HL Deb 04 April 1922 vol 49 cc1065-127

Order of the Day fur the House to be put into Committee read.

Moved, That the House do now resolve itself into Committee.—(Viscount Peel.)

THE MARQUESS OF SALISBURY

My Lords, I am very anxious, if possible, not to take anything like a very hostile attitude to this Bill because I know the Government have put it forward with the very best intentions, and that it is designed to meet a want which really exists. That is admitted on all sides, but I think that there is something to be said before your Lordships decide to go into Committee on the Bill. The delay which has taken place since the Second Reading is certainly not to be regretted on one ground. In the interval there has been an opportunity for your Lordships and for those interested outside to consider the Bill in far greater detail than they were able to do before the Second Reading, and to see and appreciate how very great are the difficulties which stand in the way of legislation on this subject.

We really are very much in the dark about it. Your Lordships will perhaps remember that the noble Viscount, the Secretary of State for India, or some other noble Lord, stated upon a previous occasion that there was one remarkable fact in connection with this electricity question. The principal Act of 1919 contemplated a system of joint electricity authorities throughout the country. Electricity Com- missioners were appointed who were then to bring about the appointment of joint electricity authorities by voluntary means. It is a most astounding fact that there is not a single joint electricity authority yet existing in the country, much less are there any schemes which it will be the business of the joint electricity authority to put forward. Consequently, we are very much in the dark as to the working of this measure, as to its favour with the public, and as to the support which it receives in different parts of England. There seems to be a very strong case for some sort of investigation before we commit ourselves finally to the proposals contained in the Bill.

I do not know whether your Lordships have all glanced with any care through the Amendments with which we shall be called upon to deal in the Committee stage. It has been my duty to look through them, with assistance—for I venture to say, though I have the greatest respect for the high abilities of your Lordships, that I do not think there are twenty men in your Lordships' House, and I think I put it rather high, who would be able, without assistance, to follow the many Amendments upon the Paper. These Amendments deal with a very complex subject, and they deal with it in very technical language. I really think that to deal with them upon the floor of your Lordships' House will be an extraordinarily difficult matter.

I shall not, of course, discuss them at this stage because I should be out of order in doing so, but there are a large number of questions dealing with the position of power companies in reference to the joint electricity authority: there are complicated questions dealing with very elaborate rights and very elaborate safeguards; there are a number of Amendments dealing with the position of authorised undertakers, that is to say, in a large number of cases, of local authorities, and with their relation to the joint electricity authority—as to what power they shall have, as to what right to safeguards, and as to what right for equitable treatment under certain circumstances; and finally, there is the relation of the joint electricity authorities to railway companies. The Amendments dealing with these matters are very far-reaching. They touch a great number of vested interests and a great number of rights which already exist. They raise principles which have never yet, so far as I know, been accepted in our legislation.

All these questions are very formidable and I am quite sure that matters so complicated and so technical can be treated only in one of two ways. Either we must trust entirely, or almost entirely, to the wisdom of the Government Department, no longer, I am sorry to say, presided over by my noble friend, or else we must have sonic sort of investigation in the form of a Committee to look into them. Would it be right in this matter to trust entirely to the Government Department? I am sure that if this matter is going to be dealt with on the floor of your Lordships' House, that is what it will mean. I do not suggest that we ought to abdicate our duties. We must do the best we can, if we go into this matter, to consider it efficiently, but in a great measure we shall have to trust to the Government Department. I have a very high opinion of the Civil Service, and I should be willing to trust the Department for a very long distance, but this Bill for the provision of electricity really raises a vital point, because what is suggested is that electricity shall be the subject of bureaucratic control. I am not saying that that is necessarily wrong, but in these later days we have learnt to be (shall I say?) a little jealous of bureaucratic control. We are very nervous when it is suggested that a great public service should be handed over to a number of officials.

But that is not the most important question it raises. It raises the question of how far the rates are to be made available to work this system. I am not going into detail at all, but I say that in these days Parliament ought to be very careful before it throws any extra burden upon the ratepayers. I am sure that that is felt in every quarter of your Lordships' House. I am aware that the Government concede that necessity, and have gone so far as to show me an Amendment that they would be willing to accept, but when I tell your Lordships that I only saw the Amendment three-quarters of an hour ago, and that it deals with these highly technical and complicated matters, you will not expect me at this moment to say anything about it. We must deal with the subject at this stage upon purely general considerations. The first matter which has to be thought of when you are considering whether the ratepayers' credit or the ratepayers' cash should be employed, is whether the enterprise upon which it is going to be employed is perfectly sound as a business proposition. I am not going to say that it is unsound, but there seems to be a great deal of doubt as to its soundness.

VISCOUNT PEEL

Where?

THE MARQUESS OF SALISBURY

In the minds of the Government, I think. If the noble Viscount will wait a moment he will see that I am not suggesting anything very polemical in the matter. Ordinary private enterprise goes into the market and raises money in the ordinary way. Electricity supply is very popular as an investment, and any amount of money is to be had for private electric enterprise. It is very astonishing therefore that the Government, in this Bill, do not think that enterprise of this kind can be furthered unless it has the rates behind it. Why do you want the rates if it is absolutely sound? It is perfectly clear that if it is an absolutely sound proposition it will be financially wholesome in every respect without the rates, and therefore it is that I say there is a doubt about it. The whole point of my argument is that the matter requires inquiry and investigation. I shall be only too glad to find that my suggested fears are unfounded.

Then there is the question of compulsion. The Bill is mostly upon a voluntary basis, but very good judges—and one especially who is a very good judge and upon whom I rely in respect of my own county—consider that there is great danger of indirect compulsion upon local authorities to force them to use the rates for this enterprise. One wonders why it is, if the rates are to be used, that the Government have not come forward with some plan for enabling schemes under the joint authorities to be brought before Parliament by Provisional Order, or in some other abbreviated form, for the purpose of obtaining such rating assistance as may be required.

What I have said goes to show that an inquiry is required before you are committed to the system in the Bill, and all these reasons seem to me to suggest a very obvious course—namely, that the Government should agree, as I venture to suggest, to the appointment of a Select Committee, and the reference of this Bill to that Committee. Is that an obstructive proposal? I do not think that the Government will lose anything by it. They will have a much better piece of legislation after consideration by the Select Committee, even if the Amendments which the Select Committee put into the Bill should be comparatively minor Amendments, and I should put them much higher than that. They will not lose time, because even if you make every despatch the Bill cannot reach the House of Commons until after Easter, and one knows what happens to Bills of a controversial character which reach the House of Commons after Easter.

The Government, of course, can press it through, but I doubt whether they will find time to do that. May I say that I think a Bill which purports, in certain circumstances, to throw an extra burden upon the ratepayers is not likely to be very popular in the House of Commons, especially on the eve of a General Election. I cannot help thinking that the Government will find that unless the Bill goes to the House of Commons with the support of a Select Committee, and with all the weight which their Report will give, it is very unlikely to survive the legitimate opposition which will arise in another place. Therefore I suggest to the Government that in the interest of legislation, as well as in their own interest, they would be far wiser if they were to agree to the Bill being sent to a Select Committee.

VISCOUNT HALDANE

My Lords, every one who has listened to the noble Marquess on this and other occasions knows how public spirited he is, and how desirous he is of doing the right thing; but I cannot help feeling that he is bringing his judgment to bear upon this great question without sufficient knowledge of it. He speaks of the ratepayers as if it was a question of throwing burdens upon them. Let him go to any of the big municipal corporations—Glasgow, for instance—and ask what has been the result of the handing over to them of their water supply, their gas supply, and their tramways, and they will tell you that the saving to the ratepayers has been enormous, because all the waste of the old system has been avoided. He asks for a Select Committee. This Bill has been investigated; the scheme has been investigated three times. The noble Marquess shakes his head. I sat myself for two years as Chairman of the first Committee which investigated and recommended the scheme, and we had the finest expert evidence we could get.

THE MARQUESS OF SALISBURY

Not this Bill.

VISCOUNT HALDANE

The scheme which underlies this Bill—the question of saving the money of the public and not of putting the cost upon the public. Our Report went to another Committee, and to a third Committee, and each came to the same conclusion. The matter has been investigated three times, and the result has been this Bill, or rather the Bill of 1919, which has been expurgated and which we are content to take in its present form. The noble Marquess talks of it as a proposition to put a burden on the public. In fact, the Bill proposes to make a saving which ought to amount to not less than 50,000,000 tons of coal a year—the waste which arises at every turn from the overlapping of these private enterprises, with every kind of scheme, every kind of pressure, and every kind of arrangement. In the County of Durham the cost is not more than ½d. per unit, while in the next county the cost is 2d. or 3d. and even more. In London the ratepayer has to pay through the nose for electricity. He ought not to have to pay for it at anything like the rate which he now pays. The system proposed contemplates an enormous saving, and I am satisfied that, if properly carried out, it will achieve that end. So far from any burden being put on the rates there will be a great saving to the rates. The opposition is put forward on the footing that this is some new scheme which has not been considered before. It has been considered fully, and we have been waiting for it for years.

Look at it from another point of view. The American skilled workman has at his disposal 56 per cent. more power than has the British workman in the same position. How does that leave us in a fair position? At every turn we want to develop industry, and to get more employment for our people. How can you get it if you leave our people in the position in which they are under the present system of sporadic electricity supply all over the country? The proposal of the Bill is very simple. It does not propose to compel anybody; it proposes to allow the great municipalities to join in supplying the country with a large and extensive scheme of cheap electric power for enterprise and for lighting. That is, at any rate, a principle against which it would seem very ill for this House to go, and I do not believe your Lordships would go against it if you realised what it means and what is implied in it. Extravagance! The extravagance conies from the iniquitous and foolish system under which we manage our electricity supply to-day. What we want is to enable the thing to be done in an orderly and decent fashion.

The measure simply sets free the hands of the great authorities who will exist under this Bill—the municipalities and the companies—to get the current brought to a place which is convenient; to convert it at that place—as often as possible at the pit head—into power direct; to convey that power and to distribute it to where it is wanted. The cost will be reduced in many cases 200 per cent. These things are worked out by engineers. They are not the speculations of laymen. They are not matters on which you can say: "Let us have a Select Committee upon it"; they are matters of science, of knowledge of business and of industry, and they have been presented in that form. It would therefore be a great misfortune if a plan which ought to have been in operation long ago, the lack of which is putting us behind other countries in the world to-day, placing us at a great disadvantage with America, with Germany, even with France, should be delayed any longer; and I trust that the Government will use such influence as they possess to carry through the plan which underlies this measure as quickly as possible. And I hope for that in the interests of the ratepayer as much as of anybody else, and of the industry of this country taken as a whole.

LORD GAINFORD

My Lords, the question before your Lordships, it appears to me, is whether the purpose of securing electric power in bulk will be best promoted by sending this Bill to a Select Committee, or whether we should endeavour here and now to deal with the Amendments on the Paper. I have given a great deal of thought to this subject since the Second Reading. I criticised the Bill on Second Reading, although I voted for it. I am quite satisfied in my own mind that we are behind many other countries in the matter of electric power. It is essential that we should have cheap power, and cheap power secured by large electricity stations all over the country. On those points I believe we are all agreed.

When we come to consider the Amendments put down to the Bill I feel it is very difficult for your Lordships to deal ade- quately with the various points which will come before us, and I should have a very much greater desire to support the Bill if it came down to this House after having been thrashed out by a Select Committee of your Lordships' House. That, I think, is the best way in which to secure a general agreement. After all, the Government introduced the Bill with a view to trying to secure a general agreement, and put it forward as a non-controversial proposal. It is essential that large electric stations should be properly financed, but it is also essential that there should be a certain amount of fixity of tenure for the large companies which have already been established, in which the public have full confidence, and which are doing admirable work. Various interests are affected, and I am quite sure those interests will find very full expression in your Lordships' House if we now proceed with the Amendments, whereas the discussions will be curtailed if the Bill first goes before a Select Committee. Further, I am convinced that in another place the difficulties in connection with this measure will be very much increased unless the Bill goes before a Select Committee of your Lordships' House.

LORD PARMOOR

I should like very strongly to support the proposal made by the noble Marquess. I regret I do not agree with the views expressed by the noble and learned Viscount, Lord Haldane, except to this extent, that we all desire the best possible system of electric power supply. It happened to be my lot in other days to take part, before various official bodies, in proceedings affecting a very large number of electrical inquiries, particularly that in 1888 which resulted in the adoption of the system of forty-two years' tenure (a tenure which might be renewed) for the electrical distribution companies; and if they are taken over by the local authorities they are taken over on definite terms. In other words, those companies proceeded throughout a long period of years on a Parliamentary guarantee for the security of their interests. The result is that at the present time, in London at any rate, these electrical companies are for the most part doing their work in a thoroughly efficient way, under prosperous conditions. That, however, is complicated by the fact that the power companies, which originated with Lord Cross's Committee, as it was called, are in an entirely different position They have not got a concession for a period I of time, but a concession in perpetuity, and one of the difficulties of the Bill as it stands is to draw a distinction between its effect on the power companies and its effect on what are called authorised companies, which are, in substance, the companies which have only a limited tenure. I agree that if with our modern experience our electric system could begin anew, we could base it upon better principles and on a far more economical plan, but you have to consider that a sum of at least £50,000,000 or more has already been expended.

I should like to quote one passage from the statement by the association of the power companies with regard to this Bill in confirmation of what has been said by the noble Marquess, who is, I think, well justified in the cautious attitude he has taken. I am sure ho has no desire to prevent this Bill passing as a whole, but he wants to put it on the best possible basis. This is the skilled view of the members of the power companies, who have invested a capital of £50,000,000 in the enterprise:— The members of this association are of opinion that if the new Bill is proceeded with a great and further needless expenditure of public money result, at a time when the burdens of national and local taxation are already becoming intolerable, and there is a universal demand for retrenchment. They submit that if Parliament decide that the joint electricity authorities shall be financed out of public funds the operations of such authorities should without exception be excluded from the areas of the power companies. The real difficulty of the position is this. The 1919 Act was altered very much in your Lordships' House on the suggestion, I think, of the late Lord Moulton, and it has eventuated in nothing being done.

The difficulty in forming these joint electricity authorities is that there are so many companies and local authorities already in possession. Some at least of those authorities have entirely repudiated any suggestion of erecting a joint electricity authority within the areas they are now supplying either as power companies or distribution companies, and there will be immense complication in forming electrical areas if at the same time the powers of the existing authorised companies or local authorities are to be preserved. The noble Viscount, Lord Haldane, instanced Glasgow. Nobody in the world would more strongly object to competition with their electrical enterprise than the Glasgow Corporation. The Birmingham Corporation have already said that they object to any competition of that kind. They also have large powers and have invested a large amount of money in electrical purposes.

I do not desire to take up your Lordships' time further than to say that I am certain, from experience, that this is a complicated matter. It is just one of those matters which can be fairly dealt with before a Select Committee and is difficult to deal with in sufficient detail before your Lordships' House.

THE EARL OF BESSBOROUGH

My Lords, having heard the proposal of the noble Marquess that this Bill should be sent to a Select Committee, and having heard the arguments of the noble Marquess and of other noble Lords in support of that proposal, I beg to make a formal Motion that this Bill be sent to a Select Committee.

THE LORD SPEAKER

My Lords, I would point out that the Motion before the House is that the House do now resolve itself into a Committee of the Whole House, and I suggest that this Motion ought first to be disposed of.

THE MARQUESS OF SALISBURY

We should, of course, be guided in this matter by the noble Earl on the Woolsack, but I thought the proper procedure was to move an Amendment to the Motion that the House should resolve itself into Committee, to leave out all words after "House" in order to insert "should refer the Bill to a Select Committee."

THE LORD SPEAKER

I am entirely in your Lordships' hands; that course could be followed. I do not know whether it would be more convenient if Notice had been given.

THE MARQUESS OF SALISBURY

I gave private notice to the Government.

THE LORD SPEAKER

Yes, but not to the House. I make no complaint, of course; but the course which at first sight appears to be the more convenient is to dispose of the original Motion, either by passing or negativing it.

LORD PARMOOR

It would be sufficient to negative it.

THE EARL OF BESSBOROUGH

I am in your Lordships' hands in the matter, but may I offer one or two arguments in support of the proposal of the noble Marquess. I do not think I shall be urging anything controversial when I say that the measure which is now on the threshold of the Committee stage is a highly controversial one, and I hope I shall have the agreement of the noble Viscount in charge of the Bill when I say it is a complicated one. Your Lordships will have noticed that, in moving the Second Reading, the noble Viscount said: I am afraid that the Bill is in many respects rather difficult to understand and"— he continued: —"I propose, if your Lordships so wish, to go rather more into the details of the specific clauses than is usual in moving the Second Reading of a Bill. He, therefore, admits the complicated nature of the Bill and takes what he describes as an unusual course in actually dealing clause by clause with the effect of the Bill. In addition to the Bill being a complicated one, there are sixteen pages of Amendments upon the Order Paper, and, as your Lordships will have seen, many of them raise very complicated points—points which, if the Government are prepared to meet the movers, will lead to very delicate adjustments if the intention which underlies them is to be carried into effect.

Broadly speaking, I take it from the speeches of noble Lords that one very strong desire of your Lordships is to protect the ratepayers. That is, no doubt, a very important consideration at all times; but it is of special importance at this time of day, and should your Lordships decide to refer this Bill to a Select Committee, I submit that you will be acting in accordance with precedent and will find very great concurrence in this matter in another place. So much concern has been shown there regarding Bills involving unlimited charges upon the rates that in 1920 a Select Committee was set up on the procedure governing Bills which involved charges. That Committee was instructed to consider the procedure governing those Bills, whether private or public, which involved charges either actual or potential upon the rates and to report what improvements might be made.

I do not apologise for bringing the Report of this Select Committee to the attention of the House, because I think it will be readily agreed that it is a very important document bearing upon this matter. Stated briefly, the Committee reported that every Bill which falls under any of the four headings which they named—one of which is Public Bills promoted by the Government giving local authorities permissive power in regard to the rates—should have attached to it a statement showing the probable cost to the ratepayers. The Committee came to this very important decision in 1920, which, I submit, is even more true in 1922— Your Committee feel that at the present time and in the existing condition of national finance more weight must be given to the protection of the ratepayers, even if the output of legislation is thereby checked and reduced. Few schemes in which the finance has been critically studied by Parliament would be of more value than a number of measures put forth with hastily formed ideas of the ultimate cost. It is a chance that this Bill was introduced in your Lordships' House and not in another place. The quotation which I have made from the Report of a Commons Select Committee leads one to feel certain that had this Bill been introduced in that House it would have received most careful scrutiny. I submit that it is well worthy of such scrutiny from your Lordships. In view of the complication of the measure and the enormous number of Amendments on the Paper, I urge that the wisest course would be to refer the Bill to a Select Committee for careful consideration. I beg to move accordingly.

THE LORD SPEAKER

My Lords, certain conversations have taken place, and I understand that it is agreed that the more convenient course would be to take the Motion of the noble Earl as an Amendment to the original Motion that we go into Committee. I will, therefore, put it in that form. The original Question was "That the House should now resolve itself into Committee on the said Bill" to which an Amendment has been moved to leave out all the words after "That" with a view to inserting the words "it is expedient that this Bill be referred to a Select Committee."

Amendment moved— Leave out all words after "That" and insert "it is expedient that this Bill be referred to a Select Committee."—(The Earl of Bessborough.)

THE SECRETARY OF STATE FOR INDIA (VISCOUNT PEEL)

My Lords, some of your Lordships, led by the noble Marquess opposete, have supported a proposal that this Bill be referred to a Select Committee. May I assume, as I think I am entitled to assume—and indeed so the noble Marquess said—that your Lordships do not desire to impede the passage of this Bill through your Lordships' House. I think I may assume that, because three or four weeks ago, by a considerable majority, in a large House, your Lordships passed the Second Reading of the Bill. It seems clear, therefore, that your Lordships have no intention whatever of going back on that decision, pronounced after a long debate. If we are to consider the practical effect of sending this Bill to a Select Committee, I shall do so in the light of that decision come to by your Lordships. I will say a word in a moment as to the exact effect upon the Bill that such a reference will have, and as to the delays that would thereby be caused.

But first of all I must take exception to the opening observation of the noble Marquess. He said, in effect: "Here you have been working under the Act of 1919 for two years, and up to this time you have not got a single joint electricity authority in operation." Of course, we have not, because it is this Bill that will enable that authority to be financed and set up. Yet the noble Marquess turns round on the Commissioners and says: "Look at your delay in doing this." In answer to that may I say that the Commissioners have advanced, as I explained on Second Reading, to the point at which the schemes are ready, and the passage of this Bill is all that is necessary in order that the schemes may come into full operation. That is a matter in regard to which I hope the noble Marquess will assist us.

I think noble Lords have been unduly depressed by the difficulties of this Bill. The noble Marquess seems to think that it is rather beyond the capacity of your Lordships to deal with the Bill on the floor of the House. I beg to differ entirely from that view. I have seen your Lordships discuss with great success, and great skill, matters far more complicated than this, and I really do not despair, as the noble Marquess does, of your Lordships being able to deal with this Bill just as well as you have dealt with other matters of a far more complicated character. The parent Bill is the Act of 1919, and this is really only a consequential measure, merely filling up certain hollows in that measure to enable it to be operative. The Act of 1919 was discussed on the floor of your Lordships' House, and it was an infinitely more difficult and complicated Bill than is this one. Is it not, therefore, absurd to say that, having dealt with the parent Bill on the floor of this House, you cannot also deal with this much smaller amending measure on the floor of the House? The argument is, if I may say so with respect, rather an absurd one.

Some of your Lordships have spoken of the sixty different Amendments. It is true there are sixty Amendments, but there are only about four Amendments, in all, that will require discussion, because the great bulk of the Amendments are consequential.

THE MARQUESS OF SALISBURY

The noble Viscount is wholly in error.

VISCOUNT PEEL

If the noble Marquess will pardon me, I am not the least in error. I know the Bill, and I know the Amendments, and I can assure your Lordships that when we get into Committee and you have given a decision upon two or three of these points the whole of the rest will be swept away. I do not quite understand how this suggestion came about. The noble Marquess is now extraordinarily anxious to refer this matter to a Select Committee. During the last two or three days conversations have been going on between the supporters of the Bill and the noble Marquess and, I think, also the noble Earl, and they led to a certain provisional arrangement—subject of course to the approval of your Lordships being arrived at—by which the Government propose to make certain concessions in regard to some of these Amendments. I really do not see the use of these conversations if they are to be entirely thrown away, and if, when we come to this House, the matter is to be referred to a Select Committee.

May I say, with great respect to your Lordships, that the points I have heard discussed this afternoon were fully debated on the Second Reading, and it was with full cognisance of those matters that you went to the Division. I pointed out—and it was pointed out also by many speakers—that so far from this Bill causing a great increase in rates, the whole tendency and force of the Bill was precisely in the opposite direction, and that instead of having these numberless small, expensive, costly, wasteful stations all over the country, with different frequencies, not interchangeable, and different pressures, you would have large stations by means of which you could produce more cheaply, and that there would be not an increase but a saving to the rates. That, in fact, is the whole object of the Bill, and if that is not its result I agree that the whole Bill is a failure.

THE MARQUESS OF SALISBURY

Why not have it inquired into by a Select Committee?

VISCOUNT PEEL

Because your Lordships are quite capable of dealing with it on the floor of the House. These matters have been inquired into over and over again, and sometimes it is time for action and not for constant deliberation and talk. The noble Marquess would deliberate, and talk, and postpone, and go to a Select Committee, and nothing would ever be done.

VISCOUNT HALDANE

The evidence that would have to be taken would be very great.

VISCOUNT PEEL

I shall deal with that aspect in a moment. May I say that the whole object of this Bill—not a word has been said about this, although we have heard a great deal about the interests of power companies—is not one of power companies or local authorities, but it is to produce cheaper electricity which will set the factories of this country going, and do something to relieve the burden of unemployment. For that reason I am anxious to get this Bill into operation as soon as possible. There is no time for delay in this matter. The noble Marquess says that this year or next year is almost the same thing, but I would point out to him that it makes a great difference if we can start at once, and relieve to some extent the burden caused by having two millions of unemployed. The matter of safeguards and bureaucratic control has all been dealt with. Again, an old and much discussed point was brought up by one speaker who said that you are taking away powers from Parliament. I pointed out again and again during the previous debate, that all these claims have to come before both Houses of Parliament. They have to lie on the Table and be passed not merely sub silentio but by actual Resolutions assenting to them by both your Lordships' House and another place, so that you will have complete control.

What will happen if the matter is referred to a Select Committee? First of all, I may say that it was in order that your Lordships should have full time to study the matter—and I have no doubt your Lordships have taken full opportunity of that period of time—that I twice postponed the Committee stage of this Bill. It is now nearly four weeks since the Second Reading, and during the interval your Lordships have, no doubt, been engaged in a full and searching investigation, as I know many of you have, of the details of the Bill. It has already been submitted to a general Joint Select Committee of all the members of this House. We are adjourning, I understand, for the holidays in about a week, and I am informed that it would not be possible or practicable to set up this Select Committee before the holidays.

We meet again on May 2, and then, I suppose, some time after that, the Select Committee would be set up. Before this Select Committee the parties would be able to appear by counsel, and you must, therefore, give at least ten days' or a fortnight's notice of the meeting of the Committee so that interested parties may have an opportunity of preparing their case. That lands us into the middle of May. How long the Committee may sit I do not know; but if the matter is so extraordinarily complicated Counsel will have glorious opportunities for prolonging the discussion. Then it comes back to this House, where you have further discussion in Committee and on Report; and, finally, at some remote period in the summer it will go to another place.

What chance is the Bill likely to have in those circumstances? Will you not enormously prejudice its fortunes by so great a delay? It will be exposed to every wind and storm of Parliamentary chance. If you are going to give this Bill a chance I urge that it should be dealt with now, so that it may go to another place before the holidays. I believe that all the immense difficulties, exaggerated by eloquent members opposite, will disappear if you will only get down to business and address yourselves to the Amendments on the Paper. I can assure you that I will deal with them as rapidly as possible, and I do not think you need fear that they will not have full investigation on the floor of this House. I strongly urge your Lordships not to support the Amendment. It will have serious consequences, and will, I am afraid, have the result of destroying the Bill this session.

VISCOUNT NOVAR

My Lords, we have been told that the Bill of 1919 was extremely complex, and, undoubtedly, that must have been the case because throughout the country neither companies nor local authorities could tell where they stood. The complexity and delay introduced by that Act was such that nearly every project I happened to have heard of has been held up by the Electricity Commissioners for the last two years. There are two reasons why I support I he Amendment of the noble Lord. The first is this. It is not merely a question of local authorities or

Resolved in the affirmative, and original Motion agreed to accordingly.

House in Committee accordingly.

[The EARL OF DONOUGHMORE in the Chair.]

Clause 1:

Power of authorities to borrow.

1.—(1) For the purposes hereinafter mentioned a joint electricity authority may, with the consent

companies being able to proceed with their undertakings, but of their control by a central authority. If the local authority and the company had been given a free hand we should have been far more advanced in the provision of electric power than we are to-day. The other reason is that the ratepayer may be called upon to contribute. I think the ratepayer has been asked to contribute enough already, and when a central authority has the right to put pressure on local authorities to obtain a contribution from the rates it is extremely likely that the local authorities will have to find that contribution. On those two grounds alone I support the Amendment.

On Question, whether the words proposed to be left out shall stand part of the Motion?—

Their Lordships divided:—Contents, 42; Not-Contents, 40.

CONTENTS.
Sutherland, D. Hood, V. Marshall of Chipstead, L.
Knutsford, V. Monk Bretton, L.
Lansdowne, M. Peel, V. Muir Mackenzie, L.
Bradford, E. Ullswater, V. Riddell, L.
Buxton, E. Ritchie of Dundee, L.
Clarendon, E. Annesley, L. (V. Valentia.) St. John of Bletso, L.
Lucan, E. Clwyd, L. Saltoun, L.
Onslow, E. Colebrooke, L. Shandon, L.
Stamford, E. Colwyn, L. Somerleyton, L. [Teller.]
Strafford, E. Cottesloe, L. Stanmore, L. [Teller.]
Dewar, L. Stuart of Wortley, L.
Chelmsford, V. Gorell, L. Sudeley, L.
Churchill, V. Hemphill, L. Terrington, L,
Falmouth, V. Hylton, L. Wigan, L. (E. Crawford.)
Haldane, V. Killanin, L. Wyfold, L.
NOT-CONTENTS.
Bedford, D. Ampthill, L. Monkswell, L.
Salisbury, M. Askwith, L. Newton, L.
Atkinson, L. Oranmore and Browne, L.
Dartmouth, E. Bearsted, L. Ormonde, L. (M. Ormonde.)
Grey, E. Bellew, L. Parmoor, L.
Lichfield, E. Buckmaster, L. Ponsonby, L. (E. Bessborough.) [Teller.]
Lovelace, E. Cullen of Ashbourne, L.
Malmesbury, E. Denman, L. Redesdale, L.
Midleton, E. Desborough, L. Shuttleworth, L.
Morton, E. Desart, L. (E. Desart.) Southwark, L.
Selborne, E. Erskine, L. [Teller.] Strathspey, L.
Stanhope, E. Gainford, L. Sumner, L.
De Vesci, V. Lambourne, L. Vernon, L.
Novar, V. MacDonnell, L. Wavertree, L.

of the Electricity Commissioners, and subject to regulations to be made by the Minister of Transport with the approval of the Treasury, borrow money, in such manner and subject to such provisions as to the repayment thereof, and with such powers as to reborrowing for the purpose of paying off a loan previously raised, as may be prescribed by the regulations, and such regulations may empower a joint electricity authority to borrow temporarily, to issue bonds and to make arrangements with bankers, and may apply with or without modifications any enactments relating to borrowing by local authorities, including provisions as to the enforcement of the security by the appointment of a receiver and manager or otherwise.

(2) Such powers of borrowing as aforesaid may be exercised for all or any of the following purposes:—

  1. (a) for the purpose of the payment of the purchase price of any generating station or main transmission line transferred to, acquired by, or vested in a joint electricity authority under the Electricity (Supply) Act, 1919 (hereinafter referred to as "the principal Act"), or of any undertaking or part of an undertaking acquired by the authority under the principal Act;
  2. (b) for the purpose of any other payment or of any permanent work or other thing which the authority are authorised to execute or do, the cost of which ought, in the opinion of the Electricity Commissioners, to be spread over a term of years (including the payment of interest on money borrowed for capital expenditure whilst the expenditure remains unremunerative, and the payment of any sum payable under subsection (3) of section eighteen of the principal Act);
  3. (c) for the purpose of providing working capital.

(3) Any money borrowed under this section, and the interest thereon, may be charged on the undertaking and revenues of the joint electricity authority, or on any specific property forming part of that undertaking, and shall be repaid within such period as the Electricity Commissioners may determine.

VISCOUNT FALMOUTH moved, in subsection (2), at the end of paragraph (a), to insert "other than a generating station, main transmission line, undertaking or part of an undertaking situate within the area of supply of a power company." The noble Viscount said: This Amendment has been the subject of much discussion. I have also put down another Amendment, to insert a new clause after Clause 12. Before proceeding with the Amendment which I now move, I should like to ask the noble Viscount in charge of the Bill what he intends to do with the second Amendment.

Amendment moved— Page 2, line 2, at end insert the said words.—(Viscount Falmouth.)

VISCOUNT PEEL

The noble Viscount asks what is the attitude of the Government towards his proposal. He knows that there has been some discussion upon the subject of this Amendment. For reasons which I will state if necessary, or if he presses me to do so, we cannot accept his first proposal, but we are prepared to accept the Amendment he proposes later, subject to a consideration which is necessary having regard to Section 12 of the Act of 1919. If the noble Viscount is content with that proposal he might be good enough to withdraw his first Amendment and at the proper time to move the second Amendment as I have suggested.

VISCOUNT FALMOUTH

I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 1 agreed to.

Clauses 2 and 3 agreed to.

Clause 4 (Power to discharge purchase price by issue of stock, etc.):

VISCOUNT FALMOUTH had an Amendment on the Paper after "principal Act," where that phrase secondly occurs, to insert "other than an undertaking or part, of an undertaking or generating station or main transmission line situate within the area of supply of a power company." The noble Viscount said: This Amendment is consequential, and I do not move it.

Clause 4 agreed to.

VISCOUNT FALMOUTH had an Amendment on the Paper to insert the following new clause, after Clause 4: . Nothing in the principal Act or this Act shall authorise a joint electricity authority to borrow money, or to create or issue stock or other securities, or to incur any expenditure for the purpose of, or in connection with, the acquisition or construction by or the transfer to the joint electricity authority of any generating station, main transmission line, or other work or any undertaking or part of an undertaking within the area of supply of a power company. The noble Viscount said: This also is consequential, and I do not move.

Clause 5:

Power of undertakers, etc., to give financial assistance.

5.—(1) Any authorised undertakers whose area of supply is wholly or partly within the district of any joint electricity authority, and any local authority, company, or person receiving or intending to receive a supply of electricity from the joint electricity authority, and the council of any county or borough or county district wholly or partly within the district of the joint electricity authority, shall have power—

  1. (a) to lend any money to the joint electricity authority which the authority is authorised to borrow; or
    2. 1085
  2. (b) to subscribe for any securities issued by the joint electricity authority for the purpose of raising such money; or
  3. (c) to guarantee or join in guaranteeing the payment of interest on any money borrowed by the joint electricity authority or on any securities issued by that authority; or
  4. (d) to give financial assistance in any other form to the joint electricity authority;
on such terms (including the payment of consideration for the assistance given) and subject to such conditions, as the authority, company, or person giving such financial assistance may think fit;

Provided that in the case of the council of a county or borough or county district, whether or not the council are authorized undertakers, or receive or intend to receive a supply of electricity from the joint electricity authority, such powers as aforesaid shall not be exercised (except in the case of the London County Council) without the consent of the Minister of Health.

(2) The raising of money for the purpose of so lending or subscribing for securities shall be a purpose for which a council may borrow—

  1. (a) in the case of a council of a county under the Local Government Act, 1888;
  2. (b) in the case of the council of a metropolitan borough under the Metropolis Management Acts, 1855 to 1893; and
  3. (c) in the case of the council of a municipal borough or county district under the Public Health Act, 1875;
and any money payable by such council under any such guarantee, or in giving such other financial assistance as aforesaid, shall be treated as expenses in the carrying of the said Acts into execution respectively.

Section twenty-one of the Electric Lighting Act, 1909, shall apply to money borrowed by a council under this section as it applies to money borrowed by a local authority under the Electric Lighting Acts, and accordingly money so borrowed under this section shall not be reckoned as part of the total debt of the council for the purpose of any limitation on borrowing under the enactments relating to borrowing by the council.

(3) Any company, association, or body of persons may exercise any such power as aforesaid, notwithstanding anything contained in any Act, order, or instrument by or under which it is constituted or regulated, and may apply any of their funds for the purpose of lending any such money, subscribing for any such securities, fulfilling any such guarantee, or giving such other financial assistance, and may borrow for the purpose of making any such loans or subscriptions.

(4) A scheme constituting a joint electricity authority may include provisions authorising or requiring authorised undertakers, and authorising companies and other bodies represented on the authority to contribute towards any administrative expenses of the authority, and any such scheme may also include provisions requiring such authorised undertakers to meet any temporary deficiencies in the fund established under subsection (1) of section twenty-eight of the principal Act.

(5) Any authorised undertakers may exercise such powers as aforesaid, notwithstanding anything in section three of the schedule to the Electric Lighting (Clauses) Act, 1899, as incorporated in any order or special Act applying to them or any similar provisions contained in any such order or special Act.

LORD ASKWITH moved, at the beginning of the clause, after "Any authorised undertakers" to insert "not being a local authority." The noble Lord said: This is the first of a series of Amendments which I shall move with the object of preventing local authorities from entering into the various monetary transactions laid down by this important clause. If your Lordships will examine Clause 5 you will see that it has a cumulative effect. In the first line it permits authorised undertakers—whether local authorities or not—"whose area of supply is wholly or partially within the district" to lend, subscribe, or guarantee money in a manner later on provided. It goes on to say that "any local authority, company or person receiving, or intending to receive a supply of electricity from the joint electricity authority, and the council of any county or borough or country district wholly or partly within the district of the joint electricity authority," shall have power to lend, subscribe, or guarantee. This sets out nearly every kind of party, person, or authority from which the joint electricity authority hopes to get money. My proposal is that the local authorities should be left out of the list of persons from whom the money should be obtained under the vague permission given in this Bill. It would not prevent their coming before Parliament in the ordinary course for permission to do so.

The permission given to them is to lend any money, to subscribe for any securities, to guarantee, or join in guaranteeing the payment of interest for any money borrowed by the joint electricity authority, and to give financial assistance in any other form to the joint electricity authority. I can imagine no schemes of a monetary kind that a local authority could handle in a wider way than that. A power is given to local authorities which is almost without precedent. Further, there is no check, except as regards a particular class of these local authorities. The council of a county or borough or county district has to obtain the consent of the Ministry of Health. In this clause, particularly paragraphs (c) and (d), there is no limit to the amount, there is no limit to the period of time, there is nothing said about any margin of security, or about prior charges which may alter the security that is given. If you look at line 37, you will see it stated that the money borrowed shall not be reckoned as part of the total debt of the Council for the purpose of any limitation on borrowing under the enactments relating to borrowing by the Council. This would be an initial charge upon the local authorities, but that it would be the end of the business, however wide these rights are, is not likely to be the case.

Possibly, there is no industry in this country that requires such an incessant flow of new capital as the electrical industry, or one in which such a scrapping of old machinery, bringing in of new machinery and such speedy and quick development are going on at the present time, together with great technical advance, which has enabled this country to supply other countries with a great deal of the machinery they want for their electrical appliances, turbines, cables, protective gear, and consuming devices. Up to the present, however, the progress in this country has not been great, largely due to the dead hand that Parliament has put over the electrical industry.

But if this progress goes on and new capital is required, you are now giving a practically blank cheque to these joint electricity authorities, and permission to issue that blank cheque to the local authorities without any scheme being before this House—no real engineering, administrative or financial scheme. The approval of this House, which has always been the customary method of carrying on these industries, is not to be given, but the matter is to be handed over to the control of authorities of a very hybrid character, with no particular unified control, very unwieldy in their character and consisting of members of a transitory kind. You are further handing the control of the electricity industry in this country over to these bodies with absolutely no engagement that you are going to give cheaper electricity. Nothing is said in this Bill about the limit of price to be charged, and in the numerous books on electricity estimates have been given which have varied in the most astonishing character from time to time.

Two years ago every one in the engineering world was said to be in favour of the scrapping of existing stations and the establishment of large capital stations. A most representative, independent and expert body of engineers was set up in London to examine this proposition. They examined two schemes of the kind I have indicated, and also a scheme for extending existing stations, with possibly one or two large stations supplying bulk. The result of their Report was an eye-opener to the individuals and the authorities who have supported these large bulk stations. The engineers reported that the large stations initially would require £13,000,000, and that when developments had taken place they would come to an expenditure of £30,750,000, and that the result of all that expenditure would be to give dearer electricity. This threw the authorities, meeting together, upon the adoption of some variation of the scheme, that there should be joining up, with one or two power stations. The expenditure was to be considerably less, namely about £9,750,000 new capital, and an annual charge of £7,262,700. With that they hoped to reduce the price of electricity, where it was not cheaper, to 1.147d. per unit.

But this was not enough to make a substantial difference, with the consequence that the Electricity Commissioners came out themselves with a decision. Their decision, in which they did not advance any real figures, and which appears to be very much guesswork, is that they should not have so many big power stations, that they should spend £6,190,000 by which they hoped to reduce the price per unit to .97d. That procedure had to be adopted because even with the minor scheme in London it was apparent that the price of electricity in London would be greater than in some existing districts, such as Walthamstow, where it was produced at a price of 1.32d. It may be that the public would be taken in by this possibility of cheaper electricity, which has been so much set about, but there is no proof that they will get cheaper electricity, and you cannot have proof until all the existing stations, which you are going gradually to scrap, are scrapped, and then you will find that you have to ask for money to be advanced to a joint electricity authority with no assets except the undertaking, and the control I have outlined.

The noble Viscount, Lord Haldane, has talked about America, and the amount of electricity there. America has not been developed by joint electricity authorities or by obtaining money out of the rates. If the schemes are so good let private indi- viduals and financiers subscribe to them, or let the big power companies subscribe to them. If they do not consider the proposal good enough, why put it upon the rates, where you would saddle posterity without any possibility of escape? You are doing it at a time when the ratepayer is overburdened with the excess of rates. You are doing it at a time when the advantage cannot get very easily to the present ratepayer, and when it may possibly be of some advantage to the future ratepayer. Therefore, you are either pledging the future, or making a bargain at the expense of the present. I very much doubt whether the money could be got outside the rates, but at least during the last twelve months sixteen electricity companies, acting with control by themselves, and not under a joint electricity authority—because the subscribers have chosen their own leaders and know who the men are who control the industry—have been able, by public issue, to obtain £5,500,000. By private issue they have been able, so it is said, to obtain a great deal more.

It may be said that the municipal authorities would be hampered if they were omitted from this Bill, that they have as large an interest as or a larger interest than the power companies in the electricity business, particularly in the north of England. If they desire to subscribe let them subscribe in the method that has been customary. But you are now handing over the control of this huge industry to these hybrid bodies. It is a pure leap in the dark as to whether it will be a success or not. You are rushing into it with great speed, and if there are disadvantages the cost should not be put upon the rates. The ratepayers of the big districts can join together for municipal or political reasons, practically by a kind of moral coercion, to impress upon the smaller districts the necessity of subscription. You will have jealousies, one district objecting to distant enterprises being financed by itself, or possibly competing places.

By the investment of the money of the good municipalities you impair their credit and affect their borrowing power for other plans which might be much nearer their hearts. If you join good and bad places together, the liability being joint and several, it is the good who are really liable and therefore you are putting pressure upon municipalities by establishing a joint electricity authority with which there will be no competition. You are making them subscribe their money to a business over which they have no direct control, and, once the boats are burnt, it will be impossible to go back again. On posterity would be the burden of the mistake you made. My submission is that more care should be taken with regard to any liability to subscribe from the rates. The rates should not be burdened further at the present time, either by the amount they might have to pay in interest, if the authorities failed, or by a liability in the future. If the schemes put forward by the Commissioners are really good the money should be obtained from private enterprise, and from persons and companies who have already gone into the business for the purpose of carrying it out.

Amendment moved— Page 3, line 31, after ("undertakers") insert ("not being a local authority").—(Lord Askwith.)

LORD MONK BRETTON

I very much hope that the Government will oppose this Amendment. Its object is to prevent local authorities from making further commitments in electricity, or, if they are allowed to do so, they must do it by the very expensive procedure of going before Parliament and engaging Counsel. It is, I think, a very good Amendment for a lawyer, but not for the local authorities. It is not only in the North of England that the local authorities are largely concerned with electricity. They are, I think, the largest undertakers in London. And these undertakers have power at the present time to incur capital expenditure. Much of this expenditure is not economical. That is not their fault so much as the fault of the limited and uneconomical area for which they have to cater. And these joint electricity authorities are intended to render the areas more economical. If the noble Lord succeeds in passing this Amendment and the joint electricity authority is prevented from getting financial help from the local authorities, it will not be able to raise the capital necessary for a large and economical production of electricity in such a place as London. It will not be able to supply in bulk at rates which are reasonable. And, that being so, the Bill is wrecked; it breaks down.

The objections made to the local authorities always concern this question of tile rates. Is this joint electricity authority for London—I confine my remarks to London because I know about London—going to be a very extravagant body? It will consist of twenty-six people. Eight will represent the borough undertakers; eight will represent the companies (the companies have rather better representation proportionately than the authorities); six will represent the London County Council; three, the home counties and the railways; and there will also be an independent chairman. That makes twenty-six, and only eight of them represent local authorities which are undertakers. The London County Council comes in from a totally different angle. Its point of view is bound to be that of the consumer; its very constituents will make it so. Therefore, this joint electricity authority is likely to be an extremely conservative body. I venture to compare it with a body which your Lordships may know, the Port of London Authority, which is nothing if not a very conservative administrator. It was presided over for a long time by a prominent member of your Lordships' House whose work is well known to your Lordships.

The prices of these local authorities in London to-day compare favourably with those of the companies. Their finances may be investigated—and have to be investigated. For the most part they place large sums to the reserve and they uniformly treat electricity as a trading service. You cannot treat electricity as the Poplar Guardians treat the service of the unemployed or the poor, and it certainly cannot be done through an electricity authority. Let me tell your Lordships what happened when this Bill was before the London County Council. The London County Council has just been re-elected, and there is upon it a bigger majority of Municipal Reformers than there has ever been before. We were not elected on the ticket of municipal trading; quite the contrary. Since this Bill was read a second time in your Lordships' House it has been considered by a very full meeting of the Council which had before it the report of a committee that had investigated the matter. One member of the Council said that he wanted the Bill opposed and referred back, but be could not get a seconder, and that was the end of that. Seeing that the County Council has acted in this way, if the noble Lord is right they must be either knaves or fools, and they would be fools to be knaves. I submit that they have pretty good advisers and, after having gone into the matter for years, that is their practically unanimous opinion.

If the London County Council is to transfer to a joint electricity authority the statutory powers of purchase that it has over all the electricity undertakings of London at the present time, it is absolutely essential that any such Amendment as this should be put on one side. The Bill has been agreed to by all parties on the London County Council. It has been agreed to by the Progressives as well as by the Labour Party. We want it because we believe that there is much more prospect of stability in electricity legislation, so far as London is concerned, if the Bill goes through than if it be thrown out and the question becomes the sport of Party politics.

The question of the expense to the rates is one which is continually referred to. The Earl of Bessborough has an Amendment to limit the rate to one penny for the purposes of the Bill. I shall be perfectly prepared to agree to that Amendment, and I have the authority of the London County Council to do so on their behalf, but also to deprecate it because it will lead people to suppose that we are going to spend the penny. It sounds too much like Dr. Addison's housing scheme, and for that reason we do not like it. We have not the slightest idea of a penny on the rates in connection with this Bill, and that is our attitude towards it.

VISCOUNT HALDANE

The noble Lord who has just sat down has made what is, to me, a very interesting speech, and I hope your Lordships followed it. He spoke on behalf of the London County Council. What sort of body is the London County Council? Is it a very radical or revolutionary body to-day? It has just gone through the process of election, and it is a body which has been sent there by a vast preponderance of moderate opinion. The London County Council, which speaks to-day through the noble Lord, declares that this Bill is of great importance to it, and asks that the Government should press it through. That brings me to the Amendment which the noble Lord, Lord Askwith, has moved to Clause 5. It is a very simple one. It seeks to cut out altogether bodies like the London County Council, and all other municipal authorities through the country, from having any lot or part in the working of the scheme. They are not to be able to contribute to or assist a joint electricity authority.

Whit is the joint electricity authority? It is a body set up by Section 6 of the Act of 1919. It is a body which will be composed of the undertakers, actual and prospective, with representatives of the local authorities, the companies, and other people concerned. In many cases that electricity authority will have a large area, and it is very important that it should because the larger the supply of electricity which you furnish the cheaper you can produce it. The noble Lord, Lord Askwith, proposes to cut out the whole of these municipal authorities. London, Glasgow, Edinburgh, Manchester, Liverpool, Sheffield, and Newcastle are all to go out of this Bill. It is not a Bill for forcing them to come in; it is a Bill for permitting them to come in if they please. Yet the noble Lord says they are not to do so. On what grounds? I listened very attentively to the reasons lie put forward. He made a speech which was a Second Reading speech all over again, based on opposition to the whole plan, which he said was a bad one. He said it was based on the reasoning of engineers which was met by the reasoning of other bodies of engineers to which he referred; altogether, it was something in the air, as to which we had no surety.

The noble Lord is quite wrong. We have the facts and the actual figures of such a scheme, and if he will come with me to the Library I will show him a return which gives the amount charged in a region where the substance of this plan has been in operation through the enterprise of a number of bodies, public and private, and that charged in areas where it is not in operation. In Northumberland and Durham., where the North Eastern Power Company has managed to bring all sorts of people together and is working with municipalities and the railway companies, electricity is charged for at a fraction of the rate over the border where we are left to the sweet mercies of the private enterprise of a vast majority of companies who are, no doubt, serving a public purpose, but are selling electricity under a monopoly at prices inordinately higher than those which are charged where there is a reasonable system in operation.

This is not a Bill for inflicting hardship on private companies further than this—that it will, no doubt, be proposed to purchase their undertakings, and their undertakings are undertakings which command a very considerable supply of electricity. That electricity will be supplied at a much lower rate to the public because the production will be at a lower rate and it should be possible to supply it, if necessary, at a profit for the benefit of the rates, as is done in other cases on that footing. But when we come to the Amendment of the noble Lord, we find that it is based on the argument that it is a bad scheme. That is why he wants the local authorities to be excluded from it. The argument that it is a bad scheme he bases upon grounds which were relevant to the Second Reading of the Bill but come very late when we are dealing with Amendments directed to specific points. I am not going to discuss it. I will only emphasise to your Lords1ips the fact that we have had experience of the actual working of this plan in the north of England. We have the plan in existence in Northumberland and Durham. We can contrast the prices at which electricity is produced under that plan with those which are paid over the border where there is no power to set up these bodies to supply electricity, and it is done by large private companies and authorities.

The noble Lord who has just sat down has put the case for the London County Council. I think he has put a most emphatic and important case, and one which is very much to the point here. Years ago, when I was a member of the other House, I remember doing all I could in support of the Conservative Government of the day—I was in active opposition—to get a Bill through which would have enabled a large scheme such as that which had been set up by voluntary enterprise in the northern counties of England to be put on foot. The plans were ready, and the Government brought in the Bill, but it was opposed by the private companies. The private companies, and I think sonic shortsighted people too, succeeded in wrecking the Bill, because they did not like any undertaking, however large and however well arranged, to be run without its being run under the auspices of the London County Conner alone. There might have been something to be said for that principle if the London County Council had been in a position to undertake it, or wished to undertake it.

To-day, they say they want a larger authority in order that they may have a larger supply of power at much cheaper rates, and under conditions in which electricity can be got most cheaply. To stand in their way, to stand in the way of Glasgow, Edinburgh, Manchester, Liverpool, Newcastle and Sheffield—the great bodies which are asking for this Bill—is to put this House in a position of considerable peril, and if it were on grounds of attachment to this House alone I should not be prepared to give any support to the Amendment.

LORD PARMOOR

I think this discussion shows the difficulty of dealing with a complex matter of this kind on the floor of the House, because contradictory statements have been made, or may be made, and it is very difficult to draw any line between them. For instance, the noble Viscount has referred to Mertz's scheme. In the case of Mertz, who lately died, he was originating a scheme that was an illustration of private enterprise and voluntary work. It was the very class of voluntary work and private enterprise that ought to be encouraged to the utmost, and, so far from it being in favour of the scheme of this Bill, I should have quoted it—I do not want to put my authority higher than that of the noble Viscount—as something inclining belief in exactly the contrary direction.

I believe that people who have been interested in the electrical question realise that the conditions of London are exceptional. I am not going too far in saying that. That is a matter which we could discuss in detail, and I see no reason whatever why exceptional conditions should not be applied in London. We know that under the 1888 Act, London was cut up into a number of comparatively small districts, and that was done after a long Inquiry before the late Lord Balfour of Burleigh. It was cut up because, according to the views at that time, it was regarded as the most inexpensive method of supplying electricity. The contrary view of the pioneer engineer, Ferranti, was put on one side.

It appears to me that the worst form of enterprise in electricity is to have a hybrid committee of this kind. You may have private enterprise, or you may have municipal enterprise, but between the two you may have a hybrid body which really has no special interest either in economy or in any other way of carrying on a concern of this kind. There is, for instance, the London Water Board, which is one of the most extravagant bodies that ever was brought into existence. It is not actuated by municipal motives—that is, doing good for a particular municipality—nor is it actuated by private motives—that is, the interest of profit in business. There you have a hybrid body in which no one takes an intelligent interest, and the result is that the concerns of the London Water Board have really fallen into the hands of experts. We know what the extravagance has been.

In the few words that I have to say in supporting the Amendment of Lord Askwith, I desire to eliminate the special features of the London district. I do not know whether the noble Viscount is aware of this, but, as a matter of fact, the existing power companies extend over all the great industrial districts. At the present moment it is not a question of supplying a want. The want has been supplied. The argument of the noble Viscount is that, by introducing the principles of this Bill, you will get further economy. I do not want to go into that matter, because it is perhaps rather one for Second Reading, but it is a matter in regard to which there is great difference of opinion. That to which I want to call the noble Viscount's attention in support of what Lord Askwith has said is this.

If you look at Clause 5 as a whole, you will see that the local authorities have power to give assistance in a very wide form, and, indeed, so far as I know, they can go outside any powers which are now vested in them, and put a burden upon the rates. Take paragraph (d). It reads thus: to give financial assistance in any other form to the joint electricity authority. I take that as an illustration that the widest powers possible are given. None of the existing methods of controlling local authorities are maintained in any form. The local authorities are given a free hand to do exactly as they like. Is that right? I protest against it. In my view it is a novel principle which ought not to be allowed, and I think it is clear that it will probably lead to further expense to the ratepayers.

Look again at the provision stating that county councils and county borough councils may subscribe, although they are not within the area of the local authority and are not taking any supply from that area. What right have you to give a local authority power to make subscriptions in those conditions? The words of the Bill are: Provided that in the case of the council of a county or borough or county district, whether or not the council are authorised undertakers, or receive or intend to receive a supply of electricity from the joint electricity authority. If they are not authorised undertakers, and do not intend to receive a supply of electricity from the joint electricity authority, then such powers are not to be exercised, except in the case of the London County Council, without the consent of the Ministry of Health. That means that if the Minister of Health consents, the local authority can incur large expenditure upon a matter in relation to which the ratepayers of the district have absolutely no concern whatever. So far as the London County Council are concerned they do not even require to get the consent of the Ministry of Health.

I want to make my point clear in regard to the London County Council. I think they are in an exceptional position owing to the peculiar historical method in which electricity was originally instituted in the London area. No doubt the noble Lord knows what the obligation on the county council is. They cannot exercise their powers of purchase unless they exercise them as regards all the companies. That was put into an Act a long time ago in order to be fair to the private companies in the different parts of London. I am aware what effect the Amendment would have upon the London County Council, and I should have liked myself to have excepted that body, but as regards the general principle I think the noble Lord, Lord Askwith, is accurate.

VISCOUNT PEEL

I was very gratified to hear the noble and learned Lord say that he did not want to raise another Second Reading discussion upon this Bill. This Amendment, if carried, would clearly have a very serious effect upon the Bill. What are these joint electricity authorities? In many cases they would have no assets at all on which to raise money. Probably they would not want to raise money, because they might in many cases act merely as a sort of co-ordinating committee, and would only have very small expenses—a few clerks to deal with the business. In another case they might take over a power station, or enlarge a power station, and would require money to pay for it.

The whole point is whether or not they should raise this money in the cheaper or more expensive way. Noble Lords will admit that it is to the obvious advantage of all, Commissioners, undertakers and consumers, that they should get it as cheaply as possible, and pay as little interest as they can. For that reason it is laid down that these authorities "may," not "must"—most of the argument of Lord Askwith proceeded on the assumption that they must—finance in different forms these joint electricity authorities of which they are constituent members, not outside members. It is all to their advantage to do so, because in that way they and the authorised undertakers would get cheaper electricity.

I note that the noble and learned Lord was much disturbed at a county council being able to join in guaranteeing an issue of stock although it was not itself an authorised undertaker. What interest has a county council in all the businesses and factories in its own area? Merely from the point of view of the rates it has an enormous interest, and I do not know why he should have raised such a point as that. That being the object of this guaranteeing or financing, what does Lord Askwith say by his Amendment? He says that as you have on this body local authorities and public companies he will forcibly cut out of that body, as regards the power of financing, all the local authorities although they may be in a majority on that body, and that the only people who shall do any financing shall be the public companies. Does lie really want to wreck the whole finance of these joint electricity authorities? What is the position now? The local authorities on this joint authority would say to the companies: "We are going to get most of the advantage of this, but the financing is going to be done by the public companies." What are the companies likely to say to that? Will they receive with enthusiasm a proposition which throws the liability on themselves and gives all the advantage to some one else? This Amendment would have the effect of wrecking the possible finance of these joint electricity authorities.

The noble Lord made a series of assertions about finance which to my mind are entirely incorrect. As regards the borrowing of money, he stated that an absolutely blank cheque was given to the electricity authorities. He cannot have read the first clause of the Bill. There is no such thing as a. blank cheque. All these borrowings are subject to the authority of the Electricity commissaries. He may not approve of the Electricity Commissioners, but it is not right to say that an absolutely blank cheque is given to the electricity authorities. Then he told us that as regards the lending, or the guaranteeing, or financing, by local authorities they had an absolutely blank cheque. Again, the noble Lord is entirely wrong. All these financing operations are subject to the Ministry of Health. That is the second point on which the noble Lord misled your Lordships. He also said that there is no limitation whatever on the amount that is going to be laid on the ratepayers. I am amazed at these propositions. I look at Clause 13 and find that there is a distinct limitation to be made by the Electricity Commissioners on the prices to be charged. It says that they shall charge such prices as "shall be sufficient to cover their expenditure on income account (including interest and sinking fund charges) with such margin as the Electricity Commissioners may allow." Therefore, on this third point the noble Lord is entirely wrong. These prices must be such as to leave no charge on the ratepayers. As to the other point, that they may charge too much, if they did there would, of course, be no charge on the rates.

But who are the people on the joint electricity authority? They are the authorised undertakers, and is it really suggested that they will sell to themselves at extravagant prices? I find it really difficult to deal calmly with propositions of this kind in your Lordships' House. Another statement was that they could subscribe to business over which they have no control. First of all, they need not subscribe at all; they need not go into the joint authority at all. There is liberty everywhere, and to suggest that they are forced to subscribe, and to lay a charge on the ratepayers against their will, is simply to misstate, the operation of the measure.

LORD ASKWITH

I never said anything of the kind.

VISCOUNT PEEL

I took down what the noble Lord said. I think your Lordships will see that it is wholly impossible for the Government to accept an Amend- ment of this kind which would really destroy the whole finance of the measure. There are one or two Amendments on which, perhaps, it would be convenient if I made a statement now. These authorities are divided into two; first, those who are authorised undertakers, and, secondly, those who are not authorised. Your Lordships will see that different arguments apply to those who are authorised, and to those who are not, because the authorised undertakers are producing electricity themselves and spending the rates upon it. They would not go in for an operation of this kind unless they could limit what they spent on electricity, perhaps scrap a station and so on, and get their electricity at a cheaper rate. But as regards those authorities that are no authorised undertakers—county councils to which Lord Parmoor alluded—I am prepared to accept the Amendment to be moved by the noble Earl, Lord Bessborough, which would have the effect of limiting the amount, to that which would be produced by a penny rate.

THE EARL OF BESSBOROUGH

Does the noble Viscount say he is prepared to accept that Amendment?

VISCOUNT PEEL

I am prepared to accept that. Then there is a later Amendment to the same clause which limits the application of the clause to districts having a population of not less than 50,000; that is, those authorities who are not authorised undertakers and who have a population of less than 50,000 will not finance those authorities. I think those two are really considerable concessions to the opposition which has been raised. The last point I want to mention is this. Lord Parmoor said that there was no precedent, whatever for financing outside bodies in this way. If he will look at the Light Railway Acts he will see that is not SO.

LORD PARMOOR

Are the powers under those Acts given in the same words as here?

VISCOUNT PEEL

No.

LORD PARMOOR

It was the form in which it was given.

VISCOUNT PEEL

The form and not the substance; that is a small matter. They have general powers given to them to finance light railways. However, I do not wish to press that point further. The noble Lord will see that I cannot accept his Amendment, because it cuts right through the finance of the Bill, and in fact lays a quite unfair burden upon public companies by expecting them to do the financing and let the benefits go to the local authorities.

THE MARQUESS OF SALISBURY

I am very grateful to the noble Viscount for the offers which he has made to meet the objections regarding the burden on the rates, but I am not perfectly clear what they are. That is no fault of the noble Viscount, who is exceedingly lucid, but it is a little difficult to be certain, as conversation passes across the Table, exactly how far he is prepared to go. Before I say anything upon his offers I should like to point out very definitely to the noble and learned Viscount behind me that lie is not entitled to quote that great North Eastern Power Company as a point in his favour, because that body, which is an exceedingly successful body and does very fine work, is entirely a. private enterprise. It has nothing to do with municipalisation.

VISCOUNT HALDANE

It is the principle.

THE MARQUESS OF SALISBURY

It is the exact opposite of the principle which the noble and learned Viscount is advocating. It is the, very principle which those who are not certain of the wisdom of the Bill have been putting forward. The reason why private enterprise succeeds and municipal enterprise generally fails is because private enterprise is usually so much better managed from a business point of view. That is notorious. Everybody knows that, even when municipal enterprise does not actually fail, it does not succeed so well as private enterprise. It has great advantages, because it possesses in sonic respects greater resources, but it fails because it is not so well managed, and with all our desire to further the electrical development of the country—and I heartily agree with every word the noble Viscount has said as to its importance—we are afraid that these hybrid bodies, partly composed of the representatives of the local authority and partly of the representatives of the companies, will fall, as it were, between two stools. They will not be very well managed because of their municipal representatives, and they will not represent the ratepayers thoroughly because of their company repre- sentatives, so that they will be unsatisfactory from whatever point of view you regard them.

I should like to say one word about London. I fully understand the point of view of the noble Lord opposite, that London is a special case. London electrical enterprise is comparatively easy, because the distances of the constituent parts are so small. All that dead weight of main transmission lines which burdens the capital of provincial undertakings does not apply to London, so that London starts in a very much better position. But I do not think we need pay too much attention to London, because London is so vastly important that it will be quite easy and indeed appropriate, for London to come to Parliament with its own Bill and its own proposals, which would, of course, receive the greatest attention. Indeed, I understand that under the provisions of the Bill, London will have to come to Parliament before its proposals are finally sanctioned, because London is in a special position. While we fully recognise, therefore, that the case of London is peculiar, I would ask your Lordships not to pay too much attention to it.

One word more may be said about London. I do not pretend to know very much about these subjects, but it is very doubtful whether the ratepayers have been thoroughly successful under municipal enterprise, in London. The case I have in mind is not perhaps confined to the county, but covers the whole London area; I refer to the Metropolitan Water Board. Everybody knows how frightfully expensive the Metropolitan Water Board has been, and I do not think this is irrelevant in considering what is likely to happen in the case of electrical enterprise. We must be practical in this matter, and I recognise the consequences of the Division which has just taken place in your Lordships' House. I do not think it would be right to ignore it. The noble Viscount comes forward and says that this Amendment is practically inconsistent with the principle of the Bill. I do not think that it is altogether inconsistent, but it is certainly a very important Amendment. Just consider for a moment that under Clause 1 power is given to these joint electricity authorities to borrow; that is to say, they are put in the same position as private enterprise would be. Why is that not sufficient? I may be wrong, and, if so, I willingly give way to the noble Viscount.

VISCOUNT PEEL

The noble Marquess is certainly wrong, because in private enterprise, as the noble Marquess knows, we can get any money we like, to the extent that we can persuade people to lend it to us. In this case they borrow subject to the authority of the Electricity Commissioners. They cannot borrow as they like.

THE MARQUESS OF SALISBURY

I have no doubt the Electricity Commissioners would not interfere. The question is whether they could persuade anybody to lend them the money they require. That is what we doubt.

VISCOUNT PEEL

They win do so if they can get the guarantee of those authorities.

THE MARQUESS OF SALISBURY

In other words, they are so much less trusted than private enterprise that they cannot get money in the open market unless they have this guarantee.

VISCOUNT PEEL

They have not such good security.

THE MARQUESS OF SALISBURY

They have the enterprise itself.

VISCOUNT PEEL

They may not have the enterprise. They may be just a committee with only the administrative expenses to draw upon.

THE MARQUESS OF SALISBURY

That may he so, but surely that is not worthy of the argumentative power of the noble Viscount, because he does not intend these joint electricity authorities to he nothing but committees affording guarantees. He intends them to be great municipal trading enterprises.

VISCOUNT PEEL

In some cases—

THE MARQUESS OF SALISBURY

But surely that is what he intends

VISCOUNT PEEL

—not necessarily in all.

THE MARQUESS OF SALISBURY

No doubt there will be exceptions, but that is the main object, and quite obviously the main object, of the noble Viscount. Anybody who has gone into this question for ten minutes knows that this is what is really intended—a vast organisation of electrical authorities who own very large businesses, build or take over huge generating stations, and spend a great deal of money. The noble Viscount hopes, as I also hope, that they will earn a great deal; that they will earn enough, in fact, to balance their accounts. But we are afraid they will not, and that is our difficulty, We are very much afraid that they will not earn enough, and then the ratepayers will have to make good the deficiency. I am aware that the noble Viscount says the local authorities need not subscribe unless they like, but the individual ratepayer—poor man!—will have to do as he is told by the authority, and his only chance will be to turn out the authority at the next election which, as everybody knows, is not always a. very effective check in local affairs. As a matter of fact, the ratepayer will have to bear the burden.

Let us see what concession the noble Viscount has made us, and I am bound to say he has handled the matter very courteously. He proposes, as I understand, that the ratepayers' contribution should be limited to a penny rate.

VISCOUNT PEEL

in certain cases.

THE MARQUESS OF SALISBURY

I will give way to the noble Viscount at once. I am only anxious to find out exactly what he proposes.

VISCOUNT PEEL

What I said was that where the local authorities were not authorised undertakers—

THE MARQUESS OF SALISBURY

I understood that point; but supposing the local authorities are authorised undertakers, how much are they to be entitled to spend?

LORD PARMOOR

The Amendment goes beyond that.

THE EARL OF BESSBOROUGH

May I interrupt for one moment? While the noble Viscount was speaking, I ventured to interrupt him to ask whether he accepted my Amendment as on the Paper, and I understood the noble Viscount to reply in the affirmative.

VISCOUNT PEEL

Perhaps the noble Marquess would prefer to continue his observations. I think it is better not to answer a large number of questions across the Table.

THE MARQUESS OF SALISBURY

I am only anxious to suit the noble Viscount's convenience in the matter.

VISCOUNT PEEL

I thought it was the convenience of the noble Marquess that I was consulting.

THE MARQUESS OF SALISBURY

I want to know how far the suggestion goes. If it is said that the limitation is a limitation only upon those local authorities who are not undertakers, then I must say I think it is rather hard upon the body which I more or less represent—namely, the counties at large. Why should the counties at large be called upon to pay up to a penny rate? I can understand the argument that the undertaking local authorities might contribute. I suppose the contention is that an undertaking local authority has got to spend the ratepayers' money in any case, and therefore why not in this as well as in the present form? But that does not apply to the county councils. At present they do not pay anything towards these electrical enterprises, and I understand from the noble Viscount that all he will do is to say that they shall not be allowed to spend more than a penny rate in this matter. I do not think they ought to spend even a penny rate.

VISCOUNT PEEL

I do not think they will.

THE MARQUESS OF SALISBURY

Then what is the good of the Amendment?

VISCOUNT PEEL

Perhaps I may explain. My contention has been all through that practically nothing will fall upon these non-undertaking authorities, and I still maintain that, but there was so much anxiety shown in various quarters of the House as to this unlimited power that, after a long conference at which, as the noble Marquess knows, I could not be present, it was settled that there should be some limitation. Now, having put in this limitation of a penny, the noble Marquess sap: "Why must they spend up to a penny?" I wanted to meet the noble Marquess by putting in this limitation, and as soon as I do put it in he wants to suggest that it should not be spent. I think he is rather hard upon me.

THE MARQUESS OF SALISBURY

I was present and I know what passed, but I do not think it is really of great advantage to your Lordships to give fragments of conversations which were in their nature controversial. Therefore, I shall avoid saying anything about those conversations. I do not say that what the noble Viscount says is inaccurate, but it is not complete. I think there would be a great deal to be said for this Amendment if he were to say that there should be a limit of a penny rate all round, on all local authorities, whether undertaking or not. By way of a compromise there is something to be said for that; but to say that non-undertaking authorities should be limited to a penny, when they ought; not to contribute at all, and that undertaking authorities should not be limited at all, does rot appear to me to be much of a concession. If the noble Viscount had said to the noble Earl, Lord Bessborough, "We will limit it to a penny in all cases," then, although we should have given up something, we should, at any rate, have gained something, because the undertaking authorities would be limited. As it is it seems to me that, he is giving us the shell without the oyster.

May I say one word further? I speak on behalf of the County of Hertford, the authority of which county is very much opposed to this Bill; and it is felt by a very important representative of that body that the idea that this measure is purely voluntary is really a snare and a delusion—that you cannot resist when perhaps your neighbours have given way. We meet with that sort of thing over and over again in county administration; the indirect compulsion which comes from other local authorities having taken particular steps in local government. A common case is the making of roads. If a road is made up to a particular boundary the local authority beyond that boundary is indirectly compelled to continue the road. So you have this indirect compulsion, and the result of giving power to the county councils to subscribe out of the ratepayers' money will, in a number of cases, be a compulsion upon them to do so. I think that is evident, and everybody who knows how county government works knows that that is the case.

Therefore, our contention has always been that Clause 5 is defective. We do not think that the ratepayers ought to be called upon to subscribe at all, but if your Lordships have decided that point, then we say that the counties at large ought not to be called upon, directly or indirectly, to subscribe at all, anti that there ought to be some limit placed upon the undertaking authorities. I slated that I would not refer to what passed outside this House, but I think, after what the noble Viscount has said, that it is only fair I should explain that an idea was laid before us not only to limit the contribution of non-undertaking authorities but also that of undertaking authorities. Of course, I am not at liberty to say exactly what that proposal was. I merely state it to your Lordships and the Government, and I shall be very glad if the noble Viscount would elaborate a little further what concessions he proposes to make. I quite understand his concession about the size of the local authorities. That is certainly of value. He also said he had a concession to make about the penny rate. I have tried to explain to your Lordships how fallacious that concession is, and I venture to suggest that he should go a little further.

VISCOUNT PEEL

I do not know whether it is convenient on this Amendment to discuss these concessions at some length, or whether your Lordships would prefer to deal with them when we come to them. But if the noble Marquess wants it I will deal with them in two words. First, there is the question of limitation to the penny rate. I do not think it is a good Amendment because I do not think it is in the least necessary, and I put it forward only in the nature of a concession to meet the feeling expressed in this House. That is with reference to those authorities who are not authorised undertakers, and to give confidence, if you like, to the ratepayers, and possibly to the County Council of Hertfordshire. Then the noble Marquess says: "Why not extend it all round, to include those who are authorised undertakers as well?"

THE MARQUESS OF SALISBURY

That is Lord Bessborough's Amendment.

VISCOUNT PEEL

I am not sure that it does apply to that, but I think the noble Marquess appreciates the difficulty of treating in the same way those authorities who are not undertakers and those who are. I think he appreciates the position of those who are authorised undertakers, because in their case it may very likely be that they get off a considerable amount of expenditure by being able to take their power from the local authority. There was a discussion on this point, and I will read out to the noble Marquess a proposed Amendment to meet their case. I do not put it forward with any great enthusiasm; it is clue only to the pressure in different parts of the House. The words are that the raising of money shall not be authorised exceeding in cases where the council are authorised undertakers, the estimated annual amount of any capital charges from which the council will be relieved by reason of taking a supply in bulk from the joint electricity authority; such estimated amount to be determined by the Electricity Commissioners, whose decision shall be final. That is an attempt at any rate to limit the extent to which these undertakers shall be financially interested in these particular schemes—limiting it to the amount which they would have had to expend, according to the estimate of the Electricity Commissioners, in developing their stations and supplying their statutory requirements. I shall not deal with it any further now, because we are not discussing this question on the Amendment. I rose only to show what were the three concessions which the Government were prepared to make to the noble Marquess.

THE MARQUESS OF SALISBURY

I think it would be quite impossible to ask us to accept so difficult a matter—

VISCOUNT PEEL

I am not asking the noble Marquess to accept it now. I am only indicating it. When we come to it I will deal with it fully. But noble Lords will see that it is very confusing for me, in response to requests, to explain fully Amendments at which we have not yet arrived.

LORD ASKWITH

Perhaps we might get on with my Amendment?

VISCOUNT PEEL

I thought, perhaps, the noble Lord might withdraw it.

LORD ASKWITH

I have not seen any of the proposed Amendments. There is an Amendment moved by me to which I propose to adhere.

On Question, Amendment negatived.

THE EARL OF BESSBOROUGH moved, in subsection (1), after "any county or borough or county district," to insert "having a population according to the last published census returns for the time being of not less than fifty thousand persons." The noble Earl said: This is one of the Amendments referred to across the Table in the discussion between the noble Viscount and the noble Marquess. I gathered from what the noble Viscount said that the Government were prepared to accept this Amendment at any rate.

VISCOUNT PEEL

We will accept this Amendment if the noble Earl will be good enough, on purely drafting grounds, to leave out the word "persons" at the end. I believe the word is unnecessary.

Amendment moved— Page 3, line 36, after ("district") insert ("having a population according to the last published census returns for the time being of not less than fifty thousand").—(The Earl of Bassborough.)

LORD BEARSTED

If the Amendment were carried its effect would be to exclude the City of London, which would be rather absurd, for, although the night population is under 50,000 the day population is over 400,000. I hope the noble Viscount will be able to provide for the protection of the City of London if this Amendment is inserted.

VISCOUNT PEEL

I will, if necessary, but I think the City is protected later on. But if it is not clear it will be made so.

On Question, Amendment agreed to.

LORD ORANMORE AND BROWNE moved, in subsection (1), to leave out "or partly." The noble Lord said: The object of this Amendment is to meet an anomaly created under the clause. Under the clause, if any part of the county is within the district of an electricity authority the county council of the county would contribute by loan or gift to the funds of the authority at the expense of the county rates, which would mean that the ratepayers in the part of the county outside the authority's district, would be rated for the contribution, when that part of the county could in no circumstances obtain any advantage whatever, or any supply from the authority. The same observation equally applies to all the other authorities, including metropolitan boroughs, municipal boroughs, and even small urban and rural districts.

To illustrate what I mean let us take the county of Buckingham or Berkshire, part of which would be in the London district. As the clause stands at present it would be possible for that part of the County of Buckingham or Berkshire, which would not in any way benefit, as it would not be within the district, to have its credit pledged, or even perhaps to be rated, for a scheme in which it is not interested. I do not think this can be intended. I believe there is an Act of 1888 under which a rate can be levied over portion of a county and not over the county at large. I am told this is seldom done, but the Act exists and I have reason to believe it is possible to apply it to a case like this. I think the noble Viscount will agree with me that there is a distinct hardship in the case of an unfortunate county which finds itself in such a position, and I hope he will be able to accept my Amendment or make some suggestion which will relieve such portion of a county from having a contribution levied upon it.

Amendment moved— Page 3, lines 36 and 37, leave out ("or partly")—(Lord Oranmore and Browne.)

LORD MONK BRETTON

I should like to point out to the noble Viscount in charge of the Bill that there is another side to the shield as well as that presented by the mover of this Amendment. If the Amendment is carried, whatever burden is connected with the matter would be thrown entirely on London and Middlesex, and the area takes in part of Berkshire, Buckinghamshire, Hertfordshire, and so on. Therefore, he would be robbing Peter to pay Paul.

VISCOUNT PEEL

I think there is a difficulty, because these electricity authorities, for a great many reasons—geographical, electrical, economic and so on—will not always necessarily correspond with the county divisions, and in those cases, as the noble Lord suggests, it might be unfair that a rate should be levied over the county or that portions of counties might possibly have double rates levied upon them. If the noble Lord does not press his Amendment in the form in which he has moved it I will undertake to bring up an Amendment on the Report stage dealing with that aspect of the case. If the rates are made leviable only over those portions affected I think it will meet the difficulty.

LORD ORANMORE AND BROWNE

I am much obliged to the noble Viscount, and I will withdraw my Amendment on that understanding.

Amendment, by leave, withdrawn.

THE EARL OF BESSBOROUGH moved, at the end of subsection (1), to insert: "and that nothing in this Act shall authorise the raising of any money or the giving of any guarantee by any such council which would involve the council in any greater annual liability than could be met by a rate of one penny in the pound on the rateable value of the hereditaments in respect of which such council is entitled to levy a rate at the time when the same is raised or given."

The noble Earl said: I beg to move the Amendment which has already been referred to in the course of the debate, to limit the ability of a local authority to pledge the rates to a rate of one penny in the £. I am not in the least wedded to the sum of one penny, and I gather that the noble Viscount on behalf of the Government thinks it is very high. I admit that I think so. I took a penny out of the Housing Act; but obviously that was a concern of far greater national importance than this is.

VISCOUNT PEEL

No. no.

THE EARL OF BESSBOROUGH

I think the noble Viscount will agree that the matter of housing after the war was even more important then the electricity supply.

VISCOUNT PEEL

I think employment was even more important.

THE EARL OF BESSBOROUGH

I was only comparing the question of housing with that of improving the electricity supply, which existed even before the Government thought of their Bill of 1919. That is the only reason why I took the sum of a penny, and if your Lordships think that a smaller amount should he inserted my Amendment is capable of adjustment. With regard to the noble Viscount's remarks on the subject of the Amendment, I am not clear to what extent the concession he suggested goes. When I asked him whether he accepted the words of my Amendment I understood him to say simply, "Yes"; but from further conversation he had across the Table with the noble Marquess, I understood that the acceptance was not so unqualified as I had previously imagined it to be. Perhaps it would be better that I should formally move my Amendment in order that the Government may have an opportunity of saying exactly what is meant by the concession.

Amendment moved— Page 4, line 17, at end insert the said words.—(The Earl of Bessborough.)

VISCOUNT PEEL

I think I did state that I accepted it, but I should have explained at greater length that it was a slightly qualified acceptance, because, as I said later on to the noble Marquess, this limitation of one penny in the £ ought not, I think, to apply to those authorities who are authorised undertakers. I am quite ready to accept it as regards those authorities who are not authorised undertakers. Therefore, perhaps the noble Earl would either move it himself or allow me to move it in that slightly altered form.

In regard to the second point, perhaps the noble Earl will allow me to read out again the particular Amendment which I propose to move, that is to say— In cases where the council are authorised undertakers, the estimated annual amount of any capital charges from which the council will be relieved by reason of taking a supply in bulk from the joint electricity authority; such estimated amount to be determined by the Electricity Commissioners, whose decision shall be final. That is to say, their liability will be limited by the amount to which they would be relieved through being able to take their electricity supply in bulk from the joint electricity authority. That is the limitation which I suggest to the noble Earl, and if he choose to withdraw the Amendment he has just moved, I would move the whole Amendment, including his, in that form.

THE EARL OF BESSBOROUGH

I am very much obliged to the noble Viscount for proposing to meet me in that way, but I hesitate to commit myself at once to agree with the form of words he has suggested, because although he was good enough to give me the words, I have only just seen them and it is a little difficult to take in the effect of such a long clause without studying it. I am prepared, however, to withdraw my Amendment on the understanding that the noble Viscount puts forward another on the Report stage.

VISCOUNT PEEL

I think perhaps I had better move it at once, and then noble Lords will have full time to study it.

Amendment, by leave, withdrawn.

LORD PARMOOR

The noble Viscount's Amendment appears to be a very valuable one. But I should like to know whether it means that the commitment of what I may call an authorised county will be limited to the amount of benefit it receives, estimated by the Electricity Commissioners, and that it cannot go beyond that point.

VISCOUNT PEEL

Roughly speaking, that is what it is.

LORD PARMOOR

I have not all the words, but that is the substance of it?

VISCOUNT PEEL

That is the general substance of it. It is six of one and half a dozen of the other, if I may put it in that way.

THE MARQUESS OF SALISBURY

We are very grateful to the noble Viscount, but, of course, until we have had time to consider it we must not be considered to be pledged to it.

VISCOUNT PEEL

I quite understand. The Amendment I desire to move is in the following form:

"Clause 5, page 4, line 17, at end insert: 'Provided also that nothing in this section shall authorise the raising of any money or the giving of any guarantee by any such council as aforesaid which would involve the Council in an annual liability exceeding—

  1. (a) in cases where the council are not authorised undertakers, the amount which would be produced by a rate of one penny in the pound; such amount to be estimated for the purposes of this section in accordance with regulations made by the Minister of Health; or
  2. (b) in cases where the council are authorised undertakers, the estimated annual amount of any capital charges from which the council will be relieved by reason of taking a supply in bulk from the joint electricity authority; such estimated amount to be determined by the Electricity Commissioners whose decision shall be final.'"

Amendment moved— Page 4, line 17, at end insert the said new proviso.—(Viscount Peel.)

On Question, Amendment agreed to.

LORD ORANMORE AND BROWNE moved to leave out subsection (4). The noble Lord said: This is what is known as the compulsory subsection, to which refer- ence has been made on several occasions. The clause is so framed that it is doubtful whether it is only authorised undertakers represented on the authority, or any undertakers within the district of the authority, who are to contribute to the trading losses of the authority. The Act of 1919 contemplates that when the Commissioners have determined an electricity district and a joint authority has been set up, some or all of the authorised undertakers now generating a supply in the district will hand over their stations voluntarily to that authority, will be represented on the authority, and will be taking supplies of energy possibly from the stations they have handed over. Under the clause, if the authority makes a loss, the undertakers represented on the authority can be compelled to make up this trading loss.

I submit that these provisions are undesirable in the Government's interest, because they will obviously prevent undertakers from handing over their stations, and for that reason they will probably prevent the formation of a. joint authority. It is really an indication on the face of the Bill that the framers of it contemplate—though the noble Viscount has told us that is not the case—that the authority will not be able to supply so cheaply as undertakers who are already supplying the public. Again, it seems to be inconsistent with Clause 13 of the Bill, which says that the authority are to fix such charges as will make their accounts balance over a number of years. The words objected to are further open to objection in that they seek to enable the Commissioners to allow other bodies represented on the authority—that is, county councils and local authorities in the district—to snake contributions out of the rates to the administrative expenses, which are really a trading loss of the authority. Surely that is giving a wide additional power of spending the rates, and one would hardly think it was necessary, in view of the powers in Clause 5, subsection (1) (d), to county councils and local authorities, to give financial assistance in any other form to the authority. The subsection also puts the undertakers under the same obligation as that of county councils and local authorities to contribute to the administrative expenses of the authority. This is really another way of allowing them to make up trading losses as such expenses are, of course, part of the cost of running the business.

Your Lordships will consider that in the case of any commercial company it is necessary—the noble Viscount told us, I think, it was necessary—to have offices and clerks and various persons of that kind. It is equally necessary in the case of companies. They always have an office, secretaries, clerks, and even have directors' fees to pay, but those are supposed to form part of the ordinary expenses of running the company, and are put against the profits which are expected to be earned. I hope that I may have the support of the noble and learned Viscount, Lord Haldane, to this Amendment, because he was so very sanguine and optimistic as to the result of this Bill. I noted that he said that it proposed to make a saving of 55,000,000 tons of coal, and that he did not believe it proposed to compel anybody to pay anything, but would mean a reduction of 200 per cent. in the cost of electricity. My noble friend, Lord Peel, also said the effect of the Bill would be to reduce rates, and that if it did not do that the whole Bill would be a failure. I think, therefore, there is a very strong case showing that this clause is absolutely unnecessary, and I hope that the Government will not insist upon it. This is one instance of what is absolute compulsion—not indirect compulsion but absolute compulsion—in the Bill. I beg to move.

Amendment moved— Page 5, lines 8 to 16, leave out subsection (4).—(Lord Oranmore and Browne.)

THE LORD CHAIRMAN

I suggest that we put line 8 in case this Amendment is defeated, and we shall then save the rights of a later Amendment. I put the Question that line 8 stand part.

VISCOUNT PEEL

There is a further matter raised on this by Lord Askwith. Here two points are raised, first of all the question of administrative expenses, and secondly, provision for temporary deficiencies. I think the argument of the noble Lord was directed rather more critically to temporary deficiencies than to administrative expenses, and I can deal quite shortly with that point. He will see that there must be, at any rate, some small administrative expenses when the authority is set up. As to the other point, that of temporary deficiencies, I think he laid most weight upon that. In that regard the clause is, to sonic extent, I admit, open to criticism. Temporary deficiencies are charged over all those who are represented on the authority. Really it ought to fall on the undertakers who are receiving the supply, because it would appear, if there is a deficiency, that they have perhaps paid too little for their electricity. I think it fair that the temporary deficiencies should be limited to those receiving the supply, and should not include those who are not receiving it. If the noble Lord will not press his Amendment now, I will bring up an Amendment on Report to meet the point.

LORD ORANMORE AND BROWNE

I am much obliged, and I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

LORD ASKWITH

Would it be possible that the proposed new clause could be put in now so that we may see it before Report. It may not require Amendment.

THE MARQUESS OF SALISBURY

Can the noble Viscount state how he proposes to deal with "or required"?

VISCOUNT PEEL

I do not intend to disturb the words "or required"; that is why I was waiting for the noble Lord, Lord Askwith, to make his point on that. It is only as regards the subsequent part dealing with temporary deficiencies that I propose an alteration. As regards administrative expenses I propose to allow the words "or required" to remain in the Bill. But I will read the Amendment— if the receipts of the joint electricity authority on revenue account in any year are insufficient to meet the charges payable out of revenue in that year, the deficiency shall, unless provided for out of a reserve fund, be apportioned amongst the authorised undertakers within the district taking a supply of electricity from the joint electricity authority in proportion to the number of units of electricity supplied to such authorised undertakers in such year. Provided that in any case in which it appears to the joint electricity authority that the deficiency in any financial year can by a reasonable adjustment of charges or otherwise be made good out of moneys receivable by the joint electricity authority in any succeeding financial year or years, or that the deficiency is so small as to justify postponement of any apportionment, the joint electricity authority may refrain from making any such apportionment and such deficiency may be included in the charges payable out of the revenue in any succeeding year or years.

THE MARQUESS OF SALISBURY

I think the better course would be to put those words in the Bill and we could then see them before the Report Stage.

VISCOUNT PEEL

The effect is extremely simple. Only the authorised undertakers would be liable for these deficiencies and not the other authorities represented, and if the Electricity Commissioners think any deficiency could well go over to the next year they could order that to be done. The words will come as an addition to Clause 13.

THE MARQUESS OF SALISBURY

Does the noble Viscount in the meantime strike out this subsection (4)

VISCOUNT PEEL

No. The noble Lord, I think, agrees to withdraw his Amendment if I put these words in.

LORD ASKWITH

The noble Viscount spoke of these deficiencies as being s mall—

VISCOUNT PEEL

The noble Lord is under the impression that his Amendment only deals with administrative expenses. Deficiencies is another point, and there is no "requiring" in connection with them.

LORD ASKWITH

I think there is.

THE MARQUESS OF SALISBURY

My difficulty is this; it is merely a matter of procedure. As far as I could gather the noble Viscount's proposed Amendment covers the same ground as, and is to some extent inconsistent with, subsection (4). If when we get to Clause 13, he is going to put his Amendment in, then he must deal with subsection (4) now, because it will not be in order to put in an inconsistent Amendment later. I may have misheard him, but I think his Amendment is not altogether consistent with subsection (4) as it changes the incidence of the burden of making good these deficiencies.

VISCOUNT PEEL

It does change the burden of the deficiencies, and if there is any difficulty about it I will introduce it on Report.

LORD ASKWITH

If these deficiencies are to be so small, and the administrative expenses so small, one has no objection to the postage of stamps, etc., being split up among these different bodies. But a "temporary deficiency" might mean anything. The two Amendments I have down would leave out "or requiring," and would make the subsection read— A scheme constituting a joint electricity authority may include provisions authorising authorised undertakers and companies and other bodies represented … And so on. The authorised undertakers and companies, and other bodies represented, would contribute. The noble Lord, Lord Emmott, has an Amendment down to the same effect which is much clearer in language. Perhaps the noble Viscount will explain the meaning of "requiring."

VISCOUNT PEEL

I shall be glad to do so. It is not a dangerous provision. The noble Lord has noticed that it is the scheme constituting the joint electricity authority which may include the provision "requiring." First of all that scheme has to be agreed to by those who are joining the authority, and secondly, by both Houses of Parliament. A good deal of consent has to be obtained before this limited amount of compulsion operates. Where there are small administrative expenses they will be divided among the different authorities. Some of these companies and authorities feel that if that is so, if the amount is to be divided, it would be rather tiresome if eight or nine paid and two or three others refused, and it was agreed that it should be compulsory they should pay. That is the amount of compulsion there is in it. First of all there is agreement, and then there is this little bit of compulsion in order to make the agreement valid.

THE MARQUESS OF SALISBURY

What makes it important is that there is no definition of what "temporary deficiency" means. A temporary deficiency may be small, or it may be large, so far as the language of the Bill is concerned, and in that case it would seem to require a rating authority to make good a large deficiency. That would mean a large measure of compulsion.

VISCOUNT PEEL

The Amendment I propose to insert makes considerable difference. It affects the size of the temporary deficiency and also limits the payment of the deficiency to those undertakers who are receiving a supply. If there is a deficiency it does not seem unfair that it should be met in equal proportion according to the amount of electricity received. That is the whole point.

LORD ASKWITH

After the explanation, and in view of the proposed Amendment, I do not desire to move my Amendments now.

LORD ORANMORE AND BROWNE had on the Paper an Amendment to move, in subsection (4), after "undertakers," where that word firstly occurs, to insert "represented on the authority." The noble Lord said: I think as the clause stands it is rather doubtful whether this is limited to them or not.

VISCOUNT PEEL

The Amendment is not necessary as these undertakers would be represented on the joint electricity authority. The Amendment is superfluous.

LORD ORANMORE AND BROWNE

If the noble Viscount tells me the Amendment is superfluous I accept his statement, and will not move.

LORD BEARSTED moved, at the end of the clause, to insert the following new subsection— (6) This section shall apply in the case of the City of London as if the City of London were a county and the common council of the city the council thereof, and as if the raising of money for the purpose of lending or subscribing to securities under this section were a purpose for which the common council may borrow under and in accordance with the City of London Sewers Acts, 1848 to 1897.

Amendment moved— Page 5, line 22, at end insert the said new subsection.—(Lord Bearsted.)

VISCOUNT PEEL

I accept that.

On Question, Amendment agreed to.

Clause 5, as amended, agreed to.

THE EARL OF BESSBOROUGH moved, after Clause 5, to insert the following new clause: .Any authorised undertakers may lease to a joint electricity authority and a joint electricity authority may take a lease from any authorised undertakers of the whole or any part of their undertaking. Any such lease shall be subject to the approval of the Electricity Commissioners and subject thereto may be with or without the option of purchase by the authority of the property or any part thereof leased thereby and may be made to and taken by the authority for such period on such terms and conditions including the vesting in the authority of any rights, powers and obligations of the transferring undertakers under any contract or agreement entered into by such undertakers and relating to the supply of electricity as may he agreed upon between the authority and the transferring undertakers.

Amendment moved— After Clause 5, insert the said new clause.—(The Earl of Bessborough.)

VISCOUNT PEEL

I am prepared to accept this Amendment if the noble Earl will substitute the word "undertaking" for "property."

THE EARL OF BESSBOROUGH

I am much obliged to the noble Viscount. I will do so.

On Question, Amendment agreed to.

Clause 6:

Expenses of Electricity Commissioners.

6.—(1) The period of two years mentioned in section twenty-nine of the principal Act shall be deemed to extend to the thirty-first day of March, nineteen hundred and twenty-two, and the advances made to the Commissioners under that section shall be repaid, with interest as therein provided, by instalments before the thirty-first day of March nineteen hundred and twenty-five, so that not more than two-thirds thereof shall be outstanding on the thirty-first day of March, nineteen hundred and twenty-three, and not more than one-third thereof shall be outstanding on the thirty-first day of March, nineteen hundred and twenty-four.

(2) The Electricity Commissioners may during the financial year current at the passing of this Act make the apportionment among and demand upon the joint electricity authorities and authorised undertakers provided for by the said section, and such apportionment, and any subsequent apportionment under that section shall be made in accordance with the number of units of electricity generated by each joint electricity authority or authorised undertaker within Great Britain in the year ending the thirty-first day of December next preceding that for which such apportionment is made; and in any case where an authorised undertaker obtains a supply from any source other than the joint electricity authority or an authorised undertaker the number of units of electricity so obtained by such authorised undertaker shall be deemed to have been generated by that authorised undertaker.

(3) Every such joint electricity authority and authorised undertaker shall furnish a statement of the number of units so generated or obtained by them to the Electricity Commissioners not later than the thirty-first day of January in each year, and in the event of any such authority or undertaker failing to supply such particulars on or before that date the Electricity Commissioners may proceed with the apportionment, and for that purpose may make any necessary estimates.

(4) The apportionment when made shall be conclusive for all purposes:

Provided that if it subsequently appears to the Electricity Commissioners that for any reason the apportionment for any year ought to be revised, they may revise the apportionment, and when determining the apportionment in any subsequent year make such adjustments as may be necessary to give effect to such revision.

(5) If any joint electricity authority or authorised undertaker fail to pay to the Electricity Commssioners the sum apportioned to them within two months after receiving the demand therefor, interest at the rate of six per centum per annum shall be payable on the amount demanded from the date of demand to the date of payment.

(6) The Electricity Commissioners may in estimating their expenditure for the purposes of subsection (1) of section twenty-nine of the principal Act include a reasonable sum in order to provide a working balance for the year.

(7) Any sums due from any joint electricity authority or authorised undertaker under section twenty-nine of the principal Act, as amended by this section, shall be recoverable by the Electricity Commissioners summarily as a civil debt.

VISCOUNT FALMOUTH moved, in subsection (2), to substitute "sold" for "generated," where that word firstly occurs. The noble Viscount said: The object of this Amendment is to put all the generating stations of the various authorities on the same footing. At the present moment different generating stations have different methods of running their auxiliary machinery. In some stations you will find that the machinery is run electrically, and in other stations by steam. If you make the stations pay on the amount generated, the stations that generate their auxiliary power by steam Avid have considerable advantage over the stations which use electricity for that purpose. A considerable sum would be involved; I think that in some of these large districts as much as £4,000 and £5,000 is the assessment that the electricity authorities have made upon some of these stations. It is only fair that all the producers should be put on the same basis.

Amendment Moved— Page 5, line 42, leave out ("generated") and insert ("sold").—(Viscount Falmouth.)

VISCOUNT PEEL

This Amendment affects the question of the basis upon which payments should be made by a business to the Electricity Commissioners, and I understand that the noble Viscount wishes to substitute the basis of units sold for that of units generated. That has been, of course; fully discussed, and it was settled that, on the whole, units generated made a better basis. The point, however, is rather a difficult one—there are certain difficulties as to supplies in bulk which I need not discuss now—and I make this offer to the noble Viscount. If he will not press his Amendment now but be good enough to put it down on Report, the matter shall be discussed in the meantime to see whether we can arrive at any method of payment based on his suggestion.

VISCOUNT FALMOUTH

I am obliged to the noble Viscount, and will follow his suggestion.

Amendment, by leave, withdrawn.

THE LORD CHAIRMAN

I understand that covers all the other Amendments which the noble Viscount proposes to this clause.

VISCOUNT FALMOUTH

That is so. I do not move the five following Amendments, which are consequential.

Clause 6 agreed to.

Clause 7 agreed to.

Clause 8:

Use of main transmission lines by agreement.

8. A joint electricity authority may, by agreement with any authorised undertakers or other persons, use any main transmission line of those undertakers or persons for such time and upon such terms as may be agreed.

THE EARL OF BESSBOROUGH moved, after a joint electricity authority may,"to insert" but subject to the provisions of the Acts or Orders of such authorised undertakers." The noble Earl said: This is quite a simple Amendment.

Amendment moved— Page 7, line 1, after ("may") insert ("but subject to the provisions of the Acts or Orders of such authorised undertakers").—(The Earl of Bessborough.)

VISCOUNT PEEL

The Amendment is practically drafting, and I am prepared to accept it in a form which will make the clause read as follows— 8. A joint electricity authority may, by agreement with any authorised undertakers or other persons, use, subject in the case of authorised undertakers to the Acts and Orders relating to their undertakings, any main transmission line of those undertakers or persons for such time and upon such terms as may be agreed.

THE EARL OF BESSBOROLIGH

I am much obliged to the noble Viscount, and will withdraw my Amendment in favour of the Amendment which he suggests.

Amendment, by leave, withdrawn.

Amendment moved— Page 7, line 2, after ("use") insert ("subject in the case of authorised undertakings to the Acts and Orders relating to their undertakings").—(Viscount Peel.)

On Question, Amendment agreed to.

Clause 8, as amended, agreed to.

Clause 9 agreed to.

THE EARL OF BESSBOROUGH moved after Clause 9, to insert the following new clause:

".—(1) Whenever a generating station is transferred to a joint electricity authority they shall be under an obligation

  1. (a) thenceforth to supply to the authority, company, or person from whom it is transferred such quantity of electricity as may be required for the purposes of the undertaking for which the generating stat ion was established and as regards the amount that could have been generated at the generating station by that authority, company, or person at a. price not greater than the cost at which it could have been so generated; and
  2. (b) in the event of any change in the type of current, frequency or pressure to pay such expenses as the authority, company, or person may necessarily incur in consequence of such change;
and if any question arises as to such amount or cost or expenses the question shall be determined by the Electricity Commissioners, and in determining such cost regard shall be had to capital charges (including interest on capital), cost of fuel and labour, and other costs of generation and to any reduction of costs which might reasonably have been expected to accrue from any improvement of the generating station and plant therein.

(2) Where a generating station which is transferred to a joint electricity authority is in course of construction, extension, or repair, the rights and liabilities of the former owners thereof under any contract for such construction, extension, or repair shall be transferred to the joint electricity authority."

The noble Earl said: I cannot pretend that this new clause is in any way original, because it follows closely upon what the Government put in their Act of 1919, and also in the Bill which failed to reach this House in the following year. If a joint electricity authority is not to be able to supply the undertaker who hands over his station at as cheap a price as that at which he himself could have generated, the whole of the Act of 1919, and of this supplementary Bill if it becomes an Act, will be, to use the words of the noble Viscount on the Second Reading, perfectly useless and futile. I hope, therefore, that the noble Viscount, who is such a very firm believer in this proposed legislation, will be prepared to back his opinion by putting this clause on the face of the Bill.

The noble Viscount talked of timid people, but I sometimes think timidity may also be described as a very proper caution regarding a complicated piece of proposed legislation. At any rate, there are many people up and down the country who are afraid that, if the Government refuse to put into this Bill t heir own section, appearing in the measures of 1919 and 1920, this Bill is not going to mean cheap electricity, but dear electricity. I put this Amendment, therefore, as a test as to whether the Government believe that this Bill will produce the cheap and abundant supply of electricity which has always been promised us. I can at any rate say that, so far as recent inquiries go to show, undertakers make the strongest possible point of the fact that they would not consider for one moment handing over their stations or having anything to do with a joint electricity authority unless they were secured against having to pay more for their energy than the price at which they themselves could generate it.

These "super-stations" are not going to be constructed in one night, and if the joint electricity authorities are ever set up they will have to continue generating electricity in the stations of the original undertakers. Presumably they will not set up "super-stations" unless they find that it is an economy to do so. You may have the position that the joint electricity authority will actually be generating electricity, in stations taken over from the original undertakers, at a greater price than that at which the undertakers themselves generated it, and that may continue indefinitely, because obviously the authorities would not set up complete separate stations until they were satisfied that it was an economy to do so. I hope therefore, if only with the object of persuading us that the Bill has a chance of providing cheaper electricity, for which we all hope, that the Government will accept my new clause.

Amendment moved— After Clause 9, insert the said new clause.—(The Earl of Bessborough.)

VISCOUNT PEEL

My Lords, my noble friend Lord Bessborough admitted that the clause was not original. I am going to submit that it is not only not original, but is also superfluous. I will explain that in a moment, because this clause was omitted in your Lordships' House at the same time, I understand, as the compulsory clauses were omitted. It is very relevant to compulsory clauses, but it is not relevant to voluntary clauses.

THE EARL OF BESSBOROUGH

The Government put it into the Bill of 1920.

VISCOUNT PEEL

I said so, but it was dropped in your Lordships' House when von threw out also the compulsory clauses.

THE EARL OF BESSBOROUGH

The 1920 Bill never reached your Lordships' House.

VISCOUNT PEEL

I was talking of the 1919 Bill, and not of subsequent efforts made in legislation. Whether the clause was u the 1920 Bill or not I think it is perfectly clear that under this arrangement these stations arc only going to be taken over voluntarily. It is obvious that those who hand them over in this way can make what terms they like, and it is unnecessary to put in a lot of conditions which, while appropriate possibly to compulsory transfers, are not necessary and wholly inappropriate to voluntary transfers. Therefore I think the Amendment is unnecessary.

THE MARQUESS OF SALISBURY

I am sorry for the reply of the noble Viscount. There are two answers to it. One is that, he has not taken account of what we know to be indirect compulsion. That is to say, there is very great power in the new authorities, backed by the Electricity Commissioners, to force people to come in, because of the power to refuse expansion or any kind of licence to develop their business, which those Commissioners have under this Bill and the principal Act. That indirect compulsion may place the owner of a generating station in practically an impossible position. The second answer is that if he would insert this clause in the Bill lie would give some encouragement to the owners of generating stations to try to help him through with the working of his Bill. As my noble friend has pointed out, at present the joining of these electricity authorities would be looked upon with a great deal of suspicion by a great number of people, and if there is the least doubt as to whether they will receive their electricity at the same price as they can make it themselves, it will greatly militate against the working of the Bill.

The noble Viscount would, I think, do well not to give an absolute answer—at any rate on the present stage of the Bill. He always knows his subject, but he was not aware that this clause had appeared in the Bill of 1920. That was when all the voluntary clauses in the 1919 Act had passed away. It, too, was a purely voluntary Bill, and yet those responsible for the Ministry of Transport considered this clause necessary. I suggest to the noble Viscount that we should adjourn this matter and leave him to consider it, or that, if he so wish, the Amendment should be withdrawn on his undertaking not to close his mind to a reconsideration of the matter before Report.

VISCOUNT PEEL

Of course I respond to that appeal, and will consider the matter before Report. I am going to say two things only. The noble Marquess objected because, he said, the Commissioners could exercise the power of refusing to allow a particular authority to extend its undertaking, if it did not come to terms with the joint electricity authority. I think that unfairly states the position and attitude of the Commissioners. They are the friends, after all, of the authorities, and I cannot understand that there could be any more gross abuse of their powers than definitely to try to make use of them in order to force some particular authority to hand over its generating station to some other authority on particular terms. As to the appearance of this clause in the Bill of 1920, I do not know that it vitiates my argument, which is that a clause such as this is not very suitable in a Bill which is purely voluntary.

THE MARQUESS OF SALISBURY

As the noble Viscount promises to consider the matter we will not prolong the discussion.

VISCOUNT PEEL

I am reminded that the reason for the insertion of this clause in the Bill of 1920 was that the compulsory clauses were there also. This particular clause appeared as a corollary to them, and therefore the connection between this clause and compulsion is clear.

THE EARL OF BESSBOROUGH

All I can tell the noble Viscount is that the people concerned do not consider that the insertion of this clause is superfluous because there is a great deal of support for it. True, the Bill is meant to be voluntary, but it is not very popular. We have heard glorious accounts of what the joint electricity authorities are going to do, but I have had put in my hand a paper showing that a large number of authorities, including Birmingham, will not have the joint electricity authorities. I thought the Government wanted to bring them into the Bill, but if they will not put in such a clause as will encourage the undertakers to come in, be they municipalities or companies, I fail to see how the Bill is going to have any chance of success.

VISCOUNT PEEL

I have said I will consider the matter, and it shall be carefully gone into before the Report stage.

THE MARQUESS OF SALISBURY

I hope the noble Viscount will keep his mind open on this subject.

VISCOUNT PEEL

If the noble Earl desires he can put the clause down for a subsequent stage.

THE EARL OF BESSBOROUGH

I will not press the clause now, but will, as suggested, put it down later.

Amendment, by leave, withdrawn.

VISCOUNT PEEL

I am asked by my noble friend Lord Crawford to say that this Bill will be taken again to-morrow, and that, in order to conclude the Committee stage, it may be necessary that the House should sit after dinner.