§ 3.41 p.m.
§ The Chairman
I think that the first Amendment on the Notice Paper, in page 1, line 17 after "principal", to insert "(i)" is a printing Amendment and, therefore, it is not necessary to move it.
§ The Minister of Fuel and Power (Mr. Aubrey Jones)
I beg to move, in page 1, line 17, after "section", to insert:made before the expiration of five years from the commencement of the Coal Industry Act, 1956".The purpose of this Amendment is twofold—first, to remove a misconception, and secondly, to provide an extra opportunity for Parliament to scrutinise the way in which moneys made available to the Coal Board under the Bill are used.
1550 First, with regard to the misconception, the Coal Board's new investment plan is a 10-year plan. There is an expenditure of £1,000 million over 10 years. Since the plan is a 10-year plan, it was, I suppose, natural to assume that the advances intended under this Bill were for 10 years. Throughout the Second Reading debate there were frequent references to this Bill as a 10-year Bill, and more than one hon. Member asked me specifically to reduce the term of years from 10. In fact, this was never a 10-year Bill. The application of the Coal Board with respect to finance did not extend to 10 years, nor was it the intention that the Bill should extend to 10 years. The application of the Coal Board is summarised in page 21 of the Coal Board's document "Investing in Coal." These are the Board's words:They"—that is, the Coal Board—may require to borrow up to an additional £400 million in the next five years. If the Board were able by means of higher prices to wipe out the accumulated deficit in that period, the amount required would be reduced to about £350 million.As for the intention of the Bill, the intention with regard to five years was expressed—at least, I tried to express it—in the speech with which I opened the Second Reading debate. This is what I said:It"—that is, the Coal Board—has asked for added borrowing power representing, at most, £400 million. The Board has put it that this borrowing is necessary to see it over the great heave of investment for the next five years. Beyond the next five years, as investment dwindles and as the depreciation provisions from past investment improve, it is estimated that the Board will be entirely self-financing."—[OFFICIAL REPORT, 10th May, 1956; Vol. 552, c. 1440.]The intention always was, therefore, that the advances provided for in this Bill should be for five years, and this Amendment now makes clear that intention and, I trust, puts the matter entirely beyond all doubt and all misunderstanding. I am only sorry that misunderstanding arose in the first place.
But beyond that, this Amendment, as I have said, provides an extra opportunity for Parliament to scrutinise the way in which the moneys made available to the Board under the Bill are used. If I am a true prophet, much of our discussion 1551 this afternoon will turn on this issue of Parliamentary accountability, and all I would say about it at this time is this. It is right and proper that this House, as the instrument by which capital and finance is made available to the nationalised industries, should exercise a scrutiny over the way in which the finance is used. None of us, I would hope, in any quarter of the Committee, would question that, because, after all, to question that would be to question the whole constitutional being of this Chamber. That, I trust, is beyond all doubt.
The problem, as I see it, is to provide for this scrutiny without, at the same time, creating doubts in the minds of the nationalised undertakings that Parliament supports long-term investment, because if there is any doubt about Parliament's support of finance for long-term investment, then, clearly, the investment is jeopardised and it will not be carried through. The problem, therefore, is to reconcile Parliamentary scrutiny with certainty.
This task of reconciliation, like most problems of reconciliation in politics, is not an easy one. The Bill as drafted and unamended attempts this reconciliation. It provides opportunities for Parliamentary scrutiny when the annual level of advances exceeds £75 million. Whenever it exceeds £75 million, then I have to come along to the House to seek approval for exceeding that limit. That is to say, in the earlier years when particularly heavy advances are foreseen, or in any year of extraordinarily heavy advances, Parliament will have an opportunity for scrutiny.
This Amendment provides a still further opportunity for scrutiny, at the end of five years. If the five years were to expire before the additional £350 million written in the Bill were used up, legislation would be needed and the matter would automatically return to this House.
All in all, either as a result of the annual limit of £75 million or as a result of the new time limit of five years suggested by this Amendment, I expect that the House will have an automatic opportunity of scrutinising the way in which the finance is used in most of the years out of the five—almost certainly, I 1552 would say, in three, and possibly even in four.
But it may be asked: what about the missing year, or years? How can we provide for Parliamentary scrutiny in the missing years while still observing the canon which I mentioned earlier about ensuring certainty for investment? I propose henceforth, at the beginning of every financial year, to publish a White Paper. This White Paper will describe what has happened in the way of investment in the year just elapsed in all the nationalised fuel and power industries, as well as the projected programme for the impending year.
§ Mr. Jones
I cannot answer for the Minister of Transport. I am only concerned with fuel and power, but I think I would be right in saying that my right hon. Friend the Minister of Transport would not be averse from doing something on the same lines.
The White Paper, as I say, will describe investment in the year which has elapsed and the programme for the impending year. It would also estimate at the beginning of the financial year the likely level of advances to be required during that year. Since the White Paper would relate to all the nationalised fuel and power industries, fuel and power investment would be seen in its proper perspective. What is more, I should like to emphasise that the White Paper will not be merely retrospective, but will be prospective; it will be a forecast as well as a picture of what has happened.
It is the intention of the Government, so far as one can now foresee these things, to provide ample time for debate on such a White Paper in the years when, otherwise, under the Bill, investment in coal did not come before the House automatically for review—that is, either when the money limit of £75 million or the time limit of five years did not operate.
In short, this Amendment to insert the period of five years, coupled with my White Paper, rounds off the opportunities for Parliament to review the course of investment, while satisfying my canon that the investment should not be subjected to uncertainty. On that ground, 1553 as well as on the ground that it is surely desirable to remove a misunderstanding, I commend this Amendment to the Committee.
§ Mr. J. Grimond (Orkney and Shetland)
The Minister took it as axiomatic that everybody would be in favour of closer Parliamentary scrutiny. I do not in the least wish to disagree with that, but I do not myself feel that he paid quite enough attention to the timing of the scrutiny and the information to be scrutinized. I certainly feel that one of the difficulties in the House is that we are presented by nationalised industries with large plans already drawn up, with global figures, and we virtually cannot learn how these plans were ever arrived at, and we have great difficulty in questioning details within the plans.
Useful as annual scrutiny may be, we should be told a little more as to how it is to work. I take it that most investment plans in coal must be very long-term, and it really is not possible for the House of Commons from year to year to say it would like this investment cut down or that investment increased, as the case might be. It would surely put the Coal Board in very great difficulties if substantial differences were made in that way.
If that he so, is not this control, of which the Minister has spoken, to some extent illusory, and are we not thrown back again upon this, that we ought to be quite sure that any particular programme is really discussed in greater detail and approved by the House before it is embarked upon at all? I personally feel that that is the vital factor in any discussion of investment in the nationalised industries. I do not consider that we are given sufficient details of the way in which these large programmes are drawn up, and we are not shown how they are related to investment programmes in other industries, such as oil, which is extremely important, or the investment programmes, for example, of the Atomic Energy Authority.
I hope that the Minister will tell us a little more about how much we shall find in the White Paper of which he spoke. That is extremely important. He said, as I understood, that the White Paper would cover all the fuel and power industries. I have before suggested that we ought to have a committee of experts to look at 1554 all these investment programmes of the nationalised industries, and that the committee should have before it, also, the investment programmes, of, say, the big oil companies so that it can advise on the whole situation. Is it intended to put into the White Paper the forecasts, which presumably the Government can get from them, of the oil companies as regards their investment? We know the Government are taking more trouble to get these forecasts as accurately as they can from these large industries. Will such information as that be given in the White Paper?
Furthermore, we must again say that this investment is investment in a wasting asset; it cannot be anything else. If we are to get full value for it, it is absolutely vital that it should go along with better recruitment and productivity in the industry. That really will be the ultimate, decisive factor in whether these astronomical sums of money yield to the nation a proper return or not.
§ Mr. Arthur Palmer (Cleveland)
I welcome the proposal that we should have this White Paper on the investment programmes of the fuel and power industries. As some of my hon. Friends know, I have fairly strong views on this matter of Parliamentary accountability, but in the matter of capital investment I think there is this difficulty. If we are to have just the figures for the fuel and power industries—a very important part of the national economy—will those figures mean a great deal unless we have accurate figures for the whole of the economy? If the figures for coal are to mean anything, they must surely be stated in relation to the whole economic picture of the country.
Suppose we are told that in a particular year the figure for coal is to be £20 million or £40 million, who is to say it is the right figure for the particular year? It seems to me that that does depend upon the total level of investment. Of course, this applies to electricity and gas, for which the right hon. Gentleman has responsibility, but surely it must also apply to the motor car industry and to engineering. If I remember correctly, there was a time when we did have these figures in the Economic Survey, in the days of the late Sir Stafford Cripps, though I cannot remember just how much 1555 detail there was. We are certainly not provided with these figures at present.
It seems to me, therefore, that the demand of hon. Gentlemen opposite, who are generally known, I think, as the "Tory coal rebels", for figures, particularly on coal, is really associated with their generally demagogic approach on this problem.
§ Mr. Palmer
If the hon. Member wants an investment programme for the whole economy, that is excellent. But I cannot really believe that he is at heart a planner; I think he is, if anything, an economic anarchist. Nevertheless, I think that it is an excellent start, though only a start, to have the figures for what I call the energy industries.
The right hon. Gentleman will encounter many difficulties if he really undertakes something like an energy policy for the country, though it is certainly badly needed. For my own interest, I have listed his difficulties, as I see them. In the public sector of his responsibilities, there are some powerful autonomous corporations, which are obliged by Parliament to balance their accounts and pay their way each year. In the private sector, there is oil, which is a vast industry, with wide international ramifications, only one end of it being under his influence.
As the field of nuclear fission and the power stations associated therewith, development of which is likely, in the nature of things, to be a slow process, it will really be a separate empire altogether; it is not the direct responsibility of the right hon. Gentleman, but comes under another member of the Administration who is to be found in another place.
In those circumstances, it seems to me that, though we shall have a White Paper, and though we shall have some figures, it is very doubtful whether they will really represent a policy. At present, the responsibility for capital allocations in the fuel and power industries is undoubtedly extremely loose. It depends a great deal not only on the whims and fancies of the Government and the ups and downs 1556 of their economic policy, but it probably also depends on the relative power of various pressure groups within the publicly-owned industries. I have always been delighted when electricity has done reasonably well. I have been less pleased—it is an old, professional fad of mine—when the gas industry has pushed ahead, but the fact is that both gas and electricity have done relatively well in the matter of capital allocations in the last few years, while the coal industry, on which they depend, has done badly.
§ Viscount Hinchingbrooke (Dorset, South)
On a point of order. Would you be good enough to indicate to the Committee, Sir Charles, whether you are likely to restrict the discussion on the Question, "That the Clause stand part of the Bill," in view of the rather general debate which is now developing, because some of my hon. Friends and myself may want to indulge in a wide debate rather than on the point we have put down in our Amendment?
§ The Chairman
Much of what the hon. Member for Cleveland (Mr. Palmer) has been saying up to now would be more appropriate to the discussion on the Question, "That the Clause stand part of the Bill."
§ Mr. Palmer
Thank you, Sir Charles; I will confine my remarks to the Amendment. To sum up in this way, if this is a step towards a monetary policy—and it may be that the right hon. Gentleman will indicate whether it is or not—I say it is a good thing, but I rather suspect that it is but a facade to cover the understandable difficulties which the Minister is having with his back-benchers.
§ Mr. Nabarro
I am privileged, and not a little gratified, to find my name along with that of my right hon. Friend the Minister to the Amendment on the Notice Paper. My right hon. Friend has described the purpose of his Amendment as something which is hardly to be regarded as in the nature of an advance towards the point of view which was expressed by some of my hon. Friends and myself in the Second Reading debate, and it is quite possible that there was a degree of misconception as to the span of the proposals in this Bill during the Second Reading. That is understandable, because it is very difficult to analyse precisely the meaning of the National Coal 1557 Board's document "Investing in Coal", as to the span of years over which it envisages its £1,000 million capital investment programme would run.
My right hon. Friend quite rightly said that there were two considerations inherent in his Amendment. The first is the matter of the length of years that the investment for which we are hoping under the Bill will run, and the second is the question of Parliamentary accountability, and whether or not it is desirable to have an annual scrutiny of this investment programme or one over a longer period of years. I wish to address myself to each of those questions.
My right hon. Friend has said that the whole of the borrowing powers under this Bill will, in effect, be exhausted during the first five years, and that that was always his intention. It follows from that, and this was his second comment this afternoon, that during the second period of five years which will make up the 10 years' span, the whole of the investment of the Coal Board will be forthcoming from the Board's own internal resources, namely, from its depreciation and associated provisions, by the accountancy system with which we are all acquainted in the Board's annual report and accounts.
§ Mr. Nabarro
My hon. Friend says that we do not understand it. It is, I suppose, exceedingly difficult to understand.
I want to direct the attention of my right hon. Friend to what I am sure was an inadvertent omission on his part from his Second Reading Speech, because it touches precisely on the point I am making. In the Second Reading debate on 10th May, I put this question to my right hon. Friend:He said that two-thirds of the capital investment to which he referred would be found from the Coal Board's own resources. Would he justify that to the House by saying on what depreciation principles and on what price structure he has based his assumption that two-thirds of the whole of this vast sum of money can be found from the internal resources of the Board?My right hon. Friend then replied:If my hon. Friend will curb his impatience, as we all know he is well capable of doing, I will deal with that point in a moment."—[OFFICIAL REPORT, 10th May, 1956; Vol. 552, c. 1440.]1558 In fact, I call my right hon. Friend's attention to the fact that he did not deal with it.
§ Mr. Nabarro
I will come to the Amendment in a minute, but, if I might, I should like to take this a little further, because it has direct relevance to this massive financial matter.
The fact is that my right hon. Friend said this afternoon that the Board's borrowing powers would be exhausted in the first five years, and that is why he is putting a five-year restriction in the Bill by this Amendment. I am asking him how he can be sure that the borrowing powers will be exhausted in the first five years, and, flowing from that, can he be sure that no borrowing will be required by the Board in the ensuing five years?
What I am saying is directly related to the Amendment. My right hon. Friend did not give the Committee this afternoon any precise answer to that question which I posed, and which remained unanswered on Second Reading, namely, what are the depreciation principles of the Coal Board, and on what price structure has he based his assertion that its finances and moneys available will be adequate during the second period of five years to finance its investment programme, as enunciated in the document "Investment in Coal", entirely from its own resources.
I do not want to suggest that these estimates may be wrong. I am grateful to my right hon. Friend for his Amendment to put this five-year limitation in the Bill, and, at this juncture, I want to say with all the force at my disposal that it was never my intention on Second Reading, or today, to circumscribe or limit in any way legitimate investment for the increased production of coal. What my hon. Friends and myself have been so worried about is the length of time——
§ Mr. E. Shinwell (Easington)
Will the hon. Gentleman define what he means by legitimate investment?
§ Mr. Nabarro
I will. There is another Amendment on the Notice Paper in my name, and if the right hon. Gentleman 1559 will bide in patience for just an hour or two he will hear me making a speech on this subject of legitimate investment, and I will deal with his intervention in greater detail then. What I want my right hon. Friend to justify when he responds to this short debate on this Amendment is his confidence that these borrowing powers will indeed be exhausted after five years. I want him also to justify his belief that in the second five years of the 10-year plan it is going to be possible for the Coal Board to find the whole of its investment money from its own resources. I would remind the Committee that the Coal Board has never been right in these matters. It has always been wrong in its estimates of the sums of money it would require to borrow year after year, and of the sums of money it would, therefore, be able to provide from its own depreciation and associated resources.
On that point, I am grateful to my right hon. Friend for making it perfectly clear, to the doubting general public as well as to this Committee, that his intention is that the borrowing powers in the Bill will only run for five years, and that, as he mentioned, there will be an annual White Paper on investment, about which I now want to say a word or two.
The White Paper on investment will not satisfy my scrutiny year by year unless it gives a great deal more detail than just a global sum for each of the fuel and power industries. I want to know, for example—and this touches on the intervention of the right hon. Member for Easington (Mr. Shinwell)—what is the legitimate investment in colliery production and raising more coal and what is, what I consider illegitimate, investment in a number of ventures which are not directly associated with the raising of coal. That is just one division which should be brought out in the White Paper.
I shall also want details of the capital investment moneys expended in the preceding year as well as capital investment moneys anticipated to be required in the ensuing year. I shall want my right hon. Friend to write into the White Paper particulars of major colliery schemes. I shall want him to write into the White Paper full particulars of the amount of 1560 coal which he expects to raise, and when, from each of those major colliery schemes.
In other words, I shall want him to tell the House—[Interruption.] It is all very well for hon. Members opposite to jeer rudely, but I want him to tell the House what the taxpayer will get in return for his money. This is the taxpayers' money. It is money provided below the line in the Budget estimates. In that connection, it has a direct relevance to what my right hon. Friend had to say this afternoon.
Today's Daily Express comment was right on the point. [HON. MEMBERS: "Did you write it?"] No, I did not write it. I am in no way associated with Lord Beaverbrook. I am merely a distant admirer of his Lordship. The Opinion column of the Daily Express says:Take a look at the Welsh wonder mine at Nantgarw. It cost £5,000,000.I apologise if I pronounced the name incorrectly. I will willingly spell it.
§ Mr. S. O. Davies (Merthyr Tydvil)
I want to tell the hon. Member that we have no such place in the whole of Wales.
§ Mr. Nabarro
I hope I shall be forgiven, in view of that intervention, if I spell the name. It is spelt N-a-n-t-g-a-r-w.
It cost £5,000,000. The estimated output was 750,000 tons of saleable coal a year.Since the wheels started turning in 1951, Nantgarw has never produced even 300,000 tons a year. Of the 2,000 miners needed the Coal Board has found only 900.Now the board appoints Mr. H. E. Collins to supervise new sinkings. A thousand million borrowed pounds will be spent in Britain, as he says.No more Nantgarws, Mr. Collins. That's our money you are spending.It is the taxpayer's money.
It is for that reason that I want my right hon. Friend to make it abundantly clear to the House of Commons that he will not write into this White Paper merely a few global or aggregate figures of the capital investment in respect of each of the nationally owned industries under his jurisdiction, that we shall be at least given in respect of previous and ensuing years the capital cost and the production related to them. If he does not provide enough detail in the White Paper, then, of course, there will be substantial pressure from my hon. Friends and myself 1561 on my right hon. Friend to become a great deal more expansive in the material which he lays before the House of Commons.
I hope that my right hon. Friend will view with sympathy my interest in these important matters.
§ Mr. Nabarro
Sit down. I will give way in a moment.
Having made an important advance towards the point of view expressed by my hon. Friends and myself on 10th May, I hope that my right hon. Friend can see the further opportunities in the White Paper which all of us so legitimately desire.
§ Mr. Shinwell
In that case, may I ask the hon. Gentleman a question? If he wants all this information about previous and future costs and the rest of it, would he at the same time, in order to come to a sound conclusion about whether it is worth while investing, require an extensive and exhaustive report of the mining engineers who have examined the project? If that information is not available to him, it is quite impossible for him, who is inexpert in such technical matters, to make up his mind.
§ 4.15 p.m.
§ Mr. Nabarro
The House of Commons is notoriously inexpert in many technical considerations, but on this side of the Committee we are not inexpert in safeguarding the taxpayers' money. As all the capital investment programme under the borrowing powers under the Bill are to be found in below-the-line finances in the Budget, my hon. Friends and I have every need to scrutinise annually the capital investment sums that have been invested in this fundamentally important industry.
§ Mr. Callaghan
I have listened to the debate with very great interest. We have had the spectacle of the Minister moving an Amendment to his own Bill and the further spectacle of the hon. Member for Kidderminster (Mr. Nabarro) putting his name to an Amendment whose implications he confesses he does not understand, in view of the requests which he has made 1562 to the Minister to explain to him what happens at the end of five years.
We have also had—the greatest surprise of all—hon. Members opposite, including the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke), protesting at the use of the word "rebel". Since when has that been a dishonourable title? I thought that in the Conservative Party it was a very honourable thing to be a Tory rebel, especially on the subject of coal. I am bound to say that I could understand that the Minister should be very pianissimo when moving words which had been put into his mouth by the hon. Member for Kidderminster, but I do not understand why the noble Lord should protest when somebody calls him a rebel. He is a rebel, a successful rebel, and he should be proud and delighted about it.
§ Mr. Callaghan
I have very good ears and I heard the noble Lord's interjection.
As was said by my hon. Friend the Member for Cleveland (Mr. Palmer), it is no use looking only at the surface. One must see what underlies it. I should be much happier about the Amendment if it were not for the equality of its support on the Order Paper. During the Second Reading debate all the hon. Members who are now supporting the Amendment, with the exception of the hon. and gallant Member for South Fylde (Colonel Lancaster), protested in greater or lesser terms that the Bill was offensive. The hon. Member for Kidderminster said that it was offensive on five counts, and proceeded to explain what the five counts were. He voted against the Bill.
§ Mr. Callaghan
I thought that that might provoke the hon. Member into voting, and if it did I am delighted.
We feel that what lies behind the Amendment is not the reasonable and statesmanlike approach of the Minister, but the approach of the Tory rebels who want to fetter, make less flexible, to hamper, crib and confine the activities of the coal industry. That is what lies behind the Amendment. Hon. Members must make up their minds whether that is what they want to do or not. Some say that it is and some say that it is not. 1563 From the speeches which were made on Second Reading, it is clear that the purpose of the Amendment is not to assist the coal industry, but to hamper it.
I congratulate the Minister on the skill with which he put the case. If the Minister says to the Coal Board that the powers he intended to give it to borrow a certain sum over a period are now to be halved and that he is to give those powers for half the period, he clearly makes the financial policy of the Coal Board less flexible than it otherwise would have been.
The hon. Member for Kidderminster did a little arithmetic on Second Reading and told us that 10 years into £350 million made an average borrowing of £35 million a year. He was right, of course, and that is perhaps the way the Coal Board would have liked to have financed this programme. Perhaps it would have preferred, over a period of 10 years, to have borrowed about £35 million a year and to have raised the rest each year from its own ordinary financing, but the effect of the Minister's Amendment is to prevent this.
The Minister is going to force the Coal Board to borrow, if he gives it the necessary permission, much more in the first five years and to finance itself out of its own resources in the second five years. Why introduce this rigidity into the financing of the coal industry, unless the right hon. Gentleman is making a concession to the rebels who pressed him so hard on Second Reading? That is why I tell the Miniser that we are not satisfied that the explanation which he gave represents all the truth in this situation.
The right hon. Gentleman said that it is proposed to publish a White Paper every year which will set out not only investment in the past but also investment in the future. I take no exception to that. It is, as my hon. Friend the Member for Cleveland said, returning very much to the documents and Economic Surveys which were published by the Labour Government. Every year that those surveys were published there was a section dealing not only with capital investment in the past, but with the prospects for that year. The documents have since been emasculated and that particular section has disappeared.
§ Mr. Callaghan
I do not remember which year it was. I know that up to 1950 it was included, because I played some part in the matter. Certainly, during the first five or six years have Members opposite sneered and jeered a great deal about the failure of the performance to match up with the prospects that were published in that section. Now they want to return to that system.
§ Mr. Callaghan
I do not complain that they want to return to that system and I hope that we shall have a return in those statements to the details which used to be included in the White Paper. There used to be a list of the major new proposals of capital investments which the British Transport Commission, for instance, intended to undertake every year. I am nearly 100 per cent. certain that the White Paper went so far as to indicate which pits it was intended to develop. Who are we on this side of the Committee to complain if the Minister goes back to that? I am sure that none of us on this side of the Committee will regret having that additional information.
The Minister wants to see investments in perspective. In what sort of perspective? Does he propose to include in the White Paper details of the proposed investment plans of the oil companies and of the Atomic Energy Authority, and of those companies which will be building nuclear power stations for the Central Electricity Authority? Unless those details appear in the White Paper, we shall not have a complete picture but merely a partial picture of the country's fuel and power situation and outlook.
The right hon. Gentleman will have to give us a whole picture, setting out in some detail, also, the proposed investments of the oil companies, which are particularly important in this matter, or we shall not be able to judge clearly and accurately what the investment picture really means. As far as I can understand the Government's fuel and power policy, it is to get such coal as they can over the next 10 to 15 years, to continue with an atomic energy policy which will not produce anything significant until 1963–65, and to rely upon oil to fill the gap.
1565 If the statistics of the Ministry of Fuel and Power are to be accepted, that gap will be a substantial and growing one in the next 10 years and the oil industry will have to double its output. How can the Minister tell us that he wants to give a picture in perspective of investments in our energy needs, unless we can see how far that is a balanced picture through having included in it all sources of fuel and power? The right hon. Gentleman said that he intended to include only the nationalised industries.
Although my hon. Friend the Member for Cleveland welcomed all this as an attempt to get near a fuel and power policy, it is nothing of the sort. It is merely an attempt to placate the rebels. If the right hon. Gentleman tells me that he is ready to include as much detail in the White Paper about the proposed investments of the oil companies as he intends to include about the nationalised fuel and power sector, I shall begin to accept the view of my hon. Friend the Member for Cleveland that this is something close to a fuel and power plan. As it is, this is only an attempt to assist the muck-rakers below the Gangway to delve into what they regard as the weaknesses of the nationalised fuel and power industries.
I thought that the hon. Member for Kidderminster fell below his usual repartee when he replied to my right hon. Friend the Member for Easington (Mr. Shinwell).
§ Mr. Callaghan
In that case, I do not propose to comment. I am very happy to leave the matter to my right hon. Friend the Member for Easington, who has been Minister of Fuel and Power and has long experience of these matters.
§ Sir Ian Horobin (Oldham, East)
The right hon. Gentleman put 2 million men out of work when he was Minister of Fuel and Power.
§ Mr. Callaghan
On the basis of the information which we have been given, we must come to the conclusion that the proposed Amendment does not enable us 1566 to judge the Government's fuel and power policy as a whole, that at best it will present only in partial detail the statistics of the fuel and power picture, and that it is intended to hamper and cripple the nationalised industries because of the approach made to it by those who have put their names to the Amendment, apart from the Minister. For those reasons, we on this side of the Committee shall give the Minister and other hon. Members opposite the opportunity of voting for the Bill as it stands.
§ Sir Peter Roberts (Sheffield, Heeley)
The hon. Member for Cardiff, South-East (Mr. Callaghan) has tried to make out that some of my hon. Friends want to establish more control over the capital expenditure of the National Coal Board only in order to hamper the industry. I assure the hon. Member that from my point of view, and I am sure from that of my hon. Friends, this control is desired not to hamper the production of coal but to hamper the unnecessary and extravagant expenditure which may take place. I am quite sure that no hon. Member opposite wants to see uneconomic and extravagant spending of this money. Therefore, the Opposition should support the Amendment and the Bill.
I have been pressing for greater control of capital expenditure in nationalised industries for a long time, and in some cases against Ministers representing the Labour Party. We are now seeing a change of opinion in both parties. The suggestion is being made that there should be greater Parliamentary control of these nationalised industries. I welcome that. I welcome the suggestion when it comes from hon. Gentlemen opposite since, for them, this is a new venture. I can remember the right hon. Gentleman the Member for Easington (Mr. Shinwell), during the long debates in Committee on the Coal Industry Nationalisation Bill, which became an Act in 1946, defending the argument that there should be freedom from this type of financial control. Therefore, I am glad to know that he is supporting this Bill.
Let us see exactly what it means. First, by reducing to five years the amount of borrowing by the Coal Board, it will not be practicable to expend that money. I do not think that the Board 1567 will be able to do it because of the question of technicians, of the materials available and of the planning which will be needed. So the Committee must realise that by accepting this Amendment we are reducing the figure of £6 million put before the House on the Second Reading of this Bill, and that it will be considerably less than that at the end of the five years.
§ Mr. Callaghan
Is not the hon. Gentleman aware that the sum we are really talking about is £350 million, and that the estimate of the Coal Board—which has been passed by the Minister—of capital investment this year is £107 million?
§ Sir P. Roberts
Yes, I appreciate that, but I am talking about the total capital investment from the Board's own resources in the five years. I do not believe that it will be possible for the Board to spend that money.
§ Mr. Callaghan
May we get the argument right? If the Board spends £107 million this year, and the total power we are giving it is for £350 million, why cannot the Board spend that in five years?
§ Sir P. Roberts
The hon. Gentleman is right on the particular point of the amount of money being spent now, but I was on the larger point of the capital investment in coal. The main theme we are discussing is what the Board will be able to spend in the period we are thinking about.
Secondly, how far is the Minister, in his statement this afternoon, opening the gate for Parliamentary Questions to him and his Ministry during the course of the year? As I understand, he will come before the House from year to year as the sponsor of the capital investment programme of the Coal Board for that year. Unless he does come forward with responsibility as such, and does answer from the Treasury Bench the points which may be raised from any side of the House, the debate may well be out of order.
Therefore, if the Minister is responsible at one time in the year for the development of, say, a particular colliery, he cannot subsequently divest himself of that responsibility. It must mean that if the Minister comes forward with a 1568 detailed scheme of capital investment in any particular colliery, it will be open to any hon. Member to ask him subsequently, even after a month or two months, how that capital development is proceeding. I hope that the Minister will underline this point.
If that is right—and I believe it is—it is a large and fundamental step forward in Parliamentary control of the industry, and one which I welcome. But we must appreciate what is happening, and I hope that the Minister, when he replies, will agree with my interpretation of his responsibility, because he cannot in a subsequent week divest himself of the responsibility he has taken for something in detail in a previous week. As I say, if that is so. I welcome it as a step forward in the type of Parliamentary control which we have had so far over the nationalised industries.
Lastly, speeches have been made from the other side of the Committee asking for a wider review of the private sector as well as of the public sector of industry. I would say two things on that. First, we must take one step at a time. It has taken several years——
§ Sir P. Roberts
—in the case of the nationalised industries. Hon. Gentlemen opposite are muddling the fundamental basis of what we are arguing. We are arguing about the public spending of the taxpayers' money.
That is the basis of the argument we are putting forward, and it is not sensible for hon. Gentlemen opposite to link with that, however much they may want to nationalise a sector of industry, the scrutiny of private industry, which is responsible for its own sources of income, whereas the Coal Board and the nationalised industries are not. Therefore, that argument cannot he accepted on this Amendment.
§ Mr. Austen Albu (Edmonton)
The hon. Gentleman has referred to the taxpayers' money. Is he suggesting that loans made to the nationalised industries should be raised in the same way as Votes for Government Departments?
§ Sir P. Roberts
No, I am not suggesting that, but it seems to me that in our present financial state these figures can be put under the line, and that then the 1569 Chancellor of the Exchequer could use the surpluses to cover his below-the-line expenditure. It might well be that if ever hon. Gentlemen opposite had power again they might use current expenditure for this type of capital expenditure, which would be disastrous.
§ Sir P. Roberts
I am trying to explain to the hon. Gentleman. The point is that it is possible for the House of Commons to control the money which goes through its hands, but I hope that we are not asking, at this stage, that the same sort of control should be imposed on private industry.
§ Mr. Shinwell
I am often amused at the innocence displayed by hon. Gentlemen opposite when dealing with the subject of nationalisation. One might suppose that they were anxious to encourage the projects embodied in the proposals of the National Coal Board. One might imagine that while, in principle, hostile to nationalisation, they were not at all desirous of impeding the development of the coal industry under the Coal Board.
What are the facts? Ever since 1946, when the industry was nationalised, we have met with nothing but implacable opposition and deep-seated hostility from hon. and right hon. Gentlemen opposite on the subject of nationalisation. I recognise, Sir Rhys, that this is not an occasion for discussing at large the subject of nationalisation and, in particular, the fascinating subject of what happened in 1947.
§ Mr. Shinwell
You know, Sir Rhys, I have often thought—this is a slight digression—that the House was becoming somewhat dull and ought to be livened up. Indeed, I remember what a previous Speaker of our Assembly once said about the need for the cut and thrust of debate, and a little jollification, indeed vituperation. I should like to say to the hon. Gentleman the Member for Kidderminster (Mr. Nabarro) that he is becoming, if he has not already become, the most remarkable political blatherskite I have encountered in this House for 30 years. I think that is recognised even by hon. Gentlemen opposite. I do not dismiss the hon. Gentleman with contempt, because he does not even deserve contempt; I 1570 do not want to use too strong language, but he has become a nuisance. I will leave it at that.
Turning to the subject under review, there has been much talk about using the taxpayers' money. The argument proceeds in this fashion: if we are using taxpayers' money in the form of subsidies or credits advanced by the State, or under the auspices of the State, to private organisations and institutions then there must be a careful scrutiny by this House. Yet I recall occasions in the somewhat far off days when we subsidised some of the large shipping organisations, particularly the Cunard Line. Never a word was said in this House then, nor did we dare say a word, about the organisation of the Cunard Line, about its financial intromissions, about its day-to-day conduct, its method of investment or anything of that kind. But when it comes to a matter of nationalisation of a particular industry—the principle objected to by hon. Members opposite—then they demand a ruthless scrutiny of almost every detail.
Even if the scrutiny were agreed to and the details were furnished, what real difference would it make in what, after all, is the primary objective, if not of all hon. Members opposite, certainly of hon. Members on this side and I believe of the country at large? What effect could it possibly have on the output of coal if we implanted a little more intelligence in the mind of the hon. Member for Kidderminster? Would that produce any more coal? Of course not. Therefore, what we have to consider is not so much the investigation, scrutiny, going into the precise details of investment and the various projects; but how best can we encourage the Coal Board to proceed with its projects unimpeded and uninhibited.
That does not mean that we ought to have no discussion at all of nationalisation and nationalised projects in this House. I go much further than many of my colleagues, certainly as far as anyone on the other side of the Committee, when I say that I believe that the time has arrived when it would be very useful indeed to have discussions about what is proceeding in the nationalised industries and services—discussions of a general character. I believe that hon. Members and the public ought to be better informed. If I want information about 1571 what is happening in the mining industry or about the conduct of the Coal Board, I cannot obtain the information from the Minister of Fuel and Power; I must apply to the Board itself.
§ Mr. Nabarro
Is it in order, Sir Rhys, for the right hon. Gentleman to suggest that you should learn something?
§ Mr. Shinwell
I withdraw that at once. I am well aware of the traditions of this House. I thought that everyone in the Committee understood to whom the reference was made.
It is perfectly true that when we nationalised the mining industry, we decided to place the conduct and operation of the industry in the hands of an independent and, as we thought, autonomous organisation; but I recognise—and I admit quite freely—that as a result of experience some modification in the organisation of the Board is inevitable, far wider and more extensive than as yet transpired, and that, in addition, we are entitled, as representing our constituents—[Laughter]. Is the hon. Member for Kidderminster not well? Is there a doctor in the House? We are entitled, as representing our constituents—[Laughter]. The hon. Member is not well—and being interested in the future of the nationalised coal industry to far more information than has yet been made available through the present dispensation.
I want to say at once that the right hon. Gentleman has succumbed to the temptation of seeking to placate hon. Members of his own side. I am not altogether surprised. It requires a great deal of courage to stand up to them. The task of the Minister of Fuel and Power has never been made easy by hon. Members on the Tory side of the Committee. Whoever has occupied that position, whether a member of my own party or a member of the Tory Party, he has incurred the hostility and bitter antagonism of hon. Members on the Tory side, so I am not surprised at what has happened.
I beg of the right hon. Gentleman, if he sincerely desires to encourage the Coal Board to proceed with its projects, to take 1572 the advice of expert mining engineers who really know something about this question of development and the need for investment over a long period of years, and the technical and physical difficulties encountered in the mining industry. I beg of him not to take so much notice of what is said by hon. Members opposite, but to turn his attention to the people who really matter. That is why I object to the Amendment proposed by the right hon. Gentleman.
In fact, if that Amendment were of any value at all, it would not be supported by hon. Members opposite. That is a condemnation of the Amendment itself. I will tell the right hon. Gentleman why. The fact is that the mining industry encounters technical and physical difficulties which are quite unknown at the outset of a capital investment programme, or at the beginning of any development scheme, and it is quite impossible to say whether it is going to succeed or not.
Let us take, as a simple illustration, the difficulties about the pit in South Wales. What has happened there? They thought that they would produce 750,000 tons of coal a year. That is nothing new. In the days of private ownership of the mining industry millions of pounds were lost by coal owners, or by the shareholders, in colliery concerns when they were led to believe that the mere sinking of a shaft and its subsequent development would lead to the production of millions of tons of coal. What it often led to was a loss of vast sums of money simply because of the technical and physical obstructions and all other kinds of difficulties, such as flooding.
With all good will and with all the technical ability available to the mining industry, which has some of the finest mining engineers in the world—there is nothing wrong with the technical ability of the Coal Board—it is possible to lose vast sums of money. I say to hon. Members opposite, "Curb the National Coal Board as you like, put all the inhibitions on capital investment intended by hon. Members opposite and apparently agreed to now by the right hon. Gentleman, and what will happen?" The result will be not the development of the coal industry and the output necessary for our industries to survive, but that the mining industry will be hamstrung.
1573 I have a further point to make about the question of legitimate investment. Who can tell what is legitimate or illegitimate at the beginning? I say quite categorically that there is not a single mining engineer in this country—and I could name most of them—who would be able to prophesy with any degree of certainty that as a result of an expenditure of £5 million or £10 million in the sinking of a shaft and its subsequent development, it would be able to make that pit pay. It is quite impossible.
I have the experience in my constituency of a large colliery undertaking where they are driving many miles under the sea in order to produce coal because other seams are exhausted—seams which were expected to be prolific in coal production. As the hon. Member for Orkney and Shetland (Mr. Grimond) reminds me, we are dealing with a wasting asset. As a result of the exhaustion of seams in South-East Durham, they are developing under the sea. They have discovered physical obstructions as a result of which it will cost many hundreds of thousands of pounds before any coal can be produced at all.
With all our ability and all our good will, how is it possible for us to determine whether the expenditure of £5 million or £10 million or £300 million will pay in the long run? In the coal industry it is largely speculative; we have to speculate to get the coal in the future. We may win out, and I believe it is the desire of the general public that we should win out and get the coal we need, but in spite of all the expenditure, all the fine plans, all the scrutinies and all the great care exercised by the right hon. Gentleman to placate his hon. Friends, there is no guarantee that we shall get the coal we need. We have to try it out. It is a very great task. We hope that we shall succeed, but there is no guarantee that we shall.
My hon. Friend the Member for Cleveland (Mr. Palmer) and my hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) were right; if we are to have a review or if a prospectus is submitted about the future of the fuel and power industries, they cannot be considered in water-tight compartments. I have said for a long time that the three fuel and power industries ought to be integrated; we ought to remove from them every element of competition. That is the first 1574 stage. We cannot discuss that in detail now, and I merely put the point.
We have also to take the oil industry into account. It is not merely a question of the amount of oil which is being produced in various parts of the world. At any time it may be discovered by an industrial undertaking that it will pay it better to use oil rather than coal. If that becomes general, or if, as a result of propaganda, industrial undertakings prefer to use oil rather than coal, or if in the next 5, 10 or 15 years we see the beginning of the use of atomic energy, what will happen to the coal industry?
We must, therefore, take the whole subject in our stride, including both the production of coal from the bowels of the earth and open-cast production. I see the hon. Member for Harrow, West (Sir A. Braithwaite) here; he rendered great service to the nation, against a great many obstacles, in seeking to develop the production of open-cast coal. We must consider together the production of coal from the bowels of the earth, open-cast production—in spite of objections from the agricultural interests—oil production, electricity production, gas production and the production of by-products. We have not developed the production of by-products as we should have done. The right hon. Gentleman must take all these things in his stride, and if he is to produce a White Paper let him tell the whole story and not just part of it. It is like running a department store, if I may use a homely illustration.
§ The Deputy-Chairman (Sir Rhys Hopkin Morris)
I do not want to interrupt the right hon. Gentleman, but I am puzzled to find the connection between his argument and the Amendment.
§ Mr. Shinwell
We are dealing with whether we ought to reduce the amount of capital invested over a period in the mining industry, or whether we should revert to the original plan of the Coal Board.
I am coming to my conclusion. In dealing with the fuel and power industries, in which I include not only indigenous oil, but oil made available for distribution in this country, we must consider them all together. I use the illustration of a department store in which one loses money on one counter and makes it up on another. That is precisely 1575 our position here. We may lose money on the production of coal from the bowels of the earth and make it up on opencast production, although that does not seem to be likely. We can gain profit from the production of electricity on a much more extensive scale than at present, for we have only touched the fringe of electricity supply in this country. We have also to consider, in the same context, the production of gas and by-products.
I have one further point to make. [HON. MEMBERS: "Oh."] Hon. Members may not like it but they have got to put up with it. This is the first time I have spoken in the House on coal in the last seven or eight years, but I recall the speeches made by the hon. Member for Kidderminster and the little good those speeches have done—a lot of carping criticism of the miners, with no contribution to the well-being of the mining industry, just a lot of silly blah-blah. That may do very well in Kidderminster. If that is what hon. Members opposite are after, it perhaps would be better if we heard less from the other side of the Committee than to go on talking as they do.
If we have a review of the fuel and power industries and a White Paper, let us have the whole story and see where we are. Let us see where the profits are derived and let the profits, from wherever they may be derived, be used for the benefit of the whole of the fuel and power industry, for the public and not for one part of the industry.
§ Colonel C. G. Lancaster (South Fylde)
Those of us who, some years ago, took part in the Committee stage of the Coal Industry Nationalisation Bill will welcome the change of heart by the right hon. Member for Easington (Mr. Shinwell) in the matter of obtaining information about the coal industry. I well remember that time after time on that occasion we pressed for more information, and I doubly welcome that at this time the right hon. Gentleman should have joined our ranks.
I want to return to what was said by the hon. Member for Cardiff, South-East (Mr. Callaghan), in the concluding stage of his speech. I do not altogether quarrel with him in his long-term view; I hope that the time will come when we 1576 can see the investment in the nationalised industries—coal, electricity and gas—in the wider context of the whole fuel outlook of this country, including oil and atomic energy, but I agree with my hon. Friend the Member for Heeley (Sir P. Roberts) that we have to go one stage at a time.
The hon. Member for Cardiff, South-East said there was a difference between the attitudes of some of my hon. Friends and myself towards the borrowing powers. I assure him that it is only one of degree and emphasis. I was by no means happy on the Second Reading of the Bill and I supported it with some reluctance. I was altogether unhappy about the new "Plan for Coal", for I did not think it compared in any way with the original plan, I thought it was a very loose bit of thinking, and I was hesitant that Parliament should vote this very large sum of money on such an imperfect piece of work.
Like almost everyone else in the Committee, however, I recognise that there must be a very large investment in this industry and I do not believe that any of us, certainly in all the discussions which have occurred recently about these borrowing powers, has wished either to curb the total amount, whether it be £1,000 million or the £350 million, which Parliament is asked to provide or to say that the Coal Board should spend £60 million or £100 million, or whatever it may be, in any one year.
Let us look, however, at the background to today's discussions. For 5½ years we had to follow the course of the first Plan for Coal, and although we saw it falling down, after the third year, there was little or no opportunity for the House to decide that it should be scrapped and a new plan put in its place. We had to go on year after year seeing very little return for this immense expenditure of money. It can hardly be a matter of surprise if when we come to the new "Plan for Coal" we are, naturally, somewhat sceptical.
My right hon. Friend this afternoon has gone a long way to allay some of our worries. He has told us that there are to be these various forms of accountability. They are not complete, I admit, but they go a considerable way along the road. The White Paper, if it turns out 1577 to be what I hope it will be, will afford to the House, if not every year, certainly on a number of occasions, not only an opportunity of seeing what has been accomplished, but an idea of what is envisaged in the ensuing period.
Here again, it would be a mistake for hon. Members, on either side, to assume there will be a desire to deny any part of the necessary investment. What we shall want to see generally is how the money is being laid out and what result is accruing from the investment. As the right hon. Member for Easington said, coal is not a precise industry; one cannot always guarantee that every investment will turn out right. I consider it a little less imprecise than the right hon. Gentleman indicated. I believe that we can go some considerable way towards accurate forecasting. Knowledge of geology and the general technique of mining are improving year by year. Although the industry is not completely precise, one should be able to get a good deal closer than the very general approach which has been made in the new "Plan for Coal".
What we want to see, and what I am sure even those who feel most strongly about the matter want to see, is that whether £60, £100 or £150 million has been expended or is contemplated, some result is coming from that expenditure. We do not want a similar situation to that which we have had in the past of very large expenditure, great parts of which have not fructified.
On Second Reading, I said that we should think again about the expenditure, if need be, on a geographical basis; that is to say, we should recognise that certain parts of the country no longer justify large investment and we should concentrate in certain areas where we can expect results. Fortunately, we have masses of coal in this country; there is no question of our running out of it for a hundred years or so.
What we lack at the moment is not good technicians—we have some of the best in the world—but the necessary numbers of technicians. That is our great problem. On that, I should like to say a word about the appointment of Mr. Collins to be in charge of this investment programme. I knew something of his work in the Ruhr shortly after the 1578 war and, no doubt, the right hon. Member for Easington is familiar with what he did in those days. Mr. Collins did a first-class job and I think that his new appointment is excellent. I am sure we all wish him well in this important task.
Reverting to the general position, my right hon. Friend has gone a considerable way to allay our doubts. A lot will be determined by the precise form in which he brings out the White Paper. We do not want it in meticulous detail, but we want it sufficiently clearly put before the House so that we can be satisfied that this money is being well spent. I am quite sure that if it is well spent there will never be an occasion on which anyone would wish to circumscribe the activities of the Coal Board—that is not our intention. Indeed, if the Coal Board is sensible, and does its job properly, it may get a good deal of credit from the way its schemes turn out. If it does well, I am sure it will get praise from the House. If it does badly, we shall have to look at these things again.
Let us on this occasion, however, assume that the Coal Board will get down to it and do a good job of work. If it does, there will be no harm in the White Paper; only good will come out of it. For that reason, I strongly support my right hon. Friend.
§ Mr. Hamilton
The hon. and gallant Member for South Fylde (Colonel Lancaster) is one of the more reasonable Members on the Government side and usually presents a constructive case which, whilst we may not agree with it, we are prepared to understand. What we on this side are worried about is the destructive effects of the arguments of hon. Members opposite and their general approach to nationalised industry.
I was not a Member of the House between 1945 and 1950 but one can quite understand that the Government of that time, in seeking to nationalise the coal industry, were bound to make what was in the nature of an experiment. All of us, on all sides, should recognise that and be prepared to make adjustments according to our experience. We on this side are prepared to do that, and we would support hon. Members opposite who were prepared to do it if they were doing so on a constructive basis. We are not convinced that the Minister has produced the 1579 Amendment on that basis. We on this side know, and the Press and whole nation know, that the right hon. Gentleman has simply succumbed to the yelping mongrels of the 1922 Committee.
It is not the first time that pressure has been brought to bear on Members of a Tory Government. The right hon. Gentleman's predecessor had a similar experience. I remember him coming to the Box and lauding the achievements of the nationalised Coal Board and getting into hot water with his hon. Friends for it. He had to go, and now I am not altogether sure that the right hon. Gentleman's tenure of office will be a very long one.
Let us, however, get down to what is, I hope, basically the reason for the Amendment—the question of public accountability. Anything that increases the public accountability of the nationalised industries will be welcomed on this side, but if hon. and right hon. Members opposite are to be consistent they must also insist on the maximum amount of public accountability for, for instance, the spending of farm subsidies.
When Lady Garbett, who was drawing farm subsidies, was evicted for misspending public money, the hue and cry came from hon. Members opposite because she was evicted for that reason. If the principle of public accountability applies to the Coal Board, it must apply also to the inefficient farmer, but we do not hear that from hon. Members opposite. I see, Sir Rhys, that you are about to rise to call me to order. I am on the extremely valid point of public accountability, on which the Minister has moved the Amendment to increase the power of the House over the finances of the Coal Board.
My right hon. Friend the Member for Easington (Mr. Shinwell) was quite right in saying that there can be no possibility of a high degree of accuracy in estimating the capital investment programme of the National Coal Board. The hon. and gallant Member for South Fylde said that there should be a more accurate assessment than in the past, but he gave no examples to show where the Board has been grossly inaccurate in its assessments.
I can give one example from my constituency which illustrates the difficulties 1580 under which the National Coal Board is labouring. In 1946, prior to nationalisation, the private coal industry in Fife cut the first sod of a coal pit. Only now, 10 years later, are we beginning to get a trickle of coal from it. The venture was not started by the National Coal Board, but by the privately-owned coal industry. Nine million pounds has already been spent on that pit, against an original estimate of £5 million, and we are still not getting more than a trickle of coal. That kind of thing is happening up and down the country. Because of that, the Board's programmes have to be reassessed as the years go by. The original Plan for Coal made that quite clear, just as this one does.
I am not quite sure that the White Paper which the right hon. Gentleman has promised the House will be of any value whatever if it is not viewed in the context of a national fuel policy. If it is going to be simply a critical examination of the National Coal Board, taken out of the context of a national fuel policy, it will be quite valueless. I have yet to be convinced by the right hon. Gentleman that he is introducing the Amendment for any other reason than that considerable pressure has been exerted upon him by the 1922 Committee, which is costing the nation dear in regard to the nationalised industries, Suez, Cyprus and other matters.
§ Mr. Aubrey Jones
Although the Amendment deals with the relatively narrow question whether or not we should insert a limiting period of five years in the Bill, the debate has ranged over a much wider field. I trust that I shall be forgiven if I confine myself mainly to the contents of the Amendment.
The hon. Member for Cardiff, South-East (Mr. Callaghan), the right hon. Member for Easington (Mr. Shinwell) and the hon. Member for Fife, West (Mr. Hamilton) all objected to the inclusion of the period of five years, but not one of them advanced a single reason why that period should not be included. They rested their objection upon a suspicion that the Amendment had been put down merely as an act of deference to some of my hon. Friends. I can assure them that I have a most respectable precedent for the inclusion of a five-year limit, and I am astonished that the right hon. Member for Easington should have forgotten it. I refer to the nationalisation Statute 1581 of 1946, Section 26 of which provided for advances to the total sum of £150 million for five years.
If it was proper to include such a period in that Statute, why is it improper to include it in the Bill? If it is suggested that it will cripple the Coal Board and subject it to uncertainty, why did not the inclusion of such a limit have the same effect then?
§ Mr. Shinwell
At the inception of nationalisation there was a great deal of uncertainty as to what would happen. As I pointed out in my speech from the Government Front Bench during the Second Reading debate, it was an experiment. We had no guarantee from mining engineers such as Sir Charles Reid or Mr. Eric Young, or any other eminent mining engineer, about how much coal we could produce. All we had to go by was the Reid Report. There was a great deal of uncertainty and speculation about the matter, and that is why the limit of five years was included. But experience should have taught the right hon. Gentleman that it is quite unwise to place a limit upon the period of capital investment.
§ Mr. Callaghan
Is the Minister going to answer the question? Why has he changed his mind between the Second Reading debate, when he asked us to give a Second Reading to a Bill which had a 10-year limit for borrowing, and the Committee stage, when he says that he wants a five-year limit?
§ Mr. Jones
As yet, hon. Members opposite have not given me much chance to reply to what they have said. The objection advanced by the hon. Member for Cardiff, South-East was that I was condemning the Coal Board to uncertainty. Let me once again quote the Board's application, as given on page 21 of "Investing in Coal". The fourth paragraph says:Under existing legislation the balance of the Board's borrowing powers was about £50 million at the end of 1955. The Board have therefore sought new powers.That is the purpose of the Bill.
1582They may require to borrow up to an additional £400 million in the next five years.Five years is the period of time in which the Board required the advance. How then, if I include a period of five years, do I condemn the Board to uncertainty? I am merely carrying out what the Board originally asked for.
The hon. Member for Cardiff, South-East asked why I do so now when I did not do so in the Bill originally. I would refer to what the right hon. Member for Easington said. He welcomed more discussion upon these matters. So do I. In my opening speech I explained that I welcomed more discussion, with the proviso that the Board, in its long-term investment plan, should not be condemned to uncertainty. Under the Act preceding this piece of legislation—the 1951 Act—the investment was intended to cover the extremely long period of 15 years, and it was couched in such language that it was not expected that the matter would ever again return to the House for discussion.
As my hon. and gallant Friend the Member for South Fylde (Colonel Lancaster) said, that Measure went too far to one extreme. By the insertion of the Amendment I am providing an opportunity for a review of the plan halfway through its life, but without condemning the Coal Board to uncertainty. I believe quite as strongly now as I did at the time of the Second Reading debate that one of the reasons for the present inadequate coal production is inadequate investment in the past, and that for too long the Coal Board has paid overmuch attention to immediate output, to the neglect of future output.
§ Mr. Jones
Indeed, with the help of the Amendment, because it will provide opportunities for fuller discussion and, I hope, for the House of Commons to be more informed upon matters which are of importance to it.
I now come to the White Paper, which is not strictly relevant to the Amendment, but complements it. The hon. Member for Cardiff, South-East was most dogmatic upon what the White Paper would or would not contain. All I ask him to do is to wait and see. I have had many suggestions about what should be included in it, and I shall pay close attention to them all. At this juncture, however, I should like to comment upon two points. More than one hon. Member asked whether or not the figures for investment in nuclear power would be included in the White Paper.
§ The Deputy-Chairman
I have been puzzled by the mention of the White Paper throughout the debate upon this Amendment. It cannot be in order in a discussion of the Amendment to consider what will be in the White Paper.
§ Mr. Callaghan
Will it be in order, Sir Rhys, to discuss it on the Question, That the Clause stand part of the Bill?
§ The Deputy-Chairman
I cannot imagine that a discussion on the White Paper is in order at all. No White Paper is mentioned in the Amendment.
§ Mr. Callaghan
This places us all in great difficulty. Hon. Members on this side of the Committee did not introduce the question of the White Paper; it was introduced by the Minister, and it has been referred to in the course of the debate by myself and several other hon. Members, following the Minister's proposition. May I submit that it is relevant in the sense that it is one of the reasons 1584 advanced by the Minister in his efforts to persuade the Committee to accept the Amendment? Is he regards it as relevant to that extent, hon. Members on this side of the Committee would like to hear details of the matters which the Minister intends to include in it
§ The Deputy-Chairman
I do not know how the subject of White Paper was introduced at all at the beginning of the debate. But this Amendment has nothing to do with a White Paper, the contents of which we have not seen.
§ Mr. Shinwell
Further to that point of order, Sir Rhys. When the Minister set forth his proposals contained in the Amendment, and in the subsequent discussion, it was obvious that we were considering not merely the period of capital investment and the amount, but the need for a review of the whole situation. That was obviously the context in which we were discussing any period of investment and the amount; and how is it possible to isolate one from the other?
§ The Deputy-Chairman
I understand the reference to the White Paper, but now we are going a great deal beyond that. Now we are proposing to discuss what the White Paper should contain, and that has nothing to do with this Amendment.
§ Viscount Hinchingbrooke
Further to that point of order, Sir Rhys. Your predecessor in the Chair allowed my right hon. Friend a good deal of latitude in his opening statement to say exactly why he was introducing a White Paper and what it would contain; and the subsequent debate, for the last two hours, has been on the White Paper. It is most relevant to the decision whether or not this Amendment should be accepted.
§ The Deputy-Chairman
I understand that there was certain latitude allowed, but I have been puzzled by the nature of this debate on the Amendment, because a White Paper which no one has seen cannot be relevant to an Amendment to this Clause. The question of going a step further and discussing what the White Paper shall contain certainly does not arise on this Amendment.
§ Mr. Jones
I am sorry if I was out of order. I merely represented the White Paper as being complementary to this 1585 Amendment for the insertion of five years into the Bill. All I will say on the question of the White Paper is that I will give close attention to the suggestions which have been made and will endeavour to make the White Paper as comprehensive and informative as possible, compatible with my statutory responsibilities.
§ Mr. Jones
—and a Royal Commission is due. With respect, I think that it would be desirable to complete the discussion on this Amendment before that happens.
If I may revert to the Amendment, it was suggested by the right hon. Member for Easington that this represented a reduction in the total sum, but there is no reduction at all. My hon. Friend the Member for Kidderminster (Mr. Nabarro) asked how it was that the Coal Board expected to be self-financing after five years. I will give the answer to that question which I gave during the Second Reading debate. Investment is heaviest in the earlier years. After that it declines, and at the same time, in the later years, depreciation provisions will accrue from heavier past investment. Therefore, the Coal Board expects to be self-financing in five years' time.
My hon. Friend repeated the question which he put during the Second Reading debate—on what principles of price and depreciation was this estimate based? If, inadvertently, I omitted to answer his question during the Second Reading debate, I am sorry. The omission was inadvertent because the answer, as it framed itself in my mind, was in two phases, and I jumped to the second phase because I assumed that he was knowledgeable about the first.
Surely the answer is that it is expected that over the next five years the Board will break even, that there will be no deficit. That is in the passage on page 21 of the document "Investing in Coal" from which I quoted. It is assumed that depreciation will still be related to past historical costs, and that is a natural assumption. During the debate on Second Reading I explained that if changes were made in the basis of depreciation, and if 1586 depreciation henceforth was related to current costs rather than past costs, a change which I did not exclude, that change should be made for all nationalised industries in general. In the case of coal it would mean that the Board would be self-financing before the expiry of five years.
§ Mr. Nabarro
My right hon. Friend is answering a question which I put to him, and I am grateful to him for doing so.
I recognise that the depreciation provisions which affect the borrowing powers of the Board are a very complex matter which we cannot deal with by debate in this Committee. Would my right hon. Friend undertake to ask the Chairman of the National Coal Board to enlarge, in the next Report and Accounts, on what has been done in the past on the matter of depreciation provisions, all of which would be of considerable educational value to hon. Members of this Committee?
§ Mr. Palmer
May I ask, Sir Rhys, whether it is in order—it is against the normal usage in Committee discussions—for the right hon. Gentleman to refuse to give way to an hon. Member on the opposite side of the Committee—and the Opposition have some precedence in these matters—while, apparently, giving unlimited time to his own supporters to interrupt him?
§ The Deputy-Chairman
That is not a point of order for me. It is for whoever is in possession of the Floor to decide whether or not to give way.
§ Mr. Jones
I think that I have been liberal in giving way to hon. Gentlemen on both sides of the Committee.
If this Amendment is accepted, the Bill will provide for advances to the extent of £350 million over a period of five years. That is what the Coal Board asks for, and since this provision corresponds with its request, it would follow that the plans of the Board are not subjected to any uncertainty.
§ Mr. John McKay (Wallsend)
On a point of order, Sir Rhys. When several hon. Members are standing and trying to catch your eye, is it in order for an hon. Member to be called a second time before other hon. Members have had a chance to speak?
§ The Deputy-Chairman
It is perfectly in order. I did not see the hon. Member for Wallsend (Mr. McKay).
§ Mr. Palmer
I wish to take up a point which seems to have been overlooked by the Minister in his hurry to bring the discussion to a conclusion, although there is plenty of time. I know that, relatively speaking—I say this with respect—the right hon. Gentleman has had a short experience as a Minister. But he must understand that his own supporters—or alleged supporters—have taken up a tremendous amount of time, and therefore many hon. Members on this side of the Committee who desire to put forward one or two points have not had the opportunities which they deserve.
The Minister said that we should get relevant details of nuclear energy development because that would come under the Central Electricity Authority. But the Atomic Energy Authority is also carrying on development on its own account, and it would be most interesting to know if the investment plans of the Atomic Energy Authority affecting the electric power will be contained in the White Paper when it appears, because the figures are relevant. As the right hon. Gentleman knows, the Calder Hall station is not a power station of the Central Electricity Authority.
§ 5.30 p.m.
§ Mr. Iorwerth Thomas (Rhondda, West)
Bearing in mind your Ruling, Sir Rhys, regarding the scope of the debate, I am wondering whether I shall be deprived of the opportunity of dispelling an illusion which seems still to be hovering in the minds of certain hon. Gentlemen opposite. The demand for restriction and curbing, and for putting the National Coal Board's finances into a strait jacket is motivated, so they tell us, with the best of intentions. The whole basis—