COAL MINES BILL.

HL Deb 14 May 1930 vol 77 cc593-662

House again in Committee (according to Order):

[The EARL OF DONOUGHMORE in the Chair.]

Clause 5:

Committees of investigation.

(6) If after investigating any complaint made with respect to the operation of a scheme, a committee of investigation is of opinion that any provision of the scheme is contrary to the public interests, it shall be the duty of the committee to report the matter to the Board of Trade, and if, after considering the report and consulting such persons as appear to them to be affected, the Board agree with the opinion of the committee, the Board shall make recommendations to the council or executive board charged with the duty of administering the scheme, with a view to the rectification of the matter complained of.

The Board of Trade may hold inquiries for the purpose of assisting them to consider any report made to them under this subsection by a committee of investigation in like manner as they are empowered under Section twenty-two of the Mining Industry Act, 1920, to hold inquiries for the purposes of that Act, and that section shall apply with respect to inquiries held by the Board under this subsection accordingly.

(8) If after investigating any complaint made with respect to the operation of a scheme, a committee of investigation is of opinion that any act or omission of any persons in respect of their functions under the scheme is having or is likely to have an effect contrary to the public interests, it shall be the duty of the committee to make representations with respect thereto to t[...] persons having power under the scheme to rectify the matter, and if, upon such representations being made, the matter is not dealt with to the satisfaction of the committee, the committee may refer the matter to a single independent arbitrator to be appointed by agreement between the committee and the body charged with the duty of administering the scheme, or, in default of agreement, by the Board of Trade, and the persons having power under the scheme to give effect to the decision shall comply therewith and exercise their functions under the scheme in conformity with the decision.

THE EARL OF HALSBURY moved, in subsection (6), after "interests," to insert "or is unfair or inequitable in its operation." The noble Earl said: I have down on the Paper three Amendments on this clause, but they all really come down to the same point. Therefore I do not think it is necessary to divide them up. Subsection (1) constitutes a national committee of investigation, consisting of nine members, to be charged with the duty of investigating any complaint made with respect to the operation of the central scheme. Then you have in the same subsection provision for the appointment of district committees, consisting of five members, charged with the duty of looking into the district schemes, to see whether there is any hardship in any matters connected with them. Then look at subsection (2):— The chairman and other members of every committee of investigation shall be persons appointed by the Board of Trade. That is a rather bureaucratic suggestion, but one to which I am not going to take any objection. People have considered this question. They have considered whether or not that is advisable. They have come to the conclusion that it is, and I am not going to attack it.

But when you come to subsections (3) and (4) you still find the Board of Trade; so that it is a very bureaucratic clause from beginning to end. The same may be said of subsection (5). Now we come to subsection (6). Having said that, I am going to accept the idea, after considerable investigation, that the bureaucratic Board of Trade should be allowed to govern this clause. We now come to a point which I think is very important, and it is the whole inwardness of my Amendment. The clause says:— If after investigating any complaint made with respect to the operation of a scheme, a committee of investigation is of opinion that any provision of the scheme is contrary to the public interests, it shall be the duty of the committee to report the matter to the Board of Trade. Then it goes on to say that after considering the report the Board of Trade may take steps to prevent that provision of the scheme going through.

My objection is that they cannot use the operation of subsection (6) unless it is contrary to the public interest. There may be very hard cases. The action of the committee of investigation in such a case may perhaps not be against the public interest, but it would hit the individual extremely hard. I do not suggest that they should be compelled to consider a private interest if on the whole they think it would be against the public interest to do so. But as this clause is drawn they have no power in any circumstances whatever to refuse what is ordered in this clause, unless it is against the public interest, wholly leaving out any particular case about which they would like as sensible men to say: "After all, this is an exceptional case, and we ought not to be made to follow the words of the Act."

Therefore what I have suggested is, I think, a very innocuous proposal. It is that as well as the public interest they are entitled—not bound—to take into consideration whether what is proposed is "unfair or inequitable in its operation." I am not wedded to the words of the Amendment, and if noble Lords opposite would like to put in such words as "contrary to principles of ordinary justice," I would accept them. I should not be in the least happy, after some considerable experience with the Courts and the interpretation of these Acts, if I were merely told by the Government that of course it would be against the public interest that any individual should be hampered. It does not seem to me that that would be either in accord with many judgments I have heard or some of the speeches that I heard last night. I gather that the whole idea is that the individual has to be sacrificed to the public interest occasionally, and I accept that. Obviously it must be so. But at least, when we have a tribunal which has to consider this question, do allow them, if they wish, to look to the interests of the private person concerned.

Amendment moved— Page 12, line 17, after ("interests") insert ("or is unfair or inequitable in its operation").—(The Earl of Halsbury.)

THE SECRETARY OF STATE FOR AIR (LORD THOMSON)

I think that the noble and learned Earl has rather misconceived the purpose of this whole clause. If his intention in making this Amendment is to say that something is unfair and inequitable in the public interest, I think that point is already covered by subsection (1), which says that:— There shall be constituted a national committee of investigation consisting of nine members, which shall be charged with the duty of investigating any complaint made with respect to the operation of the central scheme, and there shall also be constituted for every district a district committee of investigation consisting of five members, which shall be charged with the duty of investigating any complaint made with respect to the operation of the district schemes …. This committee of investigation is set up to provide a court of appeal, so to speak, for consumers and the public generally. It consists largely of representatives of the consumers. The composition of the investigation committee is given in the clause. In addition to the Chairman appointed by the Board of Trade, exactly half of the members are representatives of the consumers.

THE EARL OF HALSBURY

Appointed by the Board of Trade.

LORD THOMSON

Appointed by the Board of Trade, but appointed from representatives of the consumers. If the noble and learned Earl is dealing with the general case of any individual who suffers from the operation of the scheme and he wishes in the public interest to add these words to the other words which appear in the clause, he is only doing something unnecessary because all those cases of complaint are covered by subsection (1).

THE EARL OF HALSBURY

I really do not want to interrupt, but will the noble Lord look at subsection (1). Subsection (1) is only the appointment of somebody to investigate something. After you have got the investigation, you have to look at what they can do after they have investigated and then you have to go to subsection (6), which gives the first idea of implementing their investigation. Who on earth wants things investigated by people who, having considered them, cannot do anything? It is subsection (6) that matters.

LORD THOMSON

The committee of investigation investigates all these complaints by consumers and is representative of the consumers.

THE EARL OF HALSBURY

Certainly.

LORD THOMSON

And, therefore, sympathetic to them.

THE EARL OF HALSBURY

Very likely.

LORD THOMSON

If the noble and learned Earl is putting this Amendment forward with a view to assisting, we will say, disputes between coal owner and coal owner or executive board and executive board, those are all provided for under other sections of the Bill—for example, by arbitration as between one coal owner and another. The noble and learned Earl is not referring to those?

THE EARL OF HALSBURY

Not in the slightest. I am referring to subsection (6) and subsection (6) alone. All I want to know is this. After investigating any complaint made with respect to the rest of the clause, have the committee any power to consider whether or not, to put it in ordinary language, a hard case ought to be taken in? At present they cannot do that. They have simply to do one thing—to look at the public interest apart from the individual case.

LORD THOMSON

But I submit if you are looking to the public interest, and you provide a committee of investigation, consisting as to half of its membership of consumers under the chairmanship of an independent Chairman appointed by the Board of Trade, you have provided a very impartial tribunal.

THE EARL OF HALSBURY

But they cannot act.

LORD THOMSON

I do not quite see how the noble and learned Earl's Amendment would afford protection to the ordinary member of the public. Surely, in the interests of the public, the treatment should be fair and equitable. This is a consumer's committee very largely.

THE EARL OF HALSBURY

As to half of it.

LORD THOMSON

With an independent Chairman, half its members representing the consumers and a quarter, apart from the Chairman, representing the coal owners and a quarter representing the coal miners. I submit that really this is covered by the Bill as it stands. Of course, if the other point is not intended to be raised, it is no good my dealing with it. If we are really narrowed down, in other words, to the issue as to whether any member of the public is sufficiently covered by this Bill, I submit, with all diffidence, in spite of a difference of opinion with two noble and learned Lords, that he is covered and I am advised to that effect.

VISCOUNT HAILSHAM

I hope that my noble and learned friend Lord Halsbury will press this matter to a Division. The noble Lord who has just spoken on behalf of the Government seems to me to have failed entirely, if he will forgive me for saying so, to apprehend what is the purpose or the effect of the Amendment. I hope your Lordships will permit me to indicate what the position is, because it seems to me to be a matter of really grave importance from the public point of view. It is perfectly true, as the noble Lord has said, that in the earlier clauses of this Bill provision is made to meet the case of coal owners who think themselves aggrieved by a scheme. As I understand this Bill, Clause 5 does not deal with complaints by coal owners against coal owners. They are dealt with in the earlier clauses. But Clause 5 is the only clause which provides any sort of protection to the consumer, and it is the consumer on whose behalf I am making these representations.

I am not for the moment interested in disputes between coal owners or between owners and wage earners. What I am interested in is the position of the consumer of coal in this country under this Bill. Clause 5 purports to give him protection, and the protection it gives him is this. It sets up, first of all, a committee of investigation which, in the case of the districts—I take them for simplicity—consists of five members: one independent Chairman, two purporting to represent the industry (the coal owners and coal miners) and two purporting to represent the consumers, all appointed by the Board of Trade. As the noble Lord has said, any complaint has to be investigated by that body. But it is no use investigating a complaint unless you have power to do something if you are satisfied that the complaint is justified. Having investigated the complaint, which is what they have to do under subsection (1), then under subsections (6) and (8) we get what powers they have.

Your Lordships will find that if they investigate a complaint that a particular man is being unfairly treated or a particular class of people is being unfairly treated, unless they can certify that what is being done is contrary to the public interest they have no power either to afford redress or, indeed, to make any report at all. Let me give an illustration. Supposing that they should find that a gas company was being charged a price which was very excessive for its fuel with the object of compelling the consumers to buy coal and give up their gas heating. Unless they were satisfied that this was contrary to the public interest they could not make a report that the complaint was well founded, however gross the excess was. If they found, for instance (I am only taking perfectly hypothetical cases) that the scheme provided that the consumers in one part of England, on one railway system for example, were better treated than the consumers in another part of the country, on another railway system, they might find that that was unfair on the people in one district as compared with the other; but unless they could report that it was contrary to the public interests they could not report that a complaint was made out, and they could take no steps to remedy the injustice.

It does seem to me that the Government are in this dilemma. Either they must say that what is unfair or inequitable is contrary to the public interests, and if they say that then there is no possible harm in putting these words in, because they only make clear the intention; or they may say they intend that people shall be subjected to unfairness and inequitable treatment, and shall be deprived of any remedy. If they say that then I should ask your Lordships to say that the Government are wrong and they ought to be compelled to do this. There is that dilemma—either "contrary to public interests" does cover every ease of unfairness and inequitable treatment, in which case there is no harm in putting in these words, or the phrase does not, in which case they are depriving people of all remedy when unfairly treated. I hope the noble Earl, Lord Halsbury, will press this matter, if the Government do not give way, which, of course, is a more agreeable way of achieving our end. I hope your Lordships will insist that the consumer shall be given some sort of protection against what I submit is a very great hardship which he risks under the Bill as it is drawn.

LORD THOMSON

I quite see the point so cogently put. May I suggest a compromise? Subsection (8) of the clause states:— … after investigating any complaint made with respect to the operation of a scheme …. it shall be the duty of the committee to make representations with respect thereto to the persons having power under the scheme to rectify the matter, and if, upon such representations being made, the matter is not dealt with to the satisfaction of the committee, the committee may refer the matter …. I suggest that instead of "may" the word "shall" should be put in if that would meet the noble Lord.

VISCOUNT HAILSHAM

It is not my Amendment, but may I point out that it does not begin to meet the point, because if the noble Lord had not omitted—I am not suggesting anything improper—the vital words your Lordships would have seen the same limitation is in subsection (8) as in subsection (6). The words are these:— If after investigating any complaint made with respect to the operation of a scheme, a committee of investigation is of opinion that any act or omission of any persons in respect of their functions under the scheme is having or is likely to have an effect contrary to the public interests, it shall be the duty of the committee to make representations. The same limitation occurs in subsection (8) as in subsection (6). They have no powers to refer. They cannot refer or report unless they are satisfied the thing is contrary to the public interests. They cannot do anything if they come to the conclusion that the scheme is unfair or inequitable to any consumer or any class of consumers, unless they are able to go on and say the particular unfairness is contrary to the public interests. That is the objection which, as I understand it, my noble friend is trying to cover, and that objection is not met by the noble Lord's suggested compromise.

THE EARL OF HALSBURY

I should like to apologise to the noble Lord opposite for my remissness. It was entirely owing to my perhaps bad speech in which I introduced my Amendment that I did not call attention to subsection (8), page 13, line 24. I made the perhaps excusable mistake that I had assumed that he had not only read the Bill before us but had done me the honour also to read the Amendments I put down.

THE MARQUESS OF READING

As far as I can gather there does not seem to be any division of opinion on the matter under discussion. I would suggest to the Government that this is a comparatively small matter—an Amendment introduced for the purpose of meeting a possible hardship which undoubtedly may exist, as has been pointed out. I agree entirely with what has been said by my noble and learned friend Lord Hailsham. All we want is to protect the consumer. The clause was introduced for that purpose, but the words do not give effect to it. They are not really sufficiently wide. Those who are familiar with the interpretation which must be put on the words "contrary to the public interests" would see there is a limitation upon them which does not extend so as to meet the points made by my noble friend Lord Halsbury. I suggest to the Government that the words themselves do not really carry out sufficiently what is intended, and I think they may afterwards or now suggest some other words that would do so. Obviously it is desirable in a Bill of this kind, which must hit the consumer, that protection should be given him in as wide a sense as can possibly be devised, consistently with the principles of the Bill.

LORD CARSON

I think the noble Earl, Lord Halsbury, was right in calling attention to the second Amendment in relation to the proposal that was made by the noble and gallant Lord opposite (Lord Thomson). Lord Halsbury saw that the object he has in view could not be carried out unless subsection (8), in line 24 of page 13, had the same words added—namely, "or is unfair or inequitable," and therefore the proposal that is made by the noble and gallant Lord, with all respect to him—I am sure he made it in a perfectly genuine and bona fide way—really gives nothing at all. It leaves the matter exactly as it was. I cannot but think, as the noble Marquess, Lord Beading, has just said, that this is a comparatively small point. The words "contrary to the public interests" might in many cases include the rights of an individual—I mean an individual colliery might be of such importance to the industries around it that that might be a matter contrary to the public interests, but it may not influence a smaller case, it being a question of degree. Are the Government really going to let it go forward that they refuse, under such drastic changes as are being made by this Bill, to allow any consideration whatsoever to be given to what is unfair or inequitable in these schemes? If they are going to announce that publicly as their policy it is a very strange thing.

But it does not end there. Even when the committee come to the conclusion that it is unfair or inequitable within the meaning of the Amendment, it has then to go to the Board of Trade. The Board of Trade then consults such persons as appear to them to be affected—which seems to be a very proper course to take—and then, if they agree with the opinion of the committee, the Board make the recommendation that the matter shall be reconsidered with a view to rectification. Could anything be more fair or proper in a scheme of this kind? If the Board of Trade come to the conclusion that this is merely some whimsical proposition put forward without substance they will pay no attention to it, and decline to agree with the committee, and the scheme will go through. I suggest to the noble Lord that is not really a big matter, and that he might very well, in a spirit of conciliation, say that the committee might consider any case of unfairness or inequitable treatment.

LORD THOMSON

After the overwhelming array of talent brought to bear upon this Amendment, I feel it would be very ill-advised of me to resist. The object of the framers of this Bill was that in this particular Part the coal owner anyhow should be excluded because he is already provided for. I wonder if it would meet the view of the noble Earl, Lord Halsbury, if we added to his proposed Amendment the words "on the consumer"? That is to say, that we should insert "or is unfair or inequitable in its operation on the consumer "or" any consumer "or words to that effect.

THE EARL OF HALSBURY

Perhaps the noble Lord would consent to a further compromise. Would he allow me to withdraw my Amendment at this stage and consider his suggestion? I do not like to accept it straight away over the Table, because I really have not considered what the effect would be. It is suggested to me—I am not so well versed in Parliamentary procedure as some of your Lordships—that I should insist upon my words now and allow the noble Lord to amend them on the Report stage. All I can say on that is that if he would be prepared to do that and would give me an opportunity of consulting with him, then if I could come to an agreement I should vastly prefer to do that rather than prolong the debate now.

VISCOUNT HAILSHAM

I understand that the proposal of the noble Lord is to add some words to those which the noble Earl proposes to insert. Speaking off hand, I do not see any real objection to that, but obviously it is a little dangerous to accept words without consideration. If the noble Lord would accept this Amendment now, and then put down a further Amendment on the Report stage, I do not think there will be any difficulty. Of course, the matter would be considered between now and the Report stage.

LORD THOMSON

In the circumstances, I am prepared to accept the Amendment on that understanding.

On Question, Amendment agreed to.

THE EARL OF HALSBURY

I think the noble Lord will agree that the next Amendment on the Paper [in subsection 8] deals with exactly the same point and should be subject to the same agreement. I beg to move.

Amendment moved— Page 13, line 24, after ("interests") insert ("or is unfair or inequitable").—(The Earl of Halsbury.)

On Question, Amendment agreed to.

THE EARL OF HALSBURY had given Notice to move, after subsection (9), to insert the following new subsection:— (10) Any person aggrieved—

1. (a) by the neglect or refusal of a committee of investigation to report to the Board of Trade that any provision of a scheme is contrary to the public interests or is unfair or inequitable in its operation or where such a report has been made is aggrieved by any act or omission of the Board of Trade in relation thereto; or
2. (b) by the neglect or refusal of a committee of investigation to refer a complaint to arbitration under subsection eight of this section;

may, with the leave of the Railway and Canal Commission, appeal to that Commission who shall have power to make such order as they think fit. The noble Earl said: I feel that although this Amendment is not exactly on a par with those which we have just dealt with, it would be very much better in this case, the noble Lord having accepted the last Amendment, that this matter should also be taken into consideration when we are considering what is the best thing to do. Therefore by leave of the House I would rather leave the matter to be dealt with upon the Report stage and I will not move this Amendment.

Clause 5, as amended, agreed to.

Clauses 6 to 9 agreed to.

Clause 10 [Duration of Part I]:

LORD THOMSON

There is only a drafting Amendment to this clause.

Amendment moved— Page 15, line 28, leave out ("Part I") and insert ("this Part").—(Lord Thomson.)

On Question, Amendment agreed to.

Clause 10, as amended, agreed to.

Clause 11:

Constitution of Coal Mines Reorganisation Commission.

11.—(1) There shall be constituted a Coal Mines Reorganisation Commission (hereafter in this section referred to as "the Commission"), which shall consist of five Commissioners appointed by the Board of Trade for such period and subject to such conditions as may be determined by the Board, and the Board shall appoint one of the Commissioners to be Chairman.

(2) A person shall be disqualified for being appointed, or being, a Commissioner so long as he is a Member of the Commons House of Parliament.

(3) A Commissioner shall within three months after his appointment sell or dispose of any interest or shares or securities which he may hold in his own name or in the name of a nominee for his own benefit in any undertaking carrying on in Great Britain the business of coal mining or supplying or selling coal or the manufacture or sale of by-products of coal or machinery or plant for coal mining; and it shall not be lawful for a Commissioner while he holds office to acquire for his own benefit any interest or shares or securities in any such undertaking and if a Commissioner, under any will or succession or otherwise, becomes entitled for his own benefit to any interest or shares or securities in any such undertaking he shall sell or dispose of it or them within three months after he has so become entitled thereto.

(4) If a Commissioner becomes disqualified for holding office, or fails to comply with the provisions of the last foregoing subsection, or becomes in the opinion of the Board of Trade unfit to continue in office or incapable of performing his duties under this Act, the Board shall forthwith declare his office to be vacant, and shall notify the fact in such manner as they think fit, and thereupon the office shall become vacant.

(5) For the purposes of any business for which a quorum of the Commissioners is required by this Act to be present, three Commissioners personally present shall be a quorum, but, save as aforesaid the Commission shall have power to regulate their own procedure, and may act notwithstanding a vacancy in their number.

(6) The Board of Trade may appoint a secretary to the Commission and the Commission may employ such officers and servants as the Board may, with the approval of the Treasury, determine, and there shall be paid by the Board such remuneration to the Commissioners and to the secretary, officers, and servants of the Commission and such other expenses of the Commission as the Board may, with the approval of the Treasury determine and any expenses of the Board under this subsection shall be defrayed out of moneys provided by Parliament.

(7) Any document purporting to be issued by the Commission and to be signed by the secretary or any person authorised to act in that behalf shall be received in evidence and be deemed to have been so issued without further proof unless the contrary is shown.

VISCOUNT BERTIE OF THAME had given Notice to move after subsection (2), to insert as new subsections:— () A Commissioner may resign his office by notice in writing under his hand given to the Chairman of the Commission. () A Commissioner shall if he is interested in any company with which the Commission has or proposes to make any contract disclose to the Commission the fact and nature of his interest and shall take no part in any deliberation or decision of the Commission relating to such contract, and such disclosure shall be forthwith recorded in the minutes of the Commission. The noble Viscount said: I have never known a Minister in charge of a Bill who has admitted that anything in the Bill—

THE MARQUESS OF SALISBURY

I do not know whether my noble friend will allow me to interrupt him, but there is a very important Amendment standing in the name of the noble Lord, Lord Gainford, and my noble friend the Duke of Northumberland. I cannot help thinking that your Lordships will probably prefer not to spend a great deal of time upon the earlier Amendments on the Paper, but that debate should take place upon the Amendment standing in the name of the two noble Peers that I have mentioned. I hope my noble friend will not mind my interrupting.

VISCOUNT BERTIE OF THAME

I should be prepared to adopt the suggestion of the noble Marquess.

THE MARQUESS OF SALISBURY

The other Amendments might perhaps stand over till the Report stage in order that we may have a discussion on the fundamental Amendment standing in the name of the two noble Peers.

THE LORD CHAIRMAN

Then I understand Viscount Bertie does not move. Does Lord Thomson move the Amendments standing in his name?

LORD THOMSON

No.

LORD GAINFORD moved to leave out Clause 11. The noble Lord said: This clause contains a very important proposal which was inserted in another place at the instance of my right hon. friend Sir Herbert Samuel, who was Chairman of one of the many Commissions that have sat in connection with the coal mining industry in the last few years. He presided very ably over that Commission. I was present at the whole of its sittings and heard the evidence, but there was no evidence that I heard that would satisfy me that any system of compulsory amalgamation such as is suggested in Clauses 11, 12 and 13 of this Bill should be placed on the Statute Book. When this Bill was introduced in another place it was obvious that the shortening of hours would involve an increase in the cost of production and the Liberal Party, at the suggestion of Sir Herbert Samuel, pressed for a system of compulsory amalgamation with a view to securing economies in the production of coal to counteract the increased cost of production due to the shortening of hours. If Sir Herbert Samuel had had any real knowledge of the coal trade he would have understood that forced amalgamations are not likely to succeed in reducing costs of production. I submit to your Lordships that anything like forcing a firm to buy something which they do not want to buy, forcing some body to sell something which they do not want to sell and compelling individuals to work together when they do not want to work together, is not calculated to improve conditions in the coal trade.

I suppose that with the exception perhaps of the noble Lord, Lord Melchett, no one has had much greater experience than I have had in connection with amalgamation. Since I have been connected with the firm over which I now preside, we have purchased, in order to secure an output for our collieries, six different sets of blast furnaces from different firms. We have purchased the whole of the shares of three different firms of colliery owners and we are now a large self-contained concern. But all these amalgamations were secured by voluntary arrangement between a willing buyer and a willing seller. Those amalgamations I am all in favour of, and I wish that they should be encouraged wherever economies can take place as a result. But I do suggest to your Lordships that those who have the conduct of large businesses have better opportunities of knowing whether it is advantageous to amalgamate or whether it is not in the interests of a firm to amalgamate. Where amalgamations are likely to succeed in reducing costs of production they inevitably occur. Parties come together and by amicable arrangement amalgamations are made. We have already effected amalgamations in the coal trade, but to force amalgamations beyond those which can be effected by voluntary arrangement is, I believe, a wrong principle. I hope your Lordships will reject this proposal altogether. Although I am not very heartily in support even of further powers in connection with amalgamation, I certainly shall not oppose the alterations which the Duke of Northumberland suggests in connection with Clause 13, which have the effect of securing to the present Railway and Canal Commissioners the increased powers which they have operated under the Conservative Act of 1926 with admirable success. In all cases their recommendations in connection with amalgamations have been accepted, and there have been no appeals.

This proposal of forced amalgamations is really, to my mind, absolutely unworkable. Apart from the points to which I have just referred, I will venture to point out that the proposal is opposed by every employer in the country, so far as it is possible to ascertain their views. The Federation of British Industries, which includes I think 2,000 members, many of them being very large associations of employers, have pointed out their objection to this principle. The Confederation of Employers' Associations, dealing with wages questions and representing practically all the employers of the country, are opposed to it, and the Chambers of Commerce are entirely opposed to it. Let me, merely as an illustration, read an extract from the views of the Chamber of Commerce of Cardiff, which is not necessarily identified with the coal trade alone but also with other interests in Cardiff. A few days ago they passed a resolution which contained these words:— This Chamber is convinced that the proposed reduction of the hours of work at collieries would so increase the cost of production— that certain consequences would follow. The resolution goes on to say that, in the present unprofitable state of industry, the collieries would be compelled to demand a considerable reduction in miners' wages, and that labour troubles would result and bring ruin and disaster. Anything that is going to upset the carrying on of the coal trade is naturally detrimental to the interests of the country.

Those who are responsible for the undertakings and enterprises of this country should be left alone, so far as it is possible to leave them alone, with regard to amalgamation with other concerns. Sir Robert Horne, dealing with this question in another place—and after all he is a man of very wide experience—used these words:— You are sending the Government Commission out on an impossible task and they will achieve nothing at all commensurate with the trouble which they will cause. There is not only no logic in the scheme but no possibility of working it out. I absolutely endorse Sir Robert Horne's view.

There is a point at which amalgamations only do harm. There is a danger of the managing director not realising the capacity of his staff, not being able to keep in touch with all the heads of his departments. The staffs become too large, and there is always a great possibility, if large amalgamations take place, of absolutely losing the esprit de corps which is essential to economy and to avoiding waste in production. It was pointed out in another place that, if this provision were forced upon the community and an ad hoc body set up at the cost of £250,000 a year, it would not succeed because it would have an impossible task to perform. It would result in its feeling that it would have to do something. It would have to compel one concern to absorb another, and one concern would have to undertake obligations that it would never have entered into, but that have been incurred by a different party, in connection with leases, rents, restoration of surfaces and so on. I do feel that this proposal to force amalgamation on an unwilling body is a step in the wrong direction and, as I said on the Second Reading, it is to me unthinkable that this country at the present moment, with all our difficulties, should waste £250,000 a year in sending out a lot of Commissioners who will try to find work for themselves, and who will do no good but a great deal of harm. It is because this clause proposes to set up those Commissioners that I beg to move to omit it.

Amendment moved— Leave out Clause 11.—(Lord Gainford.)

LORD THOMSON

Although, by discussing this matter first, we may save the Committee a lot of time, it is my duty to point out the rather serious consequences which might follow. If there is one thing more certain than another in this world of change, it is that in another place this clause and those that follow in Part II will be reinserted. They were inserted by large majorities, though not originally in the Bill, and they represent something that is absolutely fundamental in the working of the Bill. The absence of amalgamation from this Bill would to all intents and purposes wreck it. I do not want to weary your Lordships, but I should like to repeat the four points that lead the Government to insist upon this Part of the Bill. The first is that the coalmining industry would have much to gain by a greater integration of colliery undertakings. In this Bill we recognise that no hard and fast rule can be laid down and that as much elasticity as possible should be allowed in the operation of this Part of the Bill. The second point is that past experience has proved that, if the initiative in this matter is left entirely to the coal owners, the progress made towards amalgamation will be unduly slow. The third point is that what is required to give initiative to this process, which is generally recognised as desirable, is a disinterested outside body, free from personal or parochial influences, surveying the circumstances as a whole and recommending a course which will give the best results in the national interests. The fourth point is that this body, as constituted, should and would be well designed to negotiate agreements.

For the Conservative Party to resist this argument is, of course, impossible. In their own Act of 1926 they went the whole way in this matter. Literally the only distinction or difference between that which the Government proposes in this Bill and that which was proposed in the Bill of 1926 is at that starting point, the initiation of amalgamation proposals. Subsections (1) and (2) of Section 1 of the Act of 1926 apply, and also Section 7 of the Act of 1926, which introduces the element of compulsion. It may be argued that it is most undesirable that a body of men, described by Lord Gainford as busybodies, or words to that effect, should initiate amalgamation proposals. I think it must be accepted that some outside body should initiate these proposals. It is, I believe, generally accepted that one of the chief obstacles to amalgamation or absorption—and the difference between amalgamation schemes and absorption schemes is that in the first the action is voluntary on the part of all concerned, and in the second it is only voluntary on the part of those who desire to absorb others—is the difficulty of initiation.

The principle of compulsion has to be applied. Many coal owners quite naturally do not like exposing themselves to unpopularity and odium in their own districts by being the first to suggest amalgamation. It is for that reason, and practically only for that reason, that the Government measure suggests an independent outside body, which shall relieve the owners in any districts from the odium and unpopularity which they might incur if they initiated proposals. That is the sole difference between our Bill and the Act of 1926, and I submit that Conservative Peers must have very great misgivings before they turn down this proposal on such very slight grounds. I dare say some of the Conservative Peers did in 1926 vote against it, but nevertheless the measure was put through, and it is now an Act of Parliament passed by a Conservative Government.

LORD BANBURY OF SOUTHAM

They do sometimes make mistakes.

LORD THOMSON

I should be the last to deny the truth of what Lord Banbury has just said. "To err is human; to forgive, divine." We forgive readily that mistake if noble Lords will carry their mistake to a more fruitful conclusion, and look upon this Bill really as the logical outcome of their own Bill, with just that little difference which is designed to help the hesitating, doubting coal owner to do the right thing. Lord Gainford has referred to the expense that would be incurred by the coal trade, amounting to £250,000. I propose, if we ever get to that part of the Bill, to deal with the question of expense under the Amendment to be moved by the Duke of Northumberland, but for the moment all that I need say is that in any case the expense connected with amalgamation will be considerable, and only a small and insignificant fraction of the £250,000 would be due to the fact that Commissioners had been appointed. The expenses would be in connection with law and administration, and so on, and £250,000 does not really play any considerable part in any reasonable survey of this proposition. I do not propose to weary your Lordships any further on this point, except to repeat that the Government regard this Part of the Bill as fundamental. It was passed by large majorities in another place, and if we do send the Bill back without Part II, or without Clauses 11 and 12, at any rate, they will undoubtedly be reinserted.

THE DUKE OF NORTHUMBERLAND

As this Amendment is down in my name, as well as in that of Lord Gainford, I would like to say a few words in support of the Amendment. The noble and gallant Lord who has just sat down made a speech which was, I think, a little beside the point, if I may be allowed to say so. He suggested that your Lordships by voting against Clauses 11 and 12 will be taking a very drastic step, which the House of Commons could not possibly tolerate, and that it would be quite impossible for your Lordships to adhere to the step you had taken. As a matter of fact no such result need ensue, because I have an Amendment, to which he referred, on Clause 13, the effect of which is simply to substitute for this Coal Mines Reorganisation Commission the Board of Trade. The Board of Trade will be able to exercise all the functions under that Amendment which the Coal Mines Reorganisation Commission would be able to exercise. Therefore it would be able to do all the things which the noble and gallant Lord wants them to do, and which I do not particularly want done.

The point I want to make, however, is that there is no reason at all why your Lordships, in voting against these clauses, should debar yourselves altogether from admitting the principle of compulsory amalgamation, if you wish to do so. I want to be perfectly frank about it. I will not say any more about my Amendment to Clause 13, because I presume that that would not be in order on this clause. I am not in favour of compulsory amalgamation, but I agree with the noble and gallant Lord that we should be taking a somewhat big step in cutting out Part II of the Bill altogether. I, therefore, propose this alternative proposal, which would, I think, at any rate mitigate, if not altogether remove, the evil effects of Part II. The noble and gallant Lord said that unless this Commission were set up—this peripatetic Commission which would have power to go round the country to investigate all colliery undertakings, and to compel amalgamations whether coal owners wished them or not—the progress would be unduly slow. In four years before 1926 amalgamations had been effected which affected no fewer than 150,000 workers. That is not really a bad record for four years. Amalgamations, wherever they are necessary and desirable, are taking place gradually. Naturally the process must be slow, but if allowed to go on in the ordinary course no doubt a great many more will take place.

The noble and gallant Lord tried also to make out that these clauses in Part II of this Bill do not go any, or much, further than the Act of 1926. There is all the difference in the world between voluntary amalgamations and absorptions brought about by the owners of colliery undertakings—and I would point out that in 1926 we went a little further than many people thought advisable at the time, and even permitted compulsory amalgamation in some cases, and allowed them to be made by the Railway or Canal Commission, where clearly in the national interests it was desirable to effect them even by compulsion—and a Government Department, or Commission set up by a Government Department, initiating amalgamations and earning their salaries by effecting compulsory amalgamations, whether desirable or not.

The President of the Board of Trade in another place was very clear in describing how this Commission would operate. He said he hoped that it would not be necessary actually to effect many amalgamations by compulsion; he hoped that the mere threat of this terrible tribunal would be sufficient to induce coal owners to effect voluntary amalgamation—if I may be allowed to use the word "voluntary" in that rather paradoxical sense—in order that they might be able to avoid the Stamp Duty on old capital which, under the Finance Act of a few years ago, they are able to avoid in the case of voluntary amalgamations. In other words, this Commission is a kind of sword of Damocles hanging over the heads of the colliery owners, and, if they do not choose to take precautions to avoid its falling on themselves, it will fall and compel them to do what they do not want to do at all. What possible object can there be in leaving people in charge and in management of an industry, and yet interfering with them at every turn, and imposing conditions upon them which they do not believe in, and under which they consider it impossible to conduct their business, and in general interfering with them in every possible way?

I believe that one of the most disastrous effects of this clause will be this. If you take a mine with considerable liquid resources, and it is threatened with a possibility of amalgamation, the first thing it will do is to distribute those liquid resources and get rid of them. It is not going to be taken over and allow all those resources to be disposed of in the way a Government Department may think fit. Another very great danger is this. Everybody who knows anything about coal mines knows that you must work them on a progressive and orderly system. You ought not to take all the plums out of the cake at the first onset. You have to work the bad places in their proper order with the best seams, and provide for a continuous and progressive system of work over a number of years. If a colliery is threatened with amalgamation, what it will do is to try to make as much money as it can in the brief respite allowed to it before it is amalgamated, and work all the best places and leave the rest until its fate has been decided by the Government Department. The Lord Chancellor said in the debate on the Second Reading that a Minority Government would not be justified in nationalising the coal mines. I think, on the contrary, that nationalisation would be far more justifiable than the present proposals. You have no right whatever to leave men in charge of a business and then say that they are not fit to conduct it and to impose all sorts of conditions upon them which they do not believe in. If they cannot manage their business, it would be much better to buy them out, take it away from them, and let the State run the business itself. What are the real reasons for this Part II of the Bill? I would first remind your Lordships that these clauses were not in the original Bill at all. They were inserted as part of a bargain between the Liberal Party and the Government—one of those many bargains by which that Party hopes to prolong a precarious and singularly aimless existence. But the second reason was that it is all part of a continuous and persistent effort, which has been going on ever since the close of the War, to attempt to prove that the root evil in the coal industry is solely due to the delinquencies and failures of the coal owners—their lack of a sense of the public interest, their failure to organise their industry, to adopt up-to-date methods, and so on. I hold no brief for the coal owners. I am not one myself; at least I am not a colliery owner. But I imagine you could make out quite a good case against certain coal owners in certain coalfields at certain periods; but you might say the same about any other industrial undertaking in this country. But everybody knows—we have only to look back at the history of the last twelve years—that the real evil in the coal industry was not that at all. It was that the Miners' Federation had a strangle hold on the industry, and were imposing conditions under which it was quite impossible to work that industry on an economic basis; that those facts were deliberately slurred over and concealed from the people of this country; that two Royal Commissions never put the case in all its bearings before the people of this country; that those conditions were allowed to continue and led directly to the worst industrial disaster we ever had, the General Strike.

That was a blessing in disguise, because it got rid of all those impossible conditions, not only conditions as to wages and hours (it was quite natural that the men should want the best wages and hours) but also all sorts of regulations and restrictions—two or three men doing the work where one could have done it perfectly well; and the only means by which the industry could get back on to an economic basis was the General Strike. Now we are seeking in this Bill to impose all those conditions from which the strike freed us, and it is leading us straight to another disaster. These clauses in Part II are only an instance of an attempt to make the conditions quite impossible for the coal owners. In the Second Reading debate the Lord Chancellor said that what we wanted was an ethical revival. I must say I cannot see the elements of an ethical revival in all this log-rolling, this concealment of the real issues, and this total failure to deal with the real evil in the industry and to exaggerate one which is only a lesser one.

THE MARQUESS OF READING

We are dealing with a clause in the Bill which is undoubtedly of supreme importance. As the representative of the Government has said, these Clauses 11, 12 and 13 are vital to the Bill. May I just for a moment recall the origin of the clauses as to amalgamation? Amalgamation as a beneficial principle to the industry of coal mining was recognised very completely by the Conservative Government when it passed the 1926 Act. There are in that Act provisions very definite and distinct, inserted by the Conservative Government, for the purpose of fostering and promoting amalgamation. I have heard it stated, and I think it was stated by Lord Thomson to-day, that compulsion was actually in the Bill; it was not in the same form as it is here to-day, but that the principle was certainly thought to be there can hardly be denied.

I do not profess to have before me the details of what happened in the Committee stage of that Bill, but I have heard it stated on very reliable authority by those who were present that this very matter was raised as to whether the clauses of the Bill should not be strengthened for the purpose of making it plain beyond all doubt that there was the element of compulsion in amalgamations if necessary. It was, as I am told, at that time thought that it was unnecessary, because the Bill was sufficiently plain and explicit. I only refer to that for the purpose of showing that what is intended now travels along the same road. I leave out for the moment the other question that has been raised; I am dealing with the main matter involved in the Bill, and which has been attacked, and that is the compulsory character which is given if necessary. That is what was done in 1926. Since then, as the noble Duke told your Lordships just now, a number of amalgamations have taken place. Unfortunately, they do not proceed sufficiently far. There are difficulties. There are persons who are unwilling at any time to amalgamate. There are some coal owners who, like other individuals, are not perhaps so reasonable as those who take a different view think they should be.

As I understand, the effect of the clause which is now introduced is to make it clear that the desirable object of amalgamation—because that cannot be disputed, and is the very essence of the section in the Act of 1926—was a panacea for the trouble. It was thought that amalgamation was the way by which to set this industry on its feet and it was hoped that it would be unnecessary to proceed further, and that in the course of a short time by the means that were given under the Act and the powers which were given to the Tribunal it would be unnecessary to provide any further legislation. Unfortunately, that does not seem to have been the case because, as we now know, there are vast numbers of concerns which should and which would undoubtedly prove beneficial to the community and to the trade if they were amalgamated, but which for one reason or another have failed to come to terms. Many of your Lordships have considerable experience of business, and I am perfectly sure that you realise at once that there are those who stand out sometimes, and mostly, no doubt, because they do not wish to amalgamate. There are others who refuse to amalgamate because—I think I am using a phrase of my noble friend Lord Melchett on the Second Reading—they wish to acquire a nuisance value. All these incidents are well known to those who have to deal with amalgamations and are seeking to put them into effect.

We start, therefore, from this admitted standpoint, that it is necessary in the interests of the coal mining industry that there should be amalgamations, that they should be made effective and that for that purpose facilities should be given by the State. That is what the Act of 1926 did. All that these clauses do at this moment is to set up a special tribunal for the purpose of providing a means of amalgamating concerns in which there has been a total failure either to take the initiative to amalgamate or where, as sometimes happens, some of the persons concerned are unreasonable and are demanding excessive terms. The Bill provides that no one shall suffer. The assessment may be made by the Commissioners, if it is to be made, upon the principle of a willing buyer and a willing seller. Various conditions have to be taken into account and, of course, the matter is not simple. Anyone who is at all familiar with amalgamation in industry knows perfectly well that it is always a matter of some complication. There are various interests to consider. Amongst other things, you must take into account that it means that persons who have been working in competition are now to work together in harmony for the joint good.

All those circumstances are for the consideration of the Commissioners. But the Commissioners never come into the picture at all for this purpose unless there is a failure to bring about amalgamation which the Government in 1926 said was so necessary that there must be a special Act of Parliament and special provisions for it. That is all that is sought to be done. I would submit to your Lordships that it is really in the interests of the industry. I do not happen to be a coal owner and I cannot speak, of course, with the authority either of my noble friend Lord Gainford, or the noble Duke, or any of your Lordships who are interested; but those who have had to consider the whole situation and it may be are able to take a more detached point of view see that the difficulties involved can all be surmounted with a little good will, at any rate by an independent tribunal.

If you once agree that amalgamation is desirable and is necessary for the coal trade, it is inevitable that you should have some means by which you can bring those who are standing out into an amalgamation scheme—of course, on perfectly fair and equitable terms. That is what I understand this Bill seeks to do, and I would submit that it would be very unfortunate if your Lordships rejected these clauses. Inevitably the Bill must go back to another place, and I can only say from my knowledge of such matters that the clauses will be re-inserted and will come back to your Lordships, because it is thought that they are vital to the Bill and to the whole scheme. We are dealing with a wholly exceptional set of circumstances. I wonder whether any of your Lordships has ever heard of a Bill introduced particularly by a Labour Government which will have the effect of raising the price of the commodity involved to the consumer? The idea staggers me. I am not particularly enamoured of it but I am told, and we are all told, that it is necessary that we should have a Bill of this kind for the purpose of putting this most important industry on its feet. It is for that reason that one may say that a temporary farewell has been said by a Labour Government to principles to which they have hitherto always adhered.

For my part, I confess it is infinitely preferable to nationalisation. I am surprised that I should find it necessary to pronounce in your Lordships' House against nationalisation after the speech from the noble Duke. But this is far better than nationalisation. May I suggest to him that if we poor unfortunate members of a small Party are pursuing an aimless existence we can at any rate take comfort that our aim has been to make this Bill a good Bill. We disliked it intensely as it was introduced. We thought that as introduced it ought not to pass. The Party in another place was convinced that it was injurious to the public and that sufficient protection had not been given to the consumer, whose interests ought undoubtedly to weigh very much with us. Moreover, it was necessary to do more than was done in the first instance by the Bill as introduced, and certain points were put forward. This was one of them.

I do not want to discuss the question of a bargain. So far as I am aware there never was a bargain, unless you say that a bargain consists in this, as was stated on the floor of another place by Sir Herbert Samuel and Mr. Lloyd George, that unless four points to which the utmost importance was attached were accepted by the Government the members of the Liberal Party would vote against the Bill. If that is a bargain then apply the word; but it was really a condition which was openly stated in order to give the Government an opportunity of amending the Bill or of reintroducing it, or putting it into such a form as would comply with the conditions attached, and eventually they saw their way to do that. Although I cannot say they went in every way as far as we should have liked, nevertheless they did go a long way, and made the Bill a far better Bill, I venture to think, than it was when originally introduced. If your Lordships choose to leave out this clause, when it gets back to the other House, with assistance that Party which has so much influence will at least achieve its end of getting this amalgamation clause put back into the Bill.

THE MARQUESS OF SALISBURY

As I listened to the noble and learned Marquess I was tempted to think, what I never otherwise should have thought, that he really had not read the Amendment with which we are dealing.

THE MARQUESS OF READING

It is to leave out the clause.

THE MARQUESS OF SALISBURY

Certainly, but there are other Amendments consequential, and I would recommend the noble and learned Marquess to vary his practice and read the Amendment on the Paper and not be content with only one paragraph in it. We have heard an apologia from the noble and learned Marquess for the change of front of the Liberal Party in another place. He attributed it to the victory of the negotiators—across the floor of the House. There was nothing behind the scenes; no conversations. I am sure all your Lordships will believe that. I think that one of the reasons of the change of attitude of the Liberal Party that was given was the continuance of the Naval Conference. But the Naval Conference is over. The noble and learned Marquess ought to have revised his speech, because it was no longer apt. To the Amendments of my two noble friends I hope your Lordships will see fit to agree. The Amendments standing in the name of my noble friend the Duke of Northumberland deserve none of the strictures which have been made against them. It is perfectly true that the great majority of your Lordships are opposed to amalgamation, and the philippics of the noble Marquess were delivered against that position, but there is no proposal on behalf of my noble friends to abolish compulsory amalgamation or take it out of the Bill.

THE MARQUESS OF READING

I am glad to hear it.

THE MARQUESS OF SALISBURY

The noble Marquess says he is glad to hear it; I am sorry I should be the first to inform him of it.

TIIE UNDER-SECRETARY OF STATE FOR INDIA (EARL RUSSELL)

It is not the Motion before the House.

THE MARQUESS OF SALISBURY

I would invite the noble and learned Marquess and the noble Earl opposite not to be too technical, but to take these Amendments in their completeness. Though I agree that your Lordships sitting on this side of the House have been content, reluctantly, to accept the principle of compulsory amalgamation, there is nothing on the Paper which ought to have misled noble Lords into thinking there was anything else aimed at than a question of the procedure and methods and instructions under which the compulsory amalgamation ought to take place, and the conditions limiting it. That is all there is. How should that be fundamental? How, indeed, can any question of amalgamation be fundamental considering it was not in the Bill originally? On what foundations did the original Bill rest? May I ask the noble and gallant Lord, if this is fundamental, was it hanging in the air? If there were no foundations to the original Bill, how came it that the distinguished Ministers I see sitting opposite were responsible for introducing it into Parliament? The foundation of the Bill, according to the noble and gallant Lord, was introduced after the Bill had been for many weeks before the House of Commons. I never heard of a building being put up quite on those principles.

But we are going to leave this foundation. We are, however, going to suggest that it should be subject to certain alterations. May I invite the noble and gallant Lord—and I might almost include the noble and learned Marquess—not to suggest to your Lordships that they must do nothing because of what may ultimately happen to it in the House of Commons. That is not the way to address an independent Assembly. We must do what we think right, and the House of Commons, of course, will also do what they think right, and an adjustment must be come to. I will not predict what that adjustment may be. For my part I lay great store by this Amendment. I believe it to be a very important Amendment, and I shall say so in a very few words, if your Lordships will now allow me.

The noble and gallant Lord said that it was necessary to have some authority which is free from parochial interests, and that the initiative of amalgamation should not be thrown upon the shoulders of an individual. So far as we are concerned those arguments do not affect us. There is going to be a re-arrangement, which the noble Duke himself referred to, if your Lordships are good enough to accept this suggestion as to the authority under which this shall be done. I agree that on this side of the House we greatly dislike the interference of public authorities in the business of industry, but of all public authorities which can interfere with industry the worst of all is the ad hoc emergency body. They know that they are appointed for a particular purpose. They are only there for one purpose, in this particular case for the purpose of amalgamation, and they are to go about the country to find how many things they can amalgamate. That is not the spirit in which this ought to be conducted.

As I listened to the noble and gallant Lord opposite on the Second Reading it seemed to me that instead of considering the number of undertakings, which are few, that should be amalgamated, he was considering, amongst the number of undertakings, that as few as possible should escape from amalgamation. His idea was to amalgamate everything he could. That certainly is not the idea of those who sit on this side of the House. We admit, and we have always admitted—the Conservative Government admitted it when they introduced the Bill of 1926—that there are certain undertakings which ought to be amalgamated with others—those which were referred to by my noble friend Lord Melchett, as nuisances. They ought to be amalgamated with others. But we do not mean that the whole of these undertakings ought to be subjected to amalgamation. Only in exceptional cases ought there to be amalgamation. Of course the noble and gallant Lord and the noble and learned Marquess seemed to think that almost everything ought to be amalgamated. "A vast number" was, I think, the phrase of the noble Marquess—a vast number of these mining undertakings ought to be amalgamated. That does not appear to us to be at all justified by the evidence. Certainly there are some undertakings that ought to be amalgamated, but to say that a vast number ought to be amalgamated is, in our view, to go entirely beyond the mark.

Therefore it appears to us that to appoint an ad hoc emergency Commission is entirely the wrong way to go to work. Entrust it, if you like—as you must if you are going to have the intervention of a Government Department—to a Government Department of experience, a Government Department accustomed to dealing with mining undertakings and many other undertakings which minister to their experience of affairs. That is a perfectly reasonable sort of public authority if you must have one to initiate these amalgamations. But if you appoint an ad hoc body of five gentlemen—we do not know who they are, although if we did know I do not know that it would make much difference—five gentlemen whose business is to do nothing else except to amalgamate, then we say you are proposing to interfere with the reasonable administration of a great industry in the teeth of the wishes of that great industry, and it will almost certainly end in disaster. It is for that reason that we think the Amendment very important. I earnestly hope that we shall not waste time by discussing whether there ought to be compulsory amalgamation or not, because that particular point has been abandoned. What we should discuss is what is the reasonable method of initiating it and carrying it through and the conditions which ought to apply. In that way we may be able to prevent the harm which the Bill is otherwise calculated to do.

LORD JOICEY

I have listened to the various speeches made and I think the case put forward by those opposing the Bill has been stated very clearly. I have had some experience in dealing with coal mining and to me the arguments are unanswerable. Like the noble Marquess, I was very much astonished to hear the noble Lord, Lord Thomson, state that this particular proposal is absolutely necessary to the Bill because, when you realise that it was not in the Bill originally, it appears to me as if pressure had been brought to bear and as if its insertion was made really without any great consideration upon the part of His Majesty's Government. I was rather surprised to hear the noble Marquess who spoke in support of the Bill state that the reason he did so was because he was told that it was the only way of setting this industry upon its feet. I have listened to the speeches made, and I confess there has not been a single argument which gives me that impression. If I believed that that was the only way to set this great industry upon its feet I should be only too glad to fall in with the wishes of the Government, but instead of its being the only way of setting this great industry upon its feet, I am afraid that we shall only have the same experience as we have always had in connection with interference by Governments—a considerable increase of costs. If you look at the various cases of interference by the Government with trade you will find that it always ends in increased costs and that, I feel quite sure, will be the result of this Bill.

No doubt many of your Lordships look upon coal trade amalgamations in the same way as you look upon amalgamations in connection with other industries, but the coal trade is like no other. Every mine is a unit in itself. If you make an improvement in one mine it has no effect whatever upon any other mine. The only way I see in which you would do any good would be to close all the mines which are not able to make a profit and to work those from which you can make some profit. But what would be the result of that? The evil would be very much greater in my judgment than the good which would come from such a policy. You would find that you had reduced output, you would increase the costs of production, you would increase the price to be paid by the consumer, and I feel quite sure that there would be no increase of wages for the miner. Why I am so strongly opposed to this particular Part of the Bill is that I feel it will do infinitely more mischief than good to the industry. It is said that we must pass this Part of the Bill because when it goes to another place it will be restored. Well, let the other place take the responsibility of it. I would certainly vote against this and leave to another place the responsibility, because I feel quite sure in my own mind that it will be a failure, and I would rather that the responsibility should rest on the Miners' Federation and the present Government, who really have brought forward this Bill not for the benefit of the industry but as a political measure from which they hope to get some advantage.

I certainly feel that this injury which you are doing is one which, if this Bill becomes an Act, will be much more serious than you realise. Here is a great industry representing £150,000,000 of capital and employing a million people. What is happening? These politicians are simply gambling with this great industry and, I think, for the sake of votes. The vote is the predominant cause, I think, of this Bill, and having weighed the case I have very little faith in the statements that are made that this measure is for the benefit of the industry and the community at large. I hope that your Lordships will vote against this, because if you do so you will throw the responsibility of this clause upon the other House, and I am so sure that it will ultimately be a failure that I would rather have the responsibility upon their shoulders than upon ours. I cannot understand why this business should be taken out of the hands of those who have controlled it for the last fifty or hundred years. I should not think that any business had been better managed on the whole. I do not think any business has conferred greater benefits on the country than the business of producing coal. As has been said again and again, the coal which is exported has to a large extent paid for the food which we import into this country, and I think that unless we can keep our export trade we shall certainly lose a very great advantage.

I cannot understand why the business should be taken out of the hands of those who have controlled it. If you look at the past you will find that until the War we had always given satisfaction and carried on the business satisfactorily. When people talk about the industry not being efficiently managed, I would recommend them to read the speech delivered by Sir Robert Horne, with very great thought and care, and I am sure they will come to the conclusion that that charge is unfounded. If that charge is proved to be unfounded I fail to see what other reason you can give for making an exception of the coal industry. I will not go further into the matter because I think the case has been admirably put by my noble friend Lord Gainford, the noble Duke and others. I found their arguments unanswerable. I feel sure that time will justify those arguments and that, if you pass this measure in its present form, it will be a great disaster to everybody connected with the industry.

LORD THOMSON

I can assume that Clauses 11 and 12 are to remain part of the Bill and that we are now discussing Clause 13—in other words, the Amendment of the noble Duke.

VISCOUNT HAILSHAM

Oh, no. I understand that the Amendment before us is to omit Clause 11. It is quite true that a good deal of the arguments that the noble and learned Marquess and the noble and learned Lord opposite put forward seemed to be based on the assumption that we were discussing something that is not even in Clause 13—

EARL RUSSELL

And the Leader of the Opposition.

VISCOUNT HAILSHAM

But the Amendment, before the Committee is to omit Clause 11, which sets up the Commission. When you get to Clause 13 certain Amendments will be proposed which will, no doubt, have the effect of giving certain powers to the Board of Trade to initiate compulsory amalgamation. What I thought we were discussing—and I gather that your Lordships generally agree—is the proposal to leave out Clause 11, which is the clause which sets up a special Commission for the purpose of carrying out these amalgamations. Probably Clause 12 is consequential on Clause 11, but Clause 13 gives certain powers to the Commission which I hope we shall have the opportunity of discussing later.

THE MARQUESS OF READING

I am afraid the matter is not entirely clear to me at this moment. No doubt it was my own fault, but I understood that we were discussing the general principle. I have no complaint to make, but I gather that it is not proposed to remove compulsory amalgamations from the Bill, and the only question is—or so I gathered from the remarks of the noble Marquess, the Leader of the Opposition, and also from my noble and learned friend just now—the question of the tribunal—

VISCOUNT HAILSHAM

May I correct my noble and learned friend? He has spoken several times of the tribunal. The tribunal, under both the proposals of the noble Duke and those of the Bill, is the Railway and Canal Commission. The Bill proposes to set up a body which is not a tribunal and had no judicial office—a special body, or Commission, as it is called—in order to bring about these compulsory amalgamations.

THE MARQUESS OF READING

Quite so.

LORD THOMSON

The situation is now much clearer to me, thanks to the noble and learned Viscount opposite, than it was before. I understand that we are entitled to discuss the Amendments to Clause 13. The speeches of the noble Duke and of the noble Marquess the Leader of the Opposition entitle me to do so. In fact, we are at this moment discussing the whole question of Part II and a possible substitute for the amalgamation proposals of the Government. The proposed substitute admits that there shall be a measure of compulsion, and practically agrees with the Bill as it stands, except that for the Commission the noble Duke substitutes the Board of Trade. All his Amendments follow consequentially on that. They merely replace the word "Commission" by the words "Board of Trade." I can be very brief upon that point. The noble Marquess opposite said that he objected very strongly to any Government interference in industry, but on this occasion he recognised that a certain amount of interference was necessary.

THE MARQUESS OF SALISBURY

I was not prepared to advise your Lordships to differ from the House of Commons upon a matter of that kind, which had been to some extent settled by the General Election.

LORD THOMSON

But that of all forms of interference the most objectionable was that of an ad hoc body.

THE MARQUESS OF SALISBURY

Hear, hear.

LORD THOMSON

The noble Lord, Lord Joicey, said that he objected to Government interference pure and simple.

LORD JOICEY

I have always done so.

LORD THOMSON

I should have thought, then, that he would have objected more strongly to the proposals of the noble Duke than to those of the Government, because the interference that the noble Duke suggests is direct Government interference in the industry through the Board of Trade. I am almost certain that the noble Lord, Lord Banbury of Southam, will agree with me on that point.

LORD BANBURY OF SOUTHAM

I did not hear what it was.

LORD THOMSON

The suggestion of the noble Duke is that Government interference should be direct, through the Board of Trade and not through an ad hoc body.

LORD BANBURY OF SOUTHAM

My view is that I hope we shall leave out Clauses 11 and 12 and that, when we come to Clause 13, we shall not accept the Amendment of the noble Duke.

LORD THOMSON

That only shows the advantage of discussing these three clauses simultaneously. We get very much more light on the subject than we should otherwise be able to get. I am a little surprised that the noble Duke should wish to substitute the Board of Trade for an ad hoc body. I submit to your Lordships' consideration that there is very little difference between his proposal and that of the Government. After all, what is the Board of Trade going to do if these duties are thrust upon it? It has no staff suitable for investigating this question, and it would have to employ other people for the purpose. It would probably employ people of identically the same description as would the Commission provided for in the Bill.

Nor can I see that there would be any saving in money. Indeed, it might be necessary to have a great deal more money expended, because the Board of Trade would have to take counsel from captains of industry and other well-informed persons to enable them to undertake and execute the onerous task that is put upon them by the noble Duke's Amendment. What difference, in fact, would there be if the Board of Trade had this direct responsibility? They would probably appoint, instead of five Commissioners, a good many more persons, and they would always have a very irksome responsibility because these men would be their employees. The other body, on the other hand, would be a body of distinguished men of affairs, working keenly, no doubt, in the interest of amalgamation.

Both the noble Duke and the noble Marquess talk about amalgamation as if it were an excellent thing provided there is not more than a very little of it. I think that this is a fair deduction from the remarks of the noble Marquess. He said that of course we must have amalgamation, but not too much. What has been the effect of the Act of 1926, with its compulsory clause but without a body from outside initiating amalgamations? There are two White Papers before your Lordships at the moment—the Reports of 1928 and 1929—which give the results. One-seventh of the industry was affected in four years; in fact since 1926. It would take about 25 years for any reasonable amount of amalgamation to be introduced into the coal industry, and yet every one agrees that amalgamation is a good thing.

Several NOBLE LORDS: No, no.

LORD THOMSON

The noble Marquess and the noble Duke agree. The latter wants it done by the Board of Trade.

THE DUKE OF NORTHUMBERLAND

I do not want it done at all. It is a choice of evils, and I prefer the evil which I propose.

THE MARQUESS OF SALISBURY

Mitigate it as much as we can.

LORD THOMSON

I do not think the noble Marquess and his colleagues can get away from the Act of 1926. Whether they were sincere at that moment or not it is not for me to say, but they have admitted the principle of amalgamation, and embodied it in an Act of Parliament, and now the House is asked to make that amalgamation under the Board of Trade instead of under Commissioners. I submit that the Commissioners are a more desirable body to do this, in every way, than the Board of Trade. There is very little difference between the suggestions, but the balance is in favour of the proposals in the Bill. In conclusion let me say this. There has been a good deal said about bargains in the House of Commons, and how the Liberal Party constrained the Government to put in these amalgamation proposals. I really submit that it is not quite fair. I dare say most of your Lordships read the Second Reading speech of the President of the Board of Trade. There he said that the Government had the fixed intention of bringing in amalgamation proposals, and were going to set up Commissioners under the Act of 1920, and that legislation would follow. The Government, I admit quite frankly, did not include these proposals in the Bill.

THE MARQUESS OF SALISBURY

These fundamental proposals.

LORD THOMSON

Proposals which were fundamental, proposals which the Government had in mind, and the spokesman of the Government in the other Rouse, in his Second Reading speech said it was our intention to introduce these proposals. We were a very willing horse in that matter, and jumped the fence with the greatest gladness. There was no question of constraint. It was merely a question of time when we should bring in these particular clauses of the measure. I am sorry that I cannot offer even the slightest compromise in this matter. It is absolutely necessary to resist the Amendment by which it is proposed to delete these clauses of the Bill, and also to resist the Amendment put down by the noble Duke.

LORD DARYNGTON

I think this debate is the most illuminating one that has taken place since I have been a member of this House. The noble and gallant Lord in the first instance said this was a wrecking Amendment and vital to the Bill. Now he says it makes very little difference whether we take the proposal of the noble Duke or that in the Bill.

LORD THOMSON

I said that the wrecking part was to leave out these two clauses.

LORD DARYNGTON

So far as the Liberal Party is concerned they seem to be divided, because Mr. Runciman, who was President of the Board of Trade in the Liberal Government, opposed these amalgamation clauses, and I suggest that the best plan would be to take a Division with regard to Clause 11 and then take a Division with regard to the other matter.

On Question, Whether Clause 11 shall stand part of the Bill?

Their Lordships divided:—Contents, 26; Not-Contents, 147.

CONTENTS.
Sankey, L. (L. Chancellor.)	Mersey, V.	Marks, L. [Teller.]
		Marley, L. [Teller.]
Parmoor, L. (L. President.)	Amulree, L.	Meston, L.
	Arnold, L.	Morris, L.
Reading, M.	Cawley, L.	Passfield, L.
	Clwyd, L.	Ponsonby of Shulbrede, L.
De La Warr, E	Colwyn, L.	Sandhurst, L.
Russell, E.	Cozens-Hardy, L.	Shandon, L.
	Dickinson, L.	Stanmore, L.
Leverhulme, V.	Hemphill, L.	Thomson, L.
		Vernon, L.

NOT-CONTENTS.
Northumberland, D. [Teller.]	Hailsham, V.	Hanworth, L.
Rutland, D.	Hereford, V.	Hardinge of Penshurst, L.
Somerset, D.	Hood, V.	Harris, L.
Wellington, D	Hutchinson, V. (E. Donoughmore.)	Hastings, L.
		Hawke, L.
Bath, M.	Novar, V.	Hindlip, L.
Camden, M.	Plumer, V.	Boward of Glossop, L.
Lansdowne, M.	Ullswater, V.	Illingworth, L.
Linlithgow, M.		Joicey, L.
Salisbury, M.	Aberdare, L.	Kenmare, L. (E. Kenmare.)
Zetland, M.	Abinger, L.	Lamington, L.
	Addington, L.	Leconfield, L.
Abingdon, E.	Aldenham, L.	Leigh, L.
Bathurst, E.	Alvingham, L.	Melchett, L.
Bradford, E.	Ampthill, L.	Meldrum, L. (M. Huntly.)
Clarendon, E.	Annaly, L.	Merthyr, L.
Cranbrook, E.	Armstrong, L.	Methuen, L.
Denbigh, E.	Arundell of Wardour, L.	Middleton, L.
Dudley, E.	Askwith, L.	Mildmay of Flete, L.
Eldon, E.	Auckland, L.	Monkswell, L.
Feversham, E.	Banbury of Southam, L.	Monson, L.
Fitzwilliam, E.	Belhaven and Stenton, L	Newton, L.
Grey, E.	Biddulph, L.	O'Hagan, L.
Halsbury, E.	Brancepeth, L. (V. Boyne.)	Oxenfoord, L. (E. Stair.)
Inehcape, E.	Carson, L.	Ponsonby, L. (E. Bessborough.)
Jellicoe, E.	Clanwilliam, L. (E. Clanwilliam.)
Lauderdale, E,		Queenborough, L.
Lindsay, E.	Clifford of Chudleigh, L.	Rathcreedan, L.
Lindsey, E.	Cranworth, L.	Rayleigh, L.
Lucan, E.	Cullen of Ashbourne, L.	Redesdale, L.
Lytton, E.	Cushendun, L.	Remnant, L.
Midleton, E.	Danesfort, L.	Ritchie of Dundee, L.
Midlothian, E. (E. Rosebery.)	Darling, L.	Rossmore, L.
Morton, E.	Daryngton, L.	Russell of Liverpool, L.
Mount Edgcumbe, E.	Dawnay, L. (V. Downe.)	St. John of Bletso, L.
Onslow, E.	Deramore, L.	Saltoun, L.
Peel, E.	Desborough, L.	Sherborne, L.
Plymouth, E.	Dynevor, L.	Sinclair, L.
Rosslyn, E.	Eiphinstone, L.	Somerleyton, L.
Stanhope, E.	Fairfax of Cameron, L.	Templemore, L.
Vane, E. (M. Londonderry.)	Fairhaven, L.	Teynham, L.
Yarborough, E.	Fairlie, L. (E. Glasgow.)	Trenchard, L.
Ypres, E.	Faringdon, L.	Trevor, L.
	FitzWalter, L.	Vivian, L.
Bertie of Thame, V	Forester, L.	Wavertree, L.
Bridgeman, V.	Gage, L. (V. Gage.)	Weir, L.
Chaplin, V.	Gainford, L. [Teller.]	Wemyss, L. (E. Wemyss.)
Churchill, V.	Gisborough, L.	Wester Wemyss, L.
Falkland, V.	Glanusk, L.	Wharton, L.
Falmouth, V.	Greenway, L.	Wraxall, L.
FitzAlan of Derwent, V.	Hampton, L.	Wynford, L.
Goschen, V.

Resolved in the negative, and Clause 11 disagreed to accordingly.

Clause 12:

General functions of Coal Mines Reorganisation Commission.

12.—(1) It shall be the duty of the Coal Mines Reorganisation Commission (here after in this section referred to as "the Commission") to further the reorganisation of the coal mining industry with a view to facilitating the production, supply, and sale of coal by owners of coal mines, and for that purpose to promote and assist, by the preparation of schemes and otherwise, the amalgamation of undertakings consisting of or comprising coal mines where such amalgamations appear to the Commission to be in the national interest.

(2) The Commission may hold such inquiries as they consider necessary or desirable for the discharge of their functions under this Act, and, in respect of any meeting of the Commission at which a quorum of the Commissioners is present for the purpose of any such inquiry, the Tribunals of Inquiry (Evidence) Act, 1921 (other than paragraph (a) of Section two thereof) shall apply to the Commission as if it were a tribunal established in manner provided by that Act and as if that Act had been applied thereto in the manner thereby provided.

(3) The Commission may from time to time employ such technical and professional agents as they consider necessary or desirable for the discharge of their functions under this Act, and, subject as hereinafter provided, there shall be paid by the Board of Trade such remuneration to the agents so employed as the Board may, with the approval of the Treasury, determine, and the expenses of the Board under this subsection shall be defrayed out of moneys provided by Parliament: Provided that a sum certified by an accountant appointed by the Board of Trade to be equal to the amount of any expenses properly incurred by the employment of such agents as aforesaid for the purpose of promoting or assisting the amalgamation of any undertakings shall, in the event of the undertakings being amalgamated, he repaid to the Board by the owners of the amalgamated undertaking.

On Question, Clause 12 disagreed to.

Clause 13:

Amendments of Part I of 16 & 17 Geo. 5, c. 28.

13.—(1) If it appears to the Coal Mines Reorganisation Commission that it is expedient for the purpose of promoting the more economical and efficient working, treating or disposing of coal that an amalgamation scheme or an absorption scheme, under Part I of the Mining Industry Act, 1926 (hereinafter in this section referred to as "the Act of 1926"), should be prepared and submitted with respect to any two or more undertakings consisting of or comprising coal mines, the Commissioners shall require the owners of those undertakings to prepare and submit to the Board of Trade an amalgamation scheme or absorption scheme with respect to those undertakings framed in accordance with the provisions of Part I of the Act of 1926, and if the owners fail so to submit such a scheme within such a time as may have been specified by the Commissioners, the Commissioners shall themselves prepare and submit such a scheme to the Board of Trade, and for the purposes of that Part of that Act any scheme so prepared and submitted by the Commission shall be deemed to have been prepared and submitted in manner provided by subsection (1) or (2), as the case may be of Section one of that Act, and that Act shall apply accordingly: Provided that no such scheme of amalgamation shall provide, without the consent of the owner of the undertaking, for the separation of the treating and disposing of coal from the working thereof, or, in the case of an undertaking of which the primary object is not coal mining, for the separation from the undertaking of any coal mine worked as ancillary for such primary object.

(2) If the owner of any undertaking (in this subsection referred to as the "transferor undertaking") proposed by any scheme submitted by the Coal Mines Reorganisation Commission to be amalgamated with, or absorbed in, any other undertaking (in this subsection referred to as the "transferee undertaking") satisfies the Railway and Canal Commission that any money or securities belonging to the transferor undertaking formed, at the date of the passing of this Act, a reserve which, when the scheme was submitted, was not required for the efficient carrying on of the transferor undertaking, the Railway and Canal Commission shall not confirm the scheme except after making such modifications, if any, as may be necessary for securing that the money or securities will not be transferred to the transferee undertaking.

(3) For the purposes of any scheme under Part I of the Act of 1926 the value of the undertaking of every constituent or absorbed company shall be assessed upon the basis of what would have been the value thereof as between a willing buyer and a willing seller if this Act had not been passed, and no such scheme shall be submitted to the Board of Trade under the said Part I unless the Coal Mines Reorgansation Commission have certified that such values have been so assessed for the purposes of that scheme.

(4) Where a scheme is referred by the Board of Trade to the Railway and Canal Commission under Section six of the Act of 1926, the Coal Mines Reorganisation Commission shall be entitled to appear and be heard at any proceedings in connection with the scheme.

(5) No scheme shall be submitted or certificate granted by the Commission under this section except in pursuance of a decision made at a meeting at which a quorum of the Commissioners is present.

(6) Where an amalgamation scheme submitted to the Board of Trade by the owners of two or more undertakings under subsection (1) of Section one of the Act of 1926 is certified by the Coal Mines Reorganisation Commission to be in the national interest, and the owners submitting the scheme represent to the Board that it is unnecessary for the purpose of giving effect to the scheme that it should be confirmed by the Railway and Canal Commission under the Act of 1926, it shall not be necessary for the Board to refer the scheme to the Railway and Canal Commission under that Act, but if the Board certify that the provisions of the scheme as to any debentures or as to the issue of any share or loan capital are reasonably required for the purpose of the amalgamation, subsection (2) of Section five of the Act of 1926 (which grants certain exemptions from stamp duty in respect of schemes confirmed by the Railway and Canal Commission) shall apply in respect of the scheme and of anything done in pursuance thereof as if the scheme had been confirmed by the Railway and Canal Commission.

(7) This section shall be construed as one with Part I of the Act of 1926.

THE LORD CHAIRMAN

I do not know which will be the more convenient course on this clause. The Duke of Northumberland has a proposal to substitute the Board of Trade for the Coal Mines Reorganisation Committee. His proposal is to insert a new clause at length.

THE DUKE OF NORTHUMBERLAND

It is a little confusing. The Amendments which are on the Paper in my name are exactly the same as the new clause. It is not really a new clause; it is only put in for the sake of clearness. That clause merely shows how the clause would read if my Amendments were put in.

THE LORD CHAIRMAN

I appreciate the difficulties, and I think I should like the guidance of your Lordships as to which procedure you wish to follow—whether you are going to omit the clause and put in the new clause or whether you will go through these Amendments seriatim.

LORD BANBURY OF SOUTHAM

I have an Amendment in the proviso to subsection (1), and if the procedure proposed by the noble Earl, the Lord Chairman, is adopted I shall not be able to move it.

THE LORD CHAIRMAN

I am not proposing one procedure or the other. I am asking the guidance of the Committee as to which they would prefer to follow. But it is possible for the noble Lord, Lord Banbury, to move his Amendment as an additional Amendment if we can find a proper place for it.

THE MARQUESS OF SALISBURY

There is some difficulty in taking the noble Duke's clause as a whole, because there is certainly one Amendment which is not in the least inconsistent with the clause and which stands upon the Paper in the name of my noble friend Lord Melchett.

THE LORD CHAIRMAN

I agree.

THE MARQUESS OF SALISBURY

It would certainly not be convenient that it should be raised in the absence of my noble friend.

THE LORD CHAIRMAN

Perhaps it would be more convenient to take the Amendments in the order in which they appear on the Paper.

THE MARQUESS OF SALISBURY

This is for the Government to consider, but supposing your Lordships' House thought fit to carry the first of the noble Duke's Amendments, the Government would probably accept that as a decision upon the whole of his Amendments.

LORD THOMSON

Yes, quite.

LORD GAINFORD moved, at the beginning of the clause, after "If," to insert "upon representation being made to them by the owner or owners of a colliery undertaking in any district as aforesaid." The noble Lord said

The object of my Amendment, which is a very simple one, is to secure that anything that is done by the tribunal to deal with amalgamations shall be done, first of all, at the instance of one of the parties who desire the amalgamation, so as to prevent some busybodies interfering with industries about which they know nothing, and to ensure that there is a prima facie case made for an amalgamation scheme to be presented by an interested party who will have to make out a case for such amalgamation. I beg to move.

Amendment moved— Page 18, line 25, after ("If") insert ("upon representation being made to them by the owner or owners of a colliery undertaking in any district as aforesaid").—(Lord Gainford.)

LORD THOMSON

This Amendment is rather affected by what has gone before and what is coming after. Its effect is to deprive the Reorganisation Commissioners or, failing them, the Board of Trade, of the power of initiating a scheme without the consent of one of the parties who would be involved in that scheme. In other words, it takes us back to exactly the position we were in under the Act of 1926, and it exposes one particular individual in any district to the odium and unpopularity of having to initiate a scheme in the full knowledge of his associates. One of the principal objects of the Bill is to encourage amalgamation by removing that possibility; that is to say, that if a coal owner in any given district who in his heart of hearts believes that amalgamation is good and is in a position to indicate where amalgamation can be put through usefully and successfully, could go to the Commissioners and say: "I do not want this to be known, but in my opinion that is a good amalgamation," it is believed that many owners would do that. Whereas they do not do it now because they are afraid of being marked down as busybodies, or whatever the phrase is. I am afraid I must resist the Amendment. It is rather in suspense because I do not know whether the noble Lord would move his Amendment if the Board of Trade were the initiating party.

LORD GAINFORD

I want the present Amendment because the Board of Trade really know nothing about the interests which would be affected, and I do not think that an outsider can form any opinion as to whether an amalgamation is in the national interest or not. There is no hesitation on the part of an owner, if he realises that by acquiring an adjacent property which is worked by somebody else he can secure economy of production, taking steps to acquire that property. It seems to me that the initiation ought to come from some party who knows that it will be in the national interest for an amalgamation to take place. Otherwise you are leaving it, as I said, entirely to busybodies and agitators and other people who have no knowledge whatever of the circumstances.

LORD WESTER WEMYSS

The noble Lord has suddenly developed a great kindness for coal owners which the Government certainly have not shown before. Why he should be so anxious about the feelings of those gentlemen I do not know. My experience is that those who require an amalgamation have never hesitated to say so, without, as far as I can make out, very good reasons in the cases I know. But this forced amalgamation surely cannot be expected to have any good effects. It would really result in applying standardised methods and standardised remedies to varying evils. We have lots of evidence from noble Lords that in some parts of the world amalgamation is good and I am perfectly ready to believe, in fact I know, that that is so. But there are other parts of the world where amalgamation so far from doing good would be likely to bring ruin on the trade there. One of the mistakes made in this Bill is to treat the whole of the coal trade as if it was one and indivisible. It is not. Collieries differ from each other. Mines in different collieries differ from each other. How this forced amalgamation is going to affect the production of coal is more than I can see in all cases.

I suppose that the. Government think that the amalgamation in the coal trade, like amalgamation in some other businesses, will result in economy. Economy in what? Certainly not in management. Each pit is a separate unit and has, by law, certain officials to look after it. They cannot be reduced. The only way in which you can reduce them is by the equally impossible way of throwing one mine into another. It is thought that you may have some economy in the purchase of stores and so forth. That is quite illusory. Even now so great is the effort to get sales that you can secure your stores at quite low prices and you need not be frightened of that. If you think there will be economy in the general management I do not see how that can be. Each business amalgamated will have to have its own general manager as well as a general manager of the whole concern.

Apart from that, I think that forced amalgamation will bring forth strife just in the very place where we want to see peace most of all—amongst the coal owners themselves. Enough has been done to stir up and make differences between them. No real help has been given to the coal owners to settle their own business. They have had Government measures imposed upon them which many of them dislike, and now on the top of that some are going to be asked to amalgamate with concerns which on the face of things will be probably much worse than they are. The only thing I can see which would in any way justify such a scheme would be a clean, clear-cut purchase. Anything else, I think, would not only harm the owners and the coal trade, but would harm the country by lowering its standard of morality as to what is right and wrong.

VISCOUNT HAILSHAM

I am not quite sure that the exact effect of the noble Lord, Lord Gainford's Amendment is quite clear to the whole of your Lordships. Whether the Amendment is carried or not will not alter the question of whether or not there may be compulsory amalgamation. The effect of his Amendment, as I understand it, is this, that if his Amendment is inserted then it will be impossible for the Board of Trade to bring forward a scheme for amalgamation before the Railway and Canal Commission unless a particular owner has requested the Board of Trade to do so. In other words, it throws upon the owners of colliery undertakings which are proposed to be amalgamated the burden of moving the Board of Trade to initiate proceedings, and if they do that, then they are very much in the same position as if they made an application themselves.

I confess, if the noble Lord will forgive me, I think his Amendment goes just a little further than I personally should be prepared to support. I do not profess, of course, to have his intimate knowledge of the coal trade, but it has been represented to me that there are cases in which owners would not be sorry if an amalgamation were brought forward, but who are themselves unwilling to undergo the odium of bringing into Court, or compelling to be dragged into Court, people with whom they afterwards hope to work if the amalgamation goes through. Therefore, there may be cases in which people would not be unwilling for an amalgamation scheme to go through, but where they would not be prepared to take the burden or incur the odium, as I think the noble Lord, Lord Thomson, said earlier, of initiating proceedings. It seems to me that there is an Amendment a little lower down on the Paper which would really safeguard the position that the noble Lord, Lord Gainford, is anxious about, and which is not open to the same objection as is his Amendment.

It is on the next page of the Marshalled List in the name of my noble friend Lord Banbury, who proposes, in page 19, line 4, to move that— no scheme prepared under this section "— that is to say, under the compulsory amalgamation scheme— shall be referred to the Railway and Canal Commission unless the owner of at least one undertaking proposed to be amalgamated or absorbed by the scheme assents to the scheme being so referred. Under that Amendment it is not necessary for any individual who is to form one of the amalgamated undertakings to take the initiative, but it is saying that before a scheme is confirmed by the Railway and Canal Commission one at least of the undertakings proposed to be amalgamated is willing to take the burden of carrying the scheme through. I think probably the noble Lord's purpose would be achieved if he was willing to allow his Amendment to be withdrawn, and Lord Banbury's to be carried. I venture to make that suggestion to him.

LORD GAINFORD

I understand that Lord Banbury will move his Amendment, and I beg leave to withdraw mine.

Amendment, by leave, withdrawn.

THE DUKE OF NORTHUMBERLAND moved, in subsection (1), to leave out "Coal Mines Reorganisation Commission" and insert "Board of Trade." The noble Duke said: As I have already explained, the effect of this Amendment is very simple. It really substitutes the Board of Trade for the Coal Mines Reorganisation Commission. I do not want to keep the Committee more than two minutes, because this matter has already been discussed to some extent, but the noble and gallant Lord opposite made one or two remarks to which I think it is really necessary to make some reply. First of all I should like to make my position quite clear in regard to this Amendment. I have never seen the object of indulging in that rather futile and also rather humiliating exercise of moving Amendments in this House, and then, when they are returned from another place, running away from them. My object in this Amendment was so to alter this clause as to render it, comparatively at least, innocuous, and that, I think, the Amendment does. In view of other Amendments to this Bill, which no doubt we shall shortly consider, your Lordships may not see fit to adhere to more than one important Amendment if it is returned from another place. I think this is one Amendment which is not of such a drastic nature, and therefore your Lordships might adhere to it. That is the sole reason why I move it; not because I like compulsory amalgamation, or because I agree with the principles of the clause in the least. I think that makes the matter quite clear.

There are one or two remarks which the noble and gallant Lord opposite made to which I wish to reply. He asked, What difference is there between the Board of Trade and this roving Commission which is to be set up to bring about compulsory amalgamations where they are not effected voluntarily? I say that there is all the difference in the world, for this reason. The Board of Trade is not a body whose sole aim and object it is to bring about amalgamations in the coalfields of this country. It has a lot of other things to attend to, and it would only effect these amalgamations and make inquiries regarding these amalgamations if it received information that they were obviously desirable.

The noble and gallant Lord again says that the Board of Trade would have to spend quite as much money as this Commission is going to spend. Really I do find it a little difficult to accept that. Does he mean to say it would cost £250,000 a year? I think he said that it would cost £250,000 to set up this Commission. I speak under correction, but I have read the speech which the President of the Board of Trade made in another place, and, as far as I can recollect, he said quite distinctly that the expenses of this Commission would be £250,000 a year. I cannot believe that the officials of the Board of Trade, in conducting these inquiries, would spend anything like that amount of money. I am informed, and informed on very good authority, that as a matter of fact the Board of Trade has at its disposal all the information which is required about those amalgamations which are obviously desirable in the public interest, and which would be brought about were it not for some perhaps utterly unreasonable and recalcitrant owner.

The noble and gallant Lord also said that undertakings in which only 150,000 men had been engaged had in the last few years been included in amalgamations, and, he added, that that was a very small number, and at that rate it would take twenty-five years to amalgamate all the collieries in the country. But we do not want all the collieries in the country to amalgamate. I maintain that the number which has been amalgamated is a very considerable proportion, and includes a very considerable proportion of the miners who ought to be included in these amalgamated undertakings. I think I have now answered all the points which my noble and gallant friend raised, and I beg to move.

Amendment moved— Page 18, lines 25 and 26, leave out ("Coal Mines Reorganisation Commission") and insert ("Board of Trade").—(The Dyke of Northumberland.)

LORD THOMSON

I do not propose to take up your Lordships' time by answering in detail the noble Duke, for we have covered the ground. It is still my opinion that the Board of Trade has not got a staff to undertake the task of going round 1,400 colliery concerns in this country, with 2,500 producing units. They would have to employ people from outside; they would have to pay them high salaries, they would have to pay experts of various descriptions and indeed they would have to employ people exactly similar in character to the Commissioners. Perhaps the noble Duke attaches more importance than I to the difference between Tweedledum and Tweedledee, but that is about the difference as it appears to me. I shall have to resist this Amendment. I do not propose to ask your Lordships to go to a Division, but I shall declare myself Not-Content.

THE MARQUESS OF LONDONDERRY

The noble Lord has had on more than one occasion to make practically the same speech and I think your Lordships are aware that he has repeated one or two fundamental fallacies. He is objecting to the Amendment which has been moved by the noble Duke for the purpose of substituting the Board of Trade for the Commissioners, which was the provision in the Bill as it stood before the last Division. To the roving Commission I had personally very strong objections because I think your Lordships will realise that if an ad hoc Commission is set up that Commission is bound to do something. It would be quite impossible for them to occupy the position in which they would have been placed and to do nothing whatsoever, and after they had done a certain amount of work allotted to them under the Bill that Commission would then have vanished into thin air and would have been entirely irresponsible for any difficulties or drawbacks which might have arisen through the work they had done. That is why I should consider the Board of Trade an infinitely better authority for carrying out the work under the Bill. I am not prepared to say here that I am in favour of compulsory amalgamation, but still it is a principle which has been brought forward and which is legislatively enacted now. As the noble Marquess who sits behind me has said, that is a provision on which we have no intention of going back, and I would venture to suggest that the Board of Trade is an infinitely better authority than the Commission which it was proposed to set up.

One of the fallacies to which I referred when I began my speech is this—and I would almost challenge the noble Lord or any one who sits on the Benches opposite to contradict me—that the Board of Trade at this moment are very well aware of all those amalgamations which it is possible or which it is feasible should be made. Instead of enlisting the support and assistance of a large body of officials to go into matters perfectly well known to them now, they would simply draw on the knowledge which they have at the present moment—not locked away, but I should say in their hands at the present moment. They would be able to tell us which are the possible amalgamations, and the details are, at this moment, I should say, at their disposal. The machinery set up in the last four years has brought about a certain amount of change. It has brought about amalgamations which the noble Lord seems to think nothing of, but I certainly feel that in the four years when a number of amalgamations have been brought about that that is something which we should feel has been of value. I think the noble Lord is also well aware that there is a tendency abroad for amalgamations and that the coal trade is as susceptible to those influences as any other trade. I am quite sure that effective amalgamation in the coal trade will only be retarded by any undue compulsion. That is why I would far sooner see the normal process of amalgamation going on, assisted by what would certainly be the beneficent influence of the Board of Trade. I am quite sure that if this process goes on with the further restrictions which the noble Lord who sits behind me is proposing to put in the Bill, we shall see all those amalgamations which may be of benefit to the coal industry.

Perhaps your Lordships would allow me to say one word about amalgamation. There are certainly a great many misconceptions in the case of the coal trade, and I think many who are uninstructed on these matters think there is some practical value in amalgamating pit with pit. They look on coal mines as if they were factories, but that is not the case. The conditions applicable to coal pits are in many respects very widely different from the conditions which apply to factories. I have gone into these matters and I can tell your Lordships that there is very little saving of money by the amalgamation of two pits. I have perhaps gone further in the direction of wanting to see amalgamations in the coal trade than many of my friends, but I have been anxious to see amalgamations for selling coal and not for putting pits together, because I have always felt that that is attended with great difficulties. There is little saving of expense on the lines of rationalisation in the amalgamation of pits. I do not feel entitled to go further into this matter now and I will only say that I hope that your Lordships will see that the Board of Trade is the best authority by which amalgamation can be assisted.

LORD MELCHETT

I do not intend to continue the debate, but I would like to ask one question. Clauses 11 and 12 having been deleted, there is no Reorganisation Commission in the Bill. If, therefore, this Amendment is not carried, Clause 13 will become obviously impossible because some body that does not exist has to do something. If that is so, surely the noble Lord in charge of the Bill must accept this Amendment. Otherwise the Bill will leave this House reading in an absurd way.

On Question, Amendment agreed to.

THE LORD CHAIRMAN

I think the next Amendments are consequential and I may put them quickly.

Amendments moved— Page 18, line 33, leave out ("Commissioners") and insert ("Board") Page 18, line 35, leave out ("of Trade") Page 18, line 40, leave out ("Commissioners") in both places and insert in both places ("Board") Page 18, line 41, leave out ("and submit") Page 18, line 42, leave out ("to the Board of Trade") Page 18, lines 43 and 44, leave out ("and submitted by the Commission").— (The Duke of Northumberland.)

On Question, Amendments agreed to.

LORD BANBURY OF SOUTHAM moved, in the proviso to subsection (1), after "Provided that," to insert:— (a) no scheme prepared under this section shall be referred to the Railway and Canal Commission unless the owner of at least one undertaking proposed to be amalgamated or absorbed by the scheme assents to the scheme being so referred; (b) The noble Lord said: I rise to move this Amendment with the same feeling which I think the noble Duke had in moving his Amendment. I do not like it, and neither did the noble Duke like his Amendment, but I wish to make the best of a bad job and I think this Amendment, if accepted, would do something to mitigate the hardships and the futilities of amalgamation. Moreover, the result of this Amendment—and on this ground I would commend it to the noble Lord—would be to restore the Bill to the same position in which the Act of 1926 stood. The noble Lord is so fond of the Act of 1926 and thinks the Government of that day did so well that I am sure he will be prepared to accept this Amendment, and so, I think, will the noble and learned Marquess, Lord Reading.

The Act of 1926 provided that:— Where the owner of any such undertaking, or whore the owners of two or more such undertakings who have agreed to amalgamate, consider that in the interests of the more economical and efficient working, treating, or disposing of coal it is expedient that one or more other such undertakings, the owners of which are unwilling to agree to amalgamate or to agree to the proposed terms of amalgamation, should be absorbed wholly or partially …. then the Railway and Canal Commissioners should consider it and confirm it provided they are satisfied that it would be in the national interest to do so, and that the terms of the scheme are fair and equitable to all persons affected thereby.…. Therefore there was not an absolute similarity between the Act of 1926 and this Bill as it was introduced into your Lordships' House. I, by my Amendment, endeavour to put back the meaning, at any rate, of the Act of 1926. That does not mean that I agree with the Act of 1926, because I find that I voted against it; so I was in no way doing anything unreasonable when I made the observation a short time ago to the noble and gallant Lord that I should prefer to see compulsory amalgamation left out of the Bill.

The noble Lord said that everybody agreed with amalgamation. I venture to differ from him. If he had said that thirty years ago everybody—I mean everybody in business—was in favour of amalgamation, I could agree with him, but those were voluntary amalgamations and not compulsory ones. The only instance that we have, so far as I know, of compulsory amalgamation is the amalgamation of the railway companies. Those compulsory amalgamations were hailed by a large number of people, probably including the noble and gallant Lord, if he thought anything about those things at that time, as being a measure that would not only be advantageous to the public but would result in economies to the shareholders. Sir Eric Geddes, who was in charge of the Second Reading of the Bill in another place, said that some people estimated the saving at £40,000,000 a year, but that he did not estimate them at quite so large an amount, though he thought the saving ought to be at any rate £20,000,000 a year. In opposing the Second Reading I said that neither would it do any good to the public nor would it save any money, much less £20,000,000 a year; and I venture to say that I have turned out to be right, and that the compulsory amalgamation failed both to save money for the shareholders and to give increased facilities to the public. That being so, the noble and gallant Lord, in the face of an amalgamation that has failed, wishes to bring compulsory amalgamations to a large number of collieries.

Let me point out to him one or two objections to compulsory amalgamations. First of all, if I wanted to amalgamate with the noble and gallant Lord, or if we had any business together, we should be able to go into the thing and decide what terms we thought were right. The noble and gallant Lord would probably get the better of the bargain. But, if I were compelled to go into amalgamation with the noble Lord, I might be compelled to have a very bad bargain and I should have nothing whatever to say. The people who would adjudicate would probably not understand my business, and yet I should be obliged to accept their adjudication. What people have lost sight of is that amalgamations are advantageous so long as they are not too big, but directly they get too big it is impossible to carry on the management of the business. That has been exemplified in the railways, and the position is very nearly the same with the banks. They are not at present too big for management, but I think some of them are a little larger than they ought to be for efficient management. If you get a very big concern you cannot have efficient management. I am sorry to have digressed. If the noble Lord, Lord Gainford, will again act against his Leader, Sir Herbert Samuel, and move the omission of Clause 13, as amended, I shall be very pleased to vote with him. In the meantime I beg to move my Amendment.

Amendment moved— Page 19, line 4, after ("that") insert the said new words.—(Lord Banbury of Southam.)

LORD THOMSON

The noble Lord, Lord Banbury of Southam, has at length entirely convinced me that he is against compulsory amalgamations. I was in some doubt about it. This Amendment has very powerful support from the noble and learned Viscount, Lord Hailsham, but I cannot help thinking that the noble and learned Viscount has made an assumption that is not justified by the terms of the Amendment. As I understood him, when he was speaking on Lord Gainford's Amendment he implied that the assent of the coal owners could be given in secret, that it would not be published. I do not see anything to show that in the terms of the Amendment, which will not make a very vital difference in that respect. As a matter of fact, I think it is fair to say that the Board of Trade would not proceed with a scheme before the Railway and Canal Commission unless they were satisfied that at least some of the parties concerned were willing to go into amalgamation.

After all, the Board of Trade are sensible people, acting in the public interest, and they try to do their best. Is it likely that they would proceed with a scheme unless they were assured that anyhow one or more of the parties were in agreement with it? The Board of Trade has found a good many champions in this House. It is impossible that, with the facts and figures before it, it would make a mistake of that kind. I admit that, as a matter of common sense, it is very different to put into a Bill a provision that some owner should publicly assent to his name being published as the initiator of any particular amalgamation. If the noble and learned Viscount, Lord Hailsham, thinks that this Amendment means that it would not be publicly given, that puts a different complexion on the matter, but I have not been able to reach that conclusion.

VISCOUNT HAILSHAM

I certainly do not suppose that the assent would be kept secret. It seems to me that it would be a ridiculous proposal to suggest that the Board of Trade should come to the Railway and Canal Commission and say: "We are proposing to amalgamate A, B and C. One of them says he is afraid of his name being mentioned, so we cannot say who he is." That does not seem to me to be practical legislation at all. What I understood was that the Board of Trade, if the Amendment were carried, would be able to draft such amalgamations as they think would be valuable and to bring them before the Railway and Canal Commission, although nobody had asked them either to prepare a scheme or to bring it forward. But before they bring it before the Railway and Canal Commission they must be able to say that, if the thing goes through, So-and-So is prepared to work it. That does not seem to be an unreasonable arrangement.

The noble and gallant Lord, if I understood him rightly, argued that the Board of Trade would never do anything so ridiculous as to bring the matter before the Railway and Canal Commission unless they were satisfied that there was somebody who was willing to work the scheme. Obviously, if they are satisfied, there could be no harm in saying who he is, and that is all that this Amendment provides. It safeguards the position which the noble and gallant Lord pointed out earlier in our discussion—that people who might be quite willing to be parties to an amalgamation and to make it a success if it were carried through, would not care to incur the odium (to use his own words) of setting the scheme in motion against the will of their partners-to-be. It safeguards that position. The Board of Trade will take the initiative. It also safeguards the position which the noble and gallant Lord admits is a reasonable one—namely, that there must be somebody prepared to work the scheme before it is brought before the Railway and Canal Commission.

If it be true—and I am not denying that it may be true—that no reasonable Board of Trade would think of doing such a thing, then surely there can be no harm in having in an Act of Parliament a provision making it quite clear that it will not, because sometimes there are changes in a Government Department, and sometimes we find people—especially if a vast army of officials is going to be created, as the noble and learned Lord, rather to my dismay, adumbrated—anxious to justify their position by bringing forward schemes which, if more carefully considered, would never see the light of day. It is insisted that there shall be a condition satisfied, which the noble and gallant Lord admits to be a reasonable one, and all that the Amendment does is to put in black and white, as a term of the obligation, that that condition shall be satisfied which the noble and gallant Lord admits the Board of Trade ought to see satisfied before they move. It does not seem to me, after what the noble and gallant Lord said, that there can be any objection on the part of the Government to this Amendment.

EARL RUSSELL

The Amendment is, on the face of it, so specious and reasonable, as the noble and learned Viscount has been saying, that it may well be wondered why there should be any objection on the part of the Government to accepting it. There is, however, a perfectly real objection. It is perfectly obvious, as has been said, that you cannot imagine the Board of Trade proceeding with a scheme of amalgamation for four or five owners if every one of them has made it clear that they do not want to be amalgamated, and will not be, and will not make the scheme work if it is prepared, and are none of them prepared to operate an amalgamation scheme. There is, however, always such a thing as the question of "belling the cat," and it does happen, and I am given to understand it has been found to happen, that coal owners are very reluctant to take a step which might be looked upon with disfavour by their fellow coal owners in initiating a scheme publicly. The Board of Trade may well learn, however, that if a scheme were initiated there would be one coal owner willing to work the scheme of amalgamation, and it follows that if the Amendment were adopted you might have some amalgamations not taking place which would otherwise have taken place. Therefore, although the Amendment seems to be a reasonable one it would put difficulty in the way of some amalgamations and lead to a smaller number of them, and for that reason the Government, and those who advise the Government, think the Amendment is undesirable.

On Question, Amendment agreed to.

LORD COZENS-HARDY moved, at the end of the proviso to subsection (1), to insert "and belonging to or controlled by such undertaking through the ownership of the majority of share capital or otherwise." The noble Lord said: I move this Amendment with the object of making the proviso clear. The proviso in effect says that in the case of an undertaking of which the primary object is not coal mining no scheme of amalgamation shall, without the consent of the owner, provide for the separation from the undertaking of any coal mine worked as ancillary for such primary object. I think the proviso as it stands leaves it very doubtful whether it would apply to a coal mine worked as ancillary to the undertaking, but not legally part of it. My object is to make it quite clear that a case of that kind does come within the proviso. I am not sure that the words I have suggested are the best for effecting the purpose, but the noble and gallant Lord in charge of the Bill will perhaps consider the adoption of some suitable words.

Amendment moved— Page 19, line 11, after ("object") insert ("and belonging to or controlled by such undertaking through the ownership of the majority of share capital or otherwise").—(Lord Cozens-Hardy.)

LORD THOMSON

I very much regret that I have not had time to study this matter. It is the first time I have seen it, and perhaps the noble and learned Lord will bring it up on Report.

THE MARQUESS OF READING

Perhaps the noble and gallant Lord will take note of the observations of my noble friend. He wished to have the matter considered, and if the noble and gallant Lord will consider it before Report he will be satisfied.

LORD THOMSON

I will certainly do so.

Amendment, by leave, withdrawn.

LORD MELCHETT moved, after subsection (1), to insert the following 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 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 noble Lord said: The object of this subsection is to strengthen and improve the procedure under Section 7 of the Act of 1926, especially in view of the fact that further and newer powers are given under this Bill than were given under the Act of 1926. A good deal has been said this afternoon about the compulsory powers of the Act of 1926, and what happened at that time. I was one of those who were considerably concerned at the time about the Act of 1926, and I remember that Amendments were moved which were intended to strengthen the compulsory powers of that Act, and the then Minister for War, Sir Laming Worthington-Evans, who was in charge of the Bill, considered that there were sufficient powers under the Act of 1926. One does not want to cover the large amount of ground which has already been covered in discussion this afternoon. I think experience has shown that the Act of 1926 has produced as large and rapid a number of coal amalgamations as anybody could reasonably expect, and it is not really correct to say that the Act of 1926 was a failure. Under the Act of 1926 there were full instructions given to the Railway and Canal Commission in the consideration of schemes prepared by the Board of Trade.

The Amendment which I am now troubling your Lordships with is an Amendment to this effect:— 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)— (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 he 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."

It is obvious why these terms are included. If you introduce the principles of compulsion, and extend them, obviously that compulsion should not be used in the interests of a private person or a private lot of persons, but only in the national interest, where it is shown that the national interest would benefit. My Amendment deals, I think fairly fully, with that point.

You must remember that you are dealing, not with schemes agreed among the owners themselves, but with schemes prepared by the Board of Trade, to which obviously there may be a large amount of opposition. Otherwise the Board of Trade would never have been brought in to prepare the scheme. And, therefore, being a Government Department, the first point to which it obviously must look is the national interest. A great many amalgamation schemes are produced, and I have examined a great many myself in various industries. Although the authors all start with the general impression that the word "amalgamation" covers a multitude of efficiencies and financial gains, close examination does not always disclose where the amalgamation is going to produce any benefit, either in the cost of production or in efficiency of sales. That is a reason why a considerable number of amalgamations have really been failures instead of successes. Therefore, it is very important in a compulsory scheme of this kind that it should be quite clearly established to a judicial tribunal that there will be some beneficial result.

And then, further, my Amendment provides that an amalgamation scheme shall not be confirmed unless it is established that it "will not be financially injurious to any of the undertakings proposed to be amalgamated," and unless, of course, such an undertaking is bought out in cash. It is very unfair to ask people to take shares in an amalgamation scheme against their will unless they feel that the value of their shares is likely to appreciate, and therefore that the amount they are going to get from their properties will be very satisfactory. In all these circumstances I think the House can fairly ask the Government to accept the Amendment, which in no way affects the principle of the clause, but merely makes assurance doubly sure that any scheme submitted to the Board of Trade shall, like Caesar's wife, be above suspicion and receive the most careful examination.

Amendment moved— Page 19, line 11, at end insert the said new subsection.—(Lord Melchett.)

LORD THOMSON

The noble Lord's Amendment tampers with that sacred thing, the 1926 Act. If it has any effect at all it certainly would limit the powers of the Railway and Canal Commission as defined in Section 7 (2) (a). If it is the intention of the noble Lord to limit those powers, then it will interfere with the discretion of the Court, which is given very wide scope in the national interest. If it is going to impose upon that Court other conditions and limit their discretion, then this Amendment is undesirable; if it is not proposed to limit the discretion of the Court, then it seems to me that this Amendment is unnecessary. As regards the buying out of interests in an amalgamation for cash payment, I submit for the noble Lord's consideration that that is dealt with in Section 7 (2) (b) of the 1926 Act. I am not here defending the Government's Bill; at this moment I am defending the 1926 Act, and I submit that for that reason, if for no other reason, it would perhaps be desirable for the noble Lord not to press his Amendment.

VISCOUNT HAILSHAM

I only want to add one or two words, because this is to some extent a legal problem, and I gather we are not having the great advantage of the assistance of my noble and learned friend the Lord Chancellor in the discussion. The noble Lord who is in charge of the Bill has said that this Amendment tampers with the 1926 Act. If he looks at the Amendment carefully he will see that it relates only to those compulsory amalgamations which could not take place under the 1926 Act. It is limited to those compulsory amalgamations which take place at the instance of the Board of Trade. Under the 1926 Act it was the owners of the undertaking who brought the proposals before the Court; under this clause you are giving power to the Board of Trade to bring a bevy of unwilling owners before the Court as long as they can find one assenting person, and we are providing a certain protection in those cases and in those cases only. We are not altering the terms of the 1926 Act in any case to which the 1926 Act applies. We are only substituting these precautions in the case in which a power is given for the first time by this Bill.

Secondly, I would like to point out that it is quite true that these provisions to an extent limit the discretion of the Court. The noble Lord said if that was so they were necessarily undesirable, but indeed the 1926 Act equally limits the discretion of the Court, and of the three proposals here—(i), (ii) and (iii)—(i) and (iii) are merely, in effect, reproductions of the existing provisions of the 1926 Act. They are only set out again in a more convenient form because there is an added provision inserted. In the 1926 Act it is provided that the Commission shall confirm a scheme if satisfied that it would be in the national interest to do so—that is (i) of Lord Meichett's proposals—and that the terms are fair and equitable to all persons affected thereby—that is (iii) of his proposed subsection.

The new part of his subsection is (ii). That provides that the Railway and Canal Commission shall not confirm a scheme brought forward by the Board of Trade against the will of some at least of the owners, possibly of all but one of them, unless they are satisfied that the scheme will result in lowering the cost of production or disposal of coal—that is paragraph (a). I am sure that that is not unreasonable. Why should the Railway and Canal Commission confirm a scheme although they are not satisfied that any lowering of cost, either of production or of disposal, would result? That would be to confirm an amalgamation on the hypothesis that because it is an amalgamation therefore it is a good thing. That is a hypothesis which certainly does not commend itself to noble Lords on this side; at least, it does not to me. We are satisfied that some amalgamations are desirable, because they result in lowering of the cost of production of coal. Unless an amalgamation has that result there seems to us to be no advantage in it.

The second new point is that the Commission has to be satisfied that the proposals— 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, that you shall not compel a man to come into an amalgamation when you are thereby going to injure him financially. If you are going to compel him to come in, and the terms which you impose upon him would be financially injurious to him, he has a right to say, "If you wish to amalgamate me, and you are not willing to put me in as good a financial position as if you had not compulsorily amalgamated me, you must buy me out at a fair price." A very similar provision is contained in the Companies Acts, in which case, where there is an amalgamation between companies, provision is made for the protection of dissenting shareholders, that they can be bought out at a fair price. It is an analogous suggestion that Lord Melchett puts forward, and I venture to think that really there is nothing either unreasonable or impracticable in the limitations which he suggests upon the discretion of the Railway and Canal Commission.

EARL RUSSELL

I should not differ so much from the noble and learned Viscount who has just spoken as to the reasonableness of most of these proposals, but I think I can assure your Lordships that they really are unnecessary, and it is unwise to load the Bill up with unnecessary matter. You will see that this is, both in form and in fact, a substitution for part of the Act of 1926 in certain cases, and, following the analysis of the noble and learned Viscount, (i), as he says, is already there. But when you come to (ii) (a), affecting cases where the scheme "will result in lowering the cost of production or disposal of coal," that is a thing which you hope, but is it a thing which is capable of proof? Can you prove that the scheme will result in the lowering of the cost of production or disposal of coal? They are to be satisfied of that. One may really ask: Is it reasonable? Can a Court satisfy itself that that will result? The most it can do is to satisfy itself that every reasonable person hopes it will result. But you cannot bind it to make a prophecy of that sort. I am sure that the noble Lord who moved the Amendment, if he were to sit as an arbitrator or judge in this matter, would hesitate to say: "This will result in lowering the cost of production." The most he would ever say would be: "I hope and believe that it will so result."

LORD MELCHETT

I should say that I am satisfied on the evidence that it will.

EARL RUSSELL

This is putting it a great deal higher than that. When you come to paragraph (b) you have, of course, a provision for buying out. That is already possible. It is within the general powers of the Court to buy out or to order to be bought out dissentient persons who are being amalgamated and who think that they will be injured by it. I do not know that there is very much difference in this. The scheme is not to be confirmed if it is financially injurious unless it contains provisions for the purchase. I think probably a Court might take that view, but it is hardly necessary to instruct them to take that view, is it? They have quite clearly to be satisfied that it is financially injurious and if they are satisfied of that no doubt they would apply the powers which they already have as to buying out. Then as to the (iii) I am talking it for granted that that is in.

A NOBLE LORD

That is already in the 1926 Act.

EARL RUSSELL

For those reasons I submit to your Lordships that this Amendment is unnecessary to the Bill, and would complicate it with something that is not wanted.

LORD MELCHETT

Really the noble Earl has not shown that the Amendment is unnecessary at all. He criticised paragraph (a) on the ground that nobody would commit themselves in advance to a statement that a certain amalgamation scheme would or would not lower the cost of the production or the disposal of coal. We are not asking the Commissioners to prophesy. We are only asking the Commissioners to satisfy themselves on the evidence before them as to what the probable consequence will be. That is the point.

EARL RUSSELL

What is that but prophecy?

LORD MELCHETT

It is important when you get to paragraph (b) to remember that the powers exist, but there is no obligation on the Court to act in a certain way. The noble and gallant Lord who, if I may say so, is the dragon head of the conduct of the Bill also took much the same line. He said that the sacrosanct Act of 1926 had been touched by an irreverent hand. I never thought it was a sacrosanct Act and certainly it has been very much touched by the Bill before us. Therefore we are bound to take the utmost precaution in the new circumstances.

I would put this point to the noble Lords opposite. Why cannot they endeavour to satisfy the feeling of disquiet which exists to-day in business circles? After all, these Amendments are not personal expressions of opinion put forward in an irresponsible way. We mostly move them at the request of important organisations of employers in this country whose experts have spent weeks in studying the Bill and feel that they have some points of substance that they wish to cover. If they are unduly apprehensive why not satisfy their apprehensions? You are not risking much; in fact, you are risking nothing. If the thing is already covered you are doing no harm. But I do not think noble Lords realise to what a degree legislation of this kind does cause serious apprehension in commercial and banking circles. If they had really to deal with these things practically and to try to get money for collieries or underwriting for issues, they would realise to what an exaggerated extent, I might almost say, the business and commercial world is worried. If they can make a concession that costs them nothing to satisfy those whose minds are in a state of anxiety surely in their own interests and in the interests of the Bill they would be very wise indeed to make it.

On Question, Amendment agreed to.

THE DUKE OF NORTHUMBERLAND

I beg to move a consequential Amendment which stands in my name.

Amendment moved— Page 19, lines 14 to 15, leave out ("submitted by the Coal Mines Reorganisations Commission") and insert ("prepared by the Board of Trade under this section.").—(The Duke of Northumberland.)

On Question, Amendment agreed to.

VISCOUNT BERTIE OF THAME moved, in subsection (2), after the first "securities" to insert "or rights or property of whatever nature." The noble Viscount said: If the noble and gallant Lord in charge of the Bill will turn to this clause he will see— If the owner of any undertaking …. satisfies the Railway and Canal Commission that any money or securities belonging to the transferor undertaking formed, at the date of the passing of this Act, a reserve which, when the scheme was submitted, was not required for the efficient carrying on of the transferor undertaking, the Railway and Canal Commission shall not confirm the scheme except after making such modifications, if any, as may be necessary for securing that the money or securities will not be transferred to the transferee undertaking. I do not think the expression "money or securities" covers such a thing as an option to subscribe for shares at a certain price for a, certain period which might attach to securities forming part of the reserve fund, nor does it cover land. If the words I have put down are not the best perhaps the noble and gallant Lord will suggest other words which I shall be happy to accept. I beg to move.

Amendment moved— Page 19, line 19, after ("securities") insert ("or rights or property of whatever nature").—(Viscount Bertie of Thame.)

LORD THOMSON

The subsection as it stands in the Bill was moved by a Conservative Member in another place and the present wording was agreed and accepted. If your Lordships would like to accept the principle of this Amendment it might be possible to put in the word "property." The wide term "property" is a better one than the words as they stand in the Bill. It was not considered necessary by the draftsmen to widen the Bill in this way because the clause only deals with a certain kind of reserve fund, and the words already in it are wide enough to cover what the movers of it intended to cover.

VISCOUNT BERTIE OF THAME

Am I to understand from the noble and gallant Lord that they did not intend to cover land?

LORD THOMSON

As I understand this clause, it is a question of a reserve fund.

VISCOUNT BERTIE OF THAME

They might put that fund into property.

LORD THOMSON

If the noble Viscount will accept the word "property" instead of "money and securities" it ought to cover everything.

VISCOUNT BERTIE OF THAME

If your Lordships please I will move it in that form.

LORD DARLING

Before that is put I should like to say it seems to me a very dangerous word. In the Courts people do not talk of property if they talk accurately. You have property in something. It is not a substantive thing. You cannot see it or handle it. You have property in something. You may call it personal property or real property, but to put into an Act of Parliament simply the word "property" thinking you are putting in securities of all sorts would, I think, be a very dangerous thing to do.

VISCOUNT HAILSHAM

Again I cannot help regretting that we are deprived of the invaluable assistance of the noble and learned Lord who usually graces the Woolsack. This seems to be eminently a point on which his advice would be of great assistance to us as well as to the Government. I do not like accepting a word quite so hastily, and perhaps tale best plan would be that the Amendment should be dropped on the understanding that the Government will consult their legal advisers and the Lord Chancellor, and bring forward whatever they think is the proper word on the Report stage.

VISCOUNT BERTIE OF THAME

If the noble and gallant Lord would undertake to do that I shall be quite satisfied.

LORD THOMSON

I gladly accept that. This was debated in another place and this form of words was eventually adopted as most suitable. All the objections raised by the noble Viscount were put forward in that debate. I accept the suggested solution.

LORD JOICEY

It is an important matter and ought to be carefully considered.

Amendment, by leave, withdrawn.

THE LORD CHAIRMAN

The Duke of Northumberland's next two Amendments are consequential.

Amendments moved— Page 19, lines 34 and 35, leave out ("submitted to the Board of Trade") and insert ("referred to the Railway and Canal Commission") Page 19, line 35, leave out ("Coal Mines Reorganisation Commission") and insert ("Board of Trade").—(The Duke of Northumberland.)

On Question, Amendments agreed to.

Amendment moved— Page 19, lines 40 and 41, leave out ("Coal Mines Reorganisation Commission") and insert ("Board").—(The Duke of Northumberland.)

On Question, Amendment agreed to.

LORD THOMSON

The next Amendment is consequential.

Amendment moved— Page 20, line 1, leave out subsection (5). —(Lord Thomson.)

On Question, Amendment agreed to.

Amendment moved— Page 20, line 8, leave out ("Coal Mines Reorganisation Commission") and insert ("Board of Trade").—(The Duke of Northumberland.)

On Question, Amendment agreed to.

LORD THOMSON had an Amendment on the Paper to move, after subsection (6), to insert:— () No scheme shall be submitted or certificate granted by the Coal Mines Reorganisation Commission under this section except in pursuance of a decision made at a meeting at which a quorum of the Commissioners is present. The noble Lord said: This is consequential. We have altered the words to Board of Trade.

THE LORD CHAIRMAN

I understand the noble and gallant Lord moves this substituting the Board of Trade for the Coal Mines Reorganisation Commission.

VISCOUNT HAILSHAM

I really do not think it will read. There are no Commissioners, so how can there be a quorum of Commissioners?

LORD THOMSON

I think it comes out altogether.

Clause 13, as amended, agreed to.

House adjourned at twenty-five minutes past seven o'clock till tomorrow, three o'clock.