COAL INDUSTRY (COMPENSATION) (Hansard, 20 November 1950)

§ Sir Herbert Williams (Croydon, East)
I beg to move, That an humble Address be presented to His Majesty, praying that the Regulations, dated 27th July, 1950, entitled the Coal Industry Nationalisation (Valuation) (Amendment) Regulations. 1950 (S.I. 1950 No. 1265), a copy of which was laid before this House on 28th July, be annulled. This Prayer is being moved tonight because this is the last available day for that to be done. From my calculations, the necessary 39 days on which the Order lies will be completed by midnight to- 113 night. On the last occasion on which I was engaged in moving a Prayer we were discussing the manufacture of sausages. Tonight we have had sausages—legislative sausages—in the making. I have not seen the Serjeant at Arms work so much overtime for a long time. It looks as though the Chief Whip has really not a substantial supply with which to keep us going, and that is why the meat in the sausages is so poor.
I hope hon. Members have read the First Report from the Select Committee on Statutory Instruments, which was ordered by the House to be printed on 13th November. I forget how soon it was available. I do not think I saw it until 14th November, and it was not until 15th November—I think it was—that I realised the importance of this Report. The Committee considered the Order to which my Prayer relates—No. 1265—and they did not quite understand it. I am in the same position. There were quite a lot of them at the meeting.
If hon. Members will look at page 4 they will see that there were no less than nine Members present, and they had the attendance of Mr. Speaker's Counsel. So there were nine hon. Members, some of them learned in the law, and Mr. Speaker's Counsel, and they examined this Order and they did not understand it. They have drawn the attention of the House to the fact that they did not understand it; I do not understand it, and I do not suppose that any hon. Member who has got a copy in his hands understands it—except possibly the Parliamentary Secretary, and he has been instructed in the matter by somebody or other, who must be very intelligent.
If hon. Members will look at the Report they will see that on 13th November a letter was addressed to them by the Principal Assistant Solicitor of the Treasury Solicitor's Department, Ministry of Fuel and Power Branch. That is a new one on me. Apparently the Ministry of Fuel and Power are not entrusted with a solicitor, and they have the Treasury Solicitor and a special branch. I think that if any Department needs a special branch—[interruption.] When I was at the Board of Trade we did not need a special branch solicitor like that. This is one of those new developments.
The Committee had this letter written to them on 13th November. They must have read it that day, because they refer 114 to it. They say they considered the matter and the Memorandum from the Ministry of Fuel and Power, and then they resolved that the special attention of the House should be drawn to the Instruments on the ground that their form and purport call for elucidation. It is obviously of no use to us to set up a Select Committee on Statutory Instruments and instruct them to report to this House unless some hon. Members take the trouble to debate the matters to which they draw attention: and the only way we can do that is by moving the annulment. That does not necessarily mean that one desires to vote against the thing—which a lot of hon. Members opposite are not sufficiently instructed to understand. The object of a Prayer is very often not to destroy an Instrument but to have a debate on it and to clear up matters of difficulty.
I have read the letter referred to, and I shall read out one sentence of it. Apparently this is a problem that arises where a coal mine is nationalised and there is other property hanging around it, and it is not quite clear how the thing should be valued if the other property is rather necessary to the coal mine. I believe that they have worked out something which I do not understand. There is one paragraph which interests me very much. It says: It might he impossible to maintain the output of the colliery without suitable housing for the workers so that without assurance of the continued availability of the houses the value of the colliery might he diminished. Under the Regulation provision is made for valuation on the basis that the purchaser of the colliery would be in a position to use the houses. Hon. Members opposite are very busy denouncing tied cottages, but this is a proposal that cottages should be tied to certain collieries. Presumably, if a man ceased to work at the colliery he would vacate his house. Obviously, if a man ceases to work at the colliery he is given notice to leave his house. That is the tied cottage principle. This Principal Assistant Solicitor, Treasury Solicitor Department, Ministry of Fuel and Power Branch, writes a legal letter, but at least must have had the assent to it of his political superiors.
The Minister of Fuel and Power had a great deal of trouble at Question Time, which is possibly the reason why he is not here tonight, though he had sent what 115 the blacksmiths call a "striker." He has sent his "striker" along tonight—his assistant, his plumber's mate—or whatever they call him; he is here tonight. However, I cannot imagine this Principal Assistant Solicitor writing this letter without the authority of the political heads of the Department. In his letter he has written this declaration, that in certain cases tied cottages are necessary for coal miners. I do not own a tied cottage. I do not own my own cottage. I do not live in one. I live in a flat. However, that is in passing. It is very interesting to find this declaration from a Government Department, and I hope that hon. Members opposite will take notice of this very clear declaration of policy on the part of the Ministry in favour of tied cottages.
That part of his letter I do understand. I am afraid I do not quite understand the other part. My hon. Friend the Member for Twickenham (Mr. Keeling) is going to second this Motion, and he may have studied the other aspects of the letter and may be able to inform the House on them. I myself fail to understand it. However, I think I have said enough to justify our moving this Prayer and initiating a debate on this Statutory Instrument; I hope that in due course the Parliamentary Secretary will be able to give that elucidation which nine Members of this Honourable House could not give. Those Members belong to all political parties. There is no partisanship in this. We are entitled to that elucidation, and I hope that we shall get it.

§ Mr. Keeling (Twickenham)
I beg to second the Motion.
Two things seem to me unsatisfactory about the way in which this matter is presented to the House. As my hon. Friend pointed out, these Regulations were the subject of a Report by the Select Committee on Statutory Instruments, who said that the attention of the House should be drawn to them because they wanted elucidation. But they referred only to the Regulations as a whole, and they also asked, as my hon. Friend said, the Minister of Fuel and Power to explain them. It is only when we read the Memorandum from the Principal Assistant Solicitor of the Ministry of Fuel and Power that we find it is only one Regulation which the 116 Select Committee found obscure. That was Regulation 2. My first point is that it seems to me unsatisfactory that the Committee should leave us in the dark as to what it was they wanted explaining. We can learn that only from the Memorandum.
My second point is this. If hon. Members will turn to the last page of the Select Committee's Report they will find that the Committee had the Memorandum of the Ministry of Fuel and Power before them before they resolved that the attention of the House should specially be drawn to this Instrument on the ground that it required elucidation. Well, they were apparently either dissatisfied with the Memorandum, or they were debarred by their own rules from expressing their opinion whether it was satisfactory or not.

§ Mr. David Renton (Huntingdon)
May I attempt to assist my hon. Friend? I happened to be on this particular occasion a member of the Select Committee on Statutory Instruments. I do not think I shall be out of order if, without referring to what happened on this occasion, I state the general practice. The general practice is this, that if we are in doubt we call for a memorandum from the Minister. When that memorandum comes, sometimes our doubts are removed; if our doubts are not removed then we proceed to report the matter to the House, and state one or other of the six grounds on which we are allowed to report a matter, as being the reason why we do so. That was done on this occasion.

§ Mr. Keeling
That confirms my opinion, and I believe my hon. Friend will agree with me that the whole thing is a little obscure. It seems to me that if the Select Committee can express an opinion on a Statutory Instrument they ought to be allowed to express an opinion on the Memorandum which purports to explain it; but as it is, they have reported the Instrument to the House, and they have reported the Memorandum to the House, and we are entirely in the dark whether they find the Memorandum a satisfactory explanation or not. For these two reasons, the Committee is not the help to the House that it ought to be.

§ Mr. Bell (Bucks, South)
I support my hon. Friends who have moved this Motion. As both my hon. Friends have 117 said, the Select Committee which reported these Regulations had the advantage of studying the memorandum presented to them by the Ministry of Fuel and Power. Apparently it did not remove their doubts or enlighten their darkness, because after seeing it they still reported these Regulations to the House on the grounds that their form and purport required elucidation. I think it was Regulation 2 of these Regulations which was the one which excited difficulty in the Select Committee, and I must say it is a remarkable exercise in obscurity.
I compliment the Parliamentary Secretary to the Ministry on his courage in coming here tonight to explain, as he obviously is going to do, exactly what these Regulations mean. I will admit that after about half-an-hour of study, and a necessary break for rest and refreshment, I do know what they mean; but it is arguable that regulations should be drafted in such a manner that their meaning can be discovered rather less painfully than by the process which, for the benefit of myself, I went through.

§ Mr. Messer (Tottenham)
Would the hon. Member put lawyers out of work?

§ Mr. Bell
I entirely disclaim any such intention as the hon. Member attributes to me. I quite agree that one must not be unreasonable in one's approach to this matter. These are, of course, Regulations concerning the method of calculating compensation for the coal industry, and, of course, are a matter upon which the persons affected by it will have professional advice. They are not regulations affecting the liberty of the subject or something like that; in which case one would apply a very much higher standard of simplicity. It is a regulation where some complexities may reasonably be expected, but I do suggest to the Parliamentary Secretary and to the House that in this case obscurity has really gone beyond the bounds of reason. There is a certain fascination in these Regulations. Some of them are rather like chess problems—very advanced ones: Black to move and mate in 20 moves. I do not want to spoil the amusement of anyone who finds pleasure in working out these Regulations.
However, I would suggest to the Parliamentary Secretary some of the reasons why I think these Regulations are so extremely obscure. Perhaps he would be 118 good enough to look at Regulation 2. He will see in the second line of sub-paragraph 2 the words comprised in a compensation unit. The sentence reads: If the Valuation Board are satisfied that the property in which a transferred interest comprised in a compensation unit subsisted was, before transfer, used in association with other assets in which any transferred interest subsisted…. I defy anyone to read that sentence and to know for quite a long time what it means. There are far too many things piled one on top of another. I suggest that the words "comprised in a compensation unit" should be dropped. They are quite meaningless. Every transferred interest is comprised in a compensation unit, and even if it is not, it does not matter, because nothing turns on that in this case. These words only increase the complexity. Because somewhere else in the Regulations, earlier on, it is stated that for the purposes of compensation the assets will be divided between the compensation units, wherever the draftsman has had to deal with a transferred interest, he talks about a transferred interest comprised in a compensation unit. I think that may, therefore, well be dropped. I then suggest to the Parliamentary Secretary that sub-paragraph 2 (b) increases the difficulty, because there the expression that it would be conducive to a fair and equitable valuation is in fact governed by the word "satisfied" in the first line, a long way back. I do not think that for the first half-hour's study of the Regulations anyone would realise that.
Finally, in the last line of the Regulation, a word which caused me a lot of trouble for a long time was "were." It should be "are." The word "were" clearly refers back to the time before transfer. It does not mean to, but it does. What is meant is that the Valuation Board shall value the compensation unit which comprises the last-mentioned transferred interest on the basis of those assets being available for such use. The sense of the thing is this: Asset A is to be valued on the basis that it can be used with asset B, and, therefore, as a corollary of that, asset B is to be valued on the basis that it is going to be used in association with asset A.
119 If the Parliamentary Secretary will look at this, he will realise that the word "were" really refers back in time logically to before the transfer, whereas what is intended is not that at all. It should read in fact something like this: They shall value asset B on the basis that it is being used or that it would be used in association with asset A. It is not correct to say that they should value asset A on the basis that it "was" used with asset B. That introduces a further element of confusion, which does eventually become clear, if one spends a lot of time chopping this down, as one would in translating a Latin unseen.
I now draw the Parliamentary Secretary's attention to a matter not of form but of merit, namely, the fact that the Regulation only refers to transferred assets which are going to be used in association with other transferred assets. That appears from line 4 of Subparagraph (2). A transferred asset is to be valued on the basis that it was used in association with other assets in which no transferred interest existed. That this is so appears again from the third line from the bottom of the page, where there appear the words: as the holder of the claimant's transferred interest therein. That is a point of substance because in Section 13 (4) which the Parliamentary Secretary will find on page 3 of the Select Committee's Report, the Coal Industry Nationalisation Act gave to the Minister the power to make regulations to ensure that a transferred asset shall be valued upon the basis that it had been used before transfer in association with other assets. The Regulation narrows the scope of the Compensation. I think that it is a matter of some importance, because one could have assets which had been transferred used in association with other assets which were not transferred. The value of the transferred assets might depend almost entirely on their use in association with the non-transferred assets.
As the Regulation stands, in that case, the owner of the transferred assets could not get compensation on the larger basis which the Coal Industry Nationalisation Act clearly intended. It may be that this is inadvertent, or it may be that it is proposed to reduce the compensation payable, in which case I would suggest to the Minister that it is not right that that 120 should be done by regulations when the Act clearly envisaged a wider scope of compensation.
I hope that the Parliamentary Secretary will take back this Regulation and redraft it in language which any normal person can understand with reasonable diligence and in a sober state of mind—I do not put it too high. I think that he could do that without fear that he is damaging the earnings of my profession. The people affected would still have to come to us to make sure. A regulation like this one which is before the House and which is going to become law should not contain any unnecessary obscurities. For these various reasons—of which prolixity is the greatest—this regulation does contain too much obscurity.

§ The Parliamentary Secretary to the Ministry of Fuel and Power (Mr. Robens)
I am certain that the speech of the hon. Member for Bucks, South (Mr. Bell), has now made crystal clear to the House what these Regulations really mean. The hon. Member for Croydon, East (Sir H. Williams), who opened this Debate gave me two more titles—a plumber's mate and a blacksmith's striker—which I can now add to the one which the right hon. Member for Bourne-mouth, East, and Christchurch (Mr. Bracken) gave me when the Gas Bill was under consideration and when he described me as a lonely carbonised Casabianca. I am gradually acquiring a very large number of additional names.
The hon. Member for Bucks, South, raised one or two points which I will deal with if I may before I go on to do what the mover of the Motion requested me to do, and that was to elucidate the obscurity of these Regulations. He referred to "were" as not being the correct word to use; but the word "were" is used because it throws this back to the vesting day which is of course the date of the valuation, and therefore I think that "were" in that context was right. We continue to use the phrase "comprised in a compensation unit" because these words define with absolute certainty the assets to be dealt with.
These Regulations do two things: Regulation 2 is concerned with the valuation of property in a compensation unit on the basis that the assets formerly 121 used in association with but not in that compensation unit would continue to be available for such use. As the hon. Gentleman knows, compensation units are divided into four or five classes. There are the main units comprising the principal assets—collieries, brickworks and so on. Stocks and stores are another unit, and railway wagons are another unit. The main units contain assets falling within the global sum—that is the collieries, etc.; and subsidiary assets receiving compensation outside the global sum such as farms and houses.
It will now become apparent that we have a situation where, for example, a colliery company formerly owned both a colliery and coke ovens on an adjacent site. For compensation purposes, the colliery and the coke ovens may well be grouped in different compensation units. Clearly, it is reasonable to value these two assets on the basis that they are still associated, because the coke ovens may well be worth more on the assumption that they are to be assured of a supply of suitable quality coal close at hand, than on the assumption that the coke ovens are separate and the suitable quality of coal is not available. Accordingly, when the regulations were first made in June, 1947, provision was made for valuing compensation units on the basis that the property in these units could continue to be used in association with other assets.
For convenience, we refer to this basis of valuation as valuation on the basis of "continuing availability." In the original regulations, valuation on the basis of continuing availability could only be made where the claimant requested it. Under the present Regulations, it can also be made on the application of any other party to the proceedings, but only if the Valuation Board is satisfied that it would be conducive to a fair and equitable valuation of the property. This is the main difference between these regulations and the regulations of June, 1947. The circumstances in which the purchaser on the assumed sale of the unit "would be in a position to use" the other assets, are specifically stated "as the holder of the claimant's interests therein."
This provision, where property is valued on the basis that the purchaser is in a position to use assets in association with it brings in miners' houses, but has 122 nothing to do with the principle of a tied house. The purpose is to find out what is the value of the houses and of the colliery. It may well be that the colliery with houses around it would be worth more than the colliery with houses owned by someone else and let to anyone. Therefore, it is important for purposes of valuation to regard the ownership of the houses in association with the pit, and vice versa, if we are to get a proper valuation of the colliery, on the one hand, and the houses, on the other.

§ Mr. Renton
I have been following this argument very closely, and it seems to me that there must have been cases, which these Regulations are designed to meet, in which houses formerly owned by the former owners of the colliery have not been taken over by the National Coal Board. If that is so, it explains, to a certain extent, the reason for these rather obscure Regulations, and the method of valuation based on severance which has been adopted. It comes to me, and I am sure it will do so to many other Members, as a very great surprise to learn that collieries have been taken over without their houses. It is only by means of these Regulations that this has come to light. Perhaps we might have an explanation of that.

§ Mr. Robens
I would not come to that conclusion on what I have said, that collieries have been taken over without houses. We are trying to establish the basis of compensation.
Perhaps I might enlarge on the illustration. Let us assume that we have a miners' village in the wilds, with the houses occupied by the men who work in the pit. They would not be houses for other purposes, in point of fact, because of the isolated nature of the colliery. If we take the houses over on the basis of a willing buyer and a willing seller, there would be a very different value as against taking them over in association with the colliery.
That is the point I have been trying to make. It seems to me that it will help rather than hinder the valuation to be placed on the particular assets. It also works the other way round. A colliery without houses would be less in value than the colliery with houses. Therefore, we say that we must take into consideration, in these compensation units, the association of the other assets being 123 transferred. I hope that I have made that clear.

§ Mr. Bell
Is not the position that if the colliery were taken over without the houses, we could not assess the compensation for the colliery upon the assumption that the houses were available for use with the colliery, because the houses would not be an asset in which the interest was transferred?

§ Mr. Robens
I do not think the hon. Member is following me closely enough. As some of my hon. Friends behind me, who do not belong to the legal profession, seem to be following me, I should have thought that the hon. Member would have seen the point I am trying to make. The colliery compensation comes from the global sum, and the other assets have to be valued. Therefore, there is a difference. The global sum has been fixed, although I do not want to go into the details, which are well known, and is divided into districts, with the districts deciding the value of each colliery. When we come to find a valuation for the other assets for which no global um is fixed, we must value the houses as though the colliery were still part and parcel of them, although they are not a separate compensation unit.

§ Sir H. Williams
Surely the object is to enable them to be taken over in association with the colliery?

§ Mr. Robens
The object is to enable a fair compensation value to be placed on these other assets, which can only be done if we associate them with the use to which they were put.

§ Sir H. Williams
Who is taking them over?

§ Mr. Robens
The State, or the National Coal Board.

§ Sir H. Williams
Then they are tied houses.

§ Mr. Robens
I should not jump to the conclusion that they will always be tied cottages. The hon. Member may be in for a surprise about miner's houses in due course, but that is a subject for another debate.

§ Mr. Bell
Will the Parliamentary Secretary deal with the point I made about the compensation provision only applying to assets used in association with other assets which are to be transferred? 124 My example about a colliery and houses may not perhaps have been a good one, because the colliery compensation comes out of the global sum. Will the Parliamentary Secretary reply to my point in regard to assets which are to be transferred used in conjunction with other assets which are not to be transferred?

§ Mr. Robens
It is only the assets which are being transferred that are to be valued. There is no point in valuing assets which are not to be transferred.

§ Mr. Bell
The Parliamentary Secretary has misunderstood me. I am asking what is to happen in the case of valuation of assets which are being transferred and which owe their value to the fact that they are used with other assets which are not being transferred. It is those words which limit the effects of these Regulations to assets which before transfer were used in association with other assets "in which any transferred interest subsists." These words do not appear in the Act, but do appear in these Regulations.

§ Mr. Robens
I think that the hon. Gentleman has added confusion to a very interesting and enlightening Debate. As I have indicated, the compensation units are divided into five groups. No collieries will be broken down to less than two compensation units, and some will be five. Wherever there has to be a relation between the transferred asset and assets which were formerly in the use of the colliery company, in accordance with the Regulations that assessment will be made. I do not see that I could make this any clearer than to go on saying that what we are trying to establish is a fair valuation and that we cannot do that unless we associate what we are transferring with its previous use, whether transferred or not.

§ Mr. Bell
I am inviting the hon. Gentleman to do that. I understand exactly what he is saying—

§ Mr. Deputy-Speaker (Colonel Sir Charles MacAndrew)
The hon. Gentleman has already spoken. He must ask the leave of the House to speak again.

§ Mr. Robens
Regulations 3 and 4 make the Coal Board a party to all proceedings before the valuation boards, and give it the right to apply for a review of the determinations of those boards and to be a party to the review if a review is asked 125 for any other person. The June, 1947, Regulations did not make the National Coal Board a party to the proceedings and that decision was taken, very largely, because at that time the Coal Board already had a very heavy burden in taking over production and other matters in connection with the industry. So the Ministry, who were parties to the proceedings, called in from time to time as their advisers and their technical experts the Coal Board itself.
Now the Coal Board is brought in as a party to the proceedings for two very important reasons. One is that all the compensation indirectly forms the capital of the National Coal Board, and, very naturally, the Coal Board has an interest in the result. Secondly, the Coal Board alone has the special knowledge on many matters at issue. The Board asked for the right to be heard on their own account instead of merely on behalf of the Minister and it seemed to us that there was no good reason for withholding that right.
Whether the merits of the Regulations are obscure or not, it is certain that their object is to improve the compensation procedure, and that is an aim which should commend itself to the House. While the Regulations may appear obscure to the average individual, it should be recognised that they concern only the former coal owners and the National Coal Board, and I am certain that, with all the legal advice and everything else that the Mining Association and the National Coal Board have, the Regulations are perfectly clear to those bodies. I agree, and I well understand, that they appear to be obscure, but, after all, the matter of compensation for the coal industry is very complicated, and unless one is familiar with the whole of the procedure from the very beginning it is impossible for any regulation like this, which deals with only one aspect of the matter, to be crystal-clear without very great study. I am not a lawyer, but I hope that I have been able to put this into simple English, and have persuaded the House that what we are doing is really very clear, and that the House will pass the Regulation.

§ Sir H. Williams
Under our Rules I have a right of reply. The Parliamentary Secretary said that someone had called 126 him "Casabianca" and he reminded me of Casabianca when he stood alone on the burning deck. The rest of the words I will not repeat, but he read his brief with great vitality. I wish that I were satisfied that he understood it as clearly as did the gentlemen who prepared the written document.[HON. MEMBERS: "Cheap."] That is a perfectly proper observation to make. Hon. Members do not seem to realise that we are supposed to debate here, and, although Standing Orders permit one to make reference to one's notes, one is not supposed to read speeches. It is a bad habit.

§ Mr. Robens
I am prepared to hand over my notes and to defy the hon. Member to compare them with HANSARD and say that I was reading them. I was not.

§ Sir H. Williams
I have never seen an hon. Gentleman who was not reading his speech have his eyes so fixed on the Despatch Box the whole time he was speaking. [HON. MEMBERS: "Cheap."] I am not going to be suppressed. [An HON. MEMBER: "The hon. Member should take off his glasses."] I am putting on my glasses because on looking at the Report of the Select Committee I observe that five out of the nine who were present were lawyers. Three of the lawyers belonged to the Labour Party, one was a Conservative and the other was a National Liberal. Having had the explanation of the legal gentlemen attached to the Parliamentary Secretary's Department, they still resolved that the matter required elucidation. I do not suppose that a single hon. Member opposite who was jeering a moment ago could, if questioned outside, give me a coherent interpretation of the regulation. It would do hon. Gentlemen a lot of good if they would occasionally try to listen to the Debate and try to understand it instead of indulging in jeers which have no significance.
The Debate has served a useful purpose. It will make the Ministry much more careful in drafting orders. It is our duty to make sure that these documents which have the effect of law and may have to come before the courts for interpretation are put in language which is as clear as possible to all concerned, and if the Debate will have that effect it will have served a very good purpose. As to the merits of the Regulations, I am not sufficiently well informed about the circumstances to express a judgment. I do not 127 propose to withdraw the Motion; it can be negatived. However, we have been thoroughly justified in drawing the attention of the House to the Report of its own Select Committee.