HC Deb 16 June 1959 vol 607 cc226-8
21. Mr. Osborne

asked the President of the Board of Trade if he will move to appoint a Select Committee to investigate the economic consequences of the growing movement towards greater industrial and commercial amalgamations, to advise how far these are restricting consumers' freedom, to inquire what effect they are having on prices and distribution, and to make recommendations.

Mr. J. Rodgers

No, Sir. I am not satisfied that the growing movement towards industrial and commercial amalgamations is against the interests of consumers or the economy as a whole. The Board of Trade can, however, ask the Monopolies Commission to report on any industry where at least one-third of the supply of goods is in the hands of one firm.

Mr. Osborne

Does my hon. Friend think that the capitalist system can work efficiently—or even be justified—unless there is adequate competition? Does he think that it is good for the nation that there should be one jam manufacturer, one brewer and one distributor of furniture? Is it not time that some competition was restored to our economy?

Mr. Rodgers

I am a great believer in competition, but I think that the picture drawn by my hon. Friend is a travesty of the facts. There is no such thing as one brewer or one furniture firm in the country. The freedom to buy, to sell and to combine assets is essential to the healthy development of a competitive society in which the most efficient should prosper.

Mr. Jay

Is not the Parliamentary Secretary paying quite insufficient attention to the very important question asked of him by his hon. Friend the Member for Louth (Mr. Osborne)? Since his hon. Friend is clearly right in saying that competition is diminishing over a whole number of industries—as anyone knows who reads the financial Press—is there not fairly strong ground for more public supervision in the interests of the consumer?

Mr. Rodgers

I do not accept a word of what the right hon. Gentleman says. Because the number of firms diminishes it does not mean that the competition is any less intense.

Mr. Nabarro

Would my hon. Friend not agree that many of these amalgamations have taken place as a direct result of an affinity of interest, as for example between a jam manufacturer referred to by my hon. Friend the Member for Louth (Mr. Osborne) and a mineral water manufacturer? Why should they not amalgamate and reduce prices to the consumer as a result of the amalgamation?

Mr. Rodgers

To my mind, anything which provides an incentive to efficiency is in the best interests of consumers, workers and the country as a whole.

Sir L. Ungoed-Thomas

Does not the hon. Gentleman realise that these amalgamations to which reference has been made take effect in order to avoid the consequences of the Restrictive Trade Practices Act? The policy of that Act is to produce more competition, and these amalgamations are intended to avoid it. How does the hon. Gentleman propose to deal with the amalgamations which are defeating the purpose of the Act?

Mr. Rodgers

I do not accept the inferences of the hon. and learned Gentleman's strictures, that these amalgamations take place in order to avoid the provisions of the Restrictive Trade Practices Act.

Sir L. Ungoed-Thomas

It is notorious. Everybody knows it.

Mr. Rodgers

They take place because they add to greater efficiency, leading to lower operating costs and, we hope, lower prices.

Mr. Jay

Is not the hon. Member for Kidderminster (Mr. Nabarro) for once right in thinking that this affinity of interest between producers is steadily reducing the range of choice which consumers have?

Mr. Rodgers

They still have a wide choice in every field.

Mr. Shinwell

Is the Parliamentary Secretary aware that many of us on these benches favour and encourage amalgamations for the simple reason that it would be easier for the State to take these industries over?

Mr. Rodgers

I am aware of the views of the right hon. Gentleman and his hon. Friends, but they do not commend themselves to this side of the House.