HC Deb 03 August 1976 vol 916 cc1475-84

5.15 p.m.

Mr. Ian Gow (Eastbourne)

I beg to move, That leave be given to bring in a Bill to restore the National Bus Company and its subsidiaries to private ownership. The National Bus Company was formed on 28th November 1968, under the provisions of the Transport Act of that year, which was introduced by the then Labour Government. On 1st January 1969 the NBC took over the assets and shareholdings in England and Wales held previously by the Transport Holding Company. All the shares in NBC are owned by the Government, but the Minister appoints the directors.

Section 41(2) of the Transport Act 1968 places a duty on the company to break even financially, taking one year with another, after account is taken of local authority revenue support contributions, yet last year—the year ending 31st December 1975—the company made a record loss of £19 million, while its debt increased by £22 million, from £99.6 million to £121.6 million. During the same year the number of passenger journeys fell by 137 million and the number of bus miles operated fell by 2 million, yet the number of staff employed by the company increased by 887—from 69,574 to 70,461.

Since the company was formed it has made a profit in only three out of seven years. In each of the other four years there has been a loss. Over the past seven years total losses have exceeded profits by £31.4 million—and this despite fuel duty rebates, revenue support and other central and local government grants amounting to £122.1 million over the seven-year period.

At the time when the Transport Act 1968 was going through the House my Conservative colleagues predicted that the target of being able to break even financially would not be met. The Government, and notably the Minister—and we are delighted to see the Minister for Transport present—seem to believe that they can suspend economic laws and that by virtue of an Act of Parliament or ministerial edict, a system that is inherently unsound and unprofitable— namely, nationalisation—can be made to work.

In the House on 3rd December last, in answering a Question by my hon. Friend the Member for Blaby (Mr. Lawson), the Minister said …I think that the National Bus Company does an admirable job in extremely difficult circumstances."—[Official Report, 3rd December 1975; Vol. 901, c. 1668.] That was a ludicrous comment to make, just four weeks before the end of the worst-ever financial year for the company.

The Minister's admiration for the company is not reciprocated. In the annual report submitted to the Secretary of State on 7th June, the chairman wrote: There is also great uncertainty about transport policy, which the publication of the Government's Consultation Document has naturally not resolved. I wish to draw the Minister's attention to the use of the word "naturally". Earlier in that report there appeared the following apologia: As the company is State-owned, the question of loans from and interest due to the Treasury is merely a matter of public funds being passed from one pocket to another. Nevertheless, this apparently purposeless loading of overhead charges on to an already finely balanced operating economy, must have a depressing effect on morale of the management when they are striving desperately to fulfil their financial duty of breaking even. It would be wrong to blame the 70,000 employees of the compny for the fact that there is growing public dissatisfaction with the spiralling costs, the diminishing quality and the growing debt burden, which are the three basic ingredients of public ownerships. Those employees—all 70,000 of them—are the helpless victims of a system for which they themselves have increasing contempt.

The company is wholly unresponsive to the rapidly changing transport needs of the public. Overmanning, waste and the corroding influence of a virtual monopoly in the provision of bus services have provided the public and the taxpayer with the inevitble twin evils of nationalisation—an inadequte service and a growing financial burden. Only free enterprise responsive to the needs of the customer and determined to operate at a profit, can provide the necessary innovation and financial disciplines which are a precondition for success.

Would it be possible, at this stage, to find purchasers for the NBC, for its 95 subsidiaries, for the 20,000 buses and the premises throughout the country, owned at present by the State? It would, but we need to act quickly.

In a Written Answer on 20th July 1976, the Minister confirmed that at 31st December 1975 the net assets of the NBC and its subsidiaries exceeded liabilities by £25 million, but another 18 months of losses on last year's scale would wipe out that surplus.

This radical reform of the structure of bus services needs to be accompanied by an equally radical change in the present licensing system, so that in future licences to operate bus services will be granted to all, provided only that the crucial safety provisions are complied with.

There is a further reason why this measure is important and urgent. We are told that the Secretary of State for Energy wants additional powers—this will endear him to the Labour Benches below the Gangway—in order to direct the managements of those industries for which he has responsibility—coal, gas, oil and electricity—to do what he says.

The nationalised industries suffer already not from too little political direction but from too much. The prospect of having still further ministerial intervention in running industries that should be run on commercial lines is another reason for introducing the Bill today.

In a Written Answer on 24th May 1976, the Financial Secretary to the Treasury stated that over the 10 years 1966–76 the private sector had paid £17,090 million in corporation tax and advance corporation tax. In the same answer the Minister disclosed that over the same period the amount of corporation tax paid by nationalised industry had been negligible. It is time the Labour Party understood that it is only out of the profitable sectors of industry that money can be made available to finance the social services. A denationalised profit-making bus industry would not only remove the need for the taxpayer to subsidise that industry, but would mean that the profit-making companies would contribute additional revenue to the national Exchequer.

The Transport Act 1968 not only set up the National Bus Company; it set up the National Freight Corporation, which last year made a record loss of £31 million. That, too, is an ideal candidate for denationalisation, and I shall be seeking leave to introduce a Bill for that purpose on 26th October. But today is not "National Freight Corporation Day". It is "National Bus Company Day". The House has the opportunity to release the National Bus Company from the paralysing control of the Minister and of the bureaucracy, to liberate the taxpayer from further subsidies and losses, and to give to the public that quality and choice of service which only free enterprise and the market economy can provide.

5.23 p.m.

Mr. Kevin McNamara (Kingston upon Hull, Central)

It may be helpful if I first declare my interest. I am the parliamentary secretary of the Transport and General Workers' Union group in the House, many of whose members are employed in the National Bus Company, where, I believe, we have over 75 per cent. of the membership, both of the platform staff and inside.

I listened with interest to the speech of the hon. Member for Eastbourne (Mr. Gow). He said nothing about bus users. He said nothing whatsoever about the changes that have taken place in our society over the past 10 years. He said nothing about the need to subsidise areas in our community that would be completely without any form of local transport service if we did not have the National Bus Company.

We heard from the hon. Gentleman a completely heartless speech, which showed no realisation of the problems of many people in constituencies that his hon. Friends represent. I refer to people who live in remote villages, to those who live away from the railway lines and from the main roads in this country. I refer to those who do not possess cars. The bus users are among the less-well-off sections of our community.

It is of these people that we are talking in regard to maintaining a National Bus Company in public ownership. The one certain thing is that if we leave it to private operators, seeking profit, the remote villages in Humberside, for example, will never be served by any bus service whatsoever.

The history of private enterprise bus services before 1968 was one of application after application to traffic commisioners, asking for fares to go up. When the fares went up, the bus services lost custom. When they lost custom they applied to discontinue the service. This happened throughout wide areas of the country. These areas have become depopulated. They are now areas in which retired people have their homes—people who bought a nice little cottage in the country. Whole villages are comprised of retired persons with cars. This has taken the life from the countryside and from our rural communities. The people who formerly lived there have been priced out of living in these areas as a result of the lack of cheap public transport.

This regrettable situation is still continuing—I say this to my hon. Friends on the Front Bench—because of increasing transport costs and because the Government have not faced the problem. Not even in the consultative document have the Government faced the need to have a properly integrated transport policy. There is a bias in it, which one wants to see altered considerably. That bias, if I may say so in opposing the Bill, is in favour of roads, but it is not a bias in favour of the country roads and the rural road user.

The hon. Gentleman spoke in terms of overmanning in the bus industry. I should like to see where that overmanning is to be found. Time and time again my union has seen and co-operated in a reduction in platform staff. It has seen a reduction in the number of people used in the operation of these services, following the introduction of the one-man bus, the OMO. These buses have helped to stem the losses in the industry. Considerable time, energy and effort has been spent in my union members assuming further responsibilities in order to try to make the industry and the company more efficient.

The hon. Gentleman did not have the good fortune to be in the House at the time when the Transport Bill was going through in 1968. I do not blame him for that. Many are called, but few are chosen. But, had he been present during the passage of that Bill, he would have recalled the high hopes that the Labour Party entertained for the implementation of a properly integrated form of transport services.

It was regrettable that my right hon. Friend the Member for Huyton (Sir H. Wilson) called a General Election in June 1970. Probably nobody regrets it more than my right hon. Friend himself. The truth is that the impetus towards an integrated transport policy died after June 1970.

We want to get back to the common ideal that we all share on the Labour Benches, of having a proper system of transport, which considers the needs of the community as a whole and is not related to the quick buck and the quick profit. We want a bus system that is aimed at serving the pensioners, so that they can do their shopping. We want a bus system that ensures that children can get to school. We want a bus system that will not only maintain but revitalise life in the rural areas.

We want a National Bus Company that is not only publicly owned but is also properly integrated into a national transport system, so that instead of being afraid of subsidies we shall glory in them, because we shall ensure that we have efficient basic industries, financed out of public expenditure. Only in that way will private industry ever be able to make any sort of profit.

I oppose the Bill.

Question put, pursuant to Standing Order No. 13 (Motions for leave to bring in Bills and nomination of Select Committees at commencement of Public Business):

The House divided: Ayes 121, Noes 184.

Division No. 309.] AYES [5.30 p.m.
Adley, Robert Bottomley, Peter Clark, William (Croydon S)
Atkins, Rt Hon H. (Spelthorne) Bowden, A. (Brighton, Kemptown) Clarke, Kenneth (Rushcliffe)
Awdry, Daniel Brittan, Leon Cooke, Robert (Bristol W)
Banks, Robert Brotherton, Michael Cope, John
Beith, A. J. Buchanan-Smith, Alick Crouch, David
Benyon, W. Buck, Antony Dean, Paul (N Somerset)
Berry, Hon Anthony Budgen, Nick Dodsworth, Geoffrey
Biffen, John Carlisle, Mark Douglas-Hamilton, Lord James
Biggs-Davison, John Chalker, Mrs Lynda Dunlop, John
Durant, Tony Knight, Mrs Jill Rifkind, Malcolm
Dykes, Hugh Lamont, Norman Roberts, Michael (Cardiff NW)
Eden, Rt Hon Sir John Lawrence, Ivan Ross, William (Londonderry
Edwards, Nicholas (Pembroke) Lester, Jim (Beeston) Rost, Peter (SE Derbyshire)
Elliott, Sir William Lewis, Kenneth (Rutland) Royle, Sir Anthony
Farr, John McCrindle, Robert Scott-Hopkins, James
Finsberg, Geoffrey Madel, David Shaw, Giles (Pudsey)
Fletcher, Alex (Edinburgh N) Marshall, Michael (Arundel) Shersby, Michael
Fletcher-Cooke, Charles Marten, Neil Silvester, Fred
Freud, Clement Mates, Michael Sims, Roger
Gardiner, George (Reigate) Mather, Carol Smith, Cyril (Rochdale)
Gardner, Edward (S Fylde) Maxwell-Hyslop, Robin Smith, Dudley (Warwick
Goodhart, Philip Mayhew, Patrick Spicer, Michael (S Worcester)
Goodhew, Victor Miller, Hal (Bromsgrove) Sproat, lain
Gray, Hamish Mills, Peter Stanley, John
Griffiths, Eldon Moate, Roger Steel, David (Roxburgh)
Grlmond, Rt Hon J. Molyneaux, James Steen, Anthony (Wavertree)
Grist, Ian Montgomery, Fergus Stradling Thomas, J.
Grylls, Michael Morris, Michael (Northampton S) Tebbit, Norman
Hamilton, Michael (Salisbury) Morrison, Hon Peter (Chester) Thorpe, Rt Hon Jeremy (N Devon)
Havers, Sir Michael Newton, Tony Trotter, Neville
Hayhoe, Barney Osborn, John Vaughan, Dr Gerard
Heseltine, Michael Page, Rt Hon R. Graham (Crosby) Walker-Smith, Rt Hon Sir Derek
Higgins, Terence L. Pardoe, John Wall, Patrick
Hunt, David (Wirral) Pattie, Geoffrey Warren, Kenneth
Hurd, Douglas Pink, R. Bonner Weatherill, Bernard
Hutchison, Michael Clark Powell, Rt Hon J. Enoch Winterton, Nicholas
James, David Price, David (Eastleigh) Wood, Rt Hon Richard
Jenkin, Rt Hon P. (Wanst'd & W'df'd) Prior, Rt Hon James
Jessel, Toby Rathbone, Tim TELLERS FOR THE AYES:
Johnston, Russell (Inverness) Rees-Davies, W. R. Mr. Ian Gow and
Kershaw, Anthony Renton, Rt. Hon Sir D. (Hunts) Mr. Nigel Lawson.
Kimball, Marcus Rhys Williams, Sir Brandon
Allaun, Frank Ellis, John (Brigg & Scun) McDonald, Dr Oonagh
Anderson, Donald English, Michael MacFarquhar, Roderick
Ashton, Joe Ennals, David MacKenzie, Gregor
Atkins, Ronald (Preston N) Evans, Fred (Caerphilly) McNamara, Kevin
Atkinson, Norman Evans, loan (Aberdare) Madden, Max
Bagier, Gordon A. T. Flannery, Martin Magee, Bryan
Barnett, Guy (Greenwich) Fletcher, L. R. (Ilkeston) Marks, Kenneth
Bates, Alf Foot, Rt Hon Michael Marshall, Dr Edmund (Goole)
Benn, Rt Hon Anthony Wedgwood Forrester, John Marshall, Jim (Leicester S)
Bennett, Andrew (Stockport N) Fowler, Gerald (The Wrekin) Maynard, Miss Joan
Bidwell, Sydney Freeson, Reginald Meacher, Michael
Blenkinsop, Arthur Garrett, John (Norwich S) Mendelson, John
Boothroyd, Miss Betty Gilbert, Dr John Mlkardo, Ian
Boyden, James (Bish Auck) Ginsburg, David Miliar,, Bruce
Brown, Hugh D. (Provan) Golding, John Miller, Dr M. S. (E Kilbride)
Brown, Ronald (Hackney S) Gourlay, Harry Miller, Mrs Millie (llford N)
Buchan, Norman Graham, Ted Mitchell, R. C. (Soton, Itchen)
Buchanan, Richard Grant, George (Morpeth) Moorman, Eric
Butler, Mrs Joyce (Wood Green) Grant, John (Islington C) Morris, Alfred (Wythenshawe)
Callaghan, Jim (Middleton & P) Hamilton, James (Bothwell) Morris, Charles R. (Openshaw)
Cant, R. B. Hamilton, W. W. (Central Fife) Mulley, Rt Hon Frederick
Carmichael, Neil Hardy, Peter Newens, Stanley
Carter-Jones, Lewis Harper, Joseph Noble, Mike
Cartwright, John Harrison, Walter (Wakefield) Oakes, Gordon
Castle, Rt Hon Barbara Hart, Rt Hon Judith Ogden, Eric
Cocks, Michael (Bristol S) Hatton, Frank Orme, Rt Hon Stanley
Cohen, Stanley Healey, Rt Hon Denis Owen, Dr David
Coleman, Donald Heffer, Eric S. Park, George
Colquhoun, Ms Maureen Hooley, Frank Parker, John
Conlan, Bernard Howell, Rt Hon Denis (B'ham, Sm H) Parry, Robert
Cook, Robin F. (Edin C) Huckfield, Les Pavitt, Laurie
Corbett, Robin Hughes, Rt Hon C. (Anglesey) Peart, Rt Hon Fred
Cox, Thomas (Tooting) Irving, Rt Hon S. (Dartford) Pendry, Tom
Crawshaw, Richard Jackson, Miss Margaret (Lincoln) Panhaligon, David
Crowther, Stan (Rotherham) Jay, Rt Hon Douglas Perry, Ernest
Cryer, Bob Jeger, Mrs Lena Price, C. (Lewistiam W)
Cunningham, Dr J. (Whiten) Jenkins, Hugh (Putney) Price, William (Rugby)
Dalyell, Tam Johnson, James (Hull West) Richardson, Miss Jo
Davidson, Arthur Jones, Barry (East Flint) Roberts, Gwilym (Cannock)
Davis, Clinton (Hackney C) Jones, Dan (Burnley) Robinson, Geoffrey
Dempsey, James Kerr, Russell Rodgers, George (Chorley)
Dormand, J. D. Kilroy-Silk, Robert Rooker, J. W.
Douglas-Mann, Bruce Lamborn, Harry Roper, John
Duffy, A. E. P. Latham, Arthur (Paddington) Rowlands, Ted
Dunnett, Jack Lee, John Sandelson, Neville
Dunwoody, Mrs Gwyneth Llpton, Marcus Shaw, Arnold (llford South)
Eadie, Alex Litterick, Tom Shore, Rt Hon Peter
Edge, Geoff Lomas, Kenneth Short, Rt Hon E. (Newcastle C)
Edwards, Robert (Wolv SE) Loyden, Eddie Short, Mrs Renée (Wolv NE)
Silkin, Rt Hon John (Doptford) Thomas, Ron (Bristol NW) White, Frank R. (Bury)
Silkin, Rt Hon S. C. (Dulwich) Thorne, Stan (Preston South) Whitehead, Phillip
Silverman, Julius Tinn, James Williams, Rt Hon Shirley (Hertford)
Skinner, Dennis Tomlinson, John Wilson, Alexander (Hamilton)
Small, William Torney, Tom Wilson, William (Coventry 9E)
Snape, Peter Tuck, Raphael Wise, Mrs Audrey
Spearing, Nigel Urwin, T. W. Woodall, Alec
Spniggs, Leslie Wainwright, Edwin (Dearne V) Wrigglesworth, Ian
Stallard, A. W. Walker, Harold (Doncaster) Young, David (Bolton E)
Stoddart, David Walker, Terry (Kings wood)
Strang, Gavin Ward, Michael TELLERS FOR THE NOES
Summerskill, Hon Dr Shirley Watkins, David Mr. Neil Kinnock and
Taylor, Mrs Ann (Bolton W) Watkinson, John Mr. Bruce Grocott.
Thomas, Dafydd (Merioneth) Weitzman, David

Question accordingly negatived.