COMMONWEALTH TELEGRAPHS BILL

HC Deb 22 March 1949 vol 463 cc225-65

Order for Second Reading read.

3.55 p.m.

The Postmaster-General (Mr. Wilfred Paling)

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

This Bill marks the culmination of a process which has been going on for many years, and I think that the only way of presenting it to this House is to give hon. Members something of the historical background. They will find the story an interesting one, because it touches on a part of Commonwealth business which is rather specialised and is not often discussed in this House, but a part which is of vital importance at all times to the Commonwealth's well being. What this Bill deals with is the co-ordination of the nervous system of the whole Commonwealth, of its system of communication not only within itself, but with the rest of the world—a complex network of cables and wireless links which binds together the countries of the Commonwealth in all the continents, and at the same time provides them with essential communications with many foreign countries.

The story divides itself into four phases. First of all there is a period of 30 years from 1872 onwards. During this time the Eastern Telegraph Company, the main predecessor of Cable and Wireless Limited, constructed its vast network of telegraph cables and acquired the networks of smaller British companies. It thus—with its associate companies—gained a virtual monopoly of external telegraph services throughout the Commonwealth—apart from Canada and the West Indies—and a predominant position in South America, too. It was this that gave us the lead in long-distance telegraph cables that we maintain today.

The next phase is a development similar to that which took place in so many countries, including this one, on the inland side, too. From 1902 onwards, Governments of the Commonwealth themselves began to enter the field of transoceanic telegraphs., In that year a cable across the Pacific was constructed at the joint cost of the Governments of Great Britain. Canada, Australia and New Zealand. This cable was operated by an administration known as the Pacific Cable Board under the joint ownership of the four Governments—an early and interesting example of Commonwealth collaboration and a telling forecast of the shape of things to come.

In 1919, the United Kingdom Post Office began to operate two cables, known as the Imperial cables, across the Atlantic, a region which the Eastern Telegraph Company had never entered and which other British companies had, for the most part, left to the Americans. In 1926 and 1927, the Post Office began to operate short-wave wireless services with Australia, Canada, India and South Africa. The competition of the Pacific and the Imperial cables had not greatly stirred the Eastern Telegraph Company; but the success of the wireless services from their inception caused great consternation. The company's profits, and indeed its whole existence, seemed to be seriously menaced, and strong representations were made to the Government of the day. In consequence an Imperial Wireless and Cable Conference was held in 1928.

The adoption of its recommendations inaugurated the third phase—a semipublic merger of all Commonwealth overseas communications. The services directly worked by Governments—the Pacific Cable Board, the Imperial Cables and the Beam Wireless—were all absorbed, and the operating combine took shape in the company later known as Cable and Wireless Limited. The Governments thus lost their direct control over a part of the Commonwealth system. But in return they gained an indirect control over the whole of the system operated by the combine.

A standing advisory committee was set up on which the Governments of the United Kingdom, Canada, Australia, South Africa and India were represented. It included a representative of the Colonies and Protectorates, and was later strengthened by the addition of a representative of Southern Rhodesia. This committee had an advisory function only; its advice was limited to questions of policy, and its terms of reference excluded the Commonwealth companies which operated the distant ends of the beam wireless services. In 1944 it became the Commonwealth Communications Council and was later strengthened by the addition of Lord Reith as an independent chairman—that is to say, a chairman not representing any one of the Commonwealth Governments.

Meanwhile, the operating combine set up in 1928 unfortunately did not justify the high hopes with which it was launched. Ten years later it was necessary to relieve Cable and Wireless Limited, as it was then called, of its liability to pay rent for the United Kingdom Government wireless stations which it was operating. In return for transferring the ownership of these stations to the company, the United Kingdom Government was assigned 2,600,000 £1 shares in the undertaking, about one-twelfth of its total capital. These arrangements were given legislative sanction by the Imperial Telegraphs Act of 1938.

Nevertheless, further difficulties arose, especially in meeting the changed conditions created by the war, and in 1944 the Commonwealth Communications Council, the advisory body which I have already mentioned, proposed that the system should be nationalised by establishing a series of public corporations in the United Kingdom and in the other Commonwealth countries concerned. Each corporation was to be owned by the local government, but linked with the remainder by an exchange of shareholding. Later in the same year, Lord Reith, at the request of the Coalition Government, undertook a special mission round the Commonwealth, and he, too, recommended nationalisation, but on a somewhat different basis. Under this, while private shareholding would be wholly abolished, each partner Government would acquire the assets of the Cable and Wireless Limited in its own territory, as well as the communication assets of its own local company.

A conference of Commonwealth governments, therefore, took place in London in July, 1945, to discuss these proposals and other matters. The recommendations of this Commonwealth Telecommunications Conference were approved by all the participating governments. It accepted the suggestion made by Lord Reith for the nationalisation of the Commonwealth telecommunications system, and recommended that, when this process was sufficiently advanced, the Commonwealth Communications Council should be developed into a Commonwealth Tele- communications Board. Since 1945, therefore, the function of the Commonwealth Communications Council has become more important, and it has been advising Commonwealth governments on all aspects of Commonwealth telecommunications, with a special reference to the co-ordination of cable with wireless services.

So begins the fourth phase, the phase of government ownership. The foundation stone of the new Commonwealth partnership was laid in the United Kingdom when the Cable and Wireless Act was passed in 1946. This brought the remainder of the share capital of Cable and Wireless Limited into the ownership of the United Kingdom Government. Besides the United Kingdom, Australia, New Zealand, South Africa and India have now already nationalised their external telecommunications services and together with Canada, Southern Rhodesia and Ceylon are already members of the Commonwealth Communications Council. Pakistan sends an observer to the council meetings and is considering whether to become a member. The stage is thus now set for the final step in the process and all the Commonwealth governments which are members of the council desire that the Commonwealth Telecommunications Board should now be set up. The detailed arrangements for this Board have, in fact, already been discussed by the partner governments, and were agreed upon on 11th May, 1948, in the Commonwealth Telegraphs Agreement. This agreement, which is the one mentioned in the Recitals to the Bill, has now been presented to Parliament as a Command Paper (7582).

This brings us up to the present time and to the Bill itself. It is the Bill's primary aim to give effect to the Commonwealth Telegraphs Agreement of 1948 so far as the United Kingdom is concerned, and in particular to set up the representative central body of the partnership—the Commonwealth Telecommunications Board. A further aim of the Bill is to transfer to the Post Office all the assets in this country of Cable and Wireless Limited except such assets as can conveniently be transferred without specific provision in this Bill. As regards the assets of Cable and Wireless Limited overseas, hon. Members will recall that when the proposed reorganisation of the company was announced in 1947, it was made clear that Cable and Wireless Limited would remain as a company to operate its overseas services and no change in the operation of these services by the Government is contemplated or involved in the present Bill. Lastly the Bill aims at extending the Postmaster-General's power to make pooling arrangements with regard to the revenue from external telecommunications.

Before I go on to discuss the individual Clauses of the Bill, I should like, with the House's permission, to say a little more about the proposal to make the Post Office the "National Body" within the United Kingdom, that is to transfer to it the assets and operating functions, in this country, of Cable and Wireless Limited. This proposal will already be known to the House from the statement which my right hon. Friend the Chancellor of the Duchy of Lancaster made in the House on 27th February, 1947. I should explain that when the Commonwealth governments agreed to acquire the assets of Cable and Wireless Limited and of the local companies within their respective territories, they naturally left open the question of the form in which each government should work them. It is clearly a matter in which uniformity is not essential. In fact, while South Africa and New Zealand have already allotted the new responsibility to their respective postal and telegraph departments, Australia and India have set up government-owned public bodies under general government control. Canada has not yet announced what form of public ownership she will adopt, although I understand that legislation will be introduced there during the current session.

As regards the United Kingdom, I may perhaps quote the right hon. Member for Aldershot (Mr. Lyttelton), who spoke for the Opposition during the Second Reading of the Cable and Wireless Act of 1946. He used the following words: I hope if they [the Government] do buy the assets that they will manage them through the Post Office because I think it will be cheaper."—[OFFICIAL REPORT, 21st May, 1946; Vol. 423, c. 222.] We certainly are in agreement on this point. The Post Office in the past operated the Imperial cables and Beam wireless; at present it is operating telegraph and telephone services, both by wireless and cable, to a large number of European countries, and wireless tele- phone services to every continent; and it is, in our view, obviously the body to handle the rest of the overseas telecommunications business in this country.

So we come to the details of the Bill itself. It is, in the first place, distinguished by having a lengthy series of Recitals, rather a rarity. I think, in these days. The first four of these Recitals give the more recent historical background of which I have already spoken. The remainder introduce specific matters dealt with in the Clauses of the Bill. Clause 1 of the Bill establishes the Commonwealth Telecommunications Board, and thereby confirms the tradition of Commonwealth co-operation in telecommunications and puts it on a firmer basis than ever before. Part I of the First Schedule to the Bill, which is a copy of the second schedule of the Commonwealth Telegraphs Agreement, sets out the constitution of the Commonwealth Telecommunications Board. Part II of the Second Schedule defines the term "national body" in such a way as to cover whatever form of organisation a particular partner government may set up within the terms of the agreement; in the United Kingdom, the national body will be the Post Office.

The object of the second Clause is to keep the Commonwealth machinery adaptable to changing views and changing circumstances. It gives me power, subject to the rights of Parliament, to modify the First Schedule—that is, the organisation of the Commonwealth Telecommunications Board—if and when such modification is desired by all the partner Governments. Clause 3 authorises me to pay this country's share of the Board's expenses. By Clause 4, subject to an intended agreement with Cable and Wireless Limited—whom, for the sake of brevity I will call "the company"—the company's land and assets in Great Britain, with a few exceptions which are principally used by establishments engaged in operations overseas, will vest in the Postmaster-General in April, 1950. Clause 5 provides the financial powers for the acquisition of the company's property in this country by the Post Office.

Clauses 6, 7 and 8 deal very fully with the pension rights and compensation of the company's staff. This is an aspect of the Bill which looks rather involved, and perhaps I may explain it a little. The total staff employed by the company is nearly 13,000, and of these nearly 5,000 are serving in this country. As I have reminded hon. Members, the company will remain responsible for the staff and services in the Colonies and in foreign countries, and it will, of course, for this purpose, have to retain in this country the necessary secretarial, accounting, inspectorial and other staff, but the large majority of its 5,000 employees in this country will be taken over by the Post Office, together with the work they are at present doing.

The transfer of this staff does not, of itself, need to be specially provided for in the Bill; the Post Office can take them over and settle their terms of employment in consultation with their representatives. Statutory provision is required, however, for dealing with pension rights, and Clause 6 enables regulations to be made for this purpose. This Clause contains provisions on lines which are familiar to the House, although it is rather more detailed than usual because we have full information about the existing pension schemes of the company. These schemes are identified in subsection (8) of the Clause. The question of pensions is rather complicated, because we have to consider the interests not only of the staff who will be transferred to the Post Office, but also of staff who will remain with the company in this country, in the Colonies and in foreign countries, and of staff who will be transferred to the service of the Commonwealth National Bodies. The total number of staff in the various pension schemes is about 7,000, of whom some 3,750 are serving in this country.

Clause 7 provides for the making of regulations for the payment of compensation to individuals who may be displaced or who, on transfer to the Civil Service, may suffer diminution of emoluments or pension rights. I think that this provision about payment of compensation is, perhaps, a matter more of academic than practical importance, because, as I have already said, the Post Office will be taking over the transferred United Kingdom staff along with the services which they are performing, and the possibility of any staff being displaced is rather remote. Clause 7, which again follows lines which hon. Members will have already met in other Acts, is, therefore, more in the nature of a safeguard for the interests of the staff than anything else.

I may mention that in connection with Clauses 6 and 7 we have consulted the Association of Scientific Workers and the Union of Shop, Distributive and Allied Workers, the two trade unions representing the large majority of the staff of Cable and Wireless Limited. I should like to take this opportunity of thanking their representatives for their close co-operation with the Post Office. We have also consulted the staff associations representing the Post Office staff, who have an obvious interest in the question of integrating the transferred staff with the existing staff of the Post Office. A comparatively small number of the staff of Cable and Wireless Limited are members of the Amalgamated Engineering Union, the Transport and General Workers Union and the Electrical Trades Union, and we have been in consultation with representatives of these unions also.

When we draft the regulations under Clauses 6 and 7 we shall invite the representatives of the unions concerned to further discussions. There will be a good many details to be settled because, as hon. Members know, these questions of pensions and compensation are complex and technical. I feel sure that these further discussions, if pursued in the same spirit of helpful co-operation as has marked those which have already taken place, will lead to mutual agreement and satisfaction. Clause 8 of the Bill is in common form, and provides for payment to referees who may be appointed for the purposes of Clauses 6 and 7 and for payment to persons giving evidence.

Clause 9 gives me authority to introduce a new revenue pooling scheme with the company. This, as mentioned in the sixth and seventh Recitals, is actually an extension of the existing arrangement, and is designed to avoid harmful competition between the cable and wireless services of the United Kingdom by removing all financial inducement to the Post Office or the company to use one method rather than the other; it leaves the whole system to be administered as one unit in the best interests of telegraph users. In this connection I should explain that in order to secure the advantages of full integration of the United Kingdom services with all parts of the world— both by telegraph and telephone—which the passage of the Bill into law will make possible—I propose to set up within the administrative department of the Post Office responsible for the external telecommunication services of this country, an External Telecommunications Board, on which the company will be fully represented. Co-ordination with the other countries of the Commonwealth will be ensured by the representation of the United Kingdom on the Commonwealth Telecommunications Board.

I do not think that this Measure, which completes a process, or even, I may say an evolution, which has been going on for so many years, can be regarded in any sense as controversial. It gives effect to an agreement between Commonwealth countries which by its very nature must transcend party differences. As regards the part of it which regulates the future spheres of responsibility of the company and the Post Office, I do not think I need remind hon. Members that we are not here effecting the nationalisation of the industry. The company was nationalised in 1946 We are now dealing solely with questions of management and machinery, and I believe that the arrangements proposed within the framework of the agreement with the other Governments of the Commonwealth, will make for economy and efficiency.

It is, after all, the Commonwealth aspect of this Bill which is of by far the greatest importance. I specially like the phrase "partner governments" which recurs in the Bill, and I would indeed claim that the history of wireless and cables is a fine example of continuous and close Commonwealth co-operation. By passing this Bill into law the House will be giving its sanction and recognition to a collaborative Commonwealth achievement; and it will be pointing the way, I feel confident, to similar achievements in other spheres in the future.

4.18 p.m.

Mr. Grimston (Westbury)

It has become the custom in this House for Ministers to read their speeches when introducing Bills. I should like to congratulate the Postmaster-General on having done it rather better than one of his predecessors who, upon arriving at that Box on one occasion, read the first sentence of his brief, which was, "It is thought that the Minister might usefully take this line." This Bill has been presented, as the Postmaster-General has said, to give effect to the agreement which has been entered into with the partner governments—like the Postmaster-General, I like that phrase—and that being the case, of course we shall not oppose it. At the same time, I have a number of comments to make and a number of questions to ask.

My first question relates to Clause 4 and the transfer of a substantial portion of nationalised Cable and Wireless to the Post Office. If the House will look at the White Paper, command 7582. page 4, paragraph 5, they will see the means under which the assets are to be acquired, and they will see, as the Postmaster-General has already said, that the national body can be either a Government Department or a nationally owned corporation. There is no necessity, of course, in implementing this agreement to make the Post Office the national body in the United Kingdom. That, I think, is agreed. It is a choice, as we would say on this side, between two evils, and here I think that I must refer to what my right hon. Friend the Member for Aldershot (Mr. Lyttelton) has said, as he has already been quoted. The right hon. Gentleman quoted what my right hon. Friend said during the passage of the Cable and Wireless Bill, but he did not carry the quotation so far as I am going to carry it. It is true that my right hon. Friend said: I hope if they do buy the assets that they will manage them through the Post Office because I think it will be cheaper. He went on to say: I do not think public ownership is going to make the company more efficient, but I rather deprecate the setting up of more and more public boards, however agreeable they may be to Government supporters, and to others, through the directorships and so forth that are going round. … He also said: … if the Government have the courage of their convictions, and have talked themselves into the feeling that the Post Office is highly efficient, they had better follow it through, and let the Post Office take the whole thing over and make the usual loss which this type of State enterprise will certainly make." —[OFFICIAL REPORT, 21st May, 1946; Vol. 423, c. 222.] The right hon. Gentleman has quoted my right hon. Friend in support of this recommendation, but I think that it is right that the House should be reminded of the qualifications and the reasons which he adduced when he made that recommendation.

I have one or two questions to ask on Clause 4. The first words are: If an agreement is entered into between the Postmaster-General and the operating company for the purchase, on the first day of April, nineteen hundred and fifty … I should like to know the precise significance of that date. The word "if" here seems to me to postulate that agreement may not be reached between the Government and Cable and Wireless. I presume then that Cable and Wireless would remain the national body. As I have said, there are advantages and disadvantages in making the Post Office the national body, and it may well be that the balance of advantage lies in handing over the United Kingdom activities of nationalised Cable and Wireless to the Post Office, leaving, of course, the foreign activities, where extra-territorial rights may be involved, in the hands of nationalised Cable and Wireless.

This brings up some questions concerning the staff, on which I want to say a word or two. The position will be that the staff of Cable and Wireless will, willy-nilly, become employees of the Post Office. Let us see what has happened to the staff since Cable and Wireless was nationalised. It is true that in the period between the nationalisation of Cable and Wireless and now the basic salaries have been increased, but the staff in the United Kingdom are in the aggregate receiving considerably less; moreover, nationalised Cable and Wireless has maintained its revenue, so the staff in fact, under the change from the old Cable and Wireless to the nationalised company, have become worse off.

It appears to be the policy of nationalised Cable and Wireless to align pay and conditions to the General Post Office to the detriment of the staff. The pay and conditions under the old Cable and Wireless company were better than those of the Post Office. It may very well be awkward for a Postmaster-General in future, after the Post Office has taken over Cable and Wireless, to have men working side by side who may be on different rates of pay. I would say that the higher pay is a legacy of the private enterprise of the past, and it is mani- festly unfair to transfer men from a private company to a similar job in a national company and in the process deprive them of emoluments or loss of pension rights.

The line which I am taking is that the employees in the private company should not have their emoluments reduced. Let us see what the Bill does in this respect. On looking at Clause 6 it appears to me that the pension position is secure. On page 6, line 35, are the words: … the regulations shall be so framed as to secure that persons having pension rights under the scheme are not placed in a worse position by reason of the amendment, repeal, revocation … That position appears to be safeguarded. In subsection (4), if there is a dispute about the regulations as to whether they fulfil this provision, the dispute must be referred by the Postmaster-General to a referee or referees appointed in England with the concurrence of the Lord Chancellor, and in Scotland with the concurrence of the Lord President of the Court of Session. The point is that if there is a dispute the Postmaster-General has no option; he has to refer the matter to an entirely independent body and accept their findings and introduce new regulations.

When we come to Clause 7 the position is not the same. Clause 7 gives no security to transferred persons that they shall not lose by the transfer. In order to make the position quite clear, I must quote from the Clause. I shall not quote every word, as it is rather long, but I do not think that I shall mislead the House if I quote certain words which give the sense of the Clause. Subsection (1) States: The Postmaster-General shall have power, exercisable by statutory instrument … to make … regulations providing for the payment by him out of moneys provided by Parliament, in such cases and to such extent as may be specified in the regulations, of compensation to persons who, on such date before the passing of this Act as may be specified in the regulations, were employed whole time as officers or servants of the operating company being—

1. (a) persons who suffer loss of employment. … or
2. (b) persons who suffer diminution of emoluments or pension rights in consequence of their entering the Civil Service of the State as the result of effect being given as aforesaid to that Clause; and any such regulations may make different provision. …

The whole emphasis here is that these powers are purely permissive and not mandatory on the Postmaster-General, and it is entirely left to his discretion as to whether he will give compensation or assessment for loss of emoluments or whether he will continue the emoluments at the level at which they were when the Post Office takes over the members of the staff. This Clause will certainly have to be looked at again. There is provision here also for an appeal of a sort, but only in this way the regulations for compensation may make provision for an appeal. By Clause 7 (2, b) it is merely left to the discretion of the Postmaster-General, in making regulations, to say whether he will give any rights of appeal or not. This Clause must be looked at again.

I should like the Postmaster-General to tell us why he takes what amounts to an option to reduce, without compensation and without appeal, the emoluments of this staff whom he is to take over. I think that this Clause ought to be made mandatory. Parliament should see that these people who are being compulsorily taken over are not made worse off in respect of their conditions. As the Clause stands it is purely optional. The only inference one can draw is that this staff shall be brought down to the scales operating in the Post Office.

I turn to Clause 1 and the First Schedule dealing with the Commonwealth Telecommunications Board and its functions. The Board has a number of functions. In respect of many of them they can do no more than make recommendations. There is one point to which I wish to draw attention. The First Schedule in page 14, line 15, provides: if the question to be decided is claimed by a member either before or at the meeting to be one of Governmental policy and unanimity cannot be obtained the Chairman shall refer the question to the Partner Governments together with his report and recommendations respecting the same and a decision on the question shall be suspended until the views of the Partner Governments have been ascertained. The point is that any member of the Board can veto a decision on a recommendation by saying that it is a matter of Government policy and must be referred to his Government. It is really a kind of veto similar to that which obtains at the United Nations. It seems to me that there might be considerable delay in settling important questions because of that pro- vision. A question might be shelved almost sine die because of this provision. I would like some explanation from the Postmaser-General for the reason for this provision and how it is intended to work. It seems to me to be a procedure of veto which might very well lead to an indefinite hold up on an important question. That cannot be in the interests of the telecommunications system.

Another specific matter about which I wish to inquire is the penny-a-word Press rate. Its introduction by Cable and Wireless was a bold and imaginative step. There is not the 'slightest doubt it has led to a big increase in the flow of public information throughout the Commonwealth. The penny-a-word Press rate is a matter of considerable concern. I ask the Postmaster-General whether he can give an assurance that this penny-a-word Press rate will be continued when the Post Office take over. I very much hope that he can give that assurance. It has been continued by the nationalised board, but there is some fear as to what its future may be under this new set up. It is in the general interests of Commonwealth communications and relationships and is a most important matter.

I have been speaking so far about the recommendations of the Board. I now turn to one of the positive functions of the Board. In the First Schedule, in the paragraph dealing with functions, page 13, line 16, sub-paragraph (5) states that one of the functions of the Board is To set up and administer a Central Fund for the receipt of the net revenues of the National Bodies. To obtain some details as to how this is to be administered we have again to turn to the White Paper. In passing, I do not see why the arrangements which are set out in the third schedule to the agreement are not included in the Schedule to the Bill.

The Assistant Postmaster-General (Mr. Hobson)

In the White Paper there is a protocol which refers to Clause 7 of the Third Schedule to the agreement, to which the hon. Member is now referring, which somewhat alters the position.

Mr. Grimston

I do not think that it alters the position in regard to this agreement—that which will obtain in the working of the fund. If everyone has not got the agreement, it would be as well if I read out the paragraph dealing with this account which the Commonwealth Telecommunications Board are to administer. I refer to paragraph 7, on page 12, which states: The Board shall open an account for the National Body in the Central Fund. The National Body shall pay to the Board an amount equal to the net revenues derived from the external communications services of the Government during any year and the Board shall credit the amount to the National Body's account. … For the purposes of this sub-clause the net revenues derived from the external telecommunication services of the "—

Mr. Hobson

I do not wish unduly to interrupt the hon. Member, but if he will refer to page 14 of the Agreement he will see that there is a Protocol which says that: The Agreement does not commit the Partner Governments to the terms or principles of the financial arrangements embodied in Clause 7 of the Third Schedule. … The position at the moment is fluid and has to be discussed.

Mr. Grimston

Then it is all the more important for me to draw attention to the point to which I am coming. We shall at all events assume that this pro forma will form the basis of the discussions as to what the agreement is to be. It is stated in page 13, and in sub-paragraph (b): The moneys paid into the Fund in respect of any year shall be applied (b) in meeting any deficiency in the net revenues derived from the external communication services of the United Kingdom during that year up to an amount not exceeding the cost to the United Kingdom National Body of cable maintenance and provision for cable renewals for that year. That appears to be some projected provision for a subvention for the upkeep of the cable network. The question which I wish to put is a little difficult. Perhaps I could frame it in this way. As the Postmaster-General said, with the advent of wireless it was feared that cables would lose money and would become uneconomic. Whether that is true today to the same extent I do not know. The development of the submarine repeater may and very' likely will mean that cables will have a fresh lease of life. But there was a time when it was thought that to keep up the cables would be an uneconomic proposition, and so far as we know that is still the position. That being so, and the cables being a network of great strategic importance to the Commonwealth as a whole, as was certainly exemplified during the war—because messages can be kept more or less secret over a cable system but not over the wireless—it was felt not unreasonable that the members of the Commonwealth should bear some part of the loss in maintaining that cables network if the ordinary traffic did not support it.

From this projected agreement it would seem that any provision for a subvention will be dependent upon the Postmaster-General making a loss. If he shows a loss on his combined operations on cables and wireless he may get some contribution from the Commonwealth Telecommunications Board for the upkeep of the cables; but so long as he makes ends meet he will get none. That is the position which appears to arise within the agreement set out in the third schedule to the White Paper. The Assistant Postmaster-General has, of course, drawn my attention to the protocol, and these agreements may not be embodied in quite this form. But when there are discussions on what form they are to take I hope that there will be an agreement to ensure that the cost of maintaining the cables is pooled throughout the Commonwealth, and that the United Kingdom shall receive some assistance towards the cost and shall not have to bear the whole cost of maintaining the strategic cables system of the Commonwealth.

I hope that whoever replies will be able to satisfy us upon some of these points. I must say, in conclusion, that the Bill certainly gives effect to the agreement for the future set-up of the Commonwealth telecommunications service. We see in the process the disintegration of Cable and Wireless Limited. First of all we had the removal of the assets held by Cable and Wireless Limited in the Dominions, and we now see the removal of the assets left to them in the United Kingdom, and there are to be left, so to speak, suspended oceanic cables, the relay stations, and the stations in foreign territory. Its dismembered portions, and all the others, are to be overlooked by the Commonwealth Telecommunications Board, whose powers are very largely advisory.

I cannot think that this arrangement will be conducive to speedy decisions which may sometimes, and indeed perhaps often, be necessary in the interests of Commonwealth communications, particularly when we are faced with foreign competition. However, the matter has had a very long history which cannot be left out of account, and this new experiment represents the agreement of the partner governments in the light of that history. Let us hope that it will work, and that it will be conducive to the advance, maintenance and improvement of Commonwealth communications, which are the lifeblood of the Commonwealth.

4.44 p.m.

Mr. Skinnard (Harrow, East)

I begin by echoing the concluding words of the hon. Member for Westbury (Mr. Grimston), that this Bill, and similar Bills which have been or are to be introduced by some of the partner nations of the British Commonwealth, will fulfil what is known to be a long-felt want, that it will bring a closer co-ordination of telecommunications within the Commonwealth and promote a greater unity of design. Unlike the hon. Member for Westbury, I have not quite so much misgiving about the outcome of the discussions on the new Commonwealth Telecommunications Board, because, as has been shown by the Postmaster-General, the history of telecommunications between the various parts of the Commonwealth has been a very long one and has been of slow evolution, and on the whole there has been a remarkable feeling of partnership and amity in the development of the facilities.

I shall not, therefore, do more than congratulate my right hon. Friend on his careful analysis of the present position, on his review of the history of Commonwealth telecommunications, and on his detailed presentation of the Bill. I should, however, like to draw attention to what I consider to be an injustice which might be righted during the passage of this Bill through this House, or in another place. The hon. Member for Westbury expressed concern that the present employees of Cable and Wireless, Limited, should not have their prospects or their emoluments lessened on entering the service of the Post Office. As a matter of fact, I believe that their wishes and interests are being and have been largely met by negotiation. As we have seen, pension rights have been fairly closely safeguarded in one of the Clauses.

I would remind the hon. Member for Westbury of an interjection on a previous occasion by my hon. Friend the Member for East Woolwich (Mr. Hicks) who suggested, in my opinion quite rightly, that he would not be content to see a state of affairs in which people doing comparable work, and possessing similar qualifications, have different rates of pay and different conditions of service. I am afraid that is likely to happen if something is not done in Committee about a very small class of people now in the Post Office service. After 1928, when the first Imperial Telegraphs Act was passed and beam wireless transferred, there was no further recruitment to the cable room of the Post Office until 1947, so that the promotion prospects of the men remaining in that department of the Post Office were reduced to almost nil. The number of men was not considerable, and in the course of time naturally tended to decrease still further; and I believe I am correct in saying that there are no more than 141 persons who are still affected by the decision taken on the transfer in 1929.

I think the Postmaster-General will agree that, when the circular inviting applications to transfer to this particular branch of the Post Office service was issued, a good many of those who volunteered were of the highest calibre, attracted by the realisation that they would become associated in a new era in telegraphy, and because of their keenness some of them sacrificed seniority in other departments in order to begin in the new venture. I am informed that many of them in their spare time took courses of studies to gain qualifications suitable for their new work—languages and technical examinations, for example. That not only showed their keenness but added to their potential value to the Post Office.

When beam wireless services were transferred, a promise was given by the then Postmaster-General that those who remained in the cable room, the members of the existing staff, would not suffer loss as a result. It all depends on the defini- tion of "loss" whether we judge that they have suffered a loss or have been compensated. One of the first results of the change was the closing down of recruitment. There was a natural loss of the promotion prospects they might have enjoyed had the status quo been maintained.

I submit that in spirit, if not in the letter, the pledge of the Postmaster-General of that time has not been honoured. A new scale of pay has been instituted for those members of the Cable and Wireless staff who were in the service of the company before 1939—I believe that is the date which was fixed. This scale of salaries has been offered, quite rightly, and I am not grumbling at it, because of a guarantee given by the Chancellor of the Exchequer who preceded the present holder of that office that these people should not suffer loss of emolument on entering the service of the Post Office, or that compensation should be offered in case of displacement or the acceptance of a lesser post. I believe I am right in saying—and I hope the Postmaster-General will be able to confirm this—that the salaries of operators were then consolidated at £585 per annum. I should like to contrast that with the present maximum salary of the old employees who remained in the cable room after 1929. These operators, who in many cases have comparable experience and equivalent qualifications, have a maximum salary of only £421 12s. 6d.

It may be said that this is a very small point, but very often it is the pain in a very small joint which makes the whole body feel pretty miserable. We do not want the justice that has been shown to the new staff who are being incorporated to act as an injustice in the case of these servants of the Post Office who have been left with very little prospects of promotion as a result of the changes that have been brought about. We do not want to leave them with a sense of frustration brought about by seeing people from outside being given a salary £160 above their own. I think I am correct in saying that only 141 are concerned, but I ask my right hon. Friend whether there is not some way, during the passage of this Bill, to avoid this injustice which would seem to reflect on the old and faithful servants of his Department.

Finally, on the Bill as a whole, I have no misgivings that it will be unworkable or that there will be unnecessary delays. I have seen in other fields affecting the Commonwealth how remarkably quickly "red tape" is forgotten and representatives of the Commonwealth get together to solve a problem. This is a fine example of legislative co-operation for a common objective to serve the Commonwealth as a whole. What we are doing today will be of great service not only to the people of this country but to our fellow citizens throughout the world.

4.57 p.m.

Sir Ralph Glyn (Abingdon)

There is a point of detail I should like to raise with the Assistant Postmaster-General. It is in regard to the position of the officers and crews of the cable ships. That has not been mentioned today. It is obvious that under the old organisation the future of these men was more assured in some ways than probably it will be under the new organisation. Presumably the partner governments will have to provide cable ships competent to do the necessary work within their own regions. It was not clear from the right hon. Gentleman's speech what is to be the share of the partner governments in matters of this kind. These vessels operated throughout the world under the old organisation, and possibly they will continue to do so on some payment basis. We must think of these men, their homes and families, and it is most important that these servants of the old company should have their position made clear.

There is another matter on which 1 hope to have some guidance, and that is the position of the new board in regard to the Colonies. Those who comprise the board are representing the Dominions, and it may be that the Government, in consultation with the Colonial Office, will take responsibility for communications with the Colonial Empire. We ought to have it made clear what will be the link, because it is of the utmost importance that the Colonies should be in this scheme in some shape or form. There is also the question of the position of the new Republic of Eire. There are important cable stations in that country which form an essential link and which are obviously not represented on the board. I had something to do with cable control at the beginning of the 1914–18 war. It was very necessary to see that the safety of cable communications was assured, and the position of Valencia and similar places caused us considerable anxiety.

As my hon. Friend the Member for Westbury said just now, the arrival of wireless has speeded communications and cheapened rates, but in war-time it is not as useful as the cable. I now understand that the efforts of the Dollis Hill staff, who are always to the front in these matters, have enabled this submarine booster or repeater to increase cable traffic in a most astonishing manner. Therefore, I imagine that among the functions of the Telecommunications Board will be the preservation of the safety of the cables to ensure that they are not tapped by submarines. It is probably known to the House that experiments were recently made by a certain country to find out whether it is possible to make contact with the cable under the water at such points where the cables come near to land. Of course, it would be extremely embarrassing and annoying if one assumed that the cable communication was intact while all the time submarines had been tapping it beneath the surface of the water. I imagine that there are some means of finding out whether there is any such interference taking place, but this is a matter which should be considered with great care.

I want to know whether it is proposed under this Bill to implement the recommendations of no fewer than four Cabinet Committees that were appointed. The first of these was in 1933 when the Colonial Secretary was Sir Philip Cunliffe-Lister. The second Committee was when the late Mr. Thomas was Colonial Secretary; there was another report in July, 1936, bearing on this matter of linking up between wireless communication and the necessary transmitting stations, as well as the necessity to increase broadcasting throughout the Colonial Empire.

The cost of the scheme has been mentioned, and it amounts to a very large sum of money—something between £15 million and £16 million. The cost would be lightened considerably if some of the recommendations of the 1936 Committee could be adopted and ordinary commercial traffic could be sent at special rates through the network of the normal broadcasting transmitting stations, which at other times of the day would be engaged in broadcasting, either on the short waves or otherwise, to different parts of the Colonial Empire.

I understand that a committee at the Colonial Office has been sitting through the last few weeks and that a report has been made to the Government on the future of broadcasting throughout the Colonial Empire. I do not think the House knows what are the recommendations of that committee, but if it involves, as we must assume it does, the erection of very high-powered transmitting stations, would it not be possible to reduce the cost of the necessary work for broadcasting by making some arrangement as was suggested in 1936, and between certain hours of the day utilising those transmitting stations for ordinary commercial purposes? I can find no mention of whether the Postmaster-General is now going to take over the whole of the broadcasting services for which Cable and Wireless are responsible in various individual Colonies. For instance, in Kenya, Cable and Wireless are responsible for local broadcasting. Will that be the responsibility of the Postmaster-General, or will it be done by the B.B.C., or who will do it? Surely there should be some mention in one of these documents of such functions as those. If the Postmaster-General could tell us what is to happen, the House would be interested.

In addition, who will be responsible in the various defensive regions into which the world is now apparently divided, and when we have the various Dominions responsible for defence? As the right hon. Gentleman very rightly said, one of the main functions of the Board is the coordination of the appropriate authorities responsible for communications in matters of defence affecting the British Commonwealth or any part thereof. If there is no link between the Governments of the Colonies, how can that function be carried out? It is quite obvious that what affects communications, for instance in the African Colonies, is very germane to the interests of Southern Rhodesia and the Union of South Africa. There must surely be some body set up that will make the necessary arrangements so that the two things can be brought into proper perspective.

I notice that the Postmaster-General in his opening speech said that he proposed to set up an External Communications Board. Is that Board, which is a sort of subsidiary of the main Commonwealth Telecommunications Board, going to deal with matters in the British Colonies? What will be its functions? I understood the Postmaster-General to say that he hoped to set up this body, but I did not quite gather what it was going to do, unless it was going to work with the Colonial Office and deal with these very important matters.

I should like to say a few words about the transferred staff. The old Eastern Telegraphic company, which I remember in its very early days, used to have very admirable arrangements for the education of children of men serving in stations in rather isolated positions. I think the Postmaster-General realises that although air communication makes conditions better in this respect, the majority of men who serve in those outstations are necessarily young men. They want to get married, and in some cases it is quite impossible to provide married quarters owing to the climatic conditions. In other cases, with modern arrangements for refrigeration and so forth, much might be done to accommodate the families of such people who have to be in these outstations. I do beg the right hon. Gentleman to consider the arrangements which were made by the Eastern Telegraphic company to provide facilities such as the education of the children of their employees, and I trust that he will not permit service in these outstations to be extended over too long a period.

With the transfer of so many men under the present scheme, I assume that they will come under the Superannuation Bill for civil servants which was discussed in this House last week. If so, on what terms are they covered? While I agree with hon. Members opposite and with my hon. Friend the Member for Westbury (Mr. Grimston) that it is a very bad thing to have two men doing the same work for varying rates of pay, there may be advantages if they come in under the new Superannuation Bill which was recently introduced to the House. If they do so, those terms ought to be clearly stated, because there is already a contri- butory pensions scheme in Cable and Wireless, and those who have contributed to it should not suffer by being transferred.

Mr. Scollan

Would not the hon. Gentleman agree that there should be some increase in remuneration for long service, even though two men are doing the same job?

Sir R. Glyn

Yes, obviously that ought to be so. All I am saying is that while I think it is undesirable that two men should be doing the same job for different rates of pay where conditions are presumably the same, there are certain matters of compensation which should be taken into account if the pension which they will eventually obtain will be greatly to their advantage. It is of vital importance that the Postmaster-General should make sure that any contributions made to the Cable and Wireless pensions scheme should redound to the credit of these men who have already contributed. I do not think that that matter has been made clear. It is of great importance during a transition period that people who contributed to one pensions scheme should, if they wish, continue on those terms in another, and that the Government should guarantee what they should be paid. People should not be damnified as a result of being transferred to Government service. I trust the Bill will come into operation as quickly as possible, because I agree with my hon. Friend the Member for Westbury that there are certain provisions in it which may lead to extreme delay. In communications anything which tends to delay is obviously bad for those communications.

5.11 p.m.

Mr. William Shepherd (Bucklow)

We have listened to such a pleasant flow of praise today that I do not wish to strike a discordant note, although I think the Postmaster-General has had a far from easy time. He treated the House to a historical survey of the development of telecommunications, which his Department no doubt thought would not cause much offence or concern in any part of the House. In that, their judgment was right, but I should like to take up one point, namely, that he did not pay sufficient tribute to the pioneers of telecommunications. Had it not been for the pioneers, the Eastern Telegraph Com- pany, the position we occupy in this field today would not be ours. It was not due to any amalgamation of boards or Government organisations that we achieved supremacy in this field.

Mr. W. R. Williams (Heston and Isleworth)

Would the hon. Gentleman also tell us about the early pioneers in the Post Office whose work on beam services made Cable and Wireless possible?

Mr. Shepherd

I am not attempting to say that the Post Office have made no developments, because I think we all have great admiration for Post Office engineers. I am glad that the Postmaster-General has done something recently to improve their wages. On the whole, I believe that Post Office engineers are grossly underpaid. One finds that even the men who fit telephones take a great interest in their work, are anxious to do it properly, and have not had the deal from the Post Office that they ought to have had.

I was dealing, however, with our supremacy in this field, which came about as a result of the activities of the early pioneers who have now been cast aside for a Government board. I have no admiration at all for a Government board; I do not think it will provide us with a more efficient service than we have had hitherto. Indeed, if the Minister had endeavoured to constitute a board more cumbersome than this telecommunications Board, I believe he would have had some difficulty. How the hon. Member for East Harrow (Mr. Skinnard) stretches his imagination to a point where he can visualise lightning decisions by this authority I do not know. How he visualises "red tape" being stripped away by this dynamic organisation passes the comprehension of my simple mind. I hope he is right, but I have grave misgivings. We have had a rather devastating experience of the control of this organisation by a public company. Already, we have seen the profits of Cable and Wireless halved in one year's operations. I know that excuses are put forward about increasing costs of maintenance and everything else—

Mr. Hobson

The hon. Member will appreciate that the revenue of the company was swollen during the war because of the war.

Mr. Shepherd

I appreciate that although the profit went down by £1,750,000 the revenue went down by only £500,000. That casts a poor reflection on the activities of the company for 1947. I am not at all satisfied that the proposed change will be for the good, particularly as what we gain in terms of profit from this company is largely obtained from overseas. Revenue from overseas is very vital to this country at present; indeed, we sink or swim by our overseas revenue. So far as I can see, the intention of the proposed set-up is to reduce the amount of revenue we are likely to get from overseas. On purely economic grounds that cannot commend itself to anybody today.

I sometimes wonder whether there has been any real enthusiasm for this idea among the Dominions, such as the Postmaster-General would have us believe. It is true that he sent round a couple of Marco Polos to induce people to subscribe to this idea, and I wonder whether the intervention of these gentlemen is not really responsible for the alleged enthusiasm for the scheme. Whether or not enthusiasm does exist, the net effect will be to reduce the revenue which will accrue to this country. That is not a very wise or proper choice.

I want now to deal with the transfer of staff to the Post Office. Cable and Wireless employees have had a hectic time during the past year or so. They went from the wicked private enterprise operators to a public corporation, and are now being switched back to the Post Office. There is no doubt that these lightning changes have caused a great deal of misgiving. I do not share the views of the hon. Member for East Harrow, who said that he did not know what would happen. He should have no doubt at all. Those who were employed by Cable and Wireless will have their wages reduced when they join the Post Office. Nationalisation means lower wages for the workers. [HON. MEMBERS: "No."] If hon. Members opposite want to deny that, they are at liberty to do so, but this has, in fact, happened. Is it not true that, calculating the bonus, the present servants of the nationalised company receive a lower rate of token remuneration than they did from the private company?

Mr. Scollan (Renfrew, Western)

It is not true.

Mr. Shepherd

The hon. Member does not know anything about it.

Mr. Scollan

It is the hon. Member himself who does not know what he is talking about. Have not wages in the nationalised coalmines and railways increased?

Mr. Shepherd

The hon. Gentleman's lack of capacity to grasp a simple point always astounds me. I was talking about Cable and Wireless—

Mr. Scollan

The hon. Gentleman said "nationalisation"

Mr. Shepherd

I was saying that, calculating the bonus which was paid to employees by the private company, the employees are now receiving lower remuneration than they were when Cable and Wireless was privately owned. This is not a suggestion; it is a reality.

Mr. Skinnard

Would not the hon. Gentleman agree that the high rates of pay deservedly earned by Cable and Wireless employees were not due to private enterprise so much as the fact that there was a heavy subsidy by the State?

Mr. Shepherd

No, I would not agree at all. Although there was a State subsidy the high wages were due to the enterprise shown by the company. Now they are to be relegated to State employment. The Post Office is regarded as a means of revenue. If its classic function is to provide a bouncing baby for the Chancellor every year, then there is little chance of those employees getting the wages for which they are justified in asking. Therefore, I say that these men, when they ultimately come into the service of the Post Office, have the chance of a lower remuneration than ever before.

My concern is fortified by the efforts which I made, quite abortively, during the passage of the Cable and Wireless Bill, to get from the Financial Secretary to the Treasury some guarantee on behalf of the employees. The right hon. Gentleman would give no guarantee that these men would not suffer loss as a consequence of the transfer. Anybody who reads Clause 7 will see that no undertaking is given to the men that they will suffer no loss, or that, suffering loss, they will receive compensation. As far as I can see—and perhaps the Assistant Postmaster-General will correct me if I am wrong—it is possible for the Postmaster-General to allow the Bill to go through and for the transfer of the staff to take place and to make no regulations at all concerning compensation. I hope that hon. Members in all parts of the House will be firm about this matter with the Postmaster-General. The Bill affords no safeguard for the employees. I hope that no one will allow the Bill to go forward in its present form until words are inserted to see that these people who suffer are compensated for their loss in this direction.

I wish to conclude by saying that I view with very grave disquiet the tendency to put Cable and Wireless and tele-communications into one public corporation. It will mean that the ossification of the system has really begun. I do not think that any real good will come from it. It means that we shall lose overseas revenue and that the dynamic nature of our development in these communications will be materially lessened. It will mean that a great number of able employees of the company are to be put into a certain amount of jeopardy. I do not look upon the Bill as a progressive Measure at all, and I cannot share the enthusiasm for it of some hon. Members opposite.

5.22 p.m.

Mr. W. R. Williams (Heston and Isleworth)

I do not think hon. Members will expect me to follow the intricacies of the reactionary mind of the hon. Member for Bucklow (Mr. Shepherd). I think it is pretty well known in this House now that the word "nationalisation" has become anathema to the hon. Gentleman. The difficulty with the Tory Party and with hon. Gentlemen opposite is that they do not know exactly what they mean or where they stand on any of these matters. It is only a few weeks ago that the right hon. Member for Bromley (Mr. H. Macmillan) was telling people in the country that it is not the intention of the Tory Party, if they are ever in office again, to withdraw nationalisation of these services. Therefore, the only thing that one can deduce is that hon. Gentlemen opposite are either dishonest, which I would not like to suggest, or that in their own minds they are accepting nationalisation of the basic industries as having been a great success.

Hon. Members

No.

Mr. Beverley Baxter (Wood Green)

The hon. Gentleman is usually very fair, but I would point out that he is now behaving like a Socialist, rather than a proper Englishman. We have opposed practically every nationalisation Measure because we do not believe in them, but once they have been passed and nationalisation has been accomplished—I know this is political A.B.C. —we cannot sell the industries back to the owners again—[An HON. MEMBER:" You have done it before."] We have to find some method of running these unfortunate industries, but still under State ownership.

Mr. Williams

The hon. Member's difficulty is that he is saying the same thing about the nationalised and socialised basic services as his hon. and right hon. Friends have been saying about the National Health Service. The Tory Party are all in favour of every one of these services in the country, but they have been opposing them persistently in this House throughout the passage of the Bills. I do not see how they can have it all ways, and it is about time they made up their minds. Having said that about the hon. Member for Bucklow, and his attitude towards nationalisation, I am not going to quarrel with everything that he said. From my knowledge there is a grain of truth in what he said, but unfortunately for him, he does not know exactly where the grain of truth lies. Before we come to the Committee stage, I suggest that he might like to make a few more inquiries. It may be that he will come pretty close to the point which was put by my hon. Friend the Member for East Harrow (Mr. Skinnard).

I do not propose to discuss the Bill in detail. I hope in another connection to be able to deal with some aspects of the matters in the Bill. By and large there is an element of fairness in the conditions which the Postmaster-General and the Government have conceded in the Bill, and in the main, there is a great deal of justice meted out to the old employees of the old Cable and Wireless. In so far as members of the staff who were in the service before 1939 are con- cerned, the Bill represents a very fair measure of agreement. I should not like to say that if I had been in charge of the negotiations as a trade union negotiator I would have accepted the Bill as a good agreement, in so far as it concerns the people who have come into the service since 1939. That is a matter over which I have no control, and I have not a tremendous amount of direct interest in it. By and large, however, the agreement is pretty good.

My main purpose is to deal briefly with the points made by my hon. Friend the Member for East Harrow. It is true that the maximum paid to the staff of the cable room in the Post Office is a good deal below the figure which is to be paid to the staff of Cable and Wireless transferred to the Post Office under the Bill and who were in Cable and Wireless before 1939. I will not deal at great length with the arguments used by my hon. Friend, except to say that he is fundamentally correct in the information which he gave to the House. I believe that this matter will be dealt with in another way.

All I want to do now is to seek an assurance from my right hon. Friend the Postmaster-General, or from the Assistant Postmaster-General, that there is nothing in the Bill to preclude the integration of the Post Office staffs in the new overseas telecommunications set-up, on the same terms as the staff who are now employed by Cable and Wireless; that there is nothing to prevent arbitration in regard to that particular matter; and that there is nothing in the Bill which will prevent associations connected with the Post Office from taking arbitration proceedings. I do not wish to deal with the merits of the case, except to repeat that what my hon. Friend the Member for East Harrow said in regard to the position of the Post Office staff in the cable room is correct in practically every detail. I should like to get an assurance that there is no prejudice in this Bill to any future action in connection with the staff in the cable room.

5.30 p.m.

Mr. Beverley Baxter (Wood Green)

shall not detain the House long but I should like to say that, looking back, we now see that the nationalisation of Cable and Wireless Limited was a great mistake. It was a superbly organised cable company; it was the best in the world, and I remember the time when it achieved that extraordinary boon of one penny a word as a cable charge for the Press of the Empire. That was a thing that should have made the Government think twice before interfering with such management. I pay a great tribute to the work of Sir Edward Wilshaw, who fought against nationalisation from the beginning even though he knew he was fighting a losing battle. I only wish that other leaders of industry would take the brave outspoken attitude that he took. He paid for it. He was a man who had done much to build up that great company and he believed in his heart there was absolutely no reason at all for it to be taken over by the State. It was his view that it would eventually lose in efficiency and earning capacity. Perhaps we are seeing something of that result today.

Cable and Wireless, as a private concern, was able to maintain cable stations in foreign countries without involving diplomatic disputes or, what is more embarrassing, creating trouble in the case of war, when a country's neutrality might be impinged upon. The Government have not made a case for the nationalisation of Cable and Wireless, but I am glad that they have maintained the position of the staff. [Interruption.] I know that this is not a nationalisation Bill, but I rather relied upon Mr. Deputy-Speaker permitting me to put these points.

Mr. Deputy-Speaker (Mr. Bowles)

I think this Bill refers only to the Empire and puts into force an agreement which was already reached under the nationalisation Bill passed by this House.

Mr. Baxter

I thought, Mr. Deputy-Speaker, that you would call me to Order earlier, and I am grateful that you have allowed me to go so far.

There is only one other point that I want to make and that is in regard to the difference in pay between the Cable and Wireless employees and those in the Post Office. The speech of my hon. Friend the Member for Bucklow (Mr. Shepherd), which I thought was excellent, called the attention of Parliament to the fact that the Post Office is being used as a maker of profits for the Treasury, as a means of revenue for the State. When there is a monopoly there are, of course, profits. Even under Government control, a concern cannot lose money if it keeps increasing its charges until it makes money. Nobody can lose money in those circumstances, but I suggest that the profits from the Post Office services should be given to encourage the employees.

I believe that the pay of the technicians is too low. A deputation from these men met me and put their case to me. They showed me their weekly budget, and they compared their lot, taking their pensions and everything else into consideration, with employees similarly engaged under private enterprise. It is time that Government enterprises let their employees share in the fruits of their work, and the Post Office employees are feeling discouraged by the present conditions under which they work.

Mr. Scollan

Is this a recent conversion?

Mr. Baxter

On my part?

Mr. Scollan

Yes.

Mr. Baxter

I have always believed in high wages for hard work. As the Editor of the "Daily Express," I can state that we paid the highest wages in the country. Since this Bill is inevitable, I hope it works out well.

5.35 p.m.

The Assistant Postmaster-General (Mr. Hobson)

We have had a very interesting discussion this afternoon, and I am pleased that the Opposition are not going to divide against the Measure. It is true to say that there have not been any major criticisms—just a few gentle animadversions—and that is due in no small measure to the fact that my right hon. Friend in his speech traced the history of overseas telecommunications in Great Britain and pointed out the many vicissitudes through which they passed during the inter-war years.

It seems to be assumed, particularly by the hon. Member for Bucklow (Mr. Shepherd), that Cable and Wireless had always been a prosperous concern. That is far from being the truth. In the early days when the old company was a monopoly, it was very prosperous. Dividends were high and, let us say it in all fairness to the company, so were the wages. I only wish that every other private enterprise firm conducted its business on the same tenets. In 1926 and 1927, however, when the company was faced with competition, there was another story to tell, and immediately it got into rather serious difficulties.

In 1928 there was an Imperial Wireless and Cable Conference, and some public merger of Commonwealth overseas communications was made. In other words, Cable and Wireless was formed, and the Government lost direct control. In point of fact, the only control the Commonwealth or British Governments had was merely to say that certain cable routes could not be closed down. We come to 1938, which is 10 years after the setting up of Cable and Wireless. The company was relieved of the liability of paying rent for the wireless stations, and the Government were assigned 2,600,000 £1 shares, which was one-twelfth of the total capital.

Mr. W. Shepherd

The hon. Gentleman says the only control that the Government had was the power to prevent a cable route from being closed down. Has he told the House that a body was set up to ensure that the public interest was safeguarded in these matters?

Mr. Hobson

The Imperial Communications Advisory Committee was set up, but it was purely an advisory committee. There is no point in what the hon. Member is trying to make, because that Committee had no power to make a recommendation or to see that it was implemented. It was a purely negative form, and the hon. Member for Bucklow has obviously not understood the history of telecommunications.

Mr. Shepherd

I want to be fair to the hon. Gentleman and also to myself. This body never made any recommendation which Cable and Wireless refused to carry out.

Mr. Hobson

Without notice I could not answer that question, but, so far as the general policy goes, what I have said is a statement of fact. The Advisory Committee's control was of a purely negative character, and in practice only amounted to the fact that the Govern- ments could veto the closing down of a route.

In 1944 the Commonwealth Communications Council recommended nationalisation, and in 1945 the Commonwealth Telecommunications Conference recommended the acceptance of Lord Reith's proposals. Those are the proposals we are now discussing, namely, that the company remain and that their assets in Britain and the Dominions should be integrated in the national body of each country. As far as Great Britain is concerned, we have chosen to integrate them in the Post Office. The hon. Member for Westbury (Mr. Grimston) quoted the statement of his right hon. Friend the Member for Aldershot (Mr. Lyttelton) that it was a choice between two evils. That may be so, but the right hon. Member for Aldershot made his choice of one of the evils—that is how he saw it—and that evil was that the assets of Cable and Wireless in Britain should be integrated into the British Post Office. He did so for very sound and valid reasons, namely, that it would be more economical and more efficient. The right hon. Gentleman was logical in his conclusions, and I have no quarrel with him.

There is a general assumption that there has never been any criticism against Cable and Wireless. That is wrong. There has been continual criticism. The Commonwealth countries wanted a larger share in the administration, and they were right in doing so. Why should there be this remote control from London, this Whitehall domination which the Opposition always want to remove? Further than that, the views of the company and the Commonwealth were not always in harmony. There was often a difference of viewpoint and they were not able to get their way for the same reasons that applied at home. There was, for instance, disagreement about wireless circuits between the Commonwealth and United States. Therefore, taking all the circumstances into consideration, this Measure seems to be a logical development and in keeping and in step with feeling in the Commonwealth generally.

I was specifically asked by the hon. Member for Westbury whether agreement had been reached with the company. At present agreement has not been reached, but there is no reason whatsoever to suppose that agreement will not be reached, The hon. Member referred to Clause 7. The position with regard to that is that the trade unions will be consulted in the preparation of the regulations. Clause 7 deals with redundancy, and we do not think that there will be any redundancy when the change-over takes place. Nevertheless, there the Clause is, and it is inserted largely at the wish of the trade unions which have been consulted. The other part of the Clause deals with staff entering the Civil Service. If their pension rates were greater, they will maintain them, and they will also maintain their emoluments, which seems to me to be fair, just and equitable.

Mr. Grimston

The hon. Gentleman says that Clause 7 deals only with redundancy—

Mr. Hobson

And pensions.

Mr. Grimston

Then the Clause cannot even be operated to give compensation to those who are not redundant, but who may go to the Post Office at a lower rate of emoluments? Is that so? It is even worse than I thought.

Mr. Hobson

That is another matter with which the Clause deals. What I have said in relation to Clause 7 is a perfectly true statement of fact. The hon. Gentleman dealt with what I thought was a very important point in regard to the agreement—whether there would be delay because of the power of veto. It is true that there is a power of veto, but we are dealing here with a family concern. We are dealing with partner governments in the Commonwealth, and with all due respect to the United Nations, it is not quite a fair comparison. There is an understanding among the British people and the people of the Commonwealth which will not result in stupidity and putting difficulties in the way. While that was a fair and legitimate point to make, in practice we need have no fear on that score.

In regard to Press rates, I cannot give any guarantee or assurance as to what rate should be charged, but the requirements of the Press will be borne in mind. I would also point out that the agreement shows that it will be competent for the Telecommunications Board to set up advisory committees—

Mr. McKinlay (Dumbartonshire)

What would be the rate for a Rita Hayworth story?

Mr. Hobson

—and I have never known the Press backward in coming forward and asking for what they regard as their rights.

Mr. Baxter

May I point out to the hon. Gentleman that the one penny a word Press rate really benefits the Empire as a whole, because it enables newspapers to carry more news of the Empire?

Mr. Hobson

I appreciate the point to the full. I am a great believer in the Empire and a great supporter of the Commonwealth, and I hope that the hon. Member for Wood Green (Mr. Baxter) will see that his hon. Friends think likewise. However, obviously I cannot give guarantees about the price to be charged for telegrams, but we appreciate the point about news and want to see it disseminated.

There was a rather awkward question about the pooling arrangements contained in article 7 of the third schedule of the Commonwealth Telegraphs Agreement. I felt that I had to intervene in order to point out that there was a protocol and that nothing definite has been decided about what rates shall be charged. A scheme is indicated in the article. We must have faith here and must rely on the fact that our representatives will look after our interests. I cannot say more than that, but I want to emphasise again that so far as the arrangements set out in article 7 are concerned, they are not binding and they are held over by virtue of the protocol on the last page of the Agreement.

My hon. Friend the Member for East Harrow (Mr. Skinnard) raised the question of rates of pay. That is a matter for the trade unions concerned in negotiation with the Post Office. However, there has been no worsening of the conditions of the staff taken over. There has been full consultation with all the trade unions on the matter. It may be that men at different rates of pay are working side by side, but that is not unusual when transfers take place. I had experience of that kind when many companies were amalgamated to form the London Passenger Transport Board. If my hon. Friend wants the exact rates of pay, they can be made available to him, but I am unable to give them to him in reply to this discussion.

Mr. Skinnard

I hope that my hon. Friend will agree that I was putting a case about something rather more than mere rates of pay. My case concerned frustration and interference with prospects of promotion and career. I think I was justified in raising that in the Second Reading Debate, although I am quite aware that the whole question will probably have to be dealt with through trade union channels and arbitration. However, it was competent for me to point out that there is this difference in treatment.

Mr. Hobson

That is perfectly true. What the intervention of the hon. Gentleman boils down to is that there are different rates of pay existing for two people working side by side and probably doing the same job. That is inevitable because of the form of the amalgamation we have decided to accept for Britain. On the question of promotion, that is hardly within the Bill, but I give my hon. Friend the assurance that in the Post Office the considerations of ability and seniority are always borne in mind and, as far as the transfer of staff is concerned, promotion will be decided on the merits of each case.

The hon. Member for Abingdon (Sir R. Glyn), who made an interesting contribution, asked what would be the position with regard to the cable ships under the ownership of the company. The cable ships will remain with the company. Broadcasting in the Colonies is outside the scope of this Bill entirely, but it is true that Cable and Wireless broadcast in a few of the Colonies; I believe the hon. Gentleman mentioned Kenya. In that case they will continue as heretofore. His next point was with regard to Eire, which is not affected by the agreement. With regard to cables that are laid being tapped, I think that is in the realm of conjecture. There is little I can say in answer to that point except that the Post Office know what precautions must be taken, and those that can be taken will be taken by the engineers responsible. Concern was expressed about the quarters occupied by the servants of the company. That is the responsibility of the company, which is an independent concern, but the hon. Member will notice that in the Second Schedule to the Bill the property "Meadowbank" which serves as a pied à terre for members of the staff home on leave, remains the property of the company.

Now I come to the points raised by the hon. Member for Bucklow. I think the hon. Member thoroughly enjoyed himself, and I do not propose to answer all his points. He was concerned with reduced revenue that might accrue. He is undoubtedly wrong in his assumption. Because the company continues to carry out the work outside Britain, and merely because we are amalgamating the assets of Cable and Wireless inside Britain, with three exceptions, I do not think it is a safe assumption to make that revenue will decrease. With regard to, State enterprise there is a difference between the two sides of the House, but I submit that I have said sufficient to, point out to him that Cable and Wireless were very glad at one time to have the assistance of the State, and I do not think that his argument got us very far. It is perfectly true that there may be differential rates of wages, but interjections from hon. Members behind me support my view, when they mention industries that have been nationalised and quote the wage rates.

I am not in a position this afternoon to give the assurances asked for by the hon. Member for Heston and Isleworth (Mr. W. R. Williams).

Mr. W. R. Williams

This is important because, from the point of view of hon. Members of this House, it is obvious that many hon. Members have already expressed concern regarding the situation of the people in the Post Office. If my hon. Friend cannot give that assurance today, I should like him to make it perfectly clear to the House that he will try to give that assurance during the succeeding stages of this Bill. Otherwise some hon. Members may have to review their ideas in regard to the Bill as a whole.

Mr. Hobson

That is a question for my right hon. Friend, but I have already said in answer to my hon. Friend that conditions of the staff are the responsibility of the trade unions concerned, who are perfectly free to enter into negotiations with my right hon. Friend's Department on any occasion. Further, our relations with the many trade unions with which we have day to day contacts are satisfactory.

Mr. Williams

I am sorry to interrupt again, but I notice that a certain amount of money will be given for the purposes of the Bill. What I and other hon. Members want to be quite certain about is that, later on, arbitration will not be denied because of the Money Resolution attached to the Bill.

Mr. Hobson

I cannot imagine my right hon. Friend denying any trade union the right of arbitration. As far as the £4 million is concerned, that represents the money required for paying for the assets incorporated in the British Post Office.

Mr. Shepherd rose—

Mr. Hobson

I have already given way—

Mr. Shepherd

This is an important point. The Postmaster-General has done extraordinarily well, as far as the trade unions are concerned, in getting away with Clause 7, and I congratulate him. But why is the Clause only permissive? Why does it not say that there shall be these regulations which shall afford compensation to people who suffer loss as a consequence of the transfer of their employment?

Mr. Hobson

Because there are special circumstances surrounding the people to whom that Clause refers. I attempted to follow the intervention of the hon. Member for Wood Green closely, but I did not see the point of it. The mere fact that he apologised to the Chair was proof that his remarks were wide of the subject under discussion.

Finally, I want to say that this enabling Measure integrates into the British Post Office—

Mr. Grimston

Before the hon. Gentleman comes to a conclusion, may I put two things to him? He said that Clause 7 dealt only with redundancy and I thought he would expand that later, because I said that that seemed to make it worse than ever if it only did that. The other point is, when fresh agreements are reached under the protocol with regard to matters arising in article 7 of the Third Schedule to the White Paper, can the hon. Gentleman give an assurance that those agreements will be published?

Mr. Hobson

Those agreements will be made known under the protocol. As far as Clause 7 is concerned, subsection (a) deals with redundancy should it arise, but as I have said, we are not expecting any redundancy. Subsection (1, b) deals with those people who would suffer a diminution of emoluments and they are there safeguarded. I hope I have cleared up that point.

This Measure integrates into the British Post Office all the assets of Cable and Wireless Ltd. in Britain and their staff, while it leaves the company free, independent and unfettered to operate abroad. The staff conditions, pensions, rates of pay are safeguarded in every way. The Commonwealth Telecommunications Board is formally established and legalised and the Bill, in the opinion of His Majesty's Government, is the best way of dealing with the post-war management of overseas telecommunications in this country. Further, it is in conformity with the recommendations of the Commonwealth Telecommunications Conference expressed in the agreement of 11th May, 1948, a conference which was harmonious, workmanlike and practical; and, in my humble submission, that augurs well for future Commonwealth relations, not only in the realm of telecommunications but in other fields of joint enterprises.

Mr. Frederic Harris (Croydon, North)

I did not want to interrupt the speech of the hon. Gentleman, but he tried to tie up State ownership with financial assistance by the State. I presume he appreciates that there is a considerable difference between the two?

Mr. Hobson

I appreciate it very much, and if the hon. Gentleman had been in the House all the time, he would have realised that the point he has just raised has been fully answered.

Mr. F. Harris

On that point. I have been in the House as long as I could, and I have only missed 20 minutes.

Bill committed to a Select Committee of Six Members, Four to be nominated by the House and Two by the Committee of Selection:

Any Petitions against the Bill deposited in the Private Bill Office at any time not later than the sixth day after this day to stand referred to the Committee, but if no such Petitions are deposited, the Order for the committal of the Bill to a Select Committee to be discharged and the Bill committed to a Committee of the whole House:

Petitioners praying to be heard by themselves, their Counsel or Agents, to be heard against the Bill provided that their Petitions are prepared and signed in conformity with the Rules and Orders of this House, and Counsel to be heard in favour of the Bill against such Petitions:

Committee to have power to report from day to day the Minutes of the Evidence taken before them:

Three to be the Quorum.—[Mr. Wilfred Paling.]