Commons Sitting of 25 March 1964

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  MINISTRY OF AVIATION

    Ferranti Ltd. (Bloodhound Contract)
    Mr. Diamondasked the Minister of Aviation whether he will now state the total profit made by Ferranti Ltd. on the Bloodhound contract up to 31st March, 1961; and what profit would have been needed to secure a return of 10 per cent. per annum on the capital employed.
    The Minister of Aviation (Mr. Julian Amery): My Department has no right of access to the books of Ferranti Ltd. for the purpose of ascertaining the actual profit made by the firm. I do not, therefore, know what this was.
    According to the best estimate I can make, it seems possible that the profit made on Bloodhound production for the Ministry of Aviation up to 31st March, 1961, was approximately £4·5 million. On the same basis of calculation, the profit to secure a return of 10 per cent. on capital employed would have been about £400,000.
    Mr. Diamond: Do I gather that the Minister is saying that, according to the best of his information, a reasonable return of profit—the figure of 10 per cent. on capital employed is reasonable—would have been £400,000 and the actual profit made was more than 10 times that amount?
    Mr. Amery: On the figures as I estimate them—as I say, I have no knowledge—it looks as though £400,000 would have represented 10 per cent. on capital employed and as though the profit made may have been as much as £4½ million.
    Mr. Diamondasked the Minister of Aviation whether, in computing the figure for overhead expenses incurred by Ferranti Ltd. on the Bloodhound contract, his Department disallowed trade subscriptions to the Aims of Industry organisation and similar bodies.
    Mr. Amery: No, Sir. For the purpose of payment for supplies on contracts such as these, the contractor's overheads are expressed in the form of a percentage addition to the direct labour costs. This is based on the proportion which the contractor's general expenses bear to direct labour employed. In assessing this figure, we do not normally take account of individual items which, as in this case, would be too small to affect the final percentage.
    Mr. Diamond: How do we know that they are too small to affect the final percentage unless we are given an idea of what the final figure is? Is it not a fact that every accountant acting in this way examines items of this kind, and is it not right that the country should know whether or not subscriptions to organisations of this kind are paid for by the taxpayer so that the Conservative Party can benefit out of the taxpayer's payments?
    Mr. Amery: There is, of course, a general examination of figures to see whether they are of a size which would affect the final percentage, but no purpose would be served by eliminating from the contractor's items general expenses which would not affect the percentage.
    Mr. Lee: Will not the Minister agree that there is now so much public money, very rightly, being put into the aircraft industry that it would be a very good thing if he, when looking into the question of contracting, insisted upon a return being given to him of any public moneys to be used in this way?
    Mr. Amery: The important thing is to make quite sure that we get a proper percentage. The object of the negotiations with the contractor is to agree an overhead rate, and this, naturally, involves some give and take. We do not want to waste time, have excessive effort or employ more people than necessary in looking into individual items; and not every small item can be identified as

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    having in the outcome been specifically allowed or disallowed.
    Sir C. Osborne: We recognise that Ferranti is probably the most efficient company in the world in this class of business, and, as a result of these contracts, I believe, it secured great export orders, but could my right hon. Friend assure the House that these extraordinary profits are not being repeated elsewhere in other contracts, and could he assure us that the other tiny items such as those raised in this Question do not affect the major one brought out in answer to Question No. 1?
    Mr. Speaker: We cannot go back to Question No. 1 now. I do not understand this process. A supplementary question can arise only out of the last answer.
    Mr. Wiggasked the Minister of Aviation whether the report of the committee of inquiry, presided over by Sir John Lang, into the price charged by Messrs. Ferranti Limited for the Bloodhound missile, will be presented to the House.
    Mr. Amery: Yes, Sir. It is intended to publish the report as a White Paper.
    Mr. Wigg: Can the right hon. Gentleman say when the report will be published? Secondly, as this firm has had a touch "touch" the tune of several million pounds, have negotiations been opened with a view to the return to the public of money improperly obtained? Will he assure us that no more contracts will be awarded to Ferranti's until the money has been refunded?
    Mr. Amery: I am not in a position to say exactly when the report will be published. Perhaps the hon. Gentleman would give me notice of the other questions.

    Polaris Submarines (Missile Tests)
    Mr. W. Hamiltonasked the Minister of Aviation when the testing of missiles to be placed in the British Polaris submarines will commence.
    Mr. Amery: The A3 missile, with which our Polaris submarines will be fitted, has been under test by the United
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    States Navy for some time. Development is at an advanced stage and the missile is planned to enter service with the U.S. Navy later this year.
    Mr. Hamilton: Can the Minister say whether the warheads and the firing mechanisms have been tested as well, because clearly the one goes with the other? If not, when does he anticipate testing them, in view of the test ban treaty?
    Mr. Amery: The firing mechanisms have been tested repeatedly. I understand that the warheads, on the American side, were tested underground long ago. Our warheads are under development. There is no need for a positive test of the nuclear material to ensure that the system itself works. The detonation is quite distinct from the nuclear.

    Aircraft Accidents
    Mr. Dribergasked the Minister of Aviation if he will publish in HANSARD figures showing the number of persons killed in accidents involving aircraft flown by British operators in each of last 10 years, to the latest convenient date; how many were killed in aircraft flown by publicly-owned Corporations and how many in aircraft operated for private profit; and if he will publish further figures relating the fatal accidents, in each category to the number of miles flown by publicly and privately-owned airlines.
    The Parliamentary Secretary to the Ministry of Aviation (Mr. Neil Marten): As the Answer includes a number of figures, I will, with permission, circulate it in the OFFICIAL REPORT.
    Mr. Driberg: Without having seen these figures, but knowing their general trend from figures that have been released before, may I ask the hon. Gentleman whether he would agree that there is clearly a causal connection between the high accident rate and the inevitable pressures of the commercial motive?
    Mr. Marten: There are reasons for all accidents happening, but we must not be misled by straight figures because there is such a variety of factors which go to make up accidents.
    Mr. Cronin: Is not the real problem that charter flying, which is done largely by the independent companies, is about 10 to 20 times more dangerous than flying with the Corporations? Is it not the case that the Government have completely failed to take steps to ensure that charter flying is made safer?
    Mr. Marten: I disagree with the hon. Member's assessment because it must depend on the basis on which one calculates the ratio of danger. But clearly the highest accident point is take-off and landing, and it is true that charter flight aircraft make more take-offs and landings in relation to the whole than the scheduled flights.
    Mr. Rankin: We have been asking questions about this apparent frequency of accidents—[HON. MEMBERS "Question."] Is the hon. Gentleman aware that we have been asking questions of this sort for quite a long while and that we have been getting much the same answer from him? What advance is being made in finding an answer which will satisfy all of us that accidents on the private lines are not more frequent than those on the public ones?
    Mr. Marten: I am sure that the whole House is concerned about any accident which happens, whether it concerns a private company or public Corporation. We are doing all that we can. There is the Flight Safety Committee which studies all accidents and disseminates the

    TABLE 1

    ACCIDENTS TO AIRCRAFT OPERATED FOR PUBLIC TRANSPORT (PASSENGER AND FREIGHT OPERATIONS) BY CORPORATIONS AND BRITISH INDEPENDENT COMPANIES

    Calendar year

    Total number of persons killed

    Number killed in Corporation Aircraft

    Number killed in Independent Operators Aircraft

    1954

    …

    …

    …

    …

    …

    96

    96

    0

    1955

    …

    …

    …

    …

    …

    16

    15

    1

    1956

    …

    …

    …

    …

    …

    91

    32

    59

    1957

    …

    …

    …

    …

    …

    114

    30

    84

    1958

    …

    …

    …

    …

    …

    99

    57

    42

    1959

    …

    …

    …

    …

    …

    46

    0

    46

    1960

    …

    …

    …

    …

    …

    3

    0

    3

    1961

    …

    …

    …

    …

    …

    102

    27

    75

    1962

    …

    …

    …

    …

    …

    125

    1

    124

    1963

    …

    …

    …

    …

    …

    0

    0

    0

    1964 (up to 10th March)

    …

    …

    83

    0

    83

    TOTALS

    …

    …

    775

    258

    517

    results. We have set up recently the Operations Analysis Group to study the take-off and landing of aircraft. Therein we might hope to find a solution.
    Sir S. McAdden: Would my hon. Friend agree that it is pretty disgraceful that these allegations should be made about charter companies which are subject to the same safety regulations as the Corporations? Is it not obvious that charter companies which operate with a full payload must, if unfortunately they have an accident, have a greater number of casualties than the other companies whose aircraft are flying half empty?
    Mr. Marten: Those are two of the general factors which must always be taken into account. I urge the House to treat these bare figures with reserve, although I share the concern about them.
    Mr. Driberg: If we are not to believe or to take any notice of what the hon. Gentleman called the "straight" figures, which I take it are those which he will put in HANSARD, what are we to believe? Are statistics of no use at all?
    Mr. Marten: I did not say that they were not to be believed, because they are figures which we are giving to the House. They are clearly to be believed. But all these things have to be weighted in assessment, and until all the factors are brought into account I think that we should treat these figures with reserve.
    Following is the answer:

    TABLE 2

    FATAL ACCIDENTS TO AIRCRAFT ON SCHEDULED AND NON-SCHEDULED BRITISH PASSENGER AND FREIGHT SERVICES

    (Moving five year totals)

    Financial Years*

    B.O.A.C. and B.E.A

    Private Companies†

    Number of fatal accidents

    Number of fatal accidents per 100 million aircraft miles

    Number of fatal accidents

    Number of fatal accidents per 100 million aircraft miles

    1953/54–1957/58

    …

    10

    3·2

    8

    5·4

    1954/55–1958/59

    …

    …

    9

    2·7

    10

    6·2

    1955/56–1959/60

    …

    …

    8

    2·1

    12

    6·9

    1956/57–1960/61

    …

    …

    7

    1·7

    10

    5·4

    1957/58–1961/62

    …

    …

    6

    1·3

    12

    6·0

    1958/59–1962/63

    …

    …

    4

    0·8

    10

    4·9

    Notes

    * This table has been based on financial years because this is the only basis on which statistics of non-scheduled operations by private companies before 1961–62 are available. Progressive five year periods have been used to smooth out sharp fluctuations in the rates from year to year.

    † Two accidents, one in 1958 and the other in 1960, on non-scheduled services operated by private companies who were not members of the British Independent Air Transport Association have been excluded from the table because non-scheduled operating statistics for the periods prior to 1961–62 are available in respect of B.I.A.T.A. members only. It is not thought that the inclusion of these accidents and their associated operating statistics would materially alter the picture.

    British Eagle (London-Scotland Services)
    Mr. Rankinasked the Minister of Aviation if he will make available the evidence and argument on which he based his decision to reject the Air Transport Licensing Board's finding on the application by British Eagle for increased frequencies on the London-Scotland services.
    Mr. Amery: The evidence and argument, which was heard in public by the Appeal Commissioner, is available in my Ministry if the hon. Member wishes to consult it. The Appeal Commissioner's report has also been published and I am sending a copy to the hon. Member.
    Mr. Rankin: But that hardly answers the Question on the Order Paper. Is it not the case that the Air Transport Licensing Board gives very serious consideration to every application for operational rights at any airport and that these proceedings are held in public? When the Minister takes the very serious decision to reject a carefully considered applicatiton, why should he not make available to the public the reasons for his decision?
    Mr. Amery: The Question asked me whether I would make available the evidence and the argument. The evidence and the argument, taken overall, are extremely bulky, but if the hon. Gentleman wishes to come and see them I should be delighted if he would do so. The Appeal Commissioner's report is somewhat smaller, and this I would propose to send to him.
    Mr. Speaker: Mr. Rankin, Question No. 8.
    Hon. Members: Wake up.
    Mr. Rankin: Shut up. Question No. 8.
    Mr. Rankinasked the Minister of Aviation whether he will make it a condition of his acceptance of the recommendations of his Commissioner, in regard to British Eagle Airlines' application for increased frequencies on the London-Scotland service, that the service be operated from and to Prestwick Airport.
    Mr. Amery: I am not sure whether the hon. Member's last remark was addressed to the Chair.
    The Answer is, "No, Sir".
    Mr. Rankin: Owing to the interruptions on the benches opposite. I did not hear the Answer.
    Mr. Speaker: The Answer was, "No, Sir".
    Mr. Rankin: Thank you, Mr. Speaker.
    Is the Minister aware that Prestwick Airport is in a rather difficult situation? Is it not the case that he is doing his best to help it? Does not he realise that here is one way in which he can help it—by directing this service to operate from Prestwick? If the right hon. Gentleman has the power to say that it can operate from Renfrew, surely equally he has power to say that it could operate from Prestwick.
    Mr. Amery: If the hon. Gentleman is suggesting that Prestwick should become the normal domestic airport for Glasgow—
    Mr. Rankin: No.
    Mr. Amery: —that is an entirely separate question. British Eagle wishes to operate from Glasgow and therefore that is the operating point in respect of which it applied for a licence. It has been given a licence.
    Sir Knox Cunningham: Is my right hon. Friend aware that the public would appreciate a more frequent service on other routes by British Eagle? Will he do his best to make that possible?
    Mr. Amery: I will certainly take into account what my hon. and learned Friend says, but that is a rather different question.
    Mr. Dempseyasked the Minister of Aviation what requirements he laid down, when approving the extension of British Eagle Airways services to Scotland, regarding the application of adequate safeguards for passengers against accident risk.
    Mr. Marten: These services are subject to the same safety requirements as apply to other air transport services.
    Mr. Dempsey: When the Parliamentary Secretary says "other air transport services", does he mean that we should demand for private operators the same standards as we insist on for our publicly-owned airlines? Is he aware of the growing uneasiness, especially in Scotland, at the accident rate among private operators? Will he give an assurance that the standards insisted on
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    will be similar to those demanded for B.E.A., for example?
    Mr. Marten: We are here concerned with public transport aircraft, not private flying. A detailed and exacting code of safety regulations applies to all air transport operators in this country.

    Aircraft Orders
    Mr. Stratton Millsasked the Minister of Aviation whether it remains the policy of Her Majesty's Government, as stated in this House on 15th February, 1960, to concentrate Government orders for aircraft on the five major groups of the aircraft industry, except where specialised requirements or public policy make it necessary to do otherwise; and if he will give an assurance that the position of Short Brothers and Harland is still protected by the exception stated above.
    Mr. Amery: The answer to both parts of my hon. Friend's Question is "Yes, Sir".
    Mr. Mills: Will my right hon. Friend give an undertaking that the assurance which was given on that occasion will be honoured when the exact percentage of work which is to be sub-contracted to Shorts under the HS681 contract is being finalised by his Department?
    Mr. Amery: I am not sure what is the implication of my hon. Friend's supplementary question. We have agreed that a substantial part of the 681 contract will be sub-contracted to Shorts.
    Mr. Mills: May I help my right hon. Friend in underlining—[HON. MEMBERS: "No."]—is my right hon. Friend aware that the point of my previous supplementary question was to get an assurance that the undertaking that a substantial amount of work under the contract will be given to Shorts when the contract is fixed is fulfilled?
    Mr. Amery: I would certainly hold to the term which I used—"substantial". I hope that my hon. Friend will accept the same definition of the term as I do when the decision is announced.
    Mr. Cronin: As Americans and Italians are making aircraft for the British Armed Forces, can the right

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    hon. Gentleman give us an assurance that he will try to concentrate orders on the British aircraft industry in future?
    Mr. Amery: This has always been our policy. I remember being taken to task by the right hon. Member for Belper (Mr. G. Brown) not so very long ago for not buying American transports.
    Mr. McMasterasked the Minister of Aviation what steps he is taking to give effect to the Estimates Committee's recommendations relating to the placing of Government aircraft orders.
    Mr. Amery: The recommendations in the recent Report of the Select Committee on Estimates on transport aircraft are being considered. We shall send our views on them to the Committee as soon as possible.
    Mr. McMaster: Is my right hon. Friend aware that, in spite of several debates on aviation and defence, there has been no announcement of any aircraft projects, including particularly such projects as the replacement of the Shackleton, and that the Committee on Estimates recommended that there should be better forward planning if redundancy was to be avoided in the aircraft industry?
    Mr. Amery: It is true that the Shackleton has been a versatile aircraft capable of a certain amount of transport work, but it can hardly be regarded as a transport aircraft in itself. We are doing our best to forecast transport development as far ahead as possible, but all foreseeable requirements are met up to the middle of the next decade.
    Mr. Lee: Is the Minister aware that those of us who are keen that the British aircraft industry should be a great success are becoming more and more worried that, despite huge expenditure of public money, we are, apparently, not putting ourselves in a position to ensure that British products are bought and are the best for British aviation? Would the Minister agree that it is necessary to have far closer planning as between the fliers and the makers, with the Government taking a more active interest in what they can have than they are doing now? There seems to be growing in Britain a feeling that at the
    444
    end of the day we have still not proved that we are getting value for money from the great public expenditure which is now entailed.
    Mr. Amery: There is always room for improving the methods by which we approach these problems. The hon. Member would, however, be doing a disservice to the industry if he suggested that its condition is bad. I think on the contrary that it is extremely good, and the co-operation between industry, pilots and the Government is extremely close. No doubt there is room for improvement, but it would be a great disservice to suggest that the situatian is a bad one.
    Mr. McMaster: Is my right hon. Friend satisfied with the forward planning of heavy strategic transport aircraft and that we have sufficient to meet our needs as far ahead as he has suggested?
    Mr. Amery: I am in constant touch on this matter with my right hon. Friends the Minister of Defence and the Secretary of State for Air. They seem satisfied that the requirements are being met.

    T188 Aircraft
    Mr. Lubbockasked the Minister of Aviation whether the decision to cancel the T188 aircraft programme was based on the failure of the aircraft to achieve its designed performance, or on a reassessment of need to investigate the use of steel in the construction of high-speed aircraft.
    Mr. Amery: The reasons for the termination of the T188 programme were given in answer to the hon. Member's Question of 2nd March.
    Mr. Lubbock: Will the Minister confirm that the total cost of the T188 programme was £30 million? Can he say whether equally important information might not have been achieved by the use of our existing supersonic aircraft such as the Lightning, which flies at a speed greater than that achieved by the T188? Further, what plans do the Government have for continued research in hypersonic flight now that this programme has been discontinued?
    Mr. Amery: The hon. Member's figures are quite wrong. The sum spent

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    so far on the project is nothing like as much as £30 million. [HON MEMBERS: "What is it?"] More of the order of £20 million. A good deal of research is being carried out in the direction of hypersonic flight. We could not have got anything like the same experience from the Lightning. The metallurgy of the T188 has been very important and during its construction we have met a number of problems much greater than those involved in a conventional development programme. To expose these problems has been one of the main objects of our research.

    Aviation Fuel (JP4)
    Mr. Lubbockasked the Minister of Aviation if, in view of new evidence pointing to the risks of wide-cut gasoline, JP4, as an aviation fuel, he will propose to the International Civil Aviation Organisation that the use of this fuel should be banned by international agreement.
    Mr. Marten: The attention of the International Civil Aviation Organisation has already been drawn to the British report of 1962 on the subject. Studies of more recent evidence are in hand in the United States. When we have the results we shall consider a further approach.
    Mr. Lubbock: Is it not now virtually certain that the Pan American 707 which was struck by lightning over Maryland on 8th December crashed as a direct result of using this more dangerous fuel? Has the Parliamentary Secretary noticed the suggestion which has been made by Mr. Rickard that we should allow licences to foreign operators flying into this country only if they are prepared to use the safer fuel? Does not the hon. Gentleman agree that this would be a good thing considering that our air Corporations, which use kerosene, are at an economic disadvantage compared with the foreign operators who use JP4?
    Mr. Marten: That is a slightly wider question. The accident to which the hon. Member referred, at Elkton in the United States, in December, is under investigation. It is not yet established—here one must be a little cautious—that kerosene would have been any safer in that accident.

    Short Bros. and Harland
    Mr. McMasterasked the Minister of Aviation whether he will take steps to expedite the commencement of work on new aircraft construction under contracts and subcontracts which have been awarded to Short Bros. and Harland so that temporary redundancies may be avoided and a steady flow of work maintained.
    Mr. McCannasked the Minister of Aviation if he is aware of the impending redundancies at the works of Short Brothers and Harland at Belfast; and what action he is taking to prevent them.
    Mr. Leeasked the Minister of Aviation whether he is aware that one-half of the employees of Short Brothers and Harland will be redundant by 1966; and what is his estimate of the size of their labour force in 1970.
    Mr. J. Amery: I would refer to the statement which I made during the debate on the Consolidated Fund (No. 2) Bill on 19th March. My Department is considering what additional work might be obtained by the company and what action can be taken to reduce the difficulties foreseen.
    Mr. McMaster: With a view to placing further work with the company, in view of the undertaking to which reference has been made, will my right hon. Friend consider, if the price difference is small—10 per cent. or less—placing the work where there is most social necessity for it?
    Mr. Amery: This is something that we have already done in the case of the VC10 for the Royal Air Force and the sub-contracting on the HS681.

    Lulsgate Airport
    Mr. Awberyasked the Minister of Aviation if he is aware of the disquiet of the Bristol, Lulsgate, Airport Committee concerning the hazard to aircraft approaching the airport caused by the erection of the mast 1,624 feet high in close proximity to the aerodrome; if he will re-examine the position in the light of the weather conditions at the airport; and if he will receive a deputation from the committee on this matter.
    Mr. Marten: In considering the proposal by the British Broadcasting Corporation to erect this mast all relevant factors, including weather conditions at Lulsgate Airport were taken into account. My Department decided that the proposal did not offend against the internationally accepted criteria which govern the safeguarding of airfields. I am satisfied that this view is correct. I am, after Question Time, meeting a deputation of hon. Members and local representatives about this.
    Mr. Awbery: I am grateful to the Parliamentary Secretary for agreeing to meet a deputation this afternoon to discuss the matter. When he discusses it with the deputation, will he bear in mind that the Bristol local authority and the chamber of commerce have used very strong language in condemning the erection of this mast, 1,650 ft. high, within six miles of the aerodrome? The Minister's own Department has said that it may not be the right thing and that it may be undesirable to have a mast so near to the airport. Will the Minister consider this matter when he meets the deputation this afternoon?
    Mr. Marten: I hope that the hon. Member will be present. If he is not, I will certainly bear that in mind.

    Confederation of Engineering and Shipbuilding Unions (Correspondence)
    Mr. A. Lewisasked the Minister of Aviation on what date he received a communication from the Confederation of Engineering and Shipbuilding Unions concerning the aircraft industry; what was the nature of this communication; what was his reply; and whether he will make a statement.
    Mr. Amery: I am circulating copies of the correspondence in the OFFICIAL REPORT.
    Mr. Lewis: Is it not the case that this important body has rightly asked for the resignation of the Minister? As this is a wonderful suggestion, will the Minister undertake to act upon it?
    Mr. Amery: No, Sir. I assure the hon. Member that I have rejected that suggestion from the body of men he has in mind. The grounds on which they argued that I might adopt it were entirely mistaken.
    Following are the letters:
    From:
    Confederation of Shipbuilding and Engineering Unions.
    13th March, 1964.
    Dear Minister,
    Representatives of my Executive Council met you on 5th February and discussed with you the present situation of the Aircraft Industry and its future prospects. Generally, you felt we were taking an unduly gloomy view of the industry and you instanced developments which had and were taking place which led you to a more optimistic view as regards the competitive position of the industry and of its future.
    More particularly we referred to the existing uncertainty at that time about military planes and our fears that foreign types might be substituted for British planes which had been developed but not in production waiting on top level decisions.
    Since our meeting on 5th February it was made public that the Government have ordered 50 Phantom fighter planes from the U.S.A. to replace the British P.1154, and 200 helicopters of American design to be built in Italy.
    At the meeting on 5th February in so far as the P.1154 was concerned you told us that a final decision had yet to be taken but that holding contracts were in existence to ensure that progress was not held up; and that so far as the unit light helicopter was concerned, this requirement, which was urgent because of heavy military commitments, had not been foreseen in sufficient time to allow a British type to be designed to meet it. But in any case the requirement involved relatively little expenditure and work and efforts would be made that any solution adopted would provide employment in the United Kingdom.
    We accepted your assurances in good faith and reported on this basis to our full Executive Council and by circular to our affiliated unions and District Committees. Now we have found our original fears realised, and what is more we feel that the decisions for placing orders for the Phantoms and the helicopters must have been known by you at the time you met us.
    When the position was reviewed by my Executive Council at their meeting in York on 12th March grave concern was expressed at the policies of the Ministry of Aviation during the last ten years which has now brought us to a position of becoming dependent upon the United States of America for the design of aircraft. My Executive Council further consider that our representatives at the meeting on 5th February were misled by your assurances and that in the circumstances you should resign.
    H. G. BARRATT,
    General Sec.
    24th March, 1964
    You wrote to me on 13th March about my meeting with representatives of the Confederation on 5th February. I am at a loss to

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    understand how your Committee can suggest that they were misled, and can find nothing in your letter to justify such an allegation.
    You refer in particular to the Minister of Defence's recent statement that we would adopt the Phantom fighter if its proved to be compatible with our aircraft carriers and available on financially acceptable terms. I cannot accept the suggestion that I should have been able to warn the Committee about this decision before it had been taken. When I spoke to your Committee no decision had been taken and as you will see from what the Minister of Defence said, the decision is even now a conditional one.
    It is incorrect to say that the Phantom will replace the British P.1154. Development of the latter as the Hunter replacement is going ahead, and this will bring important design and production work to the industry. What has happened is that we have not seen our way to meeting the Navy's requirement for a Sea Vixen replacement with a variant of the P.1154. It would be extremely costly to develop a separate Sea Vixen replacement for such a limited requirement with no apparent export prospects. On the other hand, the Phantom was already in production, and could be fitted with Rolls Royce engines, thus making a considerable contribution to employment in this country. As you know, the engine content of our aircraft represents around 1/3 of its total value.
    It is also incorrect to say that we have ordered 200 helicopters of American design to be built in Italy. The facts are, as I announced in Parliament on 18th March, that the first 50 light helicopters are to be imported from Italy, and that the balance will be built in this country. Here again we have thus been successful in our aim as stated at the meeting on 5th February to ensure that the solution adopted should, at any rate on the production side, provide employment in the United Kingdom. You will also be aware that Italy represents an important export market for the British aviation industry.
    The view I expressed, which was incorporated in the agreed press notice after the meeting, that "there were good grounds for optimism about the future level of employment" in the British aircraft industry remains valid, particularly in view of the decisions to go ahead with the HS681 and P.1154 projects.
    In all the circumstances I trust that your Committee will now recognise that a great deal has been done by the Government to improve the prospects of the industry and that although there are problems affecting particular factories the general outlook is good.
    I have always been ready to see your Committee and I must therefore express my surprise that, when doubts arose in their minds as to the significance of the recent decisions, they chose to make the kind of public statements they have, rather than suspend judgment until they had talked the matter over with me again.
    JULIAN AMERY.

    Prestwick Airport (Scandinavian Air Services)
    Mr. Millanasked the Minister of Aviation what decision has been made about the number of Scandinavian Airlines' flights to be allowed through Prestwick Airport.
    Mr. Emrys Hughesasked the Minister of Aviation if he will now make a statement on the further negotiations which have taken place with Scandinavian Air Services on the question of landings at Prestwick.
    Mr. Amery: The matter is still under consideration.
    Mr. Millan: Before coming to a final decision, will the Minister bear in mind that there is considerable concern in Scotland about this matter and a strong feeling that the Minister has neglected the effects of his original proposals on Scotland's air communications with Scandinavia, quite apart from the question of the connection between Prestwick and the United States? Will he bear this in mind and ensure that by his decision on this matter he does not prejudice air communications between Scotland and Scandinavia?
    Mr. Amery: I assure the hon. Member that I have not neglected that aspect. I am quite satisfied that my proposals would not interfere with communications between Scotland and Scandinavia.
    Mr. Emrys Hughes: How long is it likely to be before the Minister comes to a decision in this matter? Surely, he is aware that the Scandinavian Governments have intervened with the Foreign Secretary and that the Foreign Secretary is also now considering it. Is the Minister aware that during this interval, disquiet in Prestwick is steadily growing?
    Mr. Amery: The best negotiations, as the hon. Member will be aware, are carried out with patience.
    Sir T. Moore: Is my right hon. Friend aware, as I imagine he is, that there is indeed, as the hon. Member for South Ayrshire (Mr. Emrys Hughes) has just said, great anxiety in Scotland at these proposed reductions in S.A.S. flights to and through Prestwick—not particularly over the damage to S.A.S. but over the

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    damage to Prestwick Airport itself and also to the air industry in Scotland generally?
    Mr. Amery: I can assure my hon. Friend that I have naturally taken all these aspects very much into consideration. I am directly responsible for the operation of Prestwick Airport and it is a point of first consideration in my mind, but I believe that the proposals we have put forward are in the best interests of British aviation taken as a whole.
    Mr. Woodburn: Is the right hon. Gentleman aware that there is an impression that Prestwick is being used as a pawn in some sort of battle between Britain and Scandinavia over things which are not connected with Prestwick, and that this is regarded as an extremely dangerous game from the point of view of the future prosperity of Prestwick? Would he explain just exactly why Prestwick must be used as a target in this battle?
    Mr. Amery: Yes, indeed, and I am sure that the right hon. Gentleman will wish to help me in dispelling any misapprehension of this kind. What has been happening is that S.A.S. flights have been picking up a great deal of the traffic from Scotland and carrying it to the United States—traffic which might otherwise have gone by B.O.A.C. I am sure that the last thing the right hon. Gentleman and his friends north of the Border would want to see would be subsidising S.A.S. at the expense of B.O.A.C.
    Mr. Gourlayasked the Minister of Aviation what representations he has received from Kirkcaldy Town Council regarding the proposed restrictions on Scandinavian Air Services at Prestwick; and what was the nature of his reply.
    Mr. Amery: I received, and duly acknowledged, a letter from the Town Clerk informing me that the Kirkcaldy Council supported the representations that had been made to me by the Prestwick Town Council.
    Mr. Gourlay: Is the right hon. Gentleman aware that two local authorities in my constituency have protested about the proposed restriction on S.A.S. services and that this reflects grave disquiet and resentment among the population of
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    Scotland as a whole about his decision? How does he square a previous Answer—that his decision was taken in the best interests of British Aviation with a view to protecting B.O.A.C.—with the granting of additional facilities to British Eagle to compete with B.E.A. on the Edinburgh and Glasgow services? Will he take into account the enormous trading and commercial interests of Scandinavian countries in Scotland? Is he aware that the Prime Minister told me yesterday that he was giving further consideration to this problem? Will he consult the Prime Minister about this?
    Mr. Amery: I think that the simple answer is that both British Eagle and B.O.A.C. are British airlines and that, therefore, the best interests of British aviation are served by promoting all the different British aviation efforts. The hon. Gentleman and, perhaps the town clerk, are under the misapprehension to which the right hon. Gentleman the Member for Clackmannan and East Stirlingshire (Mr. Woodburn) referred earlier, when I expressed the hope that he would help dispel it north of the Border.
    Mr. Emrys Hughes: Does not the right hon. Gentleman realise the enormous amount of national capital invested in Prestwick? Is he not aware that, right across Scotland, there is grave disquiet? Will he consider coming to Prestwick to find out things on the spot?
    Mr. Amery: I am hoping to visit it shortly, but I am under no misapprehension about the amount of national capital invested in it.
    Mr. Ross: I hope that the right hon. Gentleman is also aware of the amount of national feeling involved. Will he consult his hon. Friend the Parliamentary Secretary and get from him the reports of the various delegations of hon. Members on both sides of the House who have been to see the Parliamentary Secretary to express their concern about the well-being of Scotland as a whole and the particular interest of the area of the country in which Prestwick lies?
    Mr. Amery: It is kind of the hon. Member to suggest that I should consult my hon. Friend, but we are already in very close touch.
    Mr. Lubbock: Can the right hon. Gentleman confirm that there is no suggestion of restricting the "fifth freedom" rights of S.A.S. to fly routes between Prestwick and Scandinavia? Is not he concerned only with the through flights between Scandinavia and the United States which pick up passengers in Scotland? Is not B.O.A.C. perfectly capable of providing all the seats which might be needed by passengers wishing to fly from Scotland to the United States or vice versa?
    Mr. Amery: The hon. Gentleman has expressed the position accurately. We have no wish to restrict in any way flights between Scotland and Scandinavia. Our only objection is to S.A.S. taking more than its fair share of passengers flying from Scotland to the United States and vice versa. The rights which S.A.S. has enjoyed in Prestwick were originally conceded in the period when aircraft were not able to fly direct from Scandinavia to the United States without breaking the journey. The situation has now changed and S.A.S. is exploiting a market which should naturally go to B.O.A.C.

    Britannia Aircraft
    Mr. Milneasked the Minister of Aviation what has been the number of Britannia aircraft sold by the British Overseas Airways Corporation.
    Mr. Marten: British Overseas Airways Corporation informs us that it has so far disposed of seven Britannias.
    Mr. Milne: Is the Parliamentary Secretary aware that if these aircraft which are being sold have a long and safe flying life ahead of them that is a case for their retention by B.O.A.C., and if this is so, does not this represent a hidden subsidy from the nationalised airlines to private airline companies?
    Mr. Marten: B.O.A.C. sells them when it wants to sell them.
    Mr. Fernyhough: Can the hon. Gentleman explain why, if these planes are serviceable and airworthy, they are not good enough for the nationalised industry to operate, but are good enough for private flying?
    Mr. Marten: Because the nationalised Corporation in this case wishes to
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    change over to other aircraft, for various reasons, and sells them to other airlines which wish to operate Britannias. It is a commercial matter.

    Aircraft (Safety Standards)
    Mr. Milneasked the Minister of Aviation if he will introduce legislation to make more effective the safety standards applied to aircraft which are resold, following their use by the nationalised air Corporations.
    Dr. A. Thompsonasked the Minister of Aviation whether he will take steps to make more effective the safety standards applied to aircraft sold by the nationalised air Corporations to other operators; and if he will make a statement.
    Mr. Marten: Under the existing legislation exactly the same safety standards apply for the continuing airworthiness of a transport aircraft, irrespective of whether it is operated by the Corporations or an independent operator.
    Mr. Milne: Is the Parliamentary Secretary aware that many of these are bought by private airlines when they are approaching the end of what is termed their safe fatigue life? Is he further aware that the opinion is held throughout the industry that the private airlines are greatly inferior to the nationalised lines in the maintenance of craft and in their readiness to withdraw or divert machines from service? Will he not consider that this sort of thing needs examination, because there is growing disquiet throughout the industry that private lilies lag behind the nationalised lines in their readiness to divert and land at another field when landing conditions are hazardous at the intended airport? Is he aware of this? Will he give greater examination to this problem than appears to have been given to it by the Ministry in the past?
    Mr. Marten: In answer to the last part of the supplementary question, if an accident occurs involving diversion of a flight it is subject to complete inquiry, and if it is abroad we take part in that inquiry, and give it very careful attention. As regards the last part of the supplementary question, all aircraft, whether they be Corporation aircraft or aircraft belonging to private airlines, have the same safety standards.
    Dr. A. Thompson: Would not the Parliamentary Secretary agree that this is a question of the planes being further advanced in what is called their safe fatigue life? It becomes more important for planes operating in hazardous geographical and weather conditions. I can assure the hon. Gentleman that there is disquiet among pilots and aeronautical engineers about this. Would he start by making inquiries, with information relevant, with the Air Registration Board?
    Mr. Marten: These things are constantly under study by the Air Registration Board itself.

    Phantom II Aircraft
    Mr. Wiggasked the Minister of Aviation on what date the first delivery of Phantom II's will be made to the Royal Navy; and what is the expected date on which deliveries of this aircraft will be completed.
    Mr. Amery: I have nothing to add to the Answer I gave to my hon. Friend the Member for Bournemouth, West (Sir J. Eden) on 18th March.
    Mr. Wigg: Would the right hon. Gentleman be good enough to explain why he is so coy about this? For over a year now it has been dangled in front of the Royal Navy that it would get the P1154. Then at public expense and a great amount of publicity the right hon. Gentleman goes off to the United States and buys the Phantom II. Now he cannot tell us either when we shall get it or what the order is. When are we to be given some relevant information on this matter?
    Mr. Amery: I should have thought the hon. Member would have been the first to wish us to study very carefully all the considerations before we order aircraft, whether foreign or, indeed, British. No commitment will be made until we are satisfied on the technical issues and the costs, and until we have negotiated a satisfactory Government-to-Government agreement.
    Mr. Farey-Jones: In view of that reply, will my right hon. Friend strictly bear in mind the enormous psychological impact on the aircraft industry of the purchase of these Phantoms, and will he undertake and promise to the House that
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    before any such contract is placed every possible avenue of employment in the aircraft industry will be scrutinised first?
    Mr. Amery: We naturally consider the full implications of the Government's decisions, in particular to order the Phantom, on the aircraft industry, and we will see that every possible step is taken to alleviate any difficulties which may arise here. As I have said, there is no commitment yet.
    Mr. Lee: There are very serious technical problems which have not been resolved in the case of the Phantom. Will the right hon. Gentleman realise that when I put a supplementary question a moment or two ago which seemed to annoy him it was precisely this kind of thing that I had in mind, that we are spending huge sums of money, but that when the crucial time comes when we have to make an order, whether for helicopters or the Phantoms, we have to go abroad for it? It is this kind of thing which causes apprehension in Britain.
    Mr. Amery: There are indeed certain technical aspects of the Phantom solution which have not yet been resolved, and I can confirm this, that it will be some months before we are in a position to say whether they can be economically resolved or not. I was only taking the hon. Gentleman to task for running down the British aircraft industry.
    Sir J. Eden: Is it not a fact that a great deal of care was taken in trying to find a joint aircraft between the Royal Navy and the Royal Air Force and that this having failed it appeared that the best alternative to that was the Phantom airframe equipped with the Rolls-Royce Spey engine? If the difficulties can be overcome, is it not right that the Royal Navy should get the best aircraft available?
    Mr. Amery: I would agree with my hon. Friend. The idea of a common aircraft proved to be impracticable. To have developed a special British naval aircraft as a Sea Vixen replacement would have been extremely expensive. If the technical difficulties can be overcome I have no doubt that the Phantom is the best solution. The fact that it will have a Rolls-Royce engine means at least that one-third of the cost is going to British industry, and it may well be that this will

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    have helpful repercussions and consequences in the entire field.
    Mr. Wigg: One can understand the right hon. Gentleman being cautious in a matter of this kind, but how comes it that all these doubts and second thoughts were not made clear by the right hon. Gentleman when for political reasons he came here and made an announcement that he was going to get the Phantom II?
    Mr. Amery: The hon. Member is quite wrong in saying that my right hon. Friend said what he said for political reasons. He needed to say we had a decision of intent before we could seriously embark on negotiations affecting both technical modifications and serious detailed discussions on estimates.

    Airport Development, Yorkshire
    Mr. A. Robertsasked the Minister of Aviation what action he proposes to take on the report of a survey recently published by the Yorkshire Airport Development Association, a copy of which has been sent to him, making certain proposals on airport development in the North-East.
    Mr. Marten: I agree with much of the report which confirms my Department's view that there is no case for a single regional airport for the North-East and Yorkshire Region. We are already assisting financially with the development of Woolsington and are taking over Middleton St. George from the Air Ministry for transfer to the local authorities. We shall be glad to help the local authorities at Hull—with whom we have already been in touch—in any planning or technical problems connected with the proposed civil development at Brough.
    Mr. Roberts: Is the hon. Gentleman aware of the Press reports, obviously authoritative, confirming that there will be two more international airports in the South-East, or around London? Does he realise that the population of the South-East should not be further increased but that there should be a movement to the North? Well he give consideration to the provision of an international airport in Yorkshire?
    Mr. Marten: That has already been considered and it does not fit into the pattern of aviation in this country.
    Mr. Tiley: Will my hon. Friend tell the House how, if we are to have two more international airports within an hour of London, plus a Channel tunnel, we Northerners are to get to the South? Admittedly, I have never found anything worth coming south for except to attend this place but we have to go to and travel from London Airport. In the broad survey of the country's transport, is it not time that some attention was given to Yorkshire and the North-East?
    Mr. Marten: I do not know whether my hon. Friend heard my Answer but mentioned, for the North-East, the development of Woolsington and Middleton St. George. There is also the improvement at Yeadon at the moment, and we are prepared to help Hull with any proposed civil airport developments and technical problems. A substantial effort is being made by the Government to improve communications with the North-East.

    Missiles and Aircraft (Cancelled Projects)
    Mr. Shinwellasked the Minister of Aviation what has been the financial loss sustained by the cancellation of projects concerned with missiles and aircraft since 1952.
    Mr. Amery: I have nothing to add to the answer I gave to the hon. Member for Loughborough (Mr. Cronin) on 17th June, 1963, of which I am sending the right hon Member a copy.
    Mr. Shinwell: I have not seen that Answer. Can the right hon. Gentleman tell me the total? Can he also say whether, since last June, there have been other cancellations of projects? Who is responsible for cancellations? Is it the Ministry? If so, are those responsible to be surcharged?
    Mr. Amery: I have not got the total here. The figures are set out in a table which the right hon. Gentleman will be able to see in the circulated statement. The decision is, of course, taken by the Government as a whole. I am aware of no cancellations since June.
    Mr. Shinwell: If the right hon. Gentleman refers me to an Answer given previously, presumably he has that Answer

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    before him. I am merely asking for the total amount. Has he not that in front of him?
    Mr. Amery: The Answer does not give the total but lists each item. I would not wish to weary the House by counting up the sums listed.
    Sir J. Eden: Can my right hon. Friend give any comparison with the experiences of other countries regarding the cancellation of projects like this? Would not he agree that it is insufficient merely to consider cancellation of projects? Should we not also have regard to the value of our exports, the value to developments in other industries and also the value of all those projects—both missiles and aircraft—which are in service? Would not this give one a much more balanced account of the success of the British aviation industry?
    Mr. Amery: The proportion of cancellations in this country has been considerably smaller than in the United States. When the right hon. Member for Easington (Mr. Shinwell) asked for certain detailed information it never occurred to me that he was criticising cancellations. It is much better to begin projects and cancel some than not begin at all.
    Mr. H. Wilson: Since the right hon. Gentleman has not got the total sum with him and apparently cannot tot up the answer, would it help if I informed him that a simple tabulation by arithmetical methods gives a figure of £239 million?
    Mr. Amery: The figures advanced by the right hon. Gentleman's colleagues in the last aviation debate make me hesitate to accept his now.
    Mr. Lee: Following the answer to my right hon. Friend the Member for Easington (Mr. Shinwell), is it not the case that since last June we have had the cancellation of the T188 at a cost estimated at £20 million?
    Mr. Amery: This is another typical example of the hon. Gentleman's characteristic tendency to misrepresent the facts. We have not cancelled T188. All we have done is to terminate the programme. [Laughter.] What we have done is to terminate the programme somewhat earlier than was previously
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    foreseen, but not before we had learned very many lessons from it. It is all very well for hon. Members to laugh, but there is no question of cancellation. Our decision has been based on the fact that further expenditure would not pay off. The expenditure so far incurred has given a reasonable return.
    Mr. Shinwell: On a point of order. Might I give you notice, Mr. Speaker, that I might catch your eye on the Adjournment tomorrow to enable the right hon. Gentleman to give the full amount after he has inspected the details?
    Mr. Speaker: Yes. I have received notice. I can give no encouragement.

    Airfield, Sculthorpe
    Mr. Bullardasked the Minister of Aviation if he will make a statement on the possibilities of using the now disused American air base at Sculthorpe, Norfolk, for purposes in connection with civil aviation.
    Mr. Marten: I understand that the future of Sculthorpe as a military airfield has still to be determined, so that it may be premature to be considering its possible civil rôle. However, I can say that it would have no place as a major intercontinental airport if Stansted is selected as the site for the third London Airport.
    Mr. Bullard: While I appreciate all the difficulties of using this base for civil aviation purposes, may I ask whether my hon. Friend is aware that the potential closing of the base is likely to have an enormous effect on the area and that the size and scope of the installations are vast and that it seems a great pity that some future profitable use cannot be found for them?
    Mr. Marten: That is the very point which has not yet been decided, but if its use as a military airfield is discontinued it is up to the local authorities, in consultation with us, to consider its future use.

    Phantom Aircraft (Airframes)
    Mr. Croninasked the Minister of Aviation what consideration he has given to having the McDonnell Phantom aircraft airframes manufactured under licence in the United Kingdom, instead

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    of buying the airframes directly from the United States.
    Mr. Amery: This is one of a number of issues which are currently under consideration in connection with the possible purchase of Phantom aircraft.
    Mr. Cronin: Will the right hon. Gentleman bear in mind that this order has been a heavy blow to the prestige, morale and well-being of the British aircraft industry? As it will involve the expenditure of between probably £100 million and £200 million, would not some of the economic effects be mitigated if it were made under licence?
    Mr. Amery: As the hon. Gentleman is already aware, more than one-third of the total sum involved will be placed with Rolls-Royce. As I said, the question of assembly over here is one of the matters now being considered.
    Mr. McMaster: Will my right hon. Friend also consider the re-engining of this aircraft by the British aircraft industry?
    Mr. Amery: It is to be engined by Rolls-Royce.

    Scotland (Air Transport Requirements)
    Dr. A. Thompsonasked the Minister of Aviation whether he will set up a small committee to investigate Scotland's requirements in air transport over the next 10 years.
    Mr. Marten: No, Sir. I do not think it is necessary to set up a special committee for this purpose.
    Dr. Thompson: Will not the hon. Gentleman bear in mind that any plans for the industrial expansion of Scotland must be matched by provision for improved air facilities, better services within the United Kingdom and direct links with Europe, better tourist facilities and links with overseas countries? In the light of that, will he have an over-all look at the problems of Scotland and perhaps consider the possibility of setting up a Scottish air travel authority?
    Mr. Marten: At present there are the Highland Transport Inquiry under Lord Cameron, which has made an investigation, the Committee of Inquiry into the Scottish Economy under Sir John Toothill, the Scottish Council, the
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    Highland Transport Board and the Scottish Advisory Committee for Civil Aviation, all of which deal with this subject.
    Mr. Manuel: What are the considered views of the Minister of Aviation and the Secretary of State for Scotland, who received a report from B.E.A. a year ago about the Scottish internal services? Have they reached a decision on that matter yet?
    Mr. Marten: That was a question of the Highlands and Islands. In the White Paper it is clearly stated that these internal services will be maintained as social services.
    Dr. Thompson: The hon. Gentleman mentioned the Toothill Report. Is he aware that it was made three years ago and condemned the rate of growth of air travel in Scotland as inadequate to the new needs of both industry and tourism? Will the hon. Gentleman read that Report and do something about it?
    Mr. Marten: I was only saying that this was one of the reports studying the problem and that setting up a further small committee would not carry it much further.

    Lang Report
    Mr. Leeasked the Minister of Aviation on what date the Lang Report will be published.
    Mr. Amery: I cannot, at this stage, give a date for publication.
    Mr. Lee: Is the right hon. Gentleman aware that two months have elapsed since the Lang Committee was set up? We know that the Public Accounts Committee is considering this matter, but will the right hon. Gentleman now assure us that we can expect the Lang Committee to report at any rate within the next month?
    Mr. Amery: As I said, I am not in a position to say what the date will be.
    Mr. Gordon Walker: Will the right hon. Gentleman give an undertaking that the report will be published before the General Election?
    Mr. Amery: Rightly or wrongly, it is not I who takes the decision about the election.

    B.O.A.C. (Corbett Report)
    Mr. Croninasked the Minister of Aviation if he will give further consideration to publishing the Corbett Report on the British Overseas Airways Corporation having regard to the recent disclosure of the contents of this Report to the British Overseas Airways Corporation.
    Mr. Amery: No, Sir.
    Mr. Cronin: Has not this Report now received widespread unofficial circulation and even appeared in the Press? Can the right hon. Gentleman reassure the House that his refusal to publish the Report is not influenced by the circumstances first that the Report contains no justification for his changes in the B.O.A.C. Board and, secondly, indicates that B.O.A.C. received some very improper Ministerial interference in its presentation of its accounts?
    Mr. Amery: As I have said, I am not prepared to publish the Report and it would therefore be a waste of time of the House to try to discuss what its contents are.

  ROADS

    Huntingdon By-pass
    Mr. Rentonasked the Minister of Transport when it is proposed to start building the Huntingdon by-pass.
    The Parliamentary Secretary to the Ministry of Transport (Mr. T. G. D. Galbraith): The scheme will be considered for inclusion in the extension of the trunk road programme to 1968–69.
    Mr. Renton: Is my hon. Friend aware that since I started pressing for this bypass more than eight years ago the congestion in Huntingdon has been getting worse and worse and that to have to wait another four or five years is a serious matter in a fast developing town? Will he ask his right hon. Friend to consider this matter again and make a further announcement about it at a later date?
    Mr. Galbraith: What I can say is that naturally we will consider as sympathetically as we can including the scheme in the next extension of the
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    rolling programme, but whether it succeeds in being included will depend on the competition from other similar schemes.

  SHIPPING

    The Hartlepools
    Commander Keransasked the Minister of Transport whether he has now approved the plans for the modernisation of the coaling staithes in the port of Hartlepool.
    Mr. T. G. D. Galbraith: The British Transport Docks Board is still in discussion with the National Coal Board on the volume of coal likely to be shipped through the Hartlepools in the future. In consequence the plan for the modernisation of the coaling staithes has not yet been submitted to my right hon. Friend.
    Commander Kerans: This was brought to the attention of the then noble Lord more than a year ago when he came to the North-East, when it was said that this was one of the items which would help to improve the port and thus increase communications and attract industry to the area. Why has nothing been done for so long?
    Mr. Galbraith: My hon. and gallant Friend probably knows that the Docks Board has done a great deal of preparatory work on this, but before it can come to a final decision, it must know what the Coal Board's requirements are, and the Coal Board is now estimating the extent of its future shipment requirements throughout the whole of the North-East.
    Commander Keransasked the Minister of Transport what plans the Docks Board has submitted to him for the future development of the port of Hartlepool.
    Mr. T. G. D. Galbraith: I am advised that, apart from the scheme for new coal shipment facilities the Board has no plans at present for major developments.
    Commander Kerans: Is it not high time that it did? Not so long ago it was turning away ships from the port because it did not have sufficient alongside berths or deep-water berths for

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    unloading timber. Will my hon. Friend look into this again as a matter of urgency?
    Mr. Galbraith: The Docks Board is looking into this, but it considers that present facilities are generally adequate for the immediate future, with the exception of the coal facilities which I have mentioned.

    QUESTIONS TO MINISTERS
    The following Question stood upon the Order Paper:
    Mr. HUGH DELARGY: To ask the Lord Privy Seal if he will move to appoint a Select Committee to consider the desirability of setting up a plaque in Westminster Hall in memory of Sir Thomas More.
    Mr. Speaker: Mr. Bevins—statement.
    Sir T. Moore: On a point of order, Mr. Speaker, may I direct your attention to this Question and ask whether in your opinion any mistake has been made in the spelling of the surname?
    Mr. Speaker: Westminster appears to be spelt normally.
    Mr. Delargy: As this Question is in my name, and contains the words "in memory of", may I draw attention to the fact that, notwithstanding appearances, the hon. Member for Ayr (Sir T. Moore) is not yet dead?
    Mr. Speaker: I am inclined to think that the transfer of the Savings Bank would be a healthier topic.
    Mr. Emrys Hughes: Nobody would ever associate the hon. Member for Ayr (Sir T. Moore) with Utopia.

POST OFFICE SAVINGS BANK (LOCATION)
The following Questions stood upon the Order Paper:
Mr. CHARLES GREY: To ask the Postmaster General if he will now make a statement on the transfer of the Post Office Savings Bank out of London.
Mr. TIMOTHY KITSON: To ask the Postmaster General if he will make a statement on the new site of the Post Office Savings Bank.
Dr. JEREMY BRAY: To ask the Postmaster General whether he will now announce the future location of the Post Office Savings Bank.
The Postmaster General (Mr. Reginald Bevins): With your permission, Mr. Speaker, and that of the House, I will now answer Questions Nos. 98, 99 and 101 together.
Following the Government's general acceptance of the Fleming Report the decision was taken to move the Post Office Savings Bank to a location out of London. This is an organisation which, technically and operationally, it is possible to move a long way from London.
The Government have considered many locations and has now decided that the national interest lies in moving the Bank to Glasgow.
Mr. Grey: While it is generally accepted that there will be great delight in Glasgow over getting this Department, may I ask the right hon. Gentleman whether he is aware that the people on Tees-side will be bitterly disappointed? May I also ask him what regard he has had for the staff side in this transfer, because it has declared itself wholeheartedly in favour of going to Tees-side in any case? Why did the right hon. Gentleman go through the paraphernalia of seeking the views of the staff side about where this Department should go? What part has the Prime Minister played in all this? I ask that because, politically, this decision stinks.
Mr. Bevins: I have seen the Staff Association on at least two occasions, and there is no doubt that the Civil Service Clerical Association, which represents a majority of the staff, has as the hon. Gentleman said, felt a strong preference for Tees-side. Great weight has been given to the views that have been expressed to me, but the paramount consideration here must be the national interest, and that is why it has been decided to send this Department to Glasgow.
Mr. Kitson: Will my right hon. Friend bear in mind that there will be considerable disappointment on Tees-side because of that reply? Will my right hon. Friend

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convey to his colleagues the claims of Tees-side when any other Government Departments are moved from London?
Mr. Bevins: Yes, Sir. There will be disappointment both on Tees-side and on Merseyside, but I assure my hon. Friend that the Government are not insensitive to the claims of the North-East. Indeed, the Post Office itself is in course of moving the Savings Certificate Division to Durham, where about 2,000 people will be employed. There are also two or three other very much smaller Civil Service units which are available for dispersal to the North. In choosing these locations we shall give special consideration to places that need additional employment.
Dr. Bray: May I ask the right hon. Gentleman whether he is aware that on Tees-side this will be regarded as a blow below the belt? Can he say what is the national interest in the matter of diversification in view of the fact that the proportion of clerical jobs on Tees-side is substantially lower than in any of the other areas considered?
Mr. Bevins: It is true that clerical employment on Tees-side is relatively low, but I think that the principal factors to which the House ought to have regard are, first, the fact that unemployment in terms of numbers is much greater in Glasgow than on either Tees-side or Merseyside, and secondly, that the rate of juvenile unemployment there is also greater.
Mr. Maclay: Is my right hon. Friend aware that his statement will give great satisfaction to everyone who is interested in achieving a better balance of employment opportunities throughout the country, and that it will give particular satisfaction north of the Border? Is my right hon. Friend further aware that those members on the staff of the Savings Bank who move to Glasgow in due course will receive the warmest possible welcome, and will find that it is an extremely friendly city?
Mr. Bevins: I agree with my right hon. Friend.
Mr. Ross: While appreciating the disappointment of Members from the
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North-East, may I express the pleasure of hon. Members on this side of the House who have pressed for this decision, without a voice being raised from the other side?
Will the right hon. Gentleman draw to the attention of the Government the fact that we welcome this belated concern, in the national interest, for the well-being of the neglected areas of the North? Will he speed on the Government during their remaining days in office to disperse further office accommodation and headquarters from London?
Mr. Bevins: I thank the hon. Gentleman for his rather grudging appreciation. I should like to make it clear that there has been no lack of voices raised on this side of the House in support of Glasgow.
Sir K. Thompson: Does not my right hon. Friend agree that that last question is evidence of the fact that he will get little credit from Scotland for doing this, and that the Post Office staffs who are to be denied the pleasure of living and working on Merseyside will find it hard to understand how he arrived at that decision? Will my right hon. Friend do what he can to see that the remaining staffs of the Post Office that are to be moved from London are sent to Merseyside?
Mr. Bevins: I should be the last person to discourage people from going to Liverpool or Merseyside. I assure my hon. Friend that the Government are acutely conscious of the needs of our constituencies.
Mr. Bottomley: May we have an assurance that this case has been decided entirely on its merits? Is it not unfortunate for the North-East that the right hon. Member for Bromley (Mr. H. Macmillan) is no longer Prime Minister?
Mr. Shinwell: On a point of order. In view of the unsatisfactory reply from the Postmaster-General, I beg to give notice that I shall raise the matter on the Adjournment at the earliest opportunity.

BUSINESS OF THE HOUSE
Mr. H. Wilson: May I ask the Leader of the House whether he will state the business of the House for the first week after the Adjournment?
The Lord Privy Seal (Mr. Selwyn Lloyd): Yes, Sir. The business for the first week after the Adjournment will be as follows:
TUESDAY, 7TH APRIL—Remaining stages of the Police Bill, the Continental Shelf Bill [Lords], and the Tenancy of Shops (Scotland) Bill, and, if there is time, the Income Tax Management Bill and the Emergency Powers Bill.
WEDNESDAY, 8TH APRIL—Committee stage of the Resale Prices Bill.
THURSDAY, 9TH APRIL—Housing Bill: Progress with the remaining stages.
FRIDAY, 10TH APRIL—Private Members' Bills.
Mr. Jay: While welcoming the return of the Leader of the House after his disappearance last night, may I express to him our thanks for affording us the opportunity this side of the Easter Recess to put down a number of important new Amendments to the Resale Prices Bill?
Mr. Lloyd: I am not sure whether I would be in order on commenting on the first part of that question, but I heard a good deal more of the debate than did either the Leader or the Deputy-Leader of the Opposition.
Mr. M. Stewart: Will the Leader of the House say whether the Government will find time for a debate on the South-East Study?
Mr. Lloyd: Certainly not the week after we come back.
Mr. Emrys Hughes: Will the Prime Minister give consideration to the proposal that the proceedings of the Committee of Privileges should be televised?
Sir C. Nicholson: Has my right hon. and learned Friend any news now about the question of Statutory Instruments?
Mr. Lloyd: Not today.
Mr. Lipton: So that the matter may be disposed of as quickly as possible, will the Leader of the House say whether the Committee of Privileges proposes to sit during the Easter Recess, so that the House may have its report as soon as possible?
Mr. Lloyd: It is not for me to say what the Committee of Privileges will do. In fact, a meeting of the Committee is being held at four o'clock this afternoon.
Mr. Prentice: Can the right hon. and learned Gentleman say when we shall have a debate on the Government White Paper on the Compensation for Victims of Crimes of Violence? Is he aware that those who have been trying to legislate on this subject for four and a half years wish to congratulate the Government on their belated conversion to our idea?
Mr. Lloyd: I am aware of the fact that the House may wish to have a debate on this matter, and I will consider it.
Mr. Woodburn: The Leader of the House usually intimates the provisional business for the Monday of the week following that in respect of which he announces business. Is he likely to do that today, or is he departing from that procedure?
Mr. Lloyd: I thought that the business for Monday, 13th April, seemed quite a long way off.
Mr. Fernyhough: Having regard to the fact that only limited progress has been made with the Resale Prices Bill, and that only one day of the week when we come back will be devoted to it, is this a sign of the Government's intention to drop it?
Mr. Lloyd: No. Today will be devoted to the Bill, and I expect rapid progess.

MEMORIAL TO PRESIDENT KENNEDY
The Prime Minister (Sir Alec Douglas-Home): With permission, I will make a statement about the memorial to President Kennedy.

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I have now received the report of the Committee under the chairmanship of Lord Franks, and I will, with permission, circulate it in the OFFICIAL REPORT. I have consulted the right hon. Gentlemen the Leader of the Opposition and the Leader of the Liberal Party. We all accept the Committee's recommendations.
The Committee proposes that the memorial should take the form, first, of an acre of Runnymede, laid out simply, with a simple plinth and steps, which should be given in perpetuity to the United States in memory of President Kennedy. The second part of the memorial proposed by the Committee is a scholarship fund for young men and women from the United Kingdom to go, as undergraduates or graduates, some to Harvard University or Radcliffe College, some to the Massachusetts Institute of Technology.
The Government are deeply grateful to Lord Franks and the members of his Committee for the care with which they have examined all the proposals brought to their attention and we feel that the recommendations taken together will provide a worthy memorial.
Both parts of the proposal will require consultations with various authorities and bodies in this country and the United States and these will be undertaken.
It seems desirable that the task of giving effect to the memorial should be supervised by a small Committee. I am glad to be able to tell the House that Sir Roger Makins has accepted my invitation to be the Chairman of this Committee and that the United States Ambassador in London and Sir Humphrey Mynors, the late Deputy Governor of the Bank of England, have generously agreed to serve on it.
I am also glad to be able to inform the House that the Lord Mayor of London has most kindly agreed to make the President Kennedy memorial the object of a Lord Mayor's appeal. I am sure that this generous offer by the Lord Mayor of his time and energies will assist the whole nation in raising a worthy memorial to the late President.
Hon. Members: Hear, hear.
Following is the report of the Committee:
Dear Prime Minister,
I am writing as Chairman of the Committee which you set up to consider what form the British memorial to President Kennedy should take. This letter contains the recommendations of the Committee.
You told Parliament on 5th December that, while public opinion was being given an opportunity to express itself on the tragedy of the assassination of President Kennedy, you were considering how best to facilitate discussion about the form of a British memorial to him; and you arranged consultations between the parties. You also told Parliament that Her Majesty the Queen had been graciously pleased to express her wish to be personally associated with whatever proposal might be decided upon.
You announced on 21st January the constitution of this Committee. We have held four meetings and a sub-committee has held a further two. We have received about 150 letters, nearly all of which reached us by the middle of February; few have come since then. We have considered every one. We wish to express our thanks to all who have helped us in this way.
We have had the privilege of the interest and counsel of Her Majesty the Queen, who received me as the representative of the Committee and discussed with me a number of ideas which we had formed in the light of the suggestions before us. I have visited Secretary of State Dean Rusk, Mr. Robert Kennedy and others in the United States and have had similar discussions with them; and I have had the honour to be received by Mrs. Kennedy, whose wishes we particularly desired to consult.
We have founded our recommendations on these consultations and on our examination of the many particular proposals before us. Trying to catch the spirit which pervaded these proposals, various though they were in content, and to interpret the general feeling of the country, we have sought for President Kennedy a living memorial in the service of men and women, including a permanent physical presence and infused with an imaginative quality which would always evoke the memory of his outlook and achievements.
President Kennedy gave a voice to the heritage which is enshrined for us in Runnymede: we propose that an acre of Runnymede, laid out simply, with a simple plinth and steps, should be given in perpetuity to the United States in memory of him.
This would be at the centre of our memorial. But it would not be the whole memorial. It would be completed by a link with the influences of his home country and of the world of thought and action which helped to mould his mind: we propose a scholarship fund for young men and women from the United Kingdom to go, as undergraduates or graduates, some to Harvard University or Radcliffe College, some to the Massachusetts Institute of Technology. President Kennedy was particularly interested in bringing the two great disciplines of traditional humane studies

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and modern technology into fruitful combination and making their strength effective in the activities of government and the direction of world affairs. The scholarships would be awarded within these fields of knowledge and thereby contribute, as we hope, to the advancement of his idea. The scholars would come from all over Britain, chosen on some regional sub-division of the country.
We make both parts of our proposal as a unanimous recommendation. The first part speaks for itself. We have chosen the second part because it relates to youth; Boston was President Kennedy's home, Harvard his university; and at Cambridge, Massachusetts, the Kennedy family are providing the John F. Kennedy Memorial Library. It is a fittting tribute to President Kennedy's work for international understanding that a succession of young men and women from our country should be given an opportunity to live and work for a period in this environment.
I enclose with this letter a list of the members of the Committee.
Yours sincerely,
(Sgd.) OLIVER FRANKS.
Members
The Rt. Hon. The Lord Franks, P.C., G.C.M.G., K.C.B., C.B.E. (Chairman).
The Rt. Hon. The Viscount Chandos, P.C., D.S.O., M.C.
The Rt. Hon The Lord Evershed, P.C., F.S.A.
The Rt. Hon. The Lord Mayor of London (Alderman C. James Harman).
The Rt. Hon The Lord Provost of Edinburgh (Mr. Duncan M. Weatherstone, M.C., T.D.).
The Rt. Hon. The Lord Mayor of Belfast (Councillor W. Jenkins, J.P.).
The Rt. Hon. The Lord Mayor of Cardiff (Alderman Charles A. Horwood, J.P.).
The Viscount Harcourt, K.C.M.G., O.B.E.
Sir Roger Makins, G.C.B., G.C.M.G.
Sir Philip de Zulueta.
Dame Margo: Fonteyn de Arias, D.B.E.
Lady Jackson.
Mr. Victor Feather, C.B.E.
Mr. John Freeman, M.B.E.
Dr. T. Lupton.

NEW TOWNS (No. 2)
3.45 p.m.
Mr. Martin Maddan: I beg to move,
That leave be given to bring in a Bill to provide that orders designating new town areas or extensions thereof shall be subject to annulment by either House of Parliament.
My opposition to the expansion of Stevenage over the motorway by-pass has caused me to examine carefully the procedure for designating new towns and, in particular, the procedure by which the Minister makes an order. But Stevenage is only incidental to the problem dealt with by my Bill, if the House grants my right hon. Friend, my hon. Friends and myself leave to bring it in. I want to acknowledge the courtesy of my right hon. Friend the Minister of Housing and Local Government in letting me know that, unfortunately, he cannot be present at this moment.
A designation order is a most important matter, not only to the locality concerned but to the whole region in which the new town is to lie. If the Minister cannot convince Parliament about it he will not be able to convince local opinion about it, either. Therefore, the establishment, or enlargement, of a new town will be an act of bureaucracy and not of democracy. As a supporter of the new town idea I regard this as a pity.
There is no Parliamentary control over designation orders other than that the Minister, as a Member of Parliament, is responsible to Parliament in a general way. What the New Towns Act, 1946, says—and it comes straight to the point, in Section 1(1)—is:
"If the Minister is satisfied, after consultation with any local authorities who appear to him to be concerned, that it is expedient in the national interest that any area of land should be developed as a new town by a corporation established under this Act, he may make an order designating that area as the site of the proposed new town."
Schedule 1 provides that if there are objections there must be a public local inquiry. That is all there is to that procedure.
In 1946, Parliament was clearly not fully alert to the need to retain some degree of supervision over the exercise
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of delegated legislation. The question of these orders being subject to Parliamentary control, either under the affirmative or negative Resolution procedure, was never once raised during the passage of the Bill, either in this House or another place.
The nearest that we came to the subject was when, in another place, the noble Lord, Lord Selkirk, suggested that the Minister should, on completion of the inquiry, lay before Parliament a White Paper giving the reasons for his proposals. Presumably, the object was that those proposals could then be debated. But the noble Lord withdrew his suggestion on receiving from the Government an assurance that any point or objection could be raised at the inquiry, local or otherwise. There has been some change in our procedure since those days. Nowadays the Minister issues an explanatory memorandum when he lays the draft order, and the representative of his Ministry attends the local inquiry to explain the Ministry's point of view.
The Minister, in deciding whether to go ahead, considers what has been said at the inquiry in an administrative and not a judicial or quasi-judicial capacity. When Franklin and others challenged the original Stevenage designation order in the King's Bench Division, the judge ruled that the Minister
"did not consider the question: 'Aye or No should the Order be confirmed?' with an open mind, but that he meant to confirm it whatever the force of the objections might be."
The judge added:
"This, in my judgment, involves a denial of natural justice."
This is what can happen.
But the Minister appealed, and, finally, the House of Lords ruled that whether or not the Minister had been impartial was completely irrelevant. That may be a surprise to some hon. Members. This is what Lord Thankerton said in giving his judgment:
"In my opinion, no judicial, or quasi-judicial, duty was imposed on the respondent, and any reference to judicial duty, or bias, is irrelevant in the present case. The respondent's duties under Section 1 of the Act and Schedule 1 thereto are, in my opinion, purely administrative…"
This is, in fact, how the thing is done.

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It is pertinent here also to quote what the Master of the Rolls said in a parallel case, Robinson v. the Minister of Town and Country Planning:
"How can this Minister, who is entrusted by Parliament with the power to make or not to make an executive order according to his judgment, and acts bona fide…be called upon to justify his decision?… Such justification, if it is to be called for, must be called for by Parliament…"
At present, Parliament cannot call for the justification of these designation orders. I wish to contrast for hon. Members the position of new town designation orders, where there is no Parliamentary control at all, as I have said—even when the local authorities concerned object—with the position of other forms of compulsory development.
Under the Town Development Act, 1952, if a receiving district does not agree to a proposal, but the Minister, nevertheless, decides that it should be proceeded with, his order must be approved by each House of Parliament under the affirmative Resolution procedure. Perhaps I may draw the attention of my hon. Friend the Parliamentary Secretary to the Ministry of Housing and Local Government to that—the affirmative Resolution procedure. Under the Housing Act, 1957, which is mainly to do with slum clearance, if the Minister decides to compel a local authority to carry out certain developments against its will, the order is subject to parliamentary approved under the negative Resolution procedure.
The Bill which I seek to introduce is very modest. It would merely make designation orders subject to the negative procedure. This is because, if there is but little substantial opposition to a scheme, I do not wish to take up Parliamentary time with it.
It may be said by some hon. Members that the 40 days during which a designation order is subject to a negative Resolution will prove an unacceptable waste of time in getting a new town started. In reckoning this period of 40 days, no account is taken of any time during which Parliament is prorogued or dissolved, or during which both Houses adjourn for more than four days. In this way a short Recess may add on a couple of weeks to the 40 days, making perhaps two months in all.
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As to the long Summer Recess, I do not think that this is relevant, because, in practice, I am certain that a Minister would take care to hasten the lengthy procedure leading up to the laying of a designation order, if there were any danger of it running into the Summer Recess. He would see that it was laid by mid-June, so that the 40 days would have expired before the Summer Recess began.
What can happen during this period of perhaps a couple of months in which a designation order is subject to annulment by Parliament? I will give two reasons why this period cannot be considered as time wasted. First, the validity of the designation order can, in any case, be challenged in the High Court at any time during the first six weeks after it has been made. Secondly, the first task of the Minister, after he has made an order, is to appoint the members of the new town development corporation. In doing this he has to consult the local authorities concerned. This must take up much, if not all, of the 40 Parliamentary days. Before it can do anything, the corporation has to select its staff. All this can go on while the designation order is subject to annulment.
For these two reasons it is inconceivable, to my mind, that making designation orders subject to Parliamentary control will, in practice, lead to any material delay in developing a new town. I therefore commend the Motion, which provides that orders designating new town areas, or extensions thereof, shall be subject to annulment by either House of Parliament, as one which, if I am given leave to bring in my Bill, will enable Parliament to do its job. I ask the House for leave to bring it in.
Question put and agreed to.
Bill ordered to be brought in by Mr. Maddan, Sir D. Walker-Smith, Mr. Mason, Lord Balniel, Mr. Gardner, Mr. Gough, Sir H. Legge-Bourke, Mr. Graham Page, Mr. Temple, Mr. van Straubenzee, and Mr. Wingfield Digby.

NEW TOWNS (No. 2)

  NEW TOWNS (No. 2)
  Bill to provide that orders designating new town areas or extensions thereof shall be subject to annulment by either

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  House of Parliament, presented accordingly, and read the First time; to be read a Second time upon Friday, 10th April, and to be printed. [Bill 118.]

  OFFICIAL REPORT
  Mr. Warbey: I wish to raise a point of order, Mr. Speaker, in connection with the printing of the OFFICIAL REPORT. In accordance with the usual practice, the copy of the OFFICIAL REPORT which is available to hon. Members today concludes with the proceedings as they were at about 10.30 p.m. last night—
  Mr. Speaker: Order. The hon. Member is too late, if he is talking of yesterday's OFFICIAL REPORT.
  Mr. Warbey: With great respect, Mr. Speaker, you have not heard the point which I wish to make. It is that I wish to ask you, Sir, as the representative of this House, to take steps to facilitate, on behalf of the House, the business of the House in Committee; which can be done, I should have thought, without any very great difficulty or any great technical objection. The position is that we shall shortly be going into Committee on the Resale Prices Bill and will be engaged in discussing a number of Amendments which have been tabled.
  The discussion of those Amendments, and the attitude which hon. Members take towards them, must be very much influenced by what has happened during the previous proceedings of the Committee, particularly as it so happened, as hon. Members are aware—the whole House is now aware, from the Votes and Proceedings, although not from the OFFICIAL REPORT, and you, Sir, are aware—that last night, some time after 10.30 p.m., the House divided on an Amendment to the Bill, and that 203 hon. Members supported that Amendment. We also learn from the official proceedings that 204 hon. Members opposed the Amendment.
  In those circumstances, where there is a very close division of opinion about a matter of primary importance—and this was an Amendment which cut right at the heart of the Bill—it is generally regarded by the common practice of the House in Committee that statements
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  made by the spokesman of the Government at that time—in this case, by the Secretary of State for Industry, Trade and Regional Development and President of the Board of Trade—and by the acting Leader of the Opposition, and by other hon. Members—such as the hon. and gallant Member for Buckingham (Sir F. Markham) and the hon. Member for Putney (Sir H. Linstead)—concerned with the Amendment in question; that the statements made at that time, or subsequent to such a vote, are of considerable importance in regard to the future proceedings in respect of the Bill. For example, it is usual for the right hon. Gentleman in charge of a Bill to give some undertaking about the steps the Government propose to take to meet the wishes expressed by hon. Members in the Committee.
  It will, I submit, be quite impossible for us, when we go into Committee, to consider the rest of the Bill properly and decide how we shall speak and vote on the Amendments now tabled unless we are in possession of a verbatim report of yesterday's proceedings. I am aware that there may be technical difficulties, but I should have thought that by this time the printers of the OFFICIAL REPORT would have had the full verbatim report of the proceedings of yesterday's sitting of the Committee already set up in type, ready to be run off.
  I should like to ask you, Mr. Speaker, whether you could make arrangements with the printers of the OFFICIAL REPORT for them to run off sufficient copies of yesterday's proceedings for distribution to hon. Members, who can have them in their possession when considering the Bill this afternoon.
  Mr. Speaker: Of course, I shall inquire about the technical possibilities, but I really could not hold out much hope. As the House knows, HANSARD and the Stationery Office really do a most wonderful job—[HON. MEMBERS: "Hear, hear."]—and put the OFFICIAL REPORT before us as quickly as they can. I venture to think that the hon. Member's suggestion might be asking a good deal, but, of course, as a servant of the House, I will find out what can be done. Of course, they were giants in the old days, but they did manage somehow until 1909, when there was not an OFFICIAL REPORT at all.

ORDERS OF THE DAY

  RESALE PRICES BILL
  Considered in Committee [Progress, 24th March].
  [Sir WILLIAM ANSTRUTHER-GRAY in the Chair]

  RESALE PRICES BILL

    Clause 2.—(PROHIBITION OF OTHER MEASURES FOR MAINTAINING RESALE PRICES.)
    4.0 p.m.
    The Chairman: The first Amendment to be moved is No. 18, in page 2, line 31, to leave out "exempted goods" and to insert:
    "registration, to the powers of the Restrictive Practices Court thereunder".
    Mr. William Yates: On a point of order, Sir William. I would be grateful if I could draw your attention, and that of the Committee, to column 194 of the OFFICIAL REPORT dated 24th March. I realise, Sir William, that you cannot always hear everything that goes on in the Chamber, but when I saw these words in print this morning I thought that I had better refer to them.
    The hon. Member for Nelson and Colne (Mr. S. Silverman), delivering himself of a great address to the Committee on 23rd March, concluded with the following words:
    "In my political lifetime I have".—[OFFICIAL REPORT, 23rd March, 1964; Vol. 692, c. 194.]
    The Chairman: Order. The hon. Member will be asking more of me than I am authorised to do if he asks me to consider words spoken in a previous debate. It is quite clearly laid down that the Chair—and that refers either to Mr. Speaker or to the occupant of the lower Chair—cannot entertain a complaint regarding words spoken in the House or in Committee unless attention is drawn to those words at the time. It would be without my capacity to consider a point regarding words used previously.
    Mr. George Wigg: In order to help the Committee, Sir William, may I repeat the words? I say that they are true—
    The Chairman: Order. The hon. Member for Dudley (Mr. Wigg) will be
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    aware that the origin of this rule, which is of very old standing, was to prevent questionable words being raised and causing debate on subsequent occasions. I certainly could not allow those words to be stated.
    Mr. Sydney Silverman: Further to that point of order, Sir William. Perhaps I may, very respectfully, draw your attention to the fact that, as your yourself have stated, the words were spoken in the full hearing of the Committee. No one who heard them took the slightest exception to them—no doubt because they admitted them to be true.
    The Chairman: I think that that disposes of the matter.
    Several Hon. Members rose—
    The Chairman: Mr. Warbey.
    Mr. William Warbey: Mine is a new point of order, Sir William, but I am quite willing to give way to the hon. Member for The Wrekin (Mr. W. Yates) if he wishes to continue the point of order he raised.
    Mr. W. Yates: I am grateful to the hon. Member. Although I do not want to pursue—
    The Chairman: Order. I understood myself to have ruled quite clearly on that point of order, and I cannot entertain it any more. If the hon. Member for The Wrekin (Mr. W. Yates) has a different point, of course, I will hear it.
    Mr. Yates: I wish your guidance, Sir William, about putting down a Motion of censure on an hon. Member in Committee, and on the Chair—
    The Chairman: Order. Again, the hon. Member asks me to do more than I am empowered to do. Such a Motion would be a matter for Mr. Speaker, and not for myself. Mr. Warbey.
    Mr. Wigg: Further to that point of order, Sir William. It is not only a matter of the political lifetime of my hon. Friend the Member for Nelson and Colne (Mr. S. Silverman), but of my own lifetime and that of my hon. Friends. Those words are true.
    Mr. Warbey: On a point of order, Sir William. I desire to move that further consideration of the Bill be adjourned

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    until such a time as hon. Members have in their possession a verbatim report of yesterday's proceedings of the Committee. If I have your permission to move—
    The Chairman: Order. That I am paying attention to the hon. Member is not to assume that I am accepting his Motion to report Progress. Perhaps, at this stage, I should say that, as far as I have heard it, I do not think that I could entertain the hon. Gentleman's Motion. I heard, as did the full House, the question asked by him of Mr. Speaker, and heard Mr. Speaker dispose of it. The Committee is well aware of what is possible for HANSARD and what is not possible, and we ourselves must presume that the hon. Member was in his place throughout the debate and knows what happened.
    Mr. Warbey: Further to that point of order, Sir William. You were kind enough to indicate that you would be willing to hear me, at least while I was claiming to move this Motion. May I, first, say—
    The Chairman: Order. I thought that I had heard enough.
    Several Hon. Members rose—
    The Chairman: Order. Is the hon. Member for Ashfield (Mr. Warbey) anxious to add a word?
    Mr. Warbey: I am much obliged, Sir. William. I should like to say that I did not claim to move that the Committee should report Progress, but that the Committee should adjourn its proceedings for such time—
    The Chairman: Order. There is no such Motion. It may save the time of the Committee if I tell the hon. Gentleman that I am sure that I cannot help him upon the point he is raising. I should like to deal with other points of order.
    Several Hon. Members rose—
    The Chairman: Order. If the hon. Member for Ashfield is convinced that there is weight in what he says, I shall hear him.
    Mr. Warbey: I only desire to move a Motion under the Standing Order
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    which provides for dilatory Motions. One of the dilatory Motions provided for under the Standing Order is a Motion for the Adjournment of the discussion in Committee of the whole House, and that is what I am seeking to do.
    The Chairman: The proper Motion would be that I do report Progress and ask leave to sit again. I am not going to entertain that Motion and I cannot help the hon. Member further.
    Mr. Raymond Gower: You ruled, Sir William, and, of course, we all accept your Ruling, that you cannot entertain a point of order on remarks made at an earlier stage, but after that matter was raised by my hon. Friend the Member for The Wrekin (Mr. Yates) my hon. Friends and I distinctly heard the hon. Member for Dudley (Mr. Wigg) assert that he repeated these words and held them to be true. I respectfully submit that this was a new assertion of these objectionable words upon which you can rule.
    Mr. Wigg: Further to that point of order—
    Hon. Members: Sit down.
    The Chairman: I heard no disorderly words. I hope that the Committee will make matters easier and not more difficult by encouraging hon. Members on either side of the Committee to say words which will create a difficulty. I should much prefer to get on with the business of the Committee.
    Mr. Wigg: I must repeat what I said. I said not only in relation to my own lifetime, but also in relation to the lifetime of my hon. Friends.
    Mr. George Brown: On a point of order. I wonder whether you would allow me to enter an appeal to the Committee? This is not our Bill, but on either side of the Committee I am sure that we are not doing the reputation of the House of Commons much good—[HON. MEMBERS: "Hear, hear."] This also applies to hon. Members opposite. May I appeal for tolerance so that we can get on and start the business?
    The Chairman: The first Amendment, which is called for decision only and

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    has previously been debated, is Amendment No. 18.
    Amendment made: In page 2, line 31, leave out "exempted goods" and insert:
    "registration, to the powers of the Restrictive Practices Court thereunder".—[Mr. John Hall.]
    The Chairman: Mr. Irvine.
    Mr. A. J. Irvine rose—
    Mr. Marcus Lipton: On a point of order. You were good enough, Sir William, to indicate, when Amendment No. 7 was before the Committee yesterday, that Amendments Nos. 14, 17 and 27 and new Clause 10 were also before the Committee. You were good enough to indicate that if it were the wish of hon. Members a Division could be taken on Amendments Nos. 14 and 17. It seems that the Committee, inadvertently perhaps, is being denied an opportunity of voting on Amendments Nos. 14 and 17—[HON. MEMBERS: "It is the wrong number."]
    Mr. W. Yates rose—
    Mr. Lipton: I have not finished my point of order. I apologise for making a mistake about the number. I should like an opportunity to be afforded to the Committee of dividing on Amendment No. 14.
    Hon. Members: No, Amendment No. 27.
    The Chairman: The Committee has already divided on Amendment No. 17 and it would be out of order to go back to Amendment No. 14.
    Mr. Lipton: In those circumstances, would you allow a Division to take place on new Clause 10, because that relates to an entirely different category of goods?
    The Chairman: That had not been selected or starred for a Division. In addition, it is a very long way off. I would much sooner get on with the next Amendment.
    4.15 p.m.
    Mr. A. J. Irvine: I beg to move, Amendment No. 19, in page 3, line 9, at beginning insert:
    "Without prejudice to the generality of the foregoing provisions of this section".
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    At this stage in its deliberations the Committee turns to Clause 2, which deals with the unlawful withholding of goods by a supplier. We feel that the Clause would be improved if this Amendment were adopted by the Committee. We think this is so for one good reason in particular. If hon. Members look at the wording of subsection (3) I think that they will agree, at first reading, anyway, that in its terms it is definitive of what shall be "withholding" under the Bill.
    When one studies the subsection, however, one finds that, on analysis, it is not intended to be definitive, but is designed to refer to some particular types of withholding of supplies which are regarded as a withholding for the purposes of the Act. There is a reference to refusal to supply
    "goods to the dealer except at prices, or on terms or condiitons as to credit, discount or other matters, which are significantly less favourable than those available to other dealers carrying on business in similar circumstances".
    The Minister will be the first to recognise that the language in subsection (3) does not comprise what, in practical terms, is likely to be the most common form of withholding of all the withholdings which will occur. In other words, the language of the subsection does not comprise what I may call a complete blanket withholding of goods without anything said or any conditions attached or any offer made. It is the type of withholding of supplies which I should have thought would be most likely in practice to occur and which the Bill is plainly designed to cover.
    The language of the subsection is definitive in character. It is only on further inquiry, and, as I think, un-necessary inquiry, that one finds that it is not, in fact, definitive of withholding and does not refer to the simple decision of a supplier to stop supplying without any conditional comment or condition, a compact on the part of the supplier which in the context of the Bill it is manifestly intended to make unlawful.
    There is a sense in which this is a drafting point, but it is an important point none the less. If our wording were adopted it would become abundantly clear that the language of subsection (3) is very illustrative of certain somewhat exceptional circumstances which, but for the

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    subsection, might be thought not to constitute withholding and that the intention of the Clause as a whole is to deal with all types of withholding as an act of cutting off supplies of goods.
    That is our objective and I ask the Minister to say that the Government will give serious consideration to it. During the course of our considerations of matters in the Committee I have had the privilege, on behalf of the Opposition, of raising from time to time one or two points of a legal, or maybe drafting, character and the Minister has dealt with them with unfailing courtesy. There is no question about that. But he has always turned them down, and I think it fair to say that he has done so mainly upon the ground that he has received advice and that he can assure hon. Members on both sides of the Committee that anxieties that we have expressed are without foundation.
    That is all very well. I have the greatest respect—no one more so—for the advice which the Minister receives. Let there be no misunderstanding about that. On the other hand, it has been a very common experience of mine, and, I have no doubt, of other hon. Members, that we have considered a point like this, we have been told that advice has been received, we have been given assurances and we have been invited, on the strength of those assurances, to let the matter drop; and then, after perhaps eighteen months or two years, the whole issue has come before the court.
    The plain truth is that although, as I say, one respects the advice given, none the less the Committee has the opportunity here of improving the language of the Bill and getting rid of what, at the worst, may be an ambiguity and, at the very best, is an obstacle to the ready and clear understanding of the purpose of the Clause.
    This time, I hope that the Minister will go rather further than he has done on other occasions. I am confident that he will be extraordinarily polite about it. Let him go just this little bit further on this occasion and either say that he will accept the Amendment on behalf of the Government, or that he will give further consideration to the merits of the argument and consider rewording to meet the point.
    The Minister of State, Board of Trade (Mr. Edward du Cann): This is the third occasion on which the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) has been of assistance to the Committee. As he quite rightly pointed out, without teasing me too hard, on each of the first two occasions I found myself unable to accept his suggestions. None the less, for all that he said at the tailpiece of his short speech I hope that he may have thought that I was suitably reassuring. It was my intention to be, and I can assure him that there is no prejudice against Amendments of this sort. Indeed, we would be ready to accept them if we thought them appropriate.
    The purpose of the Amendment under consideration is, as the hon. and learned Member said, to clarify the wording of Clause 2(3). It is intended, as he went on to point out, to make it abundantly clear that Clause 2(3), which covers cases of supply at less favourable terms, is not an exhaustive definition of withholding supplies. I say at once, in case he should think that, like a gramophone record, I shall repeat the speeches that I have made twice already, that we regard the idea of the Amendment as both desirable and wise. I confirm that it is the intention of the Clause to deal with all types of withholding. This is the point that the hon. and learned Gentleman was asking me about. I agree that there would be advantages in tightening up the wording of the subsection. Therefore, I say to him at once that the Government fully accept the principle of the Amendment.
    I should like to accept the second of the hon. and learned Gentleman's proposals, but with reservations. He suggested that perhaps we would consider this matter again. I do not wish to do that, because my mind is made up about it—
    Mr. Norman Cole: I apologise for interrupting my hon. Friend, but he referred to "tightening up" the provisions of subsection (3). Surely, that is not what is wanted. What is wanted is a comprehensive net to catch any kind of new method of avoiding the abolition of resale price maintenance which might be thought of in the future. In other words, these two examples that are given

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    in Clause 2 are surely a little exclusive. They tend to make everything else look as if it is all right. We do not want a tightening up of that subsection. We want a widening of the subsection to catch everything in its net.
    Mr. du Cann: My hon. Friend is entirely right. I apologise for my some-what loose language. In saying "tightening up" I meant "improve, clarify". That is precisely what we propose to do. "Widen" is exactly right.
    If the hon. and learned Gentleman will withdraw the Amendment we will certainly table a new Amendment which will, I hope, precisely take care of the point that he has made. I would accept this Amendment if I could. I am advised, however, that it would not precisely do the job which the hon. and learned Gentleman and the Committee, particularly in the context of what my hon. Friend has just said, seek to do. That is why I seek to replace it with other wording. I apologise if I misled the Committee with my explanation.
    Mr. Irvine: We are most grateful for that assurance. Bearing it in mind, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. A. J. Irvine: I beg to move, Amendment No. 24, in page 3, line 19, after "delivery", to insert "or terms of payment".
    At this point in the Clause we are still considering the matter of the with-holding of supplies of goods from a dealer. We are now dealing with the narrow cases which this subsection is designed to exemplify and contain. In paragraph (b) there is provision, in effect, as to what shall constitute discrimination towards a dealer. It is not left open just to the discretion of the court to determine in those circumstances what shall amount to discrimination.
    The method that is chosen to be adopted by the Bill is to refer to certain matters, namely, treatment
    "significantly less favourable than other such dealers"
    receive
    "in respect of times or methods of delivery…"
    These two matters are selected to be given specific reference in the language
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    of the paragraph. We would think it appropriate, therefore, if the Clause is to be specific to that extent, to have, also, a reference to what will presumably be, in practical terms, a very common type of discrimination—more common than discrimination in respect of times or methods of delivery—namely, discrimination of a pecuniary character affecting matters of credit or amount or time of payment. That is the object of this Amendment.
    It will be observed by anyone who studies this Clause that when dealing with the case of refusal to supply goods to a dealer
    "except at prices, or on terms or conditions as to credit, discount or other matters"
    the Clause goes in some detail into what are the relevant circumstances that will constitute discrimination under that head.
    4.30 p.m.
    When it comes to the separate case of a supplier who, although he contracts to supply goods to the dealer, treats him in a manner significantly less favourable than other dealers, there is no reference to method of payment and pecuniary conditions. I suggest that that is not a logical distinction to draw, and that if the Court is not to be given complete discretion but will have its mind directed to particular matters, then in addition to a reference to times and methods of delivery, there should be an express reference to terms of payment.
    Mr. Harold Lever: Do I understand that the purpose of the Amendment is that if a manufacturer or supplier gives credit to one firm he will automatically be obliged to give similar credit to every other firm?
    Mr. Irvine: I conceive that that would not be the consequence of the Amendment if it were carried. What it is designed to do—we are on a narrow point here—is to clarify the points which a court will have to entertain and consider in determining the question whether there is or is not discrimination against a dealer. That is all. We think it desirable that the Court's attention times and methods of delivery but to the wider topic, and, we think, in should be directed not only to the classical to terms a topic more likely to be

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    relevant—the matter of methods of payment and terms of payment.
    I hope that the object of the Amendment is clear. I think I can best assist my hon. Friend by emphasising to him that we are concerned with the narrow point of the matters to which the attention of the Court is, by the language of the Bill, to be directed.
    Sir Patrick Bishop: I am a little doubtful about the meaning of the Amendment in relation to the preceding sub-paragraph, where reference is made to refusing delivery of goods, one reason being because of unfavourable conditions as to credit. It is now proposed, in relation to sub-paragraph (b), which deals with a case where the supplier contracts to supply goods, that he should not be permitted to make less favourable terms than to others with regard to the terms of payment.
    There is an Amendment on the Notice Paper in the names of some of my hon. Friends which deals more specifically with the question of credit and whether it is right, in effect, that Parliament should take upon itself to lay down rules which would compel a supplier to give terms of credit to a dealer who he may think, for reasons quite other than those envisaged by the Bill, to be not worthy of credit.
    If my hon. Friend were to accept the Amendment to sub-paragraph (b), it would defeat the whole object of a more general discussion on the question whether a supplier could be forbidden to refuse supplies on questions relating purely to credit. For that reason, I hope that my right hon. Friend will not readily consider accepting the Amendment.
    Mr. Graham Page: On a point of order, Sir William. Would it be convenient for the Committee to discuss, at the same time, the Amendment No. 25 in my name, page 3, line 20, at end insert:
    (4) Nothing in this section shall make it unlawful for a supplier to refuse to supply goods to any dealer otherwise than on terms that cash or the equivalent of cash shall be paid with the order for the goods.
    as it seems so closely related to this one?
    Mr. du Cann: Perhaps I might assist the Committee, Sir William. I should be perfectly willing to intervene at this
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    stage if that is what hon. Gentlemen wish, because the Amendment moved by the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) covers rather a narrow point, whereas the point raised by my hon. Friend the Member for Harrow, Central (Sir P. Bishop) and the one which I think my hon. Friend the Member for Crosby (Mr. Graham Page) has in mind is very much wider and we could go on to deal with it adequately and normally in the case of the next Amendment. In any case, what I should have to say to the Committee would, I think, be satisfactory to my hon. Friends.
    Mr. R. T. Paget: I find myself in considerable sympathy with the observations of the hon. Member for Harrow, Central (Sir P. Bishop). It seems to me that the more one looks at the terms of the subsection with a view to widening it, the more unworkable the whole scheme becomes.
    After all, if one is required to give credit without having regard to the circumstances which, in the mind of the supplier, affect the credit-worthiness of the person to whom he is required to give credit, amongst the factors which affect credit-worthiness is surely trust-worthiness. If a supplier finds, whether or not the contract is enforceable or void, that a man does not behave in a trust-worthy manner with regard to the methods of dealing which have been understood between them, surely he is entitled to limit credit to a man whose conduct has proved untrustworthy in his eyes. Surely the man who gives credit is the man who must judge the trust-worthiness of the person to whom he gives it.
    Again, people may legitimately fear that traders who go in for cutting prices may land themselves with an insufficient margin to carry on their business and may involve themselves in wars which they are likely to lose, and that they are likely in consequence to go bankrupt and become uncreditworthy. To say that one is compelled to give credit to a man of whose method of business one disapproves, and whose method of business, one feels, will get him into trouble, seems to be not only absurd but impossible in practice. This goes for the whole conception of the proposal.

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    Perhaps it would be more appropriate to deal with this on the Question, That the Clause stand part of the Bill, but I do not think that in the process of dealing with the Clause, against which I shall certainly vote, one ought to remain silent when Amendments are considered which seek to make it more and more absurd.
    Mr. R. J. Maxwell-Hyslop: I am very worried about the Clause and the necessity for these Amendments on a somewhat different ground. Although, at the beginning of the Clause, the words used are "for resale in the United Kingdom" I presume that it is resale in the United Kingdom if, as in so many export orders, the contract of sale is signed in the United Kingdom. This is often done specifically so that if the terms of the contract are in dispute they can be tested and adjudicated in a British court rather than, for instance, in a Venezuelan court or whatever the country might be.
    We might, therefore, bear in mind that we are not just concerned with goods changing hands in the United Kingdom, but that, potentially, there is a very wide range of export contracts which are not excluded by the phrase "resale in the United Kingdom". In the export sales of expensive capital equipment the actual terms of sale vary widely from country to country. There are such questions as whether the Export Credits Guarantee Department will or will not give cover and, if it will, on what terms and whether it is or it is not advisable to secure a contract by confirmed and reputable letters of credit if such are forthcoming.
    Every case is different and yet all of them can fall within the term of "resale in the United Kingdom". This is a point of significant substance which may well be overlooked when the words "resale in the United Kingdom" suggest that they exclude export orders. We must also remember that in many export orders there is a favoured nation clause.
    The Chairman: Perhaps the hon. Member could help me to relate his remarks to the one Amendment which we are considering, which is in page 3, line 19, after "delivery", to insert "or terms of payment".
    Mr. Maxwell-Hyslop: Yes, Sir William, I would indeed, because the
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    terms of payment may or may not include underwriting by the Export Credits Guarantee Department or may require letters of credit or insurance in the currency specified. There are a very large number of matters which may or may not have to be covered in the term "resale".
    The Amendment applies to the subsection where the major Clause refers to
    "…any goods from a dealer seeking to obtain them for resale in the United Kingdom…"
    The aircraft manufacturer, for instance, is presumably a retailer for this purpose of all the components embodied in an aeroplane such as the radar in the nose, the engines in the wings and everything of that kind.
    He is presumably, for the purposes of the Amendment, the subsection and the Clause, a dealer and, therefore, we have to be careful that the commitments which the supplier, that is, the manufacturer, may have entered into are not invalidated by the actions of a dealer who might not necessarily occur to the Committee as being a dealer in the phraseology of the Clause. In other words, this whole matter is much more complicated than the initial grounds in the Clause suggest.
    I repeat that if we merely debate the merits of Amendment No. 24 in terms of payments, with minds focused on the sale of electric bulbs in the home market we shall exclude very important considerations which we may bitterly regret afterwards
    Mr. H. Lever: I am reluctant to attack vigorously the wording of the Bill, it being conventional not to speak ill of the dead or about the dying. I do not want to point unnecessarily the comments made about the ill-conceived character of the drafting which is not related from general electioneering intentions or even commercial intentions to the true experience of commerce as illustrated by the hon. Member for Tiverton (Mr. Maxwell-Hyslop).
    It is true that the Clause could interfere with entrepôt trade. Although the Chair is human, as we have now had it authoritatively stated, we do not propose to stray beyond the Amendment to the Motion that the Clause stand part of the Bill. Although my hon. and

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    learned Friend the Member for Northampton (Mr. Paget) made remarks with which I am in profound agreement, I think that we shall have the proper opportunity of expressing them on the Question, That the Clause stand part of the Bill. My hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine) is the apotheosis of courtesy and clarity, but I cannot understand what his Amendment means if it does not mean opening the doors to some of the dangers about which some hon. Members are concerned.
    4.45 p.m.
    The subsection makes clear that it is an unlawful withholding if the supplier, although he contracts to supply goods to him, treats the dealer in a manner significantly less favourable than any other dealer in respect of times and methods of delivery or other matters arising in the execution of the contract. I would have thought that that covered sufficient already to arouse the hackles of hon. Members and to include things like terms of payment, but if we insert the words "terms of payment" we shall be forbidding the supplier to make any distinction between one customer and another as to terms of payment. If I am wrong I should be glad if my hon. and learned Friend will correct me.
    Mr. A. J. Irvine: I venture to put the matter to my hon. Friend in this way. I quite agree that the expression "other matters" probably covers terms of payment. All we seek to do by the Amendment is to draw out from "other matters" the point of "terms of payment", because we attach particular importance to that. That is all.
    Mr. Lever: I am sorry if I expressed myself in a rather muddled way. May I put the point more clearly? I understand that the effect of my hon. and learned Friend's Amendment is to say that a supplier will be unlawfully with-holding supplies if he treats a dealer, one of his customers, significantly differently as to terms of payment from any other person who he supplies.
    Mr. Graham Page: I do not think that the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) meant that, but the Clause refers only
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    to "withholding" and not to "unlawfully withholding". To be unlawful reference must be made to Clause 1.
    Mr. Lever: To build up a case of unlawful withholding one must first have a withholding, and it is a sufficient with-holding under the Clause if apparently a person refuses to give to any of his customers financial terms as favourable as to his most favoured customer. In other words, the question whether or not one is unlawfully withholding may depend on whether one is withholding, and the question whether one is withholding itself depends on an allegation that a person is not treating a customer who has complained as favourably as another customer in the matter of terms of payment.
    If the Amendment is accepted it might in certain cases—and we can work out the hypothesis—quite easily happen that a man, as part of the case of unlawfully withholding, will be found to be guilty—and I do not mean that in a criminal sense—because he has withheld goods only in the sense that he was ready to supply them but was not ready to give customer A the same terms of payment as customer B.
    In other words, the Amendment might enforce terms on a customer which otherwise would not be available to him on his credit standing. Perhaps my hon. and learned Friend the Member for Edge Hill can clear my mind on this point. I find it impossible to believe that I could fail to support him, but I could not conceivably support an Amendment which underlines still further an obnoxious matter in the Clause, namely, the intention to enforce against a firm the obligation to give the same financial arrangement to the honest and the dishonest, the solvent and the insolvent, the punctilious in payment and the dilatory in payment.
    Perhaps I have misunderstood the impact of subsection (3) and of the arguments which have been addressed. I hope that somebody will clear my mind on the point, because as the Amendment stands there are cases in which it would have the effect of compelling a supplier to give the same favourable terms to a dud customer as he gave to his best customer, and I could not support that.
    Mr. Anthony Fell: I, too, should like to clarify my mind on

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    the Amendment which was so courteously presented by the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine). Possibly I am looking at this much too simply, but surely subsection (3,a) deals with the making of the arrangements and the contract and subsection (3,b) deals with the execution of the contract. If that is true, does it not make the Amendment irrelevant?
    Mr. Michael Foot: I hasten to say that I am not rising to attempt the herculean task of clarifying the mind of my hon. Friend the Member for Manchester, Cheetham (Mr. H. Lever). Most of the previous debates have been conducted by lawyers, although my hon. Friend is not a lawyer. I am reminded of the statement of the most famous journalist who ever sat in the Press Gallery of the House of Commons, William Hazlitt, who said that the only thing that gave him any respect for the House was the contempt which he had for lawyers in the House. Since have some sympathy with this point of view, I hesitate to participate in this discussion.
    I have approached the Bill in a spirit which may be rare, if not unique, in the House of Commons. I am approaching every Amendment with a completely open mind, and I like to have the matter fully clarified before I decide which way I shall vote at the end. Since I wish to be equally clear on this Amendment as on others, I wondered whether I should reserve my own participation in the debate until I had heard the Minister. I was not sure whether that would assist the clarification or whether I should run the risk of allowing him first to enlighten the Committee.
    Although, in my approach to the Bill, I have a great deal of sympathy with my hon. and learned Friend the Member for Northampton (Mr. Paget) and my hon. Friend the Member for Cheetham, and on other Clauses, after listening to their arguments, I am inclined to come down on their side of the fence, in this case I think that they happen to be wrong. I understood that, throughout, my hon. Friends and many others who have been critical of the Government's Bill have been critical to a large extent because they wish to protect the interests of small shopkeepers. But it seems to
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    me that by their intervention on this Clause my hon. Friends are protecting the interests of the manufacturers.
    This Amendment is a protection for the retailer, because it prevents the manufacturer from discriminating between retailers and adds a further underlining of the way in which the manufacturer will be prevented from discriminating between retailers.
    Mr. Paget: It stops only discrimination between retailers which somebody can prove is based upon the fact that the retailer is cutting, or might cut, his prices.
    Mr. Foot: I understand that, but my hon. and learned Friend had the candour to say at one point that perhaps his speech might be better delivered on the Question, That the Clause stand part of the Bill. I thought that that was the most telling part of his intervention.
    If he were arguing against the whole Clause I could see some merit in his argument. This is the reason why I began with the claim, not received with overwhelming approval, that I approach all these miners with an open mind. I therefore apply myself to the Amendment before the Committee, and if it is agreed by the Committee that, in general, we wish to abolish resale price maintenance, when we look at how this Clause will operate there is an obligation on hon. Members to ensure that we shall treat retailers as fairly as possible.
    In the Clause, therefore, the conditions are laid down on which the manufacturers will be prevented from discriminating between retailers because a retailer has cut his prices. We should make it as fair as possible. If the law lays down that there shall be no resale price maintenance, which is what the Bill will achieve if it is carried, then we must try to ensure that the Bill does not subsequently discriminate unfairly against particular retailers. I would rather that the House of Commons decided the matter than leave it to individual manufacturers, which is what my hon. Friends would do.
    I cannot attempt to emulate the legal language which has come from different quarters, but as far as I can see at the moment—and I see it fairly clearly—all those who are supporting the interests of the small shopkeepers should support

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    my hon. and learned Friend's Amendment. I have the matter very clear in my mind at the moment, but I am not sure whether that will survive the intervention of the Government Front Bench.
    Mr. Gower: I hesitate to quarrel with a member of the senior branch of the profession, but my main objection to the Amendment is that it is a form of circumlocution. I cannot see how it will have any of the effects which are being suggested because on the face of it the Clause specifies the kind of methods of delivery and is followed by the all-embracing expression
    "other matters arising in the execution of the contract".
    As the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) has admitted, that certainly includes the expression incorporated in the Amendment. How the Amendment can have the slightest effect one way or another is beyond me. It is a form of circumlocution which is not necessary in the Bill.
    5.0 p.m.
    Mr. Herbert Butler: I am concerned with the smaller retailer and anxious to see that we give a measure of protection to those who are the distribution point of the manufacturers. I want to know what "terms of payment" mean. Is it a question of credit? Is it that the small retailer has to pay on delivery? Is it a question of extended terms? The Clause is designed to protect the small retailer, and to enable him to get terms as good as the large retailer would get. I should like an exact definition of what my hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine) means by "terms of payment".
    Mr. A. J. Irvine: I will deal, first, with the point raised by my hon. Friend the Member for Hackney, Central (Mr. H. Butler). It seems to me that the matters enumerated by him would all come within the expression "terms of payment".
    I am particularly glad to have the support in this matter of my hon. Friend the Member for Ebbw Vale (Mr. M. Foot). One of the things which makes life tolerable for me is the knowledge
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    that his dislike of lawyers is not universal. My hon. Friend had seized the point. I am very glad to have his support.
    I cannot do more in reply to my hon. Friends, who have insisted upon an explanation of the Amendment, than repeat what I said earlier. I remind my hon. Friends that we are dealing here with what is to be the relevant evidence of whether there has been a withholding of supplies. This is a very limited point indeed. It is this with which we are concerned. I agree with the Minister, who pointed out precisely that in an intervention. We are dealing with the narrow question of what is to be the evidence entertained by the Court in determining whether there has been a withholding of supplies.
    Mr. Angus Maude: I must confess that, after listening to the speech of the hon. and learned Gentleman and of other hon. Gentlemen, I am by no means clear. Would the hon. and learned Gentleman deal with the point raised by my hon. Friend the Member for Yarmouth (Mr. Fell)? It seems to me that subsection (3,a) deals with terms of a contract made and entered into before delivery arises. Subsection (3,b), deals with the manner in which, after a contract has been signed, notwithstanding that he has contracted a supplier tries to fiddle the retailer in the manner in which he carries the contract out.
    I am still waiting for the hon. and learned Gentleman to give me an example of a way in which a supplier could do this in respect of terms of payment without breaking his contract. Surely all the terms of payment—conditions as to credit and time of payment—must have been settled in the original contract. I cannot understand how, at the stage of delivery and execution, a supplier could get round them.
    Mr. A. J. Irvine: I am much obliged to the hon. Member for Stratford-on-Avon (Mr. Maude) for raising this point. I agree with his account of the provisions in the paragraphs. I would point out to him, in passing, that paragraph (b) is alternative to paragraph (a). I entirely agree that paragraph (b) deals with the case where there has been a contract. It assumes, and I should have thought reasonably assumes, that, even

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    where there has been a contract, there may still be a withholding of goods. That is the situation with which the paragraph is designed to deal.
    It is a matter for the Committee, but I should have thought that it would be quite possible for there to be some conduct by the supplier relative to terms of payment after a contract had been completed by which the supplier could discriminate in respect of that dealer as distinct from others.
    Mr. Maude: How?
    Mr. Irvine: The hon. Gentleman, perfectly fairly, asks, "How?" The supplier might write to the dealer telling him that, in view of his conduct, or in view of circumstances which had arisen, he proposed to require payment for the goods to be made in a particular fashion, perhaps at a date earlier than had previously been contemplated by the parties. This might well not be spelled out in the contract. There might well be an enforceable contract between the supplier and the dealer which none the less left open some room for manœuvre on the matter of payment and time of payment.
    The Committee will appreciate that this could easily occur. There might well be an enforceable contract between the supplier and the dealer, and yet, within the context of that contract, there might be some room for manœuvre under which the supplier could discriminate, and that room for manœuvre might well affect terms of payment. This is the point. I cannot put it more clearly. It is for the Committee to consider the merits.
    I fully acknowledge that most of the criticisms of the whole proposal in the Clause made by my hon. and learned Friend the Member for Northampton (Mr. Paget) and by my hon. Friend the Member for Manchester, Cheetham (Mr. H. Lever) are valid. What we are trying to do is to improve a Bill. It is sometimes desirable to improve a Bill, even if it is a bad Bill. That is what we are trying to do here. To them, I cannot say more than that in the Amendment what we are trying to do is to make clear what are the factors that the Court should be invited to have regard to in determining whether there has been a withholding of goods.
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    Let us leave aside for a moment the whole question whether a withholding of supplies is lawful. That is a different point. At some stage in any proceedings there must be a decision upon the question of fact: has there been a with-holding of supplies? In determining that issue of fact, we think that it would be wholly appropriate that the Court should have regard to any discrimination with respect to terms of payment or methods of payment. That is what we are after. We are not to be taken for one moment as approving the general process here—indeed not. Our effort here is designed to improve the Bill.
    As it has been thought appropriate to call attention in the Bill to particular factors, such as terms and methods of delivery, we, rightly or wrongly, take the view that these should not be brought out in this fashion as of special importance when discrimination affecting method of payment may be just as significant.
    Mr. H. Lever: I am sorry to take up more time on this, but it is quite an important point, although I agree with the hon. Member for Barry (Mr. Gower) that the words are tautologous and not necessary, because the mischief I am criticising would exist as the Clause is drafted. As my hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine) has had an Amendment called which underlines the evil character of the subsection, and since that is what we are discussing, it is not improper or unreasonable or illogical to focus attention upon it. We can reserve more general criticism for the debate on the Question, That the Clause stand part of the Bill.
    In spite of the objection of some hon. Members, this is law which we are making, if we pass the Clause. It is a most unhappy thing for people who are not lawyers to find that lawyers are apt to interpret law rather better than non-lawyers. It is all very well for my hon. Friend the Member for Ebbw Vale (Mr. M. Foot) to express a general antipathy to lawyers, but he will always find himself in the same anomalous position—that he is not against lawyers, but is only taking sides with one lawyer against another. I want him, with his self-proclaimed and continuous open-mindedness, to come to realise that he

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    has backed the wrong lawyer in this case and come back to our side of the matter, for this reason.
    As I understand the Clause—I hope that I shall be corrected if I am wrong; I will readily yield—its purport is that, even though a man contracts to supply goods, even though the terms of payment are exactly specified in the contract, and even though he delivers in accordance with the contract, it will still be a withholding of goods if he has treated the man supplied any less favourably as to terms of payment than somebody else—even after contract and, as far as I understand it, even after delivery.
    This abominable piece of innovation is such that the more I listen and wait for an explanation—which is a long time coming—the more indignant I am apt to wax at the meaning of the Clause.
    Mr. A. J. Irvine: If my hon. Friend's ingenious and attractive criticism is valid, will he agree that it is a criticism of the Bill rather than of the Amendment?
    Mr. Lever: I am not criticising my hon. and learned Friend, who is trying to assist the Committee in qualifying the meaning of the Clause, even though he thinks that he may be improving it. If it is a mischievous Clause one must qualify it and seek the mischief, and I am merely speaking on this point.
    Mr. Paget: What is being said by my hon. Friend is surely that suggestions for improving the efficiency of the rack are not inconsistent with the torture.
    Mr. Lever: I am merely following the argument deployed by my hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine). I think that non-lawyers will be able to interpret what I am explaining, and if I am wrong I am sure that the Minister will correct me. As I understand the Clause, we are faced with this position. If the Amendment is carried there will be a withholding for the purpose of the provision if the supplier honours the terms of his contract with a customer who has already dishonoured the terms of his contract.
    None the less, if he supplies him with goods and gives him reasonable terms of payment or credit, that will be the case, although those terms need not be as
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    favourable as the terms given to other of the supplier's dealers. In such cases there will be a withholding for the purpose of the Bill. If I am wrong in that interpretation I am ready to yield if I am corrected.
    Mr. S. Silverman: I follow my hon. Friend's point, but what is his objection?
    Mr. Lever: My objection is really a point of view. My objection is that even if the Amendment is accepted there will be difficulties. An example may help. A man supplies goods and his customer agrees not to charge less than a certain price. That customer breaks the agreement and charges something different and has, therefore, broken his contract. The Clause is intended, as is the Bill, to see that people who break their obligations of this kind are not penalised by the people with whom they are trading.
    Let us assume that we allow people to break agreements of this kind and force suppliers to deal with people who will not be persona grata willing to take part in these practices.
    Mr. Eric Lubbock: Once the Bill is on the Statute Book such an agreement would be void under Clause 1.
    Mr. Paget: Exactly, just like a bet.
    Several Hon. Members rose—
    Mr. Lever: If Clause 2 is designed to deal with the unlawful withholding of supplies on the ground that someone has sold the goods at a price below the resale price provided by the supplier—
    Mr. Lubbock: The hon. Member has been postulating that there was something in the terms of the contract—
    Mr. Lever: What I have been saying—
    Several Hon. Members rose—
    The Temporary Chairman (Dr. Horace King): Order. It will help the Committee and the Official Reporters if hon. Members address the Chair. It is becoming extremely difficult to hear.
    Mr. Lubbock: The hon. Member for Manchester, Cheetham (Mr. H. Lever) was postulating that there was something in the contract between a supplier

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    and a dealer which stated that the latter had to resell at a certain fixed price. I am pointing out that we have agreed in Clause 1, which now stands part of the Bill, that no such terms under such a contract would be valid. Such a contract would be void under the Bill.
    5.15 p.m.
    Mr. Lever: That is exactly my point. I do not know why the hon. Gentleman intervened, for he is only proving what I am saying. If the Bill is passed such agreements will indeed be void and, therefore, the supplier will be forced to deal with a man whether or not he likes to do so.
    Mr. S. Silverman: I intervene in the hope of shortening this discussion. What my hon. Friend is saying, as I understand it, is that it would be wrong to include in the Clause the words proposed by my hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine) because this would prevent a supplier from imposing a more onerous condition in the circumstances contemplated by the Clause than he imposes on others. What my hon. Friend is saying is, "Why should he not be allowed to impose an onerous condition because the retailer has broken a clause in his contract?" Since the Bill makes the terms in the contract, of which he is in breach, void, he is, therefore, not in breach of any terms of his contract and, thus, should not be penalised.
    Mr. Lever: Had my hon. Friend heard the whole of the debate on this subject he might be aware of my point. I am sorry to have to labour this point, but since there are so many non-lawyers present it may help if I explain the matter in a more simple way. The purport of the Clause is to force a supplier to supply a dealer with goods even though he does not want to do so. Such a supplier can be made to do so and he can also be made not to withhold supplies from that dealer. A part of the question of proving the unlawful withholding of supplies from a dealer must be to prove actual withholding.
    I have already said that I am willing to be corrected if I am wrong in my view that as the Clause stands it may be possible to prove the withholding of supplies from a customer if that customer is given goods on terms of credit, finance
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    or payment which are less favourable than the terms given to some others of that supplier's customers.
    The machinery of the Clause runs something like this. When one is seeking to force a man to deliver goods, one of the things one can say is that he has failed to deliver because he has contracted to supply, or he may already supplied, but that the terms of credit he is giving are significantly less favourable than some of the terms he is giving to a more lucky man with whom he is dealing. It may be asked, "What is wrong with that?", and some hon. Members may suggest, "Let us force all suppliers to treat all their customers on the same basis of credit and if they do not they should become liable to be charged with withholding supplies."
    Sir Douglas Glover: I am listening to the hon. Gentleman with interest. Would he clarify an example I have in mind? Suppose a manufacturer is supplying firm A and is allowing that firm 5 per cent. discount for payment within seven days. Would it be illegal to supply goods to firm B at 2½ per cent. based on monthly terms? Would that be discrimination or would it be allowed?
    Mr. Lever: It would depend on what had happened. I suppose that there would be nothing wrong and there would be no difficulty in having stickier terms for one customer than for another. This is normal in business, unless the customer who is being discriminated against happens to have broken whatever understanding the supplier had or whatever advice he had been given about the retail price.
    Suppose a manufacturer is supplying a trader with cornflakes and that the retail price is 1s. a packet and the terms are cash payment, but because he is not a particularly solvent trader the manufacturer says, "I will supply you but you must pay cash." That is all right and the manufacturer can insist on that—but then the retailer, instead of selling the cornflakes at 1s. a packet, sells them it 10½d.
    From then on the manufacturer will be in great difficulties because if he insists on cash payment he has broken the understanding that he had with the

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    retailer, who will say, "You are discriminating against me. You contracted to give me three months' credit and I want all of that. If you do not give it to me you will be withholding goods under the provisions of this Clause."
    Here we have a complete and unlawful withholding. The retailer will say, "This is unlawful withholding of goods because you have given me less favourable financial terms than you gave to so-and-so, and my position is a lawful one because I am in the happy position to be able to say that I broke my retail price contract before." To qualify for the full benefit of this Clause, one has to break the resale price in order to enforce more advantageous terms with the manufacturer.
    Mr. Lubbock: Let me put two points to the hon. Gentleman. First, he talks about the terms of credit—which surely come under subsection (3,a) rather than (3,b)—and, secondly, does he not think that the phrase in "similar circumstances" in (3,a) might apply to the credit service of the two dealers he has described?
    Mr. Lever: It is no good saying that subsection (3,a) covers (3,b), because it does not. I am talking about (3,b)—terms of payment and terms of credit. I am sorry if that was not obvious. Terms of payment and terms of credit are the same thing.
    I am dealing with the Amendment, and I am sure that the Chair would have called me to order if I were dealing with terms of credit under subsection (3,a), I am dealing with what happens after the manufacturer, however unwillingly, has agreed to supply the goods. He may have agreed the terms of payment, but this is the interesting point; according to the Clause—the Minister can challenge me if I am wrong—a manufacturer or supplier is guilty of withholding supplies of goods even if he contracts to supply goods to a dealer whom he dislikes and even if he agrees reasonable credit terms with him.
    Sir D. Glover: What is the point?
    Mr. Lever: I am trying to show hon. Members who are not lawyers that where an Act of Parliament says that someone is witholding goods, there is still a
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    withholding of the goods if one contracts to supply the goods and even if one delivers the goods, even after the man has received the goods and resold them at any price he likes. He can claim that there has been an illegal withholding of goods because he has not been given so much credit as has been given to some other trader.
    Mr. Gower: Would the hon. Gentleman agree that it would be a complete answer for the supplier if he could demonstrate that his action was not due to an infringement of resale price maintenance by the retailer, but because that retailer had not been in the past satisfactory in his dealings?
    Mr. Lever: A complete answer to the lawfulness of it if it could be proved. Why should he have to prove it? Why should one say that a supplier is withholding goods when he is not withholding goods? I understand that it did not commend itself to the Committee to say in the Bill that a man was deemed to have eaten a fillet steak when he had eaten a cough lozenge. How much more so should it not be attractive to the Committee to say that a supplier is guilty of withholding goods if he is not witholding them. I strongly object to a Clause which deems a man to be withholding goods when he is not, and when all that he is doing is making discrimination in terms of credit or payment, which is a reasonable and commercial thing to do.
    There is a second point that I should like to make. Some hon. Members say that discrimination as to terms of payment is one of the things that the Court should be able to look at in deciding whether there has been a withholding of goods. With great respect, if my hon. and learned Friend's Amendment is carried that is not what would happen. I would not mind, assuming that I accepted the general purpose of the Clause, if the Court could be instructed in deciding whether there had been unlawful withholding to take into account all such matters as to whether the terms of credit had been discriminatory, and so on. But, that is not what my hon. and learned Friend says or what the Clause says. It says that once it has occurred the suppliers shall be deemed to have withheld the goods.

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    That is a different matter. I agree that the Court should be entitled to take this matter into account in deciding whether there has been a withholding of goods. What I object to is that where a man in supplying a customer holds up the goods on terms of payment, it is mandatory on the Court to say that there has been a withholding of goods. I do not want to go beyond that at this point, because I hope to return to it at greater length and give more thoughtful consideration to it on the Question, That the Clause stand part of the Bill.
    We are entitled to some information. It is not necessarily reactionary in dealing with small shopkeepers to say that as between one customer and another the supplier is entitled to have regard to credit-worthiness. It is not a reactionary attitude to grant this normal commercial right to a trader, and I am surprised that the hon. Member who has to supply traders and has to have regard to the credit-worthiness of the people with whom he deals in his capacity as a publisher should think that it is not an un-reasonable thing to ask that manufacturers and suppliers should have this power.
    5.30 p.m.
    Mr. du Cann: I had a certain twinge of regret that we had passed the last two Amendments without any discussion, but we have now had 14 hon. Members intervening in this matter, which is really rather a narrow Amendment. Indeed, I have enjoyed all their speeches. The difficulty has been that I am not sure that I have understood them all. I acknowledge that that, no doubt, is entirely my own fault, but if I may endeavour to cap something said by the hon. Member for Ebbw Vale (Mr. M. Foot) a little while ago, I feel that I ought to withhold the supply of explanation not on the grounds of price cutting but of inadequacy.
    I will endeavour to deal with the Amendment, and there is one very general remark I wish to make which I hope will be of assistance to the Committee. To begin with, subsection (3), which we are discussing, provides that two forms of discrimination are to be treated as if they amounted to a withholding of supplies. The hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) went through
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    them with some care, and I will not repeat them. To come specifically to the Amendment, the hon. and learned Gentleman stated that a court should have regard to the terms of payment. That must certainly be true, and that is one of the important matters to be considered.
    The Amendment would add the words "or terms of payment" after the word "delivery" in paragraph (b). We take the view that it is not necessary to add these words because the terms of payment are not matters which can arise in the execution of a contract. As my hon. Friend the Member for Yarmouth (Mr. Fell) pointed out, and as my hon. Friend the Member for Stratford-on-Avon (Mr. Maude) pointed out, terms of payment would have to be agreed at the time of the contract, even if spread over a period of time. So, if the supplier offers to the dealer significantly less favourable terms of payment than to other dealers, then the case is covered by paragraph (a) which refers to terms or conditions which would include terms of payment. Therefore, I agree with the hon. Gentleman that this is a point which calls for consideration as a matter of some substance. None the less, it is already covered, in our view, and I hope that the Committee will feel reassured by what I have said in that regard.
    Mr. John Hynd: If it were the practice of the supplier to provide in the contract for payment within a certain period of time but it was his practice, none the less, to give a reasonable extension of the time and in one case he refused to give such a concession, would that not be discrimination that occurs afterwards?
    Mr. du Cann: Yes, it would be part of the contract and could be considered as such, and, indeed, is covered by the Clause as drafted. If the Committee wishes, and if there is any doubt about the matter. I will certainly undertake to look at it again in the light of this discussion.
    Mr. J. Hynd: It may be part of the contract that payment should be made within a specified period, but it may be the long-established practice of the supplier to give to reliable customers an extension, by a gentleman's agreement or a general concession, in a particular case.
    Mr. du Cann: My impression is that the matter is covered, but I am perfectly willing to look at it again. If it is not covered, then we will propose an Amendment to deal with the subject. However, I feel quite clearly, although I may be wrong, that it is covered.
    Mr. H. Butler: All of this case seems to be concentrated on a manufacturer entering into a contract with a retailer. In fact, that is not so. It may be so in the minds of lawyers. The manufacturer may show a small retailer a suite of furniture which he proposes to buy. He may be selling him other goods as well, and the retailer gives the order to the agent who at some time delivers the suite. As far as he knows, he is going to get the normal terms of credit, but, in contradistinction to the credit allowed to a large retailer, the manufacturer says, "You have to pay pro forma". No formal contract is entered into. I appreciate that the Minister says he will give consideration to the matter, but I want to disabuse the minds of hon. Members who believe that the small retailer enters into a fixed contract and terms of payment. Day after day representatives call on small retailers and there is discrimination in these matters which creates the difficulties outlined.
    Mr. du Cann: I think I understand what the hon. Member for Hackney, Central (Mr. H. Butler) is saying, but, of course, contracts do not necessarily have to be written. They can be verbal and their terms need not be necessarily expressed. They can be implied. Therefore, I think that the circumstances which he has in mind are covered by the Clause. At any rate, I have given a general assurance on the matter.
    The other general point I want to make—we shall be discussing this, but I think it relevant to make it now—is that under the Clause as drafted a supplier is perfectly entitled to impose whatever terms he wishes when he supplies the goods so long as he does not offer significantly less favourable terms to a dealer because he is cutting prices or is likely to do so.
    Having given the Committee that explanation in regard to the Amendment itself, I hope that the hon. and learned Member for Edge Hill may not wish to press it at the moment. Indeed, should it be necessary, we can discuss it further at another stage.
    Mr. H. Lever: Am I wrong in supposing that the subsection as it stands will treat the manufacturer as I have alleged, as withholding supplies for the purpose of the Clause, if he delivers the goods in accordance with his contract but thereafter it is discovered that his terms of payment were significantly less favourable than those offered to other customers? Am I right or wrong in alleging that?
    Mr. du Cann: It would take me a minute or two to reply to the hon. Gentleman. I think that it would be going very far beyond the Amendment, and I would not wish to trepass on your patience, Dr. King, by going outside the rules of order. I will, if I may, give the hon. Gentleman a full answer in the debate on the Question "That the Clause stand part of the Bill."
    Mr. Niall MacDermot: May I seek to join in the Herculean task of clearing the minds of hon. Gentlemen on this Amendment? I suppose that, being a lawyer, all I shall succeed in doing is to increase the fog.
    Listening to the Minister's reply, I am led to wonder whether he really has himself appreciated the point, as I understand it, of my hon. and learned Friend's Amendment. As has been pointed out by a number of hon. Members, paragraph (a) of the subsection dealing with the making of the contract. Paragraph (b) deals with the performance of the contract. Surely, the point here is that we get the case where a supplier enters into identically the same contract with several different dealers—that he enters into a contract with dealers A, B, C and D—and that these contracts are all in identical terms, but that he discriminates between them in the way in which he enforces the contract.
    As I understand my hon. and learned Friend's Amendment, it is directed to the case where the discrimination between dealers does not lie in discrimination as to the terms of the contract but to discrimination in the enforcement of those terms and, in particular, in the terms as to payment. The common terms of all the contracts may be for payment on delivery, but the way in which the supplier who is trying to enforce resale price maintenance can try to get round it is by saying to the offending dealer, as he considers him, "I am going to hold you

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    directly to the terms of the contract, but, of course, if you adhere to resale price maintenance then I will extend to you the same facility which I am granting to other customers, not as a term of the contract"—ex gratia as lawyers call it—"the facility of extended credit."
    It is that situation which at the moment is not covered by the Bill at all. Whether, in fact, it is practicable to try to render unlawful practices of that kind is a more general question which I think we should discuss on the Question, "That the Clause stand part of the Bill". But, as I understand it, that is the point to which the Amendment is directed. Judging by the Minister's answer, I do not think that he appreciates that this door is still left open in the Clause as at present drafted.
    Mr. du Cann: I am very grateful to the hon. and learned Member for Derby, North (Mr. MacDermot) for his typically clear explanation, but, whatever impression I may have created in his mind, I am satisfied in my own that I have understood the matter. I certainly understood his extremely clear speech. I am satisfied also that the matter is covered. Nevertheless, I have undertaken to study what has been said in the debate.
    Mr. A. J. Irvine: If the expression "terms of payment" in the Amendment related to terms contained in the contract, it would, of course, be an illogical Amendment. As I understood it, that was the point taken by the hon. Member for Stratford-on-Avon (Mr. Maude), and I agree with him about that. However, my hon. and learned Friend the Member for Derby, North (Mr. MacDermot) has expressed the matter absolutely correctly. We are concerned to deal with the possibility of discrimination in the enforcement of contracts or the methods of payment pursuant to contracts after the contracts have been concluded.
    The Minister has been good enough to give us certain assurances. I am obliged to him for them, because I think that they go fairly far. He will look into the matter and consider it further. I hope that, in his consideration of the points we have raised, he will have particular regard to the question directed to him by my hon. Friend
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    the Member for Sheffield, Attercliffe (Mr. J. Hynd), which, in a very few words, put precisely the question which we wish to have considered further.
    I hope that the Committee will think that this has been a useful discussion. In view of the assurances which we have received, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. Graham Page: I beg to move Amendment No. 25, in page 3, line 20, at the end to insert:
    (4) Nothing in this section shall make it unlawful for a supplier to refuse to supply goods to any dealer otherwise than on terms that cash or the equivalent of cash shall be paid with the order for the goods.
    This new subsection is intended to ensure that refusal to supply goods on credit or refusal to supply because of a dealer's lack of financial substance shall not be prejudiced by the Bill. I hope that, in putting the Amendment to the Committee, I shall not be guilty of tedious repetition. What I say is bound to cover some of the points raised on the previous Amendment.
    Under subsection (1) of the Clause as it stands, it is unlawful to withhold supplies of goods on the grounds there set out, that is, that the dealer has sold at a price below the recommended resale price or is likely so to do. This is said to be an unlawful withholding.
    One turns then to subsection (3) to see what is or what can be a withholding of goods. A supplier shall be treated as withholding supplies of goods if the conditions in paragraphs (a) or (b) exist. Under (a), he shall be treated as withholding supplies if he refuses to supply the goods on terms or conditions "significantly less favourable" and so on.
    One turns then to Clause 4(4). Supplies will be wrongfully withheld if the conditions in paragraphs (a) and (b) apply, that is, if down to the time when supplies were so withheld
    "the supplier was doing business with the dealer or was supplying goods of the same description to other dealers…"
    and he knows that the dealer has been selling goods under the recommended resale price.
    5.45 p.m.
    Let us suppose that a supplier merely refuses to supply on credit. He does

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    not think that the dealer has the substance to justify the giving of credit and he wants payment in cash. He has then contravened Clause 2(3,a). Never mind whether it is an unlawful withholding or not, at that stage he has withheld goods because he has refused to supply them unless the man pays cash. The question then is, Has he done so unlawfully under Clause 2(1) on the grounds set out in paragraphs (a) or (b) thereof.
    In order to answer that question, one turns to Clause 4(4). If he has been doing trade with that retailer or with another retailer in the same line of business, and he knows that the retailer has undercut or has threatened to undercut, he is then presumed to have withheld the goods unlawfully. The undercutting has nothing to do with the matter in his own mind, however; he has refused merely because he wanted cash for the goods.
    I shall try to illustrate the point by an example. A supplier has been supplying goods to confectioner A. Confectioner B asks for similar supplies. He says, "You have been supplying A. Please supply me with the sweets which you have been supplying to A". The supplier knows that retailer B has been selling at below the recommended resale price, so Clause 4(4) comes into operation. But he knows also that retailer B is insolvent, so he refuses to supply unless he gets cash for the goods.
    However, because he knew of the undercutting by B, he is presumed to have wrongfully refused to supply B with the goods and he can be sued under Clause 4(2). On proof of his requirement of cash for the goods, he at once is turned from a defendant in that action to a plaintiff who has to prove something. He is no longer a defendant who can call on his plaintiff to prove the case. Once the original plaintiff has proved, "You refused these goods except on cash terms", the unfortunate supplier has to say, "Yes, but I did not refuse them because you were undercutting. That was not in my mind". He is thus forced to prove a state of mind in order to justify his refusal to supply the goods except on cash terms.
    As the Bill stands, the supplier in such circumstances may well be found by the
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    court to have wrongfully withheld supplies and to be subject to a civil action for damages under Clause 4(2).
    Mr. Ronald Bell: An injunction.
    Mr. Page: For an injunction, yes. A supplier must be allowed to decide for himself whether he will require cash for goods or will grant credit. If the Bill prevents a dealer doing that by this roundabout way of trying to make him prove a state of mind or a negative state of mind, it is going much too far. I think that if we could say this definitely, as I propose in my Amendment, it would be a great relief to both suppliers and retailers and that it would make the Bill workable.
    Mr. Ronald Bell: I support the Amendment. I do not wish to repeat the arguments used by my hon. Friend the Member for Crosby (Mr. Graham Page) except to say this. If the dealer who has not hitherto been receiving supplies from the supplier goes to the supplier and says, "You have been supplying these goods to other dealers, but not to me. I want to sell them at a cut price", he can force the supplier to supply him on credit unless the supplier is willing to undertake in a civil action the burden of proving affirmatively that his reason for his insistence upon supplying for cash was not due to the fact that he had been told that the man would sell at cut prices. I hope that that is not an involved sentence; I think that the point is clear. [An HON. MEMBER: "It had no verb."] It had a main verb and I believe that it came in the right place. I was receiving so much vocal encouragement from both sides of the Committee that the syntax may have got a bit muddled.
    This is a point which, perhaps, we shall want to discuss more on Clause 4, which contains the subsection which is causing the trouble. However, my hon. Friend the Member for Crosby was quite right to raise it by proposing an Amendment to Clause 2 because the consequences of Clause 4 relate back to Clause 2 and one knows how difficult it is to bear the burden of proving affirmatively the state of one's own mind. It seems to me quite wrong that a dealer who has never had any business dealings with a certain supplier

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    should be able to go along to that supplier and say, "I want to sell your goods at a cut price. You supply me for cash or go to the Restrictive Practices Court".
    Mr. J. Hynd: I follow the hon. Member's argument and I can agree with it, but I do not see how the Amendment alters the position, because it merely says that it will not be unlawful to require payment in cash. However, if it were inserted in the Bill, it still would not affect the situation as laid down in the Bill, which is that everybody must be treated alike.
    Mr. Bell: I agree with that intervention, but its effect is to point out that the Amendment cures only part of the mischief. I think that that was the point of it. It is a valid point, and I agree that we must return to it on Clause 4 if we agree that Clause 2 should stand part of the Bill. I have grave doubts about that, and we will come to those doubts in due course. This is a useful Amendment, but the main consideration of this point will arise later.
    Mr. H. Lever: As I have said, I propose to reserve extended discussion of this matter on the Question, That the Clause stand part of the Bill. I fully support the purpose of the Amendment, and I wish merely to say this in reinforcing what has been said.
    It is surely utterly repugnant to any sense of normal commercial practice that we should embody in an Act matter which in practice would compel a man to grant credit to another whether he wished to do so or not. This is so outrageous that I trust that the Committee will reject it out of hand. The Amendment only partially cures the abomination of much of this abominable Clause. I hope that the Committee will give a warning to the Government in time. However, I do not want to play party politics, although I am not without enjoyment of them from time to time.
    I hope that the Committee will take the opportunity to force this Amendment on the Government, whether they like it or not, so that they may escape further humiliation through outraging their own supporters and many open-minded Members. I will certainly vote for the Amendment if there is a Division.
    Mr. R. Gresham Cooke: I support the Amendment, for this reason. A large number of traders are opposed to parts of the Bill because of the obscurity of the Clauses. One point which has been raised with me is whether traders can withhold supplies when a dealer becomes non-creditworthy. There has been so much opposition to the Bill for a large number of reasons that I suggest that it is right for the Government to clear up this point about whether suppliers can withhold goods if they believe that the dealer is not creditworthy, whether or not he is cut pricing them.
    Mr. S. Silverman: This Amendment, like the last one, raises general questions of principle which I think it would be better to discuss when we deal with the Question, That the Clause stand part of the Bill. I hope that all those who have expressed doubts about the principles behind the Clause and, indeed, about some of the principles behind the Amendments will take up the matter again at that stage when it can be discussed more fully so that we get a clear picture before deciding whether the Clause is a good or bad Clause. I therefore refrain from entering into detailed discussion of the Amendment. However, I should like to put one consideration to the hon. Member for Crosby (Mr. Graham Page) and to those who have supported the Amendment.
    Suppose that a supplier has reason to believe that the retailer to whom he has been in the habit of delivering supplies on certain terms is evading a condition, which is, in any case, void by the Bill, to sell them at a certain price. Suppose that he says, "I know a way to stop that. This man always trades with one month's delay in payment and on certain discount terms. I know that if I insist on cash on delivery he will not be able to pay. If he is not able to pay, and if that term is in his contract, I will have effectively stopped his source of supply. He would have effectively stopped his source of supply, but is not that exactly what the Bill sets out to prevent? If the Amendment is accepted in its present form—and I realise that it could be amended—I cannot see how it will not provide a broad highway along which one could drive a

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    very large Rolls Royce through the Bill's main provisions. There is nothing to prevent it.
    The hon. Member for Buckinghamshire, South (Mr. Ronald Bell) says, "Of course, you can go to the Restrictive Practices Court". He dealt with the difficulty of satisfying a court about what is in one's mind. All lawyers appreciate the difficulty of doing that, although they also appreciate that there is a variety of circumstances under the law in which one has to do that very thing. If it is difficult to satisfy a court about the state of one's own mind, it is infinitely more difficult to satisfy a court about the state of somebody else's mind.
    6.0 p.m.
    What the hon. Member for Crosby is seeking to do is to transfer the onus of proof if a condition of cash payment is imposed to make the retailer, or, it may be, the Registrar or somebody else, satisfy the court that it was done for the purpose of evading the Act and because the retailer had been selling at unauthorised prices. How does he prove that and why is that easier or more just to provide than to say, in the case of a retailer, "You used to supply him on credit. You supply everybody else on credit. You have suddenly stopped supplying him on credit. You have insisted upon cash knowing that he does not have cash. It is, or it may be, a fair inference from all those facts that you did it to stop his supplies"? What is wrong with that?
    Mr. H. Lever: My hon. Friend is wrong in supposing that that is the purport of the Amendment. It does not say, as my hon. Friend supposes, that it would transfer the onus of proof. The Amendment—

    ROYAL ASSENT
    Whereupon The GENTLEMAN USHER OF THE BLACK ROD being come with a Message, The CHAIRMAN left the Chair.
    Mr. SPEAKER resumed the Chair.
    Message to attend the Lords Commissioners:
    The House went:—and, having returned;
    Mr. SPEAKER reported the Royal Assent to:

    1. Consolidated Fund (No. 2) Act, 1964.

    2. Rating (Interim Relief) Act, 1964.

    3. Married Women's Property Act, 1964.

    4. Uganda Act, 1964.

    5. Television Act, 1964.

    6. British Nationality Act, 1964.

    7. Fireworks Act, 1964.

    8. Trade Union (Amalgamations, etc.) Act, 1964.

    9. War Damage Act, 1964.

    10. Licensing Act, 1964.

    11. Salmon and Freshwater Fisheries Act, 1923 (Amendment) Act, 1964.

    12. Motherwell and Wishaw Burgh Extension, &c. Order Confirmation Act, 1964.

    13. Port of London (Extension of Seaward Limit) Act, 1964.

    14. Customs Annuity and Benevolent Fund Act, 1964.

    15. City of London (Courts) Act, 1964.

    RESALE PRICES BILL
    Again considered in Committee.
    [Sir WILLIAM ANSTRUTHER-GRAY in the Chair]
    Amendment proposed: In page 3, line 20, at end insert:
    (4) Nothing in this section shall make it unlawful for a supplier to refuse to supply goods to any dealer otherwise than on terms that cash or the equivalent of cash shall be paid with the order for the goods.
    Question again proposed, That those words be there inserted.
    6.16 p.m.
    Mr. H. Lever: What I wanted to put to my hon. Friend the Member for Nelson and Colne (Mr. S. Silverman) was this, that contrary to what he has said, this Amendment is not intended to transfer the onus of proof but to restore, categorically and unconditionally, the right of any manufacturer, in any circumstances and for any reason whatsoever, not to

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    grant credit where he does not want to grant it.
    The second point I want to put is, that surely there is a difference between making retail price maintenance illegal or void and forcing one to grant credit to people in the course of that purpose.
    Mr. S. Silverman: My hon. Friend is in many ways perfectly right, but if we are to preserve freedom of contract in every respect uninfluenced and unembarrassed and uninhibited by the House of Commons we shall have to defeat the Bill or persuade the Government to withdraw it. The point that I am making is not an academic one; it is quite simple. The whole purpose of the Bill is to interfere with freedom of contract. That is what it is for. If we object to a particular provision, the way is not to undo it because it interferes with freedom of contract—
    Mr. H. Lever: There are degrees of freedom.
    Mr. Silverman: We shall come to degrees of freedom in a moment. Do not let us base ourselves on the question of freedom of contract, because the purpose of the Bill is to prevent in certain respects and for certain purposes the freedom of people to contract with one another. That is what it is for.
    The question is whether we should pass an Amendment which would restore—if it is taken away, which is not quite clear; but if it is taken away—to the supplier complete freedom to contract in one respect. It would restore him complete freedom to fix, at his own absolute discretion, on what terms, cash terms or credit terms, he will supply goods. That is what my hon. Friend says is the purpose of the Amendment. Am I right?
    Mr. Lever: Correct.
    Mr. Silverman: All I am saying is that, if we do that, then we are enabling in this respect the supplier to do in any circumstances at his own discretion what the Bill forbids him to do. In effect, by insisting on cash where he knows that cash is not available, the supplier is preventing the retailer from getting supplies.
    I shall not split hairs about the difference between preventing him from getting
    522
    supplies and withholding supplies from him. For all practical purposes they are the same thing. I agree that, if the supplier is imposing a cash condition by reason of a careful and fair assessment of the financial risk, he should not be prevented from doing so and nothing in the Bill prevents him from doing so.
    If, on the other hand, there is no unreasonable financial risk, but he is withholding credit under the guise or pretence of preserving his freedom of contract about cash or credit payments, then what he is really doing is to prevent a cut price seller from getting supplies. That achieves the very thing which is defined in the Clause as being an unlawful withholding of supplies.
    Mr. Graham Page: I am sure that the hon. Member can see where his argument is leading. The effect would be that a supplier could be forced to finance a retailer for a period by giving him credit. The alternative would be civil action for damages.
    Mr. Silverman: Only where the supplier has been in the habit of financing the retailer in question. [HON. MEMBERS: "No."] Yes.
    Mr. Page: The hon. Member should look at Clause 4(4,b).
    Mr. Silverman: All this interchange only reinforces what I said at the beginning—that the proper time to discuss all these matters is when we consider the Clause as a whole.
    Suppose there is such a design. Suppose a supplier has reason to believe that there is a cut price seller whom he has been in the habit of financing to the extent suggested by the hon. Member for Crosby (Mr. Graham Page). Suppose he is looking around for a way of doing what the Bill says that he must not do—withhold supplies. This Amendment would give him the golden opportunity to do what he will not be able to do if the Bill remains as it is.
    The Amendment goes too far for the genuine purpose behind it. It is not unreasonable for a manufacturer to choose for himself to whom he will give credit and to whom he will not. The Amendment goes too far in that it would enable him to withhold credit,

    523
    perhaps from an old customer who has always had it, for reasons that the Bill would make unlawful reasons.
    Dr. Alan Glyn: I wonder whether this Amendment achieves what we want. We want to preserve the right of any manufacturer to refuse to supply a retailer who he does not consider creditworthy. If the Amendment would achieve that, then it would go a long way towards allaying many fears among retailers who consider that they would be obliged, if the Bill went through unamended, to supply people even though those persons were not creditworthy.
    I am also not clear about the words
    "…on terms that cash or the equivalent of cash…"
    What does this mean? What is the equivalent of cash? Is it a cheque or a banker's order? The legal interpretation of these words should be made clear.
    Mr. George Darling: I hope that the Minister will accept the Amendment, although I share the doubts expressed by the hon. Member for Nelson and Colne (Mr. S. Silverman). When the hon. Member for Harrow, Central (Sir P. Bishop) anticipated this Amendment, he said that it would deal with this point. I thought that he meant that it would deal clearly with the issue. I am a layman in these matters and it took me a considerable time to understand what these words mean. Even then, only with the help of my hon. and learned Friend the Member for Walsall, North (Mr. W. Wells) did I get it right.
    Nowhere does the Amendment mention credit. Certainly, a supplier should be in a position to withhold supplies from a person to whom he does not wish to grant credit and from whom he wishes to insist on cash payments. Like my hon. Friend the Member for Ebbw Vale (Mr. M. Foot), I approach this with an open mind. My fears on this occasion are for the small shopkeeper, for the little grocer in the backstreet.
    My hon. Friend the Member for Ebbw Vale and I both represent steel constituencies. Where there are steel works there are shift workers and the little shops in the back streets of indus-
    524
    trial areas provide a great deal of service to these workers who, because of their hours of work—many of the wives are also on shift work—cannot get to the main shopping centre. Obviously, these small shops have not a great deal of financial substance behind them. They may be inefficient if one measures costs against the way they operate.
    But they provide a social service to some extent. In addition, many of them are run by injured workers who put their compensation payments into them. I am one of those who will be lining up with my hon. Friend to fight for them in our consideration of the Bill.
    Sir P. Bishop: The hon. Member perhaps does not realise that the Clause would work both ways. Supposing a supplier wanted to give extended special credit to a small shopkeeper like those he is referring to, the supplier would be debarred by the Clause from doing so unless he was prepared to give the same credit to all his customers.
    Mr. Darling: I was coming to that point. I understand that, if the Amendment were accepted, it would work as I think both the hon. Member for Harrow, Central and I want it to work. The supplier would be in a position to refuse to supply on credit terms a person he did not think credit worthy.
    Mr. H. Lever: The Amendment clearly says that he would be able to refuse to supply on credit whether the man was credit-worthy or not, withiut giving any reason.
    Mr. Darling: That is obviously true, but in reasonable practice the supplier would refuse credit to the person he thinks is not credit-worthy. It is true that the Amendment would allow him to refuse credit terms to anybody, but, in practice, he would refuse it only to persons he regarded as being not creditworthy.
    Mr. S. Silverman: It would enable him to refuse credit for reasons which the Bill makes unlawful.
    6.30 p.m.
    Mr. Darling: I want to get rid of this problem by putting a question to the Minister. I am merely leading up to it. In practice, what will happen is that the manufacturer will refuse to supply goods

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    on credit terms to a person who, he thinks, is not credit-worthy. He can refuse others if he wants. At the same time, he can also refuse to help my small shopkeepers. I do not know how we can deal with this in the Bill, but I should like to make sure that my small shopkeepers are not to be handicapped, any more than they already are in the Bill, by the inclusion of this Amendment.
    I began by saying that I was not a lawyer. I have approached this with an open mind. The arguments of the hon. Member for Crosby (Mr. Graham Page) confirmed what my hon. and learned Friend the Member for Walsall, North told me and I now know where I am. What I am asking is whether there is any way when we have accepted the Amendment of making sure that my small shopkeepers will not be harmed by the Amendment. However, I accept the general terms of the Amendment.
    Mr. Ronald Bell: I want to speak partly because of something the hon. Member for Nelson and Colne (Mr. S. Silverman) said and partly because of something which the hon. Member for Sheffield, Hillsborough (Mr. Darling) said. I start with the latter.
    Was not the hon. Gentleman overlooking that the supplier might want to refuse credit not because the dealer was not credit-worthy, but because the supplier could not afford any more credit? Might he not have been supplying a number of dealers on credit for a number of years, but then find a new demand, which might be on a large scale, which might put him in difficulty? Might he not just happen to be in difficulty? Is it not a great hardship for him to have to go before the Restrictive Practices Court and publicise his financial embarrassment before all the trade? That is the kind of position to which provisions of this sort lead.
    Mr. Paget: Is it not the more vicious as his inability to give credit might well result from the fact that his business has been disrupted by the Bill?
    Mr. Bell: I shall not rise to that particular fly, skilfully though it was cast across the Chamber. I turn to what was said by the hon. Member for Nelson and Colne, who is quite a formidable person in himself.
    526
    Was not the hon. Gentleman overlooking that giving credit is always a favour and that on the face of things one is always entitled to be paid cash? Ought we to formulise the giving of credit which may have been customary in the business? Are we to make it a statutory duty on the supplier always to give it? It seems to be very harsh if he does not want to do so. After all, the considerations which move him to give credit in other cases may be very diverse. There may be a blood relationship, or an old association, or all sorts of other things. It seems very unreasonable that he should have to trot all this out before the Court and explain his state of mind and justify his refusing to a new customer, who may never have been to him before, what after all is a credit.
    I appreciate the argument of the hon. Member for Manchester, Cheetham (Mr. H. Lever). The Amendment covers not only the new, but the old customer. Incidentally, in relation to the old customer we get back to the point I was making, which was that the supplier may have been granting him credit, but may want to stop it. I realise that that is a difficult point. However, it seems to me that the hon. Member for Nelson and Colne was overlooking the fact that, basically, one is entitled to demand cash and might grant credit for all sorts of diverse reasons which are very difficult to mention in a court of law.
    Mr. S. Silverman: I have great sympathy with what the hon. Member for Buckinghamshire, South (Mr. Ronald Bell) has been saying. Hon. Members have been talking about having open minds as though lawyers never have them. The only thing lawyers insist upon is that whereas a good judge ought to have an open mind at the beginning of an argument, it is a poor judge who has a mind still open at the end of it. One cannot have an open mind for ever. At some stage one has to give a judgment.
    What I object to in the Amendment is not any of the things in it which have been defended. I see the point of all this and I respectfully support these things; but I am saying that the Amendment goes too far for that purpose, because it would enable a supplier, without any ostensible reason, effectively to withhold supplies because he suspected that a retailer was selling cut price.

    527
    If the sponsors of the Amendment could devise some form of words to integrate this perfectly reasonable Amendment with the purpose of the Bill and not make it an offence to that purpose and in breach of the Bill, I would think that it was a good Amendment. I say that even without prejudice to my own personal view that the Clause and the Bill are both bad and that we would all be much better off if they had never been introduced.
    Sir P. Bishop: Unlike the hon. Member for Nelson and Colne (Mr. S. Silverman), I think that the Amendment does not go far enough. I apologise to the hon. Member for Sheffield, Hillsborough (Mr. Darling) if I misled him about it when we referred to this matter earlier. I was under the impression that we might be able to discuss the whole subject of credit, but it may be that we shall have to leave that until we debate the Question, That the Clause stand part of the Bill.
    But that does not alter the fact that this is a very good Amendment. It does not seem to go a step beyond what is one of the most natural and obvious rights which any trader going into business should possess—the right to say to a man who wants to do business with him and to buy his goods, "I will sell you these goods; you give me cash over the counter for them". How it could be proposed to take that right from a trader is inexplicable. I know that it is meant to take that right away only when the supplier intends to use it, or does use it, for the wrong reasons, but the effect of the Clause as it stands would be quite different and would debar the supplier from what is surely a natural right, and it would do so even when he had perfectly legitimate reasons.
    I hope to hear from my hon. Friend that the Government are prepared to consider this matter in the light of our debate on this subject of the obligation of a supplier to give credit, and that they will consider whether some Amendment is required. However, this Amendment would not affect that issue one way or the other and I support it.
    Mr. R. E. Winterbottom: I should like to get this issue of cash and credit clear in my
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    mind. Subsection (3,a) deals with conditions as to credit. At first glance, it would appear that if the Amendment were accepted it would undermine the conditions under which credit is given.
    Mr. H. Lever: There is no doubt about that.
    Mr. Winterbottom: My hon. Friend says that there is no doubt about that, but all the conditions of credit are not confined to cash or to the period in which repayment has to be made.
    From my experience of the retail and wholesale trades, I know that very often special conditions have to be laid down to meet special cases. Those special conditions may be called conditions as to credit to one special customer, and they cannot be applied in general. I should therefore like a better definition of this condition as to credit.
    It seems to me that a little practical experience would enable hon. Members to understand the relationship between a wholesaler and a retailer. My hon. Friend the Member for Sheffield, Hillsborough (Mr. Darling) referred to small shops in Sheffield. Most of those small shops exist by credit, and most of them find that their credit is cut if they do not pay within the specified time. Furthermore, most of them, in turn, exist by granting credit and there is nothing in the Bill to say that the retail shopkeeper shall have the right to get cash from his customers. Very often the relationship between a retailer and a wholesaler is controlled by the amount of cash that the wholesaler has received from the credit that he has allowed, and it appears to me that those conditions ought to be clarified in the Clause.
    From a practical point of view there is one thing that the Government could do. They could redraft the Clause, because one thing that is certain is that if it is accepted there will be more confusion in the wholesale and retail trades than there has been since this House—I think that it was in 1916—passed an Act saying that butter had to be weighed unwrapped. Unfortunately, that Act came into force on 1st July during a very hot summer, and nobody could sell butter for 16 hours until the Government issued an edict enabling retailers to

    529
    wrap the butter in paper before weighing it, provided that paper did not exceed a certain weight.
    The Deputy-Chairman (Sir Robert Grimston): Order. The hon. Gentleman is going a little wide of the Amendment.
    Mr. Winterbottom: The moral of that ancient story applies to this Clause and it is—
    The Deputy-Chairman: We are not dealing with the Clause. We are dealing with the Amendment. I think that the hon. Gentleman's remarks would be better addressed to the Question, That the Clause stand part of the Bill.
    6.45 p.m.
    Mr. Winterbottom: I have been engaged for many years in narrowing down from the bulk to the unit. It is part of the knowledge of distribution. I have, therefore, moved from the Clause to the specific Amendment before us, and to the Amendment in relation to the Clause, which I submit will cause more confusion in the distributive trades than I have known during the last 14 years.
    I suggest that the Clause, or the Amendment in relation to the Clause, should be reconsidered, and that the Government should bring in a provision which is more practical and sensible, and which can be understood both by the wholesaler and by the retailer. I think that the Clause must have been drafted by someone who did not know the difference between production and distribution and did not appreciate the difficulties which the hon. Member for Crosby (Mr. Graham Page) has appreciated.
    If the Amendment were not accepted and this Clause became part of the law of the land, wholesalers would face ruin because of the amount of credit which they have allowed their retail customers. If they have to increase that credit, they will have to borrow money outside the distributive trades, probably at extremely high rates of interest. These are practical issues, and if the Government are not prepared to consider the matter, shall give my wholehearted support to the Amendment.
    Mr. Cole: The hon. Member for Sheffield, Brightside (Mr. Winterbottom), and the hon. Member for Nelson and Colne (Mr. S. Silverman) propose to
    530
    say a few words on the Question, That the Clause stand part of the Bill, and if I catch your eye in due time I shall do so as well.
    This Amendment is one more example of hon. Members being engaged on the herculean task of trying to make the Clause of practical value. I am sure that my hon. Friend the Member for Crosby (Mr. Graham Page) would be the first to admit that in an Amendment of two and a half lines he cannot cover all the possibilities that he would like to cover. Among other things, he seems to be trying to enshrine the existing practice in a particular trade. There are many trades in which cash is the order of the day. I can think of instances in which a wholesaler will not unload goods on to a retailer's property unless he is paid his money first. I shall not weary the Committee by going into details of that situation, but I understand that that happens in some of the larger businesses.
    What the Amendment seeks to do is to say that the practice of the last 50 years shall continue, and that the man who follows it will not offend the dictat of Clause 2 and, therefore, will not offend against the purposes of he Bill. In short, this Amendment—and, indeed, some of the others to this Clause—is a clear and outstanding example of the difficulties with which we are trying to cope.
    So far as it goes—even if it goes too far for some people—I support the Amendment, but I hope my hon. Friend the Member for Crosby will not mind my saying that this is not the end of the story. This does not cover all the complications which could arise; complications which will provide a real paradise for lawyers, let alone the Restrictive Practices Court.
    For what it is worth, I fully support it. A man who has been carrying on a perfectly friendly business with people in the past and has always received cash will suddenly, under the terms of this Bill—without the Amendment—find himself breaking various of its provisions simply because he carries on his same old practice. In that case we shall have the extraordinary position of a supplier possibly having to refuse to accept cash in payment because to do so would immediately, bring him within the ambit of the prohibitions of the Bill.

    531
    The whole thing is quite ridiculous, in going too far in one direction, but not far enough in another. I hope that my hon. Friend will persuade the Government, who have many more resources to draw upon in framing Amendments even than has my hon. Friend the Member for Crosby, that they ought to make the Clause comprehensible.
    What the Committee is really trying to do is to anticipate the job of the Restrictive Practices Court.
    Mr. J. J. Mendelson: I should support the Amendment in the Division Lobby because it does a number of things that ought to be done and avoids a number of dangers. But my support would be somewhat reluctant, because I also believe that it does a number of things which it should not do. On the whole, I would prefer the Minister to accept the spirit of the Amendment and agree to bring in a similar Government Amendment at a later stage.
    There are a number of aims which the Committee must have in mind in dealing with the Bill. The main difficulties are created by the nature of the Clause. I have much sympathy with the point of view expressed by my hon. Friend the Member for Nelson and Colne (Mr. S. Silverman), who is not with us at the moment, but who, I thought, made an interesting and useful contribution to the debate. He pointed out, in reference to the claim made by the hon. Member for Crosby (Mr. Graham Page), that if the Amendment were not accepted it would be impossible for a supplier to refuse to grant credit either to an actual or a potential customer, that the refusal could not be narrowed down to reasons concerning credit-worthiness or lack of credit-worthiness.
    I accept the logic of what my hon. Friend has said. That is precisely why I am reluctant to support the Amendment. Whether or not it was the intention of the hon. Member for Crosby—and I am not trying to open his heart and mind in such detail as to find whether or not it was—the Amendment would have the additional effect of allowing suppliers who wish to support resale price maintenance to continue to adopt practices which they have used in the past.
    532
    There is involved in our discussion what is called in American legislation the "most favoured customer condition," under which, to enforce certain monopoly positions, a firm or supplier, covering up his real intention, applies either to an actual customer or a potential customer whom he suspects of not maintaining the price that he wishes to see maintained—although that actual or potential customer remains as creditworthy as ever—an inhibiting condition, not allowing the customer to have goods on credit terms, simply because he wishes to apply a sanction, or a form of punishment, because he does not like what the retailer or customer is doing in selling his goods. I would not support that aim.
    On the other hand, we are anxious to make this badly drafted Bill as well balanced as possible, and we do not want to impose unreasonable conditions upon a manufacturer or wholesaler. In the end, in the absence of any assurance from the Minister of State that he accepts the principle of the Amendment, I would go into the Division Lobby with the hon. Member for Crosby. But it is essential in approaching these matters that we should be careful not to throw out the baby with the bathwater by insisting that certain dangers should be prevented and certain improvements should be introduced, losing sight of the fact that it is not our purpose to make it easier for manufacturers to enforce conditions.
    I support the principle of making it easier to pass on to the final customer any savings made in distribution. Because I support that principle I would not like to see any conditions introduced in future legislation which would give the manufacturer the whip hand and make it more and more difficult for the retailer to pass on any savings in distribution to the consumer.
    Therefore, although, on this limited Amendment, it is difficult to go further into the background of the Clause without being out of order, I want it to be clearly understood that in supporting the Amendment, if we have to, we are not satisfied that it will guard against some of the dangers. It will put some matters right which should be put right and it will introduce better balancing features in what is an unbalanced part of the

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    Bill. But it will also not be desirable legislation, because it will not make it easier to pass on savings in distribution.
    Mr. du Cann: There is some support for the Amendment among some of my hon. Friends, and I appreciate their feelings. On the other hand, the Amendment has received somewhat qualified support from hon. Members opposite—from the hon. Member for Sheffield, Hillsborough (Mr. Darling), and particularly from the hon. Members for Nelson and Come (Mr. S. Silverman) and Penistone (Mr. Mendelson), who rightly pointed out that there are substantial objections to it as it stands.
    During the last debate that we had, which dealt with a rather narrow but important point, I attempted to give my hon. Friends—and particularly those whom I knew to be bothered about the matter—some reassurance, although in doing so I went slightly beyond the rules of order. I had hoped that in this debate we might avoid the need for clarification and explanation of what the Clause does.
    However, as that has not happened, I must repeat the explanation that I gave previously, namely, that under the Clause as drafted the supplier is entitled to impose whatever terms he wishes when he supplies his goods so long as he does not offer significantly less favourable terms to a retailer just because he is cutting prices, or is likely to do so.
    In a very clear speech my hon. Friend the Member for Crosby (Mr. Graham Page) quoted a specific example, where supplier A supplies to B, who is a confectioner, and another confectioner, C, then asks A for supplies, and it so happens that A knows that C is a price cutter and is virtually insolvent—or there is some other reason why A does not wish to supply to C.
    There is a dual position. He particularly quoted the instance of insolvency. But I think that he and other hon. Members who have taken part in the debate should consider a much wider range of choice of reasons why A might not wish to supply C.
    7.0 p.m.
    Mr. Cole: May I ask my hon. Friend whether has C been a purchaser from A before?
    Mr. H. Lever: That does not matter.
    Mr. Cole: I should particularly like my hon. Friend to address himself to that question.
    Mr. du Cann: I do not want to mislead my hon. Friend the Member for Bedfordshire, South (Mr. Cole), but I do not think that that really matters in this instance. Let me go on with the point.
    So we have a position when A should supply C and A does not want to. The fact that C is a price cutter is largely irrelevant if there are other good grounds existing which make A feel that it would be quite wrong, as a matter of ordinary commercial business prudence, to supply C, and he may justifiably withhold supplies.
    Mr. Graham Page: My hon. Friend says that it is largely irrelevant, but it is not. Under Clause 4(4) he is then presumed to have unlawfully withheld goods.
    Mr. du Cann: I realise that my hon. Friend the Member for Crosby is interested in the provisions of Clause 4. He did point out, when making his speech, that he could not, obviously, go into that matter in any detail and I am similarly inhibited from replying to him at any length. But I heard hon. Members say that the words
    "unless the contrary is proved"
    appear in Clause 4. That would cover the situation that my hon. Friend has in mind.
    I am not talking about right or wrong or the burden of proof. I am merely saying that under the situation as it is in the Bill as drafted at present, the position about which my hon. Friends are so concerted is covered. Perhaps I may go a little further and say that the supplier is completely at liberty to insist on cash terms in all his agreements if he wishes. He is also completely at liberty to offer credit terms to some dealers and cash terms to others where there is some ground—other than price cutting—for doing so. But what the Clause says—and rightly, in the view of the Government—is that he must not offer credit terms to some dealers and insist on cash from others, merely because they are actual or likely price-cutters.

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    To continue. In so far as the Amendment permits supplies to be refused except on cash terms, on grounds not connected with price cutting, it is unnecessary. But the Amendment goes a good deal wider, as I have suggested and as has been pointed out by other hon. Members, particularly by the hon. Member for Nelson and Colne. In so far as it permits this to be done, even on prohibited grounds, it cannot be accepted by the Government, because it goes too wide. I am sure that my hon. Friend will understand that point.
    To sum up what I have been attempting to say. I recognise the anxieties of my hon. Friends the Members for Crosby, Twickenham (Mr. Gresham Cooke), Bedfordshire, South, Harrow, Central (Sir P. Bishop) and Buckinghamshire, South (Mr. Ronald Bell). I can assure them that the points which they have made, if I have understood them correctly, are covered in the Clause. I realise that to some extent my hon. Friends would wish to discuss the matter further when we come to Clause 4, but I suggest that that is another subject.
    I am prepared to go as far as this: we certainly should be willing, in the light of the discussion, to look at the Clause again with a view to tabling an Amendment. The object of the exercise, as I understand it, on the part of hon. Members on both sides of the Committee, is primarily to make sure that the Bill is clear.
    My right hon. Friend the Secretary of State made clear during the Second Reading debate that the Government are always ready to look at constructive suggestions relating to this Measure and I have already accepted one Amendment today. If we table an Amendment we hope that nothing in the Clause would be construed as preventing a supplier of goods from withholding supplies, or offering supplies on different terms to different dealers, where the reason for doing so is not because a dealer has cut, or is threatening to cut, the price of the suppliers goods. In the light of what I have said, I hope that my hon. Friend will feel that we are anxious to meet him, but will understand that it is not possible for me to meet him in relation to the Amendment which he has tabled. I hope therefore that he will seek to withdraw his Amendment.
    Mr. Jay: I do not feel that the answer of the Minister of State is good enough. He has not offered to amend the Bill in any way. He intends to reword it so as to make clear that it means what he thinks that it means already. The position will still be that the onus of proof will be on the manufacturer, if he withholds his supplies, to prove that he had some motive for so doing other than the fear of a price reduction by the retailer. In that case, he will still, so far as I can see be under a compulsion to give exactly the same terms of credit to that retailer, unless he can substantiate in court that his motives were something which somebody else says that they were not.
    The Deputy-Chairman: Mr. Bell.
    Mr. Maxwell-Hyslop: Before my hon. Friend continues—
    The Deputy-Chairman: I did not call the hon. Member for Tiverton (Mr. Maxwell-Hyslop).
    Mr. Ronald Bell: I think that my hon. Friend has slightly misunderstood some of the points which we put to him. I realise that the burden of proof is in Clause 4. If my hon. Friend will look at Clause 4(4), he will see that it is a definition Clause relating to Clause 2; or perhaps it would be more accurate to say that it relates to proceedings brought against the supplier of goods in respect of a contravention of the provisions of Clause 2. So the implications of Clause 4(4) have to be looked at in relation to the affirmative provisions of Clause 2.
    We cannot merely pass Clause 2 in its present form and then deal with things like the burden of proof when we come to Clause 4. Then it will be too late to go back to Clause 2. I am sure that my hon. Friend the Member for Crosby (Mr. Graham Page) put down his Amendment to draw attention to the effect of the definition in Clause 4 on the operation of the provisions of Clause 2(3,a). I think that is the point at issue.
    Of course, were we told that the Government were proposing a radical alteration to Clause 4 which would remove the fears we have about Clause 2, we should be happy about Clause 2. But at present we have to assume, in accordance with the rules of order, that Clause 4 will remain as it is and we have to look at

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    Clause 2 in the light of Clause 4. That being so, what is troubling me—I must speak only for myself—is that a supplier is put in the position that he must supply credit, perhaps to a new customer, unless he can prove that he is not refusing it because of some price-cutting activities. I do not think that my hon. Friend was phrasing it quite correctly. He said it was crystal clear that a supplier could refuse supplies, or demand cash, provided that was not done because a man was price-cutting.
    Mr. MacDermot: "Merely because".
    Mr. Bell: It is not a question whether it was not done "merely because", but whether he can prove it. That is the point which is worrying us. It is not actually the Restrictive Practices Court which is concerned, that was a slip of the tongue on my part. It is the Queen's Bench, where he has to go as a defendant and affirmatively proved that it was not so. That is a point which is worrying us and I wonder whether my hon. Friend the Minister of State would address his mind to the question of the man having to give credit unless he could prove that he brings himself within Clause 2.
    Mr. Paget: The point which the Minister of State seemed entirely to ignore is that either the abolition of r.p.m. has an effect or it has not. If it does, it changes to that extent the nature of the trade. It may change the nature of the trade by increasing the turnover, or in some other of a variety of ways, but by changing the nature of the trade it changes the credit-worthiness of the shopkeeper who is the buyer. It therefore makes the supplier offer credit when he is facing a changing trade with perhaps a much larger turnover.
    This, to my mind, is fundamentally wrong, because if he withholds credit because the change of selling at cut prices has changed the credit situation that is caught precisely by the Clause. This is the very situation which the Minister says he will preserve. He has not met the case for the Amendment at all.
    Mr. Maxwell-Hyslop: I want to remind my hon. Friend the Minister of State that I did not hear him deal with the point on export contracts signed in this
    538
    country. The Amendment affects the whole of the Clause, of which this is a subsidiary part, and I was anxious that my hon. Friend should either confirm or deny that, to quote from Clause 2
    "…a dealer seeking to obtain them for resale in the United Kingdom…"
    where an export contract is signed in the United Kingdom is covered by the Clause.
    This is a point which exercises us considerably. I do not believe that it was in the minds of those who drafted the Clause but I believe that it would be a consequence of it. We must, therefore, bear in mind when considering the Amendment whether there will be complications there.
    Mr. H. Lever: The Minister of State has said understandably that he desires to avoid clarification of the meaning of the Clause, but, happily, he has not succeeded in that object. He has made it crystal clear that any Amendment that he has in mind for the Clause will be one of clarification. What I seek, and hon. Members generally seek, is not that he should make the mischief clearer legislatively speaking, but that he should abolish it by accepting the Amendment which has had almost universal sympathy on both sides of the Committee. The hon. Gentleman has given no assurance which comforts in any way any fear expressed from any quarter of the Committee. If the Committee does not support the Amendment, any trader can be or may be required in practice to give credit to any dealer whom he has never seen before and who comes along and demands credit.
    Mr. A. Bourne-Arton: Surely that can apply only to a dealer who has cut the price of those goods.
    Mr. Lever: All that the dealer has to do is to go to the supplier and put him in an embarrassing position by telling him, if he did not already know, "I am the man who has been cutting the price of your goods in the last few months." Apart from establishing this bad relationship between the supplier and the client, the Clause will enable a complete stranger to the supplier to insist upon a most favourable position in regard to credit and everything else.
    Sir D. Glover: How can a person who has been obtaining goods for some months be a total stranger to him?
    Mr. Lever: He may be a total stranger, because he may have been getting the goods from somebody else. It is enough that he tells the manufacturer that he intends to sell the goods below price to put the supplier in great difficulty. Until the onus of proof is decisively shifted it means that every supplier who wants to refuse supplies to a cut-price trader must see his lawyer, because the dice would be loaded by statute hopelessly against him once the man who gets credit takes the elementary precaution of telling him that he is a price-cutter.
    How can the Committee pass a Clause, not on the assurance that the Minister will look at it and put a mischief right, but in the knowledge that he will repeat the mischief and if we give him a little time he will tighten the Clause and make clear that this extraordinary monstrosity will continue?
    7.15 p.m.
    Mr. du Cann: The hon. Member appreciates that the point which he is making relates to Clause 4. I appreciate the connection between Clauses 4 and 2 and, as the right hon. Member for Battersea, North (Mr. Jay) has said, we have not yet reached Clause 4. On the other hand, the hon. Member talks about the monstrous position in which the dealer is put. Would he not agree that the first thing that has to happen in an action of this sort is that either the dealer or the Crown has to prove that supplies have been withheld? That is the first burden. The supplier would be required to show that supplies were not withheld simply on the ground of price-cutting, which is very different from the suggestion, which I think the hon. Member is making, that the burden on the supplier is intolerable.
    Mr. H. Lever: The whole debate has been heard by the Committee and the hon. Gentleman omits to mention that the Government provides in the Bill a definition of what amounts to withholding supplies and that a supplier can be held to be guilty of withholding supplies even if he has actually supplied the goods. This is part of the meaning of the Clause.
    540
    I should like to make one comment to hon. Members, and particularly my hon. Friends who feel that somehow or other the purpose of the Bill is frustrated if we do not legislate quite uniquely this novelty that the supplier must grant credit to all and sundry against his will, provided that he supplies some people. Let us suppose that we want to abolish discrimination against coloured people in public houses. I can well understand hon. Members, of whom I would be one, legislating that a publican must supply beer to a man whether he is coloured black, white or yellow. But I cannot see any hope of our enacting that he should supply the beer, whether he likes it or not, and give the man credit, whether he likes it or not, on the ground that he gives other people credit and that his failure to do this would be contrary to the purposes of the Bill.
    The whole thing is preposterous nonsense. It is such an ill-considered novelty that I hope that the Committee will be rough, brutal and to the point when we come to vote on it.
    Mr. R. H. Turton: I cannot agree with the hon. Member for Manchester, Cheetham (Mr. H. Lever) that my hon. Friend the Minister of State has not given a concession. He has definitely given a concession which goes some way, but in my view not sufficiently near to what the Amendment purports to do. I gather that my hon. Friend proposes to insert at a later stage of the Bill a provision which will make clear that, if the goods are withheld on the ground merely that the dealer is not credit-worthy, that will take the supplier out of the mischief of the Clause. But it may well be that the reason for withholding the goods is a deduction from the price-cutting method of the dealer that he is not credit-worthy. Probably the Amendment is not entirely satisfactory as drafted, but this is a point which, it seems to me, ought to be met.
    Some older hon. Members will recollect that before the war there was a chocolate price-cutting war. Many small dealers were cutting the price of chocolate and then, about three months later, going bankrupt. This was common throughout the country, and it was greatly to the detriment of the chocolate trade, because eventually it meant that prices went up. This is the kind of situation in

    541
    which a manufacturer will say, "I shall not sell to dealers X, Y, Z, who are price-cutting people and who are breaking the chocolate trade". But the reasons for saying it would be, first, that they were not credit-worthy and, secondly, that their methods of price cutting were such as to lead to that conclusion.
    I hope that in the interval between now and the Report stage my hon. Friend will try to make the Clause, which is not entirely satisfactory, deal with such a position as that. I gather that he is not completely satisfied with Clause 4 and that he will be receptive to the ideas which we put forward when we reach that Clause.
    Mr. Graham Page: If I had to weigh the evils of the supplier using the refusal of credit for the ulterior motive of refusing supplies to an under-cutter against the evil of depriving the trader of his right to decide whether to sell his goods on cash, I should plump for the former evil.
    My hon. Friend said, in effect, that we must wait for Clause 4 and do something about it then. I cannot be put off like that. I am presented with the case in which the price-cutter goes to the supplier and says, "I am a price-cutter and I want goods on credit because you have been supplying another dealer on credit". Surely there are two grounds. The supplier says, "The fact that this man is an under-cutter, of course, affects my mind. I cannot honestly say that it does not. But the main point is that I want cash for the goods from a man like that".
    Clause 4(4) refers to the ground for refusing supplies. My hon. Friend said that he might consider a provision which said that it shall not be unlawful withholding if it is merely on the grounds of credit. But if there are these two factors, even though credit may be the major factor, a man may say, "Under-cutting affected my mind". He then comes under Clause 4(4) and has to go to the Court and possibly has to defend a claim for demages by the under-cutter who has been unable to obtain his goods.
    I want a much better assurance from my hon. Friend than he has given us so far. I am glad to see my right hon. and learned Friend the Attorney-General
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    on the Front Bench, because he will appreciate the legal points involved. I do not want to go over the arguments all over again, but it is a very serious matter to set out in the Bill that there will be occasions on which a man cannot freely decide whether he shall require cash for his goods and that he can decide it only by going to his solicitor, who will obtain counsel's opinion, and then fighting it out in the Court. This is not what we should impose on people by the Bill, and before I ask the Committee to give me leave to do anything I hope that my hon. Friend will rise again and give us a far better assurance.
    Mr. Cole: My hon. Friend the Minister of State is always so courteous that it is difficult to criticise him, but I understand the position to be this: there may be four or five reasons, all of them good, including the possibility of price cutting or the fact of past price cutting, for which a supplier does not supply goods to a dealer, and in that event either the dealer or the Crown can take him into the Queen's Bench Division and start an action. It was not clear to me that the Crown has the onus to prove that withholding—not unlawful withholding but withholding of goods—has taken place between the supplier and the dealer.
    Mr. Graham Page: The Crown does not come into this. There are no criminal proceedings. These are civil proceedings by the person who says that he has been injured by the goods being withheld.
    The Attorney-General (Sir John Hobson): Clause 4 provides that either the dealer or the Crown can bring proceedings. There may be a situation in which the Crown has decided to bring proceedings when the individual dealer is a person who could not possibly face proceedings of this nature.
    Mr. Cole: I see that I am in good company in my remarks. But I am not so much worried about that as about the supplier finding himself in the Queen's Bench Division facing a charge. Whoever has initiated the prosecution must prove that there has been withholding of supplies, which I imagine would not be too difficult. I want the Committee to use its imagination and to imagine that the court has accepted this

    543
    fact: not simply that there has been no delivery or that deliveries have been banned or that there has been slackness, but that there has been a deliberate action of withholding delivery. That must be a problem for the court.
    There may be four or five different reasons why the dealer has withheld the supplies. Let us be frank: one reason may be that the goods have been cut in price in the past or that there is good reason to believe that they will be cut in selling price by the dealer in future. There may be other reasons, not only credit-worthiness but the number of outlets in the town and the fact that it is an area in which the supplier prefers not to sell his goods as it may be unsuitable. There may be a hundred and one reasons, including that in the Amendment.
    The onus of proof is on the supplier to prove his motive, and it is almost the most difficult thing in the world to prove in any court the motive that someone had. Someone said in my company the other day, "Some of the greatest errors are committed with the best of intentions." This may well be true in this case. First, there is the withholding of supplies, and then the Crown has as one of its causes—otherwise it would not have brought the case—the fact that the dealer has been selling goods below price or attempting to do so and that this is the reason why the supplier will not supply him.
    The supplier must first eliminate the charge on the basis of cut prices. Having proved that that was not the motive for his action, he must prove that one or two of half-a-dozen reasons was the motive for his action. I do not know who will decide—either the dealer or the Crown—whether it is worth while bringing a case. But let us assume that the Crown or the dealer has proved that there has been a physical withholding—or, in deference to the hon. Member for Manchester, Cheetham (Mr. H. Lever), a theoretical withholding—of supplies within the confines of the Act. When all that has been finished and there is an admission on both sides that the dealer has been dealing in cut-price goods, or was about to do so, the supplier must prove to the satisfaction of
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    the Court that his action was taken for other motives.
    This is an impossible situation. I am not a lawyer, but I can see that it would be a paradise for lawyers arguing on both sides. I do not know whether the Amendment would go far enough, but it might at least help a little. The very fact that we have gone so far as to invite the attention of the judges of the Queen's Bench Division to other causes seems to be a good reason for adding as many reasons as we can for their consideration.
    7.30 p.m.
    Mr. du Cann: First, I am grateful to my right hon. Friend the Member for Thirsk and Malton (Mr. Turton) for what he said. I think that the point he had in mind would be covered, but we will certainly look at it specifically.
    Secondly, I do not want to "pull the leg" of my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) too hard, particularly as our constituencies are neighbouring. The point he raised about exports really concerned the last Amendment. I considered it then, but it did not seem to me to be fully relevant, even on that Amendment. I appreciate that my hon. Friend raised a serious point. I do not believe that the point is of particular relevance to this matter. I think the anxieties he expressed are largely unfounded.
    Thirdly, I have been asked to go a little further. I have given a very clear undertaking, but my right hon. Friend the Secretary of State has now authorised me to say that, as we come to have our discussion on Clause 4, which we all agree has a bearing on the matter, we shall certainly consider what has been said now and what is said on Clause 4 when considering the question of this Clause and the decisions that we have come to about it.
    I hope that is clear. I hope, also, that it takes account of the points which have been made and which we recognise are important, particularly in the minds of my hon. Friends.
    Mr. Graham Page: My hon. Friend the Minister of State has, to put it vulgarly, got me scared now, because I know that, if I called a Division now, I could probably defeat the Government.

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    This has been made clear by what has been said by my hon. Friends and by the support the Amendment has received from hon. Members opposite. I do not want to do that. It is the last thing I want to do, but my hon. Friend is driving me to put the Amendment to a Division.
    Hardly a speaker has opposed the Amendment. Those who have not supported it wholeheartedly have finished by saying that they support it with qualifications. I am not one of those who are modest about drafting. I think that the Amendment says what I intended it to say. I think that it is a good one. It may need provisos. Those can go in later. We do not know how hurried we shall be over later stages. If I get this into the Bill now, someone else can put the provisos in later. If I do not get this in now, I do not know whether I shall be steam-rollered later.
    I am placed in the most difficult position, as practically the whole Committee has supported the Amendment and I believe would support it on a Division. Again, I press my hon. Friend the Minister of State, my right hon. Friend the Secretary of State, and my right hon. and learned Friend the Attorney-General to see the points which have been made during the debate and give us a better assurance than we have been given so far.
    Mr. Cole: Would it help my hon. Friend—if it does not, he will not do it—[Laughter.] I am trying to be fair; I can do no more. Will my hon. Friend ask my right hon. Friend to give an undertaking that he will consider redrafting the Clause?
    Sir D. Glover: My right hon. Friend knows that I am broadly in favour of the abolition of resale price maintenance and that I have gone out of my way to support him on numerous occasions. I have not heard the whole debate but I am not satisfied with the assurances given by my hon. Friend the Minister of State. If we cannot be given better assurances, I shall be in great difficulty if the Amendment is pressed to a Division.
    It appears clear from listening to all the lawyers who have spoken that, as the Clause is drafted, it will be a lawyers' paradise. If that happens, the Bill will
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    fail in its purpose. Any manufacturer or supplier has an enormous responsibility to safeguard his shareholders' money. The only person who can make a decision about credit-worthiness is the manufacturer or supplier. There should not be overriding conditions weighting his judgment.
    I know of cases in my practical experience when we have restricted credit to a firm which may have been paying our accounts promptly when we have received information that others were not receiving quick settlements of their accounts. As the Clause is drafted, I would have no right to restrict credit if my account was being paid promptly, despite the fact that I was receiving information which made me very dubious indeed about the customer's creditworthiness.
    I do not think that anything said by my right hon. and hon. Friends so far has removed the fear that many of us have about what will happen if the Clause as drafted goes on to the Statute Book. I hope that my right hon. Friend will give an assurance to my hon. Friend the Member for Crosby (Mr. Graham Page), who moved the Amendment with great ability, that the spirit of the Amendment, if not its exact words, will be incorporated in the Bill before it leaves this place.
    The Secretary of State for Industry, Trade and Regional Development and President of the Board of Trade (Mr. Edward Heath): I must apologise to the Committee for the fact that I have not been able to hear the whole of the debate, but I am aware of the context of the Amendment. My hon. Friend the Minister of State has given an undertaking to my hon. Friend the Member for Crosby (Mr. Graham Page). I do not wish to go into the merits of the argument on the Amendment. Broadly speaking, we believed that the point raised by my hon. Friend was satisfactorily covered by the Bill. My hon. Friend and some hon. Members opposite do not believe this to be the case.
    My hon. Friend the Minister of State has given a firm undertaking that we will, therefore, look at the matter again. This is a normal thing during a Committee stage. I am quite prepared, as always, to say that we will study every

    547
    word which has been said in the debate. We will then have the opportunity of taking action upon it, because our objective is the same. As I understand it, my hon. Friend is not asking that the supplier should have the right to withhold supplies purely because the dealer is a price cutter. That is what we are concerned with.
    My hon. Friend is concerned with other aspects of that—the difficulties which arise because the supplier wants to withhold supplies on other grounds, including, as I understand it, the ground that the man might not be creditworthy because he was cutting prices. He has given that specific example.
    The firm undertaking I am giving to the Committee is that we are now quite prepared to look at the whole of this matter again. I believe that that is a reasonable thing for my hon. Friend the Member for Crosby to have asked and a reasonable thing for me, as Minister in charge of the Bill, to say. We have listened with great care and attention to all the arguments put forward. I hope that we can agree that we are honourable people who want to deal with this problem satisfactorily.
    Mr. Graham Page: I feel that we are now making some progress. If my right hon. Friend will say that in looking at the matter again he will look at the question of putting this in Clause 2, I am sure that the fears of many hon. Members will be allayed. The Minister of State referred to our having to wait until we got to Clause 4. If my right hon. Friend will think about this in the context of revising Clause 2, I think that that would satisfy my hon. Friends and me.
    Mr. Heath: The Minister of State dealt with this matter and pointed out that there were obviously separate problems concerning Clause 4 which hon. Members would want to discuss, because this deals with the question of the onus of proof, how an action is to be brought and so on. On this matter of Clause 2, my hon. Friend has given an undertaking on my behalf—an honourable undertaking—that we will consider every word that has been said and that we will look at the matter from this point of view because our objectives are
    548
    the same. I do not think that, in Committee, I can be asked to give a firmer or clearer undertaking.
    Mr. Jay: Will the right hon. Gentleman say what he is undertaking? Is he undertaking to amend the Bill in the sense that the hon. Member for Crosby (Mr. Graham Page) is asking?
    Hon. Members: Answer.
    Mr. Ronald Bell: I apologise for speaking again, but a few words might be helpful in the interest of clarity. My right hon. Friend referred to a clear undertaking which, I admit, seemed to be clear to me. However, he also referred to an undertaking which had been given by the Minister of State. The undertaking we were given until the point when my right hon. Friend rose was simply that everything that had been said would be carefully borne in mind when we came to Clause 4. That was the only undertaking we had been given, and I want that to be clear.
    We felt that there were great difficulties about that, because if when we came to Clause 4, the Government were not convinced of the merits of our arguments, we could not go back to Clause 2. However, if my right hon. Friend is now giving an undertaking that we were not given before—and that everything which has been said this afternoon will be considered in relation to Clause 2 as well—then that is a different matter and I think that my hon. Friend the Member for Crosby (Mr. Graham Page) would feel differently about the issue. We have not had that undertaking and unless my right hon. Friend is meaning to give it I fear that things will be made very difficult.
    Mr. Heath: This is an Amendment of my hon. Friend the Member for Crosby (Mr. Graham Page) to Clause 2 and what I said in my statement was that we will carefully study that Clause and his Amendment. If we are, as I believe we are, trying to reach the same objective, then if we have not already done that in the Bill as it is drafted I hope that we will be able to do it. That is a clear undertaking which I am giving.
    Mr. Hirst: We are certainly making some progress now, although we must have the matter clear. I appreciate that

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    my right hon. Friend is trying to be helpful and I agree that he has said that he will consider this matter, I hope in relation to both Clauses 2 and 4. I want to know whether my right hon. Friend accepts the principles which have been enunciated by my hon. Friend the Member for Crosby (Mr. Graham Page), because that is at the heart of the matter. We want to be assured that in considering the subject generally my right hon. Friend has the principles in mind.
    7.45 p.m.
    Mr. Heath: My hon. Friend is not being as fair as he usually is. I have said that we will take into account the whole of the situation described by my hon. Friend the Member for Crosby. I do not believe that it is reasonable, in Committee, to say that in taking into consideration everything that has been said in the debate I am, therefore, automatically committing myself to a particular course of action. It is not fair to ask, in Committee, that I should do that.
    I am entitled to take everything stated by my hon. Friend the Member for Crosby into account. I believe, from my previous study of the Amendment and of the Bill, that we are trying to reach the same objective. If now my hon. Friends have shown that we have not reached that same objective, then there is very good reason for amending Clause 2—and I must now be given the opportunity to consider the matter and deal with it at another stage of the Bill, because that is what the other stages are for.
    Mr. Paget: What is the objective? As I understand it, the objective of the hon. Member for Crosby (Mr. Graham Page) is simply that suppliers should not be compelled to grant credit unless they want to; whatever their reasons for demanding cash they should be entitled to demand it unconditionally. That being the objective of the hon. Member for Crosby, is it the objective of the right hon. Gentleman?
    Hon. Members: Answer.
    Mr. Hirst: I am trying to be fair. I can assure my right hon. Friend that whenever I have spoken on this subject I have been absolutely fair. My right hon. Friend considers that we have a common objective, but have we? I do
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    not think that we have. I do not wish to be unfair but, honestly, we would not have tabled the Amendment and this whole debate, for all these hours, would not have taken place and the principles of the matter would not have been discussed at such length if we had a common objective.
    I am sorry, and I say this with regret, but it appears that a large number of hon. Members feel that this common objective does not exist; or should I say that the Government do not appear to have the common objective of a large number of hon. Members? I appreciate that we are in Committee. I know all about Committee stage work and I am aware of our procedures, but my right hon. Friend surely accents that it is normal in Committee, on Finance Bills and other Measures, for Ministers to say that they accept the principle of the point being raised and will find words to put it into effect. If that is not forthcoming I am sorry to say that my right hon. Friend must see that we have a suspicion that our common objective is not there.
    Mr. MacDermot: I must press the right hon. Gentleman to make exactly clear just what is this common objective. He himself said that he has not been present throughout the debate. He appears—at least, the Minister of State appeared—to assume that if a supplier withholds supplies there must be only one motive activating him in that decision. The Bill appears to be drafted with that assumption in mind because it talks about a supplier withholding supplies in that way.
    The basis of the argument adduced in support of the Amendment is that one will frequently get a situation where a supplier is acting from mixed motives. If he is honest he will say that one of his motives is that the dealer is likely to be engaged in price cutting. Another is that he suspects the credit-worthiness of the dealer. The right hon. Gentleman and the Government must face up to this situation. What is their intention in this situation? Is it that the supplier shall be entitled to say, "Because one of my motives is genuinely that I suspect this man's credit-worthiness, I am insisting on cash?" Will a supplier be allowed to say that? If not, what is the common objective?
    Mr. Heath: Perhaps I might try again to help the Committee, I asked my hon. Friend the Member for Crosby (Mr. Graham Page) if he wished to create a position in which a supplier could withhold goods from a dealer solely on the ground that he was selling below the recommended price, to which my hon. Friend replied, "No." That was not the situation he wished to create and, therefore, we have a common objective. I said, as I understood it, that the discussion had been about the circumstances in which other factors arose, including that he might wish to take into account the fact that the man had been selling below the recommended price as a factor in deciding his credit-worthiness.
    I said that our objective was the same. We also wish to meet that situation. I am advised on this matter that, legally, the position is that if there are other reasons, then that is sufficient, because there are other reasons by which the man is making his decision. He is doing it on that basis and I believe, therefore, that we have the same objective in trying to get the Clause clear.
    It has been suggested that in Committee one must always accept the principle involved. With respect, that is not the case. On innumerable occasions Ministers, in Committee, say that they will thoroughly examine everything that has been said and will if they can, assist the Committee in reaching a proper solution. The Minister in charge of a Bill is entitled to say that, and that is the undertaking I have given.
    Mr. Hirst: I did not mean "always" when I referred to the acceptance of principles in Committee stages, but it is not unusual or exceptional for a Minister to accept the principle and then try to find words to put it into practice.
    Mr. Heath: I have tried to show the objectives we are trying to reach in the Bill and to give my hon. Friend the Member for Crosby the clearest and firmest undertaking. I will study everything he has said and try to reach the objective we have outlined. That is the sort of undertaking, as Minister in charge of the Bill, I can and should give.
    Mr. H. Lever: We have to get this clear. The objective that the hon. Member for Crosby (Mr. Graham Page) was
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    to see that manufacturers and suppliers had the unconditional and unqualified right not to give credit on the sale of their goods. That was what the debate was about. Are we to understand that the Secretary of State is to consider sympathetically restoring to the suppliers the unconditional right to withhold credit on any grounds that they like, including that of price cutting? If he is not giving that undertaking, then he is giving no undertaking at all.
    Mr. Cole: I am prepared to accept my right hon. Friend's undertaking. I believe that he is seized of the point made not only by my hon. Friend the Member for Crosby (Mr. Graham Page), but of a variety of other cases which ought to be within the right of the manufacturer, even if the question of price cutting does not exist at all. I am quite sure that my right hon. Friend will take consideration of that. What was frightening me and, I believe, frightening many hon. Members on both sides of the Committee was that whatever is in Clause 2, either now or on Report, it will be viable once it is passed.
    Clause 4 has a bearing on it, because it will look like a contradiction of what is laid down in Clause 2. That is what was worrying us. If we get Clause 2 right, I do not think that there will be much to worry about on Clause 4.
    Sir Stephen McAdden: I am sure that my hon. Friends have been much encouraged by the attitude of my right hon. Friend, and that we appreciate the way he has proceeded on this issue. We also appreciate the very ready way in which he has given a commitment that he will study this matter most carefully. I only hope that, after due consideration, if he finds it necessary to amend Clause 2, he will bear very clearly in mind that there are Members on both sides of the Committee who will take the strongest possible exception to any legislation being enacted which laid it down that the manufacturer had to allow credit to people even if he did not think that they were credit-worthy. As long as my right hon. Friend is considering legislation in that form, he will satisfy his hon. Friends on this side of the Committee.
    Mr. Winterbottom: In view of the fact that in this Clause equality between

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    retailers and wholesalers on conditions of credit is already provided for, may I point out to the Minister that the only issue he has to decide is the simple principle that everybody accepts in this country—the right of anyone to refuse to give credit? That is a principle that ought never to have been introduced into the question of resale price maintenance. It is confusing the issue and making it much more difficult not only for wholesalers and retailers, but, seemingly, also for hon. Members.
    I want the Minister to face that simple issue and give us the assurance here and now that he will give an undertaking that in no way, shape or form will he, through the Bill, interfere with the inalienable right of a person to refuse to give credit.
    Mr. William Shepherd: Under the law, as I understand it, I, as a supplier of goods, can refuse to supply anybody even on the ground that I do not like the look of his face. I imagine that, apart from the restrictions imposed upon me by the Bill, I shall be able to continue to refuse to
    supply goods to Mr. Jones because I do not like the look of his face.
    I am very anxious that my right hon. Friend should not widen the provisions of the Bill so that evasion becomes possible. I have some reservations about the Bill in general terms, but I am more concerned that we do not launch ourselves once more into anti-monopoly legislation which becomes abortive. Starting with the Act introduced by the Labour Government in 1948, we have had a string of Measures which have not been properly effective. I hope that my right hon. Friend, in considering all aspects of the question, will bear in mind the absolute necessity of not providing loopholes whereby people can evade the purpose of Parliament.
    Mr. Graham Page: I accept entirely my right hon. Friend's statement that he believes that our objectives are the same. On that basis, I beg to ask leave to withdraw the Amendment.
    Hon. Members: No.
    Question put, That those words be there inserted:—
    The Committee divided: Ayes 164, Noes 244.

    Division No. 54.]

    AYES

    [7.57 p.m.

    Ainsley, William

    Edwards, Walter (Stepney)

    Irving, Sydney (Dartford)

    Allen, Soholefield (Crewe)

    Evans, Albert

    Jay, Rt. Hon. Douglas

    Awbery, Stan (Bristol, Central)

    Finch, Harold

    Jenkins, Roy (Stechford)

    Barnett, Guy

    Fitch, Alan

    Jones, Dan (Burnley)

    Bence, Cyril

    Foot, Michael (Ebbw Vale)

    Jones, Elwyn (West Ham, S.)

    Benn, Anthony Wedgwood

    Forman, J. C.

    Kenyon, Clifford

    Benson, Sir George

    Fraser, Thomas (Hamilton)

    Lawson, George

    Blackburn, F.

    Galpern, Sir Myer

    Lee, Frederick (Newton)

    Blyton, William

    George, Lady Megan Lloyd (Crmrthn)

    Lee, Miss Jennie (Cannock)

    Bottomley, Rt. Hon. A. G.

    Ginsburg, David

    Lever, Harold (Cheetham)

    Bowen, Roderic (Cardigan)

    Gordon Walker, Rt. Hon. P. C.

    Lewis, Arthur (West Ham, N.)

    Bowles, Frank

    Greenwood, Anthony

    Lipton, Marcus

    Braddock, Mrs. E. M.

    Griffiths, David (Rother Valley)

    Loughlin, Charles

    Bradley, Tom

    Griffiths, Rt. Hon. James (Llanelly)

    Lubbock, Eric

    Bray, Dr. Jeremy

    Griffiths, W. (Exchange)

    Mabon, Dr. J. Dickson

    Broughton, Dr. A. D. D.

    Grimond, Rt. Hon. J.

    McBride, N.

    Brown, Rt. Hon. George (Belper)

    Hale, Leslie (Oldham, W.)

    MacDermot, Niall

    Butler, Herbert (Hackney, C.)

    Hamilton, William (West Fife)

    McLeavy, Frank

    Butler, Mrs. Joyce (Wood Green)

    Harper, Joseph

    MacPherson, Malcolm

    Carmichael, Neil

    Hart, Mrs. Judith

    Mallalieu, J.P.W. (Huddersfield, E.)

    Castle, Mrs. Barbara

    Hayman, F. H.

    Manuel, Archie

    Chapman, Donald

    Henderson, Rt. Hn. Arthur (Rwly Regis)

    Mapp, Charles

    Corbet, Mrs. Freda

    Herbison, Miss Margaret

    Mellish, R. J.

    Craddock, George (Bradford, S.)

    Hill, J. (Midlothian)

    Mendelson, J. J.

    Crosland, Anthony

    Hilton, A. V.

    Millan, Bruce

    Crossman, R. H. S.

    Holman, Percy

    Milne, Edward

    Cullen, Mrs. Allce

    Holt, Arthur

    Monslow, Walter

    Darling, George

    Houghton, Douglas

    Morris, Charles (Openshaw)

    Davies, Harold (Leek)

    Howell, Charles A. (Perry Barr)

    Moyle, Arthur

    Davies, S. O. (Merthyr)

    Howie, W.

    Mulley, Frederick

    Deer, George

    Hughes, Cledwyn (Anglesey)

    Neal, Harold

    Dempsey, James

    Hughes, Emrys (S. Ayrshire)

    Noel-Baker, Francis (Swindon)

    Diamond, John

    Hughes, Hector (Aberdeen, N.)

    Oliver, G. H.

    Dodds, Norman

    Hunter, A. E.

    O'Malley, B. K.

    Doig, Peter

    Hynd, H. (Accrington)

    Oram, A. E.

    Driberg, Tom

    Hynd, John (Attercliffe)

    Oswald, Thomas

    Duffy, A. E. P. (Colne Valley)

    Irvine, A. J. (Edge Hill)

    Padley, W. E.

    Paget, R. T.

    Pannell, Charles (Leeds, W.)

    Silkin, John

    Tomney, Frank

    Parker, John

    Silverman, Sydney (Nelson)

    Wade, Donald

    Pavitt, Laurence

    Skeffington, Arthur

    Wainwright, Edwin

    Peart, Frederick

    Slater, Mrs. Harriet (Stoke, N.)

    Warbey, William

    Pentland, Norman

    Slater, Joseph (Sedgefield)

    Weitzman, David

    Prentice, R. E.

    Small, William

    Wells, William (Walsall, N.)

    Price, J. T. (Westhoughton)

    Smith, Ellis (Stoke, S.)

    White, Mrs. Eirene

    Probert, Arthur

    Sorensen, R. W.

    Whitlock, William

    Pursey, Cmdr. Harry

    Soskice, Rt. Hon. Sir Frank

    Wigg, George

    Randall, Harry

    Spriggs, Leslie

    Wilkins, W. A.

    Rankin, John

    Steele, Thomas

    Williams, W. T. (Warrington)

    Redhead, E. C.

    Stones, William

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

    Rees, Merlyn (Leeds, S.)

    Strauss, Rt. Hn. G. R. (Vauxhall)

    Winterbottom, R. E.

    Robinson, Kenneth (St. Pancras, N.)

    Swain, Thomas

    Woof, Robert

    Rodgers, W. T. (Stockton)

    Swingler, Stephen

    Wyatt, Woodrow

    Rogers, G. H. R. (Kensington, N.)

    Symonds, J. B.

    Ross, William

    Taverne, D.

    TELLERS FOR THE AYES:

    Royle, Charles (Salford, West)

    Thompson, Dr. Alan (Dunfermline)

    Mr. Grey and Mr. Ifor Davies.

    NOES

    Amery, Rt. Hon. Julian

    Emery, Peter

    Kitson, Timothy

    Arbuthnot, Sir John

    Emmet, Hon. Mrs. Evelyn

    Langford-Holt, Sir John

    Ashton, Sir Hubert

    Errington, Sir Eric

    Leather, Sir Edwin

    Atkins, Humphrey

    Erroll, Rt. Hon. F. J.

    Legge-Bourke, Sir Harry

    Awdry, Daniel (Chippenham)

    Farr, John

    Lewis, Kenneth (Rutland)

    Barber, Rt. Hon. Anthony

    Fell, Anthony

    Linstead, Sir Hugh

    Barlow, Sir John

    Finlay, Graeme

    Litchfield, Capt. John

    Batsford, Brian

    Fisher, Nigel

    Lloyd, Rt. Hon. Selwyn (Wirral)

    Bevins, Rt. Hon. Reginald

    Fraser, Rt. Hon. Hugh (Stafford & Stone)

    Longbottom, Charles

    Biffen, John

    Fraser, Ian (Plymouth, Sutton)

    Loveys, Walter H.

    Biggs-Davison, John

    Freeth, Denzil

    Lucas, Sir Jocelyn

    Bingham, R. M.

    Galbraith, Hon. T. G. D.

    Lucas-Tooth, Sir Hugh

    Birch, Rt. Hon. Nigel

    Gammans, Lady

    McAdden, Sir Stephen

    Black, Sir Cyril

    Gardner, Edward

    MacArthur, Ian

    Bossom, Hon. Clive

    Gilmour, Ian (Norfolk, Central)

    McLaren, Martin

    Bourne-Arton, A.

    Gilmour, Sir John (East Fife)

    Maclean, Sir Fitzroy (Bute & N. Ayrs)

    Box, Donald

    Glover, Sir Douglas

    Macleod, Rt. Hn. Iain (Enfield, W.)

    Boyd-Carpenter, Rt. Hon. John

    Glyn, Dr. Alan (Clapham)

    McMaster, Stanley R.

    Boyle, Rt. Hon. Sir Edward

    Godber, Rt. Hon. J. B.

    Macmillan, Maurice (Halifax)

    Braine, Bernard

    Goodhart, Philip

    Maitland, Sir John

    Brewis, John

    Gower, Raymond

    Markham, Major Sir Frank

    Brooke, Rt. Hon. Henry

    Grant-Ferris, R.

    Marples, Rt. Hon. Ernest

    Brown, Alan (Tottenham)

    Green, Alan

    Marshall, Sir Douglas

    Bryan, Paul

    Gresham Cooke, R.

    Marten, Neil

    Buck, Antony

    Gurden, Harold

    Mathew, Robert (Honiton)

    Bullard, Denys

    Hall, John (Wycombe)

    Matthews, Gordon (Meriden)

    Bullus, Wing Commander Eric

    Hamilton, Michael (Wellingborough)

    Maude, Angus (Stratford-on-Avon)

    Butcher, Sir Herbert

    Harrison, Brian (Maldon)

    Maudling, Rt. Hon. Reginald

    Campbell, Gordon

    Harrison, Col. Sir Harwood (Eye)

    Mawby, Ray

    Carr, Compton (Barons Court)

    Harvey, John (Walthamstow, E.)

    Maxwell-Hyslop, R. J.

    Carr, Rt. Hon. Robert (Mitcham)

    Harvie Anderson, Miss

    Maydon, Lt.-Cmdr, S. L. C.

    Cary, Sir Robert

    Hastings, Stephen

    Mills, Stratton

    Channon, H. P. G.

    Hay, John

    Miscampbell, Norman

    Chataway, Christopher

    Heald, Rt. Hon. Sir Lionel

    Montgomery, Fergus

    Chichester-Clark, B.

    Heath, Rt. Hon. Edward

    Morgan, William

    Clark, Henry (Antrim, N.)

    Henderson, John (Cathcart)

    Mott-Radclyffe, Sir Charles

    Clark, William (Nottingham, S.)

    Hiley, Joseph

    Neave, Alrey

    Clarke, Brig. Terence (Portsmth, W.)

    Hill, Mrs. Eveline (Wythenshawe)

    Nicholson, Sir Godfrey

    Cole, Norman

    Hill, J. E. B. (S. Norfolk)

    Noble, Rt. Hon. Michael

    Cooke, Robert

    Hobson, Rt. Hon. Sir John

    Nugent, Rt. Hon. Sir Richard

    Cooper, A. E.

    Hocking, Philip N.

    Orr, Capt. L. P. S.

    Cooper-Key, Sir Neill

    Hogg, Rt. Hon. Quintin

    Orr-Ewing, Sir Ian (Hendon, North)

    Cordeaux, Lt.-Col. J. K.

    Holland, Philip

    Osborn, John (Hallam)

    Corfield, F. V.

    Hopkins, Alan

    Page, John (Harrow, West)

    Courtney, Cdr. Anthony

    Hornby, R. P.

    Pannell, Norman (Kirkdale)

    Craddock, Sir Beresford (Spelthorne)

    Hornsby-Smith, Rt. Hon. Dame P.

    Partridge, E.

    Crawley, Aidan

    Howard, Hon. G. R. (St. Ives)

    Pearson, Frank (Clitheroe)

    Crosthwaite-Eyre, Col. Sir Oliver

    Hughes Hallett, Vice-Admiral John

    Peel, John

    Curran, Charles

    Hughes-Young, Michael

    Percival, Ian

    Currie, G. B. H.

    Hulbert, Sir Norman

    Peyton, John

    Dalkeith, Earl of

    Iremonger, T. L.

    Pickthorn, Sir Kenneth

    Dance, James

    Irvine, Bryant Godman (Rye)

    Pike, Miss Mervyn

    d'Avigdor-Goldsmid, Sir Henry

    Johnson, Eric (Blackley)

    Pitman, Sir James

    Deedes, Rt. Hon. W. F.

    Johnson Smith, Geoffrey

    Pitt, Dame Edith

    Digby, Simon Wingfield

    Jones, Arthur (Northants, S.)

    Pounder, Rafton

    Doughty, Charles

    Joseph, Rt. Hon. Sir Keith

    Powell, Rt. Hon. J. Enoch

    Douglas-Home, Rt. Hon. Sir Alec

    Kaberry, Sir Donald

    Price, David (Eastleigh)

    Drayson, G. B.

    Kerans, Cdr. J. S.

    Price, H. A. (Lewisham, W.)

    du Cann, Edward

    Kerby, Capt. Henry

    Prior, J. M. L.

    Duncan, Sir James

    Kershaw, Anthony

    Prior-Palmer, Brig. Sir Otho

    Eden, Sir John

    Kimball, Marcus

    Proudfoot, Wilfred

    Elliot, Capt. Walter (Carshalton)

    Kirk, Peter

    Quennell, Miss J. M.

    Elliott, R. W. (Newc'tle-upon-Tyne, N.)

    556

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    Ramsden, Rt. Hon. James

    Spearman, Sir Alexander

    Vaughan-Morgan, Rt. Hon. Sir John

    Rawlinson, Rt. Hon. Sir Peter

    Speir, Rupert

    Vickers, Miss Joan

    Redmayne, Rt. Hon. Martin

    Stevens, Geoffrey

    Vosper, Rt. Hon. Dennis

    Rees-Davies, W. R. (Isle of Thanet)

    Stoddard-Scott, Col. Sir Malcolm

    Walder, David

    Renton, Rt. Hon. David

    Studholme, Sir Henry

    Walker, Peter

    Ridsdale, Julian

    Summers, Sir Spencer

    Walker-Smith, Rt. Hon. Sir Derek

    Rippon, Rt. Hon. Geoffrey

    Tapsell, Peter

    Ward, Dame Irene

    Roberts, Sir Peter (Heeley)

    Taylor, Sir Charles (Eastbourne)

    Watkinson, Rt. Hon. Harold

    Rodgers, John (Sevenoaks)

    Taylor, Frank (M'ch'st'r, Moss Side)

    Webster, David

    Roots, William

    Temple, John M.

    Whitelaw, William

    Russell, Sir Ronald

    Thatcher, Mrs. Margaret

    Williams, Dudley (Exeter)

    Sandys, Rt. Hon. Duncan

    Thompson, Sir Richard (Croydon, S.)

    Williams, Paul (Sunderland, S.)

    Scott-Hopkins, James

    Thorneycroft, Rt. Hon. Peter

    Wilson, Geoffrey (Truro)

    Sharples, Richard

    Thornton-Kemsley, Sir Colin

    Wolrige Gordon, Patrick

    Shaw, M.

    Tilney, John (Wavertree)

    Wood, Rt. Hon. Richard

    Shepherd, William

    Touche, Rt. Hon. Sir Gordon

    Woodhouse, C. M.

    Skeet, T. H. H.

    Turner, Colin

    Worsley, Marcus

    Smith, Dudley (Br'ntf'd & Chiswick)

    Turton, Rt. Hon. R. H.

    Smyth, Rt. Hon. Brig. Sir John

    Tweedsmuir, Lady

    TELLERS FOR THE NOES:

    Soames, Rt. Hon. Christopher

    van Straubenzee, W. R.

    Mr. Hugh Rees and Mr. More.

    Mr. Hirst: I beg to move Amendment No. 26, in page 3, line 20, at the end to insert:
    (4) For the purposes of the foregoing subsection a dealer shall be deemed not to be carrying on business in similar circumstances to other dealers in relation to any goods, if the supplier can require the dealer to purchase such goods from the supplier or his nominee.
    This Amendment deals with a situation very different from that which we have just been discussing. I think that it will be a little easier to deal with and will, I trust, engender rather less heat and allow people to recover a little. The Amendment raises a quite separate issue. I shall be reasonably happy, because it is a rather difficult point, if the Minister who is to reply will, at least, agree to have some discussion with me between now and Report if he finds that the Amendment is not acceptable at present.
    It is a separate issue, and, as I see it, the Amendment does not invalidate the principles of the Bill. As I understand it—I suppose that I do understand a bit about it by now—this Resale Prices Bill is put forward with the intention that there should be action to ensure that, as far as is conceivably possible, apart from unfair practices, there will be free or substantially more competition. This is the basis of what we have been discussing. It is laid down perfectly clearly in the Explanatory Memorandum.
    In the lawyers' battle we have had for the past two hours, some of us may have forgotten what the actual meaning is. I have enjoyed the battle, of course; these things are always instructive. However, I am not a lawyer. I am a simple soul who is now bringing forward a point which affects quite a number of people who have special forms of trading.
    558
    We are not trying in any way to circumvent the Bill or its objects, but it has seemed for a long time that there are various advantages in arranging one's business in different ways. There are several trades concerned here.
    I have been very frank with hon. Members at all times—I think that both sides of the Committee will agree with that—in indicating any interests which I may have in the subject under discussion. I do not have very great interests, but I should like to make it clear that I have a modest interest in some items concerning resale price maintenance. Some of the firms with which I am connected, although in a very non-executive capacity, have an interest in this matter, and I wish to make, that clear.
    There is a reasonable purpose behind the Amendment. People may provide certain services or capital for development or other facilities and, therefore, by reason of that their trade is not quite similar—in other words, they are not trading in entirely similar circumstances. I see the validity—and whether I like it or not has not very much to do with it—of the phrases which have been used about trading in similar circumstances and provisions, as under Clause 2, for other measures for maintaining resale prices. People who are not carrying on business in similar circumstances, while in no way desiring to do anything which is irregular or which is against the spirit of the Bill, could be carrying on a practice which might be unlawful, because in its wisdom the Board of Trade has not, perhaps, had time to consider every peculiarity of every form of trading.
    I do not think the Amendment needs much explanation. Anyone can understand its wording without much trouble.

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    Therefore, I do not want to labour the point. I will explain it at greater length if necessary, but I think that my hon. Friend the Minister of State is seized of the point and of the unusual situation that certain traders are in. They are not trying to do anything irregular. For many years they have found it convenient to trade in such a way that certain advantages are given on one side in return for advantages created on the other side. The public has been the gainer in many ways by reason of this sort of relationship. No one desires to do anything which is against the spirit of the Bill.
    Mr. Maxwell-Hyslop: The Amendment does not commend itself to me. I can see that there may be circumstances such as those to which my hon. Friend the Member for Shipley (Mr. Hirst) alluded in which it might serve a useful function. But there is certainly one function which it could perform and with which I have very little sympathy. It would enable breweries, for instance, to charge their tenants in tied houses higher prices for liquor supplied to them than they charge to other retailers—for instance, those in free houses or off-licence premises. The balance of advantage as between the owners of public houses and the tenants of public houses should be struck in a different way from making the tenant, who has many statutory conditions to meet and very long hours to work, pay more for the liquor which he cannot buy anywhere else except from the owner of the public house unless the brewery gives him permission to do so.
    We should be careful to examine the implications of this and to make sure that they are implications with which we want to live. I am not sure that they are implications with which I want to live. The off-licence merely has to suit its own commercial advantage. People in off-licences have no obligation to be open for a certain number of hours a day, although there is a limit to the number of hours that they can be open. The free house—that is, a house which is not owned by a brewery—can purchase its liquor where it is most advantageous, which the tenant of a public house cannot do.
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    8.15 p.m.
    There is an increasing tendency in the licensed trade, which I deplore, even though economic circumstances may tend to advance it, for the individual landlord to be replaced by a manager. There is often a great loss of atmosphere when this happens. One way to squeeze tenants out and to replace them with managers is to make the economic conditions under which they operate quite intolerable. One way of doing that is to make the tenant pay an unreasonable additional amount for his supplies than his competitors so that he cannot meet his rent and provide himself with a reasonable living, so that he throws in his hand and is replaced by a manager.
    I do not suggest that this is a universal trend, but it is, unfortunately, a practice which there is reason to suppose exists.
    Mr. R. J. Mellish: Is it not a fact that if a tenant works extremely hard and pushes up the sales in his public house, instead of getting a letter from the brewers saying, "Well done, faithful servant", he gets his rent increased?
    Mr. Maxwell-Hyslop: That may be the case, but I have not come across examples of it.
    Mr. Mellish: It happens in London all the time.
    Mr. Maxwell-Hyslop: I have come across the opposite case, namely, of tenants giving up because they are not able to conduct the business profitably and thus to give the service which they should give to the public.
    Because I think that the Amendment would tend to accelerate that process rather than to discourage it, I could not give it my support. I recognise, however, that there might be many other trades in which considerations of this kind could legitimately be encompassed. For instance, if a manufacturer supplies equipment to test and service the machines which he makes, I suppose that it might be reasonable that a person, when buying in supplies, should pay a bit more. It would be much more reasonable to say that if the retailer wanted facilities provided by the manufacturer he should pay directly rather than in a peculiar side way. This would seem to be more logical.
    Mr. J. Hynd: I have no prejudice one way or another on this Amendment. I want to ask one or two questions for clarification and to ask the hon. Member for Tiverton (Mr. Maxwell-Hyslop) whether there is not another side to the coin.
    I accept the abuses of the tied house system to which he referred and recognise that they exist, but are there not many examples, not only in the licensing trade but concerning petrol stations and things of that kind, where this system permits of people being able to run these stations and to make a profit out of them, or out of the pub, as the case may be, who would not be able to do so, not having the capital, but this being provided by the parent concern on conditions which would necessarily provide for the benefit thus given?
    As to the terms of the Amendment, I am in the same difficulty as on the previous one, which achieved nothing. As the mover or seconder of that Amendment admitted, a further Amendment was necessary to achieve what was desired. This Amendment seems to me to be completely redundant.
    Subsection (3,a) of the Clause refers to people
    "carrying on business in similar circumstances".
    If the circumstances were so dissimilar as in the case of tied public houses, petrol stations or other instances, I should think that the situation would be covered by subsection (3,b). That is my interpretation. If that is not the case, I should like to have the difference explained and to know whether there is any purpose in the Amendment.
    Mr. du Cann: I was interested to hear what my hon. Friend the Member for Shipley (Mr. Hirst) said in moving the Amendment. If its wording is to indicate one relevant factor which would be ground for saying that one dealer was not carrying on business in similar circumstances to another, the Amendment is not strictly necessary. Clearly, any special relationship between a dealer and a supplier would be a good reason for saying that a dealer was not carrying on business in similar circumstances to other dealers. The Amendment, however, goes a good deal beyond that, as my hon. Friend will recognise, and, therefore, for that reason, I cannot accept it.
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    My hon. Friend, who is a very old friend of mine in many ways, always tries to be frank with the House of Commons. Perhaps I can try to be frank with him and say that whether he and I disagree, as we obviously do substantially on certain occasions, plainly we do not disagree in the context of this matter.
    As to the Amendment, my hon. Friend said that it was not his intention in any way to invalidate the principles of the Bill, and I accept that from him at once. In those circumstances, and having regard to what I have said, if my hon. Friend would be good enough to withdraw the Amendment, which simply cannot be accepted—the hon. Member for Sheffield, Attercliffe (Mr. J. Hynd) was quite right about that—I shall be ready to agree to discuss it with him in the context of the discussion that we have had today, in which my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) has also joined. I note what he, too, has said.
    Mr. Hirst: I am grateful to my hon. Friend for giving me what I asked. I will be grateful to have those conversations with him, because this is a matter which needs careful study. With that assurance, I should like to ask leave to withdraw the Amendment.
    Mr. W. Wells: I should like to add a word before the Amendment is withdrawn. It was by no means as clear in its wording as the hon. Member for Shipley (Mr. Hirst) said. It is sometimes said that these proceedings are a lawyer's paradise. From the point of view of one lawyer at least, they are purgatory.
    Mr. Cyril Bence: It is a lawyer's jungle.
    Mr. Wells: I accept that, too.
    What is clear from this debate, and what I suspected before it began, was that whether or not the form of words was clear in itself, the types of transaction to which the Amendment is intended to apply are far from clear. Nor did the hon. Member for Shipley make clear to the Committee how his Amendment would affect the types of transaction which he did not describe.

    563
    It is clear, as my hon. Friend the Member for Sheffield, Attercliffe (Mr. J. Hynd) said, that the Amendment relates to many transactions right outside the scope of the licensed trade, and my hon. Friend gave a number of examples. During the course of the Bill, there have been many conversations, upstairs, downstairs and nearly everywhere except on the Floor of the House of Commons. My eyes are not impious to peer behind the curtains which hide the transactions of the party opposite—
    Mr. Hirst: The Amendment relates to a wide form of trading. I have not tried to bring the matter down to a detailed argument. My hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) mentioned one industry which is affected. The hon. and learned Member for Walsall, North (Mr. W. Wells) realises, I trust, that the field is a wide one and that the circumstances in each case are somewhat dissimilar, but that all of them would, possibly, be considered to be affected by the term "similar circumstances".
    Mr. Wells: My difficulty is to understand what the commercial purpose behind the hon. Member's Amendment might be. Therefore, my hope is that if an Amendment to this effect is put down at a later stage of the Bill—although I hope that it will not be—there will be a full explanation of the intended purport of these transactions and that the House, as it will then be, will be informed fully of the scope and commercial purpose of what the hon. Member for Shipley is seeking to achieve. We on this side will not oppose the withdrawal of the Amendment and are inclined to hope that it will disappear once and for all.
    Mr. Arthur Lewis: When the Minister replied, he suggested to his hon. Friend the Member for Shipley (Mr. Hirst) and, I think, to his hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) that he would be prepared to discuss the matter with them. I should like to make a suggestion. Why cannot the Minister discuss it with my hon. Friend the Member for Ebbw Vale (Mr. M. Foot) and with my hon. and learned Friend the Member for Walsall, North (Mr. W. Wells)? If there is an
    564
    interest in the matter and if any of my hon. Friends wants to be sure that the Amendment is a good one, before anything is done for the Report stage the Minister could do no better than discuss the matter with the legal brains on this side of the Committee—they are very much lacking on his own side—and then we might make progress.
    Mr. du Cann: I am obliged to the hon. Member for giving way. All I was going to say was that it is generally known and understood, I think, that the Minister is always ready to see hon. Members who wish to put points to him. Certainly, I shall be very happy to accept the hon. Member's suggestion and see him any time.
    Mr. Lewis: I was only trying to help the Minister, because there is a lack of legal knowledge on that side of the Committee, whereas on this side we have an abundance of it. I thought that I would help the Government with the suggestion that they should come to see some of my legal hon. Friends to get out of some of their difficulties.
    8.30 p.m.
    Mr. Charles Loughlin: It is the common practice in Committee, when an Amendment has been submitted and the Minister has a degree of sympathy with it, for the Minister to agree to discuss it generally with the Member on the Opposition side of the Committee responsible for it; and he is usually the one who is leading for the Opposition. But when an Amendment comes before the Committee then it becomes the Committee's property, if my contention is right, and not the property of the Member who moved it. It is reasonable for the Committee to give its blessing—I nearly said its permission, but that is, perhaps, too strong a word—to discussions, if the Committee knows precisely what the Amendment seeks to do.
    The hon. Member for Shipley (Mr. Hirst) said that he is always straight with the Committee, always explains himself in clear language so that we know what he means. I will accept that, but in putting forward this Amendment he has, if I may respectfully suggest it to him, fallen a little short of his practice, because he said afterwards—he subsequently intervened to say the

    565
    same thing—that there were a whole host of trades where these practices obtain, where, in addition to ordinary trade practices, certain services were provided by the manufacturer to the retailer.
    Then another Member on that side of the Committee helped the hon. Gentleman by pointing to the question of tied public houses. Then an hon. Member on this side helped a little further by talking about the question of petrol stations and the provision of capital—by agreement, perhaps, with the landowners—for the development of petrol stations when the petrol owners did not have the capital so to develop. My hon. and learned Friend the Member for Walsall, North (Mr. W. Wells), speaking from our Front Bench, thought there had been a host of trades mentioned in the debate. Frankly, I must have dozed off to sleep, because I heard no more than those two instances which were given. The hon. Member for Shipley, in his intervention, talked about a host of people.
    I do not know how my hon. Friends stand in relation to the Amendment. It may be that I am not too bright, and that they all understand precisely what this is about and how far it will have any ramifications at all in distribution. They may not. I do not know. I am, at least, a member of the Committee, and I think that I ought to know, if someone is asking me either to support a proposal, or alternatively—
    Mr. Bence: Acquiesce or withdraw.
    Mr. Loughlin: I am very sorry that my hon. Friends wish to make the speech for me. I can assure them I shall not be more than a minute or two, and then they can carry on their argument.
    However, before these proposed discussions take place with the approval of myself, I think that we ought to hear from the mover of the Amendment precisely what it is all about, because if we do not, we shall have some discussions, and then at a subsequent stage we shall have the mover of the Amendment coming along and putting an equally vague and indistinct case, and the Minister will say, "The House will remember that on a night when we were in Committee we discussed this matter
    566
    and I offered to discuss it with my hon. Friend, and having done so, I hope that the House will agree to its being accepted."
    Many hon. Members—I include myself in this—are perhaps a little modest and rather afraid of saying, "We do not know what this is all about; please tell us." It would be wrong for the Committee to agree to the withdrawal of the Amendment before we have a fuller explanation of it.
    Mr. Leslie Hale: I greatly regret intervening in a fairly able speech, but my hon. Friend the Member for Gloucestershire, West (Mr. Loughlin) should bear in mind that the Bill was presented by the party opposite as one of the great reforms of the final Session of this Parliament. There are seven Conservatives present at the moment and when the hon. Member for Shipley (Mr. Hirst) comes to ask our leave to withdraw the Amendment perhaps he will be able to tell us whether or not he has consulted his 320 other colleagues, some of whom support the Bill and many of whom do not. They were not in the Chamber while he made his important contribution and they are not here now.
    Mr. Loughlin: That is a point of some substance, but my hon. Friend the Member for Oldham, West (Mr. Hale) overlooks the fact that there have been other consultations among the colleagues of the hon. Member for Shipley (Mr. Hirst). Before the last Division there were some very strong consultations indeed between the Patronage Secretary and those likely to vote against the Government.
    We should hear a little more from the hon. Member for Shipley about this. I appreciate that, on other occasions, he always completely "comes clean" with the Committee. If I admire him for nothing else it is that he has a little more courage than many of his colleagues.
    Amendment negatived.
    Question proposed, That the Clause, as amended, stand part of the Bill.
    Mr. Douglas Jay: We now come to discuss the main issue at stake in this Clause. It is, perhaps, a pity that we have been attempting, on

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    and off, to discuss it in relation to certain detailed points which have arisen on the various Amendments. However, that was possibly inevitable. The discussions have shown the difficulties we get into when we try to enact by legislation that certain people shall trade with other people with whom they do not wish to trade, which is what we are doing in Clause 2.
    This Clause substantially prevents a supplier from withholding supplies in certain circumstances from a dealer. One can express that either in the form of preventing supplies from reaching a dealer, or of withholding supplies, or of forcing the supplier to provide supplies to somebody with whom he does not wish to trade.
    Mr. A. Lewis: My hon. Friend the Member for Oldham, West (Mr. Hale) drew attention to the fact that only seven hon. Members opposite were present when he was speaking. Will my right hon. Friend the Member for Battersea, North (Mr. Jay) mention that there are now only three, which shows the interest in the Bill of the party opposite?
    Mr. Jay: On the whole, I would rather not waste time doing that. I was trying to explain, to such Members as are present, what the Clause means.
    Mr. Hale: On the whole, we are discussing a Measure which has occupied the time of the House of Commons for 2½ days. With great respect, my right hon. Friend should not dismiss the fact that there are now only four Tory back benchers present at twenty minutes to nine when we are discussing the most important Clause of the Bill. I do not think that it is right to discuss it with such attendance. It would be open to call for a Count, but that would be futile, as hon. Members would come back into the Chamber.
    Surely we should not make light of the fact that on a Bill which has attracted so much attention throughout the country—I have never thought that it was so important and do not suggest that I do now, but the Committee has been asked to regard it as important and has been asked to spend 2½ days on it—there are only four Tory Members of Parliament present on the back benches and three who are here in pursuance of offices to
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    which an absentee Prime Minister has appointed them.
    Mr. Jay: I assure you, Sir Samuel, that I do not dismiss it, but I thought that it was more likely to be obvious to our eyes than to our ears.
    Mr. A. Lewis: But that is not much good to HANSARD.
    Mr. Jay: I return to the Bill and draw attention to the fact that what the Clause asks us to do is to forbid a manufacturer to withhold supplies from a dealer in certain circumstances. That is to say, it forces a manufacturer or wholesaler in these circumstances to trade with people with whom he does not wish to trade. In the nature of the case, that is a fairly drastic thing to do and not something which we would often do by legislation.
    The second point to which I draw attention is that it forces him to supply goods not merely to someone with whom he does not wish to do business, but also to somebody with whom he has never before done business. When I said this on Second Reading, the Secretary of State shook his head and appeared to deny that this was the case, but I am glad to find that it is now generally admitted that it is. It follows from the wording of Clause 4(4,a)—which I cannot discuss now, but which we are compelled to mention so as to understand this Clause—that Clause 2 says that a supplier must not withhold goods on the ground that a dealer has been cutting prices—to put it in crude terminology—or is likely to do so.
    When we reach Clause 4, we will find that he is presumed to have acted from this motive when two conditions are satisfied. The first, which appears in Clause 4(4,a), is that down to the time when supplies were withheld the supplier was doing business with the dealer, or, was supplying goods of the same description to other dealers. That word "or" makes it plain that by Clause 2 we compel people in certain circumstances to trade with some retailer of whom they may never have heard until this moment and with whom he has never before done business. Whether this is right or not, that is what we are being asked to do.
    To see this in perspective, one must set it against the background. Until

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    1956, it was the law that a manufacturer could withdraw his supplies from a retailer either through the collective boycott, in company with other manufacturers, or individually on his own initiative, if he so chose. In the 1956 legislation it was thought right that the collective boycott should be abolished. Since that legislation, although the manufacturer could no longer apply the collective boycott, he has been at perfect liberty to withhold his supplies as he chose, and could not be compelled to trade with a retailer with whom he had no wish to trade.
    8.45 p.m.
    We on this side of the Committee have no objection to abrogating the other part of the 1956 Act which gave the manufacturer power to enforce his prices on a retailer against the retailer's will. In our view that went much too far in interfering with the freedom of choice both of the retailer and of the consumer. But that we are, in effect, reversing in Clause 1. I was going to say that that is what we are repealing in Clause 1, but that is not strictly correct.
    Let us be clear what the 1956 Act gave the manufacturer, so that we can understand what we are doing. It gave him the right to enforce his prices on a retailer, whatever those prices were, without any authority having control over those prices.
    Mr. H. Lever: And whether the retailer had bought them direct from him or had given an undertaking in relation to himself or not.
    Mr. Jay: Certainly.
    I think that it was my hon. Friend the Member for Manchester, Cheetham (Mr. H. Lever) who, in our earlier debates, said something about his being against nineteenth century Liberalism. I do not think that one has to be against that to agree at least with this part of the Bill, so far as it goes in reversing Section 25 of the 1956 Act, for this reason, that whether or not one believes in price competition, I cannot think that it is right to forbid price competition by law. That is really what the previous Act did, and what we are doing now is to remove from the Statute Book the provision which forbade price competition.
    When we come to Clause 2, I think that it is essential to make a distinction
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    between the procedure of establishing the onus of proof which applies to Clause 1, and the procedure for establishing the onus of proof in Clause 2 where we are laying on the manufacturer this new obligation to supply people whom he does not want to supply.
    I hope that hon. Gentlemen realise that throughout the Bill as it stands the onus of proof is still emphatically on the manufacturer, and not on the Registrar, the public authority, to prove that he is acting in the public interest. That has not in any way been altered by the Amendments that we have made to the Bill.
    I think that one can make a case for that when what the manufacturer is asking—and this is what he is primarily asking when he asks for exemption—is to retain the power that he previously had under Section 25 of the 1956 Act to enforce his price on a retailer against the retailer's will. If the manufacturer is asking for that, I think that a strong case can be made for saying that the onus of proof should be on him.
    The Minister is going further. First, he is taking away the manufacturer's right to invoke the law on his side and to enforce his prices. But—and this is where all the trouble arises in our debates—he is also imposing a new obligation upon the manufacturer or wholesaler to supply retailers whom he does not wish to supply, and whom he may never have supplied before. He can be compelled to do this if it is held that his motive for not doing it is a fear of price cutting on the part of the retailer.
    The Bill goes even further than that. Here again, I must refer to Clause 4, which states that the manufacturer shall be presumed to be acting in this way—that is to say, his motive shall be presumed to be the fear of price-cutting—if two conditions are satisfied: first, that he was previously doing business with the dealer, or was supplying similar traders; and, secondly, that the trader who wishes to do business with him has in the recent past been cutting prices.
    It therefore follows that a retailer can say to a manufacturer, "You have never done business with me and you do not want to do business with me—and, by the way, you may like to know that I am in the habit of making large cuts in

    571
    prices below the recommended prices," and if the necessary conditions are satisfied the manufacturer can be compelled to do business with that retailer, even if he does not wish to do so. The only way of his avoiding it—and here we must look at the end of Clause 4(4)—is for the manufacturer to prove to the contrary. The words
    "unless the contrary is proved"
    mean that the onus is thrown upon the manufacturer to prove that this was not his motive, or not one of his motives.
    My hon. and learned Friend asked the Minister exactly what the situation would be when the manufacturer had more than one motive. We may all have more than one motive for a given action.
    Mr. Shepherd: There may be more than one motive for this speech.
    Mr. Jay: First, he may consider the retailer to be untrustworthy and not wish to trade with him. Secondly, he may think that the retailer is likely to treat his goods as a loss leader. I hope that the Minister will be able to clear up the question of what happens when several motives are operating at the same time. What is quite clear is that we are now asked to enact legislation which compels a manufacturer to trade with a retailer unless that manufacturer can prove that his motives were of a certain kind.
    As the Bill stands, however, the onus of proof is now on the manufacturer in another sense. Nobody has pointed this out, so far. If the manufacturer or wholesaler wishes to obtain exemption for the class of goods in which he deals he has to prove, according to the gateways of Clause 5, that it is in the public interest, for some special reason, that he should be allowed to maintain a certain price for his goods. The onus of proof is upon him. It may be that some case can be made out for the arrangement.
    But the onus of proof is also upon him in a further sense. If he fails to obtain exemption under Clause 5, unless he is to be under an obligation to supply people whom he does not wish to supply he must prove that his primary motive was not a fear of price-cutting. When the matter is argued out to this point, it seems to us that it is a little harsh to lay upon the manufacturer an obligation of this kind.
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    I do not know whether the Committee has realised—I have not heard it pointed out—that there is no reciprocal obligation on the retailer. Some hon. Members may feel inclined at first sight to say that that is all right. They may think in terms of a large monopoly manufacturer—perhaps the Imperial Tobacco Company—and of a small tobacconist with premises in a village street.
    In such a case it may be that there would be no great hardship. But all manufacturers are not large and all retailers are not small. There are plenty of retail combines in this country which are large, wealthy and powerful. Surely, when we are legislating we should not think in terms of favouring the manufacturer against the retailer, or vice versa, but about being fair to all British subjects living in the United Kingdom.
    Mr. J. Hynd: Will my right hon. Friend clarify that point? Is not the retailer in relation to the supplier in the same position as a consumer in relation to a retailer? Is not there a legal compulsion on a retailer to sell to the public but no compulsion on a member of the public to buy from a particular retailer?
    Mr. Jay: If that is so I should like to be shown chapter and verse where it says so.
    As I understand the Bill, at present it merely places an obligation on the supplier, the wholesaler or manufacturer to trade in these circumstances against his will with the retailer. It places no similar obligation on the retailer to trade in comparable circumstances—or, indeed, in any circumstances at all—with the manufacturer.
    There may be many cases, though, admittedly, not a majority of cases, where a manufacturer is small and a retailer large; and I find it difficult to believe that a case has yet been made out for imposing such a sweeping obligation as this on the manufacturer—to trade in the circumstances with someone with whom he does not wish to do business and with whom he has never done business—unless he can go to the Court and prove that his motives were such-and-such to the satisfaction of the Court. Therefore, we find it very difficult to support the substance of the Clause.

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    With the Bill in the condition in which it is at present, our difficulty about procedure is that, in seeking to shift the onus of proof in the matter of Clause 2 and the imposing of an obligation on a manufacturer not to withhold his supplies, we are forced, owing to the peculiarities of the Bill, to amend not Clause 2, but Clause 4. I cannot, therefore, go on to suggest in detail ways in which this must be done. We are in a situation where the Committee has to take a decision on Clause 2—this difficulty has been troubling us all the afternoon—without knowing whether Clause 4 will be amended or not.
    This being the position, it is certainly my view at this time that the only sensible course which the Committee can take is to conclude that the Government have not made out their case for Clause 2 at this stage in this form, in view of the harsh and sweeping obligation which it places on a number of traders. Though we shall certainly seek at a later stage in our discussions on the Bill—and when it is in order to do so—to ameliorate the situation and seek to ensure that in this matter the onus of proof is the other way round—that is to say, the onus of proof is on those who argue that some trader should do business with those with whom he does not wish to do business—we are certainly not satisfied that this Clause in its present form ought to be approved by the Committee.
    9.0 p.m.
    Sir James Pitman: I have a quite minor point on the Clause, to which I hope my hon. Friend the Minister of State will pay attention because rather than speak to the two Amendments which could have been called and might have kept the Committee and my hon. Friend at them for a long time, and since they are merely exploratory at the moment, I thought it better to raise this point on the present Motion.
    I refer particularly to line 14 of subsection (3,a) where it is stated that the terms will not be
    "significantly less favourable than those available to other dealers carrying on business in similar circumstances".
    This is a question of interpretation, because in many trades there are three different terms. There are what are
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    known as occasional discount, bulk discount and personal discount. In the book trade the traveller who comes round for a subscription gives the bookseller what is known as an occasional discount. This is not by any means the usual discount. This is why I wished to insert the words to make the terms not less favourable than "those usually available from him". If that is not the interpretation of the Clause as it stands, or if it may not safely be so, I hope that the Government will consider putting it right on a suitable occasion later on.
    Equally, there is the question of supplying books in bulk. There are normally higher rates of discount if three hooks are ordered than there are when the order is for a single copy. In these circumstances, shall we be involved in an argument as to which discount represents the normal terms? Will it be said that the discount given for a single copy should be applicable? Finally, there is the special arrangement which one makes with a special customer who gives special displays, who is one's special agent and who enjoys what may be called a personal discount. It is important that these questions should be considered in connection with the last three lines of subsection (3,a) where it is stated that the terms must not be
    "significantly less favourable than those available to other dealers…"
    and I would suggest that the word generally" might be added at the end.
    Mr. Paget: It seems to me that one has only to understand what the Bill does in order to appreciate the real absurdity of Clause 2. Clause 1 simply makes contracts, including a resale price maintenance clause, void. It does no more than that. It goes on to state that it shall be unlawful to make these contracts, but "unlawful" is there used simply in the sense that they would be void. It goes no further. It does not say, and it does not provide, that to make these contracts shall be a crime. Indeed, Clause 4(1) makes this quite clear.
    It is no crime to make resale price maintenance contracts, nor is it a civil wrong. If it were a civil wrong, then the agreement to do so would be a conspiracy in the same way as it is a conspiracy to slander or to work a

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    boycott, for example; they are criminal offences because the boycott or the slander, although not a crime, is a civil wrong. But a resale price maintenance contract is not a civil wrong and is not made a civil wrong. It is not unlawful even in the sense of being immoral. If one makes a contract which has an immoral purpose, whether to take a house for a mistress or a house from which to carry out a train robbery, for example, the whole contract is void because of the immorality of the contract. But as Clause 1(3) points out, only the resale price maintenance law is void; the rest of the contract is valid and enforceable.
    May I take a parallel? A resale price maintenance contract is today in exactly the same position as a betting or gambling contract; it cannot be enforced by the courts and it is only an obligation in honour. I have no objection to that. Before the Bill, as a result of Section 25 of the 1956 Act, resale price maintenance agreements were put in a specially privileged position. They were enforceable not as between the parties by the civil law but by criminal sanctions of the criminal law, and they were enforceable not only as between the parties to the contract but even where the goods came into the hands of a third party who was not a party to the contract. I think that that went very much too far.
    We opposed Section 25 of the 1956 Act, and I think that we were right to do so. Now we have lurched rather the other way. We say about these price maintenance contracts that not only shall they not be enforceable by means of the criminal law but that they shall not be enforceable by means of the civil law. But we have gone no further than that. There is nothing wrong with these contracts save that they are unenforceable.
    It is the same position as a betting or gambling transaction. They are obligations in honour, and they remain obligations in honour. By Clause 2 we proceed to say that we shall compel people to deal with the customers whom they have found dishonourable. Let us take the position of a bookmaker. We are not merely saying to the bookmaker, "You cannot enforce this bet in the courts." We are saying to him, "Pro-
    576
    vided only that your customer turns out to be a defaulter, we shall compel you to go on betting with him—and not only if he is simply your defaulter. If he can prove that he is a defaulter with any other bookmaker, we shall compel you to lay bets with him."
    One has only to put it in terms of another contract made void by the law to show how absurd, and indeed immoral, this provision is which requires a man to sell further goods to a man who has defaulted upon an honourable obligation of the trade, no longer enforceable by the law but still there, not forbidden. Is it just to force someone to supply further goods to a man whom he can no longer trust because he has proved himself to be untrustworthy? Is it sensible to force someone to supply goods to a customer whom he has never met, with whom he has had no dealings, if only the customer is in a position to prove that he has been similarly untrustworthy with another supplier? Such business dealings have only to be stated for their absurdity to become apparent.
    Not only is a supplier compelled to deal with these people who are the last people, because they are untrustworthy, with whom he would choose to deal, but he is compelled to give them credit, to make deliveries to them and to do a whole series of things. Over and above this, there is a provision in Clause 4 that this can be enforced upon a man by injunction to be sought by the Attorney-General. I do not imagine that anybody really thinks anything like that will conceivably happen. Does anyone imagine circumstances in which the Attorney-General would go to the Court and demand an injunction that somebody shall supply goods to a third party, with whom he does not want to deal, on credit terms? This has no connection with reality.
    Mr. H. Lever: Why does my hon. and learned Friend suggest that it is inconceivable that this will happen if the Committee is foolish enough to agree to the Clause in its present form?
    Mr. Paget: Merely because, as a matter of practice, I do not believe there ever would be such an occasion. The process of pushing through that sort of proceeding in a court of law would

    577
    simply break down. Somebody might be foolish enough to try it at some point, but I cannot believe that any part of the Clause will work in practice.
    I do not think, in terms of ordinary trade and business, that the obligation to supply a customer whom he does not want to supply can be imposed upon a manufacturer. If a manufacturer applied his mind to seeing how awkward he could make himself to a customer whom he did not want, it would not require much ingenuity to make the position intolerable. This is the sort of doctrinaire essay in unreality which can have no effectiveness on a Statute Book and which makes our whole position absurd even by the effort of putting it there.
    9.15 p.m.
    I sincerely hope that the Clause will be rejected. I dislike the Bill as a whole and would, therefore, like to see the Clause rejected. Other hon. Members may like the Bill in principle, but, whether or not they like it in principle, this kind of invasion of the freedom of choice of people running their own businesses is wholly inconsistent with a free enterprise system.
    As a Socialist, I probably believe in far more regulation than hon. Members opposite, but any form of regulation of a free enterprise system must at least leave an entrepreneur with the freedom to run his business and at least to choose his customers. If one tries to impose certain conditions such as saying, "We order you to deal with certain people you do not like, you do not want to sell to, you do not trust, and to whom you are reluctant to deal in every other way, or you are committing an offence", one is equally committing the offence of being utterly inconsistent with the system one is trying to create. I therefore urge that the Clause be rejected.
    Mr. Ronald Bell: I find myself in the unusual and not likely to be frequently repeated position of agreeing with the hon. and learned Member for Northampton (Mr. Paget). When one remembers that the hon. and learned Member is one of the most well known dirigistes in the Committee, my right hon. Friend may think that if the hon. and learned Member feels that there is an encroachment of personal freedom here, then perhaps there is.
    Mr. Ellis Smith: What did the hon. Member call my hon. and learned Friend?
    Mr. Ronald Bell: A dirigiste. I am am glad to see from the knowledgeable looks on the faces of hon. Members that the word is generally known in the Committee. There is no definition of it in the Bill, but it is a good word.
    I have doubts about the Clause for three reasons, or groups of reasons, the first being on the broad general principle involved. I am not aware of any provision in English law which compels any supplier or maker of goods to sell to anybody. I may be wrong, and there may be one tucked away somewhere, but, generally speaking, the principle on which we conduct our affairs is that if somebody makes an article he is able to sell it or not to sell it as he wishes and thinks fit.
    Mr. Shepherd: Does my hon. Friend agree that, although that has been true since 1956, before that date there were vicious arrangements which restricted supply operated by private enterprise?
    Mr. Ronald Bell: My hon. Friend has raised the point to which I was coming. That was done by the collective withholding of supplies, but the general principle of the law is that people are free to sell or not to sell as they wish to do.
    We have always recognised in our law another principle, a well established one, that things which are perfectly lawful if done by one person may be unlawful if done by a number of people in collaboration, that being a conspiracy. The question of things being lawful and unlawful concerns a very sound and sensible disposition, because it is right that the individual should enjoy a wide freedom of action which it might be tyrannous for a combination of people to enjoy. That is why it was necessary to pass trade union legislation; to give trade unions a degree of freedom to act in collaboration as conspirators which is not enjoyed by other members of the community. It was this collective withholding of supplies, because it was collective, that we outlawed in the 1956 Act. I quite see that it had become oppressive with all the accoutrements of private tribunals and so on which we were familiar with at that time.

    579
    What we are dealing with now is the right of the individual, legal person or company to sell or not to sell as he or it, in its good discretion, thinks right. I am not saying that this is something that is outside the power of the State, because it is not. I am not saying that it is something about which Parliament ought not perhaps at some time to pass laws, but I am saying that this is a field in which Parliament ought to tread with the greatest circumspection and hesitation in considering whether it is not infringing fundamental human freedoms in imposing on the individual limitations of his right to dispose or not to dispose of the products of his labour.
    A thing like this can be done if there is a compelling reason for doing it. I shall, therefore, examine quite soon whether I think that there is a compelling reason for doing it, granted for the moment the purpose which is the purpose of the Bill. For the moment, I accept the proposition that, unless there is a compelling reason made out, this is the sort of thing that the Legislature ought not to do.
    I would then ask: is there a compelling reason why it should be done? I cannot see one. Let us assume that it is right that the practice of resale price maintenance ought to be stopped either altogether or in part. The practice of resale price maintenance depends not merely on the right of A to make a contract with B but on the right of A to make a contract with B and enforce it against C. That was the whole point of resale price maintenance. Without that we could not have resale price maintenance.
    That was also the point of collective action and private tribunals. If A and B made a contract C could laugh at it, C being the actual retailer who finally bought the goods. The manufacturer sold to the wholesaler and the wholesaler sold to the retailer and the retailer could, if he wanted, snap his fingers at any bargain that the manufacturer had made with the wholesaler. Because that was the case, the apparatus of the collective withholding of supplies was brought into force. It was the only method by which resale price maintenance could be enforced. That method—the only method—was abolished in 1956. That was why
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    Parliament, intending to preserve individual resale price maintenance, had to introduce into the 1956 Act Section 25, which gave a right, which never existed before, allowing A to enforce against C the contract which he had made with B. This exists by Section 25 of the Act and not otherwise.
    The whole apparatus of individual resale price maintenance which exists now depends on the machinery and procedure which was created in Section 25 of the 1956 Act. Therefore, if we want to abolish or limit resale price maintenance, all we have to do is either to repeal Section 25 or to say that the procedure created by Section 25 shall be employed only by people who bring themselves within certain exempt categories. This Bill has these exempt categories, and if one brings oneself inside them through the machinery of the Restrictive Practices Court then one can go on practising individual price maintenance and using the machinery under Section 25 which is not repealed by the Bill.
    Why not just say that if a person wishes to apply to the Restrictive Practices Court for exemption he may do so, as provided by the Bill, and may then use the machinery of Section 25, but if he does not do that he may not use it? That would be the end of it. We do not need all the complications of Clause 2, injunctions, arguments about credit, and all the rest.
    If it is said that that would be all right in one context but it would still leave in existence the resale price maintenance contract which has only two parties—manufacturer supplying direct to retailer, or something of that kind—where no third party is brought in, my answer is that Clause 1 has dealt with that. Clause 1 lays down that any provision in a contract for resale price maintenance is void. The whole contract is not void but the resale price maintenance provision is. Therefore, it cannot even be enforced between A and B, as it could be at common law, because we have said that it is void. It cannot be enforced against C because we would say that Section 25 is not available to someone who does not bring himself within the exemptions.
    Does not this cover the whole field? If it does, why do we want Clause 2 with all the complications, vexations, doubts and hesitations which hon. Members on

    581
    both sides have expressed? Why are we castigating ourselves with this complicated business about withholding supplies when the whole thing can be done effectively without it? Some hon. Members may think that I am exaggerating a little when I call it an incursion upon human rights—it is not a phrase which I very much like or tend to use—but it is certainly an encroachment upon a valuable personal liberty.
    On that aspect, I add this further thought, which was touched on by the hon. and learned Member for Northampton. To force people to sell their own goods is harsh anyway, but it is particularly harsh to force them to sell their goods to people with whom they have recently quarrelled, with whom they have recently quarrelled in accordance with the law as it has been and at this moment is, people whom they have taken to court under Section 25 of the Restrictive Trade Practices Act, an Act passed not so long ago and introduced by a Conservative Government.
    Is it right to make such a somersault? I would not grumble at just limiting the application of Section 25. There is no reason why one should not move on to do that. But why strike in this rather savage way through Clause 2 at the suppliers who have done nothing whatever up to now except comply with the laws which we have laid down and take advantage of a law which we have specially created for their benefit? Suddenly, we are switching over 180 degrees and saying, "These people whom you have rightly taken to court up to the date of the Royal Assent shall be entitled to come to you the day after and require you to supply goods to them, on most favoured customer terms, or you will face an action for damages and, perhaps, an injunction".
    Those are the three reasons why I have grave doubts about Clause 2. I do not see why it could not be dropped without any damage whatever to the structure of the Bill or to the intention in substance and in detail which is embodied in it.
    9.30 p.m.
    I do not understand why Clause 2 is in the Bill. I hope that the Government, who brought this Bill forward, will give mature consideration to all the complications which it brings in, the difficulties
    582
    of enforcement which it brings into existence and the multiplication of injunctions to which it will give rise; and, be it borne in mind, the ever present likelihood of imprisonment for a breach of injunction, a most disagreeable consequence which we should seek to avoid wherever possible. If there are dozens or hundreds of injunctions throughout the country, somebody will break them fairly often. People will be put in prison for contempt of court. I should not like this procedure to be established on a wide scale, and I hope that second thoughts will come to the Government.
    Mr. Winterbottom: I deeply appreciated the speech of the hon. Member for Buckinghamshire, South (Mr. Ronald Bell). It was the speech of a lawyer with something added to it, namely, a knowledge of human nature which gave it a greater value than it would have had if it had merely contained lawyer-like explanations. It was one of the best speeches that I have heard today.
    I wish again to raise the question of cash, which was dealt with in the Amendment which was defeated. There was one point which I wanted to raise, but, because everybody seemed to be talking at length, I thought that I would leave it until we reached the Question, That the Clause stand part of the Bill. One of the problems in allowing credit from a supplier to a retailer or from a wholesaler to a retailer is, in many cases, the itinerant salesman, the man who is on one market day today and on another 50 miles away, tomorrow. Sometimes it is weeks before he gets back to the first market or district from which he has been supplied with goods.
    I have many years experience of the butchery trade and, in particular, the grocery trade. In the old days, when the country was rotting in idleness and a start was made by the cut pricers, especially in the industrial districts of the North, we found this problem most marked among the itinerant salesmen. Very often we found it difficult to discover from where they got their supplies.
    One thing has been forgotten in discussing resale price maintenance, and it is this. The Government might have done much more good to the country had they introduced a Bill to find out from where retailers' supplies came

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    rather than a Bill to deal with resale price maintenance. With itinerant salesmen on the market, many so-called suppliers are very hard to find.
    One problem arising from Clause 2 which perplexes me is how we are to draw the lines of demarcation between many of the practices which take place between the wholesaler and the retailer and sometimes between the wholesaler and the retailing staffs. For instance, how are we to deal with a cash discount which deals, not with individual items but with a number of commodities all ordered at once and which has been calculated on the cash value of the whole order?
    How are we to deal with the question, which was not raised by the hon. Member but is on the same line of thought, of the wholesaler who gives cash discount gifts to the staff of the retailers concerned without their going through the books of the organisation? These are only two out of dozens of points of common practice in the world of distribution and two which have a bearing on either the overheads or the original cost of the goods. These things are forgotten. No provision is made for them except in generalities which do not deal with the complications of the practical life in distribution.
    Let me give an illustration. How would one deal with the wholesaler of cigarettes who also retails them, who allows the usual about 9½ per cent. to the retailer and is dependent upon ½ per cent., or slightly less, with a 6½ per cent. cash discount? That man could meet the needs of the Bill and become the biggest price-cutter in the district. He could charge 5d. per packet less for 20 Player's cigarettes in competition with the retailer to whom he supplies goods at wholesale prices and take him out of business, because he is a wholesaler and a retailer. There is no provision for this in the Bill. There is no provision for the many complicated relationships which exist in the world of distribution.
    What about substitution? From my knowledge of the distributive trades and with no illusion about what happens in distribution, I prophesy that if there is one Measure which has been introduced into the House of Commons in the last 50 years that will encourage
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    the substitution of spurious second-class goods, it is this Bill. The substitution will not always be open and above board. It will be done from a knowledge of the trade which is not possessed by those who drafted the Bill.
    I have had packets of tea from cheap, cut-price shops and tasted it as against the so-called same brand of tea at the proper advertised price, and found that it was a substitution of low-grade, cheap tea. That is something which the Bill will encourage and foster throughout the distributive trades. Whether in groceries, or in the world of women's fashions, children's outfitting, or boots and shoes, the world of substitution will be encouraged by this Bill. There is no provision in this Clause to provide check or hindrance to activity of that kind.
    I suggest that the Bill should never have been introduced to apply only to the abolition of resale price maintenance unless, with its abolition, the Government began to deal with some of the difficulties in distribution, began to deal with the nature, substance and quality of consumer goods, began to deal with their standards and the recording of their standards. I can show them tins of fruit which differ in terms of the label on them. Sometimes they are called "super choice" but are of a standard make. This gives rise to all kinds of things, especially in the cut-price shops. It is the nature, substance and quality of goods which should be examined, to that consumers will know that that which is on the label is that which, in truth, they are purchasing. Till we deal with that we cannot deal with the problem of resale price maintenance.
    The Government can only deal with resale price maintenance if and when they plan distribution, and, in the planning, eliminate most of the evils which are there. And after they have planned it, the paradox is that we shall have to come back to some kind of understanding as to what the margin should be between the wholesale and the retail side, and sometimes between the manufacturer and the wholesaler.
    Can we hope that the Bill will be equitable throughout the length and breadth of the country when, in some places, there are shops each with only 30 customers and in other places there

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    are shops serving about 100 customers each? It is inevitable that there will be inequity, and till we have dealt with the problem of inequity in the world of distribution, trying to deal with the abolition of resale price maintenance is premature.
    Because of that I suggest that there are parts of the Bill which are so obnoxious to the world of distribution that it ought to be withdrawn; and the Government ought to do that as quickly as possible.
    Mr. Shepherd: It is true that there are problems in distribution, as the hon. Member for Sheffield, Brightside (Mr. Winterbottom) has just said. It may even be true that the processes of competition may be capable of ironing out some of those problems rather more easily than precise forms of legislation. I do not propose to discuss that issue at present, because I want to address myself closely to the Clause.
    I must say that I have found the speeches made by hon. Members opposite depressing. They showed the sort of attitude and mental approach which gave us the Monopolies and Restrictive Practices (Inquiry and Control) Act, 1948.
    Mr. H. Lever: The 1956 Act.
    Mr. Shepherd: The 1948 Act I said, an Act which had no teeth in it at all.
    Mr. Ellis Smith: We admit that.
    9.45 p.m.
    Mr. Shepherd: It ssems to me that, many years afterwards, hon. Members opposite are still looking at the antimonopoly legislation in the flabby way they viewed it then.
    Mr. Ellis Smith: We will soon have another chance.
    Mr. Shepherd: I am prepared to admit that it would have been possible to achieve a good deal of the purpose of the Bill had Section 25 of the 1956 Act been rescinded, taking from the supplier the legal sanctions to deal with those cutting prices. But we have not chosen to do so as the method of dealing with competition in retail trading. We have said, instead, that price maintenance in retail trade is an undesirable practice.
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    If we accept the premise that, subject to certain exceptions, the maintenance of retail prices by the manufacturer or supplier is in itself a harmful practice, an anti-social practice, then we must seek methods of enforcing this concept on those who do not pass the exception provisions The Bill will be useless if that is not to be the attitude of mind of this Committee.
    We say to certain individuals that they may appear before the Court, which, if it is satisfied that their practices are in the public interest, will, despite the general premise of the Bill, give an exemption. It would be foolish if we turned round and allowed other individuals who did not secure exemption to reach the same aim by restricting supplies to potential customers.
    Let us have no doubt about the ability of traders, suppliers and manufacturers to stop supplies going to retailers. I do not know whether hon. Members remember the extraordinary efforts made by cigarette manufacturers in the 1930s to prevent supplies going to price cutters. Secret agents and secret markings on packings were used; indeed, a whole apparatus was devised to prevent a man selling goods more cheaply than his neighbour.
    If we were not to provide something equal to the provisions of Clause 2, it would be pointless for anyone to go before the Court because he could obtain his objectives simply by the methods used in the 1930s. If anyone is naive enough to believe that the will of the House of Commons as expressed in these debates is sufficient to deter suppliers from working their own will upon the community, then he is more naive than one thought.
    The record of anti-monopoly legislation since 1948 is a record of legislation rendered negative by the machinations of those engaged in trade and industry. If we want an effective policing of the policy of resale price maintenance then this Clause is the one.
    Mrs. Harriet Slater: Is not the logic of what the hon. Member is saying that we are wasting our time with this Bill and that consumer protection means nothing at all, whatever shape or form in which we introduce it?
    Mr. Shepherd: I am sorry that I did not make myself clear. I am saying that, unless there was a proviso which compels supply, disagreeable as it may be, it would be useless to declare in the Bill that r.p.m. was against public interest. All those who wished to avoid the obligations of the Bill would stop supplies as they did in the 1930s to those who wanted to cut prices.
    Mr. Ronald Bell: Of course, in the 1930s it was done collectively; otherwise it could not have succeeded.
    Mr. Shepherd: But there is no necessity to do it collectively. It was easier to do it collectively and the punishment was greater for the man who wanted to show enterprise by selling at lower prices, but it could have been done quite as effectively individually. The collective process was much simpler and much more punishing to the individual who was enterprising.
    I want to refer to the continued repetition that the Clause compels people to supply goods to those whom they do not wish to supply on the ground that they are not creditworthy. I can see nothing in the Clause which would compel any supplier of goods to supply goods to an individual whom he thought to be not creditworthy. As a supplier of goods to wholesalers and retailers, I would have no hesitation, under the Bill as it now stands, in saying that I would withhold supplies from a man because I thought that he would not pay me. I can see nothing in the Clause which would prevent me from so doing. All I can see is that those individuals who want to broaden the loopholes in the Bill and who, under the pretext that a man might not pay, or some other pretext, would withhold goods, would be prevented from withholding goods; but there is nothing to prevent a manufacturer or supplier from withholding goods from a man he considers not to be creditworthy.
    I agree that the Clause is extremely difficult and raises issues which are disagreeable, but if we are serious in our attempt to make this a truly competitive country, we have to face doing things which, on our past understanding, we regard as disagreeable. Unless we are prepared to do those things which are
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    disagreeable, we will find that this country is left behind in the race for world trade. Hon. Members opposite, with their wishy-washy attitude towards these problems, will certainly not lead the country into a better world.
    Mr. Bence: I agree with the hon. Member for Cheadle (Mr. Shepherd) about monopolies. Certainly the Monopolies Act, 1948, and later legislation were inadequate for bringing to the consumer rather than the shareholder whatever benefits there might have been in private monopolies and for protecting the consumer from whatever evils there might have been in monopolies. There may not be as much ruthless competition as there was a hundred years ago, but those of us who are of this generation can thank God for that.
    Mr. Shepherd: If there is a low level of demand and large-scale unemployment, there may be some justification—although I doubt it—for restriction; but when the Government maintain a high and stable level of demand, is it not the duty of those in trade and industry to be truly competitive?
    Mr. Bence: I agree. There is probably some justification in certain branches of industry and commerce for asking for more competition, but those points at which more competition is needed are not the final points of distribution. There are many professional services where a little price competition would be very good, indeed. There are many intellectuals and professional people who ask the little shopkeeper to be competitive but who might be a little more competitive among themselves in their professional fees. I know that the hon. Member for Cheadle is a trader and I am not throwing this at him, but, as someone who has been in industry all his life, I resent the expectation that a manufacturer of goods should be intensely competitive, irrespective of the effect on his standard of living, while the people who lecture him subscribe to and are members of professions. I have a great respect and admiration for them and I appreciate their position on their resale price maintenance, but I wish that when they justify their resale price maintenance, they would find some justification for the resale price maintenance of my product.
    Mr. Ellis Smith: To make it quite plain to me, will my hon. Friend tell me who he means?
    Mr. Bence: I want to make that point, and I think that I am justified in making it because I refuse to accept that people do not compete with each other. They do compete with each other in factories. They do not compete quite so ruthlessly as we do in the Palace of Westminster, but there is, nevertheless, competition between them. There is a great deal of competition in this country, and I wish that people would stop crowing that there is not. There is plenty of competition between manufacturers of different products.
    I strongly object to the Clause. When I read it, I thought that I must have read it wrongly. I thought that it was impossible for a Government to insert a Clause like this in a Bill. That is how it struck me, having been in industry and business all my life.
    The big institution in any manufacturing concern is its sales force. A big concern has its sales department, and its salesmen travel the country looking for customers to buy the firm's products. It seems to me that by the provisions of this Clause an industrial unit whose salesmen are travelling the country looking for desirable customers—and, naturally, one does not want undesirable ones—will have to supply people who apply for its goods whether it wants to or not.
    Under the provisions of the Bill there will be set up a Restrictive Practices Court which will force the unit to which I have referred to accept a customer which its salesmen have said is undesirable. A manufacturing unit may be marketing its products all over the country. Its salesmen will visit Leicester, Nottingham, Stoke, Glasgow, Edinburgh—
    Mr. Ellis Smith: Not Stoke.
    Mr. Bence: All right, excluding Stoke.
    A salesman may call on a potential customer, and, after making inquiries, may decide that he is not a desirable customer. That person may then apply direct to the salesman's firm to be supplied with its products, and the firm will have no option but to supply him if he goes to the Restrictive Practices
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    Court ands obtains an order to compel the firm to do so.
    Sir D. Glover: I appreciate the hon. Gentleman's giving way. He is always extremely courteous in the House. A lot of us are worried about this, but I think that he has got the position wrong. If I have never supplied you, then I am not affected by this Bill. It is only when I have supplied you—[HON. MEMBERS: "Not so."] That is the position under the Bill. A manufacturer has a right to decide where and how he will distribute his products. If I thought that you were a very nice customer—and I am sure that I always would—I would supply you with goods. But if, following that, you started to cut my prices, I might decide that because you are doing that I will cut off your water, and not supply you any more. Then you would go and say—
    The Chairman: Order. I hope that the hon. Member will remember that he is addressing the Chair.
    Mr. Bence: On a point of order. With due respect, Sir William, the hour is getting late, and I was wondering whether you had forgotten that I had the Floor.
    It being, Ten o'clock, The CHAIRMAN left the Chair to Report progress and ask leave to sit again.
    Committee report Progress.

    RESALE PRICES BILL

      BUSINESS OF THE HOUSE
      Orderer,
      That the Proceedings on the Resale Prices Bill may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Redmayne.]

      RESALE PRICES BILL
      Again considered in Committee.
      The Chairman: The hon. Member for Dunbartonshire, East (Mr. Bence) was raising a point of order.
      Mr. Bence: Further to that point of order, Sir William, I raised it because I was in some considerable trepidation at the thought that you had forgotten that I was addressing the Committee. I hesitated to rise before, because the hon. Member for Ormskirk (Sir D. Glover) had threatened to cut off my water.
      Sir D. Glover: I apologise if any of the beautiful, pure streams of Scotland are thought to be in any way affected by anything that I have said in this Committee.
      The Chairman: Order. The hon. Member for Dunbartonshire, East has the Floor.
      Mr. Bence: I did not know whether the hon. Member was trying to destroy my argument. His intervention was of considerable length. I was saying that a manufacturer or supplier was compelled to supply a customer in his area, or, if he refused to do so, had to justify his action on other grounds than that the customer was breaking a resale price contract.
      A manufacturer can find all sorts of reasons why he should not supply a retailer or wholesaler. I do not wish to name companies or products, but I know of two famous firms whose products have been marketed for over a century and have never been supplied to any distributors or retailers. Through their own marketing organisations the firms market their products direct to the consumers, whether they be shopkeepers, housewives or large industrial engineering plants.
      The main reason why they have always been able to sell direct is that in every city and town in Great Britain they have established service stations where their machines can be serviced by expert mechanics trained by themselves. They regard the service behind the product as a very important factor in their business. They are selling the service with the machine. According to the Clause I understand that they will be compelled—
      Mr. H. Lever: No—they will not be affected.
      Mr. Bence: They will not be affected. In that case we have two manufacturing institutions which completely escape the Bill's provisions. They have this vertical structure, from the manufacturer straight to the customer. I take it that, under the provisions in Clause 2, a manufacturer could withhold supplies for any reason under the sun, with the exception of those applying to resale price maintenance.
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      I can think of dozens of products manufactured and distributed in this country which have to be kept under certain conditions in a shop or warehouse. They include engineering products and delicate instruments. Many consumer goods must be displayed under hygienic conditions. A manufacturer whose product is well known and advertised will require his distributors to have a knowledge of the product and be able to render an after-sales service. I can imagine that a company would be justified in arguing that a certain distributor was not adequately equipped to deal with its product.
      Motor companies do not appoint main agents unless those agents possess a certain amount of capital and equipment and employ trained staff. All sorts of conditions must be complied with before a main agent receives supplies from motor car manufacturers. If a motor car manufacturer witholds supplies from a motor agent on the grounds that the agent is insufficiently equipped, and if at the same time the agent has been cutting prices, the motor car manufacturer must prove that the reason he is withholding supplies is that the agent is not adequately equipped, and not that prices are being cut. This sort of thing will provide a paradise for the lawyers because the question of resale price maintenance will lead to a tremendous amount of litigation.
      This is no far-fetched argument. It actually happens. Manufacturers withhold all sorts of products because retailers are unable to store, equip or service such products. We have heard it argued on many occasions that a consumer should have the choice of buying a product on which there is a narrow margin of mark-up because there is no after-sales service. If the customer requires an after-sales service, he can secure it by obtaining the product from a store where the price is higher because of the existence of such a service. A manufacturer is entitled to say that he requires his distributors to provide an after-sales service. I am sure that people who, for example, buy typewriters expect to be able to get the machines serviced by experts. I presume that the lack of such a service would justify a manufacturer in refusing to

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      supply his product to a particular distributor. As I read Clause 2, a manufacturer would be entitled to do that. These are the sort of questions that I want answered.
      I dislike the Clause intensely, and I shall vote against it if I am given that opportunity, as I hope will also those hon. Members opposite who have always stood for this inalienable right of the individual and a company manufacturing or distributing a product to sell it to those to whom they desire to sell it and to refuse to sell it as they choose. People are already punished heavily by law if they supply a product to somebody who should not have it. A licensee is prosecuted for supplying drink to a man who has already had too much, but here are the men in Whitehall determining that manufacturers shall supply someone who, they think, ought to be supplied but who the manufacturers, knowing his lack of capacity to service and distribute the product, thinks should not be supplied. Here is where the expert in Whitehall knows best and the trader on the spot whose money is at stake knows nothing at all. This is the worst piece of legislation I have seen in 30 years in the House of Commons.
      Sir D. Glover: I should like—
      Mr. Mellish: Not to be too long.
      Sir D. Glover: Would the hon. Member care to rise and repeat what he said?
      Mr. Mellish: I was asking the hon. Member not to take too long.
      Sir D. Glover: If the hon. Member counts the number of columns in HANSARD which he and I have respectively occupied he will see that he has wasted more time.
      I understand many of the worries that the hon. Member for Dunbartonshire, East (Mr. Bence) has about Clause 2 so well that I asked the Secretary of State if he would provide a new Clause making it quite clear, separately from this Clause, that each manufacturer has a complete right to decide the agencies and methods of distribution of his product for the benefit of his own company and of the nation. But I was assured by my right hon. Friend that under Clause 2 every manufacturer has the right to continue the method of distribu-
      594
      tion which he has carried out in years gone by.
      Mr. H. Lever: Would the hon. Member tell us whether this assurance was given to him in his private ear or whether it was said across the Floor? None of us heard such an assurance.
      Sir D. Glover: If the hon. Member had listened to the debate yesterday he would have heard the Secretary of State give me an explicit assurance when I interjected on this very point of the fears expressed by the hon. Member and by the hon. Member for Dunbartonshire, East in their speeches. I still feel that it would be a good thing if there was a Clause in the Bill which made this quite clear. There is a great deal of anxiety among manufacturers, distributors and retailers as to whether their restricted franchise will be affected by the Bill.
      Mr. S. Silverman: I, too, am in favour of adding any Clause to the Bill which would make anything quite clear. The Bill has none so far. Would the hon. Member say exactly what he wants to make clear in the suggested Clause?
      The Chairman: Order. I should like to make clear that we should apply ourselves to the Question, That the Clause, as amended, stand part of the Bill.
      10.15 p.m.
      Sir D. Glover: I am just about in order in that it is under this Clause that the question arises of a manufacturer or distributor having freedom of action, with the exception of price cutting.
      The hon. Member for Nelson and Colne (Mr. S. Silverman) asked me what I am worried about. I will not go into a long explanation, but his esteemed colleague the hon. Member for Dunbartonshire, East, spent the last half-hour explaining what he was worried about in that manufacturers would no longer have the right to control the distribution of their products. We have had a long debate on the Amendment of my hon. Friend the Member for Crosby (Mr. Graham Page) about the credit-worthiness of customers. Any manufacturer must have the right to decide how to distribute his products.
      For a certain type of product it might be right to confine it to one distributor

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      in a town. For a smaller product there might be three outlets, and for an even smaller product there might be ten outlets. The manufacturer or distributor must have the right to decide on his own commercial policy about the goods which he is handling. Equally, he must have the right to decide his own financial policy, because if he goes bankrupt the State will not pay his debts; he will have to pay them himself.
      There is much unity in the Committee on these two points. The hon. Member for Manchester, Cheetham (Mr. H. Lever) agrees with every word which I have said on the financial side. But I want to come to a more fundamental aspect—and this is why I want a new Clause. I should like my hon. Friend to listen carefully. May I describe a case—not speaking for myself. I am a manufacturer and my policy at the moment is to supply my goods to everybody in the country who is willing to sell them. This is my position as a hypothetical manufacturer when the Bill becomes law.
      When the Bill becomes law my product comes under intense price competition and price cutting, so much so that the name which I have spent 25 to 50 years building up is, it appears to me and my board of directors, rapidly disappearing down the drain. We have a board meeting and decide that in future instead of supplying every dealer in the country, we shall supply our products to a restricted franchise—one supplier, or perhaps two, for each town. We decide as the policy of the firm that not everybody wanting to buy our goods will be able to buy them but that we shall maintain the reputation of our product by selling it on a restricted franchise. On our previous unrestricted practices we are supplying our goods to a great many outlets which are cutting the price to the bone, and we decide as a matter of permanent policy—not just for six months—to alter our method of distribution.
      Under the Bill I do not think that we should ever be allowed to do that. Surely if we are to write that restriction into a Statute we are removing an enormous amount of freedom from manufacturers and distributors to carry out their business in the best interests of their firm.
      Mr. Jay: It is plain that under the Bill the hon. Member would not be able to do that if his reason for withholding supplies from the other retailers were that they were cutting prices. There is no question about it.
      Sir D. Glover: I accept that, in the context that, basically, I am not in favour of price-fixing. On the other hand, there is a great distinction between accepting unrestricted competition and having some control over the outlets for one's goods. I should like my hon. Friend to give this serious thought. If he does not, the Bill will stratify the distributive process for all time when it becomes law, whereas in fact in a modern society distribution policy naturally changes year by year and what is good today is bad tomorrow. If under the Bill the Government are not able to knit into this the opportunity for a firm to alter its distributive processes, a stratified society will be created.
      Mr. A. P. Costain: Is my hon. Friend talking about an individual firm's products, or all the products of individual firms? How would he view the matter of a subsidiary company being set up to deal with one product?
      Mr. Bourne-Arton: I do not understand why my hon. Friend should assume that the Bill prevents his imaginary company from changing its sales policy and going over to a limited franchise. The Clause provides that a manufacturer must not refrain from supplying on the ground that a dealer has cut prices. This would not be the ground for the board of directors about which my hon. Friend has spoken reaching that decision. It is therefore outside the scope of the Bill.
      Sir D. Glover: This means that I shall have to take up the time of the Committee for a little longer. My hon. Friend has not seen the point. I am speaking of a company producing a popular piece of merchandise whose previous practice has been to sell it unrestrictedly across the board to anybody who wants to buy it. The company discovers that, as a result of this Measure, fewer and fewer people want to stock it because its price has been cut to the bone. There is then a board meeting. The directors decide to alter their policy.

      597
      However, under this Measure they will have to go on supplying, because, if they want to withhold supplies, they must find another reason than that of price-cutting. They cannot reach their decision purely on price-cutting. They must have another reason before they can change their policy. They may want to alter their policy because a product they have built up, perhaps over 50 years, and which is held in great esteem by the nation, is losing its reputation and becoming non-acceptable and because they see their turnover gradually falling because fewer and fewer people want to stock it.
      Mr. Bourne-Arton: Precisely. As a result of price cutting a new situation has arisen, and the company decides to change its policy. This is not discrimination directly against a price cutter. It is a change of commercial policy resulting from a new situation.
      Sir D. Glover: The trouble with the Bill, which is very complicated—[Laughter.] Hon. Members opposite may laugh. I find this the most fascinating Bill I have studied since I entered the House.
      Several Hon. Members rose—
      The Chairman: I would remind the Committee that we are not discussing the whole Bill but only the Question, That the Clause stand part of the Bill.
      Sir D. Glover: I apologise, Sir William, but to clear up this matter I have been anxious to give way. I am endeavouring to make this point on Clause 2 and to show that it is a valid example which my right hon. Friend should bear in mind.
      The point I am raising—and I have spent for many year in distribution, so I know what I am talking about—is a valid one. I am not in favour of r.p.m. and I believe in competition. At the same time, a person who is producing or distributing goods should be the master of his own household and I see a real danger that the Clause will cease to enable him to have that position.
      My hon. Friend the Member for Darlington (Mr. Bourne-Arton) has not grasped the point. If I have sold goods to A, B, C, D, or E without any restriction and the reason I want to stop
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      supplying them with my product is that they have been cutting prices, I shall find it difficult under the Bill to do so; yet it may be a decision of my board of directors that we should alter the policy of the company. Under the Bill we will find it almost impossible to do that.
      Mr. Bourne-Arton indicated dissent.
      Sir D. Glover: We will, because each one of those dealers will say that we are cutting off their supplies because they have been price cutting.
      In a Bil so complicated as this, I hope that the Secretary of State and the Attorney-General will appreciate that, speaking as a trader, I believe that what I am saying concerns a very real danger. I hope that they will have a serious look at this matter. I do not wish to delay the Committee and I hope that, on Report, my right hon. Friends will make certain that manufacturers and distributors will remain masters of their own households and will not become, as a result of the Bill, subservient to a system of which they entirely disapprove.
      The Attorney-General: Perhaps I can assist the Committee. My hon. Friend the Member for Ormskirk (Sir D. Glover) has suggested that because trading conditions have altered, as a result of the Bill, a company could not change its policy. I can assure him that that is quite wrong, because if the trading conditions had changed substantially the company would be perfectly entitled to restrict the agencies through which it sold. What it could not do would be to restrict the agencies through which it sold to those who were not price-cutting. The only restriction under Clause 2(1) is that the company must not restrict the agencies to those who have not either sold or are likely to sell at a cut price.
      Therefore, once a company has changed its policy, that change would be a justification for a restricted sales policy. The time at which one must look to see if that policy is being properly applied is the moment of the refusal to supply the goods and not the moment of the passing of the Bill. The Bill would not, therefore, stultify trading conditions and they would not have to remain exactly as they are at present.
      Sir D. Glover: How would this be decided? Would it be decided by the Court? How does one decide whether a company has altered its policy or has refused to supply goods because of price-cutting? It seems that unless we are careful we will need to have a court case before a firm can alter its policy.
      The Attorney-General: There is nothing whatever in the Bill which deals with the policy generally of a company provided it is applied equally and fairly between all the dealers and is not applied only to those who have or are likely to cut prices.
      Mr. Jay: Surely the right hon. and learned Gentleman will agree that on his own statement—and I shall be surprised if we are to have no further elucidation about this—it would only be necessary for the retailer to actually cut prices and to make plain the fact that he had done so to establish his right to get the supply of goods and throw the onus of proof to the contrary on to the manufacturer. Am I not right in that assumption?
      10.30 p.m.
      The Attorney-General: That is quite a different point. There are two quite different problems. One, which I was not discussing and which we shall discuss under Clause 4, relates to the onus of proof and the question of the relationship between a supplier and an individual dealer who wants goods. What I was trying to deal with was the point raised by my hon. Friend, quite fairly and properly, that a company will have to go on trading in the same way in which it has always done up to the time that the Bill was passed, and that it cannot thereafter change its trading policy.
      It can change its trading policy and it can say, "Trading conditions are such that instead of selling to everybody we will now sell only to one agent in the town." Provided that is the policy that it applies generally, and provided that it does not say, "We will only sell to the non-price cutters," it is entitled to pursue that policy.
      Mr. H. Lever: If a trader changes his policy—and this is the crux of the whole of this Clause—he will have to face the possibility of total ruin by an action for damages for breach of statutory duty, unless he can prove to the satisfaction of the court that he was not influenced in his decision to cut off supplies or to change his policy which resulted in the cutting off of supplies, in which case he will succeed, as the Attorney-General has said. The onus of proof will be statutorily upon him.
      Sir D. Glover: I find that interjection most helpful. What I am worried about is the case of the firm which has changed its policy because of price cutting and not for any other reason. If I had got a large plant with £1 million worth of machinery producing chocolate bars or something of that sort and, as a result of the play of competition, I found that most of the reputable people to whom I would like to sell ceased to stock my produce because it was no longer profitable, I should want to restrict my franchise to sell on a limited market. I should withdraw my supplies from those people because they were cutting prices.
      Mr. Lever: The Attorney-General's intervention has the quality of being technically correct but practically useless to people such as those—
      Mr. Ellis Smith: If I may interrupt my hon. Friend, can he explain how a thing can be technically correct if it is not practical?
      Mr. Lever: If a firm is placed in the position where it might have a reasonable chance of proving all the matters that the Attorney-General has spoken about, but there is a risk that it will not succeed, and the onus of proof is upon the firm, and failure so to prove would mean the total ruin of that firm, what normally happens is that the lawyer tells the firm, "You may have a reasonable, sporting chance of proving technically correctly your assertion, but should the reasonable, sporting chance come unstuck, you will be ruined."
      I am not going to make any point generally against the Bill. There is plenty of opportunity to do that later. I want to speak briefly on what I regard
      602
      as one of the most obnoxious Clauses in any Bill that has ever been brought before the House of Commons while I have been a Member. The only hon. Member who has made a vigorous defence of this machinery, as far as I know, is the hon. Member for Cheadle (Mr. Shepherd). He accuses those of us who cannot stomach this Clause of being flabby and lacking in muscularity in our approach to price maintenance. The respect for justice and the rights of individuals is not flabbiness; it is a concern for those in-built principles which we in this House are especially charged to preserve and protect.
      I submit, first, that one has only to read the Explanatory Memorandum about what it is sought to achieve in Clauses 1, 2 and 3 to realise that one cannot in a Bill of this kind accomplish so complex an achievement as to compel suppliers to supply and buyers to be free to buy on given terms without being unjust. The particular form of injustice to which I wish to draw attention is as follows. The remedies here are worse than if the Government had a simple straightforward enactment which made it a criminal offence to enforce price maintenance. The manufacturer would be in a better position if he were told that on pain of a fine and imprisonment he must not enforce price maintenance than he is in the precarious situation in which he is placed here. The manufacturer will inevitably and often be put in a position where it will be doubtful whether he will succeed in the civil action which can be brought against him—an action for unlimited damages. The more dishonest the man bringing the action, the more precarious will be the supplier's position.
      I will not deal with the general possibilities of destroying price maintenance, but the method chosen is obnoxious to anyone who has any respect for the subtle and flexible arrangements of all kinds mentioned by hon. Members who are concerned in trade. It must not have occurred to the Secretary of State and his muscular trade supporters, like the hon. Member for Cheadle, that some manufacturers and suppliers do not like to deal with crooks.—[HON. MEMBERS: "A novel doctrine"]—It may be an

      603
      eccentricity on the part of some suppliers and manufacturers, but they exist certainly in the part of the country from which I come and no doubt they are equally to be found in other parts.
      Under the Clause in certain circumstances a supplier is made to deal, whether he likes it or not, on pain of an action which would ruin him or an injunction which would stigmatise him and cast him into gaol if he persisted, with a man he knows to be a crook. The man may have come out of prison just long enough ago to qualify him for the most favourable terms of undercutting the man's product for a week, within the six-months' period referred to in the Measure. I see the Minister shaking his head. Does he really say that a man with a criminal record is not entitled to use the provisions in Clause 2 to enforce supplies? Of course he is. And the supplier is obliged to deliver to him the actual—
      Mr. Bourne-Arton: No. This is the point. A supplier is not obliged to supply anybody who has a criminal record if he thinks that is a good reason for withholding the supply.
      Mr. Lever: But the onus of proof would be thrown on him by this muscular Clause. He would have to prove that it was not because the man had been cutting his prices that he had not supplied but because he had a criminal record. It is terrifying for a manufacturer that if he wants his just rights under the Bill, assuming that the spirit of the Bill is passed in some form, he can never exercise those just rights without being told by his lawyers that the onus of proof is on him. He stands in grave peril always of being ruined by the kind of action for damages which is created by the Bill.
      Also, the idea that because one has cut prices and insisted on supplies, this should entitle one to most-favoured nation treatment is so odd and astonishing that it does not seem to me possible that it could be approved by the Committee. One would have thought that as the country gets more and more prosperous we should be less and less inclined to encourage the rat race, but it is obvious that there will always be rats even when the rat race is no longer
      604
      necessary. I wonder why it is thought necessary in the Clause to exalt the price cutter and force ordinary manufacturers not merely to supply him but to give him credit on peril of being sued for damages or faced with an injunction by the Attorney-General.
      It speaks volumes for the impartiality and generosity of my hon. and learned Friend the Member for Northampton (Mr. Paget) that he supposes that, if the Committee enacts this power and enables the Attorney-General to proceed by way of injunction against a supplier, nobody will dream of using it. I do not understand why the Government want such a power in the hands of the Attorney-General if he is not to use it. Perhaps the Attorney-General will explain the reason for wanting a power which he will be unable to use.
      The truth is that the power is to be given to him to intimidate suppliers. When a supplier has such an injunction against him, imagine his pitiable condition. The injunction will say to him, "You shall not further withhold supplies from this man". A reference to the wording of this infamous Clause shows that it is proposed to enact that it is a withholding of supplies if the supplier in any respect fails to give the man in question the most favoured treatment of all his customers. Therefore, once an injunction is made against a firm, it will have to proceed with meticulous care to ensure that the man with whom it is at loggerheads has the best credit and other terms of dealing that any other customer has, on pain of being cast into prison, since breach of the injunction would be a contempt.
      The Committee cannot possibly allow the Government to enact a Clause so unjust, so peremptory and so unnecessary even for the purpose of destroying the resale price maintenance system, as was shown by the hon. Member for Buckinghamshire, South (Mr. Ronald Bell).
      Hon. Members opposite are not obliged to vote with us and cause acute embarrassment and nervous tension to the Government in order to produce the result which we all desire. Hon. Members opposite have shown that they are very concerned about this matter, and I am the last person to be in a position to lecture them on how they should

      605
      fulfil their duty. But, with respect, I feel that hon. Members on both sides of the Committee who feel passionately on this Clause, quite apart from the general principles of price maintenance, ought to enforce our will on the Government by some means, be it by vote or by pressure of one Parliamentary kind or another available to us.
      Mr. du Cann: I shall endeavour to answer the points which have been raised in the debate and at the same time make some general observations on this Clause.
      I noted two points particularly in the speech of the right hon. Member for Battersea, North (Mr. Jay). The right hon. Gentleman said—I think I quote his words almost exactly—that he had no objection to the abrogation of the power of the supplier to force a retailer to charge higher prices than he wished. I entirely agree. That is the chief purpose of the Bill. Plainly, we agree between us that the present position is unsatisfactory, and the aim in all our discussions is to find an appropriate method to remedy the situation. The Government believe that this Bill is the appropriate method.
      I very much agreed with the right hon. Gentleman also when he said that it was quite wrong that we should permit a situation to endure in which it was possible to forbid price competition by law. That is entirely right. I remember my right hon. Friend bringing the same point out in his Second Reading speech.
      If we agree, as between the Government and the official Opposition, as to what we are seeking to achieve in general, the only quarrel between us is as to method. The method chosen in the Clause is well known to the Committee now, and I shall not take time by going into it, save to repeat that it seems to us to be the right method and a wise method. I shall endeavour now to illustrate the reasons for my confidence.
      I take, first, a point raised by the right hon. Gentleman, by the hon. and learned Member for Northampton (Mr. Paget) and by my hon. Friend the Member for Buckinghamshire, South (Mr. Ronald Bell). My hon. Friend's speech I greatly enjoyed, as, I think, did every-
      606
      one who heard it. Indeed, one hon. Gentleman opposite who followed him said that it was one of the best speeches he had heard on this subject or ever in the House of Commons. I think that it was—but, my word, I thoroughly disagreed with a great deal of what my hon. Friend had to say, and I thought that he was answered effectively by my hon. Friend the Member for Cheadle (Mr. Shepherd).
      10.45 p.m.
      It is suggested that the Clause means, in effect, that manufacturers must supply. In fact, it says that manufacturers must not withhold supplies, in certain conditions, which is a very different thing. The only purpose of the limited curtailment in the Bill of the supplier's right to sell his goods to whom he chooses, upon which my hon. Friend rightly sets great store, is to preserve the dealer's right to sell his goods at the prices he chooses. I suggest that that is a right of which the dealer has been deprived for far too long. It is that right which we seek to restore and I suggest that it is equally, if not more, important.
      I am sorry that I did not hear the whole of the speech of the hon. Member for Dunbartonshire, East (Mr. Bence), who raised the question of a supplier to a motor agent or dealer. Under the Clause as written, a supplier to a motor agent can withhold supplies, assuming that the motor agent is not price-cutting, on the ground that the dealer is unqualified in some way. I do not think that there would be much difficulty in proving it. The hon. Member mentioned that category and also typewriters. In the circumstances which he described, precisely the same would obtain.
      The hon. Member went on to ask whether the Bill was virtually a lawyer's benefit. That is not the view that we take of it, particularly in the circumstances retailed by the hon. Member. We think that proof in these cases would be a simple matter. That, again, is the answer to another point raised by the right hon. Member for Battersea, North.
      I understand the kindness of my hon. Friend the Member for Bath (Sir J. Pitman) in not taking the time of the Committee to move Amendments. It is slightly ironic that he did not do so, because I was ready to accept the first

      607
      completely and the second in principle. Now that my hon. Friend has made his points, I do not, on this Motion, know what to reply to him, except to say that if he will be good enough to put down Amendment 23 again on Report, and assuming that there are no mistakes in transmission, we shall certainly consider accepting it. As to Amendment 21, we will put down an Amendment to cover the point.
      My hon. Friend the Member for Buckinghamshire, South asked why we should not repeal Section 25 of the 1956 Act to abolish resale price maintenance and said that it could be done as simply as that. That, too, was answered by my hon. Friend the Member for Cheadle. The chief reason why Section 25 remains is for exempted goods. In other cases, it disappears in effect, although the Bill does not specifically refer to Section 25. We think that it would be inconsistent explicitly with the general approach embodied in the Bill to withdraw the support of Section 25 from exempted goods. The point basically is this. Surely, it is agreed by my hon. Friend that there should be exemption procedures. Surely, exempted goods deserve protection, which would mean that Section 25 must remain.
      It was the hon. Member for Sheffield, Brightside (Mr. Winterbottom) who paid tribute to my hon. Friend the Member for Buckinghamshire, South. The hon. Member, speaking from his experience, interested us all. I cannot catch sight of the hon. Member; if he is not here, I will curtail my remarks to him. I felt, as, I am sure, many hon. Members felt, that his fears were misconceived. The Bill will not mean the end of retail distribution. It will not mean an end of quality, and recommended prices can still appear.
      To come to another point made by my hon. Friend the Member for Buckinghamshire, South, who certainly deployed the most powerful of all the cases made against this Clause, he said that the Clause in his opinion was unnecessary. I hope that I can convince him otherwise. Without the Clause the prohibition in Clause 1 can be evaded without any difficulty if the supplier can withhold supplies of price-cut goods, which only means the goods being sold slightly cheaper. The imposition of minimum
      608
      prices is not even necessary. R.p.m. could be made effective simply by withholding goods. Therefore, I am sure that my hon. Friend will agree that, in logic, the whole purpose of the Bill would be undermined if there were no Clause 2. Many suppliers at present enforce r.p.m. not by legal action but simply by withholding supplies. Without what I shall describe again as this limited prohibition on the withholding of supplies we should not get rid of r.p.m. by this Bill.
      Finally, I should say that the Government have no wish to interfere with what I may describe as ordinary trading practices, about which there has been so much discussion this afternoon and this evening. To refer again to a point made by the hon. Member for Dunbartonshire, East and the type of case he was speaking about especially, if a firm is not acceptable to a supplier for reasons other than that the firm wishes to reduce prices—for example, creditworthiness, or the fact that the manager of the firm, or the firm itself if it is a one-man band, which was mentioned, has a criminal record, he certainly must be free to use commercial judgment.
      My right hon. Friend said, and said clearly, in reply to an earlier debate, that certainly we shall be very ready to take into account, both in the light of the decisions on the Amendments to the Clause and the discussions we are going to have in relation to Clause 4, the points which my hon. Friends and by hon. and right hon. Gentlemen opposite have in mind. We do not regard the Clause as perfect. We have never said we did. We do regard it, however, as an essential part of the Bill. I say to the Committee that, in our judgment, it is an integral part of the Bill, and I commend it to the Committee.
      Sir D. Glover: My hon. Friend is usually very courteous, and I should very much like a reply to the point I made in my speech. Even though I say it with great humility, I know more about retailing than 95 per cent. of the people in the Committee. I have spent the whole of my working life in it. The point I made and the case I put about manufacturers changing their policy was a very valid point, and if my hon. Friend did not reply to it I shall go into the Lobby against him.
      Mr. du Cann: I certainly would not wish my hon. Friend to think me guilty of discourtesy. The reason I did not reply to the points he raised particularly was very simple: I thought that my right hon. and learned Friend the Attorney-General had done so. He made two interventions at some length. If my hon. Friend the Member for Ormskirk (Sir D. Glover) feels that he still does not have the information which he wishes to
      have I shall certainly see he has it, and furthermore, I will certainly see that the points which he brought to our attention—he said during his remarks he was happy we should do this—are considered by my right hon. Friend.
      Question put, That the Clause, as amended, stand part of the Bill:—
      The Committee divided: Ayes 218, Noes 130.

      Division No. 55.]

      AYES

      [10.54 p.m.

      Agnew, Sir Peter

      Gough, Frederick

      Mawby, Ray

      Amery, Rt. Hon. Julian

      Grant-Ferris, R.

      Maxwell-Hyslop, R. J.

      Atkins, Humphrey

      Green, Alan

      Maydon, Lt.-Cmdr. S. L. C.

      Awdry, Daniel (Chippenham)

      Gresham Cooke, R.

      Mills, Stratton

      Barber, Rt. Hon. Anthony

      Grimond, Rt. Hon. J.

      Miscampbell, Norman

      Barlow, Sir John

      Gurden, Harold

      Montgomery, Fergus

      Batsford, Brian

      Hall, John (Wycombe)

      More, Jasper (Ludlow)

      Bovine, Rt. Hon. Reginald

      Hamilton, Michael (Wellingborough)

      Morgan, William

      Biffen, John

      Harrison, Brian (Maldon)

      Mott-Rodclyffe, Sir Charles

      Biggs-Davison, John

      Harrison, Col. Sir Harwood (Eye)

      Noble, Rt. Hon. Michael

      Birch, Rt. Hon. Nigel

      Harvey, John (Walthamslow, E.)

      Nugent, Rt. Hon. Sir Richard

      Bishop, Sir Patrick

      Hastings, Stephen

      Orr-Ewing, Sir Ian (Hendon, North)

      Bourne-Arton, A.

      Hay, John

      Osborn, John (Hallam)

      Bowen, Roderic (Cardigan)

      Heald, Rt. Hon. Sir Llonel

      Page, John (Harrow, West)

      Box, Donald

      Heath, Rt. Hon. Edward

      Pannell, Norman (Kirkdale)

      Boyd-Carpenter, Rt. Hon. John

      Hiley, Joseph

      Partridge, E.

      Boyle, Rt. Hon. Sir Edward

      Hill, Mrs. Eveline (Wythenshawe)

      Pearson, Frank (Clitheroe)

      Braine, Bernard

      Hobson, Rt. Hon. Sir John

      Peel, John

      Brewis, John

      Hogg, Rt. Hon. Quintin

      Percival, Ian

      Brooke, Rt. Hon. Henry

      Holland, Philip

      Peyton, John

      Brown, Alan (Tottenham)

      Holt, Arthur

      Pickthorn, Sir Kenneth

      Bryan, Paul

      Hopkins, Alan

      Pike, Miss Mervyn

      Buck, Antony

      Hornby, R. P.

      Pitman, Sir James

      Bullard, Denys

      Hornsby-Smith, Rt. Hon. Dame P.

      Pitt, Dame Edith

      Campbell, Gordon

      Howard, Hon. G. R. (St. Ives)

      Pounder, Rafton

      Carr, Rt. Hon. Robert (Mitcham)

      Hughes Hallett, Vice-Admiral John

      Powell, Rt. Hon. J. Enoch

      Channon, H. P. G.

      Hughes-Young, Michael

      Price, David (Eastleigh)

      Chataway, Christopher

      Hulbert, Sir Norman

      Price, H. A. (Lewisham, W.)

      Clark, Henry (Antrim, N.)

      Hutchison, Michael Clark

      Prior, J. M. L.

      Cole, Norman

      Iremonger, T. L.

      Prior-Palmer, Brig. Sir Otho

      Cooke, Robert

      Irvine, Bryant Godman (Rye)

      Proudfoot, Wilfred

      Cooper-Key, Sir Neill

      Johnson, Eric (Blackley)

      Quennell, Miss J. M.

      Cordeaux, Lt.-Col. J. K.

      Johnson Smith, Geoffrey

      Ramsden, Rt. Hon. James

      Corfield, F. V.

      Jones, Arthur (Northants, S.)

      Rawlinson, Rt. Hon. Sir Peter

      Costain, A. P.

      Joseph, Rt. Hon. Sir Keith

      Redmayne, Rt. Hon. Martin

      Courtney, Cdr. Anthony

      Kaberry, Sir Donald

      Rees, Hugh (Swansea, W.)

      Dalkeith, Earl of

      Kerans, Cdr. J. S.

      Rees-Davies, W. R. (Isle of Thanet)

      Dance, James

      Kershaw, Anthony

      Renton, Rt. Hon. David

      d'Avigdor-Goldsmid, Sir Henry

      Kirk, Peter

      Ridsdale, Julian

      Deedeo, Rt. Hon. W. F.

      Kitson, Timothy

      Rippon, Rt. Hon. Geoffrey

      Digby, Simon Wingfield

      Langford-Holt, Sir John

      Roberts, Sir Peter (Heeley)

      Douglas-Home, Rt. Hon. Sir Alec

      Leather, Sir Edwin

      Rodgers, John (Sevenoaks)

      Drayson, G. B.

      Legge-Bourke, Sir Harry

      Roots, William

      du Cann. Edward

      Linstead, Sir Hugh

      Royle, Anthony (Richmond, Surrey)

      Eden, Sir John

      Litchfield, Capt. John

      Russell, Sir Ronald

      Elliot Capt. Walter (Carshalton)

      Lloyd, Rt. Hn. Geoffrey (Sut'n C'd field)

      Sandys, Rt. Hon. Duncan

      Emery, Peter

      Longbottom, Charles

      Scott-Hopkins, James

      Emmer, Hon. Mrs. Evelyn

      Loveys, Walter H.

      Sharples, Richard

      Errington, Sir Eric

      Lubbock, Eric

      Shaw, M.

      Erroll, Rt. Hon. F. J.

      Lucas, Sir Jocelyn

      Shepherd, William

      Farr, John

      Lucas-Tooth, Sir Hugh

      Skeet, T. H. H.

      Fell, Anthony

      MacArthur, Ian

      Smith, Dudley (Br'ntf'd & Chiswick)

      Finlay Gracme

      McLaren, Martin

      Smyth, Rt. Hon. Brig. Sir John

      Fisher, Nigel

      Maclean, Sir Fitzroy (Bute & N. Ayrs)

      Soames, Rt. Hon. Christopher

      Fraser, Rt. Hn. Hugh (Stafford & Stone)

      Macleod, Rt. Hn. Iain (Enfield, W.)

      Spearman, Sir Alexander

      Fraser, Ian (Plymouth, Sutton)

      McMaster, Stanley R.

      Speir, Rupert

      Freeth, Denzil

      Macmillan, Maurice (Halifax)

      Stoddart-Scott, Col. Sir Malcolm

      Gammans, Lady

      Maitland, Sir John

      Studholme, Sir Henry

      Gardner, Edward

      Marples, Rt. Hon. Ernest

      Summers, Sir Spencer

      Gilmour, Ian (Norfolk Central)

      Marten, Neil

      Taylor, Frank (M'ch'st'r, Moss Side)

      Gilmour, Sir John (East Fife)

      Mathew, Robert (Honiton)

      Teeling, Sir William

      Glover, Sir Douglas

      Matthews, Gordon (Meriden)

      Temple, John M.

      Glyn, Dr. Alan (Clapham)

      Maude, Angus (Stratford-on-Avon)

      Thatcher, Mrs. Margaret

      Godber, Rt. Hon. J. B.

      Maudling, Rt. Hon. Reginald

      Thompson, Sir Richard (Croydon, S.)

      Goodhart, Philip

      Thornton-Kemsley, Sir Colin

      Wade, Donald

      Williams, Paul (Sunderland, S.)

      Thorpe, Jeremy

      Walder, David

      Wilson, Geoffrey (Truro)

      Tilney, John (Wavertree)

      Walker, Peter

      Wolrige-Gordon, Patrick

      Touche, Rt. Hon. Sir Gordon

      Wall, Patrick

      Wood, Rt. Hon. Richard

      Turner, Colin

      Ward, Dame Irene

      Woodhouse, C. M.

      Turton, Rt. Hon. R. H.

      Watkinson, Rt. Hon. Harold

      Worsley, Marcus

      van Straubenezee, W. R.

      Webster, David

      Vaughan-Morgan, Rt. Hon. Sir John

      Whitelaw, William

      TELLERS FOR THE AYES:

      Vosper, Rt. Hon. Dennis

      Williams, Dudley (Exeter)

      Mr. Chichester-Clark and

      MR. R. W. Elliott.

      NOES

      Ainsley, William

      Hayman, F. H.

      Padley, W. E.

      Awbery, Stan (Bristol, Central)

      Henderson, Rt. Hn. Arthur (Rwly Regis)

      Paget, R. T.

      Barnett, Guy

      Herbison, Miss Margaret

      Pannell, Charles (Leeds, W.)

      Beaney, Alan

      Hilton, A. V.

      Pavitt, Laurence

      Bennett, J. (Glasgow, Bridgeton)

      Holman, Percy

      Peart, Frederick

      Blackburn, F.

      Houghton, Douglas

      Pentland, Norman

      Blyton, William

      Howell, Charles A. (Perry Barr)

      Prentice, R. E.

      Bottomley, Rt. Hon. A. G.

      Howie, W.

      Price, J. T. (Westhoughton)

      Bowden, Rt. Hn. H. W. (Leics, S.W.)

      Hughes, Emrys (S. Ayrshire)

      Probert, Arthur

      Bowles, Frank

      Hughes, Hector (Aberdeen, N.)

      Redhead, E. C.

      Braddock, Mrs. E. M.

      Hynd, John (Attercliffe)

      Rees, Merlyn (Leeds, S.)

      Bray, Dr. Jeremy

      Irvine, A. J. (Edge Hill)

      Roberts, Albert (Normanton)

      Brockway, A. Fenner

      Irving, Sydney (Dartford)

      Robinson, Kenneth (St. Pancras, N.)

      Brown, Rt. Hon. George (Belper)

      Jay, Rt. Hon. Douglas

      Rodgers, W. T. (Stockton)

      Butler, Herbert (Hackney, C.)

      Jenkins, Roy (Stechford)

      Rogers, G. H. R. (Kensington, N.)

      Castle, Mrs. Barbara

      Johnson, Carol (Lewisham, S.)

      Ross, William

      Cliffe, Michael

      Jones, Dan (Burnley)

      Silverman, Sydney (Nelson)

      Collick, Percy

      Jones, Elwyn (West Ham, S.)

      Skeffington, Arthur

      Craddock, George (Bradford, S.)

      Kelley, Richard

      Slater, Mrs. Harriet (Stoke, N.)

      Cronin, John

      Kenyon, Clifford

      Slater, Joseph (Sedgefield)

      Crosland, Anthony

      Lawson, George

      Small, William

      Crossman, R. H. S.

      Lee, Frederick (Newton)

      Smith, Ellis (Stoke, S.)

      Darling, George

      Lever, Harold (Cheetham)

      Sorensen, R. W.

      Davies, Harold (Leek)

      Lewis, Arthur (West Ham, N.)

      Soskice, Rt. Hon. Sir Frank

      Davies, S. O. (Merthyr)

      Laughlin, Charles

      Stones, William

      Dempsey, James

      Mabon, Dr. J. Dickson

      Swain, Thomas

      Diamond, John

      McBride, N.

      Symonds, J. B.

      Dodds, Norman

      McCann, John

      Taverne, D.

      Doig, Peter

      MacColl, James

      Thompson, Dr. Alan (Dunfermline)

      Driberg, Tom

      MacDermot Niall

      Tomney, Frank

      Duffy, A. E. P. (Colne Valley)

      Manuel, Archie

      Wainwright, Edwin

      Edwards, Walter (Stepney)

      Mapp, Charles

      Warbey, William

      Evans, Albert

      Mellish, R. J.

      Wells, William (Walsall, N.)

      Fitch, Alan

      Mendelson, J. J.

      White, Mrs. Eirene

      Fletcher, Eric

      Millan, Bruce

      Whitlock, William

      Foot, Dingle (Ipswich)

      Milne, Edward

      Wigg, George

      Foot, Michael (Ebbw Vale)

      Morris, Charles (Openshaw)

      Wilkins, W. A.

      Fraser, Thomas (Hamilton)

      Neal, Harold

      Williams, W. T. (Warrington)

      Ginsburg, David

      Noel-Baker, Francis (Swindon)

      Winterbottom, R. E.

      Gordon Walker, Rt. Hon. P. C.

      Oliver, G. H.

      Woof, Robert

      Grey, Charles

      O'Malley, B. K.

      Wyatt, Woodrow

      Hale, Leslie (Oldham, W.)

      Oram, A. E.

      Hamilton, William (West Fife)

      Oswald, Thomas

      TELLERS FOR THE NOES:

      Harper, Joseph

      Owen, Will

      Dr. Broughton and Mr. Ifor Davies.

      Hart, Mrs. Judith

      Mr. Heath: I beg to move,
      That the Chairman do report Progress and ask leave to sit again.
      We might perhaps discuss how we should handle the next stages of the Bill. We have now had a number of long discussions on a number of Amendments put forward by my hon. Friends, and a long debate on the Question, That the Clause, as amended, stand part of the Bill. Many hon. Members will be disappointed that we have reached this late hour without achieving discussions on the "loss leader" in Clause 3, and, indeed, more detailed discussions on Clause 4, which has been of great concern to hon. Members on both sides of the Committee in the course of the day.
      612
      In the ordinary way, on an occasion like this evening's, one would expect that we would be able to go on and make further progress with Clause 3 and loss leaders. That, however, is a big subject, on which we have put forward fundamental proposals. There have been discussions in the Press and elsewhere about the nature of the Clause, and we have put down Amendments which represent a fresh approach to the subject, in an attempt to avoid some of the difficulties which are inherent in the approaches suggested so far.
      I feel that in the circumstances, as we are on the eve of an Adjournment before a Recess and questions of travel are of importance to hon. Members on both

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      sides of the Committee, and as the next debate is bound to be one not only of importance but of considerable length, embodying a whole group of Amendments which can be taken together, we should not endeavour to embark upon it at this hour.
      I hope it will be for the convenience of the right hon. Gentleman and his hon. Friends, and for my right hon. and hon. Friends, if we now report Progress, and I also express the hope that when we resume, as announced by the Leader of the House this afternoon, and embark on the remaining Clauses, we shall be able to make rather more rapid progress than we have been able to make so far. I hope, therefore, that it will be convenient to the Committee if we now bring our deliberations to a conclusion.
      Mr. G. Brown: This just shows that one's faith, as an Anglican, ought never really to be disregarded. One can always save a sinner if one tries hard enough. Last night I was a little cast down, because I thought that the right hon. Gentleman was beyond redemption. Clearly that was not so. He can be saved, and tonight he is proving himself—[An HON. MEMBER: "Parson Brown."]—[Laughter.] If what is reported to me as having been said is in fact what was said, it does not seem to justify that amount of hilarity. Anyway, it seems that we can now take a certain amount of humble pride in having impressed on the right hon. Gentleman last night that he should not be quite so rough and tough. He has learned his lesson and has come to us tonight in a much more humble mood.—[Interruption.]—Yes, indeed. He has now proposed that, having gone just about as far as he knows he can get, we should all go home.
      I want to make it quite clear that my hon. Friends and I have not held up the Bill so far. His own hon. Friends have occupied a large part of the time, and I must remind him that it was I who came here today to get his Bill afloat, at a time when his right hon. and learned Friend the Leader of the House did not bother to come in, and when he himself was a wee bit afraid to rise. We got his Bill afloat for him. But for that we would have been discussing
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      points of order for a long time. We helped him as far as we could.
      However. I agree with him, in his new mood—the mood of today as against the mood of yesterday—that once we start on the next set of Amendments and the next Clause we shall be dealing with a very wide subject, which will take us a long time. It would be jolly inconvenient for hon. Members on both sides of the Committee to interrupt that debate. It therefore seems a natural thing to break off our discussion at this point.
      As to any commitment when we come back after Easter, I want to make it quite clear that on this side of the Committee we shall conduct the debate exactly as we have done up to now. We shall discuss every point in the Bill with the attention that it demands, and we shall give it no more but no less than the attention that one would expect from a flee House of Commons. I do not want the right hon. Gentleman's Motion to be accepted with any misunderstanding about our position, but on that basis I think that the right hon. Gentleman is doing much better tonight than he did last night. I am therefore delighted tonight to second him and on behalf of my hon. and right hon. Friends to agree that we should now report Progress.
      Mr. Heath: I understand the right hon. Gentleman, of course, when he says that he has entered into no commitment about the future conduct of the Bill from his side of the Committee, but I fully apreciate what he was saying when he said that he was determined to carry on conducting the proceedings on the Bill in the way that hon. and right hon. Members opposite have been doing so far, because that enables us to form our own judgment about the way the proceedings have been going.
      I am grateful to the right hon. Gentlemen for his help this afternoon when he indicated to his hon. Friends that he would prefer them not to raise points of order. In this respect he was quite different from last night when he moved a Motion similar to the one we are now discussing and suggested to his hon. Friends that they should take further part in the debate. I agree with

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      the right hon. Gentleman that we have reached a satisfactory solution and should report Progress.
      Mr. Brown: I said last night that the right hon. Gentleman had joined the select band of Ministers who had obstructed their own Bill, and he is doing the same thing again. If the right hon. Gentleman wants to play it this way, very well. We will play it this way [HON. MEMBERS: "Touchy."] No, not touchy, but I want some things to be quite clear on the record. The right hon. Gentleman was laying, a speech then to which he hoped to refer at a later date when the Guillotine Motion is moved by the Patronage Secretary. I want to get one point quite clear. There has been absolutely no behaviour from this side of the Committee which could possibly justify that. There have been speeches after speeches from both sides of the Committee, and there has been as much concern on the benches opposite about the effect of the Bill as there has been on this side.
      If the right hon. Gentleman wants to play it this way, we are quite prepared to stay here tonight. If he does, let us start on the next Clause. This is the absurdity of the position that the right hon. Gentleman takes up. Faced with a genuine offer from this side of the Committee, he cannot help but make a kind of party point. We have helped him far more than have his own hon. Friends. If the right hon. Gentleman is thinking, as I guess he is, and as I guess he has already arranged with the Patronage Secretary, in terms of a Guillotine Motion on Monday, 13th April, let us make it quite plain that nothing has been done on this side of the Committee to justify it. If he wants to defer the debate until the next sitting day, it is all right as far as we are concerned, but it is for the right hon. Gentleman's convenience. The Leader of the House, who so seldom troubles us with his attendance, should not enter into hiccups the moment he arrives [Laughter.] The mere mention of his right hon Friend's name caused him to hiccup. Last night all he did was to appear round the corner to see whether his right hon. Friend was in trouble; and the moment he saw that he was in trouble out he dodged. If the right hon.
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      and learned Gentleman feels, as I do, that his right hon. Friend did not deal very well with this matter, perhaps he would like to say a word about it.
      11.15 p.m.
      To us it seems logical and rational to end the discussion here, but I want no threats held over our head and no misunderstandings. We, being broadly speaking in favour of the consumer, have helped a rather bad Bill to be amended and improved. We shall address ourselves to the rest of the Bill in the same spirit. The right hon. Gentleman will perhaps use the Recess to talk to some of his hon. Friends, who clearly do not see the consumer in the same way as we see him.
      Mr. Heath: The right hon. Gentleman and I are both agreed that this is a suitable moment at which we should interrupt proceedings on the Bill and report Progress.
      Question put and agreed to.
      Committee Report Progress; to sit again Tomorrow.

      ROADS (M.4 ROUTE)
      Motion made, and Question proposed, That this House do now adjourn.—[Mr. Finlay.]
      11.17 p.m.
      Mr. Peter Emery: Just about 24 hours ago I was on my feet from my place in the House. The House seems a little less full now than it was then, and I hope that what I say will be considerably less contentious.
      I want to draw the attention of the House to the position of the routing of the motorway M.4 as it affects my constituency of Reading. I should like to make it plain from the outset that I do not wish to enter into any controversy or any discussion about the way in which it may affect a large number of other constituencies through the whole of Berkshire, Devizes and, indeed, a number of others, but I shall keep my remarks entirely to the position of Reading.
      The first point which anybody ought to realise in discussing this matter is the extreme difficulty which the Ministry of Transport has in coming to its decision

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      about the route which this shall take. The historical background has been considerable, and it is in some way because of this that it seems to me important that the position and the case for Reading should be made quite clear. The Reading and district traffic survey, which has been carried out by the local authority is in my hon. Friend's hands, and I am certain that he agrees with me that this is one of the first of the newer traffic surveys.
      Going into the greatest possible detail, I am certain that it is possible to provide him with the sort of information required to reach the proper judgments and decisions affecting roads and their environment in any new plan which has to be brought forward. But he knows that in respect of the M.4 this proposal goes back for many years, and indeed until quite recently it was always believed that this road would go south of Reading.
      Development and planning provisions were conditioned by the assumption that the M.4 would have to pass south of the town on a route included in the Berkshire County Council's development plan. Because of a provision to this effect in that development plan, earlier proposals for a southern loop within Reading were abandoned.
      This earlier loop road was planned to link Oxford Road with Wokingham Road and London Road through areas which were either then underdeveloped or only just being developed. Since abandoning these earlier proposals, this route has been largely developed by housing, without any provision for the loop road; and no alternatives along these lines readily present themselves.
      Statistics of particular importance about the traffic in Reading are that there is an estimated volume of 29,000 vehicles a day which would use the motor way if it were planned along the southern and link road. This figure would decrease to about 16,700 vehicles a day if the modified northern route was used. It is important to realise that through non-stop traffic, for which the motor way is primarily intended, amounts to about 10,000 vehicles a day. This is an average figure which obviously varies considerably and depends on the method of entry.
      About half of these vehicles are carried on the A.4 and, naturally, in the peak
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      holiday periods these figures are considerably increased. It is also interesting to note that about 90 per cent. of local traffic comes from points or goes to points in the area south of Reading—using the line of the railway track, the Great Western Railway, as the division between north and south.
      I will outline the problems which are illustrated by this north and south route. Travelling north or south through Reading one must cross either one of two bridges over the Kennet, both of which are narrow and able only to take a single lane of traffic passing in opposite directions. One must go under the main London railway line at one of two places and then cross either Reading Bridge or Caversham Bridge. These are individual bottlenecks which create the greatest possible problem to north-south traffic.
      The importance of this becomes obvious when it is realised that the whole of the industrial development affecting Reading is now taking place in the southern part of the town. That figure of 90 per cent. of the traffic is concerned specifically with the area south of Reading. If a motorway were placed north of Reading not only would this traffic have to use one or other of these two narrow points and crowd the centre of a thriving metropolis, but it would then have to pass through an area of residential development in Caversham, Caversham Heights and Emmer Green which, on all the evidence, is an area which is not easily developed for any sort of proper access for through traffic. Anybody who has seen the area of domestic homes in Caversham, and noted the problems of the hills, will realise that there would have to be the greatest demolition. Notwithstanding the problem of getting out on to Peppard Road, there are things which the local authority strongly recommends as being impracticable of development, whilst the Basingstoke Road, in the area of Reading, has been planned wide enough to take the necessary sort of traffic as that which would use the road which has been provisionally planned for many years south of Reading.
      Perhaps I may now refer particularly to a considerable number of reports which have, in fact, inundated Berkshire and which, I imagine, must have

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      reached the Minister's desk? They come from six preservation societies—the Chilterns and South Oxfordshire, the Tidmarsh Parish Meeting, the Mid-Thames Valley Association, the Berkshire Downs Villages Association, the Berkshire Preservation Society, and the Kennet Valley Preservation Society—and the only thing which I would point out is that five out of the six urge the southern route. The Kennet Valley Preservation Society urges the southern link road to the modified northern route after it has been around Reading.
      The reason that I feel it is necessary to initiate this debate is the sort of things which have arisen from some of these reports and studies. I would mention here the most excellently produced report of Messrs. Rose and Rigby Childs, but they have given views about Reading which I think should be quoted. If I may use a quotation from page 27, they state:
      "The line passing south of Reading may produce complications rather than a solution"
      and on page 68 there is the statement that a route south of Reading may produce more complications.
      But these two gentlemen neither saw fit to see the town clerk, the borough engineer, the planning officer, or myself before coming to any of these conclusions and this slightly worries me when I remember the sort of publicity that these reports have had. So far as Reading is concerned, there is a very real worry over the fact that there would be the greatest disruption if, in fact, traffic which goes through, and which is concerned with Reading, was routed on the northern side, How this would fit in, as has been said, particularly with the proposed development as the South-East Study, published last week, is difficult to see. Then, we shall have to have expansion for another 30,000 people—a balanced expansion of both office and industrial development—and for this the route should be on the southern side.
      The bottlenecks which would be produced are worthy of study, but are more simple of solution if the route is on the southern side. If the Ministry decides that it is in everybody's best interests that the route must go to the north of Reading, I must ask the Minister to guarantee the provision of a link route
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      from somewhere in the area of Calcot, to the west of Reading, going around the south of Reading and coming out somewhere in the Sonning or Twyford areas. My estimate of this is that it would be of an area of at least 10 miles, at an estimate, using the Minister's Road Technical Paper No. 50, of £425,000 a mile.
      Any argument about economies and saving by using the modified northern route will entirely disappear if the Government have to make a contribution for a link south of Reading, which must be essential. If the route goes north of Reading the whole of the new central plan for the civic centre of Reading will have to be reconsidered and the present arrangements scrapped, as well as extensive and impossible road improvements.
      I know that my hon. Friend will not give me the exact answer today, but may I urge him to consider most fully the position as it affects Reading, not only for the present but for the future, because it would be absurd to have to spend this millions of pounds and, at the same time, disrupt the whole of a town such as the Borough of Reading.
      11.31 p.m.
      The Parliamentary Secretary to the Ministry of Transport (Mr. T. G. D. Galbraith): As my hon. Friend the Member for Reading (Mr. Peter Emery) has said, the routing of M.4 is a question which has aroused considerable interest, and I am glad that he has raised the subject tonight, because to some extent the hopes and fears of the protagonists of the various possible routes have obscured the principal factors which must influence my right hon. Friend when he comes to make a decision.
      I think, therefore, that it may be useful to the House if I describe, first of all, the requirements which the route finally chosen has got to satisfy. As the House knows, M.4 is the London—South Wales motorway. Like the other roads in the main motorway network, it is primarily intended to provide a safe, fast route for long-distance traffic, in this case for vehicles travelling between London, Bristol and South Wales via the Severn Bridge. This primary requirement for long-distance traffic is a factor which must never be forgotten.

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      The position to date is that only two short lengths of this motorway have been completed so far—the by-passes of Slough and Maidenhead. By the beginning of next year, however, the connection between the eastern terminus of the road at Chiswick and the Slough bypass will be ready. At the same time, we hope also to have the entire length from the terminus at the western end of the Newport by-pass to Tormarton in Gloucestershire under construction. It is clear, however, that before these two lengths can pull their weight, they have got to be linked together, and it is over this link that controversy has arisen.
      For some years, as my hon. Friend has told the House, a tentative route has existed and has in part been protected in the Berkshire and Wiltshire development plans. This route, nowadays commonly called the southern route, is really a linking together of pre-war by-pass schemes for towns, including Reading on the A.4 route to Bristol. But when, some three years ago, the position was reexamined it was found that the route would require considerable revision to bring it up to modern motorway standards. Particularly important was the fact that it seemed probable that there were other routes which would be better for long-distance traffic.
      As a result, therefore, my right hon. Friend decided to have the whole route between Maidenhead and Tormarton reexamined, and consulting engineers were appointed in 1961 to carry out surveys and recommend a provisional line of route. These investigations added to the basic requirement of a route designed to serve long-distance traffic, the secondary need to serve major industrial towns lying between London and Bristol—that is, Swindon and my hon. Friend's constituency of Reading.
      As a result of this inquiry, three basic routes emerged. First, there was the southern route, which I have already mentioned. The second, which became known as the northern route, crossed the Thames near Shiplake, ran across the southern extremities of the Chilterns and crossed the Thames again near South Stoke. It then ran through the Vale of the White Horse, passing north of Swindon and so on to Tormarton. Both these lines were about 79 miles long. The southern line did not serve Swindon, but
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      the northern line through the Vale of the White Horse served both Swindon and, more distantly, my hon. Friend's constituency.
      The third line, known as the direct line, also crossed the Thames at Ship-lake and near South Stoke, and served both Swindon and Reading. It was also substantially shorter, to an extent of seven miles or 10 per cent. A saving of this magnitude would obviously be quite important, not simply because it would cost less to build, but more particularly because the running costs for the long-distance traffic would be less, too. I must emphasise, however, that the economic argument is by no means the sole argument for the selection of a route, though obviously it is a very important factor.
      Other factors which are taken into account are, for example, the effect of a particular route on amenities; and, unfortunately, as we know only too well, here all three possible basic routes run through very attractive and beautiful country and it is very difficult to say which is the most attractive and beautiful. This explains the number of preservation societies which have been active on this route, to which my hon. Friend has just drawn attention.
      My right hon. Friend, of course, recognised the peculiar difficulties of the direct route, and so in May, 1962, before steps were taken to begin surveying in detail, he decided to consult informally with the major local authorities. This was not an attempt to get them to commit themselves in advance. It was simply to get their reactions.
      In asking them for their reactions, my right hon. Friend indicated a broad preference for the shorter and more direct line. In answer to his query, three of the counties affected by this line—Gloucestershire, Wiltshire and Berkshire—said that they saw no objection, but Oxfordshire was in favour of sticking to the southern route, and so was Reading, as my hon. Friend told the House, though Swindon, on the other hand, saw no objection to the direct route.
      As a result of these consultations and other advice that my right hon. Friend received, the direct line was modified. This produced three advantages. In the first place, the second crossing of the Thames was brought further south to the

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      neighbourhood of Purley, and as there are more trees in this area, it would make the crossing less obvious. Secondly, it brought the route nearer to Reading, and thirdly, except in the area between Great Shefford and Baydon, it avoided the high downland. Furthermore, the modified direct route line was, if anything, slightly shorter than the direct route itself.
      It was this modified direct route which my right hon. Friend announced in January, 1963, as a basis for consideration. Of course, my right hon. Friend cannot take a final decision until he has published draft proposals, studied any objections to them, and, if necessary, held a public inquiry and considered anything that emerges from it.
      Since the publication of the modified direct route, some survey work has been taking place on this line and also upon some alternatives. One of these alternatives which has only recently been suggested also runs south of Reading. But immediately west of Reading it swings north-westwards to join the modified direct route. This route, which the Reading report prefers, avoids the Thames crossings, but as it passes through a low-lying area it would have to run on an embankment with the existing roads carried over it on humpback bridges which would be difficult to fit into the landscape. Furthermore, this route is nearly three miles longer than the modified direct route.
      So the present position is that these surveys are now being embodied in the full report which my right hon. Friend expects to receive very shortly from his consulting engineers. Naturally, until he has considered the report carefully and has consulted the local authorities and other interests, he cannot possibly reach a decision. But once he has made up his mind, the route chosen will be published for public appraisal and objection as laid down in the Highways Act, 1959. Then there may well be a public inquiry, and it is only after all this has been studied that my right hon. Friend will be able to make his final decision.
      Since my right hon. Friend is still awaiting a full report, I am sure that the House and my hon. Friend will understand why I have been able to
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      touch only superficially on some of the merits of the various schemes and why what I say in regard to the points raised by my hon. Friend will also to a certain extent be superficial.
      One point which is sometimes made is that the extra cost of bridge structures over the Thames would make the cost of the modified direct route much the same as that of the modified southern route; but the bridges over the Thames, even with their associated viaducts, would not be so expensive as to counterbalance the cost of the greater number of smaller bridges which would be required on the other routes nor the need for embankments in areas of poor drainage.
      Mr. Emery rose—
      Mr. Galbraith: I would like to finish. My hon. Friend asked a great many questions, and I am worried about the time. If I can finish in time, I shall be delighted to give way.
      All our preliminary estimates show that the cost per mile of the various routes will be broadly similar, so that in respect of cost the advantage, such as it is, lies with the shortest route.
      From these general considerations, I come now to my hon. Friend's constituency and the case which Reading has deployed in its report on the Reading and District Traffic Survey. As my hon. Friend probably knows, we have only recently received this report, and we are at present studying it very carefully. My right hon. Friend's consulting engineers have already been in touch with the borough engineer to clarify some sections of the report. What emerges in general from the report, I think, is that Reading, perhaps naturally, has a view of the function of the motorway diametrically opposed to that of my right hon. Friend.
      The report makes clear that there is only a marginal difference in the amount of east-west through traffic which will transfer from the A.4 route to the motorway, whether the motorway goes north or south of the town. But Reading is anxious—this is something which has emerged from the traffic survey—to use the motorway as part of a relief ring road to keep north-south traffic out of the town. This is a proper and understandable desire on the part of Reading, but

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      I am not sure that it is really a legitimate use of a main national route to the West, to use it over a short distance as a relief ring road for a particular town. If there are a lot of short-distance drivers entering and leaving the motorway, this will obviously cause unnecessary hazards to the long-distance traffic. This does not mean that a relief road may not be necessary, but we do not believe that it is the function of a long-distance motorway to be used for this purpose.
      The report which Reading produced emphasises the difficulties which traffic attempting to gain access to a motorway junction north of the town would create. My hon. Friend has referred in particular to the capacity of the bridges over the Kennet and the Thames and to the problems which arise because of the railway bridges in the town. These potential difficulties have been recognised from the start. But our preliminary view is that traffic from the industrial areas in the south of Reading would use proposed junctions east and west of the town, so that the fear expressed in the report and by my hon. Friend tonight may well not come to pass. Certainly, some of the routes out of the town will have to be improved, but this is probably true whichever route is finally chosen.
      My hon. Friend has referred to the possible attraction of traffic from the south to Reading if the line chosen for the M.4 passes north of the town. But is it not more likely—my hon. Friend with his local knowledge will be able to say whether he agrees—that such traffic, if it wishes to join the motorway, will prefer to use one of the junctions east or west of the town, depending on its destination? Moreover, some of this traffic, if travelling to London, may well prefer to join the projected Basingstoke motorway.
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      I emphasise again that the function of the M.4 is primarily to serve long-distance east-west traffic. I assure my hon. Friend that the report is being considered in this context. Even if the figures quoted for the cost of the relief road by my hon. Friend are correct, it is not true that the financial advantage of the modified direct route disappears. My hon. Friend has left out of consideration, I think, the extra cost to through traffic of the extra mileage he would impose on it for the benefit of Reading.
      In conclusion, I stress once more that all I have said is no more than our preliminary reactions. The report was sent to us only on 4th March, and any new factors which emerge from it and which have a bearing on the routing of the M.4 will, I assure my hon. Friend, be taken fully into account. I hope that nothing I have said tonight will be construed by people outside the House as implying that my right hon. Friend has already made up his mind on the route to propose in a draft special road scheme. He has not yet received his consulting engineers' report. When he does, all the factors, the implications of economics, amenity, planning and agriculture must then be fully considered.
      It is a most difficult decision that my right hon. Friend has to take, as, I think, my hon. Friend appreciates. I assure him, however, that the valuable points which he has raised tonight will certainly be amongst those which will be weighed carefully before the final decision is taken.
      Question put and agreed to.
      Adjourned accordingly at fourteen minutes to Twelve o'clock.