HC Deb 17 July 1953 vol 517 cc2434-54
Mr. G. Darling

I beg to move, in page 2, line 33, after "twenty-five," to insert "members and ten assessor members."

The Chairman

With this Amendment we can take the three Amendments in page 2, line 35, and the Amendment in page 3, line 19.

Mr. Darling

What we were trying to do in the previous group of Amendments was to give some practical effect to the very useful recommendations of the Estimates Committee, which have gone into the question of the workings of the Commission. Here we are putting forward what is, in effect, a permissive proposal to cover possible cases in which a group of the Commission, or the Commission as a whole, might feel themselves handicapped in their inquiries through the lack of some special technical knowledge or technical experience, and would like to have an expert or experts to help them with their inquiries.

This provision may never have to be used, or may be used only sparingly. On the other hand, it may prove to be extremely valuable in the working of the Commission and the groups. In paragraph 13 of the Report of the Estimates Committee they recommend: …that the Commission should consider whether there might not be advantages in the employment, in some instances for certain types of inquiry, of professional industrial advisers, subject to the safeguarding of confidential information. In other parts of the Report they suggest that special accountants might be brought in to undertake certain inquiries. It seems perfectly clear to all those who examine the workings of the Commission that the use of experts of one kind or another for special inquiries might be extremely useful to the Commission and to the groups working with them. That, for instance, may be one way of breaking the bottleneck which is referred to in the Report of the Estimates Committee I think the phrase, "breaking a bottleneck" is perfectly permissible; I should like to break quite a number of bottlenecks in this business. I am sorry that the Parliamentary Secretary is not here now.

1.30 p.m.

That Report referred to inquiries which involved inquiring into accountancy and costings. A group making such an inquiry might feel that an experienced accountant to help them would enable them to do the job better and more quickly. The proposal is designed to give the Commission greater help, expert technical help, financial help and the help of technicians in industry when the need arises.

We should make it clear that these assessors would be there to give advice and help. They would not be there to take responsibility for decisions or to make recommendations. It would be wrong if assessors were brought in in this way in an advisory capacity and in order to help with inquiries, to saddle them with responsibilities which properly belong to the full members of the Commission. It is quite probable that if the suggestion is accepted the assessors who may be invited to take part would do so more willingly if it were made perfectly clear that they would not be taking responsibility for decisions or recommendations to the Board of Trade but merely to help in the work of the inquiry.

In our first definition of who these assessors ought to be, I think we were a little too cautious in saying that they should not put questions at the meetings they attended but only give advice. That clearly is going too far; they ought to be allowed to put questions. Therefore, we much prefer the Amendment in the name of my hon. and learned Friend. That is more in line with what we want. I think the whole group of Amendments ought to be accepted because, together, they carry out at least one, if not several, of the recommendations of the Estimates Committee. That is that the Commission should be advised and helped by experts who can give good advice and help, and the general work of the Commission would gain in consequence.

I would again stress that this power would be purely permissive. It provides that the President of the Board of Trade can increase the number. What we are aiming at is that on certain types of inquiry in which the Commission or a group of people are inquiring into a matter and feet they want help, the President of the Board of Trade shall be in a position to give that help.

Mr. P. Thorneycroft

Although I fully appreciate that the purpose of this Amendment is to assist the Commission in its work, I hope the hon. Member will not press its acceptance. I do not feel that the appointment of assessors in addition to the ordinary members of the Commission is really necessary. If from time to time they want outside assistance from accountants, or any other persons, there is no reason why they should not seek it. They have power to do so and can call in such help to aid them. Quite apart from the assessors asking questions, the Commissioners might want to ask questions of the assessors. They can ask questions of any expert body and obtain the advice they need. Perhaps when the hon. Member reconsiders the Amendment he would see that the position of the assessors would be rather peculiar. In the original draft they would have been in a strange position. It would be that of "Hear no evil, see no evil, speak no evil." At least that would be the position in regard to the latter two. They would be unable to participate and it would not be a very satisfactory arrangement.

The Amendment in the name of the hon. and learned Member for Kettering suggests that they might be allowed to ask questions but the more one approximates them to the ordinary work of commissioners the more one wonders why they are not commissioners any way. If they are to perform the sale role they might as well be members of the Commission. The idea that at all times the Commission should feel free to call in any assistance has something to commend it, but perhaps the hon. Member will feel that this Amendment is not the best way in which that can be achieved and will not press it further.

Mr. Mitchison

Feeling for the moment in a highly non-combatant spirit, I hope the President will consider the matter a little further. Two questions are involved. One is the special question of accountancy, upon which some evidence was given before the sub-committee of the Select Committee on Estimates. It emerged from that that the present Monopolies Commission uses an accountant seconded from the Board of Trade and they have help from other Board of Trade accountants. An hon. Member who is himself an accountant said that he did not altogether like the frame of mind of Board of Trade accountants. I say nothing about that, except that I do not associate myself with it. Obviously there is a case for getting some independent accounting advice. I put it no higher than that. I am sure the President would agree. In giving evidence the Chairman of the Commission said that: all the accountancy side of the Commission is very much under the control of one member of the Commission, who is himself an accountant. If we are to have groups working in the way that is contemplated, we shall need more accountants. I do not say that is necessary for each group, but we shall need more.

Another matter mentioned before the sub-committee was that of looking at factories and getting what was described as the background. I quite agree that that may be properly and usefully done, but if in a proper case someone who can give a lot of background and information could be found, so much the better. I think the President will agree with those two points as points.

He asked why the man should be made an assessor. We do have assessors in Admiralty cases in the courts and they fulfil a very useful function. They are men with technical knowledge of seafaring and take part in the inquiries. They put questions to witnesses and give advice to the judge, but the decision, of course, remains the decision of the judge. The advantage of having an assessor for that kind of thing is particularly strong where the proceedings are public or reported because if an accountant is called as a witness the information has to be got from him by question and answer. The constitutional technical information can be got from him if he is sitting as an assessor and, for that purpose, forming part of the tribunal—the group, in this case. If this were a compulsory power I could understand the President's objecting, but it is a permissive power, and I believe he will find it useful to have it.

How far it would be used would obviously depend on two things, the nature of the particular inquiry and the view of the chairman of the Commission and, probably, of the chairman of the group concerned. I can quite see the chairman of a group—or the chairman of the Commission, no doubt—saying to the President, "I really should like someone to whom I can talk about this kind of thing, and ask questions, and so on," which would be part of the deliberations of the group within its own four walls. I see no objection to that technical information, technical knowledge or special knowledge.

For these reasons I regret that the President has refused to take this power. I cannot see that it would possibly do any harm. He will not want to appoint those people, of course, out of the existing members of the Commission; therefore, they ought to be additional. Further to that, he will not necessarily want to appoint them, I should think, in the majority of cases for a long period at all, but this Amendment would allow him to appoint an assessor member for a single inquiry or, if he wished, for a series of inquiries. I should have thought. without any particular contention on this matter between the two sides of the Committee, it would have been a useful power to have had, and that it would have caused no harm. At a later stage I think the right hon. Gentleman will probably regret having refused to take it.

Mr. W. Shepherd

I quite agree with the hon. and learned Gentleman the Member for Kettering (Mr. Mitchison) that there is room for divergence of view on this subject quite apart from any political considerations at all, but I am of the opinion—and I was a Member of the Select Commission that considered the Monopolies Commission—that any encouragement of outside bodies to work on the Commission in a general sense is to be deplored. It is perfectly true to say that there are existing powers today to use outside consultants. Not only do the powers exist, but they are in fact exercised, and on one inquiry a firm of outside accountants is employed by the Commission, I believe, at the present time. So there is no question of the ability of the Commission under the existing statute to employ outside aid if they wish.

I think there ate two reasons of considerable force against the employment of outside agencies, the first one being that it is very difficult indeed to get a body of people outside, if they are practising in some profession connected with industry, who have not some association with an industry that may be the subject of investigation by the Commission. I think the Committee would not wish to have people engaged on these inquiries who may be suspect from that angle, and, indeed, many of these professional people would object and probably refuse to serve if they felt that through some position they held in a particular industry or firm they were directly or indirectly connected with the inquiry.

Mr. Mitchison

Would not that apply to consultants, too?

Mr. Shepherd

I think it applies to any outside body of men who assist the Commission. That is why I think it is a very strong reason why we should not in general encourage outside persons to work with the Commission.

The second reason why I think we should reject the idea of encouraging them, although still having the permissive power to use them if necessary, is this. I disagree very profoundly with what the hon. and learned Gentleman said about getting consultants to visit factories to get information. If the Commission are to be any good at all they must be a body of experts with knowledge and judgment. It is no good having a Monopolies Commission who have to turn to outside people to get this information.

1.45 p.m.

I have no doubt that there may be occasions on which reference to outside people would be of assistance, but the members of the Commission ought to be encouraged themselves to visit these factories to learn as closely as they can about industrial conditions and the matters with which they are dealing, and any attempt to use outside people to get the information, in essence would prevent the Commission from acquiring the information themselves directly, and would be doing damage to the reputation and the capacity of the Commission.

Mr. Mitchison

I quite agree that the Commission ought to pay visits, but there are cases where technical knowledge, special knowledge, may be very useful even on a visit. If they were going to a steel works it would be useful to have with them someone who knew how steel is made.

Mr. Shepherd

I quite agree that there may be occasions upon which the use of consultants would be of advantage to the Commission. I have already said that the Commission are using outside accountants in a current inquiry, but I think it would be unwise to include these words in the Bill, because they would simply be giving some sort of encouragement to a practice which the Committee, on reflection, I think, will agree is not desirable.

Mr. Ross

I agree very much with a great deal of what has been said by the hon. Member for Cheadle (Mr. Shepherd), and I doubt very much whether we shall achieve all we should like to achieve, as set out by my hon. Friend the Member for Hillsborough (Mr. G. Darling), by this Amendment. I think there are two points, and I think that that about people with a knowledge of finance and accountancy is quite separate from that about consultants.

One of the things which we came up against on the Select Committee, when considering the use of outside accountants, was the fact that it would be difficult to get at all times a firm that was not connected with one or another of the industries. We are concerned about the speed of investigation, and the benefit of having not just one investigation but a series of investigations at a time; and that is less likely in view of the widespread nature of many of these firms we are investigating or hope to investigate, because of the possibility of a firm of accountants being connected with them in some way or another.

The other point is that about consultants. There is a consideration that has been overlooked. I do not think we paid enough attention to it on the Select Committee either. It is this. At present, the Commission, when they visit the premises of any of the firms being investigated, go there as a matter of courtesy. They have no power to go there, no power to enter. If our intention is to arm them with a body of official efficiency experts I think it is hardly likely that that courtesy will be extended to them. If we are to get the full benefit of this Amendment we need to give stronger powers of entry and inspection to the Commission.

Against that we have to weigh this consideration. We are now giving power to the Commission to split up into groups. If we do that the possibility is that a group will not have a very widespread knowledge. So the greater is the need for having some kind of outside help from professional bodies. I think the President would do well to look at this whole matter again to see whether or not, realising the difficulties, and the dangers of repercussions upon the side of industry, it would be possible for the Commission to co-opt assessors to guide the limited groups towards better understanding.

After all, the reason they go to these firms is to get an impression and a sort of background to the inquiry. It is very easy for anyone without experience of going round factories to get an entirely wrong impression. I remember what we used to do in the Army days. When we knew that someone was coming round we were very good at seeing that they got a wrong impression. So it is probably advisable that we should have some sort of background people ready to give to the chairman or deputy-chairman of one of these groups specialised knowledge which might help in the inquiry. On balance, I think that there is more to be said for the Amendment than against it, although it might have been better worded.

Mr. Bottomley

I would ask the President to reconsider the question of assessors. I think it is difficult for him to contest the views expressed by my hon. Friends and that he would be the first to say that experts are very good servants but not good masters.

The hon. Member for Cheadle (Mr. Shepherd) said that many of these assessors might have very wide associations with business, and I think he was trying to infer that we might not get complete loyalty. I should have thought that by this system of assessors we did create loyalty. They have personal contacts and knowledge of the minds of those who are members of the Commission, and I should have thought that was an additional reason why assessors should be accepted. I hope that the President will reconsider his view, and see whether he can answer some of the very formidable points put to him by my hon. Friends.

Amendment negatived

Mr. Shepherd

I beg to move, in page 2, line 44, to leave out "five," and to insert "seven."

I have put down this Amendment for a number of reasons which I should like briefly to put before the Committee. I want, first of all, to refresh the Committee's memory upon what is happening in the Commission at the present time. There exists a group or panel system, but the activity of the group or panel system is limited at present to obtaining the facts about any particular industry or inquiry, and perhaps making some tentative recommendations. The whole of the Commission then considers the facts and whatever recommendations have been made, with a view to determining the public interest in that particular case. That, I think, is not an unsatisfactory position and I would have much preferred to have seen an extension of that principle than what we are now putting in the Bill.

I am by no means happy about the attempt to divide up the Commission into little groups and to do away with the methods of inquiry which are carried out under the existing procedure. I fully realise the difficulty in which the President of the Board of Trade has been put in this matter. I know that the Commission is a bottleneck in itself, but the more one multiplies the number of inquiries the more grievous becomes the position of the Commission. I do not suggest to the Committee that I have any brilliant solution of this seemingly insoluble difficulty, but I feel that the present arrangement which aims at carrying a minimum of five Members is not a desirable one.

This issue, I think, ought to be judged purely from a standpoint other than that of speed. I suspect, from some of the speeches of hon. Members opposite, that to them speed is the only thing that matters. If they can get the Monopolies Commission churning out reports like sausages out of a machine they will be perfectly happy.

Mr. Daines

Is the hon. Gentleman happy with the output after the number of years we have been operating?

Mr. Shepherd

I would like to see more schemes, but there are other factors that are important, and, I am humbly suggesting, more important than the mere factor of speed. Although we have reports, they often take a long time to produce. Nevertheless, there are many satisfactory features about the work of the Monopolies Commission. I would prefer to have the present speed with the present skill and a wide measure of acceptance than reports produced in quicker time.

I object to having five as a minimum number, because I feel that five is too small a number. Hon. Gentlemen opposite have already indicated that they are against this because they think that to increase the number from five to seven will interfere with the all-important factor of speed. I ask them to consider other factors rather than that of speed. If one has five members of a group within the Commission which is charged with the responsibility, not merely of investigating the facts, but also of determining the public interest, and there is a difference of opinion among them and no guidance, except perhaps that of the chairman, I wonder what the position will be. That is an interesting point. Will the Chairman be able to overrule the group within the Commission if he disagreed with their view upon the question of public interest? What is to be the position within the Commission if that situation does arise?

Clearly, this is a most onerous task for these five men, and I do not think that five is adequate to meet the situation. We could easily get within a group of five within the Commission considerable divergence of opinion. What is to happen if we get five members, three of whom think one way and two another? It will be a very difficult situation.

Mr. G. Darling

Or four to three?

Mr. Shepherd

That may be, but the chances are obviously reduced. I do not agree that seven is a desirable number, and I am only suggesting that seven is more desirable than five. If we have such a small number we are likely to get differences of opinion that cannot be reconciled. There is, therefore, the very real danger that these small groups will have no co-ordinating factor other than the chairman, and they may themselves have a different attitude towards the monopoly.

As the right hon. Member for Huyton (Mr. H. Wilson) said, in anticipating one of the points that I wish to make, it may well be that these groups will have different views on what is more or less a similar situation. That is a real difficulty. I think that if we increase the number from five to seven we do not eliminate that possibility, but I think that, on the whole, we tend to make it less likely. I think that we may easily get, unless we are very careful, too many people of a like kind in one of these groups. Imagine having a group consisting of five members, three of whom were long-haired economists. They would all probably have independent solutions as to what should be done.

2.0 p.m.

There is a strong case for increasing the number in the groups from five to seven. I am fortified in this view by the speech of the hon. Member for Kilmarnock (Mr. Ross). He said the groups were very small and that it would be a good idea to have assessors to guide them in their work. That is an indication of how hon. Members are thinking about the groups, that five is a very small number and that the groups will not have sufficiently wide experience to commend their work to the House or to industry.

I make the point about the reaction of industry as my final point in urging the acceptance of the Amendment. It is vitally important—there is nothing more important in connection with this legislation—that the reports of the Commission shall be regarded as full, fair and reasonable by industry itself. Up to now that has happened to a surprising degree. When we passed the original Measure we did not believe that the work of the Commission would receive the widespread acceptance by industry that it has.

What will happen under the small group system? An industry which has been investigated may say, "We were investigated by group B, on which are Mr. So-and-so and Miss So-and-so, and we know they have a strong prejudice in the matter. Had we been investigated by group C we should not have had such a bad report." There is a grave danger of weakening acceptance of the Commission's authority by industry.

While we must accept the group system—it is a very bad system—as being inevitable if we are to get more speed at the present time, we should strengthen the groups by accepting the Amendment and thus increasing the minimum number from five to seven.

Mr. Daines

I was looking at the Government Front Bench anxiously all the time the hon. Member for Cheadle (Mr. Shepherd) was speaking, hoping that there would be a sign that the Parliamentary Secretary would honour us with his observations. I should hate to think that he had sunk to the position of the Parliamentary Secretary to the Ministry of Education or the Minister of Materials, and become dumb on these matters.

What is the merit in the hon. Gentleman's argument? Is he seriously arguing that there is some magic in the number that he suggests which would produce a more balanced opinion? I thought that the logic of his argument was that the only way to avoid all the difficulties that he mentioned would be to have a one-man commission. We have recently had an example of a one-man commission. It produced precisely what the hon. Member fears. It produced speed, but it also produced a nasty after-taste of dissatisfaction among many of us.

There was not much merit in his argument. It seemed to be coloured by the general outlook that there are not the restrictive practices which actually exist and that any rearguard action which can be taken should be in order to restrict the Commission and prevent it from operating too quickly. We want much more speed than there is now. When the hon. Member said that the operation of this legislation gives widespread satisfaction in industry, that is at least one argument on which I am in accord with him. There is widespread satisfaction in industry because of the inactivity of the Commission and our inability to find a method whereby we can get not only efficiency but also speed. If the hon. Member is really sincere about this, he must agree that speed enters into the issue.

Mr. P. Thorneycroft

The Amendment is a fairly narrow one, namely, whether there should be a minimum of five or a minimum of seven members sitting on a group. We are indebted to my hon. Friend the Member for Cheadle (Mr. Shepherd) for having drawn our attention to the important aspect of how we can make sure that the group system will work to the very best advantage. I do not want now to enter into the wider argument that he raised, but the House of Commons has agreed that the only way that we can get a reasonable flow of work through the Commission is to enable it to work in special groups. The suggestion that part of the work should be done by part of the Commission and then the whole Commission should meet to make the final decision does not meet the basic requirement, which is to ensure a greater flow of work going through the Commission, which my hon. Friend accepted.

With regard to the figure of five, one can criticise any minimum figure that is suggested. Even under the existing law, technically one could have a Commission of four settling reports with only three members present. That is an extreme case and one is not likely to encounter it. But we ought not to confuse a minimum with what may turn out to be the normal practice of the Commission. It is entirely a matter for the chairman how many members he appoints. I can visualise some inquiries in respect of which seven would probably be more advantageous than five. Equally, experience might show that there were other inquiries where five would be entirely adequate to the purpose, provided that we had the right five. A matter of that sort is better left to the chairman of the Commission.

I should like to remind my hon. Friend of another feature of the Bill which is just relevant to this matter, namely, that in the case of a public interest report we have to have a majority of two-thirds of the group before action can be taken under Section 10 of the principal Act. That means that a group of five dealing with a public interest report would need to have four of its members, at any rate, agreeing. That goes some way, although perhaps not the whole way, to meet the point which my hon. Friend has in mind. I hope that, with this explanation, and the knowledge that this is a minimum provision, my hon. Friend will see his way not to press the Amendment.

Amendment negatived.

Mr. Shepherd

I beg to move, in pace 3, line 1, to leave out subsection (3).

The intention is to prevent the chairman of the Commission from determining that a reference under Section 15 of the principal Act shall be taken by one of the groups. I fully appreciate what my right hon. Friend said about the group system generally and the safeguards which exist, but I feel that it is unwise in the extreme to allow an issue as important as a determination under Section 15 to be taken by a group of the Commission. In such an important matter it is highly desirable that the report of the Commission shall be the report of the whole Commission and not that of a group.

My right hon. Friend may say that this is a matter which ought to be left to the judgment of the chairman, and that is not an unreasonable answer to come from the Treasury Bench, but I am not satisfied that that is so. The chairman may well feel that within his Commission he has a group capable of carrying out the function. But what we have to bear in mind is that the public as a whole and industry as a whole have to accept the recommendations of the Commission and have to regard them as having been reached after due deliberation and careful consideration.

What will happen under Section 15? The Commission will bring in a judgment upon which it is expected that the Government of the day will introduce legislation. It is expected that the Government will be likely to outlaw practices on a wide scale. It is wrong that an issue as important as this should be determined by a small group of the Commission. It is something which the whole Commission ought to consider and for which it should accept responsibility.

I realise that in putting down this Amendment I have not been at all complete. I am fortified in that by the efforts of hon. Gentlemen opposite who had to admit that all their Amendments were badly drafted.

Mr. Daines

No. They were well drafted. One was accepted.

Mr. Shepherd

The Opposition have said they did not think their Amendments were much good, but that they knew what they meant. I was in the same difficulty in attempting to draft Amendments. I have contented myself with proposing the elimination of subsection (3), though I realise that something more would have to be done if the intentions I have outlined were to be fulfilled. This is an important point. It is wrong to allow these references under Section 15 to be considered by a sub-committee.

Mr. P. Thorneycroft

The effect of the Amendment would be to ensure that any general reference under Section 15 would have to be referred to the whole Commission—all 25 of them if the full number had been appointed—and could not be dealt with by a group. I say at once that as soon as we accept the principle that the report of a group is a report of the Commission—and that is the basic principle we have accepted in the Bill—we should be making a great mistake if we tried to say that there were grades of report. It would be a mistake if we said that the top grade was that which had a special reference under Section 15, and that was category one; and that it was quite a different grade for some other business—to which after all a large number of people attach a great deal of importance because it is their livelihood—which was a category two report.

I do not think that I could accept any differentiation of that kind. Having said that, I agree that the precise way in which we deal with these various matters which are referred will differ between one and another. No doubt a wise and sensible chairman—and I hope that we shall continue, as in the past, to have a wise and sensible chairman—will think that in some cases a rather larger group will be necessary. Some hon. Members have said that that was the sort of case where he might decide to preside himself, and that would be perfectly proper, but I should be sorry to see arrangements made which compelled the whole body of the Commission, which might be rather a large body, to decide some of these matters. I should be sorry to see that the whole body of the Commission had to sit on a particular type of reference and that that reference would have to be put in a separate category from any other.

Amendment negatived.

Motion made, and Question proposed, "That the Clause stand part of the Bill."

2.15 p.m.

Mr. Simon

I wish to ask a question about subsection (2), which contains power for a group to make a report under Section 12 of the principal Act. That subsection really gives power to the Board of Trade to refer to the Commission the follow up of their recommendations. It would seem that this is a machinery which has great advantages. The Commission is already well informed as to all the details of the matters they have in mind. Also, it would seem, on the face of it, to avoid a duplication of machinery in the Board of Trade and in the Commission.

So far as I have been able to see from the annual reports of the Board of Trade, under this Act that machinery has not been used. I should like to ask my right hon. Friend to say how far he proposes to use it. There is a specific example. We have, in the 1952 Report, a rather disturbing statement in respect of the dental goods trade that, in spite of the 1951 Report, it still appears that the trading policy of certain leading manufacturers has not to any significant extent been modified in the direction of willingness to supply new customers on trade terms. This attitude has continued to give rise to complaint.

It is only fair to say that that Report specifically says that there has been no contravention of the Dental Goods Order, but it is clearly a matter which gives rise to a certain disturbance that that situation has been found still unsatisfactory in a second annual report dealing with the matter. I should like to ask my right hon. Friend whether he proposes to use the machinery of Section 12 of the principal Act.

Mr. H. Wilson

I should like to support the hon. and learned Member for Middlesbrough, West (Mr. Simon). Hon. Members may have noted on the Order Paper a proposed new Clause in the name of my right hon. Friends and myself with the title: Chairman's power in relation to s. 12 of principal Act, which, unfortunately, I am informed, will not be called because it is outside the scope of the Bill. We had in mind something similar to what the hon. and learned Gentleman was thinking about, but I will not discuss the new Clause as it is out of order.

I fear that the Monopolies Commission will be less effective in practice if it is not given a virtually automatic duty of following up its own reports. We hope that the President of the Board of Trade will see that there are frequent references of this follow-up character. Had it been possible we should have liked to propose an Amendment to the principal Act, to alter Section 12, and to make these references mandatory instead of permissive.

I would inform the hon. and learned Member for Middlesbrough, West that we should also have supported the idea in the new Clause, Deposit with Commission of copies of restrictive agreements or arrangements which is in his name and that of several of his hon. Friends, but I understand that that also is out of order. That takes up a suggestion in the recently published document, "Challenge to Britain." I am glad to see the speed with which this document is beginning to convert some of the more reasonable hon. Gentlemen opposite.

Mr. Simon

I have not been converted.

Mr. Wilson

As it was not possible to propose direct Amendments to Section 12 of the principal Act, we had to be content with trying to do it by giving special powers to the chairman; but that also was out of order.

I hope that the President of the Board of Trade will bear in mind what has been said from both sides of the Committee. Although, without introducing new legislation, he cannot make it mandatory upon himself to make a succession of references for these follow up investigations, we hope that he will judge the feeling of the Committee to be that in every case where there is any doubt about the recommendations being carried out—quite apart from those where legislative action is called for—he will not hesitate to refer these matters virtually automatically to the Commission to make sure that they report upon the follow-up action in question.

Furthermore, we tried to suggest, in the proposed new Clause which is out of order, that there should be a succession of reports for two years following on the publication of the report by the Monopolies Commission. I hope the President will bear that in mind in his operation of Section 12 of the original Act. The hon. and learned Member for Middlesbrough, West referred to the danger that a report might be made and that then there might be some backsliding—the Parliamentary Secretary would probably prefer the word "recidivism"—on the part of the industry concerned. Therefore, I hope that the right hon. Gentleman will tell us that he will refer all these cases to the Monopolies Commission for report on their actions, and will not be satisfied with one report but will repeat the operation at two-yearly intervals.

The Parliamentary Secretary to the Board of Trade (Mr. Henry Strauss)

I shall not deal even indirectly with the subject matter of the proposed new Clause which will not be selected, but I would reply to the point made by my hon. and learned Friend the Member for Middlesbrough, West (Mr. Simon) and some points made by the right hon. Gentleman. I think the Committee will bear in mind the distinction drawn by the principal Act—which is in no way altered or blurred by this Bill—between the functions of the Commission, which are inquiry and report, and the enforcement action which is for the Government Department concerned. It is common ground in the Committee that we desire to preserve that distinction.

The follow-up action is for the Government Department concerned and not necessarily for the Board of Trade. Section 12 of the principal Act is a wise provision. Its purpose is to enable the Board of Trade, where the Government Department concerned is not satisfied about the effectiveness of the follow-up action and thinks that an investigation by the Monopolies Commission would be useful, to refer that matter to them. That will be done when it is considered useful, but the last thing desired in any quarter of the Committee is that enforcement should be delayed by any further reference to the Commission if that did not happen to be useful or necessary.

My hon. and learned Friend mentioned the sequel to the report on dental goods, but that was followed not by an agreement between the Government Department concerned and the industry but by an actual order having the force of law. If he will refer to Section 12 of the principal Act, he will find that by the proviso to subsection (1) the question of the enforcement of an Order would not be referred to the Commission, because that is a matter for the courts and legal authorities. Where, however, there has not been an Order and an investigation under Section 12 would be useful to find out to what extent the follow-up action has been successful, my right hon. Friend will not hesitate to make use of that Section.

The right hon. Gentleman the Member for Middlesbrough, East (Mr. Marquand)—Middlesbrough seems so expert on monopolies that it is difficult to remember with which of the divisions one is dealing—knows that the difficulty experienced in the case of dental goods arises from one of the inherent difficulties of the subject. In that case, however, an Order has been made and by a wise provision in the principal Act, that is not a matter which could be referred under Section 12.

Mr. Hilary Marquand (Middlesbrough, East)

The hon. and learned Gentleman is quite right in reminding us of the distinction between the job of the Board of Trade and the Commission in investigating certain circumstances and. on the other hand, the job of the competent authority if it desires to make and enforce an Order. That is logical and true, and for the good reasons he gave I would not want to dispute that set of circumstances. On the other hand, as a matter of common sense, in starting a new legal apparatus of this kind we ought to be careful to watch what is happening and not necessarily be content, if our objectives do not appear to have been achieved, to say, "Well, we cannot help it, that is what the Act says and nothing more can be done."

What happened in the case of the dental goods industry was that I found, with the aid of the best possible legal advice both in the Ministry of Health and in the Board of Trade, that it was extremely difficult to draw up an Order which met the circumstances of this case. I do not think I would be betraying any State secrets if I said that there were many shots at it before the final Order was made.

Mr. Shepherd

Two Orders

Mr. Marquand

That is quite right, two Orders. Although the Order dealt with collective boycott and restrictive practices, it since appears that it has been possible for each of the separate firms individually to withhold supplies. I say "it appears" because I cannot prove it but, on the evidence given to me—which, of course, I passed on to my successor—it appeared as if it had been possible for each of the separate firms which were forbidden to boycott collectively to be able to operate an individual refusal of supplies to certain traders. That is outside the scope of the Bill, however, and I thank you, Mr. Hopkin Morris, for allowing me to refer to it.

In the Bill we ought to give the chairman of the Commission an opportunity to survey the working of the whole apparatus, and not be too ready to say that this is a matter for the competent authority. The Commission ought to have an oversight of the general working under all schemes.

Mr. H. Strauss

Where there has been an Order then that is not a matter which can be referred to the Commission under Section 12. Let me deal with a sequel to an inquiry in which there has been not an Order but an agreement drawn up by the competent authority with the industry. Then, I agree, we might want a reference under Section 12, but, equally, the exact working might be known to the competent authority, that is, the Government Department concerned with the industry in question. For instance, if the Ministry of Health had an agreement instead of an Order, I am sure that the right hon. Gentleman would not wish the Monopolies Commission to investigate what might already be perfectly well-known to the Ministry of Health. What action should follow knowledge of the facts may be difficult and is for the Department or this House, but the investigation under Section 12 is surely only appropriate in cases where the facts are not known and in which it is useful to refer their ascertainment to the Commission. Where it is useful, my right hon. Friend would not hesitate to refer the question to them.

2.30 p.m.

Mr. Marquand

That is true, but, in this case of dental goods, there was something approaching agreement as well as an Order. An Order was made on two malpractices, and then the trade association in the industry concerned also agreed to revise its own rules. No Order was made about that, and we have there an example of both kinds of disciplinary action taking place simultaneously. There was both the agreement about the revised rules and an Order, failure to enforce which needs to be followed up. It is important, therefore, to keep both the Commission and the competent authority very close together.

Mr. Shepherd

As I have been dubbed a monopolist, for some reason which I do not understand, may I say that I feel a great sense of dissatisfaction with the arrangements that exist about a follow-up as far as a report is concerned. I went into this matter very thoroughly on the Estimates Committee, and, if my right hon. Friend cannot give all that my hon. and learned Friend the Member for Middlesbrough, West (Mr. Simon) wants, what he could do is to try to establish some machinery inside the Department. The right hon. Gentleman opposite says that they look after that now, but, in fact, they do not. Once an agreement has been made among manufacturers, the Department have no interest at all except to accept complaints as they come along. Some machinery ought to be set up in the Department so that, when agreement has been made, each year, or some less period, if necessary, a report should be made by the Department on the operation of that agreement. I hope that my right hon. Friend will consider that.

Mr. Mitchison

Is it within the recollection of the hon. Member that the Select Committee, of which he was a member, made a very similar recommendation in paragraph 40. at the end of their Report?

Question put, and agreed to

Clause ordered to stand part of the Bill.

Clauses 3 and 4 ordered to stand part of the Bill.