§ Read 3a, with the Amendments.
§ Clause 26:
§ Amendment of section 64 of Act of 1908.
§ 26. Section 61 (Electrical fittings) of the Act of 1908 shall be read and have effect as if the word "sell" were inserted in sub-clause (1) of that section after the word "provide" where that word first occurs.
§ LORD BANBURY OF SOUTHAM moved to leave out Clause 26. The noble Lord said: My Lords, Clause 26 gives power to the Burnley Corporation to sell electrical fittings. The history of this power is as follows. Up to 1902 there were powers given to various corporations to supply and sell electrical fittings, but after that year, there being a strong feeling against encouraging municipal trading, no further powers were given to sell electrical fittings. Powers were given to supply electrical fittings on hire, because it was stated by the corporation that they were in a better position to let fittings on hire than private contractors, and that it would probably encourage the supply of electricity if they were allowed to let fittings on hire, but the purchase of fittings had to be made through a contractor.575
§ In 1912 this House adopted what is known as the House of Lords Model Clause, whereby any such sales or work required on consumers' premises have to be carried out through an electrical contractor. In 1919, by arrangement with the Electricity Commissioners and supply authorities, Section 23 of the Electricity Supply Act, 1919, was agreed to, which gave local authorities power to provide and let for hire, repair and maintain electrical fittings, but prohibited them from selling the same unless expressly authorised by their special Act or Order. This section was adopted by both Houses of Parliament as the model for local legislation and it took the place of the model clause of the Act of 1912. Under this Bill the Select Committee have practically turned down this clause and given power to the Burnley Corporation to sell electrical fittings. Last year a Select Committee of your Lordship's House deleted a similar clause in the Wakefield Corporation Bill, and if this clause is allowed to remain in this Bill the action of your Committee of last year will be reversed. I do not think it is to the advantage of the trade of the country, which cannot be said to be in a prosperous condition at the present moment, in one year to protect electrical contractors and then in the next year to allow them to be over-ridden by municipal corporations.
§ The Conservative Party, including, I think, the noble Marquess the Leader of the House, has always opposed to the utmost of its ability municipal trading, and as this is a case of municipal trading and not only that, but a reversal of the decision of your Lordships' House last year, I hope you will confirm the decision at which you arrived a year ago.
Page 19, lines 26 to 29, leave out Clause 26.—(Lord Banbury of Southam.)
§ LORD STRACHIE
My Lords, as the Chairman of the Committee which unanimously gave the power sought for in this Bill I hope your Lordships will allow me to give you some of our reasons for so doing. The Burnley Corporation, in fact, only ask for the same powers to be given to them as are given already to some eighty other local authorities. What is the position? I do not think Lord Banbury of Southam is quite correct as regards the model clause. He talked about 576 it as though it had been turned down by the Committee. The model clause, for all practical purposes, does not exist at the moment. I will tell you what the position is. The model clause came into effect in 1912 and remained in force until 1919. It gave power to the corporations to sell, hire and repair, but not to wire. Up to 1919 that was the state of the law. It was rather a curious position. What happened after that? An alteration was made, although I ought to say that under the model clause, while there was no power to wire, yet there was power allowing a corporation to call in a middle-man, a contractor, and he only had the power of carrying out the work of wiring premises.
We all know that the middleman is rather expensive if you cannot do any work direct. It is hard on the corporation. The corporation had to pay the bill sent in by the contractor and then recover the money from the occupier after the wiring had been done. It was found that the model clause was not workable, was not desirable, and, perhaps, there was also an idea that we should make progress in this matter. I know the noble Lord does not like progress, but in 1919 the Electricity Act gave power to let for hire, repair and maintain and supply motive power. There was no power to sell, except when so authorised by a special Act or Order. It is obvious from that that the model clause was not working well and power was therefore given by Act or Order under that Act in particular eases to sell and manufacture. In this case they are not asking for power to manufacture; they are only asking for power to sell.
Obviously the Act of 1919 went a little further than the model clause. It enables a Committee of your Lordships' House to give this power to sell to a corporation. I can imagine that there may be cases where municipalities are extravagant, do their work badly, where they are in debt, and power would not be given. It is right that there should be discretionary powers, but in this case the Committee was unanimous in considering that the Corporation of Burnley had carried out their electricity powers very well indeed. Their rates were low as compared with many other boroughs and they were conducting the work very efficiently. The Burnley Corporation also own their 577 own gas and water supply and it was shown that the municipality of Burnley consisted of good business men, capable of carrying on the work of the corporation and of being entrusted with further powers, such as the hiring and selling of electric wiring and fittings.
As regards gas and water Parliament has entrusted the municipalities in all these cases with absolute rights. There are no restrictions at all. The municipality often find it useful in the case of people who are not too will off, not only to have power to sell but to have power to sell on the deferred payment system. That is a common system throughout the country. Your Lordships' House have, indeed, gone a step further. In the case of Wakefield and Stoke-on-Trent you have allowed the corporations to hire the wire and fittings to the occupier of the house, and if there is a. change of occupier then the incoming occupier is allowed to buy the fittings and wiring. As a matter of fact, this power is not largely exercised. It is almost a dead letter, and there is no advantage to be gained from the cases of Wakefield and Stoke-on-Trent. This seems to me very desirable in the case of small houses. We all agree as regards the value of electricity. It is not merely a luxury, but in many cases a necessity, and there is no reason why members of the professional class, clerks and so on, as well as working men, should not enjoy the advantage of a supply. I have in my hand figures which show what is happening in the case of Burnley, where the approximate cost of wiring and fitting house of the rateable value of £15 a year is £12, while in the case of a house of the rateable value of £50 a year the cost is £60. A man might be very desirous of having electric light, but he might not be prepared to pay £60 down for it. On the other hand, if he is able to pay by means of deferred payments, he will do so if he desires the benefit of electric light.
Apart from the question of domestic lighting, I am informed that in many cases there is a great demand from people who want to have motive power. I am told that the cost of motors of one-half horse-power is from £9 to £13, and in the case of motors of ten horse-power the cost is from £32 to £40. Here, again, it seems very desirable that these small 578 men should have an opportunity of paying by means of deferred payments when they need motive power to carry on some small industry and cannot afford to pay a lump sum. As regards the question of small houses, I think that the evidence that was given in this connection with regard to Burnley was rather interesting. It was then stated that mains had been laid along certain roads upon which 3,369 houses abutted, but only 1,060 houses were connected with the mains. Many persons not so connected were anxious to be connected and to take a supply of electricity if the difficulty with regard to wiring and fittings could be removed. That, I think, is very natural.
In the case of Barrow I will quote certain figures which, though not actually connected with this Bill, are very interesting. Evidence was given that in Barrow, out of 10,000 houses of a rateable value of less than £16, only some two or three thousand were supplied with electricity. The owners of many of the houses that were not supplied were anxious to have a supply, but could not afford to wire their premises under existing conditions. It will be seen, therefore, that there is a real demand for electricity in working-class houses, even of the rateable value of £16, as is shown by the fact that out of 10,000 houses some two or three thousand have it already, and the same facilities are desired in a very large number. I am sure that your Lordships would do anything that you possibly could to increase the comfort of working, men living in Burnley or in any other large town.
I cannot help feeling in this connection that since, in tin case of gas and water undertakings, it has been thought by Parliament that there should be no restrictions, electricity, which is even more useful than gas in some cases, should be at least upon an equality with it, and there is no reason why exactly the same powers should not be given to corporations in this respect as they have in regard to gas and water. I know that this was, generally speaking, the feeling of my Committee. The expansion of electricity means a cheaper light and power and, in addition, the greater the supply of electricity the greater the demand for fittings, lamps and so on. This, in its turn, means that you get that increase in employment that we are all so anxious at the present 579 moment to facilitate in every possible way.
Let me say, since a reference has been made to municipal trading, that when I went on that Committee I was, if anything, opposed to anything of the kind, but although I was somewhat prejudiced in that respect it was my duty, as a member of the Committee, to put aside any feelings that I might have in that regard and to look upon the question in a judicial frame of mind. There was no kind of prejudice in this matter, and whatever feelings we may have had were not allowed to influence us. I hope that your Lordships will allow this Bill and the other two Bills to go forward in order to give a great boon for the inhabitants of these boroughs.
§ VISCOUNT HALDANE
My Lords, in addition to what my noble friend has said there are one or two other considerations which are material. In the first place, this is a power already possessed by a large number of municipal corporations; and in the second place, it is not a. question which raises the issue of municipal trading. The Government, as is well known, are favourable to affording the country a supply of electricity. If that is done it means putting at the disposal of the municipal authorities and of other bodies much of the control of electrical power. I know from the newspapers and from what has been stated that the proposals of the Government extend to three heads:—(1), the securing of sufficient generation of electricity; (2), the distribution of the electricity so generated all over the country; and (3), the putting of the local bodies, municipal corporations and other authorities in a position to make the power, which for the first time comes into their hands in an adequate form, available to the public within their area.
That being so, it obviously involves a great deal more than exists at the present time. It is all very fine to talk of private people. Private people, no doubt, will come in whenever there is anything that is very profitable. They will come in in the future just as in the past, and if they can supply more cheaply than the municipal authorities then they will get the market. If they cannot, then the public ought not to be deprived of the power which is proposed to be given merely be- 580 cause the private contractors cannot supply as cheaply as the municipal authority. If that is so, it seems to me that there is ample reason for supporting the decision of two Committees, one of which was a Committee of the other House which has investigated this matter and reported in favour of this Bill and the other a Committee of your Lordships' House which has also looked into it and reported in its favour.
This power has been given as regards gas and water fittings and, for the life of me, I cannot understand what metaphysical distinction the noble Lord opposite, who is not given to metaphysics, draws between electricity and gas and water. If we are really to have a, great advance of productive power in this country we require electricity, not only for domestic consumption but for the small manufacturers, and if the latter have it in a satisfactory fashion they must be able to buy from the local authorities which have been entrusted with the power of distribution of such fittings as are required to make this source of power effective. I cannot conceive that your Lordships would throw out a proposition which is not only in accordance with the necessities of the time but is in accordance, in principle, with the proposals which the Government have put before us. These, no doubt, will have to be discussed by Parliament next Session, but they are proposals which, at any rate up to now, have been welcomed with a good deal of public assent because they make for our greater efficiency as a nation and because they supply a, want which we are deeply feeling at this moment.
§ THE MARQUESS OF BATH
My Lords, although I have a good deal of sympathy, as I expect have a good many others, with the main principle on which my noble friend has founded his Amendment, I confess that I cannot myself ignore what I believe to be the unanimous recommendations and opinions of the Committee of Parliament to whom these three Bills—because I understand the same Amendment applies to all three—was referred. I only venture to occupy your atention for a few moments because I think there is an important point involved. Some mention has been made, both by my noble friend and by the noble Lord opposite, of a Bill that was before a Committee of this House last year and 581 which was amended by that Committee, of which I was one of file members. I only allude to it to say this, that I have since heard, quite informally, that the clause which we put in, or the Amendment which we made to that clause, has since proved to be quite unworkable.
The fact is, as the noble Lord, who I think was Chairman of the Committee, has stated, that the Act of 1919 entirely superseded the model clause. Before that, Committees had something on which to work. They have now the provisions of an Act which I trust I am not transgressing the rules of the House if I venture to suggest certainly bear more than one-interpretation. I only rise really for the purpose of expressing the earnest hope that a model clause or model clauses may be framed on the new Act. I am sure every member of the House who has served on Committees will agree with me that the model clauses are of inestimable value to us when, in Committee, we have to deal with points raised by learned Counsel who represent the parties. We have something to work on. At present we have only the somewhat doubtful clauses of an Act of Parliament, and I venture very humbly to make this suggestion. I hope also that those clauses may give some directions which will ensure the safety of the installations in these small houses.
THE EARL OF DONOUGHMORE
My Lords, my noble friend who has just sat down has, I think, dealt a little harshly with his own measure. He has alluded to a clause arrived at last year after a great deal of Parliamentary discussion and inserted in a Bill of last year dealing with this subject. My noble friend has described that clause as unworkable. I do not think it goes quite so far as that, but it certainly is not applicable to the difficulties as we now understand them, and for this reason these proposals come before your Lordships this afternoon. As my noble friend has mentioned, the same point arises in all three Bills and no doubt it will be in accordance with your Lordships' convenience that we should continue the discussion of the three Bills together on the one point.
Your Lordships have already realised from the debate that the point is one of considerable importance, and it is one that has an important Parliamentary 582 history. As Lord Strachie reminded us, in the early days seventy or eighty municipal authorities were given power to sell electric fittings. Then their opponents got active and there were proceedings in Paliament and in the Courts, with the result that the model clause of 1912 was drawn up—the model clause of your Lordships' House which forbade any sale of these fittings save through a contractor. The policy of your Lordships was then consistent. We insisted upon that model clause in the House and I insisted upon it very much more elsewhere in private interviews when considering proposals. There were a substantial number of applications during the period from 1912 to 1919 to depart from that model clause but, except in one very special case, I do not think we ever did depart from it.
But a new situation has been created by the Act of 1919, and we are all responsible for it. Lord Bath was rather diffident about criticising the Act of 1919. We have all been taught that fools sometimes rush in where angels fear to tread, and I am not going to hesitate to criticise as sharply as I can the Act of 1919. The clause was said to be the result of agreement, but there is complete disagreement as to what the clause means. It is Clause 23 and it enacts thata joint electricity authority and any local authority authorised by special Act or by Order to supply electricity may provide, let for hire and in respect thereof may connect, repair, maintain and remove (but shall not, unless expressly authorised to do so by the special Act or Order, manufacture or sell) electric lilies, fittings, apparatus and appliances …The electrical contractors construe that clause as meaning that all authorities who had obtained authority before 1919 to sell fittings should continue to sell them and no more should be authorised to sell them. On The other hand, the municipal authorities construe it to mean that they may not do so unless they are able to persuade Parliament in special cases to permit them to do so.
That, I think, is the attitude taken by the Ministry of Transport and the Electricity Commissioners, because I see that in the course of proceedings in another place a gentleman who represented the Ministry of Transport said the intention of the Ministry was merely to draw attention to the existing state of the law and to leave it to the Committee, 583 having heard the evidence, to decide whether the corporation in question should have extended powers or not. Hence come these applications. They came before me in the normal course, and my first instinct, I confess, was to insist that the practice of 1912 to 1919 should be maintained, but after some hesitation I thought it would not be unreasonable that further inquiry should take place. Therefore, these three Bills were referred to the Committee already mentioned.
May I say, in passing, that I am never nervous when I refer any subject to a Committee of this House because I have complete confidence in their decisions, but if ever I did feel hesitation this is one of the last Committees as to which I should feel hesitation. The Committee consisted of five members of this House, all energetic in assisting me in Committee matters, and three members have had great experience in the Chair on Committees. I have read the proceedings before the Committee from beginning to end and I entirely agree with their unanimous conclusion. Whilst I hope that my noble friend behind me will not force the matter to a Division, if he does I shall vote with the members of the Committees in favour of maintaining the Bill as now printed.
I am much struck by two facts in the proceedings which, to me, are new facts. First of all, there is the fact, already mentioned by Lord Strachie, that without some system of hire purchase or deferred payments, small value houses cannot get electric facilities as quickly as they should. The occupiers cannot afford the initial lump sum to instal, and this has undoubtedly delayed expansion in parts of England. It is quite true, I think, that contractors might have organised some system of hire purchase or deferred payments if they had wished to do so, but there is at any rate no evidence before us now that they have done so.
On the other hand, I am impressed with another fact which is also a new one to me. Parliament has allowed these authorities hitherto to hire out machines, but we are dealing with human nature and the evidence is that it often happens that somebody who has been hiring a machine comes to the authority from whom he is hiring it and says: "I am 584 quite satisfied with this machine. I do not want to hire it any longer; I would like to buy it from you." These municipal authorities who supply electricity cannot sell him that machine and your Lordships will see what will at once happen. The occupier says: "Take your machine back. I will hire it no longer. I will buy one from somebody else." Your Lordships will see the result on the electrical authority: they get left with these machines, which they cannot sell. They are what is familiarly known in the army as "half-worn" and, as such, are completely wasted from the owner's, that is to say the municipal authority's, point of view. That is an unbusinesslike proceeding and it is a second reason which makes me realise that the position has so altered that we are justified, I think, in allowing both Burnley and Barrow these powers, whatever may be the result in the future on general legislation.
Before I sit down I should like to express my anxiety on the greater point. You have now in the country, mainly, three systems under which the municipal authorities supply electricity. You have some with full power to sell fittings; you have some with no power to sell fittings; you still have some, of course, with the power to sell but solely through the contractor. All these three systems cannot each be the best possible system, and I suggest that the best possible system is the only one that we ought to contemplate in encouraging the expansion of the electrical industry in this country, which we know we are only just beginning to see. I would therefore make this appeal to the Government, without asking, of course, that I should receive an answer to-day. I would ask them to consider whether, this autumn or next year, some inquiry cannot be set up as was set up in 1912 to settle this matter once and for all. In 1912 it was a Joint Committee of the two Houses. I am, of course, indifferent as to what form the inquiry takes now.
My noble friend Lord Bath asks that a model clause should be drawn up. That is, of course, the ideal that I hope such an inquiry would have in view. Otherwise I can foresee endless Parliamentary fights. Every municipal authority which has not got these powers, encouraged by the Act of 1919, will come to Parliament and ask for these powers. We shall therefore have a great waste of Parliamentary time and 585 public money in settling a matter that ought to be settled once and for all. It was practically settled from 1912 to 1919. It is now unsettled and we are all to blame. I hope that we may all be given the opportunity of putting the position on a more businesslike and permanent basis which will be of value to the electrical industry throughout the country.
§ LORD BANBURY OF SOUTHAM
After the speech of the noble Earl it is evident that it would be useless to press this matter to a Division, but I will not withdraw; I prefer to have the Amendment negatived. May I say that this is only one instance of how foolish it is ever to give way on anything? Once you begin to give way you open the door and somebody comes in and says: "If you have done that, now you must do something else."
§ THE LORD PRIVY SEAL (THE MARQUESS OF SALISBURY)
My Lords, I have listened with the attention which is due to his great authority to the observations of the Lord Chairman and I will take care that his suggestion is transmitted to the proper quarters in the Government.
§ On Question, Amendment negatived.
§ Bill passed, and returned to the Commons.