ELECTRICITY (SUPPLY) BILL.

HL Deb 07 December 1926 vol 65 cc1198-282

Amendments reported (according to Order).

Clause 1:

Constitution of Central Electricity Board.

(3) The chairman of the Board and any member of the Board who is, by the terms of his appointment, required to devote the whole of his time to the performance of his duties under this Act shall, within three months after his appointment, sell any securities which he may hold for his own benefit in any company carrying on the business of supplying electricity or the manufacture or sale of machinery or plant for the generation or transmission of electricity; and it shall not be lawful for the chairman or any such member of the Board whilst he holds office to purchase for his own benefit any securities in any such company, and if the chairman or any such member of the Board under any will or succession becomes entitled for his own benefit to any securities in any such company, he shall sell them within three months after he has so became entitled thereto.

(5) The Board shall be a body corporate with power to hold land without licence in mortmain.

VISCOUNT PEEL moved, in subsection (3), to leave out "which he may hold for his own benefit" and insert "in which he may be beneficially interested." The noble Viscount said: My Lords, the object of this Amendment is to extend the duty under the clause as regards securities held by nominees.

Amendment moved— Page 1, lines 25 and 26, leave out ("which he may hold for his own benefit") and insert ("in which he may be beneficially interested")—(Viscount Peel.)

VISCOUNT BERTIE OF THAME

I am obliged to the noble Viscount.

On Question, Amendment agreed to.

VISCOUNT BERTIE OF THAME had on the Paper an Amendment to move, in subsection (3) after "own" ["purchase for his own benefit"] to insert "or another's." The noble Viscount said: My Lords, I like the phraseology of the noble Viscount in charge of the Bill so much better than my own that I am going to ask him to let me steal his phraseology either at this stage or a later stage and adapt it to the second part of the subsection.

VISCOUNT PEEL

The noble Viscount does not move his Amendment?

VISCOUNT BERTIE OF THAME

Not till the Third Reading.

VISCOUNT PEEL

Do not let us have too many Amendments on the Third Reading.

VISCOUNT PEEL moved to add to subsection (5):— and shall have power to regulate their own procedure: Provided that the quorum of the Board shall not be less than one-third of the full number of the Board The noble Viscount said: My Lords, this Amendment is to fulfil an undertaking I gave during the Committee stage. The object is to give the Board power to regulate its own procedure, and the proviso is put in because the necessity of providing for a quorum was very much pressed upon me by noble Lords on this side of the House.

Amendment moved— Page 2, line 19, after ("mortmain") insert the said words—(Viscount Peel.)

LORD MONTAGU OF BEAULIEU

I am much obliged to the noble Viscount, but will he tell us what one, third of eight is?

VISCOUNT PEEL

One third of eight is three.

LORD MONTAGU OF BEAULIEU

The noble Viscount's arithmetic is not quite the same as that which I was taught at school. But if he means that there are never to be less than three as a quorum I am quite willing to accept the proposal.

LORD WITTENHAM

Why cannot you say "not less than three" instead of one third of eight, which is an impossibility.

On Question, Amendment agreed to.

VISCOUNT BERTIE OF THAME moved to insert the following new subsections: ( ) A person shall be disqualified for being chairman, vice-chairman or other member of the Board if he is convicted, either on indictment or summarily, of any crime, and sentenced to imprisonment with hard labour without the option of a fine, or to any greater punishment, or is adjudged bankrupt, or makes a composition or arrangement with his creditors. ( ) If the chairman, vice-chairman or any other member of the Board is absent from the meetings of the Board for more than six months consecutively, except for some reason approved by the Minister, he shall on the expiration of those months, vacate his office. ( ) Where the chairman, vice-chairman or other member of the Board becomes disqualified for holding office, or vacates his office from absence or otherwise, the Minister shall forthwith declare the office to be vacant, and shall notify the fact in such manner as he thinks fit, and thereupon the office shall become vacant.

The noble Viscount said: My Lords, this, I think, will get over an oversight on the part of the Government. It is usual to have this sort of clause in, and in fact I am rather disappointed that the noble Viscount in charge of the Bill has not seen his way to do what he promised on the last occasion—namely, to get rid of people who wilfully disobey the order to get rid of their shares. I do not know whether the noble Viscount will be able to move an Amendment of that sort on the Third Reading. If not, I will put one down.

Amendment moved— Page 3, line 9, at end insert the said new subsections—(Viscount Bertie of Thame.)

VISCOUNT PEEL

My Lords, my feeling about this Amendment is that it is hardly necessary with a Board of this quality to suggest that they must leave it if they are convicted, or go to prison, or are adjudged bankrupts, because, after all, the Board is selected from men of the highest standing both in character and in business. I wonder whether the noble Viscount does not think it would be sufficient if he moved the last two paragraphs, with one or two little alterations. I can hardly conceive of a member of this Board who had been put into prison for three months calmly coming back and taking his place on the Board. I would suggest that in the second subsection on the Paper, in order to cover the first subsection which I propose should be omitted, the words should be inserted after the word "Minister"—"or fails to comply with the foregoing provisions of the section." That is to say, if for any reason a member should turn obstinate and should not get rid of his shares then he cannot sit any longer. That seems to be a fair provision. Even a man of eminence might possibly become obstinate, but I do not think he is likely to become a criminal. If the noble Viscount is willing to leave out the first of his proposed subsections I would accept the second and third with the Amendment I have suggested.

VISCOUNT BERTIE OF THAME

I am much obliged. I simply took the Port of London Authority Act, 1908, and copied the phraseology from that. In that case there is a provision covering the case of imprisonment. If the noble Viscount thinks these people are so superior to the people on the Port of London Authority I am quite ready to withdraw that.

VISCOUNT PEEL

I have not heard of any member of the Port of London Authority going to prison.

VISCOUNT BERTIE OF THAME

No, but this provision is in the Act in case they do.

LORD CARSON

May I ask whether, if a member of this Board becomes a bankrupt, he will still be entitled to sit?

VISCOUNT PEEL

Is it necessary to provide for every case that might happen? I could give a great many other possibilities. A member of the Board might conceivably become a lunatic. Does the noble and learned Lord think it necessary to provide for every case of that kind? Of course, if he does not come to the Board meetings then, by the second subsection, he resigns his position.

LORD BANBURY OF SOUTHAM

But a lunatic could not very well come to the Board, could he? He would probably be locked up. A bankrupt, however, might come. It might be his only means of living; he might even sleep there.

VISCOUNT PEEL

Everything is possible, but is it conceivable on a Board of this kind that a man who goes bankrupt would really seek to attend meetings of the Board?

THE LORD CHANCELLOR (VISCOUNT CAVE)

My Lords, I suggest that the two latter of the proposed subsections overlap one another, and, if it would meet the views of the noble Viscount, I suggest that he move only the third subsection, with an addition of certain words from the second, so that it would then read:— Where the chairman, or other member of the Board becomes disqualified for holding office or is absent from the meetings of the Board for more than six months consecutively, except for some reason approved by the Minister, the Minister shall forthwith declare the office to be vacant, and shall notify the fact in such manner as he thinks fit, and thereupon the office shall become vacant.

VISCOUNT BERTIE OF THAME

I am much obliged to the noble Viscount.

Original Amendment, by leave, withdrawn.

VISCOUNT PEEL

Would the noble and learned Viscount on the Woolsack add the words "of Transport" after "Minister"?

THE LORD CHANCELLOR

Certainly. Then the Amendment moved is: Where the chairman or other member of the Board becomes disqualified for holding office or is absent from the meetings of the Board for more than six months consecutively, except for some reason approved by the Minister of Transport, the Minister of Transport shall forthwith declare the office to be vacant, and shall notify the fact in such manner as he thinks fit, and thereupon the office shall become vacant.

Amendment moved— Page 3, line 9, at end insert the said new subsection—(Viscount Bertie of Thame.)

On Question, Amendment agreed to.

Clause 4:

Preparation and carrying out of scheme.

4.—(1) The Electricity Commissioners shall, as soon as practicable, prepare and transmit to the Board a scheme or schemes relating to the respective areas specified therein—

LORD MONTAGU OF BEAULIEU moved, after paragraph (b) of subsection (1), to insert as a new paragraph: (c) Determining the places at which transformers for reducing pressure and secondary lines shall be placed by the Board as part of the main transmission lines, and the pressure at which electricity shall be supplied by the Board from such transformers and secondary lines.

The noble Lord said: My Lords, as on the Committee stage, I ask the House again to consider the question of the supply of cheap current to country districts. That such a supply is desirable is, I think, common ground between the Government and its critics; but the Government say that it is the business of the undertakers and not of the Board, and they have no doubt whatever that the undertakers will supply the electricity because they will find it profitable to do so. That is the sole point—will it be profitable to any existing electricity company to supply current in sparsely populated districts, villages and small towns? All the knowledge I have of matters electrical, whether in connection with the generation of current or its transmission, leads me to think that these smaller areas will never be profitably supplied with current unless power is given to the Board to assist in the erection of transforming stations and thus to enable a secondary line to be put along the main trunk line to carry current of a less potential than the high pressure line is capable of supplying.

Members of the Government go up and down the country giving rosy accounts of what will happen when the Bill becomes law and suggesting that every labourer before long will have electric light in his cottage. Such a thing would be highly desirable; indeed, it is particularly desirable that there should be cheap power for use by all bigger farmers and small industrial plants. As your Lordships know, there is nothing more praiseworthy than the increase that has taken place under the auspices of various associations and individuals in village industries, and it is clear that if cheap electricity were available to help these industries and farming operations it would be a great benefit to the countryside. But scientifically and economically there is not the least chance of cheap electric current in these country and small industrial districts unless the burden is laid upon the Electricity Commissioners and the Board of building transforming stations and, having done that, of supplying current from the station to the local distributors.

Under the Bill at present there is the duty of taking the current from the big "grid" line, and the moment that current leaves the big "grid" line it is the duty of the local undertakers to turn it into current of less pressure for use in the district. As many of your Lordships know, that is done in France, Switzerland, Italy and other places. I believe I mentioned during the Committee Stage of the Bill that it is nearly always done in this way—that where big lines carrying high-pressure current run through a department, or whatever the political or civil district may be, it is a condition of the line being allowed to go through the district that facilities should be given for cheap current. We shall not get cheap current in this country if it is not provided in this Bill that the expense of erecting the transforming stations must fall upon the Commissioners and the Board.

Several remarks have been made tending to show that one of the excuses for borrowing from, or guaranteeing £33,000,000 by, the Treasury is that the poorer districts shall be able to have a share in the distribution of cheaper electricity. When I brought forward a similar Amendment during the Committee stage the noble Viscount said that though he had great sympathy with the demand in the country districts for cheap electricity, it was the business of the local undertakers and not of the Board or Commissioners to supply it. I was strengthened in placing that Amendment on the Paper by the fact that at page 18 of the Weir Report, after dealing with certain other things, the Committee say: Where these new Supply Companies cover wide areas, they will be responsible not only for actual distribution, but also for regional transmission. Where their activities are confined to a limited area, as will probably be the case in the purely non-industrial regions, the Board should be empowered to lay down secondary lines connecting their system to the 'gridiron.' This will at once provide the nucleus of a regional transmission system, and open up the possibilities of development in further directions. That is exactly what I desire to see carried out, but it cannot possibly happen unless there is in this Bill a mandatory clause or permissive clause—I should prefer a mandatory clause—at any rate a clause providing that the Board and the Commissioners together are empowered, when the demand arises, to supply cheap power and to put up the transforming stations themselves.

I have in mind a transmission station in France, on a tributary of the Rhone. It is a bigger station, of course, than is usually put up. I visited that station a year or two ago and it cost, I think, no less than £20,000. I do not say that such a station for a, country town of 6,000 or 7,000 inhabitants should cost as much as that; but I cannot conceive of a transforming apparatus being put up for less than £10,000 Five per cent. on £10,000 is £500 a year; in other words, £500 a year has to be paid in interest by the consumers in a small town in addition to any charge they may have to pay for the current. In these days when such wonderfully cheap small sets for generating electricity can be bought, there is not much chance of a small town getting the whole of its electricity consumers to combine to put up a transforming station unless it is made cheaper for them to do so.

I think that the Government should decide definitely one way or the other. If they say it is too expensive to supply these country districts, do not let us have any more high falutin' talk about supplying the countryside with cheap current and the great benefit that would be to the farmers and small industries in the country. It is a somewhat expensive thing to transform a very small quantity of current, especially when you have to bring it down not in one step but in two steps from the high pressure current. If the Government really and sincerely desire that the countryside should have the benefit of cheap current, I know that the noble Viscount will not contradict me when I say that there is nothing in the Bill to compel either the Commissioners or the Board to supply it.

What will happen will be this. A small town or district will say: "We want this cheap current," and the supply company will apply to the Board. The Commissioners of the Board will say: "You can have this current, but you must build yourselves a station to transform it." Your Lordships know that the supply company do not build stations. I may remark in passing that £33,000,000 is a considerable sum if it is all to be spent for the benefit of the larger towns, but I do not for a moment begrudge any thing that will be spent if it has the effect of cheapening current. It is, however rather hard on the country districts whose taxpayers are going to provide some of the security for the money which is lent that they should have no benefit whatever from the expenditure of the money. I think the Government should have said definitely that either they were willing or were not willing to make this a part of the scheme. On paper it is possible, but it is improbable. I desire that the Government should make it clear on the Third Reading of this Bill, or in another place when the Bill goes back there.

Colonel Moore-Brabazon, the Parliamentary Secretary of the Ministry of Transport, who knows a great deal about electricity and whose explanations on all stages of the Bill are well worth reading, rather threw cold water on the idea of the country districts getting anything. He said: The only thing we have said from the beginning is that in that interconnection which will now take place there will be lines running from one town to another which would not have existed before and in those districts where the lines run it will be possible to tap off the current at a very low rate for the benefit of that particular part of the country. It will be interesting to see what type of consumption goes on in these new areas. There it was definitely foreshadowed that the supply to country districts of cheap current will take place. The noble Viscount on the Front Bench, Viscount Peel, himself on Second Reading said: Again, the existence of the "grid" ….will make it possible to carry supplies through parts of the country where at present no distribution system exists and thus afford a welcome opportunity for the development of rural industrial areas. That is quite clear. The noble Viscount, like myself, desires to encourage these rural industrial areas. I understand that in this country only 400 farms, or .8 per cent., have a supply of electricity whereas in Germany no fewer than 90 per cent. of the farms are supplied.

My point, however, is not that; it is, that the noble Viscount held out in his Second Reading speech a distinct hope to all of us that he would make this a benefit to country districts. My Amendment is to the effect that transformers shall be placed by the Board as part of the main transmission lines; in other words, that the burden of the expense of making these transformers should be put on the Board and not upon the undertakers. I have no idea of raising any frivolous point. I think this is a most important matter. It is really a question of whether the rural districts are to get any reasonable supply and I hope the noble Viscount, who may not be able to meet me to-day, will, before the Bill reaches its final stage, go into the matter still further and see if he cannot meet us on this point. I beg to move.

Amendment moved— Page 4, line 25, at end insert the said new paragraph—(Lord Montagu of Beaulieu.)

VISCOUNT PEEL

My Lords, I dare say it was my fault and not the fault of the noble Lord but he has apparently misunderstood, or I misstated, exactly the point of this Bill as regards these transforming stations. He quoted me as saying that this matter of setting up the transforming stations was purely a matter for the distributors. I do not recollect saying it but I may, of course, be wrong. What I intended to say and what I believe I did say was that this was a matter for arrangement between the Board and the distributors. I am quite sure I did not say that it was for the distributors necessarily to put up these transforming stations. The whole business is a matter for arrangement. The various undertakers say that they want a supply of electricity to a rural district. Then it will be the duty of the Board to discuss with them where the lines are to be laid and for the Board to arrange where the transforming station will be set up. I do not think I did suggest, and I never intended to suggest, that the whole burden shall be thrown on the distributor. Transforming stations are paid for in the same way as the other operations of the Board are paid for, by the charges they make on the sale of electricity.

LORD MONTAGU OF BEAULIEU

I wondered whether it was the Board or the Commissioners or the local distributor that had to pay for it.

VISCOUNT PEEL

Of course, in the first place, the Board pay for it and then the question of the way it is spread out after they have paid for it will be a matter for the Board to consider, as in the case of their other charges. I again say that I do not disagree with my noble friend about the benefit or necessity of having electricity supplied to rural districts, and I repeat that that is one of the results which I hope we shall have from the Bill. Perhaps I have dispossessed him, or, at any rate, your Lordships, of the idea that it is the distributors who have to pay in all these cases for the transforming stations.

What the noble Lord wants, I understand, is this. He wants a scheme to determine the places at which secondary lines should be placed by the Board as part of the main transmission lines and the pressure at which electricity shall be supplied by the Board from such transformers and secondary lines. I submit that we ought not to put that into the Bill, because it would be very difficult, I might almost say impossible, to carry it out. The question of the different points at which transformers should be set up for the purpose of carrying electricity to the different villages is a matter for arrangement between the Board and the distributing authorities. It is not something that you can put in the first place into the scheme. It is a matter, when the scheme is arranged, that can be discussed between the Board and these distributing authorities.

There is ambiguity in the words "transmission lines". It is necessary to look back to the Act of 1919 and see in Section 36 what "transmission lines" mean. "Transmission lines" there includes transformers; therefore there is no need to put the word "transformers" into this Bill, because transformers are already included in transmission lines. When the scheme is drawn up and is published it is open for any person to come forward and urge that this or that special provision should be made in it, but I hope your Lordships will not urge me to introduce into this Bill something to determine, at the early stage when the scheme is made by the Commissioners, exactly at what points these transformers shall be put on the transmission lines. I submit that to do so would really hamper the action of the Board in dealing with the matter and hamper also the distributing authorities.

LORD MONTAGU OF BEAULIEU

Do I understand then that the word "supplied" means supplied as it leaves the transformer?

VISCOUNT PEEL

What words are you referring to?

LORD MONTAGU OF BEAULIEU

The last words in my Amendment. I want to get it clear for the benefit of the House and myself. Will the current as sold to the distributor be current as it comes from the "grid" line or as it leaves the transformer?

VISCOUNT PEEL

I assume it will be current after it has left the transformer. Arrangements as to stepping down will of course be made after discussion with the authorised undertakers.

VISCOUNT HALDANE

My Lords, I rise for as short a time as possible because time is precious and if we have long speeches we shall not get through our work. I entirely agree with the attitude of the noble Viscount in charge of the Bill. It must be realised, and the noble Lord who has moved the Amendment must realise, that this scheme has to grow. We cannot establish it all at once. You cannot put upon the Electricity Board obligations of which you cannot foresee the character. Once we have got generating stations, once we have got transmission lines, once we have got frequency conversion then we have a basis on which everything will be arranged according to the demand of the local authority. You will put in transforming centres where you think proper, but you cannot foresee them nor is it desirable that you should try to. These things may present a different aspect a year hence from that which they now have. I am therefore in favour of the attitude which the noble Viscount has adopted in reply to the noble Lord's Amendment which would require I do not know what liability to be put upon the Board and the Treasury. It would be an enormous addition to the cost and I do not myself care to incur that cost without knowing more about it.

LORD STRACHIE

My Lords, I am sure all of us who are interested in agriculture would approve of the Amendment moved by Lord Montagu of Beaulieu. One cannot help feeling disappointed that two noble Viscounts, one on each side of the House, seem to think it is well to wait to see what will turn up. Agriculturists are always being put off and being told that they will get something later on. I am surprised that the noble Viscount in charge of the Bill takes the line he has taken because we have always been told that although agriculture could not expect Protection and other things the Government would do all they could by side means to assist agriculture. This is an opportunity when something might be done, as Lord Montagu of Beaulieu has pointed out, to assist agriculturists and to help to improve village life. The noble Viscount in charge of the Bill said this must be a matter for consideration between the transmitters and the Board. I am afraid that if this is not put into the scheme as suggested by the noble Lord opposite it is very likely to be lost sight of. If the scheme does well in the towns the unfortunate people in rural areas may get something thirty or forty years hence.

I expect other noble Lords have had experience like myself of having large unsightly steel poles put up upon which current is taken at great voltage across one's land, interfering very often with cultivation of the land, and we have had no advantage at all. In fact I myself, when giving assent to the erection of such poles, suggested that it might be possible to get some of the current distributed over the estate, but I was at once told by the transmitters that it would be much too expensive and that they had no idea of doing it. Apparently the noble Viscount is perfectly ready to leave us in that condition for the next ten or twenty years.

LORD FORRES

My Lords, I think the noble Lord who has just spoken misconceives the purpose of the Bill. The purpose of the Bill is not to take electricity to any person who wants it at a low price. If someone in a remote district wanted electricity the price asked for it might render the proposition impossible. The fact is you have to leave it to the Board and to the distributing authorities to settle who is to pay for the transformer, for the simple reason that it depends entirely on the amount of current you wish to buy. If the amount of current which a local authority wishes to buy is so large as to make it very good business for the Board, the Board might reasonably say: "Very well, the price is so and so, and we will pay for the transformer." But if the population is small and the quantity of electricity intended to be bought is small the Board then would naturally say: "If we have to supply you you ought to pay for the transformer. It is not going to be profitable business." In such a case if the Board had to pay the cost of the transformer the cost would have to be spread over the rest of the district and industrial areas would have to pay for a supply for rural areas. It is unjustifiable to tie the hands of the Board. You must leave it as a business matter to be dealt with on business lines. Those are the only lines on which the Bill can be made a success.

LORD MONTAGU OF BEAULIEU

My Lords, I ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 5:

Existing selected stations.

5—(1) The Board shall make arrangements with the owners of existing generating stations which by virtue of a scheme are to be become selected stations for the stations being operated in accordance with the provisions of this Act, and for such extensions and alterations thereof as may be required by the scheme, and for such additional extensions and alterations as the Board, with the approval of the Electricity Commissioners, may from time to time direct:

(2) If the owners of any such station are unwilling to enter into or fail to carry out any such arrangements to the satisfaction of the Board, the Minister of Transport may by order empower any authorised undertakers or other company or person approved by the Board, or, failing such authorised undertakers company or person, the Board, to acquire the generating station at a price to be determined in accordance with the provisions of the First Schedule to this Act, but where the generating station is situate in an electricity district for which a joint electricity authority has been constituted that authority shall be given first opportunity to acquire the station, and on payment or tender of such price the Minister of Transport may make an Order vesting the generating station in the authorised undertakers, company or person, or the Board:

VISCOUNT PEEL moved, in subsection (1), after "scheme," to omit the words "are to." The noble Viscount said: My Lords, this is only a drafting Amendment.

Amendment moved— Page 6, line 35, leave out ("are to")—(Viscount Peel.)

On Question, Amendment agreed to.

LORD GAINFORD moved, in subsection (2), after "constituted," to insert "or in the area of supply of a power company." The noble Lord said: My Lords, the Amendment which I now move is somewhat different from the one which was moved at the Committee stage. It will be within the recollection of your Lordships that it was proposed in the Committee stage to omit certain words which appeared in the Bill between lines 18 and 22 which were inserted at the instance of a Labour representative in another place. The insertion of those words did a real injustice to the power companies. I think I can show your Lordships that the four Amendments that stand on the Paper in my name—they are consequential one on the other—are necessary in order to place the power companies in their proper position. The effect of the words inserted in the clause in another place is to give a joint electrical authority the first option of acquiring any selected station in the district of that joint electrical authority, but under the Act of 1922 it was made quite apparent that in a joint electrical authority's area any power company within that area could erect stations and carry out its obligations and the joint electrical authority could not carry out any operations in the area of a power company without the qualified consent of the power company. If the selected station were in the portion of the district of a joint electricity authority which comprises the area of a power company, it seems to me that it would be unreasonable, and I believe that in many cases it would be unworkable, to allow the joint electricity authority to acquire the station.

Under the Bill in its present form the Minister would be prevented from transferring the station to the power company, even though they were willing to operate it and even though the Central Electricity Board itself might consider it to be better in the interests of consumers of electricity generally that the station should be operated by the power company and not by the joint electricity authority. Accordingly I suggest these words in order to remove what would obviously be an unreasonable condition imposed upon the power companies, and a condition that might in some cases be unworkable.

Amendment moved— Page 7, line 20, after ("constituted") insert ("or in the area of supply of a power company")—(Lord Gainford.)

VISCOUNT PEEL

My Lords, the Bill, as the noble Lord has stated, gives the first option to the joint electricity authority. I submit, first of all, that the joint electricity authority is the only proper body to which this first option could be given, because it represents the authorities in that large district, speaks for them and controls electricity in that region. Accordingly I think that, from a business point of view, it would be the first authority to which an option should be offered. As I understand the Amendment of the noble Lord, he wishes to give the first option also to the power company in the area of that power company. I do not quite see how that scheme would be workable. The area of a joint electricity authority is very much larger than the area of a power company, and there may be one or more power companies within the area, so that you would have the difficulty that, when you were dealing with a generating station, you would have to give the first option both to the joint electricity authority and to the power company. I fail to see how you can give the first option to two separate people, and I urge the noble Lord to withdraw his Amendment. It would really bring business into inextricable confusion in the areas where there are joint electricity authorities. The number of such areas is increasing, and probably where they do not exist now they will be set up after this Bill has come into operation. I hope that the noble Lord will not complicate the Bill by presenting such a difficult problem.

LORD GAINFORD

My Lords, I admit that this is a complicated question, but it does seem to me to be quite fair that, where you have a body willing to do the necessary work in its own area, it should be permitted to do so; and I am quite sure that there will be cases where it may be expedient, even in the opinion of the Central Electricity Board, that this work should be left to the power company.

VISCOUNT PEEL

It can be so left. All that the clause says is that the first option should be given to the joint electricity authority. If the joint electricity authority do not want to accept this option they need not do so.

LORD GAINFORD

Do I understand that it would then ipso facto devolve upon the power company in its own area to carry out these obligations?

VISCOUNT PEEL

Not ipso facto, but, the first option having fallen out, of course the option could be offered to somebody else.

LORD GAINFORD

I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 6:

New selected stations.

6.—(1) The Board may make arrangements with any authorised undertakers in whose area of supply, or in the neighbourhood of whose area of supply, any new generating station required by a scheme is to be situated, for the provision of such station, but where such area of supply is situate in an electricity district for which a joint electricity authority has been constituted, the Board shall first endeavour to enter into arrangements with the authority for the provision of such station.

LORD ORANMORE AND BROWNE moved to omit from subsection (1) all words after "station," where that word secondly occurs. The noble Lord said: My Lords, this Amendment stood in my name on the Committee stage of the Bill and I withdrew it under a misapprehension because similar Amendments stood in the names of the noble Viscount, Lord Falmouth, and, I think, of the noble Lord, Lord Banbury of Southam, with reference to the preceding clause which the noble Viscount in charge of the Bill found himself unable to accept. It therefore appeared to me at the time that it was not worth while troubling your Lordships to divide on that Amendment, and I withdrew it. Since then, however, I have gone into the matter and I find that the circumstances relating to Clause 6 are quite different from those which decided my noble friend to oppose the exclusion of certain words on Clause 5.

Clause 5 refers to cases where the Board has selected a station and has required that station to undergo certain alteration, and where the undertakers have not felt themselves ready to do the work. In that case it is said that the Board shall give the preference to the joint electricity authority, rather than to any other body, to carry out such work. My noble friend knows that I have not such an affection for the joint electricity authority as he has, but I can see that in that special case there may be a good deal to be said for his contention. But in Clause 6 the matter is quite different. This deals with new generating stations and, in that connection, it does seem to me to be a pity that the Board should be hampered in their proceedings by being obliged, whether they like it or not, to go first of all to the joint electricity authority. It is quite possible that they may be the proper people to go to, but on the other hand it may be thought that a power company would be better for carrying out these requirements. I hope that the noble Viscount will see his way to agree to this Amendment, and to give the Board those full powers which we feel that they should have in regard to this matter.

Amendment moved— Page 8, line 11, leave out from ("station") to the end of subsection (1).—(Lord Oranmore and Browne.)

VISCOUNT PEEL

My Lords, I am very glad to see that my noble friend is anxious to give even larger powers to the Board than it has at present, but I really do not see why he should accuse me of having this passion for joint electricity authorities that he seems to attribute to me. I was only combating his extreme dislike and my feelings are rather in the middle way with regard to them. But I agree with the noble Lord that, as regards Clauses 5 and 6, there is a marked distinction which he has very clearly pointed out, and, if he really presses his Amendment very strongly, I am content, I will not say to accept it, but to let it go to another place, if he is willing, and to take its chance of surviving.

LORD ORANMORE AND BROWNE

I am much obliged to the noble Viscount and am glad to accept the proposal that he has made.

On Question, Amendment agreed to.

LORD ASKWITH had given Notice to move to insert the following proviso in subsection (1):— Provided that where a new generating station is required in the area of supply of a company which is a London Company within the meaning of the London and Home Counties Electricity District Order, 1925, such company shall have the first option of providing such station. The noble Lord said: My Lords, I ask leave not to move this Amendment, because it is of no importance if the Amendment of Lord Oranmore and Browne is taken in another place. I prefer the noble Lord's Amendment to my own.

Clause 10:

Obligation of Board to supply electricity to authorised undertakers.

10.—(1) As soon as the Board, as respects, any area or part of an area, notify that they are in a position to supply electricity, the Board shall, subject to the provisions of this Act, be under an obligation to supply either directly or indirectly to any authorised undertakers in that area or part thereof demanding such a supply such an amount of electricity as they require for their undertaking at a price ascertained in accordance, with the provisions of this Act:

Provided that, subject to the provisions of this Act relating to the rights of owners, of selected stations, the Board shall not—

1. (a) supply electricity directly to authorised undertakers situated in the area of supply of a power company without the consent of the power company unless the undertakers have an absolute right of veto on any right of the power company to supply electricity within the area of supply of those undertakers or any part thereof; or unless the power company are unable or unwilling to supply electricity to such authorised undertakers on reasonable terms and conditions to be determined in case of dispute by the Electricity Commissioners;
2. (b) without the consent of the joint electricity authority, supply electricity directly to any authorised undertakers in the district of a joint electricity authority which the joint electricity authority are authorised to supply;
3. (c) supply electricity directly to any authorised undertakers in the 1217 Edinburgh and Lothians electricity district without the consent of the corporation of Edinburgh.

(2) Where any authorised undertakers have demanded such a supply from the Board, and it appears to the Board that the outlay incurred in providing the main transmission lines required for the supply would, having regard to the supply required, entail unreasonable expense on the Board, they may represent the case to the Electricity Commissioners, and the Commissioners may, if it seems to them to be just, authorise the Board to impose such terms and conditions as the Commissioners think fit on the giving of the supply.

(4) The Board may, before the carrying out of the works specified in a scheme in any area is completed, if they think fit, enter into arrangements with any authorised undertakers in the area (being undertakers to whom the Board on the completion of the scheme would be entitled to give a direct supply) for giving those undertakers, pending the completion of the scheme, a supply of electricity of such amount and upon such terms as may be agreed between them.

LORD GAINFORD moved, in subsection (1), to leave out paragraphs (a) and (b) and insert the following new paragraph:— (2)—(a)'supply electricity directly to authorised undertakers situate in the area of supply of a power company or the district of a joint electricity authority without the consent of the power company or the joint electricity authority, unless the power company or the joint electricity authority are unable or unwilling to supply electricity to such authorised undertakers on reasonable terms and conditions to be determined in case of dispute by the Electricity Commissioners.

The noble Lord said: My Lords, this is another case in which it appears that an injustice is being done to the power companies, and I suggest that the power companies and the joint electricity authority should be placed in a similar position by the omission of paragraphs (a) and (b) and the substitution of that which appears upon the Paper. This, it seems to me, will be a fair arrangement. It must, I think, be recognised by your Lordships that the actual or prospective customers of power companies are important assets in connection with their work, and it is necessary that the power companies, who undertake their obligations, should be permitted to do so. If the Board are given an unrestricted right to supply electricity in bulk direct to authorised undertakers, the power companies are likely to lose most valuable existing or prospective business. This clause will make it still snore difficult for the power companies to supply electricity at lower prices to their other customers and therefore it will be detrimental to the bulk supply of power companies to their consumers. On those grounds I move this Amendment, so as to place the power companies exactly on a par with the joint electricity authorities and I hope the noble Viscount in charge of the Bill will be prepared to accept it.

Amendment moved— Page 13, lines 9 to 25, leave out paragraphs (a) and (b) and insert the said new paragraph—(Lord Gainford.)

VISCOUNT PEEL

My Lords, the Bill, as it stands, recognises the existing position that, in power company areas where according to the existing rights of the parties the municipality, let us say, has an absolute right of veto on the supply by the power company in its area, the municipality shall still maintain that right, and shall be able to go, if it chooses, direct to the Board for its supply. The noble Lord, by his Amendment, wishes to alter the present statutory position and to take away that right from the municipalities. I submit to your Lordships that nothing has been changed and therefore the position ought to remain as it was. Under the Bill there is nothing to prevent a municipality, if it likes, from going direct to the power company. There is nothing to prevent them getting a supply from the Board through the power company, if it is convenient, but the clause as it stands merely retains the existing position. I do not think the noble Lord has really shown any reason why this power of veto should be taken away from the municipalities, and why the liberties of the power company should be enlarged in this way at the expense of the municipalities. I submit to your Lordships that the position ought to be left as it is.

LORD GAINFORD

My Lords, the Amendment is not moved with a view to interfering with the veto of the municipal authorities who are interested in the supply of their own area, but it is moved to enable the municipal authorities to obtain from the power companies these supplies instead of placing the new Board in a competitive position in relation to the power companies. It is because the power companies ought to have the opportunity of supplying the deficiencies of the municipal authorities rather than the Board that I suggest that, at any rate, the right should be given to the power companies and they should not be prejudiced.

VISCOUNT PEEL

In answer to the noble Lord the municipalities can, if they like, go direct to the power companies and deal direct with them. There is nothing to prevent them from doing it. All it means is that they retain the power not to go to the power companies if they do not want to. The position is left as it is at present.

Amendment, by leave, withdrawn.

LORD MONTAGU OF BEAULIEU moved, at the end of subsection (2), to insert:— Provided that the outlay incurred in providing and maintaining transformers or other apparatus for reducing the pressure at which a supply of electricity is furnished to an authorised undertaker shall not be deemed to be an unreasonable expense. The noble Lord said: My Lords, the noble Lord said just now that in his opinion the current would be obtainable after it had left the transformer and become suitable for general use. I put this Amendment down merely to say that the erection of such transformers would not be an "unreasonable expense," as defined by subsection (2), where these words occur:— having regard to the supply required entail unreasonable expense on the Board. It is a question of what "unreasonable" might mean in that case. If the noble Viscount can accept my Amendment, it makes it quite clear that the Board would be justified in incurring the expense of these transformers, and that would not be in the words of this Bill, an "unreasonable expense."

Amendment moved— Page 13, line 39, at end insert the said proviso—(Lord Montagu of Beaulieu.)

VISCOUNT PEEL

My Lords, I suggest to my noble friend that really the matter should be left as it is, because these questions of the price of current and so on are matters to be dealt with on business lines between the Board and the different authorities. After all, in some cases high-tension electricity would be demanded without much transformation, while in other cases electricity of different voltages would be needed. You really cannot lay down details of that kind in the Bill. I suggest that that should be left to the authorities concerned to fight out among themselves. As for the definition of "unreasonable expense," I am advised that this reference to unreasonable expense is a clause which is put in all power companies' Bills for the protection of the power companies. I think the clause in those cases is rather an intricate one. In this case I think the exact bargain to be, made between the authorities must really be left to the authorities themselves.

Amendment, by leave, withdrawn.

LORD MONTAGU OF BEAULIEU moved to add to subsection (2):— Provided that in every case in which the Commissioners authorise the Board to impose terms and conditions under this section the Minister of Transport shall make a special Report to both Houses of Parliament stating the circumstances of the case. The noble Lord said: My Lords, this, the second part of my Amendment, is merely to lay down that, in every case in which the Commissioners authorise the Board to impose terms and conditions under this section, the Minister of Transport shall make a special Report to both Houses of Parliament. Unless you have some condition of that kind, it might be possible for the Commissioners of the Board to refuse to supply a district in which there was a slight loss. There would be no remedy, and nobody would ever hear about it because it would never come to the knowledge of anybody. If matters are left as indicated by one noble Lord, and this scheme is only to be applied to the great industrial areas, it means, as I told the House before, that it is a farce for the country districts. It is important where there is a dispute that there should be a Report to both Houses of Parliament.

Amendment moved— Page 13, line 39, at end insert the said proviso—(Lord Montagu of Beaulieu.)

VISCOUNT PEEL

My Lords, this is really a very large matter that my noble friend is asking. He says that, in all these cases, a special Report should be made to both Houses of Parliament. These terms and conditions will be of a highly technical kind and, as far as I know, there is no precedent for making such very detailed technical Reports and laying them before both Houses of Parliament. I submit, with all respect to noble Lords and members of another place, that they will probably find it very difficult to understand them, because they would be conditions imposed with reference to transactions in which they were not engaged. I think it will be very difficult for them to be appreciated, and I very much doubt whether any advantage would be gained.

Amendment, by leave, withdrawn.

VISCOUNT PEEL

The next Amendment, in my name, is a drafting Amendment.

Amendment moved— Page 15, line 19, leave out ("scheme") and insert ("works")—(Viscount Peel.)

On Question, Amendment agreed to.

Clause 11 [Tariff for electricity supplied directly by Board]:

VISCOUNT PEEL

My Lords, the next Amendment is practically drafting. The object is only to put in rather clearer language that by order of the Commissioners a tariff of a more elastic nature may be made.

Amendment moved— Page 15, line 40, after ("Commissioners") insert ("or the tariff may be framed in such other manner as may be determined by an order of the Electricity Commissioners")—(Viscount Peel.)

On Question, Amendment agreed to.

VISCOUNT PEEL

The next is a consequential Amendment.

Amendment moved— Page 15, lines 41 and 42, leave out ("Provided that an order of the Electricity Commissioners under this subsection") and insert ("but such an order")—(Viscount Peel.)

On Question, Amendment agreed to.

Clause 13:

Limitation, on price to be charged to owners of selected stations.

13. Where any authorised undertakers, being the owners of an existing generating station which by virtue of this Act becomes a selected station, who take a supply of electricity from the Board prove to the satisfaction of the Electricity Commissioners that the cost of taking that supply front the Board on the terms provided by this Act in any year exceeds the cost which they would have incurred had this Act not been passed in themselves generating the like quantity of electricity, then the charges by the Board to those undertakers for the supplies of electricity furnished to them shall be so adjusted that the amount charged in that year does not exceed the cost which, in the opinion of the Electricity Commissioners, the undertakers would have incurred in themselves generating the electricity.

LORD GAINFORD moved to omit all words after "Electricity Commissioners that" and to insert:— the aggregate of (i) the cost of taking that supply from the Board on the terms provided by this Act, and (ii) the cost properly incurred by those undertakers in generating at any other generating station belonging to them and not being a selected station, any additional quantity of electricity required for the purposes of their undertaking exceeds in any year the cost which they would have incurred had this Act not been passed in themselves generating a total quantity of electricity equal to the sum of (a) the quantity so taken from the Board, and (b) the additional quantity of electricity so generated by them, then the charges by the Board to those undertakers for the electricity supplied by the Board in that year shall be so adjusted that the aggregate of (i) the amount so charged by the Board, and (ii) the cost properly incurred by the undertakers as aforesaid in generating the said additional quantity of electricity does not exceed the cost which in the opinion of the Electricity Commissioners, the undertakers would have incurred in themselves generating the said total quantity of electricity.

The noble Lord said: My Lords, it is believed that a power company owning several stations may be prejudiced by the fact of the Board taking selected stations and imposing certain special obligations on the power company. The company may be prejudiced thereby in the cost of operating the other stations in its area. In other words, if there was no Board to deal with the selected stations there would be a certain specified cost to the power company with regard to all its stations, but if the Board select a station, which is called a selected station, and by the imposition of terms on the power company prejudice the power company thereby in the working of its other stations, it is obviously fair that there should be some adjustment so that the power company should not be prejudiced by the imposition of those obligations. It is with a view to secure that the power company should have a claim which should be properly adjudicated, and which would be approved by the proper authority, that I venture to move this Amendment, so as to secure a fair adjustment of price in the interests of the power companies.

Amendment moved— Page 16, line 30, leave out from ("that") to the end of the clause, and insert the said new words—(Lord Gainford.)

VISCOUNT PEEL

My Lords, I understand that the Amendment of the noble Lord applies to a case where an authority has several power stations, one or possibly more of which is selected by the Board, whereas others are not selected by the Board and become in the technical language of this Bill "non-selected stations." He suggests that the advantages which are given to the owners of a selected station qua selected station, as to the guarantee, should be also extended to the non-selected stations which the authority or company own. I submit to your Lordships that the Board have no control over non-selected stations. They are dealing with selected stations, and there seems no reason why the benefit of the guarantee should be extended to the non-selected stations. Supposing the owners find themselves in some difficulty as regards the non-selected stations as to the question of price, they can always put the matter right by taking their supply from the Board. When they take their supply from the Board they get the other advantages of the stations which get their supply from the Board, and therefore it seems to me that both ways they do not suffer, and the Amendment is unnecessary.

LORD GAINFORD

My Lords, in reply to the noble Viscount, I think I must press this Amendment, because it only applies where a fair claim can be put forward as the result of new obligations being placed upon a company, which are going to prejudice their existing stations. It is only fair where these obligations are placed upon an authority, prejudicing them in connection with their cost at other stations, owing to the operation of the selected station, that they should have a right to a claim. If they are going to benefit, as the noble Viscount suggests, then there would be no claim. It is quite possible that they might be benefited by working the selected stations, but if their other stations are going to be prejudiced thereby, it seems to me that they ought to be able to put forward a claim. After all, under the Amendment which I propose to introduce, such a claim has to be approved by the Electricity Commissioners, and therefore no unreasonable claim can possibly be allowed. As the noble Viscount said on the last occasion that the Government intended to be reasonable, I hope he will accept the principle of my Amendment, even although he is not going to accept the technical wording of it, and give the matter further consideration.

VISCOUNT FALMOUTH

My Lords. I hope the noble Viscount will see his way to accept this Amendment. Very great hardship may be inflicted upon authorised undertakers who have several stations—not only companies but big municipalities. These big electrical systems are made up of three or four capital stations. The whole system is looked upon as one station, although it is scattered over a very large area. It is electrically interconnected far more rigidly than if it were connected by mechanical ties. In fact the revolutions of the machines synchronise over a very large area. Seeing that this Bill, if it goes through, would give the Board authority to say that one of these stations should be a selected station, and not the others, it would very likely throw out of balance the whole of the complicated system. These other stations, which have been erected and provided with very costly and elaborate machinery with a view of running parallel to another station which is now being made a selected station, will not be able to operate with their full efficiency. It seems to me that ample safeguard is offered by the fact that this question will have to be looked into by the Electricity Commissioners. Any claim that one of these undertakers may make has to run the gauntlet of an inquiry by the Commissioners, and that should be sufficient to prevent any unjust claim being made on behalf of the authorised undertakers.

VISCOUNT PEEL

My Lords, I really do not think that either noble Lord has been able to point out any respect in which these non-selected stations would be damnified, because what happens in the case of a selected station? It will produce the same, or a larger, amount of electrical power, and it would thus get a better load and produce electricity more cheaply. I do not see how the undertakers could be damnified in respect of their selected station. The noble Lords have not told us how they are damnified. They say that these stations are operating in a connected system, working together. No doubt that may be so, but why one of them producing more power under the direction of the Board should put the others out of gear is, I must say, extremely difficult to understand. But, even supposing they were injured, they have the opportunity of taking their supply direct from the Board.

Resolved in the affirmative, and Amendment disagreed to accordingly.

Clause 14 [Power to close generating stations in certain events]:

LORD ASKWITH moved the insertion of the following new subsection:— (5) Where an undertaking or any part thereof of any authorised undertakers is liable to purchase at any time within ten years after the passing of this Act, and the cost to the undertakers of taking the whole of their supply directly or indirectly from the Board, as provided for in subclause (1) hereof, will be more than the then prevailing

LORD GAINFORD

May I explain that the Board, under the provisions of the Bill, when they select a station may impose conditions on the power company possessing other stations, which will prejudice it in connection with those other stations,, and it is only then that the claim will be put forward, and it is reasonable that they should have an adjustment made in the price.

On Question, Whether the words proposed to be left out shall stand part of the clause?

Their Lordships divided: Contents, 54; Not-Contents, 24.

CONTENTS.
Cave, V. (L. Chancellor.)	Chaplin, V.	Gage, L. (V. Gage)
	Churchill, V.	Gorell, L.
Balfour, E. (L. President.)	Devonport, V.	Hampton, L.
	Falkland, V.	Hawke, L.
Sutherland, D.	Haldane, V.	Howard of Glossop, L.
Wellington, D.	Hood, V.	Kilmarnock, L. (E. Erroll.)
	Peel, V.	Knaresborough, L.
Airlie, E.		Kylsant, L.
Calrendon, E.	Worcester, L. Bp.	Lawrence, L.
Jellicoe, E.		Lawerence of Kingsgate, L.
Lindsey, E.	Atkinson, L.	Meldrum, L.(M. Huntly.)
Lovelace, E.	Biddulph, L.	Merrivale, L.
Lucan, E. [Teller.]	Bledisloe, L.	Ormonde, L. (M. Ormonde.)
Morton, E.	Clanwilliam, L. (E. Clanwilliam)	Revelstoke, L.
Onslow, E.		Ritchie of Dundee, L.
Plymouth, E. [Teller.]	Darling, L.	Roundway, L.
Russell, E.	Desart, L. (E. Desart.)	Saltoun, L.
Spencer, E.	Dynevor, L.	Suffield, L.
Stanhope, E.	Ernle, L.	Wyfold.
	Faringdon, L.	Wynford, L.
Astor, V.

NOT-CONTENTS.
Lincolnshire, M. (L. Great Chamberlain)	Askwith, L.	Gainford, L. [Teller.]
	Avebury, L.	Monkswell, L.
Reading, M.	Banbury of Southam, L.	Montagu of Beaulieu, L.
	Carson, L.	Newton, L.
Beauchamp, E.	Charnwood, L.	Oranmore and Browne, L. (L. Mereworth.)
	Clwyd, L.
Bertie of Thame, V.	Danesfort, L.	Phillimore, L.
Falmouth, V. [Teller.]	Emmott, L.	Strachie, L.
Novar, V.	FitzWalter, L.	Sydenham of Combe, L.
		Wittenham, L.

cost to those undertakers, the Board may come to an arrangement with the undertakers whereby the undertakers agree to take the whole of their supply of electricity from the Board directly or indirectly on condition that the Board agree to repay to the undertakers any expenditure necessarily incurred by them in carrying out a change of their system of supply from a direct current system to an alternating current system, such payment to be provided for by the Board in like manner to the payments made under Section nine (1) and (2) of this Act.

The noble Lord said: My Lords, on the Committee stage the noble Viscount said that he would consider on Report the question of companies coming to an end. This Amendment is designed to deal with companies which come to an end within a time-limit of ten years. If a change had then to be made from direct to alternating current it would be very difficult for them either to raise the necessary capital or to employ it; it would, in fact, have a stultifying effect on the action of the company. It is suggested, therefore, that when companies come to the end of a short tenure it is to the advantage of the purchasing authority that the change should be made from direct to alternating current before they are taken over. I submit that it is both advantageous to the consumer and to the welfare of the undertaking itself that the change should be made in due time and not be throttled, as it were, by the short tenure.

Amendment moved— Page 18, line 7, at end insert the said new subsection—(Lord Askwith.)

VISCOUNT PEEL

My Lords, I understand that this Amendment applies to the case of companies which, as the noble Lord says, have a short tenure of life, and which may want to change from a direct to an alternating current and do not feel it worth while to do so because of their short tenure. He suggests it might be an advantage to those who take them over that the change should be made within the ten years. I understand that Clause 38 provides for that particular state of things, and that if they have to put some of their machinery, as it were, out of gear through the change from one system to another they will be repaid the capital so expended by the particular party that takes them over. In that case it would appear that my noble friend's fears are provided for, so to say, and that there is no necessity for this Amendment.

LORD ASKWITH

If the noble Viscount assures me that this is already provided for, I do not wish to press my Amendment.

Amendment, by leave, withdrawn.

VISCOUNT PEEL moved, after Clause 18, to insert as a new clause:—

special provisions as to London.

"Where any obligation to carry out any technical scheme imposed on a joint electricity authority, local authority, company or body by or under the London and Home Counties Electricity District Order, 1925, or the London Electricity (No. 1) Act, 1925, or the London Electricity (No. 2) Act, 1925, conflicts with any obligation arising out of a scheme under Section 4 of this Act which is imposed by or under this Act, on any such authority, company or body, the last mentioned obligation shall prevail."

The noble Viscount said: My Lords, this clause is rather in the nature of a precautionary measure. Supposing a scheme is being made under the London Order of 1925 and another scheme under this Bill, it suggests that this scheme should prevail and that there should be no discrepancy, therefore, between the two schemes and no difficulty as between the different power companies to whom the schemes apply.

Amendment moved— Page 20, after Clause 18, insert the said new clause—(Viscount Peel.)

On Question, Amendment agreed to.

Clause 19:

Application of Electricity Supply Acts to Board.

19.—(1) Subject to the provisions of this section, the Board shall be deemed to be undertakers and authorised undertakers within the meaning of the Electricity (Supply) Acts, 1882 to 1922, and this Act in relation to the Board shall be deemed to be a special Act for the purposes of those Acts, and for the purposes of this section there shall be incorporated with this Act the provisions of the Schedule to the Electric Lighting (Clauses) Act, 1899, subject to such exceptions and modifications as may be prescribed by regulations made by the Electricity Commissioners:

Provided that sections two and three of the Electric Lighting Act, 1888 (which relate to the purchase of undertakings by local authorities) shall not apply to the undertaking of the Board.

VISCOUNT PEEL moved, in subsection (1), after "Provided that," to insert "section 13 of the Electric Lighting Act, 1882 (which relates to the breaking up of private streets, railways and tramways) and." The noble Viscount said: The object of this Amendment is to allow the Board to proceed rather more quickly than it might otherwise do. Section 13 of the Electric Lighting Act, 1882, imposes restrictions upon the breaking up of private streets, railways or tramways without the consent of the repairing authority unless in pursuance of special powers inserted in the licence, Order, or special Act or with the written consent of the Board of Trade. I understand that a similar clause is contained in most Power Acts for the purpose of obviating the consent of the Commissioners in a particular case. I beg to move.

Amendment moved— Page 20, line 19, after ("that") insert the said new words—(Viscount peel.)

LORD MONTAGU OF BEAULIEU

My Lords, I understand that power lines are to be laid, as a rule, alongside of the road, but when they are laid allowance must be made for future widenings. Will the noble Viscount tell me whether the local authorities have power to prevent the breaking up of roads and power also to compel the cables to be laid on the verges of roads so as to preserve the highway intact?

EARL RUSSELL

My Lords, before the noble Viscount replies, will he kindly say whether this power, which is a power of breaking up streets, does anything contrary to the London Traffic Act or will it still be subject to the provisions of that Act?

VISCOUNT PEEL

No, I do not think it affects that. As for the fear of streets being broken up, to which I think the noble Lord, Lord Montagu of Beaulieu, referred, it only deals with the matter so far as the consent, of the Electricity Commissioners is concerned.

On Question, Amendment agreed to.

VISCOUNT PEEL moved to add to subsection (1):— and that Section twenty of the Schedule to the Electric Lighting (Clauses) Act, 1899, in its application to the Board, shall have effect as if after the words 'electric signalling communication' wherever they occur, there were inserted the words 'or electrical control of railways.' The noble Viscount said: My Lords, this is a rather technical Amendment. It merely transfers certain words from the schedule into this part of the Bill so as to apply to the works of the Board only and not to existing undertakers. I beg to move.

Amendment moved— Page 20, line 22, after ("Board") insert the said new words—(Viscount Peel.)

On Question, Amendment agreed to.

Clause 20:

Acquisition of land by the Board.

20.—(1) The Board may acquire laud or any easements or servitudes or other rights in or over land by agreement, or may be authorised to acquire land or any such right compulsorily, for the purpose of any of their powers and duties under this Act (including the construction of main transmission lines) in like manner as a local authority being authorised undertakers may acquire or be authorised to acquire land under the Electricity (Supply) Acts, 1882 to 1922, for the purpose of a generating station, and those Acts and the Acts incorporated therewith shall apply accordingly; and the Board shall be deemed to be a public authority for the purposes of the Acquisition of Land (Assessment of Compensation) Act, 1919.

LORD DYNEVOR moved to substitute "other than" for "including" ["including the construction of main transmission lines"]. The noble Lord said: My Lords, in moving this Amendment I will do my best to avoid repeating any arguments I used either on the Second Reading or during the Committee stage in regard to Clause 20. Your Lordships may remember that in Committee I withdrew ray Amendment at the request of my noble friend Lord Peel in order that we might talk over the question. I regret to say that no agreement has been arrived at. Your Lordships may remember that my two chief objections to the Clause were, first, the compulsory purchase by the Board for transmission lines and the causing of severance; and, secondly, that there is no alternative route offered by the Bill when the owner wants to use the land for development purposes either for building or for mineral development.

I should like to point out to your Lordships that my two Amendments roust be read together—this Amendment and the proviso which follows on the Marshalled List of Amendments. One is useless without the other, so that I will explain the two together with your Lordships' permission. My first Amendment prevents the compulsory purchase of land for transmission lines, but I leave the right to purchase land for transmission lines by agreement. Then I leave the power to the Board to buy land compulsorily for all purposes in connection with the Bill other than for transmission lines. Next comes the proviso that the Board can acquire compulsorily an easement, servitude or other right of way for the transmission lines, but the owner of the land can demand a permanent wayleave. I then put in words for an alternative route for the transmission lines. Lest anyone should suggest that if the owner of the land is receiving a full wayleave rent for his land he ought not to put the Board to the expense of moving the transmission lines to an alternative route, I have inserted words that if the owner accepts a nominal rent or one shilling per pole or standard he shall then only have the right of asking that the poles should be moved and he must offer an alternative route on his land; also if it can be proved to the Railway and Canal Commission that his loss is greater than the cost of an alteration of the transmission lines when the land is wanted for building, mining or any other industrial purpose or for roads or sewers necessary in connection with any of these purposes.

I think I really have fully considered thy, position of the Board. The owner of the land must give facilities for altering transmission lines and providing an alternative route on his land. I would remind your Lordships of the assurance given me by the Ministry of Transport in 1922 that they would put into all future applications a power of revision to the Minister in case diversion of the lines should be at any time desirable. That assurance is not in any Act of Parliament nor is it in this Bill. It has not the force of law behind it and I should like to put it into this Bill, although up to the present I have no knowledge that it has not been so acted upon. In the Government Amendment, which I see my noble friend Lord Peel is to move later on to this clause, I see no reference to that assurance. As I said before, I have no wish to prevent lines crossing the country, but this can be done as at present under Section 22 of the Electricity Act, 1919, by means of a wayleave. I have spent many hours in considering the best method of dealing with this most difficult question and I have had many interviews. I regret that there is really a deadlock. I am trying to look after the interests of all landowners both large and small and at the same time trying to assist the Government. I really have gone as far as I can and I have also given way in my objection to the Board acquiring land under the Acquisition of Land (Assessment and Compensation) Act, 1919. But I am still ready to offer the Government an olive branch. If my noble friend Lord Peel will give me in this House a definite promise that the assurance given me in 1922 by the Ministry of Transport that they would put into all future applications a power of revision to the Minister in case diversion of the lines should be at any time desirable will be carried out, I would then withdraw my Amendment and accept my noble friend's Amendment. I beg to move.

Amendment moved— Page 21, line 11, leave out ("including") and insert ("other than")—(Lord Dynevor.)

VISCOUNT PEEL

My Lords, I think it might perhaps he convenient for your Lordships if I am permitted to make a reference to my Amendment when discussing the Amendment of the noble Lord, because my Amendment really is an alternative one and I put it down in the hope that my noble friend might withdraw his and allow mine to be moved. I also took a great deal of trouble and had a great many interviews on this rather difficult clause and I thought I had almost met my noble friend. He tells me that is not so. I felt the force of the point he urged when he was discussing this matter on Second Reading, and when he asked: Was it necessary that this land should be acquired for these wayleaves and that all sorts of severances should be established when these lines were going across country; and was it not quite enough to have way-leaves and servitudes over the land? I was much impressed by the argument of my noble friend and I thought it would be very much better to do it in that way if it were possible to carry the lines, subject to those rights.

May I read my Amendment to your Lordships? Provided that the Electricity Commissioners shall not make and the Minister of Transport shall not confirm any special Order authorising the Board to acquire land or a right in or over land compulsorily for the purpose of a main transmission line unless satisfied that the objects sought to be attained cannot consistently with efficiency and economy be attained by the acquisition of a wayleave in accordance with the provisions of Section 22 of the Electricity (Supply) Act, 1918. That suggestion which I have put upon the Paper does, I think, substantially meet the point raised by my noble friend. May I say a word then as to the second point regarding the possibility of the owner insisting upon an alternative route? I am afraid that it would not be possible to accept the Amendment put down on that point by my noble friend. There are a considerable number of objections to it. My noble friend says that if the loss to the owner is greater than the cost of moving it then the Railway and Canal Commission shall order—there is no option for the Railway and Canal Commission, they have to order—the Board to remove the line. You cannot put a thing like that into the Bill merely on the question of cost. There are also a great number of technical considerations involved which may make it wholly inadvisable either to move a particular line a particular way or to move the line to new land pointed out by the owner. It may easily happen that the owner has not any other suitable land.

LORD DYNEVOR

It must be on his own land.

VISCOUNT PEEL

But if he has not any other land.

LORD DYNEVOR

Then he cannot ask for the alteration.

VISCOUNT PEEL

In any case the technical difficulties are not considered. My noble friend really puts the matter on the question of expense, and that is one among many reasons why I am afraid it is impossible to accept it. My noble friend said that if I could make some statement about the policy followed by the Ministry of Transport in these matters that would go some way to meet him. May I let the noble Lord know what is the practice of the Board in these matters? The Minister in these cases of wayleaves invariably reserves the right to revise his consent after a specified number of years, generally five. This course would naturally be followed in the case of the wayleaves asked for by the Board. At any time after the expiry of the term of years the owner is entitled to approach the Minister and ask for the case to be reviewed, and then, of course, when the case is reviewed alternative routes could be considered.

But I do want to make it quite clear to my noble friend and other noble Lords that these are not on exactly the same lines as many of the ordinary poles that are put up by electricity companies. These high-tension cables are a much more serious business. It is a much more serious business to move them. The columns which bear them are more permanent. Therefore I should not be quite frank unless I made it clear that it is more difficult to move poles and lines in the case of high-tension cables and columns than in the case of ordinary transmission by an electricity authority. But, subject to that warning, I have tried to meet my noble friend as best I can. I think I have met him as regards the acquisition of land. I agree I have not met him entirely about the removal of the lines in case of development and so on, but I have done my best to do so by what I have stated about the invariable practice of the Minister. I hope in these circumstances he may see his way to withdraw his Amendment and allow mine to be put forward.

LORD DYNEVOR

My Lords, I just want to ask my noble friend what is exactly the assurance he has given. He refers to the general practice, but I am not quite sure what he really has promised me. Will he give me in this House a definite promise that the assurance given me in 1922 by the Minister of Transport shall continue. That assurance was that instructions would be issued that in all future applications to Mace lines on private land no consent under the Act of 1922 should be given without reserving to the Minister a power of revision in case diversion of the position of the lines should at any time he desirable. Can he give me an assurance that that will continue?

LORD BANBURY OF SOUTHAM

My Lords, I am rather sorry my noble friend has asked for that assurance, because what is the value of it Presuming the noble Viscount, Lord Peel, gives the assurance, and presuming in three or four years' time the noble and learned Viscount opposite is head of a Labour Government, and the noble Earl who I see has been promoted to sit on the Front Bench is at the Ministry of Transport, what will happen? They will disregard the promise altogether. If they were reminded by my noble friend that three or four years previously a promise was given in this House, what would they say? The noble and learned Viscount would produce the Act and say: "There is nothing in the Act which says anything about doing this or doing that. All I have got to deal with is the Act of Parliament. Here is the Act of Parliament, and I am going to carry that out. I cannot help what pledges may have been given by a Minister even of my own Party, let alone pledges given by a Minister in a previous Government. I shall not pay any attention to them." And the noble and learned Viscount would be right. How could anybody administer the law, not in accordance with what is contained in an Act of Parliament, but in accordance with something which somebody had said in this place or in another place? I sincerely hope my noble friend will withdraw his proposal, and that he will adhere to the proviso which he has put on the Paper. I think I should be in order in saying a word upon the proviso which my noble friend Viscount Peel has on the Paper.

VISCOUNT PEEL

What do you want me to do exactly?

LORD BANBURY OF SOUTHAM

I want you to accept my noble friend's Amendment. With regard to the proviso of my noble friend Viscount Peel, would he leave out the words "consistently with efficiency and economy"? That might make his clause of some value. As it is now it is of no value at all because any future Minister of Transport—no one

knows who on earth he may be—might say: "Oh, in my opinion it is not economical," or "It is not efficient," and there would be an end of it. If he would leave out those words, and if my noble friend Lord Dynevor agrees, I think that might meet the difficulty.

VISCOUNT PEEL

I am afraid it would be rather difficult to leave out the words "consistently with efficiency and economy." Does my noble friend mean that if it is inefficient and uneconomical it should be done?

LORD BANBURY OF SOUTHAM

If those words were omitted the clause would then read "unless satisfied that the objects sought to be attained cannot be attained by the acquisition of a wayleave." That would be a clear direction then.

VISCOUNT PEEL

I think if there were very large questions of expense—

LORD BANBURY OF SOUTHAM

I do not think that expense appeals to the present Government.

VISCOUNT PEEL

It might appeal to a later Government.

LORD BANBURY OF SOUTHAM

Later and worse.

On Question, Whether the word "including" shall stand part of the clause?—

Their Lordships divided: Contents, 63: Not-Contents, 16.

CONTENTS.
Cave, V. (L. Chancellor.)	Scarbrough, E.	Faringdon, L.
	Spencer, E.	FitzWalter, L.
Balfour, E. (L. President.)	Stanhope, E.	Forres, L.
		Gage, L. (V. Gage.)
Sutherland, D.	Allendale, V.	Gainford, L.
Wellington, D.	Chaplin, V.	Gorell, L.
	Churchill, V.	Hawke, L.
Lincolnshire, M. (L. Great Chamberlain.)	Falkland, V.	Howard of Glossop, L.
	FitzAlan of Derwent, V.	Jessel, L.
Reading, M.	Haldane, V.	Knaresborough, L.
	Hood, V.	Kylsant, L.
Airlie, E.	Novar, V.	Merrivale, L.
Beauchamp, E.	Peel, V.	Muir Mackenzie, L.
Clarendon, E.		Olivier, L.
De La Warr, E.	Worcester, L. Bp.	Rodesdale, L.
Gainsborough, E.		Revelstoke, L.
Jellicoe, E.	Arnold, L.	Ritchie of Dundee, L.
Lindsey, E.	Biddulph, L.	Roundway, L.
Lovelace, E.	Bledisloe, L.	Saltoun, L.
Lucan, E. [Teller.]	Charnwod, L.	Teynham, L.
Morton, E.	Clwyd, L.	Thomson, L.
Onslow, E.	Darling, L.	Wyfold, L.
Plymouth, E. [Teller.]	Emmott, L.	Wynford, L.
Russell, E.	Ernle, L.
NOT-CONTENTS.
Bertie of Thame, V.	Dynevor, L. [Teller.]	Montagu of Beaulieu, L.
Falmouth, V.	Lawrence, L.	Newton, L.
	Meldrum, L. (M. Huntly.)	Penrhyn, L.
Askwith, L.	Monk Bretton, L.	Phillimore, L.
Avebury, L.	Monkswell, L.	Sydenham of Combe, L.
Banbury of Southam, L. [Teller.]		Wittenham, L.

On Question, Amendment agreed to.

Resolved in the affirmative, and Amendment disagreed to accordingly.

VISCOUNT PEEL moved, at the end of subsection (1), to insert: Provided that the Electricity Commissioners shall not make and the Minister of Transport shall not confirm any special Order authorising the Board to acquire land or a right in or over land compulsorily for the purposes of a main transmission line unless satisfied that the objects sought to be attained cannot consistently with efficiency and economy be attained by the acquisition of a wayleave in accordance with the provisions of Section twenty-two of the Electricity (Supply) Act, 1919. The noble Viscount said: My Lords, I do not think I need say anything about this Amendment, because I have already explained it to your Lordships.

Amendment moved— Page 21, line 20, at end insert the said proviso—(Viscount Peel.)

VISCOUNT PEEL moved the insertion of the following new clause after Clause 22:—

Protection of Government observatories, &c.

".The Board shall not provide, construct, equip, or alter or use any generating station, sub-station, transformer station, building, plant, machinery, electric main, appliance work, or apparatus, or use or permit to be used, transmit, convert, or transform any electrical energy either under this Act or otherwise in such manner as to affect injuriously in any respect whatever either by vibration or obstruction or smoke or by electric or electro-magnetic action or influence, or by any means whatsoever whether similar to those enumerated or not any Government observatory or laboratory existing at the passing of this Act or any instrument or apparatus in or adjacent thereto, and used in or in connection therewith."

The noble Viscount said: My Lords, this is merely an Amendment to protect Government observatories and other buildings of that class.

Amendment moved— Page 22, line 7, at end insert the said new clause—(Viscount Peel.)

Clause 27:

Power to Treasury to guarantee loans to Board.

27.—(1) Subject to the provisions of this section, the Treasury may guarantee in such manner as they think fit, the payment of the interest and principal of any loan proposed to be raised by the Board, or of either the interest or the principal:

Provided that the aggregate amount of the loans, the principal or interest of which may be so guaranteed, shall not exceed thirty-three and a half million pounds.

LORD DANESFORT had given Notice to move, after subsection (1), to insert a new subsection. The noble Lord said: My Lords, by Clause 27 the Treasury are empowered to guarantee payment both of interest and principal on any loan proposed to be raised by the Board up to the amount of £33,500,000, and the object of my Amendment is to provide definitely in the Bill that the Treasury, before it guarantees the principal or interest of these loans to the Board, shall ascertain on what objects the money is to be spent and whether the expenditure is beneficial for the purposes of the Bill and is likely to prove remunerative. I propose to add a few words at the end of the proposed subsection, so that it will read as follows:— (2) A guarantee shall not be given under this section unless the Board has furnished the Treasury with a statement showing how and for what purposes the loan is to be expended, and the Treasury are satisfied after consultation with an Advisory Committee nominated by them or are by some other mode of investigation satisfied that the expenditure for which the loan is required is proper and necessary for carrying out the objects of this Act, and is likely to prove remunerative. I venture to think that this raises a very serious question. Are we, or are we not, to have in the Bill some provision that will ensure that the Treasury, before guaranteeing these loans to the amount of £33,500,000, are satisfied that the objects for which the loan is raised are proper and that they will prove remunerative?

My noble friend Lord Peel, speaking in the debate in this House on November 30—the words will be found in Column 965 of the OFFICIAL REPORT—admitted that the Treasury ought to do this. He said: … is it not plain that it is not only their business but their duty to find out on what objects the money is to be expended and to lay down such conditions as they choose? Those are admirable words, and I am merely asking the noble Viscount to give effect to them. It is true that the noble Viscount said that the objects that we both desired to achieve were already secured by the Bill as it stands, and in support of that he pointed to the words of the Bill— …the Treasury may guarantee in such manner as they think fit, the payment of the interest and principal… and so on. I submit with great deference to my noble friend that, when the Bill says that they are to guarantee "in such manner as they think fit," this refers only to the mode of guarantee and not to the conditions and does not impose upon the Treasury any obligation to make any investigation whatsoever before they guarantee these loans.

Whether my noble friend is right or not in his interpretation of the clause, I would submit to him that it is far better to put definitely into the clause what he suggests, and what I humbly submit, to be the duty of the Treasury, rather than leave it to be inferred from what I venture to think are exceedingly vague and unsatisfactory words. My view upon that point is strongly confirmed by what was done when the Trade Facilities Acts were passed. I will quote very shortly what precautions were taken and imposed upon the Treasury before it guaranteed any loans under the Trade Facilities Acts. I notice with great satisfaction that this precedent of the Trade Facilities Acts is the very precedent which the noble Viscount himself invoked in speaking in this House on November 30, when he said: The terms of the guarantee are what are known as trade facilities terms.' I looked at once at the Trade Facilities Acts in order to see what precautions are imposed upon the Treasury by those Acts.

The Act of 1921, which was the first of those Acts, said: If the Treasury, alter consultation with an advisory committee nominated by the Treasury, …are satisfied that the proceeds of any loan …are to be applied towards or in connection with the carrying out of any capital undertaking, or in, or in connection with, the purchase of articles other than munitions of war …and that the application of the loan in the manner proposed is calculated to promote employment in the United Kingdom— one of the main objects of the Bill— the Treasury may …guarantee in such manner and form and on such terms and conditions as they think proper the payment of the interest and principal of the loan or of either interest or principal. So that the House sees that under that Act the Legislature were not content to say that the Treasury might guarantee the loan as they thought fit, which is what this Act says, but they imposed certain obligations upon the Treasury to inquire into the matter, and to satisfy themselves as to the main objects of the loan before any such guarantee was given.

If you look at the next Trade Facilities Act, that of 1922, which was to guarantee a loan to the Soudan, you find almost exactly the same provision. Section 3 of that Act says:— Subject to the provisions of this section, the Treasury may guarantee, in such manner as they think fit, the payment of the principal of and the interest on any loan raised by the Government of the Soudan for or in connection with works for the purpose of irrigating the Gezireh Plain…not exceeding in the aggregate …three million five hundred thousand pounds. Then there is a special subsection on which I have somewhat framed my subsection:— A guarantee shall not be given under this section until the Government of the Soudan have provided to the satisfaction of the Treasury and the Secretary of State— and then there are a series of provisions with which the Government of the Soudan have to comply as, for instance, provisions for raising, and appropriating, and duly applying the Soudan loan.

The last of those Acts with which I shall trouble your Lordships is the Trade Facilities Act of 1924, which extended the period during which facilities could be given under the two former Acts up to March 31, 1925. Section 2 of that Act says:— If the Treasury are satisfied—

1. (a) that the proceeds of any loan … are to be applied by way of capital expenditure on or in connection with a public utility undertaking in some part of His Majesty's Dominions in accordance with a scheme approved by the Government of that part of His Majesty's Dominions; and
2. (b) that the expenditure involved in the scheme is in anticipation of expenditure which would normally have been incurred at a later date; and
3. (c) that the application of the proceeds of the loan in the manner proposed is calculated to promote employment in the United Kingdom—"

one of the main objects of the guarantee—then the Treasury may … undertake to pay … not exceeding three quarters of any interest payable … so however that the amount payable … shall not exceed … five million pounds in all. So that in cases where far less sums than £33,000,000 were involved the Treasury were authorised by Parliament to make inquiries and see that the objects of the loan were in accordance with the objects of the Bill and were beneficial, and, unless they were satisfied with their inquiries they were prohibited from making the guarantee. That is the precedent I ask your Lordships to follow in this case.

May I point out to my noble friend that this is a case where above all such provisions should be inserted because this Board, as we are truly told over and over again, will not be subject to the control of any public Department whatsoever. It is under no responsibility to Parliament or to any one else as far as I can see. If it acts wrongly or spends money improperly, there is no one to whom we can appeal or complain. There is no one who will give any undertaking that the money will not be badly spent once more. Therefore it is all-important in this kind of case where money is advanced to an irresponsible Board, irresponsible in the sense that it is not responsible to Parliament or any other authority, that, before the money is guaranteed and the taxpayers' credit placed in jeopardy, the Treasury should make these inquiries and satisfy themselves on this point. I urge upon my noble friend that we should not leave it to the Treasury without any direction as to how they are to proceed. We may have every confidence in the Treasury of to-day but we may not have an equal confidence in the Treasury that will exist in five, ten or twenty years' time. It is vitally important that some check should be put upon the granting of these guarantees and the Treasury should be urged to make those inquiries which the noble Viscount himself has said it is not only proper but it is their duty to undertake.

Amendment moved— Page 24, line 33, at end insert as a new subsection:— ("(2) A guarantee shall not be given tinder under this section unless the Board has furnished the Treasury with a statement showing how and for what purposes the loan is to be expended, and the Treasury are satisfied after consultation with an Advisory Committee nominated by them or are by some other mode of investigation satisfied that the expenditure for which the loan is required is proper and necessary for carrying out the objects of this Act and is likely to prove remunerative.")—(Lord Danesfort.)

VISCOUNT PEEL

My Lords, my noble friend has made to your Lordships a forcible appeal as to the necessity of introducing some words into this clause which will give more definite directions to the Treasury than are contained in it at present. He is apparently satisfied with the Treasury as it stands now, but he thinks that a Treasury may arise in fifteen or twenty years' time which will not be so cautious as the Treasury which now exists.

LORD DANESFORT

I think it is a better Treasury than one that might exist some years hence. I do not say I trust them altogether.

VISCOUNT PEEL

The noble Lord does not trust any Treasury, but he trusts the present Treasury more than the Treasury we are likely to have in fifteen or twenty Years' time. I cannot conceive any Treasury that would guarantee a large loan without inquiring what the security is, how it is to be spent, and other conditions of that kind. If a Treasury did not ask questions of that kind one could not call it a Treasury. It would not be a financial body at all. In the maddest system of administration, even if we have a Communist Government, they would have to consider when they lent money what the security was—at least, I should imagine so.

Turning to the very interesting speech of my noble friend as to the Trade Facilities Acts, those, of course, were special Acts dealing with certain particular cases. They did no doubt—it was a new experiment—suggest that there should be set up a special committee of business men in each case to inquire into the particular conditions of the particular industry whose shares were to be investigated. That was right. After all, it was not within the general knowledge of the Treasury to be familiar with the way in which some particular industry, whose shares it might want to guarantee, was carrying on its business. To some extent the analogy is not quite so close in this case because this is a Board in the nature of a public Board carrying on operations all over the country, and much better known, anyhow, than any private company could be. But I take exception first of all to the addendum of my noble friend, which makes it far more difficult to accept the Amendment than it was before, because he says "and is likely to prove remunerative." That raises many difficult questions, because it is intended by the Bill that the Board shall make any profit, but merely pay its way, and when you ask whether a thing is going to prove remunerative, you mean is it going to result in the payment of dividends. When I invest money I want to know whether it is going to be remunerative or not. Apparently my noble friend has more philanthropic objects is view in the investment of his money.

The object of guaranteeing this money would be largely that the supply of electricity should be much cheaper than otherwise it would be. It is difficult to accept words so ambiguous as are the words proposed by my noble friend, with all respect to the great skill which he possesses in drafting. After considering the matter, and after discussing it with the Treasury, I find it difficult to know how the Treasury would have more control than they have now by the insertion of the proposed words in the Bill. I cannot conceive that any Treasury would not do these things without any direction coming from my noble friend. I was going to make a suggestion, because I certainly contend that "in such manner" applies not only to the particular method of guaranteeing the money but also implies conditions, and if my noble friend is really convinced that that is not so, I would ask him to consider whether after "in such manner" there should be inserted "subject to such conditions as they may think fit." If he likes a sentence of that sort to run the gauntlet in another place, I would let it go.

VISCOUNT BERTIE OF THAME

Perhaps I may be permitted to make a suggestion. Would the noble Viscount accept the words "pay its way" instead of "prove remunerative."

VISCOUNT PEEL

No, I could not accept them.

LORD BANBURY OF SOUTHAM

I think the words suggested by Viscount Peel would certainly be an improvement upon the clause as it now stands. I do not quite see why he objects to accepting the words of Lord Danesfort's Amendment, because, as I understand him, his argument is that the Treasury would do what Lord Danesfort desires without the direction being put in the Bill.

VISCOUNT PEEL

It is unnecessary, and one never wants to overload a Bill.

LORD BANBURY OF SOUTHAM

I have heard that argument advanced when Ministers—I do not suggest it is the case now—rather want to get out of an awkward Amendment. They say: "Oh, it is unnecessary to put that Amendment in, because it is understood." My own idea is that the clearer you make a Bill the better, and the clearer the Bill is the less chance there is of legal gentlemen having a great deal of work to do. That, not being a lawyer, I think is a good thing. What I want to point out is that as the Bill stands the Treasury may undoubtedly do what my noble friend wants them to do, but it is permissive only—they need not do it—and what he suggests is that it should be made obligatory upon them to do it. With regard to the words at the end of the Amendment "and likely to prove remunerative," after all does not the taxpayer want his money, if spent, to be remunerative? Presuming it is not remunerative, how is the taxpayer going to get his money back? Does that mean that this £33,500,000 is going to be given as a subsidy? What I am so very much afraid of, and always have been, as to this clause, is that the Treasury will advance the money, the idea that it is going to be a great financial success will be very soon exploded and the result will be that the money will be lost. In order to avoid that I think those words should be inserted. Can I not persuade Lord Peel to be a little more generous? We have been very kind to him, moved very few Amendments, and made very short speeches. Cannot we get a little reward for that, and will he not go a little bit further and accept at any rate a considerable portion of the Amendment?

LORD DANESFORT

My Lords, as I understand my noble friend, he is entirely in agreement with my Amendment, in this sense, that he thinks the Treasury ought to act as it is suggested they must act by this Amendment. He made some comment, it is true, upon the word "remunerative." I should have thought that the meaning of that was quite plain. The meaning I attach to it is that it would cheapen electricity. I do not want, however, to discuss such a small point as the technical meaning of particular words. He agrees that the Treasury ought to do that which I say they ought to be compelled by the Bill to do, and therefore I cannot imagine why those words should not be put in. If, however, he is not going to be moved by the rather pressing appeal of Lord Banbury, and reward us for having been so very considerate in the discussion on this Bill, then I think I shall be justified in saying that I will take the smaller measure and accept the words which the noble Viscount has suggested. I am not sure, however, that I can move them now, because my Amendment is at line 33 and the words which he proposes would come at line 27. If there is any technical difficulty about the moving of such an Amendment now perhaps he will put it down, or allow me to put the Amendment down, on the Third Reading. Do I understand that if I put the Amendment down on the Third Reading he will accept it?

VISCOUNT PEEL

I will not oppose it.

Amendment, by leave, withdrawn.

Clause 30:

Relation of charges to dividends.

30.—(1) Where any company, being authorised undertakers and not being a power company, receive a supply of electricity either directly or indirectly from the Board, the Electricity Commissioners may by a special order under section twenty-six of the Electricity (Supply) Act, 1919, make provision as to the relation between the charges to be made for electricity and the dividends to be paid by the company, and the order shall have effect, as if the provisions contained therein were in substitution for the provisions (if any) contained in the Act or order relating to the undertaking of the company as to the relation of charges to dividend:

Provided that where any such company carries on two or more separate undertakings one or more of which receive a supply from the Board, any such order shall regulate the charges to be made for electricity in the case of the undertaking or each of the several undertakings receiving such a supply in relation to the divisible profits on the capital attributable to that undertaking.

LORD A SKWITH had on the Paper two Amendments, the first to leave out all words in subsection (1) after ("section") and to insert "twenty-two of the Electricity (Supply) Act, 1922, regulate the charges to be made for electricity in respect to the undertaking or several undertakings for which the supply is received; and the second to add to subsection (1):— Provided that no such provision, shall be made unless at the same time the period before which the undertaking of the company affected becomes purchaseable is adequately extended.

The noble Lord said: My Lords, with regard to these two Amendments, which are alternatives, would ask the leave of the House to move an Amendment of which I have given the noble Viscount private notice, and which I understand is better drafted than the Amendments on the Paper, and meets the point in rather a different way. The Amendment is, in subsection (1), after "may," to insert "if, having regard to any change in the cost of electricity to the companies attributable to this Act, they think it expedient." The point of the Amendment is that the Electricity Commissioners should consider the very different position which these distributing companies hold from the power companies. The power companies have their position revised. According to Clause 30 the distributing companies would have to have a sliding scale, and my original proposal was that the revision should apply to all of them, but I understand that this new proposal is more satisfactory. It would be rather unfair to upset all the capital arrangements if some provision of this character were not made.

Certainly the matter would be still more difficult if a certain alleged pledge by the Attorney-General to which I called attention on the Committee stage was an actual pledge. I refer to what occurred on November 11, and appears in the House of Commons OFFICIAL REPORT, column 1356; but I am now told that that report was incorrect, and that it is going to be revised in the final edition of the OFFICIAL REPORT. It is as well that attention should be called to the fact that a pledge printed in the OFFICIAL REPORT has been incorrectly reported, and is not really a pledge.

Amendment moved— Clause 30, page 26, line 17, after ("may") insert ("if, having regard to any change in the cost of electricity to the companies attributable to this Act, they think it expedient")—(Lord Askwith.)

LORD GAINFORD

I hope the noble Viscount will accept the Amendment.

VISCOUNT PEEL

I will accept it, but I shall have to confirm what the noble Lord said about the misreporting of the words of the Attorney-General.

Clause 32 [Power to lop trees and hedges obstructing electric lines]:

VISCOUNT PEEL moved to insert, after subsection (5), the following new subsection: (6) Where for the purpose of the construction or maintenance of a transmission line it is necessary to fell any trees, this section shall apply to the felling of trees in like manner as it applies to the lopping of trees. The noble Viscount said: My Lords, this Amendment becomes necessary because of the Amendment I moved and your Lordships accepted upon the wayleaves.

Amendment moved— Page 28, line 22, at end insert the said new subsection—(Viscount Peel.)

LORD MONTAGU OF BEAULIEU moved, after Clause 32, to insert the following new clause:— Where the local authority object to the construction of an overhead electric line by the Board or any authorised undertaker on the ground that it will prejudicially affect the antiquarian or artistic value of villages, buildings, forests, woods, trees and lakes in their district, they may make representations to the First Commissioner of Works who may require the diversion of the line or the placing of the works underground.

The noble Lord said: My Lords, I notice that the noble Viscount has given Notice of an Amendment which deals more or less with the point that I raised in the Committee stage, but his Amendment is very circumscribed. We want to protect beauty spots all over the country from having great cables and standards erected in their midst. I think we have the sympathy of a very large majority of the outside public in this matter, and of the societies concerned in the preservation of beauty in this country. The noble Viscount's Amendment only goes a short way to meet our objection. For instance, he only schedules ancient monuments which are classified as such under another Act of Parliament. If the schedule is confined to those monuments you would leave untouched the question of amenities along the roads. It would be possible to put a great electric line in Richmond Park, the New Forest, or the Lake district, or any part of England which is now an absolutely priceless possession, and it seems to me that to confine the appeal to the First Commissioner of Works merely to the schedule under the Ancient Monuments Act makes the protection almost useless. I appeal to the noble Viscount to accept my Amendment either in its present or in a modified form.

Amendment moved— Page 28, line 26, at end insert the said new clause—(Lord Montagu of Beaulieu.)

VISCOUNT PEEL

My Lords, I think it would be too great a burden at the present time to place upon the First Commissioner of Works the power to require the diversion of a line or the placing of works underground. Being the present First Commissioner of Works myself I should in many ways be very glad to be able to order things in this commandeering fashion, but at present I am not sure that we in this country do value beauty so highly that we are ready to pay for it. Painful experience makes me pretty certain that we have not reached that altitude at present. But there are other technical reasons also why you could hardly put this duty on the First Commissioner, because he is not really equipped to take into account all the technical considerations which may arise as regards the diversion of lines and placing lines underground.

The noble Lord very justly observed that in the Amendment that I put down I confined the action of the First Commissioner to ancient buildings and ancient monuments. Of course, that covers a good range of buildings. I am not sure that my Amendment carries us very far, but I will explain why I am rather anxious that it should be accepted, although it is perfectly true that it may be in some ways unnecessary as the First Commissioner can often make representations, and does make representations already, to the Minister of Transport. That is almost common form. But, as First Commissioner of Works, I do rather value the point that under this Bill a statutory right is embodied in this Bill permitting, and even enjoining, the First Commissioner to make representations about possible damage that may be done to ancient monuments and ancient buildings by some very useful and practical operation. It shows, at any rate, that the Legislature has proclaimed that it is not indifferent to considerations of that kind.

My noble friend says that I have circumscribed it, and I have for this reason. As regards the beauty of forests and woods and lakes and so on—all matters, of course, which we are very anxious to preserve—there is power already to make representations in certain cases in Section 2 of the Act of 1919. The Minister of Transport already has to take into consideration the amenities, and. I think that under "amenities" all these questions to which my noble friend has alluded come in. Then, under Section 21, though the word "amenities" is not mentioned in it, the local authority has power to make protests and representations, and they no doubt will be moved, and are moved, by these societies to which my noble friend referred as well as by their own constituents to make vigorous representations on the subject. If I might put it on the lowest ground, a local authority which derives a good deal of money from some beauty spot in its area is not likely without struggle or protest to let that beauty spot be destroyed. We have a great many instances of that already. So I think those two points are safeguarded, and if your Lordships will allow me to leave it till later I think we shall give statutory expression to the protection of these ancient monuments, and I hope that will satisfy my noble friend to a certain extent.

LORD MONTAGU OF BEAULIEU

My Lords, I cannot say that I am satisfied, but one, of course must take what one can get in this House. At any rate, I know the noble Viscount is in sympathy with me. But I cannot see that the words he puts in will have anything more than a very limited application. They will not help our forests or the Lake district; but, as I say, we must take what we can get.

LORD MONK BRETTON

My Lords, is it not the case that if the noble Viscount puts his Amendment into the Bill in the form in which it stands he will be confining the matter to ancient monuments? The noble Lord, Lord Montagu of Beaulieu, and I are concerned as to the rural villages, and if your Lordships put ancient monuments into the Bill, cannot you put rural villages into it as well? After all, you are only putting in an enabling provision. If it becomes too expensive or is impossible owing to engineering difficulties it cannot be done. At any rate, I am not suggesting it should go to the full extent in regard to the woods and forests mentioned by my noble friend Lord Montagu; but we all know the villages and what the case would be if these great concrete posts that the noble Viscount has described were put in. Therefore I hope that he will be able to put into the Bill something of the sort we ask for and not leave it at ancient monuments. It will not matter to Stonehenge or to a tumulus scheduled under the Ancient Monuments Act. It will matter and it does matter, not only to the people who go through these villages, but, I venture to say, it will be very strongly felt by the villagers themselves.

THE LORD CHANCELLOR

Does the noble Lord press his Amendment?

LORD MONTAGU OF BEAULIEU

No.

Amendment, by leave, withdrawn.

Clause 33:

Protection of county bridges.

33.—(1) Nothing in this Act shall in any way limit or affect the powers of any county council (in this, section referred to as "the county council") to rebuild, alter, widen or repair the structure of any bridge upon which any work by this Act authorised shall be Constructed, or impose upon the county council any liability which was not by law imposed upon them prior to the commencement of this Act.

VISCOUNT FALMOUTH moved, at the beginning of the clause, to insert: (1) Unless and except so far as may be otherwise agreed between any county council (in this section referred to as 'the county council') and the Board the following provisions shall have effect (that is to say). The noble Viscount said: My Lords, this is quite a small Amendment; I do not know whether the noble Viscount is prepared to accept it or not.

Amendment moved— Page 28, line 27, at the beginning insert the said words.—(Viscount Falmouth.)

LORD EMMOTT had given Notice to move, in subsection (1), to leave out "county council (in this section referred to as the county council')" and insert "local authority (including for the purposes of this section a county council)." The noble Lord said: My Lords, on a point of order, may I ask whether if this Amendment is accepted it excludes mine? If it would do that I must move my Amendment now.

THE LORD CHANCELLOR

The noble Lord cannot move his Amendment on line 28 before we get to that line. We are on line 27 at the moment.

LORD EMMOTT

My Lords, there must be some method by which I can raise my point. I want to insert instead of the words "county council" the phrase "local authority (including for the purposes of this section a county council)." I should have thought on the face of it and as a matter of fact that this clause was hardly required because there is nothing whatever in the measure, so far as I can make out, to affect the powers of county councils or local authorities to rebuild or alter their bridges. But I raise no objection in principle to what the clause seeks to do. If this provision is to be carried I think it should refer to the bridges of all classes of local authorities. As it stands the clause would be construed, I think, as excluding bridges belonging to other local authorities from the protection it gives. I have only just found it out and I admit it is true that in Special Orders regarding electricity in the past there has been a common form clause dealing with bridges belonging to county councils, and I am told that no such clause has been applied to the bridges of local authorities. No other local authority, I think, has asked for such a clause, and the main reason for that is, of course, that most local authorities, at any rate the important ones, the county boroughs and so on, are themselves authorised undertakers.

But we are passing new legislation. We are setting up a Board with very special powers. We do not know what the requirements of that Board may be, and I think that all local authorities should be treated alike. In the case contemplated as to expenses, I think as between the local authority and the Board the expense in certain cases should be borne by the Board rather than by the local authority. I apologise for introducing this question at this moment, but it seemed to me that I should have been out of order in doing so later and, therefore, I thought it might be for the general convenience if I mentioned it now. I cannot move now, but I can put my case.

THE LORD CHANCELLOR

The noble Lord can move his Amendment as an Amendment to the Amendment.

LORD EMMOTT

Perhaps that is the simplest way of doing it, and I beg to move it as an Amendment to the Amendment.

Amendment to the Amendment moved— Leave out ("county council (in this section referred to 'as the county council')") and insert ("local authority (including for the purposes of this section a county council)")—(Lord Emmott.)

VISCOUNT PEEL

My Lords, I am going to make an appeal to my noble friend not to press this Amendment, because it brings in such a tremendous range of protest. I do not know what is included technically under the term "local authority." I suppose parish councils would come in. At any rate all the rural and urban authorities would come in, and they would be a very large number. There is always an objection in this House to an alteration in a model clause. This is a model clause giving certain rights to county councils, and I suggest it would be a great pity if this were altered. I do not think there is any real ground for altering it. I cannot see that by the operations of the Board any of these small bridges under the charge of district councils would be affected. I have explained the nature of the carriage of this electricity, and I do not think that a case has been made out for altering this model clause. If you did so your action would have great effect. Once you made a gap for these local authorities to rush in, they would find it necessary to rush in on every occasion and get the powers of the county councils. I hope the noble Lord will not press this and disturb the existing model clause.

LORD EMMOTT

My Lords, this was a new clause that was put in by this House on Committee stage. It will, therefore, go down as an Amendment to another place and there will be a chance of considering the matter there. I should be very much surprised if a considerable effort is not made to get it altered in the other House. I must remind your Lordships that one part of the scheme of this Bill is the provision of "grids" all over the country and the laying down of these "grids" may very often affect local authorities. There really is in new general legislation of this kind a case that is not in the least met by what the noble Viscount has said about model clauses. There is a real case for this to be applied to other local authorities. Were it not that I should hesitate to take up your Lordships' time any longer this evening I would press this to a Division, but I hope it will be taken up elsewhere.

Amendment to the Amendment, by leave, withdrawn.

On Question, Amendment negatived.

VISCOUNT PEEL moved to insert as a new subsection:— (5) In the application of this section to Scotland, the county council shall mean the county road board, or if the bridge is not wholly situated within one county, the joint bridge committee if such committee has been appointed. The noble Viscount said: My Lords, this Amendment is moved to put the matter right as regards Scotland.

Amendment Moved— Page 29, line 18, at end insert the said new subsection—(Viscount Peel.)

Clause 37:

Provisions as to companies with large area of supply.

37.—(1) Where after the commencement of this Act a special order is made authorising a company to supply electricity, and the area of supply is, in the opinion of the Electricity Commissioners, adequate in extent, the following provisions shall have effect with respect to the right of purchasing their undertaking:—

(c) The purchasing authority— (i) where the area of supply is situate wholly or mainly within the district of a joint electricity authority, shall be the joint electricity authority: Provided that if the area of supply is situate partly within the district of one joint electricity authority and partly in that of another, the right of purchase shall be exerciseable by such one of those Authorities, or shall be divisible between them as the Electricity Commissioners may determine;

(2) The Special Order in any case to which subsection (1) of this section applies may make provision as to the relation between the price charged for electricity and the dividends paid by the company or where the company to which any such Special Order is granted is a company carrying on one or more other undertakings, the relation between the price charged for electricity in the case of the undertaking authorised by the Special Order and the divisible profits on the capital attributable to that undertaking.

(3) Where under the Electricity (Supply) Acts, 1882 to 1922, or under any Order made thereunder, or under any deed et transfer executed in pursuance of powers conferred by any such Order, or under any special or local Act, any right to purchase the whole or any part of the undertaking of any authorised undertakers is vested in a local authority (including a joint electricity authority) the authorised undertakers may at any time within ten years before the date of purchase next occurring after the passing of this Act, or within ten years of any subsequent date of purchase enter into a contract with the local authority to amend, vary or alter the terms of purchase on the next occurring date upon which they may purchase upon conditions to be agreed between the parties with the approval of the Electricity Commissioners, and the terms of such agreement shall be binding upon the parties.

VISCOUNT PEEL moved, in subsection (2), to leave out all words from and including "dividends" and to insert "divisible profits on the capital attributable to the undertaking authorised by the Special Order." The noble Viscount said: My Lords, the abject of the Amendment is to reconcile the passage with a similar passage on page 26. It is merely drafting.

Amendment moved— Page 32, line 18, leave out from the first ("the") to the end of subsection (2) and insert ("divisible profits on the capital attributable to the undertaking authorised by the Special Order."—(Viscount Peel.)

LORD ASKWITH moved to leave out subsection (3). The noble Lord said: My Lords, this subsection (3) was moved as a subsection to the old Clause 37 (which becomes Clause 38) and has been printed in the wrong place. I am, advised by the Parliamentary draftsman that instead of coming as a subsection to Clause 38 it had better come as a new clause, and I shall so move.

Amendment moved— Page 32, lines 35 to 41, leave out subsection (3)—(Lord Askwith.)

LORD ASKWITH

I now move that this subsection (3) be inserted as a new clause after Clause 38. It has already been passed by the House and is only inserted as a new clause after Clause 38 for drafting purposes.

Amendment moved— After Clause 38, insert as a new clause the said subsection (3) deleted from Clause 37—(Lord Askwith.)

LORD ASKWITH moved, after Clause 38, to insert the following new clause:—

Notice of intention to purchase by purchasing authority.

"—(1) Where under the Electricity (Supply) Acts, 1882 to 1922, or under any Order made thereunder, or under any deed of transfer executed in pursuance of powers conferred by any such Order, or under any special or local Act, any right to purchase the whole or part of the undertaking of any authorised undertakers is vested in a local authority (including a joint electricity authority), the authorised undertakers may, at any time within seven years before any date when such undertaking or part thereof may be purchased or when notice may be given by the local authority requiring the authorised undertakers to sell such undertaking or part thereof, require the local authority to declare whether they intend to exercise their right to purchase.

(2) If the local authority notify to the authorised undertakers their intention not to exercise their right it shall not be exercisable at such date.

(3) If the local authority within six months of such requisition do not notify to the authorised undertakers their intentions with regard to the exercise of the right to purchase, or as a condition of not exercising their right, seek to impose terms which, in the opinion of the Electricity Commissioners are unreasonable, the Electricity Commissioners may suspend the right to purchase for such period and on such conditions as they think fit."

The noble Lord said: My Lords, this clause in regard to notice of intention to purchase by the purchasing authority is in direct fulfilment of a very strong recommendation by the Weir Committee in which they say, in regard to distribution companies: We find only one point in which we suggest that an alteration should be made. This relates to the purchase of undertakings by local authorities…It appears to us that the possibility of purchase at such short notice has the effect of sterilising the activities of the undertaker during the latter years of his franchise owing to his reluctance to sink capital in an undertaking which may be compulsorily purchased. We recommend that in the interest of electrical development this statutory right of purchase should be modified. They suggest a longer notice and that is embodied in the Amendment that I have put down on the Paper. It came on in another place on the Report stage and the Speaker held that it was out of order because it dealt with finance. The financial provisions are now left out, and the Amendment follows the Weir Report with regard to the extension of time. I beg to move.

Amendment moved— Page 33, line 25, at end insert the said new clause—(Lord Askwith.)

VISCOUNT PEEL

My Lords, my noble friend quotes the authority of the Weir Report, but I am not quite sure what is the value of this clause if the financial provisions are left out. I should like to say that the existing Acts and Special Orders already provide for prior notice of two years in the case of purchase. Now, my noble friend apparently wants to extend that up to seven years, which I think is a very long period. It is extremely difficult, I think, to see how a local authority could answer for the action of the second or third local authority which might come into being after it had itself perished. It would be very difficult for a Local authority to bind itself, or rather to bind successive local authorities, so far ahead as to what they should do, and if the matter came before the Electricity Commissioners I think they would have very great difficulty in coming to any decision upon it. How could they know the conditions five, six or seven years hence which would make it advisable or not advisable that the rights of expropriation of the local authority should be exercised? I think they would be in no better position than the local authority itself. Therefore I rather hope that my noble friend will leave the position as it is. I would suggest that two years is really quite long enough for a local authority to decide beforehand whether to exercise this particular right. I think it would be very difficult really to lengthen it to the extent my noble friend suggests.

LORD ASKWITH

My Lords, I would point out that it is only permissive. The clause says they "may" within seven years, and if the local authority say they do not want to do so then the undertakers would know where they were. If the local authority acted unreasonably then the Electricity Commissioners would have the right to intervene. But if my noble friend objects I do not desire to press the Amendment.

Amendment, by leave, withdrawn.

Clause 41 [Amendment of s. 21 of the Electricity (Supply) Act, 1919]:

VISCOUNT PEEL moved, at the end of the clause, to insert the following new subsection: (2) Where the Board or any authorised undertakers have in pursuance of powers conferred on them under Section twenty-two of the Electricity (Supply) Act, 1919, erected on any land supports for an electric line above ground, the Board or undertakers shall, for the purposes of Section eight of the Mines (Working Facilities and Support) Act, 1923, be deemed to be persons having an interest in the land on which such supports are erected. The noble Viscount said: My Lords, this new subsection will really only enable the Board to go to the. Railway and Canal Commission and ask for supports in a mining district. The Board have got to pay for them and they would naturally do that.

Amendment moved— Page 34, line 29, at end insert the said new subsection.—(Viscount Peel.)

VISCOUNT PEEL moved, at the end of the clause, to insert the following further new subsection: ( ) Where an application has been made to the Minister of Transport for his consent to the placing of any electric line above ground, and representations are made that the line will prejudicially affect any ancient monument within the meaning of the Ancient monuments (Consolidation and Amendment) Act, 1913, the Minister of Transport, in determining whether to give or withhold his consent, or to impose conditions, shall take into consideration any recommendations made to him by the Commissioners of Works with a view to preventing the ancient monument being prejudicially affected.

The noble Viscount said: My Lords, this is the new subsection to which I have alluded previously when we were discussing the question of advice to the Minister of Transport in the matter of ancient monuments. I agree that it really only puts into statutory form the present practice and if my noble friend who raised this matter thinks it would not add very much to what goes on at present I do not wish to press the Amendment. The Amendment cannot do any harm, I think, and therefore I move it, but if any noble Lord objects I do not wish to press it.

Amendment moved— Page 34, line 29, at end insert the said new subsection—(Viscount Peel.)

Clause 44:

Use for other purposes of electricity supplied for haulage or traction to railway companies, &c. 44.—Where any authorised undertakers may supply and are supplying within their district or area of supply electricity for haulage or traction to any company or authority being the owners or lessees of a railway, tramway, dock, harbour or canal undertaking situate partly within and partly without that district or area, such authorised undertakers may, subject to such limitations and conditions (if any) as the Minister of Transport may prescribe either generally or in any particular case, so supply electricity to be used for any purposes of such undertaking, whether within or without such district or area of supply, and such company or authority may, subject to such limitations and conditions (if any) as the Minister of Transport may prescribe either generally or in any particular case, use the electricity so supplied for any purposes of their undertaking for which the are entitled to use electricity.

LORD EMMOTT moved, after "may" where that word secondly occurs, to insert "with the consent of the Minister of Transport and." The noble Lord said: My Lords, I think it may be convenient to the noble Viscount in charge of the Bill and to the House if I deal quite briefly with the whole of the Amendments which I have put down to this clause. This is a new clause added in Committee and those for whom I am speaking do not like the clause at all. They consider that railway companies, dock companies and harbour companies already have powers which are adequate. Those powers, speaking generally, are that a railway company whose lines pass through several areas of supply can, with the consent of the Board of Trade (now replaced by the Minister of Transport) obtain a supply from the authorised undertakers in any one of such areas for use throughout their system for the purposes of traction and lighting of trains and stations. The existing law also provides that the Ministry of Transport may by Provisional Order (now a Special Order) authorise any authorised undertakers to supply electricity for the purpose of working or lighting railways. That is the law to-day.

For traction, therefore, the railway companies, with the consent of the Ministry of Transport, can obtain all they require or would get under this clause, but quite properly consent is not to be given by the Ministry without notice having been given to the other parties who are interested and without hearing those other interested parties in case they object. This clause would enact that a railway company or a dock company or a harbour company can use its supply of electricity taken from one authorised undertaker anywhere for all purposes, including even the lighting of shops let to outside tenants. Nowadays, of course, the railways quite properly, after obtaining Parliamentary sanction, build hotels and houses and shops and other buildings and let them to outside tenants. The Great Western Railway Company has a great building of flats and shops in Baker Street and I could give other instances. The principle of legislation as regards this matter has been that each authorised undertaker should be confined to his own area. Of course railway companies are an exception to that and I think quite properly so, but it is going altogether too far to allow, as this clause does, say, Marylebone to supply electricity for lighting shops in Westminster. That is really what could be done under this clause.

The Amendment which I have put down seeks to give the Minister of Transport a right of veto which he does not seem to have under this clause although he has the right of laying down limitations and conditions. It would also provide that notice of application must be given to interested parties and the Minister must hear them before he comes to his decision. As matters stand under this clause a local authority which was being prejudiced might never have a chance of being heard or of showing, as they might be able to show, that they could supply electricity more cheaply. Then again, the clause as I wish it altered would exclude lighting, except of course the lighting of trains, and I think that is only fair. It would also not allow a railway company to supply electricity taken from one local authority and supplied in the area of another local authority to tenants of theirs for the purposes of lighting and cooking. I think these are perfectly fair alterations and I beg to move.

Amendment moved— Page 35, line 25, after ("may") insert ("with the consent of the Minister of Transport and")—(Lord Emmott.)

VISCOUNT CHURCHILL

My Lords, I must on behalf of the Great Western Railway Company plead "Not guilty" to building shops and flats in Baker Street. It is another company, I think, to which the noble Lord refers. But, in any case, I hope your Lordships will not accept the Amendment. I understand that the noble Lord was speaking generally on all the Amendments standing in his name and I will deal with them. The position at the present moment is that the railway companies, by this clause, are subject in the use of electricity to conditions and limitations imposed by the Minister of Transport. I submit that this is surely sufficient safeguard on the points that he has mentioned. The Amendment is not very vital to this clause and, if the Ministry are content to be burdened with tie substantial amount of extra work (including, no doubt, additional staff) which the Amendment will impose upon them, I should not wish to divide the House on behalf of the railway companies. I submit, however, that these Amendments are wholly unnecessary.

The object of the clause, and the general spirit of the Bill, is to induce the railways to take the very large loads which they use in bulk from outside suppliers, whereas, with all the extra expenses that are necessary under the present conditions, the railways are not encouraged to do that but rather to increase their own supply or to start fresh supplies for fresh sections of their lines that they contemplate electrifying. If it is found that some addition to the clause would help matters, perhaps some such words as these might be added in another place:— Provided that no such supply shall, without the consent of the Minister of Transport, be given to or used by such company or authority for purposes of lighting, other than the lighting of vehicles or stations and other premises in the occupation of such company or authority. I merely suggest that something on those lines that would be considered by the other side might be inserted in another place.

VISCOUNT PEEL

My Lords, so far as I am concerned I should be content with an arrangement of that kind in the case of lighting, which, after all, is on a different basis from power. In reply to my noble friend Lord Emmott, who dealt with his Amendments generally, he is proposing to move to insert a proviso at the end of Clause 44 which, I may say at once, I should be prepared to accept. I think it is a very fair Amendment.

LORD EMMOTT

My Lords, I do not know that I quite understood the remarks of the noble Viscount, Lord Churchill. I did not hear what he had to say about the consent of the Minister of Transport, which is covered by the Amendment actually before the House.

VISCOUNT CHURCHILL

If I may speak again by leave of the House, my point was that I considered that the consent of the Minister of Transport under the present clause is quite sufficient safeguard.

LORD EMMOTT

So far as I am concerned, I very much desire that the consent of the Minister of Transport should be required. If he has the power to lay down limitations and conditions, he practically has the power to veto the whole scheme. Certainly he ought to have such a power, and that is all that I seek to obtain. I was very grateful to the noble Viscount, Lord Peel, for offering to accept one of the Amendments that I have put down, and I shall be very glad to move it when the time comes, but I do not quite understand what he desires to do about this Amendment, which I should really like to press.

VISCOUNT PEEL

It does not seem to me to be necessary to do that which is really the effect of this Amendment—namely, to make necessary the consent of the Minister before a railway uses electricity for these purposes. I was suggesting that it is not necessary to get the consent of the Minister in all these cases.

On Question, Amendment negatived.

LORD EEMOTT moved to add the following proviso:— Provided that— such company or authority shall not supply to any other persons electricity supplied to them under this section and such electricity shall not be used on any part of the premises of such company or authority which is not in their occupation.

The noble Lord said: My Lords, I have not before me the alteration suggested by the noble Viscount, Lord Churchill, and for my own part I will content myself with moving this Amendment.

Amendment moved— Page 35, line 35, at end insert the said proviso—(Lord Emmott.)

Clause 47:

Use for any purpose of electricity supplied to port, etc. authorities.

47. Notwithstanding anything contained in any Act or Order, electricity supplied by any authorised undertaker to any company, body or person owning or working an undertaking being a port, dock or harbour may be used for all or any of the purposes of such undertaking or any part thereof.

LORD EMMOTT moved to leave out Clause 47. The noble Lord said: My Lords, I do not desire to press this to a Division, but there is one point that. I should like to raise. This clause and Clause 44 distinctly overlap. They lay down different conditions for similar sets of circumstances. They were both inserted during the Committee stage and, in regard to Clause 47—though I had not the pleasure of being present during the late sitting of your Lordships' House in Committee—I think the noble Viscount, Lord Peel, said that he would accept the clause and let it go down to another place, where it might be properly considered. I should like to ask the noble Viscount what he has to say on that point, because obviously these two clauses overlap. Clause 47 was moved by the noble Lord, Lord Ritchie, with special reference, I suppose, to the Port of London. I think the Bill requires amendment in that respect, and I shall be glad if the noble Viscount can promise to give his attention to the matter.

Amendment moved— Page 37, leave out Clause 47—(Lord Emmott.)

VISCOUNT PEEL

My Lords, I must say that there is an appearance of overlapping in this clause. I think the clause does really apply to the special case of London, but I will have the point looked into.

Amendment, by leave, withdrawn.

Clause 49 [Interpretation]:

VISCOUNT PEEL moved, after the reference to "authorised undertakers" in subsection (1), to insert:— The expression 'local authority' shall include a joint board or a joint committee constituted in pursuance of section eight of the Electric Lighting Act, 1909. The noble Viscount said: My Lords, this is merely a drafting Amendment.

Amendment moved— Page 38, line 29, at end insert the said words—(Viscount Peel.)

First Schedule:

FIRST SCHEDULE.

Provisions as to the Acquisition of Generating Stations and Main Transmission Lines.

The price of a generating station or main transmission line shall be such sum as may be certified by an auditor appointed by the Electricity Commissioners to have been the amount of the expenses properly incurred on and incidental to the provision of the generating station or main transmission line, less depreciation on a scale fixed by Special Order:

Provided that if the owners of the generating station or main transmission line or the Board are dissatisfied with the sum so certified, the matter in dispute shall, in default of agreement, be determined by the arbitration of a barrister (or in Scotland an advocate) appointed by the Minister of Transport from the appropriate panel set up under section four of this Act, and the arbitrator may, if he thinks it expedient to do so, call in the aid of one or more qualified assessors and hear the case wholly or partially with the assistance of such assessors.

LORD BANBURY OF SOUTHAM moved to omit all words in the first paragraph after "Commissioners to" and to insert "be the value of the same as a going concern." The noble Lord said: My Lords, the effect of this Amendment would be to give the price of a generating station or main transmission line such sum as may be certified to be the value of the same as a going concern instead of the amount of the expenses properly incurred on and incidental to the provision of the generating station or main transmission line, less depreciation on a scale fixed by Special Order. I notice there that the scale of depreciation is, unless I am mistaken, to be fixed by the purchasers. The object of my Amendment is to give a fair price to the owner of the generating station or the main transmission line. Unless my Amendment or something similar is inserted, this is what would happen. A generating station, let us say, was built and equipped before the War at a cost of £50,000. The value of that station at the present moment would be at least £100,000, because it is well known to your Lordships that the cost of building and the cost of machinery have certainly doubled since the War. What would be the effect of this? Instead of getting the value of it as it is now they would get the cost at which it was built, less depreciation, and that might be possibly, not £100,000 as it is worth now, but only £20,000 or £30,000. I do not think that is the intention of the Government, and I am sure it is not the intention of my noble friend, but that might be the effect of it.

I do not know whether I have made my point clear. It is that the cost of buildings and plant have increased since the War and therefore the value cannot be ascertained on their cost less depreciation, because at the present moment they are worth much more than they cost. The result might be that a person, who had built a generating station a year ago which had cost him£100,000, would get £100,000less a year's depreciation, while someone, who had built a generating station, which is now worth £100,000, ten years ago at a cost of£50,000, would only get£30,000 or£40,000. My noble friend has only accepted one Amendment of mine, which was to insert the word "lawfully," which was an extremely good Amendment. In the circumstances—I have had some private conversation with him—I think he might accept the Amendment I am now proposing. It does not interfere with the Bill or with the Government's scheme; all it does is to give certain people who have certain property something like a fair price if it is acquired from them compulsorily.

Amendment moved— Page 40, Line 7, leave out from ("to") to the end of line 10 and insert ("be the value of the same as a going concern")—(Lord Banbury of Southam.)

VISCOUNT PEEL

My Lords, I am glad my noble friend recognises my generosity in accepting so large a proportion of the Amendments he has moved and I am much indebted to him. As regards this Amendment, I did have some private conversation with him and I hoped, as a result, that he would not have found it necessary to move the Amendment. The point is that it is suggested that it is not always fair to take over the generating station at the price of construction, etc, less depreciation, and that it ought to be taken over as a going concern, that is, I suppose, with the good will attached and so on. I would point out that really there is very little disturbance, practically no disturbance at all, to the operations of the company. They do not lose a single customer. On the contrary they probably increase their customers because, when customers find that they are getting the same article, or perhaps more of the same article, at a reduced price, they usually stick to the suppliers who give them such excellent terms. There fore their business goes on exactly as before. All that would happen would be that they would take their supplies from the Board at a cheaper price and therefore there is no good will attached and there is no loss to the company except the actual building. It does not seem to me to be necessary in that case to give anything beyond the value of the construction less so much for depreciation. That would meet the whole case. If you were paying for a going concern, paying for good will, you would be paying for something you did not acquire and compensating people for something they had not lost at all. I hope the noble Lord will not be disappointed if I do not add this second Amendment to the row of scalps he has already obtained.

LORD BANBURY OF SOUTHAM

There is something in what my noble friend says and possibly the words "as a going concern" may go a good deal further than they ought to. There is also a good deal to be said for the point I made. Will he accept "such sum as may be certified by an auditor, being the value at the time of purchase" I What I want them to get is the actual value and no more than the value. Under this Bill as it stands they will not get the value. Will he consider, instead of "a going concern," for he has converted me on that, the words "value at the time of purchase"? I suggest that is a very reasonable offer and I hope that he will accept it.

VISCOUNT PEEL

I thought I persuaded my noble friend that the actual sum properly expended, less sinking fund, was all the company could expect to get. They are not damnified. In fact, their position is improved by enlarging the number of customers, and to give them an additional bonus because of the change in the value of money, because that particular building could only be replaced at the particular moment for a larger sum than it cost when it was put up, would be giving them a bonus which would be unjustifiable to other consumers.

THE LORD CHANCELLOR

Does the noble Lord press the Amendment?

LORD BANBURY OF SOUTHAM

No, I do not press it. I am afraid success has rather turned my noble friend's head.

Amendment, by leave, withdrawn.

LORD ASKWITH moved to add to the first paragraph:—"and, in the case of a main transmission line, such additional sum as will compensate the owner for the severance of the line from the owner's undertaking." The noble Lord said: My Lords, my noble friend said on Committee stage:— Main transmission lines do not form part of the business of the authorised undertakers and, therefore the case would not arise; so I do not think it is necessary to make any provision for it. I am informed that London companies especially press strongly that my noble friend is not quite correctly informed and that it is extremely difficult to ascertain in many cases whether a line is a main transmission line which belongs to the authorities or not. If it does so belong, then if severance took place it has to have a sum paid over. The question would be, What is a main transmission line? and the definition given in Clause 49 is one of those definitions that so unpleasantly refer to another Act of Parliament: The expression transmission line, when used with reference to a line which is a main transmission line within the meaning of the Electricity (Supply) Act, 1919, shall include all such works as are mentioned in that definition.

I turn to the Act of 1919 and at Clause 36 I find that:— The expression 'main transmission lines' means all extra high-pressure cables and overhead lines (not being an essential part of an authorised undertaker's distribution system or the distribution system of a railway company or the owners of a dock undertaking) transmitting electricity from a generation station to any other generating station, or to a sub-station, together with any step-up and step-down transformers, and so on. The point that is made upon that is that you cannot tell whether a portion of an undertaking is really a main transmission line or not in the way it is defined by this Bill.

Take the big County of London Company's main transmission lines from Barking. They go to undertakings in London and elsewhere. Each of these undertakings—Finsbury and Holbon, Wandsworth, Camberwell, Croydon Rural District, etc—are separate undertakings under different Orders. The main transmission lines are not essential parts of the distribution system in either case, although they are essential parts of the County Company's system as a whole. Then there is a main transmission line connecting the Barking station of the County Company to the Brimsdown station of the North Metropolitan Power Company. This line is owned in part by each of the two companies. It is not an essential part of the distribution system of either company, but is used to enable either station to assist the other if required, under an agreement for mutual assistance. In those circumstances as these undertakings have different positions, and I am told that it is extremely difficult to say whether they are main transmission lines or not, I move that this alteration should be made. It would be much better really, I think, if the compulsory purchase of main transmission lines were dropped altogether. Under Clause 21 You allow the Board to lease or use such lines by agreement, and power to purchase by agreement might also be authorised.

Amendment moved— Page 40, line 10 at end insert ("and, in the case of a main transmission line, such additional sum as will compensate the owner for the severance of the line from the owner's undertaking"—(Lord Askwith.)

VISCOUNT PEEL

My Lords, I think that the idea suggested by my noble friend, that the severance of transmission lines is hardly likely to occur, is probably correct. As will be observed from the definition he read out, if a transmission line forms part of the distribution system of any undertaker it is not a main transmission line, and is extremely difficult to think of any line which can be called a transmission line which is not part of the distribution system of the undertaker. Therefore, this line would not be likely to be taken over. Supposing you had the case he mentioned, of a transmission line between two different generating stations, After all, if the generating station, or one of the generating stations, was taken over by the Board, then supposing in addition the transmission line was taken over, the transmission line would be performing exactly the same duties as it was before—it would be carrying electricity from the generating station, and the generating station would remain under the control of that particular undertaker. Therefore, in either hypothesis, if it is used purely as a transmission line or partly as a distribution line, I cannot see that there would be any damage done or any severance for which compensation ought to be applied. In the circumstances I really think the Amendment is not necessary.

LORD ASKWITH

I do not agree with the noble Viscount.

Amendment, by leave, withdrawn.

Second Schedule:

SECOND SCHEDULE.

Rules for Determining Cost of Production of Electricity at Selected Stations.

The cost of production of electricity at any selected station shall be ascertained by calculating the following costs, charges and allowances in respect of the year of account: (e) interest (exclusive of interest payable out of capital), on money properly expended for capita purposes (whether defrayed out of capital or revenue) and attributable to the generating station and the plant suitable to and used for the purpose of generating electricity therein, and interest on working capital properly attributable to the station and the product ion of electricity therein. The rate of interest for the purposes of this paragraph shall be—

1. (i) where the owners of a selected station are a joint electricity authority, or a local authority, the average rate payable on the money raised by the authority for the purpose;
2. (ii) where the owners of the station are a company, the average rate of dividends and interest paid by the company on their share and loan capital during the preceding year; so, however, that the rate shall in no case be less than five nor more than six and a half per cent. per annum.

LORD DANESFORT moved, in paragraph (e) (ii), to leave out "average rate of dividend and interest paid by the company on their share and loan capital during the preceding year; so, however, that the rate shall in no case be less than five nor more than," and to insert "rate of." The noble Lord said: My Lords, the point of this Amendment is this: When a company which owns a selected generating station sells compulsorily to the Board the electricity generated at that station, the price which the company will get from the Board for the electricity depends in part upon the rate of interest which is to be allowed to the company upon the capital which they have expended in equipping or improving that selected station. The Bill proposes that the rate of interest should vary between 5 per cent and 6½per cent. My Amendment proposes that this should be a uniform rate of 6½per cent.

I moved this Amendment in Committee, and I ant not going to trouble your Lordships by repeating the arguments which I then used, but may I remind your Lordships that in the Weir Report it was suggested that in a case like this the suitable interest was a uniform rate of 6½per cent. Moreover, in the debate in another place the Attorney-General, on a similar Amendment, is reported to have said that the Government thought that 6½ per cent was a fair average. There are many cases which I have worked out where the Government proposal of a variable rate would work grave hardship to the companies. I have given my noble friend a number of illustrations showing how hardly the Government proposal would work, especially on the owners of power stations.

I am not going to trouble your Lordships with the arithmetic, all the more because I understand that the noble Viscount has had my calculations examined and is satisfied that they are correct. May I tell you in a few words what is the effect of those calculations? Take the case of a selected station, to erect which money has been borrowed on loan, and the rest provided by share capital. The loan falls due and has to be paid off. The amount of interest that would have to be paid on the new loan to-day would be considerably greater than ten or fifteen years ago. The effect of a case like that, as I think I have satisfied my noble friend, would be that the company, when they sell their electricity to the Board, would only get such an amount as would pay them 4½per cent, in some eases, and in other cases less than 4½ per cent, on their ordinary share capital, although they might have been earning in the previous year 6 per cent. Surely that is not reasonable.

Take another case. Suppose a selected station and it becomes necessary to spend a largely increased amount of capital in improving it for the purposes for which the Board requires it. Cases will arise when the effect of the proposals in the Government's Bill will be this: When the company have expended all this extra money in raising further capital, in order to comply with the directions of the Board, they will only get enough money from the Board for the electricity supplied to pay 4½per cent on the ordinary share capital expended on this generating station, instead of, according to my illustration, 6 per cent which they had previously earned. Surely that is not reasonable, and I hope that my noble friend will accept this Amendment. I believe that 6½per cent all round would avoid any real hardship. If my noble friend is still as hard hearted as he has been in many other cases, and cannot accept the Amendment as it stands, would he be willing to accept it in this form, that, instead of giving a uniform 6½per cent on the capital in question he should allow the percentage to be from 54½to 64½instead of from 5 to 6½as the Bill proposes? I know it is difficult for him to come to a decision now, but I hope that he will consult his expert advisers, because I am told that if that concession is allowed, although it is far less than what many people think they are entitled to, it will remove many of the really undoubted cases of hardship that would arise under the Bill.

Amendment moved— Page 41, line 18, leave out from ("the") to ("six") in line 21, and insert ("rate of")—(Lord Danesfort.)

VISCOUNT PEEL

My Lords, my noble friend is always undaunted and undefeated, and he has returned to the attack on this question of the allowance. He has been good enough to send me a number of calculations and figures. I have studied them with great interest, and I do not quarrel with most of the figures he produced, but I did notice that in the first set of figures that he sent me after all these divisions have taken place he worked out the return at about 4½per cent. Of course, the minimum under this Bill is 5 per cent., and therefore the Bill gave him better terms than he had worked out. My noble friend, I think, noticed that he had worked it out at 4½per cent., and so he sent me another set of figures most ingeniously contrived to show that it worked out at more than per cent., and that he ought to have a minimum of 5½per cent.

I want to say two things about this. The first is that this particular percentage only applies to the amount of the electricity generated by the selected stations for the Board beyond the amount which they require themselves; it does not affect the cost of the electricity which they generate and buy back from the Board, because the same figures appear on both sides of the equation and therefore cancel each other out. Moreover, some of the figures taken by my noble friend seem to show that the owners were damnified because this calculation was made on the basis of the figures of the previous year, and he took several cases where the rate of interest or dividend had gone up in one year, and therefore (he said) it was rather hard to calculate this basis for cost of production on the figures of the previous year. But that would work both ways. It only works badly on the assumption that dividends are always rising. My experience of companies is that dividends are not always regularly rising from year to year, and as soon as they begin to fall, as they are bound to do, the compensating influence takes place, and the contrary effect follows when the man is having the figures calculated on the previous year when the interest was higher than it is in the existing year.

My noble friend has made a strong appeal to me about certain hard cases where the owners would suffer if they are kept within the strict limits of the 5 to 6½per cent. These figures in the Bill have been put forward as a very fair average. Averages, of course, cannot meet every case, but still the figures represent a substantial allowance in order to calculate the cost of production. Of course, I cannot resist the invitation of my noble friend to look into the matter again. I cannot promise anything, but possibly if I do look into it again my noble friend will withdraw his Amendment.

LORD DANESFORT

The noble Viscount has met me fairly enough. I beg leave to withdraw.

Amendment, by leave, withdrawn.

LORD ASKWITH moved, after paragraph (e) (ii), to insert:— Provided that in the case of any company which is a London company within the meaning of the London and Home Counties Electricity District Order, 1925, such average rate aforesaid shall be taken to be the average rate of the interest payable by the company and of the dividends which such company is entitled to retain or distribute in the year of account under the provisions of the London Electricity (Nos. 1 and 2) Acts, 1925, together with a proper proportion of any co-partnership benefit payable in such year under the said Acts or either of them.

The noble Lord said: My Lords, this Amendment is in reference to the London companies. There is a similar Amendment on the Third Schedule, also in reference to the London companies. These companies are authorised to pay dividends on a specified scale relative to the price of power. They are also authorised to set up co-partnership schemes, with a distribution to employees, also related to the prices charged. It is reasonable that the dividend items which are to enter into the cost of production and the cost of transmission should be the same on the capital employed as on the whole of the companies' capital. It has been suggested that as the standard of ordinary dividends in the company is to be reduced in 1931 from 10 to 7 per cent. the terms of this Amendment might be limited to that date, and I am authorised to say that the London companies would accept that alteration, and it would make a great deal of difference in the feeling they have towards the way in which they have been treated financially under this Bill.

Amendment moved— Page 41, line 22, at end insert the said proviso—(Lord Askwith.)

VISCOUNT PEEL

My Lords, I do not know that at this stage of the Bill I should be justified in accepting so substantial a change as is advocated by my noble friend. I did say on the Committee stage that I would have the matter further considered, but I submit that the London companies really must be placed on the same level as other companies, and that they should receive the average rate of interest paid, not exceeding 6½per cent. I see no case for differentiation. My noble friend seems to want to link up provisions contained in the London Act with respect to sliding scales with the provisions of this schedule, and this schedule deals with cost of production only. Clause 30 (2) recognises the London sliding scale, but I think my noble friend will see that it is very difficult to make any distinction between the London companies and other companies on the grounds that he has suggested.

LORD ASKWITH

I beg leave to withdraw.

Amendment, by leave, withdrawn.

Fifth Schedule:

FIFTH SCHEDULE.

Amendment of Schedule to the Electric Lighting (Clauses) Act, 1899.

S. 7.… In paragraph (1) for the words from "The undertakers shall carry" to the words "maximum rate of profit" there shall be substituted the following words: The undertakers shall apply the net surplus remaining in any year and the annual proceeds of the reserve fund when amounting to the prescribed limit— (d) in aid of the local rate: Provided that—

1. (i) the amount which may be applied in aid of the local rate in any year shall not exceed one and a-half per cent of the outstanding debt of the undertaking; and
2. (ii) after the thirty-first day of March, nineteen hundred and thirty, no sum shall be paid in aid of the local rate unless the reserve fund amounts to more than one-twentieth of the aggregate capital expenditure on the undertaking.

S. 20.… After the words "electric signalling communication," wherever they occur, there shall be inserted the words "or electrical control of railways.

LORD PHILLIMORE moved, in proviso (1), to leave out "outstanding debt of" and insert "aggregate capital expenditure on." The noble Lord said: My Lords, I should have desired to bring this Amendment forward on the Committee stage but your Lordships sat so late that I was enabled by the courtesy of the noble Viscount in charge of the Bill to raise it again upon the present stage. The object of the Amendment is a little to diminish the very considerable change that is made by Clause 40 and the Fifth Schedule of the Bill with regard to municipal corporations which have undertaken the business of supplying electricity. Clause 40 of the Bill and this schedule seem to an outsider hardly germane to the Bill, which after all, is a Bill for providing better and cheaper electricity.

This clause deals only with the relation of the distribution of profits between the ratepayer and the consumer. As the law now stands Section 7 of Ike Schedule to the Electric Lighting (Clauses) Act, 1899, runs in this way— …The undertakers shall carry the net surplus remaining in any year and the annual proceeds of the reserve fund when amounting to the prescribed limit, to the credit of the local rate as defined by the principal Act or at their option shall apply that surplus, or any part thereof, to the improvement of the district for which they are the local authority, or in reduction of the capital moneys borrowed for electricity purposes. Provided always that if the surplus in any year exceed five pounds per centum per annum upon the aggregate capital expenditure on the undertaking, the undertakers shall make such a rateable reduction in the charge for the supply of energy as in their judgment will reduce the surplus to that maximum rate of profit.…

If your Lordships would permit me to refer to the Fifth Schedule, for all that is substituted this: In paragraph (1) for the words from 'The undertakers shall carry' to the words 'maximum rate of profit' there shall be substituted the following words: The undertakers shall apply the net surplus remaining in any year and the annual proceeds of the reserve fund when amounting to the prescribed limit—

1. "(a) in reduction of the charges for the supply of energy; or
2. "(b) in reduction of the capital moneys borrowed for electricity purposes; or
3. "(c) with the consent of the Electricity Commissioners in payment of expenses chargeable to capital; or
4. "(d) in aid of the local rate:

Provided that—

1. (i) the amount which may be applied in aid of the local rate in any year shall not exceed one and a-half per cent of the outstanding debt of the undertaking; and
2. (ii) after the thirty-first day of March, nineteen hundred and thirty, no sum shall be paid in aid of the local rate unless the 1276 reserve fund amounts to more than one-twentieth of the aggregate capital expenditure on the undertaking."

That proviso makes three alterations in the present state of the law, and I may remind your Lordships that under Clause 40 this matter is not to apply merely to new municipal undertakings but is to alter the position of existing municipal undertaking and the existing rights of the ratepayers and of the corporations.

Of those three changes those who have approached me in this matter—the Association of Municipal Corporations—do not ask your Lordships to object to two. That proviso at the end about the reserve fund they submit to and the proviso reducing 5 per cent to 1½per cent they do not ask your Lordships to interfere with. What they do respectfully request is that the 1½per cent shall be calculated on the capital expenditure and not on the outstanding debt of the undertaking.

VISCOUNT PEEL

On the "aggregate capital expenditure." Those are the words.

LORD PHILLIMOHE

On the aggregate capital expenditure, quite true, and not on the outstanding debt of the undertaking. If you take a test of the outstanding debt of the undertaking, it really depends upon how a municipal corporation has managed its funds. As your Lordships know, all these debts are not permanent; they have to be paid off in instalments. Some municipal corporations have paid off their instalments more rapidly than they need with the result that they now have a very small debt. They will only get 1½per cent on that debt, while other corporations which have not paid any faster than they are compelled to will have 1½per cent on the residue of the debt that is left to them. I believe that Hampstead is the classical case. In Hampstead they have paid off a great deal more of their debt than they need have done, and the result is that in the event of there being a profit the ratepayers would get less benefit than they would if the comparison was made the other way.

This matter, I know, has been tossed backwards and forwards in another place, and I am not sure really whether it has been twice altered or once. But I know that the original proposal was as we ask your Lordships to make it now. Amongst other reasons, you are not to measure the liability of a corporation entirely by the residue of the debt. It might quite well happen, so I am informed, and from my knowledge of municipal matters I can well believe it, that a corporation might find itself carrying on at a loss. There may be some very large ratepaying company that goes bankrupt. I do not know whether your Lordships noticed the other day the case of the winding up of a company with assets of something like £900 at the suit of the Government for Excess Profits Duty amounting to a great many thousands. That is the sort of thing which may happen with a company. It may be carrying on at a great loss and one day be wound up and, as a large ratepayer, may be unable to contribute its rates. Or, again such a thing as the coal strike may make the cost of supplying electricity such that the authorised charge is not sufficient to enable it to pay. Therefore, it is submitted by those who have very much experience in these matters that it is a hardship upon the ratepayer and upon the corporation that this repayment, which, after all, is only at the rate of one and a-half per cent, should not be calculated upon the expenditure which the corporation has Incurred liability for and raised a very large sum by way of lean to meet, but upon the accidental and casual figure which is represented by the existing debt at the moment when the estimate has to be made. I beg to move.

Amendment moved— Page 45, line 32, leave out ("outstanding debt of") and insert ("aggregate capital expenditure on")—(Lord Phillimore.)

VISCOUNT PEEL

My Lords, I do not think my noble friend has stated the real principle which should guide the Government in considering whether the advantages of all these changes should enure to the consumer or whether they should enure to the ratepayer; that is to say, to the ratepayer qua ratepayer, because he may also be a consumer.

LORD PHILLIMORE

And very often not.

VISCOUNT PEEL

Yes, sometimes not. But in this case I think these changes brought about by the Bill have really been paid for by the consumers of electricity. After all they have to pay the interest and sinking fund on all this money raised for the changes of frequency, for the establishment of these great transmission lines and for the expenses of the Board. That being so, in my opinion—I am not speaking in this sense for the Government—the advantages ought also entirely to enure to these consumers, because they are simply getting what they have paid for. There does not, therefore, seem any cause for saying that the advantage should go to the ratepayer who really has not done anything towards this particular fall in price. I understand as it has been the custom in the past that there should be a possibility of carrying in aid of the rates certain sums from these undertakings, it is felt that it would be rather a severe change of policy if this advantage were taken away altogether from the ratepayer. Moreover, there may be cases where the local authorities have, in the past; contributed from the general rates to their electricity undertaking and in those cases it seems only fair that the ratepayers should get back what they have so contributed. That is the general way in which I approach it.

I do not think either of these schemes is a very good scheme, if I speak frankly, and I am not surprised that opinion in another place changed, being first in favour of one thing and then in favour of the other. Your Lordships will see that there is considerable objection to taking the aggregate capital expenditure, as the noble and learned Lord wishes us to do, and saying that the 1½per cent contribution to the ratepayers should be based on that aggregate capital expenditure, because that aggregate capital expenditure may obviously be constantly growing. Therefore 1½per cent carried to the ratepayers may amount to a considerable sum, though they do not necessarily deserve it, because it is simply owing to the growth of capital expenditure.

I think there is a good deal to be said against the proposal of the noble and learned Lord, and that it is better to leave the point as it stands in the Bill. I do not myself think that the proposal as it stands is a perfect suggestion. I think it is open to some of the criticisms made by the noble and learned Lord. After all, the percentage is to be levied on the reducing amount of the outstanding debt and when the outstanding debt is very small the percentage also will be very small, but then the whole of the advantage will enure to consumers. I think that is right, though neither scheme is very good. The objections to my noble and learned friend's suggestion are in my view a good deal stronger than are the objections to the scheme which he criticises; therefore I hope your Lordships will allow the Bill to stand as it is.

LORD EMMOTT

My Lords, I wish the noble Viscount in charge of the Bill would answer me this question. Why should the reserve fund of 5 per cent, which must be built up by March, 1930, be levied upon the aggregate capital expenditure? What is sauce for the goose is sauce for the gander, and if that reserve is to be on the aggregate capital expenditure and if, as is the case in Hampstead, 9/10ths of that aggregate capital expenditure has been repaid, why should a reserve fund of 5 per cent.—that is to say, if I calculate accurately et this late hour, half the sum remaining to be paid—be levied upon the aggregate capital expenditure before even one and a-half per cent, on the remaining £25,000 at Hampstead can enure to the benefit of the ratepayer? The noble Viscount has failed to look at the gross unfairness of this and the probable effect on the local authorities of such a proviso as is inserted here.

Take the unfairness. One local authority happens to have an enormous loan and has paid off very little. They can make a relatively large contribution to the rate. Another local authority that has managed well and paid off rapidly has only a very small amount in and can only make a very small contribution. There is no sort of fairness in the principle laid down in this Bill. I do not know very much about it, but if I understand the psychology of these local authorities they work harder and they manage better if they have some little plum of this kind. It should be only a little plum I admit. The old 5 per cent. on aggregate capital expenditure was too large, but if they have some inducement of this kind I think it tends to good management. On every one of these points I maintain that the Amendment moved by my noble and learned friend ought to be put into the Bill if only to give another place a chance of making up its mind properly. It has already spoken in both ways. If my noble friend goes to a Division I shall most certainly support him.

On Question, Amendment negatived.

LORD ASKWITH moved, after the references to Section 7, to insert: "S. 13—In subsection (1) the proviso shall be omitted." The noble Lord said: My Lords, this Amendment deals with boxes in the streets, and although I have put it down in my name, it was strongly pressed for by my noble friend Lord Gainford. The noble Viscount promised to look into the matter following upon the speech by my noble friend Lord Gainford. I would prefer to leave the chief argument to the noble Lord, Lord Gainford.

Amendment moved— Page 45, line 39, insert: ("S. 13…In subsection (1) the proviso shall be omitted")—(Lord Askwith.)

LORD GAINFORD

My Lords, as a director of the County of London Company, I may say that we have had a good deal of experience in making these boxes, and we have found that the borough councils very often refuse a company the opportunity of putting the boxes in at the street levels, which they often make free use of for their own current. The treatment of the companies is not at all fair, and it does seem to be right that private companies should have a similar right of erecting these boxes in the streets—a right that borough councils have for themselves. This thing really requires to be adjusted so that everybody should be treated alike. I therefore press the Amendment as a reasonable one. Under the Act of 1919 there is a safeguard granting an appeal to the Board of Trade. With that precaution I think the companies ought to have the same power as the borough councils.

LORD JESSEL

My Lords, I quite sympathise with what has been said about these boxes being placed in the streets by local authorities, but one wrong does not make a right. Everybody in London knows what a great obstruction to the streets these boxes are and the authorities are now trying to get rid of these obstructions in the streets. It would be a very bad thing in my opinion if the electricity companies were permitted to add to their number. Therefore I hope that the Government will refuse to allow this Amendment to be made. It does not apply merely to London but to the whole country. If you take away from local authorities the power to legislate for their own streets it would be a very retrograde step when we want our streets as free as possible.

VISCOUNT PEEL

My Lords, I am afraid there would be very great opposition indeed from the local authorities if I accepted this Amendment. They desire to be the judging authority in their own streets on the question as to what can be put up in those streets and I really think at this stage of the Bill it would be very difficult to—

LORD ASKWITH

I do not press the Amendment.

Amendment, by leave, withdrawn.

LORD ASKWITH moved, after the references to Section 7, to insert:— S. 14 … In paragraph 1 (a) after the words 'one month' there shall be inserted or in the case of service lines, seven days'".

The noble Lord said: My Lords, this Amendment would substitute for the notice of one month seven days in the case of service lines. A month would be a very long time to make a consumer wait before he could get anything done and although there have been attempts made by the local authorities lately to insist upon this one month it really is not wanted for practical purposes. I understood the noble Viscount to say that seven days was not given in any other Act. The Postmaster-General happens to have under Section 25 of the Electricity (Supply) Act of 1919 seven days' notice for service lines, though it would appear that no attention was then given to the month's notice allowed by Section 14 of the Clauses Act by local authorities and also by the Postmaster-General. In the 1919 Act it is perfectly clear that Parliament thought seven days' notice quite enough for these service lines. I suggest that seven days is a reasonable notice to be given all round.

Amendment moved— Page 45, line 39, insert the said word—(Lord Askwith.)

VISCOUNT PEEL

My Lords, I understand that the Postmaster-General has au objection to this Amendment, but if the noble Lord presses seven days I will not oppose it. It might go to another place where the Postmaster-General can restate his objections.

LORD GAINEORD

My Lords, I do hope this Amendment will be accepted because it is hard on consumers, when the lines are there and houses built and everything ready, that there should be a delay, sometimes of months.

LORD ASKWITH

I am much obliged to my noble friend for this piece of sugar which he has given me at the end of the Bill.

VISCOUNT PEEL moved to omit the reference to Section 20. The noble Viscount said: This is a purely drafting Amendment.

Amendment moved— Page 45, leave out lines 40 to 43—(Viscount Peel.)

LORD ASKWITH

My Lords, I would like to say that I am very glad the noble Viscount has moved the omission of these words to meet the Amendment I proposed on the Committee stage with reference to track circuits, a very important matter.

VISCOUNT HALDANE

My Lords, may I ask the noble Viscount if he can say when the next stage of the Bill will be taken?

VISCOUNT PEEL

On Friday, if that is convenient.