HL Deb 24 June 1930 vol 78 cc87-93

Clause 13, page 19, line 11, at end insert as a new subsection: ("(2) In the consideration by the Railway and Canal Commission of a scheme prepared by the Board of Trade under this section the following paragraph shall be substituted for paragraph (a) of the proviso to subsection (2) of Section seven of the Act of 1926 (which 41 relates to consideration of schemes by the Commission):— (a) shall not confirm a scheme unless satisfied—

  1. (i) that it would be in the national interest to do so, and
  2. (ii) in the case of an amalgamation scheme that the scheme—
    1. (a) will result in lowering the cost of production or disposal of coal, and
    2. (b) will not be financially injurious to any of the undertakings proposed to be amalgamated, unless the scheme contains provisions for the purchase, at a price to be fixed in default of agreement by arbitration, of any such undertaking; and
  3. (iii) that the terms of the scheme are fair and equitable to all persons affected thereby; and'").

The Commons disagree to the above Amendment for the following Reason:— Because it would hamper the proper exercise of the discretion of the Railway and Canal Commission.

THE MARQUESS OF SALISBURY

Subject to a small drafting Amendment I move that your Lordships do insist upon this Amendment. The important words to which I direct the attention of the House are on page 5 of the Amendment Paper, and in paragraph (a). Subsection (2) reads as follows:— (2) In the consideration by the Railway and Canal Commission of a scheme prepared by the Board of Trade under this section the following paragraph shall be substituted for paragraph (a) of the proviso to subsection (2) of Section seven of the Act of 1926 (which relates to consideration of schemes by the Commission):— These are the words which we propose should be enacted in order to guide the Railway and Canal Commissioners in their decisions upon these schemes, which include amalgamation schemes. The House will realise that the Railway and Canal Commissioners are a wholly different body from the Reorganisation Commissioners, whom we have reluctantly replaced in the Bill. The Reorganisation Commission is an ad hoc body, but the Railway and Canal Commissioners, of course, are not an ad hoc body, but a semi-judicial body, which has inspired the public with great confidence for many years. The Railway and Canal Commissioners of course appear in the Bill. They are the final authority upon the scheme. We have no distrust whatever of the Railway and Canal Commissioners, provided only they know the conditions upon which they are to arrive at a conclusion, and this Amendment states in clear terms the conditions which they have to bear in mind.

First of all they shall not confirm a scheme unless they are satisfied that it is in the national interest. That is in the Bill. Then comes the next condition, in the case of an amalgamation scheme, "that the scheme will result in lowering the cost of production or disposal of coal." That is to say, that it is not to be a theoretical but a commercial reason which guides the Railway and Canal Commission. They can only do it if it is actually going to lower the cost of production or disposal. We inserted that in order to prevent any wildcat schemes of amalgamation going through. Besides that we want to protect harassed interests. In case one amalgamated body will suffer financially much or at all by the amalgamation we want to protect it. So your Lordships, in Committee, put in these words: the Commissioners shall not confirm a scheme unless satisfied it will not be financially injurious to any of the undertakings proposed to be amalgamated, unless the scheme contains provisions for the purchase, at a price to be fixed in default of agreement by arbitration, of any such undertaking. That is to say, there shall be no injury done unless the particular injured undertaking is fully bought out and so compensated for any injury which may be caused to it. We think that if those two conditions are put into an amalgamation scheme, whether worked by the Board of Trade or as the Bill now stands by the Reorganisation Commission, a great deal will have been done to prevent the Bill from unfair operation. Lastly, there is the condition "that the terms of the scheme are fair and equitable to all persons affected thereby." That already is in the Bill. I beg to move that with the substitution of the words "submitted to" in the place of "prepared by," near the beginning of the new subsection, that this House doth insist upon its Amendment.

Moved, That this House doth insist upon the said Amendment, with the substitution of "submitted to" for" "prepared by" in line 2.—(The Marquess of Salisbury.)

LORD JOICEY

Lords, I confess that so far as I am concerned I have no belief whatever in these proposed schemes of amalgamation. I think that when people have developed large industries, employing thousands of people, put all their capital in them, and spent the greatest part of their lives in making them successful, and they are suddenly told that they must amalgamate with somebody with whom they want to have nothing to do, that is a most extraordinary position for Parliament to place anybody in. I should like to deal with some of these gentlemen who bring forward schemes of this sort. Of course, where a concern is almost bankrupt, and sees a very good business adjoining, it will naturally want to amalgamate; and surely the least you can do, if the Commissioners have the power to compel them to amalgamate, is to Gee that the other concern is protected in a reasonable way. I have no belief whatever in these amalgamation schemes. The power of compulsory amalgamation is one which Parliament has never given before. There has never to my knowledge been a compulsory amalgamation when people did not want it, and, so far as the industry is concerned, you will find precious few cases in which there will be any economic saving by amalgamation. The probability is that, instead of costs being-decreased, they will be increased. I think there will be a great many surprises when this Bill comes into operation. But I think that you ought to give any protection that is possible to those who are compulsorily amalgamated; and on that ground shall support the position taken up by the noble Marquess.

LORD THOMSON

My Lords, I think the House ought to realise that the small Amendment introduced by the noble Marquess is really rather fundamental. Altering the words "prepared by" to "submitted to" the Board of Trade means that all schemes will come under this Amendment. That, I think, is the deduction from that alteration of words.

THE MARQUESS OF SALISBURY

The reason why we are striking out the words "prepared by" the Board of Trade is that, your Lordships having agreed to replace the Board of Trade in the main part of the Amendment by the Reorganisation Commission, the scheme will no longer he prepared by the Board of Trade, and therefore we put in the words "submitted to" instead.

LORD THOMSON

That covers all schemes of arty sort or kind?

THE MARQUESS OF SALISBURY

Yes.

LORD THOMSON

But that is in the Government Bill, I think. I think I must admit that the noble Marquess is right on that. I did not understand the actual history of this Amendment in this connection.

THE MARQUESS OF SALISBURY

I think it is so. I hope I am not misleading the noble and gallant Lord.

LORD THOMSON

As regards the main purpose of the Amendment I submit that it is undesirable, and, if it is not undesirable, it is unnecessary. After all, the Railway and Canal Commission is a very important body, almost part of the High Court. It does not consist of simple-minded folk who would be easily imposed upon, bat of people who under this Bill are given powers of deciding certain large matters—and the larger their powers and the greater the discretion left to them the better in the opinion of the Government. Instead of that, this Amendment really limits their discretion. It specifies certain points—not all the points—they have to consider. The Railway and Canal Commission will have to consider a vast field of facts brought before them in connection with the scheme; but, by specifying certain given points in the terms of the Bill, by implication one rather belittles the other points, which are equally important. That is the line on which the Government opposed the Amendment on the Committee stage; that is what still remains our principal objection—namely, that it does limit the discretion of a very responsible body, the Railway and Canal Commission, and specifies certain points for their consideration, and therefore by implication belittles and renders of less importance other equally important points.

THE LORD CHANCELLOR

My Lords, I propose to put this Amendment to the House—that the words "submitted to" be inserted instead of "prepared by" in the second line.

On Question, Whether the words "submitted to" shall be inserted instead of "prepared by"?

Their Lordships divided:—Contents, 188; Not-Contents, 26.

CONTENTS
Argyll, D. Ypres, E. Gifford, L.
Bedford, D. Glentanar, L.
Marlborough, D. Bertie of Thame, V. Greenway, L.
Rutland, D. Brentford, V. Greville, L.
Sutherland, D. Chaplin, V. Hampton, L.
Wellington, D. Churchill, V. Hare, L. (E. Listowel.)
De Vesci, V. Harlech, L.
Abergavenny, M. Devonport, V. Harris, L.
Camden, M. Elibank, V. Hastings, L.
Lansdowne, M. Falkland, V. Hawke, L.
Linlithgow, M. FitzAlan of Derwent, V. Heneage, L.
Normanby, M. Goschen, V. Howard of Glossop, L.
Sailsbury, M. Hailsham, V. Hunsdon of Hunsdon, L.
Winchester, M. Hambleden, V. Illingworth, L.
Zetland, M. Hill, V. Joicey, L.
Hood, V. Kenlis, L. (M. Headfort.)
Albemarle, E. Novar, V. Kenmare, L. (E. Kenmare.)
Ancaster, E. Sidmouth, V. Kylsant, L.
Bathurst, E. Sumner, V. Lawrence, L.
Beatty, E. Ullswater, V. Leconfield, L.
Bradford, E. Leigh, L.
Clarendon, E. Aberdare, L. Lloyd, L.
Cranbrook, E. Aldenham, L. Luke, L.
Denbigh, E. Alvingham, L. Melchett, L.
Doncaster, E. (D. Buccleuch and Queensberry.) Ampthill, L. Methuen, L.
Annaly, L. Mildmay of Flete, L.
Dudley, E. Annesley, L. (V. Valentia.) Monk Bretton, L.
Feversham, E Armstrong, L. Monkswell, L.
Fitzwilliam, E. Arundell of Wardour, L. Monteagle, L. (M. Sligo.)
Fortescue, E. Askwith, L. Mountgarret, L. (F. Mountgarret.)
Grey, E. Auckland, L.
Halsbury, E. Balfour of Burleigh, L. Mowbray, L.
Harewood, E. Banbury of Southam, L. O'Hagan, L.
Iddesleigh, E. Bayford, L. Oriel, L. (F. Massereene.)
Ilchester, E. Berwick, L. Ormathwaite, L.
Incheape, E. Biddulph, L. Ormonde, L. (M. Ormonde.)
Iveagh, E. Brancepeth, L. (V. Boyne.) Ponsonby, L. (E. Bessborouoh.)
Jellicoe, E. Brownlow, L.
Lauderdale, E. Carson, L Rayleign, L.
Lindsay, E. Clanwilliam, L. (E. Clanwilliam.) Redesdale, L.
Lindsey, E. Ritchie of Dundee, L.
Lucan, E. [Teller.] Clifford of Chudleigh, L. Rossmore, L.
Roundway, L.
Lytton, E. Clinton, L. Russell of Liverpool, L.
Macclesfield, E. Conyers, L. Sackyille, L.
Malmesbury, E. Cottesloe, L. St. John of Blesto, L.
Mar and Kellie, E. Cullen of Ashbourne, L. Saltoun, L.
Midleton, E. Cushendun, L. Sandys, L.
Minto, E. Danesfort, L. Sinclair, L.
Morton, E. Darling, L. Somerleyton, L.
Mount Edgeumbe, E. Dawnay, L. (V. Downe.) Southampton, L.
Onslow, E. Deramore, L. Stafford, L.
Peel, E. Desart, L. (E. Desart.) Strachie, L.
Plymouth, E. Desborough, L. Stratheden, L.
Powis, E. Dyneyor, L. Sudeley, L.
Rosslyn, E. Dulverton, L. Swansea, L.
Sandwich, E. Elphinstone, L. Sydenham of Combe, L.
Scarbrough, E. Erskine, L. Templemore, L.
Selborne, E. Fairfax of Cameron, L. Teynham, L.
Spencer, E. Fairhaven, L. Thurlow, L.
Stanhope, E. Faringdon, L. Trenchard, L.
Stradbroke, E. FitzWalter, L. Vivian, L.
Vane, E. (M. Londonderry.) Forester, L. Waleran, L.
Wharncliffe, E. Foxford, L. (E. Limerick.) Wavertree, L.
Wicklow, E. Gage, L. (V. Gage.) [Teller.] Weir, L.
Yarborough, E. Cainford, L. Wharton, L.
NOT-CONTENT.
Sankey, L. (L. Chancellor.) Mersey, V. Hemphill, L.
Marley, L. [Teller.]
Parmoor, L. (L. President.) Amulree, L. Meston, L.
Arnold, L. Passfield, L.
Reading, M. Ashton of Hyde, L. Ponsonby of Shulbrede, L.
Buckmaster, L. Shandon, L.
Beauchamp, E. Clwyd, L. Stanmore, L.
De La Warr, E. Denman, L. Sudley, L. (E. Arran.)
Russell, E. Doverdale, L. Thomson, L.
Hay, L. (E. Kinnoull.) [Teller.] Wargrave, L.
Astor, V.

On Question, Amendments to the Amendment agreed to.

Resolved in the affirmative and Amendment agreed to accordingly.

THE LORD CHANCELLOR

My Lords, the effect of that is to take out the words "prepared by" and -gut in the words "submitted to." Therefore, the Motion that I have now to put to your Lordships is that this Amendment be insisted upon; that is the Amendment which contains the words "submitted to" instead of the words "prepared by."

On Question, Motion agreed to, and Amendment, as amended, insisted upon accordingly.