ROAD HAULAGE EMPLOYEES (COMPENSATION) (Hansard, 14 May 1953)

The Parliamentary Secretary to the Ministry of Transport (Mr. Gurney Braithwaite)
I beg to move, That the Draft Transferred Undertakings (Compensation to Employees) (Amendment) Regulations, 1953, a copy of which was laid before this House on 26th March, be approved. I am hopeful that we shall also have some harmony in the matter which I am now about to lay before the House. The point is a simple one.

§ Sir Lynn Ungoed-Thomas (Leicester, North-East)
The hon. Gentleman has not got lawyers dealing with this one.

Mr. Braithwaite
I hope we shall surmount the problem in the absence of the hon. and learned Gentleman.
Section 101 of the Transport Act, 1947, lays upon the Minister the duty of making Regulations which require the British Transport Commission to pay, in such cases and to such extent as may be specified in the Regulations, compensation to employees of undertakings transferred to the Commission who suffer loss of employment or loss or diminution of emoluments or pension rights or whose position is worsened, in consequence of nationalisation. It seems to be a little bit behind the time, but it does deal with that previous statute, and such Regulations have to be laid in draft and approved by affirmative Resolution of each House of Parliament.
It was under Section 101 that Regulations were made by our predecessors in 1950 which prescribed the terms and conditions for the payment of compensation to employees of nationalised road haulage undertakings. The object of the present draft Regulations is to amend those passed in 1950 in one single particular, and only in one, in order to rectify an anomaly which has since come to light.
Those Regulations laid down, among other things, that before a person could be eligible for compensation he must have been an employee of an acquired undertaking at the time of its acquisition by the Commission, and, in addition, he must have been engaged as an employee in A or B licence work since 1st January, 1940. This requirement was in accordance with the general principle followed in similar compensation Regulations which had gone before, that a man must have been employed in the industry for a certain time in order to be eligible for compensation.
I now come to the anomaly which we seek to put right tonight. In thus speaking only of employment, those Regulations of 1950 failed to take into account a circumstance which was peculiar to the road haulage industry. It is a circumstance which has not been found in any of the other cases for which compensation has had to be provided in recent years.
It has emerged that among employees of road haulage undertakings acquired by the Commission there were some who, although long-distance road haulage had 1543 been their occupation for the whole of the qualifying period, or indeed longer, had not been employees for the whole of that time because for part of it they had been in business on their own account as owners or as partners.
If I may give the House a typical case, it is that of the man who founded and built up a business and then at some time between 1st January, 1940, and its acquisition by the Commission in 1948 or later, turned it into a limited company of which he became a managing director. But the cases are not necessarily confined to that type. Various circumstances may have made it necessary for a man to give up his own road haulage business and, instead, to become an employee in the industry. Such a man may have suffered loss of employment or reduction of earnings when the concern with which he took employment was taken over by the Commission, but because of the wording of the existing Regulations he is debarred from obtaining any compensation.
The Commission have told us that they know of 65 cases in which claims for compensation have had to be refused solely on this technical point. Of course, there may be other persons who are in similar circumstances and who for this reason have made no claim. It will therefore, I am sure, be generally agreed that it is quite unfair that such persons should be disqualified solely on account of this circumstance, which I think was almost certainly not envisaged when the present Regulations were drafted.
These employees clearly satisfied the intention lying behind the qualifying period, that only those who were well established in the industry should be eligible for compensation, since in one capacity or another they had been engaged in it throughout the qualifying period.
To put the matter right, it is proposed by Regulation 2 of the draft Regulations which I am now asking the House to affirm, to amend the definition of "whole time service" to include a period of engagement in A or B licence work as the owner or part-owner of an undertaking. This will have the effect that a period of ownership on or after 1st January, 1940, will count towards the qualifying period of service.
1544 The amendment will have one other result also. Under the 1950 Regulations, the amount and extent of the compensation payment may, in certain circumstances, depends upon a person's length of service in the industry. For example, a person entitled to short-term compensation who is over the age of 45, can get an additional week's payment over the minimum of 13 weeks, for each year's service after 45. At present, he can only count whole-time service as an employee, but under the amendment he will be able to count the period spent on A or B licence work as owner, including any period before 1st January, 1940.
Regulation 3 provides that a claim for compensation, or for the review of an award of compensation already made, arising by reason of the amendment, must be made within 13 weeks of the coming into operation of the amending Regulations, if the House gives them approval. The Commission tell us that they will be able to inform persons who have already made a claim that they can make a fresh application under the amending Regulations.
In the debate on the 1950 Regulations, my right hon. Friend the President of the Board of Trade, and my hon. Friend the Member for Peterborough (Mr. H. Nicholls) drew attention to the defect which is now to be remedied by the amending Regulations. The point was considered immediately after the debate by the right hon. Member for East Ham, South (Mr. Barnes), who was then the Minister. The conclusion was reached that an amendment would be needed.
It must surely have occurred to hon. Members that a long period has elapsed since the defect was pointed out, but the chief reason why the amendment has not been made earlier is that at the same time consideration was given to another defect to which attention was drawn by my right hon. Friend the Member for Blackburn, West (Mr. Assheton). Whether action needed to be taken on the second point was uncertain, because it depended upon another point under the 1947 Act, which was about to be decided on appeal to the courts. It was therefore decided to defer action on both points until the test case had been decided. Unfortunately, this has taken a long time. It was only recently that the test case was 1545 finally settled by a decision of the House of Lords, and settled in such a way that no action was necessary on the second point raised by my right hon. Friend the Member for Blackburn. West.
Therefore, these Regulations will put right an injustice which arose, I am sure unwittingly, under the original Regulations. I think the House will agree that in complicated Regulations of this kind it is not surprising that a point of this sort is occasionally overlooked at first. It is only right that once the oversight is discovered it should be remedied. It is for these reasons that I commend the Regulations to the House.

§ Mr. Ernest Davies (Enfield, East)
I do not propose to delay the House for more than a very few minutes because, as the Parliamentary Secretary has pointed out with his usual clarity, the reason for these Regulations is to amend the Regulations originally proposed by the predecessor Government. He has explained the anomaly which was discovered, and why it has not been possible to go ahead with it before. Obviously we support these Regulations
I must say, however, that when I first looked at them I had a little suspicion. They are coming now from a transport stable which does not always run the best horses, and I was a little worried whether these Regulations were not opening the door a little wide to enable certain persons to obtain compensation for loss of employment who had been forced out of the industry on nationalisation, and although they had already been over-generously compensated they might now be in a position to receive compensation for loss of employment. If the Parliamentary Secretary will give me an assurance that that is not the case I shall be grateful.
There seems a possibility that under the new Regulations persons who have been part of the time, prior to the 1947 Act, themselves owners of road haulage undertakings, will be able to count that period for compensation for loss of employment. There might have been cases where these persons were interested in the businesses which were acquired and therefore would be receiving extra generous treatment.
The second point is that I notice that paragraph 3 (2) provides for a review of 1546 any further cases. I do not know whether the Parliamentary Secretary or the Commission have any idea how many such cases are likely to arise, in addition to the 65 to which the hon. Gentleman has referred. It would appear that only those who had made a claim before the coming into operation of these Regulations would be affected, and so I trust that there will not be a large number of new cases.
I should like to know whether the trade unions have been consulted with regard to these amending Regulations. The original Regulations were made in full consultation with the trade unions. I assume that there has been consultation in this case and that the trade unions have agreed to this amendment. I trust that the Parliamentary Secretary can give me that assurance. The hon. Gentleman said that we were going back in this case to nationalisation in 1947, which was now rather out of date.
I would point out to him that in the 1947 Act we provided for these Regulations right from the beginning and that they were produced in due course. But when the present Government produced a White Paper on transport policy the Minister failed to pay any attention to the interests of the workers affected and it was only after pressure from this side of the House that Clauses were introduced into the Transport Bill which finally provided for compensation for those likely to suffer under the new Act. Having said that, I must add that we certainly do not intend to oppose these Regulations.

Mr. Braithwaite
By leave of the House, I should like to reply to the points made by the hon. Member for Enfield. East (Mr. Ernest Davies), whilst resisting the temptation contained in the concluding words of his speech to enter again into the long debates which we had in connection with the new Transport Act.
On the hon. Member's first point, these Regulations were framed, having regard to the situation. I have to say that after consultation with the Commission it was felt that the best definition was to say that a man must have been employed at the time of the acquisition and therefore could not obtain compensation for acquisition as well as compensation as an employee. The hon. Member also asked if we knew how many cases there were 1547 likely to be in addition to the 65 which I mentioned. I am afraid that we do not know but we believe the number to be very small.
On the question of consultation with the trade unions, I must answer that the trade unions were not consulted on the draft of the Regulations, which, of course, did not touch either the basis or the extent of the compensation but dealt with the definition of eligibility. The trade unions have made no adverse comment. The Regulations have been before the trade unions, as they have been before the rest of us, since 26th March, and I can assure the hon. Member that the trade unions are satisfied.

§ Mr. Ernest Davies
Were the trade unions invited to comment on the Regulations? Were copies sent to them?

Mr. Braithwaite
The Regulations have been available to them since 26th March, as to everyone else, and a copy was sent to them by my Department. There have been no adverse comments and I think that the hon. Member can be assured that the trade unions are satisfied.