§ Motion made, and Question proposed, That the Clause stand part of the Bill.
§ Mr. Benn
We now move on to a new Minister, and, refreshed by his presence, I hope that the Committee will permit me to raise the question of the Vehicle Excise Duty under Clause 10.
We have had many references to the Chancellor's speech when introducing his Budget, and indeed this change in the Excise Duty for hackney carriages was considered so important that the right hon. Gentleman put it first among all the many reforms which he presented to the Committee on 4th April.
As I understand it, this is a very minor change. I do not know why the right hon. Gentleman put it first. It provides that a hackney carriage may be a vehicle let for more than three months whereas hitherto it was only for a three-month period or less. A hackney carriage, of course, according to the definition of the 1949 Act, includes not only what we think of as a hackney carriage—a taxicab— but also larger vehicles, and I understand 1423 that this provision may apply to the private hire of buses as well as to hackney carriages proper.
One exception is made in this case. In the Clause it is provided that this shall not affect vehicles that are being let under a hire-purchase agreement. That is to say, we are speaking now purely and simply about vehicles which are let and remain within the ownership of the man who lets them and are not slowly being transferred to other ownership.
I must add one other thing. As I understand it, there is to be no change in the duty payable under the Clause, and, therefore, in practice there will not be more than a minor relief for hackney carriage owners. But at the same time this raises a very important piece of transport policy where the Chancellor has great opportunity to influence the development of transport, and I want to draw the attention of the Committee to it very briefly.
We are discussing the relationship between private cars and hackney carriages and the treatment which each are to receive from the Treasury, and I welcome the presence of the Joint Parliamentary Secretary to the Ministry of Transport to explain this. I wish that the Chancellor had taken the opportunity presented to him by this modification of the law as it relates to hackney carriages to go a great deal further. I propose in a few moments to give my reasons for that.
It is part of the Opposition's argument that the Government's attitude to transport matters is haphazard in the treatment that they accord to different types, methods and means of transportation. I will give an example to illustrate what I mean. The Ministry of Aviation subsidises airfields in this country to the extent of £10 million a year—it makes that loss—and as a result enables British European Airways to undercut British Railways in the flights to Scotland, which increases the difficulty for British Railways, and this loss falls as a deficit on the Treasury. This seems to us to be one example of bad co-ordination of policy.
Another example is that there is no co-ordination whatsoever between road building, which falls to the Treasury to finance, and railway modernisation. 1424 Those two things, if conducted without relation to one another, may lead to overlapping.
§ The Deputy-Chairman (Major Sir William Anstruther-Gray)
I am sorry to interrupt the hon. Gentleman, but I find it difficult to relate all this to the Question, "That the Clause stand part of the Bill."
§ Mr. Benn
I am glad that you are waiting for my next point, Sir William, with which I am going on to deal, and that is the relationship between private and public vehicles in cities. As I understand it, this is exactly the subject of the Clause. It is part of my case that the Treasury ought to adopt a far more liberal view towards the Excise duty to be levied upon hackney carriages as compared with that levied upon private cars. It is part of my argument—if it is out of order, then everything that I have to say is out of order—that urban congestion can be solved only by the public resorting more and more to the hire of vehicles and less and less to the ownership of vehicles. That is the argument that I want to address to the Committee.
Parliament is concerned with the problem of urban congestion in many of its aspects. Efforts are being made to give the Minister power to deal with it. We are all faced with the problem. Everybody recognises that it is one of the great problems of our time. It is part of my argument that the real answer to the problem of urban congestion lies in cheap public transport and that the hire of vehicles for moving about in a city will in the long run offer the only solution to the problem.
I have been trying to think how one can measure urban congestion in order to get some guide as to the fiscal policy that ought to be pursued by the Chancellor in dealing with these matters. There are, obviously, four elements in urban congestion. They are: the amount of road occupied by vehicles, the length of time which that portion of the road is occupied, the number of passengers carried by the vehicles that occupy the road, and the distance travelled by the passengers in the vehicles that occupy the road.
I have tried as best I can to confine these different elements within a single unit of measurement, and I want to offer 1425 to the Committee a new statistical unit which I believe measures the degree of congestion by different types of vehicles. I hate to impose a formula at this hour of the night upon a Committee which is tired and anxious to go home, but when the Committee sees the use to which this statistic can be put I think it will realise that it has some value.
The unit of measurement that I suggest is the proper one for urban congestion is the square foot hours of road space occupied per passenger mile travelled. That brings into operation all the elements I have discussed earlier. Since I invented this statistic I shall name it the "unit of block", which seems an appropriate title. I am dealing with a very difficult part of my brief, which I wrote myself—
§ The Joint Parliamentary Secretary to the Ministry of Transport (Mr. John Hay)
Would the hon. Gentleman be kind enough to repeat it? We want to get hold of it.
§ Mr. Benn
I am serious about this. I say that the only way one can measure urban congestion is by taking the square foot hour of road space occupied per passenger mile travelled. That brings in the amount of road occupied, the time for which it is occupied, the number of passengers carried and the distances for which passengers are carried.
I give two extreme examples. The first is that of a man who lives in Westminster and has his office in Mayfair, with a large limousine car 6 feet by 12 feet, and who travels into Mayfair with a chauffeur in the morning. The car is left in the streets until he returns in the evening. The units of block in this case are measured as follows: the car is 6 feet by 12 feet, which gives 72 square feet. It is on the road for 9 hours, which, if one multiplies it by 72, is 648 square feet hours of road occupied, and it carries one man 2 miles a day twice— that is, 4 passenger miles. Divide 648 by 4, and the unit of block is 162.
Next, is a clerk in that man's office, who also lives in Westminster but travels to work by bus. The measurements of the bus are 8 feet by 24 feet. It is on the road for 12 hours. That means 2,304 square feet hours of road space occupied. But, of course, the bus carries, in the course of the day, 40 passengers 120 miles which is 4,800 passenger miles. Divide 2,304 by 4,800 and it will be seen 1426 that it amounts to only 0.5 of my units of block. I hope that the Committee will not think that this is a flippant thing to put over at this time of day.
The difference between the man who travels in the limousine to and from his office, and the man who travels by bus is the difference between 162 units and .5 of a unit. The other extreme, the man who goes by underground or walks of course occupies no space on the roads.
The most interesting case is that of the man who goes by taxi, because the taxi, I believe, will turn out to be the answer to the problem of urban congestion. Applying the same formula to that taxi, whose size is 4 feet by 8 feet, which is 32 square feet, and assuming that it is on the road for twelve hours, it occupies 384 square feet hours, carrying two men 240 miles a day or 480 passenger miles. Divide 384 by 480 and the unit of block in this case is only 0.75.
Let us compare those four cases that I have given. The man who walks or goes by underground occupies no road space; the man who goes by bus occupies half—0.5—of a block; the man who goes by taxi occupies 0.75, or three-quarters, of a block; and the man who goes by limousine occupies 162 blocks on the London roads.
These figures demonstrate what people recognise to be the fact—though I have never seen it measured before—that the problem of urban congestion proves that taxis and buses are high productivity, low-blockage urban vehicles, whereas private cars are low productivity and high-blockage vehicles. This applies as much whether we have off-street car-parking or not. They still occupy a large part of the urban road area.
The whole point of my argument is that if it is logical for the Ministry of Transport to make private motoring expensive in the cities—which it is going to be with parking meters and off-street car parks, which, if experience in America provides an example, will soon cost £1 a day in the middle of the city—then it is better to back that up by helping to make public transport cheaper. That is why I should like the Chancellor of the Exchequer to go a great deal further in lifting the Excise duty on hackney carriages. I believe that cheap, plentiful, flexible public transport in a city is the real answer to this problem of congestion.
1427 It would be out of order to discuss underground development and I will not attempt it, but it will be in order to discuss buses or taxis. When I sit down and calculate the amount of money which I spend as a motorist in London and I consider the possibility of selling my car and travelling by taxi, I find that there is not all that difference already between the cost of running a private car in a city, even with free parking, as compared with a far greater use of taxis.
I think that we are moving towards the day when the taxi in the big city will turn out to be the answer to our problem. When we say, as we do, about the big cities that public transport is the answer, we must not be hidebound and rigid and suppose that public transport necessarily means only buses. People nowadays have a higher standard and they want to be moved from where they are to where they want to go without necessarily having to walk to the Underground station and back. A more plentiful provision of cheap taxis might offer a greater solution to the Parliamentary Secretary's problem of urban congestion than he has yet fully recognised.
I was interested to see that Mr. Khrushchev made this point in the United States and it was his remark which first set me off on my statistical analysis of the problem. Not only is the taxi the answer, but it may well be that a far greater use of the hire car is an answer. Indeed, there is already evidence that the hire-car business— "drive-yourself"—is booming in this country and we are already beginning to have the development of the system started in the United States by which one picks up a car, drives it to where one wants to go, leaves it there and returns by train.
That helps to get high productivity transport into operation, because what is wrong in this country, which is a small country with few roads and many cars, is that most of the cars at any given time are not in action. Just as we want to get the maximum yield from our roads, so we want to get the maximum yield from our vehicles and the only way in which we can get the maximum yield from our vehicles is by having better 1428 provision, both fiscal and otherwise, for hire-car provision, both "drive-yourself" and the taxi service.
In London, the answer may well be for London Transport to go into the taxi business, perhaps with much smaller vehicles and perhaps in a way different from that which we now have and in some way to cater for the need for individual transport, which exists in the city, without any problem of parking, because the taxi is always on the move. I offer these comments to the Parliamentary Secretary sincerely—it may be that his brief does not cover an answer to them —because the Chancellor of the Exchequer can help a great deal in this regard.
I altogether exclude hire purchase from my argument. I am not interested, for the purpose of this argument, in the man who is trying to acquire a vehicle for his own purposes, because he does not help to solve the problem and is still a man using a vehicle with a low productivity, but the more we can encourage people to hire vehicles, the better and the sooner we will be able to solve the problem of congestion.
The Clause appears to go a tiny fraction of the way towards a solution of the problem and makes it a little easier for firms to hire their own buses rather than use public transport. It makes it a little easier for the long-term hirer whereas the provision was previously limited to three months.
This is the beginning of a campaign which we on this side of the Committee will be waging on future Finance Bills for far greater Government help and consideration for the type of transport which is paid for only when it is used, as against the private motorist who cannot hope, with all the new roads in the world, in future to be able to use the country's big cities to an unlimited extent. If the Joint Parliamentary Secretary, in the goodness of his heart and from the breadth of his knowledge and experience, feels able to address some comments to this argument, I shall very much appreciate it.
§ 11.0 p.m.
§ The Joint Parliamentary Secretary to the Ministry of Transport (Mr. John Hay)
The Committee will have admired the ingenuity with which the hon. Member for Bristol, South-East (Mr. Benn) 1429 has been able, on the somewhat flimsy basis of the Clause, to erect a substantial and interesting argument, to which I shall return later.
First, I want to say a word about the Clause and what it does. Its purpose is to make a change in the vehicle Excise duties payable by certain types of bus. The Clause deletes from the definition of a hackney carriage, contained in Section 27 (1) of the Vehicles (Excise) Act, 1949, a proviso which enables buses and coaches to be licensed at the rate of duty applicable to ordinary private vehicles if they are 1st for a period of three months or more. A vehicle which is let for three months or more is not classified as a hackney carriage, and it becomes liable for duty under Section 6 and the Fifth Schedule of the Act, which apply to all vehicles, including private cars, not covered by any other Section. The rate of duty payable becomes £12 10s. a year instead of the hackney carriage rate, which varies from £12 a year for a vehicle which has between four and 20 seats and £12 plus 10s. for each seat in excess of 20 for vehicles with more than 20 seats.
This is a provision of considerable antiquity. I understand its origin is in the Customs and Inland Revenue Act, 1888. It has become largely unworkable, because we have found that contracts of this kind can be and frequently are varied after the vehicle excise licence has been issued. Similarly, contracts do not usually stipulate for the use of a particular vehicle, but rather that the hirer will provide vehicles of a particular kind or capacity, and hirers sometimes substitute one vehicle for another. Contracts may also be expressed in terms which do not establish finally whether vehicles are or are not hired for three months or more. The extent of the problem is indicated by the fact that in one case last year a hirer was able to claim a refund of duty amounting to no less than £6,000. In any case, I do not think that the Committee would deny that there is no good reason in principle why a bus let for hire for a period of three months or more should pay a different rate of duty than one let for a shorter period, or not let at all.
The practical effect of the change is that firms providing transport for public works contractors and others on the basis 1430 of long-term contracts which have in the past paid duty at the private car rate will in future pay duty at the rate appropriate to the seating capacity of the vehicle. The smaller buses, with 20 seats or less, will pay duty at a slightly lower rate than at present. For larger buses there is a graduated addition to the flat rate of 10s. for every seat over 20. A 20-seater bus now paying £12 10s. will, in future, pay £12, while a 30-seater paying £12 10s. will in future pay £17. The change will have very little effect on revenue.
That is the purpose behind the Clause. I now come to the remarks of the hon. Member for Bristol, South-East. The important thing to understand is that vehicle excise licences have never been used in the past for the kind of vehicle control over traffic that he was envisaging. The duties that we are concerned with in the Clause and the duties mentioned in the Vehicles (Excise) Act are intended only to raise revenue. The only exception, if it be an exception, to that general rule has in the past been in the case of hackney carriages, because some years ago it was necessary to stimulate the motor industry in this country, with the useful results we all know. The hackney carriage rate has for some time been lower than the private car rate. That is one of the reasons for this Clause. Basically, our policy has always been that vehicle excise duties are in aid of the revenue and not in aid of the prevention of traffic congestion.
I must confess that I am not a mathematician. I listened with the greatest interest and only a minor degree of comprehension to the hon. Gentleman's ingenious formula. When he got to his unit of block, I thought he was thinking of some kind of statistical unit we might use in this Committee for describing those hon. Members who from time to time felt it their duty to delay the passage of Government legislation, but the hon. Gentleman made it clear that this was a mathematically designed formula to try to measure congestion on our streets. I am one of those who is always a bit baffled by statistics. I remember the classic phrase, "There are three degrees of lies—lies, damn lies, and statistics". I must read very carefully what the hon. Gentleman said and take the necessary advice from those who know far more about mathematics than I do.
§ Mr. Hay
The hon. Gentleman may have found it so, but I did not. I would not like to give any answer upon whether it is feasible to measure congestion on our streets.
I think that we must have a sense of proportion. Although the private car is creating very substantial problems in the big towns and cities, we must remember that the private car is not only an outward and visible sign of the increasing prosperity of the people, but is also the end product of a thriving and highly prosperous industry providing employment for a great many people. It may be that in years to come the idea, as suggested by the hon. Gentleman, of making greater use of cheaper and smaller taxis will be adopted in this country, and to that extent the motor vehicle building industry will benefit.
But I do not believe at the moment that it would be wise or right for the Government to adopt as a policy the artificial restriction of the use of private transport in any part of our country, difficult though the problems are which the indiscriminate use of that transport causes. After all, this is a free democracy and people are entitled to buy cars and to use them. All we ask is that they shall not use them to such an extent and in such a way that they inhibit and prevent the rest of our fellow citizens from making a fair use of their vehicles.
On that general explanation of the Clause, and not wishing to delay the Committee longer and with appreciaion of the hon. Gentleman for entertaining us and putting inside a rather humorous approach a germ which is of great interest to us all, I hope that the Committee will be prepared to pass the Clause.
§ Mr. Benn
I would draw attention to another Section of the Vehicles (Excise) Act, under which some vehicles are totally exempt—such as fire engines, vehicles kept by a local authority, ambulances and road rollers, and it may be that some reduction, or the elimination, of vehicle Excise duty for public transport vehicles may be an incentive to those vehicles to proliferate, and may be to the advantage of the motorist.
Nothing I said in any way indicated the desirability of prohibiting cars in 1432 the middle of cities. It is a question of supply and demand. All I said was that the trouble at the moment is that people are entitled to buy cars, but cannot use them because of blockage in the cities. But I will say no more except to remind the Committee of a cartoon, which appeared in the New Yorker, showing some directors looking out of a window at a big motor manufacturing plant and saying, "It has happened at last: there is a traffic jam from the production line to the parking lot."
§ Question put and agreed to.
§ Clause ordered to stand part of the Bill.
§ Clause 11 ordered to stand part of the Bill.