HC Deb 12 November 1958 vol 595 cc379-81
25. Mr. Ernest Davies

asked the Minister of Transport and Civil Aviation what proposals he has to amend the Transport (Railway Finances) Act by raising the limit of £250 million on borrowing to meet deficits incurred by the British Transport Commission to enable deficits to be financed until 1962 as was the purpose of the Act.

Mr. Watkinson

I shall be putting my proposals before the House in due course.

Mr. Davies

How soon will that be? Will the House have an opportunity to debate this? Is it the Minister's intention to increase the amount of the debt which the Commission will draw for deficit financing? Is it a fact that this fund will be exhausted next year, although it was voted for seven years? Do not the arguments for deficit financing on the basis of loans from this House stand today equally well as they stood previously, especially as the Government are to blame for the Commission's difficulties today?

Mr. Watkinson

I am not sure whether the hon. Member has noticed the sentence in my letter to the Commission which said that its future position will be considered when the general limits of its borrowing are considered, and this is bound to arise shortly in any case.

32. Mr. Donnelly

asked the Minister of Transport and Civil Aviation whether he will make a further statement on the Government's proposals to meet the prospective deficit of £85 million on British Railways.

Mr. Watkinson

As I stated in answer to Questions last week, the Government have decided to advance the necessary funds to meet this year's deficit under the Transport (Railway Finances) Act, 1957.

Mr. Donnelly

Can the right hon. Gentleman say what proportion of the loss is due to the recession in the economy, which might be taken up in an economy expanding at the normal rate, and what proportion of the loss is due to his policy of the denationalisation of road transport?

Mr. Watkinson

The whole of the Commission's financial position is clearly set out in the Chairman's letter to me, which I have said I would publish as a White Paper and which has already been circulated in HANSARD.

Lieut.-Colonel Bromley-Davenport

Does my right hon. Friend agree that this huge deficit, with a prospect of larger deficits yet to come, combined with worse service to the public, is yet another typical example of the failure of nationalisation?

Mr. Watkinson

Looking back, it is a pity that so much time was spent on nationalisation and not enough on modernisation.

Mr. Ernest Davies

Will the Minister cast his mind back to pre-war days and consider what modernisation was done on certain of the railways, notably the L.N.E.R., before the war? In his letter to the Minister, did not the Chairman of the Commission state that the Commission's present position was due to the decline in traffic resulting from the decline in coal and steel production, mainly steel production? Is not the Government's economic policy therefore to blame for the increase in the deficit?

Mr. Watkinson

I repeat that if modernisation had not been started ten years too late, the Commission would not be in difficulty now. Perhaps it has escaped the hon. Member's notice that coal, too, is nationalised.

Mr. Ernest Davies


Mr. Speaker

Order. This Question will not sustain an argument on nationalisation.

Mr. H. Morrison

Does not the right hon. Gentleman agree that if the old private companies had continued, not only would modernisation not have taken place, but the companies would have been bankrupt by now?

Mr. Watkinson

I think we will get on faster if I do not answer hypothetical questions.

Mr. Lipton

I am willing to wait for the Answers to my Questions which appear later on the Paper.