§ 51. Mrs. Castle
asked the Prime Minister whether he will make a further statement on the finances of Festival Gardens, Ltd.
§ Mr. H. Morrison
I have been asked to reply. Following my previous written answer to the hon. Member for Abingdon (Sir R. Glyn) on Tuesday, 6th March, the Finance Committee of the Board of Festival Gardens have carried out a further review of their rate of expenditure which, as I informed the House, was proving to be in excess of earlier estimates. This excess expenditure has now reached a more serious scale than the information supplied to me by the company when I gave the previous reply indicated. The company accordingly finds itself in a difficult financial situation, and it is only too clear that its task cannot be completed without further provision of development capital.
The company, after consultation with me, are taking certain steps to strengthen their executive arrangements, and the Government propose also to institute a thorough inquiry into the reasons for this excess expenditure. At this stage it appears that the main factors concerned have been the extraordinary loss of working time from incessant and continuing bad weather which keeps the site in an extremely muddy state; further loss of time from labour troubles; the heavy cost of special measures for overcoming these delays; the strain placed on the management in coping with these and other problems against a very tight time-table, and also the heavy increase which arises from the world-wide forcing up of prices of commodities and from increases in costs generally.
2098 The Government therefore proposes to introduce legislation at the earliest possible date to amend the Festival of Britain (Supplementary Provisions) Act, 1949, in order to provide legislative authority for a further loan of £1 million to the company. As legislation cannot be introduced in time to give statutory authority for the immediate advance which is necessary to enable the opening to take place on 3rd May, my right hon. Friend the Chancellor of the Exchequer will, in the meantime, make additional sums available from the Treasury within this limit.
I am particularly sorry that in my reply of 6th March I should unwittingly have given the House what now proves to have been an incorrect view of the prospects of total expenditure which, on the revised figures now available, will be approximately £2½ million. On these figures the loss on operation for six months only may amount to as much as £1½ million, and this greatly adds to the financial argument in favour of continuing to operate the Gardens for a further period, during which more revenue could be put against the initial cost of development.
§ Mrs. Castle
Can my right hon. Friend tell us whether the Corporation have been able to estimate the effect on their finances of the decision not to open certain parts of the Festival on Sundays?
§ Mr. Morrison
I am not quarrelling with the decision of the House, which it freely reached, but inevitably the decision of the House not to open on Sundays did make a material difference to the possible revenues. I am speaking from memory, but I think the difference is about £200,000?
§ Mr. Eden
We are all agreed about the change made by the decision of the House, but is the right hon. Gentleman aware that that decision was commented on by him on 6th March, when he gave us an overall estimate? He said that all this had already been allowed for. The right hon. Gentleman told us, less than a fortnight ago, that the loss would be £1,600,000. Are we to understand that the figure is now to be a whole million more?
§ Mr. Morrison
It is not as bad as that. It is the case that the figure is different. [Laughter.] The right hon. Gentleman 2099 has been perfectly courteous. I think his hon. Friends behind him might be courteous, too. It is perfectly true that the figure is materially different now from the figure that I gave to the House. I gave the House the figure in all good faith, on information supplied by the company, and I am as disappointed and as irritated as the House is about this change. That is a matter which I am taking into serious account.
§ Mr. Eden
I should like to try to get at the comparable figure, because it is important. I think that the figure which the right hon. Gentleman gave us on 6th March was a total loss of about £1,625,000. I think he has told us today, unless I misheard, that it will now be £2,500,000. That is a difference of almost a million pounds.
§ Mr. Eden
I have just one more question. It is about procedure. The right hon. Gentleman no doubt realises that it is very desirable in a case of this kind that Parliament should approve this money before anything is spent, and I was very disturbed to hear the right hon. Gentleman say that it could not be done. What are his views about asking for Parliamentary approval in a case of this kind, in view of the circumstances?
§ Mr. Morrison
Parliamentary approval will be required, and we shall bring in a Bill at the earliest possible moment. The Treasury have powers to make advances out of the Civil Contingencies Fund, and that is proposed to be done, because the alternative would be to bring this part of the whole affair to an end. I think the House generally agrees that that would be a great pity. Let the right hon. Gentleman be under no fearsome apprehension on the point. Parliamentary approval will be obtained and we will bring in a Bill at the earliest moment.