§ Mr. Giles ShawI beg to move Amendment No. 4, in page 3, line 27, leave out 'the Commission consider them' and insert 'they are'.
We now move on to consider the first of the amendments to Clause 2, which concerns the criteria which have been set down for the working of the Commission and, in particular, its duty to have regard to certain specified matters.
The House will recall that the clause was not only the subject of extensive consultation but was, indeed, preceded by a period of consultation about the criteria listed within it. Therefore, it is obvious that the criteria are considered to be very important.
The first point that we wish to establish is that, where important criteria are listed in a Bill, they should be seen to be important and their importance should be safeguarded. In Committee, when we raised the question of the discretionary power vested in the Commission to have regard or disregard to certain criteria, the Government were unwilling to accept that distinction.
I understand that the Secretary of State is concerned to establish a Commission that will carry through its obligations with the maximum degree of sensitivity, consultation and, we hope, fairness. The Committee stage was somewhat bedevilled by the number of times that the Government seemed to take shelter behind the formation of the Commission and, in particular, the nominations that they would eventually approve for the chairman and other members, so that they would be able to demonstrate to industry that the Commission was fairly staffed.
We have had the first announcement about the composition of the Commission. We may draw our own conclusions about that. However, we are still far from satisfied that the Commission, so appointed, should be allowed this dis- 1228 cretion when it comes to determining which of the criteria listed in the clause are relevant. The purpose of the amendment to take that discretionary power from the Commission and to ensure that that it considers the criteria which are relevant. It should not be allowed to say "We do not believe that that criterion should be considered in this particular investigation, because we do not consider it to be relevant."
I should like to explain the importance of these criteria. We understand that they will guide the Commission in deciding whether a price application should result in an investigation. Therefore, it is important that the Commission should have regard to the criteria and that those making the price application should understand by which criteria they are to be judged.
On this aspect of the proposal we found ourselves in great difficulty in Committee. The Government were clearly unwilling to deal with the criteria in a full and open manner. They wished to reserve to the Commission the right to decide that certain of the matters listed in the clause should be regarded as relevant and that others should not. We think that it is important for the Commission to be seen to work fully and fairly within the criteria. Therefore, it should not be given the power to decide whether certain of the criteria should be disregarded.
I should like to offer a further explanation of the importance of this matter. In our view a company, having made a price application, should have the right to know under which of the criteria it is to be investigated. It may be that the criteria should be published at the time of notification of the price application so that the investigation, when it takes place, will be seen to be dictated by certain relevant criteria.
If we allow the Commission to have this discretionary power, industry and, indeed, the applying company would not know under what heads of Clause 2 the application was being investigated. That could have serious repercussions. For example, a company might prepare a defence on its interpretation of the 1229 criteria which the Commission considered only to find that those were criteria which the Commission had elected to disregard because it did not consider them relevant.
To put the matter another way, a company, in making its price application and price planning, might regard the need to earn a real return by way of profit as its leading criterion, but the Price Commission in its wisdom might decide that it did not wish to apply that criterion in that case. I admit that that is unlikely, but the Bill allows that situation to arise.
If the Secretary of State really seeks to stress that Clause 2 provides important safeguards to give industry confidence in the workings of the Commission, the first safeguard he must apply is that industry is treated in an open-handed and fair manner and that it knows precisely where the criteria will lead.
If the Commission is allowed to operate discretion when dealing with these safeguards, they will not be the safeguards that the Secretary of State in consultation told industry they would be. As long as there is a discretionary power, doubt will remain about the effectiveness of the criteria.
I come to the way in which the Commission is to operate. It is of the utmost importance that the Commission is seen to operate according to a certain pattern, just as any investigatory body has to establish a series of yardsticks and case law to guide its activities. The pattern gradually becomes clear, and those affected can plan on that basis. If it is seen that the Commission is operating the criteria without the discretionary power, industry will know the yardsticks by which it should measure its likelihood of attracting a price investigation. Industry can therefore take into account all the matters listed in the Bill, knowing that the Commission will not disregard the criteria that are relevant to the price application. This will have a substantial effect on the confidence that is built up between those who have
| Division No. 159] | AYES | [10.00 p.m. |
| Abse, Leo | Atkins, Ronald (Preston N) | Benn, Rt Hon Anthony Wedgwood |
| Allaun, Frank | Atkinson, Norman | Bennett, Andrew (Stockport N) |
| Anderson, Donald | Barnett, Guy (Greenwich) | Bidwell, Sydney |
| Archer, Rt Hon Peter | Barnett, Rt Hon Joel (Heywood) | Bishop, Rt Hon Edward |
| Armstrong, Ernest | Bates, All | Blenkinsop, Arthur |
| Ashley, Jack | Bean, R. E. | Boardman, H. |
| Ashton, Joe | Belth, A. J. | Booth, Rt Hon Albert |
§ to carry out both parts of the bargain—the Commission seeking to operate clearly and fairly, and industry understanding the way in which the Commission operates.
§ In recent weeks we have been led to believe that the safeguards in the Bill are not what the Secretary of State told us they would be in Committee. There is real disagreement about the safeguards, and we shall discuss them further when we reach Clause 9.
§ The Minister will be aware of the deep anxiety that the Government have caused. I put it to him that the Commission's duty to have regard to specified matters under Clause 2 is even more important. We add another element of uncertainty if we allow the Bill to go through with doubt about the weight that will be given to the criteria.
§ In Committee the Government were unable to accept a similar amendment. It resulted in a tied vote. What has happened since has increased our anxiety about the need for the amendment.
§ If Clause 2 is to be effective, the Commission must be seen to act fairly. It should not be allowed to take a discretionary view about which criteria are adequate and which are relevant. From that point of view we should certainly welcome an admission by the Government that they accept that the amendment should be put forward, because, as far as we can see, no real concession has been made to the substantial points that we put to the Government in Committee.
§ It being Ten o'clock, further consideration of the Bill stood adjourned.