§ Mr. A. E. Oram (East Ham, South)I beg to move, in page 17, line 16, to leave out "either".
§ The Temporary ChairmanI think tha this Amendment should be discussed with 1051 the next Amendment in the hon. Gentleman's name, in page 17, line 16, to leave out from "generally" to "that".
§ Mr. OramThe purpose of these two Amendments is to prevent discrimination by suppliers against any particular person or class of persons. The class of persons whom I have specially in mind are co-operative societies, which have suffered for a great number of years from a great variety of discriminations merely because they are co-operative societies and trade in a particular way. A number of my hon. Friends and myself have tabled an Amendment to be moved at a later stage of the Bill dealing specifically with the co-operative practice of offering a deferred rebate or dividend. I do not wish at this stage to anticipate the arguments on that matter, which can be more conveniently and appropriately done later.
§ Mr. P. ThorneycroftI agree that we should not debate the point about co-operative societies on this Amendment. A later Amendment will give us that opportunity. The purpose of the words in the Bill which we are now discussing can be put very simply. Normally when a contract of sale is made or arrangements for sale are made, the various retail margins at the different stages are laid down. The words here simply make it clear that the provision applies either generally or to a specified class of person and allows wholesale and retail margins to be laid down by the individual. That is all that happens. It is quite clearly ordinary commercial practice, and it is just that we should recognise it in the Clause.
§ Mr. OramIn view of the right hon. Gentleman's explanation, I beg to ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
§ Mr. J. E. S. Simon (Middlesbrough, West)I beg to move, in page 17. line 18, after "supplier", to insert:
or by any person adversely affected by a breach of this condition".
§ The Temporary ChairmanI suggest that with this Amendment the Committee should also discuss the Amendment in page 17, line 20, at the end to insert:
Provided that the condition shall not be enforceable by a person other than the supplier unless such person has acquired similar goods subject to a similar condition.1052 and also the Amendment in page 17, line 20, at the end to insert:(2) Where goods are sold by a supplier to more than one person subject to the same condition as to the price at which those goods may be resold and one of the persons or a person who subsequently acquires the goods with notice of the condition in such circumstances that the condition may be enforced on him as provided by the preceding subsection is aggrieved by the omission of the supplier to enforce the condition on another person who has acquired goods from that supplier in such circumstances may require the supplier to enforce the condition on such other person.and the Amendment in page 17, line 20, at the end to insert:(2) Where goods are sold by a supplier subject to conditions as to the price at which they may be resold, such conditions shall be deemed to be imposed for the benefit of all persons dealing by way of trade in such goods or similar goods or similar classes of goods which are subject to conditions to the like effect whether imposed by the same or another supplier and shall be enforceable by such persons against any other person who acquires the goods by way of trade with notice of the conditions. as if the obligation to observe the said conditions were contained in a contract made between the parties.The same principle is involved.
§ Mr. SimonClause 20 is concerned with individual resale price maintenance and therefore with the manufacturer's rights to take action himself against the loss-leader. Many of my hon. Friends and myself think that the argument for the loss-leader is exaggerated. On the other hand, one must concede that the Lloyd Jacob Report came down in favour of individual resale price maintenance.
It said, in paragraph 83:
It is, we have found, generally agreed that selective price-cutting and the use of well-known proprietary articles as loss-leaders have in the past had many undesirable results…In the next paragraph the Committee said:The disruption of trade… brought about by these activities appear to bear particularly heavily on the retailer who, by carrying in addition a wide range of relatively slow selling lines and in some trades by offering skilled technical advice to his customers, provides a service whose value may not be recognised until it has disappeared.Therefore, although I have some misgivings, I would not be prepared to dissent from the general proposals in Clause 20.The question arises who is to enforce the right—who is really injured. The Clause itself gives the supplier of the 1053 goods the right to intervene in his contract, to follow it up and enforce it irrespective of into whose hands the goods have got, and even though the defendant before the Court is a stranger to the contract. That, to some extent, is a new principle in our law, but it is what the Lloyd Jacob Committee recommended. If one is to legislate against the loss-leader it seems a reasonable way of doing it. But it is not only the supplier who is injured. He may find his retail outlets disorganised, and therefore he should have the right to take action under the Clause; but the person who is most immediately injured is the rival retailer. He may find that suddenly there is a line of branded goods put into the shop round the corner that can act as a loss-leader, and by the time he can intervene with his wholesaler and the wholesaler has taken the matter up with the supplier, the damage is done.
Therefore, if there is a case to allow strangers to intervene under the contract to prevent the loss-leader, that is, the undesirable selling of proprietary goods at below the stipulated price, it should inure for the benefit not only of the supplier but even more for the benefit of the rival retailer. The Amendment is designed to remedy that defect in the Bill. It allows anybody who is adversely affected by the breach of the condition to intervene, provided that he has acquired similar goods subject to a similar condition.
I suggest that this is a completely reasonable provision designed for the protection of the person who is most likely to be injured, and that it should certainly recommend itself further to many hon. Members on both sides of the Committee, in that it may be the small retailer who will need the protection.
5.30 p.m.
There is a second reason why I suggest that this Amendment should commend itself to the Committee. That is, that if a rival retailer is allowed to intervene in the contract, it avoids what might otherwise happen, which would mean bringing back the trade association by the back door. It might well be that if we deny this protection to the rival retailer, it may be found that the only protection against the loss-leader is the use of the trade association.
1054 I have heard it argued that the proposal in the Amendment is an innovation in the law and for that reason should be discouraged.
§ Mr. Leslie Hale (Oldham, West)Hear, hear.
§ Mr. SimonI hope that the hon. Member for Oldham, West (Mr. Hale), who has very free-ranging ideas in these matters, is not assenting to that as a desirable argument.
In point of fact, the problem before the Court under this Amendment is exactly the same as the one that will arise under the Clause as it stands. The only difference will be who is to be the plaintiff. Instead of being the supplier, it will be the rival retailer, or anyone who has bought the goods subject to the condition, who can show himself to be injured. But the same question arises under the Clause as it stands, namely, has the defendant who has bought subject to a condition as to price broken that condition?
§ Mr. HaleWith respect, I do not agree with the hon. and learned Gentleman's first proposition that the Clause, as amended, provides any innovation in the law, because the attachment of covenants to property and passing them on to a purchaser has been known to the law for a thousand years. But it is an innovation to say that somebody to whom one owes no duty, of whose circumstances one does not know, who merely claims to be carrying on a similar type of business in a similar district, possibly some distance away, has been caused damage because one is selling goods purchased on a third-party basis at a penny a pound less. Where is the principle of our law that applies to that case?
§ Mr. SimonI am much obliged to the hon. Gentleman.
There are close analogies in our law to what we propose in this Amendment. The hon. Gentleman asks where is the duty? With great respect, he is thinking too much in terms of our present law of contract. This Clause allows a stranger to intervene in the contract. It allows a supplier, even though he has no direct contract with the retailer, to intervene in it, even though under our existing law he is owed no duty. All we seek to do is to allow the rival retailer, who is equally or more injured, to have the same remedies.
1055 There are provisions in our law which are close to this, such as those in regard to a building estate, about which the hon. and learned Gentleman knows much more than I do. Where a building estate is sold off into plots of land, the people who own plots can intervene against any one breaking a restrictive covenant which is similar to one that they have bound themselves to observe. If the owner of the land sells off his land in building plots, each of which is subject to a restrictive covenant, and the neighbour who has bought a plot of land similar to one's own and subject to a similar covenant breaks that covenant, one can intervene and get an injunction to stop him from doing so.
That is a close and exact analogy to what is provided for under the Amendment. There are other analogies in the law of strangers intervening, but the one I have given as an example is so close, and the grounds for it are so closely allied to those which have animated my hon. Friends and myself in putting down this Amendment, that there is no need to elaborate the point further. The law implies an understanding that all people who bought subject to similar considerations will play fairly with one another. It is because the Amendment seeks to give legislative enshrinement to the principle of fair play and fair dealing in trade that I unhesitatingly commend it to the Committee.
§ Sir L. Ungoed-ThomasI hope that the President of the Board of Trade will not accept the Amendment. We approach the Clause with considerable misgiving, but at any rate there is a clear distinction between the Clause and the kind of case put by the hon. and learned Member for Middlesbrough, West (Mr. Simon).
There is at any rate a feasible case that where an individual owner has goods, it might not be so unreasonable that he should state the conditions which should attach to the goods which he manufactures. That is a typical case. But there is all the difference in the world between a proposal of that kind and a proposal that people who have no hand in the making of the goods, no interest in the goods, no connection with the supplier of the goods, a person to whom, as my hon. Friend the Member for Oldham, West (Mr. Hale) has pointed out, no duty is 1056 owed in respect of the goods, should be able to enforce the condition applying to those goods.
§ Mr. SimonWill the hon. and learned Gentleman show in what way that differs from the case of adjoining buyers of land on a building estate?
§ Sir L. Ungoed-ThomasI am coming to that. There is all the difference in the world between that case and this one, and we shall deal with it in due course.
There is a clear distinction between the manufacturer and the supplier of his own goods who can lay down conditions about them and make conditions enforceable by the Court. I am sure that the hon. and learned Gentleman recognises the demarcation?
§ Mr. SimonIf the hon. and learned Gentleman asks me, that element is common to both cases. That element is equally common to the case I quoted, namely, that the manufacturer makes his conditions and they run with the goods. The only question is who can enforce them?
§ Sir L. Ungoed-ThomasYes, but, of course, that is the whole substance of the case. With his knowledge of the law and rights and duties, and the right of resorting to the court which arises from them, surely the hon. and learned Gentleman is not suggesting that there is no point of legal substance in his Amendment.
§ Sir L. Ungoed-ThomasOf course not. Then we are agreed so far.
There is all the difference in the world between the case of a supplier of goods, the conditions applying to the goods and his being given a right of enforcement in respect of those goods, and the case put forward by the hon. and learned Gentleman, that of another retailer or wholesaler or somebody else who has no connection at all with the goods.
§ Mr. SimonI really cannot allow the hon. and learned Gentleman to say that. If he will look at the second of the Amendments which we are considering he will see that it says:
… the condition shall not be enforceable by a person other than the supplier unless such person has acquired similar goods subject to a similar condition.
§ Sir L. Ungoed-ThomasYes, it is "similar goods subject to a similar condition"; but what is the width of that? Is the person who obtains aspirin to be allowed to enforce conditions?
§ Sir L. Ungoed-ThomasThe hon. and learned Gentleman replies "yes". Then there is no case at all except the ordinary case of collective enforcement, and that is the whole substance of the approach to the Clause.
Let us take the case of a building estate which the hon. and learned Gentleman mentioned. That is entirely different from this matter. In the first place, the covenants in respect of building estates are linked with restrictive covenants affecting the land, a very old and ancient anomaly in our law. Secondly—this is the important point which differentiates it from the purposes which the hon. and learned Gentleman has in view—it is done because it is considered that all the persons in the building estate are affected by it. The covenant is entered into for the benefit of all the members of the estate. Therefore, one has there a nexus of common interest, common obligation, etc., interpreted by the law, which is entirely different from the case that we have here.
The real justification for the case put forward in the Amendment—it is not a justification with which I should agree—is that anyone who is affected should be allowed to enforce the condition. That is really the same justification as there is for collective enforcement; namely, that anybody who is affected by a breach of condition should be entitled to go to the Court and say that he wishes to enforce the condition. That is entirely different from the principle of Clause 20, which is that the person who supplies the goods should have the right to enforce the condition.
In our view, the Amendment opens up a wide resort to enforcement of restrictive practices and would lead to a kind of collective interest in enforcing restrictive practices which is entirely contrary to the principle of Clause 20, and one to which my hon. Friends and I take exception.
§ 5.45 p.m.
§ Sir J. HutchisonWe have listened to the legal dialectics of two hon. and learned Members. I am not learned in the law and, consequently, I cannot follow on that tack.
I would say to the hon. and learned Member for Leicester, North-East (Sir L. Ungoed-Thomas) that I should have thought that a retailer or wholesaler, or indeed anyone who handles goods, had an interest in the goods and that it would not be just the manufacturer or the processor. The whole complex of selling, handling and moving an article is as important as the processing of it. Unlegal as I am, if I may coin a word, I was not much impressed by the argument.
§ Sir L. Ungoed-ThomasI do not want to be at cross-purposes with the hon. Member. I do not know whether or not he appreciates that this would allow a competing retailer to enforce the obligation—someone who has not had any of the goods.
§ Sir J. HutchisonSurely it would only allow a competing retailer handling the same goods under the same conditions to enforce the obligation. At any rate. that is what is intended by the Amendment.
Perhaps I may return to the economic and equity side of the argument and for the moment leave the purely legal side. It is generally accepted that the great bulk of British business is in the hands of small men. Probably in numbers the employees in this country are still dominated by those employed by small manufacturers, small wholesalers and small retailers.
The man about whom I am concerned is the retailer who has bought his goods under certain conditions or undertaken to sell them under certain conditions, and has a competitor who is extremely important and influential and breaks those conditions, thereby damaging the smaller man. If the supplier of the goods takes no action in the matter, the small man may be permanently injured, and may easily be put out of business. That is a highly undesirable state of affairs. These small men should not be put in the position of having the dice cast against them. The purpose of the Amendment is to ensure that some recourse should be available to the small retailers.
1059 It would, I think, be accepted as a general principle that, the same goods being handled and the conditions being the same, it is only fair that the same prices should apply, and if one of the retailers breaks the conditions, another retailer who has accepted to sell the goods on the same conditions should be able to have the original conditions enforced.
I want to repeat a question which was asked by the hon. Member for Orkney and Shetland (Mr. Grimond). I am not clear what the President of the Board of Trade's reply would be. The hon. Member asked whether an association whose agreement had been approved would be entitled to enforce individual price maintenance on behalf of a member. If the answer is "Yes" I think the whole of the circumstances alter. I should be most interested to hear the President's reply.
§ Mr. Donald Wade (Huddersfield, West)I should also be interested to hear the President's reply to the question just posed by the hon. Member for Glasgow, Scotstoun (Sir J. Hutchison).
I have grave doubts whether it would be advisable to adopt the procedure laid down in Clause 20. The discussion on the Amendment has indicated some of the difficulties that may arise once we introduce that kind of procedure. Assuming that this procedure is adopted, I can see that there is something to be said for the case put forward by the hon. and learned Member for Middlesbrough, West (Mr. Simon).
I should not like to press too far the analogy with land. In the case of the building estate, the assumption is that the owner of a certain plot of land who wishes to enforce a restrictive agreement has taken the plot on the understanding that one of the benefits running with the land is the right to enforce restrictions upon the owners of other plots of land. I am very doubtful whether that is implied or written into contracts relating to goods.
The general question, however, I approach in this way. On an earlier Clause, I tabled an Amendment, which was not called, the purport of which was to ensure that parties who felt aggrieved by restrictive arrangements would have a right to appear before the Restrictive Practices Court to state their 1060 case. If one accepts the general principle, I would think that there should also be procedure whereby a retailer who fears the effect of loss-leaders—the main fear in the mind of the retailer, which accounts for his support for the policy of price maintenance, is the potential effect on him of loss-leaders—can bring his complaint before a court, although I should have thought that under some contracts, at any rate, he would have the right to complain to and proceed against the common supplier.
On the Amendment, however, I do not feel happy about the wording
by any person adversely affected by a breach of this condition".This goes too far. It is not so much on the principle but rather on the wording that I do not feel able to support the Amendment.
Dr. JohnsonI support the Amendments as a consequence of my interest in the book trade. Our anxiety is that which has been already expressed concerning the small retailer and the small bookseller. Perhaps I may be excused for giving a resume of our position. We have our net book agreement, which we hope would be approved under the arrangements in Clause 16, paragraph (b). Next, we come to the question of enforcement of the agreement, which hitherto has been enforced by the procedure of collective price maintenance.
Under Clause 19, however, the President of the Board of Trade would take the agreement, so to speak, to the dentist, who, first, would yank out the upper teeth under subsection (1) and then the lower teeth under subsection (2). Now, we come to Clause 20, which is, so to speak, the orthodontic department. I would not be so unkind as to say that false teeth are being inserted, but what is being inserted is only an upper set and not a lower set. The supplier—in our case the publisher—has his remedy, but the bookseller or retailer is left with no remedy whatever other than the rather uncertain one of a complaint to his supplier.
The anxiety in the book trade is increased by the realisation that it is not necessarily in the immediate interests of a publisher to maintain his prices. There might be either the large rogue publisher, who can defy anyone and do as he likes within the trade; or, on the other hand, 1061 there is the danger of the small publisher with a heavy depreciating stock—and nothing depreciates more quickly than a book after publication—who is in a somewhat desperate financial position.
Both of those people have a temptation not to maintain their prices but, on the other hand, to let their prices go, with the large publisher selling the best seller as a loss-leader and the small publisher selling off stocks of what might be quite attractive and good books and which could very well be picked up by a department store for its book department and sold in a similar manner to the loss-leader. That is the main fear of the trade.
Books as a loss-leader are a particularly suitable commodity for the large department store. The type of book which is suitable for the loss-leader—the best seller, of course, such as "The Cruel Sea" and books of that character—is just the thing which under the modern conditions of trade is essentially the small bookseller's bread and butter. He relies upon them to keep him afloat and to maintain his slow moving stock and to enable him to give to the public the service that is expected of him.
It is a fallacy to think that if this system of loss-leaders, and so on, develops, books will be cheaper in the long run. The danger that faces the trade. if this develops, is that, with the loss of that type of business, the small retailer will go out of business. There would be a closing down of markets and the publisher, in turn, would have a narrower market and smaller editions for his books. As a consequence, the price of books would not go down, but would definitely go up.
For the benefit of hon. Members opposite, I should like to read a quotation from The New Statesman and Nationof 14th April this year, giving conclusions concerning the book trade:
Under price-cutting conditions best-sellers might sell even better than at present, but if the general level of sales in Britain of the 250,000 titles in print were depressed, it would have an immediate effect on book sales abroad. These are running at about £17 million a year. Falling home sales would involve higher prices for books, and as books are Britain's biggest cultural export, the loss of price stability might have far wider repercussions than purely commercial ones.1062 I have said that our market hitherto has been kept up by the operation of collective price maintenance. I agree with my hon. Friend the Member for Heston and Isleworth (Mr. R. Harris), who regretted that no exceptions are possible to the prohibition under the Bill. We cone, however, to the question of individual enforcement. Obviously, in the circumstances as we visualise them in the book trade, this will be a capricious matter. On the one hand, these conditions may work; on the other hand, they may not work—we do not know. If they do not work, it will be the small retailer and the small manufacturer or publisher who suffers in consequence.Looking at the position of the small retailer—looking for the moment at a wider sphere than book publishing and considering, say, motor traders, chemists. and so on—there is only one remedy for the small retailer under the Bill in its present form. That is under Clause 19 (3), under which he or several other small retailers may get together and form an inter-connected body corporate and so protect themselves in this way. In other words, they would be forming a trust or monopoly.
We have surely to remind ourselves that this is an anti-monopoly Bill. I am sure that it is not the intention either of my right hon. Friend the President of the Board of Trade or of hon. Members, on either side, that small retailers should go out of business or even that fresh monopolies should be born, the effect of which obviously would not be to lower prices, but eventually to close down on the consumer and to raise prices. For these reasons, I hope that my right hon. Friend will favourably consider the Amendments.
§ 6.0 p.m.
§ Mr. P. ThorneycroftThis Clause gives to the suppliers a right which they have never had before, a right to enforce in the courts the prices which they wish to have maintained in each particular case not only against the people with whom they are in privity of contract, but beyond. This Amendment would allow one trader to instigate legal proceedings against a competitor for indulging in price competition. I do not propose to enter into a debate with my hon. and learned Friend the Member for Middlesbrough, West (Mr. Simon) about the 1063 analogy of the law of real property, but I do say that this would be a startling innovation in the English legal system.
There have been some criticisms that the new legal right of suppliers goes too far and gives a force to resale price maintenance which should not be there. I have defended it and will, if necessary, do so again. But whatever we think about that this Amendment goes much wider and further. In my view, and in the view of the Government this raises quite a different issue from the one we are now considering. The issue we are here considering and the issue which has been discussed, debated and analysed in one quarter after another, is whether or not the manufacturer should be able to carry the price of his goods beyond the wholesale stage to the retail stage and see at the retail outlet that it is sold at a level price.
After great argument and debate the Lloyd Jacob Committee came down on the side of saying that it should be allowed. The Committee made some reservations about which we may hear later, but at any rate there is evidence, and a basis on which the case may well be sustained, that the manufacturer should have that right for his own goods. The Lloyd Jacob Report states specifically that the manufacturer should not do it for someone else's goods.
In that Report, it was not even suggested that the individual retailer should start suing. After all, when the manufacturer does it, he acts with a special sense of responsibility. He exercises some flexibility in his judgment about these matters. But were we once to introduce into the English legal system a right whereby any individual retailer could sue any other retailer selling the same sort of goods from the same supplier, it would apply in every case. The moment there was any sign of price cutting there would be an action before the court, and I do not know where we would end with an arrangement of that kind.
I appreciate that in these complex matters there is force in the argument on all sides and, in particular, in the one about the loss-leader. The loss-leader hits the manufacturer and that is the danger. The loss-leader was the main 1064 argument which impelled the Lloyd Jacob Report and other reports to come down in favour of individual resale price maintenance. That is the argument which led them to the conclusion that it is wrong to suppose that the manufacturer will be indifferent to the matter.
It is in the interests of the manufacturer to see that his distributive system is not disrupted. He depends on the good will of the retailers in matters of this kind. He will not discriminate between one retailer and another, and lose a useful and valuable retail outlet, and a carefully constructed distribution organisation, by treating one retailer in a way which is manifestly and harshly unfair compared with his treatment of other retailers.
It is true that in some other countries an arrangement of this kind—I will not say has been introduced—has been attempted; I will not say more than that. As some hon. Members know, in the United States arrangements of this kind have not worked very satisfactorily. This system of cross actions by retailers is not one which could be fitted easily into any legal system and in some countries, like Canada and Sweden, the whole system of individual price maintenance has been taken away altogether. The argument may well be advanced that this should be done. I do not advance that argument. But I say that to introduce into this Bill an arrangement which gives the right not only to the supplier or manufacturer—who has a real, substantive interest in the matter and whose right has been formally made out in two massive Reports on the subject—but also to the retailer, is carrying this Bill and this Clause far beyond the present intention.
My hon. Friend the Member for Carlisle (Dr. D. Johnson) mentioned the net book agreement. I fully appreciate the interest of hon. Members in an arrangement of this kind. May I say at once that this Bill does not outlaw the net book agreement. That needs to be said, because there is some misapprehension about all these things. To start with, every publisher will be as free tomorrow as he is today to say at what price his books should be sold and what margin should be held at the retail stage, and so forth. If he wishes to agree with other publishers to maintain prices, he is free 1065 to come to a mutual arrangement of that kind, to register that agreement and, in due course, to have it considered and discussed before the Court. I have no doubt that a fair hearing will be given to the arguments and that, if it is proved, the agreement will stand. All that will change will be that individual manufacturers will have to take their own actions in the matter.
I do not accept the view that individual manufacturers or publishers do not take action on these matters. To contend that is merely to contend against the case for resale price maintenance. After all, if there is an interest in these matters people will have an interest to see that they are, in fact, carried out; and in my judgment that new right is far more convenient and at any rate far less open to public criticism than the massive arrangement of private courts, and stop lists and the rest of it. If there is a clear case of loss-leading I have no doubt that the rights we give in Clause 20 will be used.
I have sympathy with the arguments which have been addressed to me in this matter. In particular, I wanted the opportunity to answer my hon. Friend the Member for Carlisle. We do not outlaw the net book agreement by these arrangements, but I hope very much that the Committee will not press me on these Amendments, which would introduce a manifestly new principle into English law.
§ Mr. HaleI wish briefly to reply to the two or three observations which have been directed towards me. I apologise to the hon. Member for Carlisle (Dr. D. Johnson) for not realising at what point his upper and lower dentures were mixed in the book publishers' bread and butter; and, therefore, if for once I do not follow him, he will understand why. I am always interested to hear about books, and perhaps on some other occasion we might even have further discussion on this matter. If the hon. Member will arrange with Rolls-Royce to provide cars to convey the publishers to the Mayfair Hotel, I will arrange for a supply of boots and shoes from the co-operative society for the authors so that they may walk up from Shoreditch, and then we can have a further discussion upon the interlocking problems of the book industry.
The hon. and learned Member for Middlesbrough, West (Mr. Simon) produced a fantastic analogy in support of 1066 his proposition that there was some legal system in this from the old law relating to building estates, where, of course, each participant was regarded, so to speak, as having the interest of a club member in the welfare of the estate. That was desirable, but it was found to be too rigid and was repealed. In the Law of Property Act it no longer exists, to the extent that any person who considers that he has a special case can apply. But, on the whole, it was not the hon. and learned Member's happiest example of policy.
I was cheered to hear my hon. and learned Friend the Member for Leicester, North-East (Sir L. Ungoed-Thomas) take the view which he did. I was rather afraid that I might have spoken out of turn in expressing a proposition which my emotions prompted me to express, but which was not about to be accepted by the party to which I belong, and which would have placed me in a somewhat difficult situation. I am fortified now to know that that is not so.
If we look at the Clause we see that what is suggested is the most fantastic example of the encouragement of litigation that has ever been put before the Committee. This does not apply to the next-door neighbour. Speaking in parenthesis, Sir Rhys—first, because I may be out of order, and, secondly, because my party might not approve—I do not much like Clause 20 at all. I find some real difficulties about it. In the Amendment we are dealing with a man who buys a retail shop to stock with goods. Suppose he does not like the goods. Suppose he is a chemist who does not like Mother Siegel's Syrup and says, "I want to put in something which I think is better ". Suppose he knows of some other health salts which someone says will produce something two hours more quickly. Why should he not do so? I do not know.
Directing myself to the exact terms of the Amendment, I would point out that when Sir Henry Hawkins was making a fortune out of railway compensation cases it was suggested that there was a special case for the chemist to have adequate compensation because he was not in an attractive part of the town. He ridiculed that by saying that he could imagine a man passing a nice little "pub" and saying to his friend, "Here is a nice little place. Let us pop in and have a quick one," but no one passing a chemist's shop would say, "Let us pop in and have half 1067 a truss." It is not the man next door against whom he can apply for an injunction. The competitor concerned may be ten miles away.
§ Mr. SimonDoes the hon. Member think that is a likely contingency, that a man ten miles away would be adversely affected?
§ Mr. HaleThat is precisely what does happen. It has been suggested that the bulk of the business is in the hands of the little man. That may be true, but the little man is in the hands of the big man. A firm of multiple chemists would obviously be interested in this.
I depart from Sydenham Hill every morning and return there every night—well, most nights—but I am not the only person who does so. About 1,000 other people do so. I can imagine a man at Sydenham Hill saying, "A shop at Victoria Station is starting undercutting" and all those people, before returning to Sydenham, would buy their books at Victoria. What is to stop them doing so?
§ Mr. SimonIf the hon. Member is asking me, what would stop such a happening is that the retailer concerned would have to prove that he was adversely affected; and he could not possibly prove it in a case like that.
§ Mr. HaleThe hon. and learned Member should really face the consequences of his Amendment. The retailer concerned does not have to prove anything to start with, but has to apply for an injunction. I used to observe that nearly all my clients came to me on a Monday morning when they had had a day of prayer and a day of anxiety the day before. These are worrying matters. Why should the retailer be faced with this?
The hon. Member for Huddersfield, West (Mr. Wade) put a point which has not been answered. If a retailer thinks that he is being affected, what does he have to do? He has to ring up the manufacturer and say, "This is your business. Are you going to stop him, the other retailer, or are you not?" The manufacturer either says, "Yes, I shall proceed under Clause 20"—if we pass the Clause, and I hope we shall not do so—or he says, "This is so small a matter that I am not interested." If it is so small a matter that the wholesaler is not interested, why 1068 should we be interested? Hon. Members are introducing an Amendment which would complicate the position for most retailers and place them in difficulties without limit, geographical or otherwise.
§ 6.15 p.m.
§ Mr. Gresham CookeI think we must pay some attention to the fears of retailers under this Clause. In the Clause the Government have accepted the principle of resale price maintenance, but in my submission they have not really paid attention to all the fears which retailers are expressing.
There are three classes of fears which retailers have. One is that they might be selling the goods of a very weak manufacturer who would not be likely to bring an action against a big distributor. That would be a usual case. In another case the manufacturer may not care to maintain his price and in a third case there may be two retailers in one town—
§ Mr. Roy Jenkins (Birmingham, Stechford)Is the hon. Member now suggesting that the manufacturer who does not wish to maintain his price—that was his phrase—should be forced to do so?
§ Mr. Gresham CookeI am not suggesting that, but I wish to bring forward a suggestion.
Suppose two retailers in a town are selling somewhat similar goods. If one retailer begins vigorously to slash his prices what remedy has the other retailer got? The only remedy he has under the Clause is to go back to his manufacturer and ask him to speak politely to the other manufacturer and get that manufacturer to try to persuade the other retailer to maintain his price. That is a very real fear on the part of retailers.
§ Mr. W. T. Williams (Barons Court)If the manufacturer does not want to maintain his price, as the law stands, or even if the Amendment were passed, the aggrieved retailer would have no remedy in those circumstances, anyway.
§ Mr. Gresham CookeI am saying that it is a very cumbersome and roundabout way of dealing with the question rather than having a direct action as between one retailer and another. Although this may be somewhat of an innovation in British law, there is nothing very startling 1069 about it in the Western world. This Clause is based on the American practice. In the debate last July, the Attorney-General said:
If we can find methods of enforcement which are effective without collective boycott and private courts, then, of course, it would follow that it would be possible to prohibit such methods, maybe by adopting some of the ' non-signer ' arrangements which are current in other countries."—[OFFICIAL REPORT, 13th July, 1955; Vol. 543, c. 2060–1.]This Clause is a "non-signer" Clause based on legislation which has been accepted in 45 American States. Even as recently as 1951 and 1952, when there was some disastrous price cutting going on between retailers in America, the Maguire Act was passed to overcome the defects of enforced resale price maintenance in industry and commerce. Recently, in New York, actions have been brought by retailers against other retailers of chemists' goods and other goods when retailers broke manufacturers' prices. This may be novel to this country, but it is not a startling innovation in legislation, as it has been accepted in America for many years and has been enforced recently.
§ Sir L. Ungoed-ThomasI have been looking at the Amendment to see whether I understand it. Is the hon. Member for Twickenham (Mr. Gresham Cooke) really suggesting, for instance, that the retailer of "Aspro" who buys from one manufacturer should have a right of action against a retailer of "Genasprin" who buys from another manufacturer if the retailer of "Genasprin" reduces his price? Is that really the proposal?
§ Mr. Gresham CookeWhere both manufacturers advertise and give notice of the price of "Aspro" and "Genasprin," if retailer A breaks the price I do not see why retailer B should not be able to take action.
§ Sir L. Ungoed-ThomasAlthough there is no agreement between the manufacturers of "Aspro" and "Genasprin"?
§ Mr. Gresham CookeI agree that there is no privity of contract. As my hon. and learned Friend the Member for Middlesbrough, West (Mr. Simon) said, this is not a new principle. We get the principle already on the sale of plots of land where restrictive covenants are entered into by buyers of land and one enforces against the other.
§ Sir L. Ungoed-ThomasThat is quite wrong. It is a quite startling proposition.
§ Mr. Gresham CookeI merely say that I should like to support what my hon. and learned Friend the Member for Middlesbrough, West said. As we have accepted the principle of resale price maintenance in this Clause, I would like to see the retailers have a direct right of action instead of having this cumbersome arrangement of having to go back to their own manufacturers.
§ Mr. P. ThorneycroftI am grateful to my hon. and learned Friend the Member for Middlesbrough, West (Mr. Simon) for tabling this Amendment and enabling us to have a discussion on a subject which is of importance—the question of the position of retailers under this arrangement. It has given me an opportunity of explaining the enforcement arrangements which are available and, although they do not go quite so far as my hon. Friends would wish, they are substantial and in many ways novel in this country. I hope that with that explanation, my hon. and learned Friend will see his way not to press for the Amendment.
§ Mr. SimonWhen I find the hon. and learned Gentleman the Member for Leicester, North-East (Sir L. UngoedThomas), speaking on this occasion with the accents of Lord Eldon, in agreement with my right hon. Friend the President of the Board of Trade, I realise that there is very little chance of getting this Amendment accepted by the Committee. Although I confess that I have not been impressed by all the arguments put forward, I beg to ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
§ Mr. E. FletcherI beg to move, in page 17, line 20, at the end to insert:
Provided that the contract under which such person acquired the goods for resale itself contained a condition as to the price at which such goods might be resold.In this Amendment we want to look at the matter from the point of view of the retailer against whom the contract is to be enforced. Therefore, we are looking at it from the reverse angle from that which we were considering on the last Amendment when we were considering who should enforce individual retail price maintenance. I do not quite agree with what the President said a moment ago, 1071 that we were giving manufacturers a right that was entirely novel in this country. What he had in mind, I think, was that since the well-known case of Dunlop Tyre Co.v. Selfridge &Co. in the House of Lords, in 1915, it has, in fact, been impossible for a person to sue on a contract to which he is not a party.It is very largely because of that decision that the whole of this extra legal system of private courts, stop lists, fines, and so forth, has grown up. I think that where I differ from the President is this. As Lord Justice Denning pointed out in a recent case—Drive Yourself Hire Co.v. Strutt—there is good warrant for saying that the decision in Dunlop v. Selfridge reversed the old common law and that for about 200 years the position was quite different. In the old days a party could at common law enforce a contract in which he had an interest, although he was not a party to it.
Where I think the President has gone wrong in this subsection is in looking at the matter from the wrong point of view. The common law, as I understand it, was this. If a manufacturer A made a contract with a wholesaler B providing that a particular article should only be resold at a certain price and requiring the wholesaler B to enter into a similar contract with any retailer C, then, if B entered into such a contract with C, A, in the old days, could have enforced the contract directly against C although he was not a party to the contract with C. That, however, has not been the law since the decision of the House of Lords in Dunlopv. Selfridge.
There, the point was that C, the retailer, had made a contract with B, the wholesaler, to sell the article at a particular price and personally I think that it is desirable, contrary to the decision of the House of Lords in Dunlop v. Selfridge, that A, for whose benefit C entered into that contract, should be able to enforce it directly against C, the retailer.
If Clause 20 had been constructed on those lines, I would have been in agreement with it. But it is not. What the President has done is this. He is providing that if A makes a contract with B for the sale of an article to a wholesaler B, then, if retailer C sells the articles with notice of that contract, A, the manufacturer, can enforce against C. The 1072 difficulty about that is that there is not necessarily any contract between B and C. This Clause is providing that A can enforce his contract not only against B but against someone else, the retailer who has notice of it. I think that that is an unfortunate way of drafting it, and I would have thought that it would have been a prerequisite of this legal method of enforcing individual resale price maintenance that there must be a contract between B and C which is to be enforceable by A. I think that that is the result we should aim at.
The only way, without a great deal of redrafting of the whole Clause, in which we can bring about that result is by putting down this Amendment, the effect of which is to extend the operative words "with notice" to provide that the person against whom the contract is, exhypothesi, being enforced acquired the goods for sale under a contract which itself contained a condition as to the price at which such goods might be resold. In other words, the doctrine of the enforcement of price maintenance by contract must, it seems to me, be based on contract and based primarily on a contract made by the person against whom it is to be enforced.
It is not enough to say that a manufacturer and a wholesaler made a contract and gave notice to the retailer. If that is the doctrine, then we get all kinds of doubt as to the circumstances in which the retailer gets notice, whether he must have written notice, whether he must have express notice, whether he has implied notice because there has been something in the Press or trade Press, or because he has bought similar articles under similar conditions before. I can foresee a whole range of debatable circumstances in which it is arguable whether the retailer is to be deemed to have had notice or not.
The object of this Amendment is to ensure that, as a basis of enforcement against a particular retailer, he himself should have entered into a contractual obligation with his supplier to resell at a particular price. If he has done so, I would think it right that the contract he has made should be enforceable against him not merely by his wholesaler, but by his manufacturer. That is the object of the Amendment, and I hope that the 1073 arguments in favour of it will commend themselves to the President of the Board of Trade.
Mr. P. ThorneyeroftI want to be fair to the Committee and make absolutely plain what I am trying to do here, whether anyone agrees with it or not, and then we can examine the wording.
What I am trying to do is to give the manufacturer the right to maintain an interest in the price at which his goods are sold past the wholesale stage right down to the retail stage. That is what I am doing, or intending to do. In that, I base myself on the Lloyd Jacob Report.
I will not read long passages from the Committee's Report, but the argument was set out at length that for a variety of reasons—the need for a large-scale manufacturer to have long runs at stable prices, for instance—it was right for a manufacturer in those circumstances to maintain his prices. He cannot do it by contract. I accept the hon. Member's argument; I may be wrong, but I believe that the manufacturer cannot do it by contract because there is no contract between A and C in the hon. Member's illustration.
6.30 p.m.
But I want him to be able to do it. I do not want him to be at peril whether the wholesaler happens to strike a contract with the retailer; that is not my purpose, and I do not want to leave the matter to luck. I am stating my purpose plainly because I want the Committee to understand it. I accept the Lloyd Jacob contention that there are solid, respectable, economic arguments in favour of the right of the individual manufacturer to preserve his contract over prices down the line, if I may use the shorthand expression for it.
§ Mr. Turner-SamuelsAs long as there is notice.
§ Mr. ThorneycroftI am obliged; as long as there is notice.
That is why we have not said that there should be a contract between A and C. If there is a contract, to some extent this provision would not be so necessary, because action could probably be taken under the contract. I am facing the case in which there is no contract but in which notice is given by the manufacturer of the price at which his goods are to be sold.
§ Mr. Turner-SamuelsNot necessarily notice given by the manufacturer; notice acquired by anyone.
Mr. ThorneyeroftYes. As long as the retailer against whom the injunction has been brought has acquired notice of the price conditions, the Clause will operate. That is my intention. I believe that there is solid support for it in the Lloyd Jacob Report, and I ask the Committee to accept it.
§ Mr. Roy JenkinsI should declare a rather tenuous interest in this matter in that I sometimes give economic advice to a large retail organisation.
For the purpose of discussion, I accept what the President is trying to do in this Clause, although I do not, in general, accept what he is trying to do. Although he is giving effect to that point of view, I think he should look a little more closely at possible modifications of the words, even if he cannot accept the exact wording suggested by my hon. Friend the Member for Islington, East (Mr. E. Fletcher). The words "with notice" would clearly cover the most casual passing of the information to the retailer that there was resale price maintenance. I am not even sure that it could not be done verbally. It might be given verbally by the wholesaler to a buyer of a retail organisation. Notice could be given in a whole range of ways which would make it far from clear to the retail organisation what was happening.
Some retail organisations which dislike resale price maintenance adopt a policy not of breaking a resale price maintenance agreement in so far as it exists, but of trying to avoid buying goods to which such agreements apply. Clearly, that is a reasonable and reputable point of view and we certainly do not want to put such organisations in a position in which, through a genuine misapprehension of the conditions, they can be caught by the Clause.
We do not want a long debate on the point, but I ask the right hon. Gentleman to bear in mind that the phrase "with notice" is the loosest possible phrase and that even if he cannot accept the Amendment he should look at the other Amendment on the Notice Paper, which is intended to cover the same point. We seek to insert the word "written" before the word "notice" and add afterwards,
at the time when such person contracted to acquire them1075 This is a point which gives rise to genuine concern, and I hope the right hon. Gentleman will see whether it can be covered.
§ Sir L. Ungoed-ThomasWe are concerned about two aspects of the Amendment. One, which was mentioned by my hon. Friend the Member for Stechford (Mr. Roy Jenkins), concerns the words "with notice." The phrase is extremely wide. It need not be written notice; it need not be oral notice; it may be notice which arises by some kind of implication. In the case of a notice to a company, it need not be notice to the managing director, but may be notice to an agent whose agency can be fixed upon the company for the purpose of receiving notice.
There may have been an advertisement in a paper which an agent of the company has seen and the question may arise whether this is sufficient notice within the Clause. I need not develop the point further, since the difficulties which arise are obvious, as is the nebulous nature of the wording. The Clause exposes retailers, as the President very fairly said, to an entirely new remedy; it exposes them to action in the Court. We therefore want to be precise in making clear the ground on which they will be liable.
The second aspect which worries us is that brought forward by my hon. Friend the Member for Islington, East (Mr. E. Fletcher). May I put it this way? If there is a contract between a manufacturer and a wholesaler, the manufacturer can sue the wholesaler on the contract. The contract may include a condition that the wholesaler, in his contract with the retailer, shall require that the resale shall not be below a certain price. If the wholesaler does not include that in his contract, there would be a breach of contract on his part, on which the manufacturer has a remedy.
I come now to the point made by my hon. Friend. Let us assume that the wholesaler has a contract with the retailer which provides that the retailer shall not sell below a certain price. There we have a very clear position; a contract between manufacturer and wholesaler providing for resale at not below a certain price; and a contract between wholesaler and retailer providing that there shall be no resale below a certain price. Under the law as it stands, if the 1076 wholesaler broke his contract with the manufacturer, the manufacturer would have a remedy against him, and if the retailer broke his contract with the wholesaler the wholesaler would have a remedy against the retailer.
I completely fail to see why anything more is necessary than that the manufacturer should be given a remedy direct against the retailer instead of bringing in the wholesaler. If that were the approach to the Clause it would at any rate be a provision which was easily recognisable: the remedies would be there, lying in contract; the contracts would be before the court in a form which was easily recognisable and there would not be the ambiguity which we have about the word "notice." In fact, the manufacturer would be provided with a direct remedy against the retailer.
I understand the position that where there is a contract between a manufacturer and a wholesaler, and between a wholesaler and a retailer, in the cases which I have mentioned, the manufacturer could not bring an action against the retailer without bringing in the wholesaler as well; and I can understand that in those circumstances it would be better to cut the wholesaler out. There would be advantages to the manufacturer in doing so. But it seems to me that it is asking for trouble and putting an undue burden on the retailer, as well as going much further than is reasonably necessary, even according to the President's own approach to the problem, to go any further than the proviso which my hon. Friend has brought before the Committee.
§ Sir Lancelot Joynson - Hicks (Chichester)The Amendment simply is not practicable and I hope that my right hon. Friend will not accept it. One can take the case of the village store, where the woman behind the counter says that she is sorry that she is out of a particular item but will get it by the following day. She rings up her wholesaler and orders the item. If the proposal of the hon. and learned Gentleman the Member for Leicester, North-East (Sir L. Ungoed-Thomas) were to operate, the wholesaler would have to grant a contract post it to the retailer who would have to sign it—and in the case of the village store the policeman would probably act as the witness—and post it back again. It would be 1077 several days before the required item was obtained.
That, of course, is an exaggerated example, but in actual business such a provision as that proposed would so add to the complications and the machinery of trade that it would add to the expense—which is one of the things which by the provisions of this Bill we are trying to reduce—and delay the normal flow of trade through its normal channels. The answer is perfectly simple. In every case the manufacturer will succeed in giving notice by printing on the package containing the commodity just what the retail price is.
§ Mr. E. FletcherIn the case mentioned by the hon. Gentleman all that is necessary is a clause in the wholesaler's invoice to the village storekeeper saying that the retail sale price of the article is so much. That constitutes a contract.
§ Mr, P. ThorneycroftI have listened to this discussion with a genuine desire to help. The difficulty is this. Where there is the straightforward case of the manufacturer having a contract with the wholesaler and the wholesaler then having a clear contract with the retailer there is no trouble about notice at all. That is the best, the easiest and the most straightforward case of notice there could be. I do not want to bring in the village policeman or anyone else, but the truth
§ is that life is not quite like that. Trade is not carried on in quite such a clear-cut manner. Indeed, with the rapid change of goods going from one stage of supply to another there will be many cases where the goods will pass without anything to which one could point as an actual contract.
§ In the case in stanced by my hon. Friend the Member for Chichester (Sir L. Joynson-Hicks) there probably would have been a contract, but very often it could be extremely difficult to establish a contract, and it is important that one should establish notice. The trouble is that the notice itself will be given—according to the fashion and habit of the trade—in very different ways in different classes of trade and of goods. I therefore believe that it would be rather difficut to write a definition of notice into a Bill.
§ I will certainly look at the precedents, but what is meant is a matter for the courts, and an injunction is, of course, a discretionary remedy. The safeguard is there—that it is a discretionary remedy—and no court will grant one unless it is satisfied that proper notice has been given.
§ Question put. that those words be there inserted:—
§ The Committee divided: Ayes 203; Noes 238.
1081| Division No. 173.] | AYES | [6.44 p.m. |
| Alnsley, J. W. | Collick, p. H. (Birkenhead) | Gibson, C. W. |
| Allaun, Frank (Salford, E.) | Collins, V. J. (Shoreditch Finsbury) | Gooch, E. G. |
| Alien, Arthur (Bosworth) | Corbet, Mrs. Freda | Gordon Walker, Rt. Hon. P. C. |
| Allen, Scholefield (Crewe) | Cove, W. G. | Greenwood, Anthony |
| Awbery, S. S. | Craddock, George (Bradford, S.) | Grey, C. F. |
| Bacon, Miss Alice | Cronin, J. D. | Griffiths, David (Rother Valley) |
| Bellenger, Rt. Hon. F. J. | Crossman, R. H. S. | Griffiths, Rt. Hon. James (Llanelly) |
| Bence, C. R. (Dunbartonshire, E.) | Cullen, Mrs. A. | Griffiths, William (Exchange) |
| Benson, G. | Daines, p. | Hale, Leslie |
| Beswick, F. | Dalton, Rt. Hon. H. | Hall, Rt. Hn. Glenvil (Colne Valley) |
| Blenkinsop, A. | Darling, George (Hillsborough) | Hamilton, W. W. |
| Blyton, W. K. | Deer, G. | Hannan, W. |
| Boardman, H. | de Freitas, Geoffrey | Harrison, J. (Nottingham, N.) |
| Bowden, H. W. (Leicester, S.W.) | Delargy, H. J. | Hastings, S. |
| Bowen, E. R. (Cardigan) | Dodds, N. N. | Hayman, F. H. |
| Bowles, F. G. | Donnelly, D. L. | Healey, Denis |
| Boyd, T. C. | Dugdale, Rt. Hn. John (W. Brmwch) | Henderson, Rt. Hn. A. (Rwly Regis) |
| Braddock, Mrs. Elizabeth | Dye, S. | Hobson, C. R. |
| Brockway, A. F. | Ede, Rt. Hon. J. C. | Holmes, Horace |
| Broughton, Dr. A. D. D. | Edwards, Rt. Hon. John (Brighouse) | Houghton, Douglas |
| Brown, Rt. Hon. George (Belper) | Edwards, Rt. Hon. Ness (Caerphilly) | Hubbard, T. F. |
| Brown, Thomas (Ince) | Edwards, Robert (Bilston) | Hughes, Cledwyn (Anglesey) |
| Burke, W. A. | Evans, Albert (Islington, S.W.) | Hughes, Emrys (S. Ayrshire) |
| Burton, Miss F. E. | Evans, Edward (Lowestoft) | Hughes, Hector (Aberdeen, N.) |
| Butler, Mrs. Joyce (Wood Green) | Evans, Stanley (Wednesbury) | Hunter, A. E. |
| Castle, Mrs. B. A. | Fernyhough, E. | Irvine, A. J. (Edge Hill) |
| Champion, A, J. | Finch, H. J. | Irving, S. (Dartford) |
| Chapman, W. D. | Fletcher, Erie | Isaacs, Rt. Hon. G. A. |
| Chetwynd, G. R. | Forman, J. C. | Janner, B. |
| Clunie, J. | Fraser, Thomas (Hamilton) | Jay, Rt. Hon. D. P. T. |
| Coldrick, W. | Gaitskell, Rt. Hon. H. T. N. | |
| Jeger, George (Goole) | Moyle, A. | Steele, T, |
| Jenkins, Roy (Stechford) | Mulley, F. W. | Stokes, Rt. Hon. R. R. (Ipswich) |
| Johnson, James (Rugby) | Neal, Harold (Bolsover) | Stones, W. (Consett) |
| Johnston, Douglas (Paisley) | Oliver, G. H. | Summerskill, Rt. Hon. E. |
| Jones, Rt. Hon. A. Creech (Wakefield) | Oram, A. E. | Swingler, S. T. |
| Jones, David (The Hartlepools) | Oswald, T, | Sylvester, G. O. |
| Jones, Jack (Rotherham) | Owen, W. J. | Taylor, Bernard (Mansfield) |
| Jones, J. Idwal (Wrexham) | Paling, Rt. Hon. (Dearne Valley) | Taylor, John (West Lothian) |
| Jones, T. W. (Merioneth) | Paling, Will T. (Dewsbury) | Thomas, lorwerth (Rhondda, W.) |
| Kenyon, C. | Pargiter, G. A. | Thomson, George (Dundee, E.) |
| Key, Rt. Hon. C. W. | Parker, J. | Thornton, E. |
| King, Dr. H. M. | Parkin, B. T. | Tomney, F. |
| Lawson, G. M. | Paton, J. | Turner-Samuels, M. |
| Lee, Frederick (Newton) | Pearson, A. | Ungoed-Thomas, Sir Lynn |
| Lee, Miss Jennie (Cannock) | Plummer, Sir Leslie | Viant, S. P. |
| Lewis, Arthur | Popplewell, E. | Warbey, W. N. |
| Logan, D. G. | Price, J. T. (Westhoughton) | Watkins, T. E. |
| Mabon, Dr. J. Dickson | Price, Philips (Gloucestershire, W.) | Weitzman, D. |
| MacColl, J. E. | Probert, A. R. | Wells, Percy (Faversham) |
| McChee, H. G. | Proctor, W. T. | Wells, William (Walsall, N.) |
| McGovern, J. | Pryde, D. J. | West, D. G. |
| McInnes, J. | Randall, H. E. | Wheeldon, W. E. |
| McKay, John (Wallsend) | Redhead, E. C. | White, Henry (Derbyshire, N.E.) |
| MeLeavy, Frank | Reeves, J. | Wilcock, Group Capt. C. A. B. |
| MacMillan, M. K. (Western Isles) | Reid, William | Willey, Frederick |
| MacPherson, Malcolm (Stirling) | Robens, Rt. Hon. A. | Williams, David (Neath) |
| Mallalleu, E. L. (Brlgg) | Roberts, Albert (Normanton) | Williams, Rev. Llywelyn (Ab'tillery) |
| Mann, Mrs. Jean | Roberts, Goronwy (Caernarvon) | Williams, W. R.(Openshaw) |
| Marquand, Rt. Hon. H. A. | Rogers, George (Kensington, N.) | Williams, W. T. (Barons Court) |
| Mason, Roy | Ross, William | Wilson, Rt. Hon. Harold (Huyton) |
| Messer, Sir F. | Royle, C. | Winterbottom, Richard |
| Mikardo, Ian | Shinwell, Rt. Hon. E. | Woodburn, Rt. Hon. A. |
| Monslow, W. | Silverman, Julius (Aston) | Woof, R. E. |
| Moody, A. S. | Simmons, C. J. (Brierley Hill) | Yates, V.(Ladywood) |
| Morris, Percy (Swansea, W.) | Skeffington, A.M. | Zilliacus, K. |
| Morrison, Rt. Hn. Herbert (Lewis'm, S.) | Slater, J. (Sedgefield) | |
| Mort, D. L. | Smith, Ellis (Stoke, S.) | TELLERS FOR THE AYES: |
| Moss, R. | Sorensen, R. W. | Mr. Short and Mr. Wiikins. |
| NOES | ||
| Agnew, Cmdr. P. G. | Currie, G. B. H. | Harvey, John (Walthamstow, E.) |
| Aitken, W. T. | Danee, J. C. G. | Hay, John |
| Allan, R. A. (Paddington, S.) | D'Avigdor-Goldsmid, Sir Henry | Head, Rt. Hon. A. H. |
| Alport, C. J. M. | Deedes, W. F. | Heald, Rt. Hon. Sir Lionel |
| Amery, Julian (Preston, N.) | Digby, Simon Wingfield | Heath, Rt. Hon. E. R. G. |
| Arbuthnot, John | Donaldson, Cmdr. C. E. McA. | Henderson, John (Cathcart) |
| Armstrong, C. W. | Doughty, C. J. A. | Hicks-Beach, Maj. W. W. |
| Ashton, H. | Drayson, G. B. | Hill, John (S. Norfolk) |
| Baldock, Lt.-Cmdr. J. M. | du Cann, E. D. L. | Hinchingbrooke, Viscount |
| Baldwin, A. E. | Dugdale, Rt. Hn. Sir T. (Richmond) | Hirst, Geoffrey |
| Balniel, Lord | Duncan, Capt. J. A. L. | Holland-Martin, C. J. |
| Barlow, Sir John | Duthie, W. S. | Hornsby-Smith, Miss M. P. |
| Barter, John | Eden, T. B. (Bournemouth, West) | Horobin, Sir Ian |
| Baxter, Sir Beverley | Elliot, Rt. Hon. W. E. | Horsbrugh, Rt. Hon. Dame Florence |
| Beamish, Major Tufton | Emmet, Hon. Mrs. Evelyn | Howard, Hon. Greville (St. Ives) |
| Bell, Philip (Bolton, E.) | Errington, Sir Eric | Howard, John (Test) |
| Bell, Ronald (Bucks, S) | Farey-Jones, F. W. | Hudson, Sir Austin (Lewisham, N.) |
| Bevins, J. R. (Toxteth) | Fell, A. | Hudson, W. R. A. (Hull, N.) |
| Bidgood, J. G. | Finlay, Graeme | Hughes Hallet, Vioe-Admiral J. |
| Biggs-Davidson, J. A. | Foster, John | Hughes-Young, M. H. C. |
| Birch, Rt. Hon. Nigel | Fraser, Hon. Hugh (Stone) | Hurd, A. R. |
| Bishop, F. P. | Freeth, D. K. | Hutchison, Sir Ian Clark(E'b'gh, W.) |
| Body, R. F. | Galbraith, Hon. T. G. D. | Hutchison, Sir James (Scotstoun) |
| Bossom, Sir A. C. | Garner-Evans, E. H. | Hylton-Foster, Sir H. B. H. |
| Boyd-Carpenter, Rt. Hon. J. A. | George, J. C. (Pollok) | Iremonger, T. L. |
| Boyle, Sir Edward | Gibson-Watt, D. | Irvine, Bryant Godman (Rye) |
| Braine, B. R. | Glover, D. | Jennings, J. C. (Burton) |
| Brooman-White, R. C. | Gomme-Dunoan, Col. Sir Alan | Johnson, Dr. Donald (Carlisle) |
| Browne, J. Nixon (Craigton) | Gower, H. R. | Johnson, Eric (Blackley) |
| Bryan, P. | Graham, Sir Fergus | Johnson, Howard (Kemptown) |
| Butcher, Sir Herbert | Grant-Ferris, Wg. Cdr. R. (Nantwioh) | Jones, Rt. Hon. Aubrey (Hall Green) |
| Butler, Rt. Hn. R. A. (Saffron Walden) | Green, A. | Joseph, Sir Keith |
| Campbell, Sir David | Gresham Cooke, R. | Joynson-Hicks, Hon. Sir Lancelot |
| Carr, Robert | Grimond, J. | Kerby, Capt. H. B. |
| Cary, Sir Robert | Grimston, Hon. John (St. Albans) | Lambert, Hon. G. |
| Channon, H. | Grosvenor, Lt.-Col. R. G. | Lambton, Viscount |
| Clarke, Brig. Terence (Portsmth, W.) | Hall, John (Wycombe) | Lancaster, Col. C. G. |
| Cole, Norman | Hare, Rt. Hon. J. H. | Langford-Holt, J. A. |
| Cordeaux, L.-Col. J. K. | Harris, Frederic (Croydon, N.W.) | Leather, E. H. C. |
| Corfield, Capt. F, V. | Harris, Reader (Heston) | Leavey, J. A. |
| Craddock, Beresford (Spelthorne) | Harrison, A. B. C. (Maldon) | Leburn, W. G. |
| Crowder, Sir John (Finchley) | Harrison, Col. J. H. (Eye) | Legge-Bourke, Maj. E. A. H. |
| Crowder, Petre (Ruislip—Northwood) | Harvey, Air Cdre. A. V. (Macclesfd) |
| Legh, Hon.Peter(Petersfield) | Noble, Comdr. A. H. P. | Stevens, Geoffrey |
| Lennox-Boyd, Rt. Hon. A. T. | Nutting, Rt. Hon. Anthony | Steward, Harold (Stockport, S.) |
| Linstead, Sir H. N. | Oakshott, H. D. | Steward, Sir William (Woolwich, W.) |
| Llewellyn, D. T. | O'Neill, Hn. Phelim (Co. Antrim, N.) | Stoddart-Scott, Col. M. |
| Lloyd, Maj. Sir Guy (Renfrew, E.) | Qrr, Capt. L. P. S. | Studholme, H. G. |
| Longden, Gilbert | Osborne, C. | Summers, G. S. (Aylesbury) |
| Lucas, Sir Jocelyn (Portsmouth, S.) | Page, R. G. | Taylor, Sir Charles (Eastbourne) |
| Lucas-Tooth, Sir Hugh | Pannell, N. A. (Kirkdale) | Taylor, William (Bradford, N.) |
| McAdden, S. J. | Partridge, E. | Teeling, W. |
| Macdonald, Sir Peter | Peyton, J. W. W. | Thomas, Leslie (Canterbury) |
| McKibbin, A. J. | Pickthorn, K. W. M. | Thomas, P. J. M. (Conway) |
| Mackie, J. H. (Galloway) | Pilkington, Capt. R. A. | Thompson, Lt.-Cdr. R. (Croydon, S.) |
| McLaughlin, Mrs. P. | Pitman, I. J. | Thorneycroft, Rt. Hon. P. |
| Maclay, Rt. Hon. John | Pott, H. P. | Thornton-Kemsley, C. N. |
| Maclean, Fitzroy (Lancaster) | Profumo, J D. | Tiley, A. (Bradford, W.) |
| McLean, Nell (Inverness) | Raikes, Sir Victor | Tilney, John (Wavertree) |
| Macleod, Rt. Hn. Iain (Enfield, W.) | Redmayne, M. | Touche, Sir Cordon |
| MacLeod, John (Ross & Cromarty) | Remnant, Hon.P. | Turner, H. F. L. |
| Macpherson, Niall (Dumfries) | Renton D. L. M. | Turton, Rt. Hon. R. H. |
| Maitland, Cdr. J. F. W.(Horncastle) | Rippon, A. C. F. | Tweedsmuir, Lady |
| Maitland, Hon. Patrick (Lanark) | Robertson, Sir David | Vane, W. M. F. |
| Manningham-Buller, Rt. Hn. Sir R. | Robson-Brown, W. | Vosper, D. F. |
| Markham, Major Sir Frank | Rodgers, John (Sevenoaks) | Wade, D. W. |
| Marlowe, A. A. H. | Roper, Sir Harold | Wakefield, Edward (Derbyshire, W.) |
| Marples, A. E. | Ropner, Col. Sir Leonard | Walker-Smith, D. C. |
| Marshall, Douglas | Russell, R. S. | Wall, Major Patrick |
| Maude, Angus | Schofield, Lt.-Cot. W. | Ward, Dame Irene (Tynemouth) |
| Maudling, Rt. Hon. R. | Scott-Miller, Cmdr. R. | Whitelaw, W. S. I. (Penrith & Border) |
| Maydon Lt.-Comdr. S. L. C. | Sharples, R. C. | Williams, Paul (Sunderland, S.) |
| Milligan, Rt. Hon. W. R. | Shepherd, William | Wills, G. (Bridgwater) |
| Molson, A. H. E. | Simon, J. E. S. (Middlesbrough, W.) | Wilson, Geoffrey (Truro) |
| Monckton, Rt. Hon. Sir Walter | Smithers Peter (Winchester) | Wood, Hon. R. |
| Morrison, John (Salisbury) | Smyth, Brig. Sir John (Norwood) | Woollam, John Victor |
| Nabarro, G. D. N. | Soames, Capt. C. | Yates, William (The Wrekin) |
| Nairn, D. L. S. | Spearman, A. C. M. | |
| Neave, Airey | Spenoe, H. R. (Aberdeen, W.) | TELLERS FOR THE NOES: |
| Nicholls, Harmar | Spens, Rt. Hn. Sir P. (Kens'gt'n, S.) | Mr. Godber and Mr. Barber. |
| Nield, Basil (Chester) | Stanley, Capt. Hon. Richard |
§ The Temporary Chairman (Major Anstruther-Gray)The next Amendment is that to Clause 20, page 17, line 35, in the name of the hon. Member for East Ham. South (Mr. Oram), and I understand that it will be convenient for the Committee also to discuss the Amendment to Clause 21, page 18, line 6, in the name of the hon. Member for Ogmore (Mr. Padley).
§ Mr. A. E. Oram (East Ham, South)I beg to move, in page 17, line 35, at the end to insert:
(4) The granting by a society registered under the Industrial and Provident Societies Acts, 1893 to 1954 of any discount, rebate or dividend to its members payable at intervals of not less than a quarter of a year in respect of amounts paid or payable by or to them on account of their transactions with the Society shall not be treated as a breach of a condition as to the price at which any goods acquired by the Society may be resold and no proceedings under this section shall be taken by a supplier of goods against such a Society solely on the grounds that the granting of a discount, rebate or dividend by the Society in the circumstances hereinbefore mentioned is a breach of a condition as to the price at which the goods may be resold.It may be helpful to the Committee as a whole, and to the hon. and learned Member for Middlesbrough, West (Mr. Simon) in particular, if, at the outset, I say that my hon. Friends and I are will 1082 ing to accept his proposed Amendments to our Amendment. The proposed Amendments of the hon. and learned Gentleman are more general in their purpose, but we are quite willing that the principle which we have sought to lay down in our Amendment should also apply to traders other than co-operative societies if they see fit to imitate the methods which the co-operative societies employ. My especial concern is with the position—
§ The Temporary ChairmanOrder. To prevent any misunderstanding, I should say that I was under the impression that those Amendments were not to be moved. Am I right?
§ Mr. SimonI have not heard that, but I am anxious to hear what my right hon. Friend the President has to say about the main Amendment which has just been moved before taking any decision about them.
§ The Temporary ChairmanIn that case, perhaps the hon. Member for East Ham, South will continue his speech.
§ Mr. OramIn reply to what the hon. and learned Member for Middlesbrough, West has said, may I say that I will accept his Amendments if they are moved?
1083 My main concern and that of my hon. Friends is with the position of co-operative societies under this Clause. Perhaps I ought, therefore, at the outset to declare an interest, since I am a loyal and enthusiastic member of the Co-operative movement, and this Amendment is designed to protect one of the fundamental principles of co-operative trading—the right to pay dividends on purchases. I would remind the Committee that that interest of mine is shared by more than 11 million other cooperators. We have joined together in our vast social and commercial movement in order to own and run jointly our thousand retail societies, to own our factories and warehouses and our 25,000 shops. and to conduct that vast business according to the special co-operative, democratic, non-profit-making principles. On the basis of those principles, our movement has grown to a position of tremendous success and strength from very humble origins.
One of the most important of those principles is that we return the surplus at the end of a trading period to the purchasers from whom that surplus was made in proportion to the purchases which they make at their co-operative stores. That is the well-known principle of the "co-op. divi", and it is that principle which I assert is placed in jeopardy by Clause 20.
These 11 million co-operators are of many kinds. We pride ourselves on open membership. We apply no test of a political or religious kind, and indeed many of the members do not share my own attitude to political and economic affairs. Many of them, I regret, are to be numbered among the supporters of the President of the Board of Trade, but. whatever may be their differences on their public or co-operative affairs, we can be sure that they all welcome their cooperative dividend on their purchases, and that they are all irritated when they go into the co-operative store and are told that on a particular commodity they cannot have their dividend because the manufacturer of that commodity has imposed a ban on the payment of dividend on that article.
Clause 20, in our view, will give the backing of a court of law to that kind of ban, and it will, therefore, be a 1084 deliberate encouragement to other manufacturers who have not imposed that ban so far to do so. It will be our clear duty on this side of the Committee, if this Clause goes unamended, to explain to these 11 million co-operators whose responsibility it is for giving direct encouragement to all and sundry in the manufacturing world to impose a ban on a co-operative dividend.
§ Mr. Philip Bell (Bolton, East)What is there to prevent the powerful co-operative organisation putting in their contracts, "We will buy from you, but we are going to pay a dividend"?
§ 7.0 p.m.
§ Mr. Turner-SamuelsThe answer is that they will not sell.
§ Mr. OramThe experience of the Co-operative movement is that manufacturers have refused to supply. Over the past 50 years they have refused to supply when we have tried to insist on our right to pay dividend.
§ Mr. BellHow does that help? If this Amendment is passed there is nothing to prevent them saying, "We do not like this provision, so we are not going to supply at all." One is caught either way.
§ Mr. OramThe point is that this Amendment will give them the right to go to courts of law. At present, they have not that power. This provision will enable them to enforce their conditions with the backing of the courts of law.
I was about to say, before I was interrupted, that the Co-operative movement has had a long and unfortunate history of this kind of discrimination against it. The movement has complained to successive Governments about their inability to get a whole series of articles because of the nature of co-operative trade. We have been prevented from getting wireless sets, television sets, vacuum cleaners, washing machines, toys, games, and a whole list of articles of that kind because we dare to conduct our business in a certain non-profit-making way.
Our objection to Clause 20 is that it opens the door wide to that sort of discrimination, and the Co-operative movement sees in this a real threat to its trade. 1085 It sees a real danger that in respect of a wide range of its trade it will be prevented from practising its special commercial methods.
The Lloyd Jacob Committee on Resale Price Maintenance made clear its attitude to this question of the co-operative dividend, or the deferred rebate as it is sometimes called. Paragraph 101 of that Report says:
We can see no reason why a retailer's right to distribute some of his profits in this way should be restrained or restricted, and we do not consider that a bona fide exercise of this freedom can imperil the trade or good-will of any manufacturer. The difference between the two methods of price reduction is, as we have already said, that whereas deferred discounts are paid in respect of past purchases and are applied to the general run of goods sold, price cuts ' such as are associated with the loss-leader technique are made at the time of sale and are applied to a few commodities or a specially selected commodity only."That is a clear and most important distinction between the price cut which is immediately made and the deferred rebate which is made periodically and applies to a whole range of a customer's purchases. We have had in recent months a very important example of that distinction. We have heard in the debates on this Bill that the book publishers and retailers can argue a very powerful case in favour of their net book agreement. But quite recently they have recognised this vital difference between a price cut on a particular book and the payment of a co-operative dividend on books sold by a co-operative society—a discount is paid but is included in that on the general purchases of the co-operative member. In fact, co-operative societies have been exempted from the provision of the net book agreement.It is just that distinction that we, in this Amendment, are urging the President of the Board of Trade to make in general. If he does so, he will be following, first, the advice of the most important Committee which has investigated this matter, namely, the Lloyd Jacob Committee, and, secondly, those who are among the most strong exponents of resale price maintenance, namely, the book publishers.
There is a general similarity in the approach of the Bill to the recommendations of the Lloyd Jacob Committee. Both the Bill and that Report are against collective resale price maintenance, and both, in general, are in favour of individual price maintenance. But Clause 20 1086 goes well beyond the intention of the Lloyd Jacob Report in respect of individual resale price maintenance, in that it gives the sanction of the court to the individual to maintain the price which he has fixed.
There was another recommendation of the Lloyd Jacob Committee which has been entirely ignored by the President of the Board of Trade and his advisers in framing the Bill. I should like to read a paragraph of the Report because it is of great importance. Paragraph 164 says:
Producers are not, in our opinion, entitled to use resale price maintenance to obstruct the development of particular methods of trading, to impede the distribution by another manufacurer of competitive goods or to deprive the public of the benefits of improvement in distribution. Public policy requires adequate distribution of goods with provision for such price reductions as are justified by low-cost distribution or by a regular policy of distributing surplus profit to the customer.That is quite clear in the Committee's recommendations, and I would emphasise that that was a body of experts who were not opposed, as some of us here are, to individual resale price maintenance entirely but recommended in favour of individual resale price maintenance. However, the Committee drew this clear distinction between the immediate price cut and the deferred rebate in the system which we have employed in the co-perative movement.The second consideration that the Committee had in mind was this question of low-cost distribution. My hon. Friend the Member for Deptford (Sir L. Plummer), who was arguing powerfully on an earlier Clause the case in respect of self-service trading, was pointing out that retailers of all kinds ought to be allowed to pass on to the consumer the benefits of any efficiencies that they are able to introduce into their trading.
I do not want to repeat my hon. Friend's argument, but here is something in which the Co-operative movement has a very special interest because we in this country pioneered the self-service shop and we believe it is most important that co-operative societies should be able to pass on as dividend to their members the benefits of the introduction of such methods as self-service trading.
I have referred so far to the retail trade, but I should like to remind the Committee that it is not just retail trade 1087 which is covered by the terms of this Amendment, nor indeed by the Amendments to our Amendment, which may or may not be moved later.
§ The Temporary ChairmanPerhaps it would make matters clearer if I were to inform the hon. Gentleman that the Amendments in the name of the hon. and learned Member for Middlesbrough, West (Mr. Simon) are not selected.
§ Mr. OramI am much obliged, Major Anstruther-Gray. I will therefore confine my remarks to my Amendment.
The point I wish to make is that the Industrial and Provident Societies Acts cover not just retail co-operative societies but agricultural co-operative societies as well. It is surely welcome on both sides of the Committee that there has been a significant growth in the activities of agricultural co-operative societies in this country since the end of the war. I believe it to be true that about two-thirds of all farmers are members, in some capacity or other, of an agricultural co-operative society.
I know that there are right hon. and hon. Gentlemen opposite who themselves are directly interested in this new and important development in the agricultural industry. Only last week we read inThe Timesthat the National Farmers' Union and the Agricultural Co-operative Association have got together and formed a new association, from which it is hoped that there will be even greater development of agricultural co-operation.
It seems to be an essential principle of agricultural co-operation that farmers should be able to receive a deferred rebate just as the housewife does who buys goods from a co-operative shop and later receives her "divi". If this Clause is passed unamended, it will be open to manufacturers to impose on farmers' cooperative societies the same sort of ban to which we in the retail movement so strongly object.
I would urge the President, before he says his final word on this Amendment, to consult his hon. Friends on the benches behind him, particularly those with knowledge of agricultural co-operation, to ask the National Farmers' Union about their arrangements in connection with this new Co-operative Association, and also to ask 1088 himself whether he would wish to facilitate the possible imposition of a ban on an essential principle which is being applied in agricultural co-operation.
Finally, I would urge the President to consult his right hon. Friend the Chancellor of the Exchequer on the savings aspect of co-operative dividend. The Chancellor is urging everyone to save, and he is receiving a good deal of support in that. The co-operative societies are among the most important small savings institutions. As I have mentioned, there are 11 million co-operators, and there is an aggregate of about £300 million of savings belonging to them. Each year the co-operative dividend amounts to about £40 million, which is returnable to the consumer members, and evidence which I have collected indicates that probably half of that amount is not actually withdrawn by members but is left as savings in the societies.
Small savings by housewives amounting to £20 million ought to be taken into account by the President of the Board of Trade in association with his right hon. Friend. It is not something which ought lightly to be ignored. When the President indicates his attitude towards this Amendment he should answer such questions as this: does he want to encourage small savings or not?
I assure the President that he cannot, with impunity, attack one of the basic principles upon which 11 million consumers and 200,000 farmers have sucessfully organised themselves. Unless he accepts this Amendment he will be rejecting the specific advice of the Lloyd Jacob Committee on these matters. He will be discouraging the introduction of low-cost methods of distribution in the retail trade; he will be discouraging one of the most hopeful and interesting experiments in post-war agriculture, and he will be striking a blow at one of the most important thrift institutions among the working classes. I urge him seriously to think about these matters again—and, if need be, to think yet again—before he is guilty of any of those regrettable errors.
§ 7.15 p.m.
Mr. P. ThorneyeroftThe hon. Member for East Ham, South (Mr. Oram) has made an eloquent and persuasive speech on the subject of the co-operative dividend. Very properly, he declared an 1089 interest, and I say at once that that certainly does not disqualify him from speaking on this matter; indeed, it adds force to his remarks. The last thing I would have in mind would be to attack co-operative societies, which are a great institution in this country and which make a very great contribution in many fields. I am certainly not here to attack them in any way whatsoever.
I want to put the hon. Member's arguments into the context of the Bill, and to explain precisely what the Bill does, because that may bring our debate within a somewhat narrower compass. I am not complaining about the hon. Member's speech; he was right to open the matter on a broad front, but I do think that we must now look at this matter with greater particularity.
Clause 19, which we have now passed, outlaws collective enforcement. Clause 20, which we are now discussing, provides a new method of individual enforcement. Both Clauses deal with enforcement, and this Amendment has nothing whatever to do with that. I am not complaining or saying for one minute that the hon. Gentleman's Amendment is out of order, but it has nothing to do with enforcement. It raises an interesting and important question about price maintenance. that is, what price conditions should be enforced; but that is a quite different point altogether.
The point I wish to make is that this Bill has no effect whatsoever upon the existing situation as to what price conditions should be laid down.
§ Mr. G. DarlingNo.
§ Mr. ThorneycroftIf the hon. Gentleman the Member for Hillsborough (Mr. G. Darling) will listen to me, he will follow the argument as I develop it.
Precisely the same price conditions can be laid down on the day after the Bill becomes law as were laid down the day before, and by exactly the same people, namely the suppliers. I am not saying that an argument cannot be advanced as to whether this is right or wrong; I am merely describing what the Bill does. The position today is that suppliers, whether supplying to the private sector of industry, to the co-operative sector, or to the nationalised sector of industry—whoever it may be—lay down the price conditions; they say they want an article which 1090 they supply to be sold at a certain price, and they lay the conditions down, very properly, in detail.
The arrangements which suppliers make vary one from another; some of them, for example in the grocery trade, the electric lamp trade, the tobacco trade, and, as the hon. Member for East Ham, South pointed out just now, the book trade, prefer to treat the matter rather flexibly and allow discounts, either immediate or deferred, without treating such discounts as price cutting in any way. Others treat the matter more rigidly, either regarding discounts as price cutting or agreeing to discounts only if the price is artificially raised before the discount is in fact paid.
After the Bill is passed, the position will be exactly the same; the only difference will be in the method of enforcement. The method of enforcement which at this moment operates namely, collective enforcement of resale price maintenance, will be outlawed; it will no longer be lawful for any two or more persons to refuse supplies to a co-operative society in order to enforce resale conditions. Such practices will be outlawed under Clause 19, and there are many co-operators who think that is an important advance.
Under Clause 20, however, it is true to say that there is a new method of individual enforcement; the supplier, whether he is in direct contractual relationship with a co-operative society or not, will be able to use the injunction machinery there laid down. Nevertheless, he will have exactly the same freedom in his policy as he had before.
There is an argument as to whether the co-operative society is in a stronger or weaker position as a result of these changed arrangements. We had some argument about this a little time ago. Some hon. Members were contending that we had greatly weakened the enforcement arrangements of resale price maintenance. To that extent the position of the hon. Member for East Ham, South would be greatly strengthened, because he does not wish for strong methods of enforcement. He is arguing that the enforcement arrangements rather worsened the position of the co-operative societies.
My own view is that under the combination of these various Clauses—while 1091 retail prices can be maintained—with the abolition of collective enforcement of retail price maintenance, more flexibility will be introduced into the arrangements. There will be a tendency to allow rather greater freedom in the whole mechanism of deciding what is or what is not price-cutting. That is a view strongly held both by the Lloyd Jacob Committee and the Monopolies Commission, and that is their principal reason for urging that massive arrangements for the collective enforcement of retail prices should be done away with altogether.
I agree that it is a matter of argument whether the position is stronger or weaker. I think that on the whole rather more flexibility is introduced, but the position as to what conditions and what prices a supplier can lay down is unchanged in any particular by this Measure.
§ Mr. F. Beswick (Uxbridge)What does the right hon. Gentleman mean by "more flexibility"? Does he mean that some firm or association of firms can lay down a condition that a dividend should not be paid, or that some will not lay it down? How, between payment or nonpayment of dividend, is there scope for flexibility?
§ Mr. ThorneycroftIf the hon. Member will read paragraphs 145 to 147 of the Lloyd Jacob Report he will see that the argument is laid out most clearly there.
§ Mr. BeswickNot on this point.
§ Mr. ThorneycroftThe whole basis was that so long as there were trade associations policing these complex arrangements whereby wholesalers, manufacturers and retailers were often working in one interlocked group for price maintenance, no flexibility whatsoever was allowed. That position has been cured effectively by Clause 19, and a new method of individual enforcement is introduced by Clause 20. But there is no change whatsoever as to the conditions that can be laid down by individual suppliers.
After the Bill is made law, individual suppliers will differ among themselves, as they do now. Some will and some will not allow the payment of dividends, and I agree that one cannot single out the co-operative societies. If we are to deal 1092 with this matter we must deal with discounts however paid, whether immediate or deferred. But the position as to dividends will be precisely the same.
The hon. Member for East Ham, South quoted from paragraph 165 of the Lloyd Jacob Report, which supports his case, and there is force in it. There is no question about that. I will not waste the time of the Committee by pretending that it does not support the hon. Member's case, but of course it is easier to put a proposal of that kind into a Report than it is to translate it into legislation. That goes a great deal wider than the co-operative case. The paragraph says that where there is economy in some form of distribution, resale price maintenance should be so flexible as to take that economy into account.
In a perfect State, and if I could find a way of doing it, there is a lot to be said for translating a recommendation of that kind into legislation, but we certainly cannot do it in this Bill, and in the Bill I have no intention of legislating for or against the co-operative dividend. No Clause in the Bill says that a dividend should or should not count for price-cutting purposes. It will remain, as it remains now, entirely a matter for the individual supplier to decide. It is true that it is provided in a Clause in the Bill that he can specify that conditions as to price—including arrangements for discount and dividend as he wishes—as he can do today. The only thing that the Bill does is to re-arrange matters of enforcement, and if the Lloyd Jacob Report stands for anything it means that the co-operative societies are in a better position.
§ Mr. Turner-SamuelsWould the right hon. Gentleman say whether the Clause, to which this Amendment applies, really catches dividend or merely gives power to enforce by legal proceedings conditions as to retail prices?
§ Mr. ThorneycroftI think that conditions as to retail prices include dividends and discount today as a matter of trade practice, and they will continue to do so after the Bill becomes law.
§ Mr. G. DarlingThe President of the Board of Trade has been very selective in the examples which he has given from the Lloyd Jacob Report. There are many more paragraphs, such as paragraphs 96, 1093 101, 102 and 114, which deal precisely with this question of deferred rebates. The Lloyd Jacob Committee states quite clearly:
We see no reason why a retailer's right to distribute some of his profits in this way should be restrained or restricted and we do not consider that a bona fide exercise of this freedom can imperil the trade or the good-will of any manufacturer.I am sure that the right hon. Gentleman will agree with that, but the Amendment is not accepted and neither apparently will the Amendment to Clause 21 on this same point with which the right hon. Gentleman has not dealt, be accepted.Clause 21 specifically states that the amount of discount which may be allowed in any sale should be counted as a condition of sale. If the Bill goes through in its present form, the manufacturer can say to a co-operative society, "If you insist on paying dividends to purchasers of my goods I shall not supply you". Under Clauses 20 and 21 he will be given the opportunity of legally enforcing that condition in the courts.
The President of the Board of Trade said that he does not want to legislate either for or against co-operative societies. We on this side of the Committee do not want him to do so, but many of the manufacturers are looking to the Bill as their effective instrument to deal with co-operative societies in precisely that way. To us the position is very simple, and if we could have the Bill without a great deal of lawyers' language in it, which is of course impossible, we could make the position quite clear.
While the Bill lays down quite clearly that individual manufacturers can enforce individual prices, we want to ensure that that right should not be taken further to mean that traders who take and resell the manufacturers' goods shall be dictated to by the manufacturers as to how they shall distribute their profits. That is a quite different issue of principle from the question of price.
7.30 p.m.
Let us be perfectly clear: the cooperative societies are not price-cutters. If manufacturers, under the Bill want to lay down their prices for retail sale, there is no question that the co-operative societies would agree to sell the goods at those prices. Our concern is whether 1094 the manufacturer has a further right, beyond the right to lay down the retail price, to say to co-operative societies or to any other traders—we are not asking for any specially favourable position for co-operative societies—that they must not distribute their profit to their customers but must distribute it to their shareholders, in the case of a company, or put it in their own pockets if they are private one-man businesses or partnerships. That is the issue.
The President can argue that what we are dealing with in the Bill and in the Clause is the enforcement of conditions in regard to the fixing of prices, but we must also take into account Clause 21, which gives to the manufacturer the right, not only to say that the retail prices which he stipulates shall be the prices charged in the traders' shops, but to tell the trader how he must distribute his profits. We think that that is bad.
I do not know what the general public would think about an issue like this if it were presented clearly to them, but I feel confident that they would say that any trader, particularly in the circumstances of today, who wanted to distribute some or the whole of his profits to his customers as rebates on purchases should be allowed to do so, and that the law should not put anything in the way of the trader doing precisely that.
We say that the Bill will put something in the way. I repeat, as it is the kernel of the whole argument, that it will give to the manufacturer the right to say, "I will refuse to supply you with goods if you distribute your profits to your customers and not to your shareholders". That is something which we cannot accept. As my hon. Friend the Member for East Ham, South (Mr. Oram) said, that goes to the whole basis of co-operative trading.
I do not want to appear rude about this matter, but the President was riding away from that issue, quite properly in the context of the Bill, on a legal argument that the Bill has nothing to do with that issue. He says that it does not go to the basic principle of co-operative trading. In the context of the Bill, in a very narrow legal way, that may be true, but in our view it does go to the basis of co-operative trading.
We may, in the House of Commons, if the vote is against us, have to concede, 1095 but outside the House we cannot and shall not agree that a Government in the twentieth century have the right to say that manufacturers can impose conditions of trade upon retailers by which the manufacturers can dictate the way in which a trader's profits shall be distributed. This goes to the whole basis and principle of the Co-operative movement, which was started in this country and has been built up and become the accepted method of trading for many hundreds of millions of people throughout the world. Here is an attack upon that basis and principle, and we hope that the President will think again about his attitude to the Amendment.
§ Mr. SimonI think that hon. Members on this side would respond gladly to the approach that was made by the hon. Member for East Ham, South (Mr. Oram). We certainly agree with what he and the hon. Member for Hillsborough (Mr. G. Darling) said about the social purposes of the Co-operative movement. In fact, I think we would go further; for we would say that the Co-operative movement has a valuable and, some of us would say, essential part to play in a free economic society. We do not see how it can play the same sort of part in a completely planned economy. These, however, are large issues which, obviously, fall outside the scope of the Amendment, and it would not be proper to pursue them further. I have said that, however, so that hon. Members opposite should appreciate that we on this side are certainly no less tenacious than they are as to the rights and the prosperity of the Co-operative movement.
Where we cannot follow is when the hon. Member for Hillsborough says that the Bill gives to the manufacturer a right to dictate how the co-operatives shall distribute their profits. There are two things to be said. First, the Bill gives manufacturers no such right whatever. I should have thought that it left the Co-operative societies rather better off than before the Bill, because the whole apparatus of collective enforcement is to be dismantled.
The matter, however, goes further. This is not a question of profit. We have had this argument before with reference to the revenue laws. It has been argued by many people, both inside the House and outside, 1096 that the co-operative dividend should be taxed because it was a profit. We have always resisted that contention, and hon. Members opposite have quite rightly resisted it, because the argument put forward by all of us was that it was not a profit to be taxed, but a trade rebate. It is because it is a trade rebate that it falls precisely within the manufacurer's right to control how rebates should be given on these goods.
We are not dealing with the question of individual resale price maintenance as a principle, Obviously, opinions differ on both sides, and I myself, as I said on an earlier Amendment, am not by any means sold on the argument of the loss-leader. But once it is accepted that a manufacturer has the right to control the price at which his goods will be resold, it follows that he has a right to control rebates. That is why it is wrong in our view that the co-operatives should be singled out in this respect.
§ Mr. Joseph Reeves (Greenwich)If the hon. and learned Member thinks that rebates ought not to be taken into consideration, how would he treat savings which have resulted from associated trading?
§ Mr. SimonI did not say that rebates should not be taken into account. My argument was precisely the opposite. It was that the manufacturer has the right, or we have conceded it to him as a basis of the Clause, to control the rebates which shall be given on his goods because that affects the price at which they shall be resold. It is for that reason that, apart from the very narrow terms generally of the Amendment, I shall find myself unable to support it.
I appreciate that my Amendments have not been selected but perhaps I can say, without infringing the rules of order, that I could not in any case accept any provision of this kind which did not apply to all the transactions between a trader and the customer. That was a rider that the Lloyd Jacob Committee made in paragraph 106. I know that the hon. Member for East Ham, South quite fairly met that point, even though, as it transpired, he was out of order in doing so; but if there is selection as to what goods shall be the subject of a dividend, as there is with many traders, including many co-operative societies, it obviously 1097 falls outside the scope of any recommendation of the Lloyd Jacob Committee.
It is for those rather more general reasons, because it is not a distribution of profit but a trade rebate which is in question, and because we have conceded the right of the manufacturer to control the price of his goods, that I respectfully agree that the Amendment falls outside the scope of the Bill. With all good will to the Co-operative movement, we feel that this is not a suitable opportunity to deal with the matter.
§ Mr. W. T. WilliamsThe President of the Board of Trade said that the Bill does not concern itself with the method of price fixing and the enforcing of price fixing, and does not in any way alter the right of manufacturers to fix prices. By making that comment he was successfully riding away from the real problem with which we are concerned. I have an interest in this matter, being a co-operative member, but my interest is not cribbed or cabined by that fact. My concern with the Amendment is a good deal wider than my narrow interest in the Co-operative movement.
The Minister is correct when he says that the Bill is not primarily concerned with the matters that have been advanced from this side of the Committee in favour of the Amendment. However, Clauses 20 and 21 are concerned with more than the things that the Government and the Minister want to achieve. They are concerned also with many exceptions and things which the Government do not want. Clearly, if the Government are to make an exception in the case, in particular, of the Co-operative movement, it applies equally to all societies protected by the Industrial and Provident Societies Acts.
The Minister and the Committee should consider some rather fundamental questions about resale price maintenance, the enforcement of resale price covenants, and the significance of the fact that the Co-operative movement and provident societies generally claim some privilege at the hand of the Minister.
Before I go into that, I would say that it appears to me that the effect of the Clause and of the Bill generally upon the trade of industrial and provident societies will be harmful. It is true that, in regard to the dismantling of collective enforcements, the co-operatives—perhaps the Minister will permit me to use 1098 that term; I mean it to include all industrial and provident societies—are somewhat better off in that they are enabled to escape the disadvantages of collective boycott, condition sales and private agreements about supplies.
On the other hand, they are greatly at a disadvantage in the sense that many manufacturers who hitherto have not felt it of sufficient interest to them to belong to trade associations, who have not joined any collective boycott and who are unwilling to join any of these massive forms of retaliation, will find that the possibility of applying a sanction by obtaining an injunction is a cheap and easy method of restricting co-operative trade. It is the existence of that sanction that puts the co-operatives in particular in a very worse position now in respect of a greatly widened area of supply compared with the position in which they were before this Bill came forward.
7.45 p.m.
For that reason, we urge upon the Government that it is right to claim for industrial and provident societies generally the protection which would be afforded them by the provisions of the Amendment. I am persuaded—I know I should be out of order if I were to pursue the matter—that the hon. and learned Member for Middlesbrough, West (Mr. Simon) is wrong when he sweeps aside the other claims of the Co-operative movement merely by saying that cooperative dividend should be exempt from Profits Tax and the like because the discount or dividend which is enjoyed by its members is merely a trade rebate.
However that may be, I am equally persuaded that it is tremendously important that when the Minister considers whether the co-operatives ought to enjoy some privileged position or some protection as is provided by the Amendment, he should consider, first, the purpose of resale price maintenance in general, and the protection that Governments hitherto have always felt it proper to give to industrial and provident societies. He should also ask himself whether the Amendment, without at the same time doing real injury to manufacturers and other traders, protects and serves the public interest to a greater degree than would be the case if it were defeated. It is to these matters that I 1099 should like for a few moments to direct the attention of the Committee.
I have always understood that the purpose of resale price maintenance was, in particular, to prevent injury to traders and manufacturers by unscrupulous people using branded goods upon which a great deal of research has been done. I am equally persuaded that the object of all the Industrial and Provident Societies Acts extending over half a century was to enablebona fideprovident societies, which were regarded as socially useful, and worthy of being promoted and encouraged by legislation, to be given special and protective privileges as against the generality of traders because they were regarded as socially useful and desirable. It is important that no opportunity should be neglected by any Government of continuing that principle and policy. It is right that the Bill should continue the policy.
The Minister and the Government are refusing to recognise that fact. I know that the Minister does not agree with this view, but I am asking him to think about it. The Government are riding away from the obligation to continue the policy embodied in the Industrial and Provident Societies Acts. The President says that the Bill does not alter the situation. He must realise that it materially alters the situation because it makes very serious inroads into co-operative supplies and the freedom of co-operative societies to pay dividends on a very wide range of goods. What the Minister is doing is to turn his back upon the general procedure and the protection given to industrial and provident societies which has always consistently been given by all preceding Governments.
It cannot be doubted that the effect of this refusal of the Minister to agree to the Amendment will be to injure cooperative trade, with the consequent effects upon the co-operative societies generally of which my hon. Friends have spoken. In my view, that has been done contrary to the public interest. It cannot be held—it has not been held by the Lloyd Jacob Committee, by the Monopolies and Restrictive Practices Commission, or by anyone who has taken the trouble to inquire into these matters—that by protecting the consumers in the Co-operative movement by 1100 such an Amendment as this, which could easily be put into the Bill, it would cause injury to manufacturers or other traders.
In those circumstances, I urge the Minister, even now, to reconsider the position which he has taken up, and I ask him whether, fundamentally, the attitude that he is adopting in respect of co-operative societies in this matter will not ultimately be injurious to the public interest, and will not serve the best interests of the country.
§ Mr. Philip BellAt the risk of being thought old-fashioned, I invite the Committee to look at the Amendment. We are not discussing whether the co-operative societies are altogether out of this world and beautiful. I think they are quite beautiful and that some of their advocates are persuasive and almost beautiful as well. But we are not really discussing whether there is a penal or savage attack being made on the cooperative societies. Hon. Gentlemen might have helped some of their hon. Friends, who, perhaps, have not their Notice Papers with them, to see what the Amendment says.
The Amendment asks for nothing except to construe an agreement. Of course, it is rather long, so I shall read only a brief extract:
The granting by a society… of any…dividend… shall not be treated as a breach of a condition as to the price…That is all that is being asked. There is a great deal of force in the suggestion that dividends should be treated differently.Now let us assume that the Amendment is accepted. There is the law. What happens? Some people do not mind about that law. As we see from the Report of the Monopolies Commission, the persons who supply groceries and chocolate do not take any account of that dividend so they do not mind about the law. Nor do the people who supply tobacco goods or electric lamps. [An HON. MEMBER: "Where is that?"] In paragraph 128. They do not mind about that, so that some of the people who supply goods to co-operative societies now do not bother about the dividend. They say that it is not taken into account and they do not regard it as a breach of condition. So far, so good.
1101 However, there are some obstinate suppliers, for instance, the pharmacists and booksellers. Whether they are right or wrong has nothing to do with this Amendment, so I shall not go into the merits of it. Those gigantic people say that any payment of dividend would be treated as a breach and must be added to the retail price. It may be wicked, it may be most tyrannical, but those are the terms they make.
I am not saying that they are good or fair terms, but under the law as it stands now, the man who makes goods can say, for good or evil, "I will attach this price limit and I shall not make the stinking things at all if I cannot sell them in that way." So, for good or evil, he makes those terms, and the only way to stop that is to say that nobody can make a contract or that every contract for sale must be subject to scrutiny.
§ Mr. G. DarlingNot to interfere with the argument, but to keep the record straight, may I point out to the hon. and learned Gentleman that the booksellers have withdrawn discrimination against co-operative societies?
§ Mr. DarlingFollowing that report, they put this right.
§ Mr. BellI am much obliged. Then, suppose there is only that one firm which says. "We will not deal with the co-ops unless they add on the price", what will this Amendment do about it? Will it say, "You must supply them?" It does not even say, "It is criminal if you do not supply them "or," It is criminal if you put in the provision ". The fact is that even if we accept this Amendment we shall still not make the person who insists upon the retail price being added in do anything about it. He will merely say, "If you do not agree, I shall not supply you with the goods".
§ Mr. Arthur Moyle (Oldbury and Halesowen)Granted all that the hon. and learned Member says is correct, does he not agree with the contention that, if this Bill is passed as it stands, it will put into the hands of some of these suppliers a legal instrument which they do not now possess?
§ Mr. BellI do not think that it puts any power into their hands. As the law 1102 stands now, if a co-operative society said that it would sell at a certain price whereas, in fact, it sold under that price because it paid the rebate—
§ Mr. MoyleI am grateful to the hon. and learned Gentleman for giving way again. I was influenced very much by the speech by the hon. and learned Gentleman the Member for Middlesbrough, West (Mr. Simon). As I understood. the hon. and learned Gentleman contended that if the dividend is described as a trade rebate it will place in the hands of the supplier the instrument which we contend is conferred upon him.
§ Mr. BellWith respect, I do not think that that affects the point I am making. The supplier need not call it a rebate and he can say to the co-operative store, because it is a free contract, "I want razor blades sold on your counter at 2s. a dozen. if you give the purchaser a ticket which entitles him to 2d., you must sell them at 2s. 2d." He need not use the phrase "price maintenance"; he can put it in ordinary language. I am not saying whether it is right or wrong. All I am pointing out to the Committee is that, whether it be right or wrong, this Amendment will not protect the cooperative societies any more than the present position does.
With respect to the hon. Member for Barons Court (Mr. W. T. Williams), who spoke of my right hon. Friend as if he were leading a savage attack on the co-ops, it is an extravagant way of talking. This Amendment merely states that a particular thing would not be a breach of an agreement. It cannot force anybody to make an agreement, it does not say what happens if a man will not sell goods because he does not like the terms—
§ Mr. Coldrick (Bristol, North-East)Does the hon. and learned Gentleman appreciate that any manufacturer has the right to supply any organisation with goods or not? We are conceding to the manufacturer under this Bill the right to determine the price at which goods shall be sold. If this Amendment is accepted we shall deny to the manufacturer the right to regard dividend as price reduction, and, therefore, he will be obliged to supply, or not to supply, on that specific condition.
§ Mr. BellThe hon. Gentleman is wrong on the first point. The Bill does not confer any right upon anybody. The law is that the private man can enforce his agreement. This part, supplying to the co-operative societies, remains as it is now. That is now part of the law. If this provision is effective at all the supplier will stop supplying. He will say, "I do not like this provision." With respect, I cannot see that this Amendment does anything more—I do not wish to be more rude than necessary—than provide a little cheap advertising for the Co-operative movement.
§ 8.00 p.m.
§ Mr. BeswickI must say that the courtesies of this Committee are very attractive. When my hon. Friend the Member for Hillsborough (Mr. G. Darling) corrected the hon. and learned Member for Bolton, East (Mr. Philip Bell) on one of the principal points of his argument, the hon. and learned Member said that he was obliged. In fact, he was most upset, because it knocked away the proposition that he was trying to put forward. When the President of the Board of Trade prefaced his argument by saying that he was not out to attack the Co-operative movement, we sensed at once that the right hon. Gentleman was not intending to accept the Amendment.
The hon. and learned Member for Middlesbrough, West (Mr. Simon) was a much more subtle opponent of the Cooperative movement. He brought forward his Morton's fork. He said, "If I cannot catch you on the dividend as profit, from the Inland Revenue angle, I shall catch you on the other prong if you insist that the deferred rebate is, in fact, a form of price cutting. The contradiction which the hon. and learned Gentleman put forward is embodied in the contradiction which has been running through some of the speeches of the President of the Board of Trade. The right hon. Gentleman has made it clear in some of his arguments that what he wished to do is to find a method of cutting prices. He said that quite plainly. He said that we do not want to keep up prices; we do not want to advance prices; what we desire to do is to bring prices down. And, of course, that has been the argument of the 1104 Conservative Party at successive General Elections.
What the right hon. Gentleman also said at other times is that we are all agreed that we do not wish to bring prices down by methods which upset the stability of trade. We do not want to bring down prices by methods which will lower the conditions of work in the retail trade. We do not want the sort of vicious practice to which many hon. Members have referred, such as loss-leading. We do not want that kind of reduction of prices.
In the co-operative form of trading we find a possibility of reducing the cost of living without all the dangers and abuses which this Clause enables the manufacturer to stop if he is so minded. The question arises: which of the apparently contradictory elements do we wish to support? What we want is to enable a form of efficient trading to be carried on without the kind of threat which is posed by this Clause. The hon. and learned Member for Bolton, East, says that there is nothing new about the Clause. Of course there is something new. This Clause will give a power to the manufacturer to prevent a co-operative society from paying a dividend on the goods which it manufactures.
§ Mr. Philip BellNo.
§ Mr. BeswickOf course it will.
§ Mr. BellWith respect, it is the contract which the manufacturer makes which prevents the Co-operative movement from doing anything.
§ Mr. BeswickAs a matter of fact, there is a new and different element in this Bill. It gives a legal sanction to the manufacturer which he did not previously have. Life in this field is not quite so clear-cut as the hon. and learned Gentleman would have us believe. It is not the fact that we have two different categories of manufacturers; one prepared to trade with the Co-operative movement and not worrying about a dividend, and the other—there is a decreasing number in this category—who says, "We will not supply the Cooperative movement because it gives a dividend."
The fact is that there are a number of manufacturers who now supply the Co-operative movement, because it is difficult to enforce a contract. In fact, there are 1105 no written contracts, in the main, as between supplier and retailer in the great majority of trades. The fact that there is no legal sanction means that there is great difficulty in drawing up a legal contract. Once the power is given to the manufacturer legally to enforce a written or a non-written contract, we shall begin to introduce an element which is quite fresh and we shall be encouraging discrimination against the Co-operative movement.
Something was said earlier about the unwisdom—the President used this argument—of encouraging retailers to band together to enforce prices. Strangely enough, that kind of thing could be encouraged by the power now being given to the manufacturer. The retailers might say to a manufacturer, "We object to you supplying the co-operative society in the town." It is not unknown today. But a manufacturer can say, quite honestly," It is very difficult for me, because there are no legal sanctions open to me. There are ways and means for the co-operative society to get my products and, therefore, I do not feel that I can enforce it." Or the manufacturer may well say, "We supply the co-operative societies and what they do afterwards is not our business."
If this Bill becomes law, the retailers can say to the manufacturer," It is your business. You can enforce your conditions. A legal sanction has been given you by Parliament."
§ Mr. Philip Bellindicated dissent.
§ Mr. BeswickIt is no use the hon. and learned Member shaking his head. It is written into the Bill. A legal sanction is to be given to the manufacturer who, previously, was not able to sue, and I think that is a retrograde step.
The President must answer this question. Does he, or does he not, wish to give power to the manufacturer to discriminate against this form of trading? That is the issue. Does the right hon. Gentleman differentiate between the co-operative form of trading and the sort of cut-price trading we had in the 1930s? Does he accept the argument of the Lloyd Jacob Committee that there is a difference between the deferred rebate and the plain common or garden loss-leading or other forms of cut-price trading? If the right hon. Gentleman 1106 accepts the difference, I suggest that there is a necessity to write into this Bill an Amendment which reflects that view.
I hope that the right hon. Gentleman will have another look at this. He has said that he does not wish to harm or damage the Co-operative movement, but he is making it possible for manufacturers to harm the movement, and I beg him to reconsider the matter.
§ Mr. Turner-SamuelsI am sure that there is a good deal of misapprehension, both about the effect of the Bill in general, and about this Clause in particular, in relation to the question of Co-operative societies' dividends. I am sure that the President will take it kindly when I say that I think the misapprehension has arisen because the right hon. Gentleman has not made as clear as he should have done what the real effect of the Clause will be.
The whole object of the Amendment which we are discussing is to prevent an interference by the provisions of the Bill by adding something to what is the present situation, regarding dividends paid by the Co-operative movement. I say at once that if I thought that the Bill, or the Clause, was in any way undermining the present position of the Co-operative societies in regard to dividends, I should say so and fight it strongly. After all, the city of Gloucester is a strong co-operative centre, and my constituents include many members of the Co-operative movement. Therefore obviously I would wish to keep their interests well in mind.
When I put the question to him, I was surprised to hear the President say that co-operative dividends, in some way which he did not explain, would be caught by the Bill. I want the President to follow my observations on this point because I do not think he has done justice to his case. If he will follow me, perhaps he will be able to see what the position is. First, I think the ground ought to be cleared about the meaning of the term "dividend" here. The hon. and learned Member for Middlesbrough, West (Mr. Simon) got the position quite wrong. It is true that the Amendment uses the words "dividend" and "discount", but I should have thought it correct, in this context, to say that those words are most inapt to describe what applies in connection with the co-operative dividend.
1107 The co-operative dividend is not a price reduction at all. As a result of the society's trading a surplus ensues, and it is that surplus which is distributed under the name of a dividend to the members of the particular society concerned. The question resolves itself purely into whether that form of dividend will be caught by the provisions of this Measure. There is no room here for any discussion of the question raised earlier as to whether those dividends ought to be taxed or not. That is an entirely different question, which has nothing to do with the question involved here. The material question here is whether that dividend as a dividend is to be caught by this Bill.
I want the President to notice—I am sure that in this he will agree with me—that this Clause deals exclusively with the sale of goods. It does not deal with dividends at all. Let us try to get this clear; it is very essential to do so. It is perfectly plain, on any interpretation of the wording of the Clause, that it does not touch in any way whatsoever the question of dividends. I challenge anyone to prove the contrary.
What the Clause does is to say quite plainly that where goods are sold
by a supplier subject to a condition as to the price at which those goods may be resold, either generally or by or to a specified class or person, that condition may, subject.…The Clause concerns the price at which those goods are sold and has nothing at all to do with the society's surplus which eventually emerges and is used for the purpose of being distributed to the members of the society in the form of a dividend.In those circumstances, I wish to refer to the argument expounded by the President of the Board of Trade when he was stating what the effect of Clause 19 and Clause 20 would be. He quite rightly said that Clause 19 deals with collective enforcement, and by virtue of that Clause the whole pre-existing structure of collective enforcement will have gone. Therefore, any question of attacking the dividend in any way by means of collective enforcement could not, under the Bill, apply. The only other possible way, it is argued, of attacking the dividend is under the form of individual enforcement provided by Clause 20. It is because it is contended the dividend comes under 1108 Clause 20, that the present Amendment seeks to avoid that effect.
Under Clause 20, however, it is perfectly clear, in my submission, that the dividend cannot possibly be attacked. That Clause can only attack the resale price at which any particular goods are being sold. That is the only condition which the supplier can lay down and enforce by virtue of that Clause. If the goods are to be sold by the retailer the only condition which the supplier can lay down is the condition as to resale price. That, therefore, excludes any other condition whatever; it is as strong as that. It accordingly clearly excludes any attempt to deal with, or to affect, or undermine, or alter the rights of the Co-operative society in regard to the payment of dividends.
§ Mr. BeswickWill my hon. and learned Friend bear in mind that the President of the Board of Trade, who is not unfamiliar with this Clause, has assured the Committee to the contrary?
§ Mr. Turner-SamuelsAt the beginning of my speech I explained that I did not think the President had done justice to his case. I disagree with the view of my hon. Friend the Member for Uxbridge (Mr. Beswick) if he thinks that what the President said is correct. I think that the President ought to take steps now to correct the impression which he gave the Committee, because I am quite certain that it was a wrong one.
8.15 p.m.
Invariably the President deals with these points when they are raised, and I am sure that he will deal with this one and be candid enough to say whether he thinks that my view is correct or whether he still contends that his view is correct. Assuming that my contention is correct—that under Clause 19 the co-operative society's dividends cannot possibly be attacked because the whole machinery of collective enforcement falls to the ground under the provisions of that Clause, then, assuming I am equally right that under Clause 20—the Clause which gives the right of individual enforcement—relates merely to a condition regulating resale price, then, it follows that it cannot extend to any question relating to the payment of dividends.
I think that there has been a good deal of misapprehension, and I agree with the 1109 hon. and learned Member for Bolton, East (Mr. Philip Bell) on the question of legal sanction. My hon. Friend the Member for Uxbridge thought the Bill expressly conferred some legal sanction in the direction of affecting the payment of dividends. My submission to the Committee is that it does nothing of the sort. If it is still argued that it does, then I should like someone to point out where, in the Bill, particularly in this Clause, any such legal sanction is given.
§ Mr. A. J. Irvine (Liverpool, Edge Hill)Clause 21.
§ Mr. Turner-SamuelsI am dealing with Clause 20.
Clause 21 has nothing to do with this point about the payment of co-operative dividends. In these circumstances, I ask the President what he now has to say about the position, and whether he thinks my view of it is correct or not.
§ Mr. Robert Edwards (Bilston)Listening to this debate, it seems to me that in this Chamber from time to time black can become white and white can become black. We have heard speeches from hon. Members opposite declaring their sympathy with the great social experiment of co-operation, yet, although the President states precisely and very clearly that the Clause will enable certain anti-social practices against 11 million consumers of this country to become legalised—although that is admitted and in spite of hon. Members on the benches opposite talking about their sympathy with that movement—hon. Members opposite will refuse to accept the Amendment, and will go into the Lobby against it.
As honest people, we can only assume that, fundamentally, hon. Members opposite are on the side of big business against this movement, which essentially is a workers' movement. I want to declare my interest. I am an active member of the Co-operative movement, and I have a very deep emotional interest in the movement because, 97 years ago, a forbear of mine in Lancashire started the first co-operative bakery in this country. I hope that the Committee will forgive me for mentioning that, but it touches the very crux of the conflict between both sides of the Committee.
This forebear of mine started work—heavy, hard work—at five o'clock in the 1110 morning. He went to the bakery at four o'clock in the morning to bake fresh bread for the villagers, walked six miles to his work in a quarry and afterwards came back, and with his wife distributed the bread, so that that little village in Lancashire could get fresh, good, wholesome bread, which was not provided before. He did not make any money out of it, but he put his whole life into it. It was men and women like that who started this movement, which has now 11 million members in Britain and hundreds of millions of members all over the world. It is one of the greatest examples of social welfare and dedicated social activity in the history of the world.
It is something which the country and the House should be proud of. Any Bill which commences to undermine that great British contribution to the world has to be challenged, and any Government and any Minister who dares to set machinery in motion which is likely to weaken that great movement is doing a disservice to the nation now and a disservice to children as yet unborn. That is why this is a very serious Clause.
Let us look at what is happening now. More than thirty years ago, a Government Commission on restrictive practices complained and wrote down clearly for all to read that existing practices against the Co-operative movement should be abolished. That was thirty years ago. Every Commission which has dealt with this subject that we are discussing this evening, every Commission, allow me to emphasise, under the control of this House, has also declared that there are restrictions against the Co-operative movement which should be abolished.
The Co-operative movement, as my hon. Friend the Member for East Ham, South (Mr. Oram) has already stated, cannot buy certain workmen's tools. The Royal Arsenal Co-operative Society bought a corner shop—a bicycle shop. It paid goodwill for that shop. As soon as it became a co-operative bicycle shop, the supply of bicycles was stopped. Is not that a crime against the 800,000 consumers of the Royal Arsenal? Are they not entitled to some protection? They get no protection in this Bill. Now that kind of restriction and boycott against the consumers is being legalised. It is another sanction. Now all kinds of restrictive 1111 practices can be applied against the Co-operative movement, and those engaged in them can go to the courts to justify them.
Not long ago, the Luton Co-operative Society bought a little newspaper round which had 173 customers, all members of the co-op. Within two months, all its newspaper supplies were stopped by the wholesalers. It was not paying dividend on its papers and periodicals, but it was stopped on principle because certain people in this country, who are now to get the protection of this Bill and the protection of this House, would not trade with the Co-operative movement at all, whether it paid dividends or not. They want to destroy the movement because it represents the ideals of working men and women combining together to create common ownership, which is a mighty, progressive thing.
Let us see just what will happen. This is why we are entitled to get from the President concrete answers to the points raised in this debate. I have here a letter from a manufacturer of workmen's tools to a co-operative society. Here is what we are going to legalise. The letter says:
This will acknowledge your letter from which we note with regret that you are unable to enter into an undertaking not to pay dividend in respect of certain tools.These tools were not sent any more, and they cannot be sold to workmen who are members of the co-operative society. Is it true or is it false that this kind of practice can now be legalised, and that if the co-operative society gets tools, this manufacturer can sue the society in the courts, with the result that hundreds of thousands of pounds may have to be spent in litigation?Another example concerns gramophone records. The Decca Record Company writes to a co-operative society and says:
We thank you for your letter of the 13th instant but regret to inform you that we cannot supply you with our records as our policy is not to trade with co-operative societies.I am suggesting that in this Bill cooperative societies should have been protected against these practices; that they get no protection against them; on the contrary, under this Clause, these practices which are now isolated can be made general. That is a very serious business.1112 I have here letters about toys, Meccano, records and a whole range of requirements essential to working people today, such as electrical appliances, which cannot be sold by the Co-operative movement in this country. The President, we suggest, should tell us plainly, without all the smiles and sweet reasonableness, what he feels about the Co-operative movement. We are entitled to ask him, is it true or is it not that the practices imposed on the Co-operative movement, and mentioned by my hon. Friends and myself, receive the sanction of the law under the Bill? If that is not so, we shall be glad to hear it said. If it is so and if hon. Members pass the Clause and vote against the Amendment they ought to be ashamed of themselves.
§ 8.30 p.m.
§ Mr. P. ThorneycroftWe have had a fairly long debate on this matter, in which the arguments have been very fully and perfectly fairly put on both sides of the Committee. We have a long way to go on the Bill. I think there is an honest difference here which should be carried, in the proper way, to a Division. It is, I may be able to persuade the hon. Member for Bilston (Mr. R. Edwards), a little narrower than he might imagine. So far from the collective boycott being legalised, it is made unlawful by the Bill.
§ Mr. R. EdwardsThese arrangements are not collective.
§ Mr. ThorneycroftI am not suggesting that everything is satisfactory from his point of view, but to that extent the position of the co-operative societies has substantially improved, as I think they themselves, in honest argument would fairly admit.
No new right is given. The rights are exactly the same as exist today. But it is true to say that there is a new method of enforcing a right. Hon. Members are perfectly entitled to say that there ought not to be that new method of enforcing the right, and to carry that opinion into the Division Lobby, but I have explained why, in the wider context of the Bill, we have included the new right, the position has been widely covered, I have tried to co-operate with the Committee as far as possible, and I hope that we may now reach a decision.
§ Mr. MoyleMay I put a question to the right hon. Gentleman before he sits down? It is a point which I should have made in my speech had I been able to make my speech.
Having regard to Clause 21 (1) and the speech of the hon. and learned Member for Middlesbrough, West (Mr. Simon), does the right hon. Gentleman agree that a co-operative dividend, for the purpose of the Bill, will be described as a trade rebate? If that is so, does it not place in the hands of the suppliers of goods the right to go to court and to state that the action taken by a local co-operative society in declaring a dividend, no matter how much or how little, is breaking the law? If they were to get a decision, would it not involve the cooperative societies in very large legal costs—more than they could possibly sustain?
§ Mr. ThorneycroftI shall not debate the technical point whether it is a rebate or a profit. I want to answer fairly the point put to me. The point is not whether technically, the dividend is a rebate or a profit, It is that the supplier today can treat a dividend or a discount, whether by the Co-operative movement or by anybody else, as price cutting. He will be able to do that after the Bill has been introduced. The position will be unaltered. But the method of enforcement will be altered; some say for the better, some say for the worse—and that is a matter for a Division. That is the only alteration in the arrangement.
§ Mr. JayThis issue is of first-class importance to the whole Co-operative movement, and I do not think we can possibly have the debate rushed or the subject inadequately discussed. I will therefore make one or two comments on the two speeches which the President has already made on the Amendment.
In the first place, he admits quite frankly that under the Clause it is possible for the manufacturer to treat the co-operative dividend as being a discount or price rebate, in spite of what was said by my hon. and learned Friend the Member for Gloucester (Mr. Turner-Samuels) and the hon. and learned Member for Bolton, East (Mr. Philip Bell); I accept the President's interpretation of the law on that issue, and not theirs.
1114 Secondly, it is also clear that the President is asking us, under the Clause, to give the manufacturer legal power to enforce in the courts, as he could not do before, his interpretation of what the dividend is. I think that the President was rather below his usual level of logical argument when he said in both speeches that the point was that if we took Clauses 19 and 20 together, it was arguable that the Co-operative movement might perhaps be better off after the Bill than it was before the Bill. That really is not the issue. The issue is that Parliament is being asked to give a new legal sanction to manufacturers to enforce their prices on the co-operative societies in this fashion. That is what we really have to decide.
The case from this side was put in an extremely moderate way. My hon. Friend the Member for East Ham, South (Mr. Oram), in moving the Amendment, made it perfectly clear that we are not asking for any special privilege for the Cooperative movement as such. I should be willing to accept all the Amendments of the hon. and learned Member for Middlesbrough, West (Mr. Simon)—who has left us—and would at any rate wish to make it perfectly clear that similar but not identical organisations such as agricultural co-operative societies and anybody who traded in this fashion should, of course, be included in the concession which we seek to make.
I do not think that the main issue is whether the co-operative society is a generally socially desirable thing. I believe that it is, as do many hon. Members on both sides of the Committee. The real essence of the argument is that the Co-operative dividend is not, in the ordinary sense, a price cut as is meant by these two Clauses. The co-op does not pay a dividend because it wishes to make a cut in the price of the particular type of goods. It pays the dividend because that is part of its general system of trading. Dividend is paid irrespective of whether the electric lamp, the cigarettes or whatever it may be are sold at this price or at that. That seems to me to constitute a real difference in substance.
Secondly, as has already been pointed out, it is not a cut made at the time at which the goods are sold. It is made at a later date and is for that reason described as a deferred rebate. I shall 1115 not enter into the interesting economic controversy as to whether this discount should be regarded as a change in price or a distribution of profit. I do not think that it is strictly relevant, but I do think that the private manufacturer should not be allowed to enforce his particular answer to that abstruse question by legal powers in the courts, which is what the President seems to be asking us to do.
There are these two additional reasons. I gather now that the publishers have accepted the distinction which I have made and now agree that there is a complete difference between the system of dividends and a straight price cut on the individual article. Again, the Lloyd Jacob Committee accepted the fact that the co-ops were in a particular situation and should be treated exceptionally—not so much the co-ops but that anybody who traded in that way should be treated exceptionally for purposes of resale price maintenance.
The remarkable thing is that the President is going out of his way both in Clause 20 and in Clause 21 to make it perfectly clear that manufacturers can treat the dividend as a discount and can, in effect, discriminate against the Co-operative movement. Clause 20 (1) says that
Where goods are sold by a supplier subject to a condition as to the price at which those goods may be resold, either generally or by or to a specified class or person,…That, of course, makes it possible to act in the way I have described.Clause 21 (1), of course, makes it as plain as could be, even to us non-lawyers, that under the Bill the dividend can be treated as a price discount. For all those reasons I think that the President is really making a very grave mistake in refusing to make any concession to all that has been said by my hon. Friends. As I say, he has made two speeches already, but we should not mind him making a third if he would make it in that sense, and I would advise him seriously to think again on this issue.
The reality and the substance of it is that, whatever the exact and correct legal interpretation may be, this is discrimination against the Co-operative movement, and, in the unanimous opinion of that movement, it is going to do it grave damage. If that is so, I think that the 1116 President would be well advised to think again. If he cannot do so now, he could do so before the Report stage, but if he is unable to give us any further satisfaction at present, I think we ought to carry this matter forthwith to a Division.
§ Sir H. LinsteadWould the right hon. Gentleman answer this question? Does he or not take the view that an individual manufacturer should be free to refuse to have his goods sold through a co-operative society, if he so desires?
§ Mr. JayI should have thought that it is perfectly plain to everybody that if a manufacturer does not wish to have his goods sold through a particular channel, neither Parliament nor anyone else can compel him to do so.
§ The Temporary ChairmanThat question does not concern the Amendment.
§ Mr. ColdrickThe President of the Board of Trade has been excessively timid in his attitude towards this problem. He will know perfectly well that in this Committee we are not speaking on behalf of the political section of the Co-operative movement, because I myself have been a member of deputations, representing the trading side, which have expressed the concern which is felt by the whole of the people employed in the trade.
The President, by this Amendment, has the opportunity of declaring whether he himself and the Government consider the payment of a dividend to be price cutting. He himself will not make a declaration upon that issue. He says that the matter remains precisely as it was before the Bill was drawn up, but is it not obvious that, by this so-called neutral attitude on his part and that of the Government, this is a deliberate encouragement to the private manufacturer to use legal powers in order to enforce price maintenance, and that precisely to the extent that that is done the position of the Co-operative movement will be infinitely worse in the future than it is at present?
Let us make it quite clear that all through the period of the war, and for some time afterwards, there was price-fixing by the Government but no one suggested that, when the Co-operative movement sold goods at prices which had been fixed by the Government and returned a surplus in the form of a dividend, that fact was to be construed as 1117 price cutting. I submit that, since both Conservative, Labour and Coalition Governments have been prepared to recognise the right of the Co-operative movement to charge the prices that were laid down and then distribute the surplus as a rebate, this has never been regarded as price cutting, and that we should never concede that right to the private manufacturer.
Consequently, it seems to me to be a form of moral cowardice to grant a legal sanction to an immoral practice on the part of a manufacturer. I am asking for no privileges for the Co-operative movement, because we never ask for privileges. This is a favour which, we believe, should be conferred on all—to have the right to share a surplus if they feel disposed to share it. For these reasons, I would appeal not only to the President of the Board of Trade, but also to the public to make it impossible to operate such an iniquitous Act as this Bill will prove to be.
§ 8.45 p.m.
§ Mr. P. ThorneycroftI appeal to the Committee. I have tried to be as fair as possible in answering all the points that have been made. We have had a very long debate and we have a long way to go still. I have frankly conceded that there is a difference. It is nothing to do with the point about the manufacturer keeping goods back. I concede that that is an irrelevancy and has nothing to do with this point. The point was clearly put by the right hon. Gentleman the Member for Battersea, North (Mr. Jay) that there is no difference of right here but there is a difference of method of enforcement, which has now been fully debated for a considerable time.
§ Mr. Norman Dodds (Erith and Crayford)The right hon. Gentleman has not answered the question.
Mr. ThorneyeroftI am prepared to answer the question and, indeed, I have done so. I would urge the Committee to come to a conclusion.
§ Sir L. Ungoed-ThomasThroughout the many days that we have been discussing the Bill we on this side of the Committee have tried to co-operate to our utmost with the greatest economy of time consistent with a thorough debate of the points involved. I am sure that 1118 the President of the Board of Trade fully recognises that fact.
Here we have an Amendment which is of the greatest importance to the Co-operative movement. On various occasions we have dealt with other parts of the Bill. For instance, we dealt with various Clauses at some length on Second Reading. This is the first and only opportunity when we have been debating a matter which affects so profundly the Co-operative movement.
I am sure the President of the Board of Trade will recognise at once that we deliberately desisted from debating at any length an earlier Amendment seeking to leave out a specified class of person because we wanted to deploy the whole of the co-operative case at one time. In fact, we withdrew the Amendment, although it was an important consideration. All of us on this side of the Committee wish, as we have done throughout, to deal with this Bill in a most businesslike manner, but we really cannot ask Members representing the Co-operative movement, on the one issue which profundly affects that movement, to desist from putting forward considerations which to them and to all of us are important. I cannot ask my hon. Friends to refrain from putting forward matters which are obviously most relevant to this Amendment.
There is no suggestion of being out of order or anything of that kind. I am sure the President of the Board of Trade recognises that. He will recognise, too, that a great deal of time on the Bill has been taken up, quite rightly—I am not gainsaying it—by hon. Members on his own side. That has been done on Clause 19, for instance, without any reference to any Amendment at all, and, therefore, could not have any relevance to the altering of the Bill, whereas this Amendment has.
I can assure the right hon. Gentleman, on behalf of all of us, that we wish to economise in time, as we have done throughout, but there should be an opportunity for those of us who wish to speak on this Amendment to put forward considerations with which we are concerned.
§ Mr. ThorneycroftI am not questioning the right of any hon. Member to speak. I recognise that hon. Members hold their views with absolute sincerity. All I was doing was to ask, as a Minister is entitled to do, that we should be as 1119 expeditious as possible because we have a long way to go yet before we complete the Committee stage of the Bill.
§ Mr. Ron Ledger (Romford)I am sure the President of the Board of Trade would not like, in so short a time, to undo the work of a hundred years, yet he is asking us to stop debating a Clause which affects the very basis of the Co-operative movement. I am not at all sure that if this matter should go to a Division, and the Amendment should be defeated, the right hon. Gentleman would find that all of his colleagues would be very pleased with him, because we are discussing, also, a very important method of saving.
The President seems to think that we are concerned here only with those who at present discriminate against the Co-operative movement. He says that the difference is that after the Bill has been passed they will have to find another way of discriminating; they will have to go to the courts.
The real cause for our worry—and I am sure the President will consider this—is that he is putting a weapon into the hands of those who at present supply the Co-operative movement and who appear to make no condition about dividend. I have spoken recently to a number of people who are suppliers to the Co-operative movement, who profoundly disagree with the dividend but who still supply the movement, for a number of reasons: the credit is good and they value the points of distribution which the Co-operative movement has. Immediately this Bill is passed, they will still be able to make the most of those advantages, but they will also be able to enforce price maintenance by taking co-ops to court and, possibly, preventing them from paying dividends.
Is the President absolutely certain that the Bill will not give to suppliers who, at the moment, do not discriminate, an opportunity and incentive to discriminate? Those who now supply the Co-operative movement, in spite of the dividend being paid, will still want to supply co-operative societies but will think that they can take them to court and see that no dividend is paid.
I am sure that the President and those who are not in the Co-operative movement will appreciate that the principle 1120 of thrift is of the utmost importance. We thought of it long before the Conservative Party thought of saving. Indeed, there are many people, old-age pensioners and others, who could not exist today if it were not for the fact that they had a dividend which had accumulated in the Co-operative movement. I want the President to assure the Committee that it would not be his intention to encourage suppliers to the Co-operative movement to take advantage of the Bill and to discriminate against the co-ops where they have not done so in the past.
§ Mr. DoddsIn my opinion, there are no new arguments to be deployed on this matter. I believe that when the President made his first speech today he was quite ignorant of the seriousness of the situation from the co-operative point of view. Such a thing is quite possible when people are not co-operators and have not studied the subject very deeply. I would, therefore, like to say just a few words in order to bring out a question which has not been answered, but which is of the utmost importance.
As the debate has continued, I have been satisfied that there is no new argument to advance; but one thing has clearly emerged, namely, that the President has closed his mind to whatever arguments will be put forward. In fact, he had made up his mind right from the beginning, and very definitely. It has been clearly indicated that whatever argument we can put forward, he will not change his view.
The President must know, because he has never denied it, that he is doing something now in attacking these very important principles which his predecessors would not have done. That is a new departure. He does not argue whether it is better or worse, but he admits that there is a difference here. It is a difference which the Co-operative movement, after fully examining it, knows is a serious one. Many people will be asking this question, and I would ask the President now whether he would stand up at the Dispatch Box and explain why, contrary to the policy of his predecessors, he is introducing this Measure which, as he must know, is an attack on the very principles of a movement which has tens of millions of people dependent upon it.
§ Mr. E. Fernyhough (Jarrow)We all appreciate the right hon. Gentleman's anxiety to get on with the Bill. As most of us are anxious to help him, I can tell him how to expedite the business. All he need do is accept the Amendment which will protect the Co-operative movement from the fears which many of us feel are justified.
It does not matter how hon. Members opposite pretend from time to time that they have no prejudice against the Co-operative movement, for when an issue of this kind arises they show their true colours. The Clause will put the movement at a distinct disadvantage. It will tend to move trade away from the co-ops to private distribution, and that is something which all hon. Gentlemen opposite want. They can never make us believe that they have any great love or admiration for the Co-operative movement.
The Minister is trying to support big business by strangling the co-ops. We all know that the Proprietary Articles Trade Association has from time to time stopped supplies of goods to the Co-operative movement because it pays dividends. The members of that association know that in all large retail establishments the employers allow concessions to the employees in the form of rebates on purchases. Employees of establishments, in London and elsewhere, can buy articles at a discount although the price has been fixed by the manufacturer, and it has never been known that any supplier has taken action to stop the sale of his goods at a discount.
On the other hand, because the co-ops give a dividend, not at the time of sale but some months later, covering all sales, the suppliers of the co-ops are to be able to step in and say that they shall no longer be supplied. It is dangerous for the future of Britain to do that. I remember what happened when the radio manufacturers decided not to supply the co-ops with radios. The Co-operative movement made its own. One of the things on which we want to cut down today, whether it be motor cars, radio or any other industry, is competition between manufacturers producing similar types of article. We want more mass production and longer runs. The Co-operative movement will not go without these articles. The right hon. Gentleman 1122 will drive the movement to building the necessary factories and attracting the manpower to make its own goods if it does not get supplies through the ordinary channels.
I therefore beg the right hon. Gentleman to leave aside his prejudices and recognise that 11 million people will be affected by the Clause. If suppliers take action there will be a great measure of inconvenience. I come from a small mining village, where the co-operative society provided the general stores. We got everything from there, and when suppliers refused supplies of patent medicines, Ovaltine, and so on, the people had to tramp for two miles to get what they looked upon as necessities. The Clause will encourage that kind of procedure. The President of the Board of Trade ought to have the grace to recognise the feeling that there is about this matter, cast aside his prejudice, do the right thing, and accept the Amendment and let us get on with the Bill.
§ 9.00 p.m.
§ Mr. MoyleI should like to respond to the appeal made by the President of the Board of Trade, but I feel so very strongly about this issue that I must again remind him of the position of the co-operative movement and place on record my own attitude to the Clause. I have been a co-operator all my life, but in the observations made from the benches opposite—and I do not except the President—I noted a great deal of ignorance displayed about the whole of the controversy on this Clause. For example, the hon. Member for Putney (Sir H. Linstead), in challenging my right hon. Friend the Member for Battersea. North (Mr. Jay), asked if my right hon. Friend objected to suppliers refusing to supply the Co-operative movement. Of course we do not.
The Co-operative movement has had to battle right through the years with private interests, supported by the Daily Express, which have maintained, with less success, of course, as time went on, their boycott of the supply of goods of all kinds to the Co-operative movement. That boycott is still being maintained by a number of manufacturing firms and wholesalers, as was indicated by my hon. Friend the Member for Bilston (Mr. R. Edwards). In a free society the Co-operative move 1123 ment can have no legal complaint against such action, but it is nevertheless an economic boycott practised by private interests at the expense of the Co-operative movement.
I can go to my local Co-operative society and buy Gillette razor blades, Player's cigarettes, or tobacco of almost any brand, and pay precisely the same price as I would pay to an ordinary retailer. The dividend that is declared by the local co-operative society is declared on the basis of its own local trading, and is not determined by the price of any particular product. It is a saving that is declared on the basis of the whole of its trading in a particular quarter of the year. It covers clothing, haberdashery and almost every kind of article.
As I said, there are organisations which still refuse to supply the co-operative societies. What will be the position if the Bill is passed as it stands? I beg the President of the Board of Trade to reflect upon it and to remember the recent experience of the Minister of Education. If the right hon. Gentleman really thinks that this controversy will be dismissed by a mere Division in the Committee tonight he is making the biggest mistake of his political life. The right hon. Gentleman does not realise what is coming to him if this Bill is passed unchanged and evokes once again the long-standing issues relating to the form of trading of the cooperative societies. So I ask the right hon. Gentleman to reflect seriously upon his attitude to this issue, and to make certain that what he decides before he leaves this Bill is the product of his own judgment and not that of his advisers.
I was influenced by the speech of the hon. and learned Member for Middlesbrough, West (Mr. Simon) in which he put the issue clearly to the President of the Board of Trade. The hon. and learned Gentleman said that the co-operative dividend was a trade rebate, and the President was enthusiastic, by the shake of his head, in endorsing that view—
§ Mr. MoyleNo. As a matter of fact the right hon. Gentleman has been cooing like a sucking dove all the evening. There was no trace of that when he was on this 1124 side of the House. The right hon. Gentleman has mellowed and become exceedingly tender, kindly and conciliatory during the more mature years of his political existence.
The President does not believe in the adage about letting sleeping dogs lie; for what the Bill does is to arouse sleeping dogs. Sleeping dogs have been lying around the co-operative societies for a long time—[HON. MEMBERS: "Hear, hear."] Even theDaily Expresshas allowed them to sleep. [Laughter.] I am talking about the capitalist dogs surrounding the British Co-operative movement. The Bill will place in the hands of every private supplier of goods or food or clothing to the Co-operative movement a legal case, an actionable case against the co-operative societies that will entitle them to go to the courts. Every lawyer will tell them that they have a case to argue. So they will go to the courts, and every little co-operative society will have to trail behind the lawyers and put up its case against a ruling coming from the courts which will be inimical to co-operative trading.
Therefore, I say to the President, "Do not think that this matter will be dismissed by a Division here this evening". The fight will go on outside the House, and I know that the Co-operative movement will win in the end.
§ Mr. W. T. Proctor (Eccles)This is a deliberate act on the part of the President of the Board of Trade to alter the law and to allow the prejudice against the Co-operative movement to operate. I appeal to the right hon. Gentleman to recognise that this kind of thing has been done in the past against the trade union movement. It had the effect of making the trade union movement ten thousand times more eager to enter politics than it was before.
I predict that hon. Gentlemen opposite, who are laughing so much tonight and who are so delighted by this deliberate action against the Co-operative movement, will live to regret it. They will do so because the 10 million members of the Co-operative movement throughout the country will recognise that we have here tonight a classic example of a deliberate act by the President of the Board of Trade and the Tory Party, whose only desire is to defeat this form of trading by a vote on the Amendment.
§ Mr. DoddsWill the Minister give an explanation for his action? [HON. MEMBERS: "Divide."] On a point of order, Mr. Blackburn, I did not go into the case. I told the Minister that he had not given a reason for his action.
§ The Temporary ChairmanThat is not a point of order.
§ Mr. FernyhoughI appeal to the Minister to look at this matter again to see whether, on Report, he cannot do
§ something. The right hon. Gentleman must appreciate that there is more opposition to this matter than he thought at first there would be. Having regard to the number of hon. Members who have spoken, and the issues involved, will the Minister look at it again and see what he can do on the Report stage?
§ Question put, That those words be there inserted:—
§ The Committee divided: Ayes 196, Noes 230.
1127| Division No. 174.] | AYES | [9.9 p.m. |
| Ainsley, J. W. | Grenfell, Rt. Hon. D. R. | Moyle, A. |
| Allaun, Frank (Salford, E.) | Grey, C. F. | Mulley, F. W. |
| Allen, Arthur (Bosworth) | Griffiths, David (Rother Valley) | Neal, Harold (Bolsover) |
| Allen, Scholefield (Crewe) | Griffiths, Rt. Hon. James (Llanelly) | Oliver, G. H. |
| Awberry, S. S. | Griffiths, William (Exchange) | Oram, A. E. |
| Bacon, Miss Alice | Grimond, J. | Orbach, M. |
| Baird, J. | Hale, Leslie | Oswald, T. |
| Bence, C. R. (Dunbartonshire, E.) | Hall, Rt. Hn. Glenvil (Colne Valley) | Owen, W. J. |
| Benson, G. | Hamilton, W. W. | Paget, R. T. |
| Beswick, F, | Hannan, W. | Paling, Rt. Hon. W. (Dearne Valley) |
| Blenkinsop, A. | Harrison, J. (Nottingham, N.) | Paling, Will T. (Dewsbury) |
| Blyton, W. R. | Hastings, S. | Parker, J. |
| Boardman, H. | Hayman, F. H. | Paton, J. |
| Bottomley, Rt. Hon. A. G. | Healey, Denis | Peart, T. F. |
| Bowden, H, W. (Leicester, S.W.) | Hobson, C. R. | Plummer, Sir Leslie |
| Bowles, F. G. | Holmes, Horace | Popplewell, E. |
| Boyd, T. C. | Holt, A, F. | Price, J. T. (Westhoughton) |
| Braddock, Mrs. Elizabeth | Houghton, Douglas | Price, Philips (Gloucestershire, W.) |
| Brockway, A. F. | Howell, Denis (All Saints) | Proctor, W. T. |
| Broughton, Dr. A. D. D. | Hughes, Cledwyn (Anglesey) | Pryde, D. D. |
| Brown, Rt. Hon. George (Belper) | Hughes, Emrys (S, Ayrshire) | Randall, H. E. |
| Brown, Thomas (Ince) | Hughes, Hector (Aberdeen, N.) | Reeves, J. |
| Burke, W. A. | Hunter, A. E. | Reid, William |
| Burton, Miss F. E. | Irvine, A. J. (Edge Hill) | Robens, Rt. Hon. A. |
| Butler, Mrs. Joyce (Wood Green) | Irving, s. (Dartford) | Roberts, Albert (Normanton) |
| Castle, Mrs. B. A. | Isaacs, Rt. Hon. G. A. | Roberts, Goronwy (Caernarvon) |
| Champion, A. J. | Janner, B. | Ross, William |
| Chapman, W. D. | Jay, Rt. Hon. D. P. T. | Royle, C. |
| Chetwynd, G. R. | Jeger, George (Goole) | Short, E. W. |
| Clunie, J. | Jenkins, Roy (Stechford) | Silverman, Julius (Aston) |
| Coldrick, W. | Johnson, James (Rugby) | Skeffington, A. M. |
| Collick, P. H. (Birkenhead) | Johnston, Douglas (Paisley) | Slater, J. (Sedgefield) |
| Collins, V. J.(Shoreditch & Finsbury) | Jones, Rt. Hon. A. Creech (Wakefield) | Smith, Ellis (Stoke, S.) |
| Corbet, Mrs. Freda | Jones, David (The Hartlepool:) | Sorensen, R. W. |
| Cove, W. G. | Jones, Jack (Rotherham) | Sparks, J. A. |
| Craddock, George (Bradford, S.) | Jones, J. Idwal (Wrexham) | Steele, T. |
| Cronin, J. D. | Jones, T. W. (Merioneth) | Stones, W. (Consett) |
| Cullen, Mrs. A. | King, Dr. H. M. | Summerskill, Rt. Hon. E. |
| Daines, P. | Lawson, G. M. | Swingler, S. T. |
| Dalton, Rt. Hon. H. | Ledger, R. J. | Sylvester, G. O. |
| Darling, George (Hillsborough) | Lee, Frederick (Newton) | Taylor, Bernard (Mansfield) |
| Davies, Harold (Leek) | Lee, Miss Jennie (Cannock) | Taylor, John (West Lothian) |
| Deer, C. | Logan, D. G. | Thomas, Iorwerth (Rhondda, W.) |
| Delargy, H. J. | Mabon, Dr. J. Dickson | Thomson, George (Dundee, E.) |
| Dodds, N. N. | MacColl, J. E. | Thornton, E. |
| Donnelly, D. L. | McGhee, H. G. | Timmons, J. |
| Dye, S. | McGovern, d. | Tomney, F. |
| Ede, Rt. Hon. J. C. | McInnes, J. | Turner-Samuels, M. |
| Edwards, Rt. Hon. John (Brighouse) | ||
| Edwards, Rt. Hon. Ness (Caerphilly) | McKay, John (Wallsend) | Ungoed-Thomas, Sir Lynn |
| Edwards, Robert (Bilston) | McLeavy, Frank | Usborne, H. C. |
| Edwards, w. J. (Stepney) | MacMillan, M. K. (Western Isles) | Viant, S. P. |
| Evans, Albert (Islington, S.W.) | Mallalieu, E. L. (Brigg) | Wade, D. W. |
| Evans, Edward (Lowestoft) | Mann, Mrs. dean | Warbey, W. N. |
| Evans, Stanley (Wednesbury) | Marquand, Rt. Hon, H. A. | Watkins, T. E. |
| Fernyhough, E. | Mason, Roy | Weitzman, D. |
| Finch, H. J. | Mikardo, Ian | West, D. G. |
| Fletcher, Eric | Monslow, W. | Wheeldon, W. E. |
| Forman, J. C. | Moody, A. S. | White, Henry (Derbyshire, N.E.) |
| Fraser, Thomas (Hamilton) | Morris, Percy (Swansea, W.) | Wilcock, Group Capt. C. A. B. |
| Gibson, C. W. | Morrison, Rt. Hn. Herbert (Lewis'm, S.) | Wilkins, W. A. |
| Gooch, E. G, | Mort, D. L. | Willey, Frederick |
| Gordon Walker, Rt. Hon. P. C. | Moss, R. | Williams, David (Neath) |
| Williams, Rev. Llewelyn (Ab'tillery) | Wilson, Rt. Hon. Harold (Huyton) | Zilliacus, K. |
| William, W. R. (Openshaw) | Winterbottom, Richard | |
| Williams, W. T. (Barons Court) | Woodburn, Rt. Hon. A. | TELLERS FOR THE AYES: |
| Willis, Eustace (Edinburgh, E.) | Yates, V. (Ladywood) | Mr. Pearson and Mr. Simmons. |
| NOES | ||
| Agnew, Cmdr. P. G. | Harvey, John (Walthamstow, E.) | Nabarro, G. D. N. |
| Aitken, W. T. | Hay, John | Nairn, D. L. S. |
| Alport, C. J. M. | Head, Rt. Hon. A. H. | Neave, Airey |
| Arbuthnot, John | Heald, Rt. Hon. Sir Lionel | Nicholls, Harmar |
| Armstrong, C. W. | Heath, Rt. Hon. E. R. G. | Nicolson, N. (B'n'm'th, E. & Chr'ch) |
| Ashton, H. | Henderson, John (Cathoart) | Noble, Comdr. A. H. P. |
| Baldock, Lt.-Cmdr. J. M. | Hicks-Beach, Maj. W. W. | Nugent, G. R. H. |
| Baldwin, A. E. | Hill, Rt. Hon. Charles (Luton) | Oakshott, H. D. |
| Balniel, Lord | Hill, Mrs. E. (Wythenshawe) | O'Neill, Hn. Phelim (Co. Antrim, N.) |
| Barber, Anthony | Hinchingbrooke, Viscount | Orr, Capt. L. P. S. |
| Barlow, Sir John | Hirst, Geoffrey | Orr-Ewing, Charles Ian (Hendon, N.) |
| Barter, John | Holland-Martin, C. J. | Osborne, C. |
| Baxter, Sir Beverley | Hornsby-Smith, Miss M. P. | Page, R. G. |
| Bell, Philip (Bolton, E.) | Horobin, Sir Ian | Pannell, N. A. (Kirkdale) |
| Bidgood, J. C. | Horsbrugh, Rt. Hon. Dame Florence | Partridge, E. |
| Biggs-Davison, J. A. | Howard, Hon. Greville (St. Ives) | Peyton, J. W. W. |
| Birch, Rt. Hon. Nigel | Howard, John (Test) | Pickthorn, K. W. M. |
| Bishop, F. P. | Hudson, Sir Austin (Lewisham, N.) | Pilkington, Capt. R. A. |
| Body, R. F. | Hudson, W. R. A. (Hull, N.) | Pitman, I. J. |
| Bossom, Sir A. C. | Hughes, Hallett, Vloe-Admiral J. | Pitt, Miss E. M. |
| Boyd-Carpenter, Rt. Hon. J. A. | Hughes-Young, M. H. C. | Pott, H. P. |
| Boyle, Sir Edward | Hurd, A. R. | Price, Henry (Lewisham, W.) |
| Braine, B. R. | Hutchison, Sir Ian Clark (E'b'gh, W.) | Prior-Palmer, Brig. O. L. |
| Brooke, Rt. Hon. Henry | Hutchison, Sir James (Scotstoun) | Profumo, J. D. |
| Brooman-White, R. C. | Hylton-Fosrer, Sir H. B. H. | Raikes, Sir Victor |
| Browne, J. Nixon (Craigton) | Iremonger, T. L. | Redmayne, M. |
| Butler, Rt. Hn. R. A. (Saffron Walden) | Jennings, J. C. (Burton) | Remnant, Hon. P. |
| Campbell, Sir David | Johnson Dr. Donald (Carlisle) | Renton, D. L. M. |
| Carr, Robert | Johnson, Eric (Blackley) | Rippon, A. G. F. |
| Cary, Sir Robert | Johnson, Howard (Kemptown) | Robertson, Sir David |
| Channon, H. | Jones, Rt. Hon. Aubrey (Hall Green) | Robinson, Sir Roland (Blackpool, S.) |
| Clarke, Brig. Terence (Portsmth, W.) | Joynson-Hicks, Hon. Sir Lancelot | Rabson-Brown, W. |
| Cole, Norman | Keegan, D. | Roper, Sir Harold |
| Cordeaux, Lt.-Col. J. K. | Kerr, H. W. | Russell, R. S. |
| Corfield, Capt. F. V. | Kershaw, J. A. | Schofield, Lt.-Col. W. |
| Craddock, Beresford (Spelthorne) | Lambert, Hon. C. | Scott-Miller, Cmdr. R. |
| Crouch, R. F. | Lambton, Viscount | Simon, J. E. S. (Middlesbrough, W.) |
| Crowder, Sir John (Finchley) | Lancaster, Cot. C. G. | Smithers, Peter (Winchester) |
| Crowder, Petre (Ruislip—Northwood) | Leather, E. H. C. | Spence, H. R. (Aberdeen, W.) |
| Currie, G. B. H. | Leavey, J. A. | Spens, Rt. Hn. Sir P. (Kens'gt'n, S.) |
| Davies, Rt. Hon. Clement (Mongomery) | Lebum, W. G. | Stanley, Capt. Hon. Richard |
| D'Avigdor-Coldsmid, Sir Henry | Legge-Bourke, Maj. E. A. H. | Stevens, Geoffrey |
| Deedes, W. F. | Legh, Hon. Peter (Petersfield) | Steward, Harold (Stockport, S.) |
| Digby, Simon Wingfield | Lindsay, Martin (Solihull) | Steward, Sir William (Woolwich, W.) |
| Donaldson, Cmdr. C. E. McA. | Linstead, Sir H. N. | Stoddart-Scott, Col. M. |
| Doughty, C. J. A. | Llewellyn, D. T. | Studholme, H. G. |
| Drayson, G. B. | Lloyd, Maj. Sir Guy (Renfrew, E.) | Summers, G. S. (Aylesbury) |
| du Cann, E, D. L. | Lloyd-George, Maj. Rt. Hon. G. | Taylor, Sir Charles (Eastbourne) |
| Dugdale, Rt. Hn. Sir T. (Richmond) | Longden, Gilbert | Taylor, William (Bradford, N.) |
| Dunoan, Capt. J. A. L. | Lucas, Sir Jocelyn (Portsmouth, S.) | Teeling, W. |
| Eden, J. B. (Bournemouth, West) | Lucas-Tooth, Sir Hugh | Thomas, Leslie (Canterbury) |
| Emmet, Hon. Mrs. Evelyn | McAdden, S. J. | Thomas, P. J. M. (Conway) |
| Errington, Sir Eric | Macdonald, Sir Peter | Thompson, Lt.-Cdr. R. (Croydon, S.) |
| Farey-Jones, F. W. | Mackeson, Brig. Sir Harry | Thorneycroft. Rt. Hon. P. |
| Fell, A. | McKibbin, A. J. | Thornton-Kemsley, C. N. |
| Finlay, Graeme | Mackie, J. H. (Galloway) | Tiley, A. (Bradford, W.) |
| Fisher, Nigel | McLaughlin, Mrs. P. | Tilney, John (Wavertree) |
| Freeth, D. K. | Maclay, Rt. Hon. John | Touche, Sir Gordon |
| Galbraith, Hon. T. G. D. | Maclean, Fitzroy (Lancaster) | Turner, H. F. L. |
| Garner-Evans, E. H. | McLean, Neil (Inverness) | Turton, Rt. Hon. R. H. |
| George, J. C. (Pollok) | Macleod, Rt. Hn. Iain (Enfield, W.) | Tweedsmuir, Lady |
| Gibson-Watt, D. | MacLeod, John (Ross & Cromarty) | Vane, W. M. F. |
| Glover, D. | Maitland, Cdr. J. F. W. (Horncastle) | Vosper, D. F. |
| Godber, J. B. | Maitland, Hon. Patrick (Lanark) | Walker-Smith, D. C. |
| Gower, H. R. | Manningham-Buller, Rt. Hn. Sir R. | Wall, Major Patrick |
| Graham, Sir Fergus | Markham, Major Sir Frank | Ward, Dame Irene (Tynemouth) |
| Grant-Ferris, Wg. Cdr. R. (Nantwich) | Marlowe, A. A. H. | Waterhouse, Capt. Rt. Hon. C. |
| Green, A. | Marples, A. E. | Whitelaw, W. S. I. (Penrith & Border) |
| Grimston, Hon. John (St. Albans) | Marshall, Douglas | Williams, Paul (Sunderland, S.) |
| Grimston, Sir Robert (Westbury) | Maude, Angus | Wills, G. (Bridgwater) |
| Grosvenor, Lt.-Col. R. G. | Maydon, Lt.-Comdr. S. L. C. | Wilson, Geoffrey (Truro) |
| Hall, John (Wycombe) | Medlicott, Sir Frank | Wood, Hon. R. |
| Harris, Frederic (Croydon, N, W.) | Milligan, Rt. Hon. W. R. | Woollam, John Victor |
| Harris, Reader (Heston) | Molson, A. H. E. | Yates, William (The Wrekin) |
| Harrison, A. B. C. (Maldon) | Morrison, John (Salisbury) | |
| Harrison, Col. J. H. (Eye) | Mott-Radclylfe, C. E. | TELLERS FOR THE NOES: |
| Mr. E. Wakefield and Mr. Bryan. |
§ 9.15 p.m.
§ Sir L. PlummerI beg to move, in page 17, line 42, to leave out "whether" and to insert "provided that they are".
§ The Temporary Chairman (Mr. F. Blackburn)I suggest that it would be convenient to discuss, at the same time, the next Amendment, also in the name of the hon. Member for Deptford (Sir L. Plummer) in page 17, line 43, leave out "or of any other description".
§ Sir L. PlummerYes, Mr. Blackburn.
It is quite clear that the Bill interferes a good deal with the liberty of the subject. That is inescapable, for once we decide to embark on steps such as these we are bound to interfere with the liberty which has been enjoyed by some people up to now. Subsection (4) of Clause 20, however, is as tough as any provision ever to be written into a Bill of this kind. The purpose of my two Amendments is to do something towards protecting the small shopkeeper and retailer—the beloved of many hon. Members opposite—from some of the fairly harsh restrictions and penalties that may be imposed upon him.
The effect of the Clause is that a man who has been found guilty of breaking an agreement for the sale of one particular class of goods can be so treated as to prevent him from continuing that practice with another dissociated class of goods. Let me give an example of how this thing might work. A shopkeeper might, deliberately or inadvertently, break an agreement to sell one of the products of Lever Brothers, a toothpaste or a tin of peas, or a bar of soap. An injunction is obtained against him—and that is a rather harsh weapon to use against a man—not only for the offence which he has committed regarding that particular class of goods or product, but, as the Clause says so clearly, goods "of any other description".
Does that mean that a man who commits this offence can be punished twice; that there are two penalties? There is, first, the injunction taken against him because he broke an agreement about one class of goods, with the threat of pecuniary damages against him if he continues to do so; and there is the second penalty that he will have a similar sort of injunction and a similar threat of damages against him if he sells any other 1130 product presumably made by the same manufacturer.
This is putting two penalties on a man for one offence, which, I should have thought, was contrary to our law. Certainly, it means that a company which sells a great number of products can almost get itself into the position of establishing a system of collective resale price maintenance, which of course is completely contrary to the spirit of the Bill.
There are some other things in this Clause which will cause difficulties for the shopkeeper. What is the advantage to him of a sale not applying in the case of goods seized, according to paragraph (b),
by way of execution or distress "?What is the good to him of an injunction being taken against him on goods that he has already sold? The man has already sold them. He probably needed the money. Perhaps he was in great difficulties and that is why he got rid of the stock in the way this Clause suggests and prohibits. What is to be done to him? Is his life to be made even more difficult? In any case, what is to happen to the goods which a shopkeeper has on the shelf and is not able to sell in normal circumstances?Like everyone else, a shopkeeper is subjected to the blandishments of the salesman. I do not suppose that there is a shopkeeper who has not goods on his shelves which he finds extremely difficult to sell. What is he to do with them? Is he to throw them away? What he now does is to sell them to a cheapjack. The cheapjack takes them to the country market. The word "cheapjack" has a quite pleasant connotation to the women in the countryside who travel each week to the market town and go to the stall of the cheapjack to buy these goods at reduced prices. Why are they able to do so? Because this fellow travels round the countryside, relieving shopkeepers of their unsold stock.
There is no harm in that. Such a person performs a very useful economic purpose. The fact that the housewife can get cheap, if perhaps somewhat dusty, goods, satisfies her. Under this Clause, such a sale will cause penalties to be inflicted on the shopkeeper. I do not see what harm that does to the manufacturer.
1131 I understand that, later, my hon. Friend the Member for Blackburn (Mrs. Castle) is to deal with the question of cut prices. It is very difficult to say to the shopkeeper who is inundated with coupons pouring into his shop every day from this advertiser giving 5d. off the price of this article and that advertiser giving 4d. off the price of another brand, that prices ought not to be cut. The fact is that the Clause prevents the continuance of a perfectly reasonable form of dispersal of excess, unsold goods. I am surprised that there should come from hon. and hon. and learned Members opposite so restrictive a Clause as Clause 20.
§ Mr. Walker-SmithThe hon. Member for Deptford (Sir L. Plummer) has moved his Amendment, as he always does, persuasively, concisely and with clarity. There are in effect three ways in which one could deal with the problem with which this subsection seeks to deal. It would be possible, as the hon. Member suggests in his Amendment, to limit the court's power to grant an injunction to cover the particular line of goods which is the subject of the offending price cutting. That is what the hon. Member asks for.
That is one extreme, and it would be possible, as is suggested in Amendments proposed in page 17, line 36 and line 40, which have not been discussed by the Committee, to adopt a suggestion which would extend the power to grant an injunction to cover all price-maintained goods. Those are the two, as it were, extreme positions, either of which we could take up in an effort to solve the problem.
The subsection in the Bill takes a middle course, which perhaps is not seldom the best solution in these difficult matters. That course is to allow the injunction in respect of all the goods of the particular supplier and of the particular supplier alone. It really is an estimate of what is a reasonable course of action in all the circumstances. We think that that is a reasonable course of action, and that it would be unreasonable, following on the proposal of the hon. Member, to compel a supplier to make possibly repeated application to the court to grant a series of injunctions in respect of different lines of goods which might be successively the subject 1132 of price cutting by a small dealer. We think it is not an unreasonable inference that if a dealer is minded to cut prices on one line of a supplier's goods he might very well be minded to extend his operations sooner or later—and perhaps sooner rather than later—to other lines.
§ Sir L. PlummerIs the hon. Gentleman saying that if a man is a thief he therefore might be a wife beater? Is he saying that because a man will cut the price of cornflakes he will cut the price of soap? Surely that is a new departure in law.
§ Mr. Walker-SmithI think that the second proposition is more probable than the first. I resist the temptation at this hour and this stage of the proceedings to follow the hon. Member into those fascinating analogies of criminal law because, although he used the terminology of the criminal law. this is not a matter of criminal law. Although the hon. Member spoke of a double penalty he will appreciate that this subsection limits the relief which the court can grant to injunction and does not give a right of damages so there is no question of a double penalty even in the civil sense of the term.
The hon. Gentleman referred to the provisions of subsection (2, b). That is, of course, to relieve from the provisions of this subsection certain special forms of sale under a distress or so on, where we can hardly expect the resale price maintenance condition to run.
9.30 p.m.
I would add, as a final observation in answer to the generality of the hon. Gentleman's argument. that there may be a harshness in this. He suggested, for example. that this provision might bite on an inadvertence. I am sure that the hon. Gentleman and the Committee will bear in mind in all these matters that an injunction is a discretionary remedy, and it is always within the discretion of the court whether to grant the relief or not. I have little or no hesitation in saying that in the case of inadvertence quoted by the hon. Gentleman it was extremely unlikely that any court would grant an injunction in those terms in such a case.
I trust that the hon. Gentleman, having raised this point and ventilated it in this way, will not feel himself obliged to press the Amendment.
§ Sir L. Ungoed-ThomasThe Parliamentary Secretary has made an unsatisfactory reply. My hon. Friend the Member for Deptford (Sir L. Plummer) has put his case clearly and very forcibly before the Committee and I do not intend to cover any of the ground which he has covered.
My hon. Friend has made the point that what is being provided by this subsection is really a very harsh remedy. and that in the case, for instance, of a vast firm like Levers, if there is a departure by the retailer in one instance from the provisions of the agreement, then every single article within the range of the Lever commodities could come within an injunction granted by the court. That, as he said, is an extremely harsh provision. It is, we believe, really out of proportion to the sort of remedy that ought to be provided.
There is one other point which I would put forward in supplementing what my hon. Friend has said. As the Parliamentary Secretary has said, very rightly, an injunction is, of course, a discretionary remedy. He will recognise that what is contemplated—in fact, the sole purpose of the Clause—is that the remedy, which is not to be an ancillary remedy, shall be by way of injunction. When an application is made for an injunction for selling in breach of notice, as it is here now, the whole case deployed before the court would be bearing upon the cases in respect of which the breach has been committed.
What is contemplated by this Clause is that an injunction could be granted not
§ only in respect of those goods but of all the goods of that supplier, and all kinds of different considerations may arise. There may be very different circumstances, and the circumstances may change. It is quite conceivable that an injunction may be granted in respect of goods on which a breach has taken place and not on other goods. Nevertheless, the case that will be deployed before the court, as the Parliamentary Secretary will know—the whole gist of the application—will be on the breach that has been made, and the danger of this Clause is that, although the breach has been in respect of a particular class of goods, nevertheless all the other classes of goods would be included in the injunction, without the matter being deployed and examined in the same way as it would have been in the case of the goods which had been involved in the breach, That seems to us an extremely harsh provision, quite unnecessarily so, and really not justifiable for the purposes of the remedy. It puts in a privileged position the big concern, with the vast range of goods which it supplies, as compared with the small man who provides one or two articles.
§ The Government's reply is not satisfactory. We do not want to spend a great deal of time on the point, but we certainly do not accept the case made by the Parliamentary Secretary and we shall press the Amendment to a Division.
§ Question put, That "whether" stand part of the Clause:—
§ The Committee divided: Ayes 228, Noes 189.
1137| Division No. 175.] | AYES | [9.35 p.m. |
| Agnew, Cmdr. P. G. | Brooke, Rt. Hon. Henry | Duncan, Capt. J. A. L. |
| Aitken, W. T. | Brooman-White, R. C. | Eden, J. B. (Bournemouth, West) |
| Alport, C. J. M. | Browne, J. Nixon (Craigton) | Emmet, Hon. Mrs. Evelyn |
| Amery, Julian (Preston, N.) | Bryan, P. | Errington, Sir Eric |
| Arbuthnot, John | Butler, Rt. Hn. R. A. (Saffron Walden) | Farey-Jones, F. W. |
| Armstrong, C. W. | Carr, Robert | Fell, A. |
| Ashton, H. | Cary, Sir Robert | Finlay, Graeme |
| Atkins, H. E. | Channon, H. | Fisher, Nigel |
| Baldock, Lt.-Cmdr. J. M. | Clarke, Brig. Terence (Portsmth, W.) | Freeth, D. K. |
| Baldwin, A. E. | Cole, Norman | Galbraith, Hon. T. G. D. |
| Balniel, Lord | Cordeaux, Lt.-Col. J. K. | Garner-Evans, E. H. |
| Barber, Anthony | Corfield, Capt. F. V. | George, J. C. (Pollok) |
| Barlow, Sir John | Craddook, Beresford (Spelthorne) | Gibson-Watt, D. |
| Barter, John | Crouch, R. F. | Glover, D. |
| Baxter, Sir Beverley | Crowder, Sir John (Finohley) | Godber, J. B. |
| Bell, Philip (Bolton, E.) | Currie, G. B. H. | Gower, H. R. |
| Bidgood, J. C. | D'Avigdor-Goldsmid, Sir Henry | Graham, Sir Fergus |
| Biggs-Davison, J. A. | Deedes, W. F. | Grant-Ferris, Wg.Cdr. R. (Nantwich) |
| Bishop, F. P. | Digby, Simon Wingfieid | Green, A. |
| Body, ft. F. | Donaldson, Cmdr. C. E. McA. | Gresham Cooke, R. |
| Bossom, Sir A. C. | Doughty, C. J. A. | Grimston, Hon. John (St. Albans) |
| Boyd-Carpenter, Rt. Hon. J. A. | Drayson, G. B. | Grimston, Sir Robert (Westbury) |
| Boyle, Sir Edward | du Cann, E. D. L. | Grosvenor, Lt.-Col. R. G. |
| Braine, B. R. | Dugdale, Rt. Hn. Sir T. (Richmond) | Hall, John (Wycombe) |
| Harris, Frederic (Croydon, N.W.) | Lloyd, Maj. Sir Guy (Renfrew, E.) | Renton, D. L. M. |
| Harris, Reader (Heston) | Lloyd-George, Maj. Rt. Hon. G. | Rippon, A. G. F. |
| Harrison, A. B. C. (Maldon) | Longden, Gilbert | Robertson, Sir David |
| Harvey, Air Cdre. A. V. (Macclesfd) | Lucas, Sir Jocelyn (Portsmouth, S.) | Robinson, Sir Roland (Blackpool, S.) |
| Harvey, John (Walthamstow, E.) | Lucas-Tooth, Sir Hugh | Roper, Sir Harold |
| Hay, John | Macdonald, Sir Peter | Ropner, Col. Sir Leonard |
| Head, Rt. Hon. A. H. | Mackeson, Brig. Sir Harry | Russell, R. S. |
| Heald, Rt. Hon. Sir Lionel | McKibbin, A. J. | Schofield, Lt.-Col. W. |
| Heath, Rt. Hon. E. R. G. | Mackie, J. H. (Galloway) | Scott-Miller, Cmdr. R. |
| Henderson, John (Cathoart) | McLaughlin, Mrs. P. | Shepherd, William |
| Hill, Rt. Hon. Charles (Luton) | Maclay, Rt. Hon. John | Simon, J. E. S. (Middlesbrough, W.) |
| Hill, Mrs. E. (Wythenshawe) | Maclean, Fitzroy (Lancaster) | Smithers, Peter (Winchester) |
| Hill, John (S. Norfolk) | McLean, Neil (Inverness) | Spence, H. R. (Aberdeen, W.) |
| Hinchingbrooke, Visoount | Macleod, Rt. Hn. Iain (Enfield, W.) | Stanley, Capt. Hon. Richard |
| Hirst, Geoffrey | MacLeod, John (Ross & Cromarty) | Stevens, Geoffrey |
| Holland-Martin, C. J. | Maitland, Cdr. J. F. W. (Horncastle) | Steward, Harold (Stockport, S.) |
| Hornsby-Smith, Miss M. P. | Maitland, Hon. Patrick (Lanark) | Steward, Sir William (Woolwich, W.) |
| Horobin, Sir Ian | Manningham-Buller, Rt. Hn. Sir R. | Stoddart-Soott, Col. M. |
| Horsbrugh, Rt. Hon. Dame Florence | Markham, Major Sir Frank | Studholme, H. G. |
| Howard, Hon. Greville (St. Ives) | Marlowe, A. A. H. | Summers, G. S. (Aylesbury) |
| Howard, John (Tent) | Marshall, Douglas | Taylor, Sir Charles (Eastbourne) |
| Hudson, Sir Austin (Lewisham, N.) | Maude, Angus | Taylor, William (Bradford, N.) |
| Hudson, W. R. A. (Hull, N.) | Maydon, Lt.-Comdr. S. L. C. | Teeling, W. |
| Hughes Hallett, Vice-Admiral J. | Medlicott, Sir Frank | Thomas, Leslie (Canterbury) |
| Hurd, A. R. | Milligan, Rt. Hon. W. R. | Thomas, P. J. M. (Conway) |
| Hutchison, Sir Ian Clark (E'b'gh, W.) | Molson, A. H. E. | Thompson, Lt. Cdr. R. (Croydon, S.) |
| Hutchison, Sir James (Scotstoun) | Morrison, John (Salisbury) | Thorneycroft, Rt. Hon. P. |
| Hylton-Foster, Sir H. B. H. | Mott-Radclyffe, C. E. | Thornton Kemsley, C. N. |
| Iremonger, T. L. | Nabarro, G. D. N. | Tiley, A. (Bradford, W.) |
| Irvine, Bryant Godman (Rye) | Nairn, D. L. S. | Tilney, John (Wavertree) |
| Jenkins, Robert (Dulwloh) | Neave, Airey | Touche, Sir Gordon |
| Jennings, J. C. (Burton) | Nicholls, Harmar | Turner, H. F. L. |
| Johnson, Dr. Donald (Carlisle) | Nicolson, N. (B'n'm'th, E. & Chr'ch) | Turton, Rt. Hon. R. H. |
| Johnson, Eric (Blackley) | Noble, Comdr. A. H. P. | Tweedsmuir, Lady |
| Johnson, Howard (Kemptown) | Nugent, G. R. H. | Vane, W. M. P. |
| Jones, Rt. Hon. Aubrey(Hall Green) | Oakshott, H. D. | Vickers, Miss J. H. |
| Joseph, Sir Keith | O'Neill, Hn. Phelim (Co. Antrim, N.) | Vosper, D. F. |
| Joynson-Hicks, Hon. Sir Lancelot | Orr, Capt. L. P. S. | Wakefield, Edward (Derbyshire, W.) |
| Keegan, D. | Orr-Ewing, Charles Ian (Hendon, N.) | Walker-Smith, D. C. |
| Kerby, Capt. H. B. | Osborne, C. | Wall, Major Patrick |
| Kerr, H. W. | Page, R. G. | Ward, Dame Irene (Tynemouth) |
| Kershaw, J. A. | Pannell, N. A. (Klrkdale) | Waterhouse, Capt. Rt. Hon. C. |
| Lambert, Hon. G. | Partridge, E. | Whitelaw, W. S. I. (Penrith & Border) |
| Lambton, Viscount | Peyton, J. W. W. | Williams, Paul (Sunderland, S.) |
| Lancaster, Col. C. G. | Pickthorn, K. W, M. | Wills, G. (Bridgwater) |
| Langford-Holt, J. A. | Pilkington, Capt. R. A. | Wilson, Geoffrey (Truro) |
| Leather, E. H. C. | Pitman, I. J. | Wood, Hon. R. |
| Leavey, J. A. | Pitt, Miss E. M. | Woollam, John Victor |
| Leburn, w. G. | Pott, H. P. | Yates, William (The Wrekin) |
| Legge-Bourke, Maj. E. A. H. | Price, Henry (Lewisham, W.) | |
| Legh, Hon. Peter (Petersfield) | Profumo, J. D. | TELLERS FOR THE AYES: |
| Lindsay, Martin (Solihull) | Raikes, Sir Victor | Colonel J. H. Harrison and |
| Linstead, Sir H. N. | Redmayne, M. | Mr. Hughes-Young. |
| Llewellyn, D. T. | Remnant, Hon. P. | |
| NOES | ||
| Ainsley, J. W. | Chetwynd, G. R. | Fletcher, Eric |
| Allaun, Frank (Salford, E.) | Clunie, J. | Forman, J. C. |
| Allen, Arthur (Bosworth) | Coldrick, W. | Fraser, Thomas (Hamilton) |
| Allen, Scholefield (Crewe) | Collick, P. H. (Birkenhead) | Gibson, C. W. |
| Awbery, S. S. | Collins, V. J.(Shoreditch & Finsbury) | Gooch, E. G. |
| Bacon, Miss Alice | Corbet, Mrs. Freda | Gordon Walker, Rt. Hon. P. C. |
| Baird, J. | Craddock, George (Bradford, S.) | Grenfell, Rt. Hon. D. R. |
| Bence, C. R. (Dunbartonshire, E.) | Cronin, J. D. | Grey, C. F. |
| Benson, G. | Cullen, Mrs. A. | Griffiths, David (Rother Valley) |
| Beswick, F. | Dalton, Rt. Hon. H. | Griffiths, Rt. Hon. James (Llanelly) |
| Blenkinsop, A. | Darling, George (Hillsborough) | Griffiths, William (Exchange) |
| Blyton, W. R. | Davies, Rt. Hon. Clement (Montgomery) | Grimond, J. |
| Boardman, H, | Davies, Harold (Leek) | Hall, Rt. Hn. Glenvil (Colne Valley) |
| Bottomley, Rt. Hon. A. G. | Deer, G. | Hannan, W. |
| Bowden, H. W. (Leicester, S.W.) | Delargy, H. J. | Harrison, J. (Nottingham, N.) |
| Bowles, F. G. | Dodds, N. N., | Hastings, S. |
| Boyd, T. C. | Donnelly, D. L. | Hayman, F. H. |
| Braddock, Mrs. Elizabeth | Dye, S. | Healey, Denis |
| Brockway, A. F. | Ede, Rt. Hon. J. C. | Hobson, C. R. |
| Broughton, Dr. A. D. D. | Edwards, Rt. Hon. John (Brighouse) | Holmes, Horace |
| Brown, Rt. Hon. George (Belper) | Edwards, Rt. Hon. Ness (Caerphilly) | Holt, A. F. |
| Brown, Thomas (Ince) | Edwards, Robert (Bilston) | Houghton, Douglas |
| Burke, W. A. | Edwards, w. J. (Stepney) | Howell, Denis (All Saints) |
| Burton, Miss F. E. | Evans, Albert (Islington, S.W.) | Hughes, Cledwyn (Anglesey) |
| Butler, Mrs. Joyce (Wood Green) | Evans, Edward (Lowestoft) | Hughes, Emrys (S. Ayrshire) |
| Castle, Mrs. B. A. | Evans, Stanley (Wednesbury) | Hughes, Hector (Aberdeen, N.) |
| Champion, A. J. | Fernyhough, E. | Hunter, A. E. |
| Chapman, W. D. | Finch, H. J. | Hynd, H. (Accrington) |
| Irvine, A. J. (Edge Hill) | Moyle, A. | Summersklli, Rt. Hon. E. |
| Irving, S. (Dartford) | Mulley, F. W. | Swingler, S. T. |
| Isaacs, Rt. Hon. C. A. | Neal, Harold (Bolsover) | Sylvester, G. O. |
| Janner, B. | Oliver, G. H. | Taylor, Bernard (Mansfield) |
| Jay, Rt. Hon. D. P. T. | Oram, A. E. | Taylor, John (West Lothian) |
| Jeger, George (Goole) | Orbach, M. | Thomas, Iorwerth (Rhondda, W.) |
| Jenkins, Roy (Stechford) | Oswald, T. | Thomson, George (Dundee, E.) |
| Johnston, Douglas (Paisley) | Owen, W. J. | Thornton, E. |
| Jones, Rt. Hon. A. Creech (Wakefield) | Paget, R. T. | Timmons, J. |
| Jones, David (The Hartlepools) | Paling, Rt. Hon. W. (Dearne Valley) | Tomney, F. |
| Jones, Jack (Rotherham) | Paling, Will T. (Dewsbury) | Turner-Samuels, M. |
| Jones, J. Idwal (Wrexham) | Parker, J. | Ungoed-Thomas, Sir Lynn |
| Jones, T. W. (Merioneth) | Paton, J. | Usborne, H. C. |
| King, Dr. H, M. | Peart, T. F. | Wade, D. W. |
| Lawson, C. M. | Plummer, Sir Leslie | Warbey, W. N. |
| Ledger, R. J. | Popplewell, E. | Watkins, T. E. |
| Lee, Frederiok (Newton) | Price, J. T. (Westhoughton) | Weitzman, D. |
| Logan, D. G. | Price, Philips (Gloucestershire, W.) | West, D. G. |
| Mabon, Dr. J. Dickson | Proctor, W. T. | Wheeldon, W. E. |
| MacColl, J. E. | Pryde, D. J. | White, Henry (Derbyshire, N.E.) |
| McGhee, H. G. | Randall, H. E. | Wilkins, W. A. |
| McGovern, J. | Reeves, J. | Willey, Frederick |
| McInnes, J. | Robens, Rt. Hon. A. | Williams, David (Neath) |
| McKay, John (Wallsend) | Roberts, Albert (Normanton) | Williams, Rev. Llywelyn (Ab'tillery) |
| McLeavy, Frank | Roberts, Goronwy (Caernarvon) | Williams, W. R. (Openshaw) |
| MacMillan, M. K. (Western Isles) | Ross, William | Williams, W. T. (Barons Court) |
| Mallalieu, E. L. (Brigg) | Royle, C. | Willis, Eustace (Edinburgh, E.) |
| Mann, Mrs. Jean | Short, E. W. | Wilson, Rt. Hon. Harold (Huyton) |
| Marquand, Rt. Hon. H. A. | Silverman, Julius (Aston) | Winterbottom, Richard |
| Mason, Roy | Skeffington, A, M. | Woodbum, Rt. Hon. A. |
| Mikardo, Ian | Slater, J. (Sedgefield) | Woof, R. E. |
| Monslow, W. | Smith, Ellis (Stoke, S.) | Yates, V. (Ladywood) |
| Moody, A. S. | Sorensen, R. W. | Zilllacus, K. |
| Morris, Percy (Swansea, W.) | Sparks, J. A. | |
| Mort, D. L. | Steele, T. | TELLERS FOR THE NOES: |
| Moss, R. | Stones, W. (Consett) | Mr. Pearson and Mr. Simmons. |
§ 9.45 p.m.
§ Mr. Rov JenkinsI beg to move, in page 17, line 43, at the end to add:
but the court shall not grant an injunction unless it is satisfied that the granting of the injunction would not be contrary to the public interest".
§ The Deputy-Chairman (Sir Rhys Hopkin Morris)Perhaps it will be convenient to take this Amendment and the remaining Amendments on page 3040 of the Notice Paper together.
§ Sir L. Ungoed-ThomasI think perhaps the convenient course would be to take this Amendment and the next three together, because the last one really raises a different point.
§ The Deputy-ChairmanI understood that that was the original position, but I am now informed that it is desired to change.
§ Mr. E. FletcherI am prepared to move the last Amendment on that page, to which my name is attached, and which raises a totally separate point.
§ The Deputy-ChairmanThen it may be convenient to take the Amendment which I have called and the next three together:
1138 In page 17, line 43, at the end to add:
but the court shall not grant an injunction unless it is satisfied that it is not calculated to operate to an unreasonable extent to the detriment of purchasers consumers and users of such goods or otherwise to the detriment of the public".In line 43, at the end to add:but the court shall not grant an injunction unless it is satisfied that the said condition is reasonable in the interests of the supplier and of the consumers".In line 43, at the end to add:but the court shall not grant an injunction unless it is satisfied that it cannot directly or indirectly assist the enforcement of any agreement within section five of this Act which has been declared to be contrary to the nubile interest or section nineteen of this Act".
§ Mr. JenkinsThese four Amendments, together with the Amendment which my hon. Friend the Member for Islington, East (Mr. E. Fletcher) will move later, have a common purpose. Their purpose is that of seeking to remove the situation in which individual resale price maintenance has the automatic protection of the courts and is in all circumstances regarded as something which is not to be argued about, but which the courts will automatically protect. That is the purpose of the Amendments, which offer alternative methods to achieve the purpose of the Clause. I do not want to discuss the 1139 methods, but to turn to the underlying purpose and discuss it.
I think that throughout the debate this evening the Government have been in a difficulty because the way in which this Clause and the preceding Clause are drafted shows the extraordinary attitude of the Government. One can well understand them approaching this matter in something of a spirit of compromise. No doubt some people in the Cabinet said one thing and other people said another about resale price maintenance, and it was eventually decided to outlaw in a blanket way the collective enforcement of resale price maintenance, and, at the same time, to make a complete legal blanket enforcement of individual resale price maintenance, which might appear to be a fairly satisfactory compromise.
It is not, however, something that really stands up to logical examination, and now, having seen Amendment after Amendment put forward from both this side of the Committee and from the other, the Government are finding it very difficult to maintain a consistent attitude, just because of this question of resale price maintenance. They concern themselves entirely with the shadow of enforcement, and have not worried about the substance of the thing itself.
Here, we are concerned about the substance of resale price maintenance. We are not in these Amendments attempting to go in an extreme direction in relation to resale price maintenance, which we can discuss on the Question, That the Clause stand part of the Bill. We are not attempting to take the line that all resale price maintenance is bad, but we are putting forward the reasonable point of view that, while individual resale price maintenance may be a good thing in some cases, there are equally other cases where the case for it is by no means obvious, and where it is wrong that it should be granted the automatic protection of the court, without the court having any discretion at all to consider the issue of the public interest, as in other parts of this Bill it is constantly being told to do.
This should be a point of view which ought, in logic at any rate, to be acceptable to many hon. Members opposite who have put Amendments before the Committee and have spoken in support of them on Clause 19. When we were dealing 1140 with one part of the Government's compromise—that outlawing collective enforcement of resale price maintenance—one Member after another on the other side of the Committee asked us at least to accept the possibility that, concerning the collective enforcement of resale price maintenance, which after all most people regard as one of the most objectionable features of the whole field of restrictive practices, something in that direction might be desirable. What we are asking in this Amendment is the converse, but a much more responsible converse, of that.
We are asking that, in a Bill which is intended to be an anti-restrictive practices Bill, the Government should accept at least the possibility that some cases of individual resale price maintenance may not be in the public interest. In order to do that, one does not have to take the extreme point of view. The hon. Member for Carlisle (Dr. D. Johnson) referred to the book trade, in which there probably is a case for individual resale price maintenance. In many other cases the same position may be accepted, but what we are asking is that the Court should have some discretion, and should be able to bring into the balance the public interest.
We have heard from the benches opposite today a number of extremely muddled and confused arguments in favour of individual resale price maintenance. I thought that a very effective reply was made a little earlier by the hon. Member for Ealing, South (Mr. Maude) to some points raised by the hon. Member for Twickenham (Mr. Gresham Cooke) on that subject. The hon. Member for Heston and Isle-worth (Mr. R. Harris) made some remarks which would have been more fitting if made on this Clause than on the Clause on which he spoke. I should like to make a few comments on those points.
One of the points made in an intervention to a speech by my hon. Friend the Member for Deptford (Sir L. Plummer) was that it did not matter if we did not have price competition in cases of resale price maintenance goods, because there were a lot of other goods in respect of which we could have price competition and which would allow the economies of more efficient methods of retailing to be passed on to the consumer. That is a most extraordinary argument. Why should it be assumed that it is a good 1141 thing not to have price competition in a certain range of goods because there is another range of goods in which we can have price competition? This is by no means clear or logical.
It is also argued that we cannot have competition in service unless we exclude competition in price. That again seems to be a most extraordinary proposition and a completely false antithesis. There is no reason why there cannot be competition in a service which is given alongside with price competition. The danger about concentrating on competition in service without having competition in price is that we then get into a position in which we may well be offering the consumer a choice of a whole range of things but which are not the things he really wants.
§ Mr. Gresham CookeThe hon. Member is overlooking the factor of competition in price as between manufacturers. That remains. There is always competition in price between manufacturers.
§ The Deputy-ChairmanThe hon. Gentleman appears to be widening the scope of the debate on this Amendment.
§ Mr. JenkinsThe point underlying all these Amendments is that the court should have the power not to grant an injunction if it feels in particular cases that individual resale price maintenance is not in the public interest. The issue to which I was attempting to address myself, and which seems to be central to this matter, is whether there may be a particular case in which individual resale price maintenance is not in the public interest. In order to discuss that matter sensibly one is bound to argue some of the consequences of individual resale price maintenance and some of the advantages which there would be from its disappearance.
The hon. Member for Twickenham made an intervention which was very similar to that with which I tried to deal earlier, namely, that it is all right to have no price competition in a certain range of goods because it is possible to have that competition in another range of goods. He says it is all right to have no competition at the retail stage because we can have it at the manufacturing stage.
Hon. Members must make up their minds whether price competition is a 1142 good thing or is not a good thing. If it is not a good thing, it cannot be an advantage that we have it in some other way; if it is a good thing, it is by no means self-evident why we should not have it at the retail end. If it is good for manufacturers, why must it be excluded entirely from the retail field? I cannot in any way follow the force of the arguments on that point advanced by the hon. Member for Twickenham.
A series of comments have been made about small shopkeepers. The hon. Member for Heston and Isleworth (Mr. R. Harris), in his exhilarating oration a little earlier today, was, I think, rather unjust to the small shopkeeper. He speaks of the small shopkeeper as though he has to be mollycoddled and protected by the law to quite a ridiculous extent in order to remain in existence at all. I am quite sure that the association of small shopkeepers, or whatever such a body may be called, would be extremely ill-advised to employ the hon. Member for Heston and Isleworth as a public relations officer, because he presents the whole case on the basis that the small shopkeeper is so grossly inefficient that he cannot hope to keep in business unless the whole price mechanism of the retail trade is rigged in his favour. The hon. Gentleman has taken the argument much too far.
If it is true, as we are constantly being reminded by hon. Members opposite, that competition in service is extremely important and we should not concern ourselves only with competition in price, the argument applies both ways. If the small shopkeeper is really serving the needs of the public—as I am sure he is in certain cases—he should be able to remain in being because of the better service which he can offer as compared with the large concerns. The hon. Member for Heston and Isleworth has substantially overstated his case in that regard.
The point that we are trying to make here is that it is by no means self-evident that individual resale price maintenance is of public good. We therefore ask, not at all unreasonably, that it should be open to the court, as it is in almost every other Part of the Bill, to take account of the various grounds of public interest which are set out in detail in the Bill, to decide that certain schemes are not in 1143 the public interest, and accordingly to refuse an injunction when these matters are under consideration.
§ Mr. R. HarrisThe hon. Member for Stechford (Mr. Roy Jenkins) is, of course, falling into the old political error of picking out those parts of reports which suit his book and ignoring those which do not. He has just made a statement which really needs answering. He says that the desirability of individual resale price maintenance is not necessarily selfevident. Hon. Members on the other side of the Committee have continually been quoting from the numerous reports on the subject. All of them have supported individual price maintenance. It is on collective price maintenance that some have expressed doubt, though, even here, there has been approval. Support for individual price maintenance has been consistent throughout.
§ Mr. Roy JenkinsWould the hon. Member say that the Report of the Monopolies Commission on the Supply and Export of Pneumatic Tyres—which I am sure he must have looked at—offered a complete justification of the Dunlop scheme for resale price maintenance?
§ Mr. HarrisThere is no criticism of what Dunlop has done in the Report. I was not speaking of reports on individual industries; I was referring to general reports on collective discrimination.
I cannot understand why the hon. Member says that I have done injustice to the small shopkeepers, because I have not. It is quite wrong of him to say that. The real point is that if the hon. Member wants a court to pronounce upon the desirability or otherwise of this, he should have supported me on Clause 19, when I wanted all these matters to be subject to registration and to go before the Restrictive Practices Court. That would have been his proper line of action.
§ 10.0 p.m.
§ The Deputy-ChairmanOrder. We must not go back to Clause 19.
§ Mr. HarrisI was afraid that you would say that, Sir Rhys, but I got the point in before I was called to order. It is the obvious answer.
§ The Deputy-ChairmanThe obvious answer is to keep in order.
§ Mr. HarrisThe Amendment wants the Court to say whether or not the granting of an injunction is contrary to the public interest. There is a perfectly good procedure laid down in the Bill for deciding whether or not something is in the public interest. I hope my right hon. Friend will resist the Amendment, which will make the application of resale price maintenance still more difficult than it will be in any case. The difficulties will be colossal. I have not much faith in Clause 20. It will be very difficult to work because of the difficulties of suppliers actually taking action to enforce their prices. They may be entitled to do it under the Clause, but whether they will be able to do it is quite a different matter. I hope that my right hon. Friend will resist anything which will make it more difficult.
§ Mr. GrimondI hope that the hon. Member for Heston and Isleworth (Mr. R. Harris) may prove right in thinking that Clause 20 will not be as effective as some of us fear it may be. My own suspicion is that, in some trades at any rate, by the judicious application of Clause 20 we may come precious near to collective price maintenance again. We must watch that position carefully. We are not yet quite clear how far the trade associations may help in actions taken by individual suppliers under Clause 20. That, also, is very important. I fully appreciate that an association cannot take action under Clause 20 in its own name, but how far it can give assistance to the supplier is a point about which the Parliamentary Secretary might be good enough to say something.
There have been reports which certainly uphold individual resale price maintenance. I agree that there is a case for individual resale price maintenance, certainly in some trades and in relation to some goods, although, having listened to the argument, I find it more and more difficult to understand exactly which goods these are which have a cast-iron case for price maintenance. At the same time, it is becoming abundantly clear that there are great difficulties over the whole matter. There was the difficulty with the co-operative societies, and there is the real difficulty, pointed out by the hon. 1145 Member for Deptford (Sir L. Plummer), of the small trader who wants to get rid of his surplus stock and who becomes liable for heavy penalty if he tries to do so.
I have considerable sympathy with the Amendment. I certainly think that it would be a step in the right direction, if it were practicable. What I am not clear about, after listening to the hon. Member for Stechford (Mr. Roy Jenkins), is whether the court would be an ordinary court and not the Restrictive Practices Court. We should have two courts pronouncing on public interest in relation to all those questions of restrictive practices in the Bill. We should have one definition from the Restrictive Practices Court, and it is not inconceivable that we might have a different definition of public interest from the other court. That is a genuine difficulty. If that could be surmounted I should feel happier about the Amendment.
I suggest that the Government should take back the whole of Clause 20 and look at it again and consider whether it does not go much too far, and particularly whether it does not get near to collective price maintenance. If the Amendment proves impracticable, the Government might see whether they cannot bring forward something at a later stage which would limit individual price maintenance to cases which can be shown to be not only in the interests of the supplier, but also in the interests of the public. It may be out of order to say so now, but Clause 19, also, might well be a matter for reconsideration.
§ Mrs. CastleI want to support the Amendment and to suggest to the Committee that it is a very important one to which we must give careful consideration. It seems to me that there is a rather lighthearted approach to the Clause on the part of the President of the Board of Trade and the Parliamentary Secretary. We are taking a very serious step here, because we are going further than merely accepting individual resale price maintenance. We are giving a legal status to enforcement which it has not had before. We are taking a restrictionist practice and giving it a new legal sanction in the Clause. We on this side of the Committee suggest that that is something which we simply cannot do automatically without 1146 there being a check to ensure that the public interest is safeguarded.
We recently had a very good speech by the President of the Board of Trade in which he rejoiced our hearts by pointing out that we should recognise that price maintenance was not a desirable thing and that what people hoped for was a reduction in prices and not the consolidation of higher prices. In this Clause, however, we have a remarkable example of Conservative policy. We on this side of the Committee have frequently argued in favour of enforcement by law of maximum prices, but the Government have opposed that. They have abolished price control. They do not believe in having that kind of sanction, but in this Clause we have the Government introducing by legal sanction a minimum price control. We ought to realise the seriousness of this step.
We have heard many arguments in favour of individual resale price maintenance, and arguments why the manufacturer should have the right to safeguard his own reputation and the quality of his goods and his own manufacturing processes by being able to ensure that the prices which he thinks are right should be maintained. But a great deal of this is sheer "hooey." The case which is sometimes made out for the resale price maintenance of branded goods simply will not bear examination.
Let us take, for instance, the classic case of detergents. Only this morning there was pushed through my door a 5d. voucher from Persil informing me that if I would go to my shop and buy a giant packet of Persil I would get 5d. knocked off the price.
This price war amongst the detergent manufacturers has been going on for months. Are we to say that a manufacturer should be allowed to maintain his prices by law when he cuts them himself by giving free vouchers? One of the things that I would want the court to do would be to refuse an injunction for enforcing resale price maintenance to any firm which cuts its own prices. In this matter we are reaching a ludicrous situation. Whose reputation is safeguarded in this case? Is Persil's? Is Dreft's? Is Tide's? Is Surf's? Is that of any other of this tidal wave of detergents sweeping across the market? Whose reputation is maintained?
1147 If I liked to take to my grocer the 5d. voucher for Persil or the 3d. voucher for Surf or the 2d. voucher for Tide—or whatever it is, I do not keep count—I could trade the voucher for anything. [An HON. MEMBER: "Cigarettes."] I could trade them for anything. They represent a discount which the retailer will collect from the manufacturer. It does not necessarily mean that I have to buy a giant packet of Persil—
§ The Deputy-ChairmanOrder, order. I am loath to interrupt the hon. Lady, but her speech is really directed to the Question, "That the Clause stand part of the Bill."
§ Mrs. CastleWith respect, Sir Rhys, that is not so. I am saying that the case often made for the enforcement of resale price maintenance under this Clause is that a firm must be able to maintain the reputation of its own branded goods. I suggest that manufacturers themselves make that reputation absurd by devices such as these vouchers. I am arguing that one of the things we have in mind in moving this Amendment is that the court should refuse to grant an injunction to any manufacturer who is not maintaining his own resale price, and I suggest that this is in order.
There ought to be good arguments used for giving this new legal sanction before we permit it. Another argument used is that the price maintenance of branded goods enables a firm to get an adequate return with which it can carry out the research from which we all benefit. There, again, much nonsense is talked. One of the most highly price-maintained pharmaceutical products is Aspro. Ask almost anyone whether Aspro is worth the extra money paid for it. Of course it is not, but it is a most fiercely price-maintained article. Under this Clause we are proposing that Aspro could take a retailer to the Court, and our Amendment says that we would not wish the Court to be given that power unless it was satisfied that the price to be imposed by law is reasonable in relation to the value of the product.
If we are to have this kind of minimum price control then there ought to be some study of the matter from the point of view of the consumer and of the public interest. I would go further and say that many of the inflated prices paid for 1148 branded articles, which we are asked to underpin by a legal sanction, are not levied for the purpose of public interest. They are not levied to cover research. They are levied far more to cover advertising.
There was an interesting article in theBritish Medical Journalrecently by Dr. William Sargant. He was warning of the dangers arising because manufacturers of drugs were flooding doctors with extensive advertising material and shoals of circulars urging the claims of drugs whose value have not been authoritatively established. Suicides have even been caused by the bad prescribing of these drugs, and there have been dangerous complications from their unwise prescription.
That is done because doctors are subjected to high-powered advertising. Are we really going to say that the court should automatically give an injunction to enforce a price which is inflated far more by advertising factors than by considerations of fundamental research? We submit, in this Amendment, that the public interest should be safeguarded here, just as much as it needs to be protected in any other part of the Bill.
10.15 p.m.
I want to put another point to the Parliamentary Secretary. This is what worries me very much indeed. In one part of the Bill we shall refer to the Commission the problem of single-firm monopolies. That is to be the subject of future consideration elsewhere. Yet in this Clause we are giving singe-firm monopolies stronger powers of enforcement of their prices without there being any kind of safeguard to ensure that the public interest is thereby served. That is contrary to the whole tenor of the Bill.
I will give the Committee an example of what is happening. Reference has been made to tyres. We are still waiting to know what is to happen about the problem of tyres sold in the replacement market. In its Report on tyres the Commission found that there were identical prices in the replacement market and that there were also certain collective practices of enforcement which were undesirable.
The Report went very much further than that. It gave expression to a frontal condemnation of individual resale price 1149 maintenance in the tyre industry. It said:
It appears to us that in the circumstances of this industry… the only way to ensure a reasonable degree of price competition in sales to the public is to abolish the maintenance of retail prices, whether it be individual or collective.If the Clause is passed, how shall we be able to carry out that recommendation?I was alarmed by a sentence in the speech by the President on Second Reading, in which he told us emphatically:
… I do not propose to make Governmental decisions on matters which are now made justiciable."—[OFFICIAL, REPORT, 6th March. 1956; Vol. 549, c. 1949.]The right hon. Gentleman was, in fact, washing his hands of the recommendations in the Commission's Report on tyres. It said that individual resale maintenance in the case of tyres is wrong, contrary to the public interest and underpinning the killing of effective price competition in the industry.
§ Mr. R. HarrisThat may be true, but surely the hon. Lady will realise that, excluding the chairman, of the eight members of the Commission, four said exactly what she has said and the other four said the opposite.
§ The Deputy-ChairmanI find it very difficult to follow the hon. Lady's argument. I cannot see that the merits or otherwise of price maintenance are arguable here. The question is what the powers of the court shall be.
§ Mrs. CastleWith infinite respect, Sir Rhys, I am suggesting that without our Amendment it will be impossible for the court to refuse an injunction to a tyre manufacturer on the grounds that price maintenance in his case would be contrary to the public interest. We have had a very detailed Report on the industry which says that individual resale price maintenance in the tyre industry is contrary to the public interest. Our Amendment would give the court the power to refuse an injunction, because the Commission has given it the evidence on which to establish that an injunction would be contrary to the public interest. We move our Amendment in an effort to provide that flexibility. I urge the Parliamentary Secretary to read the Clause carefully. As it stands, he is making the new sanction automatic, in a 1150 sphere where there is a great deal of anxiety about the effects of the Clause.
§ Mr. Walker-SmithWe have had a very interesting debate on these Amendments and have ranged fairly wide over the general merits of individual resale price maintenance. Naturally, Sir Rhys, I entirely concur with your view that we are on a relatively narrow point here. The Committee will appreciate that individual resale price maintenance as between a supplier and a dealer is something which can already be enforced in the ordinary way by legal proceedings in the courts.
All that is being done by the Clause is to give a right, not now existing, for the supplier to, as it is sometimes called, sue down the line or, in the more technical language of the Bill, be able to enforce his right against any person not party to the sale who subsequently acquires the goods with notice of the condition as if he had been a party thereto.
That is all that the Clause does. It merely adds one additional step or right to the enforcement of individual resale price maintenance which in principle exists already in the law as it stands. Indeed, as I indicated on Second Reading, all that is done here is to assimilate the general law to the law as it already exists where patents, copyright and registered designs are in existence. As the Committee will see from the Long Title of the Bill, all that it is concerned to do is
to make further provision for the individual enforcement of such conditions by legal proceedings…In other words, the Bill does not give rise to a right: the right already exists. It merely improves it in this respect. What the Amendments are concerned with is whether that extended right should be limited by applying a public interest test.The hon. Member for Stechford (Mr. Roy Jenkins), who, on Second Reading, made some interesting reflections on the general principles of resale price maintenance, has gone into the merits of it to some extent again this evening. He condemns our approach on the grounds that it is a compromise approach. If that be so, I do not know that I am prepared to apologise for it, because an empirical approach—to some extent a compromise approach—is an abiding characteristic of the traditional British 1151 approach to this sort of question. I would prefer, however, rather than use the word "compromise," to say that we have made a general approach to the question of resale price maintenance—I quite accept that.
We have taken the view that it is necessary to make a general approach, and we have made a general approach in respect both of collective enforcement and of individual enforcement. We have proscribed collective enforcement and we have somewhat reinforced the right of individual enforcement. After all the discussion and thinking that we have had about these matters, I am not prepared at all to abate my view that this general approach is the right approach in all the circumstances and that it is not practical or appropriate in these circumstances to seek to apply a case by case approach to specific cases of individual enforcement of resale price maintenance.
In so far as we are concerned with the generality of the matter, the Committee will recall that the authoritative examination of individual resale price maintenance took place in the Lloyd Jacob Committee, which found in favour of individual resale price maintenance.
§ Mr. JayThe hon. and learned Gentleman will agree that the Lloyd Jacob Committee did not propose that it should be made legally enforceable.
§ Mr. Walker-SmithFollowing on what other hon. Members have dealt with, I am on the merits of the position. What the right hon. Gentleman says is true, and I am obliged to him, but the Lloyd Jacob Committee was not spelling out a solution in the whole field of restrictive trade practices, as we are seeking to do with the Bill. It did, however, approve the principle. The Monopolies Commission, in its Report on Collective Discrimination, did not consider individual enforcement of resale price maintenance because it was out with its terms of reference.
There has been a good deal of play with the Report of the Monopolies Commission on the Supply and Export of Pneumatic Tyres, and I shall certainly not court your rebuke, Sir Rhys, by going into the question of that Report.
§ Mrs. CastleWhy not?
§ Mr. Walker-SmithThe hon. Lady asks me, "Why not?" It is because I respect the Ruling of the Chair.
§ Mrs. CastleThe hon. and learned Gentleman is just evading the point.
§ Mr. Walker-SmithI will deal with the point in 30 seconds, if the hon. Lady likes. There is nothing at all to get cross about in this. It is all a matter of weighing up this difficult question and coming to the best judgment we can on the evidence available.
So far as the Report on tyres is concerned, there are two points which derogate from its value as an expression of general principle. The first has already been made by my hon. Friend the Member for Heston and Isleworth (Mr. R. Harris). It was a majority recommendation by the narrowest of majorities, in any event. Secondly, the expression of opinion was specifically related to the particular and unusual circumstances of the tyre industry. And it is, of course, not appropriate to stand as a general view on individual resale price maintenance as such.
That being our general approach, in this Amendment we are faced with the position of whether it is applicable, because I echo with respect what was said by the hon. Member for Orkney and Shetland (Mr. Grimond) —
§ Mr. Roy JenkinsMay I put this to the hon. and learned Gentleman before he leaves the question of the Report on tyres? He says airily that the Report relates only to the tyre industry and cannot be applied in general. If he rejects the Amendment it will make it impossible for anything to be done to implement that Report. We are not asking him, on the basis of the Report on tyres, to come out in a blanket way against resale price maintenance. We are asking him to admit the possibility of there being exceptions from the general position. From that point of view the Report on tyres is of extreme importance and is completely relevant as the result of only one industry.
§ Mr. Walker-SmithAs the hon. Gentleman points out, the Report on tyres, with a very appropriate sense of relevance, was concerned with the tyre industry. All I am asking the Committee to do is to refrain from drawing from the Report, 1153 which related to the specific and unusual circumstances of that industry, a general principle over the whole field of individual resale price maintenance.
§ Mr. JayIf our argument is that there may be some exceptions, is it not relevant as an example of one exception?
§ Mr. Walker-SmithBut the value of spelling out an exception is subject to the point I was dealing with, whether there is a practical remedy or solution to this problem contained in these Amendments. I ask the Committee to say that there is not. What is proposed to be done is to say that individual cases of resale price maintenance will each be judged by the court whether or not they are in accordance with the public interest.
The hon. Member for Stechford referred to systems of enforcement. As I see it. in these Amendments each case will have to be judged by the court as to whether or not it is in the public interest. It would not even be the Restrictive Practices Court, but either the Chancery courts would be asked to make a value cases, the county courts. The county courts would be asked to make a valued judgment on the public interest, the question of economics, and so on, without the assistance of criteria such as exist in Clause 16 for the detailed guidance of the Restrictive Practices Court.
I think that, upon reflection, the Committee will realise that that would be placing an impossible burden on the county courts, and even upon the Chancery Division of the High Court, in trying to assess the public interest in relation to each and every one of these vastly diverse and varying small cases of individual resale price maintenance.
§ 10.30 p.m.
§ Sir L. Ungoed-ThomasThis part of the Parliamentary Secretary's argument is being addressed, of course, only to the impracticable nature of the proposal, and we therefore approach it on the footing that the rest of the proposal is all right, because obviously we are dealing with the aspect that it is impracticable. The Parliamentary Secretary is suggesting that, even assuming—as we have to for the purposes of this part of the argument—there is something in the argument on public interest, nevertheless it should be 1154 enforced because the particular mechanism which he has provided is not the right mechanism to deal with it. That is the conclusion at which he arrives.
We on this side of the Committee should be perfectly happy for him to take back the Clause and recast it so as to enable the Restrictive Practices Court to deal with all these applications. What we are concerned about at the moment is the particular Amendment rather than the particular forum which the Parliamentary Secretary has chosen for deciding those restrictive practices.
§ Mr. Walker-SmithI do not think the hon. and learned Gentleman has stated the principle quite correctly. If it were true to say that an individual resale price maintenance was generically wrong, then I do not say there would be any practical difficulty in dealing with that situation by legislation. What is impracticable, in my view, is to give effect to a case by case adjudication upon the public interest by the courts, whichever courts they may be. That is the point on impracticability. We have said that individual resale price maintenance normally is an appropriate thing. It exists in law at present, and we have given it this additional right of enforcement which is, as I think has been appreciated by the Committee, offset by the prohibition of collective enforcement.
We believe that the right balance has been struck in the Bill as it stands, and that this Amendment would not add virtue to the Bill and would not be possible in practice.
§ Mr. John Cronin (Loughborough)The Parliamentary Secretary made a very reasonable point when he said resale price maintenance was already enforceable between two parties. That is the law, and nobody could seriously object to it; it is a matter of contract. But I do not think anyone on this side of the Committee would agree to his suggestion that this Clause provides a very small extension of this enforcement of resale price maintenance.
Usually, when there is an action in contract between two parties it is confinable only to those two parties. But, as the Parliamentary Secretary knows perfectly well, there is a long vertical line through which goods pass before they reach the final consumer; they may pass through the hand of perhaps six or even 1155 a dozen different manufacturers, suppliers and processes to the retailer. What Clause 20 will do, if left unamended, is enforce resale price maintenance all the way along the line, so that instead of having resale price maintenance enforced between two parties it will be enforced between six or eight, or ten or twelve parties, which will multiply the effect of it many, many times.
The Parliamentary Secretary also said it is rather impracticable for each court to consider the public interest, and made the point that resale price maintenance had the approval of the Lloyd Jacob Committee. I think that both sides of the Committee agree that resale price maintenance is often desirable in a substantial number of cases; but both sides will also agree that there are cases where it is most undesirable.
I make one possible exception to that, namely, the hon. Member for Heston and Isleworth (Mr. R. Harris), who defended resale price maintenance with such a passion that one sustained the impression that he thought the stop list was British industry's crowning contribution to world economy—a personal idiosyncrasy upon which perhaps the Committee will not dwell too much.
The important thing about this Clause is that we are embarking on a revolutionary process for British industry, and nobody knows what will be the ultimate effect of this Bill. For that reason the Clause should be tied up very closely and carefully so that the courts know exactly where they stand. In discussing a previous Amendment, the Parliamentary Secretary said that an injunction is a discretionary procedure. That is perfectly true, and if we look at subsection (4) we see that it contains the words, "if it thinks fit". I submit that that discretion is not adequate but that the court should have more exact guidance. That is what the Amendment would provide to the court.
The hon. Member for Orkney and Shetland (Mr. Grimond) raised what appeared to be a valid objection to the Amendment. He said that two courts would have to decide on matters of public interest if the Amendment were accepted. I would point out to the hon. Member that even without the Amendment no less than three courts will speak on matters of public interest because not only the 1156 Restrictive Practices Court but the Court of Appeal and the Law Lords of another place would all speak on that matter. So the point about additional courts being able to give opinions on the public interest should not seriously weigh in this question.
Obviously there is no objection to resale price maintenance being enforced when it is in the public interest, but there are a large number of cases in which it would be very detrimental to the public interest. As the Clause stands, without amendment, the court would have no discretion at all and no guidance. There are cases in which resale price maintenance would deprive the public of low cost distribution. There will be occasions where some new form of sales service such as a self-service stores would enable goods to be sold much more cheaply to the public, but, if the traders concerned sold goods at low prices they would be immediately prevented from doing so by the court. That is something in which the public interest would be seriously infringed and the court would have no discretion and no guidance in dealing with that matter.
There will be occasions when the introduction of competitive goods will be held up simply because manufacturers are prevented from selling them at competitive prices opposed to other manufacturers. There again the court would have no discretion and no guidance. There will be occasions when a particular method of trading would be especially favourable to the public interest—for example, in areas where there are few shops and customers have no access to a wide variety of goods. In that case postal trading would be of enormous value and goods could be sold much more cheaply. There again the court would have no discretion and no guidance but would be obliged to enforce the retail prices fixed by the manufacturers.
I could give numerous examples, such as that of the village shop which has a large stock of goods which are deteriorating. What is to be done if those goods cannot be sold off cheaply? Are they to rot on the shelves? Obviously it would be to the public interest that they should be sold at lower prices. There are occasions when a valuable retail organisation might be in financial difficulties and, to obtain relief, might wish to sell a large part of the stock but be unable to do 1157 anything about it because the retailer is obliged to sell at the prices fixed by the manufacturer.
These four Amendments are all valuable contribution to the drafting of the Bill, and I would suggest that the parliamentary secretary takes them into his
§ serious consideration so that they can, to some extent, be incorporated into the Bill.
§ Question put, That those words be there added:—
§ The Committee divided: Ayes 163, Noes 206.
1159| Division No. 176.] | AYES | [10.40 p.m. |
| Ainsley, J. W. | Gordon Walker, Rt. Hon. P. C. | Neal, Harold (Bolsover) |
| Allaun, Frank (Salford, E.) | Grey, C. F. | Oliver, G. H. |
| Allen, Arthur (Bosworth) | Griffiths, David (Rother Valley) | Oram, A. E. |
| Allen, Scholefield (Crewe) | Griffiths, Rt. Hon. James (Llanelly) | Orbach, M. |
| Awbery, S. S. | Griffiths, William (Exchange) | Oswald, T. |
| Bacon, Miss Alice | Grimond, J. | Owen, W.J. |
| Baird, J. | Hall, Rt. Hn. Glenvil (Colne Valley) | Paget, R. T. |
| Bence, C. R. (Dunbartonshire, E.) | Hannan, W. | Paling, Rt. Hon. W. (Dearne Valley) |
| Benson, C. | Harrison, J. (Nottingham, N.) | Paling, Will T. (Dewsbury) |
| Beswick, F. | Hayman, F. H. | Parker, J. |
| Blyton, W. R. | Healey, Denis | Pearson, A. |
| Boardman, H. | Henderson, Rt. Hn. A. (Rwly Regis) | Peart, T. F. |
| Bottomley, Rt. Hon. A. G. | Hobson, C. R. | Plummer, Sir Leslie |
| Bowden, H. W. (Leicester, S.W.) | Holmes, Horace | Popplewell, E. |
| Bowen, E. R. (Cardigan) | Holt, A. F. | Price, Philips (Gloucestershire, W.) |
| Bowles, F. C. | Houghton, Douglas | Proctor, W. T. |
| Boyd, T. C. | Howell, Denis (All Saints) | Randall, H. E. |
| Braddock, Mrs. Elizabeth | Hughes, Cledwyn (Anglesey) | Roberts, Albert (Normanton) |
| Brockway, A. F. | Hughes, Emrys (S. Ayrshire) | Roberts, Goronwy (Caernarvon) |
| Broughton, Dr. A. D. D. | Hughes, Hector (Aberdeen, N.) | Ross, William |
| Burke, W. A. | Irving, S. (Dartford) | Short, E. W. |
| Burton, Miss F. E. | Janner, B. | Silverman, Julius (Aston) |
| Butler, Herbert (Hackney, C.) | Jay, Rt. Hon. D. P. T. | Simmons, C. J. (Brierley Hill) |
| Butler, Mrs. Joyce (Wood Green) | Jeger, George (Goole) | Skeffington, A. M. |
| Castle, Mrs. B. A. | Jenkins, Roy (Stechford) | Slater, J. (Sedgefield) |
| Champion, A. J. | Johnson, James (Rugby) | Sorensen, R. W. |
| Chapman, W. D. | Jones, Rt. Hn. A. Creech (Wakefield) | Stones, W. (Consett) |
| Chetwynd, G. R. | Jones, David (The Hartlepools) | Sylvester, G. O. |
| Coldrick, W. | Jones, Jack (Rotherham) | Taylor, Bernard (Mansfield) |
| Collick, P. H. (Birkenhead) | Jones, J. Idwal (Wrexham) | Taylor, John (West Lothian) |
| Collins, V. J. (Shoreditch & Finsbury) | Jones, T. W. (Merioneth) | Thomas, Iorwerth (Rhondda, W.) |
| Corbet, Mrs. Freda | King, Dr. H. M. | Thomson, George (Dundee, E.) |
| Craddock, George (Bradford, S.) | Lawson, G. M. | Thornton, E. |
| Cronin, J. D. | Ledger, R. J. | Timmons, J. |
| Cullen, Mrs. A. | Lee, Frederick (Newton) | Tomney, F. |
| Dalton, Rt. Hon. H. | LeeMiss Jennie (Cannock) | Ungoed-Thomas, Sir Lynn |
| Darling, George (Hillsborough) | Logan, D. G. | Usborne, H. C. |
| Davies, Rt. Hon. Clement (Montgomery) | Mabon, Dr. J. Dickson | Wade, D. W. |
| Davies, Harold (Leek) | MacColl, J. E. | Warbey, W. N. |
| Deer, G. | McGhee, H. G. | Weitzman, D. |
| Dodds, N. N. | McGovern, J. | West. D. G. |
| Donnelly, D. L. | McInnes, J. | Wheeldon, W. E. |
| Ede, Rt. Hon. J. C. | McKay, John (Wallsend) | White, Mrs. Eirene (E. Flint) |
| Edwards, Robert (Bilston) | McLeavy, Frank | White, Henry (Derbyshire, N.E.) |
| Edwards, W. J. (Stepney) | MacMillan, M. K. (Western Isles) | Willey, Frederick |
| Evans, Albert (Islington, S.W.) | Mallalieu, E. L. (Brigg) | Williams, Rev. Llywelyn (Ab'tillery) |
| Evans, Edward (Lowestoft) | Mann, Mrs. Jean | Williams, W. R. (Openshaw) |
| Evans, Stanley (Wednesbury) | Mason, Roy | Willis, Eustace (Edinburgh, E.) |
| Fernyhough, E. | Mikardo, Ian | Winterbottom, Richard |
| Finch, H. J. | Monslow, W. | Woodburn, Rt. Hon. A. |
| Fletcher, Eric | Moody, A. S. | Woof, R. E. |
| Forman, J. C. | Morris, Percy (Swansea, W.) | Yates, V. (Ladywood) |
| Fraser, Thomas (Hamilton) | Moss, R. | Zilliacus, K. |
| Gibson, C W. | Moyle, A. | |
| Gooch, E. G. | Mulley, F. W. | TELLERS FOR THE AYES: |
| Mr. Price and Mr. Wilkins. | ||
| NOES | ||
| Agnew, Cmdr. P. G. | Baxter, Sir Beverley | Brooman-White, R. C. |
| Aitken, W. T. | Bell, Philip (Bolton, E.) | Browne, J. Nixon (Craigton) |
| Alport, C. J. M. | Bidgood, J. C. | Bryan, P. |
| Amery, Julian (Preston, N.) | Biggs-Davison, J. A. | Carr, Robert |
| Armstrong, C. W. | Birch, Rt. Hon. Nigel | Cary, Sir Robert |
| Ashton, H. | Bishop, F. P. | Channon H. |
| Baldock, Lt.-Cmdr. J. M. | Body, R. F. | Clarke, Brig. Terence (Portsmth, W.) |
| Baldwin, A. E. | Bossom, Sir A. C. | Cole, Norman |
| Balniel, Lord | Boyd-Carpenter, Rt. Hon. J. A. | Cordeaux, Lt.-Col. J. K. |
| Barber, Anthony | Boyle, Sir Edward | Corfield, Capt. F. V. |
| Barlow, Sir John | Braine, B. R. | Crouch, R. F. |
| Barter, John | Braithwaite, Sir Albert (Harrow, W.) | Currie, G. B. H. |
| Dance, J. C. G. | Johnson, Howard (Kemptown) | Pickthorn, K. W. M. |
| D'Avigdor-Coldsmid, Sir Henry | Joseph, Sir Keith | Pilkington, Capt. R. A. |
| Deedes, W. F. | Joynson-Hicks, Hon. Sir Lancelot | Pitt, Miss E. M. |
| Digby, Simon Wingfield | Keegan, D. | Pott, H. P. |
| Donaldson, Comdr. C. E. McA. | Kerby, Capt. H. B. | Price, Henry (Lewisham, W.) |
| Doughty, C. J. A. | Kerr, H. W. | Profumo, J. D. |
| Drayson, C. B, | Kershaw, J. A. | Raikes, Sir Victor |
| du Cann, E. D. L. | Lambert, Hon. G. | Redmayne, M. |
| Eden, J. B. (Bournemouth, West) | Lambton, Viscount | Remnant, Hon. P. |
| Elliot, Rt. Hon. W. E. | Lancaster, Col. C. G. | Renton, D. L. M. |
| Emmet, Hon. Mrs. Evelyn | Langford-Holt, J.A. | Rippon, A. G. F. |
| Errington, Sir Erie | Leather, E. H. C. | Robinson, Sir Roland (Blackpool, S.) |
| Farey-Jones, F. W. | Leavey, J. A. | Roper, Sir Harold |
| Fell, A. | Leburn, W. G. | Ropner, Col. Sir Leonard |
| Finlay, Graeme | Legge-Bourke, Maj. E. A. H. | Schofield, Lt.-Col. W. |
| Fisher, Nigel | Legh, Hon. Peter (Petersfield) | Scott-Miller, Cmdr. R. |
| Freeth, D. K. | Lindsay, Martin (Solihull) | Sharpies, R. C. |
| Galbraith, Hon. T. G. D. | Linstead, Sir H. N. | Shepherd, William |
| Garner-Evans, E. H. | Lloyd, Maj. Sir Guy (Renfrew, E.) | Simon, J. E. S. (Middlesbrough, W.) |
| George, J. C. (Pollok) | Lloyd-George, Maj. Rt. Hon. G. | Smithers, Peter (Winchester) |
| Gibson-Watt, D. | Longden, Gilbert | Speir, R. M, |
| Glover, D. | Lucas-Tooth, Sir Hugh | Stanley, Capt. Hon. Richard |
| Gower, H.R. | Macdonald, Sir Peter | Stevens, Geoffrey |
| Graham, Sir Fergus | Mackeson, Brig. Sir Harry | Steward, Harold (Stockport, S.) |
| Grant-Ferris, Wg Cdr. R. (Nantwich) | McKibbin, A. J. | Steward, Sir William (Woolwich, W.) |
| Green, A. | Mackie, J. H. (Galloway) | Stoddart-Scott, Col. M. |
| Gresham Cooke, R. | McLaughlin, Mrs. P. | Studholme, H. G. |
| Grimston, Sir Robert (Westbury) | Maclay, Rt. Hon. John | Summers, G. S. (Aylesbury) |
| Grosvenor, Lt.-Col. R. G. | Maclean, Fitzroy (Lancaster) | Taylor, Sir Charles (Eastbourne) |
| Hall, John (Wycombe) | McLean, Neil (Inverness) | Taylor, William (Bradford, N.) |
| Harris, Frederic (Croydon, N.W.) | Macleod, Rt. Hn. Iain (Enfield, W.) | Teeling, W. |
| Harris, Reader (Heston) | MacLeod, John (Ross & Cromarty) | Thomas, Leslie (Canterbury) |
| Harrison, A. B. C. (Maldon) | Maitland, Hon. Patrick (Lanark) | Thomas, P. I. M. (Conway) |
| Harrison, Col. J. H. (Eye) | Manningham-Buller, Rt. Hn. Sir R. | Thorneycroft, Rt. Hon. P. |
| Harvey, Air care. A. V. (Macclesfd) | Markham, Major Sir Frank | Thornton-Kemsley, C. N. |
| Harvey, John (Walthamstow, E.) | Marlowe, A. A. H. | Tiley, A. (Bradford, W.) |
| Head, Rt. Hon. A. H. | Marples, A. E. | Tilney, John (Wavertree) |
| Heald, Rt. Hon. Sir Lionel | Maydon, Lt.-Comdr, S. L. C. | Touche, Sir Gordon |
| Heath, Rt. Hon. E. R. C. | Medlicott, Sir Frank | Turner, H. F. L. |
| Hill, Rt. Hon. Charles (Luton) | Milligan, Rt. Hon. W. R. | Tweedsmuir, Lady |
| Hill, Mrs. E. (Wythenshawe) | Molson, A. H. E. | Vane, W. M. F. |
| Hirst, Geoffrey | Morrison, John (Salisbury) | Vickers, Miss J. H. |
| Holland-Martin, C. J. | Mott-Radclyffe, C. E. | Vosper, D. F. |
| Hornsby-Smith, Miss M. P. | Nabarro, G. D. N. | Wakefield, Edward (Derbyshire, W.) |
| Horobin, Sir Ian | Nairn, D. L. S. | Walker-Smith, D. C. |
| Howard, Hon. Greville (St. Ives) | Neave, Alrey | Wall, Major Patrick |
| Howard, John (Test) | Nicholls, Harmar | Ward, Dame Irene (Tynemouth) |
| Hudson, Sir Austin (Lewisham, N.) | Nicolson, N. (B'n'm'th, E. A Chr'ch) | Waterhouse, Capt. Rt. Hon. C. |
| Hudson, W. R. A. (Hull, N.) | Noble, Comdr. A. H. P. | Whitelaw, W. S. I. (Penrith & Border) |
| Hughes Hallett, Vice-Admiral J. | Oakshott, H. O. | Williams, Paul (Sunderland, S.) |
| Hughes-Young, M. H. C. | O'Neill, Hn. Phelim (Co. Antrim, N.) | Wills, G. (Bridgwater) |
| Hurd, A. R. | Orr, Capt. L. P. S. | Wilson, Geoffrey (Truro) |
| Hylton-Foster, Sir H. B. H. | Orr-Ewing, Charles Ian (Hendon, N.) | Woollam, John Victor |
| Irvine, Bryant Godman (Rye) | Osborne, C. | Yates, William (The Wrekin) |
| Jenkins, Robert (Dulwich) | Page, R. G. | |
| Jennings, J. C. (Burton) | Pannell, N. A. (Kirkdale) | TELLERS FOR THE NOES: |
| Johnson, Dr. Donald (Carlisle) | Partridge, E. | Mr. R. Thompson aod Mr. Godber. |
| Johnson, Eric (Blackley) | Peyton, J. W. W. |
§ Mr. E. FletcherI beg to move, in page 17, line 43, at the end, to add:
(5)The Board of Trade may after receipt of a recommendation to that effect of the Monopolies Commission by order direct that this section shall cease to have effect (subject to such saving or transitional provisions as may be contained in the order) in relation to any supplier of goods of a class prescribed by the Board of Trade as being goods in respect of which the individual enforcement by legal proceedings of conditions as to resale prices is contrary to the public interest.(6) The powers of the Board of Trade to make orders under this section shall be exercised by Statutory Instrument; and any statutory instrument containing such rules shall be laid before Parliament after having been made.In view of the debate which has just concluded, I think that discussion on this 1160 Amendment can be quite brief. In a sense it follows on the debate we have just had. The point is to give the President of the Board of Trade another opportunity of meeting the case which we put on the last Amendment. I do not want to reiterate the arguments which were put by some of my hon. Friends on earlier Amendments.Our case is, as in fact the Parliamentary Secretary practically conceded, that there will be some cases in which individual resale price maintenance is a bad thing and contrary to the public interest. In fact, there are some near monopolies where individual resale price maintenance is indistinguishable from collective resale price maintenance. Reference was 1161 made to the Report of the Monopolies Commission on the Supply and Export of Pneumatic Tyres which came to that conclusion, though it is true it was by a majority. That is an illustration of one commodity in respect of which, as is now shown, at any rate by a majority of the Commission, individual resale price maintenance ought to be stopped, ought to be condemned, because it is equivalent to collective resale price maintenance.
The Parliamentary Secretary said that resale price maintenance can be enforced today as between the manufacturer and the wholesaler, but Clause 20 carries the matter a stage further. It gives an additional power to stop by legal methods, through the courts, a practice which is contrary to the public interest. The Parliamentary Secretary said that one reason why he could not accept the earlier Amendment was that it would not be fair to give the court responsibility for having to judge, by a case-by-case method, whether any particular commodity came within the class of commodities where individual price maintenance amounted to collective resale price maintenance.
This Amendment would deprive the President of the Board of Trade of that answer which was given on an earlier Amendment. The Amendment would give the Board of Trade the power, on a recommendation of the Monopolies Commission, by order to say that as regards a particular article or commodity this Clause should no longer operate. The Board of Trade would have full discretion whether or not to make an order. There is nothing obligatory about it.
This is a permissive power which would be available to the Board of Trade, on the recommendation of the Commission. The Board may want to use the power in connection with tyres or it may not. It may take the view—I hope it does not—that the minority view is preferable to that of the majority; but there are other commodities which would, in due course, be investigated by the Commission in connection with which there might be a unanimous result or a decisive majority. 1162 All we ask is that the Board of Trade should seize the opportunity which we are presenting to it, by the Amendment—not of putting an invidious task upon the court but of having this power where, after Investigation by the Monopolies Commission, it has been established that individual resale price maintenance works against the common interest and therefore ought to be stopped.
I very much hope that the Amendment will be accepted. The Report about tyres was published after the right hon. Gentleman had announced his general plan of the form of the Bill. Many people have recognised that the Report on that industry posed a dilemma for the President of the Board of Trade. It is obviously most unsatisfactory, in view of that majority Report condemning individual resale price maintenance, deliberately to flout the verdict of the Commission and to give to manufacturers in that industry an additional power to enforce their system. Here is an opportunity which I hope that the right hon. Gentleman will accept.
§ Mr. P. ThorneycroftAs the hon. Member for Islington, East (Mr. E. Fletcher) said, this Amendment is distinct from the Amendments moved earlier, but it follows logically after them. The proposal here is to erect some new arrangement whereby the right of individual enforcement should be challenged. At an earlier stage I was pressed from some quarters to provide some machinery whereby the making unlawful of collective enforcement could be challenged in a particular case, and I rejected it and pointed out that once we did that, every case would be brought forward, and it would, in effect, bring the whole principle of resale price maintenance out of Part II of the Bill and into Part I.
To some extent the same arguments apply in the case of individual enforcement. We have said, in the Bill, as a matter of policy, that in place of the old collective enforcement we shall give this new legal right of enforcement in the courts to individual manufacturers. In fact, however, where there is a monopoly seeking individually to enforce prices—a monopoly in the technical sense—where more than one-third of the goods are contained within the compass of the 1163 arrangement the matter is referable to the Monopolies Commission under existing law, and that is not affected by the Bill. So the existing law goes some way towards meeting—
§ Mr. E. FletcherBut if the Monopolies Commission reports that individual price maintenance as regards a particular commodity should be stopped, what are the Government going to do about it? How can they give effect to it unless they have power, as suggested in this Amendment, to say that Clause 20 shall cease to apply to that commodity?
§ Mr. ThorneycroftI understand that they could do so, although I am not saying that they would. I am not prejudging the issue. As I understand the law, and it is my purpose solely to inform the Committee how the Bill stands at this moment, the Monopolies and Restrictive Practices (Inquiry and Control) Act, 1948, remains in existence, and if more than one-third of the goods were covered by a monopoly, which was employing individual price enforcement, it would be subject to investigation and could be made—I am not saying that it would be made—the subject of an order to the courts.
§ Sir L. Ungoed-ThomasThen surely the President is going to accept this Amendment?
§ Mr. ThorneycroftIt is not necessary to accept the Amendment.
But the Amendment would go further, and would apply to any case of individual enforcement. That I am not prepared to accept. The monopolies legislation as it stands is satisfactory from this point of view. Where one gets a large and powerful group, or single corporation, controlling more than one-third of the trade, the matter is examinable by the Commission.
§ Mr. FletcherThat cannot be so. It is true that the matter is examined under the 1948 Act, but that is being modified by this Bill, which is going to supersede the Act of 1948. It will supersede it in a great many respects.
I think that the right hon. Gentleman is mistaken if he thinks that he will have power, after the Bill is passed, to exclude 1164 the operation of the new Clause merely because there is a recommendation from the Monopolies Commission. There cannot possibly be anything in the Monopolies and Restrictive Practices Act, 1948, which gives the President power to exclude a particular commodity from the effect of what will be Section 20 of a 1956 Act.
§ 11.0 p.m.
§ Mr. ThorneycroftI am advised, and I believe, that the provisions of the Monopolies and Restrictive Practices Act, 1948, remain intact even after the passing of this Bill. Naturally there will be plenty of opportunity between now and Report to check that point. Where particular goods are covered as to one-third, that matter would be referable, and that is a perfectly proper provision. I am not saying that it would necessarily be used in a particular case or that it would be widely used. I am not making any declaration of policy. I am merely saying that the provision is there and that I think it should remain there. I am declaring the position, which I think should go a substantial way towards meeting the point made by the Opposition.
§ Mr. WadeMay I press this point a little further? It would obviously be anomalous if this procedure gave added power to concerns that had been condemned by the Monopolies Commission. This seems to be a matter of policy and not just one of interpretation. I am anxious to know what safeguards the President has in mind to employ to ensure that this new procedure does not give added power to monopolies or semi-monopolies. Do the Government intend to use the procedure of the Monopolies Commission to overcome the difficulty created by the Clause?
§ Mr. BeswickThe President of the Board of Trade has assured us with some force that powers to refer to the Monopolies Commission remain. But suppose the right hon. Gentleman refers an industry to the Commission because it covers more than one-third of the goods and is known to be enforcing a price, and the Commission finds that it has been established that this near-monopoly is indeed enforcing the price individually, as provided in law. What happens then? 1165 The Commission makes a recommendation to the President, but what can the right hon. Gentleman do, when he has this provision in the Bill?
Mr. ThomeycroftIt is not a question of fact—the fact would probably be undisputed in a particular case—it would be a question of the public interest. Hon. Members have referred to the Report on the tyre industry, but that was a very narrowly divided Report. I am very far from saying that it does not give any clear indication on which one should necessarily come to a decision. I am not deciding the matter now. All that I am saying is that where there is a monopoly, where more than one-third of the goods are covered, it can be referred to the Monopolies Commission, and if the responsible authority so decide—the Board of Trade in the case of tyres, the Ministry of Supply in some other cases—an order can be made. I am satisfied that that
§ is what the law should be and in fact is at present.
§ Sir L. PlummerHas the superior authority ever issued an order?
§ Mr. ThorneycroftOn resale price maintenance?
§ Sir L. PlummerOn practices against the public interest.
Mr. ThomeycroftThere have been twelve Reports and an order has been made in respect only of dental goods, which were the subject of the first Report. In all other cases undertakings have been given by the industry, sometimes after discussion with the responsible authority, either to drop the practices or to pursue them in a different way.
§ Question put, That those words be there added:—
§ The Committee divided: Ayes 123, Noes 172.
1167| Division No. 177.] | AYES | [11.5 p.m. |
| Ainsley, J. W. | Gibson, C. w. | Oram, A. E. |
| Allaun, Frank (Salford, E.) | Gordon Walker, Rt. Hon. P. C. | Owen, W. J. |
| Allen, Arthur (Bosworth) | Grey, C. F. | Paget, R. T. |
| Awbery, S. S. | Griffiths, David (Rother Valley) | Paling, Rt. Hon. W. (Dearne Valley) |
| Baird, J. | Griffiths, William (Exchange) | Paling, Will T. (Dewsbury) |
| Beswick, F. | Grimond, J. | Parker, J. |
| Blyton, W. R. | Hall, Rt. Hn. Glenvil (Colne Valley) | Pearson, A. |
| Boardman, H. | Hannan, W. | Plummer, Sir Leslie |
| Bottomley, Rt. Hon. A. C | Harrison, J. (Nottingham, N.) | Popplewell, E. |
| Bowden, H. W. (Leicester, S.W.) | Hayman, F. H. | Price, J. T. (Westhoughton) |
| Bowen, E. R. (Cardigan) | Healey, Denis | Price, Philips (Gloucestershire, W.) |
| Boyd, T. C. | Henderson, Rt. Hn. A. (Rwly Regis) | Prootor, W. T. |
| Braddock, Mrs. Elizabeth | Houghton, Douglas | Randall, H. E. |
| Brockway, A. F. | Howell, Denis (All Saints) | Roberts, Goronwy (Caernarvon) |
| Broughton, Dr. A. D. D. | Hughes, Cledwyn (Anglesey) | Ross, William |
| Brown, Rt. Hon. George (Belper) | Hughes, Emrys (S. Ayrshire) | Short, E. W. |
| Burke, W. A. | Hughes, Hector (Aberdeen, N.) | Silverman, Julius (Aston) |
| Butler, Herbert (Hackney, C.) | Irving, S.(Dartford) | Simmons, C. J. (Brierley Hill) |
| Castle, Mrs. B. A. | Janner, B. | Skefffington, A. M. |
| Champion, A. J. | Jay, Rt. Hon. D. P. T. | Slater, J. (Sedgefield) |
| Chetwynd, C. R. | Jeger, George (Goo'e) | Sorensen, R. W. |
| Coldrick, W. | Jenkins, Roy (Stechford) | Stones, W. (Consett) |
| Collick, P. H. (Birkenhead) | Johnson, James (Rugby) | Sylvester, G. O. |
| Collins, V. J.(Shoreditch & Finsbury) | Jones, David (The Hartlepools) | Thomas, Iorwerth (Rhondda, W.) |
| Corbet, Mrs. Freda | Jones, Jack (Rotherham) | Thornton, E. |
| Craddock, George (Bradford, S.) | Jones, J. Idwal (Wrexham) | Ungoed-Thomas, Sir Lynn |
| Cronin, J. D. | Jones, T. W. (Merioneth) | Usborne, H. C. |
| Cullen, Mrs. A. | King, Dr. H. M. | Wade, D. W. |
| Dalton, Rt. Hon. H. | Lawson, G. M. | West, D. C. |
| Darling, George (Hillsborough) | Lee, Frederick (Newton) | Wheeldon, W. E. |
| Davies, Harold (Leek) | Logan, D. G. | White, Mrs. Eirene (E. Flint) |
| Deer, G. | Mabon, Dr. J. Dickson | White, Henry (Derbyshire, N.E.) |
| Dodds, N. N. | MacColl, J. E. | Willey, Frederick |
| Donnelly, D. L. | McGhee, H. G. | Williams, Rev. Llywelyn (Ab'tilery) |
| Ede, Rt. Hon. J. C. | McInnes, J. | Williams, W. R. (Openshaw) |
| Edwards, Robert (Bilston) | Mallalieu, E. L. (Brigg) | Winterbottom, Richard |
| Edwards, W. J. (Stepney) | Monslow, W. | Woof, R. E. |
| Evans, Stanley (Wednesbury) | Moody, A. S. | Yates, V. (Ladywood) |
| Fernyhough, E. | Morris, Percy (Swansea, W.) | Zilliacus, K. |
| Fletcher, Eric | Moss, R. | |
| Forman, J. C. | Moyle, A. | TELLERS FOR THE AYES: |
| Fraser, Thomas (Hamilton) | Mulley, F. W. | Mr. Holmes and Mr. Wilkins. |
| NOES | ||
| Agnew, Cmdr. P. G. | Harris, Reader (Heston) | Nicolson, N. (B'n'm'th, E. & Chr'ch) |
| Aitken, W. T. | Harrison, A. B. C. (Maldon) | Noble, Comdr. A. H. P. |
| Alport, C. J. M. | Harvey, Air Cdre. A. V. (Macclesfd) | Oakshott, H. D. |
| Amery, Julian (Preston, N.) | Harvey, John (Walthamstow, E.) | O'Neill, Hn. Phelim (Co. Antrim, |
| Armstrong, C. W. | Heald, Rt. Hon. Sir Lionel | Orr-Ewing, Charles Ian (Hendon, N.) |
| Ashton, H. | Heath, Rt. Hon. E. R. G. | Page, R. G. |
| Baldock, Lt.-Cmdr. J. M. | Hill, Mrs. E. (Wythenshawe) | Partridge, E. |
| Baldwin, A. E. | Hirst, Geoffrey | Peyton, J. W. W. |
| Balniel, Lord | Holland-Martin, C. J. | Pickthorn, K. W. M. |
| Barber, Anthony | Hornsby-Smith, Miss M. P. | Pilkington, Capt. R. A. |
| Barlow, Sir John | Horobin, Sir Ian | Pitt, Miss E. M. |
| Barter, John | Howard, John (Test) | Pott, H. P. |
| Baxter, Sir Beverley | Hudson, Sir Austin (Lewisham, N.) | Price, Henry (Lewisham, W.) |
| Bell, Philip (Bolton, E.) | Hudson, W. R. A. (Hull, N.) | Profumo, J. D. |
| Biggs-Davison, J, A. | Hughes Hallett, Vice-Admiral J. | Raikes, Sir Victor |
| Birch, Rt. Hon. Nigel | Hughes-Young, M. H. C. | Redmayne, M. |
| Bishop, F. P. | Hylton-Foster, Sir H. B. H. | Remnant, Hon. P. |
| Body, R. F. | Irvine, Bryant Godman (Rye) | Robinson, Sir Roland (Blackpool, |
| Bossom, Sir A. C. | Jenkins, Robert (Dulwich) | Ropner, Col. Sir Leonard |
| Boyd-Carpenter, Rt. Hon. J. A. | Jennings, J. C. (Burton) | Schofield, Lt.-Col.W. |
| Boyle, Sir Edward | Johnson, Dr. Donald (Carlisle) | Scott-Miller, Cmdr. R. |
| Braine, B. R. | Johnson, Eric (Blackley) | Sharpies, R. C. |
| Braithwaite, Sir Albert (Harrow, W.) | Joseph, Sir Keith | Shepherd, William |
| Carr, Robert | Joynson-Hioks, Hon. Sir Lancelot | Simon, J. E. S. (Middlesbrough, |
| Cary, Sir Robert | Keegan, D. | Smithers, Peter (Winchester) |
| Channon, H. | Kerby, Capt. H. B. | Speir, R. M. |
| Clarke, Brig. Terence (Portemth, W.) | Kerr, H. W. | Stevens, Geoffrey |
| Cole, Norman | Kershaw, J. A. | Steward, Harold (Stockport, S.) |
| Cordeaux, Lt.-Col. J. K. | Lambert, Hon. G. | Steward, Sir William (Woolwich, W.) |
| Corfield, Capt. F. V. | Lambton, Viscount | Stoddart-Scott, Col. M. |
| Crouch, R. F. | Langford-Holt, J. A. | Studholme, H. G. |
| Currie, G. B. H. | Leather, E. H. C. | Summers, G. S. (Aylesbury) |
| Dance, J. C. G. | Leavey, J. A. | Teeling, W. |
| D'Avigdor-Goldsmid, Sir Henry | Legge-Bourke, Maj. E. A. H. | Thomas, Leslie (Canterbury) |
| Deeds, W. F. | Legh, Hon. Peter (Petersfield) | Thomas, P. J. M. (Conway) |
| Digby, SimonWingfield | Lindsay, Martin (Solihull) | Thompson, Lt.-Cdr. R. (Croydon, S.) |
| Drayson, G. B. | Linstead, Sir H. N. | Thorneycroft, Rt. Hon. P. |
| du Cann, E. D. L. | Longden, Gilbert | Thornton-Kemsley, C. N. |
| Eden, J. B. (Bournemouth, West) | Lucas-Tooth, Sir Hugh | Tiley, A. (Bradford, W.) |
| Errington, Sir Eric | Macdonald, Sir Peter | Tilney, John (Wavertree) |
| Farey-Jones, F. W. | Mackeson, Brig. S.r Harry | Touche, Sir Gordon |
| Fell, A. | McKibbin, A. J. | Turner, H. F. L. |
| Finlay, Graeme | Mackle, J. H. (Galloway) | Vickers, Miss J. H. |
| Fisher, Nigel | McLaughlin, Mr. P. | Vosper, D. F. |
| Freeth, D. K. | Maclay, Rt. Hon. John | Wakefield, Edward (Derbyshire, W.) |
| Galbraith, Hon. T. G. D. | Maclean, Fitzroy (Lancaster) | Walker-Smith, D. C. |
| Garner-Evans, E. H. | Macleod, Rt. Hn. Iain (Enfield, W.) | Wall, Major Patrick |
| George, J. C. (Pollok) | Manningham-Buller, R. Hn. Sir R. | Ward, Dame Irene (Tynemouth) |
| Gibson-Watt, D. | Markham, Major Sir Frank | Waterhouse, Capt. Rt. Hon. C. |
| Glover, D. | Marlowe, A. A. H. | Whitelaw, W. S. I. (Penrith & Border) |
| Godber, J. B. | Maydon, Lt.-Comdr. S. L. C | Williams, Paul (Sunderland, S.) |
| Gower, H. R. | Medlicott, Sir Frank | Wills, G. (Bridgwater) |
| Graham, Sir Fergus | Milligan, Rt. Hon. W. R. | Wilson, Geoffrey (Truro) |
| Grant-Ferris, Wg Cdr. R. (Nantwich) | Molson, A. H. E. | Yates, William (The Wrekin) |
| Green, A. | Morrison, John (Salisbury) | |
| Gresham Cooke, R. | Nabarro, G. D. N. | TELLERS FOR THE NOES: |
| Grosvenor, Lt.-Col. R- C. | Nairn, D. L. S. | Colonel J. H. Harrison and |
| Hall, John (Wycombe) | Neave, Airey | Mr. Bryan. |
| Harris, Frederic (Croydon, N. W.) | Nicholls, Harmar |
§ Motion made, and Question proposed, That the Clause stand part of the Bill.
§ Sir L. Ungoed-ThomasI beg to move, That the Chairman do report Progress and ask leave to sit again.
We have had a debate lasting for several hours upon Clause 20, and although we have also a considerable amount of work still to do, the Opposition has done everything it possibly could have done during the whole of the proceedings so far to expedite the passage of the Bill. Our approach, if I may use the term, has been a businesslike approach. We have wanted to have the 1168 various Clauses and Amendments thoroughly debated but, at the same time, debated in a manner which was economical of time.
No time, I am sure the President of the Board of Trade will agree, has been wasted. There has been no Closure during our discussions; no filibustering, and scarcely a case of an hon. Member being ruled out of order. As an example of what we have tried to do, I would remind the Committee that in the earlier part of today, we took matters at a speed which, perhaps, was not even warrantable in order to get through this Bill as expeditiously as we could.
1169 11.15 p.m.
It is an important and a complex Bill. It affects the whole economy of the country, and it merits full consideration from all parts of the House. We have had speeches on the Bill, not just from the Opposition, but from Government back benchers, and we have had speeches from them—I do not complain of this—f considerable length. On Clause 19, for instance, the debate on the Motion, That the Clause stand part of the Bill, took a considerable time. Back bencher after back bencher on the Government side of the Committee spoke upon it, although their speeches were not addressed to particular Amendments designed to improve the Bill. Again, I am not complaining. All I am saying is that this is a Bill which deserves and requires the attention of all parts of the Committee, and upon which Members in all parts of the Committee have spoken.
This is not, and never has been at any stage, anything like the case where one part of the House is simply trying to press its case at inordinate length to bring pressure to bear on the Government. I am sure that the Presideot recognises that at once. In a Bill of this complexity and importance, it is a matter in which it is not possible to go on for hour after hour and bring to bear the consideration which the Bill deserves and requires.
At this hour, after having concentrated on the Bill, as the President, the Parliamentary Secretary and all of us have done, hour after hour, it just is not possible to go on discussing these matters at a late hour and give them the kind of reasonable approach and the careful consideration which they require. No businessman would conduct his business in the way that the business of the Bill would be conducted if we were to go on into the early hours of the morning. Therefore, my proposal is that we should now adjourn, and that the Government should find the time to deal with this, their own legislation, in a way which is worthy of the subject and its importance.
Mr. P. ThomeycroftI entirely endorse much of what the hon. and learned Gentleman has said. There is no question of any kind of obstruction from any quarter of the Committee. Hon. and right hon. Gentlemen opposite have co-operated fully. They have debated force 1170 fully and fairly but have co-operated fully in dealing with this large, complicated and important matter.
The fact remains, however, that we have spent seven days on the Bill and we are now at Clause 20, about to discuss the Motion, That the Clause stand part of the Bill. We have a number of Clauses still ahead of us. My belief is that if we can continue to show the co-operation which we have been able to show on the previous Clauses, we can make progress and finish the Bill.
§ Mr. BeswickWhen?
§ Mr. ThorneycroftWe can finish it tonight.
We have had seven days' full debate on the Floor of the House. There can be no question of full opportunity not having been given. I emphasise that there is no suggestion on my part about hon. Members obstructing the debate. At the same time, I ask for co-operation in making progress with the Bill.
§ Sir L. Ungoed-ThomasThat is a most disappointing and unsatisfactory reply. When the President himself says that we have not wasted time on the Bill, it is no answer at all to say that we have reached only Clause 20 in seven days. The measure of the treatment of the Bill is not the number of days we have spent on it or the number of Clauses we have considered. The measure of whether it has been properly dealt with is whether time has been wasted on it. The time spent on this Bill is the amount of time that has been required to be spent on it. It is impossible to give this Bill the consideration which it requires, if we are to go on until the early hours of the morning.
The Government brought this Measure forward, and it is for them to find time to deal with it in a proper, businesslike way. They are not doing that. We should not be complaining about sitting until the early hours of the morning had we been obstructive about this Bill, because that would have represented the Government's retort to us, and it would have been perfectly fair Parliamentary fighting. But that is not the position. We have given every assistance to get this Bill through its Committee stage, and the President is aware of that.
1171 The Government are in this position because they have got themselves in such a mess with their programme, and they propose to carry on until the early hours of the morning. That is quite intolerable.
§ Mr. ThorneycroftI hope that the hon. and learned Gentleman will not become too indignant. After all, it is only twenty minutes past eleven. When I first came to the House, and I have not been here so very long, the House never rose before eleven o'clock. It is only twenty minutes past eleven, and I think that we could make some progress.
§ Mr. E. FletcherI do not think that the Government have treated the Opposition with the respect to which they are entitled. As my hon. and learned Friend has said, and as the President of the Board of Trade has acknowledged, there has been no obstruction over this very complicated Bill. It has involved a great deal of careful and concentrated attention. I do not think it fair, either to the Opposition or to the President or the Parliamentary Secretary, that we should be asked to continue into the early hours of the morning.
This is not a matter for the President of the Board of Trade to decide, It concerns the business of the Committee. Where is the Lord Privy Seal? We have the Chief Whip present. I do not know whether he intends to say anything, but I think that someone should send for the Leader of the House. I do not think the right hon. Gentleman is treating the President fairly. The President and the Parliamentary Secretary have had the whole burden of dealing with this Bill. We have not had the Attorney-General here at all, except for one fleeting visit. I do not know whether the right hon. and learned Gentleman understands the Bill or not, but he has not been present, and neither has the Solicitor-General nor the Lord Advocate.
We have now reached the point where the Committee must decide whether we shall adjourn or deal with Part III of the Bill. I would remind hon. Members that the Economist and other papers have stated that Part III is the most important part of the Bill. I do not know whether that is the reason why the Government wish it to be discussed in the night hours, but this is a matter on which the Committee is entitled to guid 1172 ance from the Leader of the House. If it is considered necessary to continue with this Bill tonight, we are entitled to hear from the Leader of the House what is the programme of the Government. What is it which makes it necessary to sit all night considering a Measure of this kind? What other Measures are the Government proposing to bring forward which will take up a great deal of Parliamentary time? I know that there is a Finance Bill, but that is an attenuated affair, which will not take the usual ten or eleven days for the Committee stage.
§ Mr. Ede (South Shields)Do not be too sure about that.
§ Mr. FletcherThat Government have boasted that this is one of the most important Measures that they are asking the House of Commons to deal with this Session. The President of the Board of Trade has acknowledged that the Bill has been dealt with in a businesslike way, and that no time has been wasted. A great deal of time has been taken up by hon. Members on the Tory benches, and a great deal of time by hon. Members of the Liberal Party. I make no complaint about that. They have made several notable contributions. I would say that in proportion to their number we have had more speeches from the Liberal Party on this Bill than from other Parties.
§ Mr. GrimondOf a higher quality.
§ Mr. FletcherI am not talking about quality at the moment, but about quantity.
In relation to its number the Liberal Party has had more time than the Government or the Opposition. Among the Amendments we have to consider are further Liberal Amendments. They may be a strain on the President and on the Parliamentary Secretary. They will be less strain on us, because there are more of us. I ask the Government to think what they are asking the Liberal Party to do. With two or three hon. Members of the Liberal Party it will have to sustain the debate until two or three the morning.
I was hoping that by this time the Leader of the House would have been here to give guidance on what the Committee ought to do. I hope that before the debate on this Motion concludes he will be here to answer some of the questions which have been raised.
§ Mr. MulleyI would like to add a protest to those of my hon. Friends. It seems to me unreasonable that the Committee should be given six days for Part I of the Bill, and should now be asked to take Parts II and III together in one sitting. It has been stated that Part I was dealt with well, and that no time was wasted. The debate has been divided between both sides of the Committee. The parts of the Bill which touch the public closest, that is the Amendments relating to Clause 20, and the Monopolies Commission, with which we have still to deal, are, if anything, of more public interest. They are not the sort of points which should be taken after midnight. If we cannot adjourn now I hope that the President will indicate the time at which he thinks it would be reasonable to conclude the debate.
§ Mr. Hector Hughes (Aberdeen, North)I would ask the President to reconsider his refusal to accept this Motion. I want him to approach the matter reasonably. My first ground is that the Bill is of great importance. It ought, therefore, to be considered by the Committee during the day, and not at midnight, or after midnight, as it will be if this debate continues. This is a Bill which will affect the trade and commerce of the country. The President, and other Ministers, have admitted that during our debates.
Another point to which I would draw attention is the complexity of the Bill. The President has admitted that the Bill is not only of importance to trade and commerce, but that it is of the utmost complexity. Several times he and others have said that it would take lawyers to construe it. The courts will have great difficulty in construing the Bill, and dealing with it adequately. Those two points alone ought to be sufficient to induce the Minister to revise his refusal to adjourn now, so that the Bill may be given the consideration which it ought to get.
But those are not the only points. The debate so far has shown that not only is the Bill important and full of complexity, but that difficult points on it arise not only on the Government side of the Committee, but on the Opposition side. The Minister has said the Opposition have treated this Bill very fairly, that we have not been obstructive. We have put forward constructive Amendments and 1174 discussed them in speeches of no great length, all of which were strictly relevant.
§ Mr. P. Thorneycroftindicated assent.
§ 11.30 p.m.
§ Mr. HughesI am glad to see the Minister nod. In the very words which fell from his lips earlier in this debate he made it clear that he did not think we were obstructive, but were, on the contrary, constructive and trying to make the Bill a better Bill.
The Amendments which have been put forward by the Opposition have been of a character designed to make it a better Bill. Will the Bill be a better Bill if we go on discussing it after midnight, perhaps till one, two, three, four, five—[HON. MEMBERS: "Six, seven, eight, nine, ten, out."] This is not a laughing matter. On the contrary, it is a matter of great importance. One has only to see the light-hearted way in which the Government are treating the words I am uttering to see that they will not give the Bill the consideration it ought to get.
The atmosphere of the Committee is rather lively at the moment. Who can tell how lively it will be in the small hours of the morning? If we go on until those hours, will we have more Ministers here? Will we have the Lord Advocate for Scotland here? Will we have the Attorney-General and the Solicitor-General? Where are they? They ought to be here now, so that the Bill can be given adequate consideration.
I began by suggesting that the Committee should consider this not in a lively way, but in a calm way. I have put these relevant arguments before the President of the Board of Trade. I hope that he and his colleagues will consider them in the calm and judicial way in which I ventured to put them, and will change their minds and adjourn now in the interests of the country.
Mr. P. ThomeycroftI always listen to the persuasive speeches of the hon. and learned Gentleman with great attention, and he has perhaps more of my sympathy than he recognises in some of the appeals which he has addressed to the Committee. At the same time, it is now very nearly twenty-five minutes to midnight; it is not the small hours of the morning yet. As he said, the Committee is in a lively mood; let us seize the 1175 opportunity, while there is still life in us, to press on and at least to pass Clause 20.
§ Mr. EdeI hope that the right hon. Gentleman has not yet said the last word on this issue. I have sat for a good many hours through the debate on each of the seven days, and there is a very good precedent for rest on the seventh day. The right hon. Gentleman, in defiance of well-known precedent, proposes to make the seventh day the one with the hardest work. I have only once spoken in the debate, quite briefly, almost in response to an invitation from the right hon. and learned Member for Chertsey (Sir L. Heald), and what has struck me judging from what right hon. and learned and hon. and learned Gentlemen have said, is that it appears to be a measure that is without precedent in English law. We are making new law. When the hon. Member for Twickenham (Mr. Gresham Cooke) wants to cite a precedent he always tells us that in America they have a law like this. I am not impressed by a country which has regarded Senators McCarthy and McCarran as great legislators.
We have now reached a stage in considering this Measure which to me, listening to it as an amateur in these matters, seems to be dealing with injunctions which may be imposed on small shopkeepers, quite small people who might find their livelihood placed in considerable jeopardy under the Clause to which we shall come back as soon as this Motion is disposed of one way or the other. We shall either come back to it late tonight, early tomorrow morning, or on the next day on which the Committee considers the Bill.
It seems to me that one cannot expect the attention to be given to this Measure between now and 8 or 10 o'clock tomorrow morning that ought to be given to it. Hon. Members on both sides of the Committee who, obviously, have studied the Measure have been expressing their gravest doubts about its effects. The hon. Member for Heston and Isleworth (Mr. R. Harris) has made a number of speeches and is obviously well informed, whether one agrees with him or not. He has expressed the gravest doubts as to what may happen if the Measure becomes law in its present form.
1176 My hon. and learned Friends have been expressing similar views from the point of view of other people. As the son of a small country tradesman, I realise the kind of difficulties which may be put in the way of such tradesmen if the Clause becomes law in its present form, and they find themselves falling into the kind of traps which it is now sought to avoid setting for them if we possibly can avoid that.
I hope that the right hon. Gentleman will feel that he has had a very good discussion today. He admits that there have been no irrelevant speeches and that they have been consistently short. The discussion has taken place on both sides of the Committee with the obvious intention of trying to make the Measure one which, while unprecedented, will achieve the kind of results we all wanted it to achieve when we started.
I am quite sure that anyone, not claiming to be expert in the matter, who has listened to the debates must realise that on both sides of the Committee well-informed hon. Members are very concerned as to what may be the result of this Measure when it becomes law. I cannot think that the Committee will deal adequately with the remaining Clauses and the Schedules, and the problems which they present, if we attempt to finish the Bill between now and the time the House rises from its present sitting.
§ Mr. BeswickThe President paid a very proper tribute to my hon. and learned Friend the Member for Aberdeen, North (Mr. Hector Hughes) and I am sure we all agreed with what the right hon. Gentleman said. It was suggested that my hon. and learned Friend the Member for Gloucester (Mr. Turner-Samuels) might reinforce what my hon. and learned Friend said.
In view of the circumstances, I think the President would do well to clarify the point he made about Clause 20 that he had an open mind on some of those matters, even though on the Amendments to the Clause he was not very forthcoming. If he could say a little more about what he had in mind on Clause 20, I am sure that the Committee would greatly appreciate it.
There comes a time in the affairs of all Ministers in charge of a Bill when they realise that the progress to be made 1177 will be in inverse proportion to the energy expended. We seem to have gone beyond that point this evening. I hope, therefore, that the President will be in a position to give us a little more information and to clarify the point about Clause 20.
§ Mr. JayWe should like to be clear about the offer that the President made in his last remarks. I hope he is trying to be reasonable, if only for his own sake, because I do not suppose that he himself wishes to go on for another ten or twelve hours. Do we understand him to say that he thinks it reasonable to continue this discussion until we have completed Clause 20? If his proposal is that we should continue to the end of Clause 20, and should then suspend this sitting until a more suitable time, I think that most of my right hon. and hon. Friends would be content to do that here and now, but I do not think that they will be so disposed if there is any doubt about that proposal. I hope that he will give us that assurance, and we can then return to the rather more businesslike type of discussion that we have so far had.
§ Mr. G. DarlingI am very worried about Part III of the Bill. I do not want to make a long speech, but rather to put a question to the Minister. Does he want it to go out, when we have finished the Committee stage, that he had so little regard for the work of the Monopolies Commission that its work and future were discussed in the early hours of the morning; that he had so little regard for the Commission's future that he was prepared to discuss all the difficult legal questions involved at such an hour? I sincerely hope that he will take into consideration that we must not discuss the future of the Monopolies Commission in this way.
§ Mr. Roy JenkinsI rise only because the President, greatly to our surprise and disappointment, refuses to say a word to my right hon. Friend the Member for Battersea, North (Mr. Jay). I do ask the right hon. Gentleman to consider very carefully whether he cannot say something more definite at this stage. I appreciate that he is undoubtedly in grave personal difficulties. If it is the Leader of the House who is seeking, against the fairly clear will of the House, to make us go on with this particularly 1178 complex Bill at a particularly inconvenient time, I hope that, whatever instructions he has had, the President will use his own initiative.
He may strengthen his resolve to do that if he casts his mind back to the experience which the Lord Privy Seal himself has had when he has carried the House into all-night sittings against its will. The Lord Privy Seal has considerable experience of all-night sittings. I am sure that the President—and you, Sir Charles—will remember the last occasion when the Lord Privy Seal insisted on carrying the Committee through the consideration of a complex and difficult Bill at a stage when the House had already made considerable progress. The right hon. Gentleman should note that the amount of progress then made was, unfortunately, extremely small during the night, and that the work of the night did more to damage the reputation of the Lord Privy Seal than it did to help the progress of the Bill.
I hope that the President will take note of the lesson to be learned from this, and will not follow too closely any instructions he may have received from the Lord Privy Seal. In particular, I hope that any instructions he may now be receiving from the Government Chief Whip will be more up to date than those he has received from the Lord Privy Seal, and that he may now be in a position to say something.
§ 11.45 p.m.
§ Mr. P. ThorneycroftMay I suggest that a convenient arrangement might be that we should proceed to discuss the Question, "That Clause 20 stand part of the Bill," and that while that is going on some discussion might take place with a view to making an arrangement?
§ Sir L. Ungoed-ThomasOn the understanding that we shall immediately move to report Progress when we have dealt with the Question, "That Clause 20 stand part of the Bill," I agree that that would perhaps be a convenient course to follow, and I dare say it would save time. If that would meet with your approval, Sir Charles, I shall be prepared to withdraw my Motion.
§ The ChairmanI would be quite willing to agree to that course.
§ Sir L. Ungoed-ThomasI beg to ask leave to withdraw the Motion.
§ Motion, by leave, withdrawn.
§ Mr. MulleyI do not apologise for detaining the Committee to discuss this Clause, I hope rather briefly, because it is a Clause of such great importance to trade and industry.
Although the President of the Board of Trade is evidently engaged on other matters for the moment, the Parliamentary Secretary will perhaps agree that it is not a very satisfactory Clause. In fact, as I think the Government now realise, it is much more difficult than they thought to translate into statutory terms the simple recommendation of the Lloyd Jacob Report.
In my submission, the Government have not really faced the logic that it is almost impossible to devise a satisfactory system of individual resale price maintenance on the lines which they have chosen. This is much less satisfactory than the White Paper which was published by the Labour Government, in 1951. It was a great disappointment to us on this side of the Committee that the President having made speeches about the reduction in prices, and so on, which he hopes will flow from this Bill, he has resisted the reasonable Amendments which were moved from these benches to extend the provisions to the co-operative and similar bodies.
The point on which I wish to concentrate is the failure of the Government to give sufficient consideration to the operation of loss-leaders. It may be a matter of definition, but it is not at all clear what is meant by "retail purchase" in subsection (2, a). For example, will it be possible for someone who wants to use recognised goods to buy them by retail purchase in the ordinary way and in that way avoid the provisions of the Clause?
At this time of night perhaps it is not desirable to go very far into the question of the non-signer Clause that was debated earlier, but I think the Government ought to give more consideration than they have to the question of size. It seems that this Bill, as we go through it, is increasing the advantages of the large manufacturer or retailer at the expense of the smaller one. While I agree that the words which were 1180 suggested might not have been appropriate, I believe that some provision on the lines of protecting one retailer who finds that a large retailer in competition with him is abusing him, ought to be considered. We have to consider the practical implications of this matter.
The President of the Board of Trade spoke as though every manufacturer approached all his customers with the fairness of an equity judge. In practice, that is not the case. If one retail firm is very large and another firm is very small, the manufacturer will not take action against the large retailer at the whim and wish of the small one. I think that some provision might be made to incorporate that in the Bill.
I do not want to go into the legal niceties at this time of night, but I thought that in the duel between the hon. and learned Member for Middlesbrough, West (Mr. Simon) and the President of the Board of Trade the hon. and learned Member had the best of it.
I conclude by asking that before we come to this matter again, on Report, the Government might seriously give thought to the whole question of the operation of individual price maintenance, and particularly to the drafting of subsection (4). It seems to me that snoopers will have to be employed before the subsection can be operated. The wording of "any other description" at the end of that subsection is far too wide and the whole operation of this Clause is extremely clumsy. I ask that it be reconsidered before it becomes law.
§ Mr. JayIn the circumstances we do not wish to prolong discussion unduly, but this should be said about the Clause. A strong case can be made out against individual resale price maintenance. I believe that in these days of full employment, when we are all talking about fighting inflation, there is a great deal to be said for price competition. However, in spite of that, I think that for two reasons I should not go so far as to accept the case against individual resale price maintenance altogether.
The first reason is that it can be argued with some force that the manufacturer has a reasonable interest in the price at which his own goods are sold. Secondly, we must pay some attention to the question about loss-leaders, of which so much 1181 has been heard in reports on this subject and from other sources. We seem to meet these loss-leaders rather more in theory than we do in practice. Nevertheless, on the whole, the evidence makes a case for giving the individual manufacturer the power to enforce individual price maintenance; but we do not agree that it is justifiable to give the power to individual manufacturers in the unqualified form in which the right hon. Gentleman gives it in the Bill.
We are, after all, giving the power to suppliers to enforce, through the courts, on third or fourth parties who have not entered into the contract, a price dictated by the manufacturer. Although we have heard a great deal today, mainly from the hon. Member for Heston and Isleworth (Mr. R. Harris), about the desire, as he sees it, of the retailers to have this power enforced, what the Clause does is to limit the freedom of the retailer to charge what price he wishes. That should not be ignored.
We should have been prepared to accept the Clause had the right hon. Gentleman included the three conditions: first, that collective resale price maintenance really had been effectively banned by the Bill. I think we have now quite definitely established that what we said on Second Reading about collective resale price maintenance is in fact true: that is to say, that what the previous Clause does is to ban its enforcement by a collective boycott. It does not ban its enforcement in any other way. If there is agreement to enforce resale price maintenance by methods other than collective boycott, then it is a registrable agreement which will be registered under the earlier part of the Bill, and then the matter may come up at some time before the Restrictive Practices Court which may or may not take the view that it is contrary to the public interest. That, whether right or wrong, is very far from banning
§ collective resale price maintenance outright.
§ Secondly, we think there should have been a firm safeguard to look after the special position of the Co-operative movement. I thought that the speech of the right hon. Gentleman, in answer to my hon. Friends who spoke about the Co-operative movement, was the least satisfactory speech he has made throughout the debates on the Bill. We were totally unconvinced by it. Very largely for that reason we do not feel prepared to accept the Clause in this unqualified form.
Thirdly, we feel equally strongly that if we are to grant this power to enforce, then there should have been a qualification, which we suggested in one or two Amendments a little earlier, that the Court—and we did not really want to have a Court—the body taking the decision, should have the power to say, when a consumer or user came forward with a grievance, "Well, in this case enforcement of individual price maintenance by law is not justified." The right hon. Gentleman refused that. By refusing that he has laid himself open to criticism which was made with much force by one of the members of the Liberal Party, in one of many excellent speeches on the Bill, to which we have already paid tribute.
If we are not careful we may get individual resale price maintenance used by the monopolies, on the one hand, and by the trade associations, on the other, to enforce what really is collective resale price maintenance through Clause 20. Since we have been refused all these safeguards, although I hope that the President will think again before the Report stage, we feel bound to vote against the Clause in its present form.
§ Original Question put:—
§ The Committee divided: Ayes 141. Noes 92.
1183| Division No. 178.] | AYES | [11.56 p.m. |
| Agnew, Cmdr. P. G. | Birch, Rt. Hon. Nigel | Corfield, Capt. F. V. |
| Aitken, W. T. | Bishop, F. P. | Crouch, R. F. |
| Alport, C. J. M. | Body, R. F. | Currie, G. B. H. |
| Armstrong, C. W. | Boyle, Sir Edward | Dance, J. C. G. |
| Ashton, H. | Braine, B. R. | D'Avigdor-Goldsmid, Sir Henry |
| Balniel, Lord | Braithwaite, Sir Albert (Harrow, W.) | Deedes, W. F. |
| Barber, Anthony | Bryan, P. | Digby, Simon Wingfield |
| Barlow, Sir John | Cary, Sir Robert | Drayson, G. B. |
| Barter, John | Channon, H. | du Cann, E. D. L. |
| Baxter, Sir Beverley | Cole, Norman | Eden, J. B. (Bournemouth, West) |
| Bell, Philip (Bolton, E.) | Cordeaux, Lt.-Col. J. K, | Farey-Jones, F. W. |
| Fell, A. | Kershaw, J. A. | Ropner, Col. Sir Leonard |
| Finlay, Graeme | Lambton, Viscount | Schofield, Lt.-Col. W. |
| Fisher, Nigel | Leather, E. H. C. | Sharpies, R. C. |
| Freeth, D. K. | Leavey, J. A. | Shepherd, William |
| Garner-Evans, E. H. | Legge-Bourke, Maj. E. A. H. | Simon, J. E. S. (Middlesbrough, W.) |
| George, J. C. (Pollok) | Legh, Hon. Peter (Petersfield) | Smithers, Peter (Winchester) |
| Glover, D. | Lindsay, Martin (Solihull) | Stevens, Geoffrey |
| Godber, J. B. | Linstead, Sir H. N. | Steward, Harold (Stockport, S.) |
| Gower, H. R. | Longden, Gilbert | Steward, Sir William (Woolwich, W.) |
| Graham, Sir Fergus | Lucas-Tooth, Sir Hugh | Stoddart-Scott, Col. M. |
| Grant-Ferris, Wg Cdr.R. (Nantwich) | Macdonald, Sir Peter | Studholme, H. G. |
| Green, A. | Mackeson, Brig. Sir Harry | Summers, G. S. (Aylesbury) |
| Gresham Cooke, R. | Mackie, J. H. (Galloway) | Thomas, P. J. M. (Conway) |
| Grosvenor, Lt.-Col. R. G. | McLaughlin, Mrs. P. | Thompson, Lt.-Cdr. R. (Croydon, S.) |
| Hall, John (Wycombe) | Maclay, Rt. Hon. John | Thorneyoroft Rt. Hon. P. |
| Harris, Frederic (Croydon, N.W.) | Manningham-Buller, Rt. Hn. Sir R. | Thornton-Kemsley, C. N. |
| Harris, Reader (Heston) | Markham, Major Sir Frank | Tiley, A. (Bradford, W.) |
| Harrison, A. B. C. (Maldon) | Marlowe, A. A, H. | Tilney, John (Wavertree) |
| Harvey, Air Cdre. A. V. (Macclesfd) | Maydon, Lt.-Comdr. S. L. C. | Touche, Sir Gordon |
| Heald, Rt. Hon. Sir Lionel | Medlicott, Sir Frank | Turner, H. F. L. |
| Heath, Rt. Hon. E. R. C. | Milligan, Rt. Hon. W. R. | Vickers, Miss J. H. |
| Hirst, Geoffrey | Morrison, John (Salisbury) | Vosper, D. F. |
| Hornsby-Smith, Miss M. P. | Nabarro, G. D. N. | Wakefield, Edward (Derbyshire, W.) |
| Howard, John (Test) | Neave, Airey | Walker-Smith, D. C. |
| Hudson, Sir Austin (Lewisham, N.) | Nicholls, Harmar | Wall, Major Patrick |
| Hughes, Hallett, Vice-Admiral J. | Nicolson, N. (B'n'm'th. E. & Chr'ch) | Ward, Dame Irene (Tynemouth) |
| Hughes-Young, M. H. C. | O'Neill, Hn. Phelim (Co. Antrim, N.) | Waterhouse, Capt. Rt. Hon. C. |
| Hylton-Foster, Sir H. B. H. | Orr-Ewing, Charles Ian (Hendon, N.) | Whitelaw, W. S. I. (Penrith &; Border) |
| Irvine, Bryant Godman (Rye) | Page, R. G. | Williams, Paul (Sunderland, S.) |
| Jenkins, Robert (Dulwioh) | Peyton, J. W. W. | Wills, G. (Bridgwater) |
| Jennings, J. C (Burton) | Pitt, Miss E. M. | Wilson, Geoffrey (Truro) |
| Johnson, Dr. Donald (Carlisle) | Pott, H. P. | Yates, William (The Wrekin) |
| Johnson, Eric (Blackley) | Price, Henry (Lewisham, W.) | |
| Joseph, Sir Keith | Profumo, J. D. | TELLERS FOR THE AYES: |
| Joynson-Hicks, Hon. Sir Lancelot | Raikes, Sir Victor | Mr. Oakshott and |
| Keegan, D. | Redmayne, M. | Colonel J. H. Harrison. |
| Kerby, Capt. H. B. | Remnant, Hon. P. | |
| Kerr, H. W. | Robinson, Sir Roland (Blackpool, S.) | |
| NOES | ||
| Ainsley, J. W. | Fernyhough, E. | Owen, W. J. |
| Allaun, Frank (Salford, E.) | Fletcher, Eric | Paget, R. T. |
| Allen, Arthur (Bosworth) | Fraser, Thomas (Hamilton) | Parker, J. |
| Awbery, S. S. | Gibson, C. w. | Pearson, A. |
| Baird, J. | Grey, C. F. | Peart, T. F. |
| Beswick, F. | Griffiths, William (Exchange) | Plummer, Sir Leslie |
| Blyton, W. R. | Grimond, J. | Popplewell, E. |
| Boardman, H. | Hall, Rt. Hn. Glenvil (Colne Valley) | Price, Philips (Gloucestershire, W.) |
| Bottomley, Rt. Hon. A. C. | Hannan, w. | Randall, H. E. |
| Bowden, H. w. (Leicester, S.W.) | Hayman, F. H. | Roberts, Goronwy (Caernarvon) |
| Bowen, E. R. (Cardigan) | Healey, Denis | Ross, William |
| Bowles, F. C. | Henderson, Rt. Hn. A. (Rwly Regis) | Short, E. W. |
| Boyd, T. C. | Holt, A. F. | Silverman, Julius (Aston) |
| Brockway, A. F. | Hughes, Emryt (S. Ayrshire) | Simmons, C. J. (Brierley Hill) |
| Broughton, Dr. A. D. D. | Hughes, Hector (Aberdeen, N.) | Skeffington, A. M. |
| Brown, Rt. Hon. George (Belper) | Irving, S. (Dartford) | Slater, J. (Sedgefield) |
| Burke, W. A. | Janner, B. | Thornton, E, |
| Castle, Mrs. B. A. | Jay, Rt. Hon. D. P. T. | Tomney, F. |
| Champion, A. J. | Jeger, George (Goole) | Ungoed-Thomas, Sir Lynn |
| Chetwynd, C. R. | Jenkins, Roy (Stechford) | Usborne, H. C. |
| Collick, P. H. (Birkenhead) | Jones, J. Idwal (Wrexham) | Wade, D. W. |
| Collins, V. J. (Shoreditch & Finsbury) | King, Dr. H. M. | Wheeldon, W. E. |
| Corbet, Mrs. Freda | Logan, D. G. | White, Mrs. Eirene (E. Flint) |
| Craddock, George (Bradford, S.) | MacColl, J. E. | Wilkins, W. A. |
| Cronin, J. D. | Mallalieu, E. L. (Brigg) | Williams, W. R. (Openshaw) |
| Dalton, Rt. Hon. H. | Mikardo, Ian | Winterbottom, Richard |
| Darling, George (Hillsborough) | Morris, Percy (Swansea, W.) | Woof. R. E. |
| Davies, Harold (Leek) | Moss, R. | Yates, V. (Ladywood) |
| Deer, G. | Moyle, A. | |
| Dodds, N. N. | Mulley, F. W. | TELLERS FOR THE NOES: |
| Ede, Rt. Hon. J. C. | Oram, A. E. | Mr. Holmes and Mr. J. T. Price |
| Edwards, Robert (Bilston) | Oswald, T. |
Question put and agreed to.