HC Deb 30 May 1952 vol 501 cc1787-98

11.46 a.m.

Mr. C. J. M. Alport (Colchester)

The subject which I am grateful for the opportunity of raising follows very logically the one raised by my hon. Friend the Member for Bath (Mr. Pitman). I raise it because it is very difficult to discover any other way of putting forward a difficulty at present facing many of my constituents and constituents in other rural areas.

It is clear that the difficulties of providing an electricity supply for rural areas are greater than those for industrial and urban areas, but the House will agree that the need of the agricultural industry, in particular, for up-to-date methods of production and for electricity and all that it means in convenience for domestic and industrial use is as great as that in towns and urban districts.

My hon. Friends and I fully recognise the importance of the decision made by Her Majesty's Government to allocate an extra £1 million for rural electricity, and many of us placed great hopes in that additional assistance, but what concerns me at the moment is that I see no signs that, even with that additional sum, agriculture's problem will be met.

I have had from the Eastern Electricity Board, the board with which my constituency is mainly concerned, a statement of the works to be undertaken in the area during the next six months or so. I note that of the 34 works mentioned very few, if any, are concerned with improving supplies directly to farmers. Supplies will be improved to housing estates in parishes and to various installations situated in country areas, but the prospects of the farmers in my constituency of receiving the electricity supplies which they so much need appear to be scarcely greater than they were before the £1 million was allocated for rural electricity supplies.

In the past it was the policy of the Eastern Electricity Board to give priority to urban industry and housing estates in any work undertaken. I recognise the importance of making supplies of electricity available to those two categories, but I want to ask my hon. Friend where the power of decision rests in regard to priorities in the extension of electricity supplies. Is it in the Ministry, or is it in some body which is representative of industry and agriculture, or is the power vested solely in the hands of the various electricity boards themselves?

It seems to me to be wrong, even though capital investment is limited, that an electricity board should be able to say "We will make an amount of money available to one type of potential consumer, and nothing to another," if, as I believe is the case, it is very much in the national interest that the development of electricity supplies, in order to assist increased agricultural production, should take place.

I should like to go further and illustrate my argument. It is said that one of the reasons why it is impossible to increase and extend further electricity supplies and new installations in rural areas is the shortage of the requisite materials. Cables, for instance, I have always been told, are in very limited supply.

Not long ago, I received from the Colchester Council a letter complaining of a decision made by the electricity board to the effect that, in order to obtain the installation of electricity supplies to a new housing estate in the town, the electricity board had insisted that two additional power points should be included in each house. As far as I can make out, the object, from the point of view of the electricity board, was to ensure the increased consumption by the tenants of these houses of electricity for domestic purposes, and to ensure a greater turnover for the board in order to maintain a reasonable amount of profit on the supplies which the board make available.

To do this, the electricity board insisted that the additional cable and wiring which would be necessary should be introduced into the houses against the wishes of the local council, and I think also against the wishes of those tenants who were to occupy the houses. The decision by an electricity board to allocate raw materials to something which neither the tenant nor the owner wishes, rather than to allocate those materials to something which I consider is of much greater importance—that is, the provision of additional supplies to farming areas—is mistaken.

If I may quote the Colchester Council on this issue, it seems to me that they put the point very clearly: The departure on the part of the board from previous practice raises a question of national policy…it would not be proper for the council to add to the cost of housing with the primary object of encouraging the use of electricity of which the peak demand exceeds the supply, and is likely to do so for very many years. In that particular point, the council fully represented the national interest, as I understand it. We do not wish this high-powered sales pressure, so to speak, from the electricity board to encourage the excessive use of electricity or the excessive use of materials in supplying apparatus for excessive domestic use at the present time. We want to ensure that our electricity resources, limited as they are, are used in the best interests of the community as a whole.

My second question is this. Who decides whether it should be the policy of the electricity board to press upon the public the increased use of electricity for domestic purposes as against the more desirable object of increasing the use of electricity for agricultural and industrial purposes? Surely, to go from the particular to the general, the point is this. The need, as I believe it, is for a national fuel policy, something which will decide how our fuel resources can best be used in the interests of the nation as a whole, and I cannot believe that the responsibility for initiating that policy can rest with anybody except the Government and the Ministry of Fuel and Power.

It seems to me that one step towards the evolution of a national fuel policy would be to inquire into the policies and practices of the electricity boards, the gas councils, and, indeed, of the whole field of fuel production and consumption. I understand that in the Act there is provision, I think next year, for a review of the workings of the nationalised electricity industry. Surely, if that review is to take place next year, that inquiry should be begun this year. It would, I know, give the greatest satisfaction to all hon. Members on both sides of the House who are interested in a fuel and power policy to know that that inquiry was to start without delay.

In conclusion, may I say that it is not our intention to harass and badger the nationalised industry simply for political reasons. Our object is, and always has been, to try to ensure the most effective use of our fuel and power resources in the national interest. From the local examples I have given covering the interests of a comparatively small part of the country, but which I believe to be representative of the problems of the country as a whole, I do not believe that the present situation is impossible of improvement, and the steps which can be taken to make that improvement seem to me to be urgent in the extreme.

11.58 a.m.

Mr. W. F. Deedes (Ashford)

I am very glad to be able to support my hon. Friend the Member for Colchester (Mr. Alport) on the necessity for electricity for rural areas. In such cases, I find myself, as perhaps many hon. Members do, acting much too often in recent years as an agent for despairing clients who have negotiated in vain for many months with their local electricity boards for the installation of electricity in areas where electricity is difficult to get. Nobody expects that all the claims which are made by individuals or groups of individuals in outlying rural areas can be met by the local boards. I have some experience of the local circumstances in East Kent, and I know the difficulties from the board's point of view, but I should like to underline the point made by my hon. Friend on the question of the priority on which the board itself allocates electricity in response to demand.

The balancing of the industrial domestic and agricultural considerations seems to me very difficult to follow. There is no doubt that, in some of the outlying farms electricity is a prime aid to efficiency. Indeed, the need for electricity, which is stressed over and over again, is not reduced because the farm is inaccessible. There are a great many farms in such areas that are not easily tackled by the board for the supply of electricity, but it does not reduce their need.

The second point concerns the machinery for negotiation between the individual or groups of individuals and the board for the installation of electricity. It is baffling to many of them, and most protracted. The common form is that the people on half a dozen farms get together and put forward a scheme. They get an estimate, and examine it, and then they find that there is what I would term a kind of capital levy—a sum of money which they are expected to produce between them towards the payment, and, on that basis, the estimate is met. After that, they bargain among themselves for the distribution of the capital outlay. By that time, all too often, the estimate has gone up. However, a final figure is agreed, and then there are months of delay before the scheme begins.

In recent months I have had several examples of that, one of which, I know, the Minister is aware of. I think we all accept the need for single control, but it carries with it this drawback. In all these difficult rural schemes no one can get a competitive tender, and when I look at the estimates originally given and then at the revised estimates six months later I sometimes question how the sum was arrived at. It is entirely in the hands of the board, and the basis of their calculation is unknown.

I think it would be a good thing if the consumer could know a little more about the basis of the board's calculation and about the capital cost of installing electricity. Once or twice I have been led to the suspicion that the estimate was deliberately discouraging, and in one instance, as I pointed out to the Minister, an estimate was so high that it was obviously beyond the pockets of the customers concerned. I was assured, however, that there was no deliberate policy of discouragement. This particular scheme has not been started, and I do not think it will be.

No one expects uniformity in all areas, but I want to suggest two possible improvements. The first is that for the rural consumers, particularly the agricultural interests, more information should be available both as to the basis of the board's priorities and the basis of their calculations. It would remove a source of suspicion and distrust if people knew how these estimates were arrived at. My second suggested improvement—this was dealt with earlier this morning—concerns the question of consumers' representation and making it possible for agricultural interests to have rather more say in what is so important to them. This is supposed to be a utility service, but in many rural areas it is, unfortunately, still regarded as a luxury or a privilege, and an expensive one at that.

12.5 p.m.

The Parliamentary Secretary to the Ministry of Fuel and Power (Mr. L. W. Joynson-Hicks)

If the House will accord me the privilege of being allowed to speak a second time today, I shall be glad to reply to my hon. Friends. My hon. Friend the Member for Colchester (Mr. Alport) opened this debate in a very helpful way. This problem of electrification is exceedingly difficult and serious, and in the national interest it is of urgent moment to proceed with its solution as fast as practicable, but the emphasis is on the word "practicable."

My hon. Friend asked me three specific questions. The first was rather a local question, with which perhaps I might deal straight away. He quoted the special case arising out of the tender offered to Colchester for the wiring of a housing estate. The House will recall that he said the electricity board insisted that there should be two power points put into each house. I do not think my hon. Friend can have quoted that quite exactly, because the board has no power to insist on that sort of thing.

Mr. Alport

If I gave that impression, I was wrong. The board, it is perfectly true, gave an alternative to the effect that an increased capital charge should be applied to the installation of the electricity supply for the housing estate. This was, in fact, the alternative which was more favourable to the council, and, therefore, the council naturally in their own interest accepted that alternative.

Mr. Joynson-Hicks

I am grateful to my hon. Friend for that intervention for it has saved me the trouble of suggesting that that is what really happened. That is what I had anticipated. The point I want to make is that this form of procedure is by no means new on the part of the boards. It is a continuation of the custom of the old authorities who were faced with exactly the same problem. They had to make their business pay just as the boards have the statutory liability of making their business pay, and, therefore, if they are going to tender for the introduction of electricity, they have to provide in one way or another to meet the costs of installation as well as of supplying the current.

There are two ways in which it can be done. They can either charge straightaway a fee for meeting the installation costs—and, as my hon. Friend pointed out, the local authority who would have had to meet that charge did not appreciate the suggestion one whit—or they can throw the charge on to the consumer by ensuring that he shall consume as much current as is calculated to give an overall profit on the whole of the installation. That is a very big and difficult problem because the objections to such a course are, in the national interest, exactly what my hon. Friend has pointed out.

That rather leads to the second question he asked me which was, who decides about policy? In the long run, of course, the Government decide about policy, but in the immediate present, and in replying particularly to the suggestion made by my hon. Friend that there should be some inquiry into this matter, I would remind him that an inquiry is being made into it at the present time by the National Fuel Policy Committee, generally known as the Ridley Committee, which was set up last year by the late Government and which is now well into its stride in investigating what is the best and most economic way of co-ordinating the fuel policy in the national interest. We very much hope that within a matter of months that Committee will be reporting, and in the light of that report it may well be that my right hon. Friend may desire to pursue the matter further, or that the problem posed by my hon. Friend will be solved as a result of that inquiry.

Mr. E. Shinwell (Easington)

Is the Ridley Committee dealing with this subject of the development of electricity in rural areas? I thought their inquiry was confined to the overall subject of a national fuel and power policy and the possibility of co-ordination, but I was not aware that they were dealing specifically with the development of electricity in rural areas. I would beg the Minister to influence his right hon. Friend to see that this matter of the development of electricity in rural areas is speeded up, because one of our purposes in nationalising electricity was to ensure the speedy development of such supplies, particularly to farms and homesteads in the countryside.

Mr. Joynson-Hicks

I appreciate the intervention of the right hon. Gentleman. I do not think it would be possible to produce an effective co-ordinating policy for the fuel and power industries in this country which omitted to take into consideration the rural development of electricity. But that was not the specific point to which I was referring and which was a matter that was bound to be inquired into by the Ridley Committee—the point made by my hon. Friend about the cost of the installation of electricity on housing estates leading to an excessive consumption of electricity.

On the question of rural electrification itself my hon. Friend specifically asked for clarification of how the decisions were taken, and by whom and through whom, and that is the question which I should now like to try to answer, because, I think, it is important that the House should see the way in which these things work. First of all, the area boards consider what development should take place. The area boards, when they have formulated their proposals, then go into consultation with the British Electricity Authority, and they discuss a co-ordinated scheme for the country as a whole. Then the conclusions at which the Authority and the boards arrive are put into the programme of development for the industry as a whole, which the Authority submits to the Minister, because under Section 5 (2) of the Electricity Act of 1947 the Minister's approval is required for capital development throughout the industry.

That programme takes into account the needs of rural development—as, indeed, it must, because it is a statutory obligation, as the right hon. Gentleman was indicating just now, that the nationalised industry as a whole should proceed with rural electrification and development. The Government, having received this programme. have to take into account the needs of the country as a whole and the national interest with regard to the expenditure on capital development which can be allowed to this particular industry.

It may be of interest to the House to note what, in fact, has been spent on rural development during the past few years. Eventually, when the decision has been made about expenditure, it is the area boards that expend the money, and the expenditure by the area boards on rural electrification in 1949 was 4.4 million; in 1950 it was £4.8 million; and in 1951 it was £4.9 million. The planned expenditure for 1952 was £5 million, and for 1953 it was £6 million. So the House will see that the plans for rural electrification were steadily developing.

An interruption to this programme occurred in the middle of 1951, when the late Government, as the right hon. Gentleman will, no doubt, recall, cut the British Electricity Authority's proposals—the development programme—by deciding that no new rural electrification could be started before the end of 1952. Accordingly, the programme was cut by £ million, which was the estimated amount which the boards would spend on starting new schemes of rural development. Therefore, the planned expenditure of £5 million was cut to £3 million so as to enable the schemes which had already been started to be continued.

That was the situation when the present Government took over at the end of last year. The House will recall—there is no need for me to elaborate it—the serious economic situation of the country at the time. It would, therefore, I think, have been justifiable for the Government to have continued the same policy of restriction with regard to rural electrification that the late Government had decided upon last year; but, despite the even greater need of the country for limitation of capital investment, the present Government attached so much importance to the needs of the country districts as a whole, and to the acceleration of the development of electricity in country areas, that they decided to restore for the current year £1 million of that which had been cut by the late Government, so as to increase the total sum to £4 million and enable the boards to start fresh schemes to that amount.

That is how, in fact, the arrangements work out. When the decision has been taken by the Government on the total amount of capital investment for the industry, it is passed back to the B.E.A., and, as a result of the consultation that has taken place, the allocation that has been made by the B.E.A. to the area boards is, in each case, dispensed by the area boards upon their own schemes.

Let me refer to the results in North-East Essex—because that was particularly what my hon. Friend referred to, and his own constituency. I have obtained certain figures showing the results in that area, and particularly in the Colchester district, which, I think, will be of interest to him particularly, and, I hope, to the House generally. In the years 1948–49 there were some 40 farms connected in the Colchester district. By "farms" I mean farms, and not rural schemes. In the next year, 1949–50, there were 41; 1950–51 showed a beginning of the effect of the late Government's cut by the limitation of the starting of new schemes, and there were 31 new farms connected; in 1951–52, on the calculations which the board made resulting from the cut, it was estimated that there would be 25.

The total number of farms connected for the whole area show very much the same line: 1,529 in 1948–49; 1,277 in 1949–50; 1,149 in 1950–51; making a total during the three years of 3,955 fresh farms connected to electricity supply. I think the House will agree that that is quite a considerable number. The year 1951–52 again showed a similar falling off to a figure of 835, but during the period since nationalisation the Eastern Electricity Board has connected altogether 210,000 new consumers, and out of that 210,000 there are included 600 villages and hamlets, and, as I say, just on 4,000 farms.

Those are the figures, from which, I hope, my hon. Friend will derive some consolation. Even if they have not been brought to his notice, there has, at any rate, been a substantial number of farms in his area connected up to the electricity supply. I must, however, confirm what he was saying, that in the Colchester district itself there are still 16 schemes which have already been approved and which are waiting to be connected. In addition there are some 50 inquiries which have been received, mostly from rather isolated places, and these have not yet been allocated to any particular scheme.

The total capital expenditure on rural electrification by the Eastern Electricity Board is a figure which, I think, will be of help to my hon. Friend. In 1951–52—the year of the cut—they spent £231,000. For 1952–53, that is after the restoration of the £1 million by the present Government, the figure for rural electrification, which they have allocated after consultation by the Authority with the boards is £312,000. That shows that the Eastern Electricity Board had slightly more than the average share of the additional £1 million.

I should like to refer to another point which my hon. Friend made with regard to detailed decision on the rival merits of the claims of different applications to be connected with a supply. That is a great problem. There are great difficulties in deciding upon the necessary priority, but that is a job which is primarily one for the area boards. When they have considered their programme they discuss it with the Authority, and ultimately it comes to the Minister for approval in the form of a development programme.

The boards have to take into account the national interest, particularly defence requirements for electricity and the requirements of increased productivity.

They have to look at the matter from the broadest national aspect and also from the point of view of capital investment, and to consider whether or not they can afford to link up an isolated place, which will consume a lot of capital in the way of wires and poles and so forth, or whether they can do a more satisfactory job by linking up consumers where connections can be made to existing mains and feeders.

Then there is the question of being able to do the greatest good to the greatest number. That is a priority which must necessarily be taken into account when dealing with rural electrification, because clearly they can do greater good by connecting a housing estate than by connecting a single, isolated farm in a rural area.

Then there is the over-riding necessity of the obligation to pay their own way. In that connection they have to take account of the fact that in providing electricity to an urban area they can link up 300 consumers per mile, whereas in rural areas the number may be as low as 10 consumers per mile. Then there is the ever-pressing problem that about half their expenditure has to go into reinforcement of existing plant and equipment, to prevent any possibility of any breakdown.

By and large, if I may return to the picture for the country as a whole, the situation is that prior to nationalisation there were 81,500 farms connected with electricity. That is an important figure, because we are sometimes inclined to think nowadays that there was never any rural electrification prior to nationalisation. But there was that substantial number of farms connected on 1 st April, 1948. Since then, up to 31st December, 1951, that total has been increased to 117,000. But those of us who represent agricultural constituencies are all too well aware that there are something like 300,000 farms in the country. So we have still a very long way indeed to go.

I ask my hon. Friend to recognise that we are not in any sense of the term at all complacent in this matter. We realise the urgent need for rural electrification. but at the same time we hope he will appreciate some of the great difficulties which are facing the boards in carrying. out this important statutory obligation.