HC Deb 10 November 1959 vol 613 cc363-74

Motion made, and Question proposed, That this House do now adjourn.—[Mr. E. Wakefield.]

11.30 p.m.

Mr. Francis Noel-Baker (Swindon)

The subject I wish to raise briefly tonight arises from a Question which I asked the Minister of Transport last Wednesday and a brief discussion that followed as a result of a number of supplementary questions asked by my hon. Friends who take a close interest in the future of railway workshops. It follows a letter which I addressed to the Minister of Transport on 26th October drawing his attention to the apprehensions felt by my constituents in Swindon and by railway-men throughout the country about the Government's attitude to the future of British Railways workshops. It is without any discourtesy to the Joint Parliamentary Secretary that I express the hope that I shall in due course get a full and detailed reply to that letter from the Minister himself.

On Wednesday, the Minister gave, first, three quite negative answers when we tried to draw him on the question of the Government's attitude to this problem. He said: The construction and repair of locomotives and rolling stock is entirely a matter for the Commission … and I do not think that I should interfere. This view he repeated thrice, until he was pressed by my hon. Friend the Member for Newcastle-upon-Tyne, West (Mr. Popplewell), when he undertook to see that the Chairman of the Commission has a note of these present exchanges"— that is, what took place at Question Time on Wednesday— and when I next meet him I should like to discuss this question with him.'"—[OFFICIAL REPORT, 4th November, 1959; Vol. 612. c. 1028–9.] The first thing I want to ask the Joint Parliamentary Secretary is whether the Minister of Transport has yet seen Sir Brian Robertson and discussed this matter with him.

The Joint Parliamentary Secretary to the Ministry of Transport (Mr. John Hay) indicated dissent.

Mr. Noel-Baker

I gather the hon. Gentleman is indicating that the Minister has not done so. I hope that he will give us some indication when he proposes to do so and will let us know the result of that conversation in due course in this House. We are, of course, aware that the question is being discussed from time to time by the chairman of the Transport Commission and the leaders of the trade unions principally concerned, but we do not regard that as a substitute for keeping the House of Commons closely informed about a question with wide social and economic implications.

Secondly, can the Joint Parliamentary Secretary give us some indication of what degree of responsibility he and his right hon. Friend now accept for guiding and influencing the Commission in its attitude to questions of this kind or say whether he proposes to maintain the fiction—we believe it is a fiction—that the Commission can operate entirely independently of Government policy?

Many of us on this side of the House are beginning to be apprehensive about the relationship between many nationalised boards and the general public. That is one reason why we are pressing for a clearer acknowledgment of Ministerial responsibility for the working of these nationalised boards and why we very much hope that during the lifetime of this Parliament we shall get a situation where we can put Questions on the Order Paper and get Answers covering some of the detailed work of these great nationalised boards.

My right hon. Friend the Member for Derby, South (Mr. P. Noel-Baker), when answering Questions on transport during the war, was in the position of having to give detailed information about the running of the railway system. He has assured the House, as he has also assured me privately, that far from being an obstacle to the functioning of the Ministry or to the working of the railways, the fact that Questions could be asked here was a great help. Many people outside the House of Commons are becoming worried about the fact that some of the nationalised industries appear now to be, not more accountable to the general public, but less accountable than some private firms. This is a situation which hon. Members on this side of the House deplore.

I indicated that the question of the future of railway workshops was of special concern to my constituents in Swindon. We have some of the finest railway workshops in the world. But I am not thinking of this problem only in terms of a narrow constituency issue. All over the country there are railway workshops in which, at present, 150,000 industrial workers are employed, besides thousands of clerical and supervisory staffs, and 11,000 of those industrial workers are threatened with losing their jobs by 1961, as the modernisation programme goes through.

Therefore, it is natural that they "should be very apprehensive about the future. My constituents in Swindon who work in these railway workshops and railwaymen throughout the country recognise that one of the inevitable results of the modernisation programme will be a contraction of the railway system as a whole, including the railway workshops. They accept that in a very generous and realistic spirit. But they are very worried about the attitude of the Government and the Transport Commission to the publicly-owned railway workshops. They fear—and when one considers what was said during the election campaign and what has been said very often from the Ministerial Bench in the previous Parliament about the Conservative Party's attitude to public enterprise their fear is not unreasonable—that the Government may use their influence with the Commission against the interests of the publicly-owned workshops, because of their doctrinaire bias against nationalisation.

At all events, they are worried because they believe that even under present conditions many thousands of pounds worth of work, which they could and should have been doing in the British Railway workshops, have gone to private firms. They feel that their workshops could be made capable of doing very much more work if it were the policy of the Commission to spend a little more money on re-equipping and re-tooling them, and laying them out for doing new types of work. As the Parliamentary Secretary is aware, so far the Commission has turned its face resolutely against any change in the type of work which the workshops are allowed to do.

In the last Parliament, Ministers were constantly talking about the need for the Commission to hold a fair balance. Speaking in the House on 29th July, the former Parliamentary Secretary talked about the necessity to hold a fair balance between the interests of the railway workshops and the interests of private firms. At the same time, we heard Ministers constantly urging that the railway workshops should compete with private firms. Many of my constituents in these workshops feel that that would be quite unrealistic. They point to the fact that at the present moment Government policy makes it quite impossible for railway workshops to compete on a level with private firms. They may not raise capital, they may not retool for new jobs, they may not do any outside work. They may not, apparently, even do work for one of the railway systems belonging to the Commission itself, namely, the London transport system. So long as the present obstacles and restrictions remain, many railwaymen will be convinced that talk of competition between the British Railways workshops and private firms is humbug. Furthermore, they do not feel that there is any onus on the Commission to hold a balance between the work done by the nationalised workshops and that done by private firms.

I want to make a brief mention of a series of contracts which has given rise to special apprehension. I mentioned it in the House last Wednesday. In January of this year orders were placed with the North British Locomotive Company for 36 diesel-hydraulic shunting locomotives. Previous orders had been placed for large numbers of Type 4 main line diesel-hydraulic locomotives and for Type 2 diesel-electric locomotives. What particularly angered my constituents at the time about this was that they produced the prototype of the Type 4 locomotive and they are building a number at the present time, and, so they tell me, they are having to teach the North British engineers how to make this locomotive.

Apart from that, at a time when they are being told that there is no money available to re-equip and re-tool British Railway workshops for new jobs, they learn that during this year the North British Locomotive Company borrowed £1¾ million of the taxpayers' money from the Treasury on what the Economist calls surprisingly favourable terms and borrowed a further £500,000 from another private firm and arranged to borrow as an overdraft from its bankers a further £1½ million, making a total of £3¾ million since the beginning of the year. According to the latest statement by the new vice-chairman of the firm, Lord Reith, this company appears to be in the process of going bankrupt. The Economist says: There will have to be a very considerable improvement indeed before these loans can be considered safe. In these circumstances, is it surprising that railway workshop men are rather cynical when they are told that there is no money available for re-equipping their own shops?

I am well aware that there are hon. Friends of mine who are preoccupied about the future of constituents of theirs who work for private firms making loco motives and rolling stock. My hon. Friend the Member for Gloucester (Mr. Diamond) takes a natural and very close interest in the Gloucester Carriage and Wagon Works. My right hon. Friend the Member for Wakefield (Mr. Creech Jones) has drawn my attention to the fact that in his constituency the firm of Charles Roberts and Company Limited has for many years and with great skill made wagons for the British railway system. But I am bound to put the interests of my constituents even before those of my hon. Friend the Member for Gloucester, who is shaking his head at me. I am bound to point out to him that the firm in his constituency is in a position to go in for other types of business whereas the British Railway workshops are precluded from doing that, and it is natural that the B.T.C. should look after parts of its own organisation first. Since January of this year until Saturday—

Mr. John Diamond (Gloucester)

Would not my hon. Friend agree that it is the responsibility of the Government to see that all these workshops are fully engaged and that the people working in them have adequate work to do, and that it is important that the boards of management should know what the Government are going to do and what effect Government policy will have?

Mr. Noel-Baker

I agree with my hon. Friend to the extent that it is important that everyone connected with the British railway industry should know exactly what Government policy is, and that is one reason why I am raising this matter. I hope the Joint Parliamentary Secretary, and later the Minister will do a lot to reassure railwaymen and others who are apprehensive at the present time.

But it is not realistic for the B.T.C. to go on placing orders for locomotives or wagons which will not be required when the modernisation programme goes through. There is bound to be a reduction in the number of wagons on the road, and I can only recommend that the constituents of my hon. Friends see whether they can start to take over other types of work as well.

I was saying that since last January until last Saturday orders for 307 new locomotives have been placed with British Railways and 456 with private firms. There have also been enormous orders to private firms for diesel units and other rolling stock and for a wide range of components which many railway shop-men and their unions believe could have been made in British Railway workshops. On Saturday there was an announcement that British Railways planned to build another 390 diesel train vehicles. I am glad to say that 51 of these went to Swindon. I would hesitate to complain about the 282 that went to the constituency of my right hon. Friend the Member for Derby, South, and if it is not very much out of order I should like on this, the first occasion when I find myself in the House of Commons with him, to add my humble congratulations to those which have been accorded to him from many other quarters. I notice also that 57 are going to Eastleigh as well as others elsewhere. We on this side of the House very much welcome this programme and I hope the Parliamentary Secretary will tell us more about it.

In order to give him adequate time to reply under the circumstances, I end by saying that the new Minister of Transport and the new Parliamentary Secretary can do a very great deal for the industry as a whole if they will let it know exactly what Government intentions are and where they stand. Will they also have a close look at the placing of contracts in the recent past and plans for the future and have a good look at the resources of British Railways workshops and the possibility of re-equipping them to do the new jobs which inevitably must replace the old jobs—I am thinking of boiler-makers and people of that kind who inevitably will be redundant—and reassure them that the Government will make the maximum possible use of these workshops and not, as some railwaymen fear, obstruct them, dismantle them, and finally sell them up?

11.46 p.m.

Mr. Harold Garden (Birmingham, Selly Oak)

In the very few minutes available to me, may I say that there are two points of view on this matter? I want to speak for a moment for the Conservative Members of Parliament who are concerned in this matter so far as wagon repairs for the railway industry are affected because the British Transport Commission has announced that it must now give overriding consideration to its own employees and workshops to the detriment of private industry which, for about 100 years, has been responsible for wagon repairs and wagon building.

On behalf of the workers concerned in this important industry in Birmingham, and indeed in Gloucester, I say it is just as important that these chaps should retain their jobs as it is for the railway workers in Swindon to have their jobs. I want my hon. Friend to consider that the public in the recent election said they would not like to see industry removed from private enterprise into nationalised industries. If I had the time. I am sure I could convince the House that it is just as important for private industry to be retained in the repairing and making of wagons as for railway workshops. I am sure the House and the country as a whole would not like to see private industry in the wagon industry shut out any more than they would like to see the nationalised industry completely shut out.

I hope, therefore, that my hon. Friend will take into account that there are certainly two points of view on this matter.

11.48 p.m.

The Parliamentary Secretary to the Ministry of Transport (Mr. John Hay)

The subject raised by the hon. Member for Swindon (Mr. F. Noel-Baker) is one which I know has caused some anxieties in towns where railway workshops have for years provided a very valuable and strong local source of employment, and even a matter of quite justifiable local pride.

As he said, this is not the first time that this House has been concerned with the subject. There was debate only a few months ago, and the hon. Member has been pertinacious in raising the matter. It has also been the subject of numerous Questions, as he said, as recently as last Wednesday week we had a further series of them. The hon. Member said he had written to my right hon. Friend about this matter. I can assure him that he will receive a full reply, which perhaps will dot the i's and cross the t's of what I have to say tonight, which naturally is somewhat compressed owing to the difficulties we all have in time. I begin by referring to the background of this matter. I do not think one can look at this in perspective unless one can appreciate the background.

We have to remember that British Railways inherited on nationalisation a mass of repairing and manufacturing capacity from the four old main line companies, and that this capacity was far more than they needed. It will be within the recollection of the right hon. Member for Derby, South (Mr. P. Noel-Baker), who was, I believe, a member of the Government in those days, that it was one of the points made in favour of nationalisation—and I am not arguing the political side now—that one could integrate that sort of capacity and make a more efficient industry. That was the situation that faced the Transport Commission when it was set up in 1947.

The second factor is that the industry is now engaged in a massive programme of modernisation and is going to spend some £1,500 million over the next 15 years, and have, I think, already spent quite a considerable sum of Government money. When the hon. Member for Swindon says he would like a clear statement on where the Government stand in relation to the industry, I would ask him to bear in mind that we have supplied a substantial sum of money already to the modernisation programme as well as meeting quite substantial deficits which the Commission has had in recent years.

The principal features of the plan are, first of all, the programme of introducing diesel locomotives on most of the main lines, followed by electrification. This means that the old steam locomotive is going to disappear. I was told today that the last steam locomotive being built for British Railways is at present being built and will soon be going on to the tracks.

Mr. F. Noel-Baker

In Swindon.

Mr. Hay

Yes. The second feature is that the whole railway system will have to contract. This is a process causing some difficulty. My predecessor had to answer a number of Adjournment debates on the closure of branch lines. But the country as a whole accepts, I think, that we have to have a smaller type of railway system than in the past.

The third factor is that inevitably there has to be a reduction in the wagon fleet. This is partly a consequence of the decline in freight traffic and also is intended to ensure more efficient utilisation. The Commission is making steel wagons which will be larger and cheaper to maintain in the future than the present wooden wagons. It really amounts to a complete overhaul and pruning of the system of British Railways, connected with the thorough-going modernisation of equipment.

It is an inseparable part of the picture I have briefly tried to draw that the railways should be appreciated to be a commercial concern engaged in a competitive transport industry. It is true that they have a monopoly of railway, but they have not a monopoly of transport. They have to meet competition from the road and from the air.

It is frequently said in connection with the particular problem raised by the hon. Member for Swindon that the Minister of Transport should intervene to protect and preserve the rights of those who work in the railway workshops. It is usually suggested, as it was last Wednesday, that the Minister should give a direction to the Commission to turn more of their building and repair work to their own workshops and less to private enterprise. Sometimes, it is put the other way round. My hon. Friend the Member for Birmingham, Selly Oak (Mr. Gurden) rather hinted at that just now.

Mr. F. Noel-Baker

The reason for the way my Question was framed was to get it past the Table. It was not the intention behind it.

Mr. Hay

I was so recently on the back benches myself that I can remember that that is the drill one must adopt in these cases. But it is often put forward as a serious point, and I think I should tell the House that the power of giving direction is a pretty strong weapon, which was conferred on the Minister by the various nationalisation Statutes. It is a kind of sledgehammer kept in some dark cupboard in Berkeley Square which can be used, if the occasion arises, on the Commission. Fortunately, only on one occasion since 1947 has it been necessary for this sledgehammer to be brought out. It was used in April, 1952, according to my information, to instruct the Commission not to proceed with a fares increase; and it was used a second time in August of that year to tell the Commission to disregard the previous direction.

The point is that a direction of this kind, which we have been asked to use in connection with the railway workshops, is a very strong weapon. My right hon. Friend and his predecessors have frequently made it plain that a direction will not be used to the British Transport Commission requiring them to put any proportion of their building or repair work to any particular workshop or type of workshop, nor will the Minister require that the Commission shall use its own facilities in preference to those of any private firm or company. In our view this is entirely a matter for the Commission, for it is a commercial undertaking engaged in a competitive enterprise, and we do not propose to interfere with its commercial judgment in the matter.

Having said that briefly, may I turn to a rather more hopeful part of the picture which I hope will interest the hon. Member.

Mr. Philip Noel-Baker (Derby, South)

The hon. Member has made various observations about what happened when I was in the Government. I give notice that I shall seek to raise this matter again on the Adjournment to clear them up.

Mr. Hay

I am grateful to the right hon. Gentleman. Perhaps he will tell me what I have said which caused his interjection. I thought that I had said nothing exceptionable. If I have, I apologise to him. That is how I understood the position.

Let me reassure the hon. Member for Swindon, if I can. The Commission has made the position clear on a number of occasions, the most recent being 14th May of this year, when it issued a notice which made it plain that it did not intend any wholesale closing of the railway workshops. The Commission made it clear that these workshops will continue for the manufacture of the equipment for which they were suitable and will also continue for the repair of all equipment. It was also made plain that the reduction in workshop capacity which must go on, because there is too much of it, would be by a carefully phased programme, to which the Commission is adhering.

Further—and I believe that this is a matter of great interest to the hon. Member's constituents—the Commission made it clear that throughout the whole of this programme it would keep in the closest touch with the trade unions concerned. The trade unions have been consulted throughout. My advice is that in May of this year an agreement was reached between the Commission and the unions which provided that if, as a consequence of this policy, men had to be transferred to other work at a lower rate of pay than that which they were previously receiving, then for three years after that time they would continue to receive their standard time-work rate of pay. Further, if anyone had to be discharged because he was genuinely redundant and could not be absorbed elsewhere in the Commission's activities, then a lump sum payment of compensation would be made if the man had been employed for three years or more.

This policy of contact with the unions over redundancy, I am advised, goes right down to the regional level, and the evidence which we have is that it is working extremely well. It looks to me, as some one coming fresh to the problem, that the Commission in the whole of this matter is behaving like a good employer, and I am sure that that is something which we all want to see.

I want to add a further comment about redundancy. We must not consider this matter entirely in isolation. It is not a case that there are no jobs awaiting anybody formerly employed in the railway workshops who becomes unemployed because of this policy. There are plenty of jobs available in this country for skilled engineers. I obtained the latest figures from the Ministry of Labour today, and the situation is that in engineering and similar trades in October of this year there were no fewer than 28,000 unfilled vacancies. I hope that that will give a little reassurance to some people who may be wondering whether they will lose their jobs in the railways and whether they will be able to find other jobs quickly.

In the moment that remains I want to say a word about Swindon. I have obtained some information about the hon. Member's constituency today. The position is that at Swindon they have on hand orders for 125 diesel locomotives, over half of them being of the main line type, and 84 diesel multiple-unit vehicles. The words of the British Transport Commission's letter are, The workshops are very busy, and the existing orders will ensure a high level of activity for some considerable time. I hope that that will be some comfort and reassurance to the hon. Member for Swindon. I do not think that there is any need for apprehension, still less for uncertainty, about the future. I am sure that there is plenty of work ahead for a rather more healthy and more economic system of railway workshops, and it will be the Government's policy to support and help the British Transport Commission in any way we can to achieve that end.

The Question having been proposed after Ten o'clock and the debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at Twelve o'clock.