§ Mr. MillanI beg to move Amendment No. 90, in page 109, line 48, at end insert: 1832
'(1A) An order may provide for the repayment by any person who has supplied the goods or services specified or described in the order (the supplier) to any person who has purchased such goods or services (the purchaser) of such sums as the Minister may consider appropriate to compensate the purchaser for excessive prices charged for such goods or services by the supplier'.Schedule 7 deals with the various powers of the Minister on receipt of a Monopolies Commission report. The amendment provides that an order made on receipt of such a report could contain a power to compel the monopolist concerned to repay excess profits which he has made from the unfair exercise of his monopoly. It does not require a great deal of perception to see that this amendment is not unconnected with the recent Monopolies Commission report on Roche.I shall not develop the point at any great length. It is one of the unsatisfactory features of the present situation and it has been well demonstrated by the recent report on Roche that there is no power to recover money which may have been obtained by the monopolist from an undue exercise of his monopoly power. We get the rather disagreeable spectacle of the Government having to attempt to negotiate with such a firm repayments in compensation for excessive prices charged for such drugs over a period of years when it has already been made clear by the company that it has no intention of repaying anything.
The Roche case is unusual in a number of respects, the particular respect in this context being that the National Health Service—and, therefore, the taxpayer— was the main purchaser of the goods concerned. If this amendment were approved it would be comparatively easy to estimate and obtain the necessary refunds to for the excessive prices charged. In other circumstances it might be a much more complicated operation. I would point out that other countries adopt a much tougher financial line with monopolists who have been found to abuse their monopoly power. Sometimes it is done by the imposition of very considerable fines, running into hundreds of thousands of pounds; sometimes it may be done in certain circumstances by providing for the repayment of excess prices charged.
In this country, on the whole we have adopted a far too passive rôle towards 1833 monopolies and, having found abuses to be proved, we are not sufficiently aggressive in the actions we take. The Roche report is to some extent an exception to the rule, because it was an unusual report in which the power to reduce the prices was recommended and has been used by the Government, and we fully support them in this situation. But it is still true that in the Roche case a substantial sum of money—millions of pounds—is involved in excessive prices charged directly to the taxpayers through the National Health Service over a period of years, and there is literally nothing in our monopolies legislation even to allow a legal attempt to recover that money.
This is a serious defect in our monopolies legislation. I would not pretend that the amendment, even if it were technically proficient and effective, would be sufficient to do the job which has to be done. But I think that the Roche case emphasises the necessity for filling this gap in our legislation. We should now adopt the principle—this would only follow from a report of the Monopolies Commission, so there would be no question of the Government thinking something up for themselves and using the power without a recommendation—of making provision for the recovery of compensation from the monopolist for excessive prices charged in the past and for the abuse of monopoly power.
The purpose of the amendment is to raise the principle now at this very late stage of the Bill. Even if the amendment itself may not technically be sufficient to achieve the purpose I have in mind, it is very important that we should raise the principle, which is one that we should try, despite the difficulties in the way, to write into our monopolies legislation.
§ Mr. EmeryIn contrast with the last amendment, I have considerable sympathy with the expression of view by the hon. Member for Glasgow, Craigton (Mr. Millan) in the concept he has just argued. The amendment would widen the scope of the powers which may be exercised under Clauses 56 and 72 following an adverse report from the Monopolies Commission. The powers suggested are very extensive. They would enable an order to be made requiring the supplier who had charged excessive prices to compensate the purchaser.
1834 Obviously, as the hon. Gentleman said, closely in our minds is the scandalous overcharging we have seen in the Roche case. But I think we have to make it clear that any amendment to this Bill would have no effect on what had happened prior to the Bill. That follows the principle which the Labour Government adopted in the 1965 Act when they took powers of divestment.
There are considerable practical difficulties in using a power of this kind, when more than a few buyers are involved. In the Roche case it is more simple. In the case of many other monopoly reports, on grounds of practicability such a power could not be operated sensibly, especially if there were millions of claims from individuals who might have dealt with, or traded in, the product which the Monopolies Commission had considered.
9.45 p.m.
The hon. Gentleman stressed that monopoly legislation outside this country was, in certain instances, stronger and firmer than our own. I suggest that he looks at this fairly closely because in many instances it is not really operating. As regards the monopolies legislation in America, its application is much less effective and certainly much less respected than is the case in Great Britain.
However, I do not want to suggest that I am closing my mind to, or debarring myself from, the possibility of thinking further on the line of compensation when I say that I cannot, at this late stage of the Bill, accept the amendment. I have made it clear that we would want to look in depth at the practicalities of being able to do this. Therefore, even without a more positive response from the Government, the hon. Gentleman may be pleased that he put down the amendment.
§ Mr. MillanIt is rather pleasant since this is the last amendment I shall move to the Bill, to say that that has been a most helpful reply from the Under-Secre-tary. I am glad he accepts the seriousness of the situation and that the Government are willing to look at it.
As I made clear in my remarks in moving the amendment, I did not believe that our proposal by itself could possibly suffice to do the job. The point definitely requires to be aired. If the Roche report had come two months ago, when we were 1835 in the middle of our Committee stage, we might then have made considerable attempts to produce something much more sophisticated than this amendment to see whether the matter could be dealt with.
It may be that in another place, when the Bill gets there, there will be an attempt to deal with this situation in a better way than that provided by the amendment. It is a matter of considerable difficulty.
I am grateful to the Under-Secretary for saying that the Government are considering the matter. On that basis, I beg to ask leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.