RESTRICTIONS, UNDERTAKINGS AND ORDERS IN CONSEQUENCE OF REPORTS ON INVESTIGATIONS (Hansard, 21 June 1977)

§ Mr. Maclennan
I beg to move Amendment No. 40, in page 13 line 20, after 'but', insert: '(a) the duty imposed on the Commission by section 2(1) of the 1973 Act to have regard to the code in performing their functions under that Act shall not apply to functions attributable to the preceding provisions of this subsection; and (b)'. This is a simple and uncontroversial amendment. In enforcing orders the Commission would not be required to have regard to the provisions of the Price Code. That is because the Counter-Inflation Act enforcement provisions are carried into the new system. However, it is inappropriate to have references of this kind to the Price Code when the enforcement relates to orders following investigations.

§ Mr. Maclennan
I beg to move Amendment No. 41, in page 13, line 24, leave out subsection (8) and insert: '(8) If during a period when section 4(2)(b) of this Act applies to the whole or part of an increase of a price or a period when, apart from section 9 of this Act, an increase of a price is restricted by virtue of subsection (1) or precluded by virtue of subsection (5)(a)(ii) of this section, notice of an increase in the price is given in pursuance of an order under section 5 of the 1973 Act, the notice shall be deemed not to be given when it is actually given and shall be deemed to be given—

(a) on the first day on which no such period is current in relation to the price; or

(b) on an earlier day specified by the Secretary of State if, on the application of the Commission or the relevant person and after consulting whichever of them is not the applicant, he specifies such a day in respect of the notice'.

§ Mr. Deputy Speaker (Mr. Bryant Godman Irvine)
With this it would be convenient to take Government Amendment No. 51.

§ Mr. Maclennan
This is a slightly more complicated amendment. Therefore I feel that I should explain it to the House.
The problem here arises where a firm has been investigated and the Price Commission has recommended some action and the Secretary of State has made an order. At the end of the currency of the order a firm would almost inevitably want to make a price increase and would therefore need to give 28 days' notice, and the Commission may want to investigate the justification of that further increase. It was with that in mind that the original Clause 7(8) was included in the Bill.
There were a number of defects in the original drafting of the Bill. It is felt that the new subsection meets the difficulty. Effectively, it prevents firms, during the currency of the restriction, from submitting one or more notifications of proposed price increases and enables the Price Commission to have, as it were, a clear period during the restriction. I believe that a company's interests are safeguarded by the inclusion in the subsection of a waiver power granted to the Secretary of State which prescribes the circumstances in which it would be exercised.

§ Mr. Younger
I am grateful to the Under-Secretary of State for his explanation of the amendment. I accept that his intention has been to improve the Bill. In the interests of keeping matters moving and not taking up too much time, I 1521 shall confine myself to saying that we do not find this amendment entirely satisfactory. It is not fair to companies, nor do they see it as such. We shall not support the amendment.

§ Mr. Parkinson
I beg to move Amendment No. 43, in page 13, line 28, at end insert— '(9) Notwithstanding anything in the preceding provisions of this Act. if a person has given an undertaking under this section and it has been accepted or if an order made under subsection (5) of this section applies to a person and that person represents to the Commission that the circumstances have changed since the date of the undertaking or order so that a restriction of a price or margin is no longer appropriate the Commission shall forthwith investigate the representation and if the Commission think that it is justified the Commission shall, not later than 28 days after receipt of the representation, make recommendations to the Secretary of State in accordance with their findings; and if within 14 days after receiving such recommendations the Secretary of State does not release the undertaking or vary or revoke the order accordingly he shall lay before each house of Parliament a memorial giving his reasons therefor'. Under the Bill as it now stands, the Secretary of State has the discretion to vary an order made by himself and enforced by the Price Commission. It seems to us that where an order has been made or an undertaking given, and there is a dramatic change of circumstances—for instance, the example of a commodity broker was mentioned in Committee; a person dealing in coffee who suddenly finds that the whole basis of his pricing is totally transformed by circumstances beyond his control—provision should be made in the Bill for the circumstances to be reassessed, for the order to be rescinded or for the order to be changed.
In the amendment we suggest a procedure which we feel is better than the power at present given to the Secretary of State in subsection (6). The procedure is very simple. It is that the person concerned or the company should have the right to make representations to the Price 1522 Commission. After all, the Price Commission will be the body which has the information and which conducted the investigation—and on the basis of its recommendation the Secretary of State will have made his original decision.
It seems to us that it would be far better if the person concerned had the right to approach the Price Commission to make representations about the changed circumstances and for the Price Commission to have the power to re-examine the submission, and that if it came to the conclusion that there were suitable grounds for recommending a variation of an order, the Price Commission should make that recommendation to the Secretary of State. The Secretary of State would then have 14 days in which either to accept the recommendation of the Price Commission or to lay before Parliament something that the amendment describes as a memorial, explaining to Parliament why he has decided not to accept the recommendations of the Price Commission.
The features of the procedure that the amendment would bring into the Bill would be, first, that the Secretary of State would not be able to act on his own discretion without explanation to Parliament unless he was acting on the advice of the Price Commission and on its recommendation. Secondly, we believe that our procedure, as outlined in the amendment, writes into the Bill an escape clause and a sensible procedure should the relevant person's circumstances alter in a serious or important way. Thirdly, we believe that it brings into this decision the Price Commission, which is, after all, the body which has done the work, which has investigated the company, which has come to the conclusion that there should be a price freeze originally, and which has made the recommendation to the Secretary of State.
In replying to the amendment that we proposed in Committee—on which the vote was tied—the Minister said that he had a great deal of sympathy with what we were trying to achieve and that he was in no way hostile to the spirit of the amendment. He made an offer which, by the standards of the behaviour of the Ministers on this Bill, was exceptionally generous. He said "I shall not accept the amendment, but what I promise is that before the Minister takes a decision, the 1523 Price Commission will be consulted". He also explained that in his view one of the reasons why the Price Commission should not be brought into this procedure was that 28 days would not be a long enough period for the Price Commission to act, and therefore it was far better that the person should have direct access to the Secretary of State, who should take the advice of the Price Commission.
However, I fail to see how the Price Commission will put itself into a position that will enable it to advise the Secretary of State within 28 days when it will not be in such a position within 28 days if approached directly itself. Presumably the Price Commission will have to act swiftly if the Secretary of State approaches it, yet the Minister argued, as one of the reasons why he could not accept our amendment, that the Price Commission was not capable of acting at the speed at which it would need to act.
We do not expect that there would be a very large number of these applications in the course of a year, and we know that if they were to be made, they would be made by companies that would have very serious problems indeed and would need a speedy decision.
5.30 p.m.
The Price Commission must gear itself either to giving the Secretary of State the advice which the Minister of State said that his right hon. Friend would seek or alternatively that it is not capable of giving that advice. The Minister cannot argue against the procedure which the amendment outlines. We had this discussion upstairs. There was very little difference between us. We failed to resolve it, and that is why we are discussing it again today.
The Minister has had a little longer to consider the matter. I hope that he will come to the conclusion that the procedure we suggest is more consistent with the way in which the Commission will work than direct access to the Secretary of State and the discretion of the Secretary of State. It fixes the Price Commission firmly in the procedure and gives the Commission an important rôle in arriving at a decision which we think the Price Commission should have a part in taking.
1524 At this time of night I find the words that I want to say do not come easily. But since the Minister's mind is probably in roughly the same state as mine I am sure that he understands the point that I am trying to make. I therefore hope that having had a chance to reconsider his attitude he will come to the conclusion that the procedure outlined in the amendment is sensible and deserves to be incorporated in the Bill.

§ Mr. John Fraser
It is not out of obstinacy but out of consideration for the parties affected that it would be better, and in the interest of the firms subject to an order, that they should make their applications to the Secretary of State. I take that view for a number of reasons. First, it will be the Secretary of State who takes the decision on the recommendation or advice of the Price Commission. It may be that the grounds are less clear than that recommended by the Commission but, at any rate, it will have been his responsibility to make the order.
The second reason is that one immediately makes the Secretary of State accountable to Parliament. The firm need only contact its Member of Parliament in order for a Question to be put down and immediately the Secretary of State can be pressed and questioned in a way that cannot take place if the application is made to the Price Commission. Therefore, I think we are doing a favour to the firm by giving it direct access.
Third, we do not intend to leave the Price Commission out of account. I gave an undertaking to the Committee which I reaffirm, that in all cases the Secretary of State will consult the Price Commission. Our procedure provides a more direct and rapid line of communication to the person whom the order covers. It is a flexible procedure—it could be quicker than 28 days if the Secretary of State found that there was an overwhelming case and wanted to act quickly—and it does not tie the firm down to rigid time limits.
The difference between us is not about the objective of the amendment but rather its efficacy. I believe that what I have outlined is more beneficial for the firms concerned, and it is for that reason that I have not changed my mind.

§ Mr. Tebbit
Given that I have entered the debate again having been out of the Chamber for a little while, it is almost as puzzling as having been here all the time. I looked at the amendment carefully because I wanted to support my hon. Friend if I possibly could. There are one or two things that worry me about the amendment. That may be because I have not been involved in the debates all the way through and therefore have been denied the incalculable privilege of having heard the Under-Secretary putting his arguments in Committee. That is the sort of privilege that all of us regret having missed.
It is the wording of the amendment that worries me. I am also worried by some of the reasons given in the Minister's reply. I am still not certain whether in all cases a person and a company are interchangeable. I hope that my hon. Friend can tell me a little more about that.
The second line of the amendment states: Given an undertaking under this section and it has been accepted". One must at this stage ask "accepted by whom?". Is it accepted by the Secretary of State or by the Commission. I hope that my hon. Friend does not think that I am nitpicking because when I read the amendment I thought that here and there it might be a trifle weak. That is when I came back to reality. For example, the beginning of Clause 7(1) states: On the effective date of a report in pursuance of subsection (1) of the preceding section in respect of an increase or a price, section 4(2)(b) of this Act shall cease to apply to the increase or, as the case may be, section 5(3) of this Act shall cease to apply to the price; and on and after that date any provisions recommending a restriction of the increase or price which are included in the report in pursuance of subsection (4)(b)(i) —so far we have had four references back— of the preceding section shall have effect, until the date determined in pursuance of the following subsection and subject to section 9 of this Act— One begins to think that my hon. Friend's purity and clarity would stand out like a sore thumb in the Bill. It is very puzzling to fit it all together. The amendment goes on: and that person represents to the Commission that the circumstances have changed since the date of the undertaking or order". 1526 Which undertaking, or which order? I shall not go into the remainder of this because it goes back to subsection (5) of this section. You may think, Mr. Deputy Speaker, that I have read out rather a lot of this Bill, but that was only part of subsection (1) of Clause 7. If we turn to subsection (5) we find—goodness me, it covers half a page with the same sort of gobbledegook. I am not certain whether it relates to subsection (5) of this section. My hon. Friend the Member for Hertford-shire, South (Mr. Parkinson) may be able to help me. Is it subsection (5)(a)(i) or subsection (5)(a)(ii) that refers us back to subsection (4)(b)(ii) of the preceding section? Subsection (5)(a)(ii) states that a price should not be increased during a particular period, providing that the price shall not be increased during that period or a shorter period by virtue of section 9 of this Act". I can see that my hon. Friend the Member for Ashfield (Mr. Smith) is as puzzled as I am. I shall help him if I can.

§ Mr. Tim Smith
I shall hope to help my hon. Friend, because the only reference in the amendment to subsection (5) is that part which refers to an order made under that section. It is quite clear under subsection (5)(a) that it refers to the making of an order. I do not think that my hon. Friend is in any difficulty.

§ Mr. Tebbit
My hon. Friend is obviously far cleverer than I am, because I am in considerable difficulty and I really believe that if anyone who listens to all the gobbledegook contained in the Bill—[Interruption]. Does the Minister wish to intervene?

§ Mr. John Fraser
I was wondering whether all those controls in the cockpit confused the hon. Gentleman.

§ Mr. Tebbit
No. They were designed by logical people to achieve a logical purpose. There was no problem there at all. But when one gets to legislation of this sort one knows that sooner or later in the courts we shall have lawyers coming in and going through this great game. I can see my hon. Friend's eyes lighting up at the mere mention of lawyers. But I put it to the House that the Industrial Relations Act was pretty straightforward compared with this. Perhaps my hon. Friend the Member for Hertfordshire, South will tell me how 1527 this part of the amendment fits into subsection (5). It goes on: that person represents to the Commission that the circumstances have changed since the date of the undertaking or order so that a restriction of a price or margin is no longer appropriate". On what criteria? Where are the criteria that he should use. If we go back to Clause 2 and look at some of the criteria we see that it says, "It shall be the duty of the Commission"—I assume that the same would apply to a person— to have regard to all matters which appear to the Commission in the particular circumstances to be relevant.

§ Mr. John Fraser
The Secretary of State is equally bound by the criteria when making an order, considering a reference, or varying or revoking an order.

§ Mr. Tebbit
I am not getting at the Minister. This is my hon. Friend's amendment, and he says that the person must represent to the Commission how circumstances have changed since the date of the undertaking and why the restrictions on prices or margins is no longer appropriate. The person is to take account of the criteria which would have been taken into account by the Commission, but he does not know what these criteria are. My hon. Friend may think that I am being a little thicker than usual, but it is difficult at this stage in our proceedings to get it straight.
In Clause 2(1)(a) the Commission is directed to have regard to all matters which appear to the Commission in the particular circumstances to be relevant". First of all, how can any person who has to do that know what was in the mind of the Commission. The words in the particular circumstances to be relevant constitute a pretty broad scope, and a person would be in some difficulty here. How would he know what the Commission would have thought was relevant?

§ Mr. Tim Smith
I think that it is worth pointing out that although the amendment came from the Opposition side of the House the Minister of State said in Standing Committee that, 1528 In practice, the Price Commission will try to inform the firm to be investigated of its prima facie reasons for coming to the conclusion that there ought to be an investigation."—[Official Report, Standing Committee B, 12th May 1977.]

§ Mr. Tebbit
Obviously my hon. Friend is trying to be very helpful, but what the Minister says in Committee has no standing in the courts. It is no good turning up in court and demanding that the Commission give information simply because the Minister said that it should do so. We can expect some difficulties there. I think that my hon. Friend might want to consider this a little more carefully. I am not criticising the principle of the amendment—the drafting can always be tidied up in the Lords.

§ Mr. Cyril Smith
I should vote against it if I were you.

§ Mr. Tebbit
The hon. Member for Rochdale (Mr. Smith) thinks that I should vote against it. That is what this place is all about—persuading each other on issues. It may be disappointing for my hon. Friend if he cannot persuade me. I would like him to do so, because I am persuaded by the argument of what he wishes to achieve by the amendment. It is all the untidiness that rather worries me.

§ Mr. Burden
Does my hon. Friend the Member for Chingford (Mr. Tebbit) look with kindness on the advice of the Liberal Party?

§ Mr. Tebbit
Of course I look on it with kindness. I look with kindness on all dumb creatures—including the Liberal Party.
The amendment says that if within 14 days after receiving such recommendations the Secretary of State does not release the undertaking or vary or revoke the order accordingly he shall lay before each house of Parliament a memorial giving (us reasons therefor". It does not seem that my hon. Friend has emphasised the time limit on the period in which the Secretary of State has to lay the memorial. The Secretary of State has 14 days to realise the undertaking or to vary or revoke the order. He could after that time sit there fat, dumb and happy, as Secretaries of State tend to do, and not lay the memorial for a very long time. Perhaps my hon. Friend is willing to suggest that if the House accepted this subsection we could 1529 persuade the Lords to carry out further amendments to it. No doubt they would enjoy doing so at the appropriate time of the day or night—they are rather good at doing that.
Although I have doubts about my Friend's proposal, the Minister's words worried me even more. He said that the Secretary of State would give access to the person directly—I assume that means in writing, otherwise it would be an untidy affair. But how does the person concerned know whether the Secretary of State is being really fair? The Minister's answer to this was that the Secretary of State is accountable to Parliament, but how many of us seriously buy that one? If we did we would be mugs. The Secretary of State for Prices and Consumer Protection answers Oral Questions in the House once every three, four or five weeks. If one is lucky one might get a Question in the first 15 that are answered, and they are answered only if the Minister is pretty slick-moving.
An hon. Member may have received many letters from his constituents complaining about a matter being outrageous and urging him to raise it with the Secretary of State. That is all very well, but there are three hazards involved. The first hazard is that the Question will not get to the top of those selected for oral answer, and even if it does it could be several weeks before it gets there—a far longer period than the 28 days suggested by the Minister as being an excessively long period for a person or firm to be in doubt.
The second hazard is that one's Question might be on the margin. It might be No. 16. But suddenly, when the Minister arrives at Question No. 14, his answers become longer and longer, until they are reminiscent of the speeches that we have heard here in the past 24 hours. One gets the impression that he is just playing for time—of course, I know that nobody in this House ever filibusters, but there are moments when Ministers are answering Questions and one gets the impression that there is a sticky one coming up that they do not wish to answer. It just passes through our minds that their answers on earlier Questions may be rather more detailed than usual. This is a natural technique of the Executive when it does not wish to answer a Question.
1530 The third hazard occurs when one actually gets a Question answered. The Minister's answer would probably be to the effect that he had taken all the criteria into account and decided that his action was proper.
The hon. Member concerned then leaps to his feet and comes up with the devastating supplementary question which he has rehearsed for weeks on end. The Minister then puts on a smooth manner and says "It is not in the interests of the company or the person concerned to reveal these pieces of commercial information, which would not be in the best interests of the person concerned. I am surprised at the hon. Member pressing me to make that information available in the House. "That is the end of the message. The most the hon. Member can do is to leap to his feet and say that, because of the unsatisfactory nature of the answer, he will seek to raise the matter on the Adjournment.
What chance is there for the matter to be raised on the Adjournment? The hon. Member has many other matters that he wishes to raise in Adjournment debates involving constituents and their rates, pensions and other problems. Since there are five debates a week, of only half an hour's duration, there is not a great deal of opportunity to raise such matters. However, when the hon. Member eventually gets the opportunity to raise the matter on the Adjournment, he will have a quarter of an hour at 10 o'clock at night to make his case—that is, if the Government's business has not collapsed earlier or if the business of the previous day has not been carried over, as has happened on this Bill.
What about the poor devil who thought he had an Adjournment debate on Wednesday but who——

§ Mr. Deputy Speaker
Order. We are not dealing with Wednesday's Adjournment debate. Perhaps the hon. Member will return to Amendment No. 43.

§ Mr. Tebbit
It does not take very much effort to return to it, Mr. Deputy Speaker. The Minister said in his argument against the amendment that there are plenty of ways in which matters can be raised in the House. I am describing the ways in which matters can be raised in the House—or, more particularly, the ways in which they cannot be raised in the House.
1531 As I was saying, some unfortunate hon. Member will miss tonight's Adjournment debate. He may well have to get back into the queue. It is a matter of chance whether that subject will be selected for an Adjournment debate. Therefore, it will be a long time before it comes up again.
If the hon. Member in question has the good fortune to obtain such a debate and to make a fifteen-minute speech, all he will get from the Minister is a fifteen-minute version of the fifteen-second reply that he would have been given a month before. At the end of the whole business, Mr. Speaker gets up and says that the House is adjourned, everybody goes home, and that is the finish. That was the great big deal of a debate that was held out by the Minister, who said——

§ Mr. Deputy Speaker
Order. I think that might be an appropriate moment to say that we have had quite a good debate on Amendment No. 43. Perhaps the hon. Member will return to it.

§ Mr. Tebbit
I had not noticed that I had got away from the amendment. If the Chair would like me to return to some other part of the Minister's comments about the amendment, no doubt that will be in order.
We are told that the Secretary of State will consult the Commission in these matters. However, there is no guarantee, promise, suggestion or, indeed, half promise, that the right hon. Gentleman will tell anybody the results of those consultations. Unless this amendment is accepted, there is no way in which the person concerned would know what the Commission's view was as given to the Secretary of State. The Secretary of State has said that he can act quickly and, indeed, more quickly than provided by the 28-day limit. That implies that the Secretary of State, as the Bill now is constituted, can sit on the matter for 14 or 21 days and ask the Commission for an answer. The only snag is that nobody will know what the answer is.
I have some doubts about the wording of my hon. Friend's amendment, and no doubt the Bill will leave this place in an imperfect state. However, until the Lord President becomes a member of a majority Government we shall have the priceless advantage of the revising Cham- 1532 ber at the other end of the corridor. I hope that my hon. Friend will be able to answer my queries. On balance, I am inclined to give him the benefit of the doubt and leave the other place to tighten up the provisions.

§ Mr. Parkinson
I find myself in a difficult position. I know that my hon. Friend the Member for Chingford (Mr. Tebbit) takes this matter seriously, and he made some important points. Unfortunately, I shall have to do to my hon. Friend what the Minister has been doing to him in the last two days—in other words, I shall have to disappoint him.
I find myself in a quandary. We did not intend to press the amendment to a Division; we wished to withdraw it. Now I must face the choice of defending an amendment that I am about to withdraw, which might involve us in a wide-ranging discussion that runs through the Bill from Clause 2 onwards, or I can discuss the matter with my hon. Friend privately. However, he and I have more important things to do than to discuss an amendment that I do not propose to press. At any rate, my hon. Friend has had a longer reply from me than he has received from the Minister in the whole of the last 26 hours. I hope that my hon. Friend will feel that he has had some sort of answer.
I beg to ask leave to withdraw the amendment.