AIRWAYS CORPORATIONS BILL

HC Deb 29 June 1949 vol 466 cc1299-405

Order for Second Reading read.

3.40 p.m.

The Parliamentary Secretary to the Ministry of Civil Aviation (Mr. Lindgren)

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

In asking the House to give a Second Reading to the Bill, may I first call attention to the fact there are no political issues in the Measure? I notice that hon. Gentlemen opposite have indicated on the Order Paper that they intend to divide against the Bill, but I hope that the discussion will not be on a party political basis but on the basis of how best to do a job of work, how best to organise our long-distance overseas transport air services. All those who have any responsibility for airline operation are in favour of this Bill; not only that, they ask for it to be given legislative effect at the earliest possible moment. The boards of B.O.A.C. and B.S.A.A. are in favour of the Bill, and those boards are composed of business men—men who prior to coming into association with civil air transport were and in some cases still are associated with successful private enterprise, men who, if they have any political affiliations, are much more akin to hon. Gentlemen opposite than they are to my own political affiliations.

Air-Commodore Harvey (Macclesfield)

How does the hon. Gentleman know?

Mr. Lindgren

Only from their previous associations, and from the fact of having met them only since I have been connected with air transport. I have never met them at Labour Party conferences or at the T.U.C., where I usually find most of my friends.

Mr. Lennox-Boyd (Mid-Bedford)

The only chief executive of any air corporation who has sought Parliamentary honours stood as a Liberal.

Mr. Lindgren

The best politicians are very often outside Parliament, not in it.

Further, all the trade unions representing workers in the industry are in favour of the Bill, and ask the House to give it a Second Reading.

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

Including the Aeronautical Engineers Association?

Mr. Lindgren

It is being very kind to call them a trade union. Every trade union recognised by the trade union movement supports this Bill. In referring to the A.E.A. I do not wish to be offensive; that is the last thing one would wish to do in seeking to secure a Second Reading for the Bill, but in trade union circles we have a phrase; it is a "goose club"; it is not a trade union, and it is not recognised as such.

Colonel Hutchison

To be fair to this union, is it not the case that they represent the majority of the ground staff of the three Corporations?

Mr. Lindgren

By no means. By far the greatest number of engineers in the Corporations are members of the A.E.U. The A.E.A. does claim to have the greater proportion of membership in B.S.A.A. but the A.E.U. retort that it is a paper membership, not a paying membership. I have no details to challenge the facts one way or the other, but according to the A.E.U., once a member of the A.E.A. always a member, whether one pays one's subscription or not. Everyone who is associated with air transport who knows anything about airline operation, the work to be done, the aircraft that are available or the routes to be served, are in favour of this Bill. I ask the House to remember these plain straightforward facts when dealing with this Measure.

Having made those preliminary observations, may I set what I hope will be an example by making a detailed and analytical case in favour of the Second Reading of the Bill? The Civil Aviation Act, 1946, established three air Corporations, and it did so for the purpose of giving an opportunity for some sort of competition between the Corporations. All that this Bill does is to amalgamate B.O.A.C. and B.S.A.A. into one Corporation. No change whatever is proposed, nor is there intended to be a change, in the status of B.E.A., which will continue its separate existence. The provisions of the Bill do not amend the Civil Aviation Act, 1946, in any way other than in bringing together B.O.A.C. and B.S.A.A.

The Government's White Paper, Command 6712 of 1945, announced the Government's policy for British air services. The original decision was, as I have just mentioned, to have the three Corporations. That decision was largely based on the fact that this was a young industry and there was a desire to create flexibility of approach to its problems. It was considered that three Corporations helped in that direction. They offered independence of approach to the form or organisation and techniques of operation and promoted a healthy rivalry one with the other while at the same time avoiding the worst effects of destructive competition.

It was recognised that while the policy might have advantages there might also be disadvantages, and that in the light of the experience gained the Government would then decide the policy they would pursue. I should make it quite clear that at no time was the three-Corporation structure of the industry regarded as necessarily permanent. The Lord President of the Council, in the Second Reading Debate on the Civil Aviation Act on 6th May, 1946, went out of his way to explain that there was no particular virtue in three Corporations, that it was the principle which we felt was correct at the time, but that they might prove to be too few or too many, and that in the light of the experience gained over a period any arrangements necessary would be made to bring about a more effective or efficient organisation.

We have had two years' experience, which have taught us much about forms of organisation, conduct of management, techniques of operation and commercial methods required to conduct successful airline operation. The aircraft, the route organisation requirements, commercial methods, traffic organisation, training and maintenance arrangements and many other features are similar for B.O.A.C. and B.S.A.A. Both are long-distance operators, operating to the Western Hemisphere with four-engined aircraft. Such conditions naturally pose the question whether closer integration would make for greater efficiency and more economical working.

B.E.A. have a totally different type of operation—internal and short-distance Continental operation. They operate with twin-engined aircraft, their aircraft requirements and traffic handling requirements are different, and they have totally different problems to face. Accordingly the Government have no intention of amalgamating B.E.A. with the new Corporation to be formed, B.O.A.C. There will still be two Corporations. May I emphasise this point, because there have been indications in the Press that it is the intention of the Government to amalgamate B.E.A. with B.O.A.C. That is not the intention of the Government at the present time.

Air-Commodore Harvey

Or the management?

Mr. Lindgren

Or the management. There are two Corporations. They are operating under two totally different sets of conditions. They have different spheres in which to operate, and the technique of operation is different. Of course, if at some later date aircraft arrangements and production change, and it becomes possible or necessary to amalgamate, that would be something to be discussed in the future; but under present operational conditions it is not intended to amalgamate B.E.A. with B.O.A.C.

After the experience gained under the three-Corporation structure of the industry and the routes operated and planned for the future development by B.O.A.C. and B.S.A.A. on the North and South Atlantic, my noble Friend some time ago—long before the Star Ariel was lost—considered the question whether or not economy and efficiency in the industry would be brought about by some closer co-operation or amalgamation of B.O.A.C. and B.S.A.A. The present and planned pattern of the routes of the two Corporations will, I hope, convince the House that some closer working is necessary. The B.O.A.C. trans-Atlantic services, operated with Constellations, are routed via Shannon Airport, or Prestwick, and Gander to New York, with an extension of certain New York services down to Bermuda. The B.S.A.A. planned their services by two other Atlantic routes; a South Atlantic route via Lisbon and Dakar to Brazil, the Argentine and Chile, and a mid-Atlantic route via the Azores and Bermuda to the Caribbean, Central America and the Northern Republics of South America. That was the different pattern of services of the two Corporations.

After the disappearance of the Star Tiger in February, 1948, in the long and difficult sector Azores-Bermuda, the services to the Caribbean and Central America were re-routed via Shannon, or Prestwick, and Gander to Bermuda. Thus, when the Tudors were in operation, both Corporations were operating independently by a common trans-Atlantic route—London, Prestwick or Shannon, Gander, New York, Bermuda—although they were operating with different types of aircraft; B.O.A.C. with Constellations and B.S.A.A. with Tudors. I am sure that no one will seriously dispute that the aim must be to secure the maximum commercial use of capacity over common routes, and therefore economy in the actual use of the number of aircraft required.

There is also another problem, that of flexibility of aircraft requirements to deal with variations from area to area in regard to seasonal changes. North and South America give a very good example of it. In the handling of that seasonal traffic there should be that flexibility which is so desirable. One of the basic objects of all airline operators is to secure the maximum possible utilisation of aircraft throughout the year and to avoid seasonal peaks. Experience has shown that even when two different types of aircraft are operated over the same route by two different companies the amount of flexibility so necessary in airline operations, if one is to achieve the maximum effective use of available aircraft, is not present.

Another factor exercising the mind of my noble Friend was that the independent approach to problems, the healthy rivalry which the three-Corporation system was designed to establish, was in fact tending in some cases to produce independence in directions where closer co-ordination of the activities of the separate corporations was desirable; and where in fact it could have been closer without in any way affecting the essential commercial and operational independence of the two Corporations. Such cases would include passenger handling, transport between the town centre and the airport, catering, and other matters of that kind. These various considerations prompted my noble Friend last year to consider very seriously the advantages and disadvantages of the policy of amalgamation of B.O.A.C. and B.S.A.A.

I have outlined to the House some of the advantages becoming apparent as the network of the services of the two Corporations were being developed. At that time, when my noble Friend was considering the question, however, the board of B.S.A.A. were looking forward to bringing the Tudors into operation, and they were definitely opposed to any amalgamation. If I may express a personal view, I have always advocated, and have represented to the various Ministers I have served, the desirability of more economic and efficient working by the amalgamation of the two organisations. But in view of all the circumstances the Minister felt at that time that amalgamation was not desirable.

B.O.A.C. had their special problems also. They were reorganising the Corporation. The work was going on in the very capable hands of Sir Miles Thomas, who was then deputy-chairman of the Corporation, and who will at the end of the month become chairman in succession to Sir Harold Hartley. This is the last opportunity which I at least, shall have to pay a tribute to Sir Harold Hartley in this House before he leaves the Corporation. On behalf of my noble Friend and myself I would say a word of very high praise to Sir Harold for the energy and enthusiasm he has brought to civil aviation since he came into it in 1946, first with B.E.A. and then with B.O.A.C. I think that the railway experience of Sir Harold, plus his scientific experience, has contributed largely to the success he has made in both Corporations, and everyone will join with me in wishing him well in his retirement.

B.O.A.C. were faced with other special problems. Within the next 12 or 18 months they had to bring in three new types of aircraft, the Stratocruisers, the Canadairs and Hermes. The bringing in of three new types of aircraft is a difficult operation, particularly when an attempt is being made to bring them in simultaneously. There are the questions of route development and organisation, maintenance organisation and all the "bugs" that arise with new aircraft. Without depreciating the industry in any way, no new aircraft has been brought into use in the world, which, in its initial stages, has not created some difficult operational problem. B.O.A.C. were faced with those difficulties, plus the fact that they had to withdraw from service a number of types which had become obsolete; and they had to do that without disturbing their existing services.

Therefore, it was felt that there was a lot in favour of leaving the matters as they were in view of the reorganisation and the introduction of new types of aircraft. That was the view on the basic organisational side. Then it became necessary to withdraw the Tudors from service. This misfortune to B.S.A.A. and the consequential disruption of their planned programme of development left a big gap in British aircraft resources. B.S.A.A. were left without any modern aircraft over a competitive route to meet international competition which was of a high level, from foreign airlines using aircraft which were the most effective operational units in civil aviation.

We were confronted with the problem of replacing in the most efficient and economic way the capacity which had been lost by the withdrawal of the Tudors. I make it plain to the House that the disaster of the withdrawal of the Tudors was the decisive factor, although amalgamation had been under consideration for some time. Certain points were debatable and there were certain people who were much more in favour of the amalgamation than others. When there was a complete loss of the Tudors and there were no aircraft for B.S.A.A. to use, that was the deciding factor which brought about the decision to amalgamate the two Corporations. In the light of these circumstances, the Board of B.S.A.A. were the first to agree, in spite of their previous opposition, that not only was amalgamation desirable but it was the only possible attitude to take.

The six Constellations of B.O.A.C. and the six Stratocruisers to be delivered this year to that Corporation were the only aircraft available and in prospect with the necessary range and capacity to maintain a competitive regular service over the North Atlantic. Therefore, it was absolutely essential to consider amalgamation. To deal with immediate situation of the loss of the Tudors, there had to be a measure of interworking between B.O.A.C. and B.S.A.A. The six Constellations which B.O.A.C. were operating on the North Atlantic were deployed to take not only the B.O.A.C. North Atlantic traffic but the B.S.A.A. traffic across the North Atlantic for the Caribbean and the Southern American Republics. Traffic for these areas is now being carried in that manner across the North Atlantic to New York and then to the Caribbean and Central America.

I turn to the future and the provision of further capacity required to replace the Tudors. The new plan of combined operations on the North Atlantic enables us to exploit to the greatest possible degree the aircraft resources available and to have a single fleet concentrated in as few types as possible. In that way we get the most economic use of the aircraft serving North America, the Caribbean and Central America. Flexibility in the use of capacity, and economy of aircraft requirements, can be secured in the way I have mentioned, by one Corporation, even where there are two Corporations, where one makes capacity available for the other over certain sections. If we are to get the most effective and efficient use from the aircraft, there must be a single management to undertake the responsibility of the deployment of the aircraft and their general utilisation.

The recent purchase of four additional Stratocruisers from the Scandinavian Airlines System is an important feature of this plan. It provides the necessary capacity as far as New York. At the end of this year there will be ten Stratocruisers plus the six Constellations which will provide the aircraft for the North Atlantic operation of the traffic of B.S.A.A. and B.O.A.C. It will provide for the North Atlantic traffic of B.O.A.C. and for the B.S.A.A. traffic which previously went right through to the Caribbean and Central America in its own aircraft. The latter will also go via New York, and then the stretch from there will be covered by B.S.A.A. with other aircraft.

Mr. George Ward (Worcester)

Does that mean that the Central and Southern Atlantic routes are to be permanently abandoned?

Mr. Lindgren

No, Sir. There are two sectors in the operation of B.S.A.A. There is the Caribbean, the Central American States and the Northern Republics of South America. Traffic for those places used to go through the Azores and Bermuda. Now it will go across the North Atlantic to New York and then forward. There is also the old South Atlantic route by Lisbon and Dakar and across from Buenos Aires to Santiago and up the west coast to Chile and Peru. That service will still be operated by different aircraft from this country.

Mr. Ward

This is most important. Is the hon. Gentleman saying that as a permanent arrangement all traffic to the Caribbean and South American States will be carried across the North Atlantic to New York first?

Mr. Lindgren

Yes, Sir. Traffic for the Caribbean and Central America will cross the North Atlantic to New York and then filter down. That is the only possible way.

Mr. Ward

This is a most important statement concerning a serious matter. If we are to abandon the traffic from Lisbon we shall lose a tremendous amount.

Mr. Lindgren

No. I thought I had made it clear. In addition there will be another route which will probably be followed by Canadairs. That route will be London, Lisbon, Dakar, Natal to Buenos Aires, across to Santiago and then up to the coast to Lima and the Carribean.

Then there is the matter that I could not deal with very well at Question time today. As the Stratocruisers come into operation and we have an effective payload over the Bermuda—Azores sector, then the North Atlantic Stratocruisers will probably do the circular tour to New York and return via Bermuda and the Azores to Lisbon and this country or vice versa. That is why this Bill is so essential. All these factors are determined by the aircraft available, and that depends on the amount of dollars we have to spend. There is no question of our being able to go into the open market to buy what we like where we like for the best and most effective use in airline operations. In the light of the resources available our Corporations have to do the best job they can, and I should like to say that they make a very good job of it.

In the first phase of the merger there will be a B.S.A.A. Division of B.O.A.C. in addition to the existing Western and Eastern Divisions of B.O.A.C. Economies will be brought about immediately in the use of fewer types of aircraft, in maintenance, and in the fact that the previous artificial geographical separation of the spheres of the two Corporations will be combined. That will avoid overlapping and enable us to fill in certain gaps in the network of services. It will avoid duplication in the handling of traffic, traffic booking offices and certain other factors of that nature.

These will be economies, but I should make it quite clear that these economies are unlikely to result in appreciable savings in staff additional to the normal wastage which takes place as men and women leave the service. B.S.A.A. was in the process of building up to meet the needs of the Tudors which it was expected would come into service, but which unfortunately it was not possible to introduce. It was preparing for an expansion of its programme, and the new situation, rather than produce big reductions of staff, will in effect lead to greater capacity and better use of available aircraft, and the bringing together of the two Corporations will produce a greater capacity of airline operation.

In short, the emphasis is on producing more with the existing number of staff in both Corporations, rather than dismissals from either the one or the other. There may be certain redundancies, but, in my view, having studied the problem closely with both Corporations, these redundancies will be small, and we shall get a much higher productivity from them. As a measure of this increased productivity, it is estimated, in so far as such estimates can be made, and expressing them in terms of capacity ton miles, that the bringing together of the two Corporations will lead to an increase of 60 per cent. over the pre-amalgamation productivity. That is not entirely or only due to the amalgamation, because the introduction of modern types of aircraft with greater capacity of course brings about that result as well.

The first phase of the organisation is largely dictated by two main considerations. The first of these is to minimise the disruption during the coming into operation of the three new types of aircraft by B.O.A.C.—the Stratocruisers, Canadairs and Hermes. It is also determined by the present unavoidable dispersal of the Corporations operational and maintenance bases. This phase of the organisation will be progressively followed by a modified form of greater devolution on a line basis of responsibility to lines which are responsible for providing aircraft and crews, and to areas, which both at home and abroad are responsible for the commercial exploitation of the services. There will be the line that provides the aircraft and crews, and the areas in which the commercial men will get busy in order to use to the fullest possible extent the aircraft capacity which is provided for them, and the overall direction from the centre at the headquarters level will be simplified and the present geographical executive form of organisation, both in B.O.A.C. and B.S.A.A., will disappear. This will be a period of expanding activity, during which, as in the first phase, economies will tend to be reflected by avoiding increases of staff rather than actual reductions of staff.

May I now turn to the Bill itself? It is unfortunately impossible to make a clean merger of these two Corporations by a single legislative action of this House. B.S.A.A. have various operating rights, contracts and permits in South American countries which, I am advised, cannot be transferred to B.O.A.C. simply by legislation in this country. Instead, these contracts will have to be negotiated and treated individually between the parties concerned, and their transfer will take some time. It is therefore necessary, while these transfers of overseas rights, contracts and such things are taking place, that B.S.A.A. should be kept legally alive, and arrangements will then proceed for B.O.A.C. to take over these essential assets of B.S.A.A.

Clause 1 of the Bill therefore provides for a two-stage merger. The first stage, which is dealt with in subsection (1), is that all B.S.A.A. property in this country and its rights and liabilities will be transferred immediately to B.O.A.C. Under the remaining subsections, B.S.A.A. is empowered to transfer any other property or rights to B.O.A.C., and the latter Corporation is empowered to undertake any liabilities and obligations of B.S.A.A., in both cases without consideration and without payment of Stamp Duty. The second stage is reached when my noble Friend is satisfied that the transfers of overseas rights and liabilities have been effectively carried out, when he may by Statutory Instrument fix an appointed day on which B.S.A.A. shall be dissolved.

Clauses 2 and 3 are required to combine the financial powers and obligations of the two Corporations. They are largely technical, and need not be gone into at this stage, but, in brief, Clause 2 provides for B.O.A.C. to assume the powers of B.S.A.A. under the Civil Aviation Act, 1946, to issue stock and to borrow money, and for B.O.A.C. to take over stock already issued by B.S.A.A. Then, Clause 3 provides that Exchequer Grants made to B.S.A.A. before the passing of the Bill are to be taken into account in calculating any repayments to the Exchequer which B.O.A.C. are required to make under Section 18 of the Civil Aviation Act, 1946.

Air-Commodore Harvey

Will the hon. Gentleman allow me? Will he say how much of that stock has been taken up by B.S.A.A. to date?

Mr. Lindgren

I could not say offhand, but I will find out before the close of the Debate and let the hon. and gallant Gentleman know the figure before he leaves the House.

So far as Clause 3 is concerned, it is purely a question of repayment of Exchequer grants. If I may emphasise it, this Clause in the Bill simply effects an amalgamation of the two Corporations, their powers and obligations, and imposes no further charge on public funds. Clause 4 permits B.O.A.C. to cover B.S.A.A. activities in their statutory accounts, programmes, estimates and reports so long as B.S.A.A. continues to exist. This Clause is inserted in the interests of and in order to facilitate administrative economy.

I have just had a note passed to me that, in fact, the amount taken up is £3,500,000, but I shall check that figure.

Clause 5 concerns the board of the Corporation. Subsection (1) enables the appointment of a second deputy-chairman to B.O.A.C. without affecting the limitations on the number of members of the board, and subsection (2) deals with a small consequential point. As I informed the House on 15th March, my noble Friend intends that, under the chairmanship of Sir Miles Thomas, as Chairman of B.O.A.C., there shall be two deputy-chairmen, Mr. Whitney Straight, who will be responsible for operations, and Mr. John Booth, at present chairman of B.S.A.A., who will be responsible for the commercial side of B.O.A.C. They will become equal joint deputy-chairmen, and their executive functions will be in the fields which I mentioned.

Clauses 6 and 7 contain technical provisions consequent on the merger of the two Corporations. Under Clause 6, proceedings or causes of action concerning B.S.A.A. may be continued or enforced by or against B.O.A.C.; and Clause 7 provides that references to B.S.A.A. in legal documents shall, as from the dissolution of that Corporation, be construed as references to B.O.A.C.

I do not want to detain the House at this stage, but I wish to say in conclusion that I have now been associated with civil aviation for nearly three years, a period during which I have seen a steady progress in all branches of the theory and practice of airline operation. Workers and management in the Corporation, from those at the top to those at the bottom, have done a first-class job. They have put their heart and soul into the task of making a success of British air transport. The House may criticise my noble Friend and myself as much as it likes, and can knock us about at much as it likes; we can hear the criticisms, and can answer for ourselves. But I am sure we all agree that we should give credit to the men and women who have been engaged in civil aviation and who have done a first-class job within the Corporations. Workers and managements in the industry itself deserve the credit of this House because what has been done by them is not politics; it is a job of work. Their operations are no different from those of road, rail or sea transport; the fundamental economics of all forms of transport are the same. Looking now at the tasks which have to be undertaken, and in the light of some experience and knowledge of the subject, I can honestly say to the House that the prospects for British civil aviation were never better than they are today. Therefore, I hope the House will give this Bill a Second Reading.

4.24 p.m.

Mr. Lennox-Boyd (Mid-Bedford)

I beg to move to leave out "now," and at the end of the Question to add, "this day three months."

Lest any new Member might think that three months argues less opposition than six months, I should like to point out that it has nothing to do with any prior knowledge of the Government's electoral intentions, but is one of the conventions of the House when moving the rejection of a Bill after Whitsun.

The Parliamentary Secretary to the Ministry of Civil Aviation, who moved the Second Reading, said that he has had a lengthy association with civil aviation. I do not think I am betraying any political cause when I say that he has always treated the Opposition with great courtesy and done his best in and outside the House to make our aviation affairs a joint national concern. But just as the Lord President of the Council said when commending the Bill which we are now so ruthlessly amending, so we on this side of the House feel today that what we need is a policy put forward with conviction, courage and system, instead of half-baked plans piloted by nervous and shaking hands. As this Bill may be cited as the Bill of 1949, so we feel that there will be a number of other Airways Corporations' Bills of which this is but the first if the nervous, palsied and shaking hands are left much longer in charge of our aviation affairs.

I can join with the Parliamentary Secretary in paying a tribute to Sir Harold Hartley. He has certainly shown great courtesy and kindness and great technical knowledge throughout the period in which he has been looking after B.O.A.C. and before when he was looking after the previous Corporation. He has enormous gifts which those who knew him in his Oxford days fully appreciate. Indeed, although I hardly expect the hon. Gentleman to make this his argument, Sir Harold Hartley would make an excellent University Member of Parliament. When I say that we praise him for the services he has rendered, I think that is the last thing I can say in support of the arguments advanced by the hon. Gentleman.

We have made it quite plain that the Opposition intend to give a wide measure of freedom to civil aviation, with private transport interests playing a very large part and giving their immense skill and experience in transport to the work of civil aviation in the future. It is perfectly true that we shall always have competition from abroad, but to suggest, as is sometimes done, that one can best meet that competition by having no competition at home surely means that every single industry in this country engaged in the export trade should pass into monopolistic hands. We are more likely to win the friendly battle with our foreign rivals if, by fierce competition, restrained but definite, in our own field, we have got the best standard bearers for our civil aviation to win the battle with our foreign competitors. We believe that the present arrangement will never work, and, as I said, that this Bill will be followed very shortly by another Airways Corporation Bill which will create the giant monopoly so dear to the Socialist planner. We believe that this will never work because we think it is fundamentally opposed to the true instincts of the British people.

As this is an aviation Debate, perhaps it would not be altogether improper to quote from a letter in "The Times" of a month or two ago from Sir Geoffrey de Havilland, in which he spoke about impersonal organisations, and any who know the working of the great de Havilland Company know that that is a pretty personal organisation. He said that in impersonal organisations the ordinary man—the "plain" man he called him—cannot rise by his own initiative, talent and honest efforts. With the immense experience of his very good business behind him, he said that a successful enterprise cannot be built up except by a slow process of team work"— and there is team work in B.S.A.A.— and apprenticeship training, of venture against competition, and with full responsibility for the outcome. Just as the Government are very ready, and quite properly ready, to pay tribute to the work of the de Havilland Company in the field of civil and military aviation, so, I think, they might ponder on these very significant words.

We very much regret that the first amending Bill to be introduced into this House dealing with the three Corporations should concern itself with the elimination of that Corporation which was born of the enterprise of the shipping interests and then in Coalition days, with the support of many Socialist Ministers, was planned as a fruitful partnership of private shipping interests and the State. It seems to us a tragedy that a combination of this kind, born of such a partnership, should be the first of the three Corporations to fall under the Government axe.

The hon. Gentleman has added very little to the arguments that have already been given to this House and to another place in commending this proposal. He has told us, in effect, that this move is justified, and indeed is necessary, because in the view of the Government it will lead to more economical and efficient organisation, and because it is forced on them by the shortage of aircraft for B.S.A.A. Those are the only two arguments, and it is mainly to those arguments that I should like now to address my own, dealing first with the argument that by this merger we shall get more economical and efficient organisation.

Our party naturally believes that efficiency is usually best achieved by competition—by restrained competition when dealing with an essential national service, but none the less by competition. So do the Government, because when this Bill was introduced some three years ago that was made perfectly plain. In the first place, harking back for a moment to the Coalition White Paper, to which, as I say, many Socialist Ministers gave their adherence, we stressed the need to have units of aviation so relatively small that there could be individual supervision of all the routes, and we also made it plain that we wanted to avoid a sealed pattern of management and operation so as to encourage, different managements to try out new ideas.

Those views apparently commended themselves to His Majesty's present advisers, for in their own White Paper of December, 1945, Cmd. 6712, they stressed the need for flexibility in management, and referred to the need for different methods of approach to the technique of airline operation. It is perfectly true that they do not say "There must be three Corporations," but it is quite obvious that if there are three Corporations and two merge, there is no assurance that the two will not disappear, leaving one, in which case there would be complete elimination of competition altogether. According to the Government's White Paper, what we need are different methods of approach to the technique of airline operation.

Then came the introduction of the Civil Aviation Bill into the House of Commons, which Measure we are now in effect drastically amending. The Lord President commended that Bill to the House. I do not think his greatest admirers in the Socialist Party would say that it was his best effort at clear thinking, but one of the things which was, at any rate, quite clear was his statement that what we need in civil aviation is an element of emulation and legitimate competition."—[OFFICIAL REPORT, 6th May, 1946; Vol. 422, c. 606.] The Parliamentary Secretary has told us that in the experience of the last three years or so the different Corporations have been—I think I have his words right—tending to create independent approaches. He mentioned things like catering and other services of which we have heard extremely little in the many Debates we have had in the last two years, and it has never at any time been suggested that what was called emulation and legitimate competition when the Lord President commended the Bill to Parliament three years ago has now become individual approaches by the Corporations which are so independent that they are adding unnecessarily to the overheads.

In our view, it would be bad enough if this procedure stopped here, but despite what was said by the Parliamentary Secretary a few moments ago, we certainly have no assurance that that will really happen, and many of us who are not altogether ignorant of the trend of thought in Government circles believe that this Bill is the precursor of another Bill which will eliminate all competition between the Corporations and leave us with only one Corporation. If that is the Government's intention, it would have been more honest to do it now. They have got enough difficulties in doing it by bits and pieces, so that they are reluctant to do it all together. We are entitled to assume that these ideas are, at any rate, in the Government's mind.

When my right hon. Friend the Member for West Bristol (Mr. Stanley) questioned the Parliamentary Secretary some weeks ago, at the time when this merger was first announced, he asked: Are we then to understand that although it may be possible to reduce the number from three to two, it would not be right to reduce it from three to one? The Parliamentary Secretary answered: Not at the present time."—[OFFICIAL REPORT, 15th March, 1949; Vol. 462, c. 1925.] He gave no emphatic denial, but today he said, "It is not our intention." A few weeks ago he said that it was not their intention at the present time.

Mr. Lindgren

I am sure the hon. Gentleman does not wish to do me an injustice. When words are used in this House they are quoted as a guarantee of some policy. It is obvious, at least as far as I am concerned, that one cannot say what is going to happen in four, five or 10 years' time. All that I was concerned with, in replying to the right hon. Gentleman, were the statements that I was making and the present intentions of the Government. I made it quite clear that, so far as the present intentions are concerned, and so far as we can see, those two Corporations shall be separate because in technique and operation they are quite different.

Mr. Lennox-Boyd

I thank the hon. Gentleman for his answer. He and his colleagues need not disturb themselves as to what will happen in five or 10 years' time. They will not have executive responsibility then. All we are concerned about is what will happen in the period for which they are responsible. In our view, this trend of circumstances is inseparable from the Socialist nationalisation philosophy. Just as when they nationalised the railways they decided it would be more efficient to nationalise road transport, and just as when they nationalised road transport A and B licensees they then threatened the C licensees, so within the Corporations themselves if one Corporation has the misfortune to make a profit, that Corporation is going to be used as a yardstick by which the imperfections of the other Corporations may be shown up. It is no good saying that when a Corporation makes a profit it is conduct prejudicial to good discipline in the Socialist economy, because they know perfectly well that if they do that other people are going to watch and see whether their own failure to deliver the goods may not be shown up in a pretty vivid form.

Incidentally, one of the reasons why this merger is now being commended to the country and to Parliament is that we are told it is to combine the efficiency and safety of B.O.A.C. with the pioneer spirit of B.S.A.A. But if there had not been these separate Corporations with one able to show the pioneer spirit, then there would be no comparison possible. So the Government are calling in aid to abolish competition the circumstances which enable this comparison to be made. There is no assurance whatever that British European Airways may not go the same way, and that we shall find one giant Corporation running the whole of our monopolistic services.

Mr. Beswick (Uxbridge)

The hon. Gentleman is talking about the trend of Socialist thought in the country. Has it not occurred to him that the trend has actually been in the contrary direction to that which he indicated? We have regional boards under the National Coal Board, area boards in the gas industry, and in the case of the last Nationalisation Bill, the Iron and Steel Bill, we have left the firms entirely separate.

Mr. Lennox-Boyd

That is largely due to electoral considerations. On the one hand, there is the electorate and on the other hand there is the four-year-old "Let us Face the Future," and the Government are compromising like mad, although not enough, in order to avoid the consequences of their actions.

Mr. Lindgren

Perhaps the hon. Gentleman will tell us why even a Conservative Government amalgamated British Airways and Imperial Airways into B.O.A.C.

Mr. Lennox-Boyd

It is true there was an amalgamation and a monopoly, but a monopoly of subsidy and not a monopoly of operation. There was nothing to stop competition. The only thing which they enjoyed and which others could not enjoy was the subsidy. Under those conditions today, I have little doubt that new private enterprise firms would sooner come in. When I see that British European Airways Corporation have no assurance that their independent existence is ended for ever—and I will not develop the significant resignations and retirements in recent months, which did not stop with the departure of Mr. D'Erlanger, but included almost equally important resignations—I am reminded of the remark made to the British South American Airways employees when, about 10 months ago, they first heard rumours of this intention.

B.S.A.A. staff heard last August that this amalgamation was possible. There was, naturally, a great deal of discussion about it. They were very proud of their achievement in being the only Corporation to make a profit during the first year. They were proud of the fact that people seem to like to belong to their Corporation, are happy in it and have a sense of esprit de corps which, at this time in our history, it seems unwise to dissipate. When they heard that B.S.A.A. might be abolished, they were naturally rather anxious about it and a notice was posted on their staff notice boards by the secretary of B.S.A.A. only last August condemning what were called "irresponsible and mischievous rumours" of the merger and assuring the staff that there was no reason whatever that such a thing should ever come about. If assurances are today given to the employees of British European Airways, no doubt they will remember the assurance given to their colleagues in the other Corporation.

If this does, in fact happen and there is only one Corporation left, where shall we be? We shall have no yardstick at all. No doubt we shall have plenty of competitors for the headship of this great new Corporation. It might even be the present chairman of British South American Airways, but it is more likely to be the noble Lord, Lord Douglas, Chairman of British European Airways, whose, public conversion to Socialism is as recent as that of Lord Milverton, but who seems to be ready to continue the rake's progress a little longer, to continue the sinister journey, provided it is conducted by air, at least until the results of the next General Election are known.

Already provision seems to be made in this Bill for just such a circumstance. If we look at Clause 2 (6), we see that power is now taken to give B.O.A.C. the authority to raise money for "the promotion of other undertakings"; and I imagine that "other undertakings" could certainly cover, legally, the activities of B.E.A. Thus, when the hon. Gentleman said that it was not possible to abolish B.E.A. in one fell swoop, no doubt the Government are profiting by their difficulties now in order to make the next operation slightly more expeditious. If it does come about, there will be no yardstick of any kind, no way whatever of judging the efficiency with which our air services are conducted. At the present moment we are still able to say that the average plane of B.S.A.A. spends one-fifth of its time in the air while the average plane of B.O.A.C. spends one-seventh of its time in the air; that the subsidy per load ton mile in the case of B.O.A.C. is 26 pence per load ton mile and is 10.1 pence in the case of B.S.A.A.; that the capacity ton miles per employee of B.O.A.C. is 3,000 and of B.S.A.A. 9,950; that B.S.A.A., on a mileage only one-fifth of that of B.O.A.C., are managing with one-tenth of the staff. These comparisons are still possible.

Mr. Mikardo (Reading)

While the hon. Gentleman is on that subject, what about some accident comparisons?

Mr. Lennox-Boyd

Certainly. I have no wish whatever to get over the difficulties of accidents, and no one could deny the brilliant record of B.O.A.C. in the field of air safety; but the same people authorise aircraft to take the sky, whether they are flown by B.S.A.A. operators or B.O.A.C. operators, and the same tests are applied, and I think it would be extraordinarily ungenerous and quite unfair to condemn a company whose aircraft had been certified as airworthy with a certificate issued by the same people as those who certified the aircraft of B.O.A.C.

Mr. Mikardo

I am sure the hon. Gentleman knows very well that accidents do not depend only on the airworthiness of aircraft but on a lot of other factors as well, and that, whilst keeping within the definition of requirements, it is still possible to skimp requirements a little in these other factors; and is that not precisely what happened in B.S.A.A.?

Mr. Lennox-Boyd

From this side of the House we have always pressed for the fullest publicity in all inquiries and we have no wish that anything should be done secretly or without the public knowing. No one ever suggested that an essential element in safety had been disregarded. Indeed, while it is perfectly true that B.S.A.A. planes have been continuously in the air for a greater proportion of time than others, the pilots themselves have made it quite plain that, though worked hard, they are not overworked and there is no point in which the human element, because of the Corporation's orders, could have explained any of the troubles or difficulties.

Mr. Beswick

Will the hon. Gentleman inquire from his hon. and gallant Friend the Member for Macclesfield (Air-Commodore Harvey) about the occasion of which his hon. and gallant Friend told us in this House when Tudors landed in Bermuda short of the safety margin of fuel?

Mr. Lennox-Boyd

I hope my hon. and gallant Friend will catch your eye, Mr. Speaker, and then, no doubt, the hon. Member for Uxbridge (Mr. Beswick) will have an opportunity to ask him about that. I was anxious to show that we should have no further standard of comparison between the various Atlantic operations, the South Atlantic and North Atlantic operations, and if, as we think is likely to happen, the third Corporation also disappears, we shall have no yardstick of any kind at all.

Speaking about staff, as I did a moment ago, leads me to the question of what the staff think about this move. I must be careful not to get out of Order, for, at a time when we are having a great deal of difficulty with the nationalised railways, I am sure the Government will agree that what the operators of nationalised undertakings think about the Government are not always things that the Government ought to do. But I think we are entitled to say, in regard to the aircraft industry, that the claims made by His Majesty's Government are quite untenable.

The hon. Gentleman spoke of the Amalgamated Engineering Association. He said it was very kind to talk of it as a union; he even called it a "goose club." This is a most curious way to get people to unite behind the service of the Corporation, when we remember that the overwhelming proportion of the people working for B.S.A.A. belong to the A.E.A. At the present moment some 60 per cent. of the workers claim to be members of the Amalgamated Engineering Association. I am not so learned in trade union organisation as the Parliamentary Secretary; I know a little bit more about friendly societies than he does, but not so much about trade union organisation. Nevertheless, I am prepared to agree that if a union can claim successfully to have 60 per cent. of the workers in some industry as members, the fact that it is called a goose club by the Parliamentary Secretary does not alter its claim to speak for the people it represents.

Quite apart from this, the British Airline Pilots' Association have emphatically repudiated these arrangements, and very many pilots in B.S.A.A. belong to that association. The Association of Clerical Supervisory Staffs say they were never even approached. These appear to be pretty significant differences with the statement made by the hon. Gentleman.

I gather that the hon. Member for Reading (Mr. Mikardo) is going to answer this, or try to answer it, when the time comes, but I should like to suggest here that the fact that a union may not be affiliated to the T.U.C. is no reason why those who belong to it should not be entitled to be heard. It would be a pretty poor way, I think, in which to prevent the coming of a totalitarian state in England, which no doubt the hon. Member for Reading also wants to avoid, to deny the right of representation to a union which does not want to be specifically bound to any one party.

Mr. Beswick

Can the hon. Gentleman tell me the occasion when the British Airline Pilots' Association repudiated the arrangements?

Mr. Lennox-Boyd

I certainly understood that from their spokesmen and I can only go by that, that it is so. If the hon. Member has another view, however, he can say so when the time comes.

Mr. Lindgren

Their spokesmen upon this were the general secretary and president. What the hon. Gentleman said is not true; they are in favour of this move.

Mr. Lennox-Boyd

The hon. Gentleman must bring that fact forward so that the unions can argue it out among themselves. With the president of the N.U.R. and the other bigger unions to consider, that will provide, I imagine, pretty vivid headlines. All I am concerned with is that representative members of these unions assure me that it is so, and in regard to the A.E.A. it is certainly a fact that this union, comprising the majority of the workers, is wholly opposed to this amalgamation.

The word "redundant" is now rearing its head in B.S.A.A. affairs. My purpose in referring to the staff side was to hope that the Government—as they will naturally if they are prepared to carry out their intention—will be particularly careful to see that members of the smaller Corporation, to whichever union they belong, are not prejudiced. If this merger is carried out they will no longer have what the Lord President, who is now going out, reassured them of some years ago—alternative sources of employment. The Government ought to be particularly anxious and careful to see that their interests are safeguarded, for the word "redundant" never occurred in B.S.A.A. history until the question arose of the amalgamation with B.O.A.C. Let me add also that, though it is rumoured that the central headquarters staff of B.S.A.A. has increased enormously during the last year or so, there is very little, if any, effect on the engineering or air crew side which can be proved. The Minister said a short time ago—I think I am right in quoting him—that, in fact, they were if anything understaffed.

The second reason advanced by the Government for this proposal is the shortage of aircraft, and particularly the difficulties in which the grounding of the Tudor has placed B.S.A.A. Before the withdrawal of the Tudor they had 10 Tudors, I think, and 11 Yorks. I think those figures are correct. Of course, they were hoping for more Tudors. The hon. Gentleman did not really do very much to give the impression, which is the true impression, that in the field of aircraft construction we are now coming into our great period. I think we ought to remember when considering the difficulties with which B.S.A.A. are now confronted—and we need to let the world know—how their aircraft construction really stands. In the first Debate to take place in this House since the Hawker aircraft beat the London-to-Paris record and the London-to-Karachi record some reference should be made from both sides of the House to this fact, and to some of the types of planes now coming along which enable us, so far as construction is concerned, to have no fear of the future.

The S.R. 48, the Princess Flying-boat, the Bristol Constellation replacement, the Hermes, the Apollo, the Ambassador, the Viscount, the Brabazon I, and the de Havilland new Venture are giving us a technical lead, and it is the misfortune of B.S.A.A. that their particular troubles have come at this moment. What they want above everything else are planes to enable them to restore the highly profitable East to West route to the South American seas via Lisbon and Bermuda and Central America.

I am a little uncertain—it is rather difficult to follow—exactly what is to happen in that field. I gather from the Parliamentary Secretary that the route to the Caribbean and Central America will go, as now, via Newfoundland and America. It seems a little difficult to advertise a holiday in the Caribbean by way of Iceland. But then he followed it up by saying it was proposed to restore the Lisbon, Buenos Aires, San Diego route. If I am right in thinking this we, of course, are delighted, and we shall wish every success to the British pilots, under whichever name they may fly, who will be opening up that route again. At the same time, I suppose we are right in assuming that the Hermes aircraft will be based on Jamaica or Nassau for the South American west coast routes. That was the impression we got. Perhaps we were wrong. Perhaps, whoever is to reply to the Debate will clear that matter up.

On the general principle of the shortage of aircraft we still do not see why B.S.A.A. should not, with all the advantages of its own loyal associations and aircrews, retain aircraft or should not have been leased or sold aircraft to carry out these routes. If it is a fact that six Constellations and ten Stratocruisers can now carry on both the B.S.A.A. and B.O.A.C. North Atlantic services, we are entitled to ask whether B.O.A.C. orders were not excessive—if they can now do both. Or was this amalgamation decision taken long before anybody was told about it?

Mr. Lindgren

This is the most vital factor in the whole thing. Will the hon. Gentleman tell the House exactly what aircraft within the next three years should have been procured by B.S.A.A. to operate?

Mr. Lennox-Boyd

Of course, I cannot do that. I wish I could.

Mr. Lindgren

The hon. Gentleman apparently can.

Mr. Lennox-Boyd

How can one answer a question like that specifically? If I said a certain type of aircraft would be available next year and it were not, what would be the good? Only the Government can do that, or say what is required. Only the Government have all the information at their disposal. However, we are entitled to say that if B.O.A.C. without further orders can carry out the services of two Corporations, then when they first asked for these aircraft for one Corporation they were asking too much. If there is an answer we shall be very glad to hear it.

Mr. Lindgren rose——

Mr. Lennox-Boyd

I really ought to get on. I do not want to be the least rude when the hon. Gentleman gave way, but I myself have already given way what must be a record number of times.

The last of the aircraft is the flying boat. My hon. Friend the Member for the Isle of Wight (Sir P. Macdonald) who has taken a deep personal interest in the flying boat and has most consistently looked after the interests of the company, Saunders-Roe, and the interests of his own constituency and those of the people in British aviation, will ask more detailed questions about that. However, I cannot forget the attitude that B.O.A.C. have always taken up in regard to the flying boat. We welcomed the recent statement of Sir Harold Hartley and Sir Miles Thomas. Those of us who are his friends are particularly glad that the judgment of Air-Commodore Brackley—whose leadership of B.S.A.A. was, in the short period he lived, of such high quality—looks like being vindicated.

We were very glad indeed over the success of the Solent flying boats, and the approval of passengers is coming from many countries of the world. We realise that the Princess Flying Boat, with its longer range, will need fewer bases, and that, no doubt, will cut down the capital costs of constructing those bases. But we cannot forget that B.O.A.C. in October, 1947, refused the flying boats that had been ordered, which were then immediately welcomed by Air Vice-Marshal Bennett, whose decision on behalf of B.S.A.A. was confirmed in January last year. We hope that this order is safe, and that an Empire like ours, united by the sea, will use the sea in its own air communications. I should like also at the same time to ask the hon. Gentleman whether he will give some indication of what it is intended to do about the order for the six Comets to fly for B.S.A.A. and to be delivered in 1952 to 1953, and whether the new merger proposes to honour that order.

In conclusion, I would remind the House that I started by saying that it is our intention to break up this rigid system of monopoly. We are bound to judge the Government's actions by whether or not they make it more difficult for us to carry out intentions or not. Undoubtedly, this action of the Government removes means to compare achievement, and it increases monopoly, but as the Government's sands are running out so rapidly, its practical effect may be very small. None the less, we cannot share responsibility for it, so we have decided to vote against this Bill.

4.58 p.m.

Air-Commodore Harvey (Macclesfield)

I beg to second the Amendment.

When the Parliamentary Secretary made his announcement in this House regarding the merger some two or three months ago I said that I did not disagree with that statement. However, on reflection, and after going into the matter further, and after long consideration, I have come to the conclusion that the merger is not a good thing at the present time. That is my opinion. What the future will hold I do not know at the moment, but I do not think this proposal of the Government is right. The Parliamentary Secretary spoke, I thought, in a very generous vein about aviation, and I certainly intend to respect the line he took there. I disagree with him there on one point. He said that party politics should not enter into this subject. In past Debates we have tried to do what we could to put forward ideas likely to improve the working of the Corporations.

Of course, we on this side of the House firmly believe that the industry will not operate successfully while it is nationalised. That, of course, is politics, and I do disagree with the hon. Gentleman in that respect. It has been proved in other countries, and it is being proved in this country at the present time. We are told that the managements of the three Corporations want this merger. I can well believe they do; it may be convenient for many reasons. When things are not going well, when large deficiencies are being shown on the balance sheets, it is not a bad thing to have a reshuffle, and to start again next year, after three years' working. That is sometimes done in ordinary commerce, and I have no doubt that the Corporations may have something like that at the back of their minds.

The Parliamentary Secretary referred to the many advantages of the merger. He did not give us one disadvantage, although I am quite sure that he, who always tries to put forward the facts as he sees them, must know that there are disadvantages, however many advantages there may be in this proposed merger. One, of course, concerns the staff of B.S.A.A., both the aircrews and the ground engineers. It is well known that they very much resent this amalgamation. That is a disadvantage, to start with. B.S.A.A. started their operations some few years ago with almost every disadvantage that a new airline could possibly have, except that they had some good men on the management side. They had the disadvantage of taking on as aircrew men who had brilliant war records but with little experience of flying civil aircraft commercially. Those men have stepped into the job and proved themselves to be up to the mark, if I may say so, in every respect over what is generally known to be the most difficult route of all.

I was surprised, on looking back and reading the Government White Paper, Command Paper 6712. In spite of what the Lord President said in May, 1946, it was very specific in its wording. How are we to know when we shall get another Bill? I could have thought of several Bills to improve the Civil Aviation Act in preference to this one. In addition to that, we have had three Ministers of Civil Aviation, all with different views: Lord Winster, Lord Nathan, and now Lord Pakenham. That is quite a fair number in just over two years of operating a nationalised industry. The Parliamentary Secretary referred with some emphasis to the fact that he had already served for three years. Well, that is a record for his Department. Some of those Ministers interfered with this industry. Of course, the Minister has the power to do so, but there was interference particularly by Lord Nathan; and his very unhappy quarrel with Air Vice-Marshal Bennett did nothing to help B.S.A.A.

Hon. Members opposite have referred to the accident record of B.S.A.A. In the past I myself have asked Questions in the House and raised the matter in Debate; I am not anxious to cover up anything that has happened in the past concerning any aircraft operating company. It must, however, be recalled that B.S.A.A. have operated the most difficult route of all, and with very indifferent equipment. That must be borne in mind. Although the aircraft were inspected and passed by the Air Registration Board, their equipment was not suitable for the route—a point which I think was agreed by everybody—although it was the best that could be found at the time.

Furthermore, they operated from indifferent airfields, particularly on the West Coast of Africa. Also, there was a lack of radar equipment. Is it surprising that there should have been accidents? I certainly questioned the Parliamentary Secretary about the endurance and range of the Tudor, but I was assured by the chairman of the Corporation that there were adequate safety margins of operation. However, we do not want to go too far into what happened with the Tudor.

Let me now say a little about the loss of aircraft. I was surprised the other day that after the unfortunate accident of the K.L.M. Constellation aircraft there was one announcement about the loss of this large four-engine airliner, and that was all that was said. When there is an accident in British civil aviation it is headlined for weeks. I am told that the Lockheed Corporation, who manufacture the Constellation, have lost about 12 Constellations in accidents which have never been fully explained, one or two in the same area in which the Tudors were lost. Why is it that this country always gets the bad end of the stick in connection with accidents? I believe that this is the answer. K.L.M., within an hour or two of the recent accident, came out with an announcement that there was a bomb in the baggage compartment—[Laughter.] I agree it is a fantastic statement; if they knew there was a bomb there, presumably the aircraft would not have taken off. But that has never been denied, and it has been accepted by the public—the gullible public as far as aviation is concerned. I would ask the Parliamentary Secretary to press upon the Corporations to make a quick announcement when these unfortunate accidents occur in British civil aviation. I do not advocate following the example we had the other day, but I do ask that it should be got over quickly to the public.

I assert that the employees of B.S.A.A. do not want this merger. I thought the Parliamentary Secretary was a little unkind in his remarks to the Aeronautical Engineers Association. He may not agree with that particular association because they are not affiliated to the T.U.C. Nevertheless, I am told that a year ago about 91 per cent. of the staff belonged to that association. I do not know how many belong to it at the moment, but I have no doubt the Parliamentary Secretary could find that out. I should have thought that economies could have been effected in these Corporations without necessarily having the merger of the two we are considering today.

B.S.A.A. have a very fine record in efficiency when compared with the other Corporations, but they have had a succession of troubles from the beginning. First there was Air Vice-Marshal Bennett. I do not agree with his politics, but I have the greatest respect for him as an aviator. I think that he wanted a chairman who could keep a firm hold on him, who could keep him on the straight and narrow path, as it were. If that had been done, he was a man who could never have been replaced in this nationalised industry: he was brilliant, and I am sorry that he should have had this quarrel with Lord Nathan and gone out. He had great courage and tenacity; with the Tudor on the airlift he has achieved a very great performance in operating his aircraft, and has flown a large number of hours. Then followed the loss of Air-Commodore Brackley. That was a very sad loss, and I sometimes wonder whether, had he lived, this Bill would be before Parliament. I somehow doubt it.

I consider that B.S.A.A. cannot be blamed for what took place over the Tudor. It was not B.S.A.A. who asked for all the modifications to be made to that aircraft; B.O.A.C. asked for most of them. B.S.A.A. had to operate those aircraft; they took them because they could get no other aircraft. Nevertheless, on the airlift B.S.A.A., as well as Air Vice-Marshal Bennett, operated Tudors and put up a very fine record. For the benefit of the hon. Member for Reading (Mr. Mikardo), who is always getting at the charter companies for making enormous profits, I would point out that B.S.A.A. receive exactly the some rates for their Tudors on the airlift. I do not know whether he resents the Corporation being paid for doing exactly the same job that the charter companies are doing. He did refer to that some weeks ago, I thought rather unfairly.

Mr. Mikardo

It is quite untrue to say that I resent anybody being paid for the job done. The only comment I made on the occasion to which the hon. and gallant Gentleman refers was that the statements made paying tribute to the charter companies made it sound as though they had done all the work for nothing, and I thought that misapprehension ought to be corrected.

Air-Commodore Harvey

The charter companies have done exactly the same as the Corporation on the airlift, and I objected to the way the hon. Gentleman put it over at the time. I do not want to labour the point. I know he resents that the charter companies should even be making a living out of it.

The South Atlantic route, as was said at Question time today, offers great possibilities as a dollar earner, and I hope something will be done to speed up an arrangement whereby that route will be covered by modern aircraft. The Parliamentary Secretary said there was no economic aircraft with which to cover the route today, but if the "Tudor" was thought to be economic would not the "Constellation" be even more economical for that route? I should have thought it would have been a good thing to have put some "Constellations "on that route several months ago, and to have allocated two or three of them to B.S.A.A. to operate, instead of "Tudors."

We now come to the question of whether B.O.A.C. will have a division in the South Atlantic. My information is that the present "Constellations" operated by B.O.A.C. to Australia are operated by the Atlantic division of that Corporation. If that is so, what hope is there of maintaining a separate division for the South Atlantic? That is what disturbs me.

Mr. Lindgren

There are 11 aircraft altogether, six operating on the North Atlantic route and five purchased from Aer Lingus for general working with our good friends from Australia. Surely the correct thing to do, when there are 11 aircraft of similar type, is to maintain them at the same base. These aircraft are being maintained at Filton. All that the Western division does for the Eastern division is to maintain and crew aircraft, and hand them over for operating.

Air-Commodore Harvey

Provided that applies only to maintenance I withdraw what I have said, but I was told that it actually meant more than just maintenance of aircraft operating the route. I think it is a disaster that the B.S.A.A. team should be broken up, as undoubtedly it will be. Aircrews are going on to conversion forces in September. Nothing at all has been said about the ground engineers, the maintenance staff, and I should like to have an assurance from the Parliamentary Secretary that there will be no redundancy among these men. There is very little fat on B.S.A.A. today; the Corporation has been run in a very economical way, in so far as staff are concerned. It is feared that the men to be merged into the larger Corporation will find themselves out of work, and if the Parliamentary Secretary can make an announcement which will satisfy these men it will give great relief.

A year ago B.S.A.A., who were expanding at that time, had a staff in London of about 170. Today, it is approaching 400 to 500. Is this to continue? With the country in an economic crisis such as we are faced with now, we cannot afford to have Corporations run in the way in which they are being run. We are told that economies have taken place, and are taking place, which I do not doubt, but there are many men in these Corporations who could well be dispensed with and I hope the Minister will impress on the managements of the Corporations, when the Bill becomes law, as it undoubtedly will, the need to bring about real and effective economies. If they do not, then the savings and economies which are expected will not be effected.

I should like to refer briefly to the "Princess" S.R.45 flying boat. Having talked to engineers of Messrs. Saunders Roe, I believe that the British aircraft industry has something really good in this aircraft, something which, so far as we know, the Americans have not got. It is promising well, and I believe that when it comes into operation it may attract a tremendous amount of traffic. I would like to feel that the Government intend to place an order for an additional four flying boats—if I may put that point especially to the Minister of Supply, who is having a doze at the moment. I am sorry to disturb his rest, but I must tell him that Messrs. Saunders Roe would be much happier if he could say that another four flying boats had been ordered. I hope some decision will be taken in the near future on this matter.

B.S.A.A. have always been flying-boat minded. It was thought that B.O.A.C. were not, but my information is that they are becoming more flying-boat minded now, and I hope that Sir Miles Thomas, whom I wish well in his new post as chairman, and Mr. Whitney Straight, on the operational side, will see that those under them learn something about the advantages of flying boats, and that this great venture gets a real chance in operation. I was told that flying-boat berth No. 50 at Southampton was equivalent in cost to 200 yards of the runway at Filton. That is a problem. I am pointing out the merits of the flying boat because B.S.A.A. were most keen on making a success of that side of their flying operations.

We were told by the Government that there was an estimated loss for 1949–50 of £5½ million between the Corporations. I should like to know how that will be split up under the new arrangement? I believe that B.O.A.C. have acted prematurely in this matter of merging with B.S.A.A. I do not want to bring in personalities, but I believe that some of the more senior staff of B.S.A.A. have already moved their offices into B.O.A.C. premises. I do not believe that Parliament enacts laws to see them flouted by nationalised industries or anyone else, and it would have been far better if these people had heard or read what was being said today before acting like a rubber stamp. It is a slur on Parliament that such action should have already taken place.

As I say, engineers are against this merger and so are aircrews. I should like to know who is for it other than the managements? It seems that the Government are for it because it may be convenient when further losses are incurred. They eventually want one Corporation; I believe they want to get the whole thing under one administration, so that they can do what they like with aviation. In the meantime, I wish the operating side of the industry well. It has a great chance, though there are tremendous difficulties ahead. We can ill afford extravagance and wrong decisions. If it is necessary now to have one Corporation to cover the North and South Atlantic routes, it was necessary a few years ago. Things have not changed to that extent. I hope the Parliamentary Secretary will be able to give us an answer to the points which have been put to him today.

5.19 p.m.

Mr. Beswick (Uxbridge)

We have heard a most reasonable speech from the hon. and gallant Member for Macclesfield (Air-Commodore Harvey) with some most interesting details. I do not propose to follow him in the detailed points he made except in two respects: I must say I think he found original ground for criticising the Government when he said that they did not account for the loss of our aircraft by claiming that bombs had gone off in the plane. I do not know who the hon. and gallant Gentleman expected to deny that unlikely K.L.M. story, unless it was the man who was supposed to have put the bomb in the aircraft. I was also surprised by his statement that on that side of the House they did not think nationalised airline Corporations could pay. If that is the case I am surprised that they set up B.O.A.C. in the first place.

Of the hon. and gallant Member for Mid-Bedford (Mr. Lennox-Boyd) I would say this. I do not know whether he was in this House until 6 o'clock this morning with the rest of us, but if he was, I must certainly congratulate him on the energy and enthusiasm he conserved for moving this Amendment. I particularly admired his energy, because I really cannot believe that he agreed with the main point of his argument. The main point of his argument was that here was this Labour Government breaking up the competition which had existed between the three airline Corporations. But when the Civil Aviation Bill, 1946, was before the House, the hon. Member for Mid-Bedford said that the Socialist Government's proposals set up a monopoly of three Corporations which had no shadow of independence whatever. I hope shortly to show that they are but three branches of a Government concern with their separate boards pure eyewash."—[OFFICIAL REPORT, 6th May, 1946; Vol. 422, c. 620.]

Mr. Lennox-Boyd

Since the hon. Member has quoted me, may I point out that that is exactly what is appearing to be the case, and that this Bill is giving legislative expression to the doubts I expressed at that time?

Mr. Beswick

What the hon. Member actually said was that the existing state of affairs gave us no competition whatsoever. He said that the three separate boards were "pure eyewash." If it be the fact that the three separate boards are "pure eyewash," I fail to see why he comes along after an all-night sitting and with such energy opposes this Bill. I think that his energy was rather misplaced.

Having said that, I am bound also to say that I was sorry this merger was deemed to be necessary. I was sorry because the reasons given by the Lord President of the Council, and reiterated by the Parliamentary Secretary this afternoon, about the necessity for these three Corporations in the first place still hold good in my judgment, despite what the hon. Member for Mid-Bedford said in the Debate in May, 1946. I am not satisfied that in the comparatively short experience we have had since the war, any one of the three Corporations has developed either the perfect administrative technique or has thrown up, as we hoped that in time it would, the airline executives to whom we can safely consider handing over a larger sphere of organisation. I believe that in recent months all the Corporations, including B.O.A.C., have made very strenuous efforts to evolve the administrative efficiency which we demanded. But it still seems to me that B.O.A.C. have many problems to settle themselves without having to take on the additional responsibility of the South American routes.

But if the Parliamentary Secretary comes down to the House and says that the two Corporations, the National Joint Council of the Industry, and the Minister's advisers all declare it is impossible, with the aircraft available, to operate the routes which were formerly operated by B.S.A.A., and B.O.A.C., then I must admit that they are in a better position to examine the details of the situation and that I have to accept their decision.

I will make only one point about this question of the agreement of the employees. I feel there is some ground for criticism of the management in so far as they have not put over to the employees of B.S.A.A. all that is involved. It was quite clear even from one or two of the remarks of the hon. and gallant Member for Macclesfield about what he thought the set-up along the routes would be, and from the question put by the hon. Member for Worcester (Mr. Ward) that there is considerable misunderstanding as to what exactly the plans of the new Corporation are. In that respect, at any rate, the two Corporations, B.S.A.A. and B.O.A.C., especially the former, have failed in their responsibility to explain to the employees exactly what is the situation.

What seems so important now, if we accept this merger, is the kind of administrative organisation which is to follow on. Perhaps I may be allowed to indicate the kind of pattern some of us on this side put forward for the air transport industry three or four years ago, and then see how far this new Corporation can fit into the pattern we envisaged. Firstly, we asked for one air transport authority to centralise policy making. We also asked that underneath that policy-making authority there should be a number of separate executive organisations responsible for appropriate geographical areas. We never accepted the fact that the three Corporations set up under the 1946 Act were the ideal divisions of responsibility.

It seemed quite clear that B.S.A.A. was too small. The shape of that particular organisation was laid down by the private enterprise companies who were responsible for the original plan, and had it not been for that I am certain that we should have had a different shape in the first place. Similarly, I think it can be argued, and was argued very successfully, that B.O.A.C. were taking over too big an area of responsibility; we might then have had two separate divisions underneath the air transport authority. Thirdly, we envisaged that these separate Corporations—I must emphasise the fact that there is often a good deal of confusion in these terms used, because the type of Corporation to which I am referring might well be what is described in other occasions as a "division"—would develop certain functions in common. For example, there were clearly advantages to be gained from centralising servicing and maintenance.

It may well be that the new structure envisaged in the present Bill may fit into the pattern which some of us put forward two or three years ago. In that case, I would put forward one or two points which will have to be watched. The first is that if this new and enlarged Corporation is to be responsible for policy, then that responsibility must be clearly laid down. The relationship to the Ministry must be much more sharply defined. We must clearly say that either the Ministry or the Corporation is responsible so that we know exactly where we stand. At the present time no one is quite sure who is to be blamed or who is to be praised for a decision; in fact, no one knows who is making the decision. I admit that there was a necessity when the present Minister took over for a good deal of active participation in the airline Corporations, if for no other reason than that they were being paid considerable sums of public money. If it is said that these subsidies will continue to be necessary, and if the Minister is, as a permanent role, to take active and almost day-to-day interest in the administration of the Corporations, then I feel that this new Corporation might very well be reduced in size, eliminating the part-time people, and so become, in other words, an executive body under the policy-making Ministry.

Let me say at once that this is only one alternative, and that it is not the alternative I personally should like to see. I should like to see this new Corporation becoming the policy-making body and gradually the Ministry of Civil Aviation would become redundant. When we decide which of these two alternatives, either the Ministry or the Corporation, is to make policy, then in my judgment we should retain under this policy-making body some divisional pattern, and one of the divisions should be the South American Division, I am still certain that we have got to have these separate organisations, in which different types of people can work, carry out their ideas, approach different problems in their own way, develop their own team spirit, and work out new techniques. In this way we will have something to compare.

I hope it is possible to do something of that kind even if certain functions such as maintenance are shared in common, so that each division can maintain a personality and a technique of its own. I hope that in the accounts that are presented it will be possible to judge between one division and another to see which is doing well, and what people are doing well. I would hope that those accounts would be available, not simply to the Board of the Corporation or even to the Members of this House but to the public generally.

May I make just one or two further points, and here I agree with something which was said by the hon. and gallant Member for Macclesfield (Air-Commodore Harvey). I am still certain that the industry must get out of what was described in this House as the "cocktail-party habit." There is still far too great a display of needless ostentation in this industry. Recently I had the opportunity of seeing something of the United States airlines, and one of the interesting developments there is the new sky-coach. In so far as the American domestic airlines are doing better, much is due to those new austerity services. They have cut out many of the frills, and are now carrying twice the number of passengers at pretty well half the price. As the hon. and gallant Member for Macclesfield said, in many spheres of our activities, even including our social services, we have got to adopt a policy of austerity, and I feel that the directors and management of these airline Corporations ought to cut out some of the luxury especially in administration. Incidentally, what I have said in relation to the airline Corporations might very well be applied, and even more so, to the aircraft-manufacturing industry.

Finally, I make two last points. I hope the endeavour of the hon. Member for Mid-Bedford to stir up an element of uncertainty with regard to the future of B.E.A. will not succeed. What we require now in this industry is time to settle down and finish with the uncertainty and instability which different changes have inevitably brought about. Lastly, I hope we have seen the end of that period which necessitated bringing in men from outside and putting them at the top of these different Corporations. I hope that as we come within this more settled period, we shall see young people from within the services rising to the top. I trust they will be given full responsibility to develop their professional craft. If that can be done and the other points I have put forward are observed, I am quite certain that the progress which has been made in this industry in recent months can be accelerated, to the benefit of the taxpayers and of this House, and to the great satisfaction of the men and women who work in it.

5.35 p.m.

Sir Peter Macdonald (Isle of Wight)

As one Member of this House who has always looked upon British civil aviation as one part of the transportation problem, and has always advocated the setting up of a Ministry of Transportation, I support the argument of the hon. Gentleman the Member for Uxbridge (Mr. Beswick) when he stresses that that course should be adopted eventually and the present Ministry of Civil Aviation should become redundant. That I hope will be the course of events in the not-far-distant future. In saying that, I am sorry that this Bill sees the passing of one of the three branches of civil aviation which was more likely to assist the coming of the Ministry of Transportation, because when the original set-up of the civil aviation organisation after the war was reached, this idea was very much in our minds. Behind it was the hope of combining road, rail, sea and air transport.

Mr. Booth, who is now the deputy-chairman of the British Overseas Corporation, was brought in, and through his activity and enterprise he got this Corporation, B.S.A.A., going. Then the Socialist Government came into power and threw over Lord Swinton's policy. Nevertheless, Mr. Booth and Air Vice-Marshal Bennett showed tremendous enterprise and displayed great skill in overcoming tremendous difficulties in the way of operational aircraft and so forth, and they got this Corporation organised. I regret very much to see the passing of this Corporation for this reason, and because so many people in it were brought up under private enterprise.

They have shown themselves capable of effectively running not only shipping companies but this Corporation, which was able to show a paper profit during the time they have been in control, although it might be said that it was a very flimsy profit and based on some miscalculations. If one went into the figures too closely and found out what was paid for the hire and purchase of aircraft compared with other Corporations, it would reduce the margin of profit to very small limits if, indeed, one existed at all. That is by the way. The fact remains that the three Corporations are being reduced to two, and my hon. Friend the Member for Mid-Bedford (Mr. Lennox-Boyd) was anxious to know whether this was the prelude to two being reduced to one, which is exercising the minds of many people in this House.

The last time civil aviation was discussed in this House, I strongly criticised the expenditure of the Corporations. I pointed out that B.O.A.C. was greatly over-staffed and there were far too many bodies in connection with the Ministry of Civil Aviation, which was also greatly over-staffed, and that they were only an embarrassment to the Corporations, who were trying to get on with their operational job. I was a member of a Select Committee, which inquired into civil aviation. It was in operation only for a short time. We could not get the true facts at the time, and another inquiry has taken place since then.

We have got enough facts to prove to us that there is gross overlapping, and that there is tremendous room for reduction in expenditure. That is why, when I spoke on this matter on the last occasion, I recommended that that course should be taken. It was not obvious with the British South American Corporation, because they approached their job as a business man would do, and built from the bottom upwards. They built as they went on. On the other hand, B.O.A.C. and British European Airways took on an enormous staff and went in for expansion, but they had to contract almost immediately, with the result that 5,000 people were thrown out of employment and very great hardship and bitterness were caused in the minds of people who had been given to understand when they came out of the Forces that they would have steady employment for the rest of their lives.

The result of the Bill will probably be more redundancies and more people thrown out of jobs. If that is necessary for efficiency and economy, by all means let it be done, but do not let it all fall on the staff of British South American Airways. They are afraid, as they are being swallowed up by an organisation 20 times their size, of being the people who are to be thrown out of work and made to bear the burden. I hope that the Parliamentary Secretary can give an assurance to these people, who have built up British South American Airways with an esprit de corps that does not exist to anything like the same extent in the other Corporations. They are small in number, comparatively, and they have been led by men with tremendous enthusiasm who have had vast problems facing them all the time. They have all been very keen on the operational side.

Apart from that, I would like to know what the future operations of the organisation will be, particularly in regard to aircraft. We were told by the Minister that the chief reason for the amalgamation was connected with problems of aircraft, but no mention was made by the Minister of the new types of aircraft that are coming on. My hon. Friend the Member for Mid-Bedford referred to certain types of machines and other references were made by my hon. and gallant Friend the Member for Macclesfield (Air-Commodore Harvey). I went down with various Members of the House to see a job of aircraft production being done, and all the party expressed their very sincere desire to see the job gone on with, because we had in the S.R.45 something which no other country in the world had in the way of aircraft.

When the announcement was made about the amalgamation of these two Corporations, fears were expressed about the future. The aeroplane firms could not help remembering an order which was issued for a fixed number of aircraft. Progress was being made in the production of the machines when suddenly, out of the blue, the producers were told that the order was to be cancelled. The reason was that the B.O.A.C. found that they could not continue to operate seaplanes on the Atlantic routes. The order was to be dropped altogether. The firms were very upset about this matter, naturally. Air Vice-Marshal Bennett went down to look at the machines and said that they were exactly what he wanted. He persuaded the Ministry of Supply to order them. It is natural that the firms concerned should want to get an assurance from the Minister that the aeroplanes which have been ordered will be proceeded with.

In another place the Minister of Civil Aviation made a statement that seven aircraft were being ordered. I understand the policy now is that three of that seven are to be gone on with and that the other four will be held in abeyance. A certain amount of work has already been started on the four, on the assurance which was given that it was a firm order. Losses may be incurred, and many men are going to lose their jobs, because certain sections of the firm's factory will have no work until the remainder of the order is confirmed. That is a very serious thing at the present time for Cowes, which is in my constituency. Three firms are concerned there, and one of them has practically finished with the order now. They have laid off many of their men, some of whom are the most highly skilled craftsmen in the world. They have their homes in Cowes and it would be most unfortunate if they were lost to us. They have a record which is second to none in the country. They are being thrown out of their jobs because of a delay in the order for the aircraft. I would like an assurance from the Parliamentary Secretary that the order for the three machines will be continued and that the order for the other four will be confirmed at the earliest possible moment. I do not want the impression to go out that the firms in question are up against the B.O.A.C., with which they always had the happiest relationships. They recognise that the B.O.A.C. has far more experience with British flying boats than has British South American Airways.

Mr. Lindgren

What is all the crying about, then?

Sir P. Macdonald

I am not crying at all. It is said that there is a possibility, as it occurred before, of B.O.A.C. deciding to cancel the orders for the flying boats.

Mr. Lindgren

I deprecate the statements which are being made. All the time there is the inference that some evil spirit in B.O.A.C. which will "dish" flying boats. B.O.A.C. are the only operators who have ever operated flying boats. As for talking about B.S.A.A. being the flying-boat champions, they have never seen one.

Sir P. Macdonald

I believe that some people in B.O.A.C. have a prejudice against flying boats. We know it from past experience. I believe it is largely due to a misconception. They have the idea that ground operations in connection with flying boats are far more costly than with land planes. That is not necessarily so. We certainly do not have to spend millions of pounds on new runways in order to launch the flying boats because it is hoped to launch them in Southampton Water without any assistance at all. The prejudices are not created by B.O.A.C or B.S.A.A., but someone has computed costs of servicing facilities for flying boats which costs are considered quite fantastic by the people who know flying boats, and who maintain that very expensive installations are unnecessary for the operation of the modern flying boat.

It is hoped that before any very expensive installations for these flying boats are begun by the Government the benefit will be obtained of experience in their operation by people who understand flying boats. The figures already prepared have been got out by people of the Ministry of Civil Aviation who probably do not know the first thing about flying boat operations. There is this feeling in the minds of the people who are responsible for this enterprise that there is a danger of the same thing occurring again, and I hope that the Minister will give the assurance for which we have asked and take steps to see that the order is completed and that work can proceed on the other four aircraft.

5.54 p.m.

Mr. Ernest Davies (Enfield)

The hon. Member for the Isle of Wight (Sir P. Macdonald) adopted a more consistent line in his arguments than did his hon. Friend the Member for Mid-Bedford (Mr. Lennox-Boyd). I would point out, however, that B.S.A.A. only succeeded in making a profit in its first year of operations. Another hon. Member also suggested that B.S.A.A. has continued to make profits, but for the clarity of the record it should be pointed out that last year the Corporation made a net loss of £421,000 and had to fall back on an Exchequer grant of £260,000. The hon. Member for the Isle of Wight will admit that if B.S.A.A. continued to operate on their previous basis, in view of the most unfortunate loss of their aircraft, substantial losses would be suffered by them, and in view of the way it is now being compelled to operate, clearly very substantial losses are being incurred.

The hon. Member for Mid-Bedford was not consistent for the reasons which my hon. Friend the Member for Uxbridge (Mr. Beswick) gave. I do not believe that the hon. Member convinced the House by his interruption of my hon. Friend. When the Opposition opposed the 1946 Bill, they did so mainly on the ground that it prevented free competition, and they argued very vigorously that the three Corporations which were being set up did not permit competition. It was possible so to argue. I remind the hon. Member for Mid-Bedford that he said: To talk as if these three corporations, geographically limited to separate parts of the world, can provide competition to each other is surely a ludicrous assumption."—[OFFICIAL REPORT, 6th May, 1946; Vol. 422, c. 618.] Nothing could be more definite than that. His hon. and gallant Friend the Member for Pollok (Commander Galbraith) during the Third Reading said this, which is stronger. He argued that far from setting up three independent Corporations, the Bill set up three Corporations which were tied hand and foot, and placed sole responsibility on the Minister. If hon. Gentlemen opposite are now to argue that what they call "this drastic amendment of the Act" will lead to a restriction of competition, they must in all honesty admit that their arguments in 1946 were wrong, and they are not willing to do that. Has the hon. Member for Mid-Bedford failed to appreciate the advance in thought in civil aviation since the time of the Swinton proposals, and does he still believe that it is possible to return to free competition in civil aviation? Surely he will admit that the history of civil aviation, not only in this country but in many other countries, shows that any attempt at a marriage of free competition and private enterprise with public regulation and public money has failed and has had to be dissolved.

Air-Commodore Harvey

No.

Mr. Davies

It has happened in this country, and no argument has been advanced to indicate that it is possible to return to that situation.

Air-Commodore Harvey

Has the hon. Member seen the balance sheet published by Swiss-Air in the last week showing not a big profit but nevertheless a net profit on the year's working?

Mr. Davies

What competition is there inside Switzerland against Swiss-Air?

Air-Commodore Harvey

It is all external.

Mr. Davies

Our position is that we must face the fact that owing to a series of misadventures B.S.A.A. has lost the ability adequately to serve the Latin American countries, that for reasons for which it is in no way responsible—we pay tribute to its record in many particulars—it has now lost its traffic and a very large amount of the goodwill, and that whatever its past success has been, so far as the future is concerned, it is now severely handicapped. What we have to ask is how air communications between this country and that continent can be restored by the quickest means, and how they can be established efficiently and economically, and ultimately extended.

The answer has been given most convincingly by the Parliamentary Secretary. The arguments put forward by the Opposition have in no way succeeded in demolishing his case. The test must surely be whether the merging of these two Corporations in any way interferes with the Government's declared aim about civil aviation and if it does not interfere, whether it in any way furthers it. Our aim clearly is to establish the most economical and efficient operation of civil aviation along commercial lines. In view of the circumstances, the merger which is now taking place is the only way in which that can now be established. The Opposition should remember that on the establishment of the three Corporations not only was there no real enthusiasm for the three Corporations by the Opposition but stress was laid on the fact that it might be a temporary arrangement and that there was nothing permanent about the establishment of three. For instance, the Lord President of the Council said at the time that if future experience should show that three were too many, and that two or even one would be enough, modification could be made. In the White Paper it was clearly pointed out that the arrangement proposed was a flexible one.

While I think the case for this Bill has been adequately made out, and I do not see any alternative to the merging of these two Corporations in view of the combination of circumstances, I think it gives an opportunity for the Minister to re-examine his relationship to the Boards, and the administrative relationship between the Ministry of Civil Aviation and the two Corporations which will exist after the passage of this Bill. Up to the present the relationship between the Minister and the Corporations has been far closer than we were led to believe would be brought about when the Bill was discussed before this House. In all fairness to the Opposition, one can say that they argued that the Minister was given wide powers and would, in effect, direct these three Corporations. Although he has done so, he has not done it by using the powers given in the Act, but by more informal and consultative means.

Mr. Lennox-Boyd

Sacking the Chairman.

Mr. Davies

I believe that some difficulties from which the three Corporations have suffered have in part been due to the ill definition of this relationship, and uncertainty as to where the actual responsibility lies; that in all the public Corporations set up there is established the principle that the Boards appointed by the Minister shall be independent as far as possible of interference in day to day administration, and that the appointing Minister shall only have the powers provided in the Act—that is the general directing power when it is necessary to exercise it in the public interest. In this respect the Civil Aviation Act did not differ from other nationalising Measures except that, in so far as civil aviation would have to be subsidised, there was provision for providing the Minister with estimates of expenditure and revenue and their programme.

Quite clearly, however, all public Corporations, including those set up by the Civil Aviation Act, are theoretically operationally independent of the Government and not subject to Ministerial interference except to the extent that the Minister can give directions. In the case of civil aviation, rightly or wrongly, it is clear that the Minister has interpreted the national interest as affecting the whole operation, policy and planning, including the day to day administrative affairs, as being in the national interest. The Boards have consequently been deprived to some extent of that freedom of action and willingness to exercise enterprise and initiative which they might have shown had they been left freer from interference from the Minister or the Ministry of Civil Aviation. On paper there is no question that the Boards are responsible equally for policy and planning and general operations, but in practice the Minister has assumed a voice in those functions. That has had a restricting effect on the general development of civil aviation in this country. The Minister has, in effect, become more of the managing director or chairman of the Civil Aviation Corporations than simply the Minister using his powers rarely, and only when necessary in the public interest.

What I am fearful of is that after this merger takes place, if that situation continues, the new board might continue to be somewhat inhibited, possibly frustrated, through the lack of definition of its relationship to the Minister and where its responsibility begins and ends. It will be looking over its shoulder continuously and acting cautiously for fear of interference or because of the necessity to consult the Minister at every stage. I suggest that we have to make up our minds either that the Board has to be free from Ministerial interference, except in the directions laid down in the Act, or that it shall come under the direction of the Minister completely. In other words, the compromise which has been reached in the case of civil aviation cannot work as effectively as can either complete freedom from interference or operation as a Department of the Minister. As far as administration of nationalisation is concerned, we have either to revert to direct departmental control along Post Office lines or maintain that freedom for operations which was originally intended and provided for.

A strong case can be made out in the case of civil aviation for the operation of the Board more as a Department of the Ministry of Civil Aviation than as an independent board. The reason why I advance that is because I think there is a difference between an industry free from subsidy and dependent on public money for its successful operation, as is civil aviation, and those nationalised industries which are supposed to operate commercially successfully and to pay their way. So, while I do not think one can reach final decisions on this matter, with this merger taking place, the time has come for the Government seriously to reconsider the question of the operation of civil aviation either as a Department or with greater freedom, and to bear in mind the fact that there is a difference between those industries which are subsidised and those which do not require subsidisation.

As I have stated, I think this Bill is necessary in view of the special circumstances which have arisen. We now have an opportunity of starting a new chapter in civil aviation development, and if initiative and enterprise is left to the Board, then we shall have a new era of success.

6.9 p.m.

Mr. Ivor Thomas (Keighley)

The hon. Member for Enfield (Mr. Ernest Davies) has over a good many years given much attention to the proper form of organisation of a socialised industry, and he always writes and speaks interestingly on that subject. I agree with him that the most unsatisfactory feature of nationalisation so far is the undefined nature of the relations between the Ministers and the public Corporations. There have been many occasions on which I have felt exactly as he feels, and I expect this feeling has been given expression in the records of the Ministry of Civil Aviation. I would only say now that the person to whom his remarks ought to be addressed is unfortunately not in the Chamber, namely, the Lord President of the Council, who is the theoretician of the Labour Party on these matters.

I have tried to keep civil aviation, like the Colonies, out of the wide area of my disagreement with the Government. But I have been so intimately involved in the setting up of the three airline Corporations and I feel so strongly about the virtues of having more than one Corporation that the House will not expect me to be silent this afternoon. I can assure the Parliamentary Secretary, however, that if I say some hard things it will be without malice and in a spirit of personal friendship to himself and to his noble Friend. I should also like to make it quite clear at the outset that, while I may have some criticisms to make of B.O.A.C., it is, despite its faults, the greatest airline in the world. When it leaves the ground it is superb; it is unsurpassed. Any criticisms I have to make relate to B.O.A.C. as chairborne, and not airborne. It is equally true that if I speak of the virtues of B.S.A.A., I am not unconscious of the defects which that organisation has also shown.

In my view the greatest need for civil aviation is peace in our time. I expressed that view on 26th February, 1948, and since that date there have been a very large number of convulsions in British civil aviation. I do not see how we can make any progress in the field of civil aviation if we are to have these continual changes. The story of British civil aviation since 1945 is a melancholy record of the intrusion of party prejudice into air commerce; of the triumph of dogma over common sense; of the victory of the crank over the expert; of the dominance of a small but determined party caucus over a feeble and ill-informed Cabinet.

The story began immediately after the advent of the present Government to power. Lord Winster and I had then to decide what policy we should recommend to Parliament for the organisation of British air services. We found that plans had already reached an advanced stage for three airline Corporations: one, the existing British Overseas Airways Corporation; the second, for services to Europe; and the third, for services to South America. Railway interests were to have a dominating share in the second and in the third a dominating share was to be taken by shipping interests. That was the position we found when we came into office. In order to get British aircraft flying the air routes of the world as quickly as possible, we decided to adopt this structure in its general outlines. Its threefold nature commended itself to us in any case on merits. But in the light of the general endorsement given to public ownership at the General Election we decided to require that in the European and South American Corporations there should be a majority public holding. B.O.A.C., of course, was already publicly-owned in its entirety. I may add that the existence of the overseas rights already negotiated by British Latin American Airways, which has been referred to by the Parliamentary Secretary, was a minor factor in coming to that decision.

Looking back in the light of the sorry experience of the subsequent years I am more than ever convinced of the soundness of that policy. The railway and shipping interests accepted without demur the insistence on a majority public holding and would have co-operated wholeheartedly with us. The adoption of the general outline of the Swinton plan would have enabled the Opposition to have co-operated with the Government, and civil aviation could have been lifted out of party politics, with which it has nothing to do. I was very glad to hear the Parliamentary Secretary this afternoon ask that we should treat civil aviation not as a matter of party politics. Unfortunately, however, when I have completed my record tonight, it will be only too obvious how party politics have entered into this matter.

The existence of the three Corporations would have provided a measure of emulation—of "Socialist emulation," if that expression is preferred—and a yardstick to test efficiency. The presence of private money alongside public money would have been a check to the profligate administration which has already cost the taxpayer about £30 million.

Mr. Mikardo

The hon. Member did not say that in 1946.

Mr. Ivor Thomas

I am saying that I did. That was the plan which, after mature consideration, Lord Winster and I put forward to the Cabinet. I propose to tell the House now why that plan was not adopted. But before doing so let me only say that we could have saved months of precious time, and, as part of a united national effort, we could have had British aircraft on the world routes before those of any other country except the United States if that plan had been adopted. But what happened when Lord Winster presented this well-conceived plan, with the unanimous backing of well-informed opinion, to the Cabinet? In the first place, we discovered that the real power lay not in the Cabinet, but we were referred to a group of back bench amateurs comprised in the Civil Aviation Committee of the Labour Party. That body produced an egregious document called "Wings for Peace," which, they said, had been approved by the Labour Party Conference. I read the document. Never have I seen so much nonsense contained in so few paragraphs. It was the work mainly, I believe, of the hon. Gentleman the Member for Reading (Mr. Mikardo).

Mr. Mikardo

That reveals the soundness of all that the hon. Member for Keighley (Mr. Ivor Thomas) is now saying. I had no part in the preparation of that document and did not write a single word of it. That is a measure of the reliability of the information and arguments now being put before the House by the hon. Member.

Mr. Ivor Thomas

Naturally, I accept what the hon. Member says——

Mr. Mikardo

The hon. Member has no alternative.

Mr. Ivor Thomas

I made it clear that, at this point, I was referring to matters outside my own direct knowledge. The hon. Gentleman certainly had a great deal to do with the advocacy of that document. Transport House could not supply me with any proof that the Labour Party Conference had in fact ever approved the document. If it was so approved, as I must assume was the case, it was presumably, right at the end of the Conference whilst such delegates as remained were singing "The Red Flag."

Mr. Rankin (Glasgow, Tradeston)

I want to be specifically clear on one allegation or statement which the hon Gentleman has made. He says that a Minister of the Government and himself approached the Cabinet with a well-conceived scheme and that instead of considering that scheme and coming to a decision on it the Cabinet referred him to a group of back benchers. I happen to be one of that group, and this is the first occasion I have heard of that happening.

Mr. Ivor Thomas

If the hon. Member considers the matter he will realise that, obviously, he did not know as much as I did on the subject. I have chosen my words very carefully and I adhere to them. I want to make it clear that this is how public policy has been formed under the present administration.

Mr. Rankin

Would the hon. Member say whether or not this procedure actually took place and that the Cabinet directed him to do as he says?

Mr. Ivor Thomas

I have given my statement to the House and have said that I have no reason to withdraw a single word of it. The hon. Gentleman can read it again in HANSARD. The main facts were, indeed, correctly set out at the time in an article by Mr. Courtenay Edwards, in the "Daily Mail" of 3rd November, 1945, under the heading, "Rebels changed the Air Plan." As neither Lord Winster nor I have spoken a word in public about this miserable business to this day, I presume that the information came from the rebels themselves.

Mr. Mikardo

Why did not the hon. Member resign?

Mr. Ivor Thomas

That question was, naturally, very much in my mind. The conditions in which a junior Minister should resign have been laid down by the right hon. Gentleman the Member for Woodford (Mr. Churchill), and they are exceptional. A Minister who is always threatening to resign is very tiresome. Lord Palmerston certainly said that he had set his chimney afire with Mr. Glad-stone's letters of resignation. That may be considered a good precedent but the general view is that resignation is an ultimate, and not an immediate, weapon.

Mr. Mikardo

The hon. Member left it too late.

Mr. Ivor Thomas

After mature consideration I have put the House in possession of these facts as this raises questions far wider than civil aviation affecting the whole nature of government in this country since 1945. This is how the industry came to be nationalised. I would only observe further at this point that when the Civil Aviation Bill was drafted the rebels did not have it all their own way. By not forbidding private enterprise companies, and by leaving a wide field of aerial work open to them, and by leaving open the possibility of using private enterprise companies as agents for the Corporations, it would in fact be possible to carry out any policy desired by the Government of the day even to the point of complete denationalisation.

Mr. Beswick

If that is the case, will the hon. Member tell the House whether, when he used the following words on 6th May, 1946, he was being compelled to do that contrary to his own judgment and his own conscience? The hon. Member said: Today, over a wide field, private enterprise has exhausted its utility and become a stumbling block to economic advance."—[OFFICIAL REPORT, 6th May, 1946; Vol. 422, c. 728.] Am I to understand that in using those words he was using words with which he disagreed?

Mr. Ivor Thomas

I have made it abundantly clear on many occasions that there is a proper field for public enterprise and a proper field for private enterprise. We have been reminded this evening how a Conservative Government set up B.O.A.C. in the first place. If the right method had been adopted in the first place, it would have enabled us to get the air routes of the world much more quickly and would have saved millions of pounds of the taxpayers' money. I could give many more instances of the way in which a weak Cabinet have yielded to the dictates of their back bench masters, but perhaps that is enough for this evening. The Minister's portfolio has been passed practically along the whole thin red line of Socialist peers——

Mr. Deputy-Speaker (Mr. Bowles)

This has nothing to do with the Bill before the House.

Mr. Ivor Thomas

I am sorry if I have not made myself clear, Mr. Deputy-Speaker. I was about to say that each new Minister has felt it necessary to have an orgy of purging and these continual changes are very upsetting for civil aviation. It is particularly unfortunate that the present Minister, for whom I have great respect, has felt it necessary to make this fundamental change once more in British civil aviation. If that is out of Order, I should be very surprised. The rebels to whom I have referred were almost as strongly opposed to three Corporations as they were to the inclusion of private money in the scheme. In their joy at getting nationalisation of scheduled services, they did not press the point at that time, but the Labour Party, as made clear by the hon. Member for Enfield this evening, has always had a hankering for one big Corporation and that hankering has now triumphed. Despite much talk about not having——

Mr. Ernest Davies

I appreciate the hon. Member giving way. I should like him to inform me when I made a statement to that effect. I made no reference to the formation of one big Corporation.

Mr. Ivor Thomas

I am sorry if I have misunderstood the hon. Member. Other hon. Members have expressed this sentiment, and I understood him to have approved the idea of one big Corporation. If I am mistaken, of course I withdraw at once; but I repeat that the party opposite have always had a hankering for one big Corporation. In fact, the Labour Party always falls for the fallacy of size. [Interruption.] My right hon. Friend the Member for Rugby (Mr. W J. Brown) says "the heresy of size." I think it is both a heresy and it is a fallacy. It is certainly a fallacy that efficiency goes with size——

Mr. Beswick

We said that at the last Election.

Mr. Ivor Thomas

The hon. Member often says things which are true and I am glad to have his agreement——

Mr. Beswick

And I was saying that it was in an official Labour Party pamphlet.

Mr. Ivor Thomas

Whatever may appear in pamphlets, the tendency of the party opposite is undeniable. It is always to create large units of administration. That, surely, is the argument behind bulk purchase and nationalisation and so on; and, in my experience, there was a hankering after one big Corporation. In my view, this tendency is unfortunate and damages efficiency. It leads to a growth of bureaucracy and makes impossible that personal responsibility and that decentralisation of decision which have been singled out by Lord Keynes as being the most valuable features of private enterprise.

Mr. Rankin rose——

Mr. Ivor Thomas

I have given way a great deal——

Mr. Rankin

Just one question——

Mr. Ivor Thomas

No, I do not think I ought to give way again. Apart from the Labour Party's hankering after one big corporation, B.O.A.C has never reconciled itself to the existence of B.S.A.A. This is just a case of "Empire building." Even when the Government policy was announced, it never reconciled itself to the existence of B.S.A.A. It did not take such strong exception to B.E.A.C., which it felt was "bone of its bone, flesh of its flesh." But I agree with my hon. Friend the Member for Mid-Bedford (Mr. Lennox-Boyd) that if there is a reduction to two Corporations, before very long there may be a reduction from two to one. I am sorry I cannot accept the assurance given this evening by the Parliamentary Secretary because I remember that on 26th February, 1948, he made a most enthusiastic defence of three Corporations and strongly denied rumours that there was to be a merging of the Corporations. In the light of past assurances, we cannot take tonight's assurance as being any more valid. I think the proposed merger is the result of this double pressure from the Labour Party on one side and B.O.A.C. on the other.

If there is to be a merger, is the right Corporation being suppressed? In the two years from 1946 to 1948, B.O.A.C. had a loss of £15,168,283, and B.S.A.A. had a loss of £348,796. In the same period B.O.A.C. cost the taxpayers £14,376,844 and B.S.A.A. cost the taxpayers only £260,000. In speeches which I need not repeat, I have used B.S.A.A. as a yardstick by which to measure the other Corporations and the figures are conclusive evidence of the greater efficiency of B.S.A.A. The accident record of B.S.A.A. is certainly bad. But I must make it quite clear that it has nothing to do with the crews, the ground staff, the management or the organisation of British South American Airways. The fault for the major disasters clearly lies in the aircraft. The causes may never be discovered and after the remarkable accident recently to the K.L.M. aircraft, a Constellation piloted by one of the ablest pilots in the world, one cannot be surprised that these disasters do occasionally happen. The fault cannot be that of the management or the staff of B.S.A.A. Indeed, these accidents have all been inquired into by the Chief Inspector of Accidents of the Ministry of Civil Aviation, and he has not suggested that any responsibility attaches to the management or the staff.

Let us turn to some of the qualities that exist in this Corporation now to be suppressed. In the first place I should put their keenness—and I put tremendous emphasis on this. It has been most heartening to have worked with B.S.A.A. I remember the remarkable way in which they started operating services from London Airport on 1st January, 1946, and how they started the South American service in March, 1946. Those were very remarkable achievements so soon after the war. We have heard this evening, by implication at all events, how they operated that most difficult route from the Azores to Bermuda, perhaps the most difficult leg for civil aviation in the whole world. I recall their readiness to undertake the most difficult charter flights, which at the request of the Foreign Secretary we had to ask them to undertake. I think also of the way in which they undertook experiments in flight refuelling after B.O.A.C. had been asked to do so and had felt unable to undertake them at that time. In all these matters there was a tremendous keenness in B.S.A.A., which it will be a great pity to lose in civil aviation.

Another most important factor was their readiness to use British aircraft. I am sorry to say this, but I think I ought to do so: I discovered a prejudice somewhere in B.O.A.C.—I never located exactly where because of the nature of the relations of the Minister with the Corporations—against British aircraft. May I put it this way: B.O.A.C. appear to use two pairs of spectacles, one for British aircraft, another for American aircraft. B.S.A.A. not only insisted on using British aircraft but had a very strong commercial sense and showed that a nationalised Corporation, using nothing but British aircraft, could pay its way. It was a remarkable achievement, and I suspect that this was the real offence of B.S.A.A. in the eyes of B.O.A.C.

Then there were the admirable staff relations of B.S.A.A.C.

Mr. Mikardo

Oh.

Mr. Ivor Thomas

The staff, many of whom are known to me, were as keen as mustard on their job, and, as many hon. Members have borne witness at different times, there has been a feeling of frustration among many of the staff of B.O.A.C. which did not exist in B.S.A.A., where the men were extremely keen on their work.

Must we suppress all these things? Are they to be lost? Let us not believe that this is a merger on a footing of equality. The Bill is quite emphatic about that; it is a Bill for the dissolution of B.S.A.A.C.; it is to be absorbed into B.O.A.C. That is a matter for extreme regret. If we are to have changes they should be, as the White Paper, Cmd. 6712, set out, in the direction of creating additional Corporations. No hon. Gentleman on the other side who has quoted that White Paper seems to have noticed para. 8, which says: The Corporations will not compete with each other on the same route or in the same area and the desirability of creating additional operating units will be considered as expansion of services or the needs of particular services appear to justify. That is the direction in which, if we are to have changes, we should progress.

It might be desirable to split up B.O.A.C. into smaller units. In general, it will be found that the larger unit is the less efficient and that the smaller unit is the more efficient. I should have liked to have seen B.S.A.A. made a little larger than it was made by giving it the West African services, but that view did not prevail. B.O.A.C. is certainly too large; it is a mammoth organisation and rather top-heavy. It is impossible for one or a few men properly to control such a vast organisation.

Those are the reasons which lead me to oppose the Bill. In view of the part which I took in the original proposal, no one will expect me to do otherwise. I oppose the Bill because I think it carries dogma into the field of civil aviation. I think there is bound to be an increase in the large deficits which British civil aviation has incurred. The Minister of Civil Aviation has set a target of £5½ million as the maximum deficit of the three Corporations in the present financial year. If this Bill means that in future the South American services are to incur losses on the same scale as the other services of B.O.A.C. that figure will be greatly exceeded, as will the limits set in the Civil Aviation Act. I do not think that this is a Bill which will promote the interests of civil aviation, and I feel bound to oppose it as strongly as I possibly can.

6.36 p.m.

Mr. Mikardo (Reading)

We have a rather charming convention in this House of trying to begin every speech by making a reference, if possible complimentary, to the hon. Member who has preceded one. I find it extremely difficult to follow that convention in respect of the rather nauseating turncoat performance to which we have just listened. The only observation which I will permit myself on the speech of the hon. Member for Keighley (Mr. Ivor Thomas) is that if the moral crisis, through which he seems to be passing, has got him into such a psychiatric state that it can only be satisfied by self-flagellation, I wish he would not undertake his hobby in public, where it turns other people's stomachs over. It is most surprising that we should have to listen to all the arguments against which the hon. Member argued with such force in 1946 now being trotted out as though they were his own property.

It is a little unfortunate that a good deal of this Debate has been taken up with rather odious comparisons between B.O.A.C. and B.S.A.A.C.

Mr. Lennox-Boyd

It was raised by the hon. Member.

Mr. Mikardo

I am coming to that. Each of these two Corporations has had some qualities which were denied to the other, and each has had some defects not shared by the other. The hon. Member for Mid-Bedford (Mr. Lennox-Boyd) showed one side of the case only. That was why I intervened and tried to show him that there is another side to the case. I am the last to wish to denigrate the fine qualities which B.S.A.A.C. developed, but that is not what we are discussing. But even if B.S.A.A.C. was perfect, as it was not, and if B.O.A.C. was totally reprehensible, and it is not, it might be necessary, in order to improve the efficiency of the industry as a whole, to merge the two.

The question to which we should direct our attention is not whether the one has some virtue which the other has not, but whether the interests of the nation are best served by the merger. People who now loudly sing the praises of B.S.A.A.C. have themselves put forward different views in the past. We have heard the hon. Member for Keighley talking about the great drive and leadership of Air Vice-Marshal Bennett. I well recall the time when he complained to Members of the "caucus" about which he was speaking that every time he as Parliamentary Secretary wished to consult the chairman of B.S.A.A.C., he found that he had got into an aeroplane and had flown to the other side of the world.

Mr. Ivor Thomas

I never mentioned Air Vice-Marshal Bennett this evening, and I never made any such complaint.

Mr. Mikardo

Oh, yes; the hon. Member did. The hon. Member talked about the excellent staff relations in B.S.A.A.C. It is extremely interesting to note that the only Corporation which employees have found it necessary to take to the Industrial Court has been B.S.A.A.C., and that was in the days of the Chairmanship of Air Vice-Marshal Bennett. The only occasion on which the industry has had an engineering dispute which has not been settled without going to the Industrial Court, with all its panoply, has been in the case of B.S.A.A.C., under the chairmanship of Air Vice-Marshal Bennett, which does not in the least suggest that staff relationships are better there than in the other two Corporations. [An HON. MEMBER: "He was not chairman."] I beg the pardon of the House—Chief Executive.

We are, as I tried to say earlier on, concerned here only with whether this change is in the interests of the industry as a whole, and on that point I would say that the only thing wrong with the proposal is that it has come far too late. It is a belated recognition by the Government of the force of the arguments put forward from these benches, which were talked down by the Lord President of the Council and the hon. Member for Keighley—what a queer combination that looks now—and which in the light of events have proved to be quite right.

What was it that we said in 1946? We said that there was no great virtue in centralisation or de-centralisation. Some people talk as if a religion can be made out of one or the other; that one must be 100 per cent. right, and the other 100 per cent. wrong. Practical people know that the question of centralisation or de-centralisation in carrying out a given function in a given organisation must be considered entirely on the merits of that particular case. Sometimes it is best and most desirable to centralise some and de-centralise others. The argument in 1946 was that no matter how many Corporations there were, they should work together jointly to carry out together certain activities which could be better carried out in unison than separately.

The Government White Paper, Command 6712, which has been referred to, forecast that there would be changes between the three Corporations in carrying out certain functions. It listed two such functions as examples; the maintenance of aircraft and the training of air crews. The first of these two functions has never been carried out jointly by the Corporations. The second was for a short time, but because of the opposition of certain people in B.O.A.C., who wanted to be cocks of their own little dunghill, that was abandoned. If we had had the committee of chairmen of the three Corporations which was designed always to get joint working in all matters which, on the merits of the particular case, could best be carried out jointly rather than separately; if that had really worked; if we had had joint training, recruitment, and selection of training organisations between all three Corporations; if we had had maintenance centralised so far as possible, and so on, then this question which we are arguing now, as to whether there should be three, or two, or even one Corporation, would be quite an academic question.

The point that matters is that when we put forward these suggestions in 1946, we were told from both Front Benches that we were wrong. We heard a lot of talk, which, with great respect, can be described as nothing more than rubbish, about the competition between the three bodies. How can there be competition between a Corporation flying large aircraft to Singapore and a Corporation flying small aircraft to Glasgow? There is no competition between them in any sense of the word. The hon. Member for Mid-Bedford was talking about the possibility of another amending Bill which will remove all competition from the industry altogether. There is no competition in the industry, except of course with foreign operators.

Mr. Lennox-Boyd

I was only quoting the Lord President who said this would give an element of emulation and free competition. I quoted that to intimate that we did not think there was anything like enough competition, but that what there is the Government are doing away with.

Mr. Mikardo

That point of view was argued passionately by the Lord President in 1946; and by the hon. Member for Mid-Bedford this afternoon—otherwise I cannot see the basis of his opposition to the Bill. I say that the Lord President was wrong in 1946, and I say that the hon. Member for Mid-Bedford is wrong today when talking about competition between two organisations which sell quite different things. We would not talk about competition between two railways one running between New York and San Francisco and the other between Paris and Calais. We would not talk about competition between a firm selling tractors and another firm selling stockings. There is as much difference between services spread over 10,000 miles and services spread over 200 miles as there is between tractors and silk stockings. It is equal nonsense to talk about emulation as a basis of comparison. When we come to cost comparison, when it is a question of a change in the length of "hop," a change in the type of aircraft and the average speed, the possibility of any sensible cost comparison between one route and another is entirely done away with.

Mr. Geoffrey Cooper (Middlesbrough, West)

Would not my hon. Friend agree that by having a number of Corporations there is scope for trying out various methods of staff control, so that happier relations may be achieved between the organisations comparing one with another; and also that if one employee's face did not happen to fit in one Corporation, he would have the opportunity of showing his competence in another?

Mr. Mikardo

Certainly. My hon. Friend has mistaken me. I am not arguing in favour of one Corporation. I am reiterating the argument of 1946 for saying that one should not consider these things as a piece of centralisation dogma. If there is to be a division into a number of Corporations, the division into three was perhaps the most illogical division we could find.

Where did that division come from? It was taken over wholesale from the White Paper of Lord Swinton. He divided the proposed air routes not at all according to technical considerations, such as the length of "hop," the average speed or the type of aircraft. He divided the proposed air routes—as he said quite frankly, and as others have said this afternoon—entirely to give one bit to the shipowners and another bit to the railways. That is not a division of function; it is a financial division pure and simple, and we took it over holus-bolus. If the Lord President and the hon. Member for Keighley had come to the House honestly and said, "We shall save some time by taking over Lord Swinton's division," there might have been some sense in it. Instead, rather hypocritically they pretended that his division, made for financial reasons, held good for technical and functional reasons as well.

Now we are talking this afternoon of launching on its way a new Bill partly to correct the mistake made in 1946, and indeed to vindicate the views then put forward from these benches. I remember the hon. Member for Nuneaton (Mr. Bowles)—before he removed himself from the arena of such controversy to the neutral office which he now holds with such great distinction—saying that of all the illogical things in this proposal, nothing was so illogical as to distinguish between the North and South Atlantic. In fact, all the considerations suggest that these two are better together. We find now that, for one reason or another, there are no aircraft to fly the South Atlantic and we are now doing what the hon. Member for Nuneaton said in 1946 we should have to do, and what the Lord President and others denied at that time.

I also wish to refer to the suggestion made from the benches opposite—and particularly by the hon. Member for Mid-Bedford—that the employees of the airways Corporations, or a very large part of them, are opposed to this Bill. I share with the hon. Member the view that a Government cannot, of course, decide its policy entirely on the basis of what is thought by the workers in a particular industry; but I share also his view that the opinions of these workers are an important factor which must be taken into consideration. Where I differ from him is in his suggestion that the method that he has used to measure the views of the workers in the industry is the right method. I speak here as the only Member of this House who happens to be a member of the National Joint Council for Civil Air Transport on which I represent one of the 14 unions who are parties to the National Joint Council and who between them have in membership the overwhelming majority of all the people employed by all the three Corporations. If the hon. Member for Mid-Bedford had really wanted to find out what was the view of the great majority of the people employed in the Corporations, he might have sought to find out what was the view of the National Joint Council.

Mr. Lennox-Boyd

All we are concerned about now is the view of the men and women working for B.S.A.A. Does the hon. Gentleman say that the 14 trade unions among whom he sits represent the majority of the workers in B.S.A.A.? If he made an emphatic statement to that effect, it would have some value.

Mr. Mikardo

I was just coming to that. I do not want to be unfair and I know that the hon. Gentleman was talking mostly about B.S.A.A.

Mr. Lennox-Boyd

Only.

Mr. Mikardo

Yes, but this does not only concern people in B.S.A.A. This merger affects people in B.O.A.C. as well.

The hon. Member for the Isle of Wight (Sir P. Macdonald) said that people employed by B.S.A.A. were afraid that the resultant redundancy would reflect only on B.S.A.A. personnel. In fact, the Corporations have given the most categorical assurance that any redundancy caused by this merger will be shared out fairly between the two Corporations. Therefore, both Corporations and the workers are equally concerned in the matter. I will answer the hon. Gentleman's question a little more directly. I do not know, and nor does he or anybody else, what proportion of people in the employ of British South American Air-ways belong to each organisation. Bona fide trade unions, for very good reasons, do not disclose their membership to anybody. Scab organisations, organisations which exist not for the proper trade union purpose of the protection of their members but for the benefit of the ambitions of one or two people, for political purposes, or for sabotaging the welfare of the industry—such organisations are only too ready not merely to disclose the number of their members but to claim as members a lot of people who have never been near them, and so they inflate their figures.

Therefore, I cannot answer the hon. Gentleman's question. I do not know whether the majority are in the 14 trade unions. I say that to the best of my knowledge and belief the answer to this question is "Yes"—that the National Joint Council represents the majority of the people in the employment of B.S.A.A. I am pretty sure that that is so. I cannot be sure, and nor can he, of the actual number because the number is not published. The National Joint Council, and the trade union side of it, support this merger. The fact that there is one dissident organisation which stands outside for purely political purposes ought not unduly to influence this House. The hon. Member for Mid-Bedford began his remarks in this part of his speech by confessing that he did not know very much about trade union organisation. He then went on to prove the truth of what he had said by making a number of schoolboy howlers about trade union organisation. Before he got to talking about the Aeronautical Engineers Association, to whom he was referring principally and from whom he appears to have got his information, he at least twice referred to them as the Amalgamated Engineering Association—an organisation which does not exist at all.

Mr. Lennox-Boyd

It was a slip of the tongue.

Mr. Mikardo

The hon. Gentleman will find that on the record tomorrow, unless he finds some means of getting it corrected. In the second place, he referred to this organisation as a trade union which was not affiliated to the T.U.C. because it did not want to be associated with a particular party. The hon. Gentleman ought to know by now, if he wishes to talk about trade unions, that an organisation is not automatically associated with a political party if it becomes affiliated to the T.U.C. and that in fact there are many unions affiliated to the T.U.C. which do not have any political arrangement with any political party. In the third place, he ought to know that the Aeronautical Engineers' Association have tried only too hard—it is not the case that they have been "upstage" and that they did not want to associate with the unions affiliated to the T.U.C.—to get into the National Joint Council machinery. But I am happy to say that on the National Joint Council we are rather particular of the company we keep and do not like associating with scabs and people of that sort. That, I think, disposes of the question of the attitude of the workers in this industry.

I wish to make one final point, which is that it is true that there is a good deal of unrest, especially at Langley, about this proposed merger. That unrest is greater now than it was even a few weeks ago. It is greater because the promises which were made to the workers' representatives that they would be fully consulted about all the matters arising out of the merger, at every stage of the merger, have not been kept and are not being kept.

The hon. Member for Mid-Bedford and others may be interested to know that within 48 hours from now I am going with the chairman of the National Joint Council to Langley at the request of the workers there. They want to know from us how far the promise to consult through a working party on all the details arising out of the merger has been carried out. I am very much afraid that if we have to tell the employees at Langley, as we should have to tell them unless there were a change within the next few hours, that these promises have been carried out in the letter and not in the spirit—not even in the letter at all times—there may be a great deal more unrest among the employees of B.S.A.A., and the Corporation may have a great deal more trouble in implementing this Bill in practice than will be experienced in getting it through the House today.

I utter that word of warning in case it should turn out that the hon. Member for Mid-Bedford is right and I am wrong. If matters turn out in that way it can only be because promises to consult properly with workers are not being carried out. If that turns out to be the ground of the workers' objections, I for one would fully support them.

I support this Bill because it seems to me to be right. It seems to effect an improvement in the industry and to put into operation a principle which is as right now in 1949 as it was in 1946 when it was first put forward from these benches. I support the Bill, but I do so with a consciousness that the carrying of it into detailed effect in the operation of the merger between the two Corporations will not be so easy in practice as it is to talk about on the Floor of this House; that many problems remain, and that it is to be hoped that some of these problems will be faced in future with greater zest, greater efficiency and a better spirit than has been the case over the last few weeks.

Air-Commodore Harvey

Before the hon. Gentleman sits down, will he say why he thinks that the promises made by the management to the B.S.A.A. employees have not been kept?

Mr. Mikardo

I am sorry if I have misled the House. They were not promises to B.S.A.A. employees. They were promises to the representatives of the workers on the National Joint Council as a whole, to operate the details of this change through a working party. If I had to guess at the reason why the promises have not been kept, I should say that it is that there still exist in certain of the Corporations some executives who do not like consulting their workers and that there has been a certain amount of resistance.

7.0 p.m.

Mr. Niall Macpherson (Dumfries)

I have been very interested in the speeches of the hon. Members for Enfield (Mr. Ernest Davies) and Reading (Mr. Mikardo), because they have shown quite clearly that those hon. Members have been in favour in principle of this merger all along. In fact, it appears from what they said that they would like to go a good deal further and see more co-ordination or even amalgamation than is contemplated in this Bill. That is in contrast to the attitude of the hon. Member for Uxbridge (Mr. Beswick), who I am sorry to see is not in his place, and who made a very interesting speech in which I said, as indeed the hon. Member for Keighley (Mr. Ivor Thomas) said, that B.S.A.A. was too small. In his earlier remarks, the hon. Member said he would have liked to keep it on, but he said he had been convinced by the statement of the Parliamentary Secretary that the aircraft situation made the merger necessary. Indeed, we rather gathered from the Parliamentary Secretary that, while he himself indicated that he had long been in favour of a merger between B.S.A.A. and B.O.A.C., what actually tilted the balance in favour of the merger with the other experts was simply this shortage of aircraft.

It seems to me that the essential feature of this matter is that that shortage of aircraft is a temporary one, though one cannot judge exactly the length of time it will continue. It also seems to me to be very fallacious and wrong to base the permanent pattern of civil aviation on what is in fact a temporary emergency. In passing, I might say one Would not know what were the objections on the part of the Parliamentary Secretary to the existence of B.S.A.A., but, from the remarks made by the hon. Member for Reading, it would appear that they were not altogether separated from the fact that B.S.A.A. has in a marked degree shown a spirit of independence and initiative which was exactly what we understood the three Corporations were set up to promote. That is now being done away with. It is all very well for the hon. Member for Enfield to say that we criticised the three Corporations because they did not provide enough competition. This Bill does away with that competition very much more, and that is why we on this side of the House are opposed to it.

I would like to refer to the main reasons given today and in the original statement made by the Parliamentary Secretary on 15th March for the merger. The House will remember that, to sum them up, the hon. Gentleman said that both Corporations operate long-range aircraft and that their routes overlap and converge. He added today that both operated in the Western Hemisphere, and he also spoke about achieving maximum economy and efficiency, on which stress has been laid by several speakers, and which indeed is the aim of the Government, as it is the aim of any Government. May I deal with these points one by one? First of all, so far as the operation of long-range aircraft is concerned, will the Parliamentary Secretary tell us whether ultimately it is likely that the type of aircraft operated by B.S.A.A. and B.O.A.C. are likely to be the same, or, at least, similar? I suspect that permanent aircraft will be used in different parts.

Mr. Lindgren

The real problem is what is going to happen between now and when the D.H. 106 comes along.

Mr. Macpherson

I am of the opinion that the decision to amalgamate is not justified merely because of present difficulties, which could probably be got over in other ways and especially by the loan of aircraft from the other Corporation.

Secondly, on the question of the routes overlapping and converging, from what the Parliamentary Secretary said it seems to me that here again the overlapping is temporary. It may not be, but it seems unreasonable that we should continue to serve the Caribbean from the Northern route indefinitely. We should look forward to the time when the service is provided direct via the Azores to Bermuda. The sole justification for the merger on that score was the idea of having a kind of circus, in which planes would start and go round the route one way while another service goes round the opposite way. Again, that does not seem to be an adequate reason for not considering the retention of the seperate identity of B.S.A.A. Then there is the point about both Corporations operating in the Western Hemisphere. If I understand the projected organisation correctly, there is to be a separate South American division which will be quite separate from the Western division.

Mr. Lindgren

For a while.

Mr. Macpherson

For a while? I see. I take it that the Parliamentary Secretary is only envisaging one step at a time, but I hope he will tell us tonight what is the ultimate aim.

Then there is the additional argument about achieving the maximum economy and efficiency. So far as economy is concerned, it was very noticeable that the Parliamentary Secretary thought that the economies were principally dependent on amalgamation. He said very few economies in staffing were to be expected. He said that the economies were dependent rather on improved technique and particularly on the use of new aircraft. That is common ground, and so it appears that any economies which are to be realised are not going to come about from the amalgamation. So far as efficiency is concerned, this point has been dealt with by several hon. Members opposite, but I hope we shall have from the Parliamentary Secretary a little more information on what the actual organisation is going to be. The fear which I have in my mind is this. It seems to me from what the Parliamentary Secretary said that, on the one hand, we shall have the sphere of operations divided up into divisions, and that we shall create Airlines which are overlapping with the divisions; that is to say, to a certain extent, one Airline will be supplying aircraft to two divisions, even although that particular Airline may be subject to the authority of one of those two divisions.

I should like to refer to the evidence of Mr. J. W. Booth, at present the Chairman of British South American Airways, who gave evidence to the Select Committee on Estimates in 1947. He was asked by the Chairman of the Sub-Committee: What about maintenance? You do your own maintenance? The answer to that was: Yes, that is an absolute prime requisite. We are responsible for the condition of those aircraft. If somebody else were doing the work, we should never know whether it was right or wrong. That seems to me to be most interesting. It is quite a different thing to envisage a Corporation of the size of this one and one of the size that B.O.A.C. is to be in the future. In the second case, we shall have an airline wholly responsible for the provision of the planes, the maintenance and all the rest, though the responsibility of operation is going to rest on someone else. It seems to me that, given the size of B.O.A.C., that cuts right across the principle enunciated by Mr. Booth, and that we are going to run into trouble on that score.

I am not certain, of course, to what extent there has always been a feeling of antagonism between the Corporations, but one thing that is quite certain is that it is always disagreeable to be adversely compared with another Corporation. But that, again, was the very purpose for which we created the three Corporations as against the two. My hon. Friends have frequently made comparisons to the disadvantage of B.O.A.C.

Then there is the question of the redundancies. I would like to refer to what the Parliamentary Secretary said on that score on 15th March. He said: Any staff redundancies resulting from the merger will be shared fairly between the two Corporations and in accordance with National Joint Council procedure."—[OFFICIAL REPORT, 15th March. 1949; Vol. 462, c. 1924.] As an expression of intention, we naturally accept that, but we are entitled to ask whether, in fact, it will work out in that way. The Parliamentary Secretary told us this afternoon that B.S.A.A. was being built up to handle the fleet of 19 Tudor aircraft expected this summer. That being so, their role is going to be much changed, particularly on the maintenance side, if they are now purely going to maintain the obsolescent aircraft—I do not know whether this is so; at the moment, I am merely asking the question, and I hope that the Parliamentary Secretary will give the necessary assurances for which my hon. Friends have asked—such as Yorks, Tudors for freight purposes, and Canadairs, because, as those aircraft become obsolescent, so, too, will the maintenance staff, and there may be a time when it will be much easier to get rid of them rather than of others who have already been fully trained in the maintenance of the new aircraft now being purchased. That is one of the reasons why it is so essential that the Parliamentary Secretary should make up his mind about the training of the B.S.A.A. maintenance staff in Canadairs or other aircraft which are to be maintained in this country. I hope he will tell us something about that, because there is not the slightest doubt that there is very great concern among those in B.S.A.A. about it, and possibly this may be one of the matters to which the hon. Member for Reading was referring when he said that there had not been sufficient consultation.

I revert once again to what I said regarding the question of reaching a permanent decision on a temporary basis, which is, I think, the main question that we must ask the Parliamentary Secretary to answer tonight. I am also not at all happy about the methods that have been used to tone down criticism. The Parliamentary Secretary has said that, of course, there is a job to be done, but we cannot get away from the fact that people in a nationalised industry have two functions; first, they are there as workers, and, secondly, as citizens. As citizens, they are allowed to express their view as to how the public money should be spent and how the organisation should be run, and to exert such pressure as they think necessary, political and otherwise, to achieve their objects. It seems to me wholly wrong to curtail that right of criticism. I have been informed on good authority that pressure was brought to bear on certain members of the B.S.A.A. staff not to criticise in public. I think that is deplorable, and I hope it will not occur again. Unfortunately, the chance of adequate criticism in public has more or less passed now that the matter has come on to the Parliamentary plane.

In conclusion, I consider that it is up to the Parliamentary Secretary to demonstrate quite clearly that the change is in the interests not only of the immediate operation of the airlines, not only of the long-term efficiency and the long-term economy, but that it will result in itself, and quite apart from the considerations of which we know—additional new planes—in greater efficiency. That case has not yet been made out, and, unless it is, I shall most certainly go into the Division Lobby against this Bill.

7.16 p.m.

Major Vernon (Dulwich)

I have listened to a great part of this Debate and with particular care to the objections to this proposal. On the whole, I do not find them very persuasive or very convincing. I have noticed three of them. The objection emphasised by the hon. Member for Dumfries (Mr. N. Macpherson) was the temporary nature of the emergency which has led to this change. The hon. Member for Keighley (Mr. Ivor Thomas) spoke about the "cult of bigness," and one or two other hon. Members have spoken on the general principle of competition.

With regard to the temporary emergency, it may be that circumstances occurring comparatively recently have influenced the Minister and the Parliamentary Secretary in making this change now, but the advantages that have been presented seem to me to be pretty solid. Even though circumstances may change in the future, the arrangements at present in existence are not fixed and permanent, and it seems to me to be far easier to adapt a centralised organisation in order to give greater freedom to the divisions, as that may become necessary later on, than it is to weld three distinct organisations and to co-ordinate them towards the centre. I do not think that the hon. Member for Dumfries need be unduly worried that this organisation will be so rigid as to promote inefficiency in the future.

Mr. N. Macpherson

I was not arguing that it was going to promote inefficiency, but that the B.S.A.A. was demonstrably a much more efficient organisation than that with which it is being merged.

Major Vernon

I have not time to go into details of comparison, but I am not convinced that the general efficiency, taking everything into account—the accident rate, and everything else—of B.S.A.A. is so much better than that of B.O.A.C.

Coming to the "cult of bigness," I think that is just a gibe. I happen to have been connected with aviation from soon after the first world war, and I agree that in the early days there was a tendency for people to build bigger aeroplanes than they should have done. But, nowadays, there is so much experience available that reasonable people are not led away by the emotional attractions of bigness which the hon. Member for Keighley seems to attribute to our side, and which, presumably, he imagines are very far removed from the lofty intelligence of hon. Members opposite.

Thé argument about competition as used by hon. Members opposite is one of those arguments upon generalities and it does not seem to concern aircraft organisation in the very least. There is only one way in which competition between aircraft can be obtained, and that is by having two sets of organisations operating over exactly the same route. We should then get direct comparisons, but everything would be duplicated and the idea would be ridiculously extravagant. As my hon. Friend the Member for Reading (Mr. Mikardo) pointed out, it is impossible to compare the efficiency of aircraft organisations on different routes. I happen to have done some work on statistical investigations and comparisons, and the people who have studied it most find it extremely difficult to get any relevant figures from the statistics which exist. In fact, the hon. Member for Mid-Bedford (Mr. Lennox-Boyd) bore out this fact when he gave constants for different airlines, some of them three times as great as the other. The three-to-one ratios mean nothing. Obviously the conditions were very different. The notion of competition is something which does not really apply and it is of no value in this controversy with which we are dealing.

The Parliamentary Secretary said that our job this afternoon is to consider how best to organise this industry, and I want to make a contribution in that respect. Looking back over the history of civil aviation in Britain one sees very many changes in organisation. It has been almost like a trade cycle—reorganisation, great hopes, doubts, fears, despair, followed by a commission or some investigation to change the organisation, and then it starts again; the same cycle is repeated. In the early days we had competitive enterprise, subsidised enterprise, monopoly, the chosen instrument, the three Corporations, one Corporation—a sequence almost like the nineteenth century trade cycle. What one has to study nowadays is whether anything can be done to break this sequence.

It seems to me that there is one point where a change could be made, and it is in the appointments to the highest positions. I am one of those who think that the pattern of organisation is important, but it is not so important as the people who operate it. Imperfections in organisation may be overcome by the special ability, character and suitability of the people operating it. What we need most of all is to get the most suitable people in the highest positions. What can we suggest? Where can we look for examples of a better method than that which has been used? We have them in front of us in the middle ranks of the Civil Service and in the appointments made by many local authorities. The first necessity is to spread the net as widely as possible. I think that all the important posts should be advertised so that everybody in the country who believes that he is suitable may have a chance of applying for a post. Then there must be found some method of selecting from this large number of applicants the few who have the utmost suitability.

Colonel Dower (Penrith and Cockermouth)

Does the hon. and gallant Gentleman include in the net those pioneers in aviation who have a vast amount of experience but who have been dead against the State taking over that industry?

Major Vernon

I happen to have been brought up with the pioneers in aviation. I have known them personally. I know their strength and their weaknesses. Some of them we used to call the robber barons because their predilection for profits overcame their desire to serve the public, but that is rather by the way. We passed through the pioneering days when many individuals broke out into new territory and achieved magnificent results. Now the subject is much more generally understood and there is a great deal more experience, but there is now a great deal more to be mastered before one can achieve the power to manage these great responsibilities fully.

On the subject of selection, there are the London County Council selections for heads of schools. There is also a selection committee in the Civil Service, and on these committees there is a large variety of people—specialists, non-specialists, officials, independent people who have eminence in some particular walk of life, and people with knowledge of the particular kind of work to be done by the successful applicant. This impartial body selects from the large number of applicants the small number who are most suitable, and in the working of this system it is most remarkable that generally, after the committee have heard the answers to the questions which they put, they get such close agreement as to the people who are most suitable.

We do not know very much about the present methods of selection for the Corporations. Presumably advice is given to the Minister by a comparatively small number of people. They may be very virtuous, but it is most unlikely that they can have any great technical knowledge such as is needed for this complicated and technical enterprise. Judging by results and by the great number of changes that have taken place, and also judging by the failures in the past, I do not think anyone can say that the selection has been a great success. I want to ask this question: Has the Minister still an open mind on methods of selection for the highest posts? I believe this is the one point where the application of the general intelligence of the community can be brought to bear so as to bring about beneficial changes in the most rapid manner.

7.28 p.m.

Lieut.-Colonel Sir Walter Smiles (Down)

When I first read this Bill, thought that there was nothing very bad in it, and I almost considered voting with hon. Members opposite. After all, this should not be regarded as a political Bill. We should all speak as passengers on the airlines and as taxpayers. But after listening to the speeches this afternoon, I am bound to come down on the side with which I always vote.

Let me deal, first, with this question of amalgamation. It does not necessarily follow that an amalgamation will be successful. I have had experience of companies amalgamating and being very successful. I have also had experience of larger companies going bankrupt and being split into smaller sections, the smaller sections doing very well. In theory, I do not think that size counts for everything. Of course, if we could reach a happy state where the aircraft would be landed on a field every minute or every five minutes, as has been done in the Berlin airlift, it would be very easy so to arrange our ground staff that the operation would be economical. At present, however, I think that if we took the diary of many of the ground staff on our aerodromes we should find that they spend hours of useful time hanging about waiting for a plane to land.

It does not even follow that road transport is always 100 per cent. economical. We may not know, when landing from a plane of a certain Corporation, that we shall be able to get on a bus going from the air port to the city terminus, even if it is half empty. The other day I saw the Glasgow bus leaving for Kensington half-empty and I wanted to get on it and save 15 minutes, but I was told that I could not do so because it was the Glasgow bus. Of course, Scottish people are clannish and have a reputation for keeping themselves to themselves, but it would make for economy if all the buses were always full, though I know this is not possible. I agree with the hon. Member for Keighley (Mr. Ivor Thomas) that the losses are probably not made in the air but on the ground.

The hon. Member for Dumfries (Mr. N. Macpherson) mentioned the overlapping of routes. I believe a certain amount of overlapping is a very good thing. After all, the trains and buses overlap on our routes and it makes for the convenience of passengers. I think it would be an excellent thing if some of our routes did overlap, perhaps in Bermuda and other parts of the world.

I was very glad indeed to hear the Parliamentary Secretary's remarks on this question of equal seniority, because here was a problem which I was afraid would arise. This amalgamation might be unfair either to members of British South American Airways or to members of B.O.A.C.; it might make for a lot of heart-burning. Now I understand, however, that this change will be made as fairly as possible; just as in the Civil Service, I understand, in the case of redundancy the last in is the first out. Given equal efficiency, I am very glad to learn that this principle will be followed.

Perhaps I might call the attention of the Parliamentary Secretary to the position of some of his staff, the girls or young women who work the radar system. There is a certain amount of unrest, or perhaps a feeling of frustration, among these girls because they are not to become covenanted civil servants eligible for pension. Some of them are actually working for examinations in the Civil Service so that they may have a pension when they retire, because, after all, following the last World War, not even all attractive girls can necessarily expect to get married.

The hon. Member for the Isle of Wight (Sir P. Macdonald) mentioned flying boats. There are other places as well as the Isle of Wight where flying boats are made; a good many are made by Short and Harland's in Belfast. I do not very often come in contact with people making them, but I happened to do so the other day when Princess Elizabeth visited Belfast, and I understand that they have a good order book and expect to do very well, especially in South America. I do not think any of us can forsee today what the future of flying boats will be in another five years. It may be that for certain services the flying boat will be found to be very much superior to the aeroplane.

The worst thing about these Corporations is this, as even this discussion in Parliament has shown. After a speech in public it is hard to change your mind. When directors hold a meeting they hold it in their directors' board room and they make their decisions in private and in the light of the best knowledge which is then available to them, but they are not afraid to go back on those decisions in another two or three years' time if other information becomes available. Here we see the worst point about all this nationalisation. Speeches are quoted in the House and people go back for five or even more years to quote from speeches made in the past. Yet in a system of transport which is going ahead as fast as is civil aviation, all those speeches may be out-of-date—just as out-of-date as is the old Caudron bi-plane with the 27 h.p. Anzani engine today when it is compared with a jet engine.

After all, all nationalised services do not do so badly. The hon. and gallant Member for Macclesfield (Air-Commodore Harvey) quoted the Swiss airlines as having made a small profit. I believe K.L.M. do better than we do and I understand that the United States of America do much better, although an American gentleman with whom I flew last Monday told me that every aerodrome in the United States was completely out of date. He said they are having to double them because civil aviation is going ahead so fast.

I think it would help the efficiency of our airways if we made better use of the private charter companies. That is the sort of thing that the hon. and gallant Member for Macclesfield could not say and I have not discussed it with him, but I believe that in many of these small feeder services better use could be made of the charter companies. They might be able to make a profit where a big Corporation would make a loss. I believe that in the future, perhaps in three or four years' time, these Corporations may be broken up again into four—not two; for when we accept nationalisation it is not so much a question of whether it should be three or two. I believe it will be found that this new Corporation is too large altogether.

Everybody in the country wants these airlines to succeed. We want more air-minded people. Every satisfied passenger is our best advertisement. Every smash sets us back. The smashes which have occurred to the Tudor airliners have been a tragedy, for had we not had these smashes we should not be dealing with this Bill today. I hope that in the future the Corporation will do well because every one of us is interested in it. Before I conclude, I must say, as one who travels a good deal by air, that I see an improvement coming along steadily.

7.38 p.m.

Mr. Geoffrey Cooper (Middlesbrough, West)

I am glad that the Parliamentary Secretary is back in his place because I should like to comment favourably on his remark that this is not a political issue. I think we are trying to decide this matter, for or against a merger, on the merits of the case, and as such, even if I shall be a little critical of the Bill. I do not want to support the case for the Opposition, because their opposition to the Bill is on account of the fact that they speak in favour of private enterprise being given the job, whereas I speak against the Bill because I think it will not achieve the advantages suggested by the Parliamentary Secretary in making these nationalised undertakings more successful. That is a very important matter for those of us on this side of the House who wish to ensure, by every means possible, that these nationalised undertakings are a success.

It seems to me a pity that these arguments and technical proposals, and other suggestions from hon. Members on both sides of the House, cannot in some way be given consideration before the Government's decision is announced on a matter of this sort, because it is a highly technical problem and it is always possible that the Government have not taken into account all the salient features before they announce their decisions by introducing such Bills.

I want to make one point in particular which, I think, has not been made in the Debate so far. First, however, I would say that my first reactions to this Measure when it was brought before the House were dead against it. I thought that we had had far too many changes taking place in the policy for civil aviation. The Government have shown such a variety of trends as to cause a sense of confusion amongst those trying to operate civil airlines. My fears were largely based on the fact that I think we are going forward towards a policy of over-centralisation. I agree with the hon. Member for Reading (Mr. Mikardo) that we cannot have any particular religion about centralisation or de-centralisation, but I think we can have very clear ideas when we see the development of the organisation, as it affects airlines, when it becomes over-centralised, because we have seen in the past the effects of over-centralisation. They are far too clear to ignore.

I tried, after my first reaction against the Bill, to check back as dispassionately as I could amongst the people who could advise me, including employees of the various Corporations, and those people who are considered to be experts in civil aviation who are outside the Corporations. I found that, on the whole, my objections to the Bill were substantiated. Having listened to the speech of the Parliamentary Secretary I must say that my fears are rather confirmed than removed, not so much by what he said, but by what he failed to say. I would comment here on the fact that he did not make any reference at all to any sensible alternative to this merger.

Mr. Lindgren

There is not any.

Mr. Cooper

I am glad my hon. Friend admits that, because it gives point to the argument I wish to use. So far as I can discover, no consideration was given, on the purely technical grounds of operating airlines across the Atlantic, to the possibility of British South American Airways being given a bigger job to do—being given both the North and South Atlantic operations to undertake. I think that if that had been done the Bill would not have been necessary, and that the Government would have come forward with a different decision. Rather than submerge British South American Airways in B.O.A.C., they would have done the other thing, and given the Atlantic operations of B.O.A.C. to one Corporation running British-American air services.

I believe, from such indications as we have had from the pronouncements of Ministers from time to time, that this decision before the House is not a unanimous Cabinet decision—if we can judge by the pronouncements of such Ministers as the Lord President of the Council. I would analyse for a moment the arguments for this merger. The first, of course, is that we have not suitable aircraft which British South American Airways can use to enable them to do their job properly. That is a purely temporary state of affairs. In time, suitable aircraft would have come forward undoubtedly for British South American Airways. I think it is a great pity to make a permanent decision to submerge British South American Airways, and to base that decision on what is a purely temporary consideration.

Another argument in favour has been that the merger will save overheads. I am not at all certain that this question of saving overheads is being analysed as fully as it ought to be. In B.O.A.C. we have a number of employees on what is called "paid leave," and who have been so for an unconscionable time. That does not indicate that the question of saving overheads is being considered by that particular organisation which is going to absorb B.S.A.A. There is a provision in the Bill for a second vice-chairman. That seems to me to be going against the suggestion that the merger will save overheads. It seems to me a great pity, from the employees' point of view—which, I think, has not been very adequately or sufficiently considered by the Government—that no provision is made in the Bill for their possible redundancy also. So far as the top-level people are concerned there is provision, but there is no provision in the Bill for protecting the rank and file workers from the fear of redundancy.

One of the suggestions in favour of the merger is that we shall not be losing the lessons that can be learned from British South American Airways' methods of operations. If that is a valid argument, that it is right and proper to take advantage of those lessons, surely it is a valid argument for maintaining B.S.A.A., or a similar Corporation—a third Corporation—in being, so that the other Corporations can continue to learn lessons from the alternative methods of organisation and operation. I often wonder if, in fact, the higher standards of proficiency which, by and large, have been achieved by B.S.A.A. are acting as a sort of thorn in the side of B.O.A.C., and it may well be that that is why, consciously or subconsciously, the arguments have been used in favour of the merger. It was suggested that overlapping will be reduced. I do not believe that to be a strong argument. The only place where it might occur is in Bermuda, and undue overlapping is a small point to remedy, and does not require the bringing in of a Bill.

Let us consider the arguments against amalgamation. First, I suggest that the Government's policy in the past has been to retain the principle of several units, so that there may be some comparisons between their methods and types of operations. Reference to this matter has been made by various speakers, and so for the record I should like to quote quite briefly from the remarks made by the Lord President on 6th May, 1946. He mentioned this point, and said: We wish to introduce and develop in the industry the spirit of emulation, of gathering a varied experience, and a certain degree of competition between varying undertakings. … I know that that has been spoken against by the hon. Member for Reading. The approach of the Lord President and that of the hon. Member for Keighley are vastly different. I would not agree to linking up these two approaches. I did not believe that the arguments were strong which he used against the Lord President's proposals. The Lord President went on to say: … there being three Corporations, they will have varying ways of doing a number of things. They will acquire a varied experience, and, in our judgment, that is distinctly of advantage, particularly in a new industry of this sort. The last point that my right hon. Friend made, which is relevant to my case, was: … it is my firm belief that Socialistic enterprise, particularly in a newish and developing industry like this, is a good thing, and that the element of emulation and legitimate competition should be provided for in the sphere of public ownership. My conclusion, therefore, is that the Government's proposals are logical. …"—[OFFICIAL REPORT, 6th May, 1946; Vol. 422, c. 606.] If the Government's proposals were logical at that time, then the Government are putting forward a somewhat illogical case at the present time, and it is because of my firm conviction on that point that I speak as I do.

A further argument against amalgamation is that which I made in interrupting the hon. Member for Reading. The point I made was, Is the employee protection, in reducing the number of Corporations, really adequate to ensure that the individual worker in this nationalised industry does not labour under a perpetual fear that if he criticises the management in any way, shape or form he runs the risk of being thrown out of the only place where he can obtain similar employment? That is a very real issue. I have spoken to many employees in a number of our nationalised industries, and in talking with employees of organisations such as the B.B.C., these airline Corporations, and only a week ago to a group of employees of the nationalised railways at York, I find they have a very real fear of victimisation should they take a different line from that laid down, sometimes very autocratically, by the existing managements. I therefore suggest that it would have protected the individual workers to a far greater degree to have had a number of Corporations rather than reducing the number, as we are now doing, to two. I feel that the policy being followed at this moment is working towards, not the industrial democracy which the Lord President of the Council continually preaches, but very much towards autocracy in excelsis. That is the effect at any rate on the mind of the individual worker.

A further argument against amalgamation is the need for continuity of policy and of personnel. If we compare the standards of achievement of airline operations in this country with that of other countries, we find a very great dissimilarity over continuity. The most successful airline operating organisations of other countries have persisted in and consistently pursued a clear policy which has been understood by all; and they have retained in the chief positions people who have continued that policy over a considerable period of years.

Let me very briefly indicate exactly what has happened as regards continuity of policy in this country. In 1919 there were four companies in existence. In 1924 they were amalgamated into one company, Imperial Airways, which was then a monopoly undertaking backed by the Government. In 1936 there emerged another company, British Airways, thus making two companies running airlines in this country. In 1938 those two companies were amalgamated into B.O.A.C. In 1945 there were three Corporations, which now, in 1949, are being reduced to two. What sort of impression is created in the minds of the workers in these industries when they see these perpetual changes in Government policy? I am arguing this case on the purely technical ground, because this perpetual change in policy can be laid primarily at the door of the Governments in power before the present Labour Government.

As a further argument against this amalgamation, I would cite my belief that the less efficient organisation—and this is the testing point—is apparently absorbing a more efficient organisation. Let me quote the sort of things that I suggest are palpable inefficiencies, which should not arise, in the organisation of B.O.A.C. I refer particularly to the Western Division, because it has to perform a task similar to that performed by B.S.A.A. Previously in this House I have referred to the wastage of dollars that occurs because of the policy pursued by the Western Division. The Parliamentary Secretary informed me, in answer to a Question, that, between my first suggesting that the base should be brought back from the American side to Filton, for operating the Western Division and maintaining the aircraft there, and the eventual decision being taken by the Corporation to comply with that suggestion, 22 million dollars were expended. I know that taking an earlier decision would not have saved all those dollars, but it would have saved a very considerable proportion of them.

A further indication of my contention that B.O.A.C. are not living up to the standard of efficiency which we should expect is to be seen in their lack of action when the "Queen Elizabeth" and the "Queen Mary" were held up in New York around Christmas time last year, when many passengers were desperately keen to get back to this country. What did the Western Division do? Did they switch as many aircraft as possible on to ferrying those passengers across the Atlantic? Not a bit of it. They continued their ordinary service; and at the same time they continued to use aircraft to bring back to this country personnel, their wives and children, and their baggage to Filton, instead of switching those aircraft, as they should have done had they been keen and on their toes, to carrying those stranded passengers and so earning dollars.

Why was this decision to amalgamate taken? On whose advice was it taken? Is it really a democratic decision, or has it been taken as a result of discussions by the Minister with one or two of the heads of the trade unions and the boards of the Corporations? Have they really got down to the rank and file and asked those who have technical competence in our civil airline operations? I suggest that the boards of the Corporations would, if asked, be pretty well bound to say that they agreed. B.O.A.C., the sort of boa-constrictor which is swallowing the little fellow, would obviously not say "No" to a nice fat meal. The board of B.S.A.A. would not object, because in any case the interests of the chairman will be safeguarded by a Clause in the Bill. The trade unions would have no objection, because they consider that it will result in the demise of a splinter union. I do not think that the Ministry would advise against it, because this same Ministry has been responsible for all the other muddled advice and changes in policy, or at any rate has been there while they were going on, during the last 20 or 25 years.

I believe that instead of this being a really democratic decision taken under a democratic system of operating these airlines, of the type the Lord President has suggested we should work towards under nationalisation, the decision that has been taken is an autocratic one. I have spoken to those responsible at a high level for this policy, and I was told only recently that if an employee, one of the rank and file, of one of these nationalised undertakings were continually to keep in close touch with a Member of this House—I should like the Parliamentary Secretary to take special note of this point, and perhaps reply to it—and perhaps even give confidential information to that Member, if need be to use at his discretion—and Members' discretion should, I suggest, be respected—and should that be discovered, those responsible at the top would recommend that man's dismissal. I think that a most unfortunate attitude of mind to be adopted by those responsible at the top level, because it produces the sort of fear of autocracy to which I referred earlier.

Air-Commodore Harvey

Does that also apply to senior members of the Corporations?

Mr. Cooper

I do not follow the hon. and gallant Gentleman's question.

Air-Commodore Harvey

The hon. Gentleman said that if any employee consistently kept in touch with a Member of Parliament, he would be likely to lose his job. Does that apply to the more senior members of the Corporations?

Mr. Cooper

That is a question which ought to be put, not to me, but to those advocating that sort of policy. Presumably it may so apply. The point that was foremost in my mind when I heard of this attitude was that, during the war hon. Members were most anxious to protect their rights as Members of this House to hear from any man in the Forces who wished to contact a Member on any matter which it was right and proper for that Member to hear, so that there should not be victimisation of those men.

Mr. Daines (East Ham, North)

Could my hon. Friend tell us whether he has any evidence to justify his allegation? Secondly, did I hear him aright when I understood him to claim that it is proper for any employee of the Corporations to give a Member of this House secret and confidential information?

Mr. Cooper

Most certainly, yes. I distinctly remember that during the war—when I am sure my hon. Friend would admit we were all vitally concerned that secrecy should be maintained—on this very issue, which went to a Parliamentary Secretary for consideration, it was held to be right and proper for a Member of this House to hear, if need be, secret and confidential information. That is, after all, a necessary protection which democracy gives to an individual, to prevent victimisation, to prevent the individual from becoming the victim of the system.

Mr. Sargood (Bermondsey, West)

I do not wish to misunderstand the hon. Gentleman, but is he claiming that a Member of this House has the right to set up his own personal organisation with a view to obtaining a constant supply of what might be confidential information?

Mr. Cooper

I am not suggesting that any Member of the House should make a special effort to set up his own grape vine system to obtain secret information, but I do say that a Member should not be precluded from obtaining information from any member of the public, especially those engaged in the nationalised industries, because where those industries become too monopolistic there is always the greater risk of victimisation.

Mr. Deputy-Speaker

I think the hon. Member is getting rather wide of the Bill. He must talk about what is in the Bill, and not about what is not in it.

Colonel Dower

On a point of Order. I do not wish to question your Ruling, Mr. Deputy-Speaker, but is it not a fact that the information which my right hon. Friend the Member for Woodford (Mr. Churchill) obtained before the war about the danger of Germany to this country was obtained by exactly the same means as the hon. Member for West Middlesbrough (Mr. Cooper) has just described?

Mr. Deputy-Speaker

That is not before the House.

Mr. Cooper

As I said earlier, I believe the decisions whether or not to amalgamate should be taken on technical grounds. If that is so, we should realise that the world is a certain shape, that centres of population are where they are, that the Colonial Empire must be served and communications built up. If we analyse the situation from that standpoint we come inevitably to the conclusion, I think, that it would be of the greatest help to the development of our civil airlines if we were to increase, rather than to decrease, the number of Corporations. If we were to increase the number of autonomous divisions or units which will operate in the five essential areas, each of which has distinct and separate technical aspects which must be taken into account, we should have one Corporation to operate the internal areas of England, a second to operate the European, Middle East and Mediterranean airlines, and a third to operate on the Empire air routes——

Mr. Deputy-Speaker

This Bill is designed to amalgamate or merge B.O.A.C. with B.S.A.A., and does not go any wider than that.

Mr. Cooper

I understand that, Sir, but if one is speaking against the Measure in some respects is it not right and proper to suggest alternatives? If that is so, would it not be proper for me to suggest the five alternative possibilities instead of the two in the Bill?

Mr. Deputy-Speaker

It would be outside the scope of the Bill.

Mr. Cooper

Very well; I will make this final point. I believe that if purely technical considerations had weighed with the Minister in deciding whether or not this merger should take place, the decision would have been to increase rather than to decrease the number of Corporations which would operate our airlines in various parts of the world.

8.5 p.m.

Mr. George Ward (Worcester)

The Parliamentary Secretary has come to the House today to ask us to pass a Bill to amalgamate one airways Corporation with another; in other words, to perform a major grafting operation in the constitution of our civil airlines. This major operation is one which we should consider carefully before we consent to its being carried out. The Parliamentary Secretary gave various reasons for asking us to approve this Measure, and what we have to do is ask ourselves whether those reasons are sufficient to justify this major operation and whether the objects which the Bill seeks to achieve can or cannot be achieved by the Bill.

We have been told that the first object of the Bill is that it is to deal with a situation created by the withdrawal of the Tudor aircraft from passenger services; and the second object is to achieve maximum efficiency and economy in B.O.A.C. I do not think we need take the first reason too seriously, because the hon. Gentleman himself admitted, in his opening speech, that the Minister had for some months past been considering this amalgamation quite irrespective of whether the Tudors were withdrawn or not. The question of the Tudors withdrawal is being used as an excuse for carrying out a merger which the Government have wanted to carry out for a considerable time. On the other hand, the Parliamentary Secretary explained that the Tudors' withdrawal was the decisive factor which had tipped the scales in favour of amalgamation, so perhaps it is a reason which deserves a little examination. Let us ask ourselves whether the proposed merger is the best way to deal with a situation which has arisen as a result of the withdrawal of the Tudors.

Personally, I cannot believe that it is, because the situation is purely one created by the temporary shortage of aircraft. It is a problem which concerns the total number of aircraft available, whether they belong to B.S.A.A. or B.O.A.C. If the withdrawal of the Tudors from passenger service has made certain of our routes impossible to operate, it will still be impossible to operate those routes until we get more aircraft, with or without this Bill. The merger by itself could not possibly provide us with more aeroplanes, unless B.O.A.C. happen to have some to spare. If they have we would like to know why they have them to spare. If they have it would have been easy to solve the problem by transferring some, either by sale or charter, to B.S.A.A.

The Parliamentary Secretary made great play about the need of flexibility on the North and South Atlantic routes in order to cope with seasonal traffic peaks. He maintained that this flexibility would be best achieved by having all long-range aircraft under the one Corporation. There may very well be something in that. I agree with the hon. Member for West Middlesbrough (Mr. Cooper), and perhaps with the hon. Member for Reading (Mr. Mikardo) that there may very well be a case for some sort of reorganisation of the three Corporations. I have felt for some time that B.O.A.C. is very much too big and unwieldy compared with the other two Corporations, and especially as compared with B.S.A.A. I do not necessarily accept the solution put forward by my hon. Friend the Member for Keighley (Mr. Ivor Thomas) that the North African route should be given to B.S.A.A. There may be a case for having an Atlantic Corporation to look after the North and South Atlantic routes, and having an Empire Corporation and a European Corporation. That would have great advantages. It would make all three Corporations approximately the same size, and it would also simplify and facilitate the training of aircrew and engineers, because we should then be able to concentrate all the very long-range aircraft in one Corporation, all the medium and fairly long-range aircraft in another Corporation and all the short-range aircraft in the third Corporation. I can see that there would be some advantages in that.

Therefore, I do not maintain dogmatically and rigidly that we ought to stick exactly to the three Corporations as they are at present constituted. We have never considered that they were the be-all and end-all of State airline possibilities. On the other hand, we have maintained and still do that B.O.A.C. is very much too big, and by grafting B.S.A.A. onto it we shall merely make it bigger. I am told that one of the main objections to having an Atlantic Corporation is that dollar paying passengers flying from New York through London to Empire routes, such as to Australia, will dislike changing aircraft in London, or in other words that they like to be carried all the way through in one aircraft. If I want to fly from here to San Francisco, I do not find it any particular hardship to fly from here to New York by B.O.A.C. and the rest of the way on another line. I can book my passage all the way through in sterling from London. I do not propose to press the point, except to say it rather astonishes me that we have not heard anything about it in this Debate until the hon. Member for Middlesbrough made his speech. I do not know whether this policy has been examined by the Government, but it does seem to meet all the objects they are trying to achieve by this ridiculous amalgamation.

Clearly, then, the first reason given for the merger, the situation caused by the withdrawal of the Tudors, was not really taken any more seriously by the Parliamentary Secretary than it was by those on this side of the House. If he refers to the statement he made to the House on 15th March he will notice that towards the end of his speech he said: Proposals for dealing with the deficiency in the combined fleets of the Corporations are still under consideration."—[OFFICIAL REPORT. 15th March, 1949; Vol. 462, c. 1924.] In other words, he had not the slighest idea how this would solve the problem created by the Tudors. In my submission, nothing he has said today has got us any further towards a solution. He is apparently pinning his hopes on the ten Boeing Stratocruisers, when they are delivered and the Canadairs, but that still does not make this Bill necessary, because these aircraft are not bought by B.O.A.C. but by the Minister of Supply, and they can be allocated to any Corporation the Minister thinks fit—they can be allocated to the Atlantic Corporation instead of to B.O.A.C., and in any case it does not make the slightest difference because it is all paid for by the Government. I think we can ignore the first reason given by the Parliamentary Secretary.

I now turn to the second reason, the idea that in some way the merger is going to increase the economy and the efficiency of B.O.A.C. The Parliamentary Secretary mentioned today such things as booking offices and road transport services. Is that sufficient reason for amalgamating the two Corporations into one great unwieldy bulk? Why cannot we co-ordinate services of that kind without any amalgamation at all, which is a perfectly easy thing to do? It would merely mean combining the services of that sort to serve all three Corporations. The Parliamentary Secretary said in his statment: The amalgamation will not mean that the smaller Corporation will simply be swallowed up by the larger."—[OFFICIAL REPORT, 15th March, 1949; Vol. 462, c. 1923.] If it does not mean that, then I should like to know what it does mean. Of course it will be swallowed up. How is it possible for B.S.A.A., having completely lost its identity, to have any influence on the larger Corporation? How can it possibly improve the efficiency of the larger Corporation which has swallowed it up? The only way in which the State Corporations have any hope of improving their economy and efficiency is by rivalry. I purposely avoided the word "competition" because there seems to be a certain amount of argument on that in which I do not propose to become involved. I prefer "rivalry," because although these Corporations may not compete one with the other, they should have a sense of rivalry whatever routes they operate and aircraft they use. Surely that is precisely what the Government are here seeking to avoid. The Government are deliberately destroying the only yardstick we have got of whether the airlines financed by the taxpayers are being run efficiently or inefficiently. My hon. Friend the hon. Member for Mid-Bedford (Mr. Lennox-Boyd) gave some excellent examples of the way in which we have in the past been able to compare the results of one Corporation with another. If this Bill is passed, these comparisons will no longer be possible, and without these comparisons criticisms in this House by the elected representatives of the taxpayers who fork out the money will be made very much more difficult. I do not want to be too controversial in this matter, but perhaps we may be forgiven for suspecting that that would suit the Government extremely well.

I want now to touch on this vexed question of redundancy. The Parliamentary Secretary emphasised that economies which will be effected as a result of this proposed merger will take the form of expanding business, without engaging further staffs, rather than large scale dismissals. While I welcome that statement from him and think it very important, I find it difficult to believe that the staffs of B.S.A.A. and B.O.A.C. are going to be convinced unless he publicly repudiates the statement he made on 15th March, when he said: Any staff redundancies resulting from the merger will be shared fairly between the two Corporations."—[OFFICIAL REPORT, 15th March, 1949; Vol. 462, c. 1924.] That in itself is excellent. If there must be redundancies let them be shared, but the hon. Gentleman said this afternoon that there would be no redundancies. He cannot have it both ways and, for the sake of the employees in the Corporations, he ought immediately to repudiate the statement he made on 15th March.

Mr. Lindgren

I am only too pleased to help. The Corporations are obliged by their procedure of negotiation with the trade unions to enter discussions with them prior to changes of policy taking place, in order that they may be informed and able to criticise. As a result of consultation on an agreement to a merger such as this, the trade unions, quite rightly, required that if there was to be any redundancy there should be agreed procedure for it. This is a precautionary measure by the trade unions to protect their members. My statement is equally true. As a result of general development capacity, there will be very little redundancy, but if there should be one, two, three, four, or 20 cases, they will be dealt with by the procedure agreed upon by the trade unions.

Mr. Ward

I am obliged to the hon. Gentleman. I should not think it easy for him suddenly to say, "Of course, there will be no redundancy," when there have been very large scale dismissals in B.O.A.C. over the last few months. I think he must be rather more explicit in his statements, because, on the face of them, they conflict. There may have to be further reductions in the cause of economy but if it is found possible to effect a few more economies by cutting down staff, I want to impress on the House that that process in itself does not make the Corporation any more efficient. One can go on reducing costs of any business ad infinitum, without ever making a profit. It should be the aim of the Corporations to build up the business and to show a profit and not to keep on cutting down without showing a profit at all. The only way to show a profit in this, or any other business, is to attract custom. In this business the only way is by being able to attract fare-paying passengers in very large numbers by operating a slightly better airline than any competitors. This can only be done by studying the methods of other airline operators, improving on them and continually going out for new business and developing new services. A mere policy of contraction, so far from increasing efficiency, in fact tends to decrease it, because it is bound to have an extremely unsettling effect on the staff of the Corporation, who are continually fearful lest they become redundant.

I am not saying there should be no reductions in the staff of B.O.A.C., but if they had built up their staffs gradually as they increased their business instead of immediately building up this great empire from the outset, none of this difficulty would have arisen. It is perfectly absurd to drag B.S.A.A. into this scheme, for if it were left alone it would be able to conduct its affairs successfully and probably absorb some of the redundant staff of B.O.A.C. This Bill will upset quite unnecessarily a Corporation which had a fine spirit, enthusiasm and plenty of confidence in the future. Today it has no confidence and no future.

The Parliamentary Secretary in his statement today said that B.S.A.A. exhibited certain qualities which must on no account be lost. He went on to say that it had developed a most valuable team spirit and a collective loyalty of its own. By this amalgamation B.O.A.C. may be able to make some use of the experience gained by B.S.A.A., but there will be no team spirit left and no collective loyalty. If this Bill goes through this evening those qualities will be entirely lost. Neither of the two main reasons given by the Parliamentary Secretary for asking us to pass this Measure will in any way stand up to examination. They are not good enough reasons for this major alteration in our air services. This Bill cannot solve the aircraft problem at all. It will tend to reduce rather than increase efficiency, and while some economies may be effected by cutting down the staff of B.O.A.C., this could be done whether the two Corporations were merged or not.

Finally, in introducing this Bill the Government have thrown overboard the main principle on which the whole of the Civil Aviation Act was based. We on this side of the House hate the whole sordid, dreary business of nationalisation, but while we have to have State airlines—and we hope and pray we shall not have them very much longer—we realise that we have to have precisely the qualities which the Lord President laid down on the Second Reading of the Civil Aviation Bill, and we cannot have those qualities with less than three Corporations. For these reasons we ask the House this evening to throw out this miserable little Bill.

8.30 p.m.

Mr. Lindgren

With one exception—and I will deal with it separately—we can claim that the Debate today has been useful. The exception is the reference made by the hon. Gentleman the Member for Mid-Bedford (Mr. Lennox-Boyd) to Lord Douglas. Why hon. Gentlemen opposite feel so bitter because a high-ranking officer or a man eminent in business or commerce joins the Socialist Party I do not know. The Conservative Party have not an exclusive right to every eminent person associated with business or the Services. The hon. Gentleman made a generous reference to Sir Harold Hartley and we join with him on that, as we do when he speaks, as he did, of Sir Miles Thomas. He has also made generous references to Mr. Gerald d'Erlanger and others. All those persons are not associated with the Socialist Party, and why should he get bitter over some person like Lord Douglas? It does not matter if an ordinary working-class lad like myself becomes associated with the Labour Party, but if a high-ranking officer does, it, digs deeply into Tory hearts. The only national party in this House is the party which sits on the Government Benches because it is representative of every trade, profession and calling, except the idle rich, and they are represented on the other side of the House.

Mr. Lennox-Boyd

Hurry up with the Debate.

Mr. Lindgren

I resent and dissociate myself and my hon. Friend from the remarks made against persons like Lord Douglas. In the few months that he has been with us he has done a job creditably and in keeping with his great record with the Royal Air Force.

I should like now to deal with the Debate and the points made to the extent that time permits. First, there is the reference to the amalgamation of B.E.A. with B.O.A.C. I repeat the statement which I made today that there is no intention of amalgamating those two Corporations for the obvious reason that the type of operation of each is entirely different from the other. The former uses twin-engined aircraft and operates on internal and Continental routes. The whole operations and traffic of the two Corporations are entirely different. It is obviously a better method of organisation to have the two Corporations. I am immediately challenged, and quite rightly, about the statement which I made in this House in reply to a Question in 1948, when I said that there was no intention of amalgamating B.O.A.C. and B.S.A.A.C. That statement was made factually and correctly in accordance with the intentions of His Majstey's Government at that time. What has happened? I hope that no Government Department and no Minister—it will certainly not be my attitude so far as I have any responsibility—will adopt the attitude that the condition of affairs that obtains in the Ministry at the time the Minister takes charge is to obtain for all time.

Looking at the problem of air transport I felt it was open to consideration whether or not B.O.A.C. and B.S.A.A.C. ought to be amalgamated, and I will say why. We have heard about this grand spirit in B.S.A.A.C. My mind was first directed towards considering whether B.O.A.C. and B.S.A.A.C. should be amalgamated because the only representation which has been made to us by any staff of any Corporation was made by the B.S.A.A.C. staff. Their pilots—I am sorry that I do not see my hon. Friend the Member for West Middlesbrough (Mr. Cooper) here—were nervous about the conditions under which they were asked to operate. They took the correct course and went to their trade union and stated their case, and the General Secretary of B.A.L.P.A. came to me in my capacity as Parliamentary Secretary, because the Minister was away at the time. He said that these representations had been made to him as General Secretary and he thought they should be looked into.

Those representations having been made by a responsible person on behalf of the employees, I took the action which any Parliamentary Secretary should take in such circumstances. I reported the information to the Minister, who said that we would have the conditions looked into. Lord Nathan asked Sir Frederick Bowhill, who is the Chief Aeronautical Adviser to the Ministry of Civil Aviation and Chairman of the Air Safety Board, to conduct investigations into the operational standards of B.S.A.A.C. As a result of that I took more interest than I had previously done in examining the possibility of amalgamation of the two Corporations. There was a change of Minister, and the present Minister found that B.S.A.A. was opposed to the idea and in the circumstances felt that there should not be an amalgamation. Discussions which took place leaked out in some way and evidently they reached the ears of Members of Parliament, and a Question was put down. The reply that was given was factually correct in the light of the then Government policy.

Later the Tudor aircraft was withdrawn from service. That completely changed the situation. How can an airline operate without any aircraft? Hon. Gentlemen who say that they will oppose this Bill simply have not faced the Question. I am willing to give way to anyone who wishes to intervene on this point. In the light of the withdrawal of the Tudor aircraft and the fact that B.S.A.A.C. had only Yorks and Lancastrians, and were losing traffic, not because of their operational standards but because people, when they have the choice between a York or Lancastrian and a modern aircraft such as the Constellation and others which are available, will certainly not travel by a York or Lancastrian——

Mr. Lennox-Boyd

A number of my colleagues and myself have made it quite plain that there is no reason why Constellations or Canadairs could not have been leased or sold to this Corporation through Government purchase and the Ministry of Supply, as is being done in any event.

Mr. Lindgren

I wonder whether hon. Gentlemen have considered the dollar difficulty. We cannot buy Constellations or Canadairs today because of lack of dollars. So the only alternative remaining is that of taking half the six Constellations of B.O.A.C. and some of the 22 Canadairs that are to be delivered. Do I understand that it is proposed, that we should divide the Constellations that are available, and the Canadairs—they are not yet available—between B.S.A.A.C. and B.O.A.C.?

Mr. Ward

Why not?

Mr. Lindgren

Because it would be wasteful to create two organisations to deal with the same type of aircraft at the same time. Would hon. Gentlemen opposite, having responsibility for an organisation, set up two separate maintenance organisations to deal with similar types of aircraft operating over the same routes? What would the Opposition say if, in fact, we had Constellations being maintained for B.S.A.A. as a separate organisation at London Airport; a separate organisation for B.O.A.C. Constellations at Filton; a separate organisation for 15 Canadairs for B.O.A.C. at London Airport and a separate organisation for seven Canadairs at Langley?

Air-Commodore Harvey

Is not that a good case for having a fourth Corporation for maintenance?

Mr. Lindgren

Surely that would take away one of the fundamental factors in airline operation. I am surprised at the hon. and gallant Member for Macclesfield (Air-Commodore Harvey). In the organisation with which he is associated—and with which he has every right to be proud to be associated—would he operate aircraft, with all the responsibility that entails, for the maintenance of which he is not responsible?

Air-Commodore Harvey

It is done in the Royal Air Force under the centralisation scheme throughout the Service.

Mr. Lindgren

I am not responsible for the Royal Air Force—at the moment anyway. I am responsible for civil aviation. So far as the Royal Air Force is concerned, it can answer for its general standards of operation and maintenance. I am certain that hon. Gentlemen will agree that, so far as the Royal Air Force is concerned, its standards of maintenance and operation are for a totally different purpose. If hon. Members opposite are to be taken seriously, more often than not they are telling me that we should not look at the Royal Air Force at all—and particularly anybody who has served in it, especially if he is a Marshal of the Royal Air Force.

Mr. Ward

The Parliamentary Secretary speaks as though this were a permanent difficulty; as though we shall never again be able to supply a third Corporation with any aeroplanes, except by taking them from B.O.A.C. That is absurd. My point is that we should keep in being the organisation and structure of a third Corporation against the day when new British aeroplanes come along.

Mr. Lindgren

And that is in the sweet by-and-by. If hon. Gentlemen opposite would really put as much vim and vigour into attacking the aircraft industry as they do the airline operators, they might be doing us some good.

Mr. Ward

That is the job of the Parliamentary Secretary; why does he not do it?

Mr. Lindgren

The hon. Member's job is opposition.

Mr. Lennox-Boyd

Would the Parliamentary Secretary amplify his remark a little? It is a rather extraordinary remark to make at a time when we are getting some technical superiority over our commercial rivals. I am sure the Minister of Supply would be a little surprised at that remark.

Mr. Lindgren

I will justify it, so far as I can. The present difficulty arises because of the failure of the availability of British aircraft. Tudors have gone out. The only aircraft which promises to be in the running are the Hermes. With his hand on his heart—or where his heart ought to be—Sir Handley Page promised that 25 Hermes would be delivered by the end of June this year. We have not yet received the first aircraft.

Mr. Lennox-Boyd

Who is the next one? Who will the Parliamentary Secretary attack next?

Mr. Lindgren

I am not going to attack anybody. All I am saying is that the maintenance and structure of B.S.A.A. cannot wait until there is availability of aircraft. All we have at the moment are six Constellations in operation on the North Atlantic; 10 Boeings to be delivered this year, 22 Canadairs, and 25 Hermes when we get them. After all, if we had waited until we had the aircraft suitable for B.S.A.A., there would have been no traffic whatever on the route.

Air-Commodore Harvey

I am obliged to the Parliamentary Secretary. But before he leaves the point, I am sure he will agree that large sums of money have been made available to B.O.A.C. to buy the Stratocruiser, a comparatively untried aircraft. Would not it have been better to make the money available to buy more Contellations and give some of them to B.S.A.A.?

Mr. Lindgren

Everyone can be wise after the event.

Air-Commodore Harvey

No—before.

Mr. Lindgren

Let us face the fact. The contract for the purchase was made when the hon. Member for Keighley (Mr. Ivor Thomas) was Parliamentary Secretary back in 1946.

Mr. Ivor Thomas

I must say that I do not accept that.

Mr. Lindgren

Let me put it in this way. The contract for the purchase of the Stratocruisers was made by B.O.A.C. with Government sanction in 1946.

Mr. Ivor Thomas

Obviously, I must not go into details, but in fact that is not exactly the case. If the attempt is to place any personal responsibility upon me——

Mr. Lindgren

Not at all. I am not trying to place any personal responsibility on anyone. All I say is that prior to my coming to the Ministry in October, 1946, an order had been placed by B.O.A.C., with Government authority, for the purchase of the six Stratocruisers. To break that contract and to switch the purchase to Constellations in 1948 was simply impossible. I am sure that hon. Gentlemen opposite will not say that two years after a contract has been made with an aircraft manufacturer we should cancel it and ask to be allowed to switch to something totally different. At least, that is not the way in which business should be done.

Air-Commodore Harvey

It is a very difficult contract.

Mr. Lindgren

I am not arguing whether it is or is not a tight contract. The fact is that under present circumstances this is what we must do. If we had waited until aircraft were available for use by B.S.A.A. there would have been no traffic on the routes, because over the whole of the routes the traffic would have been picked up by other operators. That is the simple fact.

Much has been said about the team spirit in B.S.A.A., and the inference is that it is something better than that which exists in B.O.A.C. The team spirit referred to was not altogether what it should be in B.S.A.A. as is evidenced by what I said earlier about the report to B.A.L.P.A. and their approach to me. When John Brackley came into the chief executive position at B.S.A.A., a very fine spirit indeed began to be shown. I agree that there is a very good spirit indeed now, as the hon. Member for Worcester (Mr. Ward) said and as I admitted earlier today. But B.S.A.A. have not got a monopoly in that respect. I have experience among all the Corporations. The spirit in B.O.A.C. is just as good as that in B.S.A.A. There is a remarkably fine spirit in B.O.A.C. of pride in their craft, pride in their achievements and in their standard of operations. In no group is that more obvious perhaps than it is among the flying crews. Among them there is a really first-class spirit. I emphasise the point that there is no monopoly of good spirit and determination to do their job properly in B.S.A.A. It is common to both Corporations.

I was asked why it was that we did not create an Atlantic Division and give B.S.A.A. the North Atlantic routes of B.O.A.C. That possibility was considered very seriously indeed. But would it really meet the position which hon. Gentlemen opposite say exists under the amalgamation of B.S.A.A. and B.O.A.C.? In fact, it would be just as much an amalgamation of B.S.A.A. and B.O.A.C. If we created the Atlantic Division, what would happen? A North Atlantic and a South Atlantic Division would be created; but all the operating experience of the North Atlantic is possessed by the pilots of B.O.A.C. I do not belittle the pilots of B.S.A.A. in any way. As was said by the hon. and gallant Member for Macclesfield, they are men who had a distinguished record in the Royal Air Force during the war. That is true, but the men with the major experience of airline operation, those who are accepted all over the world as the finest pilots, are those of B.O.A.C. on the North Atlantic route, where the aircraft will be the Constellations and Boeings belonging to B.O.A.C. It would be just as if the little brother had joined up with the big fellow if we had the two divisions, and it would be just the same as if there were complete amalgamation of the two Corporations.

Then it is said that we are losing the only yardstick of efficiency now that B.S.A.A. is going out. Hon. Gentlemen opposite do not do themselves credit. There is no yardstick of efficiency in testing the operation of a route by the West Coast of Africa down to Buenos Aires as compared with the North Atlantic operation. We just cannot test the two, because the type of operation, the staging, the type of aircraft and the pay-load and operating conditions are all different. It is simply impossible to test it that way. The only way to test B.O.A.C. on the North Atlantic route is with Pan-American or K.L.M. To suggest that a yardstick of efficiency can be made by contrasting the operation of different aircraft over different routes is quite misleading.

Mr. Ward

If the Parliamentary Secretary does not believe that, perhaps he will have a quiet word with the Lord President of the Council.

Mr. Lindgren

I am not being drawn into what the Lord President says or does. All I am concerned with is doing my job, and I have tried, as long as I have been in it, to understand it and to be able to make out a case on behalf of it.

Equally, in regard to the point made about competition, when the hon. Member for Mid-Bedford spoke about the elimination of competition, he was completely wrong, and I am sure he does not really believe it! The operations of K.L.M., Swissair, Pan-American and B.O.A.C. are all part of an international job of civil aviation, in which we test the efficiency of an organisation by its standard of operation and its costs over the same routes, even though over those same routes they may have different types of aircraft. When I joined the railways, there were 150 different railway companies, and when the Tory Government passed the Railways Act, 1921, they turned 111 railway companies into four. It is true that this Government improved on that by turning those four into one.

Mr. Lennox-Boyd

Wait until Sunday midnight. The hon. Gentleman had better finish his speech before then.

Mr. Lindgren

Hon. Members rejoice when there are little difficulties with regard to a nationalised industry. [Interruption.] If hon. Gentlemen opposite make cracks at me, they must expect something back. In transport organisations, private enterprise itself tended to create a monopoly and a single organisation for the major trunk services. That has been done in shipping, in railways, in road transport and it has been done in air transport as well.

Another vital point with which I wish to deal is the question of the S.R.45, which was raised by the hon. Member for the Isle of Wight (Sir. P. Macdonald), who apologised to me very nicely for the fact that he had a very important social function to attend tonight and could not be present for my winding-up. But as he and other hon. Members have raised the point, I should like to deal with it now. First of all, the S.R.45 contract continues, and B.O.A.C. accepts the obligations entered into by B.S.A.A. in regard to the S.R.45. Again, I deprecate hon. Members opposite insinuating that B.O.A.C. is anti-flying boat. B.O.A.C. are the only large flying boat operators in the world; they are the only people who have such a great experience of this branch of aviation, and, in fact, that is a further reason for this Bill being introduced. B.S.A.A. could not have operated the S.R.45 without the help of B.O.A.C.'s flying boat experience, crews and maintenance organisation and, in fact, would have had to take over the B.O.A.C. base, and there would have had to be conversion training of pilots and maintenance staff transferred from B.O.A.C.

Medium-class flying boat operation is not economic from the point of view of the flying boat operator because, over a large part of the world, he has to bear the cost of a marine base in addition to that of a land base, and operate two types of aircraft. He has to bear, over and above the cost of the land plane, something which other operators do not bear. If one could only get more people to operate flying boats there would be a reduction in costs, but I believe that there is a much greater future for the large flying boat than there is for the large land plane. I have said in public that the operation of the flying boat is quite naturally a British activity and one in which we hope to carry on the old British tradition of maritime operations, which was carried on so well by the Merchant Navy. But to suggest that B.O.A.C. is anti-flying boat is completely wrong. I invite hon. Members opposite to go to Hythe and meet the flying boat crews of B.O.A.C. who are most enthusiastic about their type of aircraft.

Air-Commodore Harvey

Is the Parliamentary Secretary saying that he did not realise that there were sections of B.O.A.C. who were anti-flying boat?

Mr. Lindgren

In the whole of the air transport industry there are, of course, groups of people who are pro-flying boat and groups who are anti-flying boat. The controversy of land plane versus flying boat has been going on for ages. It has gone on in the Royal Air Force, in the Navy, and everywhere that flying men meet. In fact, the flying people are like doctors, dentists and lawyers—the more expert they are, the more they agree to differ; and flying men are no different.

I will now say a word about the question of redundancy. So far as we can see at the moment, there will be little redundancy; in fact, practically none. In so far as there is any redundancy or might be any, it will be dealt with on an agreed procedure. The National Joint Council for Civil Air Transport and the men themselves at the particular bases will deal with any redundancies that arise. The men themselves will decide who are the persons to go, in the light of the general arrangements. It is equally true that the fact that the men of B.S.A.A. may be at some depôts which are not directly concerned with Canadair maintenance, will not prejudice them in any shape or form. They are part of the organisation and they will be treated as such.

Reference was made to the fact that persons appeared to be assuming that this Bill had already become law and they had moved from the administration of B.S.A.A. into the buildings of B.A.O.C. That is not true. What has happened is that the chairman of B.S.A.A. has been made a director of B.O.A.C., and Mr. Whitney Straight, Chief Executive of B.O.A.C., has been made a director of

B.S.A.A. in order that there shall be closer co-ordination while general development of the merger takes place. All that has happened is that Mr. Booth, who will be one of the deputy-chairmen when this Bill becomes law, has moved across to B.O.A.C. in order to deal with his function as a director of B.O.A.C.

Air-Commodore Harvey

What about B.S.A.A.?

Mr. Lindgren

Surely that ought to be the biggest guarantee to the B.S.A.A. staff that they are going to be treated fairly. The chairman of their organisation is to be made one of the deputy-chairmen of the other organisation, and one of his main functions is to see that his staffs are fairly dealt with.

I was going to deal with the point made by my hon. Friend the Member for West Middlesbrough (Mr. Cooper), but as he is not here I think I may be forgiven if I do not deal with it. The last point with which I shall deal is the point which was raised by my hon. Friend the Member for Reading (Mr. Mikardo) concerning what he alleged was the lack of information among the panels at Langley. I give this guarantee. If there is any difficulty it will be dealt with immediately, because B.O.A.C. and B.S.A.A. are most anxious that the consultative machinery shall work effectively.

I ask the House to give this Bill a Second Reading to enable us to develop civil aviation.

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

The House divided: Ayes, 224: Noes, 98.

Division No. 196.]	AYES	[9.5 p.m.
Adams, Richard (Balham)	Bramall, E. A.	Davies, Edward (Burslem)
Albu, A. H.	Brooks, T. J. (Rothwell)	Davies, S. O. (Merthyr)
Allen, A. C. (Bosworth)	Broughton, Dr. A. D. D.	Deer, G.
Alpass, J. H.	Brown, T. J. (Ince)	Delargy, H. J.
Attewell, H. C.	Burden, T. W.	Diamond, J.
Awbery, S. S.	Burke, W. A.	Dobbie, W.
Ayles, W. H.	Butler, H. W. (Hackney, S.)	Dodds, N. N.
Bacon, Miss A.	Callaghan, James	Dugdale, J. (W. Bromwich)
Balfour, A.	Castle, Mrs. B. A.	Ede, Rt. Hon. J. C.
Barnes, Rt. Hon. A. J.	Champion, A. J.	Edwards, John (Blackburn)
Barstow, P. G.	Cobb, F. A.	Edwards, W. J. (Whitechapel)
Barton, C.	Cocks, F. S.	Evans, Albert (Islington, W.)
Battley, J. R.	Collick, P.	Evans, E. (Lowestoft)
Bechervaise, A. E.	Collindridge, F.	Evans, John (Ogmore)
Benson, G.	Collins, V. J.	Evans, S. N. (Wednesbury)
Beswick, F.	Colman, Miss G. M.	Ewart, R.
Bing, G. H. C.	Cook, T. F.	Farthing, W. J.
Blackburn, A. R.	Corbet, Mrs. F. K. (Camb'well, N. W.)	Fernyhough, E.
Blenkinsop, A.	Corlett, Dr. J.	Freeman, J. (Watford)
Blyton, W. R.	Cove, W. G.	Gaitskell, Rt. Hon. H. T. N.
Bowden, Flg. Offr. H. W.	Daggar, G.	Ganley, Mrs. C. S.
Braddock, Mrs. E. M. (L'pl. Exch'ge)	Daines, P.	Gibson, C. W.
Glanville, J. E. (Consett)	Mallalieu, J. P. W. (Huddersfield)	Skinnard, P. W.
Grey, C. F.	Mayhew, C. P.	Smith, C. (Colchester)
Grierson, E.	Mellish, R. J.	Smith, H. N. (Nottingham, S.)
Griffiths, D. (Rother valley)	Messer, F.	Smith, S. H. (Hull, S. W.)
Griffiths, Rt. Hon. J. (Llanelly)	Middleton, Mrs. L.	Sorensen, R. W.
Guy, W. H.	Mitchison, G. R.	Soskice, Rt. Hon. Sir Frank
Hale, Leslie	Monslow, W.	Stewart, Michael (Fulham, E.)
Hall, Rt. Hon. Glenvil	Moody, A. S.	Strauss, Rt. Hon. G. R. (Lambeth)
Hamilton, Lieut.-Col. R.	Morley, R.	Stross, Dr. B.
Hannan, W. (Maryhill)	Morris, P. (Swansea, W.)	Stubbs, A. E.
Hardy, E. A.	Morrison, Rt. Hn. H. (Lewisham E.)	Sylvester, G. O.
Hastings, Dr. Somerville	Mort, D. L.	Taylor, H. B. (Mansfield)
Haworth, J.	Moyle, A.	Taylor, R. J. (Morpeth)
Henderson, Joseph (Ardwick)	Nally, W.	Thomas, D. E. (Aberdare)
Hobson, C. R.	Naylor, T. E.	Thomas, I. O. (Wrekin)
Holman, P.	Neal, H. (Claycross)	Thorneycroft, Harry (Clayton)
Holmes, H. E. (Hemsworth)	Nichol, Mrs. M. E. (Bradford, N.)	Thurtle, Ernest
Horabin, T. L.	Nicholls, H. R. (Stratford)	Timmons, J.
Houghton, A. L. N. D.	Noel-Buxton, Lady	Titterington, M. F.
Hubbard, T.	Oldfield, W. H.	Tolley, L.
Hudson, J. H. (Ealing, W.)	Oliver, G. H.	Tomlinson, Rt. Hon. G.
Hughes, Emrys (S. Ayr)	Orbach, M.	Ungoed-Thomas, L.
Hughes, H. D. (W'lverh'pton, W.)	Paget, R. T.	Usborne, Henry
Hutchinson, H. L. (Rusholme)	Paling, Will T. (Dewsbury)	Vernon, Major W. F.
Hynd, H. (Hackney, C.)	Palmer, A. M. F.	Viant, S. P.
Irving, W. J. (Tottenham, N.)	Pargiter, G. A.	Walker, G. H.
Isaacs, Rt. Hon. G. A.	Parkin, B. T.	Warbey, W. N.
Jay, D. P. T.	Paton, Mrs. F. (Rushcliffe)	Webb, M. (Bradford, C.)
John, W.	Paton, J. (Norwich)	Weitzman, D.
Jones, Rt. Hon. A. C. (Shipley)	Pearson, A.	Wells, P. L. (Faversham)
Jones, D. T. (Hartlepool)	Peart, T. F.	Wells, W. T. (Walsall)
Jones, Elwyn (Plaistow)	Poole, Cecil (Lichfield)	West, D. G.
Jones, P. Asterley (Hitchin)	Popplewell, E.	White, H. (Derbyshire, N. E.)
Keenan, W.	Porter, E. (Warrington)	Whiteley, Rt. Hon. W.
King, E. M.	Porter, G. (Leeds)	Wigg, George
Kinley, J.	Price, M. Philips	Wilkes, L.
Lang, G.	Proctor, W. T.	Wilkins, W. A.
Lavers, S.	Pryde, D. J.	Willey, F. T. (Sunderland)
Lee, F. (Hulme)	Pursey, Comdr. H.	Willey, O. G. (Cleveland)
Leslie, J. R.	Randall, H. E.	Williams, D. J. (Neath)
Lewis, T. (Southampton)	Ranger, J.	Williams, Ronald (Wigan)
Lindgren, G. S.	Raid, T. (Swindon)	Williams, Rt. Hon. T. (Don Valley)
Logan, D. G.	Rhodes, H.	Williams, W. R. (Heston)
Lyne, A. W.	Richards, R.	Willis, E.
McAdam, W.	Ridealgh, Mrs. M.	Wills Mrs. E. A.
McEntee, V. La T.	Robinson, K. (St. Pancras)	Wilmot, Rt. Hon. J.
McGhee, H. G.	Ross, William (Kilmarnock)	Wilson, Rt. Hon. J. H.
Mack, J. D.	Royle, C.	Woodburn, Rt. Hon. A.
McKay, J. (Wallsend)	Sargood, R.	Yates, V. F.
Mackay, R. W. G. (Hull, N. W.)	Segal, Dr. S.	Younger, Hon. Kenneth
McLeavy, F.	Sharp, Granville
Macpherson, T. (Romford)	Shurmer, P.	TELLERS FOR THE AYES:
Mainwaring, W. H.	Silverman, J. (Erdington)	Mr. Snow and Mr. George Wallace.
Mallalieu, E. L. (Brigg)	Simmons, C. J.
NOES
Agnew, Cmdr. P. G.	Fraser, Sir I. (Lonsdale)	Lyttelton, Rt. Hon. O.
Baldwin, A. E.	Fyfe, Rt. Hon. Sir D. P. M.	Mackeson, Brig. H. R.
Beamish, Maj. T. V. H.	Gage, C.	Maclay, Hon. J. S.
Birch, Nigel	Galbraith, Cmdr. T. D. (Pollok)	Maclean, F. H. R. (Lancaster)
Bowen, R.	Galbraith, T. G. D. (Hillhead)	Macmillan, Rt. Hon. Harold (Bromley)
Bower, N.	Gammans, L. D.	Macpherson, N. (Dumfries)
Boyd-Carpenter, J. A.	Granville, E. (Eye)	Maitland, Comdr. J. W.
Bracken, Rt. Hon. Brendan	Gridley, Sir A.	Marples, A. E.
Braithwaite, Lt.-Comdr. J. G.	Grimston, R. V.	Morris, Hopkin (Carmarthen)
Brown, W. J. (Rugby)	Harris, F. W. (Croydon, N.)	Morrison, Rt. Hn. W. S. (Cirencester)
Buchan-Hepburn, P. G. T.	Harvey, Air-Comdre. A. V.	Neven-Spence, Sir B.
Butcher, H. W.	Headlam, Lieut.-Col. Rt. Hon. Sir C.	Noble, Comdr. A. H. P.
Carson, E.	Hinchingbrooke, Viscount	Odey, G. W.
Channon, H.	Hogg, Hon. Q.	O'Neill, Rt. Hon. Sir H.
Clarke, Col. R. S.	Hollis, M. C.	Osborne, C.
Conant, Maj. R. J. E.	Hope, Lord J.	Peake, Rt. Hon. O.
Cooper-Key, E. M.	Hund, A.	Peto, Brig. C. H. M.
Crosthwaite-Eyre, Col. O. E.	Hutchison, Lt.-Cm. Clark (E'b'rgh W.)	Pickthorn, K.
Dodds-Parker, A. D.	Hutchison, Col. J. R. (Glasgow, C.)	Prior-Palmer, Brig, O.
Dower, Col. A. V. G. (Penrith)	Jennings, R.	Raikes, H. V.
Drewe, C.	Lancaster, Col. C. G.	Ramsay, Maj. S.
Dugdale, Maj. Sir T. (Richmond)	Lennox-Boyd, A. T.	Rayner, Brig. R.
Erroll, F. J.	Lipson, D. L.	Roberts, Emrys (Merioneth)
Fleming, Sqn.-Ldr. E. L.	Lloyd, Maj. Guy (Renfrew, E.)	Ropner, Col. L.
Fletcher, W. (Bury)	Lloyd, Selwyn (Wirral)	Savory, Prof. D. L.
Foster, J. G. (Northwich)	Low, A. R. W.	Scott, Lord W.
Fox, Sir G.	Lucas-Tooth, Sir H.	Smiles, Lt.-Col. Sir W.

Snadden, W. M.	Turton, R. H.	Williams, Gerald (Tonbridge)
Spence, H. R.	Wadsworth, G.	Willoughby de Eresby, Lord
Strauss, Henry (English Universities)	Wakefield, Sir W. W.	York, C.
Teeling, William	Ward, Hon. G. R.
Thomas, Ivor (Keighley)	Watt, Sir G. S. Harvie	TELLERS FOR THE NOES:
Thorp, Brigadier R. A. F.	Wheatley, Colonel M. J. (Dorset. E.)	Mr. Studholme and
Touche, G. C.	Williams, C. (Torquay)	Mr. Wingfield Digby.

Question put, and agreed to.