HC Deb 29 November 1973 vol 865 cc725-32

Question proposed, That the clause stand part of the Bill.

Mr. Palmer

I shall not detain the Committee for too long since no amendments have been tabled to the clause. Nevertheless I do not believe that we should let it go without a little discussion.

I remember the night in this House when the old Ministry of Power was foully murdered. I regret to say that it was done by my right hon. and hon. Friends, and I was about the only hon. Member to mourn its passing. I thought it was a mistake and I still do, though possibly there may be some resurrection process eventually.

At present we have a vast organisation known as the Department of Trade and Industry looking after almost everything from packets of tea to reactors. When that happens, it seems to me that we lose a great deal of detail.

The clause is a very good example of what I mean. It deals with documents and information. With a scheme of control as wide as the one we are discussing, obviously a great many documents and forms will be involved. I feel that the clause is too vaguely drafted and that the Committee is entitled to a little more detail about the directions likely to be given, the documents which will be required to be kept and the information that will be required.

I assume that these provisions will apply largely to garages and petroleum undertakings of various kinds. But theoretically it could apply to the nationalised industries—to electricity supply, to the Gas Corporation—and presumably it could have some reference to stocks of uranium which are held by the Atomic Energy Authority. One would think that already, under various statutory provisions, ample returns are made. I should like to know whether the Minister for Industry feels that this requirement will be fairly simple or intensely complicated.

I make my protest. I think that a clause of this kind should not be so widely drawn. No doubt we shall eventually get the information in the regulations, if we have the time to study them. However, I believe that the clause should specify far more detail.

10.30 p.m.

Mr. Biffen

I should like to add a few remarks to those made by the hon. Member for Bristol, Central (Mr. Palmer). I still believe that the clause that we have already adopted regarding the regulating of prices will be applied in such a way that the Price Commission will be rendered obsolete on oil prices and that in reality—at least up to 30th November 1974—the Secretary of State will be directly involved in adjudicating and co-ordinating the permitted price increases. If so, I should like to know whether the documents and information required under Clause 3 will be significantly different from the documentation that has to be supplied currently to the Price Commission.

I have a feeling that what is at stake is something very much wider than might at first sight seem likely. I suspect that the intention is that the Secretary of State will replace the Price Commission, not for the fairly narrow and restricted instances referred to by my hon. Friend the Under-Secretary of State, who was perfectly accurate and most helpful in identifying those instances where Clause 2(1)(b) could be applied, but on a wider basis. It is legitimately open to the Committee to assume that the powers will be used on such a wide basis that the Secretary of State will effectively replace the Price Commission on the co-ordination of permitted price increases. After all, a great many oil price increases relate to the co-ordination of a market structured in such a way. I say this in the absence of my hon. Friend the Member for Horsham (Mr. Hordern), who may take a mildly dissenting view, speaking with much more personal knowledge, whereas I speak as someone who looks at the matter, slightly cynically perhaps, from the periphery.

If so substantial an area of the economy as price control is to be transferred from one agency to the Government, we must know much more about it. We must know what documentation will be provided and, above all, the answerability for it to Parliament. At the moment we cannot even be told the number of notifications or volume of intended increases.

Mr. Geoffrey Finsberg

Quite right.

Mr. Bitten

My hon. Friend says "Quite right". Whether he is saying that it is a matter to be applauded that the House of Commons cannot even know the magnitude of applications or that it is the law being interpreted by the Minister, I know not.

Mr. Geoffrey Finsberg

The former.

Mr. Biffen

I do not think it is appropriate that such tremendous power should be vested in statutory bodies that subsequently are not answerable to Parliament in a satisfactory fashion. If we are to have a substantial change in the pattern, as I suspect, then the whole question of parliamentary accountability must be considered. What more appropriate circumstances for considering it than on the documents and information as set out in the clause?

The Committee is indebted to the hon. Member for Bristol, Central for raising this point. I hope that my hon. Friend the Minister will be able to give some further illumination of the Government's intentions in this direction.

Mr. Leadbitter

I apologise for the sound of my voice. The Minister, too, has a cold. Perhaps it is the penalty of working in this cold Chamber—our contribution to the national interest.

The hon. Member for Oswestry (Mr. Biffen) is much nearer the possibilities arising from the clause than the Government are prepared to tell us. I have been surprised at the approach to the process of producing the Bill and the question of rationing. On 24th October the Government announced information about our fuel stocks. The position then appeared to be much better than it was at the same period last year. On 13th November the Government took upon themselves emergency powers. These touched questions of control of display lighting and heating. Lo and behold, within less than a week, on 19th November, they announced 10 per cent. reductions on last year's consumption figures for fuel, for both industrial and private use.

We have had a kind of creeping approach to this problem. Hon. Members on both sides of the House have had a more realistic view about the matter in that they have asked for more pertinent action.

I come to the question raised about Clause 2(1)(b), and to what the Minister meant about Clause 4. Both instances are revealing. The Minister said, referring to Clause 2, This provides a more flexible means of controlling oil prices. But when referring to Clause 4 the Secretary of State said The purpose of Clause 4 is to enable us to be tougher and far more quickly to apply price control to the retail outlets. In two answers, therefore, we have one for the basis of flexibility and the other for control.

Now we come to Clause 3, where we might have felt a rigidity of documentation and, indeed, a wide area of documentation. I suspect that there is far more to it, with an overall objective of a more positive control, taking over, as it were, in the situation described by the hon. Member for Oswestry. It is for these reasons that the Minister should tell the Committee whether what is meant by Clause 3 is what the Secretary of State said : Clause 3 enables the Secretary of State to require the keeping of records and the furnishing of information by any undertaking relating to the substances covered by the Bill."—[OFFICIAL REPORT, 26th November 1973 ; Vol. 865, c. 45, 59, 46.] The Bill may not operate ; there may be no rationing. The first steps have been taken in issuing ration cards, but the Bill will have a life of only one year, when it will have, to be resuscitated by Order in Council. So there is no commitment to rationing, nothing firm has been said about the gravity of the situation, and there may even be some relaxation.

If the clause is operated, we may have to impose extra documentation on a large number of suppliers and producers, on top of their normal commercial and accounting documentation. The country, already under the stresses and strains of uncertainty, would face the prospect of a situation which might never materialise.

Does this provision refer only to the Bill and nothing else or has it something to do with the fears mentioned by the hon. Member for Oswestry?

Mr. Tom Boardman

The short answer to the hon. Member for Bristol, Central (Mr. Palmer) is that exactly the same provisions as are contained in this Bill appeared in the 1967 Act, which he, along with the rest of the House, supported. It is not unusual, indeed it is essential when the House takes powers to regulate the substances which are covered by the Bill, to require that the necessary information is made available, the necessary documents are kept and the necessary inspection is provided for, so that the provisions can be policed.

I share the hon. Member's concern about unnecessary form-filling and I would deplore the unnecessary keeping of statistics, but the clause is intended to enable the control of fuel to be properly operated. Without such provision for information, that could not be done, as was recognised in 1967.

With his usual ingenuity, my hon. Friend the Member for Oswestry (Mr. Biffen) raised the same point as he had raised on the previous clause, which was answered by my hon. Friend. He clearly did not appreciate the circumstances in which the control of price would be not only desirable but essential. If the Secretary of State had to direct supplies to go to a particular consumer without the power to attach a price tag, the supplier could agree to supply but only at a price which would defeat the object of the direction.

10.45 p.m.

Mr. Biffen

I am sure my hon. Friend is anxious to dispel any anxieties that I may have, and he can do so simply by saying whether in future the oil companies will notify the Price Commission and will then proceed to increase their prices unless they are told otherwise, which is the state of the law at the moment under the Counter-Inflation Act 1973, or whether they are more likely to be moving their prices in a form and pattern and rhythm determined after consultation with the Secretary of State, which seems to be fully implicit in Clause 2(1)(b).

Mr. Boardman

I remind my hon. Friend of what my right hon. Friend said on Second Reading, referring to flexibility : This provides a more flexible means of controlling oil prices in a scarcity situation than would be possible under the Counter-Inflation Act 1973. I particularly have in mind that it could be used without the waiting periods involved in the Counter-Inflation Act so far as retail outlet prices are concerned."—[OFFICIAL REPORT, 26th November, 1973 ; Vol. 8865, c. 45.] No doubt my right hon. Friend had particularly in mind, as I am sure my hon. Friend has, the sort of abuse which could quickly build up in a scarcity situation if prices at retail outlets were allowed to go up under the rather more distant control which would apply to the smaller retail outlets under the Counter-Inflation Act. There may well be circumstances—and it may be necessary to invoke these powers—where it would be just and right and fair to the consumer and to the industry as a whole that power should be taken to impose price control rapidly without waiting for the rather slower processes of the Counter-Inflation Act.

Mr. Leadbitter

I am in some difficulty. The hon. Gentleman is saying that, in comparison with the counter-inflation processes, both the price review and the realities and practicalities of operation for the oil companies, as described by the hon. Member for Oswestry (Mr. Biffen), will, under the Bill, be dealt with more quickly and flexibly. I know, and everyone has the feeling, that the likelihood is that the Bill will not become operative—we all hope so. If the object is more flexibility to deal with the matter more rapidly, why cannot the appropriate power be given under the counter-inflation policy to the Price Commission now?

Mr. Boardman

There is a great distinction between this transaction, in which the supplier has the choice of whether he supplies or does not supply, and the other situation, where the supplier may be directed to supply. In the latter case, if he is to be directed to supply, there must be a price, and it may have to be one of the component parts of the direction.

My hon. Friend the Member for Oswestry approached this from a rather different level—that of the oil companies and the prices which may be allowed and the effect that an artificially low price would have on their investment and, ultimately, on the energy resources of the country. That point is well recognised and well understood.

Mr. Biffen

This is a point of substance. I appreciate that the notification procedures are such that individual garages are not obliged to notify. One could, therefore, get a variety of prices being charged by individual garage retailers, and this might give rise to a situation which my hon. Friend would wish to curb under Clause 2(1)(b). What I am interested in, however, is the potential application of Clause 2(1)(b) to situations where, under the Counter-Inflation Act, there can be no doubt that proposed price increases will be notified. Here I am talking of the producers, not of individual garage retailers. In these circumstances the notification procedure means that after a delay the price increase could proceed unless it was otherwise specified.

The Secretary of State has taken powers to short-circuit that, we are told, and, far from restraining price increases, that enables them to take place at greater speed. That is a contradiction. Therefore, it is important that the Committee should know whether in future oil price increases from the producer companies, all of which will come under the notification procedure of the counter-inflation legislation, will be dealt with by the Secretary of State, which seems to me a perfectly reasonable interpretation and understanding of Clause 2(1)(b). That is an issue which should be resolved before the Bill finally reaches the statute book.

Mr. Boardman

The invoking of Clause 2(1)(b) will be a matter for my right hon. Friend but the intention was clearly expressed on Second Reading. It was that it would be invoked if and when necessary to get an effective implementation of the other provisions in the Bill. While it would be wrong for me to attempt to confine the scope of that clause, I should say that its emphasis and main overriding purpose is in the context of fixing prices where a direction on supply, at whatever level, involves requiring supplies to be made, and, therefore, in order that justice may be done, attaching a price tag to those supplies.

I hope that my hon. Friend the Member for Oswestry is not suggesting that I should attempt to confine the operation of the clause when it has a wider meaning. It is only right for me to explain the overriding purpose. The hon. Member for the Hartlepools (Mr. Leadbitter) raised a similar point but in a somewhat different context. I believe that what I have already said will adequately answer the point. I hope, therefore, that the clause will be agreed to.

Question put and agreed to.

Clause 3 ordered to stand part of the Bill

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