate, if, for example, coal costs rise:, electricity costs may rise also, but it is inescapable that if we are to get the rationalisation which will enable economies to be introduced, we must have larger areas of supply.

What is the second complaint of the hon. and gallant Gentleman? This is not the hour, this is not the moment—"The whole energies of the electricity industry should be devoted to increasing output."[HON. MEMBERS: "Hear, hear."] Perhaps the hon. Gentlemen who say, "Hear, hear," can clarify my dilemma, because this statement, to my simple and, I hope, not illogical mind, means one of two things: It either means that the hon. Gentleman disagrees with the five-year plan—the case on which private supply companies are trying to gain public support-—or he disagrees with the McGowan Report, which says that we will not get the basis on which any five-year plan can be carried out without compulsory reorganisation. What hon. Gentlemen opposite have to prove, and have not attempted to prove during this Debate, is what scheme of compulsory reorganisation they are prepared to advocate to meet this situation and how much less disruption their compulsory scheme would cause compared with the nationalisation proposals. From my reasoning of this situation all this talk of improving conditions for domestic consumers, of extending standardisation and uniformity, of ironing out those diversities which bedevil the domestic position, is mere propaganda, unless it is based upon some scheme of reorganisation, the details of which we still wait to hear from hon. Members opposite.

I think that it was a bit cool of the right hon. Member for Southport (Mr. R. S. Hudson) to criticise my right hon. Friend's speech as inadequate. We were told that the scheme which he worked out in detail for meeting this situation is inadequate. If this scheme is not the one, what is the scheme? I see the right hon. Gentleman is not to be lured into the danger of stating a policy which might create so much controversy outside that all this talk of nationalisation causing disruption would seem nonsense. I realise that if I want to go with an innocent, open mind in search of information, I had better not go to the right hon. Member for Southport. He is so good at developing negatives that he is probably in the wrong profession. I read very carefully in the cold morning light of today the speech which he delivered yesterday and I find that there are other points on which he has rather unfortunately misled the House. Of course, it may not be his fault. Sometimes we are not adequately briefed on these occasions. There is one point on which I should like to clear the mind of the House, because it has been beclouded by the right hon. Gentleman. During the course of the speech, pointing an accusing finger at my right hon. Friend, he said this: What he did not tell the House—and it is significant of his methods of argument—is that a committee to go into this matter"— that is the diversity of charges today— was set up, and set up by whom? It was set up by the Central Electricity Board. At the instance of the Minister, the Board of Trade or the consumer? No, it was set up at the instance of the companies concerned."—[OFFICIAL REPORT, 3rd February, 1947; Vol. 432, c. 1426–7.] Of course, as the House will be well aware, the Central Electricity Board could hardly set up such a Committee, because it is not competent to do so, and it is not even within its functions. The Committee was, of course, set up by the Electricity Commissioners, and I should be glad to take any opportunity of telling the right hon. Gentleman privately what is the difference between the Electricity Commissioners and the Electricity Board. One point is quite obvious, the Electricity Commissioners have no powers of compulsion. Therefore, all these signs of activity—I am prepared to accept that this may have been done at the request of the companies as one of those last minute activities—are intended to show that everything in the garden is perfectly lovely if only the Labour Government will not press ahead with their distracting and disruptive activity. This is the second attempt to clarify this question of charges on a voluntary basis, but without compulsion I am afraid I see no reason to accept the view that its result will be any different from that of the first attempt.

I must say that the passionate interest taken by private enterprise in the interests of the consumer as soon as the Government propose to do something to remedy the injustices done to the consumers reminds me irresistibly of the story of the man who never kissed his wife for five years and then shot the first fellow who did. I declared my interest at the beginning. I am here as a simple housewife, representing ordinary women who run the home, and there are three things in which the housewife is interested. She is interested, first, in seeing that the scope of electrification of the home is greatly expanded in the future; she is interested, secondly, in better services now; and she is interested, thirdly, in the democratisation of electricity. She wants to see it cease being a middle class privilege and become a privilege available to every home.

It is not denied by anyone that the technical development of the electricity industry has been remarkable in recent years, but I believe that it is owing to a lack of administrative flair inside the industry that this has not been reflected to any adequate degree in improvements or extensions of the services. Technical efficiency is not only a factor which is necessary for the development of services on an imaginative scale; administrative ability is needed, too, and in that respect the electricity industry in the past has not particularly distinguished itself. With regard to the first point of more facilities, we need a very great deal more imagination in this field. It is absolutely imperative that we should realise that we are at the end of the era of cheap labour, the end of the era when under the misrule of, hon. Gentlemen opposite labour was the commodity that was least prized and least conserved. We have reached the end of that era as far as industry is concerned, and we have got to, reach it as far as domestic labour is concerned, because the time, labour, health, happiness and energy of the housewife is of vital importance in the future development of this country, and particularly in the years ahead.

Electricity can be made to do a great many more things in the home than it has been allowed to do. Not only can it heat the water and the rooms, but it can wash dishes and launder the clothes, peel the potatoes, clean the silver and do the hundred and one odd jobs which are the unavoidable necessity of female life. A utility motor on, the kitchen wall will help the housewife with all these jobs. These are not merely the dreams of Hollywood homesteads; they are in operation in Scandinavian countries today, and they are not remote to those who believe in civilised living and in the possibilities which electricity can achieve in that direction. That is for the future, but I believe that through this Bill we shall have an opportunity of going ahead in a really imaginative way. There are more immediate needs in the way of service and improvement. It is absolutely intolerable that at this late hour of our national development there should be such confusion and such diversity in the provision of ordinary services in the home. The housewife must have complete mobility of all her electrical equipment, whether motor driven or any other form of electrical equipment. Despite the great advances to which the hon. Gentleman the Member for Stockport referred, that is not the situation today.

In 1936 P.E.P. examined this situation in some detail and in its Report it found that of the undertakings then in operation although 84 per cent. had assisted wiring schemes, 25 per cent. were without showrooms or hiring schemes and 20 per cent. had no hire purchase schemes. There has been some development since, but certainly not sufficient to eliminate those glaring inadequacies. At the moment, a housewife living in West Ham can hire a washing machine or a refrigerator from the electricity authority, but if she moves into another area like Hampshire she will live in the dark ages where she will have to carry all the burdens of the home without the assistance of electricity in any imaginative way.

I want to suggest to the Parliamentary Secretary to the Minister of Fuel and Power that there is one immediate improvement that can and must be introduced and to which I see no reference in the Bill. We urgently need the establishment of an official testing station for all electrical equipment. I believe that one is in operation in Holland today, and I am surprised that an industry that has made ail these rapid and dramatic strides has not taken as a voluntary step within the industry this effort to set up a testing station for the purpose of safeguarding the reputation of the whole of the industry, particularly of the manufacturing side. It is common knowledge today that injuries are being caused in the home to children and others by burns arising from the use of utterly unsafe equipment, such as fires, water heaters and irons, which is a scandal to the whole industry. At the present time there is no legal means of stopping it and there has been no voluntary effort by the industry itself to rectify this matter. That is one immediate amelioration under State enterprise that we could introduce.

One final point. We must realise that the blessings of electricity are at the moment confined in any imaginative sense to the middle class, and the only way in which we shall extend them into working class homes is by the most ruthless standardisation. I thought that the right hon. Gentleman the Member for South-port once again revealed how completely he is out of touch with the realities of the situation when he airily dismissed the need for standardisation by saying: There is something to be said for standardising the size of plugs, and things like that, though I am not altogether sure that the housewife and the ordinary purchaser will be awfully pleased when given nothing but a series of austerity models."—[OFFICIAL REPORT, 3rd February, 1947; Vol. 432, C. 1427.] I do not know whether he was referring to austerity models of plugs or to rather more elaborate equipment, but the attitude of mind which he showed was a purely middle class one. Standardisation alone has brought refrigeration within the scope of working-class folk. Thanks to the efforts made by the Government to secure and encourage the development of a standardised refrigerator which is now going into all Government-sponsored, prefabricated homes, working-class housewives are seeing that amenity coming into their houses for the first time, and we need an extension of these amenities on the basis of standardisation. I am glad, therefore, that the Minister has taken powers to manufacture equipment if he considers it necessary, because it is a remarkable thing, which we have experienced on more than one occasion, that only when there is the threat of State enterprise going into a certain field does private enterprise really pull up its socks and begin to offer some of the service it should have been offering of its own initiative.

It has been rightly said that the establishment of the grid won the war, and that without it we could not have survived. In my opinion this Bill, with the possibilities it presents of a sound basis for going forward with the electrification of the home, the setting free of vast resources of women power in this country, and the saving of human energy and prevention of ill health, can be a most important factor in winning the peace.

6.22 p.m.

Lieut.-Colonel Elliot (Scottish Universities)

I am emboldened by the incursion into the Debate of the hon. Lady the junior Member for Blackburn (Mrs. Castle) to enter it myself being, like her, merely a lay man, or should one say a lay woman, not acquainted with the enormous array of technicalities with which the House has had to deal, in a great proportion of the review of this Bill. I am all the more emboldened since, after the very thorough review of the Minister's speech by my right hon. Friend the Member for Southport (Mr. R. S. Hudson), all that the hon. Lady could find to object to in it was that he had said "the Central Electricity Board" instead of "the Electricity Commissioners." If that was all that was wrong with his speech, it was not such a bad one.

Mrs. Castle

I do not know whether the right hon. and gallant Gentleman was in the Chamber when I said that it was a totally inadequate case which showed no alternative policy at all to that proposed by the Government.

Lieut.-Colonel Elliot

I am hurt and astonished that the hon. Lady did not see that I paid the compliment which she paid my right hon. Friend the Member for Southport of sitting throughout all her speech and listening to it most attentively, because I have a great admiration for her powers as a debater. It was only last week that we found ourselves on the same platform pressing, upon the Government a reform about which they had showed themselves singularly coy, and I grasped the truth of the epigram of a friend of mine which I think showed out through the whole of her speech—that women have a very poor grasp of excuses. The difficulty in which we are placed is that, so many times, hon. Members opposite seem to think that although a thing is bad, it will be all right if a Minister is put in sole charge. I do not think that is a self-evident proposition, and I certainly do not think it is a proposition which applies to this industry.

Two lines of argument have stood out very clearly in our two days' Debate, and I do not think we shall get them much closer together. In fact it is only experiment and trial which will bring a solution to them because they are so sharply opposed. They are the lines of those who desire centralisation as against those who believe that, in spite of its disadvantages, decentralisation is, in fact, the line along which this industry, has made great progress and along which it can yet make more rapid progress than by the centralised or so called "streamlined" method presented in the Bill. Is its working wear to be the pullover of private enterprise—admittedly an untidy garment—or the strait-jacket, which although streamlined is not the very best working wear? I do beg hon. Members opposite to grant first of all that we are in an interesting position here because we can debate this subject without having it bedevilled by the continual introduction of the words, "the profit motive." This is an industry of which 60 per cent. is already held under public management of one kind or another, which means that the matter of centralisation or decentralisation' can be discussed apart from the question as to whether the profit motive should or should not be eradicated from the process of the supply of electricity.

The difficulty in which we are placed is that hon. and right hon. Gentlemen opposite have made their reputation, and have worked their way up on these great public bodies, from whom it is now proposed to remove these tasks completely. The ironing out of diversities and the standardisation of voltage may be worthy objects. It may be a very good thing to bring our standardised voltage down to 240, but, after all, the development of the industry was pioneer work. Does anybody believe that a quarter or half a century ago an agreement could have been reached on a standard voltage, or, if it had been reached at that time, that it would have been right? Only last week we were debating the Town and Country Planning Bill.

I remember some years ago visiting a planned town—the great city of Buenos Aires. It had been planned a consider- able number of years before and all the streets were of a uniform width. But that width was too narrow, and now there is no way in which the city can be improved unless the whole town is pulled down from one end to the other. There is that danger in standardisation; you may standardise prematurely. The danger of our impatient friends is that they produce a demand for standardisation in a growing industry which, it may well be, is not the best way to tackle the problems which lay before it. In particular, I would say that in my view the destruction of the great municipal undertakings is a retrograde and not a progressive step.

After all, such great undertakings as that of the city of Leeds, which has raised for its electricity undertaking £10½ million, Manchester £16⅓ million and Birmingham £23½ million, are the work of committees upon which people from humble origin and homes have learnt the technique of management of great businesses and from which hon. and right hon. Gentlemen learnt to rule. Tonight they say, "Cast that all aside. Nobody else is to have the chance. In the future these things will be done by bodies nominated by a Minister." Nomination by a Minister is no substitute for popular election and the growth of knowledge over many years. If we had removed from the County Hall across the river, and its predecessor, all the great undertakings which under this administration it is proposed to remove from them, should we have had that powerful comprehensive grasp which the Lord President of the Council so admirably applies to the business of the day? They kick away the ladder by which they have climbed and say, "We have got to the position in which we have by the process of popular election and managing these great municipal undertakings, but we remove from our successors any chance of following our footsteps." That was not the view of the Prime Minister when the matter was discussed on a previous occasion, and it was certainly not the view of the municipalities until the day before yesterday.

What then does their argument turn upon? It turns upon the companies. The companies are attacked on the assumption that under the Ministry everything will be very much better. The Treasury will come in and that will make a great difference. It will loosen things up, thaw the long frost which has overhung the in- dustry for many years and free the channels choked up to now by the repressive measures of the great town councils or the great power companies. I have been a Minister for many years, and I assure hon. and right hon. Gentlemen opposite and I beg the hon. Lady the Member for Blackburn to take it from me that the Treasury is not all that good fairy when it really gets down to its work. What has it to provide? Capital? But the industry has had no difficulty in raising capital. Is it to find plant, material and men? That is not its province. There is only one perfectly definite evidence that will remain that the Treasury has been there, and that is loot. The Treasury is about to help itself to the reserves and to 30 per cent. odd of the revenues of the present undertakings. The Treasury says, "You will be surprised to see what we will do with it when we get it." So they will, too. On this point it is interesting to note that all the people who are being approached are complaining. The private companies are complaining, and the local authorities, too, complain bitterly.

The great city of Glasgow has been mentioned. Nobody could say that the great city and town council of Glasgow was a Tory stronghold. Nobody could say that it would not look with the utmost favour on a Measure introduced by Labour Ministers, particularly a Labour Minister who for some time held the honourable position of a town councillor in that great city. What are the views of the town council of Glasgow about compensation? It would make the companies' mouths water till they drooled down their beards. They said that the Glasgow undertaking, instead of being taken over with compensation of £2,340,000, should be paid compensation of £12,400,000—from £2,000,000 to £12,000,000, six times as much. The hon. Member for Stockport (Sir A. Gridley) would fall back aghast and appalled at a multiplication to anything like that of the modest figure for compensation which, he suggested. But I am not surprised. I was looking up some of the figures. The city of Glasgow, which borrowed £11,670,000, has repaid nearly £9,000,000 and is left with a debt of £2,870,000. That is the Socialist city of Glasgow. The Tory city of Birmingham—

Major Cecil Poole (Lichfield)

Since when?

Lieut.-Colonel Elliot

It was the Tory city of Birmingham during the time it was borrowing all this money. It has borrowed £24,238,000 and has repaid £8,600,000, and the debt remaining which the Minister of Fuel and Power is going to take over is £13,570,000. I can assure hon. and right hon. Members opposite and the hon. Member for Dumbarton Burghs (Mr. Kirkwood), who was a town councillor for Glasgow for many years, that Labour Members will have a pretty stiff task to explain to the people of Glasgow why the Tory city of Birmingham is getting away with £13,500,000 and Glasgow only a little over £2,750,000.

However, the proposed compensation, it is said, will do great things for the shareholders. It will give them security—a far better security than they have now. All they have now is dynamo boiler plant. They will get Dalton bonds instead. Does anybody out of a madhouse suggest that a Dalton 2½ per cent. bond is a better security than an electrical plant in full working order? Because if there is any such person and he has an electricity plant for sale, let him come to me, and I will take all the electricity plant he likes to give and I will produce paper for him in wonderful streams. Let me get away with an electricity plant—I do not care how much paper I give, especially when I see the latest antics and speeches of the Chancellor of the Exchequer. It is interesting to note how his subconscious mind reveals itself when attacking the argument that it is unfair to take over shares at a certain valuation. He quoted the instance of a stockbroker. That is the sort of thing that is running in his mind. He might be called a giant stockbroker. The Chancellor of the Exchequer is not really engaged in finance at all, but in gigantic stockbroking activities just now and, naturally, his ideal is a stockbroker. When he speaks of a stockbroker dying after a long and not un-remunerative life, he is speaking of his ideal figure. But that is different from the great group of productive enterprises in this country, which are being dispossessed and centralised under the technique which is brought before us today.

The speeches tonight have been full, and I have no chance to spend the time I should like to spend on analysing a little more closely the remarkable financial operations and the remarkable arguments used to justify them, but I hope there will be a chance of discussing them at some length at a later stage. However, I say again that the fundamental theory of the whole transaction that one increases a man's security by taking away a piece of real property and handing over a piece of paper, under the depreciatory powers of the present Chancellor of the Exchequer, is not the sort of contention that could be sustained in any series of reasonable arguments, and certainly before any arbitration tribunal. A further argument which has been put forward strongly by the hon. Lady, for which I have the greatest sympathy, was that we must improve the position of consumers, that electricity must be cheap and put into every home. I think we should all agree with that.

I was looking up the figures for the area of the country which I know best, the Clyde Valley. I found the great city of Glasgow and the Tyne Valley Company cheek by jowl. In the year ended May, 1946, the cost per unit in Glasgow city was.827d. per unit and the cost in the Clyde Valley was.839d. per unit—.012 of a penny difference. We must admit that the City of Glasgow enterprise, not conducted for private profit but by a go-ahead municipality, which has been praised by no less an authority than Mr. George Bernard Shaw—although, of course, he praised it in its Tory days before it got round to its present Labour majority—is doing the best it can, and making current and devices available at the cheapest possible rate. Yet all it can show with this close-packed, remunerative area, with every wire as it leaves one house passing into the next house, is.012 of a penny in favour of the City as against the undertaking covering the countryside, and all the extensions and unremunerative work which the countryside involves. No, I really do not think this argument holds water.

Finally, it is said, "Well, it ought to be done. At some time or other it has to be done, and why not now?" To which the argument has been advanced from this side, "But this will involve dislocation at a time when undoubtedly we should avoid everything tending to any kind of dislocation of our industrial effort." The Minister laughed that off. The Minister is one of the best laughers on the Front Bench—except, of course, the Chancellor of the Exchequer, who is its king humorist, although his jokes are not as funny to other people as they are to him; but they are very funny. Everyone quotes the McGowan Report. Why only the McGowan Report? Why not the Report which was asked for from a committee appointed by a Socialist Secretary of State, reporting to a Socialist Secretary of State, at a much later date than the McGowan Report, and with good Socialists upon it such as Neil Beaton, who is well known, at any rate to all the Scottish Members, as no Tory die-hard. What was the verdict of Neil Beaton, reporting to Tom Johnston in the year 1942? He said: We have examined the different aspects of the problem…Theoretically, there would be a superficial attractiveness in a complete reorganisation of the entire Northern Area under a scheme by which all the existing undertakings, whether belonging to companies or to local authorities, would be acquired and merged in a public corporation with new and wide powers…we do not recommend so drastic a proposal—the obstacles to which in our view substantially outweigh the theoretical advantages which would be secured. Such a scheme could not be carried into effect without very serious and needless dislocation of electricity supply, and we are not satisfied that the consumers would derive any compensating benefits. That is what Neil Beaton said to Tom Johnston in 1942, and it is impossible to laugh that off as simply the maunderings of an effete capitalism. It would be astonishing if it did not cause some dislocation. I was looking at what would happen. The new electricity law will not be complete until the Minister has made 24 sets of Regulations under the Bill, until he has examined 500 Provisional and Special Orders, and over 200 special Acts to discover whether their provisions are inconsistent with, or rendered redundant by the new Act, and until the Minister, by Order, repeals, amends or extends any of the above-mentioned 700 statutory enactments so as to obtain a uniform statutory code. If that is not to cause a certain amount of dislocation then it is a miracle because, in addition, the present legislation comprises 14 public general Acts. No attempt is made to codify this legislation.

If hon. Members examine the Second and Third Schedules, they will find that this legislation has simply been assassinated—that is the only word for it. Six Acts are completely repealed, and out of the 270 remaining Sections and Schedules, 166 are repealed. Of the 104 remaining Sections of the Code, the Second Schedule amends in a pretty complicated way no fewer than 73 of them. And we are told that this is not to cause any dislocation. It may not, because some ingenious devices are provided: Section 6 of the Electric Lighting Act is repealed. By the way, it is the Section under which Regulations are made for the safety of the public. Then, having repealed that Section, Clause 52 states that, notwithstanding the repeal, the present Regulations are to remain in force until the Minister can think of some further Regulations. He might go through the whole Statute Book on that basis. The consumer is left completely in the air because all the Sections dealing with charges for supply to consumers, maximum prices, power to call for revision, the power to make charges by agreement—all these are repealed. Nothing is put in their place. What is retained? Those powers one would expect from something with which the Treasury is pretty closely concerned-all the Sections which put obligations on the consumer, the Section requiring a guarantee of certain financial return, and the Section demanding proper notice from the consumer. All the Sections, in fact, which the industry has been most severely criticised for applying are retained; the ones repealed are the ones that protect the consumer.

For the purpose of.012 of a penny, it seems a pretty big upheaval. One must remember that when the Board has been set up, when it has bought its castle, when it has attained that select category of those entitled to inhabit the stately homes of England, which is confined to Borstal boys, mentally deficients, and members of the Coal Board—then its troubles begin. Some pretty rough things are to be done when it gets into the saddle. A good deal of comment has been made on the way legislation treats directors, but it is nothing to the way in which it treats employees. For 80 years, covenants of every kind have been established in this industry to protect the position of the employee. These are repealed, and wide powers are taken over the person of the employee to which I beg the attention more particularly of the hon. Member—I may call him my hon. Friend the Member for Dumbarton Burghs, who has in his time protested pretty severely about transfer of labour, and being moved about by Government Departments in ways to which he, himself, had not previously given his consent.

The Electricity Supply Acts of 1919, 1922, 1926, 1928 and 1933, all provide compensation rights for the electricity worker. He was entitled to be compensated if the transfer or other events harmed him in any way; if he lost his employment, if his awards or emoluments were reduced, or his conditions of service made worse; also, if he himself gave up his job—which is quite a sound trade union reason—because he was required to do work "not analogous to his previous duties." He was entitled to have his claim heard in an industrial court by an impartial referee, or a board of referees appointed by another Minister, not the Minister who was being accused under the Bill. He was entitled to call witnesses, to be represented by counsel or solicitor, and, if he proved the facts on which a claim could be based "there shall be paid" say the Acts "such compensation as the referee thinks just." The Minister asks this House, this night, to abolish those rights. This Bill is to repeal all those provisions. An hon. Member of the Liberal Party was saying yesterday that they were about to support this Bill. Do they stand for that? We are entitled to ask. The work of many former Liberals is being repealed. The voice or at least the vote of the Liberals should make itself evident. It is a very difficult thing to detect those intentions. They can however be identified in the Bill. What is more, the Minister goes further. Under Clause 13, to which reference has already been made, he asks this House to say that employees, who are transferred by the Bill without their consent, shall have their service contracts so altered as to require them to render any reasonable comparable services under the appropriate board, to be selected by that board. That is not a power which this House would give to any employer. The board is to judge what is comparable, and no right of appeal seems to lie against the board's selection. These are strong measures which it is necessary for this House to swallow to save.012 of a penny. I am not at all sure that the savings justify the sacrifice this House is being asked to make even in the civil liberties of the subject.

As Minister of Health, I well remember having to direct the movement of several thousands of employees of the Ministry of Health as a war measure under the threat of the blitz. They were men and women who were running the great pensions machine of this country and who had millions of payments to make. We had to move them out of the range of the blitz from London to Blackpool. I still remember the feeling of horror and disgust that came over me at the power, which one man could exercise; to take a man from his house, leaving his garden derelict, and to break up a family by moving the employment without which the man or woman could not continue his or her economic life. The great Hollerwitz calculating machines were moved. The men had to follow them. They went on a promise that they would be brought back. A week ago, I heard the hon. Member for Rugby (Mr. W. J. Brown) upbraiding the Minister; another Pharaoh had arisen who knew not Joseph. Some new figure had appeared to whom that pledge could not be applied, or by whom it could be interpreted in another sense. That was a war measure, and only as a war measure could it be defended. Under this Measure we are asked to make that a permanent power of any Minister of Fuel and Power. We are being asked to do too much, even in the name of efficiency. There are even greater things than the efficiencies we expect to secure under this Bill. Those greater things are threatened tonight. I ask the House to refuse to give these powers into the hands of the Minister.

6.55 p.m.

Mr. Turner-Samuels (Gloucester)

I am quite sure that everyone in this House admires the verbal dexterity of the right hon. and gallant Member for the Scottish Universities (Lieut.-Colonel Elliot), but some of us who listened very carefully to the robust speech he made, felt rather sorry that he should have employed his great talents in order to endow this discussion with the cheap points he made. All the right hon. Gentleman did was to show his skill in employing his power of badinage. There was not a single argument put forward by him which disposed of the necessity or effectiveness of the Bill as printed and presented by the Minister. The right hon. and gallant Gentleman and his colleagues put themselves forward as defenders of local authorities, amongst other things. Does he really ask us, who have been in political life for over a quarter of a century and have seen the devastation private enterprise has brought upon industry and the life of the nation, to believe that he or his colleagues care two straws about local authorities? What they are concerned about, and the only thing they are concerned about, is the continuation in industry of private enterprise and profit. That is the difficulty in which he and his friends find themselves.

Mr. Pickthorn

On a point of Order. Since the hon. and learned Member for Gloucester (Mr. Turner-Samuels) seems to be making this the basis of his argument, may I ask your guidance, Mr. Speaker? Is it in Order to attribute motives, and to say that hon. Members who have asserted constitutional principles are really concerned with nothing but profit?

Mr. Speaker

Actually, of course, if one attacked an individual and said that that was his motive, that would be out of Order. But, generally speaking, one attacks all parties, one way or the other, and one can apply motives to them in that general sense. That is not out of Order. As time is getting rather short I hope we can get down to the point without these generalisations.

Mr. Turner-Samuels

I was just saying that the difficulty in which the right hon. and gallant Gentleman and his colleagues find themselves is that they either own these private interests with which this Debate is concerned, or they represent them, and if they do neither, they are always supporters of vested interests. The one thing this Bill will do now and do permanently is to dispose of those vested interests and put them under public ownership. I do not want to go into the metaphysical gibberish to which the House listened from the senior Burgess for Cambridge University (Mr. Pickthorn), but he dealt with a point on Clause 10 with which I also desire to deal. I ask the House to assess the value of his speech by what he said on this particular point. His reference to Clause 10 was about something for which that Clause gives no foundation whatever; neither does any other Clause in this Bill give it. He represented to the House that, for the first time, this Bill prevents the right to present a petition to Parliament. The Bill does nothing of the sort. Clause 10 makes absolutely no reference to any such thing. It envisages no such purpose. Like the gallant advocate that he is, when I taxed the hon. Member with this inaccuracy he fell into evasive retreat and refused to be drawn.

Mr. Pickthorn

If the hon. and learned Member will read the Clause he will sec that it says that, without the consent of the Minister, certain corporate bodies are not to be allowed to promote or oppose legislation. I do not think that I said categorically that that was absolutely unprecedented, but I said that I thought it was highly improper and unusual, and I read in support Erskine May's opinion that the right of every entity under His Majesty's Government to petition the House of Commons, is an old and fundamental part of the Constitution.

Mr. Turner-Samuels

The hon. Gentleman, having been completely caught out, is now hedging. I am quite familiar with that Clause, in contradistinction to the hon. Member. The Clause merely deals with Bills being presented to Parliament. It has no concern with, nor does it make any reference to, petitions to Parliament. He may try to persuade the House to the contrary, but he will not succeed.

I listened to the speech of the right hon. Member for Southport (Mr. R. S. Hudson) with great interest and respect. I think he was anxious to deal quite fairly with what he thought was in the Bill, but as so often happens, he was quite obviously speaking from a misleading brief, because what he tried to lead the House to believe was that the whole of our legal system was going to lie in pieces, under the devastating effect of the provisions of this Bill. I do not think it is putting it too high to say that he asserted that things could be done under this Bill which were never capable of being done before, which were contrary to all natural rights and justice, and which were contrary to all previously existing law. I will take one or two of the instances he gave. First he said that by Clause 5 of this Bill the courts and Parliament are superseded, and arbitrary powers conferred on the Minister. He made that definite allegation. If it were true, it would be a serious allegation indeed. He went on to say that there was no relief that could be afforded by the courts if the power of the Minister was so exercised that it exceeded what was in the Bill That is absolutely wrong and a misrepresentation, quite unintentional, no doubt, of what the law is. It was laid down explicitly in the House of Lords in 1931 that if any directions or powers of this description which are conferred upon any Minister or given by any statute, are so exercised as to exceed the power vested in the Minister the court has power, not only to intercede but to give the proper relief. Therefore the right hon. Gentleman's contention on this head was quite erroneous.

Moreover, there is a further safeguard, an important one. These powers have to be exercised reasonably and in a bona-fide way. In exercising them, the Minister has to have strict regard to the objects of the Bill or the statute which confers these powers upon him. Although a reference was made by the right hon. Gentleman to Clause 5, he omitted to mention Clause I (6) which defines the objects of this Bill, and in that way limits Clause 5 so far as these particular powers of the Minister are concerned. Therefore, it is quite incorrect to say that all control will have gone, either from Parliament or from the courts, to the Minister. Of course, it is perfectly true that these powers are not conferred upon Parliament in the Bill, they are conferred by Parliament upon the Minister, because Parliament cannot administer electricity; it is the Ministry that is to do so. There fore, it is essential for that purpose, to give the powers to the Ministry. It would be absolutely ludicrous to talk about giving these powers to Parliament. There is enough complication here already. If matters are even taken upstairs to be dealt with in Committee there are protests from the other side. This House may be very jealous that everything should come before Parliament, but the idea that Parliament can administer electricity as an industry is absolutely ludicrous.

There was a complaint that the Minister has almost licentious powers to eliminate the whole of local and public Acts in connection with electricity. That is an exaggeration; there are two important modifications. First, he can deal only with local or public Acts which directly effect electricity. He can deal only with those in order to get a uniform code, and it is perfectly clear to any lawyer who scans the Measure before the House that what is being sought to be done here is codification. It is all very well for the right hon. and gallant Gentleman the Member for the Scottish Universities sneering at this and throwing sarcasms at it, but if this matter is reasonably discussed and interpreted, it will be seen from the Clauses that this is a codification. All that is to be done with the other applicable local Acts or public Acts is to coordinate them, to approximate them to the provisions that are in this Bill, and the power given is clearly limited to that desirable purpose. The only modification of that is that the Bill does not say that that is to be done at once; it leaves it to the discretion of the Minister to do it either all at once, if he thinks it necessary, or in stages as it becomes necessary. Therefore, these provisions are strictly limited to the provisions of Clause 50, (1) to (4) in that respect. It is in order to get a uniform statutory code.

I would like to refer to a further matter which the right hon. Gentleman raised. He complained that the Minister has a right, under Clause 15, to disclaim agreements. That is a serious power to confer upon anyone, but it is not the first time a power of disclaimer has been given. A trustee in bankruptcy has a power of disclaimer, liquidators of companies have a power of disclaimer when there is property which they do not want to take over. The point has to be noted that this power of disclaimer given by the Bill does not apply universally to all agreements. The Bill describes specifically the type of agreement that can be disclaimed. Such agreements are, first of all, unnecessary agreements, agreements which ought never to have been entered into, or imprudent agreements. The right hon. Gentleman the Member for Southport then went on to say that there was in this instance no redress. If that were so it would certainly be a very serious matter.

As a matter of fact, his view is not correct. There is redress. The very provision which he was discussing and condemning provides machinery in these cases for arbitration. It says, most explicitly that, in the case where an agreement is disclaimed, the party against whom the disclaimer is made may take the matter to arbitration. There is one exception and that is where it is an agreement in regard to personal services. I ask the Minister to look at that again. [HON. MEMBERS: "Hear, hear."] Certainly—that part of it. That is an entirely different matter to saying that no redress applies to the whole of the provision. I do not know, but it may well be that the Minister may have a very good reason for excluding agreements relating to personal services. That matter may be more justified than appears on the surface, but I ask him to look at that part of the Clause again. Apart from that, in my submission, the power to disclaim agreements is absolutely unexceptional.

The question has been raised of the liability of directors. The right hon. Gentleman the Member for Southport somehow or other got it into his mind that the phrase, "shall be liable," was some extraordinary phrase which had never been used in Statutes before. If he cares to look at the Companies Act of 1929, he will see this phrase strewn all over it, not only in connection with civil affairs but also in regard to criminal matters. In any case, the liability in question here applies to a company paying excessive dividends, or making excessive payments, other than those permitted by the Act, after the directors have received notice that they ought not to do it. It seems perfectly right and proper in the public interest that this safeguarding provision ought to be made. It is said that that liability is there, without any right of appeal. Of course, that would be a monstrous thing if it were, true. It is a monstrous thing to say, because it is not true.

The Clause expressly and explicitly provides for arbitration in that respect. Any director who is charged with that liability can say, "No, I am not liable. I am not going to pay," and he is entitled to go to arbitration. A word in regard to what the right hon. Member for Southport said about criminal matters. Objection has been taken to this aspect of the Bill. It has been said that, normally, the onus of proof, is on the prosecution. I quite agree. Normally, the onus of proof ought to be on the prosecution. However, the Clause that is here under examination is Clause 54. That was referred to by the right hon. Gentleman without considering the preceding Clause 53. If those two Clauses are read together, the position becomes clear at once. Clause 53 applies to the case of the making by a director of a false statement. Where we have a false statement there is no difficulty as to any question of onus applying. The offence would have to be proved in a case where there is a body corporate which is liable for an act of that kind. That body corporate can be liable in such a case only through 3 servant or agent. The offence in such a case would have to be proved before a director or a servant or agent could be made liable.

The right hon. Gentleman the Member for Southport referred to and criticised other legal aspects, without any foundation whatever for his criticisms. His main attack on this Bill was in fact based upon these legal matters and, as those completely fail and fall to the ground, I ask the House to vote for the Second Reading of this Bill, which is a good and necessary Measure.

8.15 p.m.

Major Peter Roberts (Sheffield, Ecclesall)

In the absence of the Law Officers of the Crown we are grateful to the hon. and learned Member for Gloucester (Mr. Turner-Samuels) for giving us his opinions. However, he started his speech with so much prejudice that anything he said afterwards carried very little weight as far as I was concerned. The shortcomings of this industry have been ventilated from both sides of the House. We are getting rather familiar in these nationalisation Debates with supporters of the Government running down the great industries of this country one after the other. I suggest that no evidence has been produced by any speaker, and I have listened to practically all of them, to show that the benefits which they axe seeking must necessarily be obtained by a change of ownership. That is a point to which I hope the Parliamentary Secretary will refer when he replies.

In the speech of the Minister, I thought his only argument on that score was an anti-profit one. In one sentence he referred to "manipulation," "lining the pockets," "undesirable profits" and "excessive charges." If in point of fact he is attacking the making of profits, whatever the industry may be, then he should come out in the open and say so. In connection with this Bill as it is framed, I feel it is unnecessary to have a change of ownership. Many hon. Gentlemen opposite have suggested that there should have been some alternative put forward by hon. Members on this side of the House. [HON. MEMBERS: "Hear hear."] I hope hon. Gentlemen opposite listened to the very good speech by my hon. Friend the Member for Southern Dorset (Viscount Hinching-brooke) last night. I admit that the speech was made rather late in the Debate, approaching 11 o'clock. Nevertheless, if hon. Members read that speech they will see that some very constructive ideas were put forward. Therefore, in the main issue, I put it to the House that no proper argument has yet been advanced why the taxpayers of this country should be asked to pay something approaching £2,000 million in order to effect the nationalisation we are endeavouring to obtain.

I want to address myself to two aspects of this case. The first is the municipal aspect, particularly that of Sheffield. Also, I want to take further some of the good remarks which were made by the right hon. and gallant Gentleman the Member for the Scottish Universities (Lieut.-Colonel Elliot). To take the position of Sheffield, I want' to ask the Parliamentary Secretary whether there is any suggestion of criticism of the way in which Sheffield has been running its electricity undertaking. Do hon. Members opposite suggest that the municipal organisation in Sheffield has been badly and inefficiently run? If they do, I suggest that they should say so and then we would know where we stand. If not, what are the advantages which this Bill proposes to give to Sheffield as a city?

I can see pienty of disadvantages, and I am not alone in that. The Socialist chairman of the City Finance Committee was reported in the "Sheffield Telegraph" as showing dissatisfaction about the way in which local authorities are being penalised. I must agree with that. For 20 years the City of Sheffield have been paying off the debt which they incurred at the beginning. They have reduced that debt to £5 million. In another 10 years they would have paid it off altogether. Is it not right that at the end of 10 years the municipality of Sheffield should own the equity of that undertaking? That would mean that each year £500,000. which has been spent in paying off the debt and paying interest charges, would be used in Sheffield to reduce the rates of electricity and thereby provide cheap power which would attract to the city production which, in its turn, would bring employment and prosperity to the citizens. I submit that is a very real asset. I stand here representing my constituents in Sheffield. As far as I can see, they will lose a great possibility of future employment and prosperity.

Anther point was made by the hon. Member for Winchester (Mr. G, Jeger), and I am sorry that he is not in his place, because I agree with him when he asked the Minister to look into the question of costs. In Sheffield, £9,000 a year from the electricity undertaking has been used towards the overheads of the City Council. That is going to be lost under the Government's proposal. Though the Minister talks about not wanting people to make a profit, so far as I can see, from the point of view of Sheffield, there is going to be a loss, and I put the point to the Parliamentary Secretary, hoping that he will look into these matters, which I have put up sincerely from the point of view of Sheffield.

Then there is the question of electricity. I have not heard any suggestion that the municipal undertakings, particularly that of Sheffield, are inefficient. Again, I ask that question of hon. Members opposite. I have facts and figures, for instance, showing that, to the largest type of consumer, the price is.29d. per unit, which is extremely low, though it has risen recently. I should like to quote one comment from the Socialist Chairman of the City Electricity Committee: The Committee claims that Sheffield possesses at the present time one of the most efficient and well-managed electricity undertakings in the United Kingdom. I believe that to be true. The point I am trying to make is, What advantage is to be expected from this Bill, so far as the municipal undertaking of Sheffield is concerned?

There are other disadvantages to municipal undertakings. First of all, municipal undertakings—water, electricity, trams and so on—are correlated and run from one office. What are the Government proposing to do, under this Bill and the Transport Bill? They are taking away the co-ordination which has been built up and splitting it up amongst new authorities, thus disintegrating what has been built up in the past. Secondly, there is the question of local industries. In Sheffield, special alloy steels for furnaces are required, and it has always been the pride of Sheffield that we have produced the kind of power at the right place and at the right time in order to build up our industries. What advantage can there be in taking that away from the people who really know about it and centralising it in Whitehall? I do not accept what the Minister says when he declares that the area boards will be autonomous. The Bill says quite definitely that the Central Authority will determine policy and the final authority goes to the Minister.

We have heard in the past of the great record of municipal work, and, while looking back into the past and recalling how Conservative and Liberal Governments have built up this municipal idea, I want to appeal to our Liberal friends. I hope that, before they vote tonight, they will consider the great traditions which Conservative and Liberal Governments have built up in municipal trading. In just under two years of Socialist rule that achievement of the local-authorities is being taken away from them and centralised in Whitehall. Socialist councillors are getting worried about this, and I hope that there will be some enlightenment. I only wish to quote the Socialist Chairman of Cardiff, who was mentioned by my right hon. Friend in his opening speech yesterday: There is more danger to Socialism from over centralisation than from local bias. We are in danger of passing into the hands of regional gauleiters and commissars appointed by the Minister in the name of efficiency. I feel most strongly that there is a great deal in that. If the Socialist Government are going to take away the right of the local authorities to run these local industries, the time which has been given by people who know the facts about those industries will be wasted in handing them over to a central authority.

My next point is in regard to the position of the employees in this industry. The Coal Industry Nationalisation Bill, when it appeared on Second Reading, was badly drafted in this respect, and, in the Committee proceedings upstairs, hon. Members from this side of the House succeeded in securing considerable amendment. I hope that that will be the case with this Bill; but the Bill, as at present drawn, does not give anything like the safeguards which should be given to the employees in this industry. Despite what was said by the hon. Member for Stratford (Mr. Nicholls) early yesterday afternoon, I maintain that happy relations already exist in this industry. The hon. Member described the conditions of people working on the top of boilers as being bad conditions. We had the same sort of argument about people working at the coal face in two feet of coal. Nationalisation is not going to make boilers any less cold—unless they do not get any fuel at all—and conditions at the coal face will remain the same as they are now, so that those arguments, I think, are quite unavailing. Labour relations in this industry, I repeat, are good. What is going to happen? Mention has been made of the compulsory transfer of services, and I do not propose to labour that point. All I want to say is that, in the law of this land, we have never allowed the compulsory transfer of personal services. I cannot say to a man, You work for me today; I will force you to work for somebody else tomorrow. Yet this Bill is bringing in that concept, which, I am sure, is wrong. On the question of pensions, I think these should be obligatory, whereas the Bill says that the Minister may produce pensions. The Coal Industry Nationalisation Act makes pensions obligatory, and I hope that the Parliamentary Secretary will refer to this point and give us an answer.

The last basic point on this subject concerns the question of the position of the employee in a nationalised industry. What is going to be his position? Is it really going to be any better, because, at the moment, taking Sheffield as representative, the employee has the opportunity of seeing his councillor, and he can, if he likes, go to see the committee on the spot. When we get nationalised industry, we get the impersonal touch. The Post Office is a good example. There has been a good deal of dissatisfaction in the Post Office, particularly among the night telephonists, but what is the attitude of the Department? What does the Assistant Postmaster-General say when we press him with questions? That the staff are expected not to raise this issue through Parliamentary channels until they have first made full use of their own machinery. Is that right? Do hon. Mem- bers really believe that? Have not we been fighting in this House so that members of the Forces may use us if they wish to ventilate their cases? Why, if we can ask questions of the Secretary of State for War, cannot we ask questions about the great T.U.C. and its workings? I suggest that that is very wrong, and that people should be able to come here, if they want to, and get help, and I am vey much perturbed about this aspect of nationalisation.

What about the civic rights of these people? Are they going to be allowed to enter into local councils and be on Church councils? We have had an unfortunate experience of this with the National Coal Board. As hon. Members know, in the North-Eastern Division, the civil rights of councillors and others have been taken away from them. Will that put them in any better position? I ask the Parliamentary Secretary to consider these things. Lastly, on this point of labour, are we certain that it is the intention of the provisions of the Bill, which says that the Minister shall be able to come to terms between certain trade unions in order to bring up conditions—and I think the hon. Gentleman knows the Clause to which I refer—to bring about the justice for all workers which we want? This was another point which comes as a legacy from the Coal Industry Nationalisation Act, though it now seems that we can draw an analogy from that Act suggesting that the Authority is saying, "I will talk to this union, but not to that one. I will select the union to which I will talk." How can it be to the advantage of the employee to be placed in that position? To sum up, I can see nothing in this Bill, as at present drawn, which' gives the worker a better position than that which he is in at present, under either a municipality or private ownership. Therefore, I would plead with the Parliamentary Secretary to reconsider whether this is the time, when the White Paper on industry has just been published and when we realise that we must get down to reconstruction, to introduce a Bill of this kind.

We have heard a lot about dislocation. I am afraid that, if this Measure is rushed through, the organisation will not be ready to take over and run the industry after the vesting date. If I may be allowed to draw another analogy from the national- ised coal industry, I would remind the House that a certain large number of coke oven undertakings in Yorkshire were taken over on the vesting date. One particular manager was called out and told to run all those undertakings. He was also told "We have no offices and no staff for you." That is what we mean by dislocation. I am certain that, this time, we want everybody's energy and co-operation for the production of electricity; we do not want men looking round and saying to themselves, "Am I going to get a job on this board or that, or am I going to be moved elsewhere." I suggest that the Minister should reconsider that particular aspect. Nationalisation has not always proved a success. This year, the nationalised coalmines of Czechoslovakia made a loss of £5 million. Is the Minister right in thinking that he can now rush ahead on these schemes and always produce the answer he wants?

I should like to quote two instances of where he was not infallible. Last year, he hoped he would get 8,000,000 extra tons of coal; he hoped it, but he did not get it. This year, he hopes that he will save 3,000,000 tons of oil fuel; he has hoped, but he has not got it. I do not blame him for that, but I would ask him to think again. I suggest that people of all parties should say, "The Minister has nationalised coal. Let him see whether that is a success or not before going ahead with these other schemes." Therefore, at this stage, I would ask the Minister to reconsider the matter, and to withdraw the Bill.

7.34 p.m.

Mr. Burden (Sheffield, Park)

I note with pleasure the tribute paid by the hon. and gallant Member for the Ecclesall Division of Sheffield (Major Roberts) to the work of the Sheffield Municipality and, in particular, to its electricity undertaking. It is not often that one receives tributes of that kind from hon. Members opposite, and they always choose their opportunity for paying such tributes. It is only necessary for me to mention in that connection, that, since 1926, with the exception of one brief year, I believe, Sheffield has been controlled by a Labour majority. When one remembers the bitter opposition which has been the normal policy of the Tory Party in regard to municipal trading and undertakings, one is very pleased to receive such a tribute.

Major Roberts

Surely, the hon. Member will agree that the electricity undertakings, as such, were placed in the hands of the municipalities with the wholehearted support of the Liberal and Conservative votes?

Mr. Burden

But it must be remembered that it was the vision and forethought of Socialist Members, wishing to develop the services for the good of the community, which led to this great development. When one looks back through the history of municipal trading, one finds that, all along, it has been Members of the Socialist Party who advocated municipal trading and municipal enterprise, as against the line taken by the other side.

I join with other hon. Members in protesting to? the Minister against what I regard as the somewhat cavalier treatment of the local authorities under this Bill. It is true that the Minister pays lip service to local authorities, but, having done that, he proceeds to take over their undertakings on terms which, I am sure, he would not dare to propose to private enterprise. The Minister gave not the slightest indication that he had any appreciation of the severe financial impact of his proposals on local authorities owning electricity undertakings. Surely, local authorities are entitled—and here I must differ from the hon. and gallant Member for the Ecclesall Division of Sheffield—to say to the Minister, "We are ready and willing to come into any national plan which will help to bring the benefits of electricity to the whole of the community, but, in so doing, we do not think that the local authorities ought to be placed in a worse financial position." I suggest to the Minister that it is unfair to thrust upon the ratepayers increased local rates as a result of the willingness of local authorities to co-operate in a great national plan. To put the matter quite bluntly, local authorities ought not to be placed in a worse financial position just because their profitable undertakings must now form part of a national plan. I would ask the Minister to tell the House how he proposes to deal with that problem.

Secondly, I beg the Minister to realise that many members of local authorities have devoted much time, knowledge and enthusiasm to the building up and to the success of the operations of electricity undertakings. Those undertakings have been matters of civic pride, and members of local authorities, in creating and building them up, have developed that civic pride and community spirit. Is all that valuable public work on the part of devoted men and women in the public service to be ruthlessly scrapped? It is not good enougl to say that consumers' interests will be adequately safeguarded by the appointment by the Minister of a few members of the local authorities to consumers councils. I repeat that that is not enough. I would ask the Minister 10 ensure that members of local authorities now owning electricity undertakings should be appointed, as a right, on the area boards, and thus maintain that direct representation as between the municipality and the governing body, so far as the industry is concerned. Many progressive local authorities have built up substantial financial reserves. That was part of a wise business policy. Does the Minister propose—I will try to use a non-controversial expression—to appropriate those reserves?

I would like to say a few words about the staffs of local authorities who may be adversely affected by these changes. In view of what has been said about these staffs, I hope the Minister will give the House an assurance that long-established precedents in relation to the staffs of undertakings which are taken over will have full and adequate protection, and that there, will be a complete understanding between the Minister and the appropriate organisations which can rightly claim to speak for these people. I hope local authorities, though feeling the loss of these undertakings, will see the wisdom of coming into a national plan, but I beg the Minister not to leave with the local authorities a rankling sense of injustice in connection with the transfer. Therefore, I ask the Minister to take into the fullest possible consultation those organisations who have an established right extending over many years to speak the united voice of the local authorities.

7.42 p.m.

Colonel J. R. H. Hutchison (Glasgow, Central)

There is in this Bill some variation of the pattern to which we have become accustomed as one nationalisation Bill after another passes rapidly across the Floor of this House. Hitherto, some evil or major defect of the past has been pointed at by the Government as requiring to be put right. Coal, for example, was the cockpit of political ideologies for a generation; rail and roads were at loggerheads until the war; in the matter of Cables and Wireless there was representation from the Dominions, and, of course, any representation that comes from overseas—India, Burma, Egypt and Palestine—must be treated with deference. Those Measures have some substance of argument behind them, but here we come to a very different case. It has been admitted on all hands that the record of this industry has been one of constant efficiency and improvement. The Simon Report, commenting on this, said it was largely clue to the intense competition of the gas industry that both those industries and the public had benefited by that competition. The Minister himself, in one of those moments of fairness which descend upon him from time to time and which I admire, used these words only a short time ago: In the matter of electricity, let me admit the great developments which have been made by those in control of the industry. Here we have a record of growing consumption of electricity, of constantly reducing prices, of constantly improving fuel efficiency. Is that progress to be continued under this Measure? Is it not a natural assumption that if the war had not intervened that progress would have been continued? That is one of the answers to the hon. Lady the Member for Blackburn (Mrs. Castle) who asked what guarantee there was that this progress would continue without this Bill. That progress has gone on throughout the history, of this industry, and there is no reason to suppose that it would not have continued in the future.

I agree, and on this side of the House we freely admit, that there were defects. What industry, what Ministry, has not some defects in it? Let the Ministry that is without defect cast the first stone. It may be true that there may be too many generating and distributing undertakings, that more standardisation of voltage and of equipment, and variation in boundaries are desirable. All that is already planned and can be carried out without half the disturbance which will be caused by this great Measure with 56 Clauses and 85 pages, whatever the Minister says. The McGowan Report and the Cooper Report, both of which have already been quoted, came down against this radical and drastic cure for so small defects. Of course, one can cure a headache by cutting off one's head. This proposal leaves efficient industries aghast. Up to now there has been at least this to be said for the Government programme: there was the spur upon industries that if they were not efficient they ran the risk of nationalisation. But here we have the proposal to nationalise an efficient industry for no better reason than that it is an efficient industry, and presumably the Government want the credit for that. Industry is despairing. When they see a Measure like this, when, in spite of this industry's magnificent record, they find it is to be treated in the same way as those against which so many stones have been cast and against which so much criticism has been levelled, they despair.

I congratulate the Secretary of State for Scotland on the organisation which he has achieved for my country. He has managed to wrest from the hands of the Minister the right for the North of Scotland Hydro-Electric Board, now to be called the North of Scotland Board, to continue with its rights, responsibilities and allegiances. I only wish he had been able to go further. He has certainly had the boundaries extended, but, as my hon. and gallant Friend the Member for Pollok (Commander Galbraith) said yesterday, it would have been a much more reasonable and rational line of delimitation if under that organisation the whole of Scotland had been treated as one unit. The Secretary of State for Scotland has been making great play with this and, no doubt, with the psalm in his heart: I to the hills will lift mine eyes From whence doth come mine aid. —he has been making speeches about what he has achieved. We welcome what he has achieved, but we urge him to go on with the struggle. There is no boundary more normal, no decentralisation more natural, than to decentralise from Whitehall that part of Britain that lies most distant from it. The right hon. Gentleman the Lord President of the Council has already told us that reasonable decentralisation is part of the Government's plan. No decentralisation could be more reasonable than that the Scottish Board which is already in existence should look after the whole of Scotland.

I wish to protest as vehemently and as strongly as I can against the treatment of municipal undertakings' and to add the weight of my words to the wise words that we have heard from the hon. Member for the Park Division of Sheffield (Mr. Burden). This is expropriation from municipal authorities without a vestige of justification. Here we have that very thing which the Chancellor of the Exchequer appealed to us in one of his Budget speeches to do. I refer to ploughing back, prudent management being penalised, big and small debts being taken over and assets being taken away. In the city a constituency of which I have the honour to represent there are assets which have been paid for by the consumers of electricity who, in the main, are the ratepayers. That property belongs to the ratepayers of the city and they regard it as an asset. That is going to be taken away.

I would like to draw the attention of those Members of the House who are interested in Scottish rating to the fact that if the rates in the City of Glasgow were put on an equivalent basis to those in England and the same calculations used, they would already be approximately 40s. in the £. We cannot afford to lose anything, to have any further burden put upon the shoulders of the ratepayers of the city. Therefore, I wish to add my voice, as strongly and as vehemently as I can, against what is being done. What are the Government teaching the country? What subversive lessons are being thrown out to the population of Great Britain? First, that the efficient are to be dispossessed equally with the inefficient; secondly, that prudence is to be penalised; and thirdly, that fair play is to be abandoned. Blithely they face the future, and blindly they ignore the present.

Now, for a few short moments before I finish, I wish to draw attention—and particularly the attention of the Parliamentary Secretary—to a small body of individuals and of undertakings which has been completely left out of the Bill. I know the Ministry are now aware they have been forgotten; perhaps the light went out when they came to consider it. I refer to the non-statutory undertakings. There are more than 300 of them; small people, insignificant people, sometimes commercial concerns who supply a village with its electricity, sometimes a private individual who does it. So far as I can see, in this Bill there is no provision whatever for what is to happen to these people. Will the Parliamentary Secretary tell them, tell me, tell us, what is the intention? Have they been left out purposely? Are they to be left out of this great plan, to muddle along as best they can? What will happen if that, in fact, is the intention? Why, sooner or later one of the area boards will come along and say, "But we ought to supply electricity there". Then what will happen? They will come to these non-statutory undertakings and say to them, "You clear out". What, then, will be the basis of compensation? Those individuals, those small concerns, will be completely at the mercy of the area boards, and no provision of any kind is made for them in the Bill. I ask the Parliamentary Secretary to regard this matter seriously. A relatively large number of people are concerned. What I suggest to him is that, before the Bill reaches the Committee stage, there should be inserted a Clause which allows those individuals, when they are dispossessed by the area boards, as undoubtedly they will be, to have their compensation assessed by a neutral tribunal.

The roundabout goes on. The piling upon Ministers' shoulders of responsibilities with which they have neither the time—because there are not enough hours in the day for them to be able to consider them—nor the ability to cope, from which "Solomon in all his glory" would have shrunk, is producing a situation of evergrowing chaos in this country. The country is frustrated, hesitant, doubting, despairing, and is carrying on its back, like a modern Sinbad, one tenth of a civil servant for every working man in the country. That is gradually bringing a once sturdy industry to its knees; and with Measures of this kind, penalising prudence and nationalising efficiency, would it be surprising if, what half a dozen enemies have failed to do throughout a generation was brought about in two short years by a Socialist Government?

7.54 p.m.

Major Wise (King's Lynn)

During this Debate we have travelled round the large cities of the United Kingdom and dealt with the problems of the corporations of those cities and their local government affairs. I want to take the House to the countryside, and to look at this Bill from the point of view of those who have to dwell in the rural areas. If I may paraphrase what the hon. and gallant Member for Central Glasgow (Colonel Hutchison) has said, we say to them: "Darkly we have sat in the past; now let there be light." I hope this Bill will be instrumental in bringing to the British countryside the light which we need. I desire to make an appeal on many grounds. First and foremost, I appeal on behalf of those women of Britain who, in the past, have had to work in cottage homes, and the large farmhouses, under the disadvantage of oil lamps and similar illuminations. Those people deserve the same treatment, facilities and amenities as their opposite numbers living in the cities and the towns. I also wish to make an appeal on behalf of the great agricultural industry. In agriculture, we are looking to the benefits which electricity can give to us in the future, benefits which have never been conferred upon us in the past by private enterprise. At the moment, there are hundreds of thousands of farmhouses and farms in this country which are not served, in any shape or form, by any electrical body. It is their needs which are uppermost in my mind at the present time.

I now wish to deal with the facilities which must be granted for the purposes of the housing progress to which we are all looking forward. We cannot possibly expect to get our folk back into the villages, unless it is made possible for electricity to be brought to them. We on this side of the House are not thinking of building all our houses in the villages. We are hoping to create colonies where they are needed, and it is impossible to complete these houses unless we can bring to those colonies the necessary electrical services. The smallholdings programme will, I hope, be accelerated in the next few months. Each smallholding will require electrical services. In the existing circumstances, is it possible for private corporations, or private concerns, to take electricity to these outlying farms of Britain?

I wish to give the House the benefit of an experience which I had. My farm is a lone farm, two miles from the main electricity supply line. A few years ago, like every other farmer who wanted electricity, I asked the local company what would be the cost of supplying me with electricity. It needed two miles of lines, a transformer possibly, posts and the rest, and the estimate given to me by that private concern was £600 per mile—£1,200 to put me on electricity. It was simply a desire on their part to obtain from me part of their overhead charges. The obvious thing to do—which I did—was to instal my own plant, at a cost not of £1,200 but of £200, and I saved by that a good round £1,000. That, however, does not end the story. That plant is not sufficient to supply all my buildings and my machinery with electricity, and over a year ago the local concern came to me and said, "Can we bring you into a scheme with other farmers around?" I said that I was prepared to accept such a scheme, and to go in with the rest of the farmers, because within sight of my house there is not at the present time a single farm served by electricity apart from my own. That was over a year ago. The Opposition are talking in terms of progress and efficiency, but none of us has heard a word about the project since. It might have been window-dressing, it might have been anticipation, it might have been knowledge of the great Bill which is now before the House. Schemes have also been mooted between the supplying companies and the National Farmers' Union.

Colonel J. R. H. Hutchison

Is not that just the very sort of dislocation which we say will supervene on all these plans?

Major Wise

No, in my view it is the collapse of private enterprise initiative. If initiative had been shown the scheme no doubt could have gone on. It is not only in my own county that it is almost impossible to take electricity to the farms, hamlets and villages. We are stuck on all sides. With regard to the scheme of the National Farmers' Union, which has been mentioned by hon. Members opposite, the scheme itself may be good in parts, but its cost to the farmers is prohibitive. According to the notes I have in my hand, if the scheme went through 150,000 farmers were to be supplied with electricity, and the average cost to each farmer would be £200 for the installation. In some cases it might be £100, but in others it might mean that farmers would have to pay between £500 and £1,000, and under that scheme there is no guarantee that electricity will be carried to the outlying farms. Where it is not profitable to take electricity, the supplying companies will not take it.

I commend this Bill to my friends in the countryside. We are safeguarded, and we are particularly interested in Clause 1 (6). Agriculture and the countryside are not over much referred to in the Bill but there is our safeguard, and we are further safeguarded by the excellent speech made yesterday by the Minister, in which he purposely and emphatically dealt with agricultural problems and gave us an assurance that at long last those in rural Britain who need electricity will obtain it.

8.5 p.m.

Mr. Boyd-Carpenter (Kingston-upon-Thames)

The hon. and gallant Member for King's Lynn (Major Wise), for very understandable reasons, devoted most of his speech to a discussion of the very real need for electricity in the rural areas. I would very respectfully suggest that that has remarkably little to do with this Bill. Electrification in the rural areas could be obtained without this Bill, and it is equally true that there is no guarantee whatsoever contained in this Bill that such electrification schemes will be carried out. The hon. Member made a perfectly fair point that there was no guarantee in the scheme put forward by the National Farmers' Union that electricity would in fact be carried into every homestead. Nor is there any such guarantee in this Bill, and I would invite the attention of this House to the fact that the issue before it this-evening is not whether rural electrification is a good thing—as to that there is really no argument—the question before the House is really twofold; whether a case has been made out for the nationalisation of electricity, and, if such a case has been made out, whether this Bill is a good and efficient method of doing it.

The two habitual and by now rather threadbare arguments for nationalisation cannot be used in this case. It is not sought to be suggested that this is an inefficient industry, nor is this the case of a straight clash between the principle of private enterprise and the principle of enterprise by public authority. The Minister himself, in moving the Second Reading yesterday, told the House that the major part of this industry was already in the hands of public and local authorities, and therefore there is no question here of those matters which arouse so much emotion opposite as to the wickedness of private profit and the moral-superiority of public enterprise. So far as the greater part of the industry is concerned, what this Bill does is to transfer ownership and control from a number of local and public authorities and place it all in the hands of one enormous and monstrous corporation. I listened with very great interest and great respect to the very couragous speech made from the opposite benches by the hon. Member for the Park Division of Sheffield (Mr. Burden), who with considerable force made the case against this taking-over of the electricity undertakings of the local authorities. Even from the standpoint of hon. Members opposite, "Let us Face the Future" and all that sort of thing, what case is there for transferring the industry from one form of public ownership—local, democratic, flexible and in close touch with local needs and local feeling—to this monstrous corporation which, if the precedent of the Coal Board is followed, will be completely isolated from criticism, Parliamentary or otherwise?

The right hon. Gentleman dealt in a very cursory way with the very strong financial case for the local authorities to which the hon. Member for the Park Division of Sheffield referred. Why is no compensation other than the taking-over of their debts being given to the local authorities? The right hon. Gentleman the Minister, when he spoke yesterday, said in a rather airy way: Local authorities have always displayed a sense of public duty and will not wish to make any profit from the transaction."—[OFFICIAL REPORT, 3rd February, 1947; Vol. 39, c. 1416.] How does the right hon. Gentleman know that? Has he asked the local authorities whether they agree that his terms of compensation are fair? Is he really satisfied, without asking them, that these responsible public bodies are quite prepared happily to let the assets of their ratepayers go and enjoy the process? The right hon. Gentleman has no right whatever to tell the House that the local authorities have no objection to these compensation terms unless he is in a position to assure the House that he has asked the local authorities that question and they have given him their answer. I hope that when the Parliamentary Secretary replies, he will tell the House whether, when his right hon. Friend said that the local authorities did not want to make any profits, that was simply the right hon. Gentleman's ordinary technique of airy persiflage, or whether he has any evidence to give to the House in support of it. The Parliamentary Secretary must realise, as did his right hon. Friend, according to his speech, that local authorities have carried out different policies in this respect. Some of them—the right hon. Gentleman said 20 per cent. of them—instead of paying back capital, have used the proceeds of the undertaking for the benefit of the rates. Those—and from the tone of his speech they are the local authorities of whom the right hon. Gentleman disapproves—are, comparatively, to benefit under these terms, because they are to be relieved of their full capital liabilities, whereas the others who have conscientiously and painstakingly paid back the money which they borrowed are correspondingly less compensated.

I ask the Parliamentary Secretary, when he replies to the Debate, to tell the House, first, whether the local authorities are satisfied with this miserable form of compensation and to give the names of the local authorities which have been prepared to say that they are so satisfied; secondly, to deal with the question of why there should be transfer from one form of public ownership to another; and, thirdly, to say whether he considers it fair to compensate on a basis which penalises the prudent and economic authority and is correspondingly less severe on the more extravagant authority? Let the Parliamentary Secretary, and the Government of which he is such a distinguished, though somewhat recent, recruit, bear in mind that what they are doing today in this industry has its repercussions throughout the whole of the industrial field. Right hon. Gentlemen opposite, in their more sanguine moments, tramp the country announcing that they propose to nationalise right, left and centre. They may not appreciate that those speeches are listened to. [An HON. MEMBER: "They are meant to be."] An hon. Member says that they are meant to be listened to. Having read some of the speeches, I take leave to doubt that; but in any event, right hon. Gentlemen opposite are putting out in the country this general threat of nationalisation. Does not the House realise that the example of the method of compensation in the case of electricity, in which the authorities that conscientiously pay back capital are penalised, is an extremely bad example to the rest of the industrial field, and that precisely the economic policy which the Chancellor of the Exchequer is untiring in advocating in the House and elsewhere is being sabotaged by the bad example of the compensation provisions proposed in this Bill?

There is only one other matter to which I invite the attention of the House. The right hon. Gentleman the Minister of Fuel and Power, in a speech which, I suppose, achieved a new record of calculated irrelevancy in introducing a major Bill, observed, in parenthesis: Too long has the electricity consumer been made the victim of financial speculation."—[OFFICIAL REPORT, 3rd February, 1947; Vol. 432; c. 1421.] The House, I believe, is already in possession of the facts that in the 23 years between 1922 and 1945 consumption of electricity provided by this industry multiplied 10 times, and that during that period the cost per unit fell from over 1.3d. to just over id., a fall of roughly one-third. To describe an industrial expansion which resulted simultaneously in a tenfold increase in consumption, and a 33⅓ per cent. fall in cost, as exploitation of the consumer is really to misuse the English language; and I can only comment that the consumers of an existing State monopoly, the Post Office, would be very thankful indeed if they had been exploited in so beneficial a manner. It is really nonsense for the right hon. Gentleman to bolster up his case by describing as exploitation of the consumers a state of affairs of that nature. It is surely beyond dispute that great benefit has been spread throughout this country, to industry and domestic consumer alike, by the immense increase in productivity of the industry, coupled with a steady fall in cost. I hope that, if the right hon. Gentleman is going to describe this as exploitation of the consumer, he or the Parliamentary Secretary will point to any other industry in the country with a comparable record.

The House well knows that it is neither of the normal reasons for nationalisation which has actuated the right hon. Gentleman in bringing forward this Bill. No sensible person could suggest that there is exploitation. No sensible person could say that any great principle or issue arose in an industry of which already more than half is publicly owned. What is apparent is that this is simply one instalment of the process in which the right hon. Gentleman is a most vigorous practitioner, the process of bringing into the centralised hands of Whitehall and the Whitehall bureaucracy a stranglehold over the economic life of this nation.

8.17 p.m.

Wing-Commander Shackleton (Preston)

I must congratulate the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) on his terrifying eloquence, but I think he went a little far when he put words into the mouth of my hon. Friend the Member for the Park Division (Mr. Burden) in suggesting that the local authorities, as reported by the hon. Member for the Park Division, opposed nationalisation. My hon. Friend did not make that point. He said—and I hope to address myself to this matter—that the local authorities are not satisfied with the treatment they are to receive from the point of view of compensation. That point has been put to the Minister on many occasions, and I must apologise for trying to ram it home once again. It is not simply a question of paying compensation only. It is a question of preventing loss to the local authorities.

In my constituency, Preston, there is a very efficient electrical undertaking which has been wisely, and I might even say conservatively, administered for the last 24 years. For the last 18 years there has been a Socialist chairman of the electricity committee. The Preston undertaking has not aided the rates. A neighbouring undertaking has aided the rates to the tune of £176,000. We have not done that in Preston, and now we feel rather aggrieved. We feel that, far from making up the rates to the other places, we should get some of the benefit that we have been denied in the past. In fact, we have a very convenient sum on which we would like to lay our hands. There is a total of £250,000 in reserves and in balances, some of which we suggest should be made available to make up the loss which the county borough will suffer. The way in which they will suffer a loss is already known to the Minister, and it was referred to particularly by my hon. Friend the Member for Houghton-le-Spring (Mr. Blyton). I will mention only the question of the off-setting of Income Tax and the loss to the establishment. By removing the business of the undertaking from the establishment of the borough, we shall be losing a return in actual payments from the undertaking of about £6,000 per annum. Some of the staff will probably go, and therefore the loss will not be a total one. Nevertheless, a loss will be suffered.

I suggest that it is only fair to the municipal undertakers who have done their duty properly and have administered their undertakings in a wise and efficient way, that they should not be made to suffer. On the other hand, I would again emphasise that I strongly support the nationalisation of electricity. We realise that there are a lot of individual, and probably efficient, producers, but they are not as good as a properly co-ordinated industry, which will be geared for the benefit of the whole country. That point has not been answered by hon. Gentlemen opposite. Every committee report up to, and possibly including, the time of the Coalition Government, advocated some form of unification. The alternatives were clear. They were either the unification—which the McGowan Committee did not openly advocate—of the industry under private enterprise and the wiping out of municipal undertakings, or, on the other hand, total public ownership in a nationalised concern.

The argument which was presented by the hon. Member for Stockport (Sir A. Gridley), that the advent of atomic energy was one reason why the State should not take over the power stations on a national basis, is, to my mind, the final argument for nationalising the electricity undertakings. I hope that the Minister will be able to tell us that the electricity authority will investigate the application of atomic energy to the production of electricity. I hope that he is in close contact with the Minister of Supply on the matter. I mention that point only by the way, because I feel that it supplies an additional argument for nationalisation.

I am satisfied that the Opposition have completely failed to answer the arguments which have been put forward from this side of the House, or—and this is the millstone around their necks—to supply a satisfactory alternative. I suggest that they con- tinue their search for a policy for the Conservative Party. They may find that the nationalisation of electricity comes within it.

8.23 p.m.

Mr. Harold Roberts (Birmingham Handsworth)

If I am to declare at the outset my interest in the electricity industry it would be that I am a ratepayer of the city of Birmingham. The object and the purport of the Bill is, in the course of unifying the electricity industry, to confer upon the Minister power over that industry such as he has at the moment over coal, which, is another form of fuel. It is well that we should have been reminded that one day we shall have to face our constituents. An hon. Member opposite who reminded us of it addressed a kind of solemn warning to us to be careful lest we might find angry constituents. It makes me tremble to think that I might have to go back to Birmingham and face the people from Austin's and. Dunlop's who are out of work, and have to admit to them that I have not voted in favour of giving greater powers to a Minister who has displayed such powers of coordination and management. I only hope that they would deal lightly with me.

The Bill marks a further stage in that divorce between morals and arithmetic which was so happily foreshadowed by the Chancellor of the Exchequer during the Debate on transport. Subject to qualifications, I think that divorce is beneficial. It enables one, in criticising finance, to use metaphors and similes, and to say things which would otherwise be thought grossly offensive and improper. Two qualifications are open. The first is that arithmetic should, as far as possible, be free from glaring errors, and, secondly, that an argument, once adopted, should be pressed to its logical conclusion. Suppose, in criticising this Bill, we were to say: "If we are able to cut down loan charges from £40 million a year to £23 million, then we shall save £17 million, which can go to the improvements of the undertaking." That is the type of argument used by the very right hon. Gentleman who wanted to divorce morals from arithmetic. He completely forgot, and very often I think the Government benches forget, a little matter of nine shillings in the pound Income Tax. In that particular Measure the true saving was not £17 million but just £9 million. After all, what are £8 million in these days of spacious finance?

The other proposal is this: A dispute has been raging between the Government and the supporters of private enterprise with regard to whether compensation on the basis of Stock Exchange quotations is right or wrong, and whether Stock Exchange quotations should be augmented on account of hidden assets. On that subject, the Chancellor of the Exchequer has been delighting the people of Gateshead with stories about charging more for Estate Duty. I will waste no time in arguing a point of that kind. Indeed, I am delighted to find the Chancellor definitely pledging and binding himself to treat people on a Stock Exchange basis.

What is a Stock Exchange basis? If happened to have a trifle of electricity stock—which I have not—and went to my broker to sell it at the price of the day, he would sell it, and within 14 days I should get my cash. Suppose he were to say: "Yes, Mr. Roberts, I will do it at that price, but, of course, you won't get the cash. One of these days, at the discretion of, the Minister, you will get stock at a rate of interest to be hereafter fixed, and redeemable—well, some time, but probably within the present century." I should then probably want more for my stock. I venture to make a remark. I really believe that the Eighth Commandment is still valid, and that if I take away goods from a man or from a corporation and do not pay the full and proper value, I am doing a robbery. The stockholders are to be given, not cash for the Stock Exchange figure but stock. Why? The obvious course for the Chancellor would be to pay the Stock Exchange figure, float a loan of the required amount, and pay cash out of it to the stockholders, giving those who desired it the option to take up stock.

Mr. H. Hynd (Hackney, Central)

If the hon. Member wants cash, is there anything to prevent him from selling his stock now to get it?

Mr. Roberts

That is a bright idea. It would not have occurred to me. This is the reason. As the hon. Member for Central Hackney (Mr. H. Hynd) has so cleverly mentioned, it is open to the stockholder to sell his stock. I wish I had thought of it before. But the point is that the stock is at the holder's risk, whereas.

on the other footing, the risk would be that of the Government and the Treasury, and, probably, it would hardly be hoped that the Government broker would be strong enough again to interpose to stop the local loans fiasco.

There is a further reason why this stock is, or might be, unprofitable, and why the Government desire to get out of it. Hon. Members may not all know it, but it is the declared policy of this Government to unbalance the Budget; to raise—[Interruption.] I am very glad indeed to see the Minister so amused. I will give him a, little more occasion for merriment. It is the declared policy of the Government to charm as much cash as possible out of the pockets of the people, and to ply reductions in taxation. I can understand the Minister's amusement, but the fact is that when the Ministers go into the provinces the exhilaration of the air there makes them say some things which, perhaps, they would not say here. On 19th November the Chancellor of the Exchequer came to Birmingham to address a meeting in support of savings, and, in answer to a question, he made a remarkable statement. In reply to a question about the remission of taxation, he said: If you give me a little longer I may be able to do more towards reducing taxation, particularly if you save well, because the more I get in savings the less I need to get in taxation. I recognise that even the greatest of men may sometimes be caught napping, and I think it unfair to fasten on to a casual remark of that sort without giving full and ample warning. Two days thereafter I wrote to the "Birmingham Post." I can assure the Minister that the report of this statement in the "Birmingham Post" coincided with the report in "The Times." I checked one against the other. I set out the passage and said this: One hopes that the Chancellor spoke unguardedly and without full reflection, because this statement, as it stands, can only mean that, if people subscribe handsomely in the savings drive, he will further unbalance his Budget by reducing taxation, and so widen, instead of narrowing, the gap between income and expenditure in our national Budget—a poor inducement to the public to lend to the Government. One assumes the Chancellor of the Exchequer has a proper and adequate Press cutting agency; but he took no steps whatever to disavow the statement that he made in Birmingham. The Minister can say, if he likes, that the Chancellor of the Exchequer is an irresponsible person; but I believe there is still such a thing as Cabinet responsibility, and that being so, I say that mat is the Government policy.

Mr. Kirkwood (Dumbarton Burghs)

On electricity?

Mr. Roberts

I am very glad indeed to Find—

Mr. Kirkwood

I thought the hon. Member said the Government had no policy. He cannot have it both ways.

Lieut.-Commander Gurney Braithwaite (Holderness)

Do not make the row in the Cabinet worse.

Mr. H. Roberts

I will say a word now about the local authorities. I hope I am not interrupting the genial conversation just proceeding. I say there is no moral reason whatever why local authorities should not be compensated for the loss of equity in their undertakings. It is significant that Socialist Members, although they applaud the Bill, and will, of course, vote for it—one would not catch them voting against the Government—try to placate their own neighbourhoods by saying they hope the Minister will do something about it. I have no expectations of that sort, but that does not deter me from saying what I think about the transaction. I say that the robbing of local authorities of their assets is quite unpardonable, and that there is no reason for it. I would not have given this illustration, but for the separation of morals and arithmetic by the Chancellor of the Exchequer. Take the case of two shops. The one sells goods honestly, and the other deals only in stolen goods until the police deal with it. It is the second shop which may make the better profit. The purpose of this fictitious Measure, as applied to public authorities and private investors, is merely to bolster up unsound finance and enable undertakings to show a profit on a fictitious written-down capital. In a recent debate of the Birmingham City Council, the Chairman of the Transport Committee said that if the policy of payment for assets was adopted it would strangle the scheme from the outset.

I now wish to say a word on the merits of the Bill. [HON. MEMBERS: "Hear, hear."] It is very touching to receive this encouragement from hon. Members opposite. They have managed to prove how extraordinarily inefficient is this industry, and how it must be inefficient in its heterogeneous state of non-nationalised ownership. I would point out that there is one institution which was socialised long ago, namely, the Post Office. The Post Office has always been held up by the Socialists as a model of administration of what might be if the State were to run things. At that time electricity was supplied at a cost of 1.55d. per unit, which means that a man could buy a unit of electricity for roughly 1½d. He could also post a letter for 1½d. In 1944, electricity was down to 1d. per unit, which, of course, shows the inefficiency of private enterprise. The same man could, therefore, buy a unit of electricity and have a ½d. change, but if he went to post a letter, he would have to pay a penny more, because the cost had been increased to 2½d. I take things as I find them, and I find that over a period of 15 years private inefficiency has managed to cut down the charges by about one-third, whereas the highly efficient State owner has put the prices up by about 70 per cent.

8.39 p.m.

Mr. Ivor Owen Thomas (The Wrekin)

The more I have listened to the contributions by hon. Members opposite, the more I have become convinced of the rightness of the Measure before the House. Nothing I have heard has made me think that Members opposite have any positive ideas as to the future of the electricity industry. It leaves me cold when I hear them posing as champions of the interests of local authorities. Local authorities go into business for one purpose and one purpose only, that is for giving adequate and reasonable service to the people whom they exist to serve. On the contrary, everybody knows that when a group of people go into an industry as a private company, be it the electricity supply industry or any other, they do so with the-ruling motive of making a profit, rather than to serve the public.

Mr. Osborne (Louth)

Does not the hon. Member realise that no company can hope to make a profit, unless they give good and efficient service?

Mr. Thomas

I can assure the hon. Member that I have paid many times for things and services with which I have afterwards been extremely dissatisfied. Further, I have had no remedy open to me to rectify the injustice. In those cases, a profit was made at my expense from each transaction. But when a service is rendered by a local authority I, as an elector, have a channel open to me through which I can make a complaint in order to secure rectification. That channel -does not exist between the customer and private enterprise.

Mr. Osborne

Has the hon. Member tried it with the Post Office?

Mr. Thomas

I will not waste time in rebutting the criticisms which have been made of the Post Office. I will merely ask whether any Member opposite would, calmly and deliberately, hand over the Post Office to a gang of private enterprise merchants. There might be a scramble to secure the holding, but I tremble to think what would be the nature of our postal services after the transaction had been effected.

Mr. Osborne

No worse than Austins today.

Mr. Thomas

It is no exaggeration to say that the Post Office is a great credit to our public service. We get full value for our money. But let me get back to electricity. [HON. MEMBERS: "Hear, hear."] I am glad that I have at last -stimulated the enthusiasm of hon. Members opposite. I will not go over the whole field of the present position of electricity supply today, but I have been reading a report in connection with the supply of electricity in the London area, I find that there are 70 or more services in the area, both municipal and private. I understand that there are competing services in many parts of London, that people can make their choice whether they take their supply from one side of the street, 01 the other. This fact stands out plainly, that if all those concerns were unified in one competent, rationalised, authority, there would be a far better and more economical service than that which is available today.

What suggestions have Members opposite to make as to the future of the industry? They have no alternative to the scheme put forward in this Bill, and no positive suggestions to make. I have reached the regrettable conclusion that They are entirely barren of ideas with regard to the future of this great industry. Everything which they have said is in the nature of "Stand fast," and there is good reason for that from their point of view. This Bill is the rational development of municipal enterprise into a national co-ordinated concern. What do we find in the field of private enterprise in the electricity industry? We have competition for a time, and it is usually the consumer who suffers by that competition. Sooner or later we have the development of combines and cartels, and this industry is a classical instance of how private enterprise in competition can sink its differences and make a bargain to its own advantage. The only conclusion that one can draw from that is that it pays private enterprise to get together, in some way or another, to fleece the innocent consumer. Private profit is the sole determining influence in electricity supply and every other field of private enterprise. The fundamental choice is not between municipal organisation and national organsiation, but between social organisation and private capitalist organisation. That is the fundamental issue in this Bill, which follows logically on the Transport Bill.

I had hoped to give figures of the amalgamation development in this country in connection with electricity, but I understand my time is limited. It is clear to me, that if we wish to get effective development in the distribution and production of electricity, this Bill is the only means by which that can be achieved. I challenge hon. Members opposite to place any alternative before the House or the country. I gladly make that challenge, because I am confident that they have nothing in their political programme to put in place of the Bill.

8.50 p.m.

Mr. Raikes (Liverpool, Wavertree)

The hon. Member for The Wrekin (Mr. I. 0. Thomas) inquired in a rather hopeful voice whether anyone in this House would hand over the Post Office to private enterprise. It might have been more relevant, in view of the fact that this discussion is on electricity, if he had asked whether anyone would take over the telephones. I think the answer is not a very difficult one. In view of past losses, it would be extremely difficult to get any private individual or individuals to take over the telephones, but if we did, we would get, as a result, a telephone service such as there is in the United States and in various other countries, under private enterprise. Such a change would be well worth while.

In making the last speech on this Bill from the Opposition benches, I propose to speak without indulging in personalities. Personalities are not my long suit, and at any rate are only valuable when one's case is a bad one. When one is presenting a good case, they go by the board. I listened to the Minister with deep attention yesterday afternoon and I found that one thing is beyond all dispute. Whatever might be at the back of the right hon. Gentleman's mind, he dealt with this Bill in a way which I would not have thought possible in the case of any Minister. He turned the whole barrage of his eloquence upon the so-called iniquities of the electricity companies, and by so doing, drew attention away from the Bill. He talked at some length upon the question of dividends. As far as the dividends are concerned there is no evil in them as such. The only case where dividends become evil, is if as a result of high dividends the public suffer, but I think that that does not apply here. What the Minister said with regard to dividends is not applicable to the industry which we are discussing. He knows as well as I do that, as far as the power companies are concerned, their dividends are dependent upon price conditions and upon a sliding scale.

Mr. Shinwell

Not in electricity. The hon. Gentleman must be referring to the gas industry.

Mr. Raikes

I do not wish to get into any violent dispute with the right hon. Gentleman, but I maintain without the slightest hesitation that although certain dividends were agreed to in the first instance in the early Acts, it has been, of recent years, a statutory policy to encourage efficiency of the power companies, by permitting them to pay higher dividends when costs fall. As far as other electricity undertakings are concerned, the position is slightly different,? They are subject to a maximum price. Not only are they subject to a maximum price but consumers can appeal, and ask the Minister to reduce the charges if those charges are considered too high. That is one of the great safeguards existing at the present time, and it is a safeguard which will vanish the moment this Bill receives the Royal Assent. The right hon. Gentleman is aware that, in the past, power was given to local authorities to take over companies if they thought that they could do electricity distribution and supply better.

That brings me to a point which the Minister himself made. Indeed he made it one of his great points early in his speech yesterday. He took the case of Bournemouth, and said that here we had an instance where a corporation desired to take over a company or that part of a company operating in their own area. He went on to state, as one of the reasons why he opposed that system, that it would have had the effect that 85 per cent. of the consumers of that company would have been absorbed by the Bournemouth Corporation, and that the result would have been high costs for scattered rural areas because the company would simply be left with 15 per cent. of a sparse area. As the right hon. Gentleman took that case, I assumed that it was the best he could bring out of the bag to prove his point. It was, in fact, half a truth, and we all know what a half-truth can be. As I have said, I will not enter into personalities. I merely remind the Minister that Poole, Bournemouth, Christchurch and Ring-wood rural district councils have, at the present time, a joint committee which proposes to purchase not only their part of the electrical company undertaking within Bournemouth but the whole lot. Negotiations have been going on—which this Bill will doubtless change—to enable the whole of the company concerned to be bought out by Bournemouth and certain other councils. I am assured that this is so, and it shows quite plainly that even in the Minister's own prize case a company can be bought up under existing conditions without any disadvantage to anybody.

Mr. Shinwell

Do I understand that this is the declared policy of the Conservative Party—that the municipal undertakings have the right to buy out private companies?

Mr. R. S. Hudson

My hon. Friend was just showing how inaccurate the Minister was.

Mr. Raikes

I have no desire to enter into an argument with the right hon. Gentleman, but I say that under the law as it stands today—a law which has been accepted for many years by many Parliaments, including Conservative ones—it has been admitted and permitted that local authorities could, if they were able to show that they could do the job better, have the opportunity of buying out a company. There is no objection to that whatever, and now the right hon. Gentleman has approved my reply. It has sometimes been said that words are a means to cloud one's real meaning, and I wondered whether anybody who listened to the right hon. Gentleman yesterday afternoon would have discovered the faintest glimmer from his speech of what was the position today. Would anyone have realised that the electricity industry in the course of the last 23 years has provided a tenfold increase for the people of this country? Would anybody who listened to him have realised that this industry, which he is determined to destroy from end to end, even during the darkest days of the war increased its output for all purposes by 45 per cent? [Interruption.]

Mr. R. S. Hudson

Does the Minister not know his brief?

Mr. Shinwell

I just wanted to confirm what I said to the hon. Member for Wavertree (Mr. Raikes), that he was quite wrong about the electricity industry being regulated by Statute in respect of prices and dividends. It was the gas industry.

Mr. Raikes

I have no doubt that the right hon. Gentleman makes that statement with the fullest confidence in his own check that it is correct. Nevertheless I have most carefully looked into the matter and have taken legal advice on it, and I am not prepared to withdraw what I have said. I challenge and disagree with the right hon. Gentleman's interpretation, but I accept that what he has said, has been said in good faith.

I have drawn a picture of certain facts which no one would have believed possible after listening to the right hon. Gentleman's speech. They were the things hidden behind the scenes. Would anyone listening to that speech have believed that the cost of coal had increased by 117½ per cent. in the course of the last six years and that the cost to the consumer of electricity had only increased by 8½ per cent.? Would anyone, from the Minister's speech, have realised that not only are those figures correct but that coal actually represents 62 per cent. of the total cost per unit generated at the present time—coal which has increased by 117½ per cent.? I maintain that those few facts alone put a very different complexion on the picture which has been painted of the working of the electricity industry. Would anyone who listened to the Minister have believed that the industry which he was nationalising was, so far as the consumers are concerned, already somewhere about two-thirds publicly owned? No one listening to the Minister could have taken any view other than that this was an industry primarily governed by private evil monopolies.

I want to say a word about the municipal angle, which is of vital importance to the majority of the people who use electricity. Undoubtedly, this Bill strikes a bitter blow against a big aspect of municipal enterprise. The Minister has said that because municipalities do not intend to make profits, they need no compensation and that if the Minister takes over the debt, all will be lovely in the garden. The Minister is doing well. He gets all the assets, and the sinking fund, but is that all? Did the Minister listen to the speech by the hon. Member for Houghton-le-Spring (Mr. Blyton) yesterday?

It was made by a man whose knowledge of the working of electricity undertakings, especially in Sunderland, is second to none. What will happen? The Minister takes over the debt and he gets the assets. In the City of Liverpool alone, the Ministers pays £7,500,000 to clear off the debt, and he gets assets valued today at £15,500,000. Not too bad, but the city which I happen to some extent to represent loses somewhere about £8 million. What does it mean? It means that where municipalities make a profit out of their electricity, that profit is an advantage in various direct and indirect ways to the ratepayers. In those cities which have been refered to, after providing for the reserve fund, a contribution is made towards the rates. In Liverpool alone, about £2 million has been subscribed towards the rates in five years, as a result of the profits of the electrical municipal authority.

Mr. Murray (Spennymoor)

The Minister wants some, plums as well as stones.

Mr. Raikes

But they are the sort of charges that affect the rates, and the hon. Member for Houghton-le-Spring said that in Sunderland these charges alone would make a difference of an 8½d. rate. And I imagine that the hon. Gentleman, having been chairman of the electricity committee of Sunderland, knew his business possibly rather better than the hon. Gentleman who endeavoured to interrupt me a moment ago.

Mr. Murray

The hon. Member for Houghton-le-Spring (Mr. Blyton) was not chairman of the Sunderland electricity committee. He was not even a member of it. He was chairman of the South Shields committee.

Mr. Raikes

Well, "a rose by any other name"—

Mr. J. Lewis

Would the hon. Gentleman subsidise the ratepayer at the expense of the consumer?

Mr. Raikes

As every hon. Member here is fully aware, there are indirect advantages gained by the municipality owning its own electricity. On the one hand, as the House knows, the advantages gained by profits upon the electrical side can be set off, for Income Tax purposes, and indeed are set off against the Losses on the services. Apart from that, in every conceivable instance where you have an electricity undertaking, that undertaking contributes towards the town clerk's office, towards the city engineer, and towards certain other departments where occasion warrants. All those things are an advantage to the ratepayers who, incidentally, are also consumers of electricity. All those things go under this Bill. The ratepayer is faced with a serious and complete loss but, on the other hand, the hopes of urban areas for reduction in electricity prices as a result of this Bill must be very slight. After all, if there is any object behind this Measure at all, it must be to pool, to some extent, urban and rural districts. Yet the Minister has utterly refused to commit himself upon that. I hope the Parliamentary Secretary will have the courage to do so, because the fact stands out that, in the urban areas it means a loss, direct and indirect, to ratepayers when these concerns go and if, on top of that, it means a further raising of costs to them in order to subsidise rural areas, whatever the, national interest may or may not be, it is a pretty gloomy picture for those who live in urban areas and in urban municipalities.

Mr. Gallacher (Fife, West)

Bear up under it.

Mr. Raikes

I shall bear up long after the hon. Gentleman has paid his next visit to Moscow.

Before passing to my next point, I should make reference to power companies. The book at my disposal is Studholme on "Electricity Law and Practice," which has been placed in my hand—[Laughter.] Hon. Members might laugh, but the Minister apparently has had nothing in his hand and merely relies on a verbal statement. I suppose the Minister will agree that this is the official book. It says: Control of dividends. Dividends payable by power companies are normally limited by special Acts which prescribe a sliding scale according to the difference between specified, standard, or maximum prices, and the prices actually charged by the company.

Mr. Shinwell

The hon. Member has made no point at all.

Hon. Members

Oh.

Mr. Shinwell

When the ribaldry has stopped, perhaps I may make my point. It is within the recollection of the House that what the hon. Member tried to convey was that every one of the electricity undertakings was governed by statutory Orders.—[HON. MEMBERS: "Nonsense."]—and it is also within the recollection of the House that he tried to convey the impression that the consumer could appeal to the Minister in the event of the case being valid. I have no power in the matter.

Mr. Raikes

I regret to say that the Minister has misrepresented what I said. The House will recollect that I differentiated most carefully between power companies and other electrical companies. Every hon. Member who listened knows that my first observations were directed to power companies, and power companies alone.

Mr. Shinwell

I am still within the recollection of hon. Members—and this is regarded as a vital point—that what the hon. Member tried to convey to the House was that general consumers are protected by statutory Orders. Now the hon. Member brings in this question of power companies, which are to some extent affected by statutory Orders. But he forgets that these companies supply in bulk, and the average consumer, particularly the domestic consumer, is not affected.

Mr. Raikes

I think there is no need for me to labour the point further, except to remind the right hon. Gentleman that when I said there was an appeal by the local authority, or the consumer, to the Minister, I directly and deliberately said that was in regard to other electrical undertakings, after I had dealt with power companies. If there is one thing I claim, it is that I have never intentionally misled this House, and I have not done so tonight.

It has been suggested by an hon. Member that there is no alternative of arty sort to nationalisation. My answer would be this. We realise that certain things could be done. We believe it is totally unnecessary to alter the whole structure of the electricity industry, but we believe that distribution in the country could be reviewed and the strengthening of the Electricity Commissioners could well be done with the object of reducing the number of undertakings. We believe again that the Electricity Commissioners should be empowered to require further and more rapid development in rural areas. They have power today to ask every company to give annual reports with regard to what their rural schemes may be. There is not one word in this Bill about rural development.

Mr. Ivor Owen Thomas

May I interrupt?

Mr. Raikes

I always like to give way to an hon. Member, but I have promised to sit down by 9.20, and I want the Parliamentary Secretary to have his full run. I hope—

Mr. Thomas

On a point of Order. I merely wish to deal with the comments—

Mr. Deputy-Speaker (Major Milner)

That is not a point of Order.

Mr. Raikes

There is a strong argument for having tariffs and voltages standardised throughout the country, but I would remind the House that there is a committee, instigated by the companies themselves, already sitting on that matter. I suggest that if these steps were taken within the structure of the present industry, it would be possible to obtain all we require at the present time without producing a Measure so fraught with dangers as this Bill.

I would sum up in a few words what are the greatest errors in this Bill. First of all, it removes all existing safeguards for the consumer as to price—every one. Secondly, it contains not one word placing an obligation upon the Board to develop rural supplies. I challenge the Parliamentary Secretary to find one word about that. We have heard what the Minister wishes, but that and what the Bill contains are separate things. The Bill destroys the existing rights of employees to compensation. It sets up consultative councils which are mere eyewash, which have no powers, no right of appeal, and are merely set up as certain other councils are set up, in other parts of the Bill, to look pretty and do nothing. Compensation to the companies has been shown, repeatedly in this Debate, to be inadequate. So far as the municipalities are concerned, it is not compensation but confiscation. Finally, during this period, before the vesting date is reached, the Measure means a period of uncertainty which can only create delay.

These are my principal reasons for believing that this Measure is a retrograde and reactionary Measure. It is nationalisation for the sake of nationalisation. It is typical of this Government that we have seen, again and again, the theoretical ideals of Fabian Socialism forced into our public life, to hamper and injure industry at a time when industry is fighting for its life as never before. That, in due course, will destroy this Government. That will be no loss. The danger is that if it is unchecked, if this form of restrictive folly is carried on, it may, in due time, bring chaos and catastrophe to the nation. It is for that reason that we on this side of the House in spite of the jeers directed at us about vested interests—because we believe that the interests of the nation come first- will fight this Bill to the end.

9.20 p.m.

The Parliamentary Secretary to the Ministry of Fuel and Power (Mr. Gaitskell)

I am obliged to the hon. Gentleman the Member for Wavertree (Mr. Raikes) for courteously curtailing his speech so as to leave me sufficient time to reply to this long and interesting De- bate. If it is not thought presumptuous for a fairly junior Member of this House, I should also like to extend a strictly personal welcome to the right hon. and gallant Gentleman the Member for the Scottish Universities (Lieut.-Colonel Elliot). I think we all enjoyed his speech. As to form, it was of high quality: as to matter, not quite so high. No doubt, however, he may take it as a compliment that his party invited him on the first occasion after his return to this House to bat on such a very sticky wicket. I am also bound to say that he, rather wisely as I thought, disclaimed any special knowledge of the subject.

If we were to have a Member for Scottish Universities speaking on this subject, it seems strange to me that the senior Member for the Scottish Universities (Sir J. Anderson), who was Lord President of the Council and Chancellor of the Exchequer in the Coalition Government, was not invited by his party to speak. Of course, it would have been particularly interesting for the House, because the right hon. Gentleman in the course of the General Election declared himself in favour of the nationalisation of the distribution of electricity.

There are other omissions, which I regret, from the list of speakers. There is the right hon. Gentleman the Member for the City of London (Sir A. Duncan), who played a distinguished part as Chairman of the Central Electricity Board. I think we should all have enjoyed hearing his views and having the benefit of his great experience of the workings of a public corporation. He might have been able to tell us whether he himself thought there was anything wrong with the idea of public boards. Then there is the right hon. and gallant Gentleman the Member for Pembroke (Major Lloyd-George), the late Minister of Fuel and Power. As is well known, the Coalition Government gave much attention to this problem. Statements to that effect were made in another place. Yet we have not had the benefit of his advice. I think it is very unfortunate that we could not enjoy his views on this important matter.

Then there is the right hon. Gentleman the Member for Southport (Mr. R. S. Hudson)—a man also of wide Ministerial experience but not, I think, of any great Ministerial experience in the field of electricity. It is true that he has a somewhat dynamic personality and it may be said that he generates heat, in which respect perhaps he resembles my right hon. Friend the Minister. As for any particular knowledge of the electricity industry, I think that the only point that he could claim was that he had been, 20 years ago, a Member of the Standing Committee on the 1926 Bill. I am told that at that time Conservative Members of that Committee were divided into two groups. [HON. MEMBERS:"HOW do you know?"] I said "I am told." Perhaps hon. Members would do me the courtesy of listening to what I say. I am told that the Conservative Members of that Committee were divided into two groups—the undertakers and the mutes. I am glad to be able to tell the House that the right hon. Gentleman was one of the mutes.

Mr. R. S. Hudson

As the hon. Member has referred to me, he had better consult his own Leader and ask whether I was a mute, or whether I took an active part in actually promoting the particular Clauses of the Bill which are the foundation of a great deal of the progress which has been made.

Mr. Gaitskell

If the light hon. Gentleman had waited a moment, he would have found that I was going to explain to the House that the term "mute" meant that he was supporting the Government, unlike the undertakers. [HON. MEMBERS: "What about the Bill?"] I hope hon. Members will be a little patient. I wish to start with a reference to a number of specific questions soliciting information which have been put to me in the course of the Debate. I frankly say that it is impossible to answer all these tonight. Most of them, however, will in any case come up during the Committee stage of the Bill.

The hon. Member for Stratford (Mr. H. Nicholls) made a most admirable maiden speech, and the hon. Member for Houghton-le-Spring (Mr. Blyton), and, I think, one or two others, suggested that the consultative councils were not large enough for some of the areas, and also put forward proposals that they should be composed exclusively of representatives of the local authorities. We have made provision in the Bill, in Clause 7 (8), for schemes of local committees to be put forward by these consultative councils, and I have not the slightest doubt that, in many cases, they will make use of those powers. Secondly, I think we must recognise that, valuable as is the work done by local authorities, nevertheless, we cannot regard them as in every way representing every type of electricity consumer. They do not, as it happens, represent very well the industrial consumers of electricity, and, in some instances, where company undertakings have operated, it can be said that local authorities have not had much experience in the field of electricity.

I was also asked about the negotiating machinery between the Boards and the unions, and I want to say emphatically, in answer to the senior hon. Member for Dundee (Mr. Cook), that recent agreements which have been made will be honoured, just as in the case of the coal industry. Further, the joint industrial councils will continue, though discussions will no doubt be necessary between the unions and the Boards as to the modifications which may be desirable in the light of the changes made by the Bill. I can assure the hon. Member that we have discussed this problem with the unions concerned, and, so far as I am aware, they are very satisfied with the Clause as drafted. Should there be any desire to look into the matter further, we are perfectly willing to meet them.

The noble Lord the Member for South Dorset (Viscount Hinchingbrooke), in a very elegant speech, though highly in- accurate in places, asked about research in relation to existing organisations. Clause 2 of the Bill specifically provides, not only that the Central Authority shall conduct research itself into matters affecting the supply of electricity, but also that it shall assist other persons conducting such research, and it is intended, therefore, that, if the Board desires, and considers that the research associations to which the noble Lord refers are doing good work, they can support those associations. As regards the research work of the companies themselves, if they are electric supply companies, they will be taken over. I think the noble Lord probably realises that most of the research in this field is, in fact, conducted by the manufacturers of electrical equipment, and that does not come into the Bill at all. The hon. Member for Buckrose (Mr. Wadsworth) asked about the area boards competing with small traders. Existing electrical undertakings sell and hire domestic equipment, and we have not the slightest intention of depriving the area boards of the right to do the same thing, but the consumer will be perfectly free, if he so desires to go elsewhere to get his supplies. He can go where he will get the best service and the best prices, from his own point of view. I am sure that the Liberal Party will agree that healthy competition of this kind is most desirable.

Finally, the hon. Member for Stockport (Sir A. Gridley) asked me a series of questions, to which I will now reply. He asked me about Clause 13 (2) (b) and suggested that there might be a case where a holding company, although holding 75 per cent. of its assets in electricity undertakings, nevertheless, had control of none. There may be such cases, though we do not know of any. It is our intention, of course, to take over holding companies which have a controlling interest in subsidiaries. If there were a case where it could be shown that a company would be caught by the Clause as at present drafted, even though it had no controlling interest whatever in any authorised undertaking, we should be happy to consider a suitable Amendment to exclude such a case. Secondly, the hon. Member for Stockport also asked for an assurance, which I readily give, that my right hon. Friend did not cast any imputation against him personally, or, indeed, against his company, in the matter of certain practices of holding companies. It so happened, I think by coincidence, that the reference to his company, which related to bonus share issues, came fairly close to the other matter of the possible abuses of holding companies to which my right hon. Friend referred. My right hon. Friend has asked me to say that he had no intention of casting any imputations against the hon. Member.

With regard to the hon. Member's further question about the Central Electricity Board, the Board is, of course, not merely mentioned in the Bill, but mentioned several times. It is an authorised undertaker, and, as such, is covered by all the Clauses affecting such undertakers, and there are special references to it, in addition. Finally, he asked me whether we had consulted the Central Electricity Board in the drafting of this Bill. It is not, I think, the practice of the Government, for very good reasons in my view, and, indeed, not the practice of any Government, to disclose precisely with whom they have consulted before they bring a Bill to this House. The reason is that it is undesirable that bodies, such as the Central Electricity Board, should become involved in party politics. I can, however, tell the hon. Member that informal conversations with certain individuals, as individuals, have taken place.

I would now like to turn to the fundamental issues raised in this Debate.

Colonel J. R. H. Hutchison

I would like the Parliamentary Secretary to answer the material and important point as to the non-statutory bodies, because the Bill makes no provision for them at all.

Mr. Gaitskell

The answer is that that is quite deliberate. It is not intended to interfere with non-statutory undertakings. As the hon. and gallant Member knows, they can supply not only themselves, but, if they wish, and if they are able to compete successfully with the undertakers and area boards, may continue to supply consumers.

The first fundamental issue is. Must we do anything at all? Can we leave things as they are? In my opinion, my right hon. Friend made out a very powerful case for the view that action must be taken. I am bound to say that the case which he made out has not been weakened by anything said in this Debate. That is not surprising because the facts are beyond dispute. I am bound to say, however, that I am a little disappointed at the uncertainty and the vagueness of the Opposition's attitude in this matter. Some hon. Gentlemen and right hon. Gentlemen seemed to do no more than pay lip service to the view that, of course, reorganisation was necessary. Others, better informed, were prepared to go into rather more detail. I think that we had better assume, at any rate, that the Conservative Party, as before the war, still broadly supports the recommendation of the McGowan Report, and at least stands by the 1937 White Paper.

I do not wish to weary the House with quotations from these documents, but I wish to quote a few words from the McGowan Report because, as I shall hope to show, it is of great importance in enabling us to make up our minds on this issue. First, the Report states in paragraph 84: In all the circumstances, and having regard to the evidence placed before us, there can, in our opinion, be no question that an improvement in the present organisation can and must be effected. Secondly, it specified the essential objects, as they were described, as follows: first, a substantial reduction in the present number of undertakings by the substitution, where appropriate, of larger and more economic units; secondly, the prevention of the splitting up of comprehensive undertakings in consequence of the exercise of rights of purchase by individual local authorities; thirdly, the elimination of duplicate powers wherever they exist in the same area. Why were the McGowan Committee so much impressed with the desirability of larger areas? They, in fact, listed five great advantages which they thought would accrue from a change of this kind. These advantages were: improved technical layout and economy in capital expenditure, diversity of load, better financial resources, central purchasing, and personnel. Those were the five major results which they believed would accrue from a change of this kind. I emphasise that fact, because it is from these changes that we believe great technical improvements will result from our Bill. When hon. Members opposite ask how we can show that there is to be any cheapening of supplies to consumers as a result of the Bill, we must point to the McGowan Report. I would describe it as the Report not of a fully expert committee but, at least, of a semi-expert body.

There is one further point. We have taken the view that we cannot wait any longer, and we do so for two reasons. In the first place, as my right hon. Friend has pointed out, the local authorities are now in a position to exercise franchise rights over a very wide field indeed, and, secondly, in the course of the next few years—five or 10 years—there is bound to be in this field of electricity very considerable development and very heavy capital expenditure. We regard it as essential that we should make these changes, because if we do not we shall, in fact, be imposing unnecessary waste on the country. We shall be permitting the maintenance and extension of an uneconomic and wasteful system of electricity distribution. There is no doubt that, whatever Government had been in power, if they had had the country's interest at heart, they would have been bound to intraduce some Bill to reorganise the electricity industry now.

I do not propose to say much about generation. Little attention has been paid to this subject in the Debate, and I think it is generally agreed that the present system, under which the Central Electricity Board controls but does not own the selected stations, is most unsatisfactory. Some very good arguments to that end were put forward by my hon. Friends the Members for Wimbledon (Mr. Palmer) and North Wembley (Mr. Hobson). We really cannot go on with this extraordinary system of "refined horse dealing," as it was once described to me, which the Central Electricity Board has had to carry on with the owners of selected stations, because 21 years ago there was a Tory back bench revolt in which, incidentally, the "mutes" were defeated.

I now turn to the major issue of the Debate—the form of the organisation for distribution. We take the view that the case for public boards in this field is overwhelming, for these reasons. First, the electricity supply business is, inevitably, in practically every case a monopoly, and it is our general attitude that monopolies, whether they are formed naturally or for special purposes, are particularly suitable for public ownership. There are very good reasons for that, because whatever may be the effectiveness of the profit motive when it comes to competitive enterprise, it is certainly not the same when it comes to a monopoly. High profits under monopolies are all too frequently the result, not of efficiency, not of low costs, but of high prices, and the absence of competition makes it all the more desirable and all the more essential that there should be supervision.

At one time I had hoped that we would have the support of hon. Members opposite in this matter. No less a man than the right hon. Gentleman the Member for Woodford (Mr. Churchill), when he broadcast—[HON. MEMBERS: "Oh."] Hon. Members opposite should be more respectful to their Leader. On 21st March. 1943, he spoke of the broadening field for State ownership and enterprise, especially in relation to monopolies of all kinds. I have often wondered what he had in mind on that occasion. Apparently it was not transport. Perhaps it was gas. But if gas, why not electricity? If it was none of those things, perhaps some day he will tell us what he did have in mind. I can assure him, and hon. Members opposite generally, that we should all be very interested to know what are these other fields for the extension of public ownership and control. We shall shortly be coming towards the end of our, immediate nationalisation programme, and we shall be considering in what direction to move again. We should be very happy to have his advice on that.

Mr. Osborne

Transport House.

Mr. Gaitskell

There are, of course, other reasons, too, why the organisation of distribution should be a public service. This has, indeed, been the view of Parliament, expressed again and again, over the past 60 years. Municipal enterprise, which has been so much supported, perhaps rather surprisingly, by hon. Members opposite—they do not always support municipal enterprise—is recognised in this field as having been highly efficient. The Central Electricity Board, so far as I know, is recognised as a most successful public undertaking. Even the McGowan Report proposed that eventually there should be public ownership after 50 years. Why after 50 years? Why not now? Again, in this industry there is special importance to be attached to capital charges, amounting, as they do, to somewhere between 40 per cent. and 50 per cent. of the total costs. Surely, it is clear to hon. Members opposite that if capital charges are very high there is a strong case for borrowing money on the lowest possible terms? We shall get the lowest possible terms by State guaranteed loans.

The McGowan Report raised one or two objections. First, the familiar objection, repeated again and again by hon. Members opposite, that it would cause dislocation. My right hon. Friend dealt with that very effectively. Here we have the great coal industry, extremely complicated in character, with many day-to-day production problems, which has passed into public ownership without any sign whatever of any dislocation.—[Laughter.]—Hon. Members opposite are laughing to keep up their courage. The truth is, the dislocation argument is the last refuge of the reactionary. I have no doubt at all that when King John, faced with hordes of angry barons at Runnymede, was asked to sign Magna Carta, he said, "Gentleman, this will cause terrible dislocation."

The second argument of the McGowan Report was that the compensation provisions would give rise to uncertainty. Whatever may be said about our compensation provisions, it cannot be said that they will give rise to any uncertainty. I think that the stockholders know exactly where they stand, and I shall hope to say a word or two about that later. Finally, the McGowan Report put forward the astonishing argument that they would not recommend public boards unless the industry was hopelessly inefficient. This is quite irrelevant. There may be cases where industries are very inefficient but where, nevertheless, we should not regard public ownership as at all a suitable solution to the problem. There may be other industries which are efficient but which can, nevertheless, be made far more efficient by public ownership. That we believe to be the case with electricity supplies.

Little has been said in the Debate about the alternative to public ownership, but one must make the best one can of it, and proceed on the basis of the 1937 White Paper. What is our objection to that? Firstly, I do not think it can really be sustained that the approach made by the prewar Conservative Government to this problem was at all likely to lead to the right size of area. The 1937 Report had an appendix setting out the provisional views of the Electricity Commissioners as instructed by the Government of the time. There were, I think, 121 separate districts listed there, and we take the view that that is far too many if we are to reap properly the economies which can be reaped by large scale distribution. It is perfectly true that the question of the size of area is, to a large extent, a technical one. It is not something on which we have had a little party together, my right hon. Friend and myself with a few of our colleagues, and have decided that we will treat the matter like this. That is not the way we have gone about it. We have consulted technical opinion on this matter and—I am not putting the responsibility for this on the technical experts, that would be very wrong, because it is our responsibility—I want to assure the House that we have come to this conclusion in no light-hearted manner, because it is of immense importance.

At the present moment some of the companies control very wide areas. For instance, the North Eastern Supply Company, which claims with some justification to be a highly efficient company, controls, an area of 6,000 square miles. That is slightly above the average of our areas. Edmondson's, which equally claim—I think with justification—to be efficient, control no less than 16,000 square miles, scattered all over the country, it is true; I think all would agree they would be far more efficient if it were not so. Therefore, we are bound to take the view that, if we are to have the areas which from the technical point of view are of the right size, we cannot adopt local authority boundaries. We must accept that, and any honest person looking at this problem from the point of view of how to provide the best electricity service for the country must recognise that it cannot be done on the basis of local authority areas. Therefore, we are driven to something larger, we are driven to the idea of regional public boards. I think many hon. Members opposite would probably go a long; way with me in this argument. What, then, is the difference between us?—a difference which, I am bound to say, it sometimes seems to me, has been greatly exaggerated in the rather virulent speeches made by one or two hon. Members opposite. One difference is that we do not propose to maintain the companies. But hon. Members opposite are not consistent in this matter. If they are really concerned at the elimination of private companies, if they really believe that private monopoly is the best way of distributing electricity, why do they stop short? Why do they not recommend that we should have private monopolies everywhere in this industry, and hand the whole thing over to the private companies? For instance, why should—as, I think, was the proposal in the 1937 White Paper-South London be handed over to a private company and North London be left in what, apparently, hon. Members opposite would regard as the less efficient municipalities? There is no consistency in their attitude.

The real point is that the McGowan' Report in this matter was essentially, political. It was a political document in those paragraphs, based on the political situation. That situation has altered. The fact that it has altered has already-been recognised by the Heyworth Com- mittee which, facing a very similar problem for the gas industry, has recommended, in effect, what we are putting into this Bill. The alternative proposal, which, so far as one can gather, is what hon. Members opposite favour, is a weak, shuffling, shabby expedient to avoid a clash with vested interests. It would not secure the economies which can be achieved, it would not provide the necessary permanence, and it is not, in our opinion, a satisfactory basis on which to establish a sound electricity supply industry.

I turn now to some of the major issues raised in the Debate and connected with the details of the Bill. Much has been made by hon. Members opposite about the lack of protection for consumers. The hon. Member for Wavertree made some play on that in his speech. What are the facts? How much protection have consumers had in the past? They have had certain Statutory rights regarding supplies. Most of those rights remain. They are not affected by the various alterations which we propose to make in the Schedules to the Bill. There are some alterations which have been made because the points are covered elsewhere in the Bill. Substantially, however, where we thought that the protection was of any value whatever, we have retained it, either in the existing legislation or in the Bill.

Reference was made to prices. No honest man can possibly maintain that in this field there has been any effective price control. Those who have been concerned with the industry know that perfectly well. It is true there were maximum prices in special Orders. What were the maximum prices? Hon. Members may be interested to know that, in practically every case, the maximum price was 9d., 10d., or is, a unit. What possible use is that as a form of consumers' protection? In any case, it does not in the least deal with what is the most common form of charge, the two-part tariff, which is a private agreement made between a company and a consumer, and is quite unaffected by the Statutory provisions. Instead of that, we now have public authorities providing services, not for profit, but on a basis of cost. We do not claim that no protection is needed for the consumers, but we do claim that the consumers are in very much less danger than they were from private monopoly, and we propose the setting up of consultative councils, not merely to protect the consumer in the narrower sense, but to participate in the planning of the electricity supply for the whole area. We want them to work extremely closely with the area boards, and one reason we think that will be possible is that we have introduced this overlapping, so that the chairman of the consultative council is, in fact, a member of the area board.

Much, reference has been made to Ministerial powers. The Opposition objection seemed rather weak. They have not specified, except in one or two instances, what they object to. It is true they have asked in what circumstances the Minister would decline to allow a direction which he gave to the Central Authority to be published. There may well be strategical considerations in this matter which would make it most undesirable to publish, as responsible right hon. Gentlemen opposite know perfectly well. I have no reason to believe that the powers in the Bill are excessive.

What do the Opposition want in this matter? My right hon. Friend is entitled to some explanation. Do they wish public undertakings to be quite outside Parliamentary control? In that case, my right hon. Friend might be prepared to consider giving up some of these powers, but in that case they must not go on questioning him.

I wish I had time to answer some of the extraordinary and inaccurate statements made by the right hon. Member for Southport on the matter of compensation. He really is quite extraordinary. One would suppose that, as it is some time since he has been removed from agriculture, he would be able to find out the facts. He stated that the value of shares in the pre-Election period was higher than in the period immediately preceding the Bill. The facts are entirely the contrary. The values were, as a matter of fact, £17 million higher in the latter period than in the earlier period. The right hon. Member is reflecting seriously on many of his colleagues when he suggests that the Stock Exchange does not take into account the reserves of an undertaking or what its prospects are. I see the hon. and gallant Member for Holderness (Lieut.-Commander Braithwaite) there. Are we really to suppose that the hon. and gallant Member advises his clients without taking into account such considerations? I think that he and others are much too fly and much too sly to be caught in that way.

There are three courses open to us. We can take the easy way out and have no legislation at all. That leads to chaos. We can adopt the timid, opportunist, half-hearted policy so characteristic of the Conservative Party in their prewar days, or we can adopt the obviously sensible solution propounded in the Bill. We can convert the industry into a public

service, with regional boards responsible for administration from day to day, with consultative councils to keep the consumers in the closest touch with the various local authorities in the area and with a Central Authority concerned with the coordination of policy. We believe that this is the clean and sensible way to do the job, and that it will give us an efficient electrical supply industry. For those reasons I now ask the House to give the Bill a Second Reading.

Question put, "That 'now' stand part of the Question."

The House divided: Ayes, 340; Noes, 165.

Division No. 68.]	AYES.	10 p.m.
Adams, Richard (Balham)	Comyns, Dr. L.	Greenwood, Rt. Hon. A. (Wakefield)
Adams, W. T. (Hammersmith, South)	Cook, T. F.	Greenwood, A. W. J. (Heywood)
Alexander, Rt. Hon. A. V.	Cooper, Wing-Comdr. G.	Grenfell, D. R.
Allen, A. C. (Bosworth)	Corbet, Mrs. F. K. (Camb'well, N.W)	Grierson, E.
Allen, Scholefield (Crews)	Corlett, Dr. J.	Griffiths, D. (Rother Valley)
Alpass, J. H.	Cove, W. G.	Griffiths, Rt. Hon. J. (Llanelly)
Anderson, A. (Motherwell)	Crawley, A.	Griffiths, W D. (Moss Side)
Anderson, F. (Whitehaven)	Crossman, R. H. S	Gunter, R. J.
Attewell, H. C.	Daines, P.	Guy, W. H.
Attlee, Rt. Hon. C. R.	Dalton, Rt. Hon. H.	Haire, John E. (Wycombe)
Austin, H. Lewis	Davies, Clement (Montgomery)	Hale, Leslie
Awbery, S. S.	Davies, Edward (Burslem)	Hall, W. G.
Ayles, W. H.	Davies, Ernest (Enfield)	Hamilton, Lieut.-Col. R
Ayrton Gould, Mrs. B.	Davies, Harold (Leek)	Hardman, D. R.
Bacon, Miss A.	Davies, Hadyn (St. Pancras, S.W.)	Hardy, E. A.
Baird, J.	Davies, R. J. (Westhoughton)	Harrison, J.
Balfour, A.	Davies, S. O. (Merthyr)	Hastings, Dr. Somerville
Barnes, Rt. Hon. A. J.	Deer, G.	Henderson, A. (Kingswinford)
Barstow, P. G.	Delargy, Captain H. J,	Henderson, Joseph (Ardwick)
Barton, C.	Diamond, J.	Herbison, Miss M.
Battley, J. R.	Dobbie, W.	Hewitson, Capt. M.
Bechervaise, A. E	Dodds, N. N.	Hicks, G.
Belcher, J. W.	Donovan, T.	Holman, P.
Bellinger, Rt. Hon. F. J	Drlberg, T. E. N.	Holmes, H. E. (Hemsworth)
Benson, G.	Dugdale, J. (W. Bromwich)	House, G.
Berry, H.	Durbin, E. F. M.	Hoy, J.
Bevan, Rt. Hon. A. (Ebbw Vale)	Dye, 8.	Hubbard, T.
Bing, G. H. C.	Ede, Rt. Hon. J. C.	Hudson, J. H. (Ealing, W.)
Blackburn, A. R.	Edelman, M.	Hughes, Hector (Aberdeen, N.)
Blenkinsop, A.	Edwards, John (Blackburn)	Hughes, H. D. (W'lverh'pton, W.)
Blyton, W. R.	Edwards, N. (Caerphilly)	Hutchinson, H. L. (Rusholme)
Boardman, H.	Edwards, W. J. (Whitechapel)	Hynd, H. (Hackney, C.)
Bowden, Flg.-Offr. H. W.	Evans, E. (Lowestoft)	Irving, W. J.
Bowles, F. G. (Nuneaton)	Evans, John (Ogmore)	Isaacs, Rt. Hon. G. A
Braddock, Mrs. E. M. (L'pl, Exch'ge)	Evans, S. N. (Wednesbury)	Janner, B.
Braddock, T. (Mitcham)	Ewart, R.	Jay, D. P. T.
Bramall, Major E. A.	Fairhurst, F.	Jeger, G. (Winchester)
Brook, D. (Halifax)	Farthing, W. J.	Jeger, Dr. S. W. (St. Pancras, S.E.)
Brown, George (Belper)	Field, Capt. W. J.	Jones, Rt. Hon. A. C. (Shipley)
Brown, T. J. (Ince)	Fletcher, E. G. M. (Islington, E.)	Jones, D. T. (Hartlepools)
Brown, W. J. (Rugby)	Follick, M.	Jones, Elwyn (Plaistow)
Brucs, Maj. D. W. T.	Foot, M. M.	Jones, P. Asterley (Hitchin)
Buchanan, G.	Forman, J. C.	Keenan, W.
Burden, T. W.	Foster, W. (Wigan)	Kenyon, C.
Burke, W. A.	Fraser, T. (Hamilton)	Key, C. W.
Butler, H. W. (Hackney, S.)	Freeman, Maj. J. (Watford)	King, E. M.
Byers, Frank	Freeman, Peter (Newport)	Kinley, J.
Carmichael, James	Gaitskell, H. T. N.	Kirby, B. V.
Castle, Mrs. B. A	Gallacher, W.	Kirkwood, D.
Champion, A. J.	Ganley, Mrs. C. S.	Lang, G.
Chater, D.	George, Maj. Rt. Hn. G. Lloyd (P'ke)	Lavers, S.
Chetwynd, G R.	George, Lady M. Lloyd (Anglesey)	Lee, F. (Hulme)
Cocks, F. S	Gibbins, J.	Lee, Miss J. (Cannock)
Coldrick, W.	Gibson, C. W.	Leonard, W.
Collick, P.	Gilzean, A.	Lever, N. H.
Collindridge, F.	Glanville, J. E. (Consett)	Levy B. W.
Collins, V. J.	Gooch, E. G.	Lewis, J. (Bolton)
Colman, Miss G. M.	Goodrich, H. E.	Lewis, T. (Southampton)
Lindgren, G. S.	Parker, J	Strachey, J.
Lipson, D. L.	Parkin, B. T	Strauss, G. R. (Lambeth, N.)
Lipton, Lt.-Col, M.	Paton, Mrs. F. (Rusbcliffe)	Stross, Dr. B.
Logan, D. G.	Paton, J. (Norwich)	Stubbs, A. E.
Longden, F.	Pearson, A.	Summerskill, Dr. Edith
Lyne, A. W.	Peart, Capt. T. F.	Symonds, A. L.
MeAdam, W.	Platts-Mills, J. F. F.	Taylor, H B. (Mansfield)
McAllister, G.	Poole, Major Cecil (Lichfield)	Taylor, R. J. (Morpeth)
McEntee, V. La T	Porter, E. (Warrington)	Taylor, Dr. S. (Barnet)
McGhee, H. G.	Porter, G. (Leeds)	Thomas, I. O. (Wrekin)
MeGovern, J.	Price, M. Philips	Thomas, John R. (Dover)
Mack, J. D.	Proctor, W. T.	Thomson, Rt. Hon. G. R. (Ed'b'gh, E.)
McKay, J. (Wallsend)	Pursey, Cmdr. H	Thorneycroft, Harry (Clayton)
Mackay, R. W. G. (Hull, N.W.)	Randall, H. E.	Thurtle, E.
McKinlay, A. S.	Ranger, J.	Tiffany, S.
Maclean, N. (Govan)	Rankin, J.	Titterington, M. F
McLeavy, F.	Rees-Williams, D. R.	Tolley, L.
MacMillan, M. K. (Western Isles)	Reeves, J.	Tomlinson, Rt. Hon. G
McNeil, Rt. Hon. H.	Reid, T. (Swindon)	Turner-Samuels, M.
Macpherson, T. (Romford)	Rhodes, H.	Ungoed-Thomas, L.
Mallalieu, J. P. W.	Richards, R.	Usborne, Henry
Mann, Mrs. J.	Ridealgh, Mrs. M.	Vernon, Maj. W. F
Manning, C. (Camberwell, N.)	Robens, A.	Viant, S. P.
Manning, Mrs. L. (Epping)	Roberts, Emrys (Merioneth)	Wadsworth, G
Marshall, F. (Brightside)	Roberts, Gorohwy (Caernrvonshire)	Walkden, E.
Mathers, G.	Roberts, W. (Cumberland, N.)	Wallace, G D. (Chislehurst)
Mayhew, C. P.	Robertson, J. J. (Berwick)	Wallace, H. W. (Walthamstow, E.)
Medland, H. M.	Rogers, G. H. R.	Warbey, W. N.
Mellish, R. J.	Ross, William (Kilmarnock)	Watson, W. M.
Middleton, Mrs. L	Royle, C.	Webb, M. (Bradford, C.)
Mikardo, Ian	Sargood, R.	Weitzman, D.
Millington, Wing-Comdr. E. R.	Scollan, T.	Wells, W. T. (Walsall)
Mitchison, Maj. G. R.	Scott-Elliot, W.	West, D. G.
Monslow, W.	Shackleton, Wing.-Cdr. E. A. A	Westwood, Rt. Hon. J
Montague, F.	Sharp, Granville	Wigg, Col. G. E.
Moody, A. S.	Shawcross, C. N. (Widnes)	Wilcock, Group-Capt. C. A B.
Morgan, Dr. H B	Shawcross, Rt. Hn. Sir H. (St. Helens)	Wilkes, L.
Morley, R.	Shinwell, Rt. Hon. E.	Wilkins, W. A.
Mort, D. L.	Shurmer, P.	Willey, O. G. (Cleveland)
Moyle, A.	Silkin, Rt. Hon. L.	Williams, Rt. Hon. T. (Don Valley)
Murray, J. D.	Silverman, J. (Erdington)	Williams, W. R (Heston)
Nally, W.	Silverman, S. S. (Nelson)	Williamson, T.
Naylor, T. E.	Simmons, C. J.	Willis, E.
Neal, H. (Claycross)	Skeffington A. M	Wills, Mrs. E. A
Nicholls, H. R. (Stratford)	Skeffington-Lodge, T. C	Witmot, Rt. Hon. J
Noel-Baker, Capt. F. E. (Brentford)	Smith, C. (Colchester)	Wilson, J. H.
Noel-Baker, Rt. Hon. P J. (Derby)	Smith, Ellis (Stoke)	Wise, Major F J
Noel-Buxton, Lady	Smith, S H. (Hull, S.W.)	Woodburn, A.
O'Brien, T.	Snow, Capt. J. W	Woods, G. S.
Oldfield, W. H	Solley, L. J.	Wyatt, W.
Oliver, G. H.	Sorensen, R. W.	Yates, V. F.
Orbach, M.	Soskice, Maj. Sir F.	Young, Sir R. (Newton)
Paget, R T.	Sparks, J. A.	Younger, Hon. Kenneth
Paling, Rt. Hon. Wilfred (Wentworth)	Stamford, W.	Zilliacus, K.
Palmer, A. M. F.	Stephen, C.
Pergiter, G. A.	Stewart, Michael (Fulham, E.)	TELLERS FOR THE AYES.
		Mr. Hannan and Mr. Popplew ll.
NOES.
Agnew, Cmdr. P. G.	Crookshank, Capt. Rt. Hon. H. F C.	Gridley, Sir A.
Aitken, Hon. Max	Crosthwaite-Eyre, Col. O. E.	Grimston, R. V.
Amory, D. Heathcoat	Crowder, Capt. John E.	Hannon, Sir P. (Moseley)
Anderson, Rt. Hon. Sir J. (Scot. Univ.)	Cuthbert, W. N.	Hare, Hon. J. H. (Woodbridge)
Assheton, Rt. Hon. R	De la Bare, R	Harvey, Air-Comdre. A. V.
Baldwin, A. E.	Digby, S. W.	Haughton, S G.
Barlow, Sir J.	Dodds-Parker, A. D.	Headlam, Lieut.-Col Rt. Hon. Sir C.
Beechman, N. A.	Donner, Sqn.-Ldr. P. W	Henderson, John (Cathcart)
Birch, Nigel	Drayson, G. B	Hogg, Hon. Q.
Boles, Lt.-Col. D. C. (Wells)	Drewe, C.	Hollis, M. C.
Boothby, R.	Dugdale, Maj. Sir T. (Richmond)	Hope, Lord J.
Bossom, A. C.	Duncan, Rt. Hn. Sir A. (City of Lond.)	Howard, Hon. A.
Boyd-Carpenter, J. A.	Duthie, W. S.	Hudson, Rt. Hon. R. S. (Southport)
Braithwaite, Lt.-Comdr. J. G.	Eccles, D. M.	Hurd, A.
Bromley-Davenport, Lt.-Col. W	Eden, Rt. Hon. A.	Hutchison, Col. J.R. (Glasgow, C.)
Bullock, Capt. M.	Elliot, Rt. Hon. Walter	Jarvis, Sir J.
Butcher, H. W.	Fleming, Sqn.-Ldr. E. L.	Jeffreys, General Sir G.
Butler, Rt. Hon. R. A. (S'ffr'n W'ld'n)	Fletcher, W. (Bury)	Jennings, R.
Carson, E.	Foster, J. G. (Northwich)	Joynson-Hicks, Lt.-Cdr. Hon. L. W.
Channon, H.	Fraser, Sir I. (Lonsdale)	Kerr, Sir J Graham
Clarke, Col. R. S.	Fyfe, Rt. Hon. Sir D. P. M	Kingsmill, Lt.-Col. W. H.
Clifton-Brown, Lt.-Col. G	Gage, C.	Lambert, Hon. G.
Cole, T. L.	Galbraith, Cmdr. T. D	Lancaster, Col. C. G.
Conant, Maj. R. J. E.	Glossop, C. W. H.	Langford-Holt, J.
Cooper-Key, E. M.	Glyn, Sir R.	Law, Rt. Hon. R. K.
Corbett, Lieut-Col. U. (Ludlow)	Grant, Lady	Legge-Bourke, Maj. E. A. H

Lennox-Boyd, A. T.	Nicholson, G.	Spearman, A. C. M.
Linstead, H. N.	Nield, B. (Chester)	Stanley, Rt. Hon. O.
Lloyd, Maj. Guy (Renfrew, E.)	Noble, Comdr. A. H. P.	Stewart, J. Henderson (Fife, E.)
Lucas-Tooth, Sir H.	Nutting, Anthony	Stoddart-Scott, Cot. M.
Lyttelton, Rt. Hon. O.	O'Neill, Rt. Hon. Sir H.	Strauss, H. G. (English Universities)
MacAndrew, Col. Sir C	Orr-Ewing, I. L.	Sutcliffe, H.
McCallum, Maj. D.	Osborne, C.	Taylor, C. S. (Eastbourne)
MacDonald, Sir M. (Inverness)	Peake, Rt. Hon. O.	Thomas, J. P. L. (Hereford)
Macdonald, Sir P. (I of Wight)	Peto, Brig. C. H. M.	Thorneycroft, G. E. P. (Monmouth)
Mackeson, Brig. H. R.	Pickthorn, K.	Thornton-Kemsley, C. N.
McKie, J. H. (Galloway)	Pitman, I. J.	Thorp, Lt.-Col. R. A. F.
Maclay, Hon. J. S.	Poole, O. B. S. (Oswestry)	Touche, G. C.
MacLeod, J.	Price-White, Lt.-Col. D.	Turton, R. H.
Macpherson, Maj. N. (Dumfries)	Raikes, H. V.	Vane, W. M. F.
Maitland, Comdr. J. W.	Ramsay, Maj. S.	Walker-Smith, D.
Manningham-Buller, R. E.	Rayner, Brig. R.	Ward, Hon. G. R.
Marlowe, A. A. H.	Reed, Sir S. (Aylesbury)	Watt, Sir G. S. Harvie
Marsder, Capt. A.	Reid, Rt. Hon. J. S. C. (Hillhead)	Webbe, Sir H. (Abbey)
Marshall, D. (Bodmin)	Renton, D.	Wheatley, Colonel M. J.
Marshall, S. H. (Sutton)	Roberts, H. (Handsworth)	White, Sir D. (Fareham)
Maude, J. C.	Roberts, Maj. P. G. (Ecclesall)	Williams, C. (Torquay)
Medlicott, F.	Robinson, Wing-Comdr. Roland	Williams, Gerald (Tonbridge)
Mellor, Sir J.	Ropner, Col. L.	Willink, Rt. Hon. H. U.
Molson, A. H. E.	Sanderson, Sir F.	Willoughby de Eresby, Lord
Moore, Lt.-Col. Sir T.	Savory, Prof. D. L	Winterton, Rt. Hon. Earl
Morris-Jones, Sir H.	Scott, Lord W	Young, Sir A. S. L. (Partick)
Morrison, Maj. J. G. (Salisbury)	Shephard, S. (Newark)
Morrison, Rt. Hon. W. S. (Cirenoester)	Shepherd, W. S. (Bucklow)	TELLERS FOR THE NOES:
Mott-Radclyffe, Maj. C. E.	Smith, E. P. (Ashford)	Mr. James Stuart and
Mullan, Lt. C. H.	Snadden, W. M.	Mr. Buchan-Hepburn.

Bill accordingly read a Second time.

Mr. R. S. Hudson (Southport)

I beg to move, "That the Bill be committed to a Committee of the Whole House."

Question put.

The House divided: Ayes, 169; Noes, 330.

Division No. 69.]	AYES.	[10.11 p.m
Agnew, Cmdr. P. G.	Fletcher, W. (Bury)	Macdonald, Sir P. (I. of Wight)
Aitken, Hon. Max	Foster, J. G. (Northwich)	Mackeson, Brig. H. R.
Amory, D. Heathcoat	Fyfe, Rt. Hon. Sir D. P. M.	Mckie, J. H. (Galloway)
Assheton, Rt. Hon. R	Gage, C.	Maclay, Hon. J. S.
Baldwin, A. E.	Galbraith, Cmdr. T. D.	MacLeod, J.
Barlow, Sir J.	George, Lady M. Lloyd (Anglesey)	Macpherson, Maj. N. (Dumfries)
Beechman, N. A.	Glossop, C. W. H.	Maitland, Comdr. J. W.
Birch, Nigel	Glyn, Sir R.	Manningham-Buller, R. E
Boles, Lt.-Col. D. C. (Wells)	Grant, Lady	Marlowe, A. A. H.
Boothby, R.	Gridley, Sir A.	Marsden, Capt. A.
Bossom, A. C.	Grimston, R, V.	Marshall, D. (Bodmin)
Boyd-Carpenter, J. A.	Hannon, Sir P. (Moseley)	Marshall, S. H. (Sutton)
Braithwaite, Lt.-Comdr. J. G.	Hare, Hon. J. H. (Woodbridge)	Maude, J. C.
Bromley-Davenport, Lt.-Col. W	Harvey, Air-Comdre, A. V.	Medlicott, F.
Bullock, Capt. M.	Haughton, S. G.	Mellor, Sir J.
Butcher, H. W.	Headlam, Lieut.-Col. Rt. Hon. Sir C	Molson, A. H. E.
Butler, Rt. Hon. R. A. (S'ffr'n W'ld'n)	Henderson, John (Catheart)	Morris-Jones, Sir H.
Byers, Frank	Hinchingbrooke, Viscount	Morrison, Maj. J. G. (Salisbury)
Carson, E.	Hogg, Hon. Q.	Morrison, Rt. Hon. W. S. (Cirencester)
Challen, C.	Hollis, M. C.	Mott-Radclyffe, Maj. C. E.
Channon, H	Hope, Lord J.	Mullan, Lt. C. H.
Clarke, Col. R. S.	Howard, Hon. A.	Neven-Spence, Sir B.
Clitton-Brown, Lt.-Col. G	Hudson, Rt. Hon. R. S. (Southport)	Nicholson, G.
Cole, T. L.	Hurd, A.	Nield, B. (Chester)
Conant, Maj. R. J. E.	Hutchison, Col. J. R. (Glasgow, C.)	Noble, Comdr. A. H. P
Cooper-Key, E. M.	Jarvis, Sir J.	Nutting, Anthony
Corbett, Lieut.-Col. U. (Ludlow)	Jeffreys, General Sir G.	O'Neill, Rt. Hon. Sir H.
Crookshank, Capt. Rt. Hon. H. F. C	Jennings, R.	Orr-Ewing, I. L.
Crosthwaite-Eyre, Cot. O. E.	Joynson-Hicks, Lt.-Cdr. Hon. L. W	Osborne, C.
Crowder, Capt. John E.	Kerr, Sir J. Graham	Peake, Rt. Hon. O.
Cuthbert, W. N.	Kingsmill, Lt.-Col. W. H.	Peto, Brig. C. H. M
De Ia Bère, R	Lambert, Hon. G.	Pickthorn, K.
Digby, S. W.	Lancaster, Col. C. G.	Pitman, I. J.
Dodds-Parker, A. D.	Langford-Holt, J.	Poole, O. B. S. (Oswestry)
Donner, Sqn.-Ldr. P. W.	Law, Rt. Hon. R. K.	Price-White, Lt.-Col. D.
Drayson, G. B.	Legge-Bourke, Maj. E. A. H	Raikes, H. V.
Drewe, C.	Lennox-Boyd, A T.	Ramsay, Maj. S.
Dugdale, Maj. Sir T. (Richmond)	Linstead, H. N.	Rayner, Brig. R.
Duncan, Rt. Hn. Sir A. (City of Lond.)	Lipson, D. L.	Reed, Sir S. (Aylesbury)
Duthie, W. S.	Lucas-Tooth, Sir H.	Reid, Rt. Hon. J. S. C. (Hillhead)
Eccles, D. M.	Lyttelton, Rt. Hon. O.	Ronton, D.
Eden, Rt. Hon. A.	MacAndrew, Col. Sir C.	Roberts, Emrys (Merioneth)
Elliot, Rt. Hon. Walter	McCallum, Maj. D.	Roberts, H. (Handsworth)
Fleming, Sqn.-Ldr. E. L.	MacDonald, Sir M. (Inverness)	Roberts, Maj. P. G. (Ecclesall)
Roberts, W. (Cumberland, N.)	Strauss, H. G. (English Universities)	Ward, Hon. G. R.
Robinson, Wing-Comdr. Roland	Stuart, Rt. Hon. J. (Moray)	Watt, Sir G. S. Harvie
Ropner, Col. L.	Sutcliffe, H.	Webbe, Sir H. (Abbey)
Sanderson, Sir F.	Taylor, C. S. (Eastbourne)	Wheatley, Colonel M. J.
Savory, Prof. D. L	Thomas, J. P. L. (Hereford)	White, Sir D. (Fareham)
Scott, Lord W.	Thorneycroft, G E. P. (Monmouth)	Williams, C. (Torquay)
Shephard, S. (Newark)	Thornton-Kemsley, C. N.	Williams, Gerald (Tonbridge)
Shepherd, W. S. (Bucklow)	Thorp, Lt.-Col. R. A. F.	Willink, Rt. Hon. H. U.
Smith, E. P. (Ashford)	Touche, G. C.	Willoughby de Eresby, Lord
Snadden, W. M.	Turton, R. H.	Winterton, Rt. Hon. Earl
Spearman, A. C. M.	Vane, W. M. F.
Stanley, Rt. Hon. O.	Wadsworth, G.	TELLERS FOR THE AYES:
Stoddart-Scott, Col. M.	Walker-Smith, D.	Sir Arthur Young and
		Mr. Buchan-Hepburn.
NOES.
Adams, Richard (Balham)	Davies, Ernest (Enfield)	Hubbard, T.
Adams, W. T. (Hammersmith, South)	Davies, Harold (Leek)	Hudson, J. H. (Ealing, W.)
Alexander, Rt. Hon. A. V.	Davies, Hadyn (St. Pancras, S.W.)	Hughes, Hector (Aberdeen, N.)
Allen, A. C. (Bosworth)	Davies, R. J. (Westhoughtan)	Hughes, H. D. (W'lverh'pton, W.)
Allen, Scholefield (Crewe)	Davies, S. O. (Merthyr)	Hutchinson, H. L. (Rusholme)
Alpass, J. H.	Deer, G.	Hynd, H. (Hackney, C.)
Anderson, A. (Motherwell)	Delargy, Captain H. J.	Irving, W J.
Anderson, F. (Whitehaven)	Diamond, J.	Isaacs, Rt. Hon. G. A
Attewell, H. C.	Dobbie, W.	Janner, B.
Attlee, Rt. Hon. C. R.	Dodds, N. N.	Jay, D. P. T
Austin, H. Lewie	Donovan, T.	Jeger, G (Winchester)
Awbery, S. S.	Driberg, T. E. N.	Jeger, Dr S W (St. Pancras, S.E.)
Ayles, W. H.	Dugdale, J. (W. Bromwich)	Jones, Rt. Hon. A. C. (Shipley)
Ayrton Gould, Mrs. B.	Durbin, E. F. M.	Jones, D. T. (Hartlepools)
Bacon, Miss A.	Dye, S.	Jones, Elwyn (Plaistow)
Baird, J.	Ede, Rt. Hon. J. C.	Jones, P Asterley (Hitchin)
Balfour, A.	Edelman, M.	Keenan, W
Barnes, Rt. Hon. A. J.	Edwards, John (Blackburn)	Kenyon, C.
Barstow, P. G.	Edwards, N. (Caerphilly)	Key, C. W
Barton, C.	Edwards, W. J. (Whitechapel)	King, E. M.
Battley, J. R.	Evans, E. (Lowestoft)	Kinley, J.
Bechervaise, A. E.	Evans, John (Ogmora)	Kirby, B. V.
Belcher, J. W.	Evans, S. N. (Wednesbury)	Kirkwood, D.
Bellinger, Rt. Hon. F. J.	Ewart, R.	Lang, G.
Benson, G.	Fairhurst, F.	Lavers, S.
Berry, H.	Farthing, W. J.	Lee, F (Hulme)
Bevan, Rt. Hon. A. (Ebbw Vale)	Field, Capt. W. J.	Lee, Miss J- (Cannock)
Bing, G. H. C.	Fletcher, E. G. M. (Islington, E.)	Leonard, W.
Blackburn, A. R.	Follick, M.	Lever, N H.
Blenkinsop, A.	Foot, M. M.	Levy, B. W.
Blyton, W. R.	Forman, J. C.	Lewis, J. (Bolton)
Boardman, H.	Foster, W. (Wigan)	Lewis, T (Southampton)
Bowden, Flg.-Offr. H. W.	Fraser, T. (Hamilton)	Lindgren, G. S.
Bowles, F. G. (Nuneaton)	Freeman, Maj. J. (Watford)	Lipton, Lt.-Col. M.
Braddock, Mrs. E. M. (L'pl, Exch'ge)	Freeman, Peter (Newport)	Logan, D G.
Braddock, T. (Mitcham)	Gaitskell, H. T. N.	Longden, F.
Bramall, Major E. A.	Gallacher, W.	Lyne, A. W.
Brook, D. (Halifax)	Ganley, Mrs. C. S.	McAdam,W.
Brown, George (Belper)	Gibbins, J.	McAllister, G.
Brown, T. J. (Ince)	Gibson, C. W.	McEntee V. La T.
Brown, W. J. (Rugby)	Gilzean, A,	McGhee, H. G.
Bruce, Maj. D. W. T.	Glanville, J. E. (Consett)	McGovern, J.
Buchanan, G.	Gooch, E. G.	Mack, J. D.
Burden, T. W.	Goodrich, H. E.	McKay, J. (Wallsend)
Burke, W. A.	Greenwood, Rt. Hon. A. (Wakefield)	Mackay, R. W. G. (Hull, N.W.)
Butler, H. W. (Hackney, S.)	Greenwood, A. W. J. (Heywood)	McKinlay, A. S.
Carmichael, James	Grenfell, D. R.	Maclean, N. (Govan)
Castle, Mrs. B. A.	Grierson, E.	McLeavy, F.
Champion, A. J.	Griffiths, D. (Rother Valley)	MacMillan, M. K. (Western Isles)
Chater, D.	Griffiths, Rt. Hon. J. (Llanelly)	McNeil, Rt. Hon. H.
Chetwynd, G. R.	Griffiths, W D (Moss Side)	Macpherson, T. (Romford)
Cocks, F. S.	Gunter, R. J.	Malialieu, J. P. W.
Coldrick, W.	Guy, W. H.	Mann, Mrs. J.
Collick, P.	Haire, John E. (Wycombe)	Manning, C (Camberwell, N.)
Collindridge, F.	Hale, Leslie	Manning, Mrs. L (Epping)
Collins, V J.	Hall, W. G.	Marshall, F. (Brightside)
Colman, Miss G. M.	Hamilton, Lieut.-Col. R	Mathers, G
Comyns, Dr. L.	Hardman, D. R.	Mayhew, C P.
Cool, T. F.	Hardy, E. A.	Medland, H. M.
Cooper, Wing-Comdr. G.	Harrison, J.	Mellish, R. J.
Corbet, Mrs. F. K. (Camb'well, N.W.)	Hastings, Dr. Somerville	Middleton, Mrs. L.
Corlett, Dr. J.	Henderson, A. (Kingswinford)	Mikardo, Ian
Cove, W. G.	Henderson, Joseph (Ardwiek)	Millington, Wing-Comdr. E. R.
Crawley, A.	Herbison, Miss M.	Mitchison, Maj. G. R.
Crossman, R. H. S.	Hewitson, Capt. M.	Monslow, W
Daines, P.	Holman, P	Moody, A. S.
Daiton, Rt. Hon. H	Holmes, H. E. (Hemsworth)	Morgan, Dr. H. B.
Davies, Clement (Montgomery)	House, G.	Morley, R.
Davies, Edward (Burslem)	Hoy, J	Mort, D. L.

Moyle, A.	Rogers, G. H. R.	Thurtle, E.
Murray, J. D.	Ross, William (Kilmarnock)	Tiffany, S.
Nally, W.	Royle, C.	Titterington, M. F.
Naylor, T. E.	Sargood, R.	Tolley, L.
Neal, H. (ClayCross)	Scollan, T.	Tomlinson, Rt. Hon. G.
Nicholls, H. R. (Stratford)	Scott-Elliot, W.	Turner-Samuels, M.
Noel-Baker, Capt. F. E. (Brentford)	Shackleton, Wing.-Cdr. E. A. A.	Ungoed-Thomas, L.
Noel-Baker, Rt. Hon. P. J. (Derby)	Sharp, Granville	Usborne, Henry
Noel-Buxton, Lady	Shawcross, C. N. (Widnes)	Vernon, Maj. W. F
O'Brien, T.	Shawcross, Rt. Hn. Sir H. (St. Helens)	Viant, S. P.
Oldfield, W. H.	Shinwell, Rt. Hon. E.	Walkden, E.
Oliver, G. H.	Shurmer, P.	Wallace, G. D. (Chislehurst)
Orbach, M.	Silkin, Rt. Hon. L.	Wallace, H. W. (Walthamstow, E.)
Paget, R. T.	Silverman, J. (Erdington)	Warbey, W. N.
Paling, Rt. Hon. Wilfred (Wentworth)	Silverman, S S. (Nelson)	Watson, W. M.
Palmer, A. M. F.	Simmons, C. J.	Webb, M. (Bradford, C.)
Pargiter, G. A.	Skeffington, A. M	Weitzman, D.
Parker, J.	Skeffington-Lodge, T. C	Wells, W. T. (Walsall)
Parkin, B. T.	Smith, C. (Colchester)	West, D. G.
Paton,' Mrs. F. (Rushcliffe)	Smith, Ellis (Stoke)	Westwood, Rt. Hon. J.
Paton, J. (Norwich)	Smith, S. H. (Hull, S.W.)	Wigg, Col. G. E.
Pearson, A.	Snow, Capt. J. W	Wilcock, Group-Capt. C. A. B.
Peart, Capt. T. F.	Solley, L. J.	Wilkes, L.
Platts-Mills, J. F. F.	Sorensen, R. W.	Wilkins, W. A.
Poole, Major Cecil (Lichfield)	Soskice, Maj. Sir F.	Willey, O. G. (Cleveland)
Porter, E. (Warrington)	Sparks, J. A.	Williams, W. R. (Heston)
Porter, G. (Leeds)	Stamford, W	Williamson, T.
Price, M. Philips	Stephen, C.	Willis, E.
Proctor, W. T.	Stewart, Michael (Fulham, E.)	Wills, Mrs. E. A.
Pursey, Cmdr. H	Strachey, J.	Wilmot, Rt. Hon. J.
Randall, H. E.	Strauss, G. R. (Lambeth, N.)	Wilson, J. H.
Ranger, J.	Stross, Dr. B.	Wise, Major F. J.
Rankin, J.	Stubbs, A. E.	Woodburn, A.
Rees-Williams, D. R.	Summerskill, Dr. Edith	Woods, G. S
Reeves, J.	Symonds, A. L.	Wyatt, W.
Reid, T. (Swindon)	Taylor, H. B. (Mansfield)	Yates, V. F.
Rhodes, H.	Taylor, R. J. (Morpeth)	Young, Sir R. (Newton)
Richards, R.	Taylor, Dr. S. (Barnet)	Younger, Hon. Kenneth
Ridealgh, Mrs. M.	Thomas, I. O. (Wrekin)	Zilliacus, K.
Robens, A.	Thomas, John R. (Dover)
Roberts, Goronwy (Caernarvonshire)	Thomson, Rt. Hon. G. R. (Ed'b'gh, E.)	TELLERS FOR THE NOES:
Robertson, J. J. (Berwick)	Thorneycroft, Harry (Clayton)	Mr. Hannan and
		Mr. Popplewell.

Bill committed to a Standing Committee.