HC Deb 19 January 1967 vol 739 cc770-9

It shall be the duty of the Corporation, in formulating any recommendations to the Minister relating to the activities that have fallen to be carried on under their ultimate control whether by way of conclusions reported to the Minister under Section 4 of this Act or otherwise and in carrying on those activities, to have regard to the advantages of preserving the good will attached to the names and trademarks of the companies specified in Schedule 1 to this Act and of their subsidiaries.—[Mr. J. H. Osborn.]

Brought up, and read the First time.

9.0 p.m.

Mr. J. H. Osborn

I beg to move, That the Clause be read a Second time.

I am greatly encouraged by the change of heart of the Government, and because of that I shall endeavour to be brief. Perhaps that will encourage the Minister to be generous. Although the Clause may not mean very much to us it is vital to those who have charge of the destiny of the steel industry when it is nationalised. The Minister has implied that I might have a bias towards the private sector because of my interest in it. I hope that he will have realised by now—especially from my comments last night—that I am anxious that the Corporation should be a success and that it should take whatever decisions are necessary to ensure a healthy, successful and prosperous industry.

I also assure the Minister that any member of the private sector who will be competing against the public sector will hope that the Minister will accept the Clause or the sentiments behind it, because if the Corporation were too rapidly to abandon trade marks and names which have become well-established, the customers of the Corporation, whether at home or overseas, would become restless and look elsewhere. It would be a disaster if, within a few weeks of vesting date, we found that all the trade names were amalgamated under specifications starting with National Steel Corporation Specification No. 1 and that if a person wanted some bonded or coated steel he had to ask for N.S.C.S. No. 503. If that system were put into practice it would mean that we had completely failed to sense the demands of customers, and it would absolutely wreck not only part of the home trade, but certainly the export trade of this valuable industry.

The Benson Report refers on pages 28 and 29 to the export trade and it is estimated that by the mid-1970s the gross exports will be 5.4 million ingot tons and that net exports will be 4.2 million ingot tons. These estimates may have to be revised, but unless the Corporation sells with delicacy those forecasts will never be achieved.

It is worth considering how we sell steel, and what methods are applied. There may be a difference between selling bulk steels and special steels such as alloy, tool, and heat resisting steels, many of which are made by the private sector, but I have emphasised before, and I do so again, that a technical salesman must find out what the customer wants. The customer will have the specification. He wants to know what the heat treatment will be, or what kind of finish the product will have. When the customer knows what he wants he usually settles on a brandname that gives it to him and thereafter he finds that he can have consistency in his machine shop or engineering shop.

One may ask how a customer identifies his requirements. There are many national and international specifications which may be used. I always keep in my diary a list of specifications used by the company with which I am associated, but correlated to the specifications of EN, Aircraft D.T.D., British Standards, and S.A.E., and sometimes the company's specification is related to national or international standards.

I do not want to digress too far, but the customer—either the engineer or the technician—will usually refer to an international specification when defining what he wants and tell the supplier or the steel manufacturer, but the steel manufacturer also has specifications of his own relating to various well-known trade marks. I have a list here of some of the names. There is Stelvetite, Dragonite, Silverfox and Fortiweld—all names well known by customers. I suggest that the importance of goodwill cannot be measured or quantified. Over the years, companies have made reputations for specialities like steel erecting, fencing, coated steel sheets, and steel work. All this may be kept, or lost within one vast organisation, unless the principle of the Clause is preserved in practice, whether it is accepted in the Bill or not.

I suggest that the Minister's interests must rest with this principle and I hope that the generosity which he showed before will be repeated—

Mr. Marsh

indicated dissent.

Mr. Osborn

I see the Minister shaking his head, but I hope that he will justify that view. Unless he accepts the sentiments behind the new Clause, the Corporation will have difficulty in selling at home, but more particularly overseas. This is an important new Clause and I hope that the Minister will change his mind and accept it.

Mr. Freeson

I accept the hon. Member's sentiments. We have a great deal of sympathy with the object of the new Clause and recognise that considerable commercial goodwill is attached to the names of the present companies. It is not just a historic goodwill but is associated with the quality of the product and related to certain company names. There is no doubt that this would be as important an asset after nationalisation as before. We recognise also that, as a result of the associations with names over many years, a considerable loyalty to particular companies and groups has grown up.

These are particularly powerful considerations, which is why I begun by saying that we accept the sentiments expressed. They will no doubt influence the Corporation in its conduct of affairs and will be borne very much in mind by it when deciding how the public sector is to be organised. However, we cannot accept that this kind of provision should be written into a Bill. It does not require statutory expression. There might be situations in which it would be unfortunate to have such a requirement in the Bill, in view of the wide options which must be maintained in the Organising Committee to decide how it recommends future organisation of the industry.

Recommendations on the new framework might cut across the legislative insistence on retaining certain names. One must balance the two things fairly equally and leave it open for the Organising Committee. We are certain that the Corporation will have great regard to the considerations involved. However, the new Clause, if accepted, would merely be a declaration. It could not be particularly effective in organisation.

They are not the only considerations. I have indicated that there are others—those of loyalty and commercial goodwill associated with quality. Matters of organisation are ahead of us. The industry is to undergo major changes in this respect and it is well known that various concerns in the industry are already organised in different ways. They may be restructured according to the future grouping of the industry and it would be difficult to insist, by law, in these circumstances on the retention of names of particular concerns which were restructured to fit in with the recommendations of the Organising Committee.

Although we accept, in association with this idea, the need to maintain the vitality of what one would rightly describe as subordinate units of the industry, we must leave it open to central advisory authority, the Organising Committee, to make structural recommendations, which will be decided upon, and upon which the Corporation will go about organising the industry. It is widely agreed—this has been referred to time and time again during the past two days, and I have no doubt it was referred to time and time again in Committee—that the nationalised steel industry will have to be reorganised into a smaller number of large groups. There may be differences as to the precise number, but this will undoubtedly be the future of the industry.

As I have said, some of these groupings are likely to cut across the existing pattern of organisation with which names of particular companies are associated.

I do not propose to deal with what might come out of the report which the Organising Committee will put to the Minister, and consequently to Parliament, but this is undoubtedly a consideration which we shall have to bear in mind. It may be that in the future, when the reputation of the National Steel Corporation is established, the Corporation will wish to trade under its own name. It is true that there is nothing in the Amendment which would prevent this, but there seems to be little point in inserting into the Bill a provision which may become less and less appropriate as circumstances change in the future history of the industry.

For these reasons, which I hope I have put fairly, I hope that the hon. Member will not press the point he has made.

Mr. Barber

This is for me a very sad moment because, after all the strictures which I heaped upon the hon. Gentleman the Parliamentary Secretary in a previous speech, listening to him winding up the discussion on this Clause, it was my intention to make a nice conciliatory speech, a few happy observations, and to congratulate him. But, alas, I cannot do so. I will say in his favour that he has dealt with the points raised by my hon. Friend the Member for Sheffield, Hallam (Mr. J. H. Osborn) in moving this new Clause, but the arguments which he adduced do not carry conviction. He said, on the one hand, that the new Clause would be completely ineffective, and then he said that it would be insistence by law. He cannot have it both ways. The truth is that there would be, to use his phrase, no insistence by law if the Clause were to be carried.

The Clause would lay upon the Corporation a duty in making recommendations to the Minister merely to have regard to the advantages of preserving the goodwill attached to the names and trademarks of the companies. That is not asking for a great deal. The Minister and the Corporation, at the end of the day, can make their decision, and they are fettered only to the extent that they must have regard to those advantages,

which are accepted by the Parliamentary Secretary on behalf of the Government.

I found his reply singularly unconvincing, but it is quite obvious that we shall not make any progress by pursuing the matter further. Therefore, I ask my right hon. and hon. Friends to support my hon. Friend by voting in the Lobby.

Question put, That the Clause be read a Second time:—

The House divided: Ayes. 228, Noes 301.

Division No. 238.] AYES [9.14 p.m.
Alison, Michael (Barkston Ash) Forrest, George Legge-Bourke, Sir Harry
Allason, James (Hemel Hempstead) Fortescue, Tim Lewis, Kenneth (Rutland)
Astor, John Foster, Sir John Lloyd, Ian (P'tsm'th, Langstone)
Atkins, Humphrey (M't'n & M'd'n) Fraser, Rt. Hn. Hugh (St'fford & Stone) Lloyd, Rt. Hn. Selwyn (Wirral)
Awdry, Daniel Galbraith, Hn. T. G. Longden, Gilbert
Baker, W. H. K. Gibson-Watt, David Loveys, W. H.
Balniel, Lord Giles, Rear-Adm. Morgan McAdden, Sir Stephen
Barber, Bt. Hn. Anthony Gilmour, Ian (Norfolk, C.) MacArthur, Ian
Batsford, Brian Gilmour, Sir John (Fife, E.) Maclean, Sir Fitzroy
Beamish, Col. Sir Tufton Glover, Sir Douglas Macleod, Rt. Hn. Iain
Bell, Ronald Glyn, Sir Richard Macmillan, Maurice (Farnham)
Berry, Hn. Anthony Godber, Rt. Hn. J. B. Maddan, Martin
Biffen, John Goodhart, Philip Maginnis, John E.
Biggs-Davison, John Goodhew, Victor Marples, Rt. Hn. Ernest
Black, Sir Cyril Grant, Anthony Marten, Neil
Blaker, Peter Grant-Ferris, R. Maude, Angus
Body, Richard Gresham Cooke, R. Maudling, Rt. Hn. Reginald
Bossom, Sir Clive Grieve, Percy Mawby, Ray
Boyd-Carpenter, Rt Hn. John Griffiths, Eldon (Bury St. Edmunds) Maxwell-Hyslop, R. J.
Boyle, Rt. Hn. Sir Edward Gurden, Harold Mills, Peter (Torrington)
Braine, Bernard Hall, John (Wycombe) Mills, Stratton (Belfast, N.)
Brinton, Sir Tatton Hall-Davis, A. G. F. Miscampbell, Norman
Brown, Sir Edward (Bath) Hamilton, Marquess of (Fermanagh) Mitchell, David (Basingstoke)
Bruce-Gardyne, J. Hamilton, Michael (Salisbury) Monro, Hector
Bryan, Paul Harris, Reader (Heston) More, Jasper
Buchanan-Smith, Alick (Angus, N&M) Harrison, Brian (Maldon) Morgan, Geraint (Denbigh)
Buck, Antony (Colchester) Harrison, Col. Sir Harwood (Eye) Morrison, Charles (Devizes)
Bullus, Sir Eric Harvey, Sir Arthur Vere Mott-Radclyffe, Sir Charles
Burden, F. A. Harvie Anderson, Miss Munro-Lucas-Tooth, Sir Hugh
Campbell, Gordon Hastings, Stephen Murton, Oscar
Carlisle, Mark Hawkins, Paul Neave, Airey
Cary, Sir Robert Hay, John Nicholls, Sir Harmar
Channon, H. P. G. Heath, Rt. Hn. Edward Nott, John
Chichester-Clark, R. Heseltine, Michael Onslow, Cranley
Clark, Henry Higgins, Terence L. Orr, Capt. L. P. S.
Clegg, Walter Hill, J. E. B. Orr-Ewing, Sir Ian
Cooke, Robert Hirst, Geoffrey Osborn, John (Hallam)
Cooper-Key, Sir Neill Hobson, Rt. Hn. Sir John Osborne, Sir Cyril (Louth)
Costain, A. P. Hogg, Rt. Hn. Quintin Page, Graham (Crosby)
Craddock, Sir Beresford (Spelthorne) Holland, Philip Page, John (Harrow, W.)
Crawley, Aldan Hooson, Emlyn Pardoe, John
Crosthwaite-Eyre, Sir Oliver Hordern, Peter Pearson, Sir Frank (Clitheroe)
Crouch, David Hornby, Richard Peel, John
Crowder, F. P. Howell, David (Guildford) Percival, Ian
Cunningham, Sir Knox Hunt, John Peyton, John
Currie, G. B. H. Hutchison, Michael Clark Pike, Miss Mervyn
Dalkeith, Earl of Iremonger, T. L. Pink, R. Bonner
Dance, James Irvine, Bryant Godman (Rye) Pounder, Rafton
Davidson, James(Aberdeenshire, W.) Jenkin, Patrick (Woodford) Powell, Rt. Hn. J. Enoch
Dean, Paul (Somerset, N.) Jennings, J. C. (Burton) Price, David (Eastleigh)
Deedes, Rt. Hn. W. F. (Ashford) Johnson Smith, G. (E. Grinstead) Prior, J. M. L.
Digby, Simon Wingfield Jones, Arthur (Northants, S.) Quennell, Miss J. M.
Dodds-Parker, Douglas Jopling, Michael Ramsden, Rt. Hn. James
Doughty, Charles Joseph, Rt. Hn. Sir Keith Rawlinson, Rt. Hn. Sir Peter
Douglas-Home, Rt. Hn. Sir Alec Kershaw, Anthony Rees-Davies, W. Ft.
Drayson, C. B. Kimball, Marcus Renton, Rt. Hn. Sir David
du Cann, Rt. Hn. Edward King, Evelyn (Dorset, S.) Ridley, Hn. Nicholas
Eden, Sir John Kirk, Peter Ridsdale, Julian
Elliot, Capt. Walter (Carshalton) Kitson, Timothy Roots, William
Elliott, R.W.(N'c'tle-upon-Tyne, N.) Knight, Mrs. Jill Rossi, Hugh (Hornsey)
Farr, John Lambton, Viscount Royle, Anthony
Fisher, Nigel Lancaster, Col. C. G. Russell, Sir Ronald
Fletcher-Cooke, Charles Langford-Holt, sir John St. John-Stevas, Norman
Scott, Nicholas Thatcher, Mrs. Margaret wells, John (Maidstone)
Sharples, Richard Tilney, John Whitelaw, Rt. Hn. William
Shaw, Michael (Sc'b'gh & Whitby) Turton, Rt. Hn. R. H. Wills, Sir Gerald (Bridgwater)
Sinclair, Sir George van Straubenzee, W. R. Wilson, Geoffrey (Truro)
Smith, John Vaughan-Morgan, Rt. Hn. Sir John Winstanley, Dr. M. P.
Stainton, Keith Vickers, Dame Joan Wolrige-Gordon, Patrick
Steel, David (Roxburgh) Wainwright, Richard (Colne Valley) Wood, Rt. Hn. Richard
Stodart, Anthony Walker, Peter (Worcester) Woodnutt, Mark
Summers, Sir Spencer Walker-Smith, Rt. Hn. Sir Derek Worsley, Marcus
Taylor, Sir Charles (Eastbourne) Wall, Patrick Wylie, N. R.
Taylor, Edward M.(G'gow, Cathcart) Walters, Dennis Younger, Hn. George
Taylor, Frank (Moss Side) Ward, Dame Irene
Teeling, Sir William Weatherill, Bernard TELLERS FOR THE AYES:
Temple, John M. Webster, David Mr. Pym and Mr. Eyre.
Ahse, Leo Dewar, Donald Hunter, Adam
Albu, Austen Diamond, Rt. Hn. John Irvine, A. J. (Edge Hill)
Allaun, Frank (Salford, E.) Dickens, James Jackson, Peter M. (High Peak)
Alldritt, Walter Dobson, Ray Jay, Rt. Hn. Douglas
Allen, Scholefield Doig, Peter Jeger, George (Goole)
Anderson, Donald Driberg, Tom Jenkins, Hugh (Putney)
Archer, Peter Dunn, James A. Johnson, Carol (Lewisham, S.)
Armstrong, Ernest Dunnett, Jack Johnson, James (K'ston-on-Hull, W
Atkins, Ronald (Preston, N.) Dunwoody, Mrs. Gwyneth (Exeter) Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)
Atkinson, Norman (Tottenham) Dunwoody, Dr. John (F'th & C'b'e) Jones, J. Idwal (Wrexham)
Bacon, Rt. Hn. Alice Eadie, Alex Judd, Frank
Bagier, Cordon A. T. Edelman, Maurice Kelley, Richard
Barnett, Joel Edwards, Rt. Hn. Ness (Caerphilly) Kenyon, Clifford
Beaney, Alan Edwards, Robert (Bilston) Kerr, Dr. David (W'worth, Central)
Bence, Cyril Edwards, William (Merioneth) Lawson, George
Benn, Rt. Hn. Anthony Wedgwood Ellis, John Leadbitter, Ted
Bennett, James (G'gow, Bridgeton) English, Michael Ledger, Ron
Bidwell, Sydney Ennals, David Lee, Rt. Hn. Frederick (Newton)
Binns, John Ensor, David Lee, John (Reading)
Bishop, E. S. Evans, Albert (Islington, S.W.) Lestor, Miss Joan
Blackburn, F. Evans, loan L. (Birm'h'm, Yardley) Lever, Harold (Cheetham)
Blenkinsop, Arthur Fernyhough, E Lewis, Arthur (W. Ham, N.)
Boardman, H. Fitch, Alan (Wigan) Lewis, Ron (Carlisle)
Booth, Albert Fletcher, Raymond (Ilkeston) Lipton, Marcus
Boston, Terence Fletcher, Ted (Darlington) Lomas, Kenneth
Bottomley, Rt. Hn. Arthur Foley, Maurice Loughlin, Charles
Boyden, James Foot, Sir Dingle (Ipswich) Luard, Evan
Braddock, Mrs. E. M. Foot, Michael (Ebbw Vale) Lyon, Alexander W. (York)
Bradley, Tom Ford, Ben Lyons, Edward (Bradford, E.)
Bray, Dr. Jeremy Forrester, John Mabon, Dr. J. Dickson
Brooks, Edwin Fowler, Gerry McBride, Neil
Broughton, Dr. A. D. D. Fraser, John (Norwood) McCann, John
Brown, Rt. Hn. George (Belper) Fraser, Rt. Hn. Tom (Hamilton) MacColl, James
Brown, Hugh D. (G'gow, Provan) Freeson, Reginald MacDermot, Niall
Brown, Bob(N'c'tle-upon-Tyne, W.) Galpern, Sir Myer Macdonald, A. H.
Brown, R. W. (Shoreditch & F'bury) Gardner, Tony McGuire, Michael
Buchan, Norman Garrett, W. E. McKay, Mrs. Margaret
Buchanan, Richard (G'gow, Sp'burn) Ginsburg, David Mackenzie, Gregor (Ruthergien)
Butler, Herbert (Hackney, C.) Gordon Walker, Rt. Hn. P. C. Mackie, John
Butler, Mrs. Joyce (Wood Green) Gray, Dr. Hugh (Yarmouth) Mackintosh, John P.
Callaghan, Rt. Hn. James Greenwood, Rt. Hn. Anthony Maclennan, Robert
Cant, R. B. Gregory, Arnold MacMillan, Malcolm (Western Isles)
Carmichael, Neil Griffiths, Rt. Hn. James (Llanelly) McMillan, Tom (Glasgow, C.)
Carter-Jones, Lewis Gunter, Rt. Hn. R. J. McNamara, J. Kevin
Chapman, Donald Hale, Leslie (Oldham, W.) MacPherson, Malcolm
Coe, Denis Hamilton, James (Bothwell) Mahon, Peter (Preston, S.)
Coleman, Donald Hamling, William Mahon, Simon (Bootle)
Concannon, J. D. Hannan, William Mallalieu, E. L. (Brigg)
Contan, Bernard Harrison, Walter (Wakefield) Mallalieu, J.P.W.(Huddersfield, E.)
Corbet, Mrs. Freda Hart, Mrs. Judith Manuel, Archie
Craddock, George (Bradford, S.) Haseldine, Norman Mapp, Charles
Crawshaw, Richard Hattersley, Roy Marquand, David
Cronin, John Hazell, Bert Marsh, Rt. Hn. Richard
Crosland, Rt. Hn. Anthony Heffer, Eric S. Mason, Roy
Crossman, Rt. Hn. Richard Henig, Stanley Mayhew, Christopher
Cullen, Mrs. Alice Herbison, Rt. Hn. Margaret Mellish, Robert
Dalyell, Tam Hilton, W. S. Mendelson, J. J.
Darling, Rt. Hn. George Hobden, Dennis (Brighton, K'town) Mikardo, Ian
Davidson, Arthur (Accrington) Hooley, Frank Millan, Bruce
Davies, Dr Ernest (Stretford) Horner, John Milne, Edward (Elyth)
Davies, G. Elfed (Rhondda, E.) Houghton, Rt. Hn. Douglas Mitchell, R. C. (S'th'pton, Test)
Davies, Harold (Leek) Howarth, Harry (Wellingborough) Molloy, William
Davies, Ifor (Gower) Howarth, Robert (Bolton, E.) Moonman, Eric
Davies, Robert (Cambridge) Howie, W. Morgan, Elystan (Cardiganshire)
Davies, S. 0. (Merthyr) Hoy, James Morris, Alfred (Wythenshawe)
Delargy, Hugh Hughes, Rt. Hn. cledwyn (Anglesey) Morris, Charles R. (Openshaw)
Dell, Edmund Hughes, Hector (Aberdeen, N.) Murray, Albert
Dempsey, James Hughes, Roy (Newport) Neal, Harold
Newens, Stan Roberts, Gwilym (Bedfordshire, S.) Tinn, James
Norwood, Christopher Robertson, John (Paisley) Tomney, Frank
Oakes, Gordon Robinson, Rt. Hn. Kennet(St. P'c' as) Tuck, Raphael
Oram, Albert E. Robinson, W. O. J. (Walth'stow, E.) Urwin, T. W.
Orbach, Maurice Rodgers, William (Stockton) Varley, Eric G.
Orme, Stanley Roebuck, Roy Wainwright, Edwin (Dearne Valley)
Oswald, Thomas Rogers, George (Kensington, N.) Walden, Brian (All Saints)
Owen, Dr. David (Plymouth, S'tn) Rose, Paul Walker, Harold (Doncaster)
Owen, Will (Morpeth) Ross, Rt. Hn. William Wallace, George
Palmer, Arthur Rowland, Christopher (Meriden) Watkins, David (Consett)
Panneli, Rt. Hn. Charles Rowlands, E. (Cardiff, N.) Watkins, Tudor (Brecon & Radnor)
Park, Trevor Ryan, John Weitzman, David
Parker, John (Dagenham) Shaw, Arnold (llford, S.) Wellbeloved, James
Parkyn, Brian (Bedford) Sheldon, Robert Whitaker, Ben
Pavitt, Laurence Shinwell, Rt. Hn. E. White, Mrs. Eirene
Pearson, Arthur (Pontypridd) Shore, Peter (Stepney) Whitlock, William
Peart, Rt. Hn. Fred Short, Rt. Hn. Edward(N'c'stle-u-Tyne) Wigg, Rt. Hn. George
Pentland, Norman Short, Mrs. Renée(W'hampton, N.E.) Wilkins, W. A.
Perry, Ernest G. (Battersea, S.) Silkin, Rt. Hn. John (Deptford) Williams, Alan (Swansea, W.)
Perry, George H. (Nottingham, S.) Silkin, Hn. S. C. (Dulwich) Williams, Alan Lee (Hornchurch)
Prentice, Rt. Hn. R. E. Silverman, Julius (Aston) Williams, Clifford (Abertillery)
Price, Christopher (Perry Barr) Silverman, Sydney (Nelson) Williams, Mrs. Shirley (Hitchin)
Price, Thomas (Westhoughton) Skeffington, Arthur Williams, W. T. (Warrington)
Price, William (Rugby) Slater, Joseph Willis, George (Edinburgh, E.)
Probert, Arthur Small, William Wilson, Rt. Hn. Harold (Huyton)
Pursey, Cmdr. Harry Snow, Julian Wilson, William (Coventry, S.)
Randall, Harry Spriggs, Leslie Winnick, David
Rankin, John Steele, Thomas (Dunbartonshire,W.) Woodbum, Rt. Hn. A.
Redhead, Edward Strauss, Rt. Hn. G. R. Woof, Robert
Reynolds, G. W. Taverne, Dick Wyatt, Woodrow
Rhodes, Geoffrey Thomas, George (Cardiff, W.) Yates, Victor
Roberts, Albert (Normanton) Thomson, Rt. Hn. George
Roberts, Goronwy (Caernarvon) Thornton, Ernest TELLERS FOR THE NOES
Mr. Harper and Mr. Grey.