MANUFACTURE, REPAIR AND SUPPLY

HC Deb 17 October 1968 vol 770 cc592-639

Lords Amendment, No. 56: In page 68, line 19, leave out Clause 48.

3.50 p.m.

The Minister of Transport (Mr. Richard Marsh)

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

Mr. Speaker, it might be for the convenience of the House if, with this Amendment, we were to take Lords Amendments Nos. 59, 60, 198 to 200 and 254.

Mr. Speaker

If the House agrees, so be it.

Mr. Marsh

Of all the very many debates which have taken place on the Bill, this one is more concerned with a fundamental disagreement in principle than any other that we have discussed so far.

On this side of the House, our position is clear. The Labour Party's election Manifestoes of 1964 and 1966 both said clearly that we would remove statutory restrictions to diversify from the nationalised industries. The position of right hon. and hon. Gentlemen opposite is equally clear. They fought us on this issue in the past, and it may be that they will do so in the future. They stand firmly in favour of legal restrictions on the commercial freedom of the publicly-owned industries which neither they nor those who pay their election expenses would tolerate in the private sector of industry.

Their policy on this issue and on this Amendment is clear. They take the line that there should be free competition, but they take the precaution of making sure, first, that the taxpayers' industries are hamstrung before they start. I do not believe that it is in anyone's interests to treat the nationalised industries as if they were the arm of social policy rather than of industrial policy, and that is why, in the Bill, we aim to take the burden of unremunerative railway services off the back of the railway industry. The purpose of this part of the Bill is to enable particularly the railway industry to be a viable commercial undertaking in which men and management can find security and pride. In other words, we want industries which stand on their own feet.

These industries have the managerial and technical skills to do this, but they cannot be expected to do it, nor has anyone any right to complain about their financial performance, if the public sector alone in industry is shackled to satisfy outdated doctrinal prejudices of right hon. and hon. Gentlemen opposite.

The powers which we are debating on this Clause are by no means unlimited. The Clause relates the wider powers of manufacture to the present possession of materials, facilities or skills in connection with some existing activity. Under the Bill as it emerged from the Commons, such an authority is not permitted to engage in a new activity unless it is satisfied that it can do so without detriment to its main duties. Proposals as to the manner in which the powers are to be used must be submitted to the Minister for approval. It does not stop there, because the Minister must publish any proposals that he approves. He must send copies of the proposals to the Confederation of British Industry and to the Trades Union Congress. He will be able to direct an authority to discontinue any activity, and he can direct an authority to disclose in its annual report particulars of any of the activities carried on.

A great deal will depend on the way in which these checks and safeguards are administered. The Government intend that they shall be used in a way which will enable the nationalised transport authorities to employ their skills and resources more fully than is possible at present. When an authority engages in activities under these new powers, it will be under a specific duty to act as if it were a company engaged in a commercial enterprise. That duty was inserted in the Clause in Committee, and it will still apply if the Clause is reinstated.

Sir Harmer Nicholls (Peterborough)

Where will they raise their money?

Mr. Marsh

The hon. Member for Peterborough (Sir Harmar Nicholls) asks where they will raise their money. Given the new financial structures, they will raise their money by commercial activities and by charging rates which will produce a return.

Mr. Michael Heseltine (Tavistock)

Do I understand that the borrowing powers included in the Bill and available to the nationalised boards may not be used for the purposes which the right hon. Gentleman now describes?

Mr. Marsh

The hon. Member for Tavistock (Mr. Michael Heseltine) makes a debating point. These industries will be required to submit capital investment programmes. They will be provided with financial obligations. There will be strict control, rights of appeal and rights of challenge within the Bill. The hon. Member for Peterborough puts his finger on the whole point. He asks where they will get the money. With the greatest respect, he cannot raise that argument and then say that the industry shall not be allowed to use the resources which it has to their fullest capacity.

Mr. Peter Bessell (Bodmin)

This is an important point on which some clarification would be helpful. The hon. Member for Tavistock (Mr. Michael Heseltine) asked whether the boards would be able to use their borrowing powers to finance the activities provided for under Clause 48. Is it the fact that they will not use those borrowing powers for that purpose? This is very important.

Mr. Marsh

That is the point to which I am coming. It is provided in the Bill that they are not allowed to engage in activities outside the areas in which they are already involved and have skills unless they can show a straight commercial return. They will be able to borrow in the normal way, as an industry does, to undertake such use of their normal skills.

The key point in this is that we are providing for a legal obligation to those industries to act commercially. Even with this Amendment removed, we are restricting them to an extent to which no private company is restricted. It ill becomes right hon. and hon. Gentlemen opposite to talk about competition and then attempt to cripple the industry.

Mr. Raymond Gower (Barry)

In the middle of that statement, the Minister said something about borrowing in the ordinary way. Can he clarify that? Does he mean that, like a company, they will try to borrow on the market?

Mr. Marsh

That raises an entirely different point which I would, naturally, like to discuss at length. As the hon. Gentleman will be aware, there has been a development recently in the borrowing powers of the gas industry, where a provision has been made for the industry to borrow on the open market. It was attacked by hon. Gentlemen opposite. Their attitude is a classic example of wanting it all ways.

Perhaps I might continue with what I was saying about this Amendment without the constant interruptions designed solely to divert attention from the pigheaded nature of hon. Gentlemen opposite. If we can restore the Clause, it will be substantially the same as Clause 48 was when it was before the other place. There has been one change made in accordance with a statement in the Lords Committee by my noble Friend, Lord Shepherd. In the Clause as it then stood, subsection (4) required the boards to submit proposals to the Minister from time to time as to the manner in which they intended to use the new powers of manufacture and repair in subsection (2). This obligation did not apply to activities under subsection (6), concerned with the sale of petrol, etc., at car parks, and shopkeeping activities by British Waterways. The Opposition sought to apply subsection (4) to activities under subsection (6), and my noble Friend said that the Government accepted the principle.

We have taken that into account in the version of the Clause that we are now proposing should be reinstated. The former subsection (6) will be omitted, and its substance incorporated in subsection (2). As a result, subsection (2) will now contain the entire range of new powers in the Clause, and all the safeguards in the Clause will apply to all the powers. There is also a number of small Amendments to other parts of the Bill, consequential to the restoration of former Clause 48.

4.0 p.m.

The issue is a very clear one. In all these industries, there is a vast investment of public money. In all of these industries there are bound to be from time to time surplus capacities and ways in which they could use their skills and experience to develop and become more profitable. What we are really asking—this is the sole point at issue—is whether the publicly-owned industries alone should be prevented from using the facilities, skill and capital investment which they have for commercial purposes for the benefit of their shareholders in the form of the State?

The Luddite mentality of hon. Gentlement opposite is incredible. How anyone in present circumstances could actively campaign for legislation designed specifically to prevent the full use of men, machines and capital in a large slice of industry is beyond comprehension. There is no argument for it other than the extraordinary intention to stick firmly to the ark of the covenant—that public industry is bad and has to be shackled, and that private industry has to be given its head.

We on this side of the House ask for no special privileges for the public sector. We are prepared to accept that because of their size in many cases and because of the very nature of the organisations there is a need to ensure that they behave as commercial undertakings. We recognise that we exist in a mixed economy and see the private sector as being able to realise that it can criticise a particular action and that there must be recourse to some other body in the shape of the Minister about the trading practices. All that has been given to hon. Gentlemen opposite in the former Clause 48, and their opposition now is straight opposition to enabling these industries to use to the full the resources, men, skills, machinery and capital which they have; and that is something that we on this side are not prepared to accept.

Mr. Michael Heseltine

The Minister always makes a most eloquent case, particularly for the very difficult arguments that he has to advance in a circumstance such as this. I think that I shall be justified in taking up one or two points that he made so as to reveal the sort difficulties that we on this side always have in trying to come to grips with this very real difference between the two sides about Clause 48 as it will be and Clause 45 as it was.

I was fascinated by the difficulties, shackles and hardships which were to be imposed on private enterprise to bring it into line with the difficulties that are to be imposed on the nationalised sector if it wants to borrow any further money for these activities. Such organisations were going to have to make these applications to the Minister and raise their money under the most strict disciplines. But one could not help remembering that within the Bill there is no less than £480 million worth of additional borrowing powers available to the nationalised transport boards, and all of that, obviously from what the Minister has said, will be available to these organisations to further the activities which would be put back if we rejected their Lordships' Amendment.

I can think of very few private companies which would turn up their noses if all they had to do was to ring up head office and spend some of the additional £480 million on a commercial enterprise of their own. This money is not available to the private sector and no one in the private sector has access to funds of this sort with the little control which the Minister will be able to exercise.

Mr. Marsh

To keep the hon. Gentleman's speech roughly in line with the facts, surely he does not for a moment believe that the nationalised industries borrow money as easily as that. If he does, I suggest that he has a chat with some of the chairmen of the nationalised industries.

Mr. Heseltine

I fully agree with the Minister. The nationalised industries do not borrow money. They print it. This is the ultimate freedom in financial mismanagement—that there is no need to go to the capital market and raise funds and account to the creditors.[Interruption.]

Mr. Speaker

Order. We ought to be able to hear both sides of an argument without so much noise.

Mr. Heseltine

No better example could one want than the fact that in the Bill about £1,000 million of capital investment in British Railways is being written off. How can the Minister square that ability to write off the capital investment with the tight control that he says will be imposed upon the efforts of further enterprises conducted upon the nationalised industries?

We realise that there are vast hidden assets within the framework of the nationalised sector which could be, and should long ago have been, exploited in the national interest. The surest way to exploit the vast hidden land resources of British Railways would have been to have brought in private developers so that the whole community, including the private developers, could have exploited them.

Mr. Speaker

Order. This does not apply to Clause 48.

Mr. Heseltine

I apologise, Mr. Speaker. I was dealing only with the point raised by the Minister.

In dealing with the decision whether or not we should stand by their Lordships' advice and leave Clause 48 out of the Bill, we have to understand the situation not in the words put to the House by the Minister but in the full enormity of what is proposed by that Clause. Everybody who has read or come in contact with the Bill will be aware that Clause 48 provides certain new powers for the nationalised transport organisations—the National Freight Corporation, British Railways, the National Bus Company, the Waterways Board and the Scottish Transport Group. To all these organisations, which, in their own way, are giants within the economy, two principal additional powers are to be made available.

First, they will be able to manufacture for sale to outside persons anything if they have the skill in it or if they consider they can do it advantageously in connection with some existing activity. Secondly, they will be able to sell and resell—in other words, wholesale or retail—to outside persons anything which is of a kind with what they produce—it does not need to be identical; it merely needs to bear a vague resemblance—or which they purchase during the course of their existing activities. These powers are limitless. I am sure that with ingenuity and the advice of its professional advisers the Ministry could find some sort of activity in which probably these organisations could not indulge.

The great dilemma that faces the House is that we are, on the one hand, granting virtually limitless powers and, on the other, simply granting powers which are permissive. Nothing will happen the day after the legislation becomes law. No detailed investigation will start. We cannot pin down now precisely what we are allowing the Minister of Transport to do in the future. We are, therefore, forced back upon hypothetical examples. It is not in itself difficult to deal with hypothetical examples, but it must leave the House with a sense of unreality.

I cannot tell, and the House certainly cannot, whether British Railways will use their powers to manufacture machine tools, furniture or cutlery. I have no doubt that the House has no idea, and I doubt whether the Minister has an idea, whether the National Bus Company will use its powers to manufacture or sell commercial vehicles, car components or whatever else takes the fancy of its managers.

But what the House certainly does not know, and cannot know, is where these powers—which today for the last time we are considering—will lead and the extent to which we are here fighting shadows. Perhaps most fearful of all, this is the closest this afternoon that we shall ever get to dealing with the realities, for there is no question, in the Bill, of the House being asked to reconsider or consider the proposals in advance of their implementation. So we are giving absolute and total permissive powers to the Minister.

The Minister says that protection exists in the Bill because, after all, his permission will be needed before any of these powers can be exercised. If upon no other issue this afternoon, I would agree with the Minister's interpretation of the law. It is true that his permission will be needed and will have to be sought. However, when I think about what that means in actual terms what do I find? The Minister of one of the largest administrative Departments is bogged down with immense administrative detail and has then to concern himself with the execution of the Bill itself. He has to spend the next 12 months trying to make this massive chunk of legislation work, and then has to sort out how to deal with transport in what I do not doubt will be part of a Bill to be introduced next Session; I know that already he is anxious about ports and docks.

Then, of course, we know that there is a whole range of future policies which have to be considered by this Ministry. All of this has to be done with the least resources, and yet he has the confidence to come here this afternoon to tell the House that we do not need to worry about what is to go on all over England, Scotland and Wales under this nationalised transport operation because he will be keeping watch to make sure that the nation's interests are properly regarded.

I do not find this a very satisfactory situation, because the fact is that the Minister cannot exercise this sort of control. He may want to do it; he may even believe that he will do it; but he knows that this year, or next year, in 10 years' time—well, it will not be 10 years, because we shall have repealed this legislation within two years of our return to office; but whenever it may be, next year or in 18 months—each of these decisions will be put to him merely in Departmental briefs, and which he will have to make by putting a rubber stamp on them because he will never be able to investigate them in any way at all.

If the right hon. Gentleman is to investigate them then let him tell us how he will evaluate the assets which will be employed in all these extraneous facilities. How will he evaluate the market value of British Railways' land, most of which has now been written off in their accounts and a vast chunk of which will be injected, after confiscation from the local municipal authorities, through the passenger transport authorities into other partnership arrangements at no cost?

Let the right hon. Gentleman tell the House what estimates he will make in commercial judgment about the use of marginal costing in the railway workshops. How will he decide, in his commercial wisdom, whether or not it is right for the railways to run a particular project at a loss, hoping for business? How long will he allow this? What standards will he apply? How long will it take him before he discovers projects in the workshops, and on paper, which are not the success he had hoped? How long indeed! I do not myself share his optimism that it will work out in the way he says.

My suspicion is that the truth is to be found much more in the words of Sir Thomas Padmore, his own Permanent Secretary, in the evidence which he gave to the Select Committee on Nationalised Industries. Sir Thomas said: The number of people in the Ministry occupied with railway projects is a tiny handful. This handful of men will now be exercising judgment on behalf of the Minister, watching over our interests throughout this great land, watching over the 300,000 men employed on the railways, to make sure that none of these powers is misused.

This handful of men and one well-intentioned Minister—that does not sound much of a commercial judgment to me, and I hope that the House will for that reason certainly join us in trying to make sure that their Lordships' judgment on this matter is upheld. So the fact is that the Minister prefers his notional legal protection in a situation which calls for commercial judgment. He has not time to exercise the former, and, with the greatest respect, he has not competence to exercise the latter.

4.15 p.m.

The suggestion is continually made that we on this side are opposing this particular proposal on doctrinal grounds, and this is supposed to be an objection which is supposed to make the case out. I note that every time the word "doctrinal" is used by representatives of the most doctrinal party in the country it produces a sort of knowing Pavlovian smirk on the faces of hon. Members on the back benches opposite, because they know what the word "doctrine" is all about. One has only to call on "doctrine" to bring them immediately to their senses. I make no apology for doctrinal objection to the powers in the Bill, which is not doctrine we believe in. Doctrine is nothing more than a summary of our own personal assessments of what is likely to happen; it is a judgment we place as a result of our commercial and social judgments.

These tell us that despite all the precautions inbuilt into this legislation in legal theory, in practice this is the wrong way to run the economy. We are reluctant to permit further nationalisation of unknown companies, unknown activities. We have already seen in the nationalised sector a total aggregate loss of £1,000 million to the country since the war and we do not believe that the results are likely to change or that the pattern will change or that any case is made out for a continuation or extension of these experiments.

We believe it will lead to a proliferation of additional committees, more advisers, more investigators. We believe it will lead, also, to a continued and increasing pressure from the Government on the commercial sector, the Government using not commercial judgments but all sorts of mixed up, quasi-political, social judgments which have little place in a well-managed industrial concern.

I can do no better than quote again from the First Report of the Select Committee on Nationalised Industries which gave its considered view to this House, and it will be at its peril that the House will ignore what the Committee says. On page 32, it is said: The Committee are also disturbed, like some witnesses, by the increasing extent of Government intervention in the detailed management of these industries. For it is on the increase. It is indeed, and this House would be well advised to deny to this most power hungry of all Governments a further feast for their voracious appetite.

Mr. John Hynd (Sheffield, Attercliffe)

We have been treated to a wonderfully vigorous speech from the hon. Gentleman the Member for Tavistock (Mr. Michael Heseltine), but it was not really relevant to the practical issues of the Amendment. The hon. Member was taking up again all the old arguments which we have had over many years on the main issues which divided the parties, the great ideological differences between the parties. It was noticeable that he did not meet the main arguments in the minds of all those who are opposing the Lords Amendment.

Those arguments are simply, as the Minister has explained to the House, that if we are to have this vast complex of activities—and I do not think the party opposite is opposing in general the establishment of the national, coordinated transport organisation which the Bill sets up—if we are to have this great national organisation, if we are to have this concentration of the railway industry to make it a viable industry, if we are to have these great passenger transport authorities with the facilities which they require and the rest of it, it seems fairly simple logic that they should be allowed to use them to the maximum. We have had all this argument over and over again in previous debates.

It was the party opposite which sought to prevent even the existing railway workshops from building wagons and repairing wagons. As I think hon. Members opposite would admit in their more friendly moments, they did that because there was considerable pressure from the private interests who were concerned with these activities and making profit from them.

We do not object to this. Any individual or group is entitled to seek to make a living and to develop an activity or industry for the purposes of making a profit. What divides us is the question of how far this legitimate pursuit should be allowed to interfere with the national interests and the possibilities of viable nationally-organised industries.

The hon. Gentleman gave away the whole argument when he said that our mistake was that as a party we were confusing the issue with social judgments which have little place in any well-managed commercial concern. That may well be so. Paraphrased, it means that there is no conscience, no public responsibility, in business, that there should be no social judgment in any well-managed commercial concern. But the greater part of the legislation passed here which touches on industry, whether under a Conservative or Labour Government, has regard to ensuring that there should be a certain recognition of social values and requirements, even in private industry.

Mr. Michael Heseltine

I totally accept that. I was saying that it is the job of the House and the Government to make sure that the social pattern is acceptable to the nation at large. They must legislate as to how commercial concerns should then behave.

Mr. Hynd

I accept that up to a point, but not entirely, because when we are dealing with nationalised industries the hon. Gentleman and his hon. Friends would be the first to say that a nationalised industry must have a responsibility to the House through the Government on important matters, even if not on the details of its administration, a responsibility that does not apply in the case of purely private concerns.

I could range wide on this issue, but I shall merely refer to the question of the uneconomic activities of B.E.A., such as its service to the outer islands.

Mr. Speaker

Order. The hon. Gentleman should link what he has to say with the question whether Clause 48 stays within the Bill.

Mr. Hynd

I was merely using that as an illustration, Mr. Speaker. There are nationalised activities carried on in the interests of the nation, and many social judgments must be made if those industries are to carry out the functions for which they were created.

I should like a little clarification about subsection (4). Precisely how far is it supposed to apply? Subsection (2) says that the boards and the new authorities shall have power to manufacture for sale, and so on, anything which they may consider … can advantageously be so manufactured or, as the case may be, repaired …". Under subsection (4), they have to submit proposals for such activities to the Minister for his approval. How far down the line does this apply? For example, does it mean that if a motorist has an accident near the garage of a public transport authority in the middle of the night, and seeks its assistance, he must wait until the garage has gone through head office to ask the Minister for his approval? How far does it apply in the case of railway workshops and other installations that already carry on activities of this kind but wish to extend them? Exactly how far into detail is it suggested that this should go?

Is the Minister satisfied with the wording of subsection (4), and that it will be practical to apply what he obviously intends to apply in the wide terms which there seem to be in it?

Mr. Nigel Birch (Flint, West)

I pray that the Minister is not quite as simple as he has made himself out to be. He seems to have the rather curious idea that if one lays down an obligation upon a nationalised industry, or a branch of it, to pay its way it will therefore, do so.

If the right hon. Gentleman casts his mind back to the original Transport Act, which I very well remember, he will know that an obligation was laid on the railways to pay their way, taking one year with another. How many thousands of millions of pounds have gone down the drain since then? He still thinks that the railways will pay because he has laid another legal obligation on them to do so. It is meaningless. We know that it would be completely meaningless to lay a legal obligation on the railways to make any bit of nonsense they wanted to do pay, as it always has been in the past.

The Minister was rather evasive on the question of how the provision would be financed. Any new enterprise of this sort must raise capital. How will that capital be raised? Very simply, by printing the money, as we all know. That is the point to which I wish to come.

There are great arguments against nationalisation from the point of view of efficiency, liberty, and so on, but it is the financial argument, which is very much bound up in this proposition, that I believe is becoming increasingly important. When nationalisation was introduced, in the 1945 Parliament, nobody bothered about this, or hardly noticed it. It was assumed that the money for the capital expenditure of the nationalised industries could be borrowed on the market, that genuine savers would buy Government or Government-guaranteed securities to the extent of the capital expenditure incurred. That has not happened. In the first half of this year the Government had to buy their own securities to the extent of over £100 million. They did not sell any.

Mr. Speaker

Order. The right hon. Gentleman will link his remarks to the question whether Clause 48 shall remain in the Bill.

Mr. Birch

I am saying that yet another great burden—we do not know how much—is liable to be placed on the economy by setting up enterprises which can be financed only by printing the money, because nobody will buy the Government securities. The Minister will never answer this, because there is no answer to it.

That is why the country is in such a wretched mess at present. The reason that none of the economic controls ever works and everything goes down the drain is that the whole economy is out of hand because the Government are printing the money for wretched, ridiculous activities for which there is no social content, or at least not one put forward as such by the Minister. That is steadily draining us financially, raising prices and bringing us down in the world.

Mr. John Hynd indicated dissent.

Mr. Birch

The hon. Gentleman may not understand it. I am certain that our copper-bottomed Secretary of State for Employment and Productivity does not understand it. But I would have hoped that the Minister of Transport might be able to understand it.

Mr. Archie Manuel (Central Ayrshire)

I hope that my hon. Friend the Member for Sheffield, Attercliffe (Mr. John Hynd) and the right hon. Member for Flint, West (Mr. Birch) will forgive me if I do not deal with the same points as they did. The right hon. Gentleman was very skilled at the Treasury in past years, until he had to leave there in a hurry, by we know that he has retained much of his vigour and interest in movements of capital.

I want to refer to some of the points raised in the very long and loud speech of the hon. Member for Tavistock (Mr. Michael Heseltine). I think that he would readily admit that we have heard it all before. We heard that speech in Committee on many occasions and its repetition is now becoming rather tedious. However, a little more publicity is given to these matters when they are debated in the House and some of the hon. Member's comments have to be answered.

4.30 p.m.

Unfortunately, our proceedings in Committee and our debates so far on the Amendments from another place have been bedevilled by Tory political doctrine. The Tories are again playing politics with the railways and with transport generally. The right hon. Member for Flint, West (Mr. Birch) spoke of the enormous losses of the nationalised industries and particularly of the enormous losses of British Railways. Of course, they paid until 1953. He mentioned the losses of the nationalised industries set up since 1945, but there were many before 1945 about which there has not been much criticism. That is some current criticism of the Post Office, but not much about the Navy or the Army, which are both very much publicly owned.

The hon. Member for Tavistock went on to say that too much liberty was being given to the various boards, the railway workshops and so on. As my hon. Friend the Member for Sheffield, Attercliffe (Mr. John Hynd) mentioned, a great deal of work is being done in the railway workshops and there is close accounting. If the hon. Gentleman has a word with the Chairman of British Railways, he will find out what is expected in that regard once the Bill becomes law. I dare say that his hon. Friend the Member for Worcester (Mr. Peter Walker) has had a chat with the Chairman along those lines, as I have had, and has found out about these things. The hon. Gentleman should not try to cloud the issue when he does not know the facts.

The hon. Gentleman said that too much liberty was being given because the capital of British Railways had been written down. After all that lambast and bombast about writing down the capital, is the hon. Gentleman saying that it ought not to have been written down when so many lines and stations have been closed, especially as so much of the capital was watered capital and when much over the original value was paid for the shares? It should have been written down years ago and the railways would then have had the opportunity to break even a long time ago.

Before British Railways, the railways thought that the West Riding Bus Company was becoming a menace and bought out the bus company at 63s. for each £1 share. That is what I mean by watered capital and in that sense the railways are over-capitalised.

Mr. Deputy Speaker (Mr. Sydney Irving)

The hon. Gentleman is entering on too wide a debate of the nationalised industries. The Clause is concerned with manufacture, repair and supply. I hope that he will come to the Clause.

Mr. Manuel

Much more than that has been said. If you had listened to the earlier part of the debate, Mr. Deputy Speaker—

Mr. Deputy Speaker

Order. I must ask the hon. Gentleman to accept my Ruling.

Mr. Manuel

Do I take it that I am precluded by the Chair from answering the comments of the hon. Member for Tavistock? Is that your decision, Mr. Deputy Speaker?

Mr. Deputy Speaker

I can allow the hon. Member to say only what is in order.

Mr. Peter Walker (Worcester)

The hon. Gentleman said that it was essential to write off capital. How does he account for the fact that in their National Plan the Government prophesied that by 1970 the railways would be breaking even without any writing off of capital?

Mr. Deputy Speaker

I am sorry, but I cannot allow the debate to proceed on these lines. We are dealing only with Clause 48.

Mr. Walker

With respect, Mr. Deputy Speaker, a very important part of Clause 48 is specifically concerned with the borrowing powers which will be involved and therefore a great deal of the debate will have to take place on the necessity to increase borrowing powers.

Mr. Deputy Speaker

The necessity for borrowing for the purposes of Clause 48, but not for a general debate on the borrowing powers of the nationalised industries.

Mr. Manuel

I shall try to keep in order.

The hon. Member for Tavistock said that the railways would have too much liberty and I have attempted to answer what he said about the writing down of capital. He and his colleagues have had the opportunity for five months in Standing Committee to scrutinise the activities of the railways. But we could not get to grips with any of the facets of the private enterprise undertakings, no matter what their machinations, which are in competition with the railways. By restoring Clause 48, which was deleted by another place, we are giving hon. Members the utmost liberty to examine everything and hon. Members opposite must accept that that is a great freedom which is not available to many of us who would like to examine many aspects of many share capital allocations in private enterprise and many great aggregations of capital in various spheres which in the national interest might be better directed into other activities. No regard is ever paid to that.

The hon. Member for Tavistock knows a great deal about transport, as he proved in Committee. He is well-equipped to serve the House well, but I hope that he will not weaken the position of the railways by making the sort of speech which he has made today, a speech which was entirely destructive and not for the good of the future of transport.

Sir Harmar Nicholls

We should not be coy about this matter. This is an idealogical debate. It is not Clause 48 which the Lords omitted from the Bill; it is Clause Four of the constitution of the Labour Party. As it stands, Clause 48 gives the Government power to enter into business with all the force of the financial backing which only Governments have. This can be thought by some, who cannot be criticised for thinking it, to be the backdoor to nationalisation. It must be remembered that the Minister who first put Clause 48 into the Bill boasted from the first that, if the Labour Party could not get Clause Four on the Statute Book in the old-fashioned way, it would do so in the new, modern devious way, and that is what Clause 48 is.

Mr. Manuel

On a point of order. Did Mr. Deputy Speaker agree that Clause 48 was the same as Clause Four of the Labour Party constitution? If it was the same surely the hon. Member for Peterborough is out of order.

Mr. Deputy Speaker

All I can agree is that what the hon. Member has said so far is in order.

Sir Harmar Nicholls

I want the hon. Member for Central Ayrshire (Mr. Manuel) to understand what I am saying. It may be Clause 48 in the Bill, but it is implementing Clause Four of the constitution of the Labour Party and I object to it very strongly.

Mr. George H. Perry (Nottingham, South)

Does the hon. Gentleman mean old Clause Four?

Sir Harmar Nicholls

It goes a long way towards implementing Clause Four—the industrial and retailing side of the business of this country. It gives the Government a free hand, a blank cheque, to go into any sort of business to any sort of extent. The only restriction is that it has to have some connection with the railway industry as it now exists. Almost everything that is manufactured or sold in some way or another goes through the railway organisation to a lesser or greater extent.

The Minister, in suggesting how they had tied their hands so that they could not turn it into Clause Four, said that all these matters could not automatically occur through civil servants or officers operating a nationalised board; they had to be approved by the Minister. If we have another Labour Government he will be only too delighted to approve this piece of nationalisation. So there is no protection for the mass of people outside who, at election after election, have shown that they want nothing to do with nationalisation. The right hon. Gentleman's defence, that it has to go through all these restrictions, is no defence against the ideological content of the Clause.

If there is no great urgency about the spheres in which perhaps the work carried out by this nationalised industry ought to be extended, why not bring the various items before Parliament? Why not bring them before Parliament every year, in much the same way as a company works? A company gets out a general policy plan and lets it be known to the people who have to work out the blueprints to put it into operation. If the Government of the day—and they are elected to do this—are prepared to work out a policy each year saying, "Here are the reasons why we believe that the railway workshops ought to be allowed to manufacture this, that, or the other", or, "Here are the reasons why we believe they should be in a position to purchase petrol stations and to retail petrol", and justifies those separate Bills through the normal stages of Parliament, we could not really object.

To ask Parliament to give them a blank cheque to go into any sort of business, because that is what it amounts to, using the collateral of Government security to get the money, and where it is clear that they will be in keen competition with people already in those businesses who are supplying the taxes to give the collateral to the Government to offer, is being very unfair.

Mr. Ronald Atkins (Preston, North)

Is the hon. Member telling us that directors and management of companies bring to shareholders meetings details of day to day management and ask for their shareholders permission?

Sir Harmar Nicholls

No, but they have to justify what they are doing at annual meetings where the shareholders have a chance to discuss matters.

Mr. Gower

They have to deal with bank managers and directors.

Sir Harmar Nicholls

I was coming to that. The safeguard to private business is the viability and good sense of the project if they have to get money from the bank or from the public. But where there is the backing of Government security supporting what is an ideological venture those safeguards do not have to be overcome. Not only on those ideological grounds is this bad, but in their eagerness to give themselves this blank cheque they are trying to impose a nonsense on this House.

The hon. Member for Sheffield, Attercliffe (Mr. John Hynd) recognised it. In a very polite way, because he did not wish to appear to be criticising his right hon. Friend, he said to the Minister, "Is it a fact that you, or anybody sitting in your place, will not be in a position to give the detailed control that the Minister said would be given?" The hon. Gentleman was virtually saying, "You keep in your hands as Minister merely the big decisions. You let all those other little ones and medium-sized ones go through the ordinary run of the officers controlling it."

The hon. Gentleman was asking in advance for the restrictions that the Minister was boasting about to be removed. Anyone who has sat in a Ministry for two minutes—I sat in a couple of Ministries for five years and we had to deal with this sort of detail—knows that about 98 per cent. of the problems which are supposed to be settled by the Minister never come within his vision because of their sheer size and number.

4.45 p.m.

Mr. Marsh

For someone who has had a career as a Minister I find it difficult to understand the hon. Gentleman's incredible description of Ministerial control over capital investment. Of course, Ministers do not decide whether somebody should put a new washbasin round the corner or set up a small garage. Neither does the chairman of any commercial company. If the hon. Member for Peterborough (Sir Harmar Nicholls) has not had the experience—although I am sure that he must have had the experience during that period—let him ask the chairman of any nationalised industry whether he can give a few examples of Ministers who have turned down specific projects. This happens the whole time. They have to file a detailed capital investment programme. Discussions take months, with accountants and economists being involved. Ministerial decisions approving or disapproving certain investments are taken daily.

Sir Harmar Nicholls

All I am asking is that the separate projects should be brought before Parliament so that they can be justified here instead of having this blank cheque so that they can be put on the conveyor belt and worked into a system which is unfair to private enterprise.

The top and bottom of the matter is that we do not trust the Government—they are cheating us a little—and we do not accept the Minister's technical explanation about the safeguard that things would not, should not, and could not happen. We know that the idea of Clause 48 being in the Bill is to move one step further down the road, which we think would be disastrous. It has been proved in practice in the past to be disastrous, and I am certain, under the ramshackle set-up in Clause 48 now, it will be a disaster in future. It is an ideological difference—the other place recognised it as such—and we are resisting it on those grounds. We do not believe that it is good for the nation that a blank cheque of this kind should be given to satisfy the doctrinaire views of the people who sit on the Government back benches.

Mr. Peter Mahon (Preston, South)

The hon. Member for Peterborough (Sir Harmar Nicholls) has a very benign countenance, a manly bearing and a very happy-go-lucky manner. But, for all those splendid attributes, I do not trust him, either. I do not trust his ideas. I do not trust: what he intends for the country and its industry. I hope that the hon. Gentleman will not feel too sad about my opinions on his outlook.

We have, once again, been treated to a tremendous spate of oratory from the hon. Member for Tavistock (Mr. Michael Heseltine). Having served with him on Standing Committee for five months, we can tell him that we are becoming immune to the over-dramatised statements which he makes.

The hon. Member did not fail us today. He made some outlandish statements, such as he has been making for some time. For example, he said that the nationalised industries do not borrow their money, they print it. At first, I thought that he said they pinch it. Had he done so it would have been just as wide of the mark. Such rhetoric adds up to a wildly irresponsible speech.

The hon. Member complained that the debts have been written off. I am very pleased that that is so. The time was opportune to write them off. They were incurred because of the ineptitude of past Conservative Governments and because of the unfortunate way in which the industry has been run for many years. It was timely to write them off in this way. If ever an industry deserves a fresh start it is the transport industry. It is necessary to give it a fresh start because so much depends upon it.

The hon. Member said that my hon. Friends and I have a doctrinaire outlook. Even by the wildest stretch of imagination, the hon. Member will not expect us to apologise for having that outlook. There is a lot behind our doctrinal outlook. For example, there is the question of the dignity of the people working in the industry. From time immemorial, for many thousands of people working in the transport industry there has been very little dignity and very little recognition.

Mr. Deputy Speaker

Order. I must ask the hon. Member to relate his remarks to Clause 48.

Mr. Mahon

To my way of thinking it boils down to the question: where does the money come from? We must be concerned about that. It is a very important question to ask. The right hon. Member for Flint, West (Mr. Birch) asked that question. He made the bold assertion that the Government print the money. That is the same record being played all along the line. That is over-simplifying the situation and denigrating the financial system upon which our arrangements in this country are made.

Mr. Deputy Speaker

Order. The hon. Member will recall that I intervened in the speech of the hon. Member for Worcester (Mr. Peter Walker) on this very point and that Mr. Speaker earlier intervened in the speech of the right hon. Member for Flint, West (Mr. Birch), asking him to relate his remarks to the Clause. I must ask the hon. Member to do the same. The Clause is concerned with manufacture, repair and supply. Much as it concerns the nationalised industries, the debate must be related to the Clause.

Mr. Mahon

I will do my best to conform to your Ruling, Mr. Deputy Speaker, but it has the unfortunate effect of narrowing the debate to the finest possible limits. Most hon. Members in the debate have been in the same unfortunate position as that in which I find myself. But I will try to conform to your Ruling, although it means cutting out the best part of my speech. During my 35 years in local government I never found myself as restricted as I have found myself in this place. That is one of the unfortunate aspects of being a Member of Parliament which I have not enjoyed. I have never circumvented the difficulties.

Mr. Marsh

I assure my hon. Friend that although he may have felt himself circumscribed by this difficulty, none of us on either side of the House has ever noticed it.

Mr. Mahon

I thank my right hon. Friend.

Several hon. Members have asked whether the industry has been run efficiently. There are definite and salutary checks and limitations on capital expenditure in running a nationalised industry. We have had the salutary confrontation of devaluation in recent months and there are such people as the International Monetary Fund and such things as adverse trade balances. To say that we have a cavalier approach to capital expenditure and that we do not care as long as we get through our ideological outlook beggars description and is most unworthy of hon. Members opposite. We know that they are trying to put up a good front and to suggest to the country that the Bill will be inimical to the best interests of the people. They are making a splendid effort to do that, but they will fail. After the many months during which we have been debating the issue the people are beginning to realise that the industry cries out to be reorganised to bring about the smooth running and improvement of the transport arrangements of the country.

5.0 p.m.

Mr. John Peyton (Yeovil)

I will not follow the hon. Member for Preston, South (Mr. Peter Mahon) at any great length except to say that any eloquence of argument which my hon. Friends or I could deploy against the Bill will achieve nothing compared with the transition of the Bill into an Act of Parliament. When the country is faced with the fact of this legislation, and all that flows from it, there will be a great deal more hostility than hon. Members opposite appear to expect and far more than such mild-mannered men as ourselves could possibly hope to generate.

The Minister once again deployed his almost unequalled skill at bending words. At one time, with a charm which none could emulate, he declared himself as being non-controversial in supporting this unpleasant Clause. Almost in the next sentence he referred to the pig-headedness of my hon. Friends' opposition to the Clause which seemed to introduce a slight element of controversiality whatever the Minister may think.

The right hon. Gentleman used a favourite argument, which he deploys on every subject—that there is no need for our anxiety about the Clause because of the very extensive safeguards written into the Bill, and, in particular, the extensive powers in the Minister's hands. We have to reflect that, though not the parent of the Bill, the right hon. Gentleman is at least one of its sponsors. He speaks of its terms with enthusiasm. We therefore can be forgiven for taking no comfort whatever from the fact that the Minister has extensive powers. Extensive powers in the hands of Ministers is a situation at which some of us look with a good deal of suspicion. I have no doubt that the anxieties expressed by my hon. Friends about the way in which the Minister will use his powers are very well founded.

The Minister said that he was asking for no special privileges for the public sector. I find that astonishing. If he listens to and understands the argument, I do not see how the Minister can continue to make that claim. Our objection has been made clear in respect of every nationalised industry. We object to the privileged access by these industries to public money and we regard a constant reiteration of Ministerial safeguards as being mere eyewash. The Minister intervened in a speech of my hon. Friend the Member for Peterborough (Mr. Harmar Nicholls) to justify it all by saying that on occasions Ministers have turned down projects put forward by nationalised industries. Of course they have, but I have a horrible feeling that they have probably turned down good projects and approved crazy projects.

The Minister should not expect us to be in any way convinced by these arguments, which he put forward so innocently. The powers conferred by the Clause are to our minds very objectionably wide. To confer upon an organisation powers to manufacture and repair anything which the organisation considers can advantageously be so manufactured—not "profitably", but "advantageously"—in the opinion of the authority itself is to confer very wide powers indeed. How could we be expected to credit Ministers who are the authors of such provisions with a desire to limit severely the way in which they are put into action?

I am the first to admit that if nationalised industries generated large and extensive profits, any arguments which we could deploy would be very limited in their effect. One or two hon. Members opposite have trotted out the old liturgical argument that Tory Members of Parliament usually speak to do the bidding of their friends in private enterprise who wish to make profits by these activities. Nobody has approached me on the subject, and the apprehensions which I am expressing are being expressed on behalf of myself and my constituents, who fear that the taxpayer's money will be wasted.

We have been looking at the results of nationalised industries. If the Minister could turn up the record and show a constant profitability, the argument from this side of the House opposing such a Clause as this might be a good deal weaker. But he cannot do so. The Minister seems to think that a suitable monument to failure is to extend the areas of the organisation. I am becoming tired of the argument being trotted out so often by his hon. Friends that we all agreed to set up these large organisations and now we have to give them something to do. That is not an acceptable argument, and the Labour Party ought not to expect it to go down very well.

I am sure that the House is right to look with a great deal of apprehension at the powers conferred by the Clause on the Minister and I am sure that my right hon. Friend the Member for Flint, West was right to remind the House, in particular, of the large borrowing which will be required in order to finance these powers. I am certain that if I were a member of another place, nothing would annoy me more than to find myself deluged with advice from the House of Commons, which itself is not very good at accepting advice.

I hope that the House of Lords, having deleted this obnoxious Clause, will stick to its guns and insist on its deletion. I do not believe that anything said by the Minister could justify what he has in mind to an audience of anything but bigoted supporters. To a lifelong Socialist, this part of the Bill may look like the entry into the Promised Land. But if the charms of Socialism have begun to wear a bit thin, I hope that hon. Gentlemen opposite will look somewhat more realistically at what is promised, whereupon they will discover that they can vote only one way, and that is for the enthusiastic rejection of what is, at best, optimistic nonsense.

Mr. George H. Perry

I am always bemused when I hear hon. Gentlemen opposite refer in sneering terms to railway finances and deficits. When I was a railway employee in 1947, the year before nationalisation, the railways lost £67 million. Throughout the last war the railways received £40 million every year to enable them to keep going. Over the 10 years between 1929 and 1939 the railways were allowed by successive Governments to carry annual deficits. Today, nothing is new except the amounts involved, and they are greater only by virtue of the change in the value of money. Thus, the argument of hon. Gentlemen opposite dies flat, and that nails the lie which they seek to spread.

The hon. Member for Peterborough (Sir Harmar Nicholls) argued that Clause 48 was like Clause Four. As a Socialist, I wish it were. After all, there are 26 million people fully employed in Britain and all paying their National Insurance contributions. The railway workshops employ fewer than 60,000 people. Their numbers were reduced by 50,000 in the last 15 years.

With my railway background, I can speak with more experience of this industry than probably any other hon. Member. From midnight on 31st March, 1966 I ceased to be a railway workshop employee. I had been employed in that capacity for 20 years and I had been a member of the negotiating machinery of what was then British Railways for 13 years. I remember how, in 1965, as secretary of the trades council, I wrote on behalf of 36,000 people in Derby asking the then Minister of Transport, Tom Fraser, to introduce a Measure of the kind we are now discussing and so allow the railway workshops to go into the export business and compete freely with private enterprise.

Let us be clear about the provision under discussion. It was mentioned in the Labour Party's election manifesto, "Time For Decision". Those who voted for us knew that it was our intention to take this step. Whatever may be said about the Labour Party not keeping its promises, we are keeping our promise this time [An HON. MEMBER: "For a change."] The hon. Member cannot deny that our promise is being kept. We said that we would introduce a Measure to allow the railway workshops to compete in the private sphere.

One would think from the way in which the hon. Member for Peterborough speaks that it is unprecedented for the nationalised industries to wish to compete with private industry. What are the civil airlines doing? What about the electricity, gas and coal industries? They are selling solid fuel and other heating equipment in competition with private enterprise.

If hon. Gentlemen opposite are certain that private enterprise is so superior to the nationalised industries, of what are they afraid? Do they fear the competition which is about to start? I wish to shout on behalf of my former colleagues in the railway workshops because I know that they can compete. That frightens hon. Gentlemen opposite. They know that the railway workshops can build rolling stock and other equipment that will sell in free competition.

Mr. Gower

Is the hon. Gentleman aware of the difference between a private concern and a nationalised industry? If a manufacturer sets up business in an area—even in a development area—and goes bankrupt, nobody will help him. If a worskhop of British Railways gets into financial difficulty, the whole system will hold it up.

Mr. Perry

The hon. Gentleman will find, on examination, that that is not the whole story. If a railway workshop is taken away from a workshop town, that town soon becomes a ghost town. I can think of Doncaster, Crewe, Swindon and Eastleigh. Derby is a different kettle of fish. I come from Derby and am aware of the position there. The main workshop towns welcome the Bill. Hon. Gentlemen opposite will not find many people, even Tory supporters, in those towns being prepared to argue against the Bill. They appreciate that it will ensure their future. Local chambers of commerce and trade will benefit as a result of the Bill.

Shortly before the Summer Recess, Mr. Johnson, the Chairman of the Railways Board, explained that the activities that will be permitted by the Clause will represent only a small percentage of total requirements. This means that British Railways will be able to sell their unused capacity. This is the ogre which frightens hon. Gentlemen opposite, although it is only a small one. But big things sometimes grow from little ones.

If this industry can be efficient and work on behalf of the nation, particularly in the export trade, it should be given a chance to do so. It may fail, but at least we will have given it a chance to succeed. Private enterprise sometimes fails. On behalf of the 55,000 to 60,000 people employed in the railway workshops, I welcome this provision and hope that they will do their best to compete in export and other markets and so help our balance of payments.

Mr. Bessell

Hon. Members who were members of the Standing Committee listened on many occasions to the hon. Member for Tavistock (Mr. Michael Heseltine). Today, he spoke particularly forcefully and effectively, and the case he presented illustrated the point made by the Minister, who said that we were confronted by a matter on which there was a fundamental difference of principle between the two sides of the House. The Minister was right. There is no doubt that this is something that cannot be reconciled. I do not propose to try to persuade hon. Gentlemen opposite that our view is right, any more than they could hope to persuade me that they are right.

There is, however, one issue on which there is unanimity. My opposition to Clause 48—or Clause 45 as it was when we discussed the provision in Committee and on Report—is in no way aimed at the railway workshops. I have always taken the view—I have said this on many occasions, and I repeat it lest there be any doubt—that it is right that any excess capacity in the workshops should be used to provide other means of employment for those engaged in the railway industry. I see no harm in the limited diversification of capacity within the workshops.

That is not the basis of my opposition to the Clause. The worst aspect of this provision appears in subsection (6,b), which gives the Waterways Board … power to sell goods of any description to outside persons, whether or not persons using their waterways, at any place where persons … may require facilities for the purchase of those goods, and for that purpose to purchase any such goods. This means, in effect, that the Waterways Board can, if it so chooses, decide that someone using waterways and living in, say, Birmingham and who needs to buy fishing tackle and anything connected, or even unconnected, with the waterways may be provided with those goods; and there is nothing to prevent the Board from establishing a retail outlet for this purpose.

5.15 p.m.

However much one stretches a piece of legislation which deals with the nation's transport system, I do not believe that one can allow that it is possible to encompass, within the framework of transport, this sort of retail activity. This has always been my greatest objection to the Clause.

We have discussed today the question of commercial viability. The Minister emphasised that none of these activities could be undertaken unless they were commercially viable. This is far too loose a term. There is nothing in the Clause, or any of its dependent Clauses, which says that a profit must be made. Nobody would invest money in the private sector unless there was a return in terms of profitability. To be "commercially viable" does not necessarily mean that a profit must be made.

It is possible, for example, for an investment to be made, for the capital to be serviced and for all the responsibilities of the company or individual to be discharged by reaching only a breakeven position. It might be argued that a break-even position is commercially viable, but in the private sector a profit must be made. Thus, these boards and industries will be given an unfair means of competition.

Mr. George H. Perry

Surely these nationalised undertakings should be allowed to receive a working balance to enable them to indulge in necessary capital expenditure without having to borrow?

Mr. Bessell

I accept that, and if that were written into the Bill—if it were clearly stated that it was necessary for a profit to be made—my fears would be allayed. But that is not the position and nothing of the sort is said either in Clause 48 or in its dependent Clauses. That is the basic difference between the two sides of the House. We fear the unfairness of the competition that could be created.

It has been argued that there should be diversification, and I do not necessarily disagree with that. There could be circumstances in which it would be wise for an industry to diversify. Hearst News- papers of America provides a good example of diversification. That company has diversified into real estate, magazines, paper and pulp and other activities directly concerned with the newspaper industry. That is wise diversification.

In this case it will be possible for all types of diversification to occur. This must be wrong, if it is completely outside the scope of the transport undertaking, and I submit that to envisage such a step is outside the scope of this type of Measure.

Mr. Geoffrey Wilson (Truro)

Does the hon. Gentleman recollect that, in Committee, I was told that the Railways Board could run a boot and shoe shop in the middle of Birmingham?

Mr. Bessell

I am grateful to the hon. Gentleman for reminding me of that debate. It was decided on that occasion that it would be possible for the Waterways Board to sell virtually anything, from fish to elephants. This emphasises the need for proper diversification.

I am not concerned with the issue of the railway workshops. If it were possible for the Clause to provide for their spare capacity to be used in the way that some hon. Gentlemen opposite have advocated, I would be glad to support them. I do not in any way question the honesty of the statements which the Minister has made to us. I do not in any way doubt his interpretation. I am sure that if it were left to him the right hon. Gentleman would see to it that no wide diversification took place; that there was no great speculation of public funds. I am quite certain that he would ensure that transport undertakings dealt with transport and not with all the various activities which it would be possible for them to enter, as described by the hon. Member for Truro (Mr. Geoffrey Wilson). I am sure of that, but the fact is that profitability is here and the legislation is permissive. That is where the danger lies.

That is why I say in all seriousness, and not emotionally, that I regard the Clause, as I have always regarded it, as wicked and dangerous, and capable of creating a whole new field of nationalisation wider than anything that has been considered or contemplated since Clause Four of the Labour Party constitution was written. For that reason I support their Lordships' Amendment, and I hope that, once again, we will still have the chance of seeing the Minister changing his mind; that he will at least write in the modifications that are essential if this is to be a safe Clause and not one to interfere with a whole range of things which have no connection whatever with transport.

Mr. Ronald Atkins

I am much happier with this debate. Yesterday, hon. Members opposite accused the Government of lopping off powers from the very large public authorities and boards. Today, they accuse the Government of trying in sinister fashion to extend the powers of public boards. I am grateful to them for doing so, because it brings us back to the natural order of things.

The hon. Member for Peterborough (Sir Harmar Nicholls) put his finger on a salient point when he said, looking at the Government Front Bench, "The trouble is that we do not trust you". That illustrated the views of hon. Members opposite, but the hon. Gentleman missed the point that my hon. and right hon. Friends will not be sitting on these authorities. The authorities will not consist of diehard Marxists: not that I suggest that my right hon. Friend is a diehard Marxist—far from it. The members of the authorities will be recruited from various people, and as long as we have so many local authorities temporarily controlled by Conservatives we may have some anti-Marxists.

There is nothing in the administration of the boards so far to show that the managers, especially of British Railways, are motivated by Marxist ideas. For instance, the railways have recently decided that the maintenance of diesel electric locomotives shall be done by the manufacturers of those locomotives. I, in my non-doctrinaire way, support this, particularly since they are repaired in my constituency or that of my colleague for Preston, South (Mr. Peter Mahon). We do not have to look further to see that these boards are not motivated in that way, and it is they who will be responsible for the decisions. As a matter of fact, some of my back bench colleagues have to watch, notably, the Steel Board, to stop it lopping off powers in that way. I can assure hon. Members opposite that there is no need for them to worry on that score.

I suspect that their real worry is lest any nationalised industries make profits because that would rob them of one of the biggest planks in their electoral platform. Secondly, they do not want the nationalised industries to make profits because they want all those profits for private enterprise.

They talk about equality of commercial opportunity, but if we tie the hands of public authorities in the way suggested we may subject them to most unfair competiton. As is known, the nationalised boards always buy British, but if they are put into the hands of British manufacturers and forbidden to buy goods from abroad there will be insufficient private enterprise competition. The only way for them to protect themselves is the threat of going into manufacture themselves. I rather suspect that hon. Members opposite are speaking tongue in cheek, and that what they are really afraid of is that profits that might go to private industry will go to help the public purse.

Mr. Gower

The hon. Member for Preston, North (Mr. Ronald Atkins) has just advanced the most remarkable theory. He said that as a lot of people on the boards would not be Marxists it would be good policy to give them Marxist powers so that they would not operate them.

The hon. Member for Bodmin (Mr. Bessell), who has just left the Chamber, dealt with one aspect of this matter, but dealt only briefly with the railway workshops. We on this side are not opposed to reasonable operation of railway workshops, but under this Clause factories could spring up quite unlike the railway workshops. Without any exaggeration at all, I think that this is an appalling Clause because it gives such tremendous scope for new activities which were never contemplated when the railways were first taken into State ownership.

By this Clause, electric light fittings and all such things could be manufactured. Carpets, mats, towels, soaps, cushions, seats, chairs and furniture could all be manufactured, purchased or sold, as could cutlery, glass and windows, stationery and paper—one could continue with the list for a very long time. It is quite absurd. It is inconceivable that the Minister and his colleagues should try to disguise this as a modest extension designed to enable them to keep the railway workshops working a little nearer to capacity.

I should like to emphasise, as has been suggested before, that this is not a question of competition betwen equals. These are not equal bodies. On the one hand, we have the State bodies, with preferential access to State money and, on the other, companies and firms of all sizes and conditions which are subject to the fairly harsh discipline of having to go to the joint stock banks for advances and to the market for capital. There is a complete difference.

There is also seen the possibility of firms starting up in difficult areas, even development areas and then suffering unfair competition as a result of this Clause and getting into financial difficulty. I have often heard hon. Members representing constituencies in Scotland, the North of England and other parts, pleading with the Board of Trade to bring firms to their areas—even United Slates firms. I can well imagine that if United States firms come to Scotland or to the North of England they do not expect unfair competition from a nationalised industry and will be much more likely to develop in countries where they would not suffer such unfair competition from the local industries there. There are all sorts of possible dangers. How do the Minister's colleagues at the Board of Trade say to an American company, "You come to this part, but we cannot guarantee that British Railways will not start up your kind of industry just a few miles away"?

Mr. Marsh

The hon. Gentleman will be aware that a number of American oil companies are in direct contractual partnership with nationalised bodies such as the National Coal Board and the Gas Council.

Mr. Gower

Yes, but how can the President of the Board of Trade persuade any American company if he is unable to give an assurance that under the Clause a rival activity of British Railways will not be set up to run on unfairly advantageous terms? These are some of the reasons why I regard this as an awful Clause. We should agree with their Lordships and delete it from the Bill.

5.30 p.m.

Mr. J. Bruce-Gardyne (South Angus)

This is the first opportunity which hon. Members who did not serve on the Standing Committee have had to consider this Clause, because of the operation of the Guillotine on Report. We should be grateful to their Lordships for providing us with this opportunity.

I entirely endorse everything that my right hon. and hon. Friends have said against the Clause in principle and in all its scope. I shall devote a few remarks to an aspect of its consequences to which, so far as I am aware, attention has not been drawn either in Committee or in another place. This consequence, unlike the other consequences to which attention has been drawn, is not merely a hypothetical consequence but is an admitted one. It is a consequence which differs in kind from all the other possible consequences of the Clause.

It is my understanding that under subsection (2,c) repair shops set up by nationalised industries for vehicle repair would be entitled to apply for and receive authorisation to carry out Ministry of Transport vehicle testing. This is not merely my assumption. Earlier this year I received an assurance from the Joint Parliamentary Secretary that the Minister had no plans to combine vehicle testing to stations set up under the terms of the Clause. That is an assurance that at least the Minister has no intention, at the moment at any rate, to give a monopoly of vehicle testing to garages which might be set up under the terms of the Clause.

There is a difference in kind between the consequence of allowing nationalised industries to indulge in vehicle testing from the other consequences that might flow from the passage of the Clause. The difference is that, if the railways or the other new boards go into the business of supplying petrol or undertaking vehicle repairs with the backing of the taxpayer and the printing press, at least they are not empowered to order free enterprise competition out of business. In the case of vehicle testing stations, the Clause would make the Ministry, in effect, judge and jury. It is the Ministry which decides where the authorisations may go. The Clause would empower the nationalised industries, if the Minister felt so inclined, to benefit from differential and preferential treatment in the business of the award of vehicle testing authorisations.

Unfortunately, from evidence which has been brought to my attention, I am by no means certain that this is a purely academic proposition. Evidence has been brought to my attention to suggest that the Ministry is actively engaged at present in ruthlessly using its powers to drive out smaller private enterprise vehicle testing stations from the right to receive authorisation. I should be out of order if I were to go into this now. I intend to raise on the Adjournment at the earliest possible moment the case which has been brought to my attention.

The constituent who has drawn this outrageous behaviour of the Ministry to my attention told me that there is a strong feeling in the motor industry, certainly in Scotland, that the Ministry is engaged in trying to squeeze out the smaller vehicle testing stations as a first step in a strategy and that the second and third steps will be that, once vehicle testing has been confined in the private sector to the larger garages, where it is probably of considerably less commercial interest than it is in smaller garages, they will be encouraged to move out and leave it to the nationalised industries which are empowered to conduct testing under the terms of the Clause.

I hope and pray that these fears are unfounded, but the passage of this legislation in this form is bound to give rise to such fears. Lord Shepherd, speaking on this Clause in another place, said this: I do not deny that certain provisions in this Bill may have an effect on some small private organisations. But in terms of the national wellbeing and the national development this happens from time to time."—[OFFICIAL REPORT, House of Lords, 1st July, 1968: Vol. 294, c. 143.] I cannot see how the national well-being or the national development can be furthered by the transference of services rendered to motorists from garages which must perform them profitably or not at all to garages which are entitled to draw upon the taxpayer or the printing press. Above all, I cannot see how the national interest can be served by enabling the Ministry to grant the railways a new monopoly of a service, namely, vehicle testing, in which they are not at present engaged. This is in a different class from the other objections that can be raised to the Clause, all totally valid and all adding up to an insurmountable case for accepting their Lordships' advice and removing the Clause from the Bill.

Mr. Marsh

I have heard the hon. Member for South Angus (Mr. Bruce-Gardyne) make many speeches, all of which have been interesting. I have never heard him use a debate of this type to discuss a subject on which he could quite easily have written a letter and received an answer.

This has been a long debate—understandably so, because, as the hon. Member for Peterborough (Sir Harmar Nicholls) said, it involves a classic difference between the two sides. The hon. Gentleman got himself involved in a doctrinaire struggle which the Labour Party got out of 10 years ago. He saw this as a plot to nationalise the whole of British industry. We heard again today, as we heard in Committee, the stories of what will happen when British Railways are running cutlery factories, shoe shops, and so on. Hon. Gentlemen are being rather less than serious. Why should the railways wish to run cutlery shops or factories, or boot repair shops? The railways do not run anything of this sort now and there is no reason why they should in the future. I cannot conceive that a Minister of Transport of any party would allow the railways to do so in the future, even if they wanted to.

The hon. Member for Yeovil (Mr. Peyton), in his characteristically gusty fashion, said that if only nationalised industries were making profits he would not mind: it was the fact that the taxpayers' money was going down the drain that worried him. It will be interesting to hear the hon. Gentleman perform a feat of verbal gymnastics when we reach the hotel Clause, because the hotel section of British Railways is making a profit. However, the hon. Gentleman's views on that will probably be the same as they are on this, that he objects to the nationalised industries having the freedom to operate commercially.

We hear a lot about the ease with which nationalised industries can obtain money from the Treasury. I cannot help saying, in passing, that Mr. Scanlon might well have found the Chancellor more forthcoming than the Midland Bank. On the whole, there is a great deal of evidence that nationalised industries complain bitterly about the degree of control imposed upon them and about the difficulties they have in obtaining their capital.

The right hon. Member for Flint, West (Mr. Birch) made the point that all this hangs on the legal obligation on the industry to pay, and said that it was nonsense. He began with the rather simpliste argument that all nationalised industries fail, which is not true, as he knows very well. But it is not true that the Clause which we are discussing has nothing of value in it. While merely to say that the nationalised industries have an obligation to pay their way does nothing of itself and certainly does not make them profitable. If the obligation to pay their way under the Bill was all that was involved here, it would have no meaning. Hon. Members opposite would be justified in saying that it meant nothing, because they themselves, on a number of occasions wrote exactly the same proviso into Bills of their own, and it meant nothing.

The reason that the mere obligation to pay meant nothing was that right hon. and hon. Members opposite did not take the other decisions to enable nationalised industries to pay. This is why we do not just put in an obligation on these industries to pay their way and to act in a commercial manner. We go further and make real provision for a proper financial structure, and so forth to enable a nationalised industry, particularly the railways, to start off sensibly. We make provision in the Clause to enable these industries to use their assets to the full. In this and other Clauses we make provision for the industries to engage in certain activities from which they can show a profit.

The hon. Member for Barry (Mr. Gower) sees the spectre of an enormous impact upon our foreign competitors when they come to this country and find themselves deterred by the presence of nationalised industry here. I think that some of the countries which he mentioned have a level of governmental intervention in their industrial and commercial policy which even this Government would not impose on British industry.

But, apart from that, the truth is that there is evidence of foreign companies which want to be associated with British nationalised industries, Continental coal companies in direct contractual partner- ship with the National Coal Board, Continental oil companies in association with the Gas Council, drilling in the North Sea, and so on. [An HON. MEMBER: "It is Hobson's choice."] No, it is not; they chose their partners themselves.

Mr. Gower

That is completely different. I was pointing out that an American or Italian company coming here and wishing to set up in a development area or any other part of the country would be somewhat surprised if it then had to face unfair competition from British Rail in the same industry.

Mr. Marsh

That would be true if they did, in fact, face unfair competition, but the whole purpose of the Clause and the accompanying provisions is that it shall not be unfair. There would be no sense in it otherwise. I see no merit in a nationalised industry just running wild about the country and setting up cutlery shops, furniture shops and the rest. If it can make money out of it, that is good. [HON. MEMBERS: "Oh."] Yes. We hear a lot about the financial obligations of the nationalised industries. The last contentious debate in which I was involved in the House was about the Bristol West Dock, when there was an argument about whether there should be a capital investment of £15 million. The hon. Member for Worcester (Mr. Peter Walker) and his right hon. Friend the Leader of the Opposition said that it was a disgraceful decision. What right, they asked, had any Minister to prohibit capital investment on the basis of D.C.F. returns? The same argument can come up each way on different questions.

When one comes down to the point of this whole argument, the hon. Member for Peterborough (Sir Harmar Nicholls) is right. The argument of the Opposition, shorn of the "phoney" talk of nationalised industries doing things which nobody in their right mind could conceive of their doing, shorn of all that "flannel", is a doctrinal objection to the public sector being able to compete on equal terms with the private sector. This is where the difference lies between us. We are now giving hon. Members opposite an opportunity to stand by their oft repeated pledge that they believe in competition.

If the Opposition do believe in competition, fair competition, if they believe in nationalised industries being treated as commercial concerns—and it is not the function of a nationalised industry to provide social amenities; it is the job of the Government to inject what is desirable in social policy—then they should see that a nationalised industry should be allowed properly to run itself and to produce a profit. If we believe that that is how the industries should operate, and if we provide for the necessary safeguards, as we have, there is no reason why hon. and right hon. Members opposite should persist in the stand which they have taken so far.

If there is to be a Division on this matter, I hope that hon. Members opposite will recognise that what they are doing in going to the Lobby against the Government is trying to ensure—only trying, because they will not be allowed to do it—that the nationalised industries are not allowed to use expensive assets and vast public investment in the same way as a private company can use its assets.

5.45 p.m.

Mr. Peter Walker (Worcester)

The Minister has shown his usual enthusiasm for the principle of public ownership. Some of us remember that he made his political reputation in the House by a very fine speech from the back benches defending nationalisation when the present Government were in opposition. Much to their shock at that time, his right hon. and hon. Friends actually found one of their back-bench colleagues willing to defend nationalisation with some enthusiasm. Since then, the Prime Minister has given the right hon. Gentleman every opportunity to fulfil his desires. He has been responsible for extending nationalisation to steel, and now he is carrying through the very considerable provisions for public ownership in the present Bill.

There is a dilemma here. I fully understand the point made, for example, by the hon. Member for Nottingham, South (Mr. George H. Perry), who worked for some time in railway workshops. There must be occasions when nationalised industries would like to use their assets for other purposes, to diversify into other activities from which, under the present arrangements, they are restricted. But this is the dilemma in having nationalised industries.

If we are to have a mixed economy and in that economy nationalised industries are to be financed on terms far better than can be obtained for the private sector, and if we are to allow nationalised industries to write off capital to the enormous extent which they have, we cannot then run the economy in such a way as to allow the public sector and the private sector to go into free and unrestricted competition. This is the dilemma and the problem.

The hon. Member for Preston, South (Mr. Peter Mahon) said that he was delighted because under the Bill £1,200 million of capital had been written off—great celebrations; very good, he said—and he was delighted that it had been done at last. That is a reasonable position for him to take, and it is one which has been taken in one nationalised industry after another. But one cannot take the same attitude towards capital in the private sector. This is the great dilemma. Enormous borrowing powers are provided for in the Bill, and some of those borrowing powers will be used to enable some of the existing nationalised industries either to extend their activities in their own spheres or to go into new spheres altogether. I do not believe that at this time, in the present state of our economy, it is right that public money should be used for that purpose. This is another reason why we oppose the Clause.

There are three fundamental points of difference between the two sides of the House. On the question of management, we are against the Government's proposal because, basically, all the nationalised industries concerned have great management problems in their own sphere. It is much more important that British Railways get on with the job of managing the railways properly instead of looking to other diverse activities in which they have no skills.

On the question of finance, the strong points made by my right hon. Friend the Member for Flint, West (Mr. Birch) show how enormous is the public debt, how it steadily grows, and how the Clause will add to that problem.

Finally, on the question of a mixed economy, we believe that public ownership has already gone too far. There has been a considerable extension of public ownership under this Government. By the time this Bill becomes an Act, the Government will have nationalised steel and large sections of the bus industry. They intend, they say, to go on to nationalise the ports and docks. We are reaching a situation in which private enterprise is so dependent for the ultimate price of its goods upon the products and prices of the monopoly public sector that it does not have the freedom to compete abroad which we should like it to have.

I therefore conclude with this warning to the chairmen of the nationalised industries: if they have used the Clause to diversify their activities, we shall examine those activities when we come back to power and return them to the private sector at the earliest opportunity.

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

The House divided: Ayes 265, Noes 210.

Division No. 297.]	AYES	[5.50 p.m.
Albu, Austen	Dunn, James A.	Kenyon, Clifford
Allaun, Frank (Salford, E.)	Dunwoody, Dr. John (F'th & C'b'e)	Kerr, Mrs. Anne (R'ter & Chatham)
Alldritt, Walter	Eadie, Alex	Kerr, Dr. David (W'worth, Central)
Anderson, Donald	Edwards, William (Merioneth)	Kerr, Russell (Feltham)
Archer, Peter	Ellis, John	Lawson, George
Armstrong, Ernest	English, Michael	Leadbitter, Ted
Ashley, Jack	Ensor, David	Ledger, Ron
Atkins, Ronald (Preston, N.)	Evans, Fred (Caerphilly)	Lee, Rt. Hn. Frederick (Newton)
Atkinson, Norman (Tottenham)	Evans, Ioan L. (Birm'h'm, Yardley)	Lee, Rt. Hn. Jennie (Cannock)
Bagier, Gordon A. T.	Faulds, Andrew	Lestor, Miss Joan
Barnes, Michael	Fernyhough, E.	Lever, Harold (Cheetham)
Barnett, Joel	Finch, Harold	Lever, L. M. (Ardwick)
Baxter William	Fletcher, Raymond (Ilkeston)	Lewis, Arthur (W. Ham, N.)
Beaney, Alan	Foley, Maurice	Lipton, Marcus
Bence, Cyril	Foot, Rt. Hn. Sir Dingle (Ipswich)	Lomas, Kenneth
Benn, Rt. Hn. Anthony Wedgwood	Foot, Michael (Ebbw Vale)	Loughlin, Charles
Bennett, James (G'gow, Bridgeton)	Ford, Ben	Lyon, Alexander W. (York)
Bidwell, Sydney	Forrester, John	Lyons, Edward (Bradford, E.)
Bishop, E. S.	Fraser, John (Norwood)	Mabon, Dr. J. Dickson
Blackburn, F.	Freeson, Reginald	McCann, John
Booth, Albert	Galpern, Sir Myer	MacColl, James
Boston, Terence	Gardner, Tony	Macdonald, A. H.
Bottomley, Rt. Hn. Arthur	Garrett, W. E.	McGuire, Michael
Boyden, James	Ginsburg, David	McKay, Mrs. Margaret
Braddock, Mrs. E. M.	Gordon Walker, Rt. Hn. P. c.	Mackenzie, Gregor (Rutherglen)
Bradley, Tom	Gourlay, Harry	Mackie, John
Bray, Dr. Jeremy	Gray, Dr. Hugh (Yarmouth)	Mackintosh, John P.
Brooks, Edwin	Greenwood, Rt. Hn. Anthony	Maclennan, Robert
Broughton, Dr. A. D. D.	Gregory, Arnold	McMillan, Tom (Glasgow, C.)
Brown, Rt. Hn. George (Belper)	Grey, Charles (Durham)	McNamara, J. Kevin
Brown, Hugh D. (G'gow, Provan)	Griffiths, Eddie (Brightside)	MacPherson, Malcolm
Brown, Bob(N'c'tle-upon-Tyne, W.)	Griffiths, Will (Exchange)	Mahon, Peter (Preston, S.)
Brown, R. W. (Shoreditch & F'bury)	Gunter, Rt. Hn. R. J.	Mahon, Simon (Bootle)
Buchan, Norman	Hamilton, James (Bothwell)	Mallalieu, E. L. (Brigg)
Butler, Herbert (Hackney, C.)	Hamilton, William (Fife, W.)	Mallalieu, J. P. W.(Huddersfield, E.)
Butler, Mrs. Joyce (Wood Green)	Harper, Joseph	Manuel, Archie
Cant, R. B.	Harrison, Walter (Wakefield)	Mapp, Charles
Carmichael, Neil	Heffer, Eric S.	Marks, Kenneth
Carter-Jones, Lewis	Herbison, Rt. Hn. Margaret	Marquand, David
Coo, Denis	Hilton, W. S.	Marsh, Rt. Hn. Richard
Coleman, Donald	Hobden, Dennis (Brighton, K'town)	Mason, Rt. Hn. Roy
Conlan, Bernard	Hooley, Frank	Mayhew, Christopher
Corbet, Mrs. Freda	Houghton, Rt. Hn. Douglas	Mendelson, J. J.
Craddock, George (Bradford, S.)	Howarth, Harry (Wellingborough)	Millan, Bruce
Crawshaw, Richard	Howarth, Robert (Bolton, E.)	Mitchell, R. C. (S'th'pton, Test)
Cronin, John	Howie, W.	Moonman, Eric
Crosland, Rt. Hn. Anthony	Hoy, James	Morgan, Elystan (Cardiganshire)
Cullen Mrs. Alice	Hughes, Rt. Hn. Cledwyn (Anglesey)	Morris, Charles R. (Openshaw)
Dalyell, Tarn	Hughes, Hector (Aberdeen, N.)	Morris, John (Aberavon)
Davidson, Arthur (Accrington)	Hughes, Roy (Newport)	Moyle, Roland
Davies, G. Elfed (Rhondda, E.)	Hunter, Adam	Mulley, Rt. Hn. Frederick
Davies, Dr. Ernest (Stretford)	Hynd, John	Neal, Harold
Davies, Harold (Leek)	Irvine, Sir Arthur (Edge Hill)	Newens, Stan
Davies, Ifor (Gower)	Jackson, Peter M. (High Peak)	Oakes, Gordon
Davies, S. O. (Merthyr)	Janner, Sir Barnett	Ogden, Eric
de Freitas, Fit. Hn. Sir Geoffrey	Jay, Rt. Hn. Douglas	O'Malley, Brian
Delargy, Hugh	Jeger, George (Goole)	Orbach, Maurice
Dell, Edmund	Jenkins, Rt. Hn. Roy (Stechford)	Orme, Stanley
Dempsey, James	Johnson, James (K'ston-on-Hull, W.)	Oswald, Thomas
Dewar Donald	Jones, Rt.Hn.Sir Elwyn(W.Ham, S.)	Owen, Dr. David (Plymouth, S'tn)
Diamond, Rt. Hn. John	Jones, J. Idwal (Wrexham)	Padley, Walter
Dickens, James	Jones, T. Alec (Rhondda, West)	Paget, R. T.
Dobson, Ray	Judd, Frank	Palmer, Arthur
Doig, Peter	Kelley, Richard	Pannell, Rt. Hn. Charles
Park, Trevor	Shaw, Arnold (Ilford, S.)	Watkins, David (Consett)
Parker, John (Dagenham)	Sheldon, Robert	Watkins, Tudor (Brecon & Radnor)
Parkyn, Brian (Bedford)	Shinwell, Rt. Hn. E.	Weitzman, David
Pavitt, Laurence	Short, Rt.Hn.Edward (N'c'tle-u-Tyne)	Wellbeloved, James
Pearson, Arthur (Pontypridd)	Short, Mrs. Renée (W'hampton, N.E.)	Wells, William (Walsall, N.)
Peart, Rt. Hn. Fred	Silkin, Rt. Hn. John (Deptford)	Whitaker, Ben
Pentland, Norman	Silverman, Julius	White, Mrs. Eirene
Perry, Ernest G. (Battersea, S.)	Skeffington, Arthur	Whitlock, William
Perry, George H. (Nottingham, S.)	Slater, Joseph	Wilkins, w. A.
Price, Christopher (Perry Barr)	Small, William	Willey, Rt. Hn. Frederick
Price, Thomas (Westhoughton)	Spriggs, Leslie	Williams, Alan (Swansea, W.)
Price, William (Rugby)	Steele, Thomas (Dunbartonshire, W.)	Williams, Clifford (Abertillery)
Probert, Arthur	Stonehouse, Rt. Hn. John	Williams, Mrs. Shirley (Hitchin)
Rankin, John	Strauss, Rt. Hn. G. R.	Willis, Rt. Hn. George
Rees, Merlyn	Swain, Thomas	Wilson, Rt. Hn. Harold (Huyton)
Reynolds, Rt. Hn. G. W.	Swingler, Stephen	Wilson, William (Coventry, S.)
Roberts, Rt. Hn. Goronwy	Symonds, J. B.	Winnick, David
Roberts, Gwilym (Bedfordshire, S.)	Taverne, Dick	Woodburn, Rt. Hn. A.
Robinson, Rt.Hn.Kenneth (St.P'c'as)	Thomson, Rt. Hn. George	Woof, Robert
Robinson, W. O. J. (Walth'stow, E)	Thornton, Ernest	Wyatt, Woodrow
Rodgers, William (Stockton)	Tinn, James	Yates, Victor
Roebuck, Roy	Tomney, Frank
Rogers, George (Kensington, N.)	Urwin, T. W.	TELLERS FOR THE AYES:
Ross, Rt. Hn. William	Wainwright, Edwin (Dearne Valley)	Mr. Neil McBride and
Rowlands, E. (Cardiff, N.)	Walker, Harold (Doncaster)	Mr. J. D. Concannon.
Ryan, John	Wallace, George
NOES
Alison, Michael (Barkston Ash)	Farr, John	Legge-Bourke, Sir Harry
Allason, James (Hemel Hempstead)	Fisher, Nigel	Lewis, Kenneth (Rutland)
Astor, John	Fletcher-Cooke, Charles	Lloyd, Rt.Hn. Geoffrey (Sut'nC'dfield)
Atkins, Humphrey (M't'n & M'd'n)	Fortescue, Tim	Lloyd, Rt. Hn. Selwyn (Wirral)
Awdry, Daniel	Foster, Sir John	Longden, Gilbert
Baker, Kenneth (Acton)	Fraser, Rt.Hn.Hugh(St'fford & Stone)	Loveys, W. H.
Baker, W. H. K. (Banff)	Galbraith, Hn. T. G.	Lubbock, Eric
Balniel, Lord	Gibson-Watt, David	McAdden, Sir Stephen
Barber, Rt. Hn. Anthony	Gilmour, Ian (Norfolk, C.)	MacArthur, Ian
Batsford, Brian	Gilmour, Sir John (Fife, E.)	Macleod, Rt. Hn. Iain
Beamish, Col. Sir Tufton	Glyn, Sir Richard	McMaster, Stanley
Bell, Ronald	Godber, Rt. Hn. J. B.	Maddan, Martin
Bennett, Dr. Reginald (Gos. & Fhm)	Goodhart, Philip	Maginnis, John E.
Berry, Hn. Anthony	Goodhew, Victor	Marples, Rt. Hn. Ernest
Bessell, Peter	Gower, Raymond	Marten, Neil
Biffen, John	Grant, Anthony	Maudling, Rt. Hn. Reginald
Birch, Rt. Hn. Nigel	Grant-Ferris, R.	Mawby, Ray
Black, Sir Cyril	Grieve, Percy	Maxwell-Hyslop, R. J.
Blaker, Peter	Grimond, Rt. Hn. J.	Maydon, Lt.-Cmdr. S. L. C.
Boardman, Tom (Leicester, S.W.)	Gurden, Harold	Mills, Peter (Torrington)
Bossom, Sir Clive	Hall, John (Wycombe)	Mills, Stratton (Belfast, N.)
Boyd-Carpenter, Rt. Hn. John	Hall-Davis, A. G. F.	Miscampbell, Norman
Braine, Bernard	Hamilton, Michael (Salisbury)	Monro, Hector
Brinton, Sir Tatton	Harris, Frederic (Croydon, N.W.)	Montgomery, Fergus
Bromley-Davenport, Lt. -Col. SirWalter	Harrison, Col. Sir Harwood (Eye)	Morgan, Geraint (Denbigh)
Bruce-Gardyne, J.	Harvey, Sir Arthur Vere	Mott-Radclyffe, Sir Charles
Bryan, Paul	Harvie Anderson, Miss	Munro-Lucas-Tooth, Sir Hugh
Buchanan-Smith, Alick(Angus, N&M)	Hastings, Stephen	Murton, Oscar
Buck, Antony (Colchester)	Hawkins, Paul	Neave, Airey
Bullus, Sir Eric	Hay, John	Nicholls, Sir Harmar
Burden, F. A.	Heald, Rt. Hn. Sir Lionel	Noble, Rt. Hn. Michael
Campbell, B. (Oldham, W.)	Heath, Rt. Hn. Edward	Nott, John
Campbell, Gordon (Moray & Nairn)	Heseltine, Michael	Onslow, Cranley
Carlisle, Mark	Higgins, Terence L.	Orr-Ewing, Sir Ian
Channon, H. P. G.	Hill, J. E. B.	Osborn, John (Hallam)
Chichester-Clark, R.	Holland, Philip	Page, Graham (Crosby)
Clark, Henry	Hooson, Emlyn	Page, John (Harrow, W.)
Clegg, Walter	Hordern, Peter	Pearson, Sir Frank (Clitheroe)
Cooke, Robert	Hornby, Richard	Percival, Ian
Cooper-Key, Sir Neill	Howell, David (Guildford)	Peyton, John
Cordle, John	Hunt, John	Pink, R. Bonner
Corfield, F. V.	Hutchison, Michael Clark	Pounder, Rafton
Costain, A. P.	Iremonger, T. L.	Powell, Rt. Hn. J. Enoch
Craddock, Sir Beresford (Spelthorne)	Irvine, Bryant Godman (Rye)	Price, David (Eastleigh)
Crouch, David	Jenkin, Patrick (Woodford)	Prior, J. M. L.
Crowder, F. P.	Johnson Smith, G. (E. Grinstead)	Pym, Francis
Currie, G. B. H.	Jopling, Michael	Quennell, Miss J. M.
Dalkeith, Earl of	Kerby, Capt. Henry	Ramsden, Rt. Hn. James
Dance, James	Kershaw, Anthony	Rawlinson, Rt. Hn. Sir Peter
Dean, Paul (Somerset, N.)	Kimball, Marcus	Rees-Davies, W. R.
Deedes, Rt. Hn. W. F. (Ashford)	Kitson, Timothy	Renton, Rt. Hn. Sir David
Doughty, Charles	Knight, Mrs. Jill	Ridsdale, Julian
Eden, Sir John	Lambton, Viscount	Rippon, Rt. Hn. Geoffrey
Elliot, Capt. Walter (Carshalton)	Lancaster, Col. C. G.	Robson Brown, Sir William
Elliott, R.W.(N'c'tle-upon-Tyne, N.)	Lane, David	Rodgors, Sir John (Sevenoaks)
Errington, Sir Eric	Langford-Holt, Sir John	Rossi, Hugh (Hornsey)

Royle, Anthony	Temple, John M.	Wells, John (Maidstone)
Russell, Sir Ronald	Thatcher, Mrs. Margaret	Whitelaw, Rt. Hn. William
Scott, Nicholas	Thorpe, Rt. Hn. Jeremy	Williams, Donald (Dudley)
Sharpies, Richard	Tilney, John	Wills, Sir Gerald (Bridgwater)
Shaw, Michael (Sc'b'gh & Whitby)	Turton, Rt. Hn, R. H.	Wilson, Geoffrey (Truro)
Silvester, Frederick	van Straubenzee, W. R.	Winstanley, Or. M. P.
Sinclair, Sir George	Vaughan-Morgan, Rt. Hn. Sir John	Wood, Rt. Hn. Richard
Smith, Dudley (W'wick & L'mington)	Waddington, David	Woodnutt, Mark
Smith, John (London & W'minster)	Walker, Peter (Worcester)	Wright, Esmond
Speed, Keith	Walker-Smith, Rt. Hn. Sir Derek	Wylie, N. R.
Stainton, Keith	Wall, Patrick	Younger, Hn. George
Summers, Sir Spencer	Walters, Dennis
Tapsell, Peter	Ward, Dame Irene	TELLERS FOR THE NOES:
Taylor, Edward M.(G'gow, Cathcart)	Weatherill, Bernard	Mr. Jasper More and
Taylor, Frank (Moss Side)	Webster, David	Mr. Reginald Eyre.
Teeling, Sir William

Mr. Deputy Speaker

We now come to the first Government Amendment.

The Joint Parliamentary Secretary to the Ministry of Transport (Mr. Neil Carmichael)

We now come to Amendment No. 57, with which it may be convenient to the House to take Amendment No. 58—

Mr. Deputy Speaker

Order. We are now dealing with the Government Amendments on the white paper and not with Amendment No. 57. The Amendments with which we are now concerned are to the Bill itself.

Mr. Carmichael

I beg to move—[Interruption.]

Mr. Deputy Speaker

Has the hon. Gentleman moved the first of the Government Amendments or all of them?

Mr. Marsh

I wonder whether it would be for the advantage of the House if we took the Amendments en bloc on the last Motion, Mr. Deputy Speaker.

Mr. Deputy Speaker

If that is acceptable to the House, yes. Will the right hon. Gentleman now move the whole of the Amendments en bloc?

Mr. Marsh

Yes, Mr. Deputy Speaker.

Mr. Deputy Speaker

The Question is, That the Amendment be made.

Mr. Marsh

I am sorry, Mr. Deputy Speaker, but I think the Motion is, That the House doth disagree with the Lords in the said Amendment.

Mr. Deputy Speaker

Perhaps I might help the House on a point of procedure. We are now amending the Bill itself. We are no longer concerned at this moment with the Lords Amendments. This is a direct Amendment to the Bill, and the Question that I must put to the House is, That the Amendment be made.

Mr. Bessell

On a point of order, Mr. Deputy Speaker. Are you referring to the Amendments on the first page of the white paper, the Amendment in page 69, line 1, and so on? These are Amendments to Lords Amendment No. 56.

Mr. Deputy Speaker

We are dealing with the Amendment which is the second proposal on the white paper. They are not Amendments to the Lords Amendment because we have already deleted Clause 48. We are now proposing to make an Amendment to the original Bill. I call on the Minister to propose the first Amendment. If the House wishes—and I believe it does—to take all the Amendments to be debated together, after the debate I will put the first Amendment.

Mr. Bessell

Further to the point of order, Mr. Deputy Speaker. You said that the House had deleted Clause 48. With respect, that is not so. We have restored it.

Mr. Deputy Speaker

I beg pardon. The hon. Gentleman is perfectly correct. We have restored the Clause. We are now dealing with the Bill as it was before it went to another place. These Amendments are to Clause 48, but not to the Lords Amendment.

Mr. Marsh

I beg to move the following Amendment to the words so restored to the Bill, in page 69, line 1, after first 'persons', insert: 'and to sell to outside persons petrol, oil and spare parts and accessories for motor vehicles, and for that purpose to purchase any of those things'.

Amendment agreed to.

Further Amendments to the words so restored to the Bill agreed to:

In page 69, line 3, after 'and', insert: 'the Waterways Board shall have power to sell goods of any description to outside persons, whether or not persons using their waterways, at any place where persons using those waterways may require facilities for the purchase of those goods, and for that purpose to purchase any such goods; and'.

In line 8, leave out 'or subsection (6)' and insert: 'and other than the provisions of this subsection relating only to the Waterways Board'.

In line 39, leave out subsections (6) and (7).

In page 70, line 20, leave out 'or (6)'.

In line 29, leave out from beginning to first 'to' in line 31 and insert: subsection (2) (which relates to the powers of the Waterways Board'.—[Mr. Carmichael.]