Clause 1.—(POWER TO MAKE ADVANCES FOR CONSTRUCTION OF VESSEL.)

HC Deb 30 May 1961 vol 641 cc39-108

3.45 p.m.

Mr. G. R. Strauss (Vauxhall)

I beg to move, in page 1, line 8, to leave out "eighteen" and to insert "twelve".

The purpose of the Amendment is to reduce the loan of £18 million, which the Government propose to make to the Cunard Company for the purpose of building a new ship, to £12 million. Before I come to the body of the Amendment I must say how surprised my colleagues and I were, when we saw the Notice Paper today, to find that, despite all the noise and protests and outbursts of indignation from Members opposite during the Second Reading debate, not a single hon. Member opposite has put down an Amendment to try to improve the Bill or to alter it in any way. It is particularly surprising, in view of the threats of some hon. Members opposite to deal with the Bill in Committee.

The hon. Member for Sunderland, South (Mr. P. Williams) said that he hoped that the Bill would be strangled in Committee, but he has not put down a single Amendment himself—nor, indeed, have any of his colleagues. We are, therefore, most anxious to know what has happened. Why has this criticism vanished? Have Members opposite been told off by the authorities of their party? Have they been whipped by the Whips and told that they must not go on being naughty boys? I do not know, but something strange has obviously occurred to change this mood of criticism and opposition to one, apparently, of compliance with and acceptance of the Bill.

It will be interesting to see to what extent they give support to this Amendment, which is an exceedingly important one, and which seeks to reduce the amount which the Government propose to lend to the Cunard Company by £6 million. That is not an arbitrary figure. We have good reason for suggesting it.

During the Second Reading debate, many Members on both sides doubted the wisdom of devoting such a very large part of our national resources to this venture. They thought that these resources could be used for much better purposes in helping our country by developing our inventions and furthering its interests in other ways. One Member opposite went so far as to condemn the Government for trying to support an outmoded status symbol.

Some of us on this side particularly considered that, if one took into account the traffic in the North Atlantic, it was probable that the numbers of people likely to cross by sea in future would fall. It seemed that there was considerable evidence to support that contention, but it was not the view of the Government. They may be right and we may be wrong, but the Minister of Transport said, by implication, that he thought that this venture was likely to be commercially justifiable.

Presumably that is the view also of the Cunard Company, otherwise it would not be putting up its money and undertaking to build this great ship. Therefore, we asked many times during Second Reading why, if it was the view of the Government and of the Cunard Company that this was commercially desirable and had good prospects, the company was not putting up a larger slice of the money. It was asked why the company was demanding £18 million from the Government. The answer we got to that question was that this was all the Cunard Company could afford to put up. When we said that the company had reserves of £35 million in the balance sheet, we were told that we must consider the company's fleet and the number of replacements it had to make from time to time, and that its reserves were all earmarked for that purpose.

The answers at that stage sounded, if not convincing, at any rate plausible. But it so happens, by a fortunate coincidence, that at the same time that we are considering this Bill today, with the proposed loan of £18 million to the company on the ground that it cannot afford more money to finance the ship itself, the company is proposing to spend £6 million of its money in buying two aeroplanes, which will compete with the new ship to which the Government are contributing such a large sum, and will compete even more severely with our nationalised, publicly-owned British Overseas Airways Corporation. We cannot now accept the argument that the Cunard Company, if it wanted to, could not have put up more money for the ship, as it now proposes to spend £6 million in buying two aircraft to fly across the North Atlantic.

It therefore seems logical to say, in view of what has happened since Second Reading, that the Government should reduce this loan by the £6 million which the company now finds that it can afford in order to operate these two aeroplanes, which would compete with, and damage considerably, the interests of a publicly-owned corporation. Why should the Government lend money to a private company which will free an equivalent amount of its resources to inflict grave damage on a public enterprise?

That, however, is what will happen if this proposal to lend £18 million to the company is accepted by the Committee. That proposition obviously violates the public interest and it should be decisively rejected. The Cunard Company is fully entitled, under an Act passed by Parliament, to apply for a licence to run a trans-Atlantic air service in competition with B.O.A.C. We strenuously opposed that Act, but it was passed, nevertheless, and the company is entitled to make this application. We do not, however, think it should make this application on the strength of money which it is to borrow from the Government for another purpose. Yet that is what is happening.

The Committee should realise what the consequences are likely to be if the application is granted. These two aircraft will form the nucleus of a fleet which will compete with B.O.A.C. a publicly-owned enterprise whose capital is entirely owned by the taxpayer, and will deprive B.O.A.C. annually of a gross income of £7½ million. That is the best calculation that has been made. Admittedly, it has been made by B.O.A.C., but it has not been controverted.

Thus, if the application succeeds, B.O.A.C. and the taxpayer will lose £7½ million a year in gross receipts. That will inevitably do grave harm to B.O.A.C. and to the taxpayer and will seriously prejudice the effectiveness and competitiveness of B.O.A.C. in world air transport. It would be a tragedy if the Cunard Company was allowed to do this, and it will be madness if it is enabled to do so as a result of a loan given by the taxpayer which will free £6 million of the company's resources for investment in these aircraft.

Our case is that in view of the company's intention and apparent ability to invest £6 million in another venture, we cannot accept the contention that it is impossible for it to find another £6 million to build another new "Queen". The Government loan should, therefore, be reduced by a corresponding amount.

Moreover, when we know that the company's £6 million, if it is permitted to be invested in this way, will threaten the solvency and prestige of a world-renowned, publicly-owned British enterprise, the case for this Committee refusing to assist it in carrying out its plans is overwhelmingly strong. We therefore invite the Committee to accept the Amendment and to say that, in view of the circumstances and the change which has arisen since Second Reading, we should now reduce the proposed loan from £18 million to £12 million, and should ask the Cunard Company to use the £6 million which it has available to buy aircraft for building the new ship, and thus impose a lesser burden on the taxpayers.

Mr. Paul Williams (Sunderland, South)

The right hon. Member for Vauxhall (Mr. Strauss) has enjoyed himself in twitting me for not having put down Amendments. My view is that it is perfectly reasonable, as we are taking a line almost identical to his on Second Reading and on this Amendment and perhaps in due course on the Question "That the Clause stand part of the Bill", to use those opportunities to "strangle the Bill in Committee stage". If the right hon. Gentleman wants to twit me for not having put down Amendments, I do not mind. What he is saying will not alter my view about supporting his Amendment and supporting him on other issues later.

The issues which the right hon. Gentleman raised in connection with Cunard-Eagle Airways and B.O.A.C. were irrelevant and that matter, which is now before the Air Transport Licensing Board, ought to be determined on its merits and not by external considerations such as those which the right hon. Gentleman mentioned. The right hon. Gentleman will recognise that I have always supported, and still do, the general principle that there should be competition on the air routes so as to provide a stimulus and incentive to B.O.A.C. and so that the second carrier could provide services which the public needs.

Having said that, I think that there is justice in the right hon. Gentleman's attempt to reduce the amount of the Government advance from £18 million to £12 million—the difference of £6 million being the figure which the right hon. Gentleman talks about in connection with the Cunard-Eagle development.

The most interesting thing which has come out of the Air Licensing Board conversations is the remark made by Sir John Brocklebank, which was reported in The Times on the 19th of this month, when Sir John was asked about financing developments in the air. He said that there was no inability to find more than the £12 million. I go on to use his exact words: It should be 'unwillingness'. The amount to be found was not the crucial point: it was the risk element and the profit element of any unit which had to last 25 years and cost £30 million. With respect to the Cunard management, that appears to cast aspersions on the managerial ability and risk-taking qualities of Cunard and on its confidence in the future. On those grounds alone the Amendment is worth supporting.

If one makes comparisons with other shipping companies which are sustaining their own rebuilding programmes out of their own profits, for example, P & O, one sees that it can be done. We have not arrived at a moment when the nation needs to provide £18 million of taxpayers' money—the line which the right hon. Gentleman took up and which, I regret to say, I launched on Second Reading—for building ships when the company itself is using its own money for getting into air transport. This is a perfectly legitimate moment for trying to strangle the Bill in Committee and on those grounds I support the right hon. Gentleman in asking for a reduction of £6 million in the money to be made available.

4.0 p.m.

Mr. E. Shinwell (Easington)

After that speech we shall expect to see the hon. Member for Sunderland, South (Mr. P. Williams) in the Division Lobby with us so that he can perform this strangling operation, or, at any rate, make his contribution, however modest, to it.

The hon. Member quoted from The Times the remark of Sir John Brocklebank—which, strangely enough, I saw in no other newspaper—and that remark confirmed our demand, voiced on Second Reading, that the Report of the Chandos Committee should be submitted to Parliament.

It is obvious that the risks suggested by Sir John Brocklebank must have been known to the Government and, therefore, to the Chandos Committee. That risk has been undertaken by the Government and it is a risk which involves the Government in the payment of more than £3 million and a loan at a rate much below that at which it would have been provided in the City of London—for it is obvious that if the Cunard Company had applied for a loan from that quarter it would have had to pay not 6½ per cent. but at least 8 per cent. and probably 10 per cent., having regard to the risks involved.

Why should the Government undertake this risk? Were they so very anxious to boost the shipbuilding industry, which is now in a sluggish condition and which may remain so for a considerable time, that they decided to provide what many people regard as a white elephant, as it has been described in the columns of The Times and other reputable newspapers? Was it necessary for the Government to undertake this risk?

I pose what I believe is the fundamental question which ought to be answered by the Government and by hon. Members opposite, some of whom have an interest in this project. I am glad to see that the hon. Member for Gillingham (Mr. Burden) is in his place. On Second Reading he made a long and eloquent speech from a brief no doubt prepared by the Cunard Company or its subsidiary.

Mr. F. A. Burden (Gillingham)

There was no brief prepared by the Cunard Company. I am not a director of the Cunard Steamship Company, but I feel very strongly about the matter. I have an association with it, but I took considerable trouble to dig up the facts for myself.

Mr. Shinwell

Of course the hon. Member has an association. Is he not a director of the subsidiary, Eagle Airways?

Mr. Burden

Yes, and I declared it.

Mr. Shinwell

This is almost a violation of the Illegal Practices Act. After all is said and done, the hon. Member comes to Parliament and makes a plea for a substantial grant of money from the Government out of the pockets of the taxpayers, for whom he sometimes makes eloquent pleas, and then he has to declare his interest in the project.

It might have been more honourable on the hon. Gentleman's part if he had left it to others without a financial interest in this project. Of course he has a financial interest. The sum of £6 million is to be provided by the Government to provide this air project which could have been amply provided by the Cunard Line itself. Talk about corruption! This is about the worst example of corruption which I have seen in the House of Commons for many years and it ought to be condemned, as I condemn it. What extenuation of the hon. Member's conduct may emerge I do not know.

Mr. Burden

On a point of order. The right hon. Member for Easington (Mr. Shinwell) is imputing to me motives which do not exist. I have always declared my interest in this matter. May I, through you, Sir Gordon, ask that the right hon. Gentleman should not be allowed to impute dishonourable motives to an hon. Member who happens to speak about an undertaking with which he is associated, but in respect of which he has declared his interest?

The Chairman

I hope that the right hon. Gentleman was not attributing corrupt motives to the hon. Member for Gillingham (Mr. Burden).

Mr. Shinwell

I wonder what it is, then. Suppose, for example, I came to the House having a financial interest in a project which required a substantial grant from the Government before it could be implemented. How would it be regarded by hon. Members opposite? It seems to me that it is a most dishonourable act on the part of the hon. Member to come forward attempting—

The Chairman

The right hon. Member for Easington (Mr. Shinwell) must not use the word "dishonourable".

Mr. Shinwell

Naturally, I am quite willing not to do so if you say that I ought not to use that word, Sir Gordon, but that is my conviction, nevertheless, and I feel very strongly about it. It is most deplorable and I have been waiting for an opportunity of saying so.

Mr. Burden

On a point of order. I must ask for your indulgence and protection, Sir Gordon. Although the right hon. Gentleman said that he would withdraw on your instructions, he immediately said afterwards, "Those are my views". The right hon. Gentleman should have the courage either not to withdraw the remark and to defy the Chair, or have the grace and good manners, which the House of Commons usually possesses, to withdraw in a gracious and proper manner.

Mr. Sydney Silverman (Nelson and Colne)

Further to that point of order. Are you ruling, Sir Gordon, that it is out of order on the part of an hon. Member to say that another hon. Member would be acting more honourably if he kept silent about a project in which he has a personal interest? What is wrong with saying that?

The Chairman

There is nothing wrong with saying that, but it is wrong to attribute to any hon. Member action based on dishonourable or corrupt conduct.

Mr. Shinwell

I cannot understand this. I do not think that I have infringed any rule. I have been in Parliament for a long time and I understand its rules and I would not make any accusation against the hon. Member if it had not been for the speech which he delivered on Second Reading and the inescapable fact that he has a definite financial interest in this project. Let him deny it if he can. I think that I am entitled to express my views on his conduct. Of course he does not like it, which is precisely why I am saying it. Acts of this kind should be exposed. That is what I am doing and I hope that notice will be taken, both here and elsewhere.

Let us consider what the position is. I was about to pose the question whether it was necessary for the Cunard Line to obtain this grant. Did it not have any money? Did it not have ample reserves? It has been admitted by those who took part in the recent inquiry, about whether the Cunard Company should be permitted to exploit the air routes through its subsidiary Eagle Airways, that the company had adequate funds available. The hon. Member for Sunderland, South quoted what Sir John Brocklebank has said. I repeat it, for it should be placed on record. Sir John said that there was no inability to find more than £12 million and said: It should be 'unwillingness'". What does that mean? What interpretation can we place on that statement?

The Cunard Line had the money, but was unwilling to provide it because the weak-kneed Government were prepared to come to its rescue. Why? Why are the Government not prepared to come to the rescue of other ship-owning firms? Why are they not prepared to come to the rescue of ship-building, which has suffered a very heavy blow?

Why come to the rescue of the Cunard Company which, as its chairman admits, came to the Government not because it needed the money, but because it was unwilling to find it? What does it do with the money it has? It uses it for the purpose of entering into competition in the air. I do not object to competition if it is essential. I agree with the hon. Member for Sunderland, South. If it is essential to have competition in the air, or elsewhere, let us have it if that is of advantage to the nation. The Cunard Company did not require this assistance. Why is it getting it? I want an answer to that question.

Mr. Fisher, who was conducting the inquiry, questioned Mr. Banberg, who is, presumably, associated with Eagle Airways. He agreed that £16 million was shown on the Cunard Company's balance sheet as reserves for capital ship replacements and general contingency reserve. If £16 million is reserved for replacements, why do the Government consider it necessary to provide £3 million more by way of grant and £14 million at a reduced rate of interest? Those questions ought to be answered before the Bill goes through.

Mr. Banberg was also asked why the Cunard Company could not find more than £12 million for the new "Queen" if it could find £6 million for the Boeings. He said that it took about twenty-five years to amortise a ship. If the depreciation requires that period, clearly we ought not to proceed with a project of this kind. I have no animus against the Cunard Company. It has been responsible for considerable achievements in shipping. It has made great contributions to the progress of shipbuilding. I recognise all that, but if the money is to be made available—and, by the way, money is not available for other more necessary projects in other industrial spheres—and if the pockets of the taxpayers are to be tapped in this fashion, it should be done only for the purpose of assisting shipping and shipbuilding in general and should not be peculiar to the Cunard Company.

In my view there is no satisfactory answer to the question I put. I want to know whether the Government considered this matter from the standpoint of what was inquired into by the Chandos Committee. I repeat my request during the Second Reading debate. Let us have the Chandos Committee's Report and find out what is at the bottom of all this.

When the Government produced the Bill, were they aware that the chairman of the Cunard Company was strongly of the opinion that it was not because the company had not the money, but because of its unwillingness to provide the money that it wanted to saddle the Government with the risk entailed? If the Government were aware of that, they also are guilty of sharp practice in not informing the House of that fact. Let us get the facts, and on the basis of the facts let the Committee be honourable about it and vote accordingly.

Mr. Burden

The right hon. Member for Easington (Mr. Shinwell) would have been much more effective had he been less vicious and spiteful. I have always declared my interest in these matters. It is the accepted procedure that every hon. Member who speaks on any subject in which he has an interest declares his interest. On certain occasions I have heard the right hon. Member for Vauxhall (Mr. Strauss) declare his interest, and there have never been the abusive remarks levelled at him by hon. Members on this side as were levelled at me by the right hon. Member for Easington.

The right hon. Gentleman is not nearly so highly thought of today after his considerable failure to produce coal in this country, when he was Minister of Fuel and Power, during the war. As age comes along one is more moderate on these matters, but it seems to me that the Committee, including the right hon. Gentleman, and I hope that he will forgive me for saying this, has rather wandered from the terms of the Amendment. I should like to try to get the Committee back to the Amendment.

4.15 p.m.

It appears that the Amendment is being used as a vehicle by hon. Gentlemen opposite for attacking Cunard Eagle Airways Limited, of which I am a director, for its application to the Licensing Board for permission to fly the North Atlantic. It seems to me that the Amendment is being used as a veiled threat to the Licensing Board to try to stop it from determining in its own way within its terms of reference the decision to which it should come.

The project of the new "Queen" came about before I, as a member of Eagle Airlines, or, indeed, the Cunard Company, had the slightest idea that the two would become associated, and that the Government would bring in a Bill to enable that to be done.

Mr. Frederick Willey (Sunderland, North)

Does not the hon. Gentleman consider that because of the new circumstances a new figure should now be written into the Bill?

Mr. Burden

I shall deal with that point.

The right hon. Member for Easington was exaggerating when he said that, because Cunard Eagle Airways was due to spend £6 million on aircraft for the North Atlantic route, that would probably create insolvency in the B.O.A.C. If he believes that, it is time that the B.O.A.C. faced the competition which apparently right hon. and hon. Gentlemen opposite fear so much.

Mr. Strauss

A loss of £7½ million gross revenue from the B.O.A.C. might well turn a yearly profit into a yearly loss.

Mr. Burden

I do not accept that, and neither would the right hon Gentleman if he looked at this in an objective and honest way. Traffic on the North Atlantic route is increasing at an enormous rate each year. If, in five years, B.O.A.C. carried 80 per cent. of the total traffic, it would carry more traffic than if it carried 100 per cent. today.

Mr. Shinwell

rose—

Mr. Burden

I am sorry. I have no intention of giving way to the right hon. Gentleman. We are discussing the North Atlantic Shipping Bill. A separate one-ship holding company is to be formed which will be responsible for operating the new "Queen", and it would seem that hon. Gentlemen opposite have changed their views since the Second Reading debate.

Mr. Shinwell

What money has the hon. Gentleman put in as a director?

Mr. Burden

The right hon. Gentleman is offensive not only when he is standing, but when he is in a sedentary position.

Mr. Shinwell

The hon. Gentleman has admitted that he is a director of Eagle Airways. What money has he put into this fine project, which he thinks will succeed within the next five years? What money has been put in by any of his co-directors? Not a penny. The money is being put in by the Government.

Mr. Burden

It may well be—

Mr. Shinwell

Answer the question.

Mr. Burden

It may well be that my services are considered more valuable to the company than the services of the right hon. Gentleman opposite.

Mr. Shinwell

What money has the hon. Gentleman put in?

Mr. Burden

The position, as I see it, is this. What right hon. and hon. Members opposite have to make up their minds about is whether they really want this ship to be built; whether, in fact, if this Amendment were carried, and the Cunard company were to say, "We will no longer go on," they would be prepared to say, "We are glad that we did this, that we brought about this situation, and the unemployment and difficulties to the shipbuilding industry in the North are the result of our action" That is the position which hon. Gentlemen opposite would have to accept, and they must face it. They have to accept that if the amount is reduced to £12 million, the Cunard Company might well say, "We will not provide the extra money."

Right hon. and hon. Gentlemen opposite have made play with the fact that some companies have spent a considerable amount of money on shipping replacements since the war. It should be made clear that in this respect the record of the Cunard Company is second to none. It has already spent sums amounting to £30 million on ship replacements and rebuilding since the war, in the provision of smaller vessels which may be used properly and more flexibly in a fleet. The Chandos Committee and the Government decided that this ship must be of this size—

Mr. James Callaghan (Cardiff, South-East) indicated dissent.

Mr. Burden

The hon. Gentleman shakes his head, but if he looks at the facts and at the Report and the debate he will find—

Mr. Shinwell

Has the hon. Gentleman seen the Report?

Mr. Burden

—that the Chandos Committee and the Government—and also the French, have implied it by the size of the vessel that they are building—decided that this ship should be this size.

Mr. Shinwell

How does the hon. Gentleman know?

Mr. R. J. Mellish (Bermondsey)

The hon. Member for Gillingham (Mr. Burden) does not know what is in the Chandos Committee's Report, as he has not seen that Report. At least, I assume that he has not seen it. If he has, he should tell the Committee. That is another reason why we ought all to be able to see the Report. But the important issue is the terms of reference to the Chandos Committee. In effect, it was told that a Cunard liner of this size was to be built and it is the terms of reference to which we object so much.

Mr. Burden

That is not strictly true. The Minister has stated—I should have thought that the hon. Gentleman would have noted this—that the Chandos Committee made this recommendation, although it was not given to the Committee to read the whole of what was, in fact, the recommendation of the Chandos Committee regarding this.

We should be wise—I say this not because of my association with the company, but because I believe it to be so—to consider the two things as entirely divorced. This was a project entered into long ago, and I believe that if right hon. and hon. Members opposite are sincere and earnest about pressing this matter, they should also be prepared to accept full responsibility if the Cunard Company said, "Very well, we cannot go on and this ship will not be built"—with all the consequences which would follow.

Mr. Shinwell

And the hon. Gentleman would not be a director.

Mr. Burden

It is an extraordinary thing that the right hon. Gentleman—

Mr. Shinwell

I have got you.

Mr. Burden

—is not only noisy and offensive, but is so often so wrong in so many things that one wonders how it was that he ever became a Minister.

Mr. John Diamond (Gloucester)

There are three main reasons why I think that a new figure ought to be written into the Bill, but before explaining them in detail may I take up the speech of the hon. Member for Gillingham (Mr. Burden). With all respect and friendliness towards by right hon. Friend the Member for Easington (Mr. Shinwell), I suggest that he was a little too hard on the hon. Member for Gillingham. After all, think of the position of the Government. Were it not for the fact that the hon. Member for Gillingham has a personal interest in this matter and the hon. Member for Southampton, Test (Mr. J. Howard) has a constituency interest there would have been no speeches from the Government back benches in support of this Bill at all. It is the essence of democracy—

Mr. Callaghan

Even if they have to pay.

Mr. Diamond

Even if they have to pay.

With deference to my right hon. Friend, what was the point of asking the hon. Member for Gillingham what he had put into it? My right hon. Friend should have asked what he was getting out of it.

Mr. Shinwell

Ask him now.

Mr. Callaghan

My hon. Friend would not get an answer.

Mr. Diamond

This is the Committee stage of the Bill, and there will be ample opportunity for the hon. Member for Gillingham to enlighten us, and to fill in the details which he has left blank.

I say this with all seriousness. Every hon. Member is compelled, and, naturally, does so, to decide as he thinks appropriate about speeches made by hon. Members who have an interest in the matter. It is up to any hon. Member to assess such speeches and to discount—in certain obvious cases by 100 per cent.—speeches made by hon. Members who are directors or have a personal interest.

The first of the three reasons refers directly to the Minister and I must address these remarks precisely to him. During the Second Reading debate, and almost at the very start of the Minister's speech, he said: The story started two or three years ago, when Cunard told the Government that it could not find enough capital, either from its own resources or by borrowing on the market, to replace the 'Queen Mary'…"—[OFFICIAL REPORT, 1st May, 1961; Vol. 639, c. 914.] That is the statement of the Minister and we are entitled to rely on it. It was made in the first part of the debate on Second Reading and it is the most authoritative statement which could be made, in the most authoritative position in the context of the speech. We are now told, in the most authoritative way, by the most authoritative person from the Cunard Company, that this statement is not true.

This is an unfortunate position to be in, and I am indebted, as is the whole Committee, to my right hon. Friend for having brought it forward. It is all clearly stated, and one or other—the hon. Gentleman, who is a managing director, or the Minister—is wrong. I am putting at its minimum, and in absolutely appropriate Parliamentary terms, that this Committee is being misled by somebody, and we must have the matter cleared up so that we know where we stand. That is the first and a very compelling reason.

As my right hon. Friend pointed out when moving the Amendment, there is at least £6 million available in the coffers of the Cunard Company and there is no reason whatever—the Minister owes it to his own reputation—why the Amendment should not be accepted and the amount reduced to £12 million. That is the first and powerful reason touching the honour of the Minister and there is nothing more important than that to every hon. Member.

The second reason is what has happened since the Second Reading regarding knowledge of the appropriate size of liners and, therefore, the appropriate cost of liners of different sizes. I wish to quote from The Times of 25th May, from an article headed, "New liner for Atlantic". This new liner is to be a 30,000-tonner. Before I refer to the details, I wish again to refer to the Minister as the source of all reliable information. During the Second Reading debate he detailed reasons why this undisclosed Chandos Committee's Report recommended a very large ship and he concluded with the following sentence: Any ship which can operate on the Atlantic express passenger service is bound to be unsuitable for other trades."—[OFFICIAL REPORT, 1st May, 1961; Vol. 639, c. 920.]— that is to say, the tourist trade, winter cruises, and so on. The whole argument put up against a large ship was that a smaller ship could go cruising in winter.

The Minister's reply was definitely against this, and no doubt had some support which is not disclosed to us and to which we pay no attention. Whatever the party rules may be, there is one certain thing, that none of us will pay attention to a Report which we are not allowed to look at. Whether the Minister should be required to put the Report on the Table is another matter. But if the Report is not disclosed, we are not bound by it.

4.30 p.m.

Mr. P. Williams

Surely the hon. Gentleman realises that the reasons behind the Chandos Committee's Report, in which it states that there must be weekly sailings, is that this matter is parallel with taxis and hackney carriages, which go off the roads to be refuelled. This is presumably on the basis of the carriage of mail. There must be weekly sailings because the mail must go, but, in any case, the mail probably goes by air now, so that that argument falls to the ground.

Mr. Diamond

I quite agree with the hon. Gentleman's argument. The argument which the Chandos Committee allegedly uses is indefensible. I take the view that I do not know of that Report, because I am not allowed to see it. Any Report which is withheld from Members of Parliament, when they are being asked to vote £18 million of public money to be devoted for a certain purpose, is not to be regarded by us at all, if only as a protest against the practice of treating Members of Parliament like children.

I come back to the Minister's comment to the effect that any ship built for the express North Atlantic passenger service is quite unsuitable for other trades, and I turn again to the report in The Times of 25th May on the new liner. It stated that it is to be of 30,000 tons, with room for 400 first-class passengers and 1,100 tourist class, a total of 1,500. The tonnage is 30,000 for this ship, compared with the 75,000 tons for the new "Queen", which will be two-and-a-half times larger. The new "Queen" is to carry approximately 2,200 passengers, against 1,500 in the other case, so that the new "Queen" is to be twice the tonnage but is to carry only half as many passengers again.

Now let us compare the price. The price of this new liner is to be £9 million, and the price is being put up by private enterprise. There is room far private enterprise to do its job and for public enterprise to do its job, but what we are objecting to here is an unfortunate marriage between the two. This private enterprise ship is to cost £9 million, against the £30 million for the new "Queen", which is to carry half as many passengers again. The new "Queen" is to cost about three and a half times the cost of the private enterprise ship, it is two and a half times the tonnage, and yet it carries only 50 per cent. more passengers. This, surely, requires explanation.

What do those who are putting up their own money to run this ship say about it? They are putting up their own money, not the money of their respective Governments, and this is what they say: We examined all sizes up to 70,000 tons, and we rejected the larger ship, because it would be a white elephant for winter cruising, and we think anyone who builds for the North Atlantic in winter is plain crazy. These are not words which I would use in this Chamber; I am only quoting them, but with approval. They conclude: In winter, flying above the clouds is much pleasanter. I repeat that the summary conclusion of the Minister was: Any ship which can operate on the Atlantic express passenger service is bound to be unsuitable for other trades."—[OFFICIAL REPORT, 1st May, 1961; Vol. 639, c. 920.] The second reason why we are right now to lower the figure in the Bill is that it has been demonstrated since the Second Reading that the way to achieve the Government's object in carrying on the North Atlantic express passenger service is to have smaller ships, which can do winter cruising as well, and thus reduce the total cost to about £9 million. The Cunard Company could pay more, and could put even more into Eagle Airways, pay even higher directors' fees and buy even more American aeroplanes, instead of supporting British.

Mr. John Howard (Southampton, Test)

Will the hon. Gentleman tell the Committee at what speed it is estimated this ship can travel during the winter months?

Mr. Diamond

Home Lines did not disclose the speed, but she will probably operate at not less than 24 knots, at a cost of £9 million.

Mr. Callaghan

That is good enough.

Mr. Diamond

If the hon. Gentleman is making the point that at 24 knots the mail will not get through in time if carried by sea, and will have to be carried by air, I accept his point, but I am sure that he is not living in the distant past, as are the members of the Government Front Bench.

The third point is the administrative reason. It is that at present the Government should be the major partner if they are to put up £18 million, and if the Cunard Company is putting up only £12 million. The Government should be the major partner in this partnership between public and private enterprise. It is normal, if there is a partnership of that kind, that the major partner should have major control, a major share in the profits and dividends and have a major voice in management. All these things are the corollary of a major interest in financing the project, but is this the case here? Indeed, it is not.

As the Bill is drawn, there is no control by the Government whatsoever in the day-to-day management of the company and no broad control of the principles. They have no interest whatsoever, and it would have been wholly inappropriate for a tough negotiator like the Minister. I am quoting his own words. When we were discussing the Hyde Park (Underground Parking) Bill, the suggestion was put forward, but was rejected on the ground that it would limit the possibility of tough negotiation by the Minister when he came to deal with private enterprise. I recognise that the Minister can be tough if he wants to be, and I hope that he will be very tough in the negotiations, though it does not look as if he has been very tough up to now. He has not been tough at all.

Mr. Shinwell

The matter is settled.

Mr. Diamond

My right hon. Friend says the matter is settled, but, of course, it is not settled until the agreement is finally made and comes before this House for approval.

I am, therefore, seriously hoping that the Minister will be encouraged by the remarks we are making into seeking to vary the agreement. If we are to have no control, it is quite absurd that we should be the major partner where finance is concerned. If we are to have no interest in the profits, as in this case, it is quite absurd that we should be the major partner in finance. If we are to have no responsibility, and if the arrangement here is that the Cunard Company will have a separate management agreement to carry on the day-today management of the ship, if we are to have no share in the management whatever, it is both absurd and irrational that we should put up the major part of the money as the major partner. These things are illogical, and the Minister is anything but illogical.

The only way in which to make the Government a junior partner in a project of this kind, which would be logical to the Minister's mind, is by providing that the Government will be a partner contributing to the financing of the project appropriately to their share of the profit, responsibilities and dividends. The only way in which the Cunard Company could be the major partner and the Government the minor partner, would be if the Cunard Company were putting up the £18 million and the Government were putting up the £12 million, thereby reducing the figure in the Bill from £18 million to £12 million, as proposed in the Amendment. These are three major reasons why I think that the Government should accept our Amendment.

Mr. W. F. Deedes (Ashford)

I hope that when my right hon. Friend replies to the debate on this Amendment he will take very seriously the remarks, which have been quoted more than once, attributed to Sir John Brocklebank and mentioned in connection with the recent Cunard inquiry, in particular, the word "unwillingness". That is not a word calculated in any way to allay the misgiving which some of us have had about this matter. In the context of Sir John's remarks, which, I am quite sure, have been correctly reported and not unduly misinterpreted, it runs at variance with nearly everything I have understood to be the background of this position.

It is quite true that we have known very little about the background, because we have not been able to see the terms of the Chandos Report, but I, at least, understood—perhaps I got it wrong—that the problem of the Cunard Company was that it had not sufficient funds to do this job. When the word "unwillingness" is used the question which springs to my mind is, who persuaded whom? Was the Cunard Company unwilling to build and have the Government, for perfectly good reasons, been anxious to retain this North Atlantic symbol, or was it the other way about?

One should add some further remarks, at which the right hon. Member for Easington (Mr. Shinwell) stopped just short, about the inquiry. After the remarks of Mr. Bamberg, who said that it would take about twenty-five years properly to amortise the ship, according to the report in The Times he went on to say: It is very difficult to look ahead in the Atlantic market to that extent, whereas the Cunard board can look forward for a period of, say, 10 years, and to that extent they are prepared to take the risk in obtaining a reasonable commercial return on a ship of this kind. That is ten years, I understand, of the twenty-five years which this ship must survive in order to return the money. That is ten twenty-fifths, but in all fairness it must be pointed out that the loan from the Government is to be eighteen-thirtieths. In other words, the loan is not in relation to the risk as described by the Cunard Company itself. I have no doubt that my right hon. Friend will be able to tell us something more about the background of Sir John's remarks. I hope that he will do so because, as things stand, I cannot think of a less satisfactory history between Second Reading and the present point in our proceedings.

Mr. Diamond

Has the hon. Member turned his attention to the logic of his own pretext, that the Government's interest would be two-fifths, and two-fifths of £30 million is £12 million, which is the figure in this Amendment?

Mr. J. Howard

We are considering, not an Amendment to reduce the amount of Government loan by £6 million, but whether or not we should proceed on this proposition at all. I take it that the effect of carrying the Amendment would be to wreck the whole transaction and to put once more into the Cunard's lap the decision on its finances and whether or not it should be prepared to expend the £12 million which it is already putting into the proposition.

This, therefore, is a wrecking Amendment and we must make clear that we are talking about this £6 million loan, not as a gift or a subsidy. We are to pay £12 million which the Cunard Company would put into the "Queen" proposition.

A great deal has been said about Cunard Eagle Airways. It appears from what has been said by hon. and right hon. Members opposite that they are concerned with freezing part of the resources of the Cunard Company so that it will not have funds available to venture into the Atlantic air passenger trade.

The right hon. Member for Vauxhall (Mr. Strauss) referred to the fact that the Cunard Company, through Eagle Airlines, would be competing directly with B.O.A.C. He mentioned about £7½ million of traffic which might move from B.O.A.C. to this new airline company. That may or may not be the case. Only the future can tell whether that forecast is correct. It is clear that whatever company is allowed to compete with B.O.A.C, if any is allowed, B.O.A.C. will face competition from foreign airlines and this would be adding only marginally to that competition.

4.45 p.m.

The two propositions are not connected. We have, on the one hand, the raising of finances for a new liner which is to cost £30 million and to have restricted use. We ought to get back to HANSARD for 1st June, 1960, col. 1440, where my right hon. Friend summarised the Report of the Chandos Committee. In the first paragraph of the summary the following words were used We were asked to consider how the British express… I underline the word "express"— passenger service across the North Atlantic could best be maintained. Those were the terms of reference of the Committee. In paragraph 2, the Committee went on to say: We have consulted shipowners and other interests, as well as Cunard themselves. We have examined several different types and sizes of ships and also various types and patterns of service."—[OFFICIAL REPORT, 1st June, 1960; Vol. 624, c. 1440.] It went on to say that this particular type of ship is the only one which could fulfil the needs of an express passenger service.

If we were not talking now about an express passenger service, there would be a great deal in what the hon. Member for Gloucester (Mr. Diamond) said. He was talking about the ship which would travel at 24 knots. It would be quite impossible to run an express service with a ship of that speed. At present, any number of passenger ships are sailing from Liverpool and plying across the Atlantic, ships of the Cunard and other companies, with passengers who wish to travel at a slower rate. They can use Liverpool, indeed they also use Southampton, but we are considering now whether we can remain in the North Atlantic express passenger trade.

A feature of that trade is that a ship must be able to cross the Atlantic in five days so as to allow for a weekly sailing, that is to say, every week-end at sea and a day at each end to take on and discharge passengers. To cross in five days, the ship must be capable of 29½ or 30 knots. Therefore, a ship with a speed of 24 knots, the class mentioned by the hon. Member, cannot be considered in the context of this Bill.

Mr. Diamond

I am interested in what the hon. Member is saying. My knowledge is not sufficient to say whether 24 knots would be enough to do the return journey in a week, but this journey has to be done in the winter period. If one is interested in speed, one goes by air.

Mr. Howard

I was talking of the express passenger service. Let the Committee be under no misapprehension that hon. Members opposite wish to wreck the Bill.

Mr. Shinwell

No.

Mr. Howard

Of course they do.

Mr. E. G. Willis (Edinburgh, East)

On a point of order, Sir Harry. If this were a wrecking Amendment, would it have been called?

The Temporary Chairman (Sir Harry Legge-Bourke)

It is certainly not for the Chair to decide what intentions hon. Members have in putting down Amendments, but it is for the Chair to decide whether an Amendment is in order, and this Amendment is in order.

Mr. Diamond

This is the second time that the hon. Member for Southampton, Test (Mr. J. Howard) has used the term "wrecking Amendment". If £6 million less is put in by the Government, £6 million more will have to be put in by the Cunard. That is not wrecking. It is as simple as that.

Mr. Howard

I thought that I had made it clear at the outset of my remarks that if at this stage the Cunard Company were asked to put up another £6 million—after the negotiations that the Government have concluded, details of which are enshrined in the documents accompanying the Bill—valuable time would be lost. It is doubtful whether the Cunard Company would be prepared to commit another £6 million to this project. I use the word "commit", because it has been used constantly in connection with the Amendment.

Mr. Shinwell

Is the hon. Gentleman aware that the Cunard Company has this amount? That is admitted. It is contained in the company's balance sheet and it has been admitted by witnesses who appeared before the recent air inquiry. The company has the money all right, and the only point is that the £6 million which it could provide—so that the Government need not provide this £18 million, but only £12 million—would not go to Eagle Airways. Is it not possible for Eagle Airways to raise £6 million in the market at 6¾ per cent. or 8 per cent.? If it is such a sound project, surely the money could be obtained. Why ask the Government to provide it?

Mr. Howard

I am grateful to the right hon. Gentleman for leading me to my next and important point. I have before me the balance sheet to which the right hon. Gentleman referred. In this balance sheet of the Cunard Steam-Ship Company I cannot see another £6 million among its assets.

Mr. Shinwell

I said £16 million.

Mr. Howard

I am talking about £6 million, and I hope that at least the right hon. Gentleman will allow me to come to the end of a sentence concerning the balance sheet. The Cunard Company in its balance sheet of 31st December, 1960—and this is the consolidated balance sheet containing the whole of the assets of the Cunard Group—has investments totalling just over £14 million, and roughly £3 million in cash, the bulk of which, presumably, is cash required for the working of the company.

The point at issue today is that the right hon. Gentleman says that if the Cunard Company were compelled to put another £6 million into this project, the company would not have enough money available for its air project. But the Cunard Company, from its balance sheet, could not put another £6 million into the project. That is the point. It may be suggested that it could do so, perhaps by squeezing its resources, but we are here discussing two different problems. The Cunard Company, in order to finance the ship, would have to raise a mortgage on a ship with a life of 25 to 30 years. Over that period the company would have to get back the whole of the sum advanced by mortgage. In the case of aircraft, on the other hand—for instance, Boeing 707's, and I believe that two of them are concerned—about £6 million is involved and the bulk of that money could be raised by mortgaging the aircraft—a much more realisable asset than a Cunarder.

Therefore, the Cunard Company would be able to face its aircraft commitments and raise £6 million by purchasing two readily saleable assets which would earn the whole of their depreciation in probably 5 to 8 years, as compared with 25 to 30 years in the case of the project under discussion.

Mr. Shinwell

May I once more put the point I have made on several occasions? This is a point which appears in the report of the inquiry. When Sir John was asked whether money was available, he said that there was no inability to find more than £12 million, and he added: It should be 'unwillingness'. The amount to be found was not the crucial point: it was the risk element and the profit element of any unit which had to last 25 years and cost £30 million. In other words, the company has the money but is unable to accept the risk—so it has placed the risk on the Government. The Government are saddled with the risk. If the hon. Gentleman wishes to read the document which I have here, I will gladly give it to him.

Mr. Howard

I am grateful for the right hon. Gentleman's offer. The word "unwillingness" has cropped up in the context of the Cunard Company being unwilling to put more than £12 million into the proposition. I have, pointed out that in the balance sheet there is a little more than £12 million. Hon. Members are today talking about another £6 million, or perhaps the right hon. Gentleman the Member for Easington (Mr. Shinwell) is talking about the total of £30 million? That is a totally different matter—a proposition costing £30 million for a new ship as against a proposition for aircraft—which are readily saleable assets—costing about £6 million. This distinction must be clearly drawn, and I hope that the Committee will reject the Amendment.

Mr. John Rankin (Glasgow, Govan)

In view of what the hon. Gentleman has said, can he say what cash offer was made by the Cunard Company for the takeover of Eagle Airways?

Mr. Howard

I certainly cannot say and I certainly shall not ask my right hon. Friend the Minister to answer that question. No doubt the figure is available in the financial columns of the Press. But we are not considering that matter at the moment. We are considering a £6 million mortgage on aircraft, as against £30 million for a new ship.

Mr. Rankin

rose—

Mr. Howard

I will not give way again to the hon. Gentleman. I thought that I had made it clear that the financing of these two propositions is distinct and separate.

The Cunard Company has been prepared to put up £12 million. Whether or not it is willing or able to contribute more is beside the point, because the whole of the negotiations, presumably involving hard bargaining, ended in the terms of the recommendations in the Paper accompanying the Bill. I therefore urge hon. Members to consider whether or not we require an express passenger service across the Atlantic. I believe that we do, and I therefore hope that hon. Members will vote against the Amendment.

Mr. S. Silverman

The hon. Gentleman the Member for Southampton, Test (Mr. J. Howard), has said that the question whether the Cunard Company could find the whole of the money, or alternatively, could find the extra £6 million which is involved in the Amendment, is beside the point. It may be beside the point now, but it most certainly was not beside the point during the Second Reading debate. As I remember it, that was the case which the Government were making, and the Minister of Transport said at the commencement of his Second Reading speech: The story started two or three years ago, when Cunard told the Government that it could not find enough capital, either from its own resources or by borrowing on the market, to replace the 'Queen Mary' by a ship of the same class at current shipbuilding prices."—[OFFICIAL REPORT, 1st May, 1961; Vol. 693, c. 914.] The hon. Member for Test may be perfectly right in saying that, on the information which we now have, the ability of the Cunard Company to finance it itself is not the point. I think he is right. I think that we have the evidence of the most authoritative and decisive witness to show that he is right, namely. Sir John Brocklebank. But what the hon. Member for Test does not realise is that by saying that, and saying it correctly, he has completely cut the ground from under the feet of the Minister of Transport—unless the Minister is going to invite the Committee today to abide by the decision made during the Second Reading of the Bill—for reasons not merely different from the reasons he then advanced, but for reasons diametrically opposed to those reasons.

I accept the hon. Gentleman's sincerity. I make no criticism of it and no attack on it. Why should I? We have ample authority for the proposition that where a man's treasure is there will his heart be also. There is, therefore, no reason to doubt his complete sincerity in advancing this proposition to the Committee. Nevertheless, I venture to say to him that his speech was ill-advised and tactless in the extreme.

Mr. Burden

Was the hon. Gentleman here during the Second Reading of the Bill? My speech was purely factual and it was not made from a brief provided by the Cunard Company.

5.0 p.m.

Mr. Silverman

I have no intention of being diverted from the point that I was proposing to make. Whether I was here or not has nothing to do with the merits of my argument. If the hon. Gentleman will possess his soul in patience for a minute or two, he will see why.

In every other institution of government in this country except the House of Commons a person in the position of the hon. Gentleman would have been debarred by law from either speaking or—

Mr. Burden

On a point of order. May I ask for your guidance, Sir Harry? Is it not a fact that, if an hon. Member has an interest in the subject under discussion, he should declare that interest, and there is no question of that being, in any way incorrect or proper?

The Temporary Chairman

Before I came into the Chair, I think that the Chairman of Ways and Means gave a Ruling on this matter. First, as I understand it, there is no rule against any hon. Member voting or speaking on any matter of public policy such as is contained in a public Bill, even when that hon. Member may benefit from the passing of the Bill by the House. Secondly, I understand that it is customary for an hon. Member to declare a personal interest in matters before the House, but I gather that the hon. Gentleman did that before I came into the Chair. That also-applies when the House is in Committee. However, it is not for the Chair to enforce these rules. Finally, I understand that it is out of order for an hon. Member to impute dishonourable motives to another hon. Member. The only way in which that can be done is to table a substantive Motion. I gather that the hon. Member for Nelson and Colne (Mr. S. Silverman) is not trying to do that.

Mr. Silverman

This is not in dispute. Those of us who have been Members of the House of Commons for a long time know that an hon. Member, whatever his interest, is entitled to speak and to vote so long as he declares his interest in the matter under consideration. Even that is not a necessity but merely a custom. I have not accused the hon. Gentleman of doing anything wrong. I have doubted the wisdom of what he is doing and his tact in doing it. I am entitled to do this and, subject to your correction, Sir Harry, I shall continue to do it.

What I was dealing with was not what would be proper and right in this Committee but what would be proper and right in any other institution in this country under laws passed by Parliament in a comparable situation. If this had happened in the London County Council, in an urban district council, in a rural council—

Mr. Diamond

Or in Gillingham.

Mr. Silverman

—or in the hon. Gentleman's local authority, he would have been debarred by law from taking part in the debate and from voting, whatever his interest. I am not saying that that ruling is applicable to Members of the House of Commons. Of course it is not. The hon. Gentleman was perfectly within his rights in speaking on the the Second Reading and, if there had been a vote, in voting. What I am saying to him, in all friendliness and with great respect, is that he would have been wiser not to exercise his right. That is the point that I am making. Whatever the hon. Gentleman's rights may be, it is infinitely better in itself and infinitely more conducive to support of the Government's case if arguments in favour of a proposition which cannot fail to be a financial advantage to an hon. Member are left to other hon. Members.

Mr. Burden

The hon. Gentleman is quite wrong about this, and I think that he ought to be put right and that the correction should be put on the record. If the Bill goes through, a company will be formed in which I shall certainly have neither a directorship nor any financial benefit. Equally, I have no financial benefit or interest in the Cunard Steam-Ship Company.

Mr. Silverman

The hon. Gentleman must make up his mind whether he has a financial interest in the proposition or not. He ought to know that. As far as I know, no other hon. Member knows it. If he is now saying, in contradiction of what he has said on every other occasion, that he has no interest in the matter, then I unreservedly withdraw every word that I have said. I am sure that my right hon. Friend the Member for Easington (Mr. Shinwell) will do the same. If, on the other hand, he has a financial interest, then with all respect—

Mr. Burden

rose—

Mr. Silverman

I will not give way. Let me finish my sentence and then the hon. Gentleman can put his foot in it as much as he likes. If, on the other hand, he has a financial interest in the matter, then again I say to him that he would have been much wiser to keep out of it. If the hon. Gentleman wishes to intervene again, I will give way.

Mr. Burden

On every occasion possible when this matter has been debated, and when the hon. Gentleman has not been present, I have made it clear that I have no interest, financial or otherwise, in the Cunard Steam-Ship Company or in any company which may arise out of this Bill, but that I was a director of Eagle Airways before it became a company owned by the Cunard Steam-Ship Company. I still am a director, on exactly the same terms as I was before Cunard took over.

Mr. Silverman

In that case, the hon. Gentleman's speech was even more ill-advised and stupid than we thought it was. He has allowed the Second Reading and the debate on this Amendment to proceed on the basis that he has an interest in the matter which he himself declared. If he had not declared it, this debate would not have arisen. On either proposition, it seems to me that the hon. Gentleman is convicted out of his own mouth of having made a speech which, if he had stopped to consider it, he would not have made.

Mr. P. Williams

Now let us get back to Cunard.

Mr. Silverman

Let us get back to Cunard. I take it that the hon. Member for Gillingham has no further interest in the matter.

The Minister is now under a very clear duty to tell the Committee why he resists the Amendment, if that is the case. Of course, there is one explanation of the Government's attitude to this matter which has nothing to do with its merits, with the financial argument or with the Amendment. I understand that they made a pledge about this in the General Election and that they are so obstinately insistent on carrying it through, in spite of the almost unanimous opposition of both sides of the Committee, because they wish to fulfil their pledges to the electorate.

What is the reason for this belated sensitivity concerning election pledges? Since the Government were elected, they have done a great many things which they were not pledged to do and a number of things which they were pledged not to do. What is the overriding sanctity of this particular incidental pledge? If this is what is inhibiting the Minister of Transport from giving effect to what is the plain logic of the facts, then I think that he will not be adding to the Government's perfidy very much if he renounces this pledge as the Government have renounced so many other pledges which they made in the same election. If the right hon. Gentleman is satisfied that he need not be so punctilious or sanctimonious about this matter, let him come to the facts.

Mr. Diamond

My hon. Friend has used the word "punctilious" about the Government carrying out their election pledges. He will remember that the election pledge was to put up two "Queens". It now turns out that the aim of the Government is to put up one "Queen" only. What they are trying to do is to honour one half of their pledge in a typical Tory fashion.

Mr. Mellish

May I further complicate the matter? That pledge was given by the Prime Minister, and it was clearly understood that the work would be given to Scotland, yet the Minister of Transport has not said that Scotland will build even half of this pledge.

Mr. Silverman

Both of my hon. Friends are a little hard on the Minister. If we have reached the stage when this Government are ready to fulfil 50 per cent. of their pledges, it is an enormous improvement on their record so far. Even if the 50 per cent. is subject to the limitation about which my hon. Friend the Member for Gloucester (Mr. Diamond) has reminded me, perhaps we can give them that by way of discount.

I now turn to the merits of the proposition itself. No doubt a case—not a case which I should accept, but, nevertheless, an arguable, plausible case—can be made for this proposition on the basis that there ought to be such a ship, that the Cunard Company can build it as well or better than anybody else, and that the Cunard—[Interruption.]—if someone else could have it, I do not know why we are doing it this way. Let us assume that this is the best way of doing a thing that it is right to do, which presumably is the Government's case. There is a case for doing it out of public money only if it cannot be done without public money. I do not advance this as a general proposition, because I should like to see the State taking full ownership and control of all services of this kind. I should like to see it providing all the capital, owning all the assets, controlling the management and, in the name and interests of the nation, owning all the proceeds.

However, the Government do not accept that. They hold another view. They hold a view about an occasional and spasmodic partnership with private industry so that essential things can be done by private industry, but where there are financial inhibitions or burdens which it would be unfair to place on private enterprise, because it has not the resources and cannot raise them in the open market, then the Government, in the interests of the community, are entitled to come to its aid and to give it subsidies and lend it money at special rates. That is the Government's case, as I understand it. I concede that it is an arguable case if the facts are right. When the right hon. Gentleman moved the Second Reading, he recommended the Bill, with the £18 million, to the House on that very ground.

Mr. Callaghan

Perhaps the only ground.

5.15 p.m.

Mr. Silverman

I have tried to state fairly—I believe that I have succeeded—the Government's case for the Bill on Second Reading. What I am saying is that, after Sir John Brocklebank's evidence in the other matter, the right hon. Gentleman must recognise that the facts on which he based his argument are not facts at all. There is no such inability. Unless the Minister is to persuade the Cunard Company that it has less resources than the Chairman says it has, the whole basis of his case has gone.

The Amendment does not ask him to withdraw the whole of the loan. It gives the Cunard Company the benefit of any doubt there might be about 100 per cent., but it accepts Sir John Brocklebank's evidence and, on the basis of his evidence—or, rather, on the basis of half the facts disclosed by his evidence—£6 million instead of £12 million—it is said that it is now established that the need that the Government have set out to satisfy is not a need for £18 million but a need, at the best, for not more than £12 million. If Sir John Brocklebank's evidence does not mean that, it is extremely difficult to know what it does mean.

I should like to know from the Minister whether he accepts Sir John Brocklebank's evidence as given at that inquiry. If the answer is "No," we should adjourn this debate altogether and have another inquiry to see what the Cunard resources really are—

Mr. Diamond

And not publish the result.

Mr. Silverman

I should like the result to be published, because it is on the basis of those facts that we are being invited to adopt this—

Mr. Diamond

If my hon. Friend will permit me, we are being asked to accept the Bill on the basis of the Chandos Report, and we have not got that Report.

Mr. Silverman

I know that we have not got it. A great many people seem to know what is in the Report, but I have not yet met anyone who claims to have seen it.

It is for that reason that I say that if the Minister of Transport is not prepared to accept the evidence of the chairman of the Cunard Company as to what the financial resources of that company are, if he is satisfied that its resources are much less than the company says they are—

Mr. Mellish

We keep talking about the Chandos Committee, but we do not know about the evidence given to it. It has never been published. Nevertheless, the Committee's main conclusions were published, and the Committee itself said that the Cunard Company had said that it had available only £12 million from its own resources. It was on the basis of what the Cunard Company told the Committee that the Committee made recommendations which we now know not to be accurate.

Mr. Silverman

This part of the discussion may, in a sense, be academic, because I do not expect the Minister of Transport to answer in the negative the question I have asked of him. I do not think that at the end of this debate we will be told that when Sir John Brocklebank says that his company is able to provide the money but is unwilling to do so, the Minister does not believe him. For that reason I believe that the right hon. Gentleman must, if he ventures to answer the question at all, answer it in the affirmative—say that he does believe what Sir John Brocklebank said.

On the other hand, if he believes what Sir John Brocklebank said, what possible reason can there be for rejecting this Amendment which, as I have just been reminded, was based precisely on the acceptance of Sir John Brocklebank's evidence? If the Minister persists in rejecting the Amendment and forcing the extra £6 million down the throat of the Cunard Company, in the teeth of its own assurance that it does not need it and can itself provide the money, this is really to make a mockery of the whole of these proceedings and of the Bill itself.

And this from a Government who have always made one of their principal interests the protection of the taxpayer and the public from the wastage of public money. During the election they made a violent, extravagant, inflated and thoroughly unfair attack on my right hon. Friends as being wasters; the people who poured public money down the drain, the people who spent it without care or reckoning, the people who threw it away.

All right—we threw it away on education, we threw it away on health, we threw it away on housing, and we threw it away on a great many other things where it was obviously necessary that something should be done. And if the right hon. Gentleman rejects this Amendment he will be throwing public money away on the Cunard Company in the teeth of its own evidence that it does not require the money. I should have thought that the right hon. Gentleman would have shortened the debate long ago by saying that he accepted the Amendment.

The Joint Parliamentary Secretary to the Ministry of Transport (Vice-Admiral John Hughes Hallett)

It might be for the convenience of the Committee, Sir Harry, if I were to intervene now. There will be plenty of time for those right hon. and hon. Members who wish to intervene later—

Mr. Rankin

On a point of order, Sir Harry. The Parliamentary Secretary has just made a declaration that we have plenty of time. Does he mean that? Do the Government mean that?

The Temporary Chairman

I thought that the hon. Member was rising on a point of order but I understand him now to be addressing a question to the hon. and gallant Member. If it is a point of order, perhaps the hon. Gentleman will address it to me; if it is not, perhaps he will seek to interrupt the hon. and gallant Member.

Mr. Rankin

I am sorry. Sir Harry. I understand that this part of our business is timed to stop at 7 o'clock. The Parliamentary Secretary has just said that we have plenty of time. Could we have that statement explained? Is it the Government's intention to provide that time?

The Temporary Chairman

That is not a point of order but, certainly, business will be interrupted at 7 o'clock by Private Business.

Vice-Admiral Hughes Hallett

It is not for me to forecast the duration of these proceedings. The hope was certainly expressed by my right hon. Friend the Leader of the House that we might have the Bill by 7 o'clock but, at the present rate of progress, it looks rather unlikely that we shall.

Perhaps you will allow me, Sir Harry, to go a little outside the rules of order so that I may thank hon. Members on both sides for their kind expressions of good will on my appointment during the Second Reading debate. I had to sit in silence then, but I shall do my best to deserve their confidence, although I fear that I shall dissipate it all before the afternoon gets much later.

The hon. Member for Gloucester (Mr. Diamond), among three reasons that he had advanced in support of the Amendment, put forward one in a form slightly different from any advanced by any other hon. Gentlemen who have supported the Amendment. He said that it would compel the Cunard to build a smaller ship, which he thought would be adequate. To a large extent, that has been answered by my hon. Friend the Member for Southampton, Test (Mr. J. Howard), and all I would add to the point about the speed of the big ship on the North Atlantic express service is that the essence of the service has always been accepted to be the fact that it is an all-the-year-round service. It may be true that one line thinks it folly to run a service in the winter, but that has not been the view of the Cunard line, or that of the American line that operates the "United States" or of the Compagnie Générate Transatlantique in regard to the "France".

As the right hon. Member for Vauxhall (Mr. Strauss) said in opening, this Amendment would reduce from £18 million to £12 million the total advances that the Minister is empowered under the Bill to make to the company. In so doing, of course, it would conflict with one of the basic recommendations of the Chandos Committee—and I may say that those recommendations have been published in HANSARD—and would almost certainly make the whole object of the Bill unattainable. The agreement reached with the Cunard Company is clearly set out in the White Paper, and the basis of that agreement would be destroyed by making this big fall in the level of the loan. To that extent I have some sympathy with the view expressed by my hon. Friend the Member for Southampton, Test that if the Amendment were carried it would, in practice, wreck the Bill.

The point behind the Amendment, as has been made very clear, is that the Cunard Company, the steamship company, ought to add to its £12 million contribution towards the "Q/"—if I may so call her—the capital which Cunard Eagle intends to find for the purchase of Boeing aircraft. That is really the suggestion that has been made throughout the debate. I may say, in passing, that it has been explained, both on Second Reading and in the White Paper that the company is not prepared to risk, if we may call it that, more than £12 million of its shareholders' money on this project—

Mr. S. Silverman

rose—

Vice-Admiral Hughes Hallett

If I ay complete this argument, I shall be much obliged. I hope to answer all the hon. Gentleman's points, but this is an intricate subject and, if the hon. Gentleman will allow me, I would rather go through it in my own way. I shall give way in due course.

Even if the company wanted to do more, it could find the additional money only by mortgaging the other assets of the group. That, of course, would increase its risk to what it has regarded as an unacceptable degree. On the other hand, the capital required for the Boeings, which are altogether a different venture, can be raised without resort to this sort of means.

The right hon. Member for Vauxhall referred to the Government's opinion that the "Q3" venture was commercially justifiable. That is so, but I put it to him that it is not quite the same thing for something to be commercially justifiable and to be so commercially attractive as to attract millions of pounds from the private money market. I do not know, but I imagine that the £6 million required for the aircraft will have to be raised on that market.

Perhaps I may be permitted to give the Committee some figures concerning the capital investment position of the Cunard Steamship group which show how the opinion was reached that £12 million was a reasonable amount for the company to put up—

Sir Arthur Vere Harvey (Macclesfield)

Is my hon. and gallant Friend aware that the American aircraft industry today is prepared to advance up to 80 per cent. in loan form, over a good many years, unfortunately against our own industry? That is the position.

Vice-Admiral Hughes Hallett

That strengthens the point I made; the comparative ease of raising money for the aircraft as compared with the ship.

The Cunard Company has made available to my right hon. Friend a number of figures that I think are pertinent to this debate, and I should like to quote them. First of all, purely as a matter of interest, during the fifteen years that have elapsed since the war the total expenditure on new tonnage by the group has been nearly £80 million. On top of that, it has spent just over £6 million of capital expenditure in modernising and improving its existing ships. It has obtained about £3½ million by the sale of old ships. That means that the company has raised some £83 million of which £38 million were raised and provided by the company itself. I do not say that the company is unique in that, but I thought that I would try to put the matter in perspective for the Committee.

The company estimates that to maintain its fleet over the next ten years—including the £12 million which it is proposing to put into the "Q3"—it will require £61 million; £15 million for Brocklebank, £24 million for the Port Line, and £22 million for the Cunard Line.

The resources to which it looks for providing that money are, first of all, the group investment—to which reference has already been made—of £14 million, to which it adds the depreciation that will be suitable during the next ten years—estimated at £40 million—to which it adds a further £2 million that it expects to raise from scrapping old ships. That leaves a balance of £5 million that will have to be found by setting aside profits in excess of depreciation to raise the £12 million. All that, of course, is without making any provision at all for the replacement of the "Queen Elizabeth".

5.30 p.m.

Mr. Willey

Will the Parliamentary Secretary be frank with the Committee and tell it what discussions have taken place between the Cunard group and the Government about the purchase of the Boeings, for these two reasons? The hon. and gallant Gentleman talks about the attractiveness of the proposition—the "Q/"—but the attractiveness of this proposition by itself is affected by the purchase of two Boeings for the trans-Atlantic route by Cunard Eagle. The attractiveness of the "Q/" is obviously affected by that.

The other reason is this. The hon. and gallant Gentleman talks about the resources of this group, but he says nothing at all about the Boeings. We want to know what resources were used for the purchase of these Boeings. The company purchased the Boeings without waiting for the licence. One wants to know what resources were used for the Boeings. Surely this is a fair and proper question to put to the hon. and gallant Gentleman.

Vice-Admiral Hughes Hallett

This is the fundamental point of difference between the two sides of the Committee. We do not accept that there is this close connection between the two matters. There have, in fact, been no discussions, as far as I know, between the Government and the airline with regard to the purchase of the Boeings. If the hon. Gentleman is correct in saying that they have already been purchased, possibly the explanation can be found in what my hon. Friend said about the very generous credit terms advanced.

Mr. Rankin

Is the hon. and gallant Gentleman telling the Committee—he ought to be perfectly clear upon this point—that the Cunard Company does not own Eagle Airways? The holdings and also the aviation company are now part and parcel of the Cunard Company.

Vice-Admiral Hughes Hallett

I did not say anything about that at all. I said that this problem is a separate problem and that we regard it as such. Of course, that point of view accounts for the large number of hon. Members, including my hon. Friend the Member for Ashford (Mr. Deedes) and my hon. Friend the Member for Sunderland, South (Mr. P. Williams), who drew attention to the apparent discrepancy between the evidence as reported in The Times by Sir John Brocklebank with regard to the alleged unwillingness as opposed to inability to raise more than £12 million. I would suggest that the conflict between these two statements—

Mr. S. Silverman

May I ask the hon. and gallant Gentleman—

Vice-Admiral Hughes Hallett

I cannot give way to the hon. Gentleman. I must be allowed to go on.

Mr. Silverman

rose—

The Temporary Chairman (Mr. Malcolm MacPherson)

The hon. Member must resume his seat if the Minister does not give way.

Vice-Admiral Hughes Hallett

I think that I have been very good about giving way, and perhaps the hon. Gentleman will listen—

Mr. Silverman

The hon. and gallant Gentleman gave way on other points.

The Temporary Chairman

Order. I hope that the hon. Member will not, in effect, dispute my Rulings from a sedentary position after they have been given.

Mr. Silverman

I think that I have been treated with discourtesy.

Hon. Members

Withdraw.

The Temporary Chairman

Order. Vice-Admiral Hughes Hallett.

Vice-Admiral Hughes Hallett

If I may be allowed to proceed with this rather complicated matter, I would point out that there is, of course, no doubt that the Cunard Company could have raised more than the £12 million from its own resources had it been prepared to use money set aside for the replacement of other units in the fleet. Obviously, I suppose, a good deal more still could have been raised from the market if the company had been prepared to pledge all its North Atlantic assets.

Mr. Shinwell

Where did the company say that?

Vice-Admiral Hughes Hallett

I am giving my opinion to the right hon. Gentleman. He can take it or not as he likes.

The company could have raised even more, I suppose, if it had been prepared to pledge the assets of the subsidiary companies of the group. But £12 million was all that the company had available from its resources for this enterprise, taking into account the total funds at its disposal, its replacement commitments on the rest of its fleet and its assessment of the risks and potential profits of the enterprise. On the advice of the Chandos Committee, the Government accepted that £12 million was as much as the company could reasonably be asked to contribute towards the capital cost of replacing the "Queen Mary".

Mr. S. Silverman

I thank the hon. and gallant Gentleman for giving way. I am sorry if I was rude; I did not intend to be. The hon. and gallant Gentleman must realise that the explanation which he is now giving is not the explanation which the Minister of Transport gave on Second Reading. Not a word of this was in the Minister's speech. Are we not entitled to know on what authority, if the hon. and gallant Gentleman is right, the Minister of Transport made that speech?

Mr. Strauss

May I amplify the question which my hon. Friend has put? The Parliamentary Secretary told us that it might have been possible for the Cunard Company to raise additional money if it had mortgaged its fleet and if it had used money which it wanted for other purposes. But the Minister of Transport told us that the company could not. In his speech the Minister said: Therefore, the previous Administration made two decisions. First, that this unique British service should not be allowed to die out because Cunard could not itself raise all the capital."—[OFFICIAL REPORT, 1st May, 1961; Vol. 639, c. 915.] We were all impressed by that and believed that the Minister meant what he said, that it was impossible for the company to do so. Now we are told a quite different story, that it could have done so if it had wanted to. Which is the true story?

Vice-Admiral Hughes Hallett

I see no conflict between the two statements at all. The question is what the company could have done with normal prudence towards its shareholders, to whom it has a responsibility, the rest of the fleet, its employees and ail the rest. I submit to the Committee that this question has nothing whatever to do with whether the company can or cannot raise the money with which to buy the aircraft. There really is no connection at all between the Boeings and the new "Queen". It has already been pointed out that the Boeings earn their depreciation in five years whereas it takes a ship some twenty-five years before it can repay its capital cost. What is more—this point was made by one of my hon. Friends—Boeing aircraft could, if necessary, be used on other routes. That means that they can, if necessary, be sold at any time at probably very little less than their written down value. In short, the investing of £6 million with which to buy two Boeings is a wholly different proposition from investing £30 million in a new Queen.

Mr. Diamond

Will the hon. and gallant Gentleman allow me—

Vice-Admiral Hughes Hallett

I would ask, if I may, to be allowed to finish. I have given way a great deal, and I hope that the hon. Gentleman will forgive me if I do not give way to him now. [HON. MEMBERS: "Give way."] The right hon. Member for—

Mr. P. Williams

On a point of order. Although I do not appreciate the Government case on this matter I should like to be allowed to hear it. It would help if there were not so many interruptions by hon. Members while sitting down. Is there no way, Mr. MacPherson, in which critics on this side of the Committee can hear the Government case?

The Temporary Chairman

I think that there is some substance in the point, but I did not think that the situation was bad enough for me to intervene.

Mr. Shinwell

rose—

Vice-Admiral Hughes Hallett

Perhaps the right hon. Gentleman will allow me, first, to reply to one or two points which he himself made. He said that he was going to put a fundamental question to the Committee. He did not put it immediately because there was a slight argument about the position of my hon. Friend the Member for Gillingham (Mr. Burden), but, later, the right hon. Gentleman put what, I think, was the fundamental question that he had in mind. He asked why we were not helping other shipping lines as well. The short answer to that question is because at the present moment none of them is in a similar position.

Mr. Willey

What does that mean?

Vice-Admiral Hughes Hallett

It means that there is no other service at the moment which is faced with such tremendous subsidised competition.

The right hon. Member for Easington (Mr. Shinwell) made a great point about the risk to which public money was being put. I concede at once that some degree of risk is involved in any investment. In this case Government help is considered to be needed. May I have the attention of the hon. Member for Cardiff South-East (Mr. Callaghan)?

Mr. Callaghan

I apologise to the Minister. I did not intend him to hear my remarks. As apparently he heard them, let me repeat that I have never heard the case against building the new "Q/" put more strongly than he is putting it now.

Vice-Admiral Hughes Hallett

That is a matter of opinion.

Some degree of risk is involved. That is inevitable in any investment. I am pointing out that the Government are seeking by their help to reduce that risk by means of a loan and a small grant. The position in this respect is exactly similar to that in 1934 when precisely the same fears were expressed about the profitability of the "Queen Mary". In that respect the position is identical. The same fears were expressed, but the venture proved a success.

The alternative to giving this help now, which was outlined on Second Reading and which I cannot repeat and remain in order, is to let this service go by default. That is the alternative which confronts the Committee, and it is because we do not wish to let the service go by default that I ask the Committee to reject the Amendment.

Mr. Mellish

I wish it clearly to be understood that my intervention should by no means curtail the debate on this Amendment. I am glad that the Patronage Secretary has been here for some time, because he now knows that there are very strong feelings on the subject. Indeed, I doubt whether we shall conclude the debate on the first Amendment by 7 p.m.

Mr. Rankin

Why?

Mr. Mellish

I said that we should not finish it by 7 p.m. I wish my hon. Friend would listen.

Mr. Rankin

I am listening to the best of my ability. Will my hon. Friend please speak up so that we can hear him.

Mr. Mellish

I cannot speak Scots and Cockney at the same time, although I will do my best.

Although we have heard a part-reply from the Joint Parliamentary Secretary, it is obvious that the debate will demand a much fuller explanation from the Minister of Transport himself, because so many of our troubles this afternoon arise from his Second Reading speech.

In many ways we are very sorry for the Joint Parliamentary Secretary. His is a new appointment, and it was his maiden speech. I think that he did it extremely well, but he had a rotten case. He did the best that he could. I feel very sorry for him. His task is to look after the shipping industry of Britain, and if this is the way in which he will look after it, then I am afraid for the future. All the soft words which he uses will not avail if he is trying to defend the indefensible. I tell him at once that he will find a great many enemies where he used to have friends.

What is the issue involved? It is based on the Report made by the Chandos Committee. I will quote from the only Report which is available to us from the Committee which gives any hint or guide. If hon. Members refer to HANSARD of 1st May, 1961, when the main recommendations of the Chandos Committee were published, they will find it made clear that the Committee consulted many shipowners and other interests as well as the Cunard Company. We have reason to believe that those other shipowners told the Chandos Committee that this whole venture was bad from the word "go". Is it true that the Committee was advised that it was not right to go on with it? Was not the Chandos Committee told that this would be money wasted but because of the terms of reference applied by the Government the Chandos Committee had no alternative but to come to the sort of arrangement which we are discussing today?

Sir James Henderson-Stewart (Fife, East)

Where is the evidence for that?

5.45 p.m.

Mr. Mellish

The hon. Member has been out of office for some time. Let him read it and find out the best he can from the recommendations.

Other shipowners regarded this line as very suspect economically. Many of us hold the view—I certainly hold it—that the only reason that the Bill was introduced was one of prestige, and that that is why we are asked to find millions of pounds of taxpayers' money. Some hon. Members are interested because they hope that this will bring work to certain shipyards, but if money is to be found for the shipyards, this is not the way to find it. There are many other ways. If millions of pounds of public money are to be found, it should not be for building a ship for prestige reasons. Certainly, the taxpayers, and, I think, the Government, would like to feel that the money was spent wisely and well.

Mr. J. Howard

rose—

Mr. Mellish

The hon. Member is from Southampton, is he not?

Mr. Howard

I have the privilege of representing part of Southampton, and I have a constituency interest. But I also have an interest because, in common with many other people, I wish to see Britain maintain her position in the North Atlantic trade. Is the hon. Member saying that we should not remain in the express passenger trade in the North Atlantic? Do he and his party wish to throw out the Bill? Will he make it clear at this juncture, because it will save a lot of trouble?

Mr. Mellish

I will make it clear. I think that we should remain in the North Atlantic trade but not in a ship of this size or of this class. I believe that we could get far better value for money, although at least the hon. Member is honest about it; understandably, he wants a "Queen Mary" because it would use Southampton, and Southampton alone, and his constituency would do a great deal of business out of embarkation and disembarkation. I understand that. But I do not see why the rest of the taxpayers should subsidise Southampton alone, nor do I see why they should help to swell the profits of the hon. Member for Gillingham (Mr. Burden).

Mr. Howard

It is not a question of subsidising my profits or the profits of the town. The port of Southampton will be used whichever ship is built which wishes to sail across the Atlantic in five days. The whole point is whether we wish to remain in the express passenger trade.

Mr. Mellish

My answer is, "Yes, we do". The Southampton dockers vote labour and are members of my union, and I hasten to put it on record that I think that Southampton is a very fine port and that its people are very fine people.

Mr. Callaghan

My hon. Friend is on a winner.

Mr. Mellish

I hope that I can do it on the Derby tomorrow.

The second point which I want to make is that the only evidence available from the Chandos Committee is that in which the Committee says that the Cunard Company would subscribe £12 million of equity capital and that it was the only money which the Committee had available for this purpose. This is the whole of our argument. When we had the debate on Second Reading this was the Minister's case, and that is why we are determined that later in the debate he should answer some of the pertinent questions which have been put by my hon. and right hon. Friends.

Mr. Howard

I am sure that the hon. Member does not wish to mislead the Committee. Is he quoting from column 1441 of HANSARD of 1st June, 1960?

Mr. Callaghan

It is column 914 of 1st May, 1961.

Mr. Mellish

My "Parliamentary Private Secretary" informs me that it is column 914. The Minister made it perfectly clear that Cunard could not find enough capital either from the Company's own resources or from borrowing on the market.

Mr. Howard

I thought that the hon. Member was quoting from the report in HANSARD on the findings of the Chandos Committee. If he quotes correctly he will see that it says that Cunard had available only £12 million from their own resources to invest in the project.

Mr. Mellish

I do not think that I shall give way to the hon. Member again, because it will not be worth while. If he intends to quote the Minister of Transport he is in the same difficulty as myself. I have followed the Minister of Transport in many debates. He is a very wily customer. I am glad that in the Bill we did not give the project to Marples-Ridgeway for that firm to build. We might well have had that.

It is difficult to follow the Minister's argument. The point is that we were led to believe that this Government subsidy was inevitable because Cunard, who, apparently, were the only people who could possibly build this big ship, could not themselves find the resources. That was the main burden of the Government's case. Hon. Members opposite bitterly opposed this ship being built at all, or being built by Cunard. Some of them opposed the Cunard Company being given the job. They said that there were various reasons why the ship should not be built.

Our problem on this side of the Committee has always been that we did not want it to go from the House to the country that we were against Government money being spent on anything in the shipbuilding industry. I should make it clear that on re-examination I, for one, believe that in many ways the Bill should be opposed totally. I believe it to be wrong to spend the money on a ship of this kind, which, in my view, will not do for the nation all the great things which have been suggested for it and which, in the long term, will not bring all the work which this money could bring if it were spread over.

We had a debate last Friday week on the economic plight of Northern Ireland. The attendance in the House was shameful. That debate told the saddest story which one could ever hear of the shipbuilding industry there. If it does not get an order soon it will have over 50 per cent. of the people out of work and without a hope of getting a job. The last thing we want to do is to convey the impression that we do not want money spent in the industry. But we want it spent wisely and well.

If this liner is given not to Northern Ireland, but in such a way as to satisfy my hon. Friends from Scotland, who fight for their interests as well as anyone in the House, then it will be a disaster for such places as Northern Ireland, because there is nothing to follow it. There is no plan. There is just one ship. There is one prestige ship to be built because the Prime Minister gave a promise during the General Election. We believe that the Cunard Company could find this money.

The Temporary Chairman

Order.

Mr. Mellish

I am coming to the Amendment.

We believe that the Cunard Company can find this money, and that is why we have moved the Amendment. If hon. Members opposite object to the ship being built at all or if they think that the Cunard Company should not build it, they should come into the Lobby with us. On the last occasion we heard speeches from them which were clearly opposed to the Bill. There was no Division on that occasion. They had no opportunity to challenge the Bill.

Mr. John Rodgers (Sevenoaks)

Why did not hon. Members opposite divide the House?

Mr. Mellish

I gave the reasons earlier. This time we shall divide the Committee unless we have an assurance that the Amendment will be accepted. I hope that all those who spoke against the Bill will be in the Lobby with us because the only test of sincerity is where they vote at the end of the day.

Several hon. Members

rose—

The Temporary Chairman

Mr. Marples.

The Minister of Transport (Mr. Ernest Marples)

rose—

Hon. Members

No.

Mr. Marples

I thought that it might be convenient for the Committee if I gave my views now, but I am prepared to speak later if that meets the wishes of the Committee.

Mr. Callaghan

On a point of order. We have had two Front Bench speeches in succession, and this would make a third. We therefore wonder whether the Minister intends to conclude the debate. He—not the Chair—may have made arrangements with the Patronage Secretary for the Closure to be moved afterwards. I should like to know from him—

The Temporary Chairman

Order. The hon. Member may not learn anything from the Minister on a point of order. Before I called the Minister I was on the point of calling another back bench Member. If the Minister does not intend to continue at this stage, I will call Sir John Barlow.

Mr. Callaghan

If the hon. Member for Middleton and Prestwich (Sir J. Barlow) will permit me, I should like to ask the Minister a question. If the Minister speaks next, is it then his intention to call for an end to the debate, or will it be allowed to continue after we have heard his arguments, so that we can discuss it a little more?

Sir John Barlow (Middleton and Prestwich)

I know that the occupants of the Chair have been indulgent and have allowed the debate on the Amendment to go rather wide. I will try to be brief, because I know that you wish to draw this discussion to a close—

Mr. Willey

On a point of order. On what authority does the hon. Member say that it is your intention shortly to bring the debate to a close, Mr. MacPherson? Our understanding is that the debate will continue for some time.

The Temporary Chairman

There is no substantial point of order there. However, to clear up any misapprehension, I have no such intention.

Sir J. Barlow

It seems to me that the effect of the Amendment would be to prevent the building of this Cunarder. That is the object of the Opposition. A great deal has been said about the declaring of interests and I hasten to declare my minute interest in shipping. I have used ships for travelling and considerably for freight for a great many years, and in my very young days I was a skilled riveter and caulker in a shipyard.

There are two vital questions to be faced. They have both been mentioned in the debate. On this side of the Committee, there was the pledge given at the General Election that this ship should be built. I interpret this to mean that approximately this amount of money should be spent for the benefit of shipbuilding and of British shipping in general. We know the difficulty of subsidised foreign shipping and the great problems which the shipowners have had to face during the last few years.

It may be slightly different from the actual promise given at the General Election, but I would think it is fair interpretation that the money could be much better used spread more widely over more shipyards and smaller ships, so that the whole of our shipping industry would benefit materially. For that reason, I do not feel bound by any election pledge.

The next question is whether the scheme is a sound commercial enterprise. My hon. and gallant Friend the Joint Parliamentary Secretary said that the problems and the reasons for building the new "Queen" were similar to those which existed thirty years ago, when the existing two ships were built. I question that. The conditions at that time were entirely different. We all remember only too well the great amount of unemployment which we wanted to reduce. Thirty years have passed. Things are very different today from what they were then. Nobody seriously foresaw the flying of the Atlantic by the vast number of present-day passengers. I do not think that on further reflection my hon. and gallant Friend would agree that conditions are similar today to when the "Q/" and the "Q/" were considered, thirty or thirty-five years ago.

In the whole of these discussions, far too little information has been given to us. I am critical of the method of the creation and the reporting, or non-reporting, of the Chandos Committee. We in the House of Commons have a great regard for Lord Chandos. Many of us knew him very well and had a great respect for his ability. The way in which that Committee was set up, however, the terms of reference which it was given, the members comprising the Committee and the absence of publication do not fill me with confidence.

6.0 p.m.

I also think that the need for this vast ship has not been substantiated. We are told that a 75,000-ton ship is required to ride three great Atlantic rollers and not to pitch or toss and roll at the same time. I cannot believe that that merit carries the same weight now as it did thirty or forty years ago. I believe that smaller and fairly fast ships could do this work equally well. If we wish to spend £12 million or £18 million on helping shipping, we could usefully use it much better elsewhere.

I am glad to see that I am not alone in holding these views. In reading The Times today, I see that that newspaper states that when the North Atlantic Shipping Bill—the legal instrument of this piece of Government folly—comes before the Committee of the whole House of Commons today it should be killed. In the circumstances, I do not think that we are bound by our election pledge to spend the money on one ship and I do not think that anybody would criticise us for spending it in the way I have suggested. I do not believe that on Second Reading and today the Government have substantiated sound reasons for spending this money in the way in which they have proposed.

Mr. Rankin

Like many of his hon. Friends, the hon. Baronet the Member for Middleton and Prestwich (Sir J. Barlow) has come forward to criticise the Bill and, if I followed him correctly, to refuse it his support and to quote The Times of today, which suggests that the Bill should be killed and that now is the opportunity to do so.

As a Member representing one of the greatest shipbuilding areas of the United Kingdom, I gave my support to the Bill on Second Reading and I still stand by that support. If, however, the Minister, when he replies, tells us that he has heard sufficient from both sides of the Committee to convince him that there is a case for taking back the Bill, I shall support him, because consistently in the House of Commons I have for a long while advocated another policy. It is crudely put as "Scrap and build".

That is a policy which would make itself felt throughout the whole of the United Kingdom and be of assistance not only to the nation in the competitive sense in the express services of which we have heard so much, but also from the viewpoint of helping to solve unemployment. If we now get such a contrary proposal as suggested by the hon. Baronet, I shall consider it carefully.

The hon. Baronet referred to the speech of his hon. and gallant Friend the Joint Parliamentary Secretary. With my hon. Friend the Member for Bermondsey (Mr. Mellish), I congratulate the Joint Parliamentary Secretary on his speech, which was made in difficult circumstances. It justified one point that we have been making. The hon. and gallant Gentleman supplied us with a great deal of statistics, which are difficult to follow "off the cuff". This justifies the claim that we have been making today that we should have had more information before the project was considered on Second Reading.

Mr. Shinwell

It was incorrect then.

Mr. Rankin

I shall not deal with that aspect at the moment—

Mr. Shinwell

There is no reason why the House of Commons should allow itself to be misled. We were told by hon. Members opposite, including the hon. Member for Southampton, Test (Mr. J. Howard), that the only reserves of the Cunard shipping group were £14 million. We have also been told that, because of the group situation, it does not have sufficient money to replace its vessels. Let us get the facts as stated at the recent inquiry. What did Mr. Bamberg say in reply to Mr. Fisher? He agreed that £16 million in the Cunard Company's balance sheet was shown as reserves for capital ship replacement and general contingency reserves. As I pointed out on Second Reading, from the actual balance sheet, in addition to £16 million for capital ship replacement, the group had investments of £15 million. These are the facts and the Committee should know of them.

Mr. Rankin

I appreciate what my right hon. Friend has said, but I was not pursuing the question of the rectitude of the financial statistics which have been given to us. We are in Committee and I am certain that my right hon. Friend the Member for Easington (Mr. Shinwell) will not allow the Joint Parliamentary Secretary to escape along the route that he sought.

I rather wanted to deal with another aspect of the hon. and gallant Gentleman's statement, when he said that the Boeing purchase afforded us no link with Cunard. I dispute that completely. That is the point to which I was coming when my right hon. Friend the Member for Easington intervened. The Joint Parliamentary Secretary said that there was no link between the Boeing purchases and the building of the new ship. I dispute that completely. I dispute, also, that the Amendment is a wrecking Amendment, as the Joint Parliamentary Secretary described it. It is nothing of the kind. If there was £6 million to purchase Boeings, there was £6 million to make up the reduction which we propose today.

Further than that, however, there is the whole question of the link between Eagle Aircraft and Cunard. The paid fuglemen of the Eagle Aircraft Company, which is now non-existent, are fighting for the retention of the figure of £18 million because they want the £6 million for use against the nationalised British Overseas Airways Corporation. That is why I hope that hon. Members opposite who are taking, perhaps, a slightly different view on that aspect of our case will, nevertheless, following what they themselves have said about the Bill, come with us into the Division Lobby.

It should be noted that the right hon. Gentleman, in his speech on Second Reading, a speech which has aroused so much attention today, said that this story which has been unfolded today was not something new. He said it had been going on for two or three years. In other words, it was a fairly old story.

Within those two or three years, when the Cunard Company was more or less in touch with, if not approaching the Government to say, "We would like to build a ship of this quality but we have not the money. We must have help if we are to do it," we were told that other moves were going on, because no later than March, 1960, the Cunard Company intimated a desire to acquire a controlling interest in Eagle Airways and associated companies—just a year ago. So that, within the period of two or three years, Cunard was seeking to expand its interests and to take up the business of flying aircraft.

It was only on 22nd March last year that this was accomplished, and it is worth noting that at that point the sole shareholder and owner of Eagle Airways was Mr. Harold Bamberg. One individual was the shareholder. The same individual was the owner. I gather from what the hon. Gentleman the Member for Gillingham (Mr. Burden) said earlier that he had been a director of Eagle Airways for some time. On 22nd March last year there was one owner and one director.

Mr. Shinwell

Ask him how long.

Mr. Rankin

We are in Committee and the hon. Member can still come in.

So the cash offer was made, but because this was a private company there was no knowledge of the value of its capital, but I am told that the value of the cash offer which was made by Cunard to get a 60 per cent. controlling interest in this aircraft company was not disclosed, and that is my reply to the hon. Gentleman the Member for Southampton, Test, sitting next to the hon. Member for Gillingham. Well, this is a test, because I asked him earlier if he would tell the Committee how much Cunard offered for this interest in Eagle Airways, and his answer was that I could have got that from the Press; but it was not disclosed, and I challenge him now to deny that Cunard paid £1 million. While the company was starting to beg from the Government it paid Eagle Airways £1 million.

Sir A. V. Harvey

Who told the hon. Member that?

Mr. Rankin

Ah, I am making a challenge. I have it here in writing. We are now coming to get the figures which the hon. Member for Southampton, Test could not give us. He said it was in the Press. It was never published. It was never disclosed, to my knowledge.

Mr. J. Howard

We are confusing the figures enormously. It has been published. If the hon. Member will look at the balance sheet of Cunard—it is available at Somerset House, though I know that some hon. Members have difficulty in associating the figures—he will see aircraft in the balance sheet cost, less depreciation, £1,030,600.

Mr. Shinwell

That is not what Mr. Bamberg says. Mr. Bamberg was asked by Mr. Fisher: Your company is standing behind the applicants in the purchase of Boeing aircraft at a price of £6 million. If you had not to account for that operation you would have had that money available for the replacement of ships? Mr. Bamberg replied: Those are the resources of Cunard either to provide the cash or by the way of raising finance to find the £6 million involved in this Boeing purchase.

Mr. Rankin

Yes. I think that I still have the eye of the Chair. I think that a little confusion is now emerging. I am dealing with the take-over price of Eagle Airways and my right hon. Friend is dealing with the Boeing purchase price. Add the two together, however, and there was £7 million lying around.

I am glad that I have energised the hon. Member for Southampton, Test, because when I asked him a little earlier in the afternoon what the figure was he did not know it. It is well to keep in close touch with the director of Eagle Airways beside him, who has obviously supplied him with the figure since I made my intervention.

6.15 p.m.

That was the position. There was plenty of money during the time when Cunard was saying to the "National Assistance Board", "We have only got millions here in reserve, not sufficient to deprive us of assistance from the national Exchequer." That was, I thought, not unfairly, the outcome, at least one of the results, of the Parliamentary Secretary's intervention.

Now I come to the main point.

Sir A. V. Harvey

What point?

Mr. Rankin

Mine is a many-pronged attack.

I come to the other point I was making, that there was no link. The aircraft hand of Cunard does not know what the shipping hand is doing. All that is nonsense because the capital is jointly held. The capital of the Cunard Steam-Ship Company Limited, which now owns all the shares of Cunard Eagle Airways (Holdings) Limited and Eagle Aviation Limited, is £15½ million. I hope that that corresponds with the balance sheet which is jointly held by the hon. Members for Gillingham and Southampton, Test.

I come now to the interlocking of the two directorates. There are not two separate directorates because Mr. Bamberg, the former sole owner of Eagle—and this business of the ownership in aircraft companies is a story which some day will be worth telling—

Mr. Diamond

Worth telling now.

Mr. Rankin

I am telling a little bit of it. This is another of my prongs. I could tell, but better not.

Mr. Bamberg is now the chairman of the board of directors of Eagle Airways. I shall read their names: Mr. H. R. Bamberg; Mr. M. A. Guinane—I hope that I shall have the assistance of the hon. Member for Gillingham in pronouncing it; Mr. N. A. Hill; Sir John M. Brocklebank, Bt., chairman of the Steamship Company; Mr. W. Donald—and I missed one, the name of Mr. F. F. A. Burden, M.P., who, I assume, is closely identified with the hon. Member for Gillingham; and the last named is Mr. R. H. Senior. I am not giving the others.

I am naming three particularly because the Cunard Company gave money to Eagle and then said—I am mentioning this now because I will come back to it later—"We have invested money in your project. We want representation on your board. We are going to carry on the two boards together." So there are not two boards; there is one interlocked board. Cunard Steamship Company and Cunard Eagle Airways are bound together and the hon. Member for Gillingham is a member of that board and is thus interested not only in aircraft, but also in the shipping sector of that business.

No one doubts—I think that no one can doubt now—that the money was there if Cunard had wanted to use it. It did not want to use it because it had a beneficent "nanny" and it had sufficient influence with that nanny to gain more sustenance. The company came to a conclusion and asked itself, "Why use more money when the public purse is there and the open hand is once again at the public Exchequer?" I think that the Cunard Company is getting enough if it gets £12 million and I shall vote for that when the time comes. I hope that I shall find with me in the Lobby the hon. Member for Gillingham and the hon. Member for Southampton, Test.

Sir A. V. Harvey

When the Second Reading took place I was unhappy about the whole project of "Q/", but, having given the matter further consideration, and with some reservations, I think that the country wants the "Q/". I will try to give a few reasons for that conclusion.

The Cunard cash reserves are not to be confused with the other reserves. If one talks about buildings and offices in America and Britain one must remember that they are not easily saleable, but if one is thinking of cash reserves, whether of £3 million or £6 million, I imagine that with the cost of renovating and overhauling ships today in any country those reserves are fully required if the whole fleet is to be maintained and even the small ships replaced to keep the line in operation, quite apart from any "Q/" project.

We heard the other day of an American aircraft flying from Texas to Paris in three hours and a quarter. Unfortunately, I cannot see a British aircraft doing that in the near future. There are few of the larger aspects of science in which Britain can give a lead. There is at least prestige in having a large ship crossing the North Atlantic, provided that it can earn its keep. If a Mark II supersonic aircraft can fly into Idlewild every few hours it will impress Americans ten years' hence more than a 75,000-ton ship, but we cannot have that and, therefore, this is the next best thing.

We are a maritime nation and while the French, the Italians and others have super-liners, this is the best project for Britain. The 30,000-tonner is a project on paper which is being looked into. The order has not yet been placed. We have heard of a man who is to build ships to bring people across the Atlantic for £10 or £12 each. There was great publicity about it, but we have heard no more since.

Mr. Diamond

The hon. Member is always very careful in his statements and no doubt has good authority for what he has just said, but The Times, which I accept in this connection, made it clear that the order had been placed with an Italian shipyard, the same shipyard which had previously built a ship for the same line. It was placed because the shipyard was good at it. A tender went out two or three years ago and the order has just been placed. The whole reason for its coming to light now was that a firm order had been placed.

Sir A. V. Harvey

But we are not sufficiently competitive with American lines. If we are to be in business we must be competitive. The North Atlantic air traffic has caused me some concern for some time, and particularly the number of daily flights carried out by the American airlines from the United States to Britain. They carry out more services than B.O.A.C. and, as a consequence, they are capturing more traffic.

It may be argued that if an independent British airline is operating parallel with B.O.A.C. that may divide the spoils, but that is not the case. The Cunard Company has a great reputation in North America and a great many Americans prefer to travel on Cunard ships rather than on their own ships because they enjoy more comfort. Cunard has a fine organisation throughout the whole of North America and it can sell tickets for travel by air provided that it receives a licence. I shall not say anything about that now, because it is under consideration by the Air Transport Advisory Council, but the more British aircraft, provided that they are properly run and organised, compete on these routes against the Americans, the better. We need to compete as much as we can.

As to the question of the Boeings, I would prefer that British aircraft were ordered, but the VC 10 is not ready and will not be for another three years. I should like an assurance from the Cunard Company that when it is in business in the air it will switch over to British aircraft when the time comes. But I do not connect the financing of the Boeings—of which I do not know the details and have no means of finding them out—in any way with subsidies and loans for ships.

We know that today credit can be obtained up to ten or twelve years through American investment bankers to sell American aircraft throughout the world and that that is why the British have lost orders from Qantas Airways, which has gone completely American. This has been entirely due to the credit terms offered. I hazard the guess that Cunards would put little money in until it got going and if the company takes advantage of these terms, then good luck to it. I hope that the proposal in the Bill will go through and that the Minister will drive the best bargain he can. If we have this ship one of our great shipyards will be helped and Great Britain will continue to fly the flag in the North Atlantic.

Mr. Willis

I should like to congratulate the Joint Parliamentary Secretary to the Ministry of Transport, who has special responsibility for shipping, on his first appearance at the Dispatch Box, but that is about all that I can congratulate him upon. The hon. and gallant Gentleman won something of a reputation in the House of Commons as being one of the vigilant watchdogs of public expenditure. He also won a reputation for himself by the novelty of his ideas for saving money which he put before the House. He was one of the keenest members of the Estimates Committee and he was always chasing around trying to find ways of saving money. I was rather surprised, therefore, to hear his defence today of the proposition which the Committee is now asked to approve, namely, that we should make available a sum of £18 million to the Cunard Company, a sum which we on this side of the Committee seek to reduce.

As far as I followed the hon. and gallant Gentleman's arguments, to which I listened attentively, they were, first, that if the Committee accepted our Amendment we should be breaking arrangements which had been accepted by the House of Commons and which had been agreed with the Cunard Company. The second part of the hon. and gallant Gentleman's speech was devoted to providing some figures to show us that the Cunard Company could not be expected to find more than £12 million. The answer to both arguments advanced by the hon. and gallant Gentleman is now very much in question and is very much the same, namely, we are suggesting that the agreement ought now to be looked at again in the light of the new information available.

6.30 p.m.

We cannot be expected to approve an agreement which we now discover to have been made on the basis of—we do not know—false statements. Perhaps I should not say "false", but it is clear that the matter has been misrepresented. This is the difficulty about it; we do not even know whether there have been misrepresentations or not, because we do not know what was represented to the Government or the Chandos Committee in the first place. The whole business is made exceedingly suspicious because the Government have failed to give us the information which would enable us to make a sound decision.

What we are being asked to do is to support a proposition not on the basis of evidence made available to the Chandos Committee, on which it made is recommendation, but on the basis of what the Government are telling us is the case for supporting it. These are two very different things, and I suggest that if they were not two very different things we should have been given the Report of the Chandos Committee. It is precisely because they are different that the Government concealed the Report and put forward their own specific set of arguments. It seems to me that we have every right to question the agreement now because, in the light of the information which has been placed before us today, it appears to have been based upon misrepresentation, a situation which was not understood at the time of the Second Reading.

In the latter part of his speech, the hon. and gallant Gentleman gave us a number of figures. I took note of some of them, but I gave up after a short time because it appeared to me that it was a very peculiar way to present a financial proposition to us—by a selection of figures, while withholding the complete picture. I should have thought that if we were to make a judgment on the basis of figures provided by the Cunard Company we ought at least to have them all and not just a selection picked out by the right hon. Gentleman and offered to us for our consumption. That is not the way very large financial deals are made.

I assure the hon. and gallant Gentleman that anybody seeking National Assistance would not get away with this; he would not get his rent allowance, never mind anything else, on this basis. He would have to produce documents and put them on the table and answer questions about them. But when we come to big business we are told that we must not question the figures. We are told "After all, this is big business". It is in a rather different position from the poor individual who is struggling to keep body and soul together on a mere pittance.

The hon. and gallant Gentleman said that we could not expect the Cunard Company to find any more money, not because the venture was not commercially justifiable but because it was not fair to ask the company to take the risk. The hon. and gallant Gentleman went so far as to say that the Government are eliminating the risk. If the Government are eliminating the risk from private enterprise, what justification is there for private enterprise? I always understood that one of the justifications offered by the Conservative Party for the continuation of private enterprise and the payment of very large dividends was that private enterprise took the risk and was entitled to be rewarded according to the risk it took.

That is the argument which is so often put to us, but the hon. and gallant Gentleman has now destroyed it. He says, "We are taking the risk, and the Cunard Company will, of course, allow us to take the risk at a certain fixed rate of interest". I have no doubt that if the Cunard Company cannot meet the repayments on the loans which are made to it, it will be treated in a very kindly manner, much more kindly, for instance, than Napiers treats people who cannot meet their repayments on goods which they get in Scotland.

The hon. and gallant Gentleman went on to say that there was no close connection between this proposition and the fact that the Cunard Company had taken over Eagle Airways and was buying Boeing aircraft. But there is a connection. What is the Cunard Company doing? It is saying, "We have, or could lay our hands on, so much capital, but we are going to place it in Eagle Airways because that offers a much higher rate of interest". Of course it does. The hon. Member for Gillingham (Mr. Burden) told us what a wonderful prospect there was for profits. The hon. Member for Macclesfield (Sir A. V. Harvey) has told us exactly the same thing, pointing to the handsome profits which the firm can make and to the fact that it has a wonderful organisation in America for selling tickets and so on.

In other words, this private giant has the opportunity of selecting what it will do and putting its money into the most profitable operations while we subsidise something which is likely not to be profitable. What sort of a Government have we? They seem to lose their heads completely every time they deal with private enterprise—and they also lose the taxpayers' money. I am left almost speechless when I look at the Government's antics in dealing with this business. I wonder whether they would hand out their own money so lavishly to the Cunard Company. I do not think so.

We have today heard how the Cunard Company makes its profits elsewhere, and we have been told that we shall subsidise it for this project. Why? We do not know. It is for reasons which are in dispute, and reasons which certainly have not convinced either side of the House of Commons. I represent a Scottish constituency, where the shipbuilding industry is exceedingly important and where one in ten of our workers are dependent upon it. Obviously, I want these men to have work, but I wonder whether this is the best way to give it to them. In any case, the work might not go to them at all, because I am reminded that it is 5-1 against it going there. Even if it went there, is this the best way, in the interests of the nation, to provide work for our people? I very much doubt it. It shall certainly require a great deal more information about this than the Government have so far given us.

A desire to run a prestige liner across the Atlantic to carry millionaires backwards and forwards—is that really the best way to spend our money? Half our country is declining and becoming depopulated. We cannot get even the smallest industry into some areas. In the whole of the Highland area, half the area of Scotland, we have been lent—not given—under the Local Employment Act only £54,000 to provide work in an area representing one-sixth of the United Kingdom. If the £6 million which we suggest should be saved were saved, it could make a very big difference there and in a large number of districts in Scotland, and provide work of a much more necessary and essential kind.

We need all sorts of things in Scotland, instead of which we are faced with this proposition. I find it difficult to feel that this is the best way of helping even the shipping industry. The same views have been expressed from the benches opposite, but during this debate I have heard only one speech from a Member opposite who is not an interested party.

Mr. J. Howard

The hon. Member keeps referring to me, because of my constituency, as an interested party But he is just referring to building ships in the Highlands. Is he not an interested party in Scotland?

Mr. Willis

The hon. Member must not misquote me. I do not imagine that we would be building Cunard liners on Loch Ness. Nevertheless, many things could be done in the Highlands with this £6 million which would provide opportunities for our people there to find work.

Members opposite have criticised the Bill. I hope that they will be much more searching for information than they have been up to the present. The Minister of Transport should "come clean" about this. I see that he smiles. He tries to "get away with murder" in the House time after time because he smiles very pleasantly. That might look all right in the Press, but it does not cut a great deal of ice here.

What were the recommendations of the Chandos Committee? What were the facts on which those recommendations were based? Is it true that a great number of other shipping companies think that this project is not a good one? Is it true that the Cunard Company could not by itself build such a liner—because that has been challenged very effectively? Is it true that this is the best way to help the industry as a whole? We should have answers to these questions.

I hope that my right hon. and hon. Friends will go into the Lobby in support of the Amendment. I believe that if private enterprise cannot do a job, the Government should do it. I believe in State enterprise. There does not appear to be much private enterprise left in some of these firms. The only enterprise shown is when the profits are big enough. I believe that, in a case like this, where it is desirable for something to be done in the interests of the nation, the nation should do the job itself and reap the profits, if profits are to be got.

I think that the Parliamentary Secretary could run a very good nationalised shipping corporation to undertake a job like this. He has the initiative, the courage and the originality of idea. Of course, he has also shown that he is willing to work in a public enterprise, because he has spent much of his life in a nationalised service. He has no conscience over that. To let the nation do the job would be a much better way of tackling this problem.

6.45 p.m.

Mr. Marples

I hope that the Committee will not think it discourteous of me if, after three-and-a-quarter hours' debate on the first Amendment, I ask it to come to a decision. I realise that there is a clear division of opinion, but I hope that the Committee will not think it unreasonable if I rise at this point.

I congratulate my hon. and gallant Friend the Joint Parliamentary Secretary both on his appointment and on his speech today. He has had distinguished service at the Admiralty—which, as the hon. Member for Edinburgh East (Mr. Willis) said, is a nationalised service—and I am sure that his knowledge and experience will be of great value in trying to overcome the difficulties faced by the shipping and shipbuilding industries. Since my hon. and gallant Friend spoke, a number of hon. Members have made speeches and I want to reply to these before I come to what I consider is the main point involved here.

My hon. Friend the Member for Macclesfield (Sir A. V. Harvey) referred to a plane which came from America to Paris in a very short time. It was refuelled twice on the way, which does not make it a commercial proposition. If anyone is to go by ship—and I take him with me here—that will take five days. Compare that with perhaps seven hours in an aircraft now and with the situation when an aircraft reduces the journey to five hours. I do not think that that reduction will make much difference to the choice of the person who goes by sea.

The hon. Member for Gloucester (Mr. Diamond), who is a distinguished member of the Institute of Chartered Accountants, will no doubt be gratified to know that on the Chandos Committee there was an equally distinguished member of the Institute, Sir Thomas Robson, whose advice and guidance were available to the Chandos Committee just as the hon. Member's advice and guidance are available to this Committee. A summary of the Chandos Committee's recommendations was published in HANSARD and has been quoted time after time. Sir Thomas Robson was one of those who signed the summary.

Mr. Callaghan

Is it not a fact that Sir Thomas, with the other signatories, said that the Cunard Company had available only £12 million from its own resources to finance this project? Is that true?

Mr. Marples

I will deal with that point. I want to deal with it in my own way.

Mr. Callaghan

Is it true?

Mr. Marples

That is what was true in this particular project. There were certain reasons, which I will advance, why that statement was made.

Before I get on to the main point I want to thank the hon. Member for Glasgow, Govan (Mr. Rankin), because on Second Reading he said: I assure the Minister right away that he has my support for the Bill, and that may somewhat lighten the burden which both sides have placed upon his shoulders during the debate."—[OFFICIAL REPORT, 1st May, 1961; Vol. 639, c. 995.] I thank the hon. Member for his support today, though I think that it was more qualified than on the previous occasion.

Mr. Rankin

The right hon. Gentleman will appreciate the reasons for that. Of course, I still support the Bill, and I do so because I have an interest in it. But the right hon. Gentleman will also agree that, though my support is still with the Bill, we now know more of what has been going on between Second Reading and the Committee stage than we did before.

Mr. Marples

The spirit is willing, but the flesh is weak.

Most of the speeches have ranged rather as though in a Second Reading debate, but the House has approved this Measure in principle. Most of the contributions today have stated that the company has cash for other types of investment and, therefore, it should put the money into this project. I want to make a distinction.

Like many others, the Cunard Company has many ventures. The hon. Member for Gloucester mentioned something about a ship of 30,000 tons going at 24 knots. That was about the size and speed of the old "Mauritania," which has now been scrapped. The company ran that vessel without a subsidy—there is nothing new in that. But it did not run the ship on the express passenger service across the Atlantic.

The company's activities can be divided into two. The first category is where it competes with heavily subsidised foreign competitors. The hon. Member for Gloucester and the hon. Member for Nelson and Colne (Mr. S. Silverman) quoted my Second Reading speech, but did not go on to the following paragraph, where I said: At this point, it might be convenient to the House to examine the facts and nature of the express passenger North Atlantic service. I wish to distinguish between that express passenger service and the ordinary service across the Atlantic, because the express passenger service takes the cream of the passengers-who go across the Atlantic by ship. I went on to say: Thirdly, it is the most heavily subsidised service in the world."—[OFFICIAL REPORT, 1st May, 1961; Vol. 639, c. 914.] and I later gave details of the competition which the company is facing—because that competition is not the same as it is in the case of Boeings or in the case of the old "Mauritania". The company is facing competition which is vastly unfair. The United States pays a subsidy of 58 per cent. on the capital cost of its ships, and the French provide a subsidy of 20 per cent. on the capital cost. We are giving 11 per cent. That is not over-generous by any stretch of the imagination.

Further, the Americans subsidise the running costs of their ship, the "United States" to the extent of 28 per cent., and the French provide a sum equal to any losses which the French company makes. We provide no subsidy. How can we ask any firm of any sort to face that kind of competition and live? It cannot be done.

Mr. Shinwell

Did the right hon. Gentleman ask them?

Mr. Marples

Therefore, the company said that if we wanted an express passenger service the Government would have to assist.

Mr. A. C. Manuel (Central Ayrshire)

Who wanted it?

Mr. Callaghan

The Minister has said that we could not ask the company to face this competition on its own. His hon. Friend the Member for Ashford (Mr. Deedes) asked whether the Cunard Company wanted to run this line and had come to the Government and asked for the necessary financial assistance, or whether the Government, for their own reasons and prestige purposes, wanted this express line to go on and, therefore, asked the company to carry on.

Mr. Marples

It is clear from what I said in the Second Reading debate. Perhaps I may repeat it. I said that the story started two or three years ago, when the company told the Government that the "Queen Mary" would soon be too old to go across the Atlantic, and that it could not face the existing subsidised competition unless the Government provided some help. The company did not ask for assistance on the same scale as that provided by other nations, but it wanted a little help so that it could provide for this service, and it stated that all it could provide, in the face of this heavy competition, was £12 million. The Government therefore set up the Chandos Committee with a view to finding out what financial arrangements could be made.

The red herring that has been trailed this afternoon arises from the fact that the company has two types of activity. It runs many ships to Canada without a subsidy, but if we want an express North Atlantic service it must have a subsidy.

Mr. Shinwell

How much?

Mr. Marples

A subsidy of £3¼ million.

Mr. Callaghan

I appreciate that the Minister is trying to answer the point, which is central to the debate. He has told us that the Chandos Committee was set up for a special purpose, but it was the Government who gave that Committee its terms of reference, and the Government asked the Committee to consider how an express passenger service across the North Atlantic could best be maintained. I am asking a question which is susceptible of a pretty clear answer. Do the Government want to maintain this for prestige purposes, or does the company want to run this service as a revenue-earning operation.

Mr. Marples

In the first place the company said, "The 'Queen Mary' is old, and shortly will not be able to carry out this task. Therefore we, who have a great tradition for crossing the Atlantic, wish to continue if we can get some help. What sort of help can you give us?" That is why the Government set up the Chandos Committee. It was to go into all the questions and find out what sort of assistance could be given to the company. It was reasonable both from the Government's point of view and that of the company and, at the same time, comparing the subsidy with those paid by the United States and France for their ships. If we do not give the company that help Great Britain will withdraw from the express passenger service across the Atlantic. If hon. Members wish for that to happen they should have voted against the Second Reading of the Bill, because that is a point of principle.

Mr. P. Williams

Does not my right hon. Friend agree that he would love to be shot of the terms of reference of the Chandos Committee?

Mr. Marples

It is nothing like that. I am giving the Government's point of view, and saying that the company is receiving less than its competitors on that route. Therefore, as a Government we have a reasonably good bargain.

As my hon. Friend has said, this Amendment, which seeks to reduce the amount of the loan, is a wrecking Amendment. There would be no service if it were accepted, and we must face that fact. Therefore, I hope that the Committee will come to a decision by dividing, so that we can see who is in favour of this express passenger service and who is not. The Government cannot accept the Amendment at this stage. If the hon. Member for Cardiff, South-East (Mr. Callaghan) wishes to speak I will resume my seat and give him the opportunity, and I hope that afterwards the Committee may be able to come to a decision.

Mr. Willey

The Committee should know that the right hon. Gentleman is being gravely discourteous to hon. Members. The right hon. Gentleman was informed in the usual way that my hon. Friend the Member for Cardiff, South-East (Mr. Callaghan), who has sat here throughout the debate, wished to speak before the right hon. Gentleman intervened.

Mr. Marples

As the hon. Member has accused me of discourtesy, perhaps I may be allowed to say that we have already had two Front Bench speeches from the benches opposite, and I thought that it would be no discourtesy if I were the second Front Bench speaker from this side of the Committee.

Mr. Willey

The right hon. Gentleman has only underlined his discourtesy. I am certain that all hon. Members expected him to express some regret or, alternatively, offer an acceptable explanation, if he was so anxious to intervene.

We are now discussing something of considerable importance. It is clear that some hon. Members opposite are very critical of the Government on this issue. They have spoken in favour of the Amendment. In fact, the hon. Member for Sunderland, South (Mr. P. Williams) has expressed the intention of voting against the Government. This is not a matter in respect of which the Minister can say, at 6.45 p.m. "We are going to divide on this at seven o'clock". This is a very serious issue.

Reference has been made to the second leader in The Times of today. The right hon. Gentleman is being too clever by half if he thinks, just before we have to adjourn our business, that we should reach a hurried decision by way of a Division. We are relieved to see that he is not supported in that wish by the Patronage Secretary who, during the course of this Session, has learned discretion.

I start with the first matter that was discussed and which is the crux of the situation—the Report of the Chandos Committee. There are two things that we do not know about that Report. We do not know what cautionary advice the Committee may have tendered to the Government. That has not been revealed, Therefore, we do not know how we should consider the Amendment, because we do not know what qualifications or reservations the Committee may have made in its report. The hon. Member for Gillingham (Mr. Burden), with his inside information, may be better informed. He may be as well informed as the right hon. Gentleman—but we do not know. This is a matter which should be before the Committee. It is unrealistic to expect us to come to a decision without being given this information.

We are suggesting that the figure involved should be reduced by £6 million—from £18 million to £12 million—and there was a burden upon the Minister to say that for reasons given by the Chandos Committee he felt unable to accept the Amendment. He has given no such information to the Committee. We are still as ignorant as we were about the reasons behind the recommendations of the Chandos Committee—

It being Seven o'clock, The CHAIRMAN left the Chair, further Proceeding standing postponed until after the consideration of Private Business set down by direction of The CHAIRMAN OF WAYS AND MEANS, under Standing Order No. 7 (Time for taking Private Business).