§ 12.16 a.m.
§ The Minister of State, Board of Trade (Mr. George Darling)
I beg to move, That the Furniture Industry Development Council (Amendment No. 3) Order 1967, a draft of which was laid before this House on 5th July, be approved.
The Order has been approved in another place, but not before one aspect of the Order has been somewhat criticised. As I understand that similar criticisms may be directed at the Order in this House, I will try to meet what I think is the criticism in my explanation of the Order. I regret that my speech will, therefore, be somewhat longer than I had intended, but I will be as brief as I can.
This Order is made under the Industrial Organisation and Development Act, and it amends the original Order made in 1948 which set up the Furniture Development Council. The Council, as the House will know, was created to help the industry to become more efficient, more productive, to improve its designs and materials and the service that it gives to the public. Since it was set up, the Council has helped industry in many ways. It has developed useful ideas on production, management and engineering, financial control, costing, marketing, and so on, in all of which it is generally admitted that the Council's work has been very valuable.
Since 1961 the Furniture Industry Research Association, known as F.I.R.A., has been responsible for the industry's scientific and technical research. The Council and F.I.R.A. work very closely together and a large part of the levies which the Council collects from the industry is passed on to the Research Association to help with its work.
By Statute the work of the Council has to be reassessed every five years. The last review took place in 1966, and certain changes were then decided on. The object of this amending Order is to give effect to those changes. The first proposal is that the amount of the levy should be slightly increased. The second proposal is that the catchment area should be spread a little wider so as to bring in those firms which make certain types of built-in furniture and which have hitherto not paid the levy. As a 243 result, the Council will have rather more funds at its disposal.
§ Mr. John Hall (Wycombe) rose—
§ Mr. Darling
It is all right; I am not repeating the speech which was made in another place—only up to this point, at any rate.
§ Mr. Darling
Of course, this will mean that it will be able to give better service to the industry. Incidentally, as the hon. Member for Ormskirk (Sir D. Glover) knows very well, the other development council to survive since the Act was passed in 1948, the Cotton Board, has also recently extended its coverage to manmade fibres to take account of the technical changes which are taking place in the textile industry. Of course, it has had to change its name to the Textile Council.
§ Sir Gerald Nabarro (Worcestershire, South)
If the Minister would permit me to interrupt, I ask him this. He has twice referred to "built-in furniture". I declare an interest straight away in that I believe most hon. Members know that I have been associated with the timber trade all my life, but what is "built-in furniture"? Where does one find the definition? May I ask for clarification on this before we go any further?
§ Sir G. Nabarro
Would the right hon. Gentleman permit me again? I see that there is in paragraph 3 on the third page —the pages are not numbered—a copious definition of the word "furniture" but that does not seek to cover "built-in furniture". I simply want to know what is "built-in furniture" in this context.
§ Mr. Darling
The definition is in paragraph 3 which states:furniture' means furniture made of any material, whether assembled or not"—leaving out what is not relevant at the moment—… and whether designed to be free-standing or to be affixed to premises …"."Built-in furniture" is that fixed to premises, and that, I think, adequately 244 covers the furniture which the hon. Gentleman has in mind.
§ Sir G. Nabarro
I am grateful to the Minister, but he will be aware that tens of thousands of houses built in this country each year have an alcove. If a nest of wood shelves is put in that alcove, do they become "built-in furniture" or are they part of the builder's equipment?
§ Mr. Darling
It is "built-in furniture".
The main purpose of this Order, as I was about to say, is not an extension of its scope, and the more important purpose is to take account of the many and various technical changes which have taken place in the industry in recent years.
To come to the main points which I think may well be raised by hon. Members, I should mention that this Order safeguards the position of the "small" man, whether he makes traditional furniture, metal furniture, or "built-in furniture" so long as it is all on a small scale. The Order provides that he should be excluded from levy payment if his turnover in leviable items is £3,000 or less a year.
§ Mr. John Hall
On a point of order. Is it in order for the Minister to quote verbatim from a debate in another place? Consistently, he quotes from what is obviously the same speech used by his noble Friend in the debate on this Order in another place.
§ Mr. Deputy Speaker (Mr. Sydney Irving)
It is not out of order for an hon. Member to quote Ministerial speeches made in another place, but it would be better if they were paraphrased.
§ Mr. Darling
I accept your Ruling, Mr. Deputy Speaker, but I have either to paraphrase or use some of the words used in the other place, because this is the same Order as was debated in another place. However, I will paraphrase.
This is a new provision. I do not think that any hon. Member can tell me how I can paraphrase that. It will mean that the small man will pay the levy, and get all the benefits of research, and so on, but will make no payments by way of contributions towards that. It is right that we should understand the services 245 which all firms, large and small, will receive from the contributions which all but the small firms will now be required to pay. No hon. Member who has know- ledge of the industry will deny that the Furniture Development Council and the Furniture Industry Research Association provide excellent services to any and every firm in the industry which wishes to take advantage of them.
It was suggested in the other place, if I may paraphrase not the speech of my hon. Friend but that of another hon. Lady, that all that is done at the Research Association is to test pieces of traditional furniture and bring out ideas for improved designs or for better materials. That is an important field, but it is only a small part of the Council's work. I have been to the Research Association's premises, and I am sure that all hon. Members who have been there will agree that the scope of the work undertaken by the Association is most impressive.
§ Sir D. Glover
What the right hon. Gentleman has said about the inclusion of built-in-furniture covers every builder who builds a house. Is that so?
§ Mr. Darling
All the manufacturers of furniture items, like cupboards, which are affixed to the premises by the builder will be covered. I agree that the fixing is done by the builder, but he has to build the furniture and affix it to the premises. This is what is known as built-in furniture.
§ Mr. Darling
No. May I continue with the argument?
I am asking the House to approve an Order of which this extension of cover- age is only a small part. The scope of work of the Research Association covers much of the activities of, and will be very helpful to, the manufacturers of what we are calling built-in furniture.
§ Sir G. Nabarro
But we must have this point cleared up now. A builder puts up a house. He puts an ordinary wooden dresser in the kitchen. That builder is not a furniture manufacturer. He puts together a few pieces of wood and affixes them to the wall. If the right hon. Gentleman's argument holds water, how- ever, it leads to the conclusion that every 246 builder putting up a house anywhere with a few wood fittings inside it is then required to contribute to this levy as though he were a furniture manufacturer, which he is not. That is manifest nonsense.
§ Mr. Darling
No. Wait a minute.
The items of built-in furniture in every house can be defined. There are some cases in which the definitions will, perhaps, be a bit blurred, and I was coming to that point in its appropriate place. But, generally speaking, I understand that one now has, in the building not only of houses but of other residential property, quite a lot of furniture which is built in by the builder. I understand that this is the work which is done usually by the firms which belong to the Woodwork Manufacturers Association.
§ Mr. Patrick Jenkin (Wanstead and Woodford)
There is some confusion here. I have the impression that the right hon. Gentleman has not read on in the definition paragraph. In paragraph 3(a, i) it is made clear that this Order is not to includefurniture designed to be affixed to premises and made … by any person pursuant to a contract entered into by him to supply and affix such furniture".Will not the right hon. Gentleman agree, therefore, that the example put by my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) cannot be included, whatever other obscurities there may be and despite what the right hon. Gentleman is now saying in arguing that it should be included?
§ Mr. Darling
No. I was coming to the point, perhaps in rather a clumsy way, of the builder who puts into the house a certain amount of what I have been calling built-in furniture. I understand that the furniture is supplied by the manufacturer, a person who calls himself a joiner or carpenter. The words "supply and affixed" look after this point. If the manufacturer supplies the furniture to be affixed by the builder he is caught by the levy. If a person supplies and affixes he 247 is not caught, because he is in the building industry. That is the point.
§ Sir Harmar Nicholls (Peterborough)
Is the right hon. Gentleman saying that in this sense furniture is built-in only if it is supplied to the main contractor by another firm, and that if the builder affixes shelves or a cupboard it is not built-in furniture under the definition?
§ Mr. John Hall
It does not seem at all clear from paragraph 3 of the Schedule that what the Minister says is necessarily correct. Would it not be a fact that in the case of a firm of joiners making built-in furniture to supply to builders to instal themselves, if it were done pursuant to a contract to supply and affix such furniture it would not come under the levy system?
§ Mr. Darling
It must be supplied by a manufacturer to the builder. It then becomes built-in furniture. That is what I said.
I was going on to say that the Research Association undertakes a considerable amount of research of direct benefit to the member firms of the British Woodwork Manufacturers Association involved. I have a full list of its research projects for this year. I do not want to read them out, but I can say that a considerable part of them are of benefit to the manufacturers of what I have called built-in furniture, if the firms concerned wish to take advantage of them.
But this is not the whole work done by the Development Council and the Research Association. There are many other technical advisory services, on management, accountancy, and so on, of tremendous benefit to the firms concerned. Some member firms of the Woodwork Manufacturers Association make use of these research services directly and pay directly for them. Their inclusion in the levy scheme will enable the services to be provided for them on the basis of the levy instead, and will enable the Development Council and the Research Association to extend their special assistance to the firms which object to the levy.
I understand that the burden of the criticism and complaints by the Woodwork Manufacturers' Association is not that it did not wish to participate in 248 research services of this kind, which could be of great benefit to it, but that it was not properly consulted in the preparation of the Order. I understand that its first complaint is that it was not in the working party which brought forward the proposals forming the basis of the Order. I think that there is some misunderstanding here, because the working party reviewed every aspect of the work of the Development Council, as it is required to do under the Act, and was, therefore, drawn from the trades and trade unions already covered by the Council.
One among many of the working party's proposals was that the scope of the Development Council should be extended to cover built-in furniture. This and the other proposals in the Order were approved by my right hon. Friend the President of the Board of Trade. As soon as approval was given, Board of Trade officials so informed the Woodwork Manufacturers' Association on 28th February, five months ago, suggesting that there should be discussions about the matter, and a meeting was held on 22nd March. Since then there has been considerable correspondence and several offers of further meetings from the Board of Trade.
There has also been a meeting at the Ministry of Public Building and Works, which is the sponsoring Ministry from the complaining organisation, to consider the Association's objections to being included, concerning its production of this kind of furniture. Discussions have taken place and the Ministry of Public Building and Works supports the Order.
Having examined all the correspondence, the offers to meet and consult and the minutes of the meetings which have been held, I am completely satisfied that everything possible was done to have formal discussions with the Association to iron out any difficulties or objections that it might wish to put forward.
I can understand the point of view of the woodwork manufacturers. It is only in recent years that this kind of furniture has grown and become a significant part of the furniture industry. It is held that as they are manufacturers of some kind of furniture they should be brought into the scheme and allowed, within the aegis of the Development Council and the Research Association, both to pay their 249 contributions and to get the advantages that the Council and the Association can provide.
There is bound to be a bit of overlapping between the joinery trade, which is what I understand the hon. Member for Worcestershire, South has in mind, and what we look upon as the furniture industry. There is bound to be some blurring of any distinction between furniture as supplied to be built into buildings and the traditional free standing furniture which up to now has been the sole furniture to come within the Development Council's activities. There is no dispute that the development Council and the Research Association can provide great services to every section of the furniture industry, including the section that is complaining.
The cost will amount to about a packet of cigarettes for every £500 worth of built-in furniture that they may produce. This struggle is about one-twentieth of 1 per cent. of their output.
§ Sir G. Nabarro
The right hon. Gentleman referred a few moments ago to "every section of the furniture industry." Would he define the position of, first, school furniture and, secondly, garden furniture made of wood?
§ Mr. Darling
It does not include school furniture. This is still left out of consideration, because we thought that it would be extremely difficult to carry the definition forward when dealing with schools rather than with residential premises. However, it will include, for instance, residences provided by universities for their students, because these would count as residences and not as schools.
§ Mr. Darling
Garden furniture is not built-in furniture. I would have thought that even the hon. Member would have understood that.
§ Several Hon. Members rose—250
§ Mr. Darling
I have tried to deal with the arguments put forward in another place about the lack of consultation and the reasons which have been put forward to show why this Association does not want to join the scheme. But this is only a small part of the Order.
I think that it would be desirable, and that I would have the support of the whole House, in congratulating the directors of the Development Council and the Research Association on the good job of work that they have done over the years for the industry. This is generally admitted and accepted. I do not think that an opportunity like this should pass without the sponsoring department, the Board of Trade, putting on record its appreciation of the work which has been done by the chairman, Mr. Robert Faulk and by the Research Association under Mr. Keith Wrighton. They have done an excellent job of work and by approving the amendment Order we will enable them to make an even greater contribution to the future of the industry.
With the backing of hon. and right hon. Members on the last two points, at any rate, I commend the Order to the House.
§ 12.45 a.m.
§ Mr. Patrick Jenkin (Wanstead and Woodford)
The right hon. Gentleman has made it abundantly clear that there is strong opposition to the Order. In contradistinction to his usual lucid self that is about all he has made clear. The fact is that a section of the joinery industry which has always been part of the building trade is for the purposes of the Order to be treated as part of the furniture industry.
We are critical of the Order on two counts. One is the technical problem involved with built-in furniture. The other is the procedural point and the question of consultation. On the technical issue, there can be little doubt that the Order is misconceived and that it seeks to treat built-in units as furniture. Like my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro), I notice that the Minister of State referred throughout to built-in furniture. That is almost a contradiction in terms. These are built-in units and are to he treated artificially as furniture in the Order.
251 On the procedural point, the consultation which the right hon. Gentleman's Department had with the principal trade associations concerned and with the trade union, the Amalgamated Society of Woodworkers, which is opposed to the Order, has been totally inadequate. The joinery industry was not represented on the working party which was set up to advise the President of the Board of Trade on the technical content of the Order. The result of this was the right hon. Gentleman got into difficulties in dealing with the points of my hon. Friends.
The effect of the Order is obscure, and as explained by the officials of the Board of Trade to the B.W.M.A. is illogical and cannot be supported on any grounds. There is no obligation to secure the consent of any part of an industry to be be brought within the ambit of the development council. However, the Act says that whenever a new council is to be set up not only must the Government consult with that industry, but must not set up the Council unless they are satisfied it is wanted by a substantial proportion of that industry. I would have thought that the Government would have gone to great lengths to secure agreement when they were proposing to tack part of an industry onto an industry already there. The Order is, therefore, probably not ultra vires. I cannot congratulate the right hon. Gentleman on the way in which the matter has been handled by his Department, because the B.W.M.A. has been only partially consulted and the consultation did not extend to the technical details. Even the broad merits of the consultation were left incompete and interrupted just after they started when the Government tabled the Order and debated this matter in another place.
I should like briefly to run over what has happened. It is common ground that the initiative for this change came from the Furniture Industry Development Council. It is not disputed that the Council was anxious to increase its funds and was looking for new sources. Hitherto it had been acting for free standing furniture only and since 1948, under the first Order, this has been the definition of furniture.
252 The joinery industry, which makes things like doors, window frames, stairs and cupboards, had always been quite separate, but it was the joinery industry which first developed built-in units. It developed the whole market for kitchen units and bedroom units and for built-in cupboards and developed the standards in conjunction with the building industry and the British Standards Institution and other bodies, and the industry enjoyed rapid growth as a result. Therefore, it was not for some years that the traditional furniture industry, the freestanding furniture industry, moved into this new trade, and it is this industry which is the newcomer, whereas the joinery industry has been making these things for 20 or 25 years.
It is conceded by the Government, and was conceded in another place, that the joinery industry accounts for more than half the present market for built-in units. I believe that the figure is 60 or 70 per cent., with only the remaining minority being made by the furniture industry proper.
I have mentioned these things at some length because there appears to be a fundamental misapprehension in the Board of Trade. Speaking for the Government in another place, the noble Lord, Lord Walston, said:… over the past years those who are normally engaged in the joinery trade have become increasingly involved in the furniture trade. A larger amount"—and this is the crucial sentence—of the built-in furniture specifically is now being manufactured by people who normally are joiners and woodworkers ….—[OFFICIAL REPORT, House of Lords, 17th July, 1967; Vol. 285, c. 153.]I emphasise the word "now". The implication is that this was originally a development of the furniture industry and that the joiners and the woodworkers muscled in later, whereas the exact contrary is the truth.
This was made very clear in a letter to the B.W.M.A. by Mr. Thomas Sibthorp, who is the architect adviser and was chairman of the B.S.I. committee on kitchen fitments. He wrote:… in fact, the reverse is true so far as built-in units are concerned because it was the work of the E.J.M.A."—the B.W.M.A.'s predecessor—in first of all bringing out the Standard for these units, producing them, selling them and 253 fostering a British Standard, that created the market for this particular form of built-in unit which certain sections of the furniture industry have now copied for their own use. In this particular field they have contributed practically nothing and taken a considerable amount".
§ Sir D. Glover
Why did not the Development Council, which is supposed to be so valuable, get the furniture industry to produce built-in furniture much earlier instead of leaving it to the joinery side?
§ Mr. Jenkin
I imagine that the joinery industry, with various other trade and research associations, was doing all the work necessary in this respect and there was no reason for the Development Council to get into it. However, the Board of Trade appears to have accepted from the outset the view that it was, as it were, a natural extension of the furniture industry and to think that it should now swallow this section of the joinery industry.
Lord Walston also said that it was obvious on pure grounds of simple logic. It was obvious to no one except himself. But I have no doubt that that is why in their dealings with the B.W.M.A. the Board of Trade official did not think it necessary to embark on detailed comprehensive consultations from the beginning, thinking that this was a development by the furniture industry, not recognising that it had been an integral part of the building industry for many years.
The first approach was, the right hon. Gentleman said in March, to discuss built-in units. The B.W.M.A. thought that this was a purely fact-finding and informal meeting, although it clearly discussed the sort of suggestions which are now involved in this Order. This was followed by a letter of 14th April in which it was stated that the Board of Trade proposed to bring within the scope of the Order domestic type built-in furniture.
In that letter the B.W.M.A. was promised consultations when the full draft was available. By now it was very concerned. It consulted counsel, and as a result of that it sought the help of the Ministry of Public Building and Works. The Ministry agreed to help, and a meeting was fixed for 26th June. In the meantime, the draft Order had been prepared and as I have said the B.W.M.A.
254 was not represented on the joint working party. The Order was sent to the B.W.M.A. on 9th June.
I will read an extract from a letter of 9th June. It said:If it is your wish to discuss the draft with the Board of Trade as a separate matter from the discussion to be held on 20th June with the Ministry of Public Building and Works the necessary arrangements will be made on receipt of a telephone call here.The B.W.M.A. promptly wrote back that a further meeting would be required. A meeting was held on 26th June and the B.W.M.A. at that stage tabled a very full memorandum setting out in detail its objection to the Order. It asked three principle questions of the Board of Trade Officials attending the meeting.
First, it wanted a comprehensive list of the items which were to be included in the Order. Secondly, it wanted a definition distinguishing those which were to be in, and those which were to be out of the scope of the Order. It asked for the logical grounds for a definition. Thirdly, it wanted the Government's reasons why the Development Council felt it necessary to widen the definition.
This meeting was followed by a long letter from the Board of Trade, in which it answered the first of those questions. It set out a list of items that were to be in and out, and the products that were to be covered. This is a very obscure, illogical division. The ordinary wall and cupboard units, dressing table units, drawer and cupboard base units, sink units, were to be included. Airing cupboards, hob and oven cupboards, and refrigerator casing units and things of that sort were to be out. There is no rhyme or reason in this.
Every firm making a comprehensive range of built-in units produces such units, yet some are to be in and some out. In addition, there is a substantial area of doubt. What about shelves in a cupboard? Or an alcove to be enclosed by a cupboard door, or hot air cupboards, built-in units, meter containers? What about this new development in movable partitions, with the partitions consisting of fitted wardrobes? Are those to be regarded as built-in units, or part of the joinery of the house?
The Order is clearly defective in this respect. The reason is because the 255 B.W.M.A. was not consulted on the technical content.
§ Mr. Darling indicated dissent.
§ Mr. Jenkin
The Minister shakes his head, but he admitted this, and this is the consequence of failing to consult the B.W.M.A. It is also on the face of it, incomplete. It is worth while looking at the opening paragraph of the letter of 3rd July, when the Board of Trade wrote as follows:I am also taking the opportunity of commenting on some of the major points made in your memorandum tabled at that meeting, although you will appreciate that it is not proved possible in the time available to deal with them comprehensively.There we have so far no sign of the second meeting offered, and that offer had been accepted. We have no full reply to the comprehensive memorandum tabled by the Association. On 5th July two things happened. The first was— —
§ Mr. Jenkin
If I am wearying the House I will hurry on, Mr. Speaker.
The fact is that on 5th July there was a long commentary by the Association. On the same day the Board of Trade laid the Order. That was greeted by a reaction by the Association of shock and anger. It realised at that point that the Board of Trade had no intention of consulting the Association on the content of the Order. The Board of Trade has made it clear that it was not prepared to withdraw the Order, and it is well known that it cannot be amended in either House. The Association tried again, for it was anxious to have a further meeting. It reiterated its request for an answer to the two questions which had not been answered. However, six days later the debate took place in another place.
Were the Board of Trade still prepared to meet them? I telephoned the right hon. Gentleman and asked him whether he would meet representatives of the Association after the debate in the House of Lords.
§ Mr. Darling
The hon. Member ought to tell the House when and at what point that meeting was suggested. He asked me to meet a deputation this morning.
§ Mr. Jenkin
The only possible object of such a meeting would have been to persuade the right hon. Gentleman, even at that stage, to withdraw the Order. He refused to receive a deputation from the Association. I wonder why.
The result is that we have an important trade association with serious objections to the Order, which will affect it to no considerable extent. It objects in principle and in detail, and its representations went largely ignored and its complaints of inadequate consultation have been scouted. The Board of Trade wrote a letter stating that the original consultation in May was intended to be the consultation. The result is that we have an angry and resentful industry which is being frog-marched into a Council to which it has no wish to belong and to which it has no desire to pay a levy.
This brings me to the objections in principle, which I will deal with briefly. This industry, joinery, is part of the building industry. For decades it has been part of the building and construction industry and working hand in glove with it. The two have common standards and they have taken part in the building industry's efforts at metricisation. All that is quite irrelevant to freestanding furniture.
It contributes to the Construction Industry Training Board, its standards come under the Building Divisional Council of the B.S.I. and its labour negotiates through the National Joint Council for the Building Industry. Its research is done by the Forest Products Research Laboratory, the Timber Research and Development Association and the Building Research Station. It works on inter-firm comparisons—and all this is closely interwoven with the building industry.
Lord Walston suggested in another place that those who were opposing the Order were guilty of pigeon-holing and suggested that this was a restrictive practice. That is a highly specious appeal to prejudice. No one is seeking to remove pigeon-holes, but merely shifting an unwilling section of one industry into the pigeon-hole occupied by another.
That sort of argument merely makes people angry. The Minister could redeem the situation even now. This is a draft Order. There is no case for urgency.
257 I beg him even at this stage to withdraw the Order and to inform himself fully, as obviously he is not informed now, of the full details of the case and all the facts and to embark on genuine consultations both with the B.W.M.A. and with the trade unions who are opposing this Order.
If the right hon. Gentleman is still convinced that he is right, at any rate he will be on firmer ground, but if he presses on with the Order regardless of all the arguments addressed to his Department, then he will attract a totally uncharacteristic reputation for a high-handed dictatorial attitude wholly foreign to his character. I earnestly beg of him to think again.
§ 12.59 a.m.
§ Mr. Ted Fletcher (Darlington)
I hope that I shall not detain the House long, but many workers in my constituency are employed in the joinery trade and, in addition, a local firm of standing in the locality have asked me to make representations on this Order. The purpose of the Order appears primarily to be to increase the finances of the Furniture Industry Development Council and the effect would be that all built-in units such as kitchen storage units would be classed as furniture and would be liable for levy payment to the Furniture Industry Development Council. Consultation between the Department and the employers' association seems to have been inadequate. A Ministry official gave this assurance on 24th May:We shall be formally consulting the British Woodwork Manufacturers' Association as an interested organisation.In another communication on 9th June an offer was made to discuss the draft of the Order, which is like a judge who has found a criminal guilty consulting him on the words he should use in the sentence. It had been decided to bring certain sections of the industry within the Order and the association was to be consulted only on the form of words.
I do not know whether there has been any consultation with the Amalgamated Society of Woodworkers, but I know that there has been none with the Amalgamated Society of Woodcutting Machinists. The Department has not done everything possible to consult all interested parties. Section 1(4) of the original 258 legislation, the Industrial Organisation Development Act, 1947, says:A development council order shall not be made unless the Board or Minister concerned is satisfied that the establishment of a development council for the industry is desired by a substantial number of the persons engaged in the industry.There have been no consultations in the broad sense of the word. To me, as a former trade union official, consultation does not mean simply an assurance that one will be consulted, followed by consultation only on the draft of an Order which has already been laid.
It is suggested that a contribution from the joinery industry will greatly improve research, but the Manufacturers Association has a good record in research, spending many thousands each year and engaging consultants and advisers. This work may be duplicated if it has to pay additional levies for further research connected mainly with the furniture industry. There are bound to be difficulties over the definition of moving and non-moveable furniture, but that in the 1947 Act is quite clear and there seems no case for changing it. What special circumstances have led the Ministry to decide on a new definition?
There is no urgency about this. I hope that the Ministry will have second thoughts and, after consultation, will try to persuade the interested parties that it is in their long-term interests for sections of the joinery industry to pay a levy to the Development Council.
If there is no great urgency, is it possible for the Ministry to reconsider this whole matter? We are jealous of our privileges and we want decisions to be made only after the widest consultation with all the bodies concerned. Having gone into the matter in come detail, I cannot say that the widest possible consultation has taken place and I therefore appeal to the Minister to look at the matter again.
§ 1.6 a.m.
§ Mr. John Hall (Wycombe)
The Minister may gather, from my remarks, that I am likely to be the only friend he has; although I assure him that the friendship will be lukewarm. Not unnaturally, the furniture trade welcomes the Order, and since I represent a furniture-making constituency—we make some of the best furniture in the world; 259 this is not just a commercial, but a fact—I must put forward the trade's point of view.
There is a definite case for the inclusion of manufacturers of furniture, whether fixed or free-standing, although I agree that there is something in the objections voiced by several hon Members about the way in which the Order has been handled. Nothing said by the Minister so far leads me to believe that there has been consultation in the full sense of the word with the various interests.
The Board of Trade has carried out some consultation and has complied with the provisions of the Act. Without suggesting that anything illegal has been done and while agreeing that the Act has been complied with, I cannot believe that the fullest consultation has taken place. As a result, as has been suggested, organisations will be brought in screaming.
Knowing that objections would be raised, one would have thought that the Ministry would have gone out of its way to make certain that the most comprehensive consultation took place before the Order was laid and that all possible doubts were satisfied. Can the Minister assure us that all possible consultation took place?
There is a case for including the manufacturers of fixed furniture with the manufacturers of other furniture. The difference between fixed and freestanding furniture is that one piece stands by itself while the other is fixed to a wall or floor. In other respects, they may be absolutely identical. It seems illogical that they should be dealt with differently, with different research organisations handling their work.
§ Sir D. Glover
Is my hon. Friend aware that one can produce a so-called built-in wardrobe by placing a door over a brick-built alcove?
§ Mr. Hall
I doubt whether that would be defined as a piece of built-in furniture, not even in the obscure definition contained in this provision.
Manufacturers of built-in furniture enjoy certain advantages over their freestanding furniture counterparts. For example, by producing furniture which is virtually identical to free-standing pieces, because it is fixed to a wall in a house it 260 can be included in the purchase price of the property, so enabling the purchaser to pay for it over a long period on mortgage, thus avoiding the hire-purchase restrictions to which the purchaser of freestanding furniture has been subjected.
§ Mr. Speaker
Order. The hon. Gentleman must not broaden the debate. We are considering the question whether this group of manufacturers should pay the levy for the Development Council.
§ Mr. Hall
I was pointing out that the manufacturers of free-standing furniture have not enjoyed certain privileges which manufacturers of built-in furniture have enjoyed. I see no reason why they should not make similar, virtually identical, pieces of furniture.
I should like some clarification of the definition in paragraph 3 of the Schedule. In an earlier exchange when the Minister was explaining the Order some doubt arose in my mind as to what liability would arise in the case of a joiner making built-in furniture and providing it on contract to the house builder. I can understand that a builder himself making and fixing furniture to the houses he built would be excluded from the definition in the paragraph, but what about the joiner who has a contract to provide built-in furniture to builders? Is he not excluded from the provisions of the Schedule, which speaks of it being pursuant to a contract entered into by him to supply and fix such furniture?
If so, would it not be possible for the manufacturers of built-in furniture in most cases to evade altogether the levy that might otherwise be charged? In most cases, they could enter into contract with the builders of houses or other premises to provide, design and fix in premises this type of furniture for which they would be responsible—
§ Sir Myer Galpern (Glasgow, Shettleston)
I am sure that the hon. Gentleman knows full well that most white wood furniture without backs on it, to which we are referring—which is not the same as free-standing furniture—would largely be supplied by way of contract. The suppliers would have entered into a contract to fit these pieces of furniture into houses.
§ Mr. Hall
The hon. Gentleman is quite right—that is my point. As far 261 as I can see, the suppliers of furniture of that kind would be excluded from the effects of the Order by that paragraph.
I should have thought that in most cases the manufacturers of built-in furniture would be able to evade the full implications of the Order by entering into the contracts which he describes. That is one reason why the definition must be made clearer; it is not at all clear to manufacturers of either free-standing or fixed furniture what is covered by kite definition. The Minister would help the House greatly if he could give an interpretation of what it means.
§ 1.13 a.m.
§ Colonel Sir Harwood Harrison (Eye)
A factory in my constituency will be affected by the Order. I have had a letter from the chairman of the company, a man whom I regard as being very able in that line. He was the first president of the British Woodwork Manufacturers' Association when it was formed. I have listened very carefully to the Minister, and unless I am very much mistaken he has contradicted himself, though not intentionally, by what he has suggested comes or does not come within the definition.
Having been approached by those having the factory, I know that we are changing something that is long established. What was furniture and what was joinery was laid down by the late Sir Stafford Cripps, and the definition has never been departed from. From the papers with which I have been supplied, it seems to me that the joinery people have been extremely clever. They have been able to develop without any help from the Furniture Council, and, because they have been successful, they are asked to pay the levy.
I am sure that we all have a high regard for the Minister, but I believe that on this occasion he has been badly briefed. It is not like him to make that sort of speech. I also believe, from what I have been told by the people in the trade—and I will not go into details of how much consultation there has been—that even his officials in the Ministry do not understand the distinctions existing at present. The Order has been produced in a great hurry. What is the urgency of it? We are at the end of a long Session. This is produced 262 as the third Order after ten o'clock on a July night. It is an Order of importance to many people and should, therefore, receive proper consideration.
I ask the Minister of State to reconsider this and consult everyone involved. If he came back next Session and told us that he had gone into it and that this was right, I, for one, would then be prepared to accept it, but I do not believe that full discussion has taken place.
My constituents have told me that, much as they dislike the Order, they would be satisfied if another exception clause were inserted after sub-paragraph (c) in paragraph 3 of the Schedule. I do not say that my constituents have drafted this correctly. They are not draftsmen, nor am I. I commend to the Minister of State the words they would like to be inserted after paragraph 3(c) of the Schedule.
§ Mr. Speaker
Order. The hon. and gallant Gentleman knows that he cannot amend the Order. He can only speak against it.
§ Sir H. Harrison
I apologise, Sir.
It is the question of the so-called units of kitchen storage which is causing all the worry. I beg the right hon. Gentleman to withdraw the Order and bring it back next Session after having fully considered it and satisfied himself that it is right, because I believe that he will find that it is not so.
§ 1.17 a.m.
§ Mr. Brian Harrison (Maldon)
I think that the Minister has made a great mistake in bringing the Order forward at this stage without having had the right consultation and without having got it clear. We all admire the right hon. Gentleman's lucidity, but his speech tonight showed considerable confusion in definition, a confusion which is shared by all those who have examined the Order. This includes the manufacturers. It seems as if the Furniture Industry Development Council suddenly decided that it wanted some more money and looked round to see how it could cast its net a little wider and then decided that it would include built-in as well as freestanding furniture, irrespective of the fact that traditional built-in furniture has been dealt with by separate trade associations and. in many cases, by separate trade unions.
263 The definitions have caused much difficulty. Although the consultation may have been full and comprehensive by departmental standards, certain organisations think that there has not been adequate consultation. One trade union was consulted, but thinks that its views have not been taken notice of. Another trade union has not been consulted. The fact that the Association has not been fully consulted means that there is a grievance and a feeling that something is being swung on the industry.
All sorts of things look wrong and odd in this Order. All of us must be pleased that musical instruments, freestanding or built-in, are exempt. So is pottery. But all sorts of things should be considered in an Order such as this. For example, kitchen units made by joinery manufacturers whose workers are employed under the terms of the National Joint Council for the Building Industry, ought not to be included. This is another section which the right hon. Gentleman should look at. The Order will affect many efficient and able manufacturers. I beg the right hon. Gentleman to withdraw it.
I give another reason why it should be looked at again and the definitions made clearer. An industrialist or firm which has a wide range of manufacturing and a big joinery works will have to set up a special accountancy department to sort out just how much of its output is liable for the levy. This will lead to all sorts of skulduggery and sorting out to find what part of the output of the joinery works should be included. In my constituency a firm may be building not only furniture units, but staircases. These things will have to be itemised separately and a special form of accounting will have to be used.
All of us would agree that the Development Council has done a wonderful job, but this is a clumsy way of increasing its revenue. It has not been carefully thought out. There is the grossly unfair situation whereby many joinery organisations will belong to the Council and be paying into separate organisations. I beg the Minister to think again, to withdraw the Order now, have fuller consultation and bring an Order back after the Recess, when it can have the support of both sides.
§ 1.22 a.m.
§ Sir Gerald Nabarro (Worcestershire, South)
The largest import into the United Kingdom of any single commodity is timber, which accounts for more than £200 million per annum. Furniture manufacture, joinery and saw-milling are all branches of the timber trades of the United Kingdom. The difficulty of doing what the Minister of State is seeking to do tonight is to differentiate by definition between furniture and joinery. I say that it is impossible to differentiate within the compass of the relatively short definition in this Statutory Instrument.
I declare an interest at once. I am a director of quite a large number of firms engaged in the wood-working trades and industries of one kind or another. I have been associated with those trades nearly all my life outside the Army.
I intervened in the Ministerial speech and asked the right hon. Gentleman to define the term "built-in". Of course, he side-stepped. It is incapable of definition, like smoke. When the Clean Air Act was going through the House, I asked for a definition of smoke. It was said to be indefinable. The term "built-in" is equally indefinable. We have been talking tonight about kitchen cabinets. We may say that they are items of built-in furniture in that they are prefabricated. My hon. Friend the Member for Ormskirk (Sir D. Glover) countered that if there were an aperture in a wall in a house, and it was lined with block-board and a door placed on the front of it, that would represent an item of built-in furniture. I do not know. Nor do I know if, in a kitchen of a new house, shelves are erected by the builder of the house, that nest of shelves is to be regarded as built-in furniture. In my view, it is impossible of definition.
Here I come to my hon. Friend the Member for Maldon (Mr. Brian Harrison). He is correct. A very large number of joinery works in this country manufacture prefabricated items such as kitchen units, on the one hand, and, on the other, they carry out a miscellany of joinery work on the sites of houses being erected. Such a firm would then have to set up some kind of accountancy organisation, however crude, to distinguish between the built-in units and the direct joinery items.
265 Of course, this is not a new controversy. My mind goes back 11 years, to 1956, when I was assaulting the Chancellor on the question whether Purchase Tax was chargeable on garden furniture. I ask this evening: is garden furniture included or is it not? I will give way at once if the right hon. Gentleman will tell me.
§ Sir G. Nabarro
It is in. Garden furniture is in this Order now. But near my home in Worcestershire is the Wye forest, where thinnings are taken out of the forest and four poles of wood are nailed together to make a garden rustic arch. Purchase Tax is charged on it and, therefore, that little local rural industry will now be called upon to pay a levy.
§ Sir G. Nabarro
At what point he pays it I know not, but he will have to pay it eventually if he makes garden furniture. None of them has been able to distinguish when a piece of wood dressed, sawn and attached to another piece of wood becomes an article of furniture. That is really the point in this Order.
I am against this Order. It is very clumsily put together, in a most slipshod fashion. I shall not go over all the ground that has been covered already by both sides of the House, notably by the hon. Member for Darlington (Mr. Ted Fletcher), who alluded to the lack of consultation in this matter. I could tell the Minister of a dozen experts in timber and wood-cutting processes who could give him a far finer definition of the difference between joinery and furniture than that contained in this Statutory instrument. But there has not been reasonable time allowed for these consultative processes to go forward. The Minister is nodding. I do not want to delay the House. [An HON. MEMBER: "Divide."] My hon. Friends and I do not intend to divide.
§ Mr. Speaker
Order. Interruptions from hon. Members will only provoke the hon. Member who has the Floor to delay the House.
§ Sir G. Nabarro
I will not be provoked, Mr. Speaker.
My hon. Friends and I do not propose to divide the House on this mattes because we still believe that this is a non-party political issue. My hon. Friends and I do not object to the levy on the furniture industry at all, but we do object to the addition which is being made in this Order because it is so ill-defined as to lead to great confusion in the future.
It is on those grounds that we think it reasonable to say to the right hon. Gentleman, "Take your Order away. Do some more homework on your Order. Withdraw it tonight; this will incommode nobody." I have consulted various branches of the industry. They do not mind waiting three months. I am in the industry and I am much better informed than the right hon. Gentleman. [An HON. MEMBER: "Oh."] I am very modest about it. If I am provoked, I shall go on, keeping the hon. Member for Gravesend (Mr. Murray) out of his bed.
I say again, the industry would not mind a delay of three months, and I suggest that this Order is brought back in revised form in the last week of October with a clear distinction in it to show what is joinery and what is furniture. Then it would be a much more sound Statutory Instrument, both to my hon. Friends and to myself.
§ 1.31 a.m.
§ Mr. R. W. Brown (Shoreditch and Finsbury)
I will intervene only briefly, but I want to say that the criticism of my right hon. Friend is extremely unfair, especially in the matter of consultation. Listening to this debate tonight, and reading what was said in another place, it is quite clear that the Board of Trade cannot truthfully be accused of having failed to have proper consultations.
One sees from the debate in another place that there was a discussion on 22nd March, and continuing discussions on 14th April, 24th May, when further letters were sent on the subject, and further discussions were offered by the Board of Trade. On 9th June, the Board of Trade sent a copy of the draft Order to the B.W.M.A., and at a further meeting on 26th June, various points were made. 267 There was further correspondence on 3rd and 10th July, and it would seem that under no stretch of the imagination could it be said that my right hon. Friend failed to consult.
§ Mr. Jenkin
Was the hon. Member here when I said that a second meeting was offered, and accepted, but that that meeting was never held?
§ Mr. Brown
I have been here during the whole of the debate, but I did not interrupt the hon. Member. I wanted to do so, but I gave him the courtesy of allowing him to continue his argument, although hon. Members interrupted continuously during the speech of my hon. Friend.
The President of the Board of Trade has endeavoured right through these negotiations, which began in early March, to put his proposals before the organisations concerned. The problem he faced was how to meet people if they started from the very first with the premise that they would not have it. It does not matter if there is a three months' delay as suggested by the hon. Member for Worcestershire, South (Sir G. Nabarro) or three years' delay, but quite clearly, this organisation will not accept it, and what is proposed should be brought in within the terms of the present Order.
It is completely unfair for hon. Members opposite to keep on about "failing to consult". They have failed to consider at all what this Order is about. It is an attempt to ensure that people manufacturing furniture shall pay a levy. So, whether it is built-in or free-standing, the criteria are that if one is getting benefit from the work of a Development Council, then one should pay a proportion of the levy for it. It is as simple as that, and it is what was said in another place. It was there said that it was only logical that, if one manufactures furniture and one gets benefit from the Development Council, then one should pay one's proportion of the levy.
Here are some examples of work which the Development Council has done. It has done research into panels that warp. Is it suggested that built-in furniture has 268 no panels, doors or shelves that warp? Of course it has. The Council has prepared basic data regarding storage space. Is this of no value to the manufacturer of built-in furniture? Of course it is. He uses those data. The problem of sticking drawers and sliding doors occurs in both built-in and free-standing furniture, and research in this respect, also, is much valued. Is it argued that the manufacturer of built-in furniture derives no advantage from the research into adhesives and the stability of joints?
Plainly, those who make joinery products—they are in competition with furniture products—ought to take their share in paying the levy. I hope that my right hon. Friend will stand firm. Research and development in this industry needs to go ahead. We need an efficient organisation. We need greater productivity. Research and development is being undertaken. Everyone in the industry who derives a reward from it ought to contribute towards it.
§ 1.37 a.m.
§ Mr. Graham Page (Crosby)
The Act which this Order is made is one of those in which Parliament trusts the Department concerned to have consultations before an Order is made. Nothing is laid down regarding what sort of consultation it shall be, but Parliament trusts the Ministry to have reasonable consultation.
In this case, the consultation was insufficient from that standpoint. It was not insufficient from the legal point of view. The Minister could bring an Order to the House in draft and then go away and consult. That would still be legally right. He only has to consult the organisations concerned before he makes the Order. But, undoubtedly, in giving the Minister power to make Orders of this sort, Parliament intended that he should have proper consultations.
In this case, I cannot think that either side of the House is satisfied that proper consultations took place. It may have been something of the fault of the organisation concerned, which was antagonistic towards the Order. But it was antagonistic, I understand, towards the definition of the activity to be brought under the Order, and it wanted an opportunity to be consulted on that definition.
269 No one can be happy about the definition in paragraph 3 of the Schedule. It describes an activity of making furniture for domestic purposes, and then describes activities which are excepted from that definition. It should be noted that the Order affects the people who are carrying out these activities. We are not defining what comes under the Order by defining an activity; it is those who carry out the activity. To escape, they must always fulfil three conditions. The first is that they must design furniture which is to be affixed to premises. The second is that the furniture must always be made pursuant to a contract, and the third that that contract must be for the supply and affixing of the furniture.
If, in any contract during the year, they do not carry out any of those three conditions in supplying built-in furniture they are carrying out an activity which brings them within the levy for the Council. I understand that this is merely to get more money for the Council. If so, it is taking money from the builders of houses to give to the manufacturers of furniture, and is more than likely to increase the cost of houses.
I am not sure how the Order will work in connection with those building houses. I understand that those who have been installing built-in furniture have from time to time consulted the Council, and have paid a fee. They have, therefore, contributed to the money required by the Council. The levy imposed by the Order is for the year 1967, no matter at what time of the year it is imposed. No doubt those who have been installing built-in furniture have been consulting the Council during the year and paying fees. Now that they are called on to pay the levy for the year, will they get a rebate of those fees? It is a small point, but it affects the kind of Order we are discussing, which is retrospective and which the House should, therefore, study carefully.
If the House is to study it carefully, have one little teaser for the right hon. Gentleman. The fourth line of paragraph 2(2) of the Schedule includes the words "intends", which is obviously in the present tense instead of the past. It is a grammatical error which can be corrected in the reprinting, but these sort of things should not occur.
270 The right hon. Gentleman is wrong in asking the House to accept the draft with a definition such as there is in paragraph 3 of the Schedule, which will obviously cause immense trouble. It does not really go to the root of the matter and it is not helpful to those who must work it in practice. We are dealing with practical men involved in the building and furniture industries, not a lot of lawyers. They must work out the Order themselves without running to their legal advisers whenever a point arises. Therefore, we should give them a thoroughly understandable definition, which we have not done in the Order.
§ 1.44 a.m.
§ Mr. Darling
I should like to reply briefly to some of the questions. First, a very sensible definition was proposed to the Association on 14th April. It was thatBuilt-in furniture includes all furniture or parts of furniture of a type commonly used for domestic purposes whether or not supplied for domestic purposes and manufactured under factory or workshop conditions and taken to buildings and installed in such a way as to be fixed to the building or part of the structure.That was one definition we were prepared to discuss. There is another mention of built-in furniture in a Statutory Instrument which I am sorry the hon. Member for Crosby (Mr. Graham Page) cannot remember, that is the Industrial Training and Furniture Industry Board Order, 1965.
The reason why we are leaving it fairly vague is that the Order will bring in the manufacturers of built-in furniture. There may be many questions of borderline cases and so on which we would prefer to discuss with them in consultations which have been denied us up to now by the Association.
§ Mr. Darling
Yes. It is very difficult to have consultations with people who do not want to consult, and this is what has happened. Time and time again the Board of Trade has said, "This is what is proposed. Please come along and discuss it." The hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin) quoted a letter of 9th June in which we said, "If there are any further points, come along and discuss them". Time and time again difficulties were raised.
271 In a way I do not blame the industry. I can understand that this is its point of view. It does not want anything to do with this Order, so why should it come and consult. As I say, from its point of view it is understandable.
I do not want to go over the whole story. I have the facts here. I would prefer this Order, which is extending the levy to the manufacturers of built-in units, to come into operation in a much more friendly atmosphere than has been created by the debate.
I refer now to the points raised by my hon. Friend the Member for Darlington (Mr. Ted Fletcher). The Amalgamated Society of Woodworkers and the Amalgamated Society of Woodcutting Machinists were in effect in the working party from the beginning, because they are members of the trade union federation which is represented on the Furniture Development Council, and they were informed all the way through of what was going on. In addition, because we had heard that the Amalgamated Society of Woodworkers was not quite happy about the way things were going, we asked it to come along and we would explain things. We understand that no representations have been made by the Amalgamated Society of Woodcutting Machinists against the Order. Consultation has taken place with the A.S.W. We had a meeting on 9th June.
I pay tribute to the joinery industry for the way it has progressed and developed in the production of built-in furniture, or built-in units as they have been called, but the point which has been raised by one or two hon. Members is that this is no reason why this part of furniture production should be left out of the levy. We are quite confident that when this rather difficult discussion is over the Order will go through and the levy will, as the industry would say, be imposed on it, but it is a very modest contribution that it will be making. It will have its opportunities, as a constituent partner of the Furniture Development Council, to help to sort out and perhaps solve many of the problems we would have wished to discuss with 272 it ever since February of this year. I have made it plain that we have attempted time and time again to discuss the problems which the industry wished to raise.
One issue which has been raised is that the Furniture Development Council is so short of funds that it wants to extend its levy arrangements. This is not true. The F.D.C. is not seriously short of funds, but if its ambitious programme of research and development is to go on there will have to be additional funds, because the previous Order limits its income to £75,000 a year. It cannot raise more than that. As I am sure the hon. Member for Darlington will agree, leaving out the question about the woodwork manufacturers coming in, this sum of money is probably now much too small for the purpose that it has in mind.
We offered consultation all the way through. This Order is urgent because of the time factor. When the present Order ceases to operate, a new Order must come into operation. We think that it is very fair and the woodwork manufacturers concerned with unit furniture will see the necessity of it and play their part in helping to extend the research and other services which the Development Council can provide not only for the traditional furniture makers but the manufacturers of built-in units as well.
§ Mr. Patrick Jenkin
Before the right hon. Gentleman sits down, will he accept that we on this side would sincerely join with him in hoping that whatever may be the outcome of the Order, all those concerned with working it will co-operate. Although there may have been ruffled feathers on the part of the industry, will the right hon. Gentleman give an assurance that he and his Department will do their utmost to operate it in the interests of the industry so that everything may go as smoothly as it can.
§ Question put and agreed to.
That the Furniture Industry Development Council (Amendment No. 3) Order 1967, a draft of which was laid before this House on 5th July, 'be approved.