HC Deb 16 October 1968 vol 770 cc533-43

Lords Amendment No. 48: In page 55, line 20, leave out" and places outside."

Read a Second time.

11.0 p.m.

The Joint Parliamentary Secretary to the Ministry of Transport (Mr. Bob Brown)

I beg to move, That this House doth disagree with the Lords in the said Amendment.

Mr. Deputy Speaker

I thought that it was the intention to discuss with this Amendment Amendment No. 49, in page 55, line 24, leave out from "within" to "their" in line 25, Amendment No. 50, in page 55, line 30, leave out "cease" and insert "continue", Amendment No. 51, in page 55, line 30, at end insert "except insofar as they are affected by section 31 of this Act ", Amendment No. 52, in page 55, line 41, leave out "to and from ", and Amendment No. 53, in page 56, line 9, leave out "to and from". Would that be for the convenience of the House?

Mr. Brown

Yes. Clause 36 is to provide municipal transport authorities with general contract carriage powers, and this was introduced by the Government on Report stage in this House in place of a back-bench Amendment moved by the hon. Member for Central Ayrshire (Mr. A. Manuel) in Committee.

The House of Lords has not interfered with subsection (1), which provides the powers wholly within the authority's district; it has only removed the power to run outside the district.

The reasons which the Opposition gave for these Amendments in the Lords Committee were that municipal competition in the contract field would have an adverse effect on the private sector, especially on smaller operators; that private operators are more efficient than municipalities in this field; that municipal undertakings would run contract carriages at a loss, charging the deficit to the rates, so as to attract business from private firms; and that in order to man contract carriages municipal undertakings would draw off drivers from regular stage buses.

The Opposition Amendments mean that local authorities could undertake no contract carriage operation whatever outside their district, without seeking local act power, and the Government see no case at all for this limitation. It is considered reasonable that local authorities should now be able to engage in this sort of operation in the same way as non-municipal operators. It is perhaps surprising that either side of the House should question this reasonable extension of a trading activity which is already being carried on, and by responsible elected local authorities.

However, the Government recognised that where this trading activity is extended outside the local authority's district, it would be reasonable to provide the safeguards included in the Clause. In the first place, the powers to operate to and from the district—or in a limited way wholly outside it—cannot be assumed until the Minister is satisfied, by the drill provided in subsections (3) and (4), as to the local authority's general policy of co-operation with its neighbouring operators. Secondly, once the powers are assumed, the provisions in subsection (5) secure against unfair undercutting by local authorities in their contract carriage charges, inside as well as outside their district.

Contract carriage operations are profitable because the operator is able to ensure, before undertaking to provide a service, that the revenue will cover his costs and yield a reasonable profit, unlike the ordinary stage and express services which—under the terms of their road service licences—must be operated to fixed timetables regardless of the amount of passenger traffic at any particular time. For this reason, the field is a highly competitive one. But there is no reason why it should not be a freely competitive one, on fair terms.

Subsection (5) secures against unfair undercutting by local authorities. If, as the Opposition maintain, the private bus operators are more efficient in this field than the local authority undertakings, then they should have nothing to fear from municipal competition.

With regard to the point that a municipal undertaking's stage services might suffer because of drivers being withdrawn to man contract carriages, surely the Opposition are overlooking that, because stage services have to be run according to prescribed timetables, the traffic commissioners are able to investigate any reason for failure to provide a proper service, and the local authority could quickly be taken to task on this score.

Much private party work is, in any case, run at off-peak periods, in evening or weekend excursions. The municipal undertakings have stressed that what they want is the opportunity to use the vehicles and staff who are otherwise idle at off-peak periods, and that if they can balance their stage operations with a fair share of more remunerative work, that will be for the benefit of their undertakings, and I would stress for the benefit of their passengers as a whole.

Mr. Michael Heseltine

Once again, I hope that these Amendments will not be rejected. This principle was introduced very late on Report, before any proper consultation with the interested parties. What little consultation there had been provoked a great deal of discouragement for the Ministry and I am surprised that they persisted in the Amendments. However, I am delighted that their Lordships have given us one more chance not to persist along these lines.

There is probably a doctrinal difference between us here. I and many other hon. Members just do not believe that local authorities should have the opportunity to run excursion tours or contract carriage services for any wide range of activities which suits them. There are many activities suited to the public domain and many others which are best left outside it. Excursion tours overseas or anywhere in this country should not be encouraged in the public sector. I am aware of no evidence of a demand for extra supplies of these services in the public sector.

This part of the holiday and travel industry is having some difficulties at the moment, yet it is suggested that the municipal authorities should invade this field with the safeguards outlined by the Parliamentary Secretary. I know of no reason why this should happen, and I noticed that the Parliamentary Secretary gave no hope of extra profits along the lines described in an earlier debate. I suspect that there will be none. As he said, this is a competitive business. I suspect that the extra buses will certainly be used, and that extra wages paid, but that the result will be losses and not a surplus. This should not be encouraged, particularly at this moment in the economic situation.

The alarming thing about this is the complete misunderstanding by the Ministry of the industry for which they were legislating. Nothing is more revealing than the provision that, before giving permission to a local authority to conduct this sort of exercise, the Minister must get from it a statement showing how it has tried to co-ordinate the existing activities of those already providing these services. I find it extraordinary that, in a competitive area, with small people seeking all the business they can get, it should be suggested that the local authorities should try to parcel out the business between themselves and the private sector before submitting a statement seeking the Minister's permission. Yet this is written into the legislation. No one who understood this business could have written this legislation.

What it amounts to is that, having had the original idea of this extension of the public sector submitted by the hon. Member for Central Ayrshire (Mr. Manuel) this "phoney" safeguard was built into the legislation to satisfy the trade interests, but it is a nonsense in any commercial behaviour, a fact of which the industry is, I am sure, well aware.

The Parliamentary Secretary made play with the fact that there are commercial safeguards, that statements must be produced to show how the local authorities are doing out of this sort of exercise, but there could be a delay of 23 months before a financial statement is prepared by the local authorities to show the Minister whether or not they are making a profit.

If local authorities have been undercutting charges in those 23 months and if they have been able to attract a great deal of business by behaving in an uncommercial way throughout that period, by that time it will be too late for the private sector, who will have lost all that business and who cannot be expected to carry that loss over the 23 months and then to start in business again. Although safeguards are written into legislation from the point of view of commercial people involved, they are not worth having.

I ask that we should resist any unnecessary extension of monopoly trading. Not one argument has been produced to show that there is a market for the municipalities to trade at a profit. There is reason to fear that they would make a loss. I have heard no argument why the House should not agree with their Lordships in this matter.

Mr. Manuel

The reason I moved an Amendment in Committee in connection with contract carriage operations was that I received representations from the Municipal Passenger Transport Authorities' Association. Anyone who examines the present position of contract carriage operations will agree that it is illogical. Some of our major local authorities which run transport undertakings have powers to enable them to conduct these operations within their own local authority areas. Others have powers which allow them to exceed that somewhat on a certain mileage basis. Others have much wider powers. Surely all will agree that there should be uniformity in the freedom allowed local authorities for contract carriage operations.

I am constantly amazed at the reception which this suggestion receives from hon. Members opposite. When a public undertaking seeks to increase fares, there is an outcry from hon. Members opposite who raise a host of objections. But do they appreciate that the major bus undertakings, especially in the large conurbations, need a large number of buses operating at peak periods and that, outside the peak periods, many hundreds of these buses are in the garages not turning a wheel? This provision would allow an authority to do other types of contract carriage operation, which means hiring buses for football matches, dances and other activities.

Why should local authorities not have that freedom. In many instances, where they made a success of contract carriage operations, would not that avoid an increase in fares? That is one of the salient points made by the Municipal Passenger Transport Authorities Association. They wrote to me yesterday asking me to try to rescue them from the situation which their Lordships had created by turning down the very sensible Amendment which was accepted in Committee.

I hope that the House will be sensible and agree that local authorities should be treated equally throughout the country.

11.15 p.m.

Mr. Bob Brown

I do not want to detain the House—

Mr. Deputy Speaker

If the hon. Member wishes to speak again he needs the leave of the House.

Mr. Brown

May I have the leave of the House to reply?

It is clear that there was some confusion in earlier debates about what contract carriage operation is, and the hon. Member for Tavistock (Mr. Michael Heseltine) showed this confusion again in this debate, because he said that local authorities should not embark on running excursions. Contract carriage operation is where a vehicle is hired as a whole and no fares are charged to passengers—for example, a vehicle is hired by a local education authority to carry school children—or is used for private party work on which separate fares are charged but whose journeys are not advertised, and whose passengers are not carried regularly. It does not cover public excursions and tours. These are subject to licensing by the traffic commissioners, whether provided by municipal or non-municipal operators.

Question put, That this House doth disagree with the Lords in the said Amendment:—

The House divided: Ayes 250, Noes 198.

Division No. 296.] AYES [11.14 p.m.
Abse, Leo Brown, R. W. (Shoreditch & F'bury) Dunwoody, Dr. John (F'th & C'b'e)
Albu, Austen Buchan, Norman Eadie, Alex
Allaun, Frank (Salford, E.) Buchanan, Richard (G'gow, Sp'burn) Edwards, William (Merioneth)
Alldritt, Walter Butler, Mrs. Joyce (Wood Green) Ellis, John
Anderson, Donald Callaghan, Rt. Hn. James Ennals, David
Archer, Peter Cant, R. B. Ensor, David
Armstrong, Ernest Carmichael, Nell Evans, Fred (Caerphilly)
Ashley, Jack Carter-Jones, Lewis Evans, Gwynfor (C'marthen)
Atkins, Ronald (Preston, N.) Coe, Denis Faulds, Andrew
Atkinson, Norman (Tottenham) Coleman, Donald Fernyhough, E.
Bagier, Gordon A. T. Concannon, J. D. Finch, Harold
Barnes, Michael Conlan, Bernard Fletcher, Raymond (Ilkeston)
Baxter, William Corbet, Mrs. Freda Foot, Rt. Hn. Sir Dingle (Ipswich)
Beaney, Alan Crawshaw, Richard Foot, Michael (Ebbw Vale)
Bence, Cyril Crossman, Rt. Hn. Richard Ford, Ben
Benn, Rt. Hn. Anthony Wedgwood Cullen, Mrs. Alice Forrester, John
Bennett, James (G'gow, Bridgeton) Davidson, Arthur (Accrington) Fowler, Gerry
Bidwell, Sydney Davies, Ednyfed Hudson (Conway) Fraser, John (Norwood)
Bishop, E. S. Davies, G. Elfed (Rhondda, E.) Freeson, Reginald
Blackburn, F. Davies, Dr. Ernest (Stretford) Galpern, Sir Myer
Boardman, H. (Leigh) Davies, Harold (Leek) Gardner, Tony
Booth, Albert Davies, Ifor (Gower) Garrett, W. E.
Boston, Terence de Freitas, Rt. Hn. Sir Geoffrey Ginsburg, David
Bottomley, Rt. Hn. Arthur Dell, Edmund Gordon Walker, Rt. Hn. P. C.
Boyden, James Dempsey, James Gourlay, Harry
Braddock, Mrs. E. M. Dewar, Donald Gray, Dr. Hugh (Yarmouth)
Bradley, Tom Diamond, Rt. Hn. John Gregory, Arnold
Bray, Dr. Jeremy Dickens, James Grey, Charles (Durham)
Brooks, Edwin Dobson, Ray Griffiths, Eddie (Brightside)
Broughton, Dr. A. D. D. Doig, Peter Gunter, Rt. Hn. R. J.
Brown, Hugh D. (G'gow, Provan) Dunn, James A. Hamilton, James (Bothwell)
Brown,Bob(N 'c'tle-upon-Tyne, W.) Dunwoody, Mrs. Gwyneth (Exeter) Hamling, William
Harper, Joseph McGuire, Michael Probert, Arthur
Harrison, Walter (Wakefield) McKay, Mrs. Margaret Rees, Merlyn
Hart, Rt. Hn. Judith Mackenzie, Gregor (Ruthergien) Reynolds, Rt. Hn. G. W.
Hazell, Bert Mackie, John Roberts, Albert (Normanton)
Healey, Rt. Hn. Denis Mackintosh, John P. Roberts, Gwilym (Bedfordshire, S.)
Heffer, Eric S. Maclennan, Robert Robinson, W. O. J. (Walth'stow, E.)
Herbison, Rt. Hn. Margaret McMillan, Tom (Glasgow, C.) Rodgers, William (Stockton)
Milton, W. S. McNamara, J. Kevin Ross, Rt. Hn. William
Hobden, Dennis (Brighton, K'town) MacPherson, Malcolm Rowlands, E. (Cardiff, N.)
Hooley, Frank Mahon, Peter (Preston, S.) Shaw, Arnold (Ilford, S.)
Houghton, Rt. Hn. Douglas Mahon, Simon (Bootle) Sheldon, Robert
Howarth, Harry (Wellingborough) Mallalieu, E. L. (Brigg) Short,Rt.Hn.Edward(N'c'tle-u-Tyne)
Howarth, Robert (Bolton, E.) Manuel, Archie Silkin, Rt. Hn. John (Deptford)
Howie, W. Mapp, Charles Silverman, Julius
Hoy, James Marks, Kenneth Slater, Joseph
Hughes, Rt. Hn. Cledwyn (Anglesey) Marquand, David Small, William
Hughes, Emrys (Ayrshire, S.) Marsh, Rt. Hn. Richard Spriggs, Leslie
Hughes, Roy (Newport) Mason, Rt. Hn. Roy Steele, Thomas (Dunbartonshire, W.)
Hunter, Adam Mayhew, Christopher Stonehouse, Rt. Hn. John
Hynd, John Mendelson, J. J. Strauss, Rt. Hn. G. R.
Jackson, Peter M. (High Peak) Millan, Bruce Swain, Thomas
Janner, Sir Barnett Mitchell, R. C. (S'th'pton, Test) Swingler, Stephen
Jenkins, Rt. Hn. Roy (Stechford) Moonman, Eric Taverne, Dick
Johnson, Carol (Lewisham, S.) Morgan, Elystan (Cardiganshire) Thomas, Rt. Hn. George
Johnson, James (K'ston-on-Hull, W.) Morris, Charles R. (Openshaw) Thornton, Ernest
Jones, Dan (Burnley) Morris, John (Aberavon) Tinn, James
Jones,Rt.Hn.SirElwyn(W.Ham,S.) Moyle, Roland Urwin, T. W.
Jones, J. Idwal (Wrexham) Mulley, Rt. Hn. Frederick Wainwright, Edwin (Dearne Valley)
Jones, T. Alec (Rhondda, West) Neal, Harold Walker, Harold (Doncaster)
Judd, Frank Newens, Stan Watkins, David (Consett)
Kelley, Richard Oakes, Gordon Watkins, Tudor (Brecon & Radnor)
Kenyon, Clifford Ogden, Eric Weitzman, David
Kerr, Mrs. Anne (R'ter & Chatham) O'Malley, Brian Wellbeloved, James
Kerr, Dr. David (W'worth, Central) Oram, Albert E. Wells, William (Walsall, N.)
Kerr, Russell (Feltham) Orbach, Maurice Whitaker, Ben
Lawson, George Orme, Stanley Whitlock, William
Leadbitter, Ted Oswald, Thomas Wilkins, W. A.
Lee, Rt. Hn. Frederick (Newton) Owen, Dr. David (Plymouth, S'tn) Willey, Rt. Hn. Frederick
Lestor, Miss Joan Owen, Will (Morpeth) Williams, Alan (Swansea, W.)
Lever, Harold (Cheetham) Page, Derek (King's Lynn) Williams, Clifford (Abertillery)
Lever, L. M. (Ardwick) Paget, R. T. Williams, W. T. (Warrington)
Lewis, Arthur (W. Ham, N.) Palmer, Arthur Willis, Rt. Hn. George
Lipton, Marcus Pannell, Rt. Hn. Charles Wilson, William (Coventry, S.)
Lomas Kenneth Park, Trevor Winnick, David
Loughlin, Charles Parker, John (Dagenham) Woodburn, Rt. Hn. A.
Lyon, Alexander W. (York) Parkyn, Brian (Bedford) Woof, Robert
Lyons, Edward (Bradford, E.) Pavitt, Laurence Wyatt, Woodrow
Mabon, Dr. J. Dickson Peart, Rt. Hn. Fred Yates, Victor
McBride, Neil Pentland, Norman
McCann, John Perry, George H. (Nottingham, S.) TELLERS FOR THE AYES:
MacColl, James Price, Christopher (Perry Barr) Mr. Ernest Perry and
MacDermot, Niall Price, Thomas (Westhoughton) Mr. Ioan L. Evans.
Macdonald, A. H. Price, William (Rugby)
NOES
Alison, Michael (Barkston Ash) Campbell, Gordon (Moray & Nairn) Fraser,Rt.Hn.Hugh(St'fford & Stone)
Allason, James (Hemel Hempstead) Carlisle, Mark Galbraith, Hn. T. G.
Astor, John Channon, H. P. G. Gibson-Watt, David
Atkins, Humphrey (M't'n & M'd'n) Chichester-Clark, R. Giles, Rear-Adm. Morgan
Awdry, Daniel Clegg, Walter Gilmour, Ian (Norfolk, C.)
Baker, Kenneth (Acton) Cooke, Robert Gilmour, Sir John (Fife, E.)
Baker, W. H. K. (Banff) Cooper-Key, Sir Neill Glyn, Sir Richard
Balniel, Lord Cordle, John Godber, Rt. Hn. J. B.
Barber, Rt. Hn. Anthony Corfield, F. V. Goodhart, Philip
Beamish, Col. Sir Tufton Costain, A. P. Goodhew, Victor
Bell, Ronald Craddock, Sir Beresford (Spelthorne) Gower, Raymond
Berry, Hn. Anthony Crouch, David Grant, Anthony
Bessell Peter Crowder, F. P. Grant-Ferris, R.
Biffen, John
Birch, Rt. Hn. Nigel Dalkeith, Earl of Grieve, Percy
Black, Sir Cyril Dance, James Gurden, Harold
Blaker, peter Davidson, James(Aberdeenshire, w.) Hall, John (Wycombe)
Boardman, Tom (Leicester, S. W.) d'Avigdor-Goldsmid, Sir Henry Hall Davies, A. G. F.
Bossom, Sir Clive Dean, Paul (Somerset, N.) Hamilton, Michael (Salisbury)
Boyle-Carpenter, Rt. Hn. John Deedes, Rt. Hn. W. F. (Ashford) Harrison, Col. Sir Harwood (Eye)
Boyle, Rt. Hn. Sir Edward Doughty, Charles Harvey, Sir Arthur Vere
Braine, Bernard Eden, Sir John Harvie Anderson, Miss
Brinton, Sir Tatton Elliot, Capt. Walter (Carshalton) Hastings, Stephen
Bromley-Davenport,Lt.-Col.Sir Walter Elliott, R.W.(N'c'tle-upon-Tyne,N.) Hawkins, Paul
Bruce-Gardyne, J. Farr, John Hay, John
Bryan, Paul Fisher, Nigel Heald, Rt. Hn. Sir Lionel
Buchanan-Smith, Alick(Angus,N&M) Fletcher-Cooke, Charles Heath, Rt. Hn. Edward
Burden, F. A. Fortescue, Tim Heseltine, Michael
Campbell, B. (Oldham, W.) Foster, Sir John Higgins, Terence L.
Hill, J. E. B. Montgomery, Fergus Smith, Dudley (W'wick & L'mington)
Holland, Philip More, Jasper Smith, John (London & W'minster)
Hooson, Emlyn Morgan, Geraint (Denbigh) Speed, Keith
Hordern, Peter Murton, Oscar Stainton, Keith
Hornby, Richard Neave, Airey Stoddart-Scott Col. Sir M. (Ripon)
Howell, David (Guildford) Nicholls, Sir Harmar Summers, Sir Spencer
Hunt, John Noble, Rt. Hn. Michael Tapsell, Peter
Hutchison, Michael Clark Nott, John Taylor,Edward M.(G'gow,Cathcart)
Iremonger, T. L. Onslow, Cranley Taylor, Frank (Moss Side)
Irvine, Bryant Codman (Rye) Orr, Capt. L. P. S. Teeling, Sir William
Jenkin, Patrick (Woodford) Orr-Ewing, Sir Ian Temple, John M.
Jones, Arthur (Northants, S.) Osborn, John (Hallam) Thatcher, Mrs. Margaret
Jopling, Michael Page, Graham (Crosby) Thorpe, Rt. Hn. Jeremy
Kerby, Capt. Henry Page, John (Harrow, W.) Tilney, John
Kershaw, Anthony Pearson, Sir Frank (Clitheroe) Turton, Rt. Hn. R. H.
Kimball, Marcus Percival, Ian van Straubenzee, W. R.
Knight, Mrs. Jill Peyton, John Vaughan-Morgan, Rt. Hn. Sir John
Lambton, Viscount Pink, R. Bonner Waddington, David
Lancaster, Col. C. G. Pounder, Rafton Walker, Peter (Worcester)
Lane, David Powell, Rt. Hn. J. Enoch Walker-Smith, Rt. Hn. Sir Derek
Legge-Bourke, Sir Hairy Price, David (Eastleigh) Wall, Patrick
Lewis, Kenneth (Rutland) Prior, J. M. L. Walters, Dennis
Longden, Gilbert Pym, Francis Ward, Dame Irene
Loveys, W. H. Quennell, Miss J. M. Weatherill, Bernard
Lubbock, Eric Rees-Davies, W. R. Webster, David
MacArthur, Ian Renton, Rt. Hn. Sir David Wells, John (Maidstone)
Macleod, Rt. Hn. Iain Rhys Williams, Sir Brandon Whitelaw, Rt. Hn. William
Maddan, Martin Ridley, Hn. Nicholas Williams, Donald (Dudley)
Maginnis, John E. Ridsdale, Julian Wilson, Geoffrey (Truro)
Marples, Rt Hn, Ernest Rippon, Rt. Hn. Geoffrey Winstanley, Dr. M. P.
Marten, Neil Rodgers, Sir John (Sevenoaks) Wood, Rt. Hn. Richard
Maude, Angus Rossi, Hugh (Hornsey) Woodnutt, Mark
Mawby, Ray Royle, Anthony Wright, Esmond
Maxwell-Hyslop, R. J. Russell, Sir Ronald Wylie, N. R.
Maydon, Lt.-Cmdr. S. L. C. Scott, Nicholas Younger, Kn. George
Mills, Peter (Torrington) Sharpies, Richard
Mills, Stratum (Belfast, N.) Shaw, Michael (Sc'b'gh & Whitby) TELLERS FOR THE NOES:
Miscampbell, Norman Silvester, Frederick Mr. Reginald Eyre, and
Monro, Hector Sinclair, Sir George Mr. Timothy Kitson.

Subsequent Lords Amendments disagreed to.

Subsequent Lords Amendments agreed to.

Further consideration of the Lords Amendments adjourned.—[Mr. Marsh.]

Lords Amendments to be further con-considered Tomorrow.