New Clause A.—(RESTRICTION ON THE USE OF STORAGE FACILITIES.) (Hansard, 21 July 1961)

§ Mr. Soames
I beg to move, That this House doth agree with the Lords in the said Amendment.
This new Clause was inserted by the Select Committee in another place to meet a point made in a petition by the City of London, which was concerned to ensure that there should be no trading in any storage premises which the Authority might control outside the market area. As the House knows, it was never the Government's intention that trading should be allowed to develop in those storage premises. Indeed, the 1633 fundamental object of the Bill is to concentrate the trading into a single compact market precinct, but while this was the purpose as the Bill left this House after its Third Reading, the subsequent examination of it revealed this possible loophole.
There was to be this annex outside the area, and it was felt that there might be a possible danger that trading might be carried out from that annex, in addition to its fulfilling the function which was always envisaged for it, namely, the storage of bulk produce, empties, and the like. This Lords Amendment was put in to ensure that it would not be used as a place of trading.

§ Mr. Doughty
This new Clause is on a very different basis from that of the other Amendments inserted by the other place. This is entirely a new matter, not in any way an addition to or variation of the wording of the old Bill. It is an extraordinary Clause. For a reason which is quite beyond me, a Clause dealing with storage facilities comes into being immediately after a Clause dealing with provisions relating to the service of documents, necessarily a technical matter, and immediately before another Clause which says that this Act shall be deemed to be an enactment which has been in force since 1947.
They may be two very important matters, but they are totally unrelated to this new Clause. Even if we were to agree with it, it would be quite out of place there in the Bill where it is proposed to put it. Apart, however, from the question of where it is to be put in the Bill, and the finding of a more suitable place for it in the Bill, it will have an effect on the trading which actually takes place in Covent Garden.
I can understand what I suppose to have been at the back of the mind of somebody, whether it was the Select Committee or the City of London, in drafting the Clause. It is to say that the place for the bulk storage will not be used as a place where a salesman stands beside his business selling to people. In my view, however, that is very likely to happen, because I do not agree with those who apparently think that they are to change the whole system of the market where they have been used the whole time to selling not by sample but by 1634 bulk, and buying by bulk and seeing what they buy. This new Clause may suit the lawyers, but it will undoubtedly lead to a tremendous number of infringements, since trading in the market is not done by sample, but by bulk.
Let us look at an instance of an ordinary commercial sale which may occur at the storage premises even if this Clause is agreed. A greengrocer may want to buy some potatoes. He goes to someone whom he knows in the market. He says, "Have you any potatoes for sale?". The salesman says, "Yes, I have, at so much a cwt." The buyer is perfectly entitled to say, "I want to see what I am buying." The salesman says, "Come over here with me and I will show you where these things are." It would be perfectly likely then that the buyers would say, "I will buy." That is when the contract is made. Up to that moment there have been only negotiations.
If this Clause goes through the prospective buyer will have to say, "Thank you for showing me. We will now go back to Covent Garden or to your office and there I will tell you that I am going to buy." But will he? If he does not, an offence will be committed against the Clause or against the Authority's regulations. Whether the contract, in those circumstances, would be legally binding or not is an interesting question which I do not propose to deal with now, but there is an argument for saying that the whole contract would be illegal and for saying that the Authority could say, "This contract was illegal according to our regulations," even though it was an ordinary commercial contract.

§ Mr. Speaker
The hon. and learned Member must confine himself to something which arises on this new Clause. It seems to me related, unless I have misread it, to premises provided by the Authority for storage facilities provided by the Authority.

§ Mr. Doughty
With respect, Mr. Speaker, it was entirely to those premises provided by the Authority for the storage in bulk of produce, and provided outside the area, to which I was addressing myself. In fact, in those premises in which the storage takes place a vendor can show his customers goods in bulk, and on many occasions they will want 1635 to enter into contracts about the goods they see in bulk in that place, but if they do they will then be offending against the Authority's regulations, which the Authority presumably will pass under this Clause if it is agreed to.
I am sure that it is not the intention of the Minister and I am sure that it is not the intention of the House that that should be the effect of the new Clause, which we have not had an opportunity to debate before now, and I would ask the Minister to look again at the wording of the Clause. I agree with him that he does not want and that the Authority does not want to see such business transferred to the storage premises, but the wording of the new Clause will have the effect of very much hampering the ordinary trading business of the market in the way in which it is nominally carried on, and it may have more far-reaching effects than perhaps the Minister realised when he or somebody else drafted the Clause.

§ Mr. John Hall
I rise in support of my hon. and learned Friend's criticisms of this Clause. What this Clause seeks to do is to change the customs and habits of many years. It has long been the established custom and habit of the market for buyers to buy through their inspection in bulk, and, of course, that is one of the reasons why we have this appalling traffic congestion and chaos in the Covent Garden area. This seeks to change that, and I find it a little odd that the Clause should come forward, I suspect with the wholehearted approval of the Opposition Front Bench. I find it odd because in this unholy alliance between the two Front Benches the Opposition Front Bench is really basing its support of the Bill upon the representations made by the trade union concerned that customs and traditions which have been built up in that area for many years should not be changed. And to move the area elsewhere might indeed upset established customs built up over many years.

§ Mr. Mellish
On a point of order. If the hon. Member is perfectly in order, as I gather he is, in developing that argument, I hope that I shall be allowed to answer it and to say why we support 1636 the whole Bill in principle, and to refute this charge.

§ Mr. Speaker
I have not heard enough from the hon. Member for Wycombe (Mr. John Hall) to know yet. I do not understand what some of the words mean and, therefore, I have to listen to the debate a little.

§ Mr. Hall
I was making the point that the Clause will attempt to change the customs and traditions built up over many years. The Clause is likely to be supported, although the Bill as a whole is being supported by the Opposition for quite different reasons, namely, that hon. Members opposite oppose any change in the tradition and customs.

§ Mr. Speaker
I do not think that the motives activating the Opposition in their attitude to the Bill as a whole are reasonably related to discussion of this new Clause.

§ Mr. Hall
I will have regard to your Ruling, Mr. Speaker, and come back to some other point which the new Clause raises in my mind.
As my hon. and learned Friend the Member for Surrey, East (Mr. Doughty) has rightly said, when a buyer goes to Covent Garden to make a purchase he will be reluctant in many cases to buy entirely on sample. I know that the custom of buying on sample has spread considerably. It has spread among the very large buyers, but in buying on sample they often do it after inspecting the produce in its growing stage on the farms and agricultural holdings. They know a good deal about their suppliers and they want a lot of information before they are prepared to buy on sample.
These buyers representing large organisations have vast experience. This does not apply to the large majority who buy in Covent Garden. They will wish to see the bulk before they buy. The intending buyer will go to the storage depot where the bulk is stored and, human nature being what it is, if the parties do not actually conclude the transaction in the premises provided by the Authority they will go outside and complete the buying and selling on the pavement. A large number of transactions will be taking place.

§ Sir J. Vaughan-Morgan
And that will be very dangerous and will cause further traffic congestion.

§ Mr. Hall
I agree. It is an undesirable development, and it is not intended or desired by the Minister.
Another problem which will arise is perhaps a little wider. If I remember correctly, we were told on Report and Third Reading that if the Authority at a later stage found that the duty laid upon it to rebuild Covent Garden Market adjacent to this site was unduly onerous and it came to the conclusion that it was wrong, it could introduce another Bill in the House to give it power to establish a market elsewhere.
The provision in the new Clause makes this even more difficult, for several reasons. The Authority might choose an area such as, for example, the projected King's Cross site for the storage of produce. It might consider it a suitable place to set up a storage depot of that kind. It might do so with the object in mind of seeing whether or not that would be a suitable place to which at a later stage the entire market might be transferred. It might be a form of pilot scheme. The provision of a bulk storage depot of this kind would be a valuable opportunity for introducing a pilot scheme of that nature.
The new Clause prohibits the Authority from trying out the effect of combining storage with buying. It shackles the Authority considerably in its own efforts, but it will not prevent many transactions taking place outside the immediate control of the Authority and within the immediate precincts of the new depot which the Authority is to set up. It is a great pity that Her Majesty's Government did not accept their Lordships' original decision on this, which would have given the Authority much greater flexibility in dealing with the whole problem.
When I read the Lord Chancellor's speech in another place I was reminded of another quotation from the same very popular opera, which my hon. Friend the Member for Southend, West (Mr. Channon) will no doubt recall. It is also related to the Lord Chancellor and reads: The Law is the true embodiment Of everything that's excellent, And I, my Lords, embody the Law. It has no kind of fault or flaw, 1638 When one reads the Lord Chancellor's speech one has that impression, and it is a great pity that it has been necessary to introduce this Clause. If the original Amendment first passed by another place had been accepted, this would not have been necessary and the Authority could have had greater flexibility in the proper control and administration of the market.

§ Sir J. Vaughan-Morgan
Before my right hon. Friend replies to the very cogent criticisms of my hon. Friend the Member for Wycombe (Mr. John Hall), I would be glad if he could explain to those of us, who have not studied the matter with the same diligence as my hon. Friend, what kind of sanctions the Authority will have against anybody who may choose to indulge in these transactions within the premises. The Clause states that the Authority will not provide facilities. I take that to mean that the buyer and seller can exchange a contract verbally, having inspected the goods, without the Authority knowing anything about it. This could result in the spread of the market, which it is the purpose of the Bill to prevent.
I hope that my right hon. Friend will tell us what exact sanctions the Authority will possess. This provision in the new Clause is a negative instruction. It instructs the Authority not to provide facilities, but the Authority, if it is to be an effective authority, must have power to prevent higgling within the area provided for storage. What sanctions has the Authority to prevent these transactions taking place in neighbouring houses or premises which are not intended for that purpose?

§ Mr. Turner
In supporting my hon. Friends, I would point out that the Clause actually encourages the setting up of an alternative market when it says that the Authority should not provide facilities for carrying on business transactions. I, too, do not pretend to be a complete expert on every line of the Bill, but I do not recollect any restriction in it on firms outside the market area itself. In other words, in the provision of any storage facilities which the Authority may set up there is no restriction to prevent somebody setting up offices in the immediate vicinity of those facilities and carrying out the activities of marketing in that vicinity. The Clause 1639 seems to me to be doing just the opposite to what the Bill is intended to carry out.

§ Mr. Channon
I also am not an expert on every line of the Bill, but it seems to me that to get the new Clause into full focus we must discover what "facilities" mean in its context.
"Facilities" is defined in the interpretation Clause, Clause 54. There, we see: 'market facilities' has the meaning assigned to it by subsection (1) of section sixteen of this Act". One of the troubles facing us is that when we look at Clause 16 (1) we read: On and after the vesting day it shall be the duty of the Authority to provide within the Covent Garden Area facilities … for the conduct of a market …". What could be vaguer or more inexplicit than that? There is no way to define it properly.
I am sure that my hon. Friend the Member for Wycombe (Mr. John Hall), with his great assiduity in studying the Bill, will have noticed that if one seeks a definition of "storage facilities" one is referred to Clause 16 (3), which says: It shall be the duty of the Authority to provide, so soon as practicable, adequate facilities … for the storage of horticulture produce. The Clause is very vague.
My hon. Friend, however, places the House in a real difficulty. After having heard the cogent arguments addressed by him, my hon. and learned Friend the Member for Surrey, East (Mr. Doughty) and my right hon. Friend the Member for Reigate (Sir J. Vaughan-Morgan), no doubt the House will wish to alter the Clause. That puts us in an awkward position. It would mean the abandonment of the Bill. We cannot amend it, and if we now drop it, the whole elaborate process will have to be gone through again. I am sure that the last thing my hon. Friend the Member for Wycombe wants to see is the abandonment of the Bill after the study and care he has devoted to it. I hesitate to think that my hon. Friend's efforts have been wasted and that we want at the last moment to lose the Bill. Will he tell us what course of action he would recommend to those of us who feel deeply, as I do, that his arguments ought to command the respect and attention of the Minister and the House in general?

§ Mr. John Hall
I am very grateful to my hon. Friend the Member for Southend, West (Mr. Channon) for everything that he has said. I agree completely with all his arguments. He has drawn attention to a very real difficulty which faces the House. Perhaps we might have your guidance, Mr. Speaker, on this. What would happen if the House decided that the Clause as drafted did not really meet the requirements which many of us have in mind?

§ Mr. Speaker
There is no need to waste the hon. Member's time about it. The Question which I put was "That this House doth agree with the Lords in the said Amendment". That refers to the Clause as a block. The House has the opportunity of agreeing to it or rejecting it.

§ Mr. Hall
May I ask for further guidance, Mr. Speaker? That would not mean, I trust, that if we rejected the Amendment the Bill as a whole would be affected? May I take it that the Bill would still go forward although we rejected the new Clause?

§ Mr. Speaker
If the House were to reject the Amendment, no doubt the House would, by the appropriate procedure, state its reasons, and then the Bill, plus the reasons in respect of the rejection of the Amendment, would go back to another place.

§ Mr. Hall
In that case, I am very tempted to suggest that we ought to ask their Lordships to look at the Clause again. After all, a great deal of time has been spent in close study of the Bill. A number of different recommendations have been made. The Runciman Committee spent a great deal of time on the subject, and not all of its recommendation have been accepted or embodied in the Bill, which, in some respects, is a pity.
Therefore, it would be a pity—I am sure the House will agree—if in a moment of haste, because we wanted to finish the Bill today, we spoilt what might otherwise be a reasonably good Bill—subject to certain mental reservations which I have about it—for want of giving their Lordships an opportunity to consider it again. I hope that when the matter is put to the House we shall consider very seriously whether we should not reject the Clause as it now 1641 stands and send it back for their Lordships to think about it again.

§ Mr. Mellish
To continue the unholy alliance, I want to make it clear why I support the new Clause. It is a very wise and sensible one. Hon. Gentlemen opposite claim that they have read the Bill carefully and studied the debates and know all about it. I am surprised that they do not understand the very simple reasons why the new Clause comes into being.
First, we had the problem of whether or not there should be an annex for this purpose. At one stage, there was to be an annex in a certain place. It was petitioned against and there were terrible rows, and eventually the proposal was withdrawn. The Bill now says that the Authority will be allowed, as the Authority, to provide or obtain facilities outside its own area for the purpose of storage, and we hope that the bulk will be very much reduced as the months and years go by.
We have already said that we think that the Authority will have tremendous trouble in any case wherever it tries to put up or allow for any annex for these facilities. If it does it inside London there will be a tremendous quarrel with the borough council in the area. That being so, and with the knowledge that the Authority is already handicapped, we can well understand why the City of Landon comes forward with a petition—far be it from me normally to support the City of London as an authority, but I do so on this occasion—and says "In any case, if facilities are allowed we do not want any trading there, because if that happens you make another market."
Hon. Gentlemen opposite have complained about the traffic. If it is proposed to have in the Metropolitan area a considerable number of little markets, the situation will become disastrous. The traffic congestion will be very bad indeed. Consequently, it is suggested by the City of London that if these facilities are to be granted, no trading shall be attached to them.

§ Mr. John Hall
I feel that the hon. Member for Bermondsey (Mr. Mellish) has not paid to the speeches which have 1642 been made by my hon. Friends the attention which he normally pays to speeches from this side of the House. If he had listened with care he would have understood that what we fear is that the desired result will not be achieved despite what is proposed, and that, despite what the Clause says, it will not be possible to prevent a market springing up within the immediate vicinity of the new depot, which will be more dangerous from the point of view of traffic chaos than if trading were allowed inside the premises. Although we do not quarrel with the intention of the Clause, we believe that because of the way in which it is worded it will not achieve the desired result. Perhaps the hon. Gentleman will address himself to that point.

§ Mr. Mellish
I apologise to the hon. Member for Wycombe (Mr. John Hall) for not having understood his argument. I usually do, because he speaks so very clearly. On this occasion, he must have confused me. I can only say that unless we have a Clause of this kind the storage facilities which will be provided under the Measure as it stands may become a trading centre outside the normal trading centre. It is necessary to have a restrictive Clause of this kind to state that trading shall not be carried on in the place where the facilities are provided. Consequently, I feel that the Clause is right. The City of London has understandably put forward a petition because of its worries about this as the Bill now stands.
My hon. Friends and I will support the proposed Clause because we feel that the Minister has given adequate reasons why such a Clause should be embodied in the Bill.

§ Mr. Soames
I hope very much that the little discussion which has taken place about what would happen if the House were to reject the Amendment will be shown to have been purely an academic one in as much as I think that I can help to clear up what I sincerely believe to be nothing but misconceptions in the minds of certain of my hon. Friends.
I think I can sum up what was felt by my hon. Friend the Member for Wycombe (Mr. John Hall) and other hon. Friends of mine. They said that they were in agreement with what we were trying to do, but they felt that the Clause 1643 would not succeed in its objective. What we are trying to do is to ensure that the storage facilities do not become also a centre of trading. When we were drawing up the Bill we never thought that there was any doubt about this. We always thought that storage facilities would be provided and that there would be no trading there.
We thought that the extent to which the storage facilities were used would depend very largely, in fact almost entirely —I am talking about bulk storage—upon the extent to which it was possible to introduce sales by samples in the market as time went on. We thought that the object of the Authority would be to maximise the trade and not minimise it, and we thought that if it could not sell by sample, it would not try to sell by sample.
It was put forward as an anxiety that perhaps it was not clear beyond a peradventure that as the Bill stood there could not be some trading from the annex. If they fear that the Bill with this Clause in it might mean that there would still be trading from the annex, what would have happened if the Clause had not been in the Bill? This point was not made earlier in this House, and since it left the House the position has been fortified by the addition of this Clause.
So much for the overall strategic concept, so to speak. What about how it is going to work? How will it work, in fact? My hon. and learned Friend the Member for Surrey, East (Mr. Doughty) was alarmed by the thought that there might be a lot of trading. I think he will agree that there is less likely to be trading with this Clause in the Bill than without it inasmuch as the Clause prohibits the authority from allowing trading to be carried on in the premises.
Before one considers the argument one has to paint a picture in one's mind of what the storage facilities are. I saw the site where I hoped that it was going to be, at Finsbury. I saw the land and walked over it, and I foresaw enormous covered places where produce would be stored in bulk. I hope that it will be run in a most businesslike fashion. There will be the base where these goods will be stored and they will be called forward by the merchants. The goods will not be on view to the trade.
1644 The whole purpose of selling by sample is to avoid the goods being on view. The purchaser looks at the sample. He may decide that he wants something else. Then he is shown another sample. Even if he were to go to the annex and try to look at the produce he would probably have great difficulty in finding it. The goods will not be presented in such a way as to attract attention. They will be there and will be called forward as required.
I cannot tell how the Authority is going to run the thing. But this does not prohibit a man from having a look at the produce. What it prohibits is the setting up of trading there. My hon. and learned Friend, who is learned in the law, says he thinks that it would be very difficult to decide whether a contract was actually made there or elsewhere.
Thanks to this Clause, this is not going to be a place where the atmosphere will be a trading one. It will be a storage atmosphere. The people concerned will not be salesmen. There will be foremen—men saying where the stuff should be put—and men loading and unloading. The purpose of the Clause is to see that there are no tradesmen or salesmen there. We did not feel this anxiety ourselves. We did not think that this was necessary. In our view, this Clause makes the position clear beyond a peradventure.
We wanted to avoid the annex being used partly for selling produce with the bulk hard by, so to speak. I think it will work. It makes the matter quite clear, and I really cannot accept the argument put forward by my hon. Friend the Member for Woolwich, West (Mr. Turner) that the insertion of a Clause saying that the Authority is prohibited from using the premises for trading makes it more likely that the storage facilities would be used for trading.

§ Mr. Turner
I am most grateful to my right hon. Friend for giving way. All I am saying—I agree with my hon. and learned Friend the Member for Surrey, East (Mr. Doughty)—is that, in my view, we are not going to stop verbal contracts taking place. The only point I was trying to make was that if we actually prohibit trading I can see that trading spreading outside and the matter of verbal contracts spreading. It seems to me more likely to create salesmen 1645 outside. I am with my right hon. Friend in wanting to prohibit trading completely, but what I am saying and what my hon. Friends are saying is that we do not believe that the wording of the Clause so prohibits it.

§ Mr. Soames
The wording of the Clause quite definitely prohibits it. I do not see what more could be said. The Clause states: … the Authority shall not permit the use of any storage facilities which may be provided for them outside that area, or of any premises in which storage facilities are so provided by them.

§ Sir J. Vaughan-Morgan
I think that my right hon. Friend has got down to the nub of things. What I am asking—and I think that this would be echoed by my hon. Friends—is what sanctions and penalties the Authority can impose. That is what we want to know.

§ Mr. Soames
That is an important point. In the tenancy agreements with the traders the Authority will lease facilities in the annex to the traders, and the traders will use those facilities for storage purposes. It will be incumbent upon the Authority, thanks to this new Clause, to write into the agreement, as in any other agreement reached between landlord and tenant, so to speak, that trading shall not be carried on in the annex.
The sanction will surely be that if a trader breaks his contract the Authority will terminate the tenancy. Indeed, it would be the duty of the Authority to terminate the tenancy in that case. It would say to the trader, "You have broken the terms of the contract and we now propose to terminate it."
I could understand the argument that this was not necessary because it was already inherent in the Bill, and I very much hope that when they consider the matter my hon. Friends will see that it is helping to achieve what we all want, namely, to ensure that trading does not take place in the annexe.

§ Mr. John. Hall
May I ask my right hon. Friend—

§ Mr. Speaker
The hon. Member requires the leave of the House to speak, I think.

§ Mr. Hall
I was interrupting my right hon. Friend. I appreciate the point that he has made about the sanc- 1646 tion available if a tenant enters into transactions to sell on premises provided by the Authority for the storage of bulk produce, but that does not deal with the point made by my hon. Friend that many of these transactions can take place immediately outside the premises and outside the control of the Authority altogether. I am sure that I shall get the support of the hon. Member for Bermondsey (Mr. Mellish) in saying that it is wrong to introduce into legislation something that cannot be carried out.

§ Mr. Speaker
It is really an abuse to make interventions at such length in circumstances where the hon. Member would require the leave of the House to speak. I hope that he will bear that in mind. It would appear that the Minister had, in fact, sat down. I suspected that that was the position, and it was, in fact, true.