§ Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Legh.]
§ 4.1 p.m.
§ Mr. Tudor Watkins (Brecon and Radnor)
I want to raise the important question of capital contributions towards rural development electricity schemes. As I shall have some criticism to make about the area board in my constituency, I should like to pay tribute to the very great work which the South Wales Electricity Board and the Midlands Electricity Board have done in Brecon and Radnor and in the areas covered by them since vesting date.
I have gone to the trouble of ascertaining exactly what has happened since vesting date in the constituency which I represent, and I find that 58 villages have been supplied with electricity for the first time and that in only one small hamlet have the consumers been asked to pay a capital contribution. It is true that isolated units in those areas have made contributions either voluntary or on the suggestion of the area board. According to the National Farm Survey 1941–43, in Radnorshire only 1 per cent. of the farm holdings have electricity and in Brecon-shire only 4 per cent. In spite of that. I pay tribute to the boards for the very excellent work that they have done and I want them to continue that excellent work because the activities of the boards make a great contribution to rural repopulation.
Only yesterday we heard the Minister for Welsh Affairs say that great progress 861 was taking place in rural electrification. Unfortunately, because of a new policy of the South Wales Electricity Board with regard to rural development schemes, I am afraid that progress may be stopped, and I should like, therefore, to suggest changes in that policy.
There has been a new policy since the autumn of 1952, and I call this new policy nothing but a tax on villages. I should like to give illustrations. This new scheme was introduced in the Fifth Report of the South Wales Electricity Board, and particulars of it can be found in paragraphs 40 to 43. It is also interacting to find that the consultative council, who are not at all happy about this new scheme of a tax on villages, have asked for a sort of trial period; they have also asked for a line scheme to be considered, and they have pointed out the problems which are facing most of the villages under the board. I cannot speak for the other areas under that board, but I want to concentrate upon my own constituency. This new policy has changed the attitude of rural dwellers towards electricity, and I would like the Minister to give us some indication whether these schemes which are now in operation will be reviewed.
There has been no difficulty about these village schemes in the past. Only during the last four months has this problem arisen to any great extent. I have tried every avenue, right from the Sub-area District Manager to the Chairman of the British Electricity Authority, and I have got no satisfaction. That is why I take it upon myself to raise the matter with the Parliamentary Secretary this afternoon. I am not against the principle of capital contributions. They must be called for from isolated units in certain cases, and up till now there has not been much opposition. But I do not like the taxing of villages.
Who will have to pay for this capital contribution in the villages? I suggest that it will be the small chapels, churches, village halls and schools. Big farms may not be asked to do so, but even if they are they will have the advantage over the schools, churches and chapels, because they can claim Income Tax relief, or. if they are in a hill farming or livestock rearing district, a 50 per cent. grant from the Minister of Agriculture.
My constituents cannot understand why some villages are asked to pay this 862 capital contribution and others are not. The village of Nantmel has been asked to pay£160 for a very limited scheme, whereas the neighbouring villages of Llanwrthwl, St. Harmon and Pantydwr do not have to make any contribution. That is an anomaly. The people in the three villages use the same markets and, perhaps, the same chapels. The people of Gladestry have told me that they have been asked to find£625, while Walton and other nearby villages have not been asked to make any contribution. Beulah—a lovely village, which is a continuation of Cilmery and Garth—were first asked to make a contribution of£366, whereas the other two villages were not asked to make any. This request was refused, and since the fact that I was going to raise this matter was mentioned the village is not now being asked to pay any capital contribution, except by means of guarantees.
They have no objection to that. I would much prefer these contributions to be made in this way. Once the supply of electricity is provided, anybody coming in from outside will have to contribute. The first guarantee will be asked of a limited number of consumers, and when others come in later, as the area is developed, the guarantee will be reduced to those who were already there. But I cannot understand why contributions are asked from villages which are being supplied for the first time. I have noticed that other area boards do not ask for capital contributions in those circumstances.
I have studied the reports of every area board in the country, and the South Wales Electricity Board area is the worst of the lot. The Board says, "We want a certain contribution from such-and-such a place," and they ask the local people to decide for themselves. Those who are urgently in need of a supply of electricity will unwillingly pay contributions. If they do not agree to pay no supply is provided. As I pointed out, if a farm refuses to come into the scheme, the Chairman of the South Wales Electricity Board replies, "We shall change the layout of the scheme and omit those premises." That may mean an increase in the charges for bringing electricity to the village. This is altogether a wrong policy. We ought to have more co-operation. I do not know what 863 the experience of other hon. Members is, but I do not get much co-operation from the Chairman of the Board in South Wales.
Would-be consumers who want electricity urgently agree to most of the capital contributions, but at Nantmel the Baptist Chapel and the church are expected to pay£22 10s. each, and the school£10. In Breconshire 14 schools have been supplied with electricity since vesting day, and not one of those schools has been asked to make a capital contribution. Why does the board come down upon those schools that are within the area of rural depopulation that the panel recently surveyed and reported on to the House of Commons? People cannot understand it. If the schemes of the North Wales and Merseyside Board were applied to some of the villages in North Breconshire and Radnorshire those capital contributions would not be anything like what they are. Indeed, under the North Wales scheme they would be considerably less.
The village of Gladestry is in the heart of the hills of Radnorshire. It has a church, it has a school and two fine chapels. With another hamlet it has 25 consumers who were asked to find£625. For no apparent reason at all the board suggests£373 now. That is the figure, I am given to understand, that is to be imposed upon that village. If the scheme of the North Wales Board were applied to that village the charge would work out at between£50 and£75. In that area they are side by side with Midlands Electricity Board, and the Midlands Board thought that the village came under it. When the villagers asked the board about the contribution they were told they would not have to pay. Later they found that they did not come under that board. In Beulah the first tax was£366. Later it was reduced to£295 Now, as to the schools. In Ystradfellte in southern Breconshire they were asked to find the first£50 of the capital contribution with a guarantee of£18 for five years. It has since been changed to£27, and the school there has only 27 children in two classrooms. It is an impossible amount to guarantee for the next 20 years.
I am sure the Parliamentary Secretary will agree that a situation of this kind 864 needs looking into. There should be a further review of the scheme at Nantmel and Gladestry as to the policy of capital contributions administered by one section of the sub area district located in Llandrindod Wells. Farms that can and could use a great deal of electricity and that could come in have not been asked to link up. More information ought to be obtained about developments. A tax is put on a village without any inquiry being made to find out whether new housing developments will take place there or not.
I ask the Parliamentary Secretary whether the capital contributions as now administered could be replaced by guarantees for the reason I gave at the beginning. I ask, what are the intentions of the board about the report of the Consultative Council? Will the schemes of the Midland Board and the North Wales Board be considered, or the line rental scheme? I am certain that some better scheme could be produced for the areas I am speaking for.
Yesterday, the Minister for Welsh Affairs, with whom we all agreed, said that rural electricity development schemes should progress in the Mid-Wales area because they are not only a great advantage to food production but a great amenity in the countryside. I hope that we shall have an assurance from the Parliamentary Secretary that these schemes will be carried out with the full cooperation of the people concerned and particularly those who understand something of the type of development which should proceed in the countryside.
I am sorry that it has been left Co me to raise this matter so late on a Friday afternoon, and I apologise for that to the Parliamentary Secretary, but I hope that we shall have something done even if it is no more than a review of what is going on at the present time in these areas.
§ 4.16 p.m.
§ The Parliamentary Secretary to the Ministry of Fuel and Power (Mr. L. W. Joynson-Hicks)
I should like to thank the hon. Member for Brecon and Radnor (Mr. T. Watkins) for the courteous way in which he has raised this subject and the kind remarks he has made about me, but I confess that he has put me in a particular difficulty this afternoon. He has told the House that before raising the 865 subject here be has tried every avenue to obtain satisfaction on the points he has laid before us. As far as I can make out, however, that is not quite correct. He has not tried the Consultative Council. That Council is the statutory body which has been set up, with a representation of all the consumers and potential consumers in the area, to deal with exactly this type of detailed criticism which individual people may have concerning the activity of the electricity board to which the Consultative Council relates.
Probably the main responsibility of my right hon. Friend, in reply to a debate of this kind, is his responsibility for the appointment of the members of the Consultative Council. If the criticism were against the Consultative Council it would be open to my right hon. Friend to take drastic steps with regard to the appointment of its members, but the hon. Member has raised no criticism whatsoever of the Consultative Council. As I followed the hon. Member's remarks, the real basic anxiety which he has expressed to the House is a rather curious one. It is that the principle which was followed by the old company which was serving his constituency before nationalisation, that is the Shropshire, Worcestershire, and Staffordshire Electricity Company, has not been followed since nationalisation, when the South Wales Electricity Board took over. Coming from the hon. Member, that is a curious comment to make upon the results of nationalisation.
I accept the hon. Member's argument as being well founded in his estimation. The reason for the change, however, is that under the nationalisation Act the various boards were required by statute to standardise the methods of charging throughout their areas. In all the areas there was a multiplicity of methods of charging and of assessing costs to the individual consumer, both for linking electricity to the premises and for the supply of the electricity. Consequently, there has had to be a considerable amount of variation.
The first introduction of the capital charge in the area of the constituency of the hon. Member was by the board, which carried on until 1952 the old system which operated when it was taking over so that it could thoroughly probe and investigate the needs of the locality and the methods which could be 866 adopted in order to fulfil its statutory obligations. That is why only comparatively recently the change to which he referred has taken place.
There is one point on which I want to join issue with the hon. Member. That is in the use of the phrase "a tax on villages." I think it is a rather unhappy phrase, and I am sure the hon. Member will not mind my saying that it is a rather misleading phrase. There is no question of a tax in the sense in which any bon. Member would recognise the phrase. What is happening is that the boards are in one way or another recouping the cost of what they are supplying. If it is necessary, in order to supply electricity to an individual, a village, or farm, or any main centre of population, to put in high tension cables, transformers, low tension cables, and even direct service lines, they have to be paid for somehow or other.
The board do not make a charge for high tension cables or main transformers. They are paid for in the normal course of the economic activities of the organisation. But they do charge in one way or another for the cost of putting up low tension cables, poles and so forth and possibly some local transformers, which are required only to supply a particular individual locality, or farm. If those lines have to be carried a long way the cost is clearly more than if they have to be carried only a short way. That accounts, to a certain extent, for the doubt in the mind of the hon. Member—which could easily have been resolved had he gone to the Consultative Council—of why some villages are charged and others are not.
It may well be that the cost of linking up one village is comparatively small because there is an available supply at low cost, whereas linking up another village may cost considerably more because of the distance which the line has to be brought. Again, one village may very well have a much greater potential requirement for electricty. Therefore, there would be a very much bigger turnover in the supply of the product and, consequently, a greater revenue would arise from it. The greater the revenue the less the contribution required to meet the servicing and charging on the overhead system.
867 The hon. Member also made reference to alternative methods of charging. The House will recall that it was just over a year ago—on 19th June last year—that my right hon. Friend, at this Box, made an appeal to the industry to ensure that it did not rely solely upon one method of charging in order to meet the capital cost, but offered alternatives. I am very glad to say that the industry has responded to that appeal and that all the boards now offer one or more alternative, instead of relying solely on one method of recovering capital cost.
The hon. Member referred to some of those methods, deferred payments, line rentals and so on. I can assure him that in some cases the board have got to the point, particularly in the more progressive areas, where it is possible for them to proceed without asking for any form of contribution towards the capital cost because of the increased revenue they are able to arrive at as a result of the increasing consumption.
That is why the hon. Gentleman is in a difficulty, because his constituents are far too conservative-minded, at any rate in their use of electricity. If only he would liberalise them a little it would assist him considerably. It is a remarkable thing that the people of South Wales, when they have electricity, use it in such small quantities that it renders it very difficult for the board to obtain an adequate revenue on the service which it supplies. If the hon. Member can encourage his constituents to be a little more liberal in their use of electricity it will certainly help the board and thereby help his constituents as well.
The hon. Member also made reference to the board which covers North Wales and the system that it uses for the recoupment of capital charges there. What may suit one area may not necessarily suit another one. That scheme was considered by the Consultative Council for the South Wales area; it did not consider it would be suitable for its area. I would remind the hon. Member that the consultative council in that area is exceedingly efficient and very strong. The hon. Member is in the particularly fortunate position of having no fewer 868 than two members on the Consultative Council in his constituency, namely the Chairman of the Brecon County Council and a member of the Radnor County Council.
In the few minutes which remain, I should like to say what progress is being made in South Wales generally. I have expressed the view at this Box that at about this time progress would be made. That is certainly taking place. The B.EA. had its main 132-kilovolt line energised from Carmarthen to Carmarthen Bay since December last year. That part was the first vital thing to get done. That has been achieved, and the extension of the line from Carmarthen to Haverfordwest will be energised next month. That will make it possible for development to take place in that area.
The capital expenditure authorised last year, in the announcement of my right hon. Friend, enabled the board to do its development work in parallel with the extensions of the high tension lines which were being carried out by the Authority. Consequently, although in 1952–53 it was possible to take electricity to only 396 farms, in 1953–54 the number jumped to 955. In the current year, 1954–55, it is estimated that the number will be more than 1,000 farms, so that tremendous progress is being made in that direction.
Finally, in the area represented by the hon. Gentleman, the board is itself developing with great rapidity a 66 kilovolt line, which is a high tension line that is going forward at a rapid rate, and which last winter was completed from Abergavenny up to Brecon, and development is now taking place there. By next winter an extension of the high tension line will have been completed from Brecon to Builth Wells. That again will make possible far more rapid development in the southern part of the hon. Member's constituency. In the light of the progress which has already been made, the hon. Member can be assured that that advance will be carried out; and if he can persuade his constituents to use rather more electricity they will probably be able to get it rather more cheaply.
§ Question put, and agreed to.
§ Adjourned accordingly at Half-past Four o'Clock.