Clauses 4 and 5

HC Deb 12 July 1954 vol 530 cc135-65

The Secretary of State for Scotland (Mr. James Stuart)

I beg to move, in page 3, line 14, to leave out Clauses 4 and 5.

Considerable discussion took place on this Clause during the Committee stage on 12th May, when a number of hon. Members expressed doubt about the wisdom of setting up these two executives. It was feared that in practice we should have three bodies dealing with electricity generation and supply in Southern Scotland, and hon. Members asked also about the extent to which it was proposed to delegate the functions of the Board to these executives.

At that time, my hon. Friend the Joint Under-Secretary and I endeavoured to reply to these points, and we said that we did not wish to impair the overall responsibility of the board. We pointed out that the Bill expressly provides that the board shall not delegate to the executives functions relating to general financial control or the control of charges. What we thought at that time was that there was something to be said for having two subordinate bodies, one in the east and one in the west, who could, under the general direction of the board, keep the needs of these areas under close review and exercise oversight over local administration.

Since then, and in view of what was said during the Committee stage and also during the Second Reading of the Bill on 3rd February—especially by my hon. Friend the Member for Dumfries (Mr. N. Macpherson)—I have had further discussions with persons widely experienced in electricity organisation, and, as a result, while I attach no less importance than before to having an administration which would take full account of local needs, the Government are prepared to leave it to the board to advise on the structure which will ensure this. In order to achieve this, I am moving to leave out these two Clauses.

The result of this, if this Amendment is accepted by the House, as I hope it will be, will be to leave the board free—like the North of Scotland Board and English area boards to which the hon. Member for Cleveland (Mr. Palmer) drew attention during the Committee stage on 12th May, as reported in the OFFICIAL REPORT, column 1354, and further stressed in an interruption reported in column 1358—to consider the best arrangements for keeping in touch with the needs of all parts of their area and to review and modify their organisation from time to time in the light of experience, without the need for formal approval by the Secretary of State. I think that this is the -best course, and I hope that it will be agreeable to hon. Members on both sides.

I admit that I have to some extent changed my attitude as regards this proposition. That only proves that we have listened to the arguments that were advanced in Committee and have paid attention to them. We have gone into this matter with considerable trouble, and I hope that the House will accept the Amendment and realise that the Government are doing their best to meet the arguments put forward by hon. Members.

Mr. Woodburn

The Secretary of State might have saved himself a speech by simply saying that he regretted that when this discussion took place in Committee he had not accepted the commonsense put forward by the Committee in regard to the deletion of Clauses 4 and 5. When we put down our original Amendments to leave out the two Clauses, which the right hon. Gentleman resisted so stubbornly, no one on this side had the slightest idea that there would be such obstinate resistance to common sense. Two hours were taken up and much bad blood was occasioned quite unnecessarily in that debate.

When an Amendment of that kind is put down, the Secretary of State and his advisers have a complete opportunity to consider it before coming to the Committee, Whether the fault is with the draftsmen, the officials or the right hon. Gentleman himself, there seems to be a complete reluctance to make any improvement in a Bill, no matter how well the common sense is argued.

There were quite a number of my colleagues who argued, not for the sake of sabotaging the Bill, but who pressed on the right hon. Gentleman, since nobody knew what the executives were supposed to do, that the best thing was to leave the board to manage its own business in its own way and to set up executives where it thought it necessary to do so. Tonight, therefore, we can hardly object to the Secretary of State accepting the proposals contained in our original Amendments.

We were not sure whether our Amendments would be called and, therefore, we had to table an Amendment that we thought had some chance of being called. The Secretary of State having put down our Amendments for us, they are automatically called and, therefore, we are in a position to discuss them. If anybody wants to know the arguments for the Amendment, I refer him to the speeches made by my hon. Friends and myself in Committee, where can be seen the perfect arguments for the Motion that the Secretary of State has now moved. Therefore, we enthusiastically support the moving of our own Amendments.

Mr. Arthur Palmer (Cleveland)

My right hon. Friend has spoken of the two hours that were taken up in discussing Clauses 4 and 5 in Committee. Altogether, 22 columns of the OFFICIAL REPORT were taken up by the discussion of these extraordinary Clauses.

We told the Secretary of State that to put into the Bill a hard and fast scheme of administration was the worst thing he could do. The suggestion that regional executives should be established by statute was obviously cumbersome. What is more, it was insulting to the men and women who, presumably, would be appointed to the board if the Bill eventually reaches the Statute Book.

We begged the right hon. Gentleman and his Joint Under-Secretary for an explanation, but they remained stubborn and resistant to all the eloquence of my hon. Friends. The right hon. Gentleman has now recognised in the most practical and forthcoming fashion that we were right, and he cannot do better than we suggested by removing Clauses 4 and 5.

There are two ways of looking at the Amendment. It is either another demonstration of the clumsy way in which the Measures of the present Administration are all too often put before the House, or, alternatively, it is that the right hon. Gentleman agrees that this is the triumph of the processes of Parliamentary democracy which shows that reason from this side of the House sometimes gets a receptive ear on the other side. I think at this late stage we should take the more kindly view and congratulate the right hon. Gentleman on the good sense he has shown in following the advice we have given.

8.45 p.m.

Mr. William Ross (Kilmarnock)

We spent both time and temper over this in Committee, and it is rather strange that at this time of the day the Secretary of State for Scotland should tell us that what he is going to do is to leave the boards free as in England, when we remember what is going to happen in England. It was only on Friday last that it was announced that an inquiry would be set up to go into the whole question of the structure of the supply and administration of electricity in England. It may well be that that will result in the Secretary of State for Scotland being put in a strange position about electricity in Scotland.

The fact that the Secretary of State has changed his mind and was compelled to do so by the logic of the argument put by those of us on this side adequately demonstrates the fact that this whole thing springs more from dogma than from logic, and the Secretary of State would do more justice to the needs of the Scottish electricity supply if he did with the whole Bill what he has done in respect of these two Clauses, namely, change his mind and withdraw it.

Amendment agreed to.

8.48 p.m.

Mr. Henderson Stewart

I beg to move, "That the Bill be now read the Third time."

The main principles of the Bill are now well understood in the House and in the country. It will transfer to the Secretary of State for Scotland the functions now performed by the Minister of Fuel and Power in relation to electricity in Scotland.

Mr. Ross

He has nothing else to do.

Mr. Stewart

It will establish a small all-purpose Board in the South of Scotland, which will be responsible for both the generation and distribution of electricity in that part of the country. The North of Scotland Board will remain virtually untouched by the reorganisation, though in many respects its contacts will be with the other Scottish Board and not with B.E.A. It is clear that this Bill is not going to affect in the slightest way the broad workings of the grid. There will still be the interflow of power north and south just as there is now and as there has been. Indeed it may well be that there will be more inter-play in the days to come.

Mr. C. R. Hobson (Keighley)

Does the hon. Gentleman say that the association between north and south will continue? This is a very important statement to those who oppose the Bill. And can he say in what part of the Bill those assurances are actually to be found, because I well remember the Secretary of State for Scotland resisting very intensely the suggestion put forward from this side of the House that there should be included in the Schedule those Sections of the 1926 Act which make it possible?

Mr. Stewart

The hon. Member can feel perfectly satisfied that there are provisions in the Bill making it the duty of the one board to work in the closest cooperation with the other, which, of course, is the common-sense way of doing things. Nothing else would make any sense at all.

We have had an amicable discussion except for that brief period when we were a little at cross-purposes. We are now more or less agreed on the details of the Bill, and such suggestions as have been made tonight and in the past—tor example, as regards rural electrification—have been directed for the most part to amplifying provisions already in the Bill, and to which, therefore, we shall give the closest attention. There is no difference in principle there.

Mr. Pryde

I hope that the Joint Under-Secretary of State for Scotland is choosing his words carefully because, let me warn him, they are likely to be taken down and used in evidence against him.

Mr. Stewart

I am not afraid of that, I am using my words with the greatest care, and I stand by those words. I am glad that we have been able to meet the House on the two main issues which for a time seemed to divide us. For example, as regards negotiating machinery, by the amended provisions of the Bill the Central Electricity Authority—as it will now be called—the North of Scotland Board and the South of Scotland Board will have a duty jointly to seek consultation with any organisation—that is to say, trade union—appearing to them to be appropriate, with a view to making joint agreements with that organisation. I am glad that we were able so amicably to come to a common view of that point.

I am also glad that we were able to achieve accord on the administrative arrangements of the board. The right hon. Gentleman said that we might have come to wisdom earlier in the proceedings. It is always open to the Opposition to say that, but we listened to the debate, we took account of the doubts in the minds of hon. Members on both sides of the House, and my right hon. Friend took the view that it was proper to meet what appeared to be the general view of hon. Members, and therefore he withdrew Clauses 4 and 5.

In appointing the Members of the new board, my right hon. Friend has already given an assurance that he will bear in mind and act upon the same principles as he has done in the case of the North of Scotland Board. That being so, in the case of this board I am sure that they will set up the right administrative structure for their area.

These changes have not affected the main purpose of the Bill which, as has been explained from the beginning, is to complete the devolution to Scottish authorities of control of the generation and supply of electricity in Scotland. It is a further step in the Government's policy of "Scottish control of Scottish affairs," and therefore I am glad to be able to move the Third Reading of this Bill with that purpose. It is an example of the kind of decentralisation that is possible within a nationalised industry, and by bringing both the generation and distribution of electricity into the same hands, closer attention can be paid to the needs of the South of Scotland area as a whole.

In all these matters this Bill can quote the successful precedent of the North of Scotland scheme in which we were all concerned. We have sought to do no more than bring under the control of the Secretary of State the South of Scotland in the same way as the North of Scotland has been for several years. That being so, I have never been able to understand why any Scotsman should resist this Measure, On the contrary, I am glad that, as a result of our useful debates, it is most likely that this Measure, going so far to meet the broad sentiments of our people, will have the accord of this House.

8.55 p.m.

Mr. Woodburn

We have listened to a very interesting speech as a kind of forced justification of this Measure, but I am sure that everybody will agree that, after hearing it, nobody knows the reason for introducing the Bill. This is a piece of window-dressing and a gesture to Scottish nationalism, but even the people who believe in Scottish nationalism are not so unintelligent that they do not want to know the reason why something is done. To put a new label on a thing and say, "Under new management of the Secretary of State," will not convince anybody in Scotland that any great change has taken place. Nothing was done in this field without the approval of the Secretary of State during my term of office, and the French have the saying that the more a thing changes the more it remains the same.

The Joint Under-Secretary of State has not give us one instance of the practical result that will flow from the Bill. I propose to give the hon. Gentleman one which he does not seem to have noticed. It is that under the Bill the South of Scotland Electricity Board will assume the powers now possessed by the Hydro-Electric Board. In the exercise of those powers it will have to take into account a great many activities in connection with the development of the area in which the board works. Many social functions which were exercised by the Hydro-Electric Board are now attributable to the South of Scotland Electricity Board.

When, as I think he did, the Secretary of State agreed that these powers should be given to the South of Scotland Electricity Board he must have had some purpose in mind, but up to now we have had nothing from the Secretary of State to show the great imaginative purpose of the Bill and the great revolution in the supply of electricity in Scotland which is to result from his dynamic presence as head of the board. The Secretary of State seems so modest that we have not been told anything about it. After all, Scotland wants to be inspired by the Bill and have some of the inspiration that moved the right hon. Gentleman to be so passionate in favour of this new administration.

One of the criticisms that I have heard is that the Secretary of State took no technical or other expert advice as to whether the organisation was working well or not in Scotland. I gather from what has been announced that the Minister of Fuel and Power in England has now appointed a Commission whose terms of reference are: To inquire into the organisation and efficiency of the electricity supply industry in England and Wales in the light of its working under the Electricity Act, 1947, and to make recommendations."—[OFFICIAL REPORT, 9th July, 1954; Vol. 529, c. 2516.] I suggested on Second Reading that if the Secretary of State was going to make changes it would have been sensible to have some body to inquire into the question of whether the existing organisation was working well and what changes were desirable. When we on this side of the House were in office we took into account in all our activities the reports of expert committees.

It is obvious that this Bill was introduced simply because of some foolish pledges that were made, without consideration at all, at the General Election, that the party opposite would reorganise and give devolution in the electricity and gas industries and other things. At that time hon. and right hon. Members opposite did not know that Scotland had home rule in the gas industry. They knew so little about these matters that they made many foolish statements. The Bill is one of the results of those statements. This country will be willing to consider practical changes based on commonsense, but no one will suggest that the destruction of road transport and the mere sticking of a new label on Scottish electricity will make any great change in the progress of Scotland.

As I said on Committee stage, I am satisfied that under this Bill at first Scotland may be able to have cheaper electricity than England and Wales, because we are working with a great many old stations producing cheaply and have a certain amount of hydro-electric power. Between the two we can have a certain amount of cheap electricity, but, as the stations have to be replaced by more expensive modern stations, the position may change.

So far as we see in the framing of this Bill, the Secretary of State has not made the slightest inquiry into that question. He has not told us anything about the effect of electricity on the future, how it is to meet Scotland's problems and whether we shall be better off or worse off as a result. I hope that in his final speech he will illumine this question by the researches he has made of what will be the result for Scotland following this Bill.

Under the Bill, Scotland will be in an extremely interesting position. The Secretary of State will be responsible for a great many interesting experimental developments in production of electrical power. Already he is responsible for the production of power by water, coal and steam stations and, under the Bill, he will be responsible for the production by the use of peat. The constituency of the hon. Member for Caithness and Sutherland (Sir D. Robertson) will be the source of a great new power, atomic energy. That is not under the Secretary of State, but under the Ministry of Fuel and Power.

Mr. Gerald Nabarro (Kidderminster)

I am sure the right hon. Member would not wish to mislead the House. The atomic energy plants in the North of Scotland have nothing to do with the Ministry of Fuel and Power. They are controlled by the Atomic Energy Authority, Statutory responsibility for which rests with the Lord President of the Council, and the Minister who answers in this House is the Minister of Works.

Mr. Woodburn

I quite agree with the hon. Member and apologise, but, when electricity is produced by atomic energy, I understand that it will pass under the control of the Minister of Fuel and Power.

Mr. Nabarro

The electricity produced by nuclear processes will be sold to the North of Scotland Board or the South of Scotland Board and then used through the grid for standard purposes.

Mr. Woodburn

I thank the hon. Member. In any case, the atomic energy production will not be under the Secretary of State but under the Authority. Production of electricity by wind power will be under the Secretary of State. All these very interesting experimental methods of producing electricity will be the concern of the Secretary of State, and I wish to ask how, under this Bill, he will co-ordinate them and co-ordinate production by atomic energy. If that is to be done under the grid, the position is quite clear—

Mr. Emrys Hughes (South Ayrshire)

Is my right hon. Friend aware that the Government resisted an Amendment giving power for an advisory council on atomic energy in Scotland?

Mr. Deputy-Speaker

That does not arise under this Bill.

Mr. Woodburn

We gather that this Bill gives power to extend rural electrification. It was not possible to discuss that in the debate on new Clauses. I hope the right hon. Gentleman will make reference to that in his reply. Although hon. Members opposite do not seem interested in rural electrification tonight, I think they will be in favour of it when they return to their constituencies. The right hon. Gentleman may give us an idea of what is to be the future of these new developments. A fund can be set up for the development of the purposes of the board.

Is there contemplation of a long term plan for Scotland in regard to electricity? The hon. Member for Kidderminster (Mr. Nabarro) takes a great interest in the possible shortage of coal in 10 to 15 years' time. Has that been contemplated when framing this Bill? In his new capacity as leader for electricity in Scotland, has the Secretary of State made plans for the future of Scotland in regard to electricity production by these various methods?

Is the right hon. Gentleman sure that he has in his power under this Bill the capacity to supply the growing industry of Scotland with the necessary electricity to keep the economic life of Scotland flourishing and well? Will he have to import electricity? What, under this Bill, is to be the future of the super-grid? Is that to be developed by stations in these regions or used to import from the coal areas of the North of England? What schemes has the Secretary of State, as the great new designer and planner of electric power in Scotland, to tell us about in regard to the future of Scottish industry and power?

The House is interested, and this is not a party question at all. It is a question of great importance to Scotland as to what will happen to its interests. I think that all of us on this side of the House have mixed feelings about the Bill. All of us are in favour of the maximum administration of Scottish affairs within Scotland, provided that it will not injure the economic life of Scotland. In many cases a break with England and trying to establish artificial frontiers at the border will bring great economic disadvantages to Scotland.

Has the Secretary of State satisfied himself that the creation of this break will not be, in the future, to the economic disadvantage of Scotland? Perhaps he will give us some information about that because while it may be all right to wave the flag no one wants to wave a flag over an economic desert. We want the flag to be flying above a prosperous people, and we are entitled to ask the right hon. Gentleman for information about the economic prosperity of Scotland and the possibilities that arise under the Bill, If the right hon. Gentleman will tell us some of these things, he may provide a justification for the Bill.

As I say, some of my hon. Friends have mixed feelings about this Bill. While we want the general administration of Scotland to be done locally as far as possible, which is common sense, we do not want that to be done foolishly. During the General Election, the Conservative Party made foolish promises. When I was Secretary of State, I asked many of the bodies concerned what more power they could use than they already had. All the bodies I asked said that there was no power that they could get which they had not already got. I could not find people among those who were responsible for excellent administration in these matters who would say that there was any power which they needed that they had not got. Therefore, while theoretically it might have been a great gesture to stick on a new label it seemed to me just humbug for me to have transferred apparent powers when the transfer of any real power was not possible.

This is a practical matter, not a political one—what is practical and efficient, and what will lead to the best results, not what will lead to the best advertisement, which is a very temporary thing for any political party. We are not approaching this matter in a party spirit at all but on a common-sense basis that electricity is a practical proposition from an industrial point of view and should be administered in the most efficient way.

I believe that there may be some advantage in what the Bill is doing in combining generation and distribution. It may be that the inquiry will produce similar results in England. That is a matter of opinion, and there are legitimate differences of opinion on both sides of the House. Like every other Bill, this Bill has good bits in it, and we welcome to some extent the gesture in relation to administration in Scotland, but we have never been quite satisfied that there has been any practical reason for the Bill. We think it may prove to be a disadvantage in future, and we wait for the Secretary of State, even at this late hour, to give us some justification for bringing forward this Bill and breaking up the general electricity organisation of this country.

9.10 p.m.

Major W. J. Anstruther-Gray (Berwick and East Lothian)

I find myself agreeing with much of what the right hon. Gentleman the Member for East Stirling-shire (Mr. Woodburn) said. However, I thought that in his general approach he was unduly at pains to pour cold water on the Bill. My own attitude towards it is a good deal more optimistic. I intend to support the Third Reading for the same reason as I supported the Second Reading—because I see grounds to hope that, as a result of the Bill, we shall get more electrification, particularly in the rural areas. As my constituency includes some hill areas where electrification is very much needed, I am obviously only too anxious to support anything that will help in that direction.

I want to ask the Secretary of State whether he can give me some assurances as to how this will come about. I appreciate that I shall no longer be chased off to somebody in England, to the Minister of Fuel and Power, when I am putting a case for electrification in Scotland. I shall have access to the Secretary of State for Scotland, who is at the same time the Minister for agriculture in Scotland. Therefore, if I am basing a case upon the needs of agriculture, it seems to me that I can be confident of receiving more sympathetic treatment and a more sympathetic hearing from the Secretary of State than I should from a Minister not concerned with agriculture.

I should like an assurance from my right hon. Friend as to how direct his contact with the Scottish Board will be. If I put to my right hon. Friend a scheme which I have in mind at Westruther, where there are 35 premises in the village, 15 farms, 57 farm cottages, two mansion houses and three small cottages all in dire need of electricity—the case has been put time and again but always with disappointment—I want to feel confident that under the Bill my right hon. Friend has power to take action.

That brings me to the next point, one of capital expenditure. The answer which those of us who pressed for further rural electrification in the past always came up against was that greater allocation of capital expenditure for rural development was required. I want to cite to my right hon. Friend the case of a farm near Coldstream. The reason electrification was not granted was that …in the present financial year we are dealing with applications made during 1945 and with the capital at our disposal we are not able to deal with any application more recent than that. Will my right hon. Friend find himself with greater powers under the Bill for authorising capital expenditure? When listening to the debate on the Gas and Electricity `Borrowing Powers) Bill on Friday, I wondered where Scotland came in. An increase in borrowing powers to the extent of £700 million for electrical development was authorised. I have no doubt whatever that, if so large an increase is to be authorised for England and Wales. Scotland must come in somewhere. I gather that Scotland does not come in under that Bill, so I am asking my right hon. Friend for an assurance that we are going to receive an extra capital sum for electrification in Scotland. I also ask him for an assurance that he will see to it that a proper proportion of that extra sum is devoted to the rural areas for the benefit of agriculture and the farming community.

9.15 p.m.

Miss Herbison

The Joint Under-Secretary of State for Scotland made a very short Third Reading speech, and as he spoke I thought what an optimistic fellow we had here; indeed, much more optimistic than Mr. Micawber ever was. He said that he felt that the main principles of this Bill were now accepted, and he went on to say that we were more or less agreed on the details of the Bill. Of course, that is not the case. My right hon. Friend the Member for East Stirlingshire (Mr. Woodburn) has pointed out many details on which we are still in doubt. Indeed, many of us are very much in doubt about the nature of the Bill and what the Government hope it will do for Scotland.

The hon. and gallant Member for Berwick and East Lothian (Major Anstruther-Gray) said that he supported the Bill, and then proceeded to put to the Joint Under-Secretary some very important questions which showed indeed that, although he said he supported the Bill with confidence, he is a very simple fellow indeed, for I hope to show, when I come to the question of capital investment, about which the hon. and gallant Gentleman asked questions concerning the supply of electricity to particular farms and areas, that the Secretary of State has no greater authority than he ever had before.

Major Anstruther-Gray

I am in no doubt whatever that this Bill will do good. My only doubt is how much good it will do.

Miss Herbison

The hon. and gallant Gentleman now says that he is in no doubt that the Bill will do good, but that what he is not very sure about is the extent of that good. Yet the questions which he has asked concerning his own rural area, which is similar to an area in my own constituency, are the ver), questions that are not answered in this Bill and which have never been answered by any Minister who has taken part in the debates.

During the Second Reading debate, the Secretary of State for Scotland said: It will certainly provide a closer contact between the new board, or the supplier of electricity, and the people of Scotland, who are the consumers."—[OFFICIAL REPORT, 3rd February, 1954; Vol. 523, c. 375] What balderdash there is in that statement. Again, we have never had one sentence either from the Secretary of State or the Joint Under-Secretary in this debate to show us how there will be any closer contact between the Scottish people and the supply of electricity.

I want to ask the Secretary of State a question on this. Does this mean that the Scottish people, the consumers of electricity—Mrs. Brown, or Mrs. Smith, or Mrs. Mack, or the industrialists—[Interruption.]—or Mrs. Stewart, whether it is spelt Stewart or Stuart, will have to be queueing up at St. Andrew's House to complain that electricity is not being supplied as it should be in their homes? Is that what the Secretary of State means by that statement? If it is not—

Mr. Hobson

Will my hon. Friend say whether Mrs. Stewart will be getting electricity from Carlisle or Newcastle? Can she give us a guarantee that it will not be so?

Miss Herbison

My job in this debate is not to give guarantees about anything. I am trying to get guarantees from the Government. A guarantee from this side is not worth anything in this Bill so long as we are in opposition. We are dealing with the Bill and with the statements of the Secretary of State. I want the Secre tary of State to answer my question: Where in the Bill are the provisions for closer liaison than we have at the present time between the ordinary Scottish people and the supplier of electricity? Is this just another bit of window dressing? Does it mean that Mrs. Stewart—spell it either way—or Mrs. Mack will still go to the consumers' councils that we already have? The Secretary of State, having made that statement as an important contribution to the Second Reading debate, ought, at this late stage, to give us a definite reply.

Listening to the hon. and gallant Member for Berwick and East Lothian both today and on the Second Reading, and to other back benchers on the Government side, one feels that, as a result of the Bill, the Secretary of State will have a marvellous fairy wand, All he will have to do is to wave this fairy wand and huee generating stations will leap up all over Scotland. In their speeches, they have been trying to lead the Scottish people to believe that the Bill will provide much more electricity much more quickly to our Scottish people. Neither the Secretary of State nor the Joint Under-Secretary has made those statements. I hope that the Secretary of State will be quite specific in his answers to his own back benchers and will tell them clearly that there is no provision in the Bill to give a single extra unit of electricity to the Scottish people, or to give them electricity any more quickly or cheaply.

I ask the Secretary of State also to reply not only to this side but to his own back benchers, and say whether, before he produced the Bill, he had any evidence that the British Electricity Authority had at any time hindered any development in Scotland. It is important that we and the Scottish people should know the answer. All that I hear from the Government side is praise for the British Electricity Authority. If the Bill is necessary, hon. Members must have some reason for criticising the British Electricity Authority for hindering proposed developments in Scotland, but no such reason has been given so far.

Another point is important to our Scottish people. The Secretary of State and the Tories have been trying to tell them that the Bill gives autonomy to Scotland in the supply and generation of electricity. That is nonsense. It is not only just nonsense but completely dishonest of the Government to suggest that there is a vestige of autonomy given to Scotland under the Bill. [Interruption.] If the hon. Member for Edinburgh, South (Sir W. Darling) has an interruption to make, I wish he would get up and make it.

Sir William Darling (Edinburgh, South)

I was only reminding the hon. Lady that we had local autonomy in Scotland for electricity, and that it was the Government which she supported which took that autonomy away from Edinburgh, Glasgow, and other cities.

Miss Herbison

I do not object to that; what I object to Ls the fact that hon. Members opposite say that the Bill gives back power to local authorities to generate and distribute electricity. It does nothing of the sort. It is merely a change of wording, or heading. as my right hon. Friend said.

Will the Secretary of State be good enough to tell us whether the South of Scotland Electricity Board is going to be free to develop capital expenditure as it wishes? That is what the hon. and gallant Member for Berwick and East Lothian wanted to know, but I think we already know the answer. During the Second Reading debate the Joint Under-Secretary of State said: The hon. Member for Central Ayrshire (Mr. Manuel) was worried about the limit of £75 million. This is arrived at by taking first the schemes to which the B.E.A. is already committed in the south of Scotland. and secondly, the schemes that are planned for the future.—[OFFICIAL REPORT, 3rd February, 1954; Vol. 523, c. 488.] The answer to hon. Members opposite who believe that the Bill will mean more capital expenditure and capital development plans is that almost the whole of the £75 million is going to be spent on projects which have already been decided, which means that there will be no change in the amount of development that is to take place.

Scottish people have a right to know that the Bill gives no autonomy to the Secretary of State for Scotland. He will be in the same position as was the Minister of Fuel and Power. If a scheme were put forward by a Scottish electricity board and the Minister of Fuel and Power supported it, he had to make a case to the Treasury. That is exactly what the Secretary of State has to do. Even when the Bill becomes an Act, the power will reside in the same place as it does now—in the Treasury.

Although the area which I represent is not completely rural, I know that much still needs to be done in the was of rural electrification. It is a very expensive job. It would have been much easier to obtain more rural electrification if we had maintained the existing set-up and—

Sir W. Darling

Local authorities.

Miss Herbison

Local authorities had the chance to do something for many, many years, but they failed to electrify these areas. With the best will in the world, they found it impossible to do this job. It is not charity for one great industry, covering the whole of Britain from Land's End to John o'Groats, to help the rural areas, whether they be in Scotland or Wales. It is not charity to expect it to pool its resources and to help. That is what I hoped would happen when electricity was nationalised. This step which the Government are taking will make it impossible. We in Scotland are able in other ways to help our friends in England and Wales. This help is a two-way traffic, for Scotland and Wales can help England when need arises and England can help Scotland and Wales when need arises, and, the word "charity" ought not to be brought into this discussion.

Will the Bill help my people in North Lanarkshire? Will it help all our Scottish people? It is with those questions in mind that I have examined the Bill. I have no hesitation in saying that, for some of the reasons I have given, the Bill even now as amended, will not help the Scottish people in their desire, first, to have a more stable economy and, secondly, to have the better standard of living that a more stable economy ensures.

I criticise the Bill first because it does not give the Scottish people greater control over their electricity but is rather an attempt to hoodwink them into thinking that it does. I hope that this debate will make it clear that there is not greater autonomy. I criticise the Bill on the second score that it does nothing to help the economy of Scotland and to help my people to attain a better standard of living. My third criticism of the Bill is, from my point of view, as the representative of many thousands of miners, most important of all. I am glad that the Parliamentary Secretary to the Ministry of Fuel and Power is in his place now that I come to this criticism. The Secretary of State, on Second Reading, said: This is a Bill to make the Secretary of State the Minister responsible for electricity matters in Scotland and to set up in Scotland a new board answerable to him for the generation of electricity in the South of Scotland in the same way as the Hydro-Electric Board is responsible in the North."—[OFFICIAL REPORT. 3rd February, 1954; Vol. 523, c. 369.] I have attempted to show that those words were mere eyewash, but the Minister of Fuel and Power and the Parliamentary Secretary know that there is a committee, called the Reorganisation Committee, of the British Electricity Authority that is in continual session, I understand. Did that committee recommend to either the Minister of Fuel and Power or to the Secretary of State the measures proposed by this Bill?

That is a question which the Secretary of State ought to answer tonight. The question was put to the Joint Under-Secretary of State and he tried to hide behind the fact that it is a committee of officials of the various boards, and that its work is just to advise the British Electricity Authority. What nonsense for the Joint Under-Secretary of State to hide behind that sort of statement. Of course, it is quite true that it is a committee of officials, but if this were as important a Measure as the Secretary of State would have the people of Scotland think it is he ought to have had upon it the advice of a committee that spends all its time dealing with the problems of the reorganisation of electricity. The Secretary of State must tell us whether this Reorganisation Committee made any suggestion to him on these lines.

Throughout the debate not one reason has been adduced by either Front Bench or back bench speakers opposite to show that this new arrangement for Scotland is being introduced for any technical or economic reasons. There has been no such reason given, no suggestion of cheaper electricity or faster development of electricity supplies—no reason whatever why this proposed reorganisation should be brought about.

In the past, the South-West and South-East Electricity Boards in Scotland were under the Minister of Fuel and Power. I have no hesitation, as a Scottish Member, in saying that I still want those boards to be under the Minister of Fuel and Power and not to be under the Secretary of State for Scotland. I will tell the House why. Coal is a very dearly-won raw material, and the winning of it means broken and wasted bodies. I see them every day in my own communities. It is because I feel that this commodity, used so much in electricity, is such a dearly-won commodity; it is because I see those men with scarcely a breath in their bodies, some of them going about in their wheel-chairs as a result of having won this coal in the past—it is because of these things that I do not want a single ounce of coal to be wasted. That is why I am so completely opposed to the decision to join these boards into one board and to place it under the Secretary of State for Scotland and take it away from the Minister of Fuel and Power.

When we nationalised coal, electricity and gas, I hoped that that would eventually lead to the greatest possible co-ordination of these three industries—a co-ordination which is possible if they are under one Minister. Even then it is no easy job, but how much more difficult, indeed perhaps how impossible, it will be to bring about that close co-ordination, and to make sure that every ton of coal produced is used in the best possible way, if we have this new arrangement. Under the new set-up, such co-ordination will be almost impossible.

I had hoped that the Minister of Fuel and Power had some plans already in being for this close co-ordination and that he realised from the Ridley Report the importance of using our coal to the best advantage. Electricity is one of the biggest consumers of coal in the country. I understand that it uses 35 million tons a year at present—I am told that it is 36 million tons, so I am not far out—and I believe that in 16 years it will be using 63 million tons.

Although in the earlier part of my speech I have given reasons why I oppose the Bill, the main reason is that I realise that the reorganisation and co-ordination of these three important industries can best be carried out if they are under one Ministry. It is almost impossible for it to be carried out when this part of the industry is hived off, giving no real power to the Secretary of State but being hived off for political window-dressing, irrespective of whether it will benefit our nation and our people.

9.40 p.m.

Mr. Nabarro

I rise to congratulate my right hon. Friend on bringing this interesting Measure to its Third Reading, having successfully piloted it through the various stages which have lasted since 3rd February when the Bill had its Second Reading.

From a political point of view, this Measure honours an election undertaking which—I beg to differ from the right hon. Gentleman the Member for East Stirling-shire (Mr. Woodburn)—was not a foolish pledge, as he called it. I hope to be able to stress once again, in the course of a short speech, that there are very sound economic and technical reasons why the amalgation of the boards in the Lowland areas of Scotland should have been carried through. First, I should like to say that in the 1950 election the Unionist Party in Scotland was quite unequivocal in what it wished to do in regard to electricity generation and distribution. [An HON. MEMBER: "Gas and coal."] I will talk about that another time. I am now talking about electricity. The election manifesto stated: The creation of a single all-purpose authority. In fact, instead of creating just a single authority it does retain the North of Scotland Hydro-Electric Board, in accordance with the provisions of the 1943 Act, and in addition creates a single board for the Lowland or Southern areas of Scotland. I was impressed when the Joint Under-Secretary of State for Scotland suggested on an earlier stage of this Bill that it might be a progressive step on the "Right Road" to create ultimately a single authority all of which would have many technical and economic advantages.

Before this Bill came to the House there were in the South of Scotland four organisations—the South-Eastern Scotland area of the British Electricity Authority, the South-Western area of the 'British Electricity Authority, the South-Eastern Area Board and the South-Western Area Board—to cover less than four million people, and those four organisations were concerned with generation and distribution. It is interesting to observe that those four organisations put together in the shape of the South of Scotland Board proposed under this Bill are in terms of population, in terms of electricity generated and in terms of electricity sold, less than the average of one area board in England, which was considered by the party opposite to be an economic unit either for generation or for distribution in the terms of the 1947 Act.

Mr. Manuel

What about Worcestershire?

Mr. Nabarro

The problems of Worcestershire are not so parochial in character that they have no similarity anywhere else in the United Kingdom. In fact, what my hon. Friend behind me had to say about the problems of rural electrification in South-Eastern Scotland are exactly the same problems as we have in Worcestershire, Herefordshire, Gloucestershire, and other more remote rural areas of England.

It is undoubtedly the fact that, for purposes of administration and technical progress, an administrative unit covering four million people and covering installed capacity for electricity purposes of about 1,100 megawatts—as was the case when this Bill was brought to this House—as the combination of two lowland boards is the most convenient and most efficient, both for generation and for distribution purposes.

It was suggested by the hon. Member for Lanarkshire, North (Miss Herbison) that the proposals in this Bill are going to waste coal. If they were going to waste coal, I would have had a great deal to say about them at an earlier stage. In fact, by close integration of water, steam and other forms of generation the probability is that coal will be saved and not wasted.

The unique part about Scotland's electricity arrangements today is their diversity. Nowhere in the world is there a country which has such diversity of facilities for electricity generation as Scotland has today. She has thermal power stations based on coal, water power stations based on hydro-electricity, wind-power stations in the North of Scotland, power stations based on peat supplies, she has an atomic power station in course of construction at Dunreay and numerous oil or diesel driven stations—six methods of generating electricity within one country that has just five millions of population. That diversity is not to be found anywhere else in the world.

The point I make is that the lesser the number of authorities that control that diversity of operations, the more efficient should the operations become and the greater the economy in coal that is achieved. [Interruption.] I am not making the hon. Lady's case, because she said quite clearly that the provisions of the Bill would waste coal. I am saying that they will save coal.

Miss Herbison

The hon. Member has not proved his contention at all. The important provision against which I spoke through the whole of my speech was the taking away of power from the Minister of Fuel and Power and giving it to the Secretary of State. That was my case, which is the type of case that the hon. Member is making when he says that he would prefer to see everything combined under one authority.

Mr. Nabarro

Yes: but I am satisfied that by placing them under two authorities instead of under six organisations we are making progress towards the single multi-purpose authority.

I wish to say a word about the question of capital investment, which has loomed largely during our deliberations upon the Bill, and the allegations which have been made this evening by hon. Members opposite that there may be insufficient capital moneys available to carry out the legitimate desires of Scotland's electricity expansion programme. Under Clause 12 (3), the maximum borrowing powers of the two electricity authorities in Scotland are, respectively, £200 million, as was previously fixed under earlier statute, for the North of Scotland Hydro-Electric Board, and £75 million for the Lowland Board. It is difficult to ascertain how much of that £75 million authorised as the maximum of borrowing powers will have already been expended by the time the Bill came before us this evening for Third Reading.

As far as I am able to tell, approximately £19 million, correct to the nearest million pounds, was expended in respect of the South-West Scotland Board to 31st March, 1953, and £9 million only in respect of the South-East Scotland Electricity Board, a total of £28 million between the two boards, which are merged together to become the South of Scotland Board. I should like my right hon. Friend when he replies to confirm that the total sum borrowed so far by the two area boards is £28 million. If so, it means that £47 million is still available within the borrowing powers under the Clause to which I have referred, before the maximum and upper limit is reached.

Mr. Manuel

The hon. Member says that the difference between £28 and £75 million is available to the board. It is only of value to Scotland if we know when the Treasury will authorise it.

Mr. Nabarro

I looked carefully last Friday to see whether the hon. Member would be present during our debate to give me the benefit of his advice. Fortunately, he was not here. Had he been present, he would quickly have learnt that although borrowing powers and their upper limit are settled by this House—and what we did last Friday was to pass the Second Reading of a Bill to increase the borrowing powers for electricity and gas in England and Wales—once those borrowing powers are settled the nearly autonomous nationalised undertakings may then go to the money market as they deem necessary, for their money.

In fact, what will happen under this Bill is that £28 million out of the £75 million will have already been spent by the two lowland area boards. Out of the £48 million which remains, we should be able to cover all the capital development requirements for electricity in the South of Scotland for quite a long period ahead, and the actual process of borrowing that money will, of course, be the customary resort to the money market and public issues. I can see no justification whatever for the allegations of hon. Members opposite that the purpose and effect of this Bill will be to restrict sums of money available to my right hon. Friend for the maximum electricity development both in the Highlands and in the Lowlands.

In conclusion, I regard this measure as an important pointer to what should occur with other branches of the nationalised industries in securing the maximum possible devolution. In the case of Scotland it has a special interest in that the devolutionary movement restores to Edinburgh and to my right hon. Friend full autonomy in electricity generation and distribution in Scotland. In fact, there is only one remaining measure of restriction, which is of a financial character which might be placed on my right hon. Friend, and that measure is applicable to every nationalised industry which raises its money, namely, the Treasury guarantee.

Other than that Treasury guarantee and the sanction for it, there will be complete autonomy in Scotland and the statements made by the hon. Lady were, therefore, completely misconceived and quite ill-informed. I hope this Bill will have an unopposed Third Reading and that it will swiftly pass through another place, for it will demonstrate to the whole of the United Kingdom that it is just one more unionist election promise which has been faithfully fulfilled.

9.52 p.m.

Mr. Palmer

The extraordinary feature about this Bill is the amount of time it has taken. It may have been forgotten by the House that we gave a Second Reading to the Bill in the far-off days of February. It may be that it is so feeble that it has taken nearly six months to crawl from Second Reading to Third Reading. In Committee we on this side laboured very hard in the attempt to put the crooked straight, and we did that in two notable instances. We have thrown out those futile Clauses, 4 and 5, which took up space and added printer's ink to paper without communicating, either good sense or direction to the industry; and we succeeded in amending the Schedule to the Bill in such a way as to preserve the important principle of United Kingdom negotiations for salaries, wages and conditions. [Interruption.] I would say to the hon. Member for Edinburgh that—

Mr. Ross

Edinburgh. South. My hon. Friend must not include all the Members from Edinburgh with the hon. Member for Edinburgh, South (Sir W. Darling).

Mr. Palmer

I do not wish to do any injustice to my hon. Friends on this side of the House. In answer to the hon. Member for Edinburgh, South (Sir W. Darling), I should like to assure him that the Amendment on collective bargaining machinery was welcomed by the electricity workers of Scotland who did not wish to be divided from the rest of the United Kingdom in the matter of wage and salary negotiations. We did succeed in getting the right hon. Gentleman the Secretary of State to see sense on this point, and the trade unions are grateful that the change was made.

However, there is always a limit to what even a conscientious Opposition, such as the present one, can do to improve a thoroughly bad Bill. In complete contradiction to the hon. Member for Kidderminster (Mr. Nabarro), I am as convinced as ever I was that to divide the responsibility for the administration of the grid and the super-grid between the British Electricity Authority and the new board is a mistake which will not bring any advantage to electricity supply administration in Scotland or to the consumers.

We have had the argument that this is the only country in the world where generation and distribution are separated. The answer is simply that this is the only country in the world where geography and natural conditions enable the advantages of a closely-knit, inter-connected system on a nation-wide scale for the generation and bulk transmission to keep down operating costs.

In any case, if this Bill is so sound from a technical point of view, why is it that the Government at no stage have been able to quote any impartial expert opinion in favour of the change? On the other hand, I have succeeded at varying stages in quoting impartial opinions outside this House against the change. At least the Government might have waited until the new committee of inquiry which they appointed, which we heard all about on Friday, and which is to report on the organisation of the B.E.A. and the electricity boards, had done its work.

There are still outstanding many points of considerable obscurity. No one has explained if the surplus electricity from the North of Scotland hydro scheme, which is exported, will in future be absorbed entirely by the South of Scotland Board or whether the B.E.A. will take some of it from time to time. We have heard nothing about machinery to *** be set up for the working together of the British Electricity Authority, the new South of Scotland Board and the North of Scotland Board. We have to remember that in future, unlike the 1947 Act, neither the chairman of the South of Scotland Board nor the chairman of the new authority will sit on the B.E.A. We have heard nothing at all about arrangements for joint United Kingdom electricity activities which of necessity must be carried on.

As far as the staff of the industry are concerned, it is proposed now to merge in one organisation the two existing area boards and the two existing generating divisions. Will there be staff redundancy? I am sure the staff in the industry are still interested in that point. Is there any preliminary organising committee at work, such as was set up before the B.E.A. was established?

It would be possible if the hour were not so late to speak at length on the faults of this Bill, but I will spare the House. In my view and in the view of my hon. Friends, this is a mistaken Measure in its basic conception but, should it reach the Statute Book, most of us would wish that those who have to carry out its provisions should succeed in what they have to do. This at least can be said, that the technical men, the administrators and the workpeople in the electricity supply industry of this country have a knack of making the best of legislation. However, here tonight we have a right and duty to say that they should not have been placed in the position where they have to make the best of legislation. I am as convinced as ever that this is a thoroughly had Bill and that it should be rejected.

10.0 p.m.

The Secretary of State for Scotland (Mr. James Stuart)

The right hon. Member for East Stirlingshire (Mr. Woodburn) asked me several questions, as did other hon. Members, and I will do my best to answer them in a short time. I was asked the reasons for the introduction of this Bill. The whole scope of the Bill and the reasons which prompted us in introducing it will be found in the OFFICIAL REPORT of the debate on Second Reading, if anybody chooses to study it.

Briefly stated again—and it has been said already by my hon. Friend the Member for Kidderminster (Mr Nabarro)—we believe in the Bill because we believe in decentralisation. Our object in introducing the Bill and in achieving this measure of decentralisation was to obtain closer contact with the consumer, who never seems to be mentioned in these debates, and to see that his needs, which we in Scotland understand best, are attended to as far as possible. [An HON. MEMBER: "How?"] We propose to do that by having an organisation in Scotland, by taking these duties out of the hands of the British Electricity Authority and the Minister of Fuel and Power and having a committee of Scotsmen managing this concern in Scotland. That is the object and that is what we have stated in our policy. That is another reason for introducing and carrying through the Bill, and having promised to do so, it is better than we should carry out our promise.

Mr. T. Fraser

Will not the right hon. Gentleman agree that the authority with whom the consumer has contact is the distributing authority and not necessarily the generating authority, and that under the existing law the consumer will have contact with the distributing authorities—the area boards—and that the contact will not be changed? Is the Secretary of State hoping that the consumer will not even know that there has been any change?

Mr. Ross

Are we to take it from that nationalistic promise that all Englishmen who are presently employed in the generating side of electricity in Scotland will have to be sacked?

Mr. Stuart

No, it does not mean that. The organisation operating in Scotland will look after the interests of Scotland and we shall get the best people that we can obtain to do the work. Anybody who did not obtain the best people possible to organise an industry would be very stupid. We undertook to do this work because we believed it to be in the best interests of industry in Scotland and of the consumer in Scotland whose interest we, at any rate, have at heart. The hon. Lady the Member for Lanarkshire, North (Miss Herbison) should read some of the writings of her hon. Friend the Member for Dundee, East (Mr. G. M. Thomson) who said in the June issue of "Scotland": …how to prevent the nationally owned industries becoming over-centralised will be one of the principal problems of political organisations during the years ahead… This is one of the steps to prevent it from becoming over-centralised.

Miss Herbison

I have no objection whatever and indeed agree fully with the statement which the right hon. Gentleman has just read from the writings of my hon. Friend the Member for Dundee, East. However, I am still waiting to hear—and the right hon. Gentleman has not answered the point in his previous statement—how this Measure will provide closer contact. The right hon. Gentleman has given us some platitudes but no answer at all.

Mr. Stuart

I have not been allowed to proceed with my argument for very long, but it is perfectly clear that if one has one's organisation established in Scotland it is closer to one if one lives in Scotland than if the organisation is established elsewhere. If the hon. Lady the Member for Lanarkshire, North and the hon. Member for Dundee, East cannot settle their difficulties in this matter, they might invite the chairman of the North of Scotland Electricity Board to join in the discussion, because we all agree that that board works satisfactorily and is in the best interests of Scotland. We are trying to establish in the South of Scotland an organisation set up on exactly the same lines as that in the North of Scotland.

Mr. Pryde

Does the right hon. Gentleman agree with the hon. Member for Kidderminster when he proposes the elimination of the North of Scotland Board?

Mr. Stuart

I am not in agreement with my hon. Friend on that, but it is not possible to agree with everyone on everything. On general principles and important matters my hon. Friend does support this Bill.

My hon. and gallant Friend the Member for Berwick and East Lothian (Major Anstruther-Gray) asked how direct my contact will be with the new board. The answer is that it will be direct and precisely the same as that with the North of Scotland Hydro-Electric Board. I know that contact and set-up both as a Private Member and as a Minister, and I can assure my hon. and gallant Friend that it will work. I think that all hon. Members from the North of Scotland will agree that the set-up there has been a success.

My hon. and gallant Friend and my hon. Friend the Member for Kidderminster asked about capital available for development. Clause 12 of the Bill gives the new board power to borrow £75 million for new development in generation and distribution. It does not cover any expenditure already incurred by the B.E.A. and the area boards, and I believe it to be sufficient to tide over development for the next four years. When the exhaustion of available capital is reached, of course it will be necessary to come to this House to get authority for further capital investment.

The hon. Member for Cleveland (Mr. Palmer) mentioned methods of disposing of surplus electrical current which he said had not been referred to. There will be no change in the existing practice; it will proceed as at present.

I assure the House that the object we had in mind in introducing this Bill and proceeding with it was very fully explained on Second Reading on 3rd February. I do not want to go into a lot of repetition. I do not think that at this time of day the House would wish me to do so.

I must make it quite clear that I never said the B.E.A. had in any way hindered Scotland's development. My words on that subject will be found in column 370 of the OFFICIAL REPORT of the Second Reading debate. I have also stated quite clearly that we believe in this as being in the best interests of the consumer in Scotland. It is a workable set-up, as has been proved by the precedent of the North of Scotland Board, which has been a success. I am confident that this is a popular Measure in Scotland. Therefore I hope that the House will give it an unopposed Third Reading.

Mr. T. Fraser

The right hon. Gentleman has failed to tell the House of any benefits which will come to Scotland as a result of passing this Bill. Before the Question is put, can he give us an assurance that the people of Scotland, if the Bill becomes law, will have the same kind of service as they got when the Minister of Fuel and Power was responsible in the South of Scotland?

Mr. Stuart

I can not only assure the hon. Member of that, but we believe that they will get better service.

Question put, and agreed to.

Bill accordingly read the Third time, and passed.