HC Deb 10 December 1959 vol 615 cc721-4
13. Mr. Thornton

asked the President of the Board of Trade when he hopes to be in a position to give to the House a list of those firms, and the amounts paid to each, who receive compensation for scrapping of machinery under the terms of the Cotton Industry Act, 1959, and have given their consent to publication of this information.

Mr. Erroll

This would necessitate an individual approach to about 500 firms, and, especially as they are fully entitled to withhold their consent, I do not think that it would justify the considerable labour involved.

Mr. Thornton

May I ask the Minister whether the whole list will be subject to the scrutiny of the Comptroller and Auditor-General and the Public Accounts Committee? Does not the Minister view with considerable concern the fact that large sums of public money are to be paid, and are being paid, to private persons and firms without any public check? Is not this a serious matter? I appreciate the limitations imposed on the Minister by the 1947 Act, but did not that Act envisage the collecting of information in respect of private business, rather than the concealing of payments of large sums from public sources? Will not the Minister take steps to amend the 1947 Act?

Mr. Erroll

It is not only the 1947 Act. We are also following the precedent of the Spinning Subsidy Act, 1948, which precluded the disclosure of information relating to amounts payable. As regards the rôle of the Comptroller and Auditor-General and the Public Accounts Committee, I would require notice of that question.

34. Mr. Thornton

asked the President of the Board of Trade if he will take steps to prevent a practice developing, as indicated in details sent to him by the hon. Member for Farnworth, of persons or firms who have qualified for compensation for scrapping machinery under the Cotton Industry Act, 1959, starting business again in the same type of manufacturing business with secondhand machinery purchased since the Cotton Industry Bill was introduced.

Mr. Erroll

I have asked the Cotton Board to look into this matter and will write to the hon. Member as soon as possible.

Mr. Thornton

Is the Minister aware that there is a danger of this becoming a racket which would undermine the whole purpose of the Government to make the industry smaller, more compact and efficient? Is it not a public scandal that firms should be paid for scrapping old and second-hand machinery and then use the money to reequip themselves with older secondhand machinery and make a profit out of the transaction at the expense of the public purse?

Mr. Erroll

Only if the facts are as the hon. Member has stated. We are looking into the case and I will let the hon. Member know. In any event, it is encouraging to know that there are firms with sufficient confidence in the industry to be ready to reinvest their compensation in it.

Mr. H. Hynd

Has the Minister studied the letter sent to the Department by J. and E. B. Riley Ltd. giving evidence that this kind of thing is happening? Is he aware that in my constituency three mills are closing down and it is understood that that kind of thing is taking place there, that people intend to use the compensation money to reopen in another place under another name?

Mr. Erroll

I will look at the letter which the hon. Gentleman has mentioned.

Mr. Jay

Is it legally possible under this Act for a firm, which has been paid money in return for closing down some machinery, to scrap the machinery and then to use the money to buy other machinery and to start up again?

Mr. Erroll

We want to look into the circumstances of the case which has been put forward before expressing an opinion.

Mr. Jay

Surely the Minister is familiar with the workings of his own Act? Can he tell us now whether this is legally possible under the Act?

Mr. Erroll

The right hon. Gentleman knows perfectly well that we do not give ad hoc legal opinions from this Box.

41. Mr. Thornton

asked the President of the Board of Trade if he will make a statement on the progress made to date in the operation of the reorganisation schemes under the Cotton Industry Act, 1959.

Mr. Erroll

Eight hundred and eighty-one applications for compensation under these schemes were received by the Cotton Board from firms in the spinning, doubling and weaving sections. My right hon. Friend understands from the Cotton Board that it has nearly completed its examination of some 150 applications and expects to make the first compensation payments very shortly.

Mr. Thornton

Is it not time we had a more comprehensive report from the Minister on the operation of this Act? According to the statement of the Prime Minister, £50 million or £60 million of public money is to be poured into Lancashire. In view of that, has not the House a right to have some more detailed information about how the scheme is progressing?

Mr. Erroll

My right hon. Friend is visiting Lancashire today and tomorrow. On his return I shall draw his attention to the point put by the hon. Member.