HC Deb 26 May 1950 vol 475 cc2383-90
Mr. Ronald Williams

(by Private Notice) asked the Minister of Fuel and Power whether he has any statement to make on the progress of the negotiations with the American oil companies.

The Minister of Fuel and Power (Mr. Philip Noel-Baker)

Yes, Sir. As I told the House on Friday last, His Majesty's Government have for some time been discussing with the Government and with the oil companies of the United States how the dollar cost of imported oil might be reduced, and how additional supplies of petrol might thus be made available in the United Kingdom. My right hon. Friend the Minister of State for Economic Affairs spoke of these discussions in a speech at Harrogate on 10th February. Last week in our Debate I brought the story of the negotiations up to date. I told the House then of some earlier proposals which the Government had not, to their regret, felt able to accept.

I also told the House that we had had a new proposal which we were then discussing. This was a proposal from the Standard Oil Company of New Jersey. It was to the following effect: that if petrol rationing in the United Kingdom were abandoned, the company were prepared to bring in additional supplies for sterling. The other United States company concerned, the California Texas Oil Company, agreed to a similar arrangement. Both companies undertook to spend the sterling so acquired in the sterling area on additional goods and services to be used by them in their oil operations, or on the building of tankers here.

When we received this offer we asked the British companies whether, if petrol rationing were ended, they could find the other petrol required from sterling sources. The refinery expansion programme has, I am glad to say, made better progress than we expected, and the British companies have therefore been able to give the Government an assurance that they are now in a position to do this. The supply of this additional sterling oil must, as the Government have always explained, involve some dollar cost, but in this case the amount is not appreciable.

The Government have, therefore, decided to end petrol rationing forthwith. They have always said that they would do this as soon as it could be done without an appreciable dollar cost. The expansion of oil refining by the British companies and the successful negotiations with the United States companies, which I have mentioned, have created the conditions in which we can carry out our pledge. We can now end the rationing of petrol without impairing our ability to import essential foodstuffs, the timber needed for the housing programme and the raw materials for the maintenance of full employment.

It will, of course, be necessary to bring to an end by Order in Council the Motor Spirit (Regulation) Act, 1948, and accordingly His Majesty is being advised this afternoon to appoint 27th May, 1950, as the date on which it will expire. As from the same date, tomorrow, 27th May, the Motor Fuel (Control) Order, 1948, will be revoked, and all the other Instruments under which the present petrol rationing scheme is administered will cease to have effect. The necessary Instrument will be laid before the House today. This means that, as from tomorrow morning people will be able to buy petrol without coupons and without regard to whether it is white or red.

The House is aware that motorists who have used their standard ration only have been allowed to licence their cars at half the normal rates of duty. Now that petrol rationing is abolished, this concession, of course, must be withdrawn; the Treasury are, therefore, making the necessary order under paragraph 4 of the Sixth Schedule of the Vehicles (Excise) Act, 1949. This means that no more new licences can be issued at half the normal rate, nor can existing licences be renewed at half the normal rate. Nor can existing licences be converted, as hitherto, on the surrender of coupons, from the full to the half rate; but existing half-rate licences will still be valid and will remain in force until the date when they expire.

I am sure that the House will welcome this happy outcome of our negotiations and will be grateful for the efforts of all those who have made it possible, including, in particular, the United States companies concerned. I am sure that they will also wish to thank the public servants who have performed the thankless task of administering the rationing of petrol with such conspicuous fairness and success.

Mr. R. Williams

While thanking my right hon. Friend for this announcement, which will no doubt be received with great interest in all parts of the House, may I ask whether he agrees with me that the announcement and its timing are a great tribute to the efforts which have been made by the British companies in expanding their refining capacity?

Mr. Noel-Baker

Yes, Sir, certainly, and of course we have given them full support as far as the Government could do so.

Mr. Geoffrey Lloyd

May I, first of all, thank the right hon. Gentleman for his courtesy in taking pains to make this statement to the House of Commons before the Recess? May I also, as the Minister who had the duty of introducing petrol rationing in the Autumn of 1939, give him my personal congratulations on being in the fortunate position of being able to abolish petrol rationing, we hope for ever, in this country? However, would he also agree with me that his task in this respect has been somewhat easier than that of his predecessors in office by reason of the greatly increased representation of the Opposition in the present House of Commons, and no doubt also by the stimulating effect upon the Lord President of Parliamentary defeat upon this issue before Easter?

I should further like to ask him whether he realises that there is nothing in the agreements with the American oil companies which have made possible today's announcement which could not have been arrived at many months ago—indeed, before Christmas—if the negotiations had been conducted with a greater skill by His Majesty's Government at that time? In view of the many injurious statements which have been made by Government spokesmen with regard to Opposition leaders, and particularly with regard to the statement of my right hon. Friend the Leader of the Opposition during the General Election, I should like to ask the Lord President to make arrangements for a collective act of penitence and apology by the Cabinet.

Mr. Emrys Hughes

Will my right hon. Friend say whether the abolition of petrol rationing is due to the success of the principle of bulk purchase?

Mr. Noel-Baker

Well, Sir, there is something in that point. In reply to the right hon. Member for King's Norton (Mr. Geoffrey Lloyd), I should like to congratulate him on having introduced petrol rationing when it was required and on the great dollar saving which it has made throughout the last 10 years to the economy of the country. Without it we should have been in a disastrous position. I should also like to say that the credit for this achievement goes, of course, principally to my predecessors and, in particular, to my right hon. Friend the Minister of State for Economic Affairs, who started the negotiations which have led to this result. The right hon. Gentleman asked me whether this could not have been done sooner. I told the House last Friday that we had had other offers over the last few months which we could not accept for the reason that our dollar position did not permit it. This new offer is a better offer and our dollar position has improved, and we are now able to do this at the earliest moment at which it could possibly have been done.

Mr. Geoffrey Lloyd

May I, with respect, ask the right hon. Gentleman to appreciate that these negotiations were opened by the Government originally in a most unfortunate manner which actually attracted a rebuke from the American Secretary of State, and that they could have been brought to a successful issue a long time ago?

Mr. Emrys Hughes

Sour grapes.

Mr. Harold Macmillan

May I ask whether this experiment in freedom is likely to be permanent or whether it is only temporary?

Mr. Chetwynd

Can my right hon. Friend say what the attitude of the Opposition would have been if he had made the announcement at the time of the General Election, as they seemed to want it?

Mr. Noel-Baker

My reply to the right hon. Member for Bromley (Mr. H. Macmillan) is that how long it remains will, of course, depend on how well the economic affairs of the nation are conducted. If the present Government remain in office it will be permanent.

Mr. Boyd-Carpenter

Will not the Minister add to his congratulations to my right hon. Friend the Member for King's Norton (Mr. Geoffrey Lloyd), further congratulations for having suggested in his speech before Easter the use of the method for obtaining petrol which the Minister has now adopted; and will the right hon. Gentleman also say why it was irresponsible to suggest in February what he has, in fact, achieved in May?

Mr. Noel-Baker

In reply to the first question, I think it was—if I may say so without appearing to be condescending—very intelligent of the right hon. Gentleman to suggest this, but the Government had in fact already been doing it for some months before.

Mr. Macmillan

In February?

Mr. Noel-Baker

Yes, Sir.

Mr. Macmillan

During the General Election?

Mr. Noel-Baker

Before that. It began in November.

Mr. Macmillan

Was it then irresponsible?

Mr. Noel-Baker

I have quoted the statement of my right hon. Friend made months ago. He said then that the dollar position was improving and that talks were then going on to see if we could get extra petrol without spending dollars. He said that those talks had been going on and were continuing and that we should certainly do away with rationing as soon as we could afford the extra supplies.

Mr. Geoffrey Lloyd

Will the right hon. Gentleman bring today's statement to the attention of the Minister of Health, who as late as Monday in this House was confronting the Conservative Opposition with the alternative of more petrol as against more houses; and would he suggest to him that in his field he might also take a leaf from the Conservative Opposition's policy?

Mr. Noel-Baker

My right hon. Friend the Minister of Health knows all about this statement, of course. Perhaps I might draw the attention of the right hon. Gentleman to my statement this morning in which I said quite plainly that we had been able to do this: Without impairing our ability to import … the timber needed for the housing programme.

Mr. Geoffrey Lloyd

We could have done that six months ago.

Mr. A. Edward Davies

Does my right hon. Friend know that his decision will be applauded by the great mass of the people of the country, and particularly by the people who are more interested in food than in petrol, and that they will applaud the way the matter has been handled and the courage of the Government in examining the American proposals so steadily and getting, as it seems to us, a better deal; and that we do not take the view that it is as a result of duress from the Opposition?

Mr. Niall Macpherson

Can the right hon. Gentleman assure the House that sufficient supplies will be available to meet the additional demands in the initial stages and that we shall be better off in regard to petrol than we were in regard to sweets? Also, what is the technical position regarding the repeal of existing legislation? What happens to people who have red petrol in their tanks tomorrow?

Mr. Noel-Baker

Tomorrow they will be all right, I think. On the first point, I have the fullest assurances that there will be sufficient stocks to deal with anything that will arise over this weekend. The private motorist, will, of course, be able to use red petrol. Garages have large stocks of it and commercial vehicles are not on the road, and therefore I think that it will be all right.

Sir John Mellor

What consequential reduction of staff will now be possible in the right hon. Gentleman's Department?

Mr. Noel-Baker

At present, counting in both Ministry of Transport employees and staff and those who work for my Ministry, it is about 2,100. It is coming down all the time, but it is about that. A few are permanent civil servants who will be transferred to other Departments or to other work. The great majority of them are temporary civil servants who will, with the thanks and gratitude of the nation, pass to other employment.

Wing-Commander Hulbert

May I ask the right hon. Gentleman, or the Lord President of the Council, whether this very welcome announcement to the motoring community is the first tangible result of a Dorking weekend?

Mr. Peter Smithers

Will extra supplies of American petrol mean that we may get a higher octane value in our petrol?

Mr. Noel-Baker

I would like notice of that question. Perhaps the hon. Gentleman will put it down.

Brigadier Clarke

Shall we be able to buy branded petrol in the near future?

Mr. Noel-Baker

I am afraid that I cannot hold out any prospect at present of a restoration of branded petrol.