HC Deb 28 November 1949 vol 470 cc787-93
The Minister of Transport (Mr. Barnes)

I think that the House will wish to be informed that the British Transport Commission have made an application to me to make regulations under Section 82 of the Transport Act for the purpose of authorising an increase in certain of their charges.

Hon. Members will be aware that the Commission's net revenue deficiency for 1948 was £4¾ million and that the Commission indicated in paragraph 69 of their first annual report that a further marked deterioration of the working results in 1949 was inevitable. At present it appears likely that the net revenue deficiency for the current year will exceed £20 million, and that it would be greater in 1950 on the basis of existing charges, apart from any question of recouping the accrued deficiency. I consider it expedient that the question of an increase in their charges should be examined with the least possible delay.

I have accordingly, in conformity with the provisions of Section 82 of the Transport Act, decided to consult with and consider the advice in this matter of the permanent members of the Transport Tribunal acting as a consultative committee. In doing so I have expressed the view that they will no doubt think it desirable to consult with such representa- tive bodies of traders and shipping as they think fit and take their views into consideration.

The Commission do not in their application propose any increase in passenger fares and I have informed the committee that I am in agreement with the Commission on this point.

The increased powers of charges sought by the Commission are, in effect:

Railway charges:

A general increase of 16⅔ per cent. in the present charges applicable to freight train traffic and to parcels, other merchandise and livestock by passenger train or other similar service.

Canal charges:

A general increase of 16⅔ per cent. in present charges.

Dock charges:

  1. (a) Dues on coastwise vessels and cargoes: the present general increase of 25 per cent. over charges in force on 31st August, 1939, to be raised to 50 per cent.;
  2. (b) all other rates, dues and charges: the present general increase of 75 per cent. over charges in force on that date to be raised to 100 per cent.

For the convenience of hon. Members I am having copies of the Commission's applications and the reference to the committee placed in the Library.

Sir David Maxwell Fyfe

While reserving our position as to the import of the statement until the Debate on Thursday, may I put two questions to the right hon. Gentleman? First of all, are the charges proposed by the Commission purported to be based on the principles of transport charges in the formulation of which they say, in their report, that they have made progress? If so, what principles? Secondly, what is the estimated effect of the increase in the charges upon the prices of export goods?

Mr. Barnes

With regard to the first question put by the right hon. and learned Gentleman, I considered that it was essential that this statement should be made today so that hon. Members would have sufficient time to consider its implication in preparation for the Debate on Thursday, which will enable us, in a much better form than supplementary answers, to discuss its implications. The uniform increase which is proposed is not based in any way on principles which are likely to emerge in the charges scheme, as laid down in the Transport Act. It follows the method which has been adopted since the end of the war of a flat-rate increase. It does not in any way anticipate the preparation of the charges schemes or the principles upon which they will be based.

With regard to the impact of these charges upon export costs, what we have to bear in mind in this matter is that the charges of the railways have been increased by 55 per cent. whereas their weighted average of expenses has increased at the rate of 120 per cent. As the Commission pointed out, although they have been reluctant to avail themselves of the emergency provisions which were provided in the Transport Act, nevertheless they could not indefinitely go on meeting rising expenses when their revenues and passenger receipts were not equally increased.

Sir D. Maxwell Fyfe

While appreciating the right hon. Gentleman's desire to inform the House as soon as he possibly could, may I ask him to take the questions which I have put to him as notice of the matters on which we shall certainly desire information on Thursday.

Mr. Clement Davies

As this is such an important matter, which is bound to have a very serious and deleterious effect upon all trade, may I ask whether it would not be right to make a full inquiry into the efficiency with which this industry is run before the charges are increased? Secondly, is it now to be taken as the settled policy of the Government that when there is a loss upon a nationalised industry, however or whatever the cause, that loss is to be passed on to the public, thus wiping out the claim that the industry is being run inefficiently?

Mr. Barnes

One can hardly raise a question of efficiency in a matter of this kind, when we have to consider the rather brutal fact that the industry's charges have increased only 55 per cent., which is the lowest percentage increase of any service or product of a major character in this country. During this period, every other industry has been raising its prices. The railways, as everyone knows, are heavy consumers of steel, coal and timber, and a great variety of other products. The wages of railwaymen and railway operatives must move with the general increase of wages in the community. As I have already asked: what other industry is bearing a weighted average increase of 120 per cent. in expenses and costs of materials while securing only 55 per cent. in its charges? This is not a question of inefficiency.

Mr. Ernest Davies

In view of the ill-effect upon the cost of living and the general costs of production of a general rise in railway charges, will my right hon. Friend, before implementing the report of the Tribunal, give full consideration to subsidising the transport industry rather than putting up the charges, until the full charges scheme can be brought into operation, and the full effects of the integration and co-ordination of the industry are felt?

Mr. Barnes

When I obtain the report of the views of the permanent members of the Tribunal in a consultative capacity, I and the Government will give full consideration to its implications.

Professor Savory

Does the right hon. Gentleman estimate that these increased charges will cover the enormous deficit of £20 million?

Mr. Barnes

The application is being made for the purpose of preventing this loss from accumulating prior to the introduction of the charges scheme.

Mrs. Jean Mann

My right hon. Friend has stated that there will be no increase in passenger fares, but is he not aware that an increase has already been intimated, to operate from 1st January, on all the Clyde coast piers and that this increase is very much resented by the people of Scotland?

Mr. Barnes

That appears to me to be an entirely different question. It refers to steamers and not railways.

Mr. Eden

May I ask the right hon. Gentleman, quite apart from questions of efficiency or inefficiency in respect of the industry, whether the Government as a whole have made an estimate before considering these proposed new charges, of their effect on our trade generally, and particularly on our export industry?

Mr. Barnes

Yes, Sir. All these matters have been taken into consideration. While I could not in any way indicate the percentage increase on costs which this will represent to every industry and every product, nevertheless its general implications on industry, prices and costs of production have been taken into consideration.

Mr. Driberg

Is my right hon. Friend aware how disappointing his statement will be to the Conservative propagandists who prophesied in one of their official leaflets that the deficit would be three times as much as in fact it is?

Brigadier Prior-Palmer

Has any consideration been given to exempting goods for export from these charges?

Mr. Barnes

No, Sir. I would emphasise that at the moment my decision has been to refer this to the permanent members of the Tribunal, and therefore it is not for me at present to anticipate matters of that kind.

Mr. A. Edward Davies

What reason is there to suppose that the railways can earn a revenue if their charges are to be increased when they cannot earn one at the moment? Would not the proper answer to the problem be a speedier integration and co-ordination of the services, since the Minister has said, to use his phrase, that the industry can wash its face only when that has been done?

Mr. Spence

In view of the vital importance of this matter to the export trade, can the right hon. Gentleman say approximately when the increased charges will become effective? It is a very important point.

Mr. Barnes

I regret that I cannot give a date. When they study my statement today, hon. Members will see that I have indicated to the members of the Tribunal that I should wish them to consult representatives of trading and shipping interests and that I have also indicated to them the urgency of the problem. However, I am afraid that I cannot put a date on their deliberations.

Mr. Mellish

As the Conservative Party are trying to say, and will say at the General Election, that if the railways had been privately owned there would not have been a loss, can my right hon. Friend make any comment upon that?

Mr. Barnes

Hon. and right hon. Gentlemen will have ample opportunity to comment on matters of that kind on Thursday.

Mr. Boyd-Carpenter

Can the right hon. Gentleman say approximately how long he expects the consultations of the permanent members of the Tribunal to take? Can he also say whether when his decision has been made the regulations which he will make will be subject either to affirmative or negative procedure in this House?

Mr. Barnes

I should hesitate to embarrass the members of the Tribunal by making any statement on time here today. I have contented myself with conveying to them the urgency of the problem.

Mr. Boyd-Carpenter

And the regulations?

Mr. Barnes

I cannot say now.

Mr. Charles Williams

Has the right hon. Gentleman had any direct consultation with the Minister of Agriculture as to the effect which the increased charges are likely to have on both agriculture and market garden produce?

Mr. Barnes

Yes, Sir. All Departments affected have been consulted, and this statement has obviously been made with the concurrence and agreement of the Government.

Mr. Scholefield Allen

So that the House can get this matter into proportion, can the Minister say what the percentage increase compared with pre-war figures, on the freights of privately-owned steamships operating on the ocean?

Mr. Barnes

No, Sir, I could not quite say that, but I can indicate that if by any chance an increase of 16⅔ does emerge from these deliberations, it will represent an increase in railway charges on freights of 80⅚ per cent. on pre-war charges. With regard to dock dues for sea-going vessels the charge will be 100 per cent. over pre-war rates.

Mr. Marlowe

As the right hon. Gentleman says that the full implications of this have been considered, can he tell the House the extent to which the increased cost of coal will offset devaluation, and, secondly, can he say to what extent the 25 per cent. increase for coastwise shipping will increase the price of coal to domestic consumers?

Mr. Barnes

I am afraid that I cannot at this stage give the percentage increase on every product, as I said before, but I would remind hon. Members that at this stage this is an application by the Commission. I am proposing to consult the permanent members. Whether this will be the final decision or not, I cannot say at this stage.

Several Hon. Members

rose —

Mr. Speaker

This has been going on for a long time now, and there have been many questions which have been debating points and not really supplementary questions.