§ 11.9 a.m.
§ Mr. Crosland (Gloucestershire, South)
I beg to move,That this House welcomes the fact that the Monopolies Commission has now published its first two reports; but urges His Majesty's Government to consider whether ways and means can be found to speed up the work of the Commission and whether general legislation against monopoly practices can be introduced at an early date.Before I begin my main argument, I should like to make it clear that, so far as I am concerned, I have no objection at all to the two Amendments which stand in the name of the hon. and learned Member for Chertsey (Mr. Heald)—the Amendments in line 4, after "Commission," to insert:without detriment to the right of persons interested to a fair and adequate hearing.and in line 4, after "can," to insertusefully.I think that they have been put forward in a purely helpful spirit without any desire to destroy the intention of the Motion.
It is now almost exactly three years since the Monopolies and Restrictive Practices Act became law, and I think that hon. Members on both sides of the House will agree that now is a convenient time to review the Act and to review the operation of the Monopolies Commission which was set up under it.
The underlying basis of the Act was that we should adopt in this country what one might call the gradualist or piecemeal approach to monopoly instead of what was the alternative—adopting the American approach of declaring all monopolies and all restrictive practices illegal by a stroke of the pen. Personally, I think there is a good deal more to be said for the American approach than is often admitted, but at any rate that is an idle discusion now because, with the support of all parties, the House chose the alternative method of setting up the Monopolies Commission to investigate and to have a preliminary period of investigation before any general action against monopolies Was taken.
Clearly, there is a very strong case indeed for this piecemeal or gradualist approach. At any rate, there is a strong case given two conditions, but if those conditions are not fulfilled then this approach becomes a pure farce and becomes a fine recipe for doing nothing at all and for sidestepping all action. Of these two 2690 conditions which I consider must be fulfilled if the Monopolies Commission approach is to be of any use at all, the first and probably the less important is that where the Monopolies Commission, on investigating a particular industry, find that some restrictive practices are in operation which are contrary to the public interest, then the Government shall introduce an ad hoc order to forbid those practices in that industry.
This was quite clearly envisaged in Section 10 of the Act. I think I have read almost all the discussions which took place on the Act, and I believe that Section was supported by both parties. Indeed, it seems to me clear that it is essential to have this power to introduce ad hoc orders, for this reason—that everybody foresaw that it must take a considerable time for this period of investigation to be completed and must take a considerable time before any general action against monopolies would be possible. I do not think anybody on either side of the House was prepared to accept the idea that during this considerable period, almost certainly a period of years, no action whatsoever was to be taken, even in the face of restrictive practices which were shown to exist by the Commission and which were condemned by the Commission as contrary to the public interest.
I very much hope that the Government will be quite firm on this point, because it is a little disturbing to find that some people are now suggesting that it is unfair to forbid a practice for instance in the case of dental goods, when it is known that the practice exists in other industries as well. It has been argued in some quarters that it is unfair to discriminate—that it is unfair, for instance, to condemn and to forbid a collective boycott in the case of dental goods when it is known to exist elsewhere, and that we should do nothing about that boycott until we are able to introduce general legislation for all industries.
2691 I hope the Government will be quite firm against such suggestions. I am glad to see that at long last, after a very long delay we are to debate the Order on dental goods next week, and I hope the Minister of Works will do something about rainwater goods with a little more expedition. I think the consequence of not doing anything on the lines of Section 10 and of not introducing these desist orders would be to place us in the quite ridiculous position that in 1951 every single restrictive practice in industry which was operating in 1945 would continue to exist. We expected a good deal of delay, but I think we are all agreed that we cannot be placed in that ridiculous position.
That is the first condition which must be fulfilled if this piecemeal approach is to be successful. The second and really more serious condition is that this investigation by the Monopoly Commission shall be carried through at a reasonable speed. I was not in the House at the time when the Act was passed in 1948, but I imagine that most hon. Members must have had in their minds the idea that by the end of about three years a considerable number of reports would have been produced and we should at any rate be in sight of some general legislation on the broader front.
It is now three years since the Act became law, and we have precisely two reports. The future outlook is not very much better. It is true that one extra member was appointed to the Commission last December and that we were promised another, but the second has not yet been appointed. But, even with the additional members, it is estimated that the annual output of reports by the Commission will be only some three or four a year. We shall have reached the beginning of 1952 before the first six references to the Commission have finally been reported upon.
I suggest to the House that the position is, in fact, a good deal worse even than those figures suggest. It would not be so bad if the six first reports were on major industries of considerable size and considerable importance. In fact, they are not. They are on very tiny industries, or even subsections of industries. They are not, for instance, on six out of the 100-odd groups into which industry is divided for census of production purposes. Of the first two reports, that on dental 2692 goods covers an industry which employs some 6,000 people, which is roughly one to 4,000 in the total working population; and the second report, on rainwater goods, covers industries employing some 3,000 people, which is one to 8,000 of the total working population.
My hon. Friend the Member for Bristol, South-East (Mr. Wedgwood Benn), who is an amateur mathemician, tells me that altogether this adds up to some 0.0045 of industry, as measured in terms of labour employed—and nobody can say that to have covered 0.0045 of industry three years after the Act was passed and six years after a radical Labour Government came into power is a spectacular achievement. He also tells me that if we were to continue at this rate it would take approximately 2,400 years to cover the whole of industry—and many changes may have taken place by then which will render the whole process somewhat out-of-date.
I also have one small further calculation which may assist the House in assessing the speed at which we are moving. If we decided to walk round the world at this speed and started from the Palace Yard at Westminster when the Act became law three years ago, at the present rate of progress we should barely have reached Uxbridge. That is the position which we have reached three years after the Act became law, and I think it is a very serious position which, so far as I can understand it, was not expected or anticipated by either side of the House when this important Bill was being discussed.
I do not blame the Members of the Commission for this rate of progress. Personally, I think the membership of the Commission was not quite as strong as it might have been, but at any rate I am certainly not putting most of the blame on them. They have produced some thorough reports, and there are no complaints about their method of working, which is creditable; and clearly the fault lies not in the Commission itself but in the actual approach which was chosen, in good faith, by the House in 1948, but which I think has now proved to be inadequate, at any rate in its original form.
The point I want to submit to the House is this. We have now come to the point when a new policy decision is re- 2693 quired from the Government, because if we continue to pursue our present approach unamended we are postponing into the quite indefinite future any possibility of effective action against monopoly practices.
If we are agreed that a new policy decision is required, it is of course, very tempting—and I think a lot of people are tempted by this to say: "All right; let us give up the entire approach via investigation and via the Monopolies Commission and throw overboard the whole of the 1948 Act." They suggest that we should start on a completely new tack, ignoring the Monopolies Commission and surrendering all the "process of investigation" attitude which we adopt before action is taken.
That is a very tempting suggestion, and it may be that we shall come to a point where it is necessary to follow it, but I suggest to the House that at the moment, at any rate, it is premature to throw aside altogether the Monopolies Commission and the 1948 Act because, after all, the Commission are building up an experience and a "know-how" in this investigation which I think are very useful indeed.
Further, we do not want to follow the American example of constantly having to amend and expand our anti-monopoly legislation all because we passed it in much too much of a hurry in the first place. That seems to be a most undesirable course. When we do finally shoot at monopolies we want to be certain of hitting the target, and in order to do that we want to know precisely what the target is. My own view is that it would be premature to go on the American approach for the moment, provided—and only provided—we can speed up the work of the Commission very drastically indeed.
Is it possible to speed up the work of the Commission? I should like now to make two suggestions on this point. The first concerns the Commission itself. It does seem quite clear that its methods of work must be very drastically reorganised. Inevitably, it is extremely difficult for any outsider who is not seeing it at work from day to day to say precisely what should be done. My impression, looking at it from the outside, is that probably at the moment the actual members of the Commission are doing much too much of the detailed work of fact finding and of ferreting out of information.
2694 I should think that the answer was almost certainly the secretariat—to enlarge the secretariat of the Commission; because, after all, it is of a most ridiculously tiny size at the moment. I think that my hon. Friend the Member for East Ham,' North (Mr. Daines) may have something to say about this later. It seems essential to enlarge the secretariat, and then to divide the members of the Commission into two, possibly three, panels, so that, instead of the whole Commission working at the same time on one industry, we could have, say, three separate investigations all going on at the same time. I cannot believe that that is impossible to perform, and I think that it ought to be possible by this reform, this dividing up of the work by panels, to treble, or multiply even more, the number of reports the Commission is producing every year.
The second change that I think we want is on the side of the Board of Trade, not on the side of the Commission. I think that what we need here is either to give up altogether, or at least to slow down, the industry by industry approach, and, instead of concentrating on a particular industry, to concentrate on particular practices. Thus, I am sure, we could speed up the whole thing. We have got quite clear powers in the Act to do this, which, unfortunately, have not been used so far.
Section 6 (2), hon. Members will remember, permits the Commission, once the Board of Trade is satisfied that the conditions of the Act apply to the particular industry, thereafter to confine itself, if it so desires, to the investigation of a particular practice in an industry—for instance, it could take the practice of the collective boycott—and concentrate on investigating that practice in the industry as a whole, instead of producing an enormous report on all aspects of the history and organisation of the industry, where those are relevant.
So the Board of Trade instead of referring one industry to the Commission, should refer to it a group of industries, all of which were known to operate some practice—for instance, the collective boycott; and it could ask the Monopolies Commission to isolate this practice and to study its operation in the entire group of industries.
2695 Once that has been done we really could have the possibility of rather faster advance, because the Board of Trade could make use of Section 15 of the Act which, hon. Members will remember, gives it the power to require the Commission to report… on the general effect on the public interest of practices of a specified class.This Section 15 was very strongly commended by the Government spokesman during the passage of that Act, although I am sorry to say that it has not yet been used. The then Parliamentary Secretary to the Board of Trade said that as time went on it should be increasingly used and be of growing importance.
Really, this offers the only possible alternative to the very slow, piecemeal, industry by industry method, which will take generations to produce results. In fact, it really offers the only method of overcoming what, I think, is now clearly the basic weakness of the Act, and that is the fact that, if the Commission reports, say, on the supply of dental goods, and if it thinks that, in the supply of dental goods, the collective boycott is operating contrary to the public interest, the Government have no power to generalise its findings. All they can do is to issue ad hoc orders so far as dental goods are concerned, and they have no power to say that this practice, being detrimental to the public interest, must also be or will also be forbidden through the length and breadth of the industry. I think the use of Section 6 (2) and Section 15 offers the only means of overcoming the basic weakness of our anti-monopolies policy.
But it would be absurd just to suggest that we should use those two Sections without being, to some extent, concrete as to the way to proceed in actual practice. I think—and here again I think that I shall have the agreement of the House—that there has been a considerable shift in the emphasis since before the war so far as this question of monopolies is concerned.
Before the war public attention, when monopolies were being discussed, was focussed on one possible danger of monopoly—the danger of excessive prices and excessive profits and restriction of output, and, perhaps, the danger of concentration of social and economic power. I think that that was 2696 the monopoly danger on which most attention was concentrated in the prewar discussions.
I believe that in the post-war world that is not the main danger of monopoly, and not the main thing we ought to concentrate on when we consider the question of monopoly. We now have other powers to operate—quite apart from any anti-monopoly legislation—we now have other powers for dealing with those dangers when they manifest themselves. We have price control, and other Government controls, such as the control of the location of industry, and, in the last analysis—we must face the brutal fact—we have the possible threat of nationalisation.
Therefore it seems to me that this particular danger of monopoly can be met by the Government's controls, and that that is not the most serious aspect of monopolies today, and I think, therefore, that in studying our anti-monopoly legislation we ought to concentrate rather on the possible danger of industrial inefficiency and threats to innovation and industrial advance.
If, in fact, this is what we should mainly concentrate upon in our anti-monopoly policy—the question of industrial efficiency—I think that it becomes clear that the sorts of monopolies we should have in mind when we are considering action under Section 6 or Section 15 of the Act, so far as efficiency is concerned, are of two types. First, we have that type of monopoly which in America is called the trust, which we can call the industrial giant—a single firm with a monopoly or near monopoly which controls an entire industry.
This type of monopoly does not appear to be the main danger so far as industrial efficiency is concerned, because it probably reaches its position of monopoly by being the most efficient firm in the industry, and it may have quite genuine advantages merely by virtue of its size. It may not use those advantages, and possibly it may not have them, but, at any rate, the chances are that this type of single firm monopoly is not likely to present us with the most serious problem so far as industrial efficiency is concerned, though it may be that so far as concentration of power is concerned it may constitute a danger. However, my argument is that 2697 difficulties of that sort are now dealt with by other methods than anti-monopoly legislation.
But so soon as we turn to the other main type of monopoly it is quite clear that that is where the danger arises so far as efficiency is concerned, and that other type of monopoly is the monopoly of the price ring, or cartel as it is loosely called—an agreement, in other words, amongst a number of independent firms not to compete against each other. It is that type of monopoly in which we really seem to get the worst of both worlds. The price ring has not the advantages of the single firm monopoly nor the advantages of competition.
It appears to get the worst of both worlds. Certainly when we look at the examples of it in practice it appears completely to eliminate price competition; it frequently makes new entry into the industry either totally impossible or extremely difficult; it offers very little incentive to more efficient firms which want to expand in fact to increase their share of the market; and it seems to offer pretty complete protection to any firm which happened to be in the industry at the time when the price association was formed, whether inefficient or not. I therefore think that at any rate a strong prima facie case can be made out for concentrating any anti-monopoly policy on this type of ring or trade association restrictive practice. All the evidence seems to support this prima facie conclusion.
I know that all sort of different lessons are drawn from American experience, and there is no firm agreement on what American experience actually teaches us. My own belief is that all attempts at trust busting, in the sense of breaking up large firms, have been a pretty complete failure, because what happens in America is that all trusts, once they are bust, come together again like an amoeba. I suggest that the other part of American anti-trust legislation—not that part which is directed towards trust busting, but the part which is directed towards preventing price rings and market sharing agreements—has been a very striking success, and although trusts still exist, what does not exist is this great mass of market sharing agreements and restrictive practices which exist in this country.
2698 Many observers—Lewis Ord is one, whose writings will probably be known to most hon. Members—take the view that one of the main reasons for the difference between British and American productivity is the absence in the United States of many of those restrictive practices which completely stifle competition, and largely stifle free entry into so many industries, in this country. Most hon. Members will know of cases from their own experience of the effects of these restrictive practices. Certainly since it was announced that I was to move this Motion my postbag has been enormous on the subject, as hon. Members can imagine.
We had evidence in this country about these practices even before the Monopolies Commission was first set up. Quite apart from pre-war evidence, even after the war we have had the Ministry of Works Departmental Committee on Cement Costs and the Simon Committee on the Distribution of Building Materials, both of which give pictures of this type of practice in different industries. Since then we have had the first two Reports of the Monopolies Commission.
If we study these reports one thing which surely begins to stand out very clearly indeed is that almost all these restrictive practices—market sharing agreements, price agreements, the restriction of new entry, resale price maintenance, and what you will—appear to depend in the last analysis on the twin weapon of the collective boycott and exclusive dealing supported of course by their ancillary weapons of the stop-list and loyalty rebates. That is beginning to emerge more and more clearly, and I think this suggests to us the right way of now advancing under Section 6 (2) and Section 15 of the Act.
Under Section 6 (2) we should refer to the Monopolies Commission a group of industries in which these two practices are known to operate and ask for a report on those practices in those industries. Having done that, we should then ask, under Section 15, for a report from the Commission on the general effect of these practices in relation to the public interest.
If we can concentrate and canalise the work of the Commission on these two practices, which are emerging more and more as the decisive things, with all the 2699 evidence already available even before the Commission was set up, I should have thought that within some reasonable period—a year, say, or two years at the most—we should be in a position to make some general judgment on these practices, and to decide whether or not to legislate against them for the whole of industry.
It may be that this will not work. It may be that the Commission will not be able to work fast enough, or that some administrative difficulties will prevent our doing it successively. If that is the case, I sincerely suggest that we must then reserve the right to go back on the 1948 Act altogether, and reserve the right to adopt an approach much more like the American approach of going straight into general legislation. Clearly, if we can do it using the services of the Commission so much the better.
I very much hope that in this debate we can have a great deal of agreement on this question on both sides of the House. After all, we are not trying to restore the cut-throat price competition that took place in the late 'twenties. Nobody likes that, on either side of the House, and the last thing we want to do is to restore it. We do not want to restore conditions in which wages were constantly being reduced, and in which prices frequently had to be cut below the level at which overheads could be covered, and below the level at which any reserves could be built up for future capital development.
That is not the sort of thing we want. But I think it is now clear that that sort of price war, which was a product of depression and redundant capacity, is over. I do not think it is likely for a moment that this type of damaging competition will recur in conditions of full employment and buoyant markets. I therefore hope that we shall not have this brought up today as it has been in the past.
What we want to do is to restore a degree of healthy price competition, because we believe that everybody will gain and nobody will lose by it. We want to get rid of these swaddling clothes of restrictive practices in which so many industries are wrapped up at the moment. We want to let in a little air and a little light, and to reintroduce some of the 2700 impetus, dynamic and change which I think free entry and free competition produces. That is all our intention is.
I hope that hon. Members opposite will give not merely lip-service but real support to doing something effective along these lines. I am bound to say, I thought their attitude almost exactly a year ago on resale price maintenance was extremely disappointing, when they lined up behind what I consider to be one of the most damaging of collective restrictive practices that have ever been embarked on. I hope that today we shall have their support.
At any rate we on this side of the House are quite firm about this. We are very much against restrictive practices, partly on the sort of grounds I have mentioned—that they appear to stand in the way of increases in productivity and innovations—but partly also because of the very serious threat they afford to civil liberties, on which the Monopolies Commission report on dental goods speaks very strongly indeed.
There are private bodies operating over individuals controls which are not allowed by any law, and subject to no appeal to courts of law. They do this, in effect—and this is not picturesque exaggeration—behind locked doors, with no right of appeal whatsoever. This is a most serious thing, as the Monopolies Commission say in their report on dental goods. It is a serious interference with the legitimate rights of the subject to start up in business or to continue in his legitimate business. They are the methods of the Star Chamber, and we are wholly against them on the grounds of civil liberties, quite apart from the general questions I have discussed.
What I am saying really amounts to this. I believe that we must review the 1948 Act, because if we go on at the present pace there is no possibility of any effective action, certainly in my lifetime—and I say that a fortiori of perhaps the lifetime of many other hon. Members. We need a new policy. It may be that the right thing is to give up the whole Monopolies Commission approach. Personally, I suggest that it is too early to do that.
We want to re-organise the Commission, and to re-organise our approach from an industry-by-industry approach to an approach via restrictive practices. 2701 We can use Section 6 (2) and Section 15. It appears that the evidence already shows that we should concentrate on exclusive dealing and collective boycotting, because they are the base on which so many of these practices rest. If we can cut away the base the great superstructure of practices will all topple down.
I hope that the President of the Board of Trade will accept this Motion and do something about it actively in the fairly near future, because the one thing which would be intolerable would be a continuation for any lengthy period to come of inaction and passivity.
§ 11.40 a.m.
§ Mr. Daines (East Ham, North)
I beg to second the Motion.
I should like to congratulate my hon. Friend the Member for Gloucestershire, South (Mr. Crosland) first on his good fortune in winning a place in the Ballot, and then for the very able way in which he put across his case, largely from the technician's approach. I do not pretend to be a technician and I am going to talk in very ordinary terms. If we see this problem not so much in the terms of machinery but as the most important internal political question of today, namely, the cost of living, we begin to see the relative importance of this debate and what it means.
I often think that in this place, like so many other walks of life, we are inclined to develop a jargon of our own. We imagine that the cost of living is a question of figures on paper, of abstractions and of economic terms, which we have borrowed from one another. I would commend to hon. Members the very salutary practice of taking the weekly shopping basket and doing their own shopping. I remember having a discussion with my wife about three years ago, and she invited me to follow that practice. I have done it ever since. I can assure hon. Members that I have a very intimate knowledge of what the changes in the cost of living really mean.
What are we really talking about today? We are not only talking about the machinery of Acts of Parliament but we are talking about radio sets, cars, motor tyres, soap, tobacco, paint, cement, rubber, matches, electric lamps, sugar, and so on. We are also talking about some of the most essential elements that 2702 make up our industrial life and the patterns of our social lives.
Thirty per cent. of all the people employed in this country are employed in the monopoly trades. My hon. Friend referred a few moments ago to the background of these activities. With his typical modesty, he rather understated the case. What we are trying to do is to bring these things into the light of day, and to discover ways and means of tackling practices that are really a reflection of a vast economic underworld, which shuns the light of day and continues its work despite all that we have done during the last few years.
I do not want to be unduly provocative, though it is natural for me to be so, but I want to draw attention to something which should be mentioned. The biggest piece of humbug is when hon. and right hon. Members belonging to this House stand on the public platform and extol the virtues of private competition, and then in their private and business lives organise with all they have to prevent private competition by creating and running monopolies and trusts.
What is really happening is that a form of creeping paralysis is entering into the business life of this country. I am not a Manchester Liberal. I do not want to go back to the glorious virtues—and there were some—of unrestrained competition. Nor am I going to argue this morning that monopoly is necessarily wholly bad. It may be good or it may be bad; it depends on what it does and also on how it does it. We have arrived at the stage of our economic development where large-scale operations are essential if we are to have real economic success.
I do not want again to cover the ground of trade associations. I said my piece in the previous debate on restrictive practices, but trade associations are in a somewhat different category from straightforward monopolies. I do not believe that, if so-called private enterprise does not wish to compete, by using law we can make it compete. That is a complete fallacy. I recommend hon. Members to re-read the debate we had on resale price maintenance some 12 months ago.
My hon. Friend has said that in this economic underworld there is an unseen power. It is remarkable how, in modern businesses, practices are conducted, which 2703 are very similar to the practices for which people in other walks of life are today sent to prison. There are the Star Chamber, locked doors, fines and penalties. A man can be economically murdered for carrying out the very principles in commerce that hon. Members advocate both in this House and on the public platform.
Any examination of this problem shows that anti-social practices are being conducted at the expense of the public. As far as my own party are concerned, we have been most forthright about this. In the 1945 programme of our party, "Let us Face the Future," we said that the Labour Party stood forpublic supervision of monopolies and cartels with the aim of advancing industrial efficiency in the service of the nation. Antisocial restrictive practices will be prohibited.We have constantly repeated that in every one of our main political pronouncements.
We should ask ourselves very frankly whether we have, in fact, carried out the promise we gave to the people in 1945? The answer is, "We most certainly have not." What, in fact, have we done in the Monopolies and Restrictive Practices (Inquiry and Control) Act, 1948, which is now three years old? I like very much the phrase of that able economist, Professor Arthur Lewis, when he said that what we have done is to create a broomstick in order to fight a tank.
I submit that we have not touched the problem at all. I remember when we were in the Committee upstairs dealing with this Bill, when we had the help and advice of the hon. and learned Member for West Derby (Sir D. Maxwell Fyfe). There was great hope among us that we were really going to tackle this problem. What have we done? Next week we shall have before us the Dental Goods Order. What does it all mean? Out of a national industrial turnover of £10,000 million, we have only tackled dental goods and rainwater goods, which equal about £10 million.
What we are trying to do was described by my right hon. Friend the Member for Huyton (Mr. H. Wilson) when he said that we were trying to build up a system of case law based upon investigation and proceeding from individual and specific cases built up by resolution of Parliament. As my hon. Friend the Member for Gloucestershire, South said, these 2704 same powers are still very limited. Let us have a look at what we also claimed was going to be one of the main weapons, by which we were going to fight the monopoly power and bring all these practices into the light of day, namely publicity.
I ask the House this morning whether in this country publicity and the creation of public opinion on this subject has really worked. It is not working. There is hardly any awareness of this matter amongst the public. I remember after our last debate hon. Members, of this House coming to me and saying, "Thank you very much for your speech. At least I know now what restrictive practices mean." That was in this House.
The public do not understand how widespread monopoly practices have become. They really believe that when they walk down the street and see the names Messrs. Blank, Blank, Blank and Blank over the different shops that they are all competing concerns when invariably they are all tied up in one financial and economic control.
§ Mr. Daines
I do not see why the hon. Member should be so touchy. I am leaving rubber tyres alone. I will try not to provoke him again. On the question of informed public opinion, we are up against the difficulty that the Press of this country relies on heavy advertisement expenditure. I should like to say, in passing, that there are one or two honourable exceptions. I wish that the "Daily Herald" were a bit keener on this question than it is, but I should like to make the exception, in my general stricture, of the "Manchester Guardian," for the learned, and the "Daily Mirror," for ordinary people like myself. They have done really good service.
The Monopolies Act, poor as it is, depends on the drive that the Government put behind it. I submit that the Commission was woefully inadequate even for the limited function it set out to perform. It was appointed on 7th January, 1949, with two full-time members and six part-time members. Then the House became 2705 uneasy. The right hon. Gentleman the Member for Huyton, who was then President of the Board of Trade, took a strong stand, and at the end of 1950 he enlarged the Commission to two full-time and seven part-time members, of whom two have agreed to devote the greater part of their time to the work. By the end of 1950 the staff had increased to 60. There is no economist on the staff. I must admit that in other debates I have made nasty comments about economists, and I do not suppose that I have finished yet; but it is really fantastic that on this problem, which is fundamentally economic rather than legal, there is only one part-time economist connected with the Board, and that is Mrs. Joan Robinson, who is one of its members.
I find that the cost of the Commission, according to the Board of Trade Vote for 1949–50 was £32,741. Let us test these figures by comparison with what is happening in the United States of America. It is no good hon. Members allowing their foreign policy hangovers to run into this question, because it will get them all wrong. There is clear evidence that in the United States, after all their mistakes, they are getting to the stage where they are creating effective weapons to enable them to tackle this problem.
The Anti-Trust Division of the United States Department of Justice is headed by the Assistant Attorney-General. That is rather encouraging when I look at the ex-Attorney-General who is now President of the Board of Trade. I am sure that this will interest him. They employ 300 lawyers. They also employ 30 to 40 economists, which is a fact which will please my hon. Friend the Member for Gloucestershire, South. On top of that, they have a staff of 260. The total staff is 600 people who are highly trained and efficient and who have a great body of experience behind them.
But that is not all the story. The Federal Trade Commission, which carries out very similar functions, has five full-time Commissioners, appointed for seven years in order to give them a sense of security and freedom of movement, and a staff of 600, which is similar to the staff employed in the Anti-Trust Division of the United States Department of Justice.
2706 I submit in all seriousness that our method of tackling this problem is trivial. We have a total expenditure of £33,000 and employ 60 people. That is surely trifling compared with America even after making due allowance for differences in population and volume of trade. We employ 60 people against their 1,200. Our expenditure on this problem is £33,000 and we have a total industrial turnover of £10,000 million. I think that it is a modest estimate to say that the amount of monopoly trade is one-third of the total turnover in this country.
With all due respect to my own friends and comrades, whatever their position today, the plain fact is that drive has not been put behind this fight. Three years have passed. I do not want to quote the Parliamentary time-table, though I have it here. It is a most lamentable document of evasion and procrastination. I do not think that we have been serious in the way we have tackled this evil thing. We are not really making a fight over it.
What have we done in connection with the Federation of British Industries? We ask them to come along and play ball—to get all the boys at the bottom who run trade associations to listen kindly. These trade associations are run by professional people whose whole-time job is to run trade associations. They are not going to talk themselves out of their jobs as a result of hearing a few kind words.
I suppose that if I say that I have a special interest in the Co-operative movement I am likely to attract the usual diatribe later in the debate. The former President of the Board of Trade, speaking on behalf of the Government, made a very fair statement months ago about the practices operated against the Cooperative movement. Sweet words are no good at all. For the moment, I am trying to give the views of the Co-operative movement on this point. The other views I have expressed are my own.
The Co-operative movement maintains its active opposition to anti-social monopolies and restrictive practices—and, despite the statements of the former President of the Board of Trade, restrictive practices against the Co-ops, rather than diminishing, are actually increasing. The Co-ops are still barred completely from selling newspapers. The sale of 2707 newspapers is controlled by one of the most pernicious rings in the country. Hon. Members on all sides know that. The Co-ops are still barred completely from selling a whole range of other commodities. There has also been a new development as a result of which they can be supplied only at retail prices. They cannot be supplied, like the ordinary retail trader, at wholesale prices. I repeat, they can be supplied only at full retail prices. In many instances, manufacturers have refused to supply the Co-ops at all.
I believe that the Co-operative movement is the only really effective organised body of consumers in this country. I believe that the only honest approach to the broad functions of Parliament is in the name of all the people, and all the people are consumers. Therefore, I maintain that the defender of the public interest on this question must be the Government.
I cannot argue all my points fully, because that would take too long, so I will give them briefly. Present legislation is not sufficient. New legislation and new drive are essential. I am talking directly to the President of the Board of Trade, because I believe that he will do something—at least, I have hopes. New methods must be employed. I submit to him and to the Government that the present method of casual reference to the Monopolies Commission is hopeless.
I want to put to the President of the Board of Trade and to the House quite seriously that the first thing we must do if we mean business is to survey the whole field, There is plenty we can learn from other countries. I know we are a wonderful people but we do not know it all, and on this question we can learn a lot not only from the United States of America but also from Sweden, where really effective action has been taken. One of their most important weapons has been the compulsory registration of every agreement which is of a cartel or trust nature.
What a different position that would be. Instead of a hamstrung Commission controlled by a string from the Board of Trade, we would have the whole economic field covered by having compulsory registration of all agreements. That method has been highly successful 2708 in Sweden because of the publicity given in the trade papers, and quite a lot of those agreements have never been carried through after the light of day had been thrown upon them, because the Swedish people are educated in these problems.
I ask the Government seriously to consider the experience of Sweden and to make compulsory the registration of all those agreements. Then we should not be putting at the end of the business for Wednesday an Order about dental goods; we should instead be tackling in full debate the vital elements of industry that affect the whole of our lives. Therefore, I repeat that the present method of casual reference is a hopeless and quite unrealistic one. Although I shall support the Order which we are to consider next Wednesday, I do not like the individual approach.
I hope also that the House will realise what it is going to do. It is going to condemn and make illegal practices in regard to the supply of dental goods that are widespread throughout much of our industry. It is a most invidious position, a most dangerous position, but nevertheless one that I shall support. [Interruption.] Certainly. The practice is wrong and therefore it should be condemned and stopped, but I want the Government to go straight into general legislation and make all these practices illegal as well as individual cases.
I am not prepared to support the usual game by which the trust boys and the monopolists fight by delay and procrastination. The whole history of the fight against monopoly and trade rings has been to play it down, defer, and then bring legal actions again to postpone. That is always the difficulty. The people who fight monopolies are not equipped to do this kind of work. The Government should create the equipment necessary to carry on the fight. I understand to the full why hon. Gentlemen opposite find it rather amusing when I express myself in the way I do. They very often operate these very tactics I am exposing.
These practices are strangling the economic recovery of our country. I repeat what I said earlier, that we must appreciate the seriousness of these crimes against the community, and we should do with them what is done in the United States of America, and make them criminal practices. Until we do that 2709 we shall never tackle this problem. Therefore, new legislation is essential and the Government should have courage on this issue. I know how miserable is the majority of half a dozen but we should also have the full support of the Liberal Party on this problem, I know.
I know also that there are many elements in the Conservative Party, including those with whom I often argue fiercely on other questions, who are broadly sympathetic to real legislation on this matter, though I must admit that often, when I have bad dreams about nasty monopolies, I see the rather portly figure of the right hon. Member for Alder-shot (Mr. Lyttelton). Nevertheless, it takes all sorts to make a party and, after all, we are all sorts on these benches.
I want the new type of Commission I am talking about to be given real powers of initiation. Let them create a real Commission which is not controlled by a nice little string from the Board of Trade. When policy is being formulated I often wonder who does it. I can see all these vested interests moving in behind and, with all due respect, vested interests are not always those who own things. I can well imagine that civil servants do not want to relinquish power. It would be interesting, Mr. Speaker, if we could say sometimes what was really in our minds. It is often the case that power, or the desire to hold power, is a far stronger motive than the one to hold wealth. We could have a very interesting discussion on what really motivates us.
Above all things, in this new legislation for which I am asking we should have ample finance and ample staff. I do not particularly like P.R.Os., but if this job is to function properly we must have adequate publicity. In addition, I am asking for the complete abolition of the prescription of minimum resale price by manufacturers. I am asking for legislation to prevent interference with the distribution of profit by way of dividend or deferred discount on purchases, either collectively or by individual manufacturers.
It is usual, after taking nearly 30 minutes, to apologise to the House for speaking so long. I do not intend to apologise to the House, much as I respect everybody who is present. These facts needed to be stated. If I have been critical of my own Government, so be it. 2710 I am not prepared to soft-pedal on a problem which I sincerely believe to be one of the most vital economic problems of today. This is one of the fields where the fight to cheapen the cost of living could really be effective, but it can only be made effective if there is drive, fresh thinking and honest endeavour behind the fight against the evil things which I and my colleagues are fighting.
§ Mr. Speaker
There are three Amendments on the Order Paper. The last one in the name of the hon. Member for Cheadle (Mr. Shepherd), namely, in line 5, at the end, to addand regrets that His Majesty's Government have sought no means of bringing under effective review the recently established State monopolies, especially in the light of their continued failure to serve the public interest.is out of order because it is outside the scope of the debate. I am not calling the Amendment in the name of the hon. and learned Member for Chertsey (Mr. Heald), namely, in line 4, after "Commission," to insertwithout detriment to the right of persons interested to a fair and adequate hearing.because it would limit the debate entirely to these words he seeks to insert. However, I understand that the hon. Member for Gloucestershire, South (Mr. Crosland) will be willing to allow the hon. and learned Gentleman to move his Amendment formally at the end.
§ 12.9 p.m.
§ Mr. Lionel Heald (Chertsey)
I am grateful to the hon. Member for Gloucestershire, South (Mr. Crosland) for what he has said in regard to my Amendment. With your approval, Sir, and the permission of the House, I should like at a later stage to move, or to ask one of my hon. Friends to move, that Amendment so that it can be incorporated in the Motion and thus make an unequivocal statement of the view of the House on this subject.
I have been a little puzzled as to how the two hon. Members who have moved and seconded this Motion have been able to reconcile their points of view. I think they have managed it in this way: that the hon. Member for Gloucestershire, South, paid a quite kind tribute to the Commission by saying he thought they were doing their best but that they could do a little more, and the hon. Member for East Ham, North (Mr. Daines), while expressing no view on that subject 2711 at all, suggested by implication that it would be a very good thing if the Monopolies Commission were abolished altogether.
In that connection it is interesting to recall that the hon. Member for Gloucestershire, South, is much more optimistic about the Commission today than he was on 16th June, 1950, because on that date he said:I personally object very strongly to the Monopolies Commission and all its practices, because I think it does nothing effective whatever. It will obviously take so long over every report, and will cover such a tiny subsection of industry, that we shall get nowhere at all with the Monopolies Commission. It is useless."—[Official Report, 16th June, 1950; Vol. 476, c. 817.]I am glad to think that he has gained a little better information on it now. I think all my hon. Friends on this side of the House will be in agreement with the mover that we should make the 1948 Act effective. It was substantially a non-party Measure in its essence, and we are in favour of speeding up proceedings if that can be done. Therefore, I follow him in that and repay the compliment he was good enough to pay me by saying that we are in agreement with that. I do not find myself running on the same lines as the seconder, because I do not know quite what his attitude is in regard to the Commission.
§ Mr. Daines
I spoke for 15 minutes making clear, at least to myself, that I wanted the Commission reconstituted and I repeat that I want it reconstituted. I am sorry that my efforts at making that clear to the hon. and learned Gentleman were unavailing.
§ Mr. Heald
The hon. Member wants the powers altered, but I think his hon. Friend will agree that the powers are perfectly adequate but that it is a question of the machinery by which they should be exercised. That is important. I want to make my position clear. While I have no interest in the technical sense, it is right that I should say that I have appeared before the Monopolies Commission. I am concerned in advising others than those for whom I appeared on the first occasion, but I can say in all sincerity that I shall not say a word that I have not already said to them and will say again if I get the opportunity.
2712 The hon. Member for Gloucestershire, South, has already made clear that he realises how important it is that there should be no witch hunt or anything of that kind involved in this procedure. I am not quite sure about the seconder. At present, as we heard from the speech of the seconder, one has to recognise that with prices high and rising there is a temptation to blame the monopolies, cartels, rings and all the rest and to use them as scapegoats for the cost of living increase.
I want to be moderate and reasonable in this matter today, and therefore I will adopt the moderate and reasonable language used by the President of the Board of Trade in a speech he made which was reported last week-end, when he said in effect—and I hope I shall not misquote him—that we may be able to do some good by the proceedings coming out of the Monopolies Commission in preventing prices from being excessive, but we must not think that by that means we can do anything very substantial towards affecting the general rise in the cost of living.
I think that was a fair and reasonable statement which could well be commended to some hon. Members of his party, who also have made speeches recently, for it is not only misleading but highly dangerous, I suggest, to have any kind of public feeling on these things being investigated by the Monopolies Commission. It is dangerous and misleading for the public to think that here is something which will really bring down the cost of living. It is likely to produce the sort of panic action which always results in injustice.
History is full of examples of that kind of thing when public opinion—or rather ignorance—is inflamed. We get the atmosphere of the witch hunt and the Reichstag fire trial and that kind of thing. Some hon. Members may remember the famous description by Carlyle of the French Revolutionary Tribunal in which he described it as:That strange court of wild justice to whom law is no law and killing, by what name soever it is called, is but work to be done.That is a rather formal way of describing it, but perhaps the best description in our language is to be found in Lewis Carroll. Everyone will remember the Trial Scene in which the King kept interrupting the 2713 proceedings by demanding sentence first and verdict afterwards, and the Queen was even more direct by constantly saying, "Off with his head." That is a definite danger, and it is the duty and privilege of every self-respecting lawyer to resist that tendency, that mob psychology, however unpopular it may be. It has frequently been said that one of the reasons for the unpopularity of lawyers is that they have an unfortunate habit of bobbing up when one has made a decision too hastily on wrong lines and pointing it out.
I wish to acknowledge that the mover, I am quite certain, has that fully in mind. Unfortunately, there are others who have different views, and it is most important that this House should make the point clear. I again emphasise the other side of it; we must not turn the Monopolies Commission into a law court. That would be entirely wrong, but it is an even more dangerous thing to have the risk of a revolutionary tribunal, I am quite certain that we have every safeguard in that direction from the Board of Trade.
As this is the first occasion so far as I am aware in which the right hon. and learned Gentleman has taken part in a debate since his appointment, I think I would be justified in saying without impertinence that both branches of the legal profession would like to tender congratulations and best wishes and hopes that he will not have an undue strain on his health and strength in his new and very arduous office. We can be quite sure that in the last few weeks since he left his previous office he has not left behind him those great principles which we all consider to be so vital and which have made British justice the admiration of the world.
Some hon. Members may not appreciate the tremendous burden which is laid upon the Commission, both moral and physical, in their work. If we say "speed it up"—by all means let us do everything we can in that direction—do not let us underrate the difficulties. I should like to shed a practical light on that. We decided that there shall be no limitations on the expression, "public interest," in the Act. There is in Section 14 a guide as to certain considerations which should be taken into account, and it goes on to take that all away again by saying, "and 2714 every other relevant consideration." The matter is left at large.
Take a particular case of which I have knowledge, where about seven huge organisations have been working together in an association for the last 30 years, and we have to go into their history and examine it. Some may say, "Why go back?" I would point out that if we do not there would, in many cases, be a danger that some of the objectionable practices might go scot free; because if we confine our attention to the present and said, "They are not in fact operating at this moment to the public detriment, leave them alone," we may very well be letting out something very dangerous. If we look in the past we may find they were originally conceived with the idea that they might produce a certain result, and it is possible they might produce that result again in the future. That can be ascertained only by inquiry.
In the dental report it was stated very plainly by the Commission, at page 66:We are not asked to say whether the conditions have in the past operated against the public interest, but whether they do so now or are likely to do so in the future. We have felt that one of the most important guides in this task must be the use and effect of the industry's practices and policies in the past and we have, therefore, described these at length.In order to investigate them a tremendous task was imposed on the Commission. It is no exaggeration to say that a three-ton lorry was required to carry the documents the Commission actually examined. But that is nothing, compared with the documents investigated in these various organisations by the hard-working and very much strained officials of the Commission, who must have gone through a tremendous task in examining all those things and producing papers.
Then there are also the complaints sent in from the public, and there are back-stairs informers who come into this matter. Sometimes I regret to say even Members of Parliament put up complaints which have to be investigated. It may turn out that they are thoroughly unfounded, but it means a great deal of time has to be spent in investigating them. There are others who know much more about it than I but it would appear that in the United States, where they have got this down to a fine art, it still takes from two to three years to prepare 2715 a case for trial under the anti-trust procedure. So in order that the thing should be done properly, both for the "prosecution" and the "defence" as it were, a tremendous amount of work has to be done.
By all means let us see if we can speed up the machinery, but do not let us underrate the magnitude of the task or think that there is any short cut. Do not let us leave the Commission out of the question. We should consult them, because after all they may have some valuable suggestions. I would pay a respectful tribute to the Commission itself. They have made every possible effort and, I would say, have succeeded remarkably in making a Star Chamber type of procedure fair and equitable. One has to remember that it is much like the procedure of continental courts, where a person is brought before the court and no accusation is made against him. It is, as it were, brought out from him and then held up in his face.
The Commission has appreciated that, and developed a system whereby, after a certain period of interrogation, they produce what has been called provisional inferences. Then the party is given an opportunity of dealing with those inferences by evidence and discussion, and, if he can, of showing they are not justified. I do not think I should be saying anything improper if I said that in at least one case it has already appeared that that procedure was very wise and just, because, if there had not been an opportunity for dealing with the matter in that way, it might have been that a very wrong inference would have been drawn.
I cannot properly discuss the question of the constitution of the Commission and its staff; I do not feel it would be consistent with the position I have the privilege of occupying of appearing before them as counsel. That is really a matter for others to deal with. But I believe that it is fair to say that the staff, who have I am sure done most devoted work, do need some help. They have a colossal day's work, and they must wonder how they are to make progress without some more help. I do not believe we should regard this as a hopeless task in which we shall not get any result, and I was pleased that the hon. Member 2716 for Gloucestershire, South—he did not actually say it specifically, but it was clear, I think, from what he did say—felt that this machinery could work.
I think it desirable that we in Parliament who agreed to the Monopolies Commission as a suitable instrument should do our best to make it effective and make it work, and should not adopt the hopeless attitude that we shall never get anywhere with it. We on this side of the House will be prepared to help in that respect, but we must be careful to see that those who come along with ingenious ideas for speeding up the procedure do not debase the standard of British justice.
So far as concerns the other matter I raised in my Amendment, it is, I think, agreed between us that it is not much use just talking about whether legislation can physically be brought in until information is available. There I think we are in agreement, because the hon. Member for Gloucestershire, South, as I understood him, did seem to feel that further information was required in relation to those matters with which he was particularly interested. My attitude about that might be summed up in a proverb I was brought up on in Lancashire. I do not know whether it applies in the South. I used to hear from my father that it was a mistake to keep a dog and bark yourself. I think there is a lot to be said for that. Let us use the Commission and help it forward in every way; and it may be able to tackle the evils—we admit they are evils—which exist and which must be diminished.
§ 12.27 p.m.
§ Mr. Edgar Granville (Eye)
We are all indebted to the hon. Member for Gloucestershire, South (Mr. Crosland) for having introduced this debate today, and also for the very able speech to which he treated us and his exposition of a very difficult and complicated subject. Those of my hon. Friends who did not have the opportunity of hearing him would be advised to read his speech closely in Hansard. We also enjoyed the speech of the hon. Member for East Ham, North (Mr. Daines) who suggested the force and the vigour which we on these benches think necessary to get a real move on with this very difficult problem. When he said that the Government could count on the support of these benches, he was stating an accurate fact.
2717 As the hon. Gentleman said in his speech, this is an extremely complicated and difficult problem. It is not one for which we can produce a ready made solution. It is a world-wide problem, this big-scale organisation or big business or large concentrations, and it is prevalent and fashionable in most countries in the world. The position of the small producer is extremely difficult. There are many economists, both in the United States and in this country, who think we shall see a revival of the small economic and efficient unit, provided the Government are prepared to give the valuable facilities for research and matters of that kind which are denied to the small efficient unit. It is possible that we may see the breaking up of these large-scale organisations provided that we can get intelligent co-operation from the Government.
When we talk about private enterprise and public monopolies we often forget the steel industry. That was in no way a beautiful piece of private enterprise before it was nationalised. It is also forgotten that civil aviation was made a monopoly by the Conservative Party when they were in power before the war and there are other cases. It is not easy to come along now and say that all these things can be dealt with by comparison between private enterprise and public monopolies.
One of the things with which we have to deal today is the practice and tendency of large-scale organisations. I could give many illustrations of this. Let us take the illustration of the shortage of raw materials. We have what amounts in effect to an overwhelming advantage for the large-scale organisation, which is able to go to the supplier and say, "You must give us first call on this." In the case of some industries, unless one was in the industry before the war, one cannot get supplies of raw materials at all.
If the shortages of vital raw materials continue, we shall have to consider this aspect very seriously. Now that shortages are appearing, some of the former opponents of rationing are demanding rationing so that small units may get fair shares in spite of the overwhelming buying power of the large-scale business organisation. We have heard of the need to encourage people to come in and risk their capital, but who can set up a chemist's shop next to I.C.I.? Who can compete against some of the present 2718 industrial practices? Who can compete against effective control by price rings, unless this House provides fairly strong safeguards. If monopoly tendency and practice are continued in the case of agriculture, the food production of this country can be controlled.
The Liberal Party looks for a solution of the problem along Liberal lines. We have a very good record on this. We have done a lot of thinking about it and we have given a great deal of time to the subject in our summer schools, discussions and so on. We put a Motion relating to it on the Order Paper in 1946 and in March this year we had another Motion about it. Also, I recommend the right hon. and learned Gentleman to read a pamphlet called "Monopoly," which I have here which contains a study of the problem by the Liberal Party and a recommendation about dealing with it. I thought that the hon. Member for East Ham, North, must have read the document when I heard him demanding more vigorous action, and I also hoped that the hon. Member for Gloucestershire, South, might have read it when I heard him say that we must canalise and redirect our effort on the basis of general principle rather than of specifying an industry.
We welcome the Motion. No doubt the Government will accept it. I believe that the Government will not be unfriendly to the Amendment. However, as we are overwhelmed from all parts of the House with offers of support, I begin to wonder what is really behind this. There is danger in delay and danger in paying lip-service to these ideas and becoming a mutual admiration society instead of taking effective action. I am sure that if the Conservatives were dealing with this they would shelve it. The Conservatives have never been very fond of dealing with monopolies. I am sorry that we are not today to hear another speech from the right hon. Member for Aldershot (Mr. Lyttelton) on this subject.
I believe that the Government should take action and deal with the matter now. My hon. Friends and I assure them of our support in that. I do not know how long it would take to carry out an effective reorganisation of the Commission in order to get better work from them. It might take two years in the U.S.A. At all events, let us begin it.
§ The President of the Board of Trade (Sir Hartley Shawcross)
The hon. Member will recall that in the U.S.A. criminal trials which we should dispose of in six months sometimes take six years.
§ Mr. Granville
I am sure that the right hon. and learned Gentleman would improve upon that. We expect great things from him. We believe that he is one of the successes of the present Government and we hope that he will meet with success in this problem. My hon. Friends and I will give him our support in tackling the subject more vigorously.
In the matter of resale price maintenance, the emphasis is upon the trade association or monopoly. It is unwise for the Commission or anyone else to condemn out of hand all these price fixations. The place to deal with this is where we have a trade association working effectively as a monopoly. I hope that that is how the Government will deal with the matter. We ought to bear in mind that by placing under public control a large monopoly industry we have not completely solved the problem.
I do not believe that the Conservative Party would de-nationalise these nationalised industries. I believe the nationalised industries are here to stay. We cannot unscramble the omelette. This presents a challenge to the Government during the next two or three years of their period of office to approach the reorganisation of the nationalised industries afresh. It is necessary, insofar as they are monopolies, to start very much from the beginning again. They might or might not come under the survey of the Monopolies Commission. I believe that the Government would have much support in tackling the problem now with a two- or three-year programme on the basis of reorganisation where experience has proved this necessary.
The Liberal Party welcomes the debate. There is no doubt that the whole House will support the Motion, and I hope that when the right hon. and learned Gentleman replies he will tell us that the Government will take fresh and more effective action.
§ 12.40 p.m.
§ Mr. Tomney (Hammersmith, North)
The hon. Member for Eye (Mr. Granville) referred to the fact that the Conservative Party, if returned to power, may not want 2720 to de-nationalise the nationalised industries. I do not think it should pass without comment that we have it on record that the right hon. Member for Woodford (Mr. Churchill) has already said in regard to steel nationalisation that he would rescind that Measure immediately he came to power. I am of the opinion that he would do the same with regard to transport, so do not let the House be under any misapprehension concerning those two things.
The problem raised by my hon. Friend the Member for Gloucestershire, South (Mr. Crosland) this morning, in a very interesting speech, would take perhaps the best part of a month to debate fully. The ramifications of monopoly companies throughout the world and their effect upon the national policies of different countries are so wide that a debate of this character cannot possibly give full justice to them. Nevertheless, I think the House is indebted to my hon. Friend for raising the matter.
Since the inception of trade associations and monopolies, round about the beginning of this century, the situation with regard to them has considerably changed, particularly in this country owing to the advent of the Socialist Government. It was bound to change. The problem of monopolies against a background of changing world circumstances, the restriction of markets, the cessation of markets behind the Iron Curtain, rising world standards and full consumer demand is something which, in a way, will lead to self-solution. For instance, we cannot have restriction of supply at a time of rising world standards and great consumer demand. It would not do.
Monopolies were formed in the days when unemployment was rife throughout the world, when markets had to be protected, and when prices had to be established. Therefore, that problem, in so far as it can be judged on an international basis, can be tackled successfully only by international action. The world is crying out for goods, and it would be wrong for any nation to allow monopolies to restrict supplies.
My hon. Friend and other hon. Members have dealt with the point concerning the speed with which the Monopolies Commission works. I am probably the only Member of this House who has given evidence before that Commission. I know how it works. When I was ex- 2721 amined regarding the electric lamp industry, my examination took about one and half hours. As far as I know, the Commission cannot demand the presence of witnesses in regard to any particular sector of that industry.
My hon. Friend mentioned dental and rainwater goods—two small items of minor industries which have been examined. But if by inquiry we can get a full picture of the electric lamp industry, or, for that matter, the radio bulb ring, then we shall begin to understand how this monopoly operates, what price-fixing arrangements are made, and, more important still, what wage-fixing arrangements are made within the industry to the detriment of trade unionists, a point with which I will deal later.
But before the Commission could get a clear picture of this industry, it would be necessary, for instance, to call in people with scientific knowledge and with knowledge of patents and of technical advance to give evidence. As far as I am aware, the only body in this country which could give evidence on such points is the Association of Scientific Workers, and so far it has refused to do so. That shows the difficulty of the Commission. Unless they can get a clear picture of the whole set-up, their inquiries cannot be conclusive, and the fact that up to now they have been unable to get such a picture is one of the reasons for this delay.
I do not think that difficulty can be avoided in its entirety, because, by and large, the technical people engaged in the industry are under contract, and are bound by certain terms of employment specifying certain conditions, one of which, I imagine, is that they are prohibited from giving evidence before the Commission. Unless, therefore, the Commission can demand their presence, I can see no tangible results coming from investigations into the electric lamp industry.
The position as it affects the workers in monopoly industries is rather difficult, because there is a complete tie-up in the manufacturing industries, and especially in the lamp and bulb ring, with regard to wages, prices and conditions. Any wage award, for instance, operates on the same basis throughout the whole industry. The wages paid by, say, the E.M.I., one of the firms of the right hon. Member 2722 for Aldershot (Mr. Lyttelton), are exactly the same as those paid by the General Electric Co. or the Marconi and Osram Bulb Co.
I know of instances of skilled technicians being told, on applying for employment with other companies in the industry, that it would first be necessary for them to secure their discharge from their present employers before their applications could be entertained. But how can men bargain freely in such conditions, and when they have first to terminate their employment with one firm before they can apply for employment with another? There are five grades of technicians in the industry. The position is quite impossible and it does not make for happy relations in the trade.
The industry is completely protected. When certain capital plant is laid down, it has to be paid for before new plant is introduced. In consequence, as the plant is moved out, efficiency becomes less and the workers' wages drop. A man can move from one firm to another, but he will get exactly the same rate of pay wherever he works. That is wrong, because it penalises incentive and industry. The reason for it is that the industry as a whole have guaranteed markets throughout the world. They are sure of their income, and they have no great desire to expand. But in a world which is crying out for consumer goods, that is something that will have to be changed as quickly as possible. It cannot be allowed to continue, and that is why the Labour Party have done something which has been the base on which these things are built, and that is why there is going to be a change before very long.
The same conditions operate with regard to piece-work. In one paper firm that I know, the wages computed on the operations are so broken down on a cost basis that they are assessed to within three decimal points. What chance has the ordinary wage earner of computing or estimating his wage on that basis? And that operates from one firm to another. We shall certainly have to look into it.
The lamp ring are strongly represented on the committee of the British Employers' Confederation and through that representation are able to determine what wages shall be paid throughout the 2723 country. I know of instances where a firm has so increased its efficiency that it has applied to the Confederation to allow it to increase wages to attract labour and that has not been forthcoming because it would upset other wage arrangements within the ring. That is wrong and must not continue. But the lamp bulb representatives on the Confederation are in such a powerful position that in fixing wages for this industry they are fixing wages for every other industry in the country. We, as a Labour Government, should be prepared to look at this practice and many others.
I believe that because of its construction and character the Monopolies Commission cannot go ahead faster than it now does. I believe the suggestion of my hon. Friend the Member for Gloucestershire, South, of a secretarial investigation committee to hear evidence and present it to the Commission is something which will speed up matters. But if everyone were treated as I was, or evidence is not forthcoming from people in industry, we shall not get anywhere for a long time.
Today's debate is to be welcomed. I believe there is a measure of agreement on both sides of the House and that, therefore, the Board of Trade should try to find means to enlarge the scope of the Commission and speed up its operations.
§ Mr. John Foster (Northwich)
Is the hon. Member saying that he gave evidence about wage structure and about the electrical lamp industry before the Monopolies Commission?
§ Mr. Tomney
Yes. I am glad the hon. and learned Member has interrupted me. My evidence was not accepted on the point. They took the details. I was accompanied by two union representatives. When the interview was over the union representatives were asked if the union would accept my evidence in its entirety. As I was a specialist in my particular job the officials could not answer, but they said they would collect evidence from other people in the industry who were in union membership without my knowledge and submit my evidence to them for confirmation or otherwise. They did that and my evidence was confirmed by people in the industry. It went forward and was accepted by the Commis- 2724 sion as evidence. That shows how careful the Commission have been and, of course, they have to be careful. But that work could have been done by the committee which my hon. Friend the Member for Gloucestershire, South suggested should be set up.
§ Mr. Tomney
No, I do not. This debate is taking place on a Motion before the House. The implication in the speech made by the hon. and learned Member for Chertsey (Mr. Heald) was that he was in favour of delay. We are not.
§ Mr. Tomney
As my hon. and learned Friend says this a political, not a judicial, matter. I cannot foresee any conclusion to the investigation unless people are prepared to come forward to give evidence and the difficulty is that when they come forward it may be held against them that they have committed a breach of contract. That is a matter for the lawyers to decide.
As for trade practices within a firm or a group of firms, I do not know what prices operate, but I know that one company's goods are manufactured on the same premises as the goods of other companies, and the same goods are merely stamped with the nameplates of different companies. Mazda manufacture the same goods with Osram and Marconi and Siemen's, and so on. All types of telephone lamps supplied to the General Post Office are manufactured by the same firm. I do not know what price arrangements are made but the examples can be multiplied a hundred times.
Prices are not a measure of efficiency when the market is rigged in favour of the producing company. That is what we have to combat most strongly. Rising standards of living throughout the world are creating a demand which must be met and restrictions of output in any direction cannot be tolerated. If that proposition were accepted the worst features of monopoly would disappear.
2725 The economic situation has changed, the geographic boundaries of countries have changed, and some markets have contracted; but we know that, with rising standards of living, the demand for consumer goods is insatiable and should be satisfied on the basis of the greatest efficiency at the least possible price. The market should not be rigged against the consumer.
We are dealing at the moment only with secondary trades. We are dealing only with dentures and rainwater goods, but the radio valve industry, for instance, has ramifications all over the world. If the Monopolies Commission have powers to demand certain witnesses I suggest to my right hon. Friend the President of the Board of Trade that—
§ Sir H. Shawcross
I am loth to interrupt my hon. Friend but the Commission have power to summon witnesses. Whether they would get frank and free evidence from all the witnesses they summoned is a matter on which my hon. Friend has made a point; but they have the power to summon.
§ Mr. Tomney
In that case it depends on the good will of the monopoly industry, and that is another matter. If we tackle this problem in the right way and support the Motion of my hon. Friend the Member for Gloucestershire, South in its entirety and without dissension in the House, we shall have given a lead in impressing upon the monopoly industries that the wishes of the consumer must come first.
§ 12.58 p.m.
§ Mr. Leather (Somerset, North)
I rise to continue the debate in this air of goodwill and agreement on all sides of the House that monopolies and restrictive practices are a bad thing. There also appears to be a tacit agreement that nobody is going to do anything about it. I feel that my hon. Friend the Member for Gloucestershire, South (Mr. Crosland)—if I may refer to him as my hon. Friend as he and I are separated on this question by nothing more than our labels and the River Avon—has done great service. I feel very strongly that general legislation on this question is long overdue and that it is long past the time for the Government to grasp this nettle and do something about it.
The debate has done an immense amount of good in clarifying, as the hon. 2726 Member for Gloucestershire, South, so ably did, what actually constitutes a monopoly practice. In doing that he has completely defeated many of the arguments in favour of delay, going slow, and not tackling too much, and so on. He illustrated very clearly that the term "monopoly," used in the political sense, is a generic term which covers a great many things which strictly speaking are not a monopoly at all.
The technical word is, I believe, "oligopoly," which is much more prevalent and serious. I use the term monopoly for the sake of convenience to cover oligopoly and all kinds of restrictive practices in restraint of trade. I have always thought that actions in restraint of trade were bad and should be stopped. I think it is a great pity that the stopping process was not taken in this country many years ago. Now we are in the happy position in which we can all blame both our Front Benches because they both had plenty of time and have not done it yet, so there is no party kudos in this statement.
I believe that nothing but good, healthy competition is going to play its part in getting prices down in this country. The hon. and learned Member for Chertsey (Mr. Heald) argued that it was wrong to suggest that monopolies or big businesses were keeping up prices, or that there could be any drastic cuts in the cost of living. Of course, he is quite right; no one is suggesting that it is going to make drastic cuts, but I think that it could make appreciable cuts in small places.
We have today the unique situation that for the first time in 50 years really healthy competition seems to be welcomed from both sides of the House. Having always believed in healthy competition, I welcome those converts. We have had many industrialists, as the hon. Member for East Ham, North (Mr. Daines) said—and I agree with nearly every word that he said—who constantly paid lip service to free competition but never practised it. Most of the Members of the party opposite have never paid lip service to free competition. They have always suggested that it was bad. I do believe in it, and I am delighted to find from both sides of the House that the idea of healthy competition is now beginning to become very strongly held. If one believes that healthy competition 2727 is good and is an essential mechanism of the running of a free economy, one is forced to the conclusion that collective practices to eliminate competition must be wrong.
In my view, both management and labour in this country are riddled with restrictive practices—absolutely riddled with them—and I think that is frightfully important at the present time when we are told by the Government, and it is generally agreed, that nothing but a great upsurge of productivity and efficiency is going to save the country from bankruptcy, finance re-armament and do all the other things which we want to do. In these circumstances, anything that restricts productivity or efficiency is against the national interest. That is why I think that this debate is very important.
It is estimated, and I believe fairly, that today the country is losing in restrictive practices goods to the value of over £1,000 million a year. When we are crying out for productivity, over £1,000 million worth of goods a year are being lost in restrictive practices. I think that it is fair to say—and I say it as a trade unionist—that the trade unions are probably responsible for the biggest bulk of that restriction; but the function of management is to lead, and until management has put its house in order it is no use whatever appealing to the trade unions to put their house in order.
As a trade unionist that is my answer to the management. Management talk a lot about enterprise. The trade unions say: "You show the enterprise and then you can come and talk to us, but not until you have shown it." That is why I feel that it is essential at the present time that management at all levels should show good faith and show willing and give a direct lead in efficiency and production.
The report "Trade Unions and Production" states:Competition in the U.S.A. exists in fact as well as in theory. It is this pressure of competition which compels managements to be progressive.What we have to do is to convince the trade unions that we have competition in fact as well as in theory. As a trade unionist I am not convinced, and I hope to give one or two illustrations as to why I am not convinced. My right hon. and 2728 learned Friend the Member for Liverpool, West Derby (Sir D. Maxwell Fyfe) wrote an excellent book on this subject three years ago. One thing he said which struck me as eminent good sense, as is everything which the right hon. and learned Gentleman says, was:Other British dominions have passed laws against trade restraints though none are as complete or effective as the Canadian law.I am sorry to see that my cousins in the States are being held up as paragons all the time. The Combines Investigation Committee in Canada has worked extremely well. I know that my legal friends can ridicule prosecutions under the anti-Trust Acts of the U.S.A., and that it is easy to get up and point out anomalies and loopholes, but I do not think that is relevant. It is so easy to attack monopolies in general, but it is even easier to defend them in particular. That is precisely what has been happening for many years. Everybody says "It is a very bad thing, but when you come to my industry that is different." I do not believe that it is different. I believe that this whole atmosphere of collectivism has been bad for the country.
Reference to this has been made in Lewis Ord's book "Politics and Poverty," and I will give an extract from it. He gives statistics which I think are of great interest. He points out that in 1815, which is a good starting date as being the end of the Napoleonic wars and when the Industrial Revolution was getting under way, that the real wage standard on both sides of the Atlantic was precisely equal. By 1890 it was still precisely equal but had progressed on both sides by 300 per cent.
When we look at the graph from 1890 onwards, the thing goes wrong. In 1914, the North American real wage standard had increased to 600 per cent. and ours to only 400 per cent. By 1939, it had increased to 1,200 per cent. and ours to only 800 per cent. Ever since they have continued to advance at ever-increasing rates. If we look at the graph as it is at present we see that the American real wage standard is nearly double ours. The critical date on the graph is 1890.
§ Mr. Tomney
The ratio of figures which the hon. Member has given seem to bear out that it is about equal to the difference in horse-power of workers in 2729 this country and workers in the United States—a difference of six horse-power in the figures seems to work out accurately.
§ Mr. Leather
I think that is highly relevant. Surely the interesting thing from an objective standpoint is to see what happened in 1890. What happened is perfectly simple. In the 1890's Canada and the U.S.A. made their first halting steps towards making competition the law of the land. It was precisely at the same time that the managements, trade unions and politicians in this country started to preach collectivism and started to get together to curtail competition. I suggest that the two things are clearly relevant and must have some close connection. Therefore, when we are considering on both sides of industry productivity and real wage standards of living, I suggest that it is relevant to consider restrictive outlooks and collective outlooks in industry as part of that picture.
I urge upon the Government that the time is long overdue when general legislation is necessary on particular issues. The hon. Member for Gloucestershire, South, pointed out that legislation on these issues was obviously needed and should be introduced. I know that some of my hon. Friends argue that we must not do anything until the Monopolies Commission have made a lot more reports so that we have more experience of this problem, but I say in all sincerity that we have had far too much experience of this problem already. That is what we want to stop. We do not need any more experience to enable us to prove precisely what are trade practices which restrict output and keep up prices. Everybody knows what they are. By all means let us strengthen the Monpolies Commission and give them more staff and everything which is needed, but I still say that that is not going far enough.
Perhaps I may refer again to the book of my right hon. and learned Friend, in which he says, on page 49, that in his opinion,Devices to restrict output below the demand at a remunerative price or to keep inefficient firms or factories in being should not be allowed to stand unchecked.I suggest to hon. Members of my party that there we have a clear statement of policy with which we should all agree, and I suggest that it is a very good 2730 criterion to apply to these matters. Under that criterion I would list, as did the hon. Member for Gloucestershire, South, price rings, collective boycotts, loyalty rebates, restrictive agreements—all things which restrict trade. That is the whole object of them. Personally, I agree entirely with what the hon. Member for East Ham, North, said about providing that agreements should be registered with the Board of Trade. I did not think he stressed his case sufficiently strongly. The trade unions have always had to register their rules with the Board of Trade—the Registrar of Friendly Societies; why should not trade organisations have to do the same thing?
§ Mr. Douglas Houghton (Sowerby)
Trade unions nave to register their rules but not their agreements.
§ Mr. Leather
I think perhaps we are confusing each other in the terms we use. I agree that the rules of trade unions have to be registered. I am not referring to their wage agreements, but to the rules on which their organisation is drawn up—the code of behaviour, and so on. Whether we call it their rules or their agreements does not matter.
§ Mr. Leather
I entirely agree, but with great respect that has nothing to do with what I am saying. I was trying to support what was said by the hon. Member for East Ham, North, and I had hoped that the hon. Member for Sowerby (Mr. Houghton) would help me rather than divert me from the subject, unless, of course, he disagrees with his hon. Friend.
§ Mr. Houghton indicated dissent.
§ Mr. Leather
I am glad to see that he does not. The point I was trying to make is that if trade unions have to register their rules, then there is no reason why trade associations should not have to do it also. I should like to hear the views of the President of the Board of Trade on this. Could I put a direct question to him? Would he give his views about making trade associations register their rules, their code of conduct? It has been suggested that we could go so far as to prohibit trade associations from making price agreements at all. Personally, I should like to do so, but I should first like to know the President's views as to 2731 whether he thinks that is practicable or not.
One argument advanced by some of my hon. Friends is that competition in price is only one kind of competition and that competition in quality and service is also very important. I must confess that my mind is not subtle enough to appreciate that argument. I have no doubt that competition in quality and service is important, but competition in price is much easier to understand; it is a much clearer measure of efficiency and a much clearer safeguard against either feather-bedding or unearned profits. Therefore, while I am prepared to admit that competition in quality and service is frightfully important, I cannot see that there is any argument for saying, "It is quite all right to compete in that respect but you must not compete in price." That seems to me to be a contradiction in terms.
I do not pretend for one moment that all industrialists who carry out these practices are rogues and are dishonest. I know perfectly well that they are not; I know many of these men and have talked with them, and I know them to be perfectly sincere and honest citizens. But I urge them to examine themselves and their practices in the light of 1951 and not constantly in the light of 1921. We are always hearing about the dreadful things which happened in the 20's and the fact that only their trade agreements and rings ever put them right. I cannot believe that that is true. They say, "In 1921 there was cut-throat competition of al kinds and dreadful things happened. We formed our rings and restrictive agreements and everything got better."
Perhaps I may put this to the people who use that argument. If it was because of rings and agreements that everything got better, how can they explain that in countries like Canada and the United States, where rings and agreements were illegal, things not only got better but they got a great deal better than they did here and they have gone on getting better ever since.
The fact of the matter is that the general terms of world trade improved. Pari passu with that, in this country industry introduced these restrictions, but in other countries, where those agreements were illegal, conditions of trade improved just the same and, in fact, to a greater degree than they did here; and 2732 surely that is a fact which any fair-minded person must face and not simply pass off with a shrug.
Many hon. Members could give illustrations. I have had dozens and perhaps I might be allowed to give one or two from my recent experience. There is a price ring in spark plugs. Four firms have held the entire market and have successfully prevented entry into that market for nearly 25 years, until only a matter of a few months ago. Nearly every wholesaler in the industry is tied to those four firms by a selective agreement—I have some copies here—which says quite clearly, "You may deal only with people of whom we approve and you may deal only at prices which we approve"; and of course, they say, "We do not approve of anybody who is not willing to sell at our prices." There hon. Members will see a price ring and a selective agreement, and it is all backed up by a collective boycott. Its sole purpose is to keep prices up; there is no other purpose.
What has happened is that a small company, Wico-Pacy, have been fighting for a long time and have produced a spark plug which they can sell far cheaper than the ring price. The ring say, "No, you can come into this business only if you sell at our price," because they know perfectly well that a new product at the same price has not a hope of selling against an established advertised product. That is the way in which they have been able to seal the ring and to restrict output. That is precisely the test applied by my hon. and learned Friend the Member for West Derby; they do not restrict their own output, but they restrict total output by preventing other people from producing at all.
The fact of the matter is that the spark plug in this country is very nearly the highest priced in the world. A spark plug which one buys from a garage for 5s. can be sold to the motor manufacturers for 1s. or even less. I am quite prepared to admit that large orders will always command a smaller price, but not 400, per cent smaller.
§ Mr. Tomney
Perhaps I may refer to the lamp industry, where the case is even worse. The manufacture of tungsten wire is vested in one company. It is a very expensive process and goes through a number of diamond dies. They regulate 2733 the output and decide who can have it. During the war, when it was necessary for the G.P.O. to have a fully supply of telephone lamps, a small firm were given a contract but they had difficulty in obtaining these supplies even in war-time. That is the sort of thing which is taking place.
§ Mr. Leather
I am grateful to the hon. Member. I think all of us could give a good many dozen illustrations of the same kind of thing. In the battery world the position is even worse. The Varley Accumulator Company have been trying to put a battery on to the market for ages. There the position is even worse because not only are the wholesalers tied up but the retailers as well. My spark plug friends have succeeded in breaking the ring because they were big enough to find the capital to organise their own distribution and to forget the wholesaler, but in the case of batteries there is not even that safeguard, because all the retailers are tied up, too.
I do submit that these are methods for maintaining closed shops. Thank heaven, in this House—and on all sides of it—we have agreed, after our recent incursions into the affairs of the Durham County Council, that we do not like closed shops. If we make closed shops wrong for trade unions, then closed shops are wrong for employers, and surely nobody can possibly maintain the opposite conclusion. It seems to me to be a principle, and we must maintain that principle.
By these devices these monopolies have kept closed shops for many years. Their practices, selective agreements, rebates, and so on, are perfectly well known to all of us. We do not need dozens more investigations and reports to tell us what we already know. They are merely means and devices for delaying action that is already long overdue. I hope very much that the right hon. and learned Gentleman will tell us that he is going to grasp this nettle, and I can certainly assure him—indeed, it has already been said—that lots of people over here will support him most strongly.
§ 1.21 p.m.
§ Mr. W. T. Williams (Hammersmith, South)
I listened with very great interest, if also with some alarm for his sake, to the speech which has just been made by the hon. Member for Somerset, North 2734 (Mr. Leather). My only regret is that the right hon. Member for Aldershot (Mr. Lyttelton) was not present to witness this revolt.
As far as the Monopolies and Restrictive Practices (Inquiry and Control) Act is concerned, I am personally a whole-hogger. I think the Act had too many fathers—that there were too many people in two different parts of the House who were anxious during its passage, and who have been anxious since, to give it their blessing and to claim credit for it, so that like almost anyone born in such peculiar circumstances, the Act bears very heavily the marks of its parentage, which have come out more and more clearly with the passing of the years. I may claim exemption from this criticism because I was not in the House at the time. Perhaps, therefore, I may be permitted to make the criticisms of it that I should have liked to have made then, though I know that I have the advantage of being wise after the event.
It seems to me that the Act is weak both in its provisions and in its terminology. It provides for investigations into and reports on matters referred to the Commission on behalf of the Board of Trade. The Commission is given the task not only of investigation and report, but, further, of considering what remedies are necessary if the activities of monopolies operate against—to use the words of Section 14—"the public interest." If the Commission discovers that the monopoly's activities have operated against the public interest, then the appropriate Minister—one of eight Ministers dealing with financial affairs—is empowered to make an order prohibiting acts which are regarded as contrary to the public interest. That order requires the approval of both Houses of Parliament.
Yet this Act, though it gives to the Commission quite extraordinary powers, contains no definition of what constitutes the public interest. The hon. and learned Member for Chertsey (Mr. Heald) said that that was a good thing. If it were the task of the Commission only to inquire into abuses, to make an investigation and then to report, then I would agree that there is no need more closely to define what should be regarded as the public interest; but surely it is a bad thing to give to a Commission legal powers not only to make investigations 2735 but to consider remedies, and then to leave the Commission without any kind of guidance, without any terms of reference, about what the public interest is, in favour of which it is to propose remedies against abuses.
Moreover, the Act, though it does not lay this down, has generally been interpreted as providing for piecemeal investigation of isolated cases, so that, not wrong practices, but particular industries have been so far the exclusive concern of the Commission. It would seem to me that these two facts—that there is no definition of what constitutes the public interest and that the procedure is by piecemeal investigation—are mutually destructive.
§ Mr. Niall Macpherson (Dumfries)
Does the hon. Gentleman not accept Section 14 as giving some definition of the public interest?
§ Mr. Williams
Yes, it is true that in Section 14 there is a generalisation—a generalised direction; but it would seem to me that if an Act gives powers to a Commission not only to enquire into—and Section 14 is adequate for that—but also to propose remedies which, after the making of an order, are to have the force of law, but contains no more definition than that, it is inadequate. I will explain why I think so—because without help from the Government, without specific help, without legal terminology, the Commission has been given by the Government a task which they themselves have failed to achieve—to report upon conditions operating against the public interest and to propose remedies.
The defectiveness of this procedure can be seen now in both the slowness of the procedure—the slowness with which any achievements have been recorded to the credit of the Commission—and also in the fact that there has been, as my hon. Friend the Member for Hammersmith, North (Mr. Tomney) pointed out, so much evasion in the evidence given and of the conclusions reached upon that evidence. It seems to me that the piecemeal approach is seriously defective if it is intended to assess general abuses against which the Government would take effective action, because to assess a single industry it is surely necessary to see it in the context of the whole economic set-up. The Government, in this kind of direction 2736 to the Commission, have invited slowness and ineffectiveness.
I suggest that the Government and Parliament must define much more clearly than they have done hitherto their attitude to these industrial monopolies. So far too little attempt has been made to discover what forms of monopoly action are most harmful to the national interest. We have in this House, and on the same side of the House, hon. Members who—and I am sure that the hon. Member for Somerset, North will forgive my drawing attention to this—are able to represent great monopoly interests on the one hand, and, on the other hand, to make violent attacks upon them.
The United States have been clearer about this. They have made monopoly activities criminal offences, and their dealing with the matter has been on terms of criminal proceedings. They have made a much more effective attack upon monopolies because they have been able to gather into the inquiry machinery all the forces and resources of the criminal investigation departments.
The President of the Board of Trade, when interrupted by my hon. Friend the Member for Hammersmith, North, made quite clear how powerless, practically, the Monopolies Commission is in its inquiries. He said, in effect: "It is possible for us to summon witnesses, but it is certainly not possible for us to get the truth out of those witnesses when they appear." My hon. Friend gave illustrations of evasion in giving evidence before the Commission. It therefore seems foolish and mistaken, if not wrong, for this House to be satisfied with a nebulous, ill-defined attack upon something which all those who have spoken today insist is a bad and pernicious practice, which has serious consequences for the well-being of the nation.
If the Commission is to make any serious contribution to an attack upon monopoly practices—upon which we are agreed today, although 12 months ago it was rather different—if it is to have administrative force to prevent the abuses that we recognise in a monopoly, it needs more effective, deliberate and specific support from Parliament than it has hitherto had.
§ Mr. Macpherson
I apologise for interrupting again, but is the hon. Member suggesting that in the respect that the 2737 Monopolies Commission can summon witnesses but cannot necessarily extract the truth from them the Commission is in any different position from any other court or tribunal?
§ Mr. Williams
Yes, in this sense, that the Monopolies Commission, if I understand it rightly, has no sanction, if the evidence that is given is wrong or is deliberately misleading, to ensure that people speak the truth. The other courts in the land have such sanctions against deliberate misrepresentation, but the Monopolies Commission has no such sanction.
It seems to me that there are glaring evidences of failure on the part of the Government to deal with manifest abuses. The Government have done almost nothing, in spite of the great pretentiousness of this Act, to deal with restricted entry into industry. They have done virtually nothing to prevent the collective boycott of firms that refuse to enter into trade associations. I feel very strongly about the vague and generalised comments of the Government so far against what seems to me to be one of the really vicious things about monopoly practices in this country—namely, the practice of resale price maintenance.
The hon. Member for Somerset, North, said he did not believe that the effect of an attack upon monopolies would be greatly to reduce the cost of living. That may be true. But it is certainly true that, marginally speaking, it is possible to reduce the prices of certain commodities in the shops to a considerable extent. Let me quote a simple illustration which could be multiplied a thousand times, because one-third of the retail products on sale in this country are under collective resale price maintenance agreements.
§ Mr. Watkinson (Woking)
I think the hon. Gentleman was not in the Chamber at the time his right hon. and learned Friend made a certain statement last week. He is now contradicting what his right hon. and learned Friend said last week—which has been quoted by my hon. and learned Friend the Member for Chertsey (Mr. Heald), which the right hon. and learned Gentleman did not deny—that it is impossible to make any substantial reduction in the cost of living by enacting against or doing away with monopolies.
§ Mr. Williams
I merely say that it is possible to reduce the price of those things that are controlled by these resale price maintenance agreements, which constitute about one-third of the total retail products of the country. I thought I had tried to make that clear.
Let me give one illustration. It is said that there is on sale in this country a metal cleaning commodity, the charge for which is 1s. 3½d. a tin. The contents of that cleaner are raw petrol and sand, and the total cost of production and resale is, it is estimated, 3½d. I am not saying that by reducing the price of one commodity of that kind we would do very much about the over-all cost of living, but at a time when we are faced with the continued threat of an increasing cost of living the Government ought not to neglect this kind of thing.
They ought to do a good deal more than they are doing, and a good deal more than the provisions of this Act would seem to enable them to do, to ensure that, even at these marginal levels, an attack is made in the interest of our people against those who are holding the country to ransom. The final effect of these manifest abuses is that the country is being held to ransom by people who are much more concerned about profits, or perhaps with bolstering up inefficiency, than they are about the welfare of the nation as a whole, which it is the business of the Government to defend.
The hon. Member for Somerset, North, has already indicated the long-term effects of the restrictive practices of monopolies upon the standard of living of the working people generally. Arguments may be used in defence of resale price maintenance agreements and monopoly agreements on restrictive practices of all kinds in their immediate effect, but there can be no doubt about the long-term effects upon the standard of living of ordinary working people, who are prevented from having the advantages of efficient machinery and plant in our industries which, by means of the practice of monopoly organisations, have been bolstering up inefficiency.
The steel industry of this country is a good example. The steel industry now makes a great to-do about nationalisation, and claims to be the most efficient and cheapest steel-producing agency in Europe. The simple fact remains that it 2739 was not until the Government took over control of the steel industry that it was anything like efficient. The evidence of the inter-war years is that the steel industry was notoriously inefficient, and was protected by its monopoly power; it protected itself and bolstered up its inefficiency by means of restrictive practices of all kinds.
I hope that the heat with which I have spoken will not deny me the privilege of saying that I believe that, within the limits of its defined field, the Monopolies Commission has done a good job. My criticism is that from the beginning the field has been too limited. I hope that one of the consequences of this debate will be that the Government will again approach the whole problem of making an attack on monopolies with a much wider conspectus, that they may have a different emphasis in policy.
I suggest, in particular, that the Government should, as soon as possible, speed up the work of the Commission by increasing the number of permanent members, and certainly by increasing the size of its staff, who could deal with many of the things that now clutter up the work of the Commission. Much of the inquiry could be undertaken by the secretariat and need not be the concern of the Commission in session.
I certainly think that the Government ought to strengthen the Act so that the practices condemned in one industry are made illegal in all industries. New legislation ought to be introduced, and with the assurances that we have had from all parts of the House it ought not to be difficult, in spite of the Government's small majority, to get it through and to prevent the practice of collective price maintenance.
It is necessary to ensure that full publicity is given to the restrictive practices of monopolists, so that the Board of Trade may be able to ensure that all cartels entered into by monopolies should be made public. The example of Sweden stands before us. From 1950 it became essential for every monopoly cartel agreements to be published within six months, with the result that a quarter of the monopolies of Sweden folded up. The hearing of evidence by the Commission ought also to be in public, because in the case of the Dental Goods Order, the 2740 dental goods manufacturers and traders are now claiming that the action taken against them is unfair, and there is no opportunity of knowing upon what evidence the Commission reached its conclusion.
These are the suggestions that I have to make. I hope the Government will bear them in mind along with the views of other hon. Members of this House, so that the work of the Commission may be speeded up and that teeth may be put into the powers which the Commission already possess. I also hope that Parliament will declare its opposition to the iniquitous practice of monopoly restrictions, which is doing so much harm not only to our immediate problems but to the future well-being of our country.
§ 1.42 p.m.
§ Mr. Watkinson (Woking)
I am glad that I have been called at this point in the debate, because, although we have been debating for something like two and three quarter hours, I am the first speaker who is actively engaged in the manufacturing industries which are covered by the present scope of the Monopoly Commission. It is the Monopoly Commission and its work which we are primarily discussing rather than the question of price maintenance, which was mentioned at such length by the hon. Member for Hammersmith, South (Mr. W. T. Williams). As this is a non-political debate, it is time that the view of the manufacturing industries was put in order that we may have a fairly balanced picture.
I had intended to second the Amendment of my hon. and learned Friend the Member for Chertsey (Mr. Heald), but I understand that it is not going to be moved. We have, however, achieved one thing, and that is that it is quite obvious that there is complete unanimity in the House—the hon. Member for Gloucestershire, South (Mr. Crosland) put this point very well—on the issue that the Monopolies Commission must be strengthened if it is to carry out its work properly, and it must be enabled to carry it out on a wider range of operations than has been the case to date. At the moment it can only hold one inquiry at a time, but it should be able to run to two or three at once if certain steps are taken.
2741 Having said that, I want to express considerable disagreement with those Members who have urged an immediate expansion of the legislation dealing with the problem of monopolies, price maintenance and price fixing. The debate has departed very widely from the point at issue which was put by the hon. Member for Gloucestershire, South. He spent some time in saying that he was now a disciple of gradualness in this matter, and it is to that point that I should like to direct my few remarks this afternoon.
Those who advocate immediate legislation on this matter, which is a very serious one, should remember that the specific instances covered by the Commission's reports on this subject are very few and everything else is largely hearsay. As an example of the sort of difficulty which one might run into by trying to urge the Government to proceed with overall legislation at this time, which, in turn, would affect every industry in the land, I should like to quote what are represented to be the opinions of the Amalgamated Union of Foundry Workers, who gave evidence to the Commission on the subject of cast iron rainwater goods.
Here is the view of the Union as set down on page 52 of the Commission's Report, although it must be appreciated that it cannot be taken as a verbatim report of what happened, because no such reports are apparently taken:While the representatives of the Union were critical of the control of the industry by the B.I.A., they did not favour a return to price competition between manufacturers, on the ground that in the past (and so lately as 1939 when the competition came from asbestos cement goods) price competition had been associated with wage reductions. In their view 'the light castings monopoly is restrictive of economic and social advance, and the time has come when it should be nationalised in the interests of the national economy'.That has already been discounted by the remark of the hon. Member for Gloucestershire, South, who made it quite clear that the last and most powerful threat to any industry to make it come into line is the fate of nationalisation.
I do not think that the view of the union, that competition is inevitably associated with wage cutting, is correct. Competition should have the very reverse effect for, if successful, it should lead to the high wages which are associated with high and efficient output. I am only 2742 instancing that point as the sort of danger which this House will run into if it is decided to rush through overall legislation before further reports are available.
Judging from the debate and from the expressions of opinion on both sides of the House, hon. Members are trying to see whether, by abolishing or restricting monopolies, we can do something to put our country in a better competitive position and cut the fantastic rise in the cost of living, which is bearing so hardly on all of us, as well as do something to increase productivity. The hon. Member for East Ham, North (Mr. Daines) made that point when seconding the Motion, and it was the only one point in his speech with which I agreed.
Let me return to the point that I was making on the desirability of first strengthening the Monopolies Commission to enable it to take a wider view. We should not embark on any sort of general legislation until we have greater knowledge and more evidence to go on. That would be the sensible, practical way of approaching this problem, and it was from that point of view that my hon. and learned Friend put down his Amendment on the Order Paper. We particularly inserted the word "useful" in the last line but one in the hope that the Government, before going on with any overall legislation, would consider this point of whether it would not be wise to wait until there was further evidence and further practical experience gained through further reports from the Monopolies Commission.
I see that the President of the Board of Trade is now in his place. I was saying that there appeared to be general agreement that the work of the Commission should be enlarged and that the Commission itself should be strengthened, but I was expressing my acute disagreement with those hon. Members on both sides of the House who have said that we should immediately, on the basis of the present findings of the Commission, produce some over-all legislation which would then tie the whole matter up from a legal standpoint. Our Amendment was designed to show that we should like to wait until further practical evidence is available from the Commission.
I do not disagree at all with the general remarks of my hon. Friend the Member 2743 for Somerset, North (Mr. Leather). We all know his very wide experience of and sympathy with the trade union movement, and I do not disagree with the practical points which he raised, but if he and others who are urging immediate legislation had their way it would do a great dis-service to British industry which might find itself saddled with something which is the reverse of what we want. This would throw a spanner into the works.
Hon. Members have quoted American practice. I do not disagree that, in general, legislation in America has succeeded in removing large monopolies but, as I know from my own experience in my industry, it has also resulted in an enormous amount of shuffling and manoeuvring in order to get around the various requirements of the Taft-Hartley Act and other Acts which has certainly not been to the benefit of the industries concerned. I do not want that to happen here.
When monopoly legislation is introduced here, if it is introduced, I want to see it do two things. It must safeguard the consumer and the public as a whole against restrictive and monopolistic practices. It must also let the free wind of competition blow through industry for the benefit of the workers in industry and the benefit of our productive capacity as a whole. At the moment it would be very difficult to formulate over-all legislation to fulfil those requirements.
The name of my right hon. Friend the Member for Aldershot (Mr. Lyttelton) has been bandied about in the debate. It is not my purpose to defend him because he is fully capable of doing that himself, but as his name has been mentioned a good many times I feel I ought to say that his group of industries is one of the biggest props to our export trade in engineering products. I think he ought to be given some slight credit for doing as much as any other group of large industrial organisations to sustain our export drive in foreign markets.
There are always two sides to these questions, and it is time in this debate that the side of industry was put forward. I am sure that the President of the Board of Trade would agree that we must not only have account of theoretical considerations and the rights of the consuming public, which it is right should be protected, but we must ensure that in 2744 doing the things which are so necessary we do not fail to achieve the results we are seeking by making it extremely difficult for industry to continue to work on an efficient basis.
Some Members who have spoken by inference, if not in actual statement, have used some hard words about trade associations. Many trade associations have very undesirable practices, and I should like it to go on record that in my view the dental goods industry got exactly what it deserved in the findings of the Commission upon the industry. I hold no brief for the kind of restrictive practices which were written into the articles of association of that industry. The industry got exactly what it deserved, and the Commission was quite fair and frank with it. The industry had every chance to defend itself, and I do not agree in any way with the industry if it now says that it was unfairly treated. I should like to see similar treatment meted out to some other industries.
Let us now look at the other side and realise that the Ministry of Supply relies on the advice of about 200 trade associations on the difficult problems which are always arising concerning the shortage of raw materials and so on. I ought to declare an interest by reason of the fact that I am a member of a trade association and may therefore have some slight prejudice. The 200 associations are an essential link between the Ministry of Supply and industry. In the case of the Board of Trade there are about 50 essential trade associations acting as a link between that Ministry and industry. The President of the Board of Trade will not deny that these associations do a good job and try to work with the Minister concerned to get efficiency and to do what is necessary in the interests of the country.
Let us try to approach this in a thoroughly non-party political way, for it is not a party political matter. In any case, the Conservative Party have always supported the Commission since the conception of the idea. Let us bear in mind when considering what the future of the Commission shall be and what legislation, if any, shall flow from it, that we should try to design it to work efficiently and that we should not be driven on by people whose feelings about the cost of living and other things take the form, 2745 "Off with his head and be done with it," but should consider the thing broadly and take as much evidence as we can fairly and frankly as possible before we come to a decision about legislation.
§ 1.58 p.m.
§ The President of the Board of Trade (Sir Hartley Shawcross)
I am glad that we have had the opportunity of canvassing this most important matter in debate and that that opportunity now enables me to indicate the policy of His Majesty's Government on this matter and my own views. We support the general policy of the Motion, and I intend as far as I can to pursue that policy with all possible energy and enthusiasm.
While I congratulate my hon. Friend the Member for Gloucestershire, South (Mr. Crosland) on his good fortune in securing the first place in the Ballot for the all too short time which is available to Private Members and on the great advantage he has taken of it, as one would expect, by the brilliant and convincing speech he made, I must commiserate with hon. Members opposite on the most painful and embarrassing position in which the Motion unhappily places them. It is too bad.
There are times when my heart positively bleeds for right hon. Gentlemen who ought to be on the Front Bench opposite at this moment but who have wisely absented themselves. How careful they have to be to select who should represent them from the Front Bench on occasions such as this. This afternoon they have been wise in selecting the right hon. Member for Southport (Mr. R. S. Hudson), a most experienced and successful farmer, to speak upon this matter and to make sure that the right hon. Member for Aldershot (Mr. Lyttelton), a most experienced industrialist, is, as I hope, placing money on the right horse in another place. [Hon. Members: "Oh!"] I believe there is a race meeting today.
What is the position of Members opposite in regard to monopolies and restrictive practices? Do they approve of monopolies? Do they approve of restrictive practices? They do; yet they do not. There are, of course, some hon. Members who are open-minded and progressive-minded on matters of this kind, and some of them have spoken in the course of this debate. They see the evils, 2746 they appreciate the public disadvantages, of these and other practices. The hon. Member for Somerset, North (Mr. Leather), who made a most striking and devastating speech addressed in the main to his own side of the House, is certainly amongst that number. And those who take that view, who realise that these restrictive and monopolistic practices are contrary to the public interest, are at least beginning to realise that it is only the Labour Party which is likely to secure their abolition.
§ Sir H. Shawcross
When the hon. Member for Cheadle (Mr. Shepherd), and other hon. Members such as the hon. Member for Somerset, North, realise the full implications of that, we shall welcome them on this side of the House.
§ Sir H. Shawcross
In view of what the hon. Gentleman has said, I cannot give way. I do not know the views of the hon. Member for Cheadle about this matter, but we should certainly welcome on this side of the House the hon. Member for Somerset, North, who made his views very clear in a most impressive speech. And in due time we shall be pleased to welcome the hon. and learned Member for Chertsey (Mr. Heald), who was so courteous and kind in the references he was good enough to make to myself, references which I sincerely appreciate.
The existence of that element amongst hon. Members opposite, the element of hon. Members who understand these practices, who appreciate that they are operating against the public interest, makes the embarrassment of the Tory Party on this question all the greater. Some hon. Members, with perhaps more courage than discretion in the Tory Party come out quite frankly and say that they believe these practices are a benefit; although how they can benefit the consumer, I have not yet heard anybody explain satisfactorily.
Other hon. Members, like the hon. Member for Woking (Mr. Watkinson), make speeches in which they seem to admit that these practices are perhaps bad, perhaps inimical to the public interest, and that they ought to be done away with. But not just yet. 2747 Let us wait. Let us put it off a year or two. Let us have a little more inquiry. Let us have a little further evidence and then perhaps, in due time, we shall be able to consider the matter again.
§ Mr. Watkinson rose—
§ Sir H. Shawcross
And then the great majority of hon. Members opposite, having nothing which they would wish to make public on this matter, wisely advertise the fact by staying away from a debate of this kind.
Having said that about hon. Members opposite, I must at once make it clear that I am referring only to hon. Members belonging to the Tory Party. The hon. Member for Eye (Mr. Granville) made what I am sure the House will have felt was a most useful contribution to our discussion of this matter. Although we have disagreements with the Liberal Party about other matters, it is only fair to say that in this matter the Liberal Party have a consistent and progressive tradition. I pay tribute to the study they have given to this problem and the efforts they have made to promote intelligent and progressive views about it.
I have their little red book in front of me. It is the fact that in June. 1945, they reported the conclusions of a Committee, set up some time before, which went into the whole subject of monopoly and restrictive practices. It was a valuable report. It was a report which condemned these monopolistic practices root and branch. Indeed, only in March of this year they put down on the Order Paper a Motion which is still there calling for legislation to deal with these matters.
I have always been a member of the Labour Party from quite an early age but, as one who comes from a family with an old radical tradition, I rejoice to think that it falls to our lot to carry out a policy which the Liberals have long supported and on which they have helped to create an increasingly informed public opinion. If I may say so to the hon. Member for Eye, as in the past, so in the future, the Labour Party will carry into effect many of those progressive, democratic policies which members of the Liberal Party have supported but against which the Tory Party in the mass inevitably sets its face.
§ Sir H. Shawcross
Like the Liberals, in this matter we believe that, particularly in conditions of full employment—such as our policy is calculated to achieve, and we hope it will be successful in maintaining—monopoly and restrictive practices are generally inimical to our economic well-being. In the private sector of industry we think that competition is the safeguard for the public and, indeed, the very lifeblood of private enterprise in the true sense. When it disappears the public are ill served and stagnation and private unenterprise take its place.
Moreover, and this is a consideration which has to be recognised in studying this matter, there are some fields in which full employment, buoyant markets and heavy demand, tend to protect inefficient elements in industry. That makes it all the more necessary to do away with artificial impediments and restrictions against development and progress. I do not quarrel with what the hon. Member for Somerset, North said about these aspects of the matter: I emphasise to both sides of industry that in these conditions of full employment restrictive practices are less useful to the people who sponsor them and more inimical to the public interest. We have to make better progress in sweeping them away.
Let me say at once that the machinery of the Monopolies Commission set up in 1948 has proved insufficiently expeditious. That has been a matter of great disappointment. Let me at the same time say, also at once, that that involves no kind of criticism of the members of the Commission, or of the staff. On the contrary, I think it is right to say, in the course of a debate of this kind, that the staff, not large as hon. Members have pointed out, and the Commission, in the main part-time members, have done excellent work. I want to pay a tribute to what they have done. They have been actuated by a high spirit of public service, they have worked hard and they have worked well.
It was, I think, inevitable, given the machine they had to work, that the start should be slow. They had to evolve a new technique of inquiry with all reasonable safeguards for those whose interests 2749 were involved. The proper and objective examination of the facts took time and I think everyone would agree, whatever views they may have about the progress, the slowness of the progress, that the Monopolies Commission are to be congratulated on the quality of the first two reports they have issued from this general point of view.
Nor, of course, are the first two reports by any means a full measure of the work done. When we say they were appointed at the beginning of 1949 and we are now half-way through 1951 and they have only published two reports, it sounds much worse than the situation really is. Six references were made to them in March, 1949, and, although only two reports have been published so far—one about dental goods and one about rainwater goods, as they are called—work on the remaining four is well advanced and reports on them—electric lamps, cables, matches and match-making machinery—are to be expected by the end of the year.
Three other matters, insulin, certain semi-manufactures of non-ferrous metals and the machine printing of woven fabrics, have recently been referred to the Commission by the Board of Trade in addition. Our assessment of the present position and the rate of progress is that by next year, if the machinery were left as it is, and if, as it would be, it were running normally, we might expect a steady flow of these reports at the rate of three reports a year. I say at once that that is too slow, and I think much too slow. It is too slow not because the members of the Monopoly Commission are not doing their utmost to produce the reports, but because the machinery they have is not sufficiently adapted to its task in view of the number of restrictive practices which, as it turns out, they may be called upon to investigate.
Indeed, up to the end of last year serious suggestions or requests for the reference of no fewer than 55 different matters had been made to the Board of Trade and had been listed in the Board of Trade's Annual Report on the working of the Act. I do not say that all of them would have to be the subject of a full and detailed examination, but, on the other hand, there is this list of suggestions and requests from outside. In addition to that list of outside suggestions and requests, the Board of Trade can 2750 refer other matters to the Commission for investigation. Indeed, the three matters I have just mentioned, which we have recently referred for investigation by the Commission, did not appear in any list which had been previously published and, therefore, are additional to the 55 I have mentioned.
At the rate of three reports a year, we might theoretically have to wait 15 years for the answer in regard to any one practice we wanted to have investigated and, both as a matter of public relations and as a matter of economic progress, obviously that process is much too slow. Take, for instance, the question of public relations first; it is not unimportant. A builder's merchant—I am taking concrete cases that one gets—suddenly finds he is no longer granted the trade discount he previously received on some important material because the trade association has altered its approved list of merchants, perhaps, or because it has made some change in the basis of qualification for membership of the association.
Or an ex-Service man finds that he has got the money to start a newsvendors shop, but he is informed that it is not the policy of the association to make supplies of newspapers and magazines available to new shops in that area. These are not exaggerated cases. Only yesterday I received a letter from an hon. Member belonging to the party opposite and I am very much obliged to him for bringing the matter to my notice. It was a letter from a shopkeeper. I will not mention the hon. Member's name, nor the name of the shopkeeper, because, if I do, it might expose that shopkeeper to further penal consequences.
I will make this comment before I read the letter. People talk, the hon. Member for Woking, who preceded me, talked, about British justice and about nothing being done to interfere with the quasi-judicial procedure of the Monopolies Commission. People talk about "snoopers." Yesterday I gave an answer to the effect that over the whole vast field of British industry the Board of Trade employs 179 inspectors, I think about one-third of what we employed four years ago. That was published in the newspapers under the heading, "179 Snoopers."
I wonder if hon. Members have ever seen in any of the newspapers any 2751 comment, any protest, about the snoopers who go round to see whether any little shopkeeper who has not been authorised by the trade association to do so is promoting the freedom of the Press by selling newspapers? I wonder if hon. Members opposite have ever seen any vigorous protest made by the newspapers, or heard any such protest by hon. Members on their own side, about the extra-judicial and secret tribunals which, without any trial at all, and without hearing any evidence or question of mitigation, condemn small shopkeepers because they have not pursued some practice which the trade association demands. I will read the letter; "Dear Sir," this woman says,I am writing to ask your help and advice; what I want to know is, is it an offence to sell cheap? I bought some hand cream to retail at 1s. 4d. a tube. After a while the price rose to 1s. 8d. I did not raise my price. A woman bought a tube from me at 1s. 4d. She had been sent in by the P.A.T. Association who reported me for not raising the price to 1s. 8d., a man from the P.A.T.A. who told me that unless I raised my price to 1s. 8d. I would have my name placed on the P.A.T.A. stop-list and supplies would be stopped. My husband is a diabetic and unable to run my business. He is an ex-Service man, 1914–18. Our seven sons served in the last war and some were wounded.I make no comment on the following observation, except that it seems a little inconsequential.Needless to tell you that my husband, myself, and seven sons, and one daughter voted for you. We all helped Councillor"—somebody—to get the planners out. Your advice will greatly help me.I suggested to the hon. Member opposite who was kind enough to send me this letter and who has been good enough to ask me for advice about how to reply to it, that the best advice he can give that lady is to vote next time for the party which will get the monopoly restrictionists out, and will prevent the kind of injustices which they inflict on small traders in that way.
I am talking about the human relations aspect of this matter. To that kind of person this problem is an immediate problem and the hardship imposed by that kind of action is great. We cannot ask such people to wait for 15 years before we submit that kind of case to investigation by the Commission; and 2752 then, and thereafter, consider whether legislation should be brought in concerning it. She wishes to know—she starts her letter by saying so—is it an offence to sell cheap? I hope we soon shall be able to assure her that it is not going to be an offence from any point of view to sell cheap. That is the human side.
On the other hand, on the economic side, we may, indeed we often do, have people with perhaps some new invention—and that is a most important class of case—where somebody has produced an invention and secured a patent for a new process. We may have the case of a man who has some more efficient method of production, who is seeking to enter some productive industry and promote the efficiency of that industry as a whole; but who, when he attempts to enter into the industry and engage in competition with those already in it, finds that the trade association concerned has set up some effective barrier against his entry into the profession, or has some device which prevents him from using his new methods or exploiting his new patent. That is the kind of problem which is concerned on the economic side of this matter.
That being so, I intend to discuss—I would have done so before had it not been for circumstances outside my control—with the chairman and members of the Monopolies Commission ways in which the machinery should be improved. Here, I agree with what was said by the hon. and learned Member for Chertsey that it is important and useful—not merely a matter of courtesy—that the matter should be discussed with the members of the Commission before we finally decide on the action we take; because I am sure they have now accumulated a useful fund of information about these problems with which they could help us. I am sure that the members of the Commission are likely to agree with me that the machinery which they have to operate ought to be improved and speeded up.
There are various methods of improvement which we shall have to examine and discuss. One possibility, towards which, without in any way committing myself, I am at present inclined to lean, would be to increase both the whole-time and part-time membership of the Commission, so that the Commission could sit in several divisions; each one under a whole-time chairman; each one separately 2753 and simultaneously studying different matters; each division responsible for its own report, and the chairman of the Commission as a whole co-ordinating their work. That form of procedure would greatly speed up the making of particular references, and would also accelerate the process under which we should be able to utilise Section 10. I think the point was mentioned by the hon. Member for Gloucestershire, South, for the purpose of making ad hoc orders.
I do not wish to canvass that further, because I cannot make any final pronouncement on these matters until I have had an opportunity of discussing the whole matter with the members of the Commission, after which I shall come to some conclusion as to the best methods and policy to pursue. But I would agree with what was said by the hon. Member for Somerset, North, that even so, even if we do speed up the procedure of the Commission by the adoption of methods of that kind, the process of ad hoc references to particular practices in particular investigations is not enough.
In some cases, as the hon. Member for Gloucestershire, South, suggested, it might be possible to use the machinery of Section 6 (2). That is machinery which enables the Board of Trade to make what are called limited references, requiring the Commission to concentrate its investigation on some particular practice named in the reference. We will try to test out that machinery. It may very well be helpful, but I do not think it would always be possible to single out some restrictive practice in an industry from the other restrictive practices in the same industry to which it may be related. I do not think Section 6 (2) really provides a complete answer to this problem.
Then there is Section 15, which enables the Board of Trade to refer to the Monopolies Commission the effect of some particular practice, not in one industry only, but in industry generally. But under the Act as it stands that is subject to this proviso, that previous reports of the Commission on particular industries must have indicated the existence of such practices in those industries. So, before we can operate Section 15 at all, we have to wait for previous reports of the Commission. It may be when we have had another report, or 2754 possibly two other reports—I am taking this hypothetically now, without reference to what the Commission has reported or is likely to report—it may appear when we examine two or three of the reports that some practice like boycotting, exclusive dealing or restricting entry is condemned in them; and that may suggest the desirability of reference under Section 15 in order to judge whether that kind of practice should be generally condemned in industry.
I am inclined to think—and this is one of the matters I will discuss with the Commission—that the Act should be amended so as to admit of immediate and direct references of particular practices to the Commission, not in relation to single industries but in relation to industry generally, whether or not they have already been condemned in relation to a particular industry in some previous report. No doubt there may be some practices, and again I mention these without pretending I have reached any final conclusion upon them, like price rings, boycotting, exclusive dealing, restriction of entry or black listing, and so on which are so alien to our ideas of justice and democracy, and so inimical to competitive efficiency that direct legislation is called for without any reference to the Monopolies Commission at all.
I certainly do not exclude that. On the other hand in many cases the facts are complicated and obscure. There are some matters, even in regard to notorious practices like those I have mentioned, which will have to be established somehow or other, and on the whole I think they are better established by inquiry by the Monopolies Commission rather than by an administrative inquiry by a Government Department.
In that I agree with the hon. and learned Member for Chertsey, but I decline to follow the hon. Member for Woking (Mr. Watkinson), who seemed to attribute to the Amendment on the Paper in the name of the hon. and learned Member for Chertsey some sort of delaying tactics. He seemed to think that the adoption of that Amendment would result in these processes being slowed up and delayed. I do not anticipate that result at all. There is no reason why a quasi-judicial, quasi-administrative procedure such as that of the Monopolies Commission should 2755 not at the same time be an expeditious procedure. The reforms that I have in mind both as to the composition of the Commission and as to its procedure in starting would, I think, result in greater expedition.
But there is one case—and perhaps it is right that I should mention it in passing—where direct legislation is possible without any further inquiry at all. I refer to the practice, which was illustrated by the letter that I read a few minutes ago about resale price maintenance, by which traders are penalised, sometimes by harsh methods and by the procedure of some kind of private star chamber, if they sell below some price which has been fixed either by a manufacturer or by an association of distributors. It will be remembered that the Committee presided over by Mr. Justice Lloyd Jacob recommended without any qualification that the collective enforcement of the practice of resale price maintenance should be made illegal. The Government propose to give effect to that recommendation.
As to resale price maintenance operated by individual suppliers, the Lloyd Jacob Committee recommended that individual producers should retain their right to prescribe and enforce individually a fixed resale price. But the Committee went on to qualify that recommendation by mentioning various ways in which producers ought not to use that right and, in particular, they said:Public policy requires adequate distribution of goods with provision for such price reductions as are justified by low-cost distribution or by a regular policy of distributing surplus profit to the customer.The Government attach great importance to those points. If no action were taken to restrict individual resale price maintenance, the result would clearly fall short of what the Lloyd Jacob Committee intended. We consider that the only practical and proper course is to prohibit individual as well as collective resale price maintenance. I will not argue that matter any further.
We hope to publish a White Paper, I think by next Tuesday. I should have liked it to be published in time for this debate, but the mechanical processes were such that that was impossible. I very much hope that the Opposition will want 2756 to have a debate on our White Paper in order to demonstrate that there is at least one section among hon. Members opposite who give it wholehearted support. When that time comes, we shall be able to discuss the whole merits of the matter.
§ Mr. N. Macpherson
In taking this action, does the right hon. and learned Gentleman propose to do it by orders? Why does he suggest that we should necessarily discuss this matter on the White Paper? Does he not propose to introduce legislation in the near future?
§ Sir H. Shawcross
I cannot introduce legislation this Session. I hope to be in a position to introduce legislation in the near future.
§ Sir H. Shawcross
No. It would fortify my desire to introduce legislation in the near future if hon. Members opposite insisted on having the matter debated this Session, so that we can find the strength of the support that we shall obtain, as I know, from the Liberal Party, but, as I am not quite sure, from hon. Members opposite who belong to the Tory Party.
§ Sir H. Shawcross
In that order we are following the recommendations of the Monopolies Commission as far as we think possible. We propose to deal with the matter in a general way, if the House approves, by general legislation in regard to these practices. We do not think, in view of the terms of the Lloyd Jacob Report, that it would be right to go further until the House has had the opportunity of considering our proposals and of approving them, as I hope and trust it will.
Other methods of improving the procedure have been canvassed. I will not take up time in dealing with them. There was one interesting suggestion made by my hon. Friend the Member for East Ham, North (Mr. Daines) who without 2757 having any evidence of what I was going to do about this matter, hoped that I would do something. I hope I can satisfy him that, at least, we can investigate the practice followed in Sweden whereby either the rules of an association or, as I would suppose, any agreement into which an association entered which had the effect of fixing prices, had to be registered.
Indeed, that opens up the whole question of whether or not agreements fixing prices and prohibiting sales at lower prices ought to be allowed to be legal at all. These are matters to which we will certainly give consideration. The hon. Member need have no doubt that they will be considered in a careful and sympathetic way.
The hon. Member for Eye made some reference to nationalised industries. I only say that an industry owned by the public and under the general control of Parliament is, of course, totally different from one in private hands operated for private profit. I think most hon. Members would agree—and certainly the hon. Member for Eye agreed—that there are some industries where, either because of their character, their nature, the way in which they have hitherto been conducted, or because of other circumstances, are essential to the life of the community and can most efficiently be conducted as monopolies—monopolies under public control. What industries should be conducted in that way is, of course, a matter on which we do not always agree. Most people agree that coal should; some people think that steel should not—but that is a matter of degree rather than of principle.
Many people may disagree about what is the best method. Should it be a direct control by a Government Department, as in the case of the Post Office, or should it be by a public board, and so on? The question of the public accountability of the nationalised industries is one of great importance and great interest, and I think that we must always be looking for improved methods which do not discourage initiative on the part of the industries concerned. As time goes on, I hope that these industries will, as the hon. Member anticipated, gradually pass out of the field of partisan political controversy, just as the Post Office has done. Then we shall be more able to discuss objectively what are the best 2758 methods of improving efficiency and public accountability. But partisan controversy has not obscured the fact that these publicly controlled monopolies ate vastly more efficient than when they were in private hands.
In conclusion, I want to say a few words about our proposals from the point of view of British industry and British shopkeepers. I believe that the forward-looking, progressive and best elements in British industry are anxious to get rid of some of these restrictive practices. These are the elements which have contributed to the remarkable progress of our industry in recent years. In their trade associations—valuable as the work these trade associations have done and still do in other respects—these sections of industry find it difficult, because of less progressive elements, to throw off the shackles of these outmoded techniques.
I think it right that I should say that in the case of the dental goods industry one of the leading firms in it, as soon as the Monopolies Commission published its report, voluntarily abandoned certain of the practices which that report condemned. That is an example of the fact that there are some firms which would be glad to get rid of some of these practices had they outside support such as a report from the Monopolies Commission, or some other indication of that kind.
We must indeed seek to set the people in industry free and to break the chains which at present hold back the exploitation of new ideas, the development of new techniques and the general progress of industry under the spur of free competition. In America and Canada, as the hon. Member said, they have gone far further than us in anti-trust, anti-monopoly and anti-restriction legislation. British industry will greatly benefit when it is made free to throw off these brakes upon its development, and so, also, I think, will the shopkeepers. The abolition of resale price maintenance will give a fillip—in some cases a much needed fillip—to the distributive side of industry, and ought to encourage small shopkeepers to use their initiative and skill in promoting the efficiency of their businesses.
To the consumer and to the small but keen tradesman, these proposals, while they will not lead to any dramatic reduction in prices, or the kind of price war 2759 that we have recently seen in New York and which may be the result of, perhaps, over-production in relation to demand—a state of affairs which does not exist here—these proposals will provide at any rate a modest charter liberating the small shopkeeper from compliance with standards which are intended simply to protect the least efficient among their number.
Accordingly, we commend this Motion to the House as one reflecting the Government's intended policy, and as one which, if pursued, is likely to improve the general efficiency of British industry, and we commend it, at the same time, as one which will promote and protect the interests of the consumer.
§ Mr. Watkinson
I understand that while I was absent from the Chamber for a few minutes—as I said before, we must eat sometimes—the right hon. and learned Gentleman said—and if he did, he completely misrepresented me—that I had made a plea for using the Monopolies Commission as a means of legally delaying action against monopolies. I can assure the right hon. and learned Gentleman, who was present only during the latter portion of my speech, that I did not say anything of the kind. I tried, to the best of my ability, to make it quite plain that I advocated further cases being taken to the Monopolies Commission—a suggestion to which the right hon. and learned Gentleman has agreed—in order that further experience could be gained before overall legislation was introduced.
§ Sir H. Shawcross
I am much obliged to the hon. Member. If I misrepresented that part of his speech which I did not hear, I should be sorry. I am grateful for his correction. What I said about his speech in the first instance, although I later made remarks to the effect he has mentioned, was that he was one among those hon. Members who said that these things ought to be abolished, but not just yet.
§ 2.46 p.m.
§ Mr. R. S. Hudson (Southport)
I find myself in some slight difficulty. The hon. Member for Gloucestershire, South (Mr. Crosland), in what I think all sides of the House recognised as a very well presented, well argued and moderate speech, set out to talk about monopolies. From unofficial conversations, I understood that it was his desire, and the general desire 2760 of the House, that we should try, as far as we could, to concentrate this debate on monopolies. I am bound to say that he set an example by what I thought was an almost entirely non-party speech, and to the best of my knowledge that example has been followed by hon. Members on this side of the House.
Quite frankly, I had intended to make a very short contribution setting out our views concerning what the hon. Member had said. But now the President of the Board of Trade has intervened with a speech that is quite frankly a party speech and has also devoted a great deal of his time to resale price maintenance, and it has obviously placed us on this side of the House in a very difficult position, because he has had the advantage of working for some time on the drawing up of this White Paper and we have not yet had the advantage of seeing it. Therefore, quite bluntly, I feel that he has been a little less than fair to those on this side. That being so, I do not think he will be surprised if I have to spend rather longer than I originally intended on my speech and answer some of the purely party, and quite unjustified party, considerations that he put forward.
The hon. Member for Gloucestershire, South made a speech with which, as I have said, the great portion of the House were in full agreement; but we on these benches consider—and I think we have made it abundantly clear in the past that we consider—that the acid test of monopoly in each individual case is its result on the public interest, and that each monopoly should be judged by that test. A great number of the existing monopolies arose in the pre-war years when there was world-wide over-production, or under-consumption, and when practices were started with the perfectly legitimate object of trying to get some measure of stability and security both for the men employed in the particular industries and for the owners of those industries.
To that extent, I think the conditions have changed since the war, and a great number of people who would have been prepared to defend systems which originated under these earlier conditions would now submit that, as those conditions have completely changed, many of the practices invented then are not only no longer appropriate today, but are against the public interest. No party 2761 more than ourselves are prepared to admit that and to devise, and to assist in devising, methods which will effectively deal with that sort of problem.
There are monopolies, of course, whose main object is to take advantage of their monopoly position to "soak" the consumer. We on this side have always felt that such a practice ought to be dealt with. I was pleased, therefore, to hear the hon. Member for Gloucestershire, South say that the important thing was to concentrate on the practices of the monopolies. I think that if we can do that, we shall have gone a fair way towards dealing with the problem.
The right hon. and learned Gentleman the President of the Board of Trade said that he thought, and indeed so did the hon. Member for Gloucestershire, South, that the present procedure of the Monopolies Commission was unduly slow. We thoroughly agree with that, and at the same time we do not want to put the blame on the members of the Commission. We think their staff and membership needs to be drastically strengthened so that they can build up, as we think desirable, a code of practice and of case law which will indicate which particular practices are no longer desirable in present circumstances.
As far as the actual membership of the Commission is concerned, we will go further than the view which the right hon. Gentleman expressed. We would say that what applies to the Monopolies Commission applies to many of the public corporations that have been and are being set up. It is this, that if one is going to say to a man, "I am going to appoint you for five years to a particular body," he may well say, "What is going to happen at the end of the five years?" Whatever his previous experience in business, or trade unionism, five years is a very large chunk out of a man's life. He gets out of touch with his previous employment or business and very likely loses the chance of promotion which otherwise would come his way. Human nature being what it is, there must be a temptation for the best men to say, "I do not want to bury myself for five years however important the job may appear to be at the moment." And—I do not want to be offensive here—one may well have to fall back upon people who are a little less than first-class.
2762 I have here the authority of my right hon. and learned Friend the Member for West Derby (Sir D. Maxwell Fyfe), a former Attorney-General, in saying that what we suggest is that there should be a larger Monopolies Commission, if necessary split up into individual panels to deal with particular industries, and that a judge should be appointed as its president for a period of five years. It should be made perfectly clear to him that those years would count for pension and that the mere fact that he had devoted five years of his judicial time as president of the Commission would not stand in his way against promotion to higher judicial office. We think it would be necessary to add those qualifications and promises, otherwise we feel the very best men would not agree to take the position.
If we are to have a Commission like the Monopolies Commission investigating individual industries with all the possibilities that might follow any adverse reports, it is essential that not only justice should be done but that it should appear to be done. It is vital that if one is to get industry to accept readily—as I believe a large proportion of industry would accept readily in these circumstances—the imposition of a Commission like that, they must be satisfied that they would have an absolutely fair hearing and that their views would not be misrepresented either voluntarily or involuntarily. Therefore, we thoroughly approve of the idea of strengthening the Commission in order that more industries can be examined and in order that we may get on faster than we have been able to do in the first two or three years.
But having said that, it seems to me that hon. Members opposite go that far and no further. If the hon. Member for Gloucestershire, South, reads his speech tomorrow, he will see that when he was talking, as I thought quite rightly, about the main danger of monopolies he said he thought it was not a matter of excessive prices, because of Government price-fixing machinery and so forth. He said very rightly that the main danger of monopolies after the war was that they might encourage industrial inefficiency. He said that the danger was that they might stifle the free entry of new firms into an industry and he said, above all, that they contained a threat to civil liberties.
We agree. But, after all, the whole of that portion of his speech is the biggest 2763 condemnation of State monopolies, for which, presumably, he voted, that one could possibly desire. The President of the Board of Trade talked about the increased efficiency of these new State undertakings compared with the time when they were in private hands. But what about the roads and railways today? What about the freedom of entry of new individuals into road transport today?
§ Mr. Norman Smith (Nottingham, South)
Let the right hon. Member try to start a daily newspaper today.
§ Mr. Hudson
What I am saying is—and I have no doubt that we on this side of the House are to some extent guilty too—that hon. Members opposite seem to shut their eyes to the point to which their arguments lead. The same is true of the argument the President of the Board of Trade used. He seemed to think the mote was only in the eye of the private individual.
But if one is talking about civil liberties there are plenty of examples throughout industry on all sides, employers as well as men, and particularly men, of the grossest abuse of civil liberties today. If it is a good thing to establish a Monopolies Commission of this kind and to expose to public view the type of cases such as the right hon. and learned Gentleman quoted with disapproval—and the case of newspapers is the same—then he and the hon. Member for Gloucestershire, South, if they are logical, ought to go further and condemn those practices on all sides.
I am quite convinced personally that we shall not succeed in getting through the difficult times that lie ahead unless we can convince all sides of industry of the essential need to increase productivity and that they have to abandon, masters and men, every single practice that restricts that productivity. Unless we get that we shall not survive or, at all events, maintain our existing standard of living.
I hope the right hon. and learned Gentleman the President of the Board of Trade will forgive me if I feel rather heated about it, but hon. Members opposite, and we on this side of the House, must get out of the habit of thinking all the right is on one side and all the wrong on the other. We have all to see that the wrongs of the people we represent are put right. The right hon. 2764 and learned Gentleman talked about the inconsistencies between my position and the position of my right hon. Friend the Member for Aldershot (Mr. Lyttelton). That has not been exposed in this debate, whereas the difference between himself and the hon. Member for East Ham, North (Mr. Daines) has been exposed.
The President, I think quite rightly, suggested that if restrictive practices on the part of manufacturers were abolished today, it would not have a very striking effect on the cost of living. The hon. Member for East Ham, North, however, said today that the importance of dealing with these monopolies was because it would have a great effect on the cost of living. The answer, of course, is that the effect of monopolies on the cost of living today is almost negligible compared with the rise that has taken place, first, through devaluation and, secondly, through the world rise in prices of raw materials since Korea.
It is pure humbug on the part of the hon. Member for East Ham, North, to suggest, as he did, that if one took one's shopping basket out today one would see any material influence of monopolies. That is sheer and unadulterated humbug. No one knows it better than himself. I give the hon. Member for Gloucestershire, South credit for not having put forward any such case.
So far as the relationship between myself and my right hon. Friend the Member for Aldershot is concerned, we are both agreed, I having succeeded him in his job as Chairman of the Trade and Industry Committee, on our views about monopolies. I am not sure whether the same is true of the right hon. Gentleman the President of the Board of Trade and his right hon. Friend the Minister of Local Government and Planning.
I think that it is perhaps a little significant—and it has been commented upon on our side of the House—that one of the most prominent persons today on the Government Front Bench was the Minister for Local Government and Planning. We could not fail to observe with interest that apparently he was instructing his right hon. Friend the President of the Board of Trade on what answers to give to the various points that were raised in the debate. I would suggest to the right hon. and learned Gentleman who, I understand, is still a 2765 member of the Bar that it is the prerogative of members of the Bar of his eminence to be instructed by juniors and not by seniors. I think that if he would remember that we might have less bitter debates.
§ The Minister of Local Government and Planning (Mr. Dalton)
My right hon. and learned Friend and I were only exchanging comments, and sometimes amused comments, on some of the speeches in the debate, particularly from hon. Members opposite.
§ 3.3 p.m.
§ Mr. Harold Wilson (Huyton)
The speech of the right hon. Member for Southport (Mr. R. S. Hudson), although I think it set out to be constructive, has done little to gloss over the quite clear and obvious case of schizophrenia which exists in the Tory Party on the whole subject of monopolies. The President of the Board of Trade drew attention to it, and there were signs of it even when the 1948 Act was going through the House. One could always expect when the right hon. and learned Member for Liverpool, West Derby (Sir D. Maxwell Fyfe) was leading to get one attitude towards monopolies and when the right hon. Member for Aldershot (Mr. Lyttelton) was leading to get another attitude towards monopolies.
Apart from that, I think that the right hon. Gentleman produced only the hoary old argument about State monopolies and why we do not deal with them. That point was fully answered by the President of the Board of Trade today and in the debates which we had three years ago. I think that the whole House recognised then that there is all the difference in the world between monopolies which are laid down by Statute and operate under Statute, in which the consumer is given the protection that the House feels he should have, and those monopolies which exist behind closed doors. [Hon. Members: "Coal."]
We have heard on many occasions complaints and seen complaints in the Press, about the operation of particular monopolies, but never in the Press and never in this House have we had raised the case of the inspectors of the association mentioned by my right hon. and learned Friend, the Proprietory Articles Trade Association, and never have we been given any account of how this association works, and never 2766 have we had any indication given to us of how anyone can appeal against the decisions of this private monopoly.
May I make one brief reference to an incidental remark by the right hon. Member for Southport which I thought was rather typical of the Conservative attitude? When he was briefly defending the jungle of restrictionism which grew up in the 20's and 30's, he referred to it as a period of over-production instead of referring to it more accurately as a period of under-consumption.
§ Mr. Hudson
I particularly said, "over production, or under-consumption if you prefer to call it so." Those were the words I used.
§ Mr. Wilson
I think the right hon. Gentleman will agree that that was an after-thought which followed comments by one or two of my hon. Friends. [Hon. Members: "No."] I do not want to detain the House for more than a few minutes, but certain points have been raised upon which I should like to offer a brief comment. In particular, I should like to support what has been said by my right hon. and learned Friend the President of the Board of Trade.
First of all, hon. Members in all parts of the House have commented on the slowness of the machinery established under the 1948 Act. I think all of us are disappointed at the slowness of that machine but, like my hon. Friend the Member for Gloucestershire, South (Mr. Crosland), the right hon. Member for Southport and the President of the Board of Trade, I agree that the blame for that slowness must not be placed on the Commission. They have had a very difficult job to do.
The task of examining these cases has proved a great deal bigger than any of us realised when the 1948 Act was passed. There is a mass of documents and a mass of accounts, and it is right that they should be fully examined and that there should be a full and fair trial of the case before any judgment is announced. The procedure laid down in the Act of 1948 provides for severe and firm action to be taken, and it is right that there should be a full examination before that action is taken.
I was glad that my right hon. and learned Friend—and the same point was taken up by the right hon. Member for 2767 Southport—referred to the suggestion made by my hon. Friend the Member for Gloucestershire, South, about panels. I think that is the only way in which the work of this Monopolies Commission can be cleaned up. When the Bill was going through the House I indicated my doubts about whether we could do the job by a single commission, and on that occasion, basing myself on my experience at the Ministry of Works, where there were literally hundreds of trade associations and cartels in the building field alone, I said I was doubtful whether the job could be done by a single commission.
Nevertheless, we decided to have a go and see whether that system would work. It is now quite clear, I think, that hon. Members, at any rate on this side of the Committee, Members of the Liberal Party and certainly some Members of the Conservative Party, have reached the conclusion that something more drastic is required than even a speeding up of the Monopolies Commission. I fully agree with them. In fact, in the last speech which I made from the Box in April, I said:I think hon. Members in all parts of the Committee are coming to the conclusion, as I have, that the 1944 White Paper approach to the problem of monopolies and restrictive practices is not enough.I said I thought that approach should go on, and that was the view which the hon. Member for Gloucestershire, South, has taken. I continued:But if we are to tackle this problem with the urgency required, we shall need, in addition, general powers to deal with particular harmful practices, not in one firm or one trade association, but wherever they may be found in British trade or industry."—[OFFICIAL REPORT, 16th April, 1951; Vol. 486, c. 1495.]I indicated on that occasion that, as the first step in what is in effect a changed policy towards monopolies, I intended to lay a White Paper before the House—and this, of course, is the White Paper to which my right hon. and learned Friend referred, which is to be laid, I think, on Tuesday of next week. It would be wrong in any way to anticipate its contents, but I am very glad that my right hon. and learned Friend made it clear this afternoon that it will deal fully and adequately with this problem, this evil as I regard it, of resale price maintenance; and I think my hon. Friend the Member for East Ham, North (Mr. Daines), will 2768 feel, after what my right hon. and learned Friend has said, that it fully meets the point he made both about the manufacturers' right to fix prices and also about discrimination against the co-operative movement and other dividend trades.
After the problem of resale price maintenance has been dealt with I think it would be the wish of the House—at any rate, of this side of the House—that we should then proceed to deal with other pernicious practices on the basis of general legislation, particularly as, in the course of this year, we get two or three more reports from the Monopolies Commission which will provide us with factual evidence and proper assessments of the extent of these particular harmful practices in British industry. However, I think it is vital that we should have those two or three additional reports before we proceed to further general legislation beyond the legislation to deal with resale price maintenance. I think the House will agree that it is disappointing that, for reasons on which we have all agreed, we have had to wait so long for these reports which would assist our study of further legislation.
In the discussion we must have on resale price maintenance I very much hope that some one will be able to find a rather more exciting name for it, and one which is easier to be understood by the ordinary man and woman—by the consumer—whom the White Paper will be aimed to protect. We were debating resale price maintenance in this House exactly a year ago on a Motion of my hon. Friend the Member for Hammersmith, South (Mr. W. T. Williams), and I said in that debate, that I felt that the Lloyd Jacob Report's distinction between price fixing by a single manufacturer and price fixing by a ring of manufacturers was an unworkable distinction. I am glad that my right hon. and learned Friend has shown us today that he is convinced, as I was convinced, that that distinction could not be made, and that the whole system of resale price maintenance must go, root and branch.
§ Mr. J. Foster
Is the right hon. Gentleman in favour of newspapers being sold at different rates—of, for instance, selling the "Daily Herald" at 1¼d. at one place and not in another?
§ Mr. Wilson
—but in answer to the hon. and learned Gentleman I would say that I think the right of any manufacturer or supplier to keep back supplies from a particular shopkeeper or a particular retailer just because he is selling at a lower price than that which is prescribed by the manufacturer or supplier should be withdrawn and made illegal.
§ Mr. Wilson
Reference was made by my right hon. and learned Friend to the Proprietary Articles Trade Association. That, of course, is only one of a great number of trade associations of this kind which, I think it is estimated, control about a third of all goods bought by consumers in this country. When my right hon. and learned Friend read that letter—that very graphic letter—about hand-cream, and pointed out that if this unfortunate lady who wanted to sell hand-cream at a price which she considered fair—
§ Sir H. Shawcross
Would my right hon. Friend allow me to interrupt him? Before reading that letter I should have said that before I read it I did secure the permission of the hon. Member who had been good enough to send it to me.
§ Mr. John Rodgers (Sevenoaks)
Would the President also be good enough to inform the hon. Member on this side of the advice he proposes to tender?
§ Mr. Wilson
I am glad that has been made clear. It was not the point I was raising, but, no doubt, I provided the opportunity to my right hon. and learned Friend of making that point. But in this particular case the unfortunate lady was warned by this system of snoopers that if she continued to sell the handcream—or whatever it was—at that price, she would be put on the stop list. What my right hon. and learned Friend did not, I think, make clear was that she would, of course, under the rules of that Association, have been put on the stop list not merely for handcream, but for all other 2770 goods sold by members of that trade association—
§ Mr. Wilson
—and the same would have been true if the goods had been groceries or a whole range of other goods handled by members of that association, and she would have been put out of business.
§ Mr. Wilson
I hope that a sufficient number of the Tory Party will support any action the Government take to deal with this evil, as I believe it, of resale price maintenance. After all, they fought the last General Election on a policy document called "This is the Road." The right hon. Member for Woodford (Mr. Churchill), in a message to Westhoughton, was apparently referring to it only last night. One of the first things set out in that policy document was a statement that the Tory Party would preserve and extend competition in the shops and in the factories. When my right hon. and learned Friend's proposal is before the House the Tory Party will have a chance to honour that promise which they made in 1950.
The hon. Member for Monmouth (Mr. P. Thorneycroft) is always very active in speaking about state monopolies, but he has not taken quite so much interest in private monopolies. To be fair to him, he did make an attack on restrictionism in a book he wrote called "Design For Freedom," published in 1947. The hon. Member for Hertford (Mr. Walker-Smith), who I am sorry is not here, said in a book which he wrote in 1948:Where shall we find the St. George to kill the dragon of restrictive practices?It is quite clear that we shall not find him in the Conservative Party, although we may at least find the hon. Member for Somerset, North (Mr. Leather) willing to go along beside him, perhaps holding his coat.
I should like to support the proposal of my hon. Friend the Member for East Ham, North, who referred to the compulsory registration of trade associations, or agreements made by them. My right hon. and learned Friend said that he would examine this proposal sym- 2771 pathetically. I hope that he will look at it very favourably. As my hon. Friend said, it is to be found in Sweden, where publicity is very effective, where the trade journals carry all these published reports. It would also be extremely useful for all local authorities, for public purchasing agencies, and for private purchasers, to know what rings they are up against when making their purchases. Of course, there are some who object to this proposal on the ground that it would apparently mean condonation of every trade association listed under this power which was not proceeded against under the Act, or in some other way.
Personally, I think there is little or nothing in that argument. After all, in a way it is condonation of these trade associations to list them in the Board of Trade Annual Report for possible investigation by the Monopolies Commission, and then for one reason or another not to proceed against them. The mere fact that there would be some 8,000 or 10,000 trade associations in this country to register—and I do not think the figure would be very much lower—would not mean condonation. It would, on the other hand, provide very valuable evidence which may enable us to proceed more quickly in drawing up general legislation for banning harmful practices right across the board of British industry.
I doubt whether all hon. Members realise how widespread this restrictionism is. I can best illustrate it by reference to my difficulty in appointing the Monopolies Commission in 1948 and 1949. I decided that I would appoint to it a businessman. There was some suggestion made by the Opposition that we should have someone who had served in business. I decided—perhaps rather naively, as it turned out—that I would appoint a businessman who was neither a member of a trade association which had any restrictive powers nor a victim of any trade association. It took me about three months to find such a man. Although I announced some months ago that two new members were to be appointed, the second of whom was to be a businessman, it has not proved easy to find, throughout the length and breadth of British industry, an industialist of the right degree of eminence or approach who is free of trade associations, either as a member or as a victim of their practices.
2772 Contrary to what the right hon. Gentleman said, there is no division on this side of the House in our desire to proceed more rapidly in a more general way with this question of monopoly. The only difference that exists is the natural impatience of hon. Members like my hon. Friend the Member for East Ham, North, to get on with the legislation and those who favour a more moderate course. The view that I myself take, which I think is shared by the President of the Board of Trade, is that, before we proceed to general legislation, we ought to have one or two more reports from the Commission with the one exception of resale price maintenance, on which we have all the reports and all the facts we need. I hope we will proceed to legislate quickly in the interest of industry, the shopkeepers and the consumers.
§ 3.21 p.m.
§ Mr. Nigel Davies (Epping)
The President of the Board of Trade said he thought that this debate must be painful and embarrassing to hon. Members on this side of the House. Speaking personally, I do not feel either embarrassed or pained in attacking a monopoly, private or public. If the right hon. Gentleman the Member for Huyton (Mr. H. Wilson) could not find one individual St. George to slay the dragon of monopoly, I think he will find among hon. Members on this side of the House at least one knight errant ready to defend the cause of genuine competition.
What I think must have been embarrassing to the hon. Member for Gloucestershire, South (Mr. Crosland) was that, having introduced this debate in a technical and non-partisan manner, he then heard the President of the Board of Trade making some very strong and pointed party points on the matter, which were out of place and had been avoided up to that moment.
The right hon. Gentleman contended that it was hon. Members on the other side of the House who are genuinely against monopoly, whereas on this side of the House only a few individuals are enthusiastic in that cause. Hon. Members opposite have been in power for six years For five of them they had a very large majority, but their enthusiasm was far more directed towards nationalisation and 2773 the creation of monopoly than it was in dealing with it.
§ Mr. Daines
Is the hon. Member aware that when we had the debate on resale price maintenance 12 months ago every speech from his benches was in broad support of the principle of the resale price maintenance, and every criticism came from this side of the House?
§ Mr. Davies
That makes no difference to my argument, for the point I was making was that hon. Members opposite have been in power for six years and they complain, even as the hon. Member for East Ham, North (Mr. Daines) complained today, that they have not done enough. There is a further point. I do not wish to enter into a party battle, but I should like to make it clear that if it is true that the Labour Party has really been enthusiastic in this matter, it should be noted that, in my opinion, monopoly has been strengthened since the war by Government Departments, under the present Government, working hand in hand with monopolists.
I should like to give one example of that, and that deals with the importation of steel and steel wire. I happen to know something about imports from Belgium. It is now done on an open general licence, but that was not until recently. Until recently the imports were controlled by the British Iron and Steel Federation, a body which hon. Members opposite always attack because it is a monopoly, but the Minister of Supply handed over to it the control of imports, which should have competed with home production in this country, and made it a monopoly. Therefore, I claim that, apart from creating Socialist monopolies, the Government opposite have often worked with monopolists when they found it convenient to do so.
In defending trade associations, my hon. Friend the Member for Woking (Mr. Watkinson) went further in that respect than I have done and pointed out how valuable they had been to Government Departments. I think the President of the Board of Trade agrees with that. There are many cases where monopolistic interests and Government Departments find that they can do a very nice job by working together, particularly on the question of imports and 2774 also in regard to fixing maximum prices in certain cases.
§ Mr. H. Wilson
Surely the hon. Member would agree that there is all the difference in the world between, on the one hand, consultation with a trade association and working through a trade association on the part of a Government Department and, on the other hand, condoning the action of that association in restricting entry, promoting exclusive dealings, boycotts and so on? I think that he will agree that over the last three or four years there have been many cases where the Board of Trade and other Government Departments have worked quite happily with trade associations but that there have been cases where the Board of Trade has had to fight trade associations, for instance, in regard to de-control, when the associations intended to set up monopolistic practices.
§ Mr. Davies
I agree, but there have been other cases. I cited the case of steel and wire imports from Belgium where the two sides worked hand in hand on the question of fixing maximum prices in theory, if not in practice. At present the Board of Trade and the Ministry of Supply take the advice of the trade associations about price fixing and very often fix the price which the trade association suggests.
§ Sir H. Shawcross
I must correct the hon. Member on that. I thought there was a great deal in what he was saying in regard to the general merit of the licensing system and I am looking at it from the point of view which he has in mind, but so far as price fixing is concerned we certainly do not accept the figures put forward by the trade associations unless by our own careful examination of the actual costings we are satisfied that the figures are fully justified by the facts. We are very careful about that. When we fix a price, it is, of course, a maximum price.
§ Mr. Davies
I appreciate that, but I should like privately to give the right hon. and learned Gentleman cases relating to the Ministry of Supply in which prices were nearly doubled at the instance of a trade association when there was no question of the raw material doubling in price. There are instances of that sort of thing.
2775 The main question is that of importing. I still think that the point holds good that there are cases of both sides working together and that the prices tend to be minimum as well as maximum prices. The opinion is held, perhaps by the right hon. and learned Gentleman, and particularly by civil servants, that when an industry is made a monopoly one is enabled easily to determine a fair price and that a trade association and a Government Department can then easily get together to work out the price by finding out the price of the material, the cost of machinery and labour and the overheads, so that by means of a simple mathematical calculation a fair basis can be reached. That is the basis of the work of the trade associations; it is a matter not of making high profit but often of low efficiency.
The basis of the whole case against monopolies is that there is no such thing as a fair price but that the price should be determined by competition between firms, cutting down the cost of machinery and finding more efficient machinery, and saving on overheads and the labour force, which does not happen as soon as the general idea gets about that a fair price can be fixed, reached or verified by a Government Department.
The President of the Board of Trade gave some encouraging indications of the speeding up of the work of the Monopolies Commission. I should have liked to have heard of a time limit being put on the preliminary reports so that it might have been said that perhaps a dozen reports would be enough to give a guide for general legislation, although perhaps the fact that the President of the Board of Trade will ask the Commission to refer to general practices instead of single industries will furnish the guide. I hope that can be done within a reasonable time. I appreciate that it is much better that the advice and services of the Monopolies Commission should be used before general legislation is introduced, provided that the time element is not too long.
Leaving aside the question of private and public monopoly, I want to make a point in a non-partisan way. The whole object of defeating monopoly is to increase competition and efficiency. It will be difficult in any case, but the main purpose will be frustrated if the labour situation is too non-competitive and if 2776 the dearth of labour is too great. I do not mean that there should be 10 per cent. or even 5 per cent. unemployment, any more than that there should be 5 per cent. of our industrial resources unemployed. I mean a situation where a man can arrange to turn up for work on Monday and then, without even telling the employer, go and get another job. In such a situation not only is the efficient worker encouraged, but the inefficient has to be appeased because he cannot be replaced. Such over-full employment would vitiate any good effects of trying to stimulate competition and, thereby, efficiency.
§ Mr. Norman Smith (Nottingham, South) rose—
§ Mr. Davies
I hope that hon. Members opposite will think that is a constructive suggestion. I shall be glad to talk to the hon. Member who has just risen and give him the exact details, when I am sure he will see my point. It is surprising that so little is known publicly of the bad effects of monopoly, but many industrialists are not very vocal and others who are disgusted with the whole process do not speak. As long as the inefficient are protected, we shall not get real competition or efficiency with which to compete with the United States.
I have dealt already with the question of fair price, and the main line which hon. Members opposite take when speaking of monopoly that a Government Department can reach a right price even if an individual manufacturer cannot. As to resale price maintenance, if it is a choice of having a collective boycott or all resale price maintenance forbidden, I choose the latter. I think that a collective boycott is a thoroughgoing evil, but I question what was said by the right hon. Member for Huyton, that the half-way house—individual resale price maintenance—is not practical. After all, it worked perfectly well until recently in the United States of America under the Miller Tidings amendment to the Sherman Act. It only broke down on a point of inter-State procedure. That is the only reason why it was declared illegal by the Supreme Court.
It would be perfectly practicable, if it were so desired, that individual resale price maintenance should be made legal and enforceable in this country. Indeed, I question whether it is not the right 2777 answer. There are many cases of abolishing resale price maintenance which need to be looked into carefully, to witness, the price war in New York—although conditions here are not similar.
§ Mr. Crosland
The hon. Gentleman has mentioned the experience of the United States. It is quite true that to some extent individual price maintenance operates there, but the one exception where individual price maintenance, although legal, does not operate—that is, in grocery—is where the biggest advance in self-service shops has occurred.
§ Mr. Davies
That is because it applies particularly well to food. I accept that any individual resale price maintenance should make provision for such things as self-service stores. The main thing is to get away from collective boycott and any boycott that prevents goods from being cheaper.
Examples have been given of the harmful effects of monopoly, and I want to give one to illustrate the urgency of this matter. The difficulty of giving examples is that they are very invidious and one involves other people in awkward circumstances, so I will not give names. In the business with which I am intimately concerned, I have come across a considerable piece of machinery which we needed, the cost of which ran into four figures. There is a tight ring in the supply of that particular type of machinery but, purely fortuitously, we happened to get the name of a sub-contractor who produced the machinery for one firm in the ring. We wrote to the sub-contractor and got an identical and admirable piece of equipment for about 65 per cent. of the ring price.
I should be prepared privately and confidentially to give particulars of the case to the President of the Board of Trade. It is something which is used to make goods for export. This takes place in the rather non-competitive conditions of today and ought to be dealt with. There are some price rings which operate in such a way that if an employee leaves one firm he is boycotted from getting a job with others in the ring, and that needs fairly quick legislation.
I understand that the work of the Commission will be speeded and perhaps it is right to wait to see what happens. But unless the conclusions to which it 2778 comes, either in further individual reports or in comments and reports on general practices, are very different from what I suspect they will be, I believe they will justify legislation to prohibit all price-fixing agreements between trade associations. I would not mind any Clause which allowed certain specific cases where the Board of Trade said that it was admissible that prices should be fixed but in general that should be banned.
I think, also, that unless their conclusions are quite unexpectedly different from what I believe they will be, all restriction on entry into any industry should be banned. I believe there is no justification for that restriction. I think there should be a half-way house in resale price maintenance. I believe that every appeal made for speed in this matter is most justified and right. Even if industry cannot be altogether competitive in the sellers' market and under the conditions of today—a semi-wartime economy—if producers know that conditions are going to be hotly competitive in the future, it will force them to make plans now to meet that competition and give our industry that efficiency without which we cannot survive.
§ 3.39 p.m.
§ Mr. Malcolm MacPherson (Stirling and Falkirk Burghs)
I am sorry that the clan should be divided between itself at the moment, especially as we have only a few minutes left in this debate. I will confine myself to one point. The hon. Member for Epping (Mr. Nigel Davies), in common with a number of other hon. Members, gave us an illustration today that if all hon. Members opposite are not Saint Georges or even knights errant, at least they have a great deal in common with us in their approach to some of the questions concerned with monopolies.
I turn to a particular aspect of the subject which a number of hon. Members have touched on but not developed very fully. Very naturally, they have tended to concentrate more on the economic side of the matter, business efficiency, productive efficiency, than they have on the civil rights or ordinary human rights—if one can use such a phrase which always involves other questions.
In connection with the second report of the Commission, which interests me very stronly, because my constituency contains probably the biggest centre in 2779 the Kingdom of the products concerned, I was very interested in one thing. I suppose I might quite normally have expected to find it, but when I did find it I was rather shocked into seeing things in a new light. It was that, in spite of the fact that the foundry workers are fully organised in a strong and effective union, they found that some of the practices of very long standing which the report described were completely unknown to them. For example, the employment by the ring, as a matter of deliberate policy, of the competitive firm—the stooge firm at one might call it—Housing Castings, Limited, came as a complete relevation to the men actually employed in the industry. That competitive firm was established a year or two before the war and lasted right up to 1949.
The point I wish to make is that there is a very important question of principle involved in the relations between employers and employees when practices of this sort are indulged in. We on this side of the House are sometimes accused of directing our criticisms only against the employers in matters of this sort. We are told that restrictive practices exist on the other side and there is a certain amount of substance in that, although I think the amount and seriousness of these restrictive practices is comparatively small. What is not always emphasised is that when the employing side decides to use monopoly restrictive practices they bind the workers as partners in these practices without giving the workers the elementary justice of knowing in what way they are being used.
While it is sometimes emphasised that monopolies protect to a certain extent the common interests of workers and employers in an industry, that can only be true, where it is true, on the economic side. It certainly is not, in general, true on the side which I am trying to stress now, the side of ordinary human rights. I believe that if the practices of general consultation in industry and general sharing of responsibility for policies were followed a good deal more fully than they are, many of these secret agreements against the public interest would simply not be made.
I believe that the publication of the reports of the Commission has had a good deal of effect in pointing out some of the ways in which such joint consulta- 2780 tion can further be developed. I must not go any further, because I do not wish to encroach on the time of my hon. Friend who is to reply.
I suggest that the statements made by the President of the Board of Trade this afternoon must have heartened everyone on this side of the House. He has given a forthright and specific statement of the intentions of the Government, which coincides very closely with the arguments put forward by my hon. Friend the Member for Gloucestershire, South; and which I think, when they are carried out, will have a considerable effect in removing the number of black spots from British industry.
§ 3.45 p.m.
§ Mr. Douglas Houghton (Sowerby)
Having caught your eye at this hour, Mr. Speaker, it falls to me to make the concluding remarks in commending to the House this Motion so ably moved by my hon. Friend the Member for Gloucestershire, South (Mr. Crosland) and seconded by my hon. Friend the Member for East Ham, North (Mr. Daines).
I am sure that we all agree that the two most interesting speeches that we have heard from the opposite benches have come from the hon. Member for Somerset, North (Mr. Leather) and the hon. Member for Epping (Mr. Nigel Davies), who appear to be free-enterprising Davids engaged in mortal combat with monopolistic giants. Each has given from his own practical experience some examples of the kind of difficulty which new enterprises have in forcing their way into industry, which is already surrounded by rings and doubly fortified defences.
Every time we have a debate in this House on monopolistic practices and resale price maintenance, we get fresh eye-openers as to what is really going on. We must be impressed by the statement made by my right hon. Friend the Member for Huyton (Mr. H. Wilson), who said that the public do not realise how widespread these practices are. I think that the more frequently we can have debates of this kind which will bring the facts to light, the better the public will understand how their cost of living is affected by these restrictive practices and minimum sales price arrangements.
2781 The right hon. Member for Southport (Mr. R. S. Hudson), in what seemed to me to be rather an arid speech, said that my hon. Friend the Member for East Ham, North was talking unadulterated humbug when he referred to the bearing of monopolistic practices and resale price maintenance upon the cost of living. When the cost of living is rising, every penny counts. Every tin of household cleaning polish, every piece of household goods, anything that is required in the home or for personal use, affects the cost of living. But even if hon. Gentlemen opposite are either not concerned with the cost of living or are sceptical of the bearing of the matter we are discussing upon the cost of living, they will surely be interested in its effect on exports and on industrial prosperity.
I had a case in my own constituency recently of a small firm which was manufacturing pencil sharpeners for export and trying to compete with a revived German industry which also was making pencil sharpeners. This firm wanted to get a certain type of screw. I understand that the manufacture of screws in this country is virtually in the hands of a monopoly concern. I am reliably informed that Guest Keen & Nettlefold are a virtual monopoly in the production of screws. This constituent firm of mine asked my assistance in getting an import licence to bring screws from Italy so that it could make pencil sharpeners for export in competition with German manufacturers. I was told that there was no other source in this country to which it could go to get the screws it required except concerns which were part of the monopoly ring of screw production.
This is a further instance of what has been said in the debate today, and there is no doubt of the important bearing of monopoly practices and resale price maintenance, not only on the cost of living, but also on export prices and dollar earnings.
I was surprised that the right hon. Member for Southport expressed a sense of grievance at the statement made by my right hon. and learned Friend the President of the Board of Trade. He said that he was in a difficulty, but I really do not see that he can criticise my right hon. and learned Friend for, to use his words, being less than fair by 2782 making the announcement he did. All that my right hon. and learned Friend did was to announce further Government measures to carry out the will of the House expressed in the Act of 1948.
§ Mr. R. S. Hudson
We know that the Government are going to publish a White Paper next week, and there would have been great advantages had it been possible to have had it before this debate, because we could have used this debate to discuss it. In the light of the fact that the Government are going to publish it next week, it is clear that we on this side of the House had no opportunity of preparing our views about it, and it was therefore suggested, I think unofficially on both sides—our views on monopolies are well known—that the debate should be limited to monopolies.
§ Sir H. Shawcross
I am sorry the right hon. Gentleman thinks I was unfair. I was careful not to argue the merits of that matter, but I would have been less than frank with the House had I not made it perfectly plain on monopolistic practices that we were about to publish this document. We hoped to do so today, but will do so on Tuesday.
§ Mr. Hudson
The fact that I did not know what was in the White Paper made it very difficult for me to make my speech following that of the right hon. and learned Gentleman.
§ Mr. Houghton
I think the complaint of the right hon. Gentleman is that the Government have announced two or three days in advance of the publication of the White Paper an outline of what they have in mind to do.
§ Mr. Houghton
Since I had offered some comment on what the right hon. Gentleman said, I thought I must give way to him. I think we have now cleared up that point, and that the whole House will agree that had my right hon. and learned Friend not made the announcement he did during the course of today's debate, much of its value would have been lost. The debate would have been of much less value than it has actually been.
§ Mr. Houghton
I am not concerned with whether the right hon. Gentleman calls it a debate or not, but in Parliamentary terms it has been a debate and a most careful discussion on the matter. It is true to say that there has been no dispute between the two sides of the House on this matter, except that the hon. and learned Member for Chertsey (Mr. Heald) and the right hon. Member for Southport both seemed to draw a distinction between the aims of the mover and seconder of the Motion, which was not in fact there. The only difference between the views of my hon. Friend the Member for Gloucestershire, South and my hon. Friend the Member for East Ham. North was in the speed and mode of carrying out the intentions of the House as expressed in the 1948 Act.
The matter we have before us really boils down to whether the work of the Monopolies Commission can be fully achieved by following the present method of piecemeal investigation into particular industries on reference made to them by the Board of Trade, or whether alongside particular investigation, or supplementary to it, there may be legislation on general lines.
I am sure that hon. and right hon. Members opposite are fully in sympathy with the present method of the Monopolies Commission of particular investigation; but when it comes to drawing general conclusions from particular cases and trying to legislate on general lines against general malpractices, I am not so sure we shall have the support of hon. and right hon. Members opposite. Certainly in the field of tax evasion what we have listened to in the course of the debates on the Finance Bill offers no encouragement that Members of the party opposite will join with us in general legislation against malpractices discovered to be prevalent by investigation into individual cases.
I think that is where the real clash may come between hon. Members opposite and those of us on these benches—on the way we are to develop further the method of dealing with this problem. Reference has been made to the fact that restrictive practices are not confined to one side of industry. That is true, and if any hon. Member at any time 2784 agrees to put down a Motion on restrictive practices on the trade union side of industry, we should be fully prepared to debate it. I belong to a trade union movement, though happily not to an organisation which has any restrictive practices at all. Hon. Members opposite require no assurance from me that there are no restrictive practices whatever among Inland Revenue officials, so I can disclaim any responsibility for or any connection with restrictive practices on the trade union side.
Whether they exist and to what extent I should not presume to say, but certainly if there is anything holding back production in any shape or form it should be thoroughly examined and discarded, wherever possible; otherwise, I agree with hon. Members opposite that we shall not have the full effort needed in present conditions to meet all the burdens and difficulties which are placed upon us. On this side of the House the announcement made by my right hon. and learned Friend the President of the Board of Trade is warmly welcomed and he can rely on our Wholehearted support for further measures.
§ 3.58 p.m.
§ Mr. Heald
I beg to move, in line 4, after "Commission," to insert:without detriment to the right of persons interested to a fair and adequate hearing.In view of the undertaking given by the hon. Member for Gloucestershire, South (Mr. Crosland), I am formally moving this Amendment. Afterwards I shall also formally move the further Amendment standing in my name and that of my hon. Friends.
§ Amendment agreed to.
§ Further Amendment made: In line 4, after "can," insert "usefully."—[Mr. Heald.]
§ Question, as amended, put, and agreed to.
That this House welcomes the fact that the Monopolies Commission has now published its first two reports; but urges His Majesty's Government to consider whether ways and means can be found to speed up the work of the Commission without detriment to the right of persons interested to a fair and adequate hearing and whether general legislation against monopoly practices can usefully he introduced at an early date.