HL Deb 17 August 1921 vol 43 cc831-81

Order of the day for the House again to be put into Committee read.

Moved, That the house do now resolve itself into Committee.—(The Earl 4 Lytton.)

On Question, Motion agreed to.

House in Committee accordingly.

[The EARL of DONOUGHMORE in the Chair.]

Clause 31:

Limitation on powers of the tribunal to increase charges.

31.—(l) The rates tribunal when first fixing the standard charges shall prescribe and report. to the Minister a limit beyond which an increase in those charges shall not be lawful without reference to Parliament.

(2) The Minister shall submit the report for approval to both Houses of Parliament, and upon a resolution being passed by both Houses of Parliament approving the report, either without, modifications or subject to modifications agreed to by both houses of Parliament, the report shall have effect as if enacted in this Act, subject, however, in the event of modifications being so agreed to by both Houses of Parliament, to such modifications.

LORD SUMNER moved to leave out subsection (1). The noble. and learned Lord said: This clause, the first subsection of which I urge your Lordships to strike out, is one which, as you will see, requires the Rates Tribunal, when first it fixes the standard charges, to prescribe a limit. beyond which an increase in those charges shall not be lawful without reference to Parliament. The effect of that is only visible when one considers the machinery which the Rates Tribunal is to work. By the by, I might remind your Lordships that the Rates Tribunal is not the one which we discussed a good deal yesterday—namely, the Amalgamation Tribunal, the names of the members of which appear in the Bill —but it is another Tribunal which I assume to be a continuation of the Rates Advisory Committee which, as some of your Lordships know, has been doing extremely useful work for some time under the presidency of Sir Francis Gore-Browne—a very competent body, as one would assume.

As you will see from Clauses 29 and 30, the first duty of the Rates Tribunal is to fix a schedule of rates to be charged for the carriage of merchandise in a very great variety of classifications, and also combinations as to distance. It is to be submitted to the Rates Tribunal by the constituent companies, and then the Tribunal is to hear all parties interested in the matter and to settle the schedule of charges. it is upon the result. of the schedule of charges so fixed that the prosperous working of the railway company from the point of view of the shareholders will depend.

In days gone by, before competition was abandoned and control was substituted, and when it was still thought possible that the people who were interested in an undertaking were the people who would best understand how to conduct it prosperously, there was a system of charging which was based upon maximum rates, and a very intelligible system it was. The undertakers applied to Parliament for powers to construct a railway; they made their own calculations and estimates; they took the risk- of what they did; and they were left a free hand—originally a very free hand—in exercising their rights. The form of Parliamentary control then was that maxima were fixed in the Act, and the railway company was entitled to charge the rates within those maxima, according as they found it best likely to attract business. The system here is that a Rates Tribunal, presided over by an eminent King's Counsel, is to do what normally would have been hammered out be hard experience by the railway companies themselves—namely, to discover a system of rates which would enable them to earn a reasonable return for their undertaking without driving their customers away.

It is recognised in the Bill that the Rates Tribunal will have to meet two difficulties. One is that in calculating a rate when everybody who is interested and is desirous to be heard is entitled to be heard, you are extremely likely to be led away—I do not say led astray—by the representations of traders and others whose chief desire is to get the smallest rate possible; and there- fore the railway company, which after all has to live out of these rates, must have its position protected by a specification as to what is to be the calculation to be taken account of by the Rates Tribunal in order to reserve to the railway company a proper return for its undertaking. Accordingly, in Clause 58, it is provided that the railway company is to be entitled to what is called a standard revenue, and the charges which are to be fixed in the first instance for each amalgamated company by this Tribunal are to be such as will, together with other sources of revenue, result in securing for the railway company the standard revenue therein defined. I will not trouble your Lordships with the definition of it.

The standard revenue is carefully hedged round by various provisions for the benefit of the railway companies themselves, and no doubt that represents the result of a tough, and I hope a successful, fight by the directors of the railway companies in the course of the process which is called agreement, though I think some term less descriptive of amity might have been better chosen for what went on before the Bill was introduced. The Rates Tribunal is, after all, beginning a new dispensation without any practical experience of their own, and with the whole experience of the past pretty nearly wiped out—thanks to the time that has elapsed since pre-war days, and the condition (I use no harsher term)—in which State control has reduced the railways; and it is recognised that the rates cannot be fixed in the first instance with any such confidence in their being the right rates as would warrant their remaining for any long time unchangeable and unchanged. Accordingly, by Clause 59, subsection (1), it is provided that the Rates Tribunal shall review the standard charges at the end of the first complete financial year, and then at the end of each succeeding year.

Thus, there are to be annual reviews of these standard charges, and it is provided, assuming that there is proper, careful work and that mere temporary fluctuations are eliminated and so forth, that if the standard charge which has been fixed is not enough to secure to the railway company that which is reserved to it in the Bill under the term standard revenue, then the Rates Tribunal shall, unless, in their opinion, owing to change of circumstances, the deficiency is not likely to continue, make such modifications in all or any of the standard charges and such a corresponding general modification as they may think necessary to enable. the company to earn the standard revenue. Now that is not an easy undertaking for the Rates Tribunal, but at any rate, it is rational and it is intelligible.

The Rates Tribunal, after hearing the people who want the rates to be cut, and after hearing the railway company's representations as to what its expenses, and so forth, are likely to be, says:"We will make a tentative fixing of the charges for twelve months and then the Statute says we are to revise them." I should think every one would agree that at the beginning it would be very little more than a matter of guesswork for the Rates Tribunal, because you must remember that all these economies which we hear of as the result of amalgamation may, and probably will, be very slow to materialise. One of the Schedules saddles the amalgamated companies with a large part of the persons employed in the older companies, and though they may cut down the number of men they employ they will not be able to cut down the amount they pay them. Under Clause 15 there is always looming in the background the Minister, set in motion by interested parties who want money spent for their benefit, which may run to the requirements of alterations and extensions involving hundreds of thousands of pounds. Therefore, during the first twelve months, when the railway companies are feeling their way and seeing whether they can get back their normal traffic in abnormal times, trying to find out whether they can get the public to forget what they had to put up with during the war and become again willing customers, the first fixing of standard charges must be very tentative. What the Rates Tribunal will say is:"All you gentlemen can come back in twelve months after we have had some experience of this, and, if it is necessary, we are empowered to alter it, and we shall alter it." The railway companies are assured that if they cannot earn their standard revenue then these charges will be increased.

But it is precisely at the moment when the Tribunal has a minimum of information and a complete absence of experience, that the Statute requires it to fix the upper limit beyond which it cannot subsequently raise the standard charges, and that limit is to be stereotyped by being communicated to the Minister, and, thereafter, no increase above that is lawful without reference to Parliament. Another Bill; another inquiry; another stormy passage through one House of Parliament, if not two. I put it to the noble Earl, whose explanation of this miraculous enactment I attend with interest and with hope of instruction—Is it possible to do more to produce a deadlock at the expense of the railway companies? You say to the railway companies:"We are fixing the standard charges in the dark, we are fixing an upper maximum limit, equally in the dark. We can change the lower one, but the upper limit we cannot change, and if we fix the upper charge and it turns out to be unremunerative, if we make a mess of fixing the maximum charge, there is nothing for you to do but to come to Parliament. In any case you will have to carry on the railways on an unremunerative basis until you get a Bill passed, if ever you do; you will be to the bad all that time."

There is evidently a desire to make a hybrid out of two perfectly distinct and separate systems. By one system you fix the high maximum, and then let people get their own rates by higgling the market. On the other hand, the system of the Bill is to dry-nurse the railways and trades from the cradle to the grave and give them periodical revision, which will have the advantage, at any rate, of bringing them into Court year after year with a chance of getting three sensible gentlemen to hear what they have to say.

There is one way out, and I imagine it is the way which the three sensible gentlemen will take if they have the courage to resist the clamour which I have no doubt will immediately be raised. That is, to say to the railway companies, when they begin their duties,"How high would you like to have this maximum fixed? You know more about it than we do, but neither of us know much. You fix the maximum so high that it cannot, with any reasonable probability, be too low, then we shall always be able to adjust the standard charge year after year to that result which Parliament intended—namely, the result which will enable you to get your standard revenue—while the demands and interests of the traders are considered as far as is within the limits of economic possibility."

If the Tribunal took that step you can imagine what would be said about them, and if they do not take that step, if they try to fix the charge at the beginning when they know little or nothing at all about it, they are obliged to take the maxi mum risk that can be taken of bringing the railway companies to the bad at the end of the year, by finding that the standard charges are not sufficiently remunerative to produce the standard revenue. It is all done at the risk of the railway companies. They have to pay outgoings, wages, and materials, carry all their traffic (by Statute they are bound to do so), the traders are entitled to have their goods carried at the fixed standard charges; and if the standard charges do not bring in enough to pay the standard revenue, and it cannot be met because the standard charges cannot be raised in the following year, it is the railway companies that are to the bad, and no one else.

The noble Earl will probably reply that what I am saying is a travesty of the operation of the clause, and that certainly, in the hands of the three magicians who are to be appointed, we need not expect any such dire results. If we are to walk by faith in this matter it may be so. But what I want to find out is, What is the good of this fixed maximum charge at all? Who is benefited by it? It hampers the Rates Tribunal; indeed, more, it shackles them. They are bound hand and foot. It compels a further reference to Parliament and compels the railways to go on trading at a loss until Parliament intervenes for their protection. A nice prospect for the shareholders ! And who gets any benefit out of it at all? It is in the power of the Rates Tribunal to put a maximum limit so much out of the picture that it becomes, in working, what I think it is in design, a mere piece of camouflage.

I can imagine no explanation of this except that it is a sop thrown to intransigeant traders in order to pacify them, who, if they are pacified, will be more easily pacified than I should have thought. They were told that the Tribunal was to be bound to protect them by fixing a maximum that could never be exceeded without the consent of Parliament. What is the good of it? I am still left where I have always been ever since I started thinking over this clause. I ask the question and get no answer. If I am told that no answer need be forthcoming, because it has all been agreed somewhere else, my reply is that I ask it precisely for the purpose of investigating these bargains out of doors, these agreements between the parties concerned, which take away from the Chambers of the Legislature the practical moulding of legislation.

We are told that, if they are content, surely we might be content too. I am not content with something that I cannot understand. If we can be made to understand, not only how it works, how it is hoped that it will work, how it is believed that it will work, but also what conceivable good it does, then our objection might be overcome. But, for the time being, I confess that it seems to me to be an attempt to utilise the system that is abandoned as part of a new scheme into which it does not fit, and where it can only do harm.

I am all the more fortified in that view if a quotation that has been supplied to me is correct. I have the opinion of the Railway Rates Advisory Committee, set up under the Ministry of Transport Act, to the same effect. The quotation is from paragraph 22 of the summary of that Committee's conclusions, in which it was stated— No limitation, by way of maxima or otherwise, should be placed upon the rates to be fixed by the Tribunal, either generally or when any variation is made. The railway companies should be prohibited from charging any rates above the standard rates fixed by the Tribunal, hot should be entitled to, apply to the Tribunal to increase the standard rats, or any of them, and any body of traders sufficiently representative of the trades affected should be entitled to apply to the Tribunal to reduce the standard rates, or any of them. It may or may not be a wise thing to commit the solution of an economic conflict to the, determination of a judicial and a semi-legal body; but surely, when you have done it, you ought to have the courage of your opinions and trust that body.

It is not fair to send before that. body the two contestants, the, traders and the railway company, and to say that the railway traders may demand such rates as they can satisfy the Tribunal are right and proper, but that the railway companies shall come into court with one hand tied behind their backs, because, before anything whatever is done and any experience has been gathered, the Rates Tribunal has, rightly or wrongly, been compelled to come to a conclusion that has no reference whatever to the actual facts.

Amendment moved— Page 29, lines 1 to 5, leave out subsection (1).—(Lord, summer.)

THE MARQUESS OF CREWE

Before the noble Earl replies to the, formidable speech of the noble and learned Lord, I venture to intervene for a moment, because this Amendment brings back to me two happy summers which I spent as a member of the Joint Committee presided over by the Duke of Richmond many years ago, who were sitting, I think, for something like ninety days in the two sessions, engaged in fixing maximum rates. That, as the noble and learned Lord has said, is dead and gone, but I am disposed to agree with him that the clause in the Bill attempts to revive the ghost of that system, while combining it with an entirely different scheme.

This is not a moment to discuss the question of the standard profit as applied to the railways. It is obviously a very arguable question as to whether the railways need to be provided with a standard profit. In the past, many railways have earned no profit at all, and the system, which is here laid down, of insuring, under Clause 58, the profits obtained in a certain series of years, is one which is, no doubt, open to discussion. But having adopted that system, it must be a necessary consequence that, in order to earn that profit, the railways must be permitted to charge— either by way of tolls, or fares, or terminals, or however they can get it—a sufficient sum to earn their profit; arid if they do not earn it, and the maxima are so fixed in a given year as to prevent their earning it, I agree with the noble and learned Lord that they appear to be unfairly treated. I confess that I agree with hint also that this clause, as it stands, seems to be one of the many attempts made by His Majesty's Government to have things both ways; that is to say, to get the advantage, if it be an advantage, of the semi-nationalisation which is provided by this Bill, along with the incompatible advantage of a system of regulated freedom, such as that under which the railway companies worked in the past.

But what I really want to know from the noble Earl is what is going to happen. The Rates Tribunal, in the first instance, is going to fix a scale of maxima applicable to the different groups, and these maxima are to be submitted to Parliament. I notice that the noble and learned Lord, by moving to strike out only subsection (1) of Clause 31, seems to have left subsection (2) in the air. I take it that this would go also, if his first Amendment were carried. When the tribunal has fixed these maxima, the Minister, having looked at them, is obliged to report them to Parliament. A Resolution is to be passed by both Houses of Parliament approving the Report. It is inconceivable that the House of Commons would approve a most intricate and detailed recommendation of that kind without inquiry.

What I want to know is whether the noble Earl contemplates the setting up of another Committee like that of which I was a member and have the most delightful recollections, a Committee which sat for two years, and which was constituted in order to fix the scale of maximum rates, that is to say of rates which, with certain exceptions, were generally applicable. That system was greatly tempered by the enormous number of special rates which, by the agreement both of traders and of the railway companies, were applied to relieve the difficulties of permitting the railway companies to charge as much as they liked, or, according to the well-known phrase, as much as the traffic would bear within the maximum. These special rates amounted to hundreds of thousands in number. Of course, the maxima had to be fixed high; in fact, they were and are very seldom charged.

The point to which I want the noble Earl to reply, if he would be so good as to do so, is as to whether this provision does not mean a complete re-opening by Parliament of the whole question of fixing of rates, because, if it does, it is clear to us all that it must detract greatly from the value of the Bill, and must postpone a final settlement of the exceedingly difficult question of the transport of goods at a price which can be reasonably remunerating to the promoters of the different railway lines and also tolerable to the traders and others who have to send goods by them.

THE UNDER-SECRETARY OF STATE FOR INDIA (THE EARL OF LYTTON)

My Lords, the noble Marquess who has just sat down has called your Lordships' attention to one small technical objection in the form of the Amendment of the noble and learned Lord. I do not dwell upon that, however, because I assume that although the Amendment is to leave out subsection (1) the intention is really to get rid of the whole clause, and therefore I will argue the matter from that point of view. We have had a very interesting speech from the noble and learned Lord, and it is certainly not my intention to say that he has given a travesty of the machinery of the Bill. On the contrary, he has given an extremely lucid, clear and, as far as I can judge, accurate description of the machinery of the Bill.

I have nothing to complain of in the description which he has given of the machinery, but I confess that it was with growing surprise that I listened to the very able speech of the noble and learned Lord — surprise that the speech should have come from that quarter, because I could not help feeling all through that the noble and learned Lord was making the very speech which the Government has made and would make on many occasions in answer to Amendments calling in question the principle of this Bill. As the noble and learned Lord has made what I could not help feeling was my case, I must try to make, in reply to him, the case which I am quite certain he would make if this clause were in the Bill in the form in which he desires to put it, or, in other words, if the Bill were without this clause altogether. I will try to explain what I mean.

The noble and learned Lord asked in whose interests this clause could conceivably have been inserted. He pointed out quite accurately that the clause was a limitation upon the powers of the Tribunal, and that the clause certainly was not in the interests of the railway companies, who had to make a living out of these rates; and then he asked: In whose interests, therefore, can this clause have been inserted? Besides the Tribunal and besides the railway companies who live on these rates, there are the travelling public., and the railway-using public, who are vitally affected by an increase in the rates and fares of the railways, and it is in the interests of those people, the railway users, that this clause is inserted. When I say that I was surprised that the speech should have come from that quarter, I say it because, as a rule, from the noble and learned Lord and those who are usually associated with him on the other side of the House, the Government is severely criticised for departing from the usual practice of procedure, and, in so far as they do that, injuring or affecting the interests of the public.

The noble and learned Lord has explained quite truly and clearly that up to the introduction of this Bill the practice has been for railway companies, under their Statutes, to fix themselves the variations of rates and fares up to the limit of the maximum decided by Parliament which is set forth in their Statutes; in other words, the railway users are protected by the Statutes from an increase of charge beyond the point at which it is fixed by Parliament. Than, the noble and learned Lord went on to say, again quite truly, that we are departing from that practice and that we are setting up in the place of Parliament a technical body of experts. I was glad to not ice that he paid a tribute to the experience and authority of the Rates Committee, which has been working for two years under the Ministry of Transport Act, and since the Chairman of the new Rates Tribunal will be the same as the Chairman of the Rates Committee, I assume that he will have confidence in this new Rates Tribunal. In future, instead of the railway companies, this new expert body will have the fixing of actual rates.

Now, those who represent the traders and railway users and the general public, have protested against the suggestion that this new body should be put not only in the place of the railway companies in. fixing actual rates, but in the place of Parliament, which has up to the present fixed the maximum beyond which the railway companies must not go. The noble and learned Lord, I think, realised that that was probably the explanation of this clause, because he spoke of it as a hybrid of two systems— an attempt to reconcile the old system, by which maxima were fixed by Parliament, and the new system, by which the rates are to be fixed by an expert non-Parliamentary body; and the noble Marquess, Lord Crewe, who supported him, referred to this clause as reviving the ghost of the old system.

The facts which prompted those two phrases are correct, but I venture to suggest that there is another and more accurate description. This is a concession, on behalf of the Government, to those representing the railway users, by which they leave in existence some portion at any rate of the system which they are endeavouring to change, and the position of the railway users at present is this. They say:"Although the railway companies may make variations in their charges, rates and fares, we, at any rate, know the limit up to which we may have to pay. We, however, much object to taking away from us altogether that safeguard—the fact that these charges which so materially affect our trading interests, may be put up to any extent, and we may not know at all what are the limits of the liability which we may be put under." They have, therefore, urged upon the Government to leave in the Bill some maximum so that they may know, at any rate, what is the limit of their ultimate possible liability, and it was as a concession to those who represented this public interest, the traders and users of the railways, that the Government agreed to leave in the Bill that degree of safeguard to them and that feature of the system which, in other respects, is being swept away.

Lord Crewe asked me what we thought would happen if this clause stands and the Rates Tribunal makes a report to Parliament in favour of some increase of the charges beyond the maximum which they have in the first instance laid down. I am not in a position to give any more information to the noble Marquess than he can derive from thinking over the situation himself. I cannot tell him what Parliament in those circumstances would do. 1 think it is extremely doubtful that Parliament would set up a Parliamentary Committee to investigate the report of a Committee which, I think on all hands it must he admitted, must have as much experience as, if not greater experience than, can be found on any Committee of Parliament. I imagine, therefore, that Parliament would simply decide by Resolution either in favour of accepting the recommendations of this expert body or not. However, I may not be justified in saving that. I cannot say, because either House of Parliament might, I imagine, decide to refer the matter to a Select Committee.

TILE MARQUESS OF CREWE

Perhaps I might mention that the words of the Clause strike me as almost inviting procedure of that kind— upon a resolution being passed by both Houses of Parliament approving the report, either without modifications or subject to modifications agreed to by both Houses of Parliament,… Those words seem to me to invite a detailed examination of the proposal.

THE EARL OF LYTTON

I am not prepared to say that it was an invitation, but, of course, I admit that it leaves such a procedure open and I am no more competent than the noble Marquess to say what the procedure of either House should be. I would, however, urge your Lordships very much not to be moved by a speech which represented very clearly the views which the Tribunal would take on this matter, and the views which the railway companies would take on this matter, but to consider also interests which, except so far as I have been able to do so, have not been voiced in this debate—namely, the interests of the railway users—and not to strike out of this Bill a clause which was left in as a protection to them and the striking out of which would arouse very strong hostility and objection, and would make them feel that a concession which the Government had made in their interests had gone from the Bill, and that to that extent; therefore, it was less entitled to their support than it is at the present time.

LORD STUART OF WORTLEY

My Lords, it is right to say that the railway companies were free to dispute the propriety of this clause, and they exercised that freedom in another place, and although they were not successful in getting this clause removed, they are free to ask that this Amendment be carried, and they would desire it to be carried. The very—I might almost say brilliantly— ingenious explanation of the noble Earl seems to me to fail from this point of view. Where are these users of railways, what kind of users are there, who will not have the fullest representation at all stages and on the hearing of all questions before the Tribunal under the provisions of Clause 43, which gives a right to be heard to— all parties whom they consider entitled to be heard, together with any representative body of traders who may desire to be heard or any person who may obtain a certificate from the Board of Trade that he is, in the opinion of the Board of Trade, a proper person.… I should like to know what class of traders, freighters, passengers, even stowaways, would not get before the Tribunal under those extremely comprehensive words?

I submit that this is not only a concession wanting in logic, but a concession to persons who want really to be heard a second time and to have again a question decided in their favour on the principle of "-Heads I win, tails you lose," because if this provision for the maximum charges is ever to come into operation, it can only come into operation in circumstances which must be such that expenses have so risen that the power to adjust charges to revenue has ceased to give to the companies that security for their dividend which, hereafter, is to be a maximum dividend, without which they cannot possibly carry on. Really, after all, the idea of raising the cost reminds me of the fable—I forget whether it is Æsopian—about killing the goose for the golden eggs, because the logic of the hitherto unrepresented users of the railways cannot be set up on its legs even by the defence of the noble Earl, because they would get bad railways with starved revenues and no resources out of which to make improvements, unless the railways were in a position at least to earn the dividend which Parliament is invited by this Bill to say is a fair return for the capital invested, and to earn a dividend without which the ordinary investor will not risk his money. It is difficult to conceive in what cases this maximum limit can be maintained, and I hope therefore that the Amendment will be carried.

LORD ASKWITH

I cannot but think that the noble Earl made a rather halfhearted defence of this clause. He spoke of agreeing with the noble and learned Lord as to his description of the machinery of the Bill. He spoke of a degree of safeguard which some of the traders thought they would get from this clause. I cannot think that the degree of safeguard would be anything comparable to the expense and delay which would ensue to those traders by having this clause in the Bill. The settling of these maxima, as I know from experience, is a matter of time and difficulty, and months and months will be lost on red tape. These Tribunals are already overweighted, and they have more than they can do. The railways will not be able to settle down to peace and contentment if a vast number of the officials of all the railway companies are continually engaged before these Tribunals, and if uncertainty is to exist for a long time as to what these rates are to be. Nothing can be of greater advantage to the traders themselves than to have, as soon as possible, certainty, and although there may be a few sets of traders who might desire to retain these obsolete ideas of a maximum, I feel sure that when they come to consider the effects of the expense and delay of keeping on with the haggling over rates, they will realise that they will be more than compensated for allowing this clause to go by the board.

THE EARL OF PLYMOUTH

I wish to say a few words upon a point which has not been touched upon, and that is that. this Bill really does away with all competition. I am personally concerned in a small railway company, a railway and dock company. I cannot forget that the very reason for forming it was to set up a competing company in order to keep rates down. I want to point out that the effect of the amalgamation of railways on these dock groups does away very largely with the whole effect of competition between the railways. Though one's interest is to a great extent in the success of the new group, I cannot put away from my mind the importance of the condition that rates and charges in competition were by a natural process kept from undue increase, and I hope the House, in coming to a decision, will remember that there is now an absence of that competition. It would naturally be more in the interests of big railway combinations to increase their rates and charges if they could make a reasonable case before the Tribunal for so doing. I think the traders' and freighters' point of view ought to be kept in mind.

LORD EMMOTT

My only point is the paint of view of the trader in this matter. I have never heard the subject discussed, but I have listened most carefully to this debate and, even from the traders' point of view, I cannot see for the life of me how the Rates Tribunal can do this work with any advantage in the time that is given them. If it has to be done, Lot it be done later on when they have time to deal with it. But so far as I can see, a great deal of their time will be spent in fixing not only the actual charges—that is another point—but this future maximum charge which, for the time being, is a purely fanciful one. I think it will interfere with their immediate duty of fixing the actual rate. Therefore, so far as I can see, even from the traders' point of view, it would be an advantage rather than a disadvantage that this clause should go out. At some later date it may be advisable to fix another lot of maximum rates and charges, but if I am correct in supposing, as I think I must be, that this Rates Tribunal must fix these maximum rates when they fix the first standard charges, I think it is asking them to do too much and it will delay what is really necessary—the fixing of the first standard charge.

THE EARL OF LYTTON

I assure your Lordships that my defence of this clause was certainly not half-hearted, and that I cannot possibly accept the Amendment of the noble and learned Lord. Knowing the feeling that was expressed on this matter while the clause was under discussion in another place, I feel certain that a view which has not been voiced in this House will be very strongly voiced if the Amendment is carried.

I represented this as an Amendment which was ill the interests of the railway companies, and I am not surprised, therefore, that directors of railway companies should support it. But, when noble Lords like Lord Emmott, who professes to speak for traders, and Lord Askwith, who has put down Amendments to this Bill in the interests of traders, give me no support I can only say that, so far as the traders' case is represented in this Home, the arguments I have ventured to put forward in their interests are not supported. Since I have had no support from any quarter of the House, and since those who profess to speak for traders tell me I am mistaken in thinking this Bill is in their interests, I shall not put the House to the trouble of a Division and shall he content with negativing the Ammendment of the noble and learned Lord. If your Lordships carry the Amendment it will leave the Government free to re-insert the subsection in another place if they so wish.

LORD SUMNER

May I in the first place thank the noble Marquess for drawing my attention to the imperfect form of this Amendment as it stands on the Paper. I would ask the leave of the House to alter it so as to move out the whole clause. I entirely disclaim any antipathy to the traders' point of view. Nor was this Amendment placed on the Paper after consultation with any railway representative.

THE EARL OF LYTTON

I did not suggest it.

LORD SUMNER

I believe the traders are fully able to look after themselves. They are too sensible to suppose that this clause is any good to them, and that is why nobody is here to defend it in their favour.

Amendment, by leave, withdrawn.

THE LORD CHAIRMAN

The noble and learned Lord having withdrawn his Amendment, I had better put the Question in this way—that the clause stand part of the Bill.

On Question, Clause 31 disagreed to.

Clause 32 agreed to.

Clause 33 (Application of schedules to non-amalgamated companies).

THE EARL OF LYTTON

The two Amendments that I have on the Paper are for the purpose of improving the drafting.

Amendments moved— Page 29, line 26, after (" than ") insert (" amalgamated companies and ") Page 29,line 34, after (" prescribed ") insert (" time and in the prescribed ").—(The Earl of Lytton.)

On Question, Amendments agreed to.

Clause 33, as amended, agreed to.

Clause 34:

Repeal of existing provisions.

(2) In the case of the rates fixed under paragraph (v) of subsection (1) of section six of the Cheap Trains Act, 1883, or in any case where it is proved to the satisfaction of the rates tribunal that any charge in operation on the fourth clay of August, nineteen hundred and fourteen, and fixed under any subsisting agreement or special statutory provision was originally so fixed for valuable consideration, the rates tribunal shall, and in any other case may, by order continue the charge, subject to such modification as to the tribunal may appear fair and equitable, and in making such modification the tribunal shall, as far as practicable, provide that the relative position between persons entitled to the charge and other persons as existing on the said fourth clay of August shall not be prejudiced or improved.

LORD SUMNER moved, in subsection (2), after"the rates tribunal shall," to insert"by order continue the charge." The noble and learned Lord said: I.can put this very briefly because it is on the" theme on which I addressed your Lordships yesterday without any success. Subsection (2) of Clause 34 proposes that in certain cases (one of which is this) where it is proved to the satisfaction of the Rates Tribunal that any charge in operation on the fourth day of August, 1914, and fixed under any subsisting agreement or special statutory provision, was originally so fixed for valuable consideration, the Rates Tribunal shall do—what? Respect it? Give effect to a statutory bargain for past consideration paid or performed? Not a bit of it—shall continue to charge, subject to such modification as to the Tribunal may appear fair and equitable.

As a lawyer I am entirely unable to reconcile myself to a statutory provision in a general Bill which says that where there is a statutory bargain, the existence of which is admitted and which is proved to have been entered into for valuable consideration passing from the persons who are now entitled to the benefit of the clause, then this Tribunal shall be entitled to alter it; provided only that it does it in a way which it thinks fair and equitable. In this connection"equitable"means nothing; it means only fair in four syllables instead of one.

THE EARL OF LYTTON

If the noble and learned Lord will read the last words of the clause he will see what"fair"is defined as meaning.

LORD SUMNER

Yes, I am quite aware of it."Fair ". is defined—at least I do not call it a definition, but still there is a proviso which says:"shall as far as practicable provide that the relative position between persons entitled to charge and other persons as existing on the said fourth day of August shall not be prejudiced or improved." I am unable to understand how you can make an alteration in a man's contract any more palatable to him by telling him that, whatever he may think, you think that it is fair and that his relative position to the party on the other side has neither been prejudiced nor improved. The point, of course, needs only to be stated. It may be good or it may be bad. I think probably it will be considered old-fashioned. Certainly it is out of harmony with much that we have in this Bill.

If the day should ever come in which anybody could afford to subscribe fresh capital to any railway, I cannot conceive how the railway can appeal with any prospect of success if Parliament has once made it quite clear that the policy of sixty or seventy years at least is abandoned, and that those who obtain a Parliamentary bargain, in consideration of something which they do or concede generations ago, are not to be allowed to have the full benefit of it hereafter, but are to be called upon to have it revised by some Tribunal, however respectable, which is required to do what it thinks fair and what it considers will leave the relative positions of the parties as they were. The railways are entitled, upon a bargain like that, to any benefits that may accrue from it, and it will, be remembered against those who seek to raise new capital in the way in which it was raised of old that there is nothing really left of the old security that was afforded by a Parliamentary bargain. I beg to move.

Amendment moved— Page 30, line 29, after (" shall ") insert (" by order continue the charge").—( Lord Sumner).

LORD GAINFORD

I have an Amendment dealing with very much the same subject. It is a matter upon which I feel very strongly, because no railway director who has entered into a bargain with any trader would think of trying to seek to escape from that bargain owing to an alteration of the circumstances due to the Government having introduced a Bill to amalgamate railways. In the Act of 1863, when amalgamation was the subject matter which was brought before Parliament, it was laid down that any bargain— I am not quoting the Statute, of course— or any arrangement or agreement entered into between a railway company and a trader, for consideration given, should not be prejudiced by the amalgamation. The amalgamation was not to put an end to the bargain or agreement that had been entered into. I have on the Paper an Amendment which deals specifically with existing agreements of this character, and 1 have in my mind several eases where the railway company have acquired land, sometimes by Parliamentary powers, sometimes voluntarily, from individual traders, and have, in consideration of the traders having sold them a portion of land, undertaken to make a special arrangement for the conveyance of the trader's goods.

I am a director of a firm which possessed a colliery on one side of a hill. We made a railway over the hill, and by a stationary engine hauled the material up to the top of the hill, let it down on the other side, and manufactured the whole of the produce of the colliery into coke at the other side of the hill. The railway company came along, and said to us:"We are prepared to buy this railway from you, and to undertake to carry the traffic for you." We said:"We are quite agreeable, if you will do it on the same terms on which we can convey our own minerals over this hill by our own private line." By agreement, the railway company acquired that line, which has now been dis- mantled, and will probably never be utilised again. For the same rate at which we could convey our minerals over our own private line, they have taken this traffic several miles round on a level gradient, instead of on the steep gradient over the hill.

We have no alternative now but to accept that agreement. It may be said that the terms are unreasonable. On the other hand, we, as a company, say that the terms are not unreasonable. The railway company entered into this bargain with us for better or for worse, and we did the same, and they are bound to take our traffic for us under the agreement, and have no right to increase the charge, seeing that we have now no power ourselves to take the material over our own disused railway. We say that the I improvement in machinery would enable us to convey now our material over our old railway more cheaply than we conveyed it at the period when the agreement was entered into with the railway company, and we further say that we ought not to be compelled to pay more because the railway company have to employ an excessive number of railway men, and cannot carry the material in a roundabout. way at a profit. We contend that the railway company ought to adhere to the agreement they entered into.

May I give one other case —I could quote several. The Consett Iron Company had a staith on the Tyne, to which they imported all their iron ore—600,000 tons a year. The railway company said: We would like to have this staith," and they came to Parliament to get power to obtain it. The railway company, having got the staith, entered into a bargain with the Consett Iron Company that if at any time hereafter, they were not able to carry out their bargain they would reconstruct this staith and enable the Consett Iron Company to again use their own staith. I am told that that is now practically impossible. The Consett Iron Company, in consideration of the whole of their ore being brought into the Tyne dock or into the South dock at Sunderland at special rates, allowed the railway company for all time to convey-the whole of their foreign imported ore over their system, instead of the Consett Iron Company themselves taking it into the Tyne onto their own wharf and dealing with it there in their own way. If there were any alteration or any breach of that agreement, or if it were annulled the Consett Iron Company to-day would lose an enormous sum of money. It is not a question of the relative positions of two competing persons. It is a question in the interest of one particular company, and of that company being able to secure its iron ore at a price at which it could have obtained it for itself if it had the advantage of the use of its own wharf, which it possessed before the year 1898.

I do not wish to detain the Committee by giving other examples, but it seems to me that one thing only can be done by the Government if it is going to advocate the breach of an agreement or of a contract, and that is to pay compensation to any person who is injured by the alteration or the breaking of an agreement of this kind. For these reasons I have thought it better to address the remarks I have to make upon the Amendment of the noble and learned Lord rather than upon the Amendment in my own name which comes on later.

THE EARL OF LYTTON

I agree with the noble Lord that this Amendment does not require long discussion, but when he says the case has only to be stated I would qualify that by saying,"Yes, if it is stated fairly." With all deference to the noble and learned Lord, I do not think his statement of the case was a fair statement, because he gave your Lordships to understand that the effect of the Bill was that where in the past, in return for some valuable consideration of land or so forth, railway companies have made an arrangement with an individual or company to quote them in future a special rate below the general rate to the company, that bargain was by this Bill set aside and was not in future to be carried out.

Before I argue the case on its merits let me make it quite clear to your Lordships what the Bill does. The Bill says that where in the past, for valuable consideration, a special rate has been quoted by the company, now, in days when, in consequence of increased costs in all directions, it is necessary to revise the general rates of the company, that special rate quoted in return for valuable consideration is to be placed in precisely the same relative position to the general rates charge as it was at the time when it was made. That is to say, if the special rate was half the general rate it shall remain half the new increased rate; if it was a quarter, it shall remain a quarter. Whatever the proportion of the reduction given as a concession over the general rate, that proportion shall.be retained to the new general rate fixed by the Rates Tribunal.

His Majesty's Government considers that an arrangement of that kind is fair to the parties that made the original contract, and to prevent a modification to that extent would mean that the contract to-day would have a far greater additional value to that which it had at the time it was first made. As a proof that I am not wrong in claiming this provision as a fair one, I would remind your Lordships that probably the most classic instance of a special rate, in return for valuable consideration of this kind, was that made between the London and North Western Railway Company and the St. Helens Corporation. In 1862 the St. Helens Corporation parted with a canal and a railway to the London and North Western Railway Company, and in return were given by the company a special rate for the carriage of goods on their line. That special rate they have enjoyed ever since. Now the St. Helens Corporation has agreed that the proposition which the Government makes in this Bill is a fair one, and they say that if they are left with the same relative advantage over other users of the railway, they have nothing to complain of. That is a class of case on behalf of which the noble Lord spoke, and since they are satisfied that the arrangement in the Bill is a fair one, I hope your Lordships will support the Bill as it stands and resist the Amendment of the noble and learned Lord.

LORD SUMNER

I should be extremely sorry if 1 had represented the terms of this clause in any way that would be considered unfair, but I remain entirely impenitent. I am under the impression that my description of the clause was correct, and I do not desire that it should be anything more. If I was not fair to the clause in the sense of putting the best complexion on it that could be put on it, I did not wish to do that. I wish to let the House know what the clause means and does. What the clause means and does—and the noble Earl accepts it—is that I, who make a contract say, in the year 1860, for a consideration which is entirely executed and passed, that for a hundred years I am to have a particular specified benefit out of it, shall not have the benefit of that contract in the year 1921 or 1922, but something like it, something put upon me which will not give me the full contractual advantage and make it as profitable to me as it was in 1860 or in 1914. That is to say, there is substituted for a contract for one hundred years to carry my goods at a fixed sum per ton, a contract that I shall have them carried for me at a sum that will be no more burdensome to the railway company than the fixed sum was in years past and no more beneficial to me than it was in years past.

That may be a very nice thing for a corporation to agree to when it is doing the handsome thing in the name of its ratepayers, but I am thinking of the individual who does not consent to have it altered; and I do not understand why in the case of people who may be hard, iron-fisted men, but have a contract for which they have paid, and want to have the benefit of it, their determination should be interfered with because the St. Helens Corporation is doing the handsome thing by the London & North Western Railway Company. The noble Lord behind me has given very cogent instances of what will happen. I trust your Lordships will support me in saying that a contract is a contract even in an Act of Parliament.

LORD ABINGER

I do not think the noble and learned Lord who has just spoken has quite realised that the reason why all these contracts are being altered is that a great war has happened. The whole transport of the country is upset, and it has to be rectified and put in order again. The

transport of this country means very much the same as what water meant to the Incas of Peru many years before your Lordships lived. That country depended entirely on the question of irrigation. It had a population of 36,000,000, but since its water has been cut off it has now a population of not more than 4,000,000 or 5,000,000. That was all brought about by the Spanish Conquest. Here we are in a similar dilemma. We have been face to face with the greatest war that civilisation has ever seen, brought about to a large extent by the democracy which the noble Lord always represents, and always hopes to represent, as we all do up to a certain point, though we have to give way in certain circumstances. The war has brought about an entire transition of motives and ideas. A railway company is nothing more than a motor-car, and the Government is in the position now of having to ask the public to change the gearing of the motor-car, which is getting worn out.

The noble Lord, Lord Gainford, who entered into such admirable contracts must remember he is only one person in this country. Why should the whole country have to pay for the benefit of that one man, and that one company he represents, when we have all been suffering? I really think we ought to support this Amendment because it merely says that people who have entered into contracts before this Act came into force shall continue those contracts upon the same terms. If the ratio of a gear were two to four, the ratio of the gear should remain the same.

On Question, Whether the proposed words shall be here inserted?—

Their Lordships divided:▀×Contents, 36 Not-Contents, 55.

CONTENTS.
Crewe, M. Ampthill, L. Gainfoid, L. [Teller.]
Salisbury, M. Askwith, L. Kintore, L. (E. Kintore.]
Avebury, L. Montagu of Beaulieu, L.
Beauchamp, E. Balinhard, L. (E. Southesk.) Redesdale, L.
Doncaster, E. (D. Buccleuch and Queensberry.) Bledisloe, L. Sandys, L.
Cawley, L. Saye and Sele, L.
Grey, E. Channing of Wellingborough, L. Shandon, L.
Kimberley, E. Clifford of Chudleigh, L. Stanley of Alderley, L. (L. Sheffield.)
Mayo, E. Clinton, L.
Midleton, E. Denman, L. Strachie, L.
Portsmouth, E. Desart, L. (E. Desart.) Sumner, L. [Teller. ]
Hood, V. Ebury, L. Terrington, L.
Hutchinson, V. (E. Donoughmore.) Elgin, L. (E. Elgin and Kincardine.) Vernon, L.
NOT-CONTENTS.
Birkenhead, V. (L. Chancellor.) Churchill, V. Hylton, L.
Gladstone, V. Killanin, L.
Sutherland, L. Grey of Fallodon, V. Knaresborough, V.
Bath, M. Peel, V. Lambourne, L.
Curzon of Kedleston, M. Lovat, L.
Abinger, L. Ludlow, L.
Ancaster, E. Ailwyn, L. MacDonnell, L.
Bradford, K. Annesley, L. (V. Valentia.) Merthyr, L.
Chesterfield, E. Anslow, L. Muir Mackenzie, L.
Chichester, K. Armaghdale, L. Ranfury, L. (E. Ranfurly.)
Clarendon, K. Charnwood, L. Rathcreedan, L.
Eldon, E. Clwyd, L. Roundway, L.
Fortescue, E. Colebrooke, L. Saltoun, L.
Lucan, E. Decies, L. Somerleyton, L. (Teller.)
Lytton, E. Faringdon, L. Stanmore, L. [Teller.]
Malmesbury, E. Gisborough, L. Stuart of Wortley, L.
Plymouth, E. Glenarthur, L. Treowen, L.
Strafford, E. Gorell, L. Weir, L.
Hamilton of Dalzeli, L. Wigan, L. (E. Crawford.]
Chilaton, V. Harris, L.

On Question, Motion agreed to.

Resolved in the negative, and Amendment disagreed to accordingly.

Amendment moved— Page 30, line 30, leave out ("modification") and insert ("adjustment"). (The Earl of Lytton.)

LORD GAINFORD

I suggest that the words"if any"should be inserted after the word"adjustment." I think the Tribunal should have power not only to make an adjustment but to leave the position as it is if, in their opinion, no adjustment is required.

THE EARL OF LYTTON

I accept the addition.

THE EARL OF LYTTON

The next Amendment is drafting.

Amendment moved— Page 30, line 32, leave out (" modification ") and insert (" adjustment "). (The Earl of Lytton.)

LORD GAINFORD had given notice of an Amendment to insert at the end of the clause the following new subsection— (3) This section shall not apply to any agreement entered into before the passing of this Act whereby or whereunder any railway or other property has been required or any easement has been obtained by any railway company from any person other than a railway company and in which stipulations with respect to facilities, services or charges form the consideration or part of the consideration for the acquisition of such railway property or casement. The noble Lord said: I am not going to repeat the speech I have just made, although I feel inclined to give some further illustrations, in which my own firm are not interested, where traders would be prejudiced by the action of the Government in passing the clause as it stands. I am going to make an appeal to the Government to consider, between now and Report stage, whether, in the event of hard cases being brought to the notice of the Tribunal, it would not be possible for compensation to be paid. I think some hard eases may exist, and if he will consider the matter before Report stage in order to try and secure justice I shall be grateful.

Amendment moved— Page 30, line 36, at end insert the said new subsection.—(Lord Gainford.)

THE EARL OF LYTTON

I will, of course, consult those who advise me in this matter on the point. I cannot hold out any hope that an Amendment could he inserted in the Bill to meet it. I will put before them, however, the matter which the noble Lord has raised, and discuss it with them.

LORD GAINFORD

In that case I do not want to press my Amendment.

Amendment, by leave, withdrawn.

Clause 34, as amended, agreed to.

Clause 35 (Subsequent modification of standard charges):

THE EARL OF LYTTON

Both my Amendments to this clause are drafting.

Amendments moved— Page 30, line 42, after (" person ") insert (" for the purpose ") Page 31, line 12, leave out from (" exceptional ") to the end (if the line and insert (" charges under that section ").—(The Earl of Lytton.)

Clause 35, as amended, agreed to.

Clauses 36 to 38 agreed to.

Clause 39:

Review of competitive exceptional rates.

39. If and whenever representations are made to the Minister by any body or persons who, in the opinion of the Board of Trade, are properly representative of the interests of shipping or canals, that exceptional rates are being charged which are competitive with coastwise shipping or canals in such a manner as to be detrimental to the public interest, and which are inadequate having regard to the cost of affording the service or services in respect of which the rates are charged, the Minister shall (if satisfied that a prima facie case has been made out) instruct the rates tribunal to review such rates, and the rates tribunal may, after hearing all parties whose interests are affected, vary or cancel such rates or make such other order as may seem to them expedient.

LORD MONTAGU OF BEAULIEU moved to insert"or road transport"after"shipping or canals." The noble Lord said: I rise to ask the Government to consider the inclusion of road transport in this clause. At the present moment the railway interests and the shipping interests are represented, and I maintain that the road interests should also be represented, as constituting a more important form of traffic than either canals or shipping at the present moment. It might be said that road transport is not of a statutory nature, and that therefore it ought not to be represented, but personally I do not think that that argument affects the question. As far as that point is concerned, shipping itself is not statutory. I suppose, again, that barge owners can convey produce on the canals at any price they choose, just as carriers can upon the roads. In these circumstances, I think it is only fair that the road interests should be included. They are demanding equality of treatment, without prejudice to the question, which may arise later on, as to whether the railways should be given power to run their own road transport, which is not within the purview of this Bill. I shall be glad if your Lordships can see your way to support this Amendment, which is considered very desirable by various road interests of an important nature.

Amendment moved— Page 34, line 35, after (" canals") insert (" or road transport ").—(Lord Montagu of Beaulieu.)

THE EARL OF LYTTON

This clause was inserted in the Grand Committee in another place for the purpose of protecting shipping and canal interests from the unfair competition of exceptional railway rates. As I understand the noble Lord, he wishes to place those who run lorries and motor wagons on the roads in the same position as these canal and shipping undertakings. I would submit to the noble Lord that the circumstances of the parties whom he represents in this Amendment are in no sense comparable with those to which the clause at present applies. Coastwise shipping is in a peculiar position, in that it is absolutely vital to the life of the country. Without this coastwise traffic, it would be impossible for large ports such as London, Liverpool, Hull, Bristol, and so forth, to be promptly cleared in case of an emergency. Canals, on the other hand, are statutory undertakings. They have charges which themselves are regulated by statute. The road transport to which my noble friend's Amendment applies is in an entirely different category. These road transport carriers are to-day competitors with the railway companies. The railway companies would have no voice in the rates which they might charge, and the noble Lord says that the road transport interests should have a voice in preventing the railway companies from reducing their charges, in case it would affect the amount charged by these motor lorries.

I submit that the noble Lord's Amendment is entirely unreasonable, and would be unfair in its operation. It would, for instance, enable these road transport carriers to come before the Tribunal and, in cases where a railway company was charging a particularly low fare for market tickets, they would be entitled to say that such a rate was unfair to the people who carry passengers along the roads. Seeing that these motor lorries and road transport generally are under no statutory obligations and have no undertakings towards the public, it seems to me unreasonable and unfair to ask that they should be heard before the Tribunal, when that Tribunal is considering what are the rates that should be charged upon the railways. The analogy which the noble Lord has endeavoured to set up between his road transport carriers and canals and shipping is not, I think, a consistent one, and I hope your Lordships will not accept this Amendment.

LORD MONTAGU OF BEAULIEU

In answer to the noble Earl, I should be glad to know whether, under the heading of road transport, he includes tramways; for tramways and motor buses around London might be serious competitors with the railways. It might happen that if the railways cut fares to the suburbs round London, they would kill the tramways equally with the road transport. Am I to understand that tramways have no power to apply to the Rates Tribunal, but that only the shipping and canal interests can do so?

THE EARL OF LYTTON

That is so under this clause.

Amendment, by leave, withdrawn.

LORD ASKWITH moved to leave out"instruct the rates tribunal to review such rates"and insert"refer the matter to the rates tribunal for review." The noble Lord said: I suggest these words to the noble Earl because they are more courteous and also more fair. A tribunal of this kind is not under the thumb of the Minister, and arbitrators are not generally "instructed"by the persons who appoint them.

Amendment moved— Page 34, line 42, leave out (" instruct the rates tribunal to review such rates ") and insert (" refer the matter to the rates tribunal for review").—(Lord Askwith.)

THE EARL OF LYTTON

I agree to that.

Clause 39, as amended, agreed to.

Clauses 40 ton agreed to.

Clause 43 (Settlement by tribunal):

THE EARL OF LYTTON

Both my Amendments to this clause are drafting.

Amendments moved— Page 37, line 22, leave out from (" hearing ") to (" any ") in line 23 Page 37,line 27, after (" person ") insert ("for the purpose and any other party whom they consider entitled to be heard ").—(The Earl of Lytton.)

Clause 43, as amended, agreed to.

Clauses 44 and 45 agreed to.

Clause 46 (Owners' risk rates):

THE EARL OF LYTTON

My Amendment is drafting.

Amendment moved— Page 38, line 35, leave out (" for any ") and insert (" where "), and after (" merchandise ") insert (" is ")—(The Earl of Lytton.)

Clause 46, as amended, agreed to.

Clause 47 (Through rates and fares):

THE EARL OF LYTTON

Both my Amendments are drafting.

Amendments moved— Page 39, line 38, after the second (" the ") insert (" said ten days or other "). Page 40, line 22, after (" rate ") insert ('' or fare ").—(The Earl of Lytton.)

Clause 47, as amended, agreed to.

Clause 48 agreed to.

Clause 49:

Collection and delivery charges.

(4) Any dispute as to whether or not any charge for the services of collection and delivery is reasonable shall be determined by the rates tribunal.

THE EARL OF LYTTON

My Amendment is drafting.

Amendment moved— Page 42, line 22, after (" reasonable ") insert (" or whether the length of notice for the termination of an agreement under this section is reasonable ").—(The Earl of Lytton.)

Clause 49, as amended, agreed to.

Clause 50 (Dangerous goods):

THE EARL OF LYTTON

This also is drafting.

Amendment moved— Page 42, line 41, after (" before-mentioned ") insert (" by-laws ").—(The Earl of Lytton.)

Clause 50, as amended, agreed to.

Clauses 51 to 53 agreed to.

Clause 54 (Publication of schedules o standard charges):

THE EARL OF LYTTON

There are three drafting Amendments to this clause.

Amendments moved— Page 45, line 34, after (" keep ") insert ('' open for inspection at its head office ") Page 45,line 36, leave out (" upon such railway ") Page 45,line 38, leave out (" open for inspection at its head office ") and insert (" upon the several railways owned or worked by the company ").—(The Earl of Lytton.)

Clause. 54, as amended, agreed to.

Clause 55:

Miscellaneous provisions as to rates.

55. The provisions contained in the Fifth Schedule to this Act (being provisions similar to those now contained in the various railway rates and charges orders) shall apply to the amalgamated companies and the railway companies to which a schedule of standard charges has been applied.

THE EARL OF LYTTON moved, after"shall," to insert"as from the appointed day." The noble Earl said: This is really only drafting. It defers the operation of Clause 55 until the appointed day, and in that respect makes it consistent with the rest of the Bill.

Amendment moved— Page 46, line 18, after (" shall ") insert (" as front the appointed day ").—(The Earl of Lytton.)

Clause 55, as amended, agreed to.

Clause 56 agreed to.

Clause 57:

Interpretation of Part III.

57. For the purposes of this Part of this Act, unless the context otherwise requires,—

The expression"railway rates and charges orders"means the provisional orders fixing maximum rates and charges appli- cable to the several railway companies made and confirmed by Parliament in pursuance of section twenty-four of the Railway and Canal Traffic Act, 1888.

The expression"prescribed"means pre- scribed by the rates tribunal.

LORD ASKWITH had on the Paper an Amendment in the definition of"fares," to leave out"and other," and to insert"rates for season and traders' tickets and other special contracts, and." The noble Lord said: I have put down these words with a view to ascertaining whether season and traders' tickets and similar contracts are intended to be included in the words"other charges"in connection with the conveyance of passengers.

THE EARL OF LYTTON

Yes, they are included.

LORD ASKWITH

Would it not be better to make it clearer?

THE EARL OF LYTTON

I ant advised that the Amendment is unnecessary, because these season tickets would be included in the words"other charges '' in the Bill. It is undesirable to insert an Amendment which is not necessary.

LORD ASKWITH

I do not move.

THE EARL OF LYTTON

I beg to propose a drafting Amendment here.

Amendment moved.— Page 47, line 8, leave out from (" exceptional ") to the end of line 11, and insert (" ' charges ' means charges below the standard charges, including special charges continued subject to adjustment under the provisions of this part of this Act, and the expressions exceptional rates ' and exceptional fares' shall be construed accordingly ").—(The Earl of Lytton.)

Clause 57, as amended, agreed to.

Clause 58:

Adjustment of powers of charging to revenue.

58.—(1) The charges to be fixed in the first instance for each amalgamated company shall be such as will, together with the other sources of revenue, in the opinion of the rates tribunal, so far as practicable yield, with efficient and economical working and management, an annual net revenue (hereinafter referred to as the standard revenue) equivalent to the aggregate net revenues in the year nineteen hundred and thirteen of the constituent companies and the subsidiary companies absorbed by the amalgamated company, together with—

(b) such allowance as may be necessary to remunerate adequately any additional capital which may have been raised or provided in respect of expenditure on capital account incurred since the fourteenth day of August, one thousand nine hundred and twenty-one; and

(2) Subject as aforesaid, the tribunal when fixing charges in pursuance of the provisions of this section shall fix such charges as in their opinion are best calculated to ensure the maximum development and extension in the public interest of the carriage by railway of merchandise and of passengers and their luggage, and shall accordingly ascertain as far as may be practicable the effect which the existing charges, or any of them, have had upon the merchandise or passenger traffic to which they are applicable, and in particular whether the application of such charges has tended or, if continued, would be likely to tend towards causing the increase or diminution- of the said traffic.

LORD STUART OF WORTLEY moved, in subsection (1) (b) to leave out"fourteenth day of August, one thousand nine hundred and twenty-one," and to insert first day of January nineteen hundred and thirteen and not included in the expenditure referred to in the last preceding paragraph." The noble Lord said: It must be remembered that 1913 was the last accounting year for the purpose of various standards before the war. Unless you take into account in adjusting charges the revenue and expenditure borne and undertaken so far back as that, although the works upon which it was spent did not come into operation until after the beginning of control, the company which made that expenditure will suffer an unjustifiable loss, because it will not be able to get the revenue which will properly remunerate it for the expenditure of that capital. It is true that, as a matter of fact, expenditure of that kind was not allowed in reckoning the interest which was allowed by the Government in its guarantee to the companies during the period of control. None the less, under the scheme and policy of this Bill it should be reckoned as a factor in the burdens undertaken, the proper remuneration of which should be calculated in adjusting charges to revenue in the future operations of the railways.

Amendment moved— Page 47, line 40, leave out from (" the ") to (" and ") in line 42, and insert the said words.—(Lord Stuart of Wortley.)

THE EARL OF LYTTON

I am prepared to accept the Amendment.

LORD ASKWITH moved, at the end of subsection (1) (b), to insert"unless it can be shown that such expenditure has not enhanced the value of the undertaking." The noble Lord said: These words occur in the next subsection, and it would be clearly unreasonable that capital should be remunerated which had not advanced the value of the undertaking.

Amendment moved— Page 47, line 42, after (" twenty-one ") insert (" unless it can be shown that such expenditure has not enhanced the value of the undertaking ").—(Lord Askwith.)

THE EARL OF LYTTON

I accept this Amendment.

LORD ASKWITH moved to leave out"subject as aforesaid"at the beginning of subsection (2). The noble Lord said: This Amendment is considered of great importance by many traders, because there has been a controversy as to whether the whole object of this Bill was to obtain an annual revenue, as in 1913, or to obtain the maximum development and extension of the public interest in the carriage of merchandise and passengers. As a matter of fact, the whole object of the Bill is neither the one nor the other, and it seems that it would be much fairer not to put one as being subject to the other, but to put both of them on an equality basis in these two subsections.

Amendment moved— Page 48, line 21, leave out (" subject as aforesaid ").—(Lord Askwith.)

THE EARL OF LYTTON

I am advised that this Amendment will not really make any alteration in the sense of the clause. This Tribunal has two duties to perform, and I am not aware that this Amendment would alter the relative importance of those two duties; but, if the noble Lord attaches great importance to it, I have no objection.

LORD ASKWITH

The next Amendment is consequential on the previous one.

Amendment moved— Page 48, line 23, leave out (" fix such charges as ") and insert (" have regard to the means which ").—(Lord Askwith.)

Clause 58; as amended, agreed to.

Clause 59:

Periodical review of standard charges and exceptional rates.

(2) The Minister may direct as respects any year after the third annual review that a review shall not be held, and the directions may extend either to all the amalgamated companies or to any one or more of those companies:

Provided that no such direction shall extend to any company which has applied to the Minister for a review, or in respect of which the Board of Trade on the application of any representative body of traders have requested that a review shall be held.

(4) If on any such review the rates tribunal find that the net revenue or the average annual net revenue obtained by the company (hiring the period on the experience of which the review is based is less than the standard revenue of the company, with such allowance (if any) as appears to the tribunal necessary to remunerate adequately any additional capital which may have been raised or provided in respect of expenditure on capital account incurred since the date upon which the standard charges were fixed in the first instance, and that the deficiency is not due to lack of efficiency or economy in the management, the tribunal shall, unless in their opinion owing to change of circumstances the deficiency is not likely to continue, make such modifications in all or any of the standard charges and such a corresponding general modification of the exceptional charges of the company as they may think necessary to enable the company to earn the standard revenue with such allowance (if any) as aforesaid:

Provided that no such modifications of the standard charges shall be made as will increase any of those charges beyond the limit imposed in pursuance of the provisions of this Part of this Act.

(6) Subject as aforesaid, the rates tribunal when modifying charges on any such review, shall have regard to the like considerations as when fixing charges in the first instance,

LORD ASKWITH moved to substitute"second"for"third"in subsection (2). The noble Lord said: This Amendment would give an opportunity to the Minister, if the third annual review was not necessary, of dispensing with it. In every year for the first three years there must be a review by the Tribunal, and then it is open to the Minister to make it in every third year. This Tribunal will be simply overweighted with the vast number of things it has to do. In any event, if it occurs that, in, the result, a two years review is sufficient the Amendment that I suggest would enable the Minister to get rid of the third year's review without detriment to anyone.

Amendment moved— Page 49, line 23, leave out (" third ") and insert (" second").—(Lord Askwith.)

THE EARL OF LYTTON

I accept this Amendment.

LORD ASKWITH moved, in the proviso to subsection (2), to leave out"representative body of traders ". and to insert"two or more bodies of persons representative of trade or a locality." The noble Lord said: This Amendment is in order that a single body of traders should not be able to prevent the Minister from 'stopping the review. He should have some considerable body, or bodies, of people who should come before him, and should give the reason for net having this review. Further, I have put in the words"or a. locality," which would allow bodies of persons who are representative of the-locality to make a complaint. As the Bill at preset stands it is only a representative body of traders who are allowed, and not a representative body in the locality.

Amendment moved— Page 49, line 30, leave out (" representative body of traders ") and insert (" two or more bodies of persons representative of trade or a locality ").—(Lord Askwith.)

THE EARL OF LYTTON

I am afraid I cannot accept this Amendment. The noble Lord said he thought it was wrong that a little body of persons should have these powers, but by his Amendment he would prevent a big body of persons having them. Surely it is right that such a body as the Federation of British Industries for instance, should be entitled to make these representations and that it should not be necessary for there to be two such bodies. Therefore, I object to the first part of the Amendment because it brings in two bodies, and I think that a body which is really representative, such as the Federation of British Industries might be, ought to have the rights given in the clause of itself without the necessity of another body being added to it. Then I submit this is not the proper place in the Bill in which to bring in representatives of a locality. A locality ought not to have any right of reviewing a general rate which is fixed for the whole country. Whereas, under Clause 35, a locality has the power to secure a partial revision of its rates, we are dealing here with a general rate for the whole country. Therefore, I submit it is not right that a locality should be given a locus standi.

Amendment, by leave, withdrawn.

LORD SUMNER

I beg to move an Amendment consequential upon the omission of Clause 31—to leave out the proviso to subsection (4).

Amendment moved— Page 50, leave out lines 30 to 33.—(Lord Sumner.)

THE EARL OF LYTTON

I beg to move the drafting Amendment which is on the Paper.

Amendment moved— Page 51, line 2, leave out (" rates ") and insert (" charges ").—(The Earl of Lytton.)

LORD ASKWITH moved, in subsection (6), to leave out"subject as aforesaid." The noble Lord said: This is a consequential Amendment.

Amendment moved— Page 51, line 8, leave out (" subject as aforesaid ").—(Lord Askwith.)

LORD ASKWITH had on the Paper an Amendment at the end of subsection (6) to insert— Provided that the tribunal shall have regard to the financial results obtained from the operation of any ancillary or subsidiary business carried on by the company, and if satisfied that the net revenue resulting therefrom is, having regard to all the circumstances', unduly low, may for the purpose of such review make such deductions from the standard revenue as they think proper.

The noble Lord said: I desire to move this Amendment in a slightly different form to that on the Paper. The expression"standard revenue"in the last line but one is not altogether accurate, and it would be more technically correct to say"charges which would otherwise have been fixed"as they think proper. I would ask the leave of the House to move. it in that form.

Amendment moved— Page 54, line 11, at end insert (" Provided that the tribunal shall have regard to the financial results obtained from the operation of any ancillary or subsidiary business carried on by the company, and if satisfied that the net revenue resulting then-from is, having regard to all the circumstances, unduly low, may for the purpose of such review make such deductions from the charges which would otherwise have been fixed as they think proper ").—(Lord Askwith.)

Clause 59, as amended, agreed to.

Clause 60 (Transitory provisions as to charges generally):

THE EARL OF LYTTON

My four Amendments on this clause are of a purely drafting character.

Amendments moved— Page 51, lines 23 and 24, leave out (" conveyance ") and insert (" carriage ") Page 51,line 24, after (" passengers ") insert (" or otherwise ") Page 51,line 25, leave out (" fourteenth ") and insert (" fifteenth ") Page 51,line 30, leave out (" fourteenth ") and insert (" fifteenth ").—(The Earl of Lytton.)

Clause 60, as amended, agreed to.

Clause 61 (Provisions as to charges in connection with private sidings):

THE EARL OF LYTTON moved, after subsection (4), and immediately before the proviso, to insert the following new subsection: (5) The Railway and Canal Commission shall not after the passing of this Act, exercise any jurisdiction with respect to the matters to which this section relates.

The noble Earl said: This is a small Amendment to make Clause 61 conform to Clause 27, and in that way prevent a conflict of jurisdiction. I beg to move.

Amendment moved— Page 53, line '27, at end insert the said new subseetion.—(The Earl of Lytton.)

Clause 61, as amended, agreed to.

Clauses 62 to 65 agreed to.

Clause 66 (Application of Part IV):

THE EARL OF LYTTON

I beg to move the group of Amendments which stand in my name on the Paper. They are entirely drafting.

Amendments moved— Page 56, line 1, leave out (" railways") and insert (" railway companies ") Page 56,lines 2 and 3, leave out (" the railways of ") Page 56,line 6, leave out (-fourteenth ") and insert (" fifteenth") Page 56,line 7, leave out (" and ") and insert (" including as respects") Page 56,line 8, after (" companies ") insert (" a joint committee of those companies ") Page 56,line 9, leave out ("the railways of") line 10, leave out ("and") and insert (''including as respects") Page 56,line 11, after ("companies ") insert "a joint committee of those companies '').— (The Earl of Lytton.)

Clause 66, as amended, agreed to.

Clauses 67 to 70 agreed to.

Clause 71:

Power of councils to give guarantees.

71.—(1) The council of any county or borough or district may be authorised by an order under the principal Act to guarantee or to join with any council, person, or body of persons in guaranteeing the whole or any part of the interest or dividends on any loan or share capital of a light railway company for such period and on such terms and subject to such conditions as may be approved by the Minister after consultation with the Minister of Health:

Provided that a council, before giving or joining in giving any such guarantee, shall, by means of voting papers, ascertain the opinion of the local government electors for the county or borough or district, as the case may be, on the proposal, and shall not give or join in giving the guarantee unless the majority of the answers are in favour of the proposal.

THE MARQUESS OF CREWE moved to omit all words in the proviso to subsection (1) after"Provided that," and to insert:"the procedure laid down in the Borough Fund Act, 1872, shall apply when a council propose to give or join in giving such a guarantee in like manner as it implies when a council propose to incur expenditure in opposing a Bill in Parliament." The noble Marquess said: This is not a large matter, but it has some substance. I can explain it quite shortly, because I understand that the noble Earl opposite has no objection to the Amendment which I propose. The point is that light railways eau be, guaranteed, or partially guaranteed, by county councils, borough councils, and district councils. But if your Lordships look at the Bill you will see there is a proviso saying that before such a guarantee can be offered it is necessary that a poll should be taken of all the electors of the local authority, whichever it may be.

It was pointed out to me by the County Council of the West Riding of Yorkshire, of which I was a member for many years, that in a large county the effect might be that the cost of taking the poll would be larger—and it is a most ludicrous result—than the sum required to be guaranteed. Therefore, it is proposed that instead of the procedure provided in the Bill the procedure under the Borough Funds Act of 1872 should be adopted; that is to say, that a majority of the whole council must concur in the granting of the guarantee. That is the procedure which has to be adopted in the case of the promotion of a Bill in Parliament by one of the local authorities named. It is only right to say that all I am empowered to put is the case of county councils. I do not know that borough councils and district councils would take the same view, but I think I am entitled to assume that they would, because it seems scarcely likely that they could be so much in love with the principle of the referendum that they would prefer to go to the trouble and cost of taking a poll to acting by a majority of the council.

Amendment moved— Page 58, line 32, leave out from (" that ") to the end of line 38, and insert the said new words. —(The Marquess of Crewe.)

THE EARL OF LYTTON

I accept this Amendment.

Clause 71, as amended, agreed to.

Clauses 72 to 74 agreed to.

Clause 75 (Facilities):

THE EARL OF LYTTON

The next Amendment is purely drafting.

Amendment moved— Page 61, line 31, leave out (" this Part of ").(The Earl of Lytton.)

Clause 75, as amended, agreed to.

Clause 76:

Allocation of receipts on worked railways.

76. Where under any Act or agreement passed or made before the passing of this Act any railway is maintained and worked on terms based upon the receipts front the traffic on such railway, the amount which shall be payable to the owning company out of such receipts shall be such as would have been payable to them if the rates, fares, tolls, dues, and charges in respect of such traffic had been the same as those in operation during the year nineteen hundred and thirteen, but not less than the amount actually paid in that year, and the balance of such receipts shall be retained by the company maintaining and working the said railway.

THE EARL OF ELGIN moved towards the end of the clause, after"year," to insert,"With the addition of an amount in respect of interest on capital expenditure at the same rate per annum as was payable by the Government to any such company in respect of the year nineteen hundred and twenty under the agreements or arrangements relating to the possession by the Crown of the railway of such company." The noble Emil said: I move this Amendment on behalf of the smaller railway companies who do not work their own lines, and whose lines are worked for them. The purpose of the Amendment is to secure that these companies shall receive any sums representing interest on capital expenditure incurred since the commencement of the war.

Amendment moved— Page 62, line 11, after (" year ") insert the said words.—(The Earl of Elgin.)

THE EARL OF LYTTON

I agree.

Clause 76, as amended, agreed to.

Clause 77:

Accounts, returns and statistics.

(2) It shall be the duty of every railway company to compile and render to the Minister the statistics and returns set out in the Eighth Schedule to this Act, sub-divided in the case of an amalgamated company in accordance with such operating areas as may be agreed between the Minister and the company, subject, nevertheless, to such variation as may from time to time be agreed between the Minister and the Railway Companies' Association.

Provided that the Minister may exempt any light railway company from the obligations imposed by this subsection to such extent as he may think fit.

Amendment moved— Page 62, line 35, after ("variation ") insert (" of those statistics and returns ").—(The Earl of Lytton.)

LORD ASKWITH moved, in subsection (2), after"variation," to insert"or exemption." The noble Lord said: This alteration would make it clearer that the Minister had the power to exempt.

Amendment moved— Page 62, line 35, after (" variation ")) insert (" or exemption ").—(Lord Askwith.)

THE EARL OF LYTTON

I cannot accept this Amendment. The clause imposes an obligation on all the railway companies to make certain returns, and it also provides a power varied in form. This Amendment of the noble Lord, if I understand it aright, would give power to the Registrar to exempt certain companies from making any returns. That, I think, is undesirable. The noble Lord may say that the Minister may not exercise this power, but as it is intended that every company should he subjected to the same obligation to provide returns, I do not want to have anything put into the Bill which would give. the companies the right to assume that they could demand to be put in a special position and to be exempted. That would only lead to pressure being brought to bear upon the Minister by individual companies to obtain such exemption. I do not know whether that is the intention of the noble Lord, but it appears to be the effect of his Amendment.

LORD ASKWITH

That was not the intention. My intention was that there should be an opportunity of not insisting upon returns being made when those returns were unnecessary. These returns absorb a lot of time in their preparation, and there may be cases in which railway companies might very well be relieved from the trouble and expense of preparing a mass of statistics which may not be necessary.

THE EARL OF LYWON

I am obliged to the noble Lord for his explanation, and I can assure him that his Amendment is not necessary. If any of these tables are discontinued that would be a variation under the clause as it stands. The insertion of his words would have the effect I mentioned, and I hope he will be satisfied by my assurance and not move his Amendment.

Amendment, by leave, withdrawn.

Clause 77, as amended, agreed to.

Clauses 78 to 82 agreed to.

Clause 83:

Application to Scotland.

83. This Act in its application to Scotland shall be subject to the following modifications:— (a)"Burgh"shall be substituted for"borough,""servitude"for"easement ":

Amendment moved— Page 65, line 35, after (" easement ") insert ('' and Secretary for Scotland,' for Minister of Health'").—(The Earl of Lytton.)

Clause 83, as amended, agreed to.

Clauses 84 to 86 agreed to.

First Schedule:

LORD CLWYD moved to omit from the list in column 3 of the subsidiary companies of the Western Group the"Festiniog Railway Company"The noble Lord said: I can explain in one or two sentences why I move this Amendment. There are two other narrow gauge railways operating in this district, and all who know anything of the conditions of the district know that the only way in which these three narrow gauge lines can effectively deal with the traffic and develop the industries of this region is by a system of unified control. Negotiations have been pending for some time in order to secure that result, and at last an arrangement has been reached between these three subsidiary lines by which this unification in management can be secured. It is obvious that if one of these railways— the Festiniog Railway—is attached to the Western Group, such unified control would be impossible. These three lines should all go in, or all go our., together. I do not think it is necessary for me to do more than to say that the local bodies in this district, and also the trade interests affected, are in favour of the Amendment. With these few explanatory remarks I venture to hope that the noble Lord in charge of the Bill will be able to accept the Amendment.

Amendment moved— Page 68, column 3, fines 39 and 40, leave out"the Festiniog Railway Company".—( Lord Clwyd.)

THE EARL OF LYTTON

This small railway is a narrow gauge line, and I understand from my noble friend that it is intended that it should' be grouped with other narrow gauge lines in the district. As that is in accordance with the grouping principle of the Bill, I am prepared to accept the Amendment.

THE EARL OF LYTTON moved to omit from the subsidiary companies of the Western Group"the Shropshire Railway (Nantmawr Branch) Company." The noble Earl said: This railway was inserted in the Bill in error. This branch is not a railway company at all; it is merely a bit of a line, and ought not to have been included in the Schedule. I beg to move.

Amendment moved— Page 69, column 3, lines 17 to 19, leave out (" the Shropshire Railway (Nantmawr Branch) Company).—(The Earl of Lytton.)

LORD TERRINGTON had on the Paper two Amendments to include in the constituent companies of the North Western, Midland, and West Scottish Group the"Hull and Barnsley Railway Company"and to omit that company from the constituent Companies of the North Eastern, Eastern, and East Scottish Group. The noble Lord said: By arrangement this matter was fully discussed on Lord Nunburnholme's Amendment yesterday, and I therefore do not move.

LORD AILWYN moved to add to the subsidiary companies of the North Eastern, Eastern, and East Scottish Group"the King's Lynn Docks and Railway Company." The noble Lord said: I move this Amendment on behalf of the King's Lynn Docks and Railway Company, who ask to be inserted in the Schedule of this Bill. They are supported in their action by the whole of the town and district round King's Lynn, and also by the traders and by the Great Northern and Great Eastern Railway Companies. I believe also that the North Eastern and Great Central Railway Companies are not averse from this Amendment. This is the only controlled railway company owning docks that has been left out of this Bill. They have been recognised for some time as a railway company, and they were taken over at the beginning of the war as a railway company, and made subject to all the rules and regulations regarding wages and hours that were issued.

I notice that the Minister of Transport, in Grand Committee, used these words:"There is no financial interest so far as I am informed in it"(the King's Lynn Dock Company). I beg to say that the Minister is not quite correct, because the Great Eastern Company have subscribed £25,000 capital, and a Great Eastern director now always sits on the board of the company. In conclusion, may I say that this Amendment was debated in Grand Committee, and was defeated by a small majority only. I beg to move.

Amendment moved— Page 70, column 3. line 47, after (" company ") insert (" The King's Lynn Docks and Railway Company ").—(Lord Ailwyn.)

THE MARQUESS OF SALISBURY

I have reason to object to the Amendment which has been moved by my noble friend opposite. Perhaps the noble Lord will be surprised that I should say a word on this Amendment, but I do it on behalf of my noble friend, Lord Erskine, who is detained from your Lordships' House by indisposition. He has asked me to represent to your Lordships the difficulty in which certain clients of his, if I may so call them, stand, if this Amendment is accepted. It seems that the dock of Boston stands in the position of a competing dock to the dock of King's Lynn. My noble friend shakes his head, but perhaps he will allow me to deliver my message. Those who control this undertaking represent that if the King's Lynn railway and dock have the great advantage of being amalgamated in this great group and they are left outside the effect will be that the great group will deflect all the traffic that they can so as to help the dock of King's Lynn to the detriment of the dock of Boston. That prima facie sounds to me good sense. The Boston people do not wish in the least to stand in the way of King's Lynn. They would be very glad that this Amendment should be accepted, but they plead that if King's Lynn is put in Boston should be put in as well. I do not pretend to be familiar with the locality, but I think it right that the interest of these persons should be properly laid before His Majesty's Government, and I hope they will take the matter into their consideration.

THE EARL OF LYTTON

I am afraid I cannot accept the noble Lord's Amendment and for reasons which have been made apparent by the speech to which we have just listened. Neither can I accept the Amendment to the Amendment suggested by the noble Marquess. The Boston dock municipal undertaking is not a railway at all. It is not a railway-owned undertaking and therefore does not come within the purview or title of the Bill, and I do not think it could, by any means, be included in the Bill. King's Lynn Dock and Railway Company, it is true, is a statutory railway company, but I submit to your Lordships that it is only technically a railway company. It is really a dock company which owns a number of sidings, and a little bit of branch line about a mile in length, which connects it up with I think the Great Eastern Railway.

It is therefore not a railway company at all; in fact, it is no more a railway company than is the Port of London Authority, and it might be some surprise to your Lordships to learn that the Port of London Authority, the Manchester Ship Canal, Bristol Corporation, and the Leith Docks, are all statutory railways, and there is no more reason for including the King's Lynn Dock and Railway Company in the purview of this Bill than there would be to include any other of these great undertakings which have in some cases even one hundred miles of sidings attached to their dock business. It is not the policy of the Government to introduce into this Bill, which is purely a railways Bill, any of these purely dock undertakings. It has been impossible to exclude the docks that are owned by railway companies, but to go out of our way to bring into the Bill an undertaking which is really a dock company, and only incidentally and technically a railway, would make very great difficulties, and for those reasons I regret I cannot accept the Amendment.

Amendment, by leave, withdrawn.

The First Schedule, as amended, agreed to.

The Second, Third, and Fourth Schedules agreed to.

The Fifth Schedule (Miscellaneous provisions as to rates):

THE EARL OF LYTTON

The next three Amendments are drafting.

Amendments moved— Page 80, line 26, leave out from"sum ") to the end of line 32. Page 81, line 25, at end insert: (2. Any difference arising under this paragraph shall be determined by the rates tribunal at the instance of either party, provided that where before any service is rendered, a trader has given notice in writing to the company that he does not require it, the service shall not be deemed to be rendered at the trader's request or for his convenience.") Page 81,line 33, leave out (" occupation ") and insert, (" accommodation ").—(The Earl of Lytton.)

The Fifth Schedule, as amended, agreed to.

The Sixth Schedule:

SIXTH SCHEDULE.
Act amended. Nature of Amendment.
The Railway and Canal Traffic Act, 1854 (17&18 Vict. c. 31). In section seven, for the words"for any horse fifty pounds, for any neat cattle per head fifteen pounds, for any sheep or pigs per head two pounds" there shall be substituted the words "for any horse one hundred pounds, for neat cattle per head fifty pounds, for any other animal five pounds.

LORD STRACHIE moved, after"pounds," to insert"for pigs per head fifteen pounds, for sheep per head seven pounds ten shillings." The noble Lord said: This Amendment is one which was put down and moved in another place. I imagine that the reason there was no discussion upon it was that it carne under the guillotine and compartment rules of the House of Commons upon Report, and the Minister gave merely this answer:"I regret I cannot accept this proposal. The extra value may easily be covered by insurance." It is very little consolation to farmers to be told, if their sheep or pigs are destroyed in a railway accident through no fault of theirs, that they have no claim because they have not insured them. In these days, as we all know, prices are falling, but at the same time profits are falling considerably; therefore, there is all the more reason why there should he some kind of insurance protection for farmers in this matter.

I may say at once that these figures which are given here were supplied to the honourable member who put this Amendment down in another place by the National Farmers' Union, who are most anxious that something should be done in this matter in order to put them in a better position than they are under the Bill. I should like to draw the attention of your Lordships to what was said in the Ministry of Transport Rates Advisory Committee's Report on the general revision of railway rates and charges. The Report was issued only last year. This particular matter is referred to on page 50 of that Report. What they say is— Railway and Canal Traffic Act, 1854, Section 7.—The Railway Companies are willing to con: cede an increase in the sums fixed by this section in regard to the amount of damages which may be recovered for loss of or injury to animals where no higher value is declared and extra compensation paid for the increased risk, and ask that other animals and values should be added to the list. We have already recommended amendments of the section which, while they increase the limits of value beyond the figures suggested by the railway companies, bring within the purview of the section all animals instead of as now only horses, meat, cattle, sheep and pigs. We think that the great increase in the value of live stock including many animals other than those enumerated makes these amendments in the value proper, and from the evidence give to us by the railway companies themselves we do not think any great burden will be imposed on the companies by the alteration. I should like to draw you Lordships' attention to the Sixth Schedule upon page 84 of the Bill.

Under the Railway and Canal Traffic Act, 1854, the Section said that as regards horses it should be £50, for any neat cattle per head £15, and any sheep or pigs £2. The proposed Amendment to that, which we are now discussing, is that there should be substituted for any horse £100, for neat cattle £50, and for any other animal £5. I should like some explanation from the noble Earl in charge of the Bill as to why this recommendation is entirely ignored. Not only do they not increase the value for sheep and pigs, but they actually leave them out entirely by name, and they simply conic under"other animals.- It is true as regards other animals they increase from £2 to £5, but that is not at all carrying out the recommendation of the Rates Advisory Committee's Report to the Ministry of Transport. I would venture to suggest to the noble Earl that it is very unsatisfactory to group valuable animals like pigs and sheep with rabbits and fowls, because that is what it comes to. In the past sheep and pigs were separately stated in the Schedule as animals for which compensation has to be paid, but now they are simply lumped together with all other kinds of animals.

The suggestion I have made is that sheep should be £7 10s. I am quite ready to admit that at the present moment £7 10s. is perhaps a rather high value to put upon sheep, but I would remind the noble Earl, and also the. House, that though I put down this Amendment of £7 10s. for sheep and £15 for pigs, it is only the maximum that has to be paid. A railway company would not have to pay £7 10s. for a sheep or £15 a head for pigs unless that sum or a larger one was the value. At the present moment probably sheep are not worth more than £6 per head, and the railway company would only have to pay £6 and not £7 108., but when we are legislating for a considerable number of years it is necessary to put in a high maximum because we know prices fluctuate and therefore there should be some safeguarding of the agriculturist and the maximum should not be too low. I would remind the noble Earl that the price of pigs at the present moment is very high. I believe the quotation is 28s. a score, and it is ridiculous to say that £5 would cover the value of a pig if it was lost. I hope the noble Earl will be ready to make some concession in this matter. It is a question which has never been discussed, and I hope he will give some reason why the Government do not attempt to carry out the recommendation of the Advisory Committee. They have ignored it entirely, and lumped all animals together, except in the case of horses and cattle, where, I admit, they have made valuable increases.

Amendment moved— * Page 84, line 33, after (" pounds") insert (" for pigs per head fifteen pounds, for sheep per heal seven pounds ten shillings" ).—(Lord Strachie.)

THE EARL OF LYTTON

As we have now reached the last Amendment on the Paper in this long and complicated Bill, I am sorry that I cannot give Lord Strachie the satisfaction of accepting his Amendment. This Schedule deals with Amendments made in this and other Acts, and this particular section deals with Section 7 of the Railway and Canal Traffic Act, 1854. That Section of that Act deals with the maximum of liability on railway companies for loss or injury to any animals carried on their line. The present limitation is £2 per head in the case of sheep and pigs, which in the Bill is raised to £5 per head. The Amendment would raise it to £15 per head for pigs and £7 10s. for sheep. I do not suppose, even when these maxima were fixed in 1854, that £2 covered the value of every animal carried on the railway. Certainly in recent years it has been true that animals of a much higher value than £2 have been carried.

But if £2 represented a fair and reasonable value in 1854 the Government hold that £5 is a fair and reasonable maximum to fix, proportionately, at the present time, and they consider it would be unreasonable to put a greater charge on the railway companies because occasionally some animals of a higher value might be carried. Such a case, as the Minister stated in another place, in the opinion of the Government, ought to be met by insurance. It is the duty of those who send valuable animals on the railway to provide against loss or injury by insuring them. In fixing what would be the reasonable maximum liability to the railway companies for animals generally they hold that the figure £5 inserted in the Bill is reasonable and that the amount to which the noble Lord's Amendment would raise it would be altogether unreasonable.

Amendment, by leave, withdrawn.

Sixth Schedule agreed to.

Seventh Schedule agreed to.

Eighth Schedule (Schedule of statistics to be supplied by railway companies of Great Britain in addition to those furnished under Railway Companies (Accounts and Returns) Act, 1911):

THE EARL OF LYTTON

My Amendment to this Schedule is purely drafting.

Amendment moved— Page 86, line 38, at beginning insert (" Freight receipts ").—(The Earl of Lytton.)

Eighth Schedule, as amended, agreed to.

Remaining Schedule agreed to.

House resumed.

THE MARQUESS OF SALISBURY

May I ask the Leader of the House when he proposes to take the Report stage of this Bill?

THE MARQUESS CURZON OF KEDLESTON

I propose to put it down to-morrow, if your Lordships consent.

LORD STUART OF WORTLEY

Will it be the first Order to-morrow?

THE MARQUESS CURZON OF KEDLESTON

I think it will probably be for the convenience of your Lordships, as well as for the despatch of business in another place, that we should put it down as first Order. In those circumstances would it not be desirable that your Lordships should meet earlier to-morrow also? Unless I receive any marked dissent from the House, I would propose that we meet at two o'clock to-morrow and that the Report of the Railways Bill be the first Order.