HL Deb 25 July 1946 vol 142 cc1000-20

5.20 p.m.

Order of the Day for the Second Reading read.


My Lords, I beg to move that the Cable and Wireless Bill, 1946, be read a second time. I hope to discharge my duty as rapidly as is consistent with the importance of this measure. I am encouraged to be fairly brief by the names of the speakers who are to follow me. It is a very great source of pleasure to your Lordships, and to myself, that the next speaker is to be the noble Lord, Lord Reith, whose standing in this field is unrivalled and to whose services in this whole connexion I would like, on behalf of the Government, to pay a very warm tribute. I would also add that in my eyes, and I expect in the eyes of most of your Lordships, the issues involved are not primarily financial or even in the narrow sense technical. They go to the root of all that we mean by Imperial co-operation in practice. Therefore, it is a source of great pleasure that the noble Lord, Lord Altrincham, is to speak from the Front Opposition Bench, and that the noble Viscount, the Secretary of State for Dominion Affairs, who leads the House, is to wind up the debate.

Although I intend to be brief, I will say—if I may slightly alter the distinction of the noble and learned Lord, the Lord Chancellor, between controversial and non-controversial Bills, into that of irresistible Bills and Bills susceptible of resistance—that this is essentially an irresistible measure. At any rate, I hope you will think so after I have spoken. This Bill proposes to transfer into public ownership the share capital of the great company known as Cable and Wireless, Limited, a company which to-day owns the greater portion of the world's system of cables, in addition to a very large number of wireless stations, a company in which the Treasury already hold 2,600,000 out of 30,000,000 £I shares, a company run since 1928 on semi-public utility lines. This public acquisition of the shares of the company is an essential first step in a far reaching scheme for reorganizing telecommunications within the Commonwealth. The scheme in question was unanimously recommended—I ask you to mark this sentence more than any other—by the Commonwealth Telecommunications Conference presided over by the noble Lord, Lord Reith, in August, 1945, and subsequently agreed upon by all the Governments of the Dominions and India.

When I recommend the proposal before us to-day as part of a scheme unanimously agreed upon by the Commonwealth Governments and by India, I do not want to be misunderstood. I do not want anyone to carry away the idea that we have been coerced by the Dominions into accepting a scheme which we ourselves do not like. I would like to make it perfectly plain, on behalf of the Government, that we regard the scheme derived from what I may call the Reith Conference as a thoroughly good scheme. We think it is good in itself. It is a strong and additional reason that it was approved by all the Dominions. I will not canvass the question to-day—I think it would be rather impertinent—of how far the late Coalition Government were committed to a scheme of this kind in advance of this Bill; I leave that matter to noble Lords opposite. I am sure that the noble Lord, Lord Altrincham, will agree that the scheme of which this Bill is an essential part is the logical outcome of several years' hard co-operative work and thinking on this subject by members of all Parties in this country and by all sections of the Commonwealth.

In order that your Lordships should understand why the Commonwealth Conference last year decided that so fundamental a reconstruction was necessary, I will explain briefly the nature of the existing organization of telecommunications in the Commonwealth. The set-up—if I may be allowed the expression—was and is very complicated. It is described with great care on Pages 1 and 2 of the White Paper (Cmd. No. 6805), which deals with the proposed transfer of Cable and Wireless, Limited, to public ownership. Broadly, however, the position as regards the overseas telegraph services of the partner Governments of the Commonwealth is as follows. All the overseas long-distance cables are owned by Cable and Wireless, Limited, who also operate them, except in the case of the cable heads in India and South Africa, which are operated by the local communication companies. In these companies Cable and Wireless, Limited, have the predominant interest. The overseas wireless services, with the exception of that of New Zealand, are operated by local companies, in which Cable and Wireless, Limited, have substantial holdings. In the case of New Zealand, the Government operate the overseas wireless service and, as is well known in the United Kingdom, certain services are operated by the Post Office.

To make the picture complete, one should add that in questions of policy, as distinct from ordinary business and management, Cableand Wireless, Limited, are required to consult the Commonwealth Communications Council, a body comprising representatives of the United Kingdom, the Dominions, India and the Colonies. In spite of that, I think it is a fair summary to say that, up to the present, Cable and Wireless, Limited, a United Kingdom company responsible to private shareholders, dominate the whole field of telecommunications within the Commonwealth. The set-up which I have described is no longer acceptable to the Commonwealth and India. Before the Select Committee of another place, the Financial Secretary to the Treasury was asked specifically: "Is it correct to say that the Dominions are not willing to contribute financially to the maintenance of the cable system so long as that system continues to be owned by Cable and Wireless, Limited, in its present form?" He replied, categorically, "Yes; that is their view." Therefore it must be clear to all that the existing arrangements must be radically transformed.

I do not see any cause for surprise in the fact that the Dominions have desired a change so strongly. I should have thought it surprising if they had continued to acquiesce in the existing set-up. The arrangements, good or bad, which have prevailed hitherto, are no longer consistent with the modern realities of Commonwealth relationships, and we have somehow to find a system—and I believe we have found one—which is consistent with those modern contemporary realities. If one may put the matter more concretely, the Dominions and India have expressed a desire to take a larger share in the Commonwealth telecommunications system—and a very natural desire, it seems to me. Three points are involved in this. In the first place the Dominions desire to control fully the local companies in which, as I have said, Cable and Wireless, Limited, have such a substantial interest. In the second place, they desire to have a greater say in the Commonwealth cable and wireless system as a whole. In the third place, they desire that that system should be more co-ordinated, to give more unity of policy and direction than it has done in the past.

These three objects are cordially supported by His Majesty's Government and will, I believe, commend themselves to all your Lordships. A fourth point, however, does arise out of them. The Dominions consider, and we agree, that only with a similar type of organization, broadly speaking, in the territories of the various partner Governments, will a really satisfactory result be achieved. It seems to them—and to us—impossible to have one kind of organization operating in, shall we say, New Zealand, and a completely different type of organization operating in this country. That leads to the conclusion that if the Dominions, as a whole, desire that the system in their countries should be publicly owned, if would be impossible for Cable and Wireless, Limited, to continue as a private company responsible to shareholders in this country.

These objectives, which were before the minds of the Reith Conference last year, were substantially achieved. I will not take your Lordships at length through the findings of that Conference, because they are set out very clearly in the White Paper, Cmd. 6805. I would refer your Lordships particularly to paragraph Io of that White Paper. There your Lordships will find altogether five points of unanimous agreement which were reached by the Telecommunications Conference presided over by Lord Reith. Four are listed on Page 5 of the White Paper, and a fifth point is to be found over the page. All those five points are, of course, accepted by His Majesty's Government, and in due course, where legislation is necessary on our part, legislation will be introduced to give effect to them.

The only point to-day which I would place before your Lordships as involved in the present Bill, and indeed, as in fact representing the burden of the present Bill, is the first point mentioned in paragraph 10 of the White Paper. The Commonwealth Telecommunications Conference is mentioned there as unanimously recommending that the private shareholder interest in the overseas telecommunications services of the United Kingdom, the Dominions, and India should be eliminated by the acquisition by the respective Governments of the shares in the companies. That is what we are doing under the present Bill in order to honour the agreement reached last year.

I will take your Lordships very briefly through the clauses of the Bill. Clause I provides for the complete transfer of Cable and Wireless, Limited, to the State in return for compensation paid in the form of Government stock. The amount of compensation is not fixed by the Bill. It is to be agreed or, failing agreement, to be determined by arbitration as provided in Clause 2. Clause 2 provides for the ascertainment of compensation either by agreement or by arbitration. If agreement cannot be reached, arbitration is to be resorted to, and the clause prescribes the constitution and terms of reference of the arbitration tribunal. Your Lordships who are interested in this great topic will have studied the Bill with care, and, therefore, I will not at the moment go into this clause in greater detail. I should just mention, in passing, what may not be in all your minds, namely, that in none of the proceedings in another place, including those before the Select Committee, was any objection made either to the form of the tribunal or to the principles upon which the value of the operating company was to be assessed. Clauses 3 and 4 are consequential and deal with matters of machinery.

Clause 5 deserves a separate word. It arises in connexion with the agreement reached between countries of the Commonwealth and the United States at the Telecommunications Conference held in November and December of last year at Bermuda, known as the Bermuda Conference. As explained in paragraph 16 of the White Paper, the line to be followed at that Conference had been discussed at what I will again call, if I may, the Reith Conference held during the summer of 1945. Full agreement, I would remind your Lordships, was reached at Bermuda between the countries of the Commonwealth and the United States, on outstanding telecommunication questions. In so far as the Bermuda agreement will have involved the company in a loss of revenue by any reduction of rates, compensation will be paid under Clause 5 up to the date at which the company is taken over. Clause 6 is interpretative. Clause 7 provides the Bill with its short title.

There are various other important grounds on which I have not touched, which might be employed to recommend this Bill to the House. There are diplomatic grounds and there are strategic grounds. There is the special case arising from the situation produced by the Bermuda agreement. No doubt your Lordships will wish to consider this Bill—which is to go, I may say, before a Select Committee—very carefully indeed, at all points of its progress; but to-night I will simply put it to you that this is a measure fully justified and indeed necessary, not only in the interests of Imperial communications, but in the interests of Imperial solidarity itself. I beg to move that this Bill be read a second time.

Moved, That the Bill be now read 2ª.—(Lord Pakenham.)

5.36 p.m.


My Lords, I think it is most unfortunate that a Bill of this importance should be introduced in your Lordships' House at this time of the day. I propose, however, to say the things that I had intended saying, notwithstanding the hour, because at least they will go on record in Hansard and possibly be of interest to other noble Lords at subsequent stages of this Bill. Might I congratulate the noble Lord who introduced the Bill? I think he did it clearly and excellently. He touched on the high spots without lingering long on them, and gave those of your Lordships who are here a fairly good idea of what is involved. The Bill was introduced in another place in these words: "Yesterday it was coal, to-day it is cables. The Socialist advance, therefore, continues." But, though in line with the Socialist advance; this Bill neither derives from it nor was inspired by it. I believe that the same Bill—at any rate a Bill for Government ownership of cables and wireless—would have been introduced by a Conservative Government if that Party had been returned to power.

Dissatisfaction with the existing system was expressed at the 1942 Conference and at the Commonwealth Communications Council's Conference in 1944, and the White Paper gives the conclusions and the recommendations on page 4. Cable and Wireless, Limited, were aware of these brewing discontents, though repudiating any justification for them. On the company's own initiative, a letter was sent in May, 1944, stating that, in the opinion of the company, a single Empire Corporation was the only satisfactory solution. That letter was referred to the Commonwealth Communications Council which was in session a day or two later. The Commonwealth Communications Council rejected the proposal with, as we thought, scant consideration. The Council advanced instead the scheme mentioned in the White Paper—that is, a series of public corporations linked by exchange of shareholdings, with the Commonwealth Communications Council as the central co-ordinating authority. Perhaps I had better read now 'paragraph 9, which deals with what the United Kingdom Government felt about it: These recommendations were considered by the United Kingdom Government at the end of 1944. While accepting the view of the Commonwealth Communications Council that there was a case for a fundamental change in the present structure of Commonwealth telecommunications services, the Government did not think that the scheme recommended by the Council would provide that degree of central co-ordination essential to secure the consolidation and strengthening of the wireless and cable system which was felt to be imperative. The united Kingdom Government accordingly, with the agreement of the other Commonwealth Governments, asked Lord Reith to undertake a Mission to the Dominions and India to explain the difficulties felt by the United Kingdom Government and to explore alternatives. So I left the Admiralty, where I knew exactly who I was, what I was and where I was, and proceeded with a party in a Liberator aircraft round the world. I was a member of the court of directors of the Cable and Wireless Company and their associated companies, and I was, therefore, party to the proposal for a single Empire Corporation. I was equally party to the company's criticism of the Commonwealth Communications Council scheme expressed in a letter of September, 1944. In fact, the United Kingdom Government and Cable and Wireless, Limited, had precisely the same misgivings about the Commonwealth Communications Council scheme. There was no embarrassment to me, therefore, and no conflict of loyalties, when I was invited by the United Kingdom Government to travel round the Commonwealth to explore alternatives. I greatly regretted then, and still regret, that this necessarily involved my resignation from the Cable and Wireless boards.

I would like to make clear that there was no criticism of Sir Edward Wilshaw or of the company's efficiency in my terms of reference. Sir Edward Wilshaw has given splendid Imperial service in the fifty-one years during which he has been associated with the company. There was no irreconcilable difference of opinion between what the company had recommended and what I felt might be produced as the result of my tour. Had there been either the one or the other I should not have felt able to undertake the responsibility. In fact, I accepted the Government's invitation with the entire approval of Sir Edward Wilshaw and his co-directors; they expressed in definite terms their satisfaction that one of their number had been invited by the Government to undertake that responsibility, and I think they felt, as I certainly did, that any agreement which might be achieved between the partner Governments, and recommended on my return to the United Kingdom Government, would be one which not only would I feel to be entirely workable but one which would commend itself to Sir Edward Wilshaw and his colleagues as workable.

The White Paper states that I returned with a large measure of agreement on modifications to the original scheme. That was in March, 1945, and we had travelled 45,000 miles and been absent only fifty- two days from the United Kingdom. But because of the imminence of the General Election, and because legislation was involved, the Government did not feel able to express a final opinion on the recommendations. They accepted them, however, as a basis for further exploration at a conference with the Commonwealth Governments, at which detailed plans were also to be prepared. I do not think Sir Edward Wilshaw or his colleagues expected me to return with agreement to a single Empire Corporation, and I did not myself expect to do so. I did hope to return with a scheme which would give what was required, even though it might appear to be more on the lines of the Commonwealth Communications Council scheme than of the single Corporation.

The scheme with which I returned did not, as I had hoped and expected, commend itself to the company. To my surprise and regret they decided otherwise. The scheme, which I felt and still feel to be entirely workable, which the United Kingdom Ministers of that day and of to-day consider workable, the scheme which the Commonwealth Conference with Ministers and senior officials from all the Dominions and India consider workable, is described by the company, with somewhat tautological insistence, as "unworkable and impracticable." I vastly regret it. Incidentally one of their objections is that the new central board will be too powerful. I think that they overrate its powers, but surely the more powerful it were the nearer it approaches the single Corporation of their original proposal.

Remember that some fundamental change was required, as the noble Lord has said. It is quite true, as has been suggested elsewhere, that some Dominions were more insistent than others. The fact remains that the Governments of all the Dominions and India accepted the Commonwealth Communications Council plan of may, 1944, and there was some annoyance among them that they had to wait till December to be told that the United Kingdom Government did not accept the plan but would send an emissary to talk things over with them. I was given no instructions at all. I should not have liked to be told what I had to try to get the other Governments to agree to. My task was to evolve if possible, in consultation with them, a scheme which, while not interfering with their sovereign rights, would give that measure of central co-ordination which was essential. It is true that the South African and Canadian Governments were not prepared to give de jure authority to the central board such as the other 'Governments would have given, but my own view, and the unanimous conclusion at the Conference, was that the full practicability of the scheme was not thereby impaired. Had I not been sure of this I should never have advocated it.

The present Bill covers only the first recommendation of the Conference, namely, acquisition by the State of Cable and Wireless, Limited, the operating company. Further legislation is required to establish the new central board, and to order the relationship between it and the national organization in this country. I think it is most unfortunate that it could not all have been done in the one Bill. I can, therefore, understand some of the doubts expressed in another place and by the company about the workability and efficiency of the plan, since no more information has been made available than is contained in the White Paper.

I follow up the point which the noble Lord made with great delicacy in his introduction. Five Coalition Ministers were chiefly interested in my tour; I know what they felt about the results; incidentally they were all Conservatives. This lack of fuller information must surely have been responsible for some at least of the disquiets expressed by Mr. Oliver Lyttelton in another place. Though a member of the Cabinet of that time he seems not to have known, or to have forgotten, what his colleagues felt. For the scheme which so many of them individually approved, which they accepted collectively for elaboration, and only refrained from pronouncing more definitely upon it because of the circumstances referred to, the scheme which responsible Ministers and officials from all over the Commonwealth unanimously and strongly endorsed in the Conference, is termed by Mr. Oliver Lyttelton "jumbled and ineffective. "He considers it "entirely unworkable."

If Mr. Lyttelton has in fact the respect for my business capacity which he was kind enough to express, I should have thought he would have assumed that under no circumstances whatever would I be party to a scheme which could justly be so described. If I knew no more about the difficulties and delicacies of a mission undertaken by him, nor of the details of what was achieved, then and at the Conference, than he can possibly know, I should, out of respect for his business capacity, if not out of respect for the Ministers and officials of the seven Governments concerned, retrain from using such expressions.

He said he thought I started out convinced that nothing but public ownership would satisfy the other Governments. He made quite a good point there. But if that was so, and if I did start out convinced that nothing but public ownership would satisfy the other Govern-melts, there was at least some justification for it, in view of their all having said so with tolerable clarity in 1942 and 1944. In fact, however, I was at great pains to investigate with each Government the possibility of the retention of private enterprise subject to any kind of modifications they might suggest. With one exception such an idea was dismissed, and the one exception made it clear fiat, although they would not themselves have raised the issue, they were supporting the others in it.

It is not a case of putting forward the best possible arrangement or, in other words, making the best of a bad job, as some might feel it. The scheme, in my judgment, is practicable per se. I am naturally as aware as anybody else can be of the difficulties of operation, and I do not under-rate them, but I have no doubt whatever of its practicability. As I have said, if I had been in doubt I should not have been party to it. But some of Mr. Olivet Lyttelton's doubts and some of the company's doubts (which, as I have said, are to me a matter of profound regret) might have been cleared had it been possible to publish a much more comprehensive White Paper.

To all the criticisms of the new central body and of its relationship with the national bodies there is an answer. I would mention one point as an example. It has been suggested several times -that the members of the new central board are not going to be resident in London, and people ask whether a board with such responsibilities can function properly when there is a chairman and a secretary in London and members all over the world. They will be in London; the members of the new board will all be resident here. I mention that merely as an example. There was a good deal of criticism elsewhere that the Government could not say what they were going to do with Cable and Wireless, Limited, when they had acquired it. I am not surprised. I wish that had been settled and announced. But what was still more surprising was that Mr. Lyttelton should have advocated, instead of a public corporation, that the whole of the responsibilities should pass to the Post Office. I think that must have surprised the Government too. Some of us may be in favour of the nationalization of some essential public services, where, for instance, there may be an irreconcilable conflict between the dividend motive and that of public service—from the managerial point of view I mean—but not if they are to become Government departments. Is that seriously advocated here?

I wish the Government could tell us what they are going to do with Cable and Wireless. As to its passing to the Post Office, five points arise. Has the Post Office not quite enough to do already? Can it conduct business in foreign countries, opening branch offices of the United Kingdom Post Office in foreign countries and throughout the Empire? Can it, with its close, detailed, Parliamentary control, and with its inevitably standardised Civil Service procedure, conduct a highly competitive business? What will be the effect on the other Governments if such a decision be made here, and what will be the effect on the whole structure of the scheme? What effect will it have on the further legislation? I hope that the noble Viscount may be able to tell us something about that. I wish also that we could be fold whether further legislation will be introduced in the autumn. That legislation is required to establish the new central board and to cover its relationship with the new national body which is to take over from the present company. I think that Dominion legislation is also affected and may be delayed until we have the whole legislation here. I ask your Lordships sympathetically to consider the whole plan—not just that part of it which is embodied in the Bill—to give your encouragement to this Bill and to the Government with a view to the full and speedy implementation of the whole plan.

5.56 p.m.


My Lords, after the violent gale from the northern latitudes which agitated your Lordships' House earlier in the afternoon we have passed into an evening of calm and if not somnambulent at any rate restful serenity. I shall do nothing to disturb that serenity so far as the proceedings on the Second Reading of this Bill are concerned. I do not wish to detain your Lordships for long, but I think it is important that I should say a few words to define the attitude to this Bill of those who sit with me and behind me. It is a Bill which has been the subject of considerable controversy, both within and out of Parliament, although as a matter of fact the Second Reading was carried without a Division in another place. It is, as your Lordships are aware, a hybrid Bill; it deals in the first place with the taking over of the assets of Cable and Wireless and with the establishment of public ownership of it. It also deals with compensation, and I understand that the subject of compensation goes to a Select Committee of this House. I will say no more about that since presumably, if there is anything to be said, it will be said when the matter returns from the Select Committee to this House, but I would like to make one comment upon this procedure. It seems to me to be extremely clumsy. The Bill is introduced in another place and goes to a Select Committee of another place. It then comes to us here and goes to another Select Committee, this time of this House. Is this not a case in which a great deal of time might be saved by the use of a Joint Select Committee, a thing well known in our constitutional procedure?


The noble Lord is no doubt aware that this Bill is going to a Select Committee of this House because a protest has been lodged? It does not go automatically.


I think both the original complaint and the protest might have been dealt with by a Joint Select Committee of both Houses of Parliament. It would have saved a great deal of valuable time if that had been done, and I do not think that the people who want to represent their case before these Committees of Parliament could complain of that procedure. At any rate, it is worth examination. As the noble Lord, Lord Pakenham, said, there is also elaborate provision for arbitration in the second clause of this Bill and I will, therefore, deal no more with that aspect of it. What I am concerned with is its main principle and I am glad to say that on this side of the House we support the main principle of this Bill, which is, in the first instance, to take the assets of this great system of telecommunications into public ownership. We support it, not, as noble Lords opposite will realize, from any ideological motives but because it is the result of a long series of representations from one or other of the Dominions, of consultations with the Dominions and of agreements worked out with the Dominions in conference.

It is perfectly clear that some measure of this kind has been necessary for a long time in order to maintain essential unity in the Empire's cable and wireless communications. The consultations and discussions began a long time ago. They have gone through the various stages, and certainly the stage for which the noble Lord, Lord Reith, was responsible when he was sent out on his mission to the Dominions, was most ably discharged by him. I have found myself in agreement with most of the things he said, and indeed I would only enter one caveat which it is perhaps desirable to enter upon discussions of this kind. It is that I hope it is not going to become a practice in discussions of this kind to reveal the names of the members of the Cabinet Committee. It is an unusual procedure and might lead, I think, to undesirable consequences. The noble Lord, Lord Reith, speaks with exceptional knowledge and experience upon this subject, and he certainly carried out his instructions when he travelled so rapidly round the Empire with marked ability, and brought home a scheme which reflected great credit on his negotiating powers.

Nevertheless, there has been and there seems likely to continue, a good deal of controversy here, for which, in spite of the serenity of the proceedings in this House, I cannot altogether absolve His Majesty's Government from responsibility. I think it is really due to three things, which I might mention. One is the fact that the Chancellor of the Exchequer, when moving the Second Reading of this Bill in another place. Opened on a strident Party note. I hope that that is not going to be a precedent in Bills dealing with Empire affairs. It is most undesirable, and in this case utterly unnecessary, because most of what was said on this question had really no bearing upon the attitude of the Party to which I belong—no bearing of any kind. I congratulate, by comparison, the noble Lord who moved the Second Reading in this House, and I await with confidence the speech which will be made by 3, the noble Viscount, the Leader of the House. I think this is a good example of the better way in which great questions are handled in your Lordships' House. The second reason why controversy has developed, and may increase, is that we have been given no idea of what is to happen on the appointed day. A board is to take the place of the present board. How is it to be constituted? Can we have an assurance from the noble Viscount, the Leader of the House, that it will contain men of long experience and knowledge of this great Imperial interest? We have heard nothing of the board which is going to take over on the appointed day, and we have no idea of the date of the appointed day. I hope we shall have some information about that.

The most serious ground of complaint is a ground to which the noble Lord, Lord Keith, called attention, and that is the fact that this Bill is only the first step in a much larger process. It takes over the assets of Cable and Wireless, but we are not told what is to be the shape of the ultimate organization. It may conceivably be handed over to a public corporation. It may be handed over to the noble Earl who controls tie Post Office. I hope very much that the latter course will not be pursued. I say that with all respect to the noble Earl, and indeed I should not be surprised if he agreed with me. We have had no information as to the link-up between the Dominions and this country, and between the various corporations. What is to be the constitution of the co-ordinated board, and what are to be its powers? I do not quite understand why there has been so much delay in producing information upon this subject. The recommendations of the Commonwealth Communications Conference which terminated at the beginning of last August have, I understand, been accepted by all the Dominion Government, and the re- commendations were quite clear. I cannot believe that the Government can have any intention of going back upon those recommendations now, but we should like to know what course of action they propose to take.

If I may dwell for a moment on the suggestion that the Post Office should take over this great responsibility, I would make the following objections to that course. As the noble Lord, Lord Reith, said, this is a question in many respects of dealing with great interests in foreign countries. A corporation can do that, but it is not so easy for a Government Department to do it. Indeed, I think if these things were handed over to a Government Department the consequences might be very serious. In the second place, without being ideological, I am sure your Lordships will in general agree that Civil Service management is undesirable in a competitive service of this kind, and more particularly in one which in modern conditions is going to call for great initiative, energy, invention and enterprise. Finally, to hand this over to the Post Office would be to go directly counter to the agreement which has been made with the Dominions—or at any rate to the general plan to which they have given their consent. I think the noble Lord, Lord Pakenham, said that it had been agreed that there should be set up in the Dominions and here corporations of a similar type.


Broadly similar.


I do not see how the Post Office can be described as a corporation of anything like a similar type. After all, it is a Government Department, and it is not similar to what the Dominions, so far as we know, are going to set up. I hope, therefore, that we shall have some light on the proposed general organization when we come to the Committee stage of this Bill after the Recess. Indeed, I hope it may perhaps be possible that the further Bill may be introduced about that time. It would be very useful if one could see the picture as a whole before any part of the necessary legislation leaves this House. Let me in conclusion repeat that so far as we are concerned we shall give our support to the passage of this Bill, and we shall look forward, with every desire to welcome it, to the further measure which must follow upon it.

We shall judge the proposals of His Majesty's Government in this matter in the light of three considerations which are not ideological in any way, but which are just plain common sense. Let me say what those are, and I am sure the noble Viscount who is going to wind up the debate will approve of them. The first is whether or not the proposals of His Majesty's Government provide for the greatest possible measure of imperial co-operation that we desire. The second is whether the arrangements are such as to promise a cheap and efficient service which is essential to Empire trade and to all phases of the Empire's common' life. The third is whether these proposals will give the Empire the maximum security in time of war. I believe those three criteria will commend themselves to His Majesty's Government, as they do to us on this side of the House, and it would really be a great satisfaction to us to know that they were accepted by the noble Viscount, the Leader of the House.

6.10 p.m.


My Lords, as the noble Lord who has just spoken said, I am sure we all welcome the degree of calm which has characterized the discussion on this Bill, although, speaking quite frankly as an old Parliamentarian, I should have said that our discussions on the Bill that preceded this one were remarkably harmonious on the whole. My Lords, as a matter of fact and of history, one of the first papers which was presented to me when I entered the Dominion's office bore the noting of the noble Viscount who leads the Party opposite and was connected with this very subject. I remember taking home the report of the noble Viscount and spending a long time in studying it, in order to make myself acquainted with its far reaching proposals. It is, as the noble Lord who has just spoken has said, more or less the joint effort of all the Parties, and so far as its outline and main scheme is concerned it has been continued from one to the other; and I should like to pay our modest tribute to the share which the noble Viscount, Lord Cranborne, had in initiating the negotiations from which this Bill derives. May I also be allowed to joie in the tribute which has been paid to Lord Reith for the most conspicuous and able part that he played in devising this scheme. To be frank, I was surprised that he turned out to be such a consummate negotiator. I had been under the impression before that he was rather a hard man, but he seems to have produced a measure of agreement from one end of the world to the other with remarkable rapidity. All I have to say is that in that achievement he is greatly to be envied. Others of us would be glad to pursue our aims with like success.

I will now proceed to answer a question which was put to me by the noble Lord opposite, the effect of which was: "Will the proposals provide the greatest possible measure of Empire co-operation?" He may be assured that that will be the governing objective. There is no difference of opinion on that. As to the value of this measure and its use for trade and intercourse, that, again, is almost axiomatic. As to its value as a safeguard in time of war, we all know that Staff considerations which are given to these matters have nothing whatever to do with Party politics. They are related to the merits of the case. We are just as much alive to these necessities as any Government which has existed in the past, or as any Government which will come into being in the future. I am not called upon to say anything in regard to the animadversions made by my noble friend Lord Reith upon some remarks of Mr. Lyttelton. We can, I think, leave those two protagonists to themselves. But it was obvious, I think, that Mr. Lyttelton was not very clearly informed as to the history of this matter.

So far as this Bill is concerned, as the noble Lord has already said, it is a necessary first step. We have been asked what the position is in regard to the Dominions and how far they have gone into the matter. I have here a statement giving precise information up to date. The position is now as follows: The Australian Government have just introduced to the Commonwealth Parliament legislation on the lines recommended. We have been shown the draft of the legislation which the New Zealand Government are proposing to introduce. Of course we cannot predict the form which it will ultimately take. In India, no legislation is required. The Indian Government have given to the Indian company notice of their intention to exercise their rights of option to purchase the company's undertaking. We are informed that it is the intention of the Union Government of South Africa to bring the South African company under public ownership. The form which this will take is still undecided, but such legislation as may be required will, we understand, be introduced in the Union Parliament in the next Session. In November last, Mr. Ilsley, the then acting Prime Minister of Canada, informed the Canadian House of Commons that the Canadian Government had indicated its willingness to nationalize external telecommunication services. We understand that legislation in Canada is contemplated after negotiations with Cable and Wireless, Limited, have been completed in the United Kingdom and this Bill has become an Act.

That gives, I think, a precise and definite indication of the position of the Dominions and India, and your Lordships will see that there is complete unanimity as to the objective. The noble Lord asked me something about the personnel when the board is set up. I cannot say anything of any particular individual; but the staff will, of course, be chosen for their fitness, and I should add that there will be representatives of the United Kingdom, the Dominions, India, Southern Rhodesia and the Colonies. The chairman will be chosen by the Governments concerned.


May I interrupt the noble Viscount? Is lie not describing the board that will ultimately deal with this? I was asking also about the interim board which will take over the assets.


That is another matter. I thought the noble Lord was referring to the Commonwealth Telecommunications Board. That was what I have been speaking about. May I now deal with the point raised by the noble Lord, Lord Reith? He said that he was sorry that the business was not dealt with as a whole in one Bill. May I tell him that, after very careful consideration of the whole case, it was considered to be necessary to deal with it in, shall we say, this rather piecemeal way: to acquire the assets of the cable and wireless companies in the way proposed by this Bill first and so to leave the way open for the Text operational step. I noted what the noble Lord opposite said as to the Department represented by my noble friend the Earl of Listowel. I can only say that the considerations he mentioned have already been in our minds, which I suppose will not surprise him. It has not yet been finally decided, however, what form the operating concern will take, because there are practically three possibilities, which the noble Lord has already mentioned. One is a Government-owned company, as this will be, namely, one owned by the Government when these shares are acquired; another is a public corporation; and the third possibility is that it should be managed by the Post Office. As to these three possibilities, at the moment I am afraid that I cannot go any further than to say that no final decision has been arrived at. But we are well aware of and impressed with the considerations which the noble Lord mentioned with regard to this being, shall we say, departmentalized. That brings me to the end of the questions asked. I may have given somewhat imperfect answers to some of them, but I can only say that I do not think it is necessary for me further to commend the Bill to your Lordships; the case for it is so evident and so generally approved. This Bill, my Lords, is an essential first step. It is true that by it we are not going the whole way but I can assure noble Lords, in Parliamentary language, that there will be no avoidable delay.


My Lords, before we come to the end of this debate, there is one word which has not been said which I would like to add. I take the view which the noble Lord, Lord Altrincham, has expressed, that for Imperial reasons this was an inevitable change. Nothing I have heard since has made me alter my view, but I would like to pay tribute to the work which Cable and Wireless, Limited, have done in building up this great Imperial network. There is no doubt that in time of peace and in the extremely difficult conditions of war the labours which they put in, often involving new networks and machinery, gave a great deal of power of a very valuable kind to this country. In this debate on the Second Reading of a Bill which severs their connexion with the Imperial network, that is something which ought, in all fairness to them, to be said.


With the permission of the House, I would say with what accord I support the words of the noble Viscount. In fact, I had intended to comment on this aspect myself, and I much regret that through inadvertence I omitted to do so. I agree with what the noble Viscount has said and I am sure that the great developments which have been made by the Cable and Wireless company have had an exceedingly important share in the development of Empire communications—a fact which we gladly acknowledge.

On Question, Bill read 2ª and committed; the Committee to be proposed by the Committee of Selection.