HL Deb 11 April 1922 vol 50 cc149-82

Amendments reported (according to Order).

Clause 1:

Power of authorities to borrow.

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

THE EARL OF BESSBOROUGH moved, in subsection (1), to leave out "with the consent of" and insert "under an Order made by." The noble Earl said: My Lords, I move this Amendment to prepare the way for the second Amendment which I have upon the Paper, which seeks to provide— Where the amount to be borrowed by a joint electricity authority exceeds the sum of one hundred thousand pounds an Order made by the Electricity Commissioners under this section shall be provisional only and shall not have effect unless and until it has been confirmed by Parliament. If while a Bill confirming any Provisional Order under this section is pending in either House of Parliament a petition is presented against the Order the Bill, so far as it relates to that Order, shall be referred to a Select Committee, or if the two Houses of Parliament think fit so to order, to a Joint Committee of those Houses, and the petitioner shall be allowed to appear and oppose as in the case of Private Bills. That is the Amendment which I have in mind in moving this present Amendment. I think I am right in saying that during the previous discussions on this Bill, both on the Second Reading and in Committee, in principle the controversy, so far as there was controversy, was with regard to the protection of tie ratepayers and consequently the limiting of the power of the local authorities to lend. If I may be allowed to do so, I should like to say that in my humble opinion the Government met those of us interested in this matter in a very conciliatory and friendly spirit, for the noble Viscount not only accepted a number of Amendments during the Committee stage, but he has to-day on the Paper certain other Amendments, with the object of meeting objections made by your Lordships.

This afternoon I would like to draw attention to another very important feature of this Bill—namely, that part of it which allows the new joint electricity authorities, when they are set up, what I should describe as unlimited borrowing powers; unlimited, that is, except as to Departmental consent. I hope very much that the noble Viscount will meet this Amendment as he did those upon Clause 5. I venture to suggest to him that it would be hardly consistent on his part if he did not do so, because if he was so ready and willing to limit the lending powers of the local authorities, it would hardly be consistent if he did not also at the same time limit the borrowing powers of the joint electricity authorities when they come into being.

The first three clauses of the Bill propose to allow the joint authorities to borrow without coming to Parliament at all; that is to say, they are absolutely outside of the control of Parliament, and can borrow simply with the consent of Government Departments. With regard to the words of my Amendment, should like to say that I am not particularly wedded to the limit of £100,000. I dare say that is not enough—I do not know—and if a higher figure should be put in its place that is a matter that can easily be adjusted. The point I desire to make is this: Why are these joint electricity authorities to be put in an entirely different position from all the other joint authorities to which we are accustomed in this country? We are all familiar with such great joint boards as the Metropolitan Water Board, the Port of London Authority, and any number of joint boards—water boards, harbour boards and so on—up and down the country. I think I am correct in saying that there is not one of these joint boards which is allowed to borrow without Parliamentary control from time to time, so that it is rather difficult to understand why a very similar joint board or joint boards, which are going to be set up to deal with electrification, should be relieved from any control whatever by Parliament, when all these other joint boards have to come to the two Houses of Parliament.

I can imagine that the noble Viscount may say, in reply to this argument, that under the Electric Lighting Act of 1882 local authorities who set up electricity undertakings have power to-day to borrow with only Departmental consent. I do not suppose, however, that the noble Viscount will put forward that defence of these first three clauses very seriously, because, after all, no one can suggest that the electrical industry was in the same stage in 1882 as it is to-day. It was then only in its infancy and quite petty parochial undertakings were contemplated, and, by the way, only for lighting and not for power purposes. Therefore I do not suppose that that defence will be seriously made by the Government. It is hardly a matter of doubt now that if Parliament had foreseen the future development of this great industry this power would never have been allowed.

I would like to suggest the sort of sums of money which these joint electricity authorities are likely to want to borrow. I admit that it is difficult, certainly for a private member, to form any kind of accurate estimate, but there are examples of sums expended which give some kind of indication of the sums of money which these joint authorities are likely to require. Take, for example, the London and Home Counties district, covering London and a great part of the counties around London. According to figures which have been published, I think by the London County Council, we know that up to the end of 1919 the local authorities expended over £12,000,000, and the companies over £20,000,000, or something like £32,000,000 in this one area alone. When we recall that this London area is only one out of eighteen districts which it is proposed to set up, we can form some idea of the amount that will be required for the whole of the country. If you take London alone, you will find that, according to these figures, the London companies had expended £16,000,000 up to the end of 1919. They have certainly spent more than that up to 1922, and by the date of purchase by the London County Council in 1931 they will certainly have spent several millions more.

Those are figures relating only to the London and the Home Counties district. With regard to the country as a whole the only figures I shall refer to represent the capital expended, as shown in the Commissioners' Report of last year. These figures, let me say, apply only to generating stations, and leave out distribution. They show that the local authorities in London have spent £3,000,000 for generating alone, and the local authorities in the rest of the country, £26,000,000; while the companies in London have spent £6,000,000, and in the rest of Great Britain, £4,000,000. Therefore, on generation alone, no less than £40,000,000 has been spent. But that takes you a very small part of the way, because when these joint electricity authorities have taken over undertakings that is only the very beginning of their work. They have then to set up super-stations, and what will they cost? It is difficult to form an estimate, but I suppose it would not be extravagant to say that, in each one of the twenty districts which will eventually be formed if this Bill and the principal Act are successful, the expenditure will not be less than £2,500,000. That means a total of £45,000,000 or £50,000,000, which is, I think, a moderate estimate of the expenditure on the super-stations.

Therefore, I think that it is not going too far to say that, in ordinary circumstances, if these Acts are to operate with any success whatever it will mean the spending altogether of at least £100,000,000, and if the intention of the Act is carried further and purchase agreements are entered into that will mean another £50,000,000. Everyone will agree that these are rather staggering figures, and that, when these new authorities are going to undertake great experiments of this kind. even if the figures were much less formidable than these, we as legislators should desire that they should come to Parliament for sanction, just in the same way as joint boards are obliged to do already.

One wonders what justification the Government are going to offer for giving these tremendous powers. I dare say the noble Viscount will tell us that, as a matter of fact, the Electricity Commissioners already come to Parliament for sanction to borrow on behalf of local authorities who are setting up electrical undertakings. But local authorities are in a different position from that which these new authorities will occupy, because in the case of a local authority (and the noble Viscount, I think, will remember municipal experience in this connection, as I do), if the ratepayers do not like the amount which is being spent on a particular form of municipal undertaking, they remember it when the triennial election comes round, and the ratepayers are quite likely to take very strong action. Therefore, so far as local authorities are concerned, there is some control. But these joint authorities are not elective. Though it is true there are elected persons on them, they will have a great number of members who are not in any way elective. Moreover, they will not be supplying the ratepayers as ratepayers. The local authority has to deal with its own ratepayers, but these joint authorities will be dealing with a far wider range of people who, from the electoral point of view, have no control over them whatever. I submit that, if Parliament does not insist that these authorities should come to it for sanction when they desire to borrow, at any rate in the care of large sums, there will be no remedy at all as against them in the very dark and doubtful enterprise which I submit they are going to set up.

Amendment moved— Page 1, line 7, leave out ("with the consent of") and insert ("under an order made by").—(The Earl of Bessborough.)

THE SECRETARY OF STATE FOR INDIA (VISCOUNT PEEL)

My Lords, I am much obliged to my noble friend for saying I have done my best to meet him and his friends as regards some of his Amendments, but I was sorry that he drew from that the inference that I should therefore agree to other Amendments. I drew rather the contrary inference. But in the interesting statement that my noble friend has made I do not think he has really explained what the full effect of his own Amendment is. I thought he abstained, perhaps rather cautiously, from rutting before your Lordships the mechanism by which he proposes to control the borrowing of these joint electricity authorities. He was wise, because, if he had, I think your Lordships would have seen Low ill-adapted it was for the purpose for which he proposed it, or, rather, how its conditions were so stringent that it would make it extremely difficult to borrow at all. Perhaps that may have been the intention of the noble Earl, but, as I am anxious, on behalf of the Government, that these joint electricity authorities should work, I naturally object to a proposal which would destroy their capacity for working.

The Amendment refers to cases where the sum to be borrowed exceeds £100,000, but my noble friend would not even stand up to his own Amendment. I think he saw clearly that to say that they could not borrow more than £100,000 without coming to Parliament would be ludicrous, because you can hardly conceive any operation that they could carry out with less than that sum. Therefore, the noble Earl very wisely said he did not limit himself to that amount, but he did not state the amount to which he would limit himself. Your Lordships, in fact, may cut out the £100,000 altogether, because it is obvious that the intention, or, rather, the effect, of the Amendment is that these joint electricity authorities should not borrow at all. The joint electricity authorities would be bound hand and foot, and so would the Electricity Commissioners, and practically nothing at all could he done without going through the Caudine Forks of this procedure which is suggested by the noble Earl.

What is the procedure? First of all, all these matters are to be done by a Bill confirming Provisional Orders. Therefore, during the time within which Parliament is not sitting nothing can be done at all; all that time is lost for any operation of the joint electricity authority. Secondly, if either House objects, this matter has to be transferred to a Joint Committee of those Houses. So not only is objection taken, but we have to go through this long procedure of having all these matters thrashed out in detail. If £150,000 is to be borrowed by a joint electricity authority it is to be discussed with all the machinery of a Joint Committee, of lawyers appearing, and so on, and long discussions. I do not know whether this is part of the new Conservative policy which the noble Marquess advocated on Saturday last or not.

THE MARQUESS OF SALISBURY

It is the old Conservative policy.

VISCOUNT PEEL

I thought it was a new one. At any rate, it is a most delaying policy.

THE MARQUESS OF SALISBURY

It. is the policy which the noble Viscount has supported all his life.

VISCOUNT PEEL

I think the noble Marquess ought to have made that clear in his speech on Saturday. Anyhow, your. Lordships can easily conceive of the tremendous delay that can occur if these comparatively small sums are only to be borrowed by the joint electricity authority when permitted after all this very elaborate machinery has been set in motion. I think the noble Earl, Lord Bessborough, keen as he is on all public work, would be rather weary of sitting on Joint Committees in order to decide whether these small sums should be borrowed by these particular authorities.

The noble Earl thought that I should not make use of an argument in which he seemed to perceive a fallacy. But I do make use of it. Of course, at the present time, the whole of the control of the borrowings of local authorities is in the hands of the Electricity Commissioners, who can and do sanction very large loans for this purpose. It may be a good or a bad system, but it is the one which obtains. Yet the extraordinary thing is that when these local authorities unite together to hand over to themselves, we will say, one of their generating stations, or mains, or what not, this totally different procedure is to be followed. They can borrow large sums at the present moment; but if these same authorities join together in order to borrow money they cannot borrow more than £100,000 without going through all this extraordinarily elaborate procedure. The inconsistency of it is astonishing. There is no comparison, and I do not see how the noble Earl could make any fair comparison between the two systems.

Again, I must really complain of the noble Earl's figures. Amid the acclamations of the noble Marquess opposite, he piled figure on figure until he reached, I think, the magnificent total of £150,000,000 that was to be borrowed, I do not know when, but in the immediate future. As to all these points the noble Earl was very careful not to put the other side of the picture before us, because, as I have explained more than once during these discussions, if these borrowings are made by joint electricity authorities to take over power stations, and so on, there may be new debt incurred, but for the new debt old debt is cancelled. Therefore, when the noble Earl talks about £20,000,000 or £30,000,000, or whatever figure he may choose, to be borrowed in order to take over these generating stations, he has to remember that to the same extent debt is cancelled in the case of the local authorities to whom those stations belong. I do not think he is entitled, without putting that very definite consideration before the House, to talk about these sums as if they represented entirely new money. They are very largely replacement money, though they might be additional money where it was necessary to enlarge a generating station.

Therefore, I am certainly going to ask your Lordships to reject the Amendment, but I am also going to make a suggestion, which I trust your Lordships will accept. I think there is some objection to it because it certainly has a limiting effect; but if there is the feeling at the outset against the freedom which these joint electricity authorities may have of borrowing money subject only to the Electricity Commissioners and without coming to Parliament, I have made some attempt to meet it. It will be remembered that all these schemes set up by joint electricity authorities come before both Houses of Parliament, and then this House and another place can deal with them in such manner as is thought proper. I will read the words which I propose, subject to your Lordships' permission, to insert: (4) A scheme constituting a joint electricity authority shall fix with reference to the estimated capital expenditure of the authority the maximum amount which may be borrowed by the authority, and the authority shall not have power to borrow under this section sums in excess of the amount so specified, unless authorised so to do by a subsequent special Order: Provided that for the purposes of this subsection money borrowed for the purpose of paying off loans previously raised shall not be taken into account. As your Lordships will see, that is a considerable limitation of these general powers, because, I think, in the scheme which will come before your Lordships' House, and also before another place, a maximum amount will be stated (based, of course, on the immediate requirements of these new authorities) beyond which they may not borrow without a subsequent special Order.

That, I think, will do away with the rather elaborate machinery invented by the ingenious imagination of the noble Earl, and will not require Parliament or Joint Committees to sit on and inquire into every £200,000 or £300,000 to be borrowed by these joint electricity authorities. It will put a sort of upper limit on the amount which they may borrow. Of course, that will not do away with the powers of the Electricity Commissioners, who will have to sanction each loan within that amount, and it gives Parliament a general control, and a more than general control, because when those schemes come before both Houses of Parliament it will be possible for those desiring to do so to make alterations in the amount so sanctioned. I suggest to your Lordships that that proposal will meet any substantial fear that there may be—though I do not think there is really the slightest fear—of too large borrowing being permitted without coming to Parliament. I hope, therefore, that the noble Earl will agree to withdraw his Amendment, and in that case I would immediately move the Amendment I have read out if your Lordships so desire.

THE MARQUESS OF SALISBURY

My Lords, I admire the Parliamentary methods of the noble Viscount. He denounces the Amendment moved by the noble Earl, and has up his sleeve all the time a very substantial and a very gracious concession which he intends to offer towards the end of his speech. If he had begun with that he would have saved himself a good deal of trouble. As your Lordships will understand, it is rather difficult and rather inconvenient to be asked to pronounce an opinion upon an Amendment the terms of which we learn for the first time upon the last occasion when anything like a collected discussion of this subject can be carried out in your Lordships' House. It illustrates the extreme objection to the procedure under which we discuss these Bills. My noble friend has moved a very important Amendment, with great knowledge and great moderation, and be is answered by the noble Viscount with the proposal of an alternative Amendment of which we now hear for the first time and which we shall have no real opportunity of considering before we send it to another place.

I had intended to have said a word or two in answer to the earlier part of the noble Viscount's speech, the part in which he denounced any limitation on the powers of the Electricity Commissioners to sanction any number of millions proposed to be borrowed by a non-elective authority—

VISCOUNT PEEL

I do not think I did. I was defining their powers in regard to the local authorities.

THE MARQUESS OF SALISBURY

A great part of the joint electricity authority is non-representative, as the noble Viscount knows perfectly well. Does he deny that the joint electricity authorities are non-representative of the ratepayers?

VISCOUNT PEEL

I think the noble Marquess misunderstood me. I was dealing with the powers of the Electricity Commissioners, and was pointing out the powers that they had as regards the loans of local authorities. That was the main point with which I was dealing.

THE MARQUESS OF SALISBURY

It is not worth while discussing it, because the noble Viscount has made a concession, but the joint electricity authority is not a wholly representative body, and what this Bill, as it stands without amendment, seeks power to do is to give power to those authorities to borrow whatever sums the Electricity Commissioners may permit. I said that that was a novel, and I think a very objectionable, plan. Now the noble Viscount says, in effect: "I will give you a check. There shall be a maximum amount inserted in the schemes which are submitted to both Houses of Parliament." Will that apply to London as well as to other parts of the country?

VISCOUNT PEEL

London has its own system of borrowing, as the noble Marquess knows.

THE MARQUESS OF SALISBURY

I ask the noble Viscount whether there will be, in the case of London, some Parliamentary control over the sums of money the London joint electricity authority is to be allowed to borrow?

VISCOUNT PEEL

So far as the electricity authority is concerned, certainly.

THE MARQUESS OF SALISBURY

We need not be alarmed, therefore, lest London should be able to borrow any sums of money that it likes without the two Houses of Parliament sanctioning it. I understand we have that in the case of London, and, in respect of the rest of the country, we have the concession which the noble Viscount has just offered to your Lordships. I do not think that it would be of much use to discuss that concession at length, because it is very difficult to be certain exactly what are its terms. I understand that where it is merely a question of transferring the indebtedness from the local authority to the joint electricity authority no Parliamentary sanction will be required.

VISCOUNT PEEL

Whatever the joint electricity authority would have to borrow would come under the maximum amount in the scheme. I was only pointing out that as regards the general indebtedness of the country or the ratepayers—

THE MARQUESS OF SALISBURY

There are the closing words at the end of the Amendment.

VISCOUNT PEEL

Money borrowed for the purpose of paying off loans previously raised. That, the noble Marquess sees, is a totally different point. Supposing a joint electricity authority has borrowed £500,000 at rather a high price, and supposing it had a conversion scheme and borrowed another £500,000 merely for the purpose—and for no other purpose—of paying off the loan it has previously incurred, its indebtedness, of course, would be exactly the same.

THE MARQUESS OF SALISBURY

I was wrong, but the noble Viscount will forgive me, for I had only just heard it for the first time. I understood that what he meant was that where a debt was, as it were, transferred from one of the constituent local authorities to the joint electricity authority, in that case the sum would not be counted in the maximum for which Parliamentary sanction would be required.

VISCOUNT PEEL

The noble Marquess, I think, was putting together two separate arguments that I used. I was pointing out, in reply to the noble Earl, whose fancy roved over £150,000,000, that—putting aside these gigantic sums with which he deals so lightly—supposing £1,000,000 or £500,000 were borrowed for taking over a big generating station, that would be a generating station already belonging to a local authority, and if that generating station were taken over, and £500,000 were borrowed for the purpose of taking it over, pro tanto the debt of the local authority, who would be paid off, would be reduced. This proviso does not deal with that point, but merely says that where this joint electricity authority has borrowed when money is rather dear—say, 7 per cent.—and then, at a later stage, when money is cheaper in the market, if it chose to borrow at a cheaper rate in order to pay off this £500,000, you would not treat that as two loans of £500,000 each, but only as one loan of £500,000, because really there would be only one loan, as the second one would be made to pay off the first. That is the effect of the proviso. Supposing that they were allowed to borrow £500,000 only by the scheme which came before your Lordships' House, they would be able to borrow, without coming again to your Lordships for sanction, the second £500,000 to pay off the first £500,000.

There may be some doubt entertained on the point as regards London. London finance is regulated by particular Acts, but that does not apply to the joint electricity authority in London. The joint electricity authority of London comes under this provision just as much as a joint electricity authority anywhere else. All joint electricity authorities, whether in London or elsewhere, will be on the same basis.

THE MARQUESS OF SALISBURY

That certainly improves the concession from the point of view of your Lordships who, with us, have ventured to criticise some parts of this Bill. I am much obliged to the noble Viscount for having explained so clearly the effect of his Amendment, and I realise that it goes a good deal further than I was suggesting just now. I think there is only one course which we could suggest to your Lordships to take, and it is to accept this Amendment. It is a concession, though it is very difficult to be quite certain what it means, and we must not be taken to approve of the Amendment. All we can do is to accept it for what it is worth, presented, as it is, at the last moment, verbally and without any proper time for a thorough consideration.

There is one closing observation that I should like to make. The noble Viscount indulged in a certain amount of perfectly good-humoured ridicule regarding the figures which my noble friend, Lord Bessborough, gave to your Lordships. My noble friend suffers under great disabilities, because he has not access to official figures like the noble Viscount. I find myself in exactly the same difficulty, being quite unable to come to any definite conclusion as to what sums of money are involved. I am not sure whether I am misrepresenting the noble Viscount, but I do not think that from start to finish in the discussion upon this Bill the Government have given us any estimates of the sort of burden which the ratepayers may probably have to bear by the operation of this Bill.

I think Parliament ought to have such an estimate. We ought to have some idea of the amount for which we are, so to speak, letting the ratepayers in. That would only be in conformity with the practice of Parliament. By a Standing Order of the House of Commons no Bill throwing a burden upon the ratepayer or taxpayer is allowed to be introduced without some sort of an estimate being furnished, and I think we might ask the noble Viscount to give us, if he can, some idea of the sums of money he would substitute for the figures given by Lord Bessborough. It is really not quite fair to chaff my noble friend as to the size of his figures unless the noble Viscount is prepared to give alternative figures.

LORD MONK BRETTON

My Lords, I sincerely hope that the Amendment of the noble Viscount will induce the noble Earl to withdraw his. His proposal would make the Bill unworkable. It suggests that the joint authorities should have to go through the complicated procedure of coming to Parliament before they can borrow money. That would mean that the scheme would not function at all. It is a wrecking Amendment. Let me also say this to the noble Earl. It is difficult, in the face of the Amendments which the noble Earl has moved at various stages of this Bill, to think that he is speaking on behalf of the companies with whom the London County Council has, up to now, been in friendly negotiation. On behalf of the London County Council may I say that unless this Bill goes through in a form in which it can be really beneficial and effective the London County Council will have carefully to consider whether the London companies should be granted an extension of tenure. In the public interest the London County Council would have seriously to consider, when the time arrives, whether it should not exercise the powers of purchase which Parliament has given it. The noble Earl in moving his Amendment is, in their judgment, opposing this Bill and the principles for which it stands. It would have the effect, if persisted in, of making the Bill so much waste paper.

Let me say this to the noble Earl on my own behalf. On the Second Reading of the measure I reminded him of the selfsame rights of purchase which are exercisable in 1928, and that at the present time the London County Council is a body which should be more sympathetic to those principles which he has at heart than perhaps other county councils. We are now in the year 1922. The next election will take place in 1925, and the election after that in 1928; precisely the year when the Council will have to decide whether it will buy up the electricity undertakings of London or not. I appeal, therefore, to the noble Earl that it is in the interests of those he represents to make this not only the enabling Bill it is, but also a Bill which is agreeable to the local authorities as well as to the companies.

VISCOUNT PEEL

May I say one word in reply to the challenge of the noble Marquess about the charges which are to be laid on local authorities in consequence of proceedings taken under this Bill. He wanted me to give an estimate. My difficulty in giving any such estimate is this. If this Bill succeeds, if the principle on which it is founded is right—namely, that small stations are not economical for the production of electricity but that concentration of production in larger units is economical—it is perfectly clear the result must be that electricity in bulk will be generated far more cheaply than it is now and that the authorities will get their electricity at a cheaper rate than they do now. As a consequence of that, instead of there being a charge on the rates it will be exactly the other way. The whole Bill is based on that. If electricity is not going to be cheaper, then the Bill is a mistake and you might as well scrap the whole business. If the Bill is wrong, then all the best authorities on the production of electricity are wrong as well, and we should have to go back to the old system which has already been condemned.

THE MARQUESS OF SALISBURY

My noble friend, Lord Bessborough, estimated what he believed was the possible capital charge which might be laid on the ratepayers. That may be remunerative or not. The noble Viscount said his figures were fantastic. I suggest that the noble Viscount should say what figures are reasonable. We hope, as he says, that it will be remunerative. That is a matter of revenue; I want to know what capital charge will be thrown on the ratepayers.

VISCOUNT PEEL

The noble Marquess must surely understand that if it is remunerative there can be no charge on the ratepayers, because all these loans include sinking fund as well as interest. There is really nothing to answer. My reply was directed only to the figures. When he suggested that all these millions would have to be raised I pointed out that the bulk of that would be money raised by the joint electricity authorities, and against that you could set all the debts of the local authorities which would be paid off out of money they received from that raised by the joint electricity authorities. The point upon which ratepayers are anxious is not the amount of the capital expenditure but whether anything will fall on the rates. The whole idea of the production of electricity in bulk is that it will be much cheaper, and, therefore, these sums for interest and sinking fund will not fall on the ratepayer. I cannot give an estimate which is based on the negation of the whole Bill.

LORD LAMINGTON

May I point out that the same argument was used in the case of the water companies of London. I remember that in the Report which was issued it was stated that no central authority could supply water as cheaply as the companies who were interested in keeping down the cost of the supply.

LORD ASKWITH

Can the noble Viscount point to any clause in the Bill which guarantees cheapness? There is nothing in the measure about maximum charges. There is a good deal of guessing going on as to whether electricity is going to be cheaper. Many people think it will be dearer.

VISCOUNT PEEL

Comparison has been made between the production of water and the production of electricity. The two things are not comparable in the least. If you have a great generating station you can produce as many kilowatts of electricity as you like, but you cannot produce snore water than you can find. As regards the other question, there is, of course, no figure guaranteeing this in the Bill, hut the whole basis and structure of the Bill, and all the knowledge and experience upon which it is built, tend to point the way to the cheaper production of electricity by mass production. If that is not so, then the whole experience gathered by all the leading electricians of this and other countries goes for nothing and is absolutely wrong.

THE EARL OF BESSBOROUGH

In asking leave to withdraw my Amendment, I know that I am not entitled to say any more, but if I have your Lordships' permission I should like to thank the noble Viscount for the concession that he has made in meeting my Amendment, and to add that, as regards the speech of the noble Lord opposite, in so far as he referred to my Amendment, he was entirely misinformed. This is not in any sense put down as a wrecking Amendment. The manner in which the Government have received it is sufficient proof of that. The Amendment was put down with the intention of trying to protect the public, and was entirely in the public interest.

Amendment, by leave, withdrawn.

Amendment moved—

Clause 1, page 2, line 19, at end insert the following new subsection: (4) A scheme constituting a joint electricity authority shall fix with reference to the estimated capital expenditure of the authority the maximum amount which may be borrowed by the authority, and the authority shall not have power to borrow under this section sums in excess of the amount so specified, unless authorised so to do by a subsequent special Order. Provided that for the purpose of this subsection money borrowed for the purpose of paying off loans previously raised shall not be taken into account."—(Viscount Peel.)

On Question, Amendment agreed to.

Clause 5:

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

5.—(I) 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 having a population according to the last published census returns for the time being of not less than fifty thousand 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. (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 authorised 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 ease of the London County Council) without the consent of the Minister of Health:

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.

(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. 166
  3. (c) in the vase 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 shad not be reckoned as part of the total debt of thy council for the purpose of any limitation en 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.

(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.

VISCOUNT PEEL moved, in subsection (1), after "or" ["any county or borough or county district"], to insert "any." The noble Viscount said: The whole purpose of this Amendment is to meet a point raised by my noble friend, Lord Bearsted, to preserve the rights of the City.

Amendment moved— Page 3, line 36, after the first ("or") insert ("any").—(Viscount Peel.)

On Question, Amendment agreed to.

THE EARL OF BESSBOROUGH moved to omit paragraph (d) of subsection (1). The noble Earl said: I move this Amendment only for the purpose of asking the noble Viscount a question which I hope lie will be good enough to answer. The paragraph runs: (d) To give financial assistance in any other form to the joint electricity authority. You have already agreed that they are to lend any money to the joint electricity authority, to subscribe for any securities issued—

VISCOUNT PEEL

I do not want to interrupt the noble Earl, but these are, of course, only general words. I think the powers already given under the other clause are pretty wide. If the noble Earl presses it, I am prepared to give way, though I think there is no harm in leaving the words in. I have no strong feeling upon the matter.

THE MARQUESS OF SALISBURY

If the words are really not required, it is a pity to leave them in, but the noble Viscount is so conciliatory that we do not want to press him beyond a certain point.

VISCOUNT PEEL

I am inclined to think that the draftsman rather exhausted his ingenuity in discovering all the particular forms in which money could be lent, and there is really very little left; so that if the noble Earl presses his Amendment, I am quite willing to give way.

Amendment moved— Page 4, lines 8 and 9, leave out lines 8 and 9.—(The Earl of Bessborough.)

On Question, Amendment agreed to.

VISCOUNT PEEL moved, in subsection (2), after "The raising of money for the purpose of so lending or subscribing for securities shall be a purpose for which a council," to insert "being authorised undertakers may borrow under the Electricity (Supply) Acts, 1882 to 1919, and for which a council not being authorised undertakers." The noble Viscount said: The effect of this Amendment is to ensure that any borrowing by local authority undertakers under this clause is brought into the accounts. It is rather a technical matter, and I think your Lordships may safely agree to it.

Amendment moved— Page 4, line 40, after ("council") insert the said words.—(Viscount Peel.)

On Question, Amendment agreed to.

THE LORD CHAIRMAN

I understand that there are two Amendments which ought to be put in consequent on the Amendment moved by my noble friend, Lord Bessborough. The first, is, towards the end of subsection (2), to leave out "or in giving such other financial assistance as aforesaid"; the other Amendment will come later.

Amendment moved— Page 5, line 8, leave out ("or in giving such other financial assistance as aforesaid").—(The Earl of Bessborough.)

On Question, Amendment agreed to.

VISCOUNT PEEL moved, in subsection (2), after "carrying of the said Acts into execution respectively," to insert "and in the case of a council of a county shall, if the Minister of Health so directs, be treated as expenses for special county purposes charged on the part of the county within the district of the joint electricity authority." The noble Viscount said: I put this Amendment down to meet a point made by my noble friend, Lord Oranmore and Browne, as to a difficulty concerning the special rates to be charged in these cases.

Amendment moved— Page 5, line 10, at end insert the said words.— (Viscount Peel.)

On Question, Amendment agreed to.

THE EARL OF BESSBOROUGH moved, in subsection (2), after "Section twenty-one of the Electric Lighting Act, 1909, shall apply to money borrowed by a council," to insert "being authorised undertakers." The noble Earl said: I do not know whether the noble Viscount will be able to accept this Amendment. As I understand it, the particular subsection says that money advanced to the joint electricity authority shall be disregarded in calculating the authority's limit of borrowing. It would seem reasonable that this should be done in the case of a local authority which is an authorised undertaker, but I do not see that it is right to extend it to county councils and other authorities who are not authorised undertakers, and so save them from coming to Parliament when they reach their limit of borrowing.

Amendment moved— Page 5, line 12, after ("council") insert ("being authorised undertakers").—(The Earl of Bessborough.)

VISCOUNT PEEL

This is rather a technical matter, but I think the Amendment which has just been carried by your Lordships makes the Amendment unnecessary as regards authorised undertakers. The paragraph ought to apply to councils other than authorised undertakers, because any debt thus incurred does not involve any charge on the rates. Supposing they have lent money and so on, it would be not a debt but an investment, and the loan charges would, of course, be paid by the local authority. I think it is clear that you could not put that sort of loan on the same basis as regular rate services. The application would be entirely different, and I think, therefore, the Amendment of the noble Earl is unnecessary.

THE MARQUESS OF SALISBURY

The noble Viscount has been so very conciliatory that I do not know whether it would be fair to press the Amendment upon him, but I must utter one word of protest against his view that all these undertakings will be safe investments for the local authorities. If the form of investment had been limited to debentures that might have been so, but under this Bill the county councils are to be allowed to take ordinary shares in these undertakings. As a matter of fact it is very difficult to make money out of these electrical undertakings. The margin is very small indeed, and even in the hands of private enterprise I believe it to be a fact that the highest rate of interest earned is 8 per cent., and very often it happens that nothing at all is earned. It is by no means true that this will necessarily be' a very profitable investment.

I am, of course, aware of the point that will be made by the noble Viscount, that consolidation results in economies, which will make these undertakings profitable, but I do not think he will find that even the largest enterprises have paid very well. In those circumstances, as the Bill permits county councils to invest not merely in debentures but also in ordinary shares, I think there ought to be sonic limit such as my noble friend seeks to impose—namely, that their borrowings in this respect should not be outside the ordinary limit of their borrowing powers. At the same time, if the noble Viscount really resisted, I should not suggest to my noble friend that he ought to press his Amendment, because there should be give-and-take in these matters, and the, noble Viscount has been very conciliatory.

THE EARL OF BESSBOROUGH

I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Amendment moved— Page 5, lines 25 and 26, to leave out ("or giving such other financial assistance").—(Viscount Peel.)

On Question, Amendment agreed to.

VISCOUNT PEEL moved to omit all words in subsection (4) after "administrative expenses of the authority." The noble Viscount said: I move this in pursuance of an undertaking I gave during a previous stage that we would deal in another way with temporary deficiencies, and leave this clause merely to deal with administrative difficulties.

Amendment moved— Page 5, lines 32 to 36, leave out from ("authority") to end of subsection (4).—(Viscount Peel.)

On Question, Amendment agreed to.

Clause 7:

Expenses of Electricity Commissioners.

7.—(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 he 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 Commissioners 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 had on the Paper a series of Amendments to Clause 7. The noble Viscount said: I shall move these Amendments in a slightly different, form from that in which they stand in the Marshalled List, and I have handed a copy of the altered Amendments to the Lord Chairman. The object of these Amendments is simply to put the generating stations throughout the country on the same basis as regards charges made by the Electricity Commissioners. I moved a somewhat similar Amendment on an earlier stage and the noble Viscount in charge of the, Bill asked me to put down my Amendment on the Report stage.

Amendments moved—

Page 6, lines 40 and 41, leave out ("and any subsequent apportionment under that section").

Page 7, lines 2 and 3, leave out ("next preceding that for which such apportionment is made") and insert ("nineteen hundred and twenty-one").

Page 7, line 4, leave out ("obtains") and insert ("obtained").

Page 7, line 8, at end insert: ("Any apportionment under the said section twenty-nine subsequent to the financial year current at the passing of this Act shall (notwithstanding anything to the contrary in the principal Act) be made in accordance with the number of units of electricity sold 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 the apportionment is made. The expression 'units of electricity sold' means all units generated or purchased by an authorised undertaker less (a) those used in the generating station or lost in transmission or distribution, and (b) those sold in bulk to authorised undertakers").

Page 7, line 11, leave out ("generated or obtained") and insert ("sold").

Page 7, line 11, after ("them") insert ("and of units sold in bulk to authorised undertakers")

Page 7, line 12, leave out ("thirty-first") and insert ("first").

Page 7, line 13, leave out ("January") and insert ("March").—(Viscount Falmouth.)

VISCOUNT PEEL

I accept all the Amendments.

On Question, Amendments agreed to.

THE EARL OF BESSBOROUGH moved, after Clause 12, 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 station 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: This proposed new clause and another were put down by me on the Committee stage, when I ventured to trouble your Lordships with some arguments on the subject, and the noble Viscount, at the beginning of his speech, responded to my appeal and said he would consider the matter before Report. I have, therefore, put these new clauses down again.

Amendment moved— After Clause 12, insert the said new clause.—(The Earl of Bessborough.)

VISCOUNT PEEL

I did respond to the noble Earl's appeal, and I have considered this matter very carefully. I am afraid that, after reconsideration, I came generally to the first conclusion at which I arrived. I stated then, I think, that all these suggestions and clauses and limitations of the noble Earl, however appropriate they might be to compulsory clauses, were quite unnecessary in dealing with voluntary transactions. Indeed, I am advised that there might be some danger in putting them in because they might place certain obligations on the purchasers, which might defeat the very object with which they were put in namely, of giving a cheaper supply. I hope the noble Earl will be content to leave that to the different authorities who are dealing with the joint electricity authorities. They are perfectly free to bargain and to ask for any conditions to be inserted. I hope the noble Earl will not seek to hamper these authorities or these transactions by insisting upon a number of limitations.

THE EARL OF BESSBOROUGH

I am very sorry that the noble Viscount is not prepared to back his opinion as a supporter and advocate of this measure, which is all that I am really asking him to do in this new clause, but the noble Viscount has met me over what I consider to be very substantial Amendments throughout the Bill, and I shall not press this new clause.

Amendment, by leave, withdrawn.

THE EARL OF BESSBOROUGH moved, after Clause 12, to insert the following new clause— . In any case where a generating station containing distributing plant becomes transferred to or is acquired by a joint electricity authority, the joint electricity authority shall provide such sub-station and plant as may be required by the previous owners of the generating station, to enable them to continue their distribution business its heretofore, and until such sub-station and plant shall have been so provided, shall permit such previous owners to use the distributing plant in such generating station in as full and complete a manner as if such generating station had not been so transferred.

The noble Earl said: This stands in the same position as the last Amendment. The noble Viscount promised to consider it before Report. I hope he will be able to accept the Amendment: I think it will be for the assistance of the working of the Act.

Amendment moved— After Clause 12, insert the said new clause.—(The Earl of Bessborough.)

VISCOUNT PEEL

I had hoped the noble Earl was not going to move this Amendment, because it stands on the same basis as the last, and exactly the same argument is applicable to it. I think it is far better to leave these transactions quite free.

THE EARL OF BESSBOROUGH

I will not press the Amendment.

Amendment, by leave, withdrawn.

THE EARL OF BESSBOROUGH moved, after Clause 13, to insert the following new clause: . The joint electricity authority and any authorised undertakers whose area is wholly or partly within the district of such authority may enter into and carry out agreements with any proprietors id any railway, tramway, dock, canal or navigation to whom t he authority or such undertakers are authorised to afford a supply of electricity in respect of the transfer or supply to such proprietors of any electrical apparatus or machinery by the authority or such undertakers, and the exercise by such proprietors of any rights of the authority or such undertakers in relation to any electrical apparatus or machinery so transferred.

The noble Earl said: I put down this new clause on the Committee stage, and the noble Viscount said he would consider it. He rather suggested that it was covered by Section 23 of the principal Act, but, as I understand, Section 23 of the principal Act simply gives power to the joint electricity authorities to hire out apparatus. That is not the point in this particular clause, which was moved by Lord Oranmore and Browne.

Amendment moved— After Clause 13, insert the said new clause.—(The Earl of Bessboroagh.)

VISCOUNT PEEL

The point made by Lord Oranmore and Browne when he was moving this Amendment at a previous stage was that it might apply to mains in streets, and questions of that kind. On that point I am advised that it is really a matter for Private Bill rather than for general legislation, and, for technical reasons, this would not be the proper place to introduce it.

THE EARL OF BESSBOROUGH

I will not press it.

Amendment, by leave, withdrawn.

LORD MONK BRETTON moved, after Clause 13, to insert the following new clause:— . Where under the powers of this Act in connection with any transfer or lease of an undertaking or part of an undertaking to a joint electricity authority the Electricity Commissioners suspend any powers of purchase relating to any such undertaking, or any part thereof, belonging to or leased to a company they may make provision as to the relation between the prices which may he charged for electricity and the dividends to be paid by such company.

The noble Lord said: This is an Amendment for the imposition of a sliding scale for the benefit of the consumer. On the Committee stage I moved the Amendment, but I moved it in a different place, and the noble and learned Lord, Lord Parmoor, took exception to the position that it occupied in the Bill. The noble Viscount in charge of the Bill, I understood, accepted the Amendment then.

Amendment moved— After Clause 13, insert the said new clause.—(Lord Monk Bretton.)

VISCOUNT PEEL

I agree to the Amendment.

On Question, Amendment agreed to.

THE LORD CHAIRMAN

My Lords, the noble Viscount, Lord Falmouth, has on the Paper a new Clause after Clause 13. Instead of that he desires to amend Clause 13. Strictly speaking, we have passed that clause. I think I am to blame; I did not notice. But perhaps your Lordships would allow us to take the Amendment now.

Several NOBLE LORDS

Agreed.

Clause 13:

Suspension of certain powers of transfer of lease of undertaking.

13. In connection with any transfer or any lease to a joint electricity authority of any part of any undertaking of any authorised undertakers the Electricity Commissioners may by Order suspend as regards any undertaking or part of an undertaking of such undertakers any powers of a joint electricity authority or the London County Council or any local authority relating to the purchase of any such undertaking or any part thereof for such period as the Electricity Commissioners may think fit, provided that consent to such suspension has been previously obtained from the authority or authorities in whom the said powers are vested and may for that purpose amend the provisions of any Act or Order relating to any such undertaking.

VISCOUNT FALMOUTH

The object of the Amendments which I have to move is simply to expand the powers conveyed in Clause 13 of the Bill, so as to enable the suspension of the power of taking over some undertaking by local authorities to take place without the necessity of a joint electricity authority being set up by the Electricity Commissioners. I beg to move.

Amendments moved—

Page 9, lines 9 to 11, leave out ("In connection with any transfer or any lease to a joint electricity authority of any part of any undertaking of any authorised undertakers")

Page 9, line 12, leave out ("Order") and insert ("an Order constituting a joint electricity authority or a special Order")

Page 9, line 13, leave out ("such") and insert ("any authorised")

Page 9, line 16, leave out ("any") in both places.

Page 9, line 17, after ("period") insert ("and on such conditions (if any)")

Page 9, line 22, leave out ("any").—(Viscount Falmouth.)

On Question, Amendments agreed to.

Clause 16:

Limitation On prices charged.

16. The prices charged for electricity by a joint electricity authority shall be so fixed by the authority, subject to such directions as may be given by the Electricity Commissioners, that, over a term of years to be approved by the Electricity Commissioners, their receipts on income account 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.

VISCOUNT PEEL moved, at the end of Clause 16, to insert the following new subsection: (2) 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 of the joint electricity authority who take a supply of electricity from the joint electricity authority in proportion to the number of units of electricity supplied to them in that year. Provided that in any case in which it appears to the joint electricity authority that the deficiency in any 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 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 noble Viscount said: This subsection is moved in consequence of a pledge I gave to deal in separate manner with deficiencies. The main point is that any deficiency will only be divided among those members of the joint electricity authority who take a supply from the joint electricity authority, and who will pay in accordance with the number of units of electricity supplied to them. Thus, those who do not take a supply will not he charged. And it does not seem unfair that the deficiency should fall on those who take the electricity, because they have got it pro tanto cheaper than they otherwise would have got it.

Amendment moved— Page 11, line 11, at end insert the said new subsection.—(Viscount Peel.)

On Question, Amendment agreed to.

LORD ASKWITH had on the Paper an Amendment, after Clause 16, to insert the following new clause:— . Section 16 of the principal Act shall be read and have effect as though the words 'or any other Act or Order confirmed by or having the force of an Act of Parliament' had been inserted therein after the words 'this Act' wherever they occur in the said section and as if the words 'Electricity Commissioners' had been inserted therein in lieu of the words 'Minister of Labour.'

The noble Lord said: The proposed new clause falls into two parts as it stands on the Paper. The first is to allow officers to have compensation in cases which do not fall under Section 16 of the Act of 1919, and the other is to allow the Electricity Commissioners instead of a referee appointed by the Ministry of Labour, to decide the amount of the compensation. The noble Viscount has suggested to me a form of words which seems to cover the first part of the proposed clause, and I should be glad to accept it.

With regard to the second part, there has been no time to circulate the Government Departments upon it, and to ascertain the position of the Ministry of Labour. I hope that in another place some account may be taken of it, and that instead of the Minister of Labour coming into this Bill, authority will be given to the Electricity Commissioners to decide the amount of compensation without, perhaps, upsetting their calculations in other matters by ha wing to refer this question to a referee whose decisions might be contrary to their desires, and also very uncertain in their incidence. I, therefore, ask leave to withdraw the proposed new clause as it appears on the Paper and to accept that suggested by the noble Viscount.

Amendment moved—

Insert the following new clause:— Section sixteen of the principal Act shall have effect as if for the words 'under this Act' there were substituted the words under or in consequence of this Act,' and as if for the words 'in consequence of this Act' there were substituted the words 'in consequence of any such transfer scheme agreement or arrangements.' Provided that any question as to whether a transfer scheme agreement or arrangement, not made under the principal Act, was in consequence of that Act, shall be determined by the Electricity Commissioners."—(Lord Askwith.)

VISCOUNT PEEL

I agree with the clause as moved in that form. I will also discuss the point raised by my noble friend with the Parliamentary Secretary, before the Bill reaches another place.

On Question, Amendment agreed to.

Clause 18:

Amendment of section 15 of Act of 1909.

18. Section fifteen of the Electric Lighting Act, 1909 (which relates to the supply of electricity to premises having a separate supply), shall have effect as if the expression "premises having a separate supply" included premises having a separate supply of electricity or a separate supply of gas, steam, or other form of energy applicable for the purposes for which electricity is demanded or received.

VISCOUNT PEEL moved, after the first "or," to insert "on which." The noble Viscount said: This Amendment is moved in pursuance of a promise given to my noble friend, Lord Newton. The effect of the Amendment is to extend the provisions of Section 15 of the Act of 1909, which relates to a stand-by supply, so as to apply those provisions to the case of the premises of a consumer or prospective consumer on which there is a separate installation of gas, steam, or other form of energy either in use or ready for use.

Amendment moved— Page 12, line 22, after the first ("or") insert ("on which").—(Viscount Peel.)

On Question, Amendment agreed to.

VISCOUNT PEEL

The next Amendment is consequential.

Amendment moved— Page 12, line 23, leave out ("applicable") and insert ("is in use or ready for use").—(Viscount Peel.)

On Question. Amendment agreed to.

Clause 19:

Power of persons not being undertakers to supply electricity.

19.—(1) Notwithstanding anything to the contrary contained in any special Act or order, it shall be lawful for the owners or lessees of any railway generating station, or of any generating station erected under statutory authority for the purpose of working tramways or light railways, to supply electricity therefrom upon such terms and conditions as may be agreed—

  1. (a) to a joint electricity authority; or
  2. (b) with the consent of a joint electricity authority to an authorised undertaker whose area of supply is situate within the district of such joint electricity authority; or
  3. (c) to an authorised undertaker whose undertaking is not in the district of a joint electricity authority; or
  4. (d) to any consumer, subject, in the case of premises situate within the area of supply of an authorised undertaker, to the consent of I hat undertaker:

Provided that no such supply shall be given under the powers conferred by this section—

  1. (i) without the consent of the Electricity Commissioners, nor otherwise than subject to such conditions as they may impose;
  2. (ii) to any authorised distributors whose undertaking is in the area of a power company without the consent of that company;
  3. (iii) to any premises within the district of a joint electricity authority and not within the area of any other authorised undertakers without the consent of that authority.

Provided also that nothing contained in this section shall limit or derogate from any powers already conferred on or exercisable by any owners or lessees of any railway generating station, or apply to any agreement already or hereafter entered into in pursuance of any such powers.

(2) The Electricity Commissioners may, subject to the provisions of the Electricity (Supply) Acts, 1882 to 1919, and of the Electric Lighting (Clauses) Act, 1899, by order authorise the breaking up of such roads, railways, and tramways as may be necessary for the purpose of such a supply.

VISCOUNT PEEL moved, at the beginning of paragraph (b) of subsection (1), to leave out "with the, consent of a joint electricity authority." The noble Viscount said: Your Lordships may remember that there was some discussion on this point and a suggestion that there was an element of compulsion lurking somewhere in these words. As I want to sweep away any element of compulsion I propose to omit these words, and I am supported in that by my noble friend, the Earl of Bessborough.

Amendment moved— Page 12, line 33, leave out ("with the consent of a joint electricity authority").—(Viscount Peel.)

THE EARL OF BESSBOROUGH

My Lords, I am obliged to the noble Viscount for having made that Amendment, and also for that which he moved in Clause 16.

On Question, Amendment agreed to.

VISCOUNT PEEL moved, in subsection (1), to leave out all words in paragraph (b) after "undertaker" and the whole of paragraph (c). The noble Viscount said: This Amendment is consequential on that immediately preceding it.

Amendment moved— Page 12, lines 34 to 39, leave out from ("undertaker") in line 34 to ("or") in line 39.—(Viscount Peel.)

On Question, Amendment agreed to.

THE EARL OF BESSBOROUGH moved, in subsection (1), immediately before the second proviso, to insert:— (iv) within or for use within the area of supply of any authorised undertakers without the consent of such authorised undertakers. The noble Earl said: My Lords, I hope that the noble Viscount will be able to accept this Amendment. As the clause stands it would appear that a railway or a tramway generating station could give supplies, presumably at a satisfactory price, to one of two undertakers supplying the same area, and refuse to give it to the other undertaker, which would obviously be a cause of injustice. As the noble Viscount realises, there are many cases of competing undertakers in the same area, and the words I propose would prevent any inequality as between rivals.

Amendment moved— Page 13, line 12, at end insert the said words.— (The Earl of Bessborough.)

VISCOUNT PEEL

My Lords, I think the words suggested by the noble Earl are really unnecessary. As to the supply to premises, he will see that is covered by subsection (1) (d) of this clause, which says: To any consumer, subject, in the case of premises situate within the area of supply of an authorised undertaker, to the consent of that undertaker." If it is intended to supply railways, tramways or canals situated partly within and partly without one undertaker's area, the matter is subject to the provisions of Section 5 of the Electric Lighting Act, 1909, under which a supply for haulage or traction can be given with the consent of the Ministry of Transport. Such consent cannot be given without going through the rather elaborate machinery of advertisements and so on, and opportunities are given to those affected to make their objections. A supply to railways, tramways or canals for purposes other than haulage or traction is subject to the provisions of a special Order, and that Order is subject to confirmation by the Ministry of Transport and an affirmative Resolution of the Houses of Parliament. Therefore, I think the machinery is already amply sufficient to cover the points raised by the noble Earl.

THE EARL OF BESSBOROUGH

If the noble Viscount thinks the Amendment is not necessary, I will not press it.

Amendment, by leave, withdrawn.

VISCOUNT PEEL moved, at the end of the clause, to insert the following new subsection: (3) The provisions of the Electricity (Supply) Acts, 1882 to 1919, and of the Schedule to the Electric Lighting (Clauses) Act, 1899, so far as they relate to the protection of the Postmaster-General, shall apply to any works for the supply of electricity under this section, and in the application of those provisions, the owners mentioned in subsection (1) of this section shall be deemed to be the undertakers, and nothing in this section shall affect any right or remedy of the Postmaster-General under the Telegraph Acts, 1863 to 1921. The noble Viscount said: I move this subsection merely for the protection of the Post Office. It has been agreed with the Post Office authorities and the Postmaster-General.

Amendment moved— Page 13, line 23, at end insert the sail new subsection.—(Viscount Peel.)

On Question, Amendment agreed to.

VISCOUNT PEEL

As your Lordships have shown yourselves, if I may be allowed to say so, so conciliatory in accepting various Amendments that I had placed on the Paper, it would not, perhaps be trenching on your generosity if I now moved that the Bill be read a third time.

THE MARQUESS OF SALISBURY

My Lords, so far as I am concerned, and speaking I believe for my friends, we have no objection at all to the course the Government propose. At the same time, speaking as a noble Lord who is interested in the Bill, I would suggest that the Government should postpone the Third Reading until to-morrow, for this reason and this reason only. A good many Amendments have been made this afternoon and some of them have been modified at the last moment, so that there will he certain little drafting points to be dealt with. For the credit of your Lordships' House, I think this Bill should he sent to another place in as good a form as possible. Therefore, if it were postponed until to, morrow the draftsman would have another opportunity of looking at it. I shall not desire to say a single word when the Third Reading is moved to-morrow as these are only drafting points. Having offered that respectful advice to the Government have nothing more to say.

VISCOUNT PEEL

If the noble Marquess thinks it is a matter of the credit of your Lordships' House, I will not press the Motion, which can stand over until tomorrow.

THE LORD SPEAKER

I understand that the noble Viscount does not press his Motion for the Third Reading now. May I say, however that I hope no Amendment will be moved on the Third Reading to-morrow without Notice.

THE MARQUESS OE SALISBURY

Not without Notice.