§ Amendment made: No. 1, in page 1, line 17, at end insert:
§ '(1A) Orders under subsection (1) above regulating or prohibiting the use of any of the substances mentioned in the subsection, or of electricity, may be made at any time but only where it appears to the Secretary of State to be desirable for the purpose of conserving energy.
§ Subject to this, orders under the subsection may be made only when an Order in Council under section 3 of this Act is in force.
§ (1B) When no Order in Council under section 3 is in force the Secretary of State shall before making an order under subsection (1) consult with organisations in the United Kingdom appearing to him to represent those who will be affected by the order, including both consumers and suppliers of energy, and such other organisations as he thinks appropriate.'.—[Dr. J. A. Cunningham.]
§ Dr. J. Dickson MabonI beg to move Amendment No. 2, in page 1, line 20, at end insert: 1708
'This power is exercisable at any time in the case of petroleum products, but otherwise is exercisable only when an Order in Council under section 3 is in force'.I think that I can be brief about this matter, although I do not deny that it is very important. We had a lengthy discussion in Committee about it. That was preceded by discussion in the other place on a similar matter. There is obviously a gulf of difference between the Government and the Opposition about the matter. I am sorry about that, because I do not believe that that difference ought to exist. I believe that it is based on a misunderstanding about intentions.It is not our intention immediately to introduce a permanent system of price controls on petroleum products or oil fuel products. That is the contention that has been made by Opposition Members from time to time. I acquit the hon. Member for Carshalton (Mr. Forman) of that. In Committee he said:
The Minister said that the Government were seeking only permanent reserve powers to 1709 control prices and not permanent price controls. He attached much importance to that distinction."—[Official Report, Standing Committee J, 29th June 1976; c. 133.]I certainly do. That is the distinction. We want reserve powers on these matters. It is not so that we shall have powers on everything, but we want to have the power for one specific reason or product. The example that I gave is the continuation on paraffin. If the amendment were lost, I should have to introduce a manuscript amendment at once to save the paraffin position. I am sure that I would get the acknowledgement of at least one Opposition Member. Although there is a division among Opposition Members. I know that the hon. Member for Carshalton, the hon. Member for Ross and Cromarty (Mr. Gray) and the hon. Member for Sutton and Cheam (Mr. Macfarlane) would support me in maintaining this specific control on paraffin prices, because it affects the old and the needy. As far as I know, no change was introduced by the Opposition in these matters.
§ Mr. John Biffen (Oswestry)The Minister of State says that paraffin consumption is largely in respect of the old and needy. Will he take some opportunity to place before the House an analysis that demonstrates that that is so?
§ Dr. MabonI cannot do that now, in the present circumstances, but I would welcome a chance to debate this matter. When we look at new orders as they come along, perhaps the Opposition will take the opportunity of opening up the debate on the matter. I shall certainly produce as much material as possible to justify that statement.
At present, if this amendment were lost, I should immediately ask your indulgence, Mr. Deputy Speaker, to move a manuscript amendment to save the control of the price of paraffin. In doing so I know that I should have the support of not only all of my hon. Friends but also some Opposition Members. I use that example not to embarrass the Opposition but simply to say that it is an example of having a permanent reserve power that is able to be exercised in particular circumstances that are justified to my hon. Friends and Opposition Members.
§ Mr. MacfarlaneOn that point, will the Minister undertake to tell us something that he neglected to clarify in Committee, in the hot days of June and July? Will he give a definition of an emergency and an emergency sub-crisis, which is germane to this point?
§ Dr. MabonI do not want to go into the semantics of what was a marvellous Committee stage, which I enjoyed tremendously. I want to rehearse the differences between us on the matter and get to the vote once and for all. I should certainly have to move a manuscript amendment if this amendment were lost.
One of the complaints that I have heard is that somehow or other the amendment is against consumers. It is said that somehow consumers do not want this control. I regard that as an Alice-in-Wonderland argument.
6.0 p.m.
I was asked whether I had heard from certain individuals, or from anyone, in favour of this proposition. I can tell the House that we have heard from the Brick Development Association about its position. It wants us to look into the question of the Government doing something about the control of prices as it affects the association. We have heard from the National Federation of Clay Industries using fuel oil, gas oil and liquid petroleum gas. The major airlines have made representations about cheaper fuel. The British Independent Steel Producers' Association has asked us to look into this matter. The horticulture and fishing industries have asked us to do so, and so have a number of ship repair companies. One specific one that I know of complained about bunker prices and asked us to look into that. That company claimed it was losing business because foreign ship owners were not willing to have their ships repaired in United Kingdom ports because the price of bunker fuel is higher than in most other European ports. I am not saying that all these complaints are justified, but if the Government were to take any one of those, either at the present time or in future when circumstances could have changed, we would have no power to do anything.
The Price Code cannot be used as an argument because it is a much blunter system than what is proposed here.
§ Mr. RostI have tried to follow the Minister closely. He is not asserting the arguments that he has given previously, namely, that these price controls are required in the interests of energy conservation. He has not directed his remarks to that argument. I wonder whether he could do so?
§ Dr. MabonI think that my hon. Friend the Member for Whitehaven (Dr. Cunningham) did quite well in the last debate. It was rather lengthy, but it was still worth while. I do not propose to rehearse what we have said before. I should explain to students of the Bill, who might do research on it in future, that my remarks tonight should be read with what I have said before.
What I would like to stress is the fact that we simply want reserve powers. I have established that we have at least one case which proves the need to have a precise power for a precise product. I agree that there are 3,000 of them, and I agree also that the Price Code system is not the mechanism to enable us to assert this.
The fourth reason is that the consumers want this and it is perfectly plain that they do. Fifthly, other countries have this power and use it. I am not denying that there could be abuses, but the fact is that the majority of those countries want to keep that system and have some right of reserve power for permanent control.
The argument that hon. Gentlemen opposite have used in Committee—no doubt the hon. Member for Ross and Cromarty will use it in his peroration—is that the Secretary of State for Energy is a wild man who rejoices in the abuse of powers given to him by Parliament and will willingly wreck the economy at the drop of a hat. I am simply putting in a nicer way the abusive language that hon. Gentlemen employed in this regard. We deny that absolutely.
My right hon. Friend has been quoted many times, and was quoted again tonight. He has been misrepresented. He said, on 26th November 1973:
It will give us the power"——the Tory Party's Bill, which would still be on the statute book if we were not putting this Bill on the statute book— 1712to control all the oil companies, all the multi-nationals, to fix their prices and their distribution systems; and under these powers every other fuel and its use, including the chemical industry, will be brought within the control of the Government of the day.That is the Tory Party. Later, he said, in the third sentence, which the hon. Member for Bedford (Mr. Skeet) had, but would not quote:The Bill will give the Government enormous powers—far greater than any powers we have ever suggested should be taken in the area of fuel and power.—[Official Report, 26th November 1973, Vol. 865, c. 141.]Who is the extremist? I suggest that the hon. Member for Bedford is the extremist. He wants to retain these powers, which we have not abused. The only power that we have exercised is the paraffin power. My right hon. Friend can hardly be accused of abusing powers either in theory or in practice.
§ Mr. SkeetThe 1973 Act was subject to annual review and therefore had to come before this House. Permanent price control powers are not to be reviewed annually. They would be permanent.
§ Dr. MabonBut they will be subject to debate in Parliament, as we know. HON. MEMBERS: "How?"] Procedurally and also in general debates. There has never been, in my experience of the steam hammer powers, an occasion when either Government—Conservative or Labour—has misused them. I cannot accept the argument that by diminishing the Government's reserve powers as proposed here, by limiting them to petroleum products, we open the way to abuses. With due respect to hon. Gentlemen opposite, I have considered this carefully once again and have found five very sound arguments why Amendment No. 2 should be made.
§ Mr. Hamish Gray (Ross and Cromarty)I was interested in what the Minister had to say and in his quotation. It is, perhaps, fitting that he has used that quotation for a change and not I. I would not have used it tonight in any event.
There is one small point I would make and that is if he is so anxious about paraffin why then does he not remove the words "petroleum products" in the amendment and insert the word "paraffin"? He would then probably have 1713 the support of quite a number of hon. Members on this side of the House. There may be some of my hon. Friends who would find it difficult to agree, but there are others, I am sure, who willingly would.
If the Minister insists on leaving in the words "petroleum products", then obviously we take exception to the amendment. One of the most disturbing features of the Bill, from the time when it was introduced in the other place, is the fact that it would give power to the Government to make orders regulating the price of petroleum products, exercisable at any time, including non-emergencies. That would put the oil industry in a state of being under permanent price control over and above the Price Code, by which it is already affected. The aims of the permanent price control, in a sense, seem awkwardly placed in the Bill. After all, the aims of the Bill are, surely, to provide emergency powers, to implement international agreements, and to promote conservation. It seems to us that that and price control do not go well together. These powers were removed by the Lords and the Government have twice attempted to replace them—once at the Report stage in the Lords and once in Committee in the Commons. One of our worries has been to obtain from the Minister—we have never got it—a positive definition of when these powers would be invoked.
I agree with the Minister that we had a successful Committee stage, particularly successful from our point of view. To give the Government credit, they met us on a number of matters. Indeed, the Bill as it is now is a vastly improved piece of legislation from that originally introduced in the Lords. That was due to the hard work of my noble Friends in another place, and to my right hon. and hon. Friends on this side of this House. Nevertheless, I would give credit where it is due, and, limited though it may be, we have to give it to the Government.
During Committee we tried several times to get a definition of what a sub-crisis is. Indeed, the former Under-Secretary said on 15th June:
It is envisaged that these powers would be used only if the Secretary of State needed to do so because of a state of shortage of fuel, oil and oil products. When hon. Members opposite complain about the conservation 1714 aspect here, I should point out to them that there is a difference between the economics of prudence and the economics of famine. It would be in circumstances of the economics of famine that this sort of thing would be brought in and there would be price control in this way."—[Official Report, 15th June 1976; Vol. 913, c. 404–5.]That is one definition, but it is difficult to accept this explanation because the Minister of State later gave us a description of the circumstances in which price control might be applied, and in the following terms, thata third degree of possibility, namely, a crisis which is not legally an international crisis or legally a domestic crisis in terms of the concept of the Bill, but something which is slightly less, but which is serious to the consumer."—[Official Report, Standing Committee J, 29th June 1976; c. 118.]People who will be affected by the Bill will find those definitions difficult to follow. The Minister at this late stage in the proceeedings on the Bill should be prepared to give us a more acceptable definition.
§ Mr. MacfarlaneIs my hon. Friend aware that in an article in the Financial Times this week the correspondent, Ray Dafter, said that the Minister
has indicated that powers might be needed for a 'sub-crisis' emergency"—that phrase we have heard so much in 1976—such as the local disruption of the normal market. One possible situation might be the wide variance of petrol prices between one geographical area and another"?We remember the price competition that has gone on throughout this season.
§ Mr. GrayMy hon. Friend has raised a good point which highlights the necessity for a specific definition.
There seems to be on the part of Government, intentionally or unintentionally, a decided discrimination against the oil industry, which is unique in being the subject of permanent price control. That is virtually what is happening. There is a marked difference between restraint and price control, and the oil industry has been accustomed to cooperating with successive Governments for a considerable time.
The oil industry cannot be compared with the nationalised industries, which are not subject to the same economic disciplines as are the oil companies. 1715 Many nationalised industries are monopolies and they do not have to compete to survive. Oil companies have to compete to survive, and this measure will seriously impair their future prospects.
Let us look back at the co-operation that the oil industry has achieved. In 1970 the industry was requested to give information two weeks in advance to the Department of Trade and Industry about proposed increases. It complied. That co-operation continued through 1971. An agreement with the CBI was signed in July 1971 covering the period until July 1972. Subsequently, the agreement was extended to 31st October 1972. All that was done by co-operation between the oil industry and the Government. The objects of the agreement between the CBI, the industry and the Government were principally to avoid increases, and, if increases were unavoidable, to limit them to 5 per cent. I give those instances to show how co-operative the industry has been over the years.
There is a great deal I should like to say, but we are pressed for time tonight and much of what I want to say has been touched on in Committee. I doubt whether at this late stage I shall get the Minister to change his mind, but there are several questions which should be asked. I hope that the Minister will be able to give us some guidance on these questions. If it is not possible for him to get all the answers conveyed to him quickly enough during the debate, he might be able to tell us something during the Third Reading debate.
6.15 p.m.
Are the Government prepared to give an assurance that they will not exercise simultaneously their general powers
§ under current prices legislation and the specific powers under the Bill? Do the Government envisage the Price Code being replaced by the price control powers in the Bill for petroleum products?
§ If, as I hope, the answers to those questions are "Yes" and "No" respectively, will the Government reaffirm the Under-Secretary of State's pledge given on Second Reading that these powers will be used only if the Secretary of State needs to use them because of a shortage of fuel, oil and oil products?
§ How do the Government envisage administering the price controls in the Bill? What plans have the Government to avoid price distortion by the exercise of their powers? Are they prepared to give an undertaking not to use these powers to discriminate between different companies?
§ I realise that these are far-reaching questions, and for that reason I do not expect the Minister to be able to answer them all immediately. I hope, however, that he will be able to reassure the industry by answers he will give me either now or during the Third Reading debate. He will use his parliamentary majority to get his amendment through—of that there is little doubt—but that will not remove the doubts and fears of the industry. It is important that the Minister should tell me that he is prepared between now and Third Reading seriously to think about this matter. He will have an hour or two to spare, and I hope that he will be able to give us reassuring answers.
§ Question put, That the amendment he made:—
§ The House divided: Ayes 154, Noes 129.
1717| Division No. 339.1 | AYES | [6.17 p.m. |
| Anderson, Donald | Carmichael, Neil | Deakins, Eric |
| Archer, Peter | Cartwright, John | Doig, Peter |
| Armstrong, Ernest | Castle, Rt Hon Barbara | Dormand, J. D. |
| Atkinson, Norman | Clemitson, Ivor | Douglas-Mann, Bruce |
| Bain, Mrs Margaret | Cocks, Rt Hon Michael (Bristol S) | Dunnett, Jack |
| Barrett, Fit Hon Joel (Heywood) | Cohen, Stanley | Edge, Geoff |
| Bates, Alf | Cook, Robin F. (Edin C) | Edwards, Robert (Wolv SE) |
| Bean, R. E. | Corbett, Robin | Ellis, John (Brigg & Scun) |
| Bidwell, Sydney | Cox, Thomas (Tooting) | English, Michael |
| Boothroyd, Miss Betty | Craigen, J. M. (Maryhill) | Ewing, Harry (Stirling) |
| Bottomley, Rt Hon Arthur | Crowther, Stan (Rotherham) | Ewing, Mrs Winifred (Moray) |
| Brown, Ronald (Hackney S) | Cryer, Bob | Faulds, Andrew |
| Buchan, Norman | Cunningham, Dr J. (Whiteh) | Fernyhough, Rt Hon E. |
| Buchanan, Richard | Davidson, Arthur | Fitch, Alan (Wigan) |
| Butler, Mrs Joyce (Wood Green) | Davies, Bryan (Enfield N) | Fletcher, L. R. (Ilkeston) |
| Campbell, Ian | Davis, Clinton (Hackney C) | Fowler, Gerald (The Wrekin) |
| Fraser, John (Lambeth, N'w'd) | MacKenzie, Gregor | Small, William |
| Freeson, Reginald | McMillan, Tom (Glasgow C) | Smith, John (N Lanarkshire) |
| Garrett, John (Norwich S) | Madden, Max | Spearing, Nigel |
| Gilbert, Dr John | Maynard, Miss Joan | Stallard, A. W. |
| Gourlay, Harry | Meacher, Michael | Stewart, Donald (Western Isles) |
| Graham, Tad | Mendeison, John | Stewart, Rt Hon M. (Fulham) |
| Grant, John (Islington C) | Millan, Rt Hon Bruce | Stoddart, David |
| Harper, Joseph | Miller, Dr M. S. (E Kilbride) | Strang, Gavin |
| Harrison, Walter (Wakefield) | Miller, Mrs Millie (Ilford N) | Summersklll, Hon Dr Shirley |
| Henderson, Douglas | Molloy, William | Taylor, Mrs Ann (Bolton W) |
| Hooley, Frank | Morris, Alfred (Wythenshawe) | Thomas, Ron (Bristol NW) |
| Horam, John | Morris, Rt Hon J. (Aberavon) | Thompson, George |
| Hoyle, Doug (Nelson) | Murray, Rt Hon Ronald King | Tinn, James |
| Hughes, Rt Hon C. (Anglesey) | Newens, Stanley | Tomlinson, John |
| Hughes, Robert (Aberdeen N) | Noble, Mike | Tuck, Raphael |
| Hughes, Roy (Newport) | Oakes, Gordon | Urwin, T. W. |
| Hunter, Adam | Orbach, Maurice | Varley, Rt Hon Eric G. |
| Irvine, Rt Hon Sir A. (Edge Hill) | Orme, Rt Hon Stanley | Wainwright, Edwin (Dearne V) |
| Irving, Rt Hon S. (Dartford) | Ovenden, John | Waiden, Brian (B'ham, L'dyw'd) |
| Jay, Rt Hon Douglas | Owen, R.I Hon Dr David | Walker, Terry (Kingswood) |
| Jeger, Mrs Lena | Palmer, Arthur | Watkinson, John |
| Jenkins, Hugh (Putney) | Park, George | Watt, Hamish |
| John, Brynmor | Parry, Robert | Weitzman, David |
| Jones, Dan (Burnley) | Prescott, John | White, Frank R. (Bury) |
| Kelley, Richard | Price, C. (Lewisham W) | White, James (Pollock) |
| Kerr, Russell | Radice, Giles | Whitlock, William |
| Kilroy-Silk, Robert | Rees, Rt Hon Merlyn (Leeds S) | Williams, Alan Lee (Hornch'ch) |
| Kinnock, Neil | Richardson, Miss Jo | Williams, Rt Hon Shirley (Hertford) |
| Latham, Arthur (Paddington) | Roberts, Gwilym (Cannock) | Williams. Sir Thomas (Warrington) |
| Lipton, Marcus | Rodgers, Rt Hon William (Stockton) | Wilson, Gordon (Dundee E) |
| Loyden, Eddie | Rooker, J. W. | Wilson, William (Coventry SE) |
| Lyons, Edward (Bradford W) | Ross, Rt Hon W. (Kilmarnock) | Wise, Mrs Audrey |
| Mabon, Dr J. Dickson | Ryman, John | |
| McCartney, Hugh | Sandelson. Neville | TELLERS FOR THE AYES: |
| MacCormick, Iain | Silkin, Rt Hon John (Deptford) | Mr. Tames Hamilton and |
| McDonald, Dr Oonagh | Silverman, Julius | Mr. Donald Coleman. |
| McElhone, Frank | Skinner, Dennis | |
| NOES | ||
| Atkins, Rt Hon H. (Spelthorne) | Hannam, John | Parkinson, Cecil |
| Awdry, Daniel | Harvie Anderson, Rt Hon Miss | Pattie, Geoffrey |
| Baker, Kenneth | Hastings, Stephen | Penhaligon, David |
| Berry, Hon Anthony | Havers, Sir Michael | Percival, Ian |
| Biffen, John | Holland, Philip | Powell, Rt Hon J. Enoch |
| Biggs-Davison, John | Hordern, Peter | Prior, Rt Hon James |
| Boscawen, Hon Robert | Hunt, David (Wirral) | Raison, Timothy |
| Bowden, A. (Brighton, Kemptown) | Hurd, Douglas | Rathbone, Tim |
| Boyson, Dr Rhodes (Brent) | Hutchison, Michael Clark | Rees-Davies, W. R. |
| Braine, Sir Bernard | Irving, Charles (Cheltenham) | Renton, Rt Hon Sir D. (Hunts) |
| Brittan, Leon | James, David | Ross, Stephen (Isle of Wight) |
| Brocklebank-Fowler, C. | Kershaw, Anthony | Ross, William (Londonderry) |
| Bryan, Sir Paul | Kimball, Marcus | Rossi, Hugh (Hornsey) |
| Buchanan-Smith, Alick | King, Evelyn (South Dorset) | Rost, Peter (SE Derbyshire) |
| Buck, Antony | King, Tom (Bridgwater) | Royle, Sir Anthony |
| Budgen, Nick | Kirk, Sir Peter | Sainsbury, Tim |
| Carlisle, Mark | Knight, Mrs Jill | St. John-Stevas, Norman |
| Churchill, W. S. | Lester, Jim (Beeston) | Shaw, Giles (Pudsey) |
| Clark, Alan (Plymouth, Sutton) | Lloyd, Ian | Skeet, T. H. H. |
| Clegg, Walter | Loveridge, John | Speed, Keith |
| Cockcroft, John | Luce, Richard | Spicer, Michael (S Worcester) |
| Cooke, Robert (Bristol W) | McCrindle, Robert | Sproat, lain |
| Cope, John | Macfarlane, Neil | Stanbrook, Ivor |
| Corrie, John | MacGregor, John | Steel, David (Roxburgh) |
| Costain, A. P. | Macmillan, Rt Hon M. (Farnham) | Stewart, Ian (Hitchin) |
| Crouch, David | McNair-Wilson, M. (Newbury) | Stradling Thomas, J. |
| Dykes, Hugh | McNair-Wilson, P. (New Forest) | Taylor, R. (Croydon NW) |
| Eden, Rt Hon Sir John | Mather, Carol | Taylor, Teddy (Cathcart) |
| Edwards, Nicholas (Pembroke) | Maxwell-Hyslop, Robin | Temple-Morris, Peter |
| Emery, Peter | Meyer, Sir Anthony | Thomas, Rt Hon P. (Hendon S) |
| Eyre, Reginald | Miller, Hal (Bromsgrove) | Townsend, Cyril D. |
| Fairbairn, Nicholas | Mills, Peter | Vaughan, Dr Gerald |
| Fell, Anthony | Miscampbell, Norman | Viggers, Peter |
| Finsberg, Geoffrey | Moate, Roger | Wainwright, Richard (Coine V) |
| Fisher, Sir Nigel | Molyneaux, Jame[...] | Wakeham, John |
| Fookes, Miss Janet | Monro, Hector | Walder, David (Clitheroe) |
| Forman, Nigel | Montgomery, Fergus | Walters, Dennis |
| Fowler, Norman (Sutton C'f'd) | Morris, Michael (Northampton S) | Warren, Kenneth |
| Freud, Clement | Morrison, Charles (Devizes) | Weatherill, Bernard |
| Gorst, John | Morrison, Hon Peter (Chester) | Younger, Hon George |
| Grant, Anthony (Harrow C) | Neubert, Michael | |
| Gray, Hamish | Newton, Tony | TELLERS FOR THE NOES: |
| Grist, Ian | Page, Rt Hon R. Graham (Crosby) | Mr. Spencer Le Marchant and |
| Hall, Sir John | Pardoe, John | Mr. W. Benyon. |
| Hampson, Dr Keith |
§ Question accordingly agreed to.
1719§ Dr. John A. CunninghamI beg to move Amendment No. 4, in page 1 leave out lines 21 to 23.
§ Mr. Deputy SpeakerWith this we may take Government Amendments Nos. 5 and 9 and also the following amendments:
§ No. 8, in Clause 3, page 3, line 12, leave out subject to subsection (3) below,';
§ No. 10, in page 3, line 17, leave out subsection (3).
§ Dr. CunninghamAmendment No. 4 is consequential upon changes which have been made. The energy conservation provisions, now removed from Clause 3, and the permanent power to control prices now incorporate the qualifications as to the making of orders formerly contained in Clause 3, (2) and (3), to which this subsection refers. The amendment deletes this subsection (3) altogether. I hope that Opposition Members will agree that it serves the purpose that they were trying to achieve.
Amendments Nos. 5 and 9 are consequential on the new provisions incorporating the qualifications as to the making of orders at present contained in Clause 3, (2) and (3). As Clause 3(2) will no longer contain a restriction on the making of directions when an Order in Council is not in force it is necessary to make a direct reference to this restriction in Clause 2.
Amendment No. 9 is consequential on Amendments Nos. 1 and 5. It completes the alterations necessary to make Clause 3 solely concerned with the triggering of the provisions to deal with an energy emergency.
6.30 p.m.
Hon. Members will have noted that the two Opposition amendments have been tabled on the same provision. We prefer Amendment No. 9 because of its drafting. It is part of a series of amendments as a result of which subsection (2) of Clause 3 will now be directly linked with Clauses 1 and 2, which it qualifies. I hope that hon. Members will support the Government amendment.
§ Mr. GrayThis is an example of how the Government have taken notice of some of the suggestions made to them. It would certainly not be for an Opposition hon. Member to argue with a Minis- 1720 ter about the quality of drafting. I am sure that the Government's drafting will stand up to the test of time, and since their amendment goes a long way towards what we seek we shall not oppose it.
§ Amendment agreed to.