New Clause (Hansard, 24 May 1968)

§ Sir C. Black
I beg to move, That the Clause be read a Second time.
This is a simple point which can be explained in a few words. Under the Bill, if the Board decides to give assistance to a business, the terms and conditions of it are subject to approval by the Minister and the Treasury. That is as it should be. But there is no provision to cover the situation in which a company seeks the aid of the Board and the Board comes to the conclusion that it is not a case in which assistance should be given. No appeal is available to the applicant in those circumstances.
It is important, not only that justice should be done, but that it should be seen to be done. One knows from one's experience in public life that when it comes to making or refusing grant there is often local dissatisfaction among people not fortunate enough to get a grant, even though the circumstances may justify the Board in refusing a grant. Therefore, it would be reasonable for an aggrieved person to have a right of appeal to the Secretary of State. After all, the 1134 right hon. Gentleman's approval is required when a grant is made. It is not unreasonable that there should be a right of appeal when the Board refuses a grant.

§ Mr. Maclennan
The new Clause would introduce a further condition which I believe to be quite outside the terms of the parent Act. The Highlands and Islands Development Board was set up as an independent body, and although it is true that some of its activities, clearly defined in the Act, require to be approved by the Secretary of State and, in some cases, by the Treasury, the Board itself, has been given the responsibility for the day-to-day running of its affairs. In my view, this position must be maintained if the Board is to do its job effectively.
It seems to me that to accept the new Clause would not only be contrary to Parliament's intentions in passing the 1965 Act but would constitute a quite burdensome condition on the working of the grants and loans schemes if every decision of the Board were to be open to the scrutiny of the Secretary of State. The Board requires this capacity to make these judgments on its own, and it would be a work of supererogation to give possible applicants this right of appeal. Therefore, I ask the House to reject the new Clause.

§ Sir Knox Cunningham (Antrim, South)
I support the new Clause, and I hope that the Minister of State for Scotland will also be favourably disposed towards it. We have here a Board set up out of public funds, and it would be of the very greatest assistance to a company or other body or a person who had been refused a grant to be able to go to the Secretary of State. That would not mean that every case would be appealed to him, but some cases would. It is proper, as the public are spending the money, that there should be some right of appeal if the Board refuses to make a grant. This would in no way affect the Board's working, but would add a safeguard that I hope the House and the Minister will agree would be useful.

§ Mr. Russell Johnston
I hope that the Minister will do no such thing. The implications of such an Amendment as this were the Minister to take it seriously, are very considerable. The Secretary of 1135 State is heavily burdened already without having to consider each and every protest and appeal against the non-award of a grant. The hon. Member for Wimbledon (Sir C. Black) said that many of the Board's powers are already subject to the Secretary of State and to the Treasury, but these are basically reserve powers, and are necessary. There is a world of difference between a reserve power that is not often exercised and the power to use the Secretary of State as an appeal court—

§ Mr. Peter Mahon (Preston, South)
There appears to be a very genuine cleavage of opinion among hon. Gentlemen opposite. One view is that there should be a right of appeal and the other it that there should be no such right. Does not the hon. Member for Inverness (Mr. Russell Johnston) think that it would be anti-democratic if this provision were not put in the Bill?

§ Mr. Johnston
I am not quite sure that I follow the hon. Gentleman. There is certainly a cleavage of opinion between this bench and other benches, but I do not understand the hon. Gentleman's point about the Bill being otherwise non-democratic.

§ Mr. Mahon
Does not the hon. Gentleman feel that where an aggrieved party thinks that an injustice has been done, there should be a right of appeal?

§ Mr. Johnston
I see that point perfectly clearly, but if we were to set up a mechanism making each and every individual case subject to appeal, it would mean a very long and attenuated process. As the hon. Member may know, and as the Minister and the hon. Gentleman the Member for Caithness and Sutherland (Mr. Maclennon) certainly know, one of the main objects of setting up the Board was to get quick and definite decisions. We knew that mistakes would be made, and that risks would be taken that would prove to have been unjustified. This long drawn out mechanism would not help the Board nor, at the end of the day, would it make very much difference.

§ Dr. Dickson Mabon
My hon. Friend the Member for Preston, South (Mr. Peter Mahon) touched on a matter of great delicacy when he interrupted the 1136 hon. Member for Inverness (Mr. Russell Johnston), who has been a great friend of mine for a long time. The only time when we fell out publicly—and he was wrong, of course—was on this very issue. It is not a question of an absolute position —there is a qualified position—and in explaining it not only will I seek to bury an old quarrel but, at the same time, seek to satisfy the movers of the new Clause, which I certainly do not support.
The Board is an independent body. It is on the same footing as B.O.T.A.C, the advisory committee to the President of the Board of Trade. The decisions of B.O.T.A.C. are not appealable. The President of the Board of Trade may or may not take its advice to give a grant or a loan, but he cannot give a loan in the face of the Advisory Committee's recommendation to him. In other words, although B.O.T.A.C. is an advisory body it is a very significant independent instrument of Government. That means that it can enjoy the confidence of its applicants. It can ask them for very detailed confidential information which might be prejudicial to their interests if their business rivals were to learn of it. It would deter people from asking the Board for assistance if they thought that their confidences were in any way to be breached.
That is not quite the position with regard to right of appeal, because there the person who has imparted his confidence is taking a chance on his appeal. It could be a private appeal, I admit, but that might not suffice, as the appeal might involve other interests. What we have decided, and we have been acting on the decision for some time, is that the Board is an independent body, freely able to decide these matters without any appeal to the Secretary of State, although only up to a certain limit. If larger sums of public money are involved, whether the assistance to be given is grant, loan or both, the taxpayer is very clearly concerned and the advice of the Department and of the Secretary of State is sought. The Secretary of State then gets to know everything about the case, and the matter is settled.
The hon. Member for Inverness and I fell out over an issue that did not involve that aspect but related to an international treaty which is presently being debated. The Board has to conform to whatever 1137 treaties Great Britain signs, and it has to conform to the requirement, too, that where a great deal of money is involved the Secretary of State can be consulted and, in some cases, even the Treasury.
But these are clearly defined activities. In general, we regard the Board as an independent body able to administer the day-to-day running of its own affairs, its final responsibility being in its annual report to the Secretary of State, which is debated in the House. That is not to say that we do not get letters from individual hon. Members on behalf of aggrieved parties—not only those denied loans but those who have objected to loans and grants being given to others. The Secretary of State makes inquiries, and replies, I think fully and courteously, to the hon. Members concerned. But he does not seek to breach the independence of the Board in relation to these matters.
The Board has its own management division. It is building up consultancy advice from businessmen outside in the confidentiality of its own confines. It seeks to do its best in an independent and fair way to protect the taxpayer and to promote the prosperity of the Highlands. I therefore ask the hon. Member not to press the new Clause.