§ Order of the Day for the Second Reading read.
§ LORD SOMERLEYTONMy Lords, In moving the Second Reading of this Bill I will not trespass upon your indulgence for more than a few moments. I think it is clear that this Bill is necessitated by the conditions which are now prevailing owing to the war. These undertakings have to face an enormous increase in the cost of production in every way. Wages have risen from 60 to 100 per cent., materials have risen from 100 to over 200 per cent., and, in addition to this, there have been various restrictions on the amount of each article allowed to be consumed, and we fear that those restrictions may even be in- 12 creased in the future. These undertakings, therefore, the profits of which are fixed by I Statute, require now to be reviewed, the war having brought about a total reversal of the conditions obtaining before, in order that the interest may be paid on the capital expended. Hence this Bill is now introduced. May I remind your Lordships that in all similar undertakings the charges have greatly increased; and although they have been increased in these particular undertakings, in other undertakings which are not statutory the increase has been much greater.
A Select Committee which reported some little time ago recommended legislation, and the need for a Bill is therefore, I think, apparent to all. May I say one word with regard to the amount of modification allowable The Select Committee recommended no modification should be authorised more than would enable a dividend on the ordinary shares or stock to be paid at half the standard or maximum rate of dividend, if any, prescribed, or at half the pre-war rate of dividend, whichever was the lower. The Bill as introduced had a provision to this effect, but in another place, as you are aware, an Amendment was carried and three-quarters was substituted for one-half; but I would remind your Lordships that this three-quarters fixed in another place was so fixed after the very fullest discussion in Committee, and that two different divisions took place and the Amendment was carried by a very large majority. Not only this, but the point was raised again on the Third Reading of the Bill, and again three-quarters was carried by a very large majority. I would also venture to remind your Lordships that since the Report of the Select Committee was made the price of coal has risen 4s. per ton, in this way further increasing the cost of production.
I should say, before I sit down, that it is proposed that the Act shall have effect until the expiration of a period of two years after the war. This is in accordance with the recommendations of the Committee on Tramway Undertakings, and differs somewhat from the recommendation of the Gas Committee, which was that general legislation should have effect for one year after the war and such further period as the Board of Trade might by Provisional Order determine. The rather longer maximum time seems, in the view of the Board 13 of Trade, not unreasonable, and the period is final. I trust, therefore, that your Lordships will give a Second Reading to the Bill.
§ Moved, That the Bill be now read 2a.—(Lord Somerleyton.)
THE MARQUESS OF CREWEMy Lords, I have no intention of offering any opposition to the Second Reading of this Bill, but I desire to make one or two observations arising mainly out of the point to which the noble Lord opposite devoted a considerable part of his speech. As he has stated, a Select Committee was appointed in another place to consider the situation which my noble friend opposite has correctly described. These statutory companies with a standard dividend and a standard price have naturally found themselves placed in a highly inconvenient position owing to the circumstances of the war, and I do not think any one can complain of the interference of the Legislature with a system which in the past has worked exceedingly well and which has been highly profitable to the gas companies themselves and has been by no means adverse in its effects to the consumer.
His Majesty's Government therefore appointed a Select Committee—I think in April last—and that Committee reported in the sense which the noble Lord stated—namely, that in the case of any company operating under a sliding scale whose dividend has been reduced to one half of the standard or maximum rate, or one half of the maximum dividend, the sliding scale ceased to operate; that is to say, when the dividend reached only one half then the company should be able to reimburse itself to a certain extent. That was understood to be the unanimous recommendation of the Committee. I think this was stated in another place. But when the Bill was under discussion there the change which the noble Lord has spoken of was suggested—namely, that a figure of three-quarters in place of the figure of one half should be permitted to be the point at which the companies could seek for reimbursement.
The Government, for some reason which is not comprehensible to everybody, in lieu of supporting the recommendations of the Committee, allowed this to be treated as an open question, and, as the noble Lord has stated, the substitution of three-fourths for one-half was carried by a considerable 14 majority at two stages of the Bill. Knowing the influence possessed by such powerful corporations as the gas companies, assisted, it must be remembered, in this particular measure by the representatives of a number of other companies—electric lighting, tramways, and others—whose interests, for one reason or another, were not directly affected by this particular provision, but who were prepared to act, as they usually do, in common with those whose interests are generally similar to their Own, I think it may be assumed that no inconsiderable pressure was applied to hon. Members in order to induce them to make this change in favour of the companies and against the consumer.
The effect of this change upon London is very serious indeed. Already the sum which London has to pay for its gas has unwanted to no less than £4,000,000 above the pre-war price, Owing to war conditions. The addition of this quarter to the amount which the consumers will have to pay—because it may be taken as a fact that the whole of this will fall upon the shoulders of the consumers—represents for London alone no less than £289,000. Therefore it is not surprising that the representatives of London, both the London County Council and the Corporation, desire to enter the strongest possible protest against this provision and are prepared to do their best to get a change made.
What are the reasons put forward for the alteration? One reason advanced is that the shareholders in gas companies are, many of them, quite poor people, and that they council afford to see a reduction of as much as one-half in the dividends which they receive. This is no doubt true in a great many cases. There are far more small shareholders in gas companies than there are, presumably, in electric lighting companies, or certainly in railways. From the days of Sir George Livesey's well-known policy at the South Metropolitan Gas Company it has been the wise and praiseworthy custom of these companies to induce as ninny as possible of their employees and their friends to invest in small amounts. Although this is true, it is by no means the whole truth. Large blocks of shares ill gas companies are held by important corporations and by individuals, and it is by no means the case that the whole interest is in the hands of small people. Even if it were, that would be no reason for making this change. If it be necessary to 15 maintain the dividends of the shareholders in gas companies, His Majesty's Government ought to make it possible for the gas companies to pay their dividends.
In ordinary times a large part of the profits of gas companies comes from their by-products. The residuals of gas-making, as we all know, are at all times valuable, and they have become infinitely more valuable since the war began. Benzol and toluol have enormously increased in value for the national needs, but the price of these by-products was fixed in 1914 on the average of the twelve previous years, I think I am right in saying, and this has practically never been altered since. If the gas companies could get the benefit of anything like the market price of these products they would be able to pay a slashing dividend to their shareholders and reduce the price of gas. This is equally the case with sulphate of ammonia. Speaking as a farmer I am exceedingly glad that still late of ammonia is cheap. It is fixed at £15 a ton. When war broke out it was £12 a ton. If you want to buy sulphate of ammonia in the open market you would have to pay £40 a ton, but the gas companies—I have no doubt for good national reasons—are not permitted to receive men than the miserable allowance of £3 in addition to the pre-war price.
If His Majesty's Government are so careful of the interests of the shareholders in gas companies it is for the country generally to contribute and not the unhappy consumers of gas, who are in the main, as we know, very poor people themselves. Take one of the biggest companies. The Gas, Light and Coke Company's gas was 2s. 7d. a thousand feet in 1914. It is now 4s. 4d. Think what that means to the penny-in-the-slot users of gas; and these people are going to be further mulcted in order to maintain this large proportion—this three-quarters of the statutory dividends. This is by no means a question which affects only people of what may be considered extreme political views. The noble Lord will doubtless remember that in the principal division in another place one of the protagonists, speaking in the sense in which I am now speaking, was Sir Frederick Banbury, who is certainly not considered to hold wildly socialistic or extreme views on subjects connected with property, or to be likely to disregard the proper treatment of limited companies. I am very glad indeed that these share- 16 holders should receive a considerable dividend, but if they are to do so it should be at the expense of the country as a whole and not at the expense of the poor people who are consumers of gas.
LORD BALFOUR OF BURLEIGHMy Lords, I want to say a word or two about this Bill, and to ask for information as to why all the small and the large areas have been lumped together and all treated in the Sallie way. I have been in communication with a friend in a county town in Scotland, whose gas company is likely to be seriously prejudiced and injured in an unfair way by the terms of this Bill. The circumstances of Stirling are not certainly those of London, and the interests are probably different. The circumstances are certainly different, and I cannot see why the same treatment which is meted out to very large corporations is to be placed indiscriminately on the shoulders of those who really cannot afford it. I have great sympathy with the view expressed by the noble Marquess, Lord Crewe, in this respect—that the gas companies are, I think, being hit in two ways. They are being highly charged for coal, against which they have no remedy, and they are absolutely prevented from making a relative profit from their by-products. Balancing On e against the other; if they had been given equal treatment in both cases there probably would have been no necessity for this Bill at all.
The circumstances of the case that I want to present are these. The Stirling Gas Company promoted a Bill asking for temporary relief from the sliding scale clause in its present Act. That was promoted under the Private Bill Procedure Act of Scotland, and ought to have been proceeded with and heard on its merits under that Act. But for some reason or another which none of us can understand, the Bill for this relief has been conjoined with all those English Bills promoted for the same purpose, the circumstances of which are represented to me as being wholly and entirely different. In almost all these cases the gas companies have very large reserves. Surely there ought to be discrimination between the respective circumstances and position of gas companies which had distributed their profits, kept down their prices, not accumulated large reserves, not attempted to make money, and continually reduced the price of gas.
17 The circumstances of Stirling are these. Their Act was passed in 1898. It was followed by a Municipal Electric Lighting under which the town council levied for some years a total sum of £4,200 from the ratepayers to cover their annual deficits. All the time they were competing with the gas company. As a result of this competition the gas company had to keep down their price as low as possible, and in the twenty years that have passed since 1898 it has accumulated only a small reserve fund of £2,300. The Stirling Gas Company promoted a. Bill in its own way tinder the Scottish Private Bill Procedure Act, 'and it ought to have been heard by the tribunal in Scotland and reported to Parliament. So far as that Bill was concerned, there was absolutely no opposition to it. It modified the sliding scale to some extent, but the town council, as the corporate body representing the ratepayers of Stirling and the poor consumers, just as the county council represents the poor consumers in London, presented no opposition, and it met with no difficulty. No single protest was made, so far as I am informed, by a single consumer in this particular case. I do think that the regular procedure ought to have been followed, and that the Bill should have been heard on its merits. It scents very hard that the shareholders of this small company, a large proportion of whom are small shareholders, should have their dividends reduced by one-half or three-quarters under the circumstances I have indicated.
My correspondent and friend, who is chairman of the gas company, says—
I may mention that non-statutory vein-panics in Scotland pay much larger dividends than we do; also that a coal company, which supplies us with coal, has just paid a dividend of I6 per cent. to its shareholders, while we are limited to, and threatened with a reduction of, the standard rates although producing those things for munition purposes and supplying light and heat to t he public. The cost of coal, wages, awl material, has been more titan doubled since t he war began, and a temporary relief from the operation of the sliding scale, which holds the balance evenly between consumer 'and producer, should be granted to us apart from the other Bills. Surely in disposing of the general Bill it should be possible to draw a line between companies which have observed their Acts, or which have not accumulated large reserves, and those which have. It seems unreasonable that while the coal companies, miners, and many others should receive large additional payments owing to the war, the shareholders of gas companies should have their income reduced at 18 the very time when the cost of living is so much in increased.I think this is temperately and forcibly put and it scents to me that the action of the Government in mixing these questions up in one Bill is likely to lead to injustice.I think a line could In' drawn by granting full relief to companies which could show that for twenty years past what they had set aside as a reserve fund did not amount in all to more than one-fortieth part of their annually divided profits; partial relief where this came to one-twentieth; and less, or no relief, where it came to one-tenth. I think this could he easily worked out, and it would be only a matter of justice. This is far too complicated a matter for me to attempt to deal with, as I have not the facts and figures: but I propose to put down an Amendment for the Committee stage which will give relief to the shareholders of these particular companies in whose interests I have been speaking; and I believe f shall be able to make out a good case for it. It is not a question of opposing the Second Reading of the Bill, although I think it would be much fairer if Stirling could be cut out of the Bill altogether and allowed to proceed in its own way by the ordinary procedure. I shall not oppose the Second Reading, but On the Committee stage I intend to move the Amendment I have indicated.
§ LORD BUCKMASTERMy Lords, I hope that, the speech which has been made by the noble Marquess, Lord Crewe, will be a preface to an Amendment on the Committee stage proposing to alter once more the clause of the Bill so as to make it in agreement with the recommendation of the Select Committee. If such an Amendment is put down, no doubt its discussion will afford the most convenient opportunity for a careful investigation of the circumstances which are urged as justifying the proposed change. I certainly do not propose this afternoon to occupy your Lordships at any length in discussing what these circumstances may be.
What I desire to lay before your Lordships is the consideration of the course, which I regard as dangerous, that this Bill is attempting to make into law. In order to understand the circumstances in which the gas companies have induced the Government to conic forward to their relief it is, I think, only right to consider the history of the gas companies. I deal with the gas 19 companies alone, because I think that, although this Bill has mixed them with others, it is the gas companies with which the greater part of this suit is concerned. It is, I think, common knowledge that the original capital of a gas company was a capital upon which they were at liberty to earn dividends up to 10 per cent., and this they were unable to exceed. If no alteration whatever had taken place in that original arrangement they would still be at liberty to earn that dividend on their original capital. I think it was in 1875, or 1876, that they obtained relief from the rigid limit of that dividend and were enabled to adopt the sliding scale. The result of that change has been that from that period until now they have distributed some six and a half millions in dividends over and above what they would have been able to pay had they been kept to their original limit.
I think that the noble Lord who is in charge of this Bill will confirm my recollection when I say that the gas company, either as coincident with the change in their system of paying dividend or by some subsequent provision, altered their original capital from £100 to either £240 or £250 a share, not by issuing fresh capital but merely by providing that the nominal value of the capital should be so proportionately increased, a matter that is not without value when we consider the phrase which I think the noble Lord somewhat incautiously used when he said the desire of this Bill was to enable a dividend to be paid upon the capital expended. It is not upon the capital expended that this Bill will provide a fair dividend, but upon the capital expended and expanded in the manner that I have mentioned.
What is the justification that is urged for this relief? It is that the war has fallen with a heavy hand upon the gas companies, and that the restrictions under which they are placed by their statutory obligations prevent them from earning a fair market dividend for the shareholders. If a company obtains statutory privileges, and subjects itself as a return to statutory restrictions, is it right, as soon as these statutory restrictions press upon them, to come and ask that they should be released when they have, to the extent that I have already stated, the statutory advantages which were conferred upon them? I think that it is wholly wrong, and I cannot understand what case can be made out for the 20 relief of the shareholders in gas companies that cart be denied to the innumerable number of humble individual cases who have suffered a wrong far greater than will fall upon the shareholders of the gas companies by the incidence of the war.
Let us take the ordinary case of the small shopkeeper, a person to whom the use of gas is of the greatest possible consequence. If the shopkeeper was under fifty lie has been torn from his business, and that business has to be carried on as well as it can be by those whom he has left behind. The profits that he formerly earned are now represented by the small pay that he receives as a soldier on active service and the separation allowance that is given to his wife. Upon that class of person the hand of the war has fallen with a far more heavy and crushing effect than it has upon the collective bodies of the shareholders of the gas companies. Yet it is upon them that is to be placed the burden that is necessary in order to pay this increase to the gas company shareholders. It seems to me unfair and unjust, and also most unwise, if the shareholders of the vast corporations are to be able, by the exercise of their wide and far-reaching influence, to induce the Government to come to their rescue. In these circumstances how is the Government going to refuse to come to the rescue of other people in exactly the same position? The misery and the mischief of this war fall with impartial hand, and it is quite impossible that the Government can relieve each individual and each interest from the loss and the suffering that ensue.
If it were possible I should be far inure ready to support a general Bill than I am to support a Bill which makes a selective discriminination, and attempts to relieve only a body who frequently, as the noble Marquess has pointed out, are represented by large financial interests. It is, I know, true that there is a considerable amount of shareholding in this company, and that a great number of the small shareholders are workmen of the company itself, but the wages of these workmen have already been increased very nearly 100 per cent., and it max well be doubted if the small shareholders will get any great advantage out of this Bill compared with the extra cost that they will be called upon to pay for the gas that they consume.
I certainly would not take upon myself the responsibility of attempting to prevent 21 the Second Reading of this Bill, but I cannot say that I agree even with the Report of the Select Committee. I do not think that the Government ought to step in and throw upon a class of consumers the burden of the loss of any trading concern; and if, indeed, the inability of the gas companies to pay a fair dividend has been due to the fact that the Government has improperly restricted the price of their residual outputs, the fair and businesslike thing to have done would be to fix their residual products at the market rate regulated by the conditions of the war, and no:, to have attempted to benefit the people who use these products at the expense of the people who use gas.
Notwithstanding this, recognising as I do that this matter was considered and discussed before a Select Committee of another place who heard all the arguments that could be advanced—and I believe heard learned counsel—and recommended that the dividends should be increased to one half of what they were, I should not be prepared to oppose the Second Reading, but I submit that there is no justification whatever for going beyond the Report of that, Committee and increasing by 50 per cent, the margin which they allowed and laid down.
Finally, I cannot conclude without saying that I regard with great regret the way in which this matter has been brought forward, not of course in this House. But it is common knowledge that there has been an elaborate campaign in which the shareholders in the gas companies and these kindred companies have been circularising extensively, and that pressure has been brought to bear upon members of the House of Commons by w hat, after all, is nothing but a group of financial interests.
§ LORD PARMOORMy Lords, I think that this is a most dangerous Bill for all companies whose rights depend upon Statute in the same way as in this Bill. At the present moment it is proposed, by the action of different Departments, to increase prices which now are under statutory guarantee. Therefore on some other occasion, under different conditions, it would be a precedent for lowering and diminishing the statutory rights which other companies have in some special circumstances which may arise at a particular time. I am bound to say, with regard to what is proposed in this Bill, that I agree 22 with Sir Frederick Banbury—namely, that interfering with a statutory charter is a proposal of the most dangerous character, because in this country statutory rights as regards companies are considered to have the soundest foundation, which is recognised in the giving of a larger number of years purchase for statutory undertakings as compared with what is given for undertakings of another character.
Let me say a word upon a point dealt with by the noble Lord who spoke last—namely, as to the history of this matter, with which many of us are very familiar. What is known as the sliding scale was originally introduced in the case of the London Gas Companies, and the great fight was for a fair arrangement as between the gas consumer in London and the gas companies. The result of the sliding scale was to make a partnership between the gas consumer and the gas producer. I think that that is an admirable arrangement and it is one which has worked exceedingly well, although, as the noble Lord who last spoke pointed out, it has eventuated in the payment of six and a-half millions in dividends which otherwise could not have been paid. Every one knows that the history which he stated is perfectly accurate—namely, that there was originally a standard dividend, but under the sliding scale more than the standard dividend could be paid if the conditions of the trade allowed it.
Let me refer to what was said upon this point by the noble Marquess, with whose opinion I entirely concur. The partnership between the gas consumer and the gas company involved a partnership in what is called the residual products—that is to say, the gas consumer in London has an interest in the proper sale of the residual products, practically to the same extent as the gas company. The gas company in certain circumstances receives an enlarged dividend and the consumers received a reduction in price. What has happened now? These residual products have been given a fictitiously low price, which is to the disadvantage of the gas company. But what is overlooked is that it is also a disadvantage to the London pas consumer, who had a vested interest under the sliding scale system in these residual products and a share in the profits derived from them. I by no means desire to criticise the fact that sulphate of ammonia is cheap for the agriculturist. 23 I agree with the noble Marquess that it is a great advantage to the agriculturist. But why should this be made an excuse for placing a special charge on the London gas consumer? To my mind there is no connection between the two.
I think this is a dangerous Bill. It is one of those Bills which may have been rendered necessary by the constant interference with matters of price and matters of wages, so that really almost every element in our industrial life has come under the dominion of official Departments. This is a further step in the same direction. I ask your Lordships to notice that Parliament is not asked to give this advantage to the gas companies. The gas companies are entitled to go before the Department and to ask for that Department's sanction. That is a very different matter. Are all the prices to gas consumers and all the profits of gas companies to be placed under the jurisdiction either of the Board of Trade or the Local Government Board? That is what it comes to. You are substituting for a statutory Parliamentary protection the mere action of a Department. The only justification for this Bill, although I think it is very slight, is to be found in the recommendations of the Select Committee.
THE EARL OF PLYMOUTHMy Lords, the discussion so far has almost inevitably been entirely upon the gas question. I suppose this was the main reason for the introduction of the Bill. But there are other companies concerned besides the gas companies, and I want to say a word for the water companies, which I believe come under this Bill. I am quite sure that there are a great number of water companies which do not pay and never have paid large dividends. They also have a very great, proportion of small shareholders, and it seems to me hard upon them that they should get no relief whatever until their dividend has fallen by one-half—say from 5 per cent. to 2½ per cent. No reference has been made to the controlled companies but great consideration has been shown to the controlled companies by the Government, and without a Bill being passed by Parliament certain of the controlled companies—the dock companies—have just lately been able to increase their charges. The noble and learned Lord, Lord Parmoor, shakes his head. Am I wrong?
§ LORD PARMOORThey could not by Departmental action increase statutory 24 charges, beyond which they are not allowed to go.
THE EARL or PLYMOUTHThen I must have made a mistake, and they only get relief within their statutory charges. It must be taken into consideration that this is a war measure. It is for the period of the war only and for the prescribed time after the close of the war. There have been many measures passed through Parliament which are war measures but which were thought necessary, though some of them—certainly one of them—pressed very hardly upon the owners of some industries. I am referring to a measure with regard to coal. But I think it should be looked at from a broad point of view and during the period of the war is it unreasonable that these companies should have some relief if their dividends sink beyond a certain point? I do not discuss the question of departing from the recommendations of the Select Committee; I am not prepared to say anything about that. But at the same time I feel that, so far as small water companies are concerned, they would get a very small measure of relief front this Bill if the noble Marquess opposite succeeds in altering the Bill back to its original form.
THE EARL OF DONOUGHMOREMy Lords, I desire in a few sentences to thank the Government for bringing this Bill forward. I have felt for some time that the question was one that wanted dealing with. Your Lordships are aware that there were about ten or a dozen Bills introduced into Parliament in this session to deal with this point, and I am glad that His Majesty's Government dealt with it in the way they did—namely, by appointing a Select Committee and by treating the matter as a whole. Several of your Lordships in speaking—my noble friend opposite (Lord Buck-master) among them—mentioned the fact, which is obvious, that the importance of this matter will arise really in Committee. I do not wish, therefore, to take up time in discussing Committee points. I know it is the usual habit of your Lordships to support Committees; I think on the w hole we generally take that view. At the same time, I ought to point out to your Lordships that this matter was evidently very thoroughly gone into in another place. There were no fewer than three divisions on this very point as to the difference between the half and the three-quarters, and in every case the three-quarters won by a substantial majority.
25 The noble Marquess (Lord Crewe) partly explained this by pointing out that these gas companies are powerful corporations, and no doubt they took very thorough steps to put their views before hon. Members. At the same time the noble Marquess will permit me to say that the distinguished body with which he is concerned (the London County Council) in no way fails in that direction. There is no public body which is more efficient in placing its views before Parliament, either through your Lordships' House or in other ways in the Committee rooms upstairs. I am glad that this matter is going to be raised in Committee. At the same time I thought it right to point out that evidently the change from the half to the three-quarters has been no capricious action of the House of Commons. The matter was very thoroughly considered there, and I have no doubt that it was for reasons that entirely satisfied it that the House departed from the recommendations of the Select Committee.
§ LORD SOMERLEYTONIf I may, I will say a word or two in reply to the speakers who have asked questions on the Bill. The noble Marquess the Leader of the Opposition referred to the prices of residuals. These prices were fixed at a fair figure and any increase would be too small, according to the best of my information, to affect prices or dividends. This is really a question for the Ministry of Munitions, who, I believe, would not at all object to any review being made of these prices.
Lord Balfour of Burleigh asked why we should place the great and the small companies together when they are so different, and he inferred that it was a great hardship on the small companies to be put in with the others. In reply I would point out the great difficulty of picking and choosing between companies. The applications of the companies under this Bill, if it becomes an Act, would be dealt with according to their own special merits; and it is not to be assumed that, all will get equal relief. Each will be judged on its own merits; and if a good case is put forward for any particular township or any particular district that case would be judged entirely on its merits.
§ LORD SOMERLEYTONI am informed that this is, at any rate, the intention of the Government; and I believe it is in the Bill. However, I will find out afterwards if the noble Lord will allow me to do so. There is a limit fixed in the Bill. The noble and learned Lord, Lord Buckmaster, quoted some words of mine. I do not think he quoted them exactly as I intended to state them. I think he quoted me as saying that a fair dividend should be paid, but what I thought I had said, and what I think I said, was that interest should be paid on the capital expenditure, which is very nearly the same but not quite.
§ LORD BUCKMASTERIt was not interest on shares which was in my mind but the actual expenditure of the capital.
§ LORD SOMERLEYTONI understand the point brought forward by the noble and learned Lord. I think that some consideration should be given under this Bill to those who have invested their money in undertakings of this kind as well as to people who have invested their money in other businesses. In regard to another point raised by Lord Buckmaster, may I say that under the sliding scale five-sixths of the advantage, or disadvantage, of a change of price must fall on the consumer and one-sixth must fall on the shareholders. If the latter have benefited by £6,000,000 the consumer must have benefited by £30,000,000. This seems to be a fairly good argument in reply.
With regard to what was also said by Lord Buckmaster as to the position of a shopkeeper, I would point out that if a shopkeeper is hard hit there is nothing to prevent him putting up his shutters, closing his shop, and taking up another line of business, as he has no statutory obligations. But the companies with which we are dealing are under statutory obligations and have to continue their business whether it pays or not.
A further question was raised with regard to the statutory companies being under the control of the Local Government Board or of the Board of Trade. I would point out that all statutory companies must be to some extent under the control of the Government; and I hope that they will be allowed to proceed with this Bill, which I believe is entirely necessary. If I have not satisfactorily answered all the questions that have been raised, I trust your 27 Lordships will understand that I have done my best to do so; and these points may be considered further in Committee if the House desires to do so.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House.
§ LORD SOMERLEYTONOn Friday, if your Lordships please.