§ The Chairman
In order to put the first Amendment in the name of the hon. Member for Oldham, West (Mr. Hale) in order, a consequential Amendment providing for an alteration of the Title will be required. I understand this has been prepared and that the Amendment can now be admitted.
§ Mr. R. T. Paget (Northampton)
I beg to move, in page 1, line 13, to leave out paragraph (b).
I am most grateful for the acceptance of this manuscript Amendment to alter the Title of the Bill. When I prepared my original Amendment I did not realise that it was a matter of agreements with several countries, and my Amendment would confine it to one country. Therefore, the plural in the Title would become singular by my Amendment.
The Bill seems to me to raise constitutional questions of very great importance indeed. The law of our Constitution provides that the treaty-making power shall rest with the Prerogative; it shall be exercised by the Executive. But the treaty-making power is a power which cannot affect the rights of the ordinary, individual citizen.
No contract or treaty made by the Government of this country with another country can affect the ordinary rights of an English citizen, can affect his contracts, or can affect his freedom. For the rights of the individual to be taken away from him requires the consent of Parliament in legislation passed for that purpose. By this Bill we are being asked to abrogate that ordinary right of the citizen, not merely as to an agreement which has been made, but as to any agreement which the Government may make and which we do not even see. That is the striking innovation of this Bill.
It has been customary, and there are a good many examples in the past—there were some after the 1914–18 War 528 —to treat insurance contracts made with nationals of a nation that subsequently becomes our enemy, in a different way to ordinary contracts, and to revive those insurance contracts by subsequent agreement.
§ Mr. Leslie Hale (Oldham, West)
Will my hon. and learned Friend forgive me for a moment? I am most reluctant to interrupt him in the full flight of his oratory or, as it were, to wing him at this moment. Normally, we are told what the Amendment is before we hear the remarks. I should be grateful to know what the Amendment is, because I am so much in the habit of applying my mind in that direction that I am finding it awfully difficult to understand my hon. and learned Friend's introductory remarks without knowing what the Amendment is to be.
§ Mr. Paget
I am grateful to my hon. Friend for his question, but it is not very easy to understand what the Amendment is until the principle of the Amendment is explained. The Amendment is, quite simply, to leave out paragraph (b) of Clause 1 (1). Paragraph (b) gives to the Government power to make agreements in the future which we do not see and some of which have not, I understand, yet been negotiated, and to allow those agreements to affect the right of ordinary citizens. That is the effect of this agreement.
It is customary for nations—at least, it is a fairly recent custom; there are precedents—for nations to come to agreements subsequently to a war to give effect to insurance contracts which were made before the war and which, in accordance with the normal law, would have ceased to exist when the parties to the contracts became enemies.
An agreement to that effect has been come to with Finland. That agreement, being an agreement between the British Government and the Finnish Government, does not affect the right of any party to any of those insurances by itself. It can only affect these individual rights when we in Parliament so provide, because only Parliament can affect the rights of individual British citizens. Now, the agreement having been come to with Finland, then it is perfectly proper for the Government to come to the House of Commons and ask the House to give legal effect to that agreement which has 529 been come to; because, otherwise, the agreement is futile since it would not affect the rights of individuals.
In a subsequent new Clause, which I hope to move later, I shall propose that these provisions affecting individual rights ought to be put into the Bill and thus become an Act of Parliament. Whether one does this in that way, which I think is preferable, or whether one does it by authorising the Government to legislate by Order in Council, one still has the agreement. One knows what the agreement is, and one knows what are the rights of individuals whom one is affecting; and one can ask those individuals who are having liabilities created which did not exist before, and are having rights given them which did not exist before, whether they have been consulted and what has happened.
But, for the Government to go further, and say, "Not only do we ask you to give legislative sanction to what we have agreed, but we ask for a blank cheque as authority in advance to take away the rights of individuals and to create liabilities which did not exist before in accordance with any agreement we may come to in the future," is going further than, I think, this House has ever gone in the past. Moreover, it is going further than it ought to go. The proper procedure is to wait until the agreements are made and if, when made, they affect the rights of individuals, and to make them effective legislation will be required, then legislation can be come to.
I put it to the Committee that it is wrong to ask us to surrender our rights as guardians of the individual and to authorise the prerogative to step beyond the bounds by which it is limited, and has been limited, throughout the growth of our Constitution. To allow prerogative without legislation for the creation of liabilities for individuals, and to take away rights which have existed, and to create rights between citizen and citizen which did not exist before, is something which, in my submission, must not be allowed by this Committee.
§ Mr. Hale
I am sure that the Committee is grateful to my hon. and learned Friend for the clear and lucid way in which he has put this very important point and for the way in which he has called attention to this 530 most strange abrogation of principle. The agreement was made in 1949; some three years ago. No doubt it was one which presented some difficulties in negotiating, because the Committee will notice that the effective date is August, 1941—some 11 years ago.
We are, of course, not dealing with the period when the gallant Finns were dealing with the wicked Russians, but that period when the wicked Russians were fighting with the gallant Finns. When we come to the other agreement, it may be that the complexity of the period, when we were rushing arms to the Finns, will give rise to some difficulties in the field of all insurance and arouse our curiosity on the change—and some might say the unmerited change—from allies to declared enemies.
My hon. and learned Friend has put the point with such clarity that there is very little left for me to add. I do agree with him, and it seems to me to be a most incredible proposition that the House should be asked to give a blank cheque to the making of these exceedingly complex agreements.
This particular agreement is one which contains 24 clauses, some of them of the greatest possible complexity. Indeed, I venture to say, with all due respect to the hon. and learned Gentleman who, speaks with such authority on these matters, that I very much doubt whether half-a-dozen people in this House could really explain in detail just what is the effect of this particular agreement in the field of re-insurance alone. At the appropriate time, I may have to ask the Parliamentary Secretary some questions upon that point.
What the Government in effect are now suggesting in this paragraph is that, in making agreements in future, complex and detailed as they may be, each and every clause of which will inevitably vary the contractual rights—and heaven knows we have been lectured enough by people opposite on the sanctity of contracts and the undesirability of upsetting contractual rights and the need for the limitation of the power of the State to interfere as between citizen and citizen—we are not going to worry about the solemnity of contractual obligations.
We shall say, by this paragraph (b), that there shall be power by Order in 531 Council to make confirming Orders validating one or more of a series of international agreements—long, detailed, complex agreements, affecting the contractual rights of people in all parts of the world, that cannot be subject to amendment, that will be, under a later Clause, subject to affirmative Resolution of each House, but which cannot be varied, criticised in detail or be subject to amendment, but which will be brought before the House in such a way that we shall have no right whatever to raise any of the really complex matters that arise upon them.
There is no guarantee that the agreements will be in the same or similar form, that the same principles will be applied, or that the same view will be taken of a contract of insurance, or that the vast complexity of matters dealing with marine insurance, aviation insurance, war and life insurance will be dealt with in the same way. It is now said "No, all that we are going to say is that, not merely that an Order in Council can be made to confirm, but also to add a whole variety of other matters," which it may not be appropriate to discuss at this moment.
My hon. and learned Friend has put down an Amendment which may give us a chance of raising some of the curiosities that may be incorporated in the Order in Council, including the right to give an individual citizen exemption from Stamp Duty provided by the Stamp Act; in other words, to make discriminating taxation in an Order in Council.
That is a quite indefensible proposition, and I would have said that it was completely indefensible coming from any political party, but, coming from the party which preached the sanctity of contracts, it is quite the most extraordinary proposition that has ever been put before the House.
I ask the hon. and learned Gentleman really to consider the matter. What would be the effect of leaving this Clause out? It would merely be that the Government would come along with a one-Clause Bill, producing the agreement as before, and at least giving us the right to do what we have done now and seek to put into the Bill details so that they shall be available for the consideration of the House and for the consideration of all those 532 people charged with the important duty of administering and interpreting these complex provisions.
That is all that is suggested. Surely, it is eminently reasonable that when this Government or any future Government negotiates a detailed agreement the House should have some control over it and some right of criticism of it, and certainly some right of amendment. Even under the procedure tonight Her Majesty's Government have taken a course which appears to be designed to limit our rights of amendment as much as possible. Even under that procedure we do not have embodied in the Bill the terms, and have them so embodied that they are subject to amendment. But that is a matter which I can elaborate more fully on an Amendment in the Committee stage.
That itself might be a matter for protest, but to suggest that we are going to embody by reference agreements not now negotiated, agreements to be negotiated by some Government in the future, agreements without any limiting rights at all about what details will be inserted and in which the only provision that has to be made is that they are agreements which have been agreed to by the representatives of the two Governments concerned, is certainly something to which we cannot agree.
There never was a more crude or a more oppressive assertion of the rights of the Executive against the rights of this House. I would challenge the recollection of the oldest Parliamentarian here to say whether there has been a more flagrant example, not merely of delegated legislation, but of the delegation of a general power to do things in future.
I remember in the 1945–50 Parliament we had many a long debate on the question of retrospective legislation. I have noted that the opinions and views of right hon. and hon. Gentlemen opposite have altered somewhat since they took office. That is a very natural thing. To some extent I have noticed it happen on this side of the House, but not to the same extent. But I certainly have never heard anyone argue in this House that it would be a good thing not merely to have retrospective legislation, but to have legislation for the future, legislation conferring and delegating power for future action over a wide field and thus depriving the 533 House of the right to consider the agreements made.
It is adding to the power of the Crown. It is 180 years since the House passed legislation saying that the power of the Crown was to be diminished. If we are to go back to the time of Wilkes for our progressive views and if now it is really the view that we should add to the power of the Crown, and add still more to the wide variety of treaty powers over which this House has so little control and little more power than to say yea or nay in the approval of the Government of the day, then it seems to me there ought to be the most serious protest we can make. I am grateful, and I think the whole Committee is, to the right hon. Gentleman for having raised this exceedingly important point.
§ Notice taken that 40 Members were not present; House counted, and, 40 Members being present——
§ 11.0 p.m.
§ The Parliamentary Secretary to the Board of Trade (Mr. Henry Strauss)
I should like to assure the hon. Member for Oldham, West (Mr. Hale) that I have not altered the views I expressed on constitutional questions at a period when I was in opposition. I should like also to say, in defence of the right hon. Member for Colne Valley (Mr. Glenvil Hall), and of the leaders of his party in another place, that they have not been so careless of constitutional propriety nor mistaken their duties in the way that has been suggested by the hon. and learned Member for Northampton (Mr. Paget) and the hon. Member for Oldham, West.
I am sorry that neither the hon. and learned Member for Northampton nor the hon. Member for Oldham, West was present, I think, when I explained this Bill in the Second Reading debate. I regret that because a good many misconceptions which they seem now to entertain would, I think, have been removed had they heard the explanation. But, let me say at once that I welcome the fact that they very properly concerned themselves with constitutional principles in a Bill of this kind. The effect of accepting this Amendment, however, would be to limit the operation of this Bill entirely to the case of the Finnish Agreement so that when an almost precisely similar agreement was made with any other Power, which was an enemy in the late war, a further Act of 534 Parliament would be necessary. We shall all agree that that would be an unnecessary and foolish procedure unless it were required on the grounds of justice or the necessity of Parliamentary control.
I concede at once to the hon. and learned Member for Northampton and to the hon. Member for Oldham, West that if it were necessary on these grounds, I should not be resisting this Amendment. In an occasional passage in the speeches of the hon. and learned Member for Northampton and the hon. Member for Oldham, West they seemed to think that this Bill enabled the Executive to enter some agreement which the Executive was not already able to enter. That, as I know the hon. and learned Member for Northampton would agree, is not so. This Bill is necessary for the purpose to which both hon. Members have alluded, namely, to give legislative effect to the agreement, when it has been reached, in the sense of making it part of the law of the land, thus, as the hon. and learned Member for Northampton says, affecting the rights of individuals and so forth.
Under this paragraph (b), which it is sought to delete, nothing whatsoever can be done without the express approval of each House of Parliament. Without such express approval no change in the law can be made. The idea that the hon. Member for Oldham, West has that there is some great new invasion of private rights, possibly uncontrolled by Parliament, is, therefore, completely incorrect. There is one power, and one power alone, that the House will not have, and that is the power to amend. I agree that, while the rights of Parliament are fully secured by the legislation, it is subordinate legislation, which does not enable the House to amend. But, if the Members of the Committee will think about the matter a little more deeply, they will see they are losing nothing thereby. There never has been power to amend treaty provisions dealing with contracts of insurance.
As I explained on Second Reading, in the treaties after the first World War, such as the Treaty of Versailles, contracts of insurance were dealt with by special provisions in the Treaty itself. Then subsequently there was an Order in Council to make the required change in English municipal law. After the recent war a different procedure was adopted in the case of many of these treaties, which dealt with ordinary contracts but left agree- 535 ment regarding contracts of insurance to be negotiated subsequently. Such an agreement has been negotiated in the case of Finland, and substantially negotiated in other cases. In the case of Finland, it has been embodied by an interchange of letters in a Government agreement, which it is sought by this Bill to carry into law through an Order in Council.
The fact that the House loses nothing through the inability to amend is obvious from the fact that, if an agreement has been reached between two nations, either nation can refuse to give effect to that agreement but neither nation can possibly proceed to amend it unilaterally without making the whole thing futile. Let us take the Finnish Agreement for example. The House is not parting with the control it has over the rights of British subjects even when the Bill has passed, because the Order in Council has got to come up as an affirmative Resolution, and it must then be either accepted or rejected. There would be no point whatever in the Government negotiating and making an agreement, and then saying that one side could unilaterally amend it. Does the hon. Member for Oldham, West wish to intervene?
§ Mr. Hale
I only want to make a perfectly simple point. The hon. and learned Member is perfectly right. Once this agreement is made—and it was made in 1949, which is three years ago—it is exceedingly difficult to amend it, because that would affect international friends and international relationships. But it was negotiated three years ago, and under that agreement not any rights of a single Englishman can be affected until this House passes the Bill in all its stages. The contractual rates are not affected by the Bill because the Government have not the power to do it.
If the Government enter into an agreement which this Committee thinks unfairly or improperly affect the contractual rights of the citizens of the country and incorporate that in a Clause of this Bill, which this Committee rejects, it will then be for the Government to consider whether they should resign or not. I would not express any opinion as to whether the hon. and learned Gentleman would see any advantage in such a course, but I must confess that I see many.
§ Mr. Strauss
I want to be fair to the argument advanced by the hon. Member, for I understand how deeply he feels about it. Her Majesty's Government can make a future agreement with any other country, as they have made past agreements, without coming to the House of Commons at all. The question is the method by which the matter should come before the House. There is nothing novel in essence in what is proposed now. After the 1914–18 War what was required was achieved by Order in Council under the Treaty of Peace Act. It will be achieved in the case of the Finnish Treaty by Order in Council, and in the case of those other treaties with which this present paragraph which it is sought to delete is concerned, it will be achieved by Order in Council.
If the House of Commons does not like the agreement, it will have no power to alter the agreement but will have absolute power to refuse to make it part of the law. The House will have the utmost power that it can possibly require. The House cannot by its action alter the terms of an international agreement. Whilst I appreciate the care for constitutional principle which guided hon. Members opposite to concern themselves with this paragraph, I assure them that it gives no wholly novel power to the Executive to put anything in the law of the land without the control of Parliament.
We are not driven by any consideration of justice or constitutional propriety to do what every Member of the Committee would realise would be quite inexcusable to do unless we were compelled, namely, to have the necessity of an individual Bill for every agreement of this kind that is made. They are all more or less in the same form.
§ Mr. Strauss
I suppose that is a joke, and no doubt it will be explained to me why it is funny. But it is quite clear that I am advising every hon. Member, however much he concerns himself with questions of constitutional principle or constitutional questions, that there is no merit whatsoever in the Amendment.
§ Mr. Paget
The Minister is giving that advice owing to a complete miscon- 537 ception, which I think I shall soon be able to explain to him. He said at the commencement of his speech that if, in fact, the rights of the House of Commons as to the protection of individuals was being taken away he would accept the Amendment. I hope he stands by that undertaking which he gave to the Committee at the beginning of his speech.
I will now show him how this provision does take away from the House of Commons the right to protect individuals. The whole assumption of his speech and his argument was based as follows, as he put it: this Bill simply empowers the Government to make treaties and agreements which it makes with another Power binding upon the individual citizen. The right to make the agreement with the other Power is not affected by this Bill. This Bill simply enables the agreement which is made to be binding upon individuals.
If this were so, I should agree with the Parliamentary Secretary. But this Bill does much more than that. Of course, when an agreement has been negotiated with another country, it cannot be amended unilaterally here. But look what the Bill does:Her Majesty may by Order in Council do all such things as appear to Her to be necessary for carrying into effect——It then goes on to say:Without prejudice to the generality of the preceding sub-section, an Order in Council under this section giving effect to any such Agreement as aforesaid may make provision for transferring, by virtue of the Order and without any liability to stamp duty, to such persons as may be determined by or under the Order any rights and liabilities vested in a custodian of enemy property which arise under contracts of insurance or reinsurance to which the Agreement relates.11.15 p.m.
There, immediately, is something which is not in the agreement, but which is a manner of affecting individual rights to give effect to it. There may be a variety of ways, affecting rights differently, which are means of giving effect to the agreement. The Government makes an agreement; it cannot be amended. They now take power to affect people's rights to give effect to it. The whole variety of ways in which people's rights are affected operate the agreement. The Finnish Agreement is an example. The Orders to be made here are not simply Orders setting out 538 the agreements that the Government makes with a foreign Government they are Orders empowering him to make all sorts of supplemental provisions affecting the rights of individuals, so that the Government may choose their particular way of affecting particular rights in order to effect the agreement.
The Parliamentary Secretary must now see very clearly that the whole basis of his argument—that the agreement cannot be amended—is without any validity, and I ask him to fulfil his undertaking and accept this Amendment.
§ Amendment negatived.
§ Mr. Hale
I beg to move, in page 1, line 22, to leave out from "Order" to the second "to," in line 1, page 2.
Subsection (2) of the Clause reads:Without prejudice to the generality of the preceding subsection, an Order in Council under this section giving effect to any such Agreement as aforesaid may make provision for transferring, by virtue of the Order and without any liability to stamp duty, to such persons as may be determined by or under the Order any rights and liabilities vested in a custodian of enemy property which arises under contracts of insurance or reinsurance to which the Agreement relates.The simple meaning of this Amendment is to eliminate the words "without any liability". I hope I shall have hon. Members with me on this point, which has been raised on previous legislation, when I am sure there was considerable sympathy with what I am seeking to do. To start with, if we are to make special provisions in relation to the relief from general taxation of individuals, it seems to me rather surprising that we should select what is generally regarded as one of the most profitable and remunerative of activities in the City of London.
But I should not like to base it on that ground; I would rather base my point on the simple one of equity. There has been an increasing habit in recent years, for which all parties are responsible and in which all parties in their turn have taken part, to exempt all sorts and sizes of Government Departments from the obligations that the Government so freely place upon all the other citizens of the country. Time after time we find that Departments, Ministers, secretariats, and so on, are exempted from the day to day liabilities which are exacted from citizens and, indeed, are calculated to exacerbate them.
539 We find that Ministers, civil servants and others seem to have no knowledge of what telephones cost these days, and so on. It is a bad principle. It will be said, and with some truth, that if they pay the Stamp Duty it is only charged to the Department concerned; it only means putting a figure on one side of the Revenue Account and then on another. I still think it a bad principle that we should have these special exemptions.
But this Clause goes much further than that. This is a proposal that an Order in Council, subject only to affirmative Resolution,may make provision for transferring, by virtue of the Order and without any liability to stamp duty, to such persons as may be determined by or under the Order any rights and liabilities vested in a custodian of enemy property which arise under contracts of insurance or reinsurance to which the Agreement relates.In point of fact I know that there is one problem in this matter which my hon. and learned Friend the Member for Kettering (Mr. Mitchison) could deal with much more effectively than I could because he has a much greater knowledge of this subject than I have. There is always an argument about the amount of Stamp Duty; there is always this controversy as to whether it is a general agreement or ad valorem and it often varies considerably. It may be a case of 10s. or £500, according to the magnitude of the transaction.
It is quite monstrous for the Government to come along—if that be their reason—and say, "Because we have never clarified this matter, because there has been argument and litigation about it, we propose to record the exemption rather than go to the trouble of laying down clear and unequivocal provisions which would enable the appropriate Stamp Duty to be ascertained." I am sure the hon. and learned Gentleman has far too much sense of logic to advance that argument, although I believe it is one which is never wholly absent from the minds of the Parliamentary draftsmen.
There is also the argument that there may be loss by reason of war and no one will gain. It is a bad principle to make provision for relief from Stamp Duty. I should have thought that one 540 of the things we boasted of in this country, and one of the things we have a right to boast of, is that on the whole—subject to the exception of Ministerial Departments to which I have already referred—each citizen is treated the same before the law, and equality before the law is a fundamental principle which is the basis of our system of justice.
It may sound extravagant if I say that if you push this argument to its logical conclusion you could make your Order in Council exempt individuals from Income Tax or from any other impost imposed by the Budget.
It is unfortunate that under our rules I could not refer to this matter in the course of the preceding debate. The Committee will remember that the Parliamentary Secretary advanced the point that there was no necessity to be able to amend the provisions of an Order because all it would do would be to embody an agreement which would not be valid. Now, when we move on a line or two, we find that an Order in Council is to vary the provisions of the existing law with regard to the collection of finance and the imposition of taxation. It is to make a special exemption.
I have no doubt the Parliamentary Secretary will say this has happened before. So it has, and on every occasion I have noticed it I have protested about it—and the hon. and learned Member for Northampton (Mr. Paget) has protested, too. Whatever Government has been in power we have opposed discriminatory provisions. I suggest that if the Parliamentary Secretary wishes to be co-operative and facilitate the business of the Committee this evening, this is an Amendment he could readily accept.
It would mean that, in dealing with these agreements, the ordinary law of the land would continue to apply, the Order in Council would give no right for special exemption, and so far as the liability for the disposal of enemy property is concerned—and I think in the main it would fall on those to whom the assets were being transferred—it would only be a question of balancing one figure in the ledger against another. However that may be, I can think of no reason for which the Parliamentary Secretary can resist this Amendment, which merely seeks to re-establish a principle which has already had too many abrogations.
§ Mr. G. R. Mitchison (Kettering)
I most earnestly hope that even at this late hour the Minister will see his way to accept this Amendment. I entirely agree with what the hon. Member for Oldham, West (Mr. Hale) has said, but I have two other reasons which may not have occurred to the Minister and which I now wish to put to him. The first is this Bill itself. It comes, of course, from another place and if that other place had by itself done what it proposes to us should be authorised by Orders in Council, or had suggested that it should be done, there would have been a clear breach of Privilege.
I do not think there can be very much doubt about it, but may I ask the Minister to look at Erskine May where he will find that as early as 1671:That in all aids given to the King by the Commons, the rent, or tax ought not be altered by the Lords.The proposal is to alter the incidence of a certain tax. The proposal it is true is that it should be done by Order in Council, but I will come to that in a moment. If it had been proposed in the Bill there would have been a breach of Privilege.
Erskine May also says:The Commons treat as a breach of privilege by the Lords not merely the imposition or increase of such a charge, but also any alteration, whether by increase or reduction, of its amount or its duration, mode of assessment, levy, collection, appropriation or management. …There is not the slightest doubt that this provision could not have been brought forward from another place in itself. Again, if one looks upon the following page it so happens that one of the instances given of the restriction of the Lords right to initiate a Bill is a case in which two Private Bills were laid aside because when sent down by the Lords they contained a Clause imposing Stamp Duty.
What is suggested here is that another place, which could not itself, without breach of Privilege, propose any exemption from Stamp Duty, puts before this House a proposal that an exemption from Stamp Duty should be authorised by Order in Council. That is a very easy way to get round questions of Privilege. One does not put forward the breach of Privilege; one merely puts forward a 542 proposal that it should be authorised by Order in Council.
The House of Commons is always very jealous, and rightly very jealous, of its rights in this matter, and if the Government are, as their Members have from time to time claimed, guardians of the Constitution, I can only say that I am ashamed of them for in any way conniving at this ingenious method of promoting rights in another place which that other place ought not to have.
After all, what is there in it? It has just been pointed out, quite clearly, that at the most this is a matter of accounting. Are we to have this carried any further beyond the point where it is a mere matter of accounting? What limits are to be put to it? If that which, obviously, when proposed as a statutory provision would be a gross breach of Privilege, is now to be proposed merely in the form of an authority to make Orders in Council, the technical rules as to Privilege may have been been successfully avoided, but they will have been avoided by a party which has used the machinery of Government to impeach the Privileges of the House of Commons. On that ground, I suggest that this provision ought to be dropped because of its place of origin.
The next point is even more serious. It has been touched on by my hon. Friend the Member for Oldham, West (Mr. Hale). This agreement, made, I notice, between British and Finnish insurers, deals among other matters with treaties of marine reinsurance—that is, in Clause 10; and in Clause 12 it deals with contracts of facultative reinsurance. The most remarkable thing about this treaty or agreement is that it appears to recognise what are bound to be illegal agreements under the law of this country.
It is not a question of how much Stamp Duty one puts on a treaty of marine insurance or a contract of facultative insurance. I need hardly remind the hon. and learned Gentleman, who will shortly be replying, that it cannot be stamped at all. It is an illegal agreement; it is not a valid contract of marine insurance because it does not state the amount insured. I am quite certain that that elementary proposition must have been very well known to all those who were concerned, not only as business men, but as negotiators in making these agreements.
543 I quite agreed with what has just been said that it is not within the power of the House to vary treaties, but when somewhat doubtful provisions of this sort are introduced we come to consider what the effect of this exemption from Stamp Duty is. What exactly is meant? Does it mean that the agreements themselves are to be exempt from Stamp Duty? Does it mean that there could be some Stamp Duty on the transfer of an agreement which itself cannot be stamped and is, therefore, invalid? I should like a clear answer on both those points, and I hope that the Parliamentary Secretary will go a little bit further than he has.
I have already called attention in the House to the absurdity of continuing the provisions which make these contracts which have been in use in the City of London for years and decades and which are unstampable and, therefore, illegal, and which deprive the Revenue of duty. To have that position at a time when we are all being asked, and indeed, urged, to collect as much for public funds as possible and then spend it as prudently as we can, is something which ought not to be. To waste a potential tax in this way, while wasting the time of Parliament by introducing some of the Measures we have had to discuss lately, when the time could be more profitably used by legislating for tax collection, is something I cannot understand.
I cannot mention all those Measures; the Licensed Premises in New Towns Bill is one. But to lose this revenue seems to me to be an improvidence of administration and a folly of legislation of which only the present Government could be capable. But, there it is. The broad evil remains. The particular omission could be rectified, but so long as it stands, then this exemption from Stamp Duty is not merely to be put in for convenience, but in order to get public authorities concerned out of what otherwise would be an inextricable and hopeless mess. That kind of thing should not be done. When it is within the power of a Government to introduce legislation remedying such a mess, it merely deals with it on each relative occasion by giving a special exemption.
If I may say so, I am particularly glad to see the Parliamentary Secretary to the Ministry of Transport in his place, for he was singularly lucid in his excusions into 544 the realms of marine insurance on a recent occasion and delighted us all. If his right hon. Friend, the Minister, would only consult with him, I am sure he would say, "My boy, get rid of this mess in a sensible way. Instead of having something in each Bill have one provision designed to prevent the Government, and its servants, from putting its foot into the mud in which the City of London has wallowed for so long."
§ Mr. H. Strauss
I assure the Committee that the effect of the words it is sought to delete is not to make a major change in the law regarding the stamping of documents. Perhaps, in order that hon. Members of the Committee may have some idea of the subject matter with which we are dealing, I might repeat part of the speech I made on Second Reading when dealing with subsection (2). I then said:Subsection (2) provides a convenient way of dealing with these facts. Under Orders made under the Trading with the Enemy Act, the interests of Germans in insurance contracts were vested in the Custodian of Enemy Property. This subsection enables those interests to be transferred back and that can be effected by a general revesting provision."—[OFFICIAL REPORT, 25th July, 1952; Vol. 504, c, 1047]It is obviously convenient, in order to carry out, for example, the Finnish Agreement, that the various assureds, whose interest is vested in the Custodian of Enemy Property, may again be put in possession of that interest. It has nothing whatever to do with the stamping of a contract of insurance. What we are concerned with is whether a document re-vesting those interests shall bear a stamp, and it is above all necessary that it shall be clear whether the document shall bear a stamp or not. I say that it is obviously convenient that it should not bear a stamp.
If a single re-vesting Order is to cover the cases of hundreds of assignees, how would it be possible to collect a tiny proportion of the stamp from each assignee? It is a far more convenient proposal, and far more in accordance with the precedents set by all Governments, to have a simple provision that there shall be freedom from Stamp Duty.
I will quote only two examples to the Committee. One I remember well, because it is a precedent set by the wartime Coalition Government and because it happened on the first Measure which it was my duty to conduct through this 545 House—the Minister of Works and Planning Act, 1942. There, a precedent will be found in Section 5 (5); but let me give another precedent from the legislation passed by Her Majesty's present Opposition. In the Finance Act, 1946, hon. Members will find a precedent in Section 52 of which the marginal note is "Exemption from Stamp Duty of documents connected with nationalisation schemes." I am sure hon. Members opposite will think that a most respectable precedent.
There really is an obvious convenience in these statutes making clear that the Order in Council can allow this re-vesting without the document having a stamp. It is a convenient course, it is the right course, and it is a course with many precedents. I say the provision in the Bill is right, and I ask the Committee to reject the Amendment.
§ Mr. Mitchison
Will the hon. and learned Gentleman answer the rather serious constitutional point about Privilege, to which I devoted some considerable time and to which he has made no reply whatever? With regard to the point to which he did seek to reply, may I ask him to answer one question which I asked him? How could you have stamped these documents anyhow, and what would the Stamp Duty on them have been?
§ Mr. Strauss
If it were as difficult as the hon. and learned Gentleman suggests to ascertain what the Stamp Duty would be, that would seem to me an additional reason showing the wisdom of the Government in providing that there shall be none. On the question of Privilege, I must say that, although I have made some study of Privilege on many occasions, I would never venture to make such confident statements regarding Privilege as the hon. and learned Gentleman made; but I am fairly confident that, had there been a breach of Privilege by another place in regard to this Measure, Mr. Speaker would have brought it to our attention in the usual manner.
§ Mr. Mitchison
With respect, the hon. and learned Gentleman has quite misunderstood me. I very carefully said that a breach of Privilege had not been committed. I did not for a moment suggest that it had. What I was pointing out was that this was an ingenious 546 and undesirable way of enabling another place to raise questions which if raised in a straight form would involve the most serious breach of Privilege, and that suggestion remains entirely unanswered.
§ 11.45 p.m.
§ Mr. Strauss
On that I at once plead guilty of having misunderstood the hon. and learned Gentleman, and for that I apologise. He has made his point, and made it twice. I can only express my view that there is nothing in it.
§ Mr. Glenvil Hall (Colne Valley)
Surely we cannot leave the matter there. I think my hon. and learned Friend put the point in all seriousness and that it calls for a more courteous reply than the Minister has given up to now.
In a few minutes we shall be discussing the Motion "That the Clause stand part of the Bill." That will, I think give the Minister time to consider the point. I suggest that there is no reason why we should engender heat in this matter. It is a matter of general interest to the Committee. I suggest in all seriousness and with all good will that it would be as well to clear up the point if we can, and if there is an answer that it should be given to us tonight.
§ Mr. Strauss
If I was guilty of any lack of courtesy, I certainly apologise; but I may say that the hon. and learned Gentleman and I are fairly old personal friends, and I do not think that either of us is averse to hard hitting. It may be my folly, but I can detect very little in the point. That may well be due to the weakness of my intelligence. If, perhaps, at a later stage I can add anything on this point I will do so.
§ Mr. Hale
I am sure that the Parliamentary Secretary has tried his hardest to be courteous and to explain the matter. But it seems to me that he has only succeeded in making confusion a little worse confounded on the main issue because, if I understand his explanation, what he is saying is that the only document with which we are concerned is the Order in Council. There will be power under it to make a general transference of rights and of enemy property.
I really thought that what he was saying was that the Order in Council would deal with the whole matter collectively and that therefore we were not 547 affecting individual rights in the way I suggested. The answer is that in no circumstances would an Order in Council bear a Stamp Duty.
§ Mr. Strauss
I was not dealing with any Stamp Duty on an Order in Council. This matter deals with what for convenience I would call a general or omnibus revesting document which could be made by Order in Council.
§ Mr. Hale
With great respect, what is the point of a general re-vestment document? I suggest that such documents have to be essentially individual documents because in most cases we shall be dealing with nothing but actionable rights, with the right to recover from somebody else, with powers under a contract or with the benefits of an insurance risk that has occurred, and so on.
In some cases, of course, the Custodian of Enemy Property will be in possession of immense sums which have to be allocated. It may be that as far as that is concerned it could be done comprehensively. But I imagine there would have to be a whole series of documents affecting individual rights, and, in general, the liability for Stamp Duty would be on the recipient.
Therefore, I venture to suggest that I do not think the hon. and learned Gentleman's explanation is one that can be accepted. The actual wording of the Clause is a little obscure. It says:may make provision for transferring, by virtue of the Order and without any liability to stamp duty, to such persons as may be determined by or under the Order.It seems to be that the words "or under" are the controlling words in this respect. If the Order were able to ascertain by reference the individuals who were to benefit and were able to indicate the rights they had acquired in some measure of detail, there might have been something in the point.
As I apprehend, they will be indicated only as a class of persons of certain nationalities, having certain rights, and it will be for the Custodian of Enemy Property to allocate them. It seems one can only do it by detailed agreement and by specifying conditions. If the Parliamentary Secretary refers to the Clause, he will see it is transferring not merely rights but liabilities. One cannot transfer individual 548 liabilities to persons of a different country by Order in Council, and without the provision of some special and detailed agreement. In these circumstances, and by virtue of this agreement, there ought to be inserted contracts transferring rights and liabilities, and specifying the rights and liabilities which would normally attract Stamp Duty, and to which the exemption given should not be given.
§ Mr. H. Strauss
I should like to correct one slip I made in my last intervention. I think the hon. Member for Oldham, West (Mr. Hale) is right, and that it would be for the Order in Council itself to make this general revesting. On the point made by the hon. and learned Gentleman—on what, in view of the correction, I do not know, whether I should call a case of Privilege or a case bordering on Privilege—whichever it is, I am not saying whether it is serious or is not serious. I am advised that it is not a matter upon which a Minister should express an opinion. It is a matter for Mr. Speaker.
§ Mr. Strauss
The vesting Orders were general Orders, and they have never been stamped. But the question of whether they should have been or should not have been is not absolutely clear. I think all hon. Members are familiar with some of the difficulties in the Stamp Act. Just as the general vesting Orders have been made always without a stamp, so, I think, it is obviously convenient that the revesting Order should bear no stamp. The precedents of all Governments which I have quoted are very good ones. This is a case where it would be foolish to provide for a stamp and where, I suggest, the provision in the Clause is correct. That being so, hon. Members might withdraw the Amendment.
§ Amendment negatived.
§ Motion made, and Question proposed, "That the Clause stand part of the Bill."549
§ Mr. Paget
I have put down a new Clause, which is really a Clause in substitution of Clause 1 and cannot be called unless Clause 1 is rejected. I would suggest that in the case of future legislation, where one is creating schemes which affect individuals' rights, that what one is doing ought to be put into that Act of Parliament. What is the objection to this here, when we are asked to give legislative force to an agreement, every single clause of which affects individual rights and creates rights which did not exist before? When one is legislating in such a very personal manner regarding individuals, why not insert what one is doing into the Act rather than leave it to be dealt with by Order in Council?
I believe that the new Clause which I have drafted will do what is intended in a satisfactory manner, and not only that but it will do it in a manner in which each individual can find what his rights are by looking at the law instead of having to search in statutory rules and orders which are subject to various variations. Would it not be more businesslike to do it in the way we are suggesting in this new Clause?
§ Mr. Hale
I want to make just one point in a sentence, and I will not weary the Committee [HON. MEMBERS: "Oh."] If there are protests at my brevity I will be prepared to yield to them.
The practising solicitor is the man who has to advise the public on these matters. To do so he has got to have a rather hefty library. Indeed, it is often said that one of the hardest things is where to find one's law. It may be true that in London there are reasonable facilities and libraries available, but when the man in Manchester or Leicester or Birmingham is called upon to advise in this matter he is not even going to have the explanatory note.
In this Committee we at least are told the number of the Command Paper and where to find out the exceeding complex provisions which run into 24 Clauses. A man who is called upon to advise in this matter finds that this isan Act to provide for carrying into effect Agreements with certain foreign Governments with respect to contracts of insurance and reinsurance.…Then he finds that the only reference to the real subject matter is to an exchange of Notes between His Majesty's 550 Government and the Government of Finland on 28th of December, 1945. There is no indication as to where he can find that exchange of Notes, and I am bound to say I should have thought that there are hardly ten solicitors out of the 30,000 in England who know when and how to look for it. Certainly, it could not be found in any provincial town.
It is not the fault of the Parliamentary Secretary and I am not blaming him. He has enough to carry without being blamed for this system, which has gone on for some time, and about which I have protested hitherto. These things ought to be available, and in a country where the people are deemed to know the law it is a little monstrous that part of the legislation makes it absolutely impossible to obtain it. It is quite shocking that we should pass Acts of Parliament which do not contain sufficient information to enable anyone to find out where the details are. They are kept out of the Bill for one purpose, to prevent us from debating these complex matters in detail.
It is rather an amazing Measure, and this is rather a hotch-potch Clause. Not the least Gilbertian aspect of it is that we begin at the finish, and where we will end I hesitate to prophesy. I have made my point, and I do not want to labour it, nor do I wish to suggest that we should vote against the Clause standing part of the Bill.
§ Mr. H. Strauss
I should like to say a word in answer to the hon. and learned Member for Northampton (Mr. Paget) and the hon. Member for Oldham, West (Mr. Hale). I cannot accept the suggestion of the hon. and learned Gentleman the Member for Northampton which he has put forward in a new Clause, which I think is unlikely to be called, but I can assure him that his Clause will not do. When he sees the Order in Council and what it contains he will find that his Clause is both inadequate and in some respects wrong.
§ Mr. Strauss
If the hon. and learned Member will look at his new Clause, he will find that he has left out quite important bits of the agreement. As to the points raised by the hon. Member for Oldham, West, he knows, of course, where he can find the agreement, that is, in the White Paper. But I quite agree with him that in due course he must have somewhere where he can look for his law. That, of course, will be in the Order in Council.
It is better to have it in the Order in Council which Parliament can approve or Parliament can reject—I admit it cannot be amended—rather than to put an immense amount in the Bill which Parliament can amend, a thing which it would be perfectly useless for Parliament to do.
§ Clause ordered to stand part of the Bill.
§ Clause 2 ordered to stand part of the Bill.
§ Bill reported, without Amendment: read the Third time, and passed, without Amendment.