Lords Sitting of 23 June 1947

Preamble
The House met at four of the clock, The LORD AMMON on the Woolsack.
Prayers.

FELIXSTOWE PIER BILL.
Read 2a and committed.
LONDON COUNTY COUNCIL (GENERAL POWERS) BILL.
Read 2a and committed, the Committee to be proposed by the Committee of Selection.
LONDON COUNTY COUNCIL (MONEY) BILL.
Read 2a and committed.
LONDON PASSENGER TRANSPORT BOARD BILL.
Read 2a and committed, the Committee to be proposed by the Committee of Selection.
LONDON AND NORTH EASTERN RAILWAY BILL.
Read 2a and committed, the Committee to be proposed by the Committee of Selection.
FELIXSTOWE URBAN DISTRICT COUNCIL BILL.
Read 3a, with the Amendments, and passed, and returned to the Commons.

PUBLIC OFFICES (SITE) BILL.
KINGSTON-UPON-HULL PROVI SIONAL ORDER BILL.
MARRIAGES PROVISIONAL ORDERS BILL.
Brought from the Commons; read 1a; and to be printed.

BUSINESS OF THE HOUSE.
4.5 p.m.
THE SECRETARY OF STATE FOR DOMINION AFFAIRS (VISCOUNT ADDISON)THE SECRETARY OF STATE FOR DOMINION AFFAIRS (VISCOUNT ADDISON) moved, That Standing Order No. XXXII be amended by leaving out the words "and the doors shall be locked after the lapse of four minutes as indicated by the sand glass, or after such shorter time as the Tellers appointed on both sides may agree to." The noble Viscount said: My Lords, I was informed last week that some inconvenience had arisen in our crowded Divisions by reason of the fact that doors were unnecessarily closed. In order to facilitate the opening of a door, I think at the end of the Chamber, it is necessary for me to move this Amendment of the Standing Order, though I understand that the main door which is behind these Benches will require still to remain closed. I believe that this Motion is for the general convenience of your Lordships, and I hope therefore that it will be agreed to.
VISCOUNT SWINTON: My Lords, I am very much obliged to the noble Lord. He is making everything as agreeable as possible for us, which is his usual practice. I am grateful to him, and agree.
On Question, Motion agreed to, and ordered accordingly.

TRANSPORT BILL.
4.7 p.m.
House again in Committee (according to Order).
[The EARL OF DROGHEDA in the Chair.]
Clause 65:
Schemes as to harbours.
(6) No provision of any scheme made under this section shall apply to any private dock undertaking, oil dock undertaking, coal dock undertaking or drydock undertaking, unless either the person carrying on the undertaking consents to the application thereof or the undertaking is carried on in pursuance of some private Act or some order having the effect of an Act.
LORD ADDINGTON LORD ADDINGTON moved, in subsection (6), at the end, to insert:
"Provided that a person carrying on a private dock undertaking shall not unreasonably withhold his consent to the application of any provision of a scheme (other than provisions relating to the matters specified in paragraphs (b), (c) and (d) of subsection (3) of this section) to any part of the undertaking the activities whereof consist of the provision of port facilities for hire or reward, not being activities which were carried on by that person before the operation of the scheme."
The noble Lord said: This Amendment deals with the withholding of consent by a private dock undertaking to a scheme under the clause. I understand the terms of it have been agreed by all the interests concerned, so I need not go into it any further. It has been submitted to the Ministry of Transport. It seems to be reasonable, and I hope the Government will accept it. I therefore beg to move.
Amendment moved
Page 82, line 11, at end, insert the said proviso.—(Lord Addington.)
LORD MORRISON: I am sorry that my information does not corroborate what the noble Lord has said, that this is the result of an agreement. I am advised that it is true that in theory there is a possibility of some evasion of the principles upon which a scheme can be based. In the view of the Government,
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however, the practical possibilities of such evasion are negligible. To establish a private dock requires a great deal of capital expenditure in the provision of under-water works, quite apart from the capital expenditure involved in the manufacturing plant which the private dock is designed to serve. The Minister realizes that where docks are concerned, with the vast amount of capital which their construction involves and the differing types of circumstance affecting different localities, a clear distinction between work for hire and reward and work for other purposes cannot be drawn, and he feels that it would be unwise to attempt in this Bill to draw an absolute distinction, which in practice would often be unsatisfactory. If a private dock undertaking is excluded from the scope of a scheme by reason of its character, and subsequently it engages in hire and reward work it would lose its character of a private dock. I am advised that the only agreement which was reached was such a pale compromise that it would be scarcely worth putting into the Bill, and in those circumstances perhaps the noble Lord would withdraw his Amendment.
VISCOUNT SWINTON: I frankly did not understand very much of what this was about, but I should have thought, with great respect in view of the explanation that has been given, that it would be very unwise to add clauses of this kind to the Bill. The Commission have a complete power and duty to review all the docks and to make schemes. As I read the Bill, they have as much power in the matter of what is called a private dock as in that of any other dock, and if that is so it seems to me to be a pity, whether there is an agreement or not, to go and complicate it by provisions of this kind.
LORD ADDINGTON: In view of what has been said I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 65, as amended, shall stand part of the Bill:
LORD SALTOUN: Before this clause is finally passed, I would like to ask the Government two questions. Clause 65 (1) sets out that:
"The harbours to which this section applies … are all harbours in Great Britain which are, or form part of, or abut

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on, harbours not normally used only by pleasure steamers, yachts, fishing vessels, and vessels not required to be registered under the Merchant Shipping Acts, 1894 to 1940."
It seems to me that there may be some confusion about the words "abut on." For instance I do not think, at the moment, that the little port of Dunoon would be considered as abutting on either Glasgow or Rothesay. But I am wondering whether some words like "abut on the works of the harbours" instead of merely "abut on" are not called for here, because at a later period someone taking a vast view might think that almost anything abutted on the harbour with which he was concerned.
The other point is in regard to accepted harbours, which are defined as "harbours not normally used only by pleasure steamers, yachts, fishing vessels, and vessels not required to be registered under the Merchant Shipping Acts 1894 to 1940." While the principal Act, of course, does contain a definition which I think will cover that, some people who know a great deal more about this than I do, have suggested that that would bring in what are mere piers. As I understand it, it seems to be clear that harbours normally used for the fishing trade are not brought into the Bill, and I should be very glad if the noble Viscount who is in charge of the Bill could give me a reply on those two points, and perhaps an assurance.
VISCOUNT ADDISON: I will certainly have both points looked into and will inform the noble Lord as to the result. For my own part, I should have thought that the words "abut on" would be open to what might be called "commonsense interpretation" and would not be difficult to define, although I admit that I should be sorry to have to define them myself.
VISCOUNT MAUGHAM: There are three words or phrases which are often used in this connexion. One is "adjacent," another is "adjoining" and a third is "contiguous to." Perhaps one of those three might suit better than the words "abut on."
VISCOUNT ADDISON: I will make inquiries into these points, and if any alteration is necessary I will inform the noble Lord.
LORD SALTOUN: I am very much obliged.
Clause 65, as amended, agreed to.
4.14 p.m.
Clause 66:
Power to license provision of port facilities.
(3) Subject to the provisions of subsection (4) of this section, any such licence may be granted by the licensing authority for such period and subject to such conditions (including conditions as to the charges to be made by the holder of the licence) as the licensing authority think fit, and may at any time be revoked by the licensing authority:
Provided that the licensing authority shall not refuse or revoke a licence under this section or impose any conditions thereon, unless, in their opinion, it is expedient so to do with a view to securing the better use of the harbour in the national interest or the economical improvement, maintenance or management thereof.
LORD TEYNHAM LORD TEYNHAM moved, in the proviso to subsection (3), to leave out "refuse or revoke a licence under this section or impose any conditions thereon." The noble Lord said: For the convenience of the Committee may I suggest that the two Amendments standing in my name and the name of my noble friend, Viscount Swinton, on the marshalled list should be taken together, as the second one is really consequential upon the first. The object of the Amendments is to panicle for a minimum period of seven years for a licence to be granted under this clause for the carrying on of port facilities. As I understand that the Amendments are going to be accepted, I will not say anything further now. I beg to move.
Amendment moved—
Page 83, line 37, delete from ("not") by ("unless") in line 39.—(Lord Teynham.)
LORD MORRISON: It may also be for the convenience of the Committee if I say that this Amendment and the following one will be accepted.
On Question, Amendment agreed to.
LORD TEYNHAM: I beg to move the next Amendment.
Amendment moved—
Page 83, line 42, at end insert:
("either—

(i) or revoke a licence under this section or impose any conditions thereon; or

(ii) without the consent of the applicant grant any licence for a period of less than seven years.")—(Lord Teynham.)

On Question, Amendment agreed to.
Clause 66, as amended, agreed to.
Clause 67:
Right to require acquisition of undertakings providing port facilities.
(3) Any such order shall apply to the transfer, with such exceptions and subject to such modifications as may be specified in the order, the provisions of this Act relating to transfers of undertakings or parts of undertakings under Part III of this Act, including provisions as to compensation:
Provided that before making the order the Minister shall give the body specified in the declaration and the appellant an opportunity of being heard before a person appointed by the Minister for that purpose, and shall consider the report of the person so appointed.
LORD TEYNHAM LORD TEYNHAM moved, in the proviso to subsection (3), after "Provided that," to insert:
"(a) where the transfer is, in the opinion of the Minister, not comparable in the material respects with the form of transfer of the whole or part of an undertaking under Part III of this Act, the Order may provide—

(i) in the case of a transfer which, in the opinion of the Minister is comparable with the form of transfer of the whole or part of an undertaking effected under Part II of this Act, for compensation on a basis reasonably comparable, in his opinion, with that of the compensation provided under this Act in respect of that form of transfer; or

(ii) in any other case, for compensation in respect of the transfer, which in his opinion is proper compensation; and

(b)"
The noble Lord said: Paragraph (c) of subsection (1) of Clause 67 provides that where the tribunal are satisfied that their refusal to grant a licence for port facilities will involve a substantial interference with an ancillary activity the tribunal, on application by the appellant, may declare that the undertaking of the appellant, or some part of it, is to be transferred to the licensing authority or some other body. The object of this Amendment is to give the Minister power in appropriate cases to apply the same basis of compensation as has been laid down in Part III. The wording of this Amendment corresponds with the wording of Clause 36 which relates to the acquisition of carriers' undertakings. I understand that this Amendment may be accepted, and therefore I will not add anything further.
LORD MORRISON: The Amendment, I am pleased to say, will be accepted subject to the qualification that it may be necessary to review the wording slightly.
On Question, Amendment agreed to.
VISCOUNT SWINTON: We are very much obliged. I think we all mean the same thing. We want compensation to be fair and reasonable and to be as analogous as possible to the compensation to be paid under other Parts of the Bill. But you might easily get a case which had something to do with a part taken over but which was not strictly analogous to a railway or road transport or anything else in the Bill. Then, I suppose, the only way of doing simple justice is to give the Minister discretion to apply what the lawyers call cy près. I think that is a very good arrangement.
On Question, Amendment agreed to.
Clause 67, as amended, agreed to.
Clauses 68 and 69 agreed to.
Clause 70:
Advisory Committee as to coastal skipping.
70.—(1) The Minister shall establish a Coastal Shipping Advisory Committee for the purpose of considering and from time to time reporting to the Minister on all matters which may jointly affect the interests of the Commission and those of persons engaged in coastal shipping.
(2) The said Committee shall consist—

(a) of such number of members representing the interests of persons engaged in coastal shipping as the Minister thinks fit, to be appointed by him after consultation with such body or bodies as he thinks fit, being a body or bodies who appear to him to be representative of those persons; and

(b) such number of representatives of the Commission as the Minister may determine, to be nominated by the Commission, of whom one at least shall be a member of the Commission;

Provided that the number of members of the Committee representing the interests of persons engaged in coastal shipping shall not be less than the number of representatives of the Commission on the said Committee.
(3) The Committee shall appoint their own chairman from among their own members and their procedure, including their quorum, shall be such as they may determine.
(4) If the Committee make a report to the Minister with respect to any matter, the Minister may give to the Commission such directions as he thinks fit as to the exercise of the Commission's powers with respect to that matter (being directions which, in his opinion, it is necessary that he should give for securing that efficient coastal shipping services are maintained to the extent which he considers is required in the national interest), and the Commission shall give effect to any such directions.
4.18 p.m.
LORD ROCHDALE LORD ROCHDALE moved, in subsection (1), at the end, to insert:
"including in particular such matters arising during the preparation of drafts of charges

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schemes by the Commission under Section seventy-five of this Act or on the consideration by the Commission of any alteration or review of charges schemes promoted under Sections seventy-eight and seventy-nine of this Act."
The noble Lord said: On behalf of my noble friend Lord Roche and myself I beg to move this Amendment which stands in our joint names. This clause deals with the Coastal Shipping Advisory Committee which is set up in order to consider and report on all matters which may jointly affect coastal shipping, and the interests of the Commission. The purpose of this Amendment is simply to particularize and make quite certain that the matters that are to be considered and reported upon include the preparation, confirmation and review of charges schemes which are likely to affect coastal shipping. I beg to move.
Amendment moved—
Page 85, line 44, at end insert the said words.—(Lord Rochdale.)
VISCOUNT ADDISON: This Amendment is akin to one which appears on the opposite page. That Amendment is an Amendment: to Clause 75 at page 89, line 22. The Committee will see that these are Amendments which are akin, and I am advised that they are completely unnecessary. If you will look at the wording of Clause 70 (1), which appears at the bottom of page 85, you will see that the Minister is to establish a Coastal Shipping Advisory Committee
"for the purpose of considering and from time to time reporting to the Minister on all matters which may jointly affect the interests of the Commission and those of persons engaged in coastal shipping."
I ask the Committee particularly to note the words "on all matters." I am sure that all the matters referred to in the noble Lord's Amendment would be matters that affected both sets of parties. The Amendment, therefore, is completely unnecessary and I hope that the noble Lord will withdraw it.
LORD ROCHDALE: If the noble Viscount will give an assurance that the point raised in my Amendment is covered I will withdraw.
VISCOUNT ADDISON: I have given that assurance.
Amendment, by leave, withdrawn.
LORD TEYNHAM LORD TEYNHAM moved, in subsection (2) (a), after "persons," to insert "provided that each branch of coastal
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shipping shall be represented on the Committee." The noble Lord said: The purpose of the Coastal Shipping Advisory Committee is to advise the Minister on matters jointly affecting the interests of the Commission and persons engaged in coastal shipping. Clause 123, the interpretation clause, indicates certain well-defined branches of coastal shipping—tramp, tanker, Irish Cross Channel—and the relation of each of these branches within sea transport varies considerably. It is of great importance that their views should be represented, and the purpose of the Amendment is to see that every branch should be represented on the Coastal Shipping Advisory Committee.
Amendment moved—
Page 68, line 7, after ("persons") insert ("provided that each branch of coastal shipping shall be represented on the Committee").—(Lord Teynham.)
LORD MORRISON: I am advised that the difficulty about accepting this Amendment is that it might give rise to endless arguments as to what are the branches. There might be, I am told, a cross between tankers and liners, and possibly sailing barge owners might claim to be included as well as passenger liners if they developed. The Minister responsible for general overseas shipping, including coastal shipping, will take steps to see that all main branches of coastal shipping are given adequate and proper representation, and if the noble Lord cares not to press his Amendment I can give an undertaking to that effect.
LORD TEYNHAM: In view of the assurance I do not wish to press the Amendment.
Amendment, by leave, withdrawn.
4.23 p.m.
LORD TEYNHAM LORD TEYNHAM moved, in subsection (4), after "Committee," to insert "or a majority of the members of the Committee representing the interests of persons engaged in coastal shipping." The noble Lord said: Under subsection (4) of this clause, the Minister cannot exercise his power of giving directions to the Commission for securing that efficient coastal shipping services are maintained unless he receives reports from the Coastal Shipping Advisory Committee to be set up under the clause and then only in relation to matters on which a report is asked. It is important that

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the Minister should be kept aware of the views of the Coastal Shipping Advisory Committee and to ensure that a majority of members of the Committee representing coastal shipping should be able to make their Report to the Minister apart from the Committee as a whole. I am aware that in another place it was laid down that 50 per cent. of the Committee should be representative of coastal shipping. This does not go quite far enough. It would still be possible for representatives of the Commission on the Committee to prevent views of coastal shipping interests from reaching the Minister.
Amendment moved—
Page 86, line 19, after ("Committee") insert the said words.—(Lord Teynham.)
LORD MORRISON: I hope the noble Lord will not see fit to pursue this Amendment. It seems to me to visualize a somewhat undesirable practice, with some members of the Committee having more power than others. Already 50 per cent. of the Committee will be representative of coastwise shipping, as the noble Lord said; and in addition the Committee has power to appoint its own Chairman. It seems to me that the picture the noble Lord has in his mind of the proceedings of this Committee is not what we all hope it will be. The Committee will be a body of sensible men who will reach sensible solutions on matters which may be in dispute between them. I am advised that in the opinion of the Government if a few of them should exercise more power than the others this might make difficulties in getting a good working Committee together. In these circumstances I hope the noble Lord will not persist.
VISCOUNT SWINTON: Nobody wants to do anything which will in any way discourage the Committee from working as a harmonious team. On the other hand, the position is not quite what the Minister has stated it to be. Supposing you have two sides with no relations to the Minister, 50 per cent. on one side and 50 per cent. on the other, then his argument would be quite sound, that if you gave one 50 per cent. a chance of representing their views to the Minister and not the other, you would be putting the first 50 per cent. in a special position. But your Lordships will observe that the constitution of this Committee is not two lots of equal num-
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bers, both independent of the Minister, or enjoying the same relations with him, but one is the shipowners who are outside, and the other is the Commission, who are responsible to the Minister and in daily touch with him, and would be in a position to represent their views to the Minister.
I do not want to encourage difficulties on this Committee, but it may be equally important to give to both sides a sense that they are going to be able to have their views fully represented. If the Commission always had the opportunity of presenting their views, where they differ, even in a matter about which the shipowners were unanimously in favour and the shipowners had not an opportunity of getting to the Minister, there might easily be a sense of unfairness, and I am not sure there would not be unfairness. What happens when the representatives of the Commission take one view and the shipowners collectively take a different view and you have fifty-fifty? It is true you have a Chairman appointed by the Committee. It may be wise to leave that to the Committee. The Committee could either appoint one of their number or have an entirely independent chairman.
VISCOUNT ADDISON: No, it must be from their own members, if the noble Viscount will look; but they can determine their own procedure.
VISCOUNT SWINTON: Again we are in a rather funny position—unless this is put in. If a shipowner representative is chosen as chairman, under the ordinary procedure of committees if there is a tie the chairman has the casting vote. But if the chairman voted for the shipowners the representation would go to the Minister, and if he voted anti-shipowner the representation could never go to the Minister. The chairman may be in an invidious position. It may be putting an invidious duty on the chairman, and also putting rather a premium on either side getting the chairmanship. I am not trying to make dialectical difficulties, but I have had so much to do with working committees. I am not saying this is exactly how to do it but if the noble Viscount would like to consider the matter further perhaps my noble friend might reconsider his Amendment. I would not like to leave it as it is.
LORD MORRISON: I wonder whether the noble Viscount has envisaged the position that the Committee have powers to arrange their own business and might try having an alternate chairman for each meeting representing both sides. That is quite a practical method.
VISCOUNT SWINTON: That is quite common. They do it in U.N.O.
LORD MORRISON: I know also that the noble Viscount has no faith in what he calls Parliamentary assurances, but I can give an assurance that the Minister would not swamp the Committee with representatives of the Commission.
VISCOUNT SWINTON: He could not do that under the Bill; they have to be fifty-fifty. Believe me, I am not accusing the Minister of anything. Anyway, if he wanted to do the wrong thing he could not do it—it has got to be fifty-fifty. I do not know whether he or the Commission appoint their people—I think he does —but they have to be fifty-fifty. I do not want to waste time over this, but I really would like it looked at between now and the Report stage in order to see whether some assurance can be given. If there is a perfectly genuine conflict of opinion, where the whole of the Commission's representatives take one view and the shipowners another view, it would be rather an important issue. It would be upon an issue where the coastwise shipping thought that something the Commission were proposing to do was inimical to coastwise shipping. I am quite sure the coastwise shipping people ought not to have the decision, and I am equally certain that the Commission ought not to have the decision. It is not just an issue between two people with conflicting interests, for the whole interests of the country are bound up with coastwise shipping. I think there is a genuine difficulty to be met here. I am quite content if it goes to the Minister—I am not quarrelling with that at all. I do think that in a conflict of opinion of this kind everything ought to get to the Minister, otherwise he would have only the Commission's view before him.
VISCOUNT MAUGHAM: I would like to add just a word, if I may. It seems to me that this clause does need a little amending, because it does obviously lead to the possibility that if the Commission and the members who represent the coast-
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wise shipping take different views on arty subject, there may be a deadlock. The clause is important because the Minister is only given these directions under subsection (4) if the Committee make a report to the Minister. But suppose they cannot make a report because they are divided. Suppose one of the representatives of coastwise shipping takes a view which is not that of the majority. In that case they can never get their views before the Minister within the terms of the Bill, and it seems to me very desirable that those deadlocks should be avoided by some further Amendment to this clause.
VISCOUNT SWINTON: We all want the thing to get to the Minister on an issue like this, because otherwise nothing may happen at all and that would be very unsatisfactory. I am quite content that the Minister should exercise all his functions. Suppose there is a complete divergence of opinion. I do not think it ought to rest with the chairman to give a casting vote. It might be very embarrassing for him whether he was permanent chairman or not. I think if words could be considered to say that where there was a fifty-fifty division of opinion—and for that reason there could not be a report to the Minister—there should be a report setting out both conflicting views and leaving it to the Minister; that would meet the point.
VISCOUNT ADDISON: We will certainly consider that point. Of course the fifty-fifty point mentioned by the noble Viscount would not necessarily arise under this Amendment. I cannot imagine myself that any sensible Committee, making a report to the Minister, would not report the divergence of views. However, we will look at it.
VISCOUNT SWINTON: I rather agree. This seems to me to be the obvious thing in a rather peculiar position.
LORD TEYNHAM: In view of the fact that the Government are willing to consider a rewording on the Report stage, I do not propose to press the Amendment.
VISCOUNT ADDISON: We will consider whether we think a rewording is necessary, but we are not pledging ourselves to a rewording.
Amendment, by leave, withdrawn.
On Question, whether Clause 70 shall stand part of the Bill:
EARL HOWE: On the question whether Clause 70 be agreed to, I want to ask His Majesty's Government a question. As your Lordships probably know, there are a certain number of foreign ships engaged in coastal shipping. What I want to find out is what will be the position of the foreign ships in the coastal shipping traffic. Will, for instance, those responsible for British coastal shipping be regulated, co-ordinated, directed, and all the rest, while the foreigners will be left free?
VISCOUNT ADDISON: I cannot imagine that happening at all. I am quite sure that what applies to coastal shipping would apply to coastal shipping generally. I will certainly look into the point and obtain an assurance for the noble Earl, but I am quite sure that would be the case.
Clause 70 agreed to.
Clause 71 [Renaming of, and other provisions as to, Railway Rates Tribunal]:
VISCOUNT ADDISON: I understand that in order to widen the scope of the tribunal so as to include persons who may be users, it is necessary that the words proposed in the next Amendment should be inserted. I beg to move.
Amendment moved—
Page 87, line 2, at end, insert ("the words 'upon the railways' shall be omitted and").—(Viscount Addison.)—
On Question, Amendment agreed to.
Clause 71, as amended, agreed to.
Clause 72 agreed to.
Clause 73:
Transfer of jurisdiction of High Court, etc.
(2) On any such application the tribunal may make such order as may be just, and, save as expressly provided by this Act, no other court shall have jurisdiction in the case of any such contravention as aforesaid.
VISCOUNT SIMON VISCOUNT SIMON had given notice of an Amendment in subsection (2)—namely, after "jurisdiction," to insert "save by way of appeal under Section seventeen of the Railway and Canal Traffic Act, 1888, as applied by Section twenty-six of the Railways Act, 1921."
VISCOUNT ADDISON: In the absence of the noble Viscount, may I make a statement here? I consulted the noble Viscount about this and, of course, without presuming to commit him, I think he agreed with me that if you look at
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page 145, paragraph (5), it is almost in the same words and the point is really covered.
VISCOUNT SWINTON: This is a highly complicated legal point, and I think we had better leave it for the present.
Clause 73 agreed to.
Clause 74 agreed to.
4.38 p.m.
Clause 75:
Charges schemes.
75. The Commission shall from time to time prepare, and submit to the Transport Tribunal for confirmation, drafts of schemes (hereinafter in this Act referred to as "charges schemes") for determining, as respects the services and facilities provided by the Commission to which the schemes respectively relate—

(a) the charges which are to be made by the Commission; and

(b) where it is necessary or expedient so to do, the other terms and conditions which are to be applicable to the provision of those services and facilities, including, in particular, terms and conditions as to the liability of the Commission for loss or damage,

and it shall be the duty of the Commission, within two years from the passing of this Act or such longer period as the Minister may allow, to prepare and submit the draft of a scheme or, as the case may be, drafts of a series of schemes, relating or together relating to all the services and facilities provided by the Commission which the Commission are of opinion should be dealt with by charges schemes or which the Minister may direct to be so dealt with.
LORD BEVERIDGE: The Amendment standing in my name on page 89, line 20, to leave out certain words at the end of the clause, has its effect fully covered and, if I may say so, much better covered by the Amendment which follows immediately on the Paper standing in the names of the noble Earl, Lord Howe, and the noble Lord, Lord Balfour of Burleigh. Therefore I do not move my Amendment. I shall support their Amendment when it is moved.
LORD BALFOUR OF BURLEIGH LORD BALFOUR OF BURLEIGH moved to leave out "which," where that word occurs a fourth time ["which the Commission"] and insert: "under paragraphs (a) to (c) of subsection (1) of Section two of this Act and such other of the services and facilities provided by the Commission as." The noble Lord said: I confess that I had hoped the noble Lord, Lord Beveridge, would have explained

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the purpose of the Amendment, but unfortunately he has left it to me. Clause 75 is rather complicated to my way of thinking, although I have no doubt it is quite clear to the legal brain. I do find it rather difficult to understand because it begins by saying,
"The Commission shall from time to time prepare, and submit to the Transport Tribunal for confirmation, drafts of schemes … for determining … the charges"
Then it goes on to say that they shall prepare a draft, and later on it says:
"and it shall be the duty of the Commission, within two years … to prepare and submit the draft of a scheme …"
What the Amendment in the name of my noble friend and myself seeks to procure is to lay the duty upon the Commission to prepare charges schemes within two years in respect of (a), (b) and (c) of Clause 2 of the Bill.
If your Lordships will just look at Clause 2, your Lordships will see that that is the clause which gives the Commission power, in subsection 1 (a), "to carry goods and passengers by rail, road and inland waterway"; in (b), "to provide, within Great Britain, port facilities and facilities for traffic by inland waterway"; and in (c), "to store goods within Great Britain …" The remaining paragraphs (d) (e) and (f) deal with ancillary matters. I must confess that since this Amendment was put upon the Paper I have had some doubts whether it is really in the best form, because it seems to me, quite frankly, to give the Commission a duty to do certain things, and if we leave the words in it gives them a complete freedom whether they will do those things or not. I am not entirely satisfied with the wording, but I think it best to move the Amendment in this form and see what the Minister has to say about it. I rather hope something of the kind will appeal to the Government, because I think they want these charges schemes prepared within two years. I beg to move.
Amendment moved—
Page 89, line 20, leave out ("which") and insert ("under paragraphs (a) to (c) of subsection (1) of Section two of this Act and such other of the services and facilities provided by the Commission as").—(Lord Balfour of Burleigh.)
VISCOUNT ADDISON: Subject to possible modifications in the wording, we are prepared to accept the two Amendments of the noble Lord, which really hang
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together. We have a little doubt whether paragraph (c), which deals with storage, is applicable, as a vast number of people in all kinds of ways might be affected by storage. With that reservation, and subject to consultation with the noble Lord if any alteration is necessary, we are prepared to accept the two Amendments.
LORD BALFOUR OF BURLEIGH: Would the noble Viscount prefer that I withdraw the Amendment now?
VISCOUNT ADDISON: No. We are prepared to accept them, subject to the reservations which I have mentioned.
LORD BALFOUR OF BURLEIGH: I am obliged to the noble Viscount.
On Question, Amendment agreed to.
LORD BALFOUR OF BURLEIGH: I beg to move the next Amendment, which I understand to be included in the acceptance of the noble Viscount.
Amendment moved—
Page 189, line 21 leave out from ("schemes") to end of clause.—(Lord Balfour of Burleigh.)
On Question Amendment agreed to.
Clause 75, as amended, agreed to.
Clause 76 agreed to.
4.44 p.m.
Clause 77:
Confirmation of charges schemes.
(2) An objection to a draft scheme or any other representation with respect thereto may be lodged by any of the following bodies, that is to say—

(a) any body representative of any class of persons using the services or facilities to which the scheme will relate;

(b) any body constituted for the purposes of any scheme for the carrying on, under national ownership or control, of any industry or part of an industry or of any undertaking, being a body using the said services or facilities.

(4) Any scheme confirmed by the tribunal shall be published in such manner as may be specified by the tribunal in confirming the scheme and shall come into force on such date or dates as may be so specified; and the scheme shall have effect notwithstanding anything in any statutory provision.
LORD GIFFORD LORD GIFFORD: moved, in subsection (2) (a), after the first "any," to insert: "persons or class of persons or any." The noble Lord said: In moving

19
this Amendment, which stands in the names of the noble Earls, Lord Selkirk and Lord Rothes, and myself, I should like, first of all, to say that it is one of a series of Amendments dealing more or less with the same subject. Perhaps it would be convenient to the noble Viscount in charge of the Bill if I mention the other Amendments at the same time, so that he will know to which I refer. They include the one immediately following, page 90, line 38. There is also an Amendment being moved by the noble Lord, Lord Teynham, which is slightly wider but covers rather the same subject. Then there is an Amendment to Clause 78, page 91, line 31, and there are two to Clause 79, page 92, line 44, and page 93, line 5. If I could say a word about all those Amendments together, I think it would save the time of the Committee.
The general purpose of these Amendments is to give the independent operator a reasonable right to make representations about charges schemes to the Transport Tribunal; that is to say, in regard to fares charged by the Commission, or any body set up under Clause 63, in respect of passenger road transport services which affect another operator. If the independent operator does not have this right, I think he might well be unfairly treated, in that there might be different fares charged, or unfair competition, along the same route or in the same area. At the present time the Commission have the right to appeal to the Traffic Commissioners against the fares being charged by the independent operator, but the independent operator has no right to appeal to the Transport Tribunal in respect of fares charged by the Commission. We feel that the best answer would be that all fares should be subject to the Traffic Commission, but I do not think I need argue that now, as a great deal has already been said upon it. But I think it is only right, in fairness to the independent operator, that this Amendment should be accepted, as it puts both the Commission and the independent operator in a position to appeal if they think there is anything in the fares being charged which is against their interests.
I feel sure the noble Viscount in charge of the Bill desires to give the independent operator as fair a deal as possible, and I hope that he will feel able to accept
20
this Amendment. I would like to say that if the noble Viscount feels that the particular Amendment which I am moving is drawn rather widely, the Amendment immediately following, or the second one, to be moved by the noble Lord, Lord Teynham, would meet the case. We would prefer that this Amendment should be accepted, but if not, perhaps the noble Viscount will consider the following Amendment, so far as the road transport is concerned, or the noble Lord, Lord Teynham's Amendment with regard to its application to other people beside the road transport operator. I beg to move.
Amendment moved—
Page 90, line 31, after the first ("any") insert ("persons or class of persons or any").—(Lord Gifford.)
VISCOUNT ADDISON: Might I perhaps ask the Committee if they would be willing to consider this group of Amendments together? I think there are no fewer than ten relating to the same kind of question of appeal to the Transport Tribunal; then there is a group which relates to a class of persons; there is another Amendment, in the name of the noble Lord, Lord Beveridge, to Clause 78, which deals substantially with the same point; and there is a further Amendment by the noble Lord who moved this Amendment, in the same words, but relating to Clause 79, page 92, line 44. All those Amendments deal substantially with the same point relating to "person" or "persons." There is also another group, three in number, dealing with persons providing passenger road transport services, whose interests will be affected. There is the one moved by the noble Lord himself—on page 90, line 38. Another in the same words, relating to Clause 78, deals with alterations; and a third relating to Clause 79, and dealing with review, is in exactly the same words. And there is a further Amendment, also in the name of the noble Lord opposite, which is somewhat wider still. I suggest that it would be convenient that we should discuss the whole of these at once.
VISCOUNT SWINTON: I think that would be most convenient. We had better deal with the whole three, and decide what we should do with them. I fully accept that suggestion.
VISCOUNT ADDISON: We have given a great deal of thought to these Amendments and we are very anxious to be fair and at the same time not to cumber up the Tribunal with an impossible number of applications or objections which might delay its findings, not for months merely, but for years. We have to be careful about that. I understand, for instance, that the Railway Rates Tribunal need something like two years before they can wade through all the various applications. Therefore, so far as persons are concerned, I do not think it would he reasonable to insert an Amendment of that kind, because if the word "persons" is there anybody might come who might have had trouble over a parcel on the railway or something of that sort, and an unimaginable complexity of complaints and appeals would arise. Therefore, I think in any case, whatever we contemplate, it ought to be limited to a body which is the bona fide representative of an interest, rather than open to individual persons, which would make the proceedings of the Tribunal impossible. It should be a responsible body representing a group of persons.
As the case is at present, as the noble Lord justly said, representations are confined—Clause 77, subsection (2)—to a body representative of any class of persons using a service. Then, in paragragh (b), there are the words "any body constituted for the purposes of army scheme for the carrying on under national ownership or control … being a body using the said services … "Therefore, it does not, as it stands, cover the kind of case which I gather is in the minds of noble Lords opposite. I understand that what they are thinking of is that where the Commission provide a scheme to take over road passenger services by which another person or body of persons is affected, those persons might say "this body is putting the fares too low and we should have an opportunity of being heard."
VISCOUNT SWINTON: Or too high.
VISCOUNT ADDISON: Or too high. But that is not so easy to imagine, and surely it would enhance their profits.
VISCOUNT SWINTON: Or drive the users all on to the railways.
VISCOUNT ADDISON: As the noble Lord says, it may make a difference as between road and railway. But the point we are now considering is that noble
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Lords are wishful that persons who are carrying on transport, whose interests would be prejudiced by the scheme of the Tribunal, should be given arm opportunity of being heard. That is really what, it comes to. I think we have to avoid any repetition of the endless proceedings which I understand took place before we had the Railway Rates Tribunals. I think that any body of persons prejudicially affected, or thinking they are so, must be represented by a responsible body. There cannot be casual or accidental appeals, otherwise the Commission would be inundated. I think the point is a fair one, but we have to meet it sensibly, and not to make the proceedings of the Tribunal impossible.
If a man says this scheme is going to put him out of business, before the scheme is adopted he is entitled to have his say. I think that could be accepted as a general principle of fairness. We are anxious to see what we can devise, and to meet what is really the essential point covered by these Amendments. I have had a provisional statement drafted out since we discussed the matter earlier in the day, and we might perhaps consider this: that representative bodies of providers of transport, other than the Commission—that is the point—shall have the right to apply to the Tribunal for a locus to be heard in regard to charges schemes relating to the services with which they have to compete, on the ground that charges are unduly low; and that representative bodies of users of services of the Commission other than those to which the particular charge scheme applies shall have the right to apply to the Tribunal to be heard on a review. That is in Section 79. It would be only on the ground of a charges scheme being unduly low, as a result of which traders using other services might pay too much. That is the suggestion which I make, to try to meet the point in fairness without making the proceedings of the Tribunal impossible. I hope that noble Lords will be willing to consider it.
LORD TEYNHAM: I am sure we on this side are very grateful for the noble Lord's statement. This group of Amendments is really very complicated. The Amendments raise a vast subject, and I think it will be to the greater convenience of your Lordships if I deal with the three Amendments—one on Clause 77, one on

23
Clause 78, and one on Clause 79. As the Bill is drawn, the Commission could make charges for services and facilities at the railway and canal ports, but they might not put these charges at a proper economic level to attract traffic to these ports. It is quite obvious that the rates and charges which are on an official basis might have the most serious effect on independent ports. I think that the port under the control of the Commission should make their rates relate to the others. At the present time, the docks and harbour undertakings are not controlled by the railways. They have the right to make representations to the Railways and Canal Commission. The Railways and Canal Commission now becomes the Transport Tribunal, and they have been able to make representation on the subject of adequate charges by the railway companies for competitive services. Under this Bill there is no provision at all for independent docks and harbour undertakings to make representations to the Transport Tribunal, which of course is to replace the Railway Rates Tribunal.
The object of the Amendment is to give independent docks and harbour undertakings the right to appear before the Tribunal if they wish to object to a charges scheme, but I should like to point out again to you that Clause 77 and the two following Clauses, 78 and 79, are all confined to the right of appearance before the Transport Tribunal of users of the services or facilities which are the subject of a charges scheme. That would give no right to persons providing competitive facilities such as canal carriers, warehouse keepers, lightermen and barge owners irrespective of the fact that such persons and organizations may be adversely affected by the contents of a charges scheme. This Amendment is devised to cover those interests as well as docks and harbour undertakings. If we go a little further and take the case of the canal carriers, they will be unable to appear before the Transport Tribunal unless this Amendment is accepted, although a charges scheme might affect their operation and might even drive them out of business. It is true that an Amendment was agreed to in another place to Clause 36 whereby, if a licence were refused to canal undertakings, they could apply to be taken over by the Commission, but this is no safeguard for a carrier driven
24
out of business by an unfair charges scheme which may have no relation at all to the economic level of the operation. It is only fair that a canal carrier should have the right to appear before the Transport Tribunal to argue his case.
There is also the case of the warehouse-keeper to be considered. Under Clause 2, subsection (1) (c), the Commission are given power to store goods, and in fact will be able to operate an extensive warehousing business. It would be possible, if not probable, for the Commission to make charges which are not necessarily related to the economic level but perhaps on a cut-price basis to attract business. Therefore, warehouse-keepers should also have the right to make representations to the Transport Tribunal on any matters affecting warehouse charges and services embodied in a charges scheme. Lighter-men are affected by this clause, and they might find themselves in the same position in relation to the Commission as the canal carriers; they should also have the same right to appear before the Transport Tribunal. But, apart from these matters they might be directly concerned with the quotation of a through rate in a charges scheme to and from a port which might be proposed by the Commission. This through rate would be partly met by charges to lighterage services provided by the Commission at a rate which did not represent the true values of the economic level of the services; therefore, this is an additional reason I think for lightermen and barge-owners to have the right to appear before the Transport Tribunal.
I should like to point out that the words "or similar to or comparable with services or facilities which are ancillary or subsidiary to the services or facilities to which the scheme will relate," which were adopted in the Amendment, have been included to cover cases where a through rate embodied in the charges scheme is partly made up of the charges for services and the facilities for a dock controlled by the Commission, like the railway docks, and will enable an independent dock authority to object to the Transport Tribunal on the grounds that part of the through rate charged by the Commission and controlled by them was unduly low and could not be justified as an economic level. The point of all these things is the basis of economic level. Under Clause 76, subsection (1) (d), there is a provision that in special cases persons affording services

25
or facilities, in competition with the Commission are able to make representations to the Transport Tribunal, but I should like to point out that, in addition to the reservation for special cases, the right of appeal would be dependent on the discretion of the Commission and there is no machinery that I can see in the Bill whereby an interested person can appeal against an order of the Tribunal which does not recognize this right of representation. The Amendment has been widely drawn in order to be of general application and to prevent any suggestion that certain interests are being considered or preferred. It is merely to ensure what is right and equitable and that interests affected by a charges scheme should not be denied the right of appearance before the Tribunal. I am afraid this is a very complicated set of Amendments but I hope that I have made my points clear.
VISCOUNT SWINTON: I should like also to thank the Government for this very genuine effort to get the right solution of what we all agree is a problem that must be solved. I should say at once that, as regards the user, there ought to be a representation for the user and that you cannot have every user in the country going to the Tribunal. I do not think that ought to be a difficult thing to arrange. It was difficult to follow when it was read out, but there was one point on which I ventured to interrupt the Leader of the House on the reading of his suggested words. He seems to think that the only objection that would be likely to be taken would be taken if the fares were too low. The user would not be likely to take objection if the fares were too low—no, but I think it is just as likely that the provider of alternative transport might easily object, and have a right and duty to object, if he thinks the fares are too high.
After all, what is the purpose of this? You are now in this large combine going to assemble the whole of the railways and a very large part of the passenger road transport and road haulage transport in this country. One of the objects very clearly in this plan is that under the name of "co-ordination" a great deal of traffic may be put back on to the railways; in fact the railways have got to be made to pay. That can be done in one of two ways under this combination. It can be done by taking a large part of the profit which
26
is made by the Commission's road haulage and paying that in to reduce or or eliminate the deficit upon the railways. On the other hand, in the rates which are proposed to the Tribunal, it may easily be that the Commission will propose that the road rates shall be put deliberately high in order to attract the traffic back to the railways and that a rate may be imposed which is far higher than the permitted independent operator could quote.
The duty of the Tribunal is to hear all these objections and to come to a conclusion. I venture to dwell on that because I am sure the noble Lord will agree that that is indeed a contingency to be guarded against, although not to be prejudged. I am not seeking to pre-judge anything, but I suggest that certainly the Tribunal should have all this before it, and should have before it proper representation of the people who are affected, be they the suppliers of the transport or the users of the transport. Therefore, I am sure when we come to settle words we must not limit ourselves to objections to charges on the ground that they are too low; we must be equally able to object to charges which are too high. All these kinds of people, I think, who are dealt with in this Amendment are to-day entitled —are they not?—to appear before the Railway Rates Tribunal.
VISCOUNT ADDISON: No.
VISCOUNT SWINTON: Yet I would have thought that certainly prima facie anybody who is to-day entitled to appear before the Railway Rates Tribunal ought to be able to appear before the Transport Tribunal, unless the Government can show that such right of representation has been abused. But, there again, the right way of dealing with that is not to cut out the kind of person who has had the right to appear, but to vest in the Tribunal the right to refuse to hear frivolous applications. There may be a body which ought to be heard, and there may be other people whose application might be too frivolous because they were undoubtedly small. Therefore, I would say that prima facie anybody who has had a standing before the Railway Rates Tribunal ought to have a standing before the Transport Tribunal. That may not carry us the whole way because, whereas the Railway Rates Tribunal has had jurisdiction only over railway rates, this Transport

27
Tribunal is going to have a complete jurisdiction over not only railway rates, but over road haulage and all road passenger transport which the Commission thinks it right to put before the Transport Tribunal in its general structure of rates.
I am not at all sure that the thing does not, as it now stands, expand and go a great deal further. It may go to all these storage charges, it may also, directly or indirectly, greatly affect dock charges as well. Obviously, provided you get the people who are to have a standing before this tribunal—solid, substantial, representative people—then quite clearly there ought to be a standing for every class of person who is likely to be affected, or can be adversely affected by this plan. Provided these matters are all taken into consideration—and I think we really mean the same thing on this—then I do not think it ought to be difficult for us to find a right form of words.
LORD BEVERIDGE: I am sure the Committee ought to be grateful to the Leader of the House for taking these Amendments together. I am satisfied with his answer in regard to my Amendment, and when the time comes I shall not move that Amendment. I am sure we all agree that it ought to be possible for any user who has a real interest to find a body to represent him. While I do not propose to move the Amendment which stands in, my name, I would like to support the argument that has been made from the Front Opposition Bench for making it quite certain that all the different types of transport undertakings which will be in competition with one another and with the Commission have a fair opportunity of going before the Transport Tribunal. That was, in fact, the object of the Amendment which has just been accepted, requiring charges schemes to be made more general, because it is only when there is a charges scheme that the Transport Tribunal comes in. That was the object of the Amendment which was accepted on Clause 75. So far as I am concerned, provided that the Government realize, as I think they do, the necessity of giving confidence that there is going to be fair treatment and fair opportunity before the Tribunal for all the different forms of transport undertakings which compete with the Commission, I personally would leave it
28
to them to find the appropriate words for securing this. At any rate, I shall not move my own Amendment. I hope they will find words which do give complete confidence that there is going to be a fair and equal opportunity both for getting high enough rates and for getting low enough rates for all the different forms of transport before the Transport Tribunal.
THE EARL OF SELKIRK: The noble Viscount has been so reasonable in meeting this matter that I hope he will not mind my making this suggestion. I do feel, however, that the noble Viscount, Lord Swinton, was making it a little too narrow in confining it to competing for too low a fare. There are one or two other considerations that arise, and probably others that one can think of. First of all, we are going to have the country divided up into fifty-mile circles, or twenty-five mile circles, as was originally stated in the Bill. All the people in those circles are going to be dependent upon transport. They are, therefore, not competing, but they are extremely interested in the fares at which goods and passengers are delivered. If I may take an obvious example, take Inverness. There is only one way of getting there, substantially, and that is by rail. There is a considerable tourist interest there, and it may be that with the development of hydro-electric power there may be an industrial centre there. They are quite interested in the cost at which deliveries are made.
In Clause 76 (1) (e) there are the words "in all or any cases, leave to the Commission the determination of the charges." That means to say that the charges can be determined over a very wide area by the Commission without reference to the Tribunal. No doubt that will meet the point of congestion of work. Under the schemes which arise under Clauses 62 and 63, there are a great variety of methods to be employed. I do not think anyone knows yet what the plan of the executive is going to be, but may I take the case, for instance, of a local authority? A local authority may very well be asked to carry on its own transport. Is that local authority not going to have proper access to the Transport Tribunal which will ultimately govern its rates? It surely is interested both in regard to high and low rates, and I think definitely that such

29
an organization should be given an opportunity of appearance and representation before the Tribunal.
There is one other point which I would like to refer to, if I may, on the same lines, and that is in Clause 64 which says that the Commission may provide a service "under the preceding provisions of this Part of this Act or otherwise." The noble Viscount did not recognize the word "otherwise"; but it is there and it means to say that a scheme can be provided or transport permitted under almost any scheme under any system in the world, and I think that anyone in that position should be allowed to have access to the Tribunal.
VISCOUNT ADDISON: I am grateful for the way in which my suggestion, which was made in the very best faith, has been received. Of course, we have to remember that the Commission have got to make their scheme a scheme that will pay. They cannot deliberately make it uneconomic. Another consideration which we must have in mind is that a scheme must not be made such that the tribunal's proceedings will be so encumbered with all manner of representations that it will become virtually impossible for them to conclude those proceedings within any reasonable time. I understand with regard to the Railway Rates Tribunal that an altogether unreasonable time has been taken up in dealing with a number of appeals, many of which were not really necessary for consideration. We have to frame a scheme which will make this at all events workable. With that proviso, I say that I am quite sure that I am at one with the noble Lords opposite in my desire to try to secure that a body of responsible people, as the noble Viscount, Lord Swinton, has said, shall have a chance of stating their case when they think that a scheme prejudicially affects them. I do not wish to be tied down legally to a form of words but that is what I mean.
I am not quite sure whether the objection of the noble Viscount as to a charge being low is really very valid. If a scheme of charges were fixed which was too high as regards rates for road transport versus rail, it would be their scheme of charges. If any other contractor was able to operate on those roads, then he could make his own charges, provided he was not in the scheme. It would be open for those not
30
in the scheme to benefit by the charges if these were too high. I cannot see how they would be prejudiced. I am willing to have this matter looked at fairly, but I must say that the only case I can imagine where people would be prejudiced is where the charges were fixed too low. I cannot imagine their being prejudiced otherwise. I will have this looked at with the best of good will. I am not to be tied to these particular words, as I say, but I cannot see where that sort of case is likely to arise. I will consult with noble Lords opposite and others as to a suitable alternative form of words a long time before we get to the Report stage. There will be no immediate hurry about this. But we are sympathetic and wishful that responsible persons who feel that they may be prejudiced by the scheme of charges, should be given a chance of stating their case. With the co-operation of noble Lords opposite I will try to do as I have stated.
LORD GIFFORD: In common with other noble Lords responsible for the Amendment at present before the Committee, I should like to express with great sincerity our thanks to the noble Viscount, the Leader of the House, for having so readily accepted in principle that it was fair that the other road transport operators should have an opportunity of making representations before the Transport Tribunal.
There are just a few other points I would like to make before withdrawing the Amendment. The first is this. The noble Viscount, I think, said that sometimes a case is before the Railway Rates Tribunal for as long as two years. With all due respect, I do not think that anything like that would be the case with regard to road transport affairs. The issues would be far more simple, and would be of a character which could be decided fairly quickly. As to my second point, I should like to give one instance as to how I think the question of objection to high fares might arise. On several roads in the vicinity of big towns, road transport operators at present often have a minimum fare, in order, sometimes, to protect the municipal vehicles operating in the same area. Supposing, under a scheme, the Commission took over a certain route, ran, say, three-quarters of the vehicles on that route, and the Commission decided to put on a minimum fare

31
on that route in order to protect, we will say, a suburban railway covering the same distance. That minimum fare might easily drive a very large number of passengers away from the independent operator. So, if I might suggest it, perhaps the noble Viscount would agree that instead of using the word "low" we might use some such form of words as "not unreasonable fares."
Just one other point also. The noble Viscount said, there will be nothing to prevent the independent operator charging a different fare if he likes. I do not think that the Traffic Commissioner would agree to the independent operator charging a different fare over the same route. Indeed, I am sure of that. So the independent operator would be affected as well as the Commission. With those few words, and in view of the assurance which the noble Viscount has given us we may be able to get together upon this whole series of Amendments, and after consideration produce some concrete Amendment between now and the Report stage, I now beg leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
LORD ROCHDALE LORD ROCHDALE moved, in subsection (4), at the end to insert "relating to the subject matter of the scheme."
The noble Lord said: This really deals with another point than that concerned in the general discussion which we have just had. I understand that the noble Viscount is going to accept this Amendment, so I will not take up the time of the Committee by speaking upon it. I beg to move.
Amendment moved—
Page 91, line 9, at end insert ("relating to the subject matter of the scheme").—(Lord Rochdale.)
On Question, Amendment agreed to.
Clause 77, as amended, agreed to.
5.28 p.m.
Clause 78 [Alteration of charges scheme]:
VISCOUNT ADDISON: The next Amendments are drafting Amendments. I beg to move.
Amendment moved—
Page 92, line 9, leave out ("as is mentioned") and insert ("or other persons as are specified").—(Viscount Addison.)
On Question, Amendment agreed to.
VISCOUNT ADDISON: I beg to move the next Amendment.
Amendment moved—
Page 92, line 13, leave out ("as is mentioned") and insert ("or other persons as are specified.")—(Viscount Addison.)
On Question, Amendment agreed to.
VISCOUNT ADDISON: I beg to move the next Amendment.
Amendment moved—
Page 92, line 18, after ("body") insert ("or other person.")—(Viscount Addison.)
On Question, Amendment agreed to.
Clause 78, as amended, agreed to.
Clause 79:
Review of charges schemes.
(3) Representations may be lodged with the tribunal under this section by the following bodies, that is to say—

(a) any body representative of any class of persons making use of the services or facilities to which the scheme relates; or

LORD ROCHDALE LORD ROCHDALE moved, in subsection (3) (a), after "persons" to insert "not being themselves providers of transport for hire or reward". The noble Lord said: The two Amendments that stand in the names of my noble Friend, Viscount Falmouth, and myself, are, I think, outside the general discussion which we have just had. That discussion as I understood it, dealt only with representations of providers of transport. These two deal with users of transport. I think that perhaps I can best explain my Amendment, and save time, by giving a simple instance. As the clause now stands, a user who carries his goods, shall we say, between point A and point B by rail can make representation when questions of confirmation of schemes that affect his trade come up, when they relate also to that particular form of transport—namely, rail transport. But if schemes come up for confirmation, whether they relate to road or to canal transport, between the same two places and which may indirectly affect the same trader, he has no right of representation. The first Amendment is really consequential on the second amendment, which was covered by the large series of Amendments which we have just been discussing.
Amendment moved—
Page 92, line 44, after ("persons") insert ("not being themselves providers of transport for hire or reward").—(Lord Rochdale.)
VISCOUNT ADDISON: I think that the point in the first Amendment is covered by the arrangement already come to. With regard to the second Amendment, to insert the words "or affected by" after the words "making use of," in line 45, we are disposed to accept that in principle, but I do not like the words "affected by." They are rather too wide in scope. Would the noble Lord be willing to withdraw his Amendment and allow us to consider alternative words in consultation with him?
LORD ROCHDALE: I would like to explain that the first Amendment was inserted for the very reason he himself objected to the second one—because it was too wide. I thank the noble Viscount and beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 79 agreed to.
Clause 80:
Locus standi of local authorities as regards charges schemes.
80. Any reference in this Part of this Act to any body representative of any class of persons using services or facilities shall, in relation to passenger transport services provided by the Commission, include a reference to any local authority within whose area any persons using those services are resident.
LORD ADDINGTON LORD ADDINGTON moved to leave out "in relation to passenger transport services provided by the Commission." The noble Lord said: My Amendment seeks to leave out words that limit the right of local authorities to make representation in regard to passenger services only. As the clause stands, local authorities have no right to make representations about the charges in so far as they relate to goods transport, which is left entirely to associations representing traders. Local authorities have the right, under the present law, to make representations regarding both passenger and goods services under Section 78 of the Railways Act, 1921, and in view of the discussions we recently had it seemed to be agreed that all rights of representation should be preserved under this Bill. I contend that these local authorities are in a better position than any other body to represent the consumers, because the consumers, whether passenger or trader, are ratepayers of one or other local authority. It is to the local authority the ordinary man and woman in the street
34
naturally go to represent their interests. This Amendment is designed to retain for local authorities the right to be heard on all charges, and I hope the Government will accept it.
Amendment moved—
Page 93, line 24, leave out from ("shall") to ("include") in line 25. —(Lord Addington.)
VISCOUNT ADDISON: I am sorry we cannot accept the Amendment as moved. It would mean in every case including representatives of local authorities. There must be many cases in which local authorities would not be concerned at all, and I should point out to the noble Lord that the local authorities, so far as they ate users of any form of transport, are already fully provided for in the clause we have just passed, which provides for a body representative of users. There is also a special statutory provision that they are required to be consulted, in regard to passenger conveyance. These words go too far and would involve the local authorities in everything, which is not desired by anybody—not even by the local authorities.
LORD ADDINGTON: The point is that the ordinary man in the street who has a case about excessive charges has nobody but the local authority to represent him, and it is as the representative of ordinary persons that the local authorities ought to be able to make representation. They have this right at present under the Railway Rates Tribunal. You are taking away their present rights in regard to goods charges. But I will not press my point, although it is one to which the Minister might give more consideration before the next stage. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 80 agreed to.
5.38 p.m.
VISCOUNT SWINTON VISCOUNT SWINTON moved, after Clause 80, to insert the following new clause:
".Notwithstanding anything to the contrary contained in this Act the fares to be charged by:

(a) the Commission in respect of passenger road transport services provided by them otherwise than under Part II of this Act, and

(b) any person other than the Commission in respect of passenger road transport services provided by him under a scheme under Section sixty-two of this Act,

35
shall be approved by the appropriate licensing authority for public service vehicles, and sections seventy-two to seventy-six of the Road Traffic Act, 1930, shall apply accordingly:
Provided that the licensing authority shall so far as may be give effect to any relevant charges scheme made under Part V of this Act and relating to such fares, and in respect of operators of passenger road transport services other than the Commission or such person as aforesaid shall have regard to such charges scheme in exercising its powers under paragraph (b) of subsection (4) of Section seventy-two of the Road Traffic Act, 1930; and the Licensing Authority shall likewise give effect to the provisions of any scheme made under Sections 62 and 63 of this Act in so far as such provisions are relevant in exercising its powers under the Road Traffic Act, 1930."
The noble Viscount said: I beg to move this new clause in the form in which it appears in the Supplementary List. I sent it down very early in the morning, but the clerks were even earlier than I was and the Marshalled List was out. That was a very creditable performance. Your Lordships will remember that the House has already decided that the local licensing authorities, which have the jurisdiction they have hitherto possessed as regional licensing authorities, both in regard to passenger road transport and goods road transport, shall have that jurisdiction over both Commission and independent undertakings. I explained to the House that the rates and fares may be dealt with under a rates scheme submitted by the Commission to the Transport Tribunal and approved by that Tribunal, which will act under the clauses we have just been discussing. When asking the House to accept the proposal, I said that while the licensing authorities should maintain and secure jurisdiction over both Commission and independent operators, I thought it would be right and proper that they should be bound to give effect to any charges scheme which was in operation and approved by the Transport Tribunal.
We also discussed the effect upon the proposals which the Committee passed with regard to passenger road transport schemes. These are schemes of a different kind from those under the clause we have passed. I suggested then that such a scheme having been approved by Parliament should be binding upon the local licensing authorities in so far as it affects them. It would be likely to affect them only in general directives, because I think
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everybody agrees that it would be quite impossible for a scheme to embrace every bus service that was to run on every route, and every variant of it. But in so far as the scheme does affect the area, then the local licensing authorities ought to be subject to that scheme. Therefore, your Lordships will see that the proposed new clause, as it now stands, reads:
"Notwithstanding anything to the contrary … the fares to be charged by (a) the Commission … and (b) any person other than the Commission … shall be approved by the appropriate licensing authority for public service vehicles."
That is entirely consequential upon what your Lordships have already passed. Then there comes the dual proviso:
"Provided that the licensing authority shall so far as may be give effect to any relevant charges scheme made under Part V of this Act and relating to such fares"—
those are the clauses we have just been discussing—
"and in respect of operators of passenger road transport services other than the Commission or such person as aforesaid shall have regard to such charges scheme."
Then, two lines further on it says:
"and the Licensing Authority shall likewise give effect to the provisions of any scheme made under sections 62 and 63 of this Act in so far as such provisions are relevant in exercising its powers under the Road Traffic Act 1930."
This is consequential in its first part, and I think it carries out the two undertakings I ventured to offer to the House. I beg to move.
Amendment moved—
After Clause 80, insert the said new clause. —(Viscount Swinton.)
LORD GIFFORD: In supporting this Amendment, which appears jointly in the name of the noble Viscount, Lord Swinton, and myself, I should like to say that we have endeavoured, in its wording, to meet what has been said by the noble Viscount, the Leader of the House, earlier in this debate. I think it is true to say that it in no way restricts the general direction of the Commission with regard to fares or charges schemes made by the Transport Tribunal set up by the Commission. For instance, if the Commission decide to give a general direction that all fares should be raised 10 per cent., then such a direction can be given effect to under this clause. Perhaps I may comment on five words which may not be quite clear to the noble Viscount opposite. They are

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"so far as may be" at the beginning of the last paragraph on the first sheet of the Amendment. I think those words are commonly used in a Bill of this kind to indicate that you must have an exact penny or halfpenny. If there is a direction that the fares can be raised 10 per cent., the answer may come out to 2⅔d., or something of that sort, and in this case it would be to the nearest halfpenny. Those words are put in to cover that point.
I hope that the noble Viscount will accept this clause, because it does not in any way hamstring the Commission but, under the general umbrella of the Commission and the Transport Tribunal, it does allow fares to be settled locally by the Traffic Commissioners. As has been said before, no large independent road transport undertaking would attempt to settle fares in London or centrally—it must be done locally. The Traffic Commission control the existing operators as regards the fares, and I think they should control the Commission in that respect as well. Of course, the public have effective redress, even in the smallest towns, because the twelve area Traffic Commissioners, in a way, go on circuit, so that everybody has a fair chance of stating their case. Finally, I would like to make this cardinal point. Whereas rail fares are uniform, passenger road transport fares really must be settled locally. In same parts it is as low as a half-penny a mile, and in other parts it is very much higher. I think this clause really meets the general scheme, and also enables local fares to be settled locally, as should be done.
VISCOUNT ADDISON: I regret that I have not seen the noble Viscount's printed slip until just now.
VISCOUNT SWINTON: It is exactly the same except for the last four lines. The only new part is the part which begins, "and the licensing authority shall likewise give effect."
VISCOUNT ADDISON: Your Lordships are aware—and we made it abundantly clear when an Amendment was carried against us the other day—that we cannot accept the position that the scheme, made by the Commission and ultimately embodied in an order approved by Parliament, shall be subject to alteration by the licensing authorities. I do not know whether that is fully covered by the
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words which the noble Viscount has added.
VISCOUNT SWINTON: Yes.
VISCOUNT ADDISON: I hope it is, but if it is not, then clearly, so far as we are concerned, it would be quite unacceptable. The Tribunal is charged to prepare schemes covering the whole area. It is really quite unthinkable that you might have a scheme altering one route, and not altering another one. It would cease to be an economical self-supporting scheme. If that kind of thing were done, it seems to cause a completely impossible situation. It may be that the noble Viscount's words rule that out. I have seen them only in the last five minutes.
VISCOUNT SWINTON: They have been circulated.
VISCOUNT ADDISON: I have them on the Order Paper, of course, and I have studied them very carefully. So far as we understand them, it would leave the way open for divergence by licensing authorities which would upset the scheme of the Commission altogether. In any case, we cannot accept the position that the Endings of the Commission, embodied in orders approved by Parliament shall be subjected to local licensing authorities at all. I am afraid that we may perhaps differ fundamentally. All I can say is that, on the general principle, so far as I understand it, and if the schemes are accepted, I cannot quite see what the noble Viscount is getting at or what there is left to deal with. I cannot understand what there is left about which the noble Viscount is concerned. Further, I would suggest that as your Lordships carried the other Amendment contrary to our wishes, if this is introduced in this way we shall simply say "Not content" and not divide. It must be subject to review. It is no good repeating our discussion.
VISCOUNT SWINTON: The noble Viscount has made it necessary for me to say a word or two, because it would be most unfortunate if we were not all quite clear, first of all, upon what we have already decided, and secondly, upon what I am asking the Committee to decide on this. The draft has been carefully prepared. I put the further Amendment in last Friday, and it has been in the possession of your Lordships since Saturday morning, so that there is no

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reason why it should not have been studied. What your Lordships decided —and it was a very important issue—was that the Commission and the other permitted undertakers should both be subject to the same law. The contention of the Government was that the Commission should be above and outside the law, and that the permitted undertakers should be subject to the law. That was not acceptable to your Lordships. The decision of the Committee was that, in so far as the licensing authority were to have jurisdiction at all, there should be equal law for all, that they should exercise an equal jurisdiction over the Commission—the nationalized undertaking —and over the permitted undertakers; and, that in so far as there was freedom, there should be equal freedom for the nationalized Government Commission and for the permitted undertakers. That was the simple issue on which a Division was challenged, and the Committee divided—that there should be the same law for all. I cannot myself understand how so simple and elementary a principle of British justice and British practice could ever be challenged.
We then came to the consideration of two things. There are two ways in which an overriding decision can be taken which would fetter the jurisdiction of the licensing authority. The first is in the matter of charges under a charges scheme, with which we have recently dealt in the last three or four clauses. When a charges scheme has been presented by the Commission to the Transport Tribunal and, in whatever form the Transport Tribunal approve, has been promulgated by the Transport Tribunal, that is binding and it is going to be binding upon the Commission and upon the other permitted undertakers. The first proviso to this new clause says that the licensing authority, whether they are dealing with the Commission or with the other permitted undertakers, shall not in any way go counter to any provision of a charges scheme which affects it. That is the first point. The second point concerns an approved transport scheme, which is quite a different thing. The second part of the proviso says that the licensing authority shall be equally bound by an approved scheme. Again there was the simple contention that there should be the same law
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for both, and the answer of your Lordships to that was "Yes."
The noble Viscount, the Leader of the House—I must correct him on this—said to-day: "I cannot conceive what jurisdiction the licensing authority could have." I can conceive every jurisdiction that the licensing authority should have, and must have. To start with, it is quite inconceivable that the scheme is going to lay down every bus and every time it shall run, and all the things which the licensing authority deals with. It is absolutely bound, under any scheme which can work, to leave a great deal to be settled by the licensing authority. There was the further point which the Committee decided last time. If we had not made the Amendment we did, it would have been possible for the Commission to put on any number of lorries or buses it liked, and the permitted undertaker would only be allowed to put on such as the licensing authority allowed him to put on. The Committee considered that that would be grossly unjust, and decided that both should have a fair field and no favour should be shown to the Commission. That is fully implemented and carried out in this new clause, as I say, subject to the double proviso that the regional licensing authority must conform to the charges scheme approved by the Transport Tribunal, and must conform to any regional road transport scheme which has been duly approved by the Minister, which has been laid before both Houses of Parliament and has not been objected to by either House, and which, consequently, has become effective.
VISCOUNT ADDISON: I do not wish to prolong this discussion, but I want to make the point quite clear that, in our view, a scheme embodied in an Order approved by Parliament has the force of law. We cannot agree to any Amendment in the Bill which would have the effect of allowing that subsequently to be altered or reviewed by the local licensing authority which has received the authority of Parliament. We contend that it should not be subject to review by this minor authority, important as it is. I can only repeat that we shall simply say "Not-Content," and we are not committed to it in any way whatever if we are advised that it transgresses the principles which I did my best to uphold the other day.
On Question, Amendment agreed to.
5.56 p.m.
Clause 81:
Power to exempt Commission from certain enactments.
81. The Minister may by regulations provide that, as from such dates as may be specified in the regulations, any statutory provisions relating to charges, or to the avoidance of undue preference or to similar matters, and any other statutory provisions which in the opinion of the Minister are, having regard to the provisions of this Act or to the coming into force of a charges scheme, unnecessary in whole or in part in relation to the Commission or the services or facilities provided by them, shall, either generally or to such extent as may be specified in the regulations, cease to apply in relation to the Commission or to the services or facilities provided by the Commission:
Provided that nothing in this section shall affect the application to the Commission of so much of section two of the Railway and Canal Traffic Act, 1854, as relates to the giving of reasonable facilities.
VISCOUNT ADDISON: If I may intervene at this stage, I think I shall be saving the time of your Lordships. I will begin by saying that we propose to accept the Amendment on page 7 in the names of the noble Viscounts, Lord Simon and Lord Swinton, to leave out Clause 81. Therefore, I am quite sure your Lordships will not wish to discuss the Amendments to that clause. There are, however, a number of matters which I understand need to be tidied up. On the whole, instead of the Minister making regulations, as the clause provides, we agree that it would be better that it should be dealt with by a codifying Act in due course, in the light of experience. For that reason, we are agreeable to leaving out Clause 81.
VISCOUNT SIMON: I am very glad that the noble Viscount the Leader of the House has been able to make that announcement, and that he is able to accept the Amendment down in the names of the noble Viscount, Lord Swinton, and myself, to omit the clause altogether. The only regret that I have is that it removes from the Bill what would have been one of its major curiosities. For me, there could not be a dearer example of Hitlerism in practice than the provisions of the clause which the noble Viscount now—I think very wisely—agrees to omit. As it stands at present, the clause contains some astounding provisions, and makes one almost think that the Government or the draftsman has got tired of fitting the new proposal to the existing law, and has
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taken the simpler course and provided that the Minister might make regulations which would have the result in regard to existing statutory provisions on a number of matters, or any other statutory provisions, that they should not apply to the Commission. That is the essence of Hitlerism: "You have got a law, but I am the Minister, and, without telling you what I am going to do, I am going to tell you that the law will not apply to me." I am very glad that the clause is to be withdrawn, and I beg to move the Amendment.
Amendment moved—
Leave out Clause 81.—(Viscount Simon.)
On Question, Amendment agreed to.
Clause 82 [Transitional provisions as to charges]:
6.0 p.m.
VISCOUNT SWINTON VISCOUNT SWINTON moved, at the end of the clause to insert:
"(2) Before making any regulations under this section the Minister shall submit a draft to the Transport Tribunal and Sections seventy-seven and seventy-eight of this Act shall apply in relation to such draft as if in those sections there were substituted for the Commission the Minister and as if for the draft of a charges scheme there were substituted the draft regulations."
The noble Viscount said: This is another clause of great importance. Your Lordships have passed the clause which deals with the making of a charges scheme, and the Bill hedges that round with very great precautions. As your Lordships will have seen, the Commission are to have two years, or such longer period—and it may be much longer—as the Minister provides, in which to present a charges scheme to the Tribunal. Then, when the charges scheme is presented to the Tribunal, it has to be published, and those who feel they are adversely affected by it will have the opportunity to object. The Leader of the House has, very rightly, if I may say so, just announced his decision to extend considerably the area of those who are to be entitled to make objections, provided they are solid and substantial people with a right and proper standing.
These precautions in the framing of a charges scheme are most right and proper, because a charges scheme does not merely affect the transport undertakers of the country; it affects every user of transport in the country. When you come

43
to the heavy industries, I do not know how they can plan their reconstruction and how they are to conduct their operations unless they know what the scale and system of transport charges are to be. But we must accept the fact that this is a difficult matter; and it is very important that the Commission should be right in their original proposals.
Parliament has always insisted that in these great charges schemes there shall be an independent tribunal—it has been the Railway Rates Tribunal up to the present time—and that the decisions of the schemes shall rest with this judicial authority, after hearing the claimants or other proper people. There is going to be an interim period after the Bill is passed and before the Commission can present their full, considered scheme. What is to happen in the meantime? If your Lordships will look at Clause 82 you will see that the most strange thing is going to happen. Apparently the Minister is going to have the power to alter any or all of the rates in any way he pleases, certainly as regards the railways; I am not quite sure that it goes beyond the railways. I do not think it touches road rates. Even so, it is a pretty alarming power. The clause says:
"The Minister may at any time, if he thinks it expedient so to do with a view to ensuring a sufficient revenue to the Commission, to any of the bodies specified in the Third Schedule to this Act, to any railway company to which a schedule of charges is applied under the Railways Act, 1921, or to any light railway company to which subsection (2) of Section seventy-two of that Act applies, by regulations authorize the Commission, the body or the company to make, in respect of any services or facilities provided by them the charges for which are regulated by any statutory provision, charges additional to those in operation under that provision:
Provided that this Section shall not apply—

(a) to any services or facilities in respect to which a charges scheme is in force; or

(b) in the case of a body specified in the Third Schedule to this Act who are a local authority to any services or facilities provided by that authority otherwise than in connexion with the undertaking of that authority which is to vest in the Commission."

That one frankly rather beats me. I am not quite sure what is this limitation imposed on the Minister, but I do not think it is a very big one. But, subject
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to that very tiny limitation about the local authority, am I not right in the way I read this: that the Minister can increase any charge on any railway or any canal by any amount he pleases; he can triple the rates for carrying coal or steel—these charges which to-day a railway company, whether the increase is a permanent or an interim one, has to publish, have to go to the Railway Rates Tribunal? It cannot be charged until then. Under the Government's own plan, when the Commission get to work the rates structure has got to be published, every objector is heard, and it only comes into force when the judicial tribunal has approved it, with or without modifications.
Yet for the next three or it may be four years the Minister is to have an absolute power to enforce on the railways and on the canals any rates he pleases. So extraordinary is this proposal that I felt I must have read the clause wrongly and that it could not mean that. But I have read it again and have taken advice, and I am told that that is what it does mean. I do not know whether this is one of the clauses which came under the guillotine in another place and was never discussed. I am inclined to think it is. Certainly it should receive very careful discussion here. It is inconceivable that Parliament will wish to give to the Minister this power. A wholly different set of rules and regulations is to apply to the rates structure.
Observe what would happen if the Minister is to have this absolute power. He can put up these railway rates 25, 50, 100 or 200 per cent. By the time the poor Commission present their rates structure to the Tribunal the ground is all cut from under their feet. Surely the common sense of this is that what is right for the Commission in propounding a permanent rates structure is right for the Minister in propounding an interim increase. What has been right for the railway companies in the past should surely be right for those who are going to carry on the monopoly of transport in the future, in the interests of all users of transport in this country. I beg the Government to assent to the proposition that the Minister shall consider his own Commission and proceed in this way: that if he wants to increase railway rates he should publish them, and the Tribunal should hear objections and then finally

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the right rates should be propounded. I beg to move.
Amendment move—
Page 94, line 20, at end, insert the said new subsection.—(Viscount Swinton.)
THE EARL OF DUDLEY: I should like strongly to support this Amendment. It is considered vitally important by all the traders of this country, and particularly, as the noble Viscount has said, by the heavy industries. I am not going to travel over the ground which he has covered so well, but I should like to point out one matter that may have escaped your Lordships' attention. This clause is headed: "Transitional provisions as to charges," which may make one think that the transitional period is only a short one. Yet it may be several years before the charges scheme is prepared by the Commission, because, if your Lordships win look at Clause 75, lines 15 to 18, you will see that the charges scheme shall be prepared "within two years from the passing of this Act or such longer period as the Minister may allow …" This transitional period therefore may go on for a very long time, and it really is quite iniquitous that the Minister should now proceed on a war-time footing when there is no longer any emergency, that he should have overriding powers for several years to raise railway rates as he thinks fit without a public inquiry of any sort, and without traders being able to give their views. I beg to support the Amendment which I hope your Lordships will press strongly.
LORD HAWKE: Speaking as one who has some connexion with railways outside this country, these powers about which we are talking now simply make my mouth water. They are the answer to every rail operator's prayer: the power to increase charges without any inquiry of any sort or kind to cover an unlimited period by a perfectly legal subterfuge. These powers are, I think, an inducement to postpone the preparation of a charges scheme, and as such no Minister should be given that temptation. I submit that it would be only right and proper and kind of this House to remove such a temptation from any Minister. If he were to succumb—and it might be very easy for him to succumb—he would have the opportunity of taking the easy path of rate increases instead of the much more
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difficult one of any necessary economy-pruning. I beg to support the Amendment.
EARL HOWE: With regard to the remark which fell from the noble Viscount the Leader of the Opposition, this is one of the clauses which were never discussed in that other place owing to the misuse of Parliamentary procedure by His Majesty's Government.
LORD WALKDEN: I agree it was not discussed in another place for the simple reason that they spent all their time on the earlier Parts of the Bill. If they had kept on discussing it, they would have gone on talking for about two and a half years. I can quite understand a certain difficulty which has arisen in the noble Viscount, Lord Swinton's, mind, respecting the qualifying provisos (a) and (b), about municipal corporations. There is a reference actually to the City of Nottingham, as owners of a canal, which ensures that any increases to charges on the canal shall not be so general that they can spread it over all their municipal services. This clause will prevent them from doing it.
On the general merits of the Amendment I have to say that we can lot possibly accept it in our present circumstances, because the Minister has a tremendous responsibility now to keep the thing balanced, and to carry on during the interim period. It is true, as the noble Earl, Lord Dudley, has said, that there may be a couple of years before the Commission and the Rates Tribunal get the new scheme settled, but somebody has got to look after things in the interval. I certainly do not believe it will be anything like three years; there would be a great outcry if it were so lengthy. I agree that there is a possibility of it running two years, and during that period the Minister and the Government and Parliament, have got to see that these things are so carried on that there will not be ghastly losses, losses which would have to be borne by the taxpayer.
It is true that attention has been drawn to the fact that this Clause 82 simply makes transitional provisions. That is all it makes, only transitional provisions. When the scheme is firmly running on its own foundation, this will not arise at all. All rates questions will be dealt with by the Commission and the Tribunal. The Minister is only seeking to continue the

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powers which he already possesses, and which he has exercised to a very considerable extent, in the face of a serious financial situation. Traffic went up beyond all records during the war, and the net profit was so great, that, by the law of increasing returns, there was a great surplus; but since the war has been over, it is down. At this moment it is sliding right down. Whereas there was £30,000,000 or £40,000,000 of net profit, the estimates now are that it will slide down to between £9,000,000 and £11,000,000 at the end of this year, and it may be less. The Government is under an agreement with the Railway companies to make up the deficiency between the £9,000,000 and £11,000,000 and the £30,000,000 to £40,000,000 from the Exchequer. We cannot have that going on and on and down and down; that will not do at all.
Therefore, the Minister seeks to continue the powers which he has already exercised. He exercises them with careful consultation with responsible people—in one case it was the Dock Harbour Co-Ordinating Committee, consisting of people who use those services. Then he also has a Charges Consultative Committee in being and he consults them. He has exercised this power with very great moderation. Testimony was given as to that by the noble Viscount, Lord Portal, when speaking on the railway position generally. He said how small had been the increases in railway charges compared with the increases in the general level of prices. They had been very moderate indeed. But that is not enough. That was done last year, in 1946. Those moderate increases were put on, and now, in 1947, we are in a worse position. The cost of coal, the cost of steel, the cost of timber for sleepers and the costs of labour are all rising, and traffic is not rising. The law of decreasing returns is in operation, which is very serious. Therefore, the Minister must continue to have power to order increases of charges to help towards balancing the liability for works expenses, including interest on the capital that has been invested. That must be done.
VISCOUNT SWINTON: Does the Minister not, in fact, go to the Tribunal to-day for advice before he exercises those powers?
LORD WALKDEN: No, he did not last year. He does not have to go through that elaborate procedure. It is explained very carefully and thoroughly. The noble Earl, Lord Dudley, also amplified it; it is a very extensive procedure.
THE EARL OF DUDLEY: I would like to remind the noble Lord, that in his Second Reading speech, I think, or earlier in the Committee stage, he went to elaborate pains to complain that under the present system of railways, there was a lack of consultation; that was one of his chief complaints. Now he is advocating something which is a far greater lack of consultation than has ever been known here before.
LORD WALKDEN: I was speaking about the Consultative Committee, the like of which traffic consumers have never had before. But here and now this financial hiatus, this terrible loss of revenue, cannot go to consultative committees. There is no time to go before the Tribunal or Commission. It must be done, and he is now considering a further increase in charges because it is essential. The plan is that this set-up shall pay its way, that income shall meet expenses, and that it shall not be open to rob the Exchequer. Therefore, this clause is necessary.
It is only an interim provision. You need not be afraid of it. The Minister acts under the Government, and the Minister and the Government are under the High Court of Parliament. These matters can be discussed here. There is full public control over what he does. I am sure he has not been unreasonable in the past, and he has got to be reasonable now. He has got, for instance, the whole co-operative movement to deal with. They would raise a great outcry if he was unreasonable; naturally they would. It would be the same with my own various friends. But your Lordships know that the general level of prices and costings is increasing very seriously indeed. It is a matter of great urgency, and it is not suitable for reference to a Tribunal which will take anything up to two years. It must be done here and now in the interim period. Therefore, I beg your Lordships not to press the Amendment.
LORD HAWKE: Is it a really serious estimate that these Tribunals are going to take two years, because, if so, quite clearly

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their constitution will have to be amended in some ways, since this is not the only thing that will come before them. Unless we can get some constitution that will allow them to give decisions in some reasonable time, they are useless.
LORD WALKDEN: The Government are all for speeding up. I do not think that it will take two years, but I do know of my own knowledge that all the great railway revisions of long ago—and some of your Lordships will remember them probably—took a long time. You must have time to consider these things. But the Minister would only order percentage additions in certain charges, and he would not treble the rate on coal because the Transport Commission and the railways use more coal than anything else. He would not do that, therefore, and of course he would not put it on iron or steel or primary products. He has got to make his adjustment so that it can be borne as easily as may be, but he must make it, and this is the simplest and quickest way of doing it.
VISCOUNT PORTAL: The noble Lord mentioned the question of the Minister not raising the price against coal. What I wish to point out is that the drop in the railway receipts is nearly entirely due to the coal crisis that we had in this country. It is only fair to say on behalf of the railway companies that the drop in railway receipts would not have been anything like the amount it is now if we had not, had to take off so many trains.
LORD BEVERIDGE: I would like to ask whether it is not possible that the Minister will be forced to be unreasonable by unreasonable demands from employees of the railways. That is the danger and that is why it is desirable that he should have somebody to stiffen his back; because if the Traffic Commission and the employees are going to negotiate in definite ways about an increase, and then the Minister is going to have to come along to raise the rates, as he can do with his unlimited powers, I am not sure that this Amendment is a remedy. But I think it is clear that the Minister may be forced to be unreasonable.
VISCOUNT SIMON: I would like to say a word on this matter. Notwithstanding the explanation which has been given with his usual charm by the noble Lord
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opposite, I do not think anybody listening to this discussion and reading this clause can doubt that it does involve the prospect of a very serious state of things. It is to be observed that the power is put absolutely in the hands of the Minister. Nobody else as far as this clause is concerned has anything to say in it at all. If he thinks that an addition in rates is needed with a view to ensuring a sufficient revenue to the Commission during this transitional period, there is no limit whatever on the additions which he may make. I know something about the increases of railway charges on coal because years ago I was one of the counsel principally concerned in appearing for the railway companies when there was an increase of four per cent. put on the charge of coal coming from the north of England down to London on any of the railways. I agree that it was an extreme measure; but the point here is, not that the Commission may do it, or it may be done on their recommendations, but that does not say that anybody has to be consulted.
The noble Lord spoke about the Minister's admirable practice when he made consultation with, I think, two different bodies. There is nothing in the clause about this—nothing more nor less than saying that the Minister is an individual who is going to have unlimited powers to increase the rates as long as the transitional provisions go on. Am I wrong in saying that there is no actual provision in this Bill as to when the transitional provisions are to end? There is nothing to say that they must end in such-and-such a time. I quite understand the noble Lord's hope, and I am sure he is quite genuine in that hope, that it will not be more than a few years. Am I wrong about that?
VISCOUNT ADDISON: There is no question of time, but if there is a scheme they will not apply.
VISCOUNT SIMON: I took it to be in cases where there was a scheme which had a limited application. I do not understand why, when a scheme is in force, the period when it is in force should be described as a transitional period. I thought when it was in force the thing was done. I thought that had been inserted in case there had been a scheme about something, but not about

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everything. My point is this. This is what Parliament is doing. Members of another place never had a single moment in which to consider it. This is the only part of Parliament which can consider it. Let us just see what it is. It is a provision which does not say that the Minister should consult anybody, that he has to do it simply and entirely as an authority put upon him. No doubt he will be in consultation with his officials, as has just been pointed out by my noble friend Lord Beveridge. Let us turn back for a moment to page 6 of this Bill. There you see, at the beginning of line 16, that the whole conception is that it shall be the levying of
"such fares, rates, tolls, dues, and other charges as to secure that the revenue of the Commission"—
Your Lordships will notice the same word "revenue"—
"is not less than sufficient for making provision for the meeting of charges properly chargeable to revenue, taking one year with another."
Suppose that the Minister is put under great pressure to increase railway workers' wages. There is a simple way of doing it. All he has to do is to say: "The Government think that that would be a suitable thing to do. Of course, it is true that more revenue has to be produced to meet the extra expenditure; but I, the Minister, have unlimited power to increase the charges on the railways as much as I like, and Parliament—or at least such part of it as has been articulate on the subject—has passed this clause with that result."
I will next read to the Committee what is set out at the beginning of Clause 82:
"The Minister may at any time, if he thinks it expedient so to do with a view to ensuring a sufficient revenue to the Commission, to any of the bodies specified…"
and there follow a number of other bodies—
"by regulations authorise the Commission, the body or the company to make, in respect of any services or facilities provided by them the charges for which are regulated by any statutory provision, charges additional to those in operation under that provision:"
The plain English of that is that the Minister, on his own judgment, in a period now coming, to which there is no statutory end, may increase railway charges as and when he likes and as much as he likes.
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I notice that in Clause 83 a somewhat similar provision is made, not about railway charges—which are defined in a Schedule—but about exceptional charges which in many cases are much the more important of the two for the trader. Clause 83 (2) reads:
"The Commission may at any time increase any exceptional rate which under the provisions of Part III of the Railways Act, 1921, is in operation on the date of transfer in respect of any traffic up to sixty per cent. of the standard rate for the time being in operation under the said Act …"
There is not a limit there. With great respect to the noble Lord, I would call the attention of the Committee to the extreme character of this provision, which really means that when this Bill is passed we are, for what is no doubt a transitional period but none the less is an indefinite time, to give to a Minister, whoever he may be, without ever putting upon him any duty to consult anybody on earth, the right to say: "Strike that charge out, and make it so much more."
The Commission are to exist before January 1 next year. They are to be chosen and appointed. And some of these Executives are to be appointed. The Commission are to include someone chosen because he has some special qualification of financial knowledge or something of that kind. But when it comes to this, you simply say that the Minister, without any sort of responsibility or consultation with anyone at all, is to have the unlimited power of doing this, and doing it until the moment comes when he himself decides that the transitionary provisions may be ended. I cannot think, if this matter were considered impartially, that it would be regarded as one which would pass through another place without a word being said, and that we should now be expected to swallow it without making a protest in the name of the ordinary trader. This is putting infinitely too much power in the hands of a single person—no doubt a very honourable person but a politician with his own views. I suggest that it is not right that the traders of this country should, for an unlimited and undefined period of years, have this hanging over them, seeing that we were given to understand that this Bill was to produce changes of great value for the trade of the country.
The Committee will observe that the Minister has no power to reduce charges. Nobody contemplates that when the Bill

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is passed, the occasion will be one that will reduce charges. It is not even thought to be worth while providing for that. However, could anybody who has a fair view of what is going on suppose that a result of nationalization would be a diminution of charges? The only thing that needs to be provided for, apparently is that the Minister should be enabled to increase charges. I ask noble Lords to reflect whether the wording of that provision in this form is one that really can be regarded as acceptable and right.
THE EARL OF DUDLEY: I should like to say a few words in reply to the noble Lord, Lord Walkden. In regard to the Minister's present powers it is true that under the Supplies and Services (Transitional Powers) Act, 1945, the Minister has powers at the present time—a noble Lord has mentioned this—and has used them, if my memory serves me aright, on two occasions. On those occasions he submitted to a public inquiry a proposal for increased charges; and such action is what we are asking for now. Everyone had a chance of stating his views at that inquiry. That is all we ask for now. On one occasion—or perhaps two occasions—the Minister did not do that, and that is what we object to. I would like to point out that the Supplies and Services (Transitional Powers) Act was an emergency Act, passed at a time of national emergency; there is no reason to have it in force any longer. All we are saying is that during this future transitional period the Minister should act in the way in which he acted on two occasions during the emergency, when it was proposed to raise the charges. On that ground I would like to make one final appeal to the Government.
THE MARQUESS OF SALISBURY: We have had an extremely valuable and interesting discussion, and I feel that it is perhaps some justification of the existence of the Second Chamber that this point, which was not discussed at all in another place, owing to pressure of business, has had it first ventilation here. Whatever conclusion we come to, I think from the point of view of the country as a whole this discussion has been useful. The situation disclosed by the discussion is undoubtedly anomalous, and I think that probably it is perhaps a little worrying to noble Lords opposite, as well as to noble Lords on this side of the House. For
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what is the situation that clearly exists under the Bill? First of all, the Bill sets up a statutory body, the Transport Tribunal, to deal with rates and charges, and then there is this new provision which enables the Minister, purely for the purpose of raising revenue, to fix, on his own responsibility, new rates and charges additional to those which are regulated by the statutory provisions of the Bill. It appears that there is an overlapping—possibly a rather dangerous overlapping—and apparently, he can do this without any consultation with the Transport Tribunal. I admit that it is only for the interim period, but, as everybody knows, this is an experiment, and nobody knows how long the interim period may last.
This certainly seems to be a considerable lacuna in the Bill. You appoint a Tribunal with certain duties, and then give the Minister power not only to override the Tribunal but to do so without any consultation at all. I cannot believe that the Government really meant the machinery to work in that way. After all, it is said to be for purposes of raising revenue. The noble Lord, Lord Walkden, said that the Government might need revenue at very short notice. They may indeed; they may need revenue at short notice for various purposes—because the ordinary transport revenue was going down or because there might be an extra call on the revenue. Or again, as the noble Lord, Lord Beveridge, said, there might be an immense demand for, say, an increase in wages which would call for increased revenue suddenly to be produced. There might be very heavy political pressure on any Government—I do not mean especially a Labour Government but any Government in power at the time—and there is apparently to be no check by some outside body, representing the interests of the population, the traders and travellers and everyone who uses the railways, on this very dangerous political pressure.
I do not wish to put it too strongly but that might easily give rise to a dangerous situation. The Commission must use this machinery of the Tribunal and the Minister need not use it. That is the position disclosed. I understood from the noble Lord, Lord Walkden, that it would be impossible for the Minister to use it because it would involve such lengthy procedure—perhaps taking weeks and months. That is a depressing thought,

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because this machinery is to be used by the Commission and if it is to take such a long time for the Tribunal to express their views on proposals put forward by the Minister it would take just as long with proposals put forward by the Commission. It sounds like an extremely unwieldy body, if that is to be the length of their deliberations. We do not want to set up machinery too difficult and unwieldy, and I have a modified suggestion to make which I would like to put forward for the consideration of your Lordships. It is that at any rate there should be some statutory duty on the Minister to ask the views of the Tribunal. That is not going so far as to have a statutory duty to abide by the conclusions of the Tribunal, but I think he should obtain the expert informed views of the people devoted to this question. After all, we have to carry on afterwards. I suggest that the Government should not turn down quite flat, on Committee stage, a proposal of that kind; they should consider the matter further, and perhaps by the Report stage put in something that would strengthen the Bill, strengthen the position of the Minister, and lead to less opposition on this question.
VISCOUNT ADDISON: I welcome the suggestion of the noble Marquess; we would be perfectly willing to consider his proposal or a suitable practical alternative. A fact which it may be of interest to mention is that in July, 1946, the Minister was faced with the prospect of a heavy deficit on the Railway Control Account which would have had to be met by the Exchequer, and accordingly he made an order increasing railway charges. At that time he asked the Railway Rates Tribunal, sitting as the Charges Consultative Committee, to advise him on charges. That kind of emergency power is absolutely necessary in the interval. If the House will accept it, we will consult on the suggestion made by the noble Viscount and I hope he will not press the matter further.
VISCOUNT SWINTON: In view of that undertaking I will withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 82 agreed to.
6.42 p.m.
Clause 83:
Transitional provisions as to exceptional rates and fares of the Commission.
83.—(1) The provisions of this section shall have effect as respects charges made otherwise than under a charges scheme.
(2) The Commission may at any time increase any exceptional rate which under the provisions of Part III of the Railways Act, 1921, is in operation on the date of transfer in respect of any traffic up to sixty per cent. of the standard rate for the time being in operation under the said Act, and section thirty-eight of the said Act (which prescribes the procedure to be followed as to alterations of exceptional rates) shall not have effect in relation to such an increase.
(3) So much of sections thirty-seven, thirty-eight and forty-one of the said Act as requires the granting or reduction of exceptional rates or the charging of exceptional fares to be reported to the Minister or enables the Minister to refer any such matter to the Transport Tribunal shall not apply to rates and fares of the Commission …
(5) In its application to the Commission, section thirty-nine of the Road and Rail Traffic Act, 1933 (which relates to agreed charges and exceptional rates competing with coastal shipping) shall have effect as if—

(a) in subsection (2) for the words "If at any time a representation is made to the Minister" there were substituted the words "A representation may at any time be made to the tribunal", and the words from "the Minister shall consult" to the end of the subsection were omitted;

LORD ROCHDALE LORD ROCHDALE moved, in subsection (2), to leave out "The Commission may at any time increase," and insert: "(2) Where in the opinion of the Commission." The noble Lord said: The Amendments on page 94, at line 23, and line 26, in the name of the Earl of Selkirk and myself, and at line 30 in the name of Viscount Falmouth and myself, deal with the matter under discussion here, and with the approval of the Committee I would like to take them together. The clause deals with exceptional rates and gives the Commission authority to raise exceptional rates that are below standard, up to sixty per cent. of the standard rate, without any traders having the right to have their case heard if they felt that raising the rates would be to their disadvantage. I believe the reason for the sixty per cent. arose as the result of the representation made some time ago, I think in August, 1946, by shipping interests because they felt that coastwise shipping was being adversely affected by exceptional rates. No doubt they had a good case, but I

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cannot see why these rates should be raised without any right of representation, however good the case against might be. There are many exceptional rates that have nothing to do with coastwise shipping. The purpose of the Amendment is to make it possible for representation to be made before any of these exceptional rates below sixty per cent. are raised. I beg to move.
Amendment moved—
Page 94, line 23, leave out from the beginning to the second ("any") and insert "(2) Where in the opinion of the Commission."—(Lord Rochdale.)
LORD MORRISON: It might save time if I say immediately that we propose to accept this Amendment.
LORD ROCHDALE: I am most grateful. Can the noble Lord make it quite clear whether the application of the ruling that the rate should not be raised goes back to the time when it was raised or to the time when the ruling was given?
LORD MORRISON: I am afraid I am not in a position to answer that question, but I will get an answer and let the noble Lord know.
On Question, Amendment agreed to.
LORD ROCHDALE: I beg to move the second Amendment to which I have just referred.
Amendment moved—
Page 94, line 26, leave out ("up to") and insert: ("is unduly low by reason of the competition of road haulage undertakers, canal carriers or persons engaged in coastal shipping, the Commission may at any time increase that rate up to not more than").—(Lord Rochdale.)
LORD MORRISON: This Amendment is also accepted.
On Question, Amendment agreed to.
VISCOUNT SWINTON VISCOUNT SWINTON moved, in subsection (2), to leave out "not." The noble Viscount said: I had hoped this was to be accepted too, and that we would do the hat trick. Under the Emergency Powers Act, the Minister has powers, which Clause 82 makes sure he goes on exercising, to raise all the revenue he wants. This is giving new powers, not to the Minister but to the Commission, who are to have the power to put up the exceptional rates. To-day, if the railways want to after the exceptional rates they are subject to the provisions of the Act of 1921. When the Minister has all these
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powers under the Emergency Powers Act, and the railways are subject to the Act of 1921 in altering the exceptional rate, why is it necessary to say that the Commission shall not be bound by what is already binding on the railways? If we can have some explanation, we may know better what to do.
Amendment moved—
Page 94, line 29, leave out ("not").—(Viscount Swinton.)
VISCOUNT ADDISON: I understand the position is that under the Railway Rates Tribunal the railways have power to increase rates in certain cases. This is to give the Commission power to have a wider option, but we have limited that option by accepting the Amendments of the noble Lords, Lord Rochdale, the Earl of Selkirk and Viscount Falmouth. It is necessary that the Commission should have the power during the transitional period, and not be limited so strictly as the railway companies are under the existing Act.
VISCOUNT SIMON: The exceptional rate is, as a rule, lower.
VISCOUNT ADDISON: That may easily be so.
VISCOUNT SIMON: The standard rate is the ceiling above which you cannot go. It often happens that the railway company have an exceptional rate which is lower. I understand this to be for the transitional period, and to give the Commission power, once the transitional period is over, to deal with an exceptional rate without having to go through the full procedure which is provided in the earlier part of the Bill.
VISCOUNT ADDISON: I am obliged to the noble and learned Viscount.
VISCOUNT SWINTON: I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
VISCOUNT FALMOUTH: I think my next Amendment has been agreed to in a previous discussion.
Amendment moved—
Page 94, line 30, at end insert: ("Provided that, if any trader is aggrieved by the raising of any exceptional rate under this subsection, he may appeal to the Transport Tribunal, and if the Tribunal are satisfied that the Commission were not justified in raising the rate under this subsection, they may order the lower rate to be restored and the Commission shall give effect to that order.")—(Viscount Falmouth.)
On Question, Amendment agreed to.
VISCOUNT SWINTON VISCOUNT SWINTON had given notice that he would move to leave out from the first "shall" in subsection (3) to the end of subsection (4), and insert "have effect in relation to rates and fares of the Commission." The noble Viscount said: I should like a little guidance on this. Having withdrawn the previous Amendment standing in my name, I think I ought not to proceed with this now.
VISCOUNT ADDISON: That is right.
VISCOUNT SWINTON: I hope I shall be generously treated on the next Amendment.
Clause 83, as amended, agreed to.
Clause 84 agreed to.
Clause 85 [Overriding provisions as to exercise by Commission and Transport Tribunal of their powers as to charges]:
VISCOUNT SIMON: It seems to me that it would hardly be consistent with what we arranged a little earlier to-day if I now moved and pressed my Amendment to leave out certain words. The idea was to cut out from Clause 85 of the Bill:
"or which in their opinion will prevent the Commission from giving effect to any direction of the Minister under any provisions of this Act"—
and so on. It seems to me that that refers back to Clause 82, and as there is a prospect of finding some adjustment in that clause, I think it would be better for me not to move this Amendment now. I understand that my noble friend Lord Rochdale agrees with me on this.
Clause 85 agreed to.
Clause 86 agreed to.
Clause 87 [Provisions as to railway freight rebates]:
THE MARQUESS OF READING THE MARQUESS OF READING moved, at the end of the clause to insert:
"and all sums payable by the Commission for interest or repayment of principal or into any sinking fund for repayment of principal in respect of the Rebates Stock shall be paid out of the revenue of the Commission and shall have the same priority as payment of rates over other payments thereout to the extent of any relief from rates provided for by any Act."
The noble Marquess said: On behalf of my noble friend Lord Rennell I beg to move this Amendment. I think it is consequential upon an Amendment to Clause 38, and will be accepted by the Government.
Amendment moved—
Page 97, line 14, at end, insert the said words.—(The Marquess of Reading.)
LORD MORRISON: The noble Marquess is quite correct.
On Question, Amendment agreed to.
Clause 87, as amended, agreed to.
[The sitting was suspended at five minutes before seven o'clock and resumed at half past eight.]
Clause 88:
Borrowing powers of the Commission.
88.—(1) The Commission may, with the consent of the Minister, or in accordance with the terms of any general authority given by him, borrow temporarily, by way of overdraft or otherwise, such sums as the Commission may require for meeting their obligations or discharging their functions under this Act:
LORD BALFOUR OF BURLEIGH LORD BALFOUR OF BURLEIGH moved in subsection (1), to leave out "with the consent of the Minister, or in accordance with the terms of any general authority given by him." The noble Lord said: The point in respect of which this Amendment has been put on the Paper is a very simple one, and will not take a moment to explain to your Lordships. Subsection (1) of the clause gives the Commission permission for temporary borrowing, and I seek to strike out the words "with the consent of the Minister, or in accordance with the terms of any general authority given by him." This applies only to temporary borrowing. There is a limit of £25,000,000, and it is quite separate from the big borrowing powers which come later on in the clause, and which go up to £250,000,000. It is really ridiculous that the Commission should have to go to the Minister to borrow the smallest sum, and if the Minister is going to give a general overriding authority—as he probably will—there does not seem to be any need to have that limitation in the clause. The Commission are in a very big way of business, and quite obviously must have temporary borrowing powers. Clearly, they ought to be able to borrow of their own volition, and not be compelled to go to the Minister. I beg to move.
Amendment moved—
Page 97, line 17, leave out ("may") to ("borrow") in line 19.—(Lord Balfour of Burleigh.)
LORD NATHAN: As the noble Lord who moved this Amendment has said, this clause provides for temporary borrowing powers up to the figure of £25,000,000. It must be borne in mind that the Treasury is guaranteeing the stock to be issued by the Commission, and is therefore in effect guaranteeing the capital of the Commission. In those circumstances, the not unusual course is provided for in this clause of restricting the Commission from exercising borrowing powers without the assent of the guarantor. But the noble Lord may take it that the power to give a general authority will be exercised as occasion may arise, and that there is no intention on the part of the Minister to use his powers under this prohibition for exercising any close or day-to-day control over the operations of the Commission. Whilst a general power may be given, the Minister will require to have the power in a particular instance. It may be for the authorizing of a particular transaction so that he may exercise a general superintendence upon that aspect of the financial affairs, bearing in mind that the Treasury is the guarantor. In those circumstances, I am unable to accept the Amendment.
LORD BALFOUR OF BURLEIGH: I think the Minister's reply is a very weak one, because it is not the Minister who is guaranteeing the stock. It says expressly in subsection (2) that the Commission may "with the consent of the Minister and the approval of the Treasury, borrow money." That refers to the big borrowing of £250,000,000. It is quite off the point, if I may say so respectfully, for the Minister to say that there is any need for approval here in those terms, because it is only the consent of the Minister, and not the consent of the Treasury. However, the point is not really a point of great substance. I think the Bill is badly drafted in this respect, as in other respects, but in the circumstances I will not press the Amendment.
Amendment, by leave, withdrawn.
Clause 88 agreed to.
Clause 89:
British transport stock.
(3) Subject to the provisions of this section and of the said Fifth Schedule, British transport stock shall be issued, transferred, dealt
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with and redeemed upon such terms and in accordance with such provisions as may be prescribed by regulations made by the Minister, with the approval of the Treasury, and any such regulations may, in relation to any British transport stock, apply with or without modifications arty provision of the Local Loans Act, 1875, or of any enactments relating to stock issued by a local authority.
THE EARL OF DUDLEY THE EARL OF DUDLEY moved, in subsection (3), at the end, to insert:
"provided that nothing in any such regulations shall impose any restrictions as to the disposal of such stock."
The noble Earl said: On behalf of my noble friend, I beg leave to move this Amendment. It is really only a drafting Amendment, and I think there is nothing between the Government and those of us who have submitted it. Clause 89 gives the Commission various powers to grade stock, and then there are various provisos in regard to the terms under which the stock shall be issued, transferred, dealt with, redeemed and so on. But the provisos say nothing in regard to restrictions as to the disposal of such stock. I am quite certain that the Government do not intend that there should be any restrictions as to the disposal of the stock, but we feel that it should be said that there are no such restrictions. The provisos should be strengthened by the addition of this Amendment, which I hope the Government will see fit to accept. I beg to move.
Amendment moved—
Page 99, line 31, at end insert the said words.—(The Earl of Dudley.)
LORD NATHAN: The Minister and other Government spokesmen have repeatedly said in another place, and it has been stated in the course of these debates, and I now reaffirm on behalf of the Government, that there is no intention of putting restrictions on the disposal of the stock. It is true that restrictions were imposed in connexion with coal, but so important and unusual did the Government conceive that provision to be that they were scrupulous to insert the appropriate provision in the text of the legislation itself. It is quite unthinkable that the Government should impose by administrative action restrictions on the disposal of the stock in this case, in the face of the fact that in the case of coal the restriction was given legislative force, and that I have reaffirmed on behalf of the Government that there is no such intention. The regulations which apply to the

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transfer of stock are purely procedural and of a quite normal character, familiar to the public at large and to the Stock Exchange—such, for instance, as the requirement of producing a stock certificate with the transfer, and matters of that kind. No regulations affecting the rights of the stockholders as stockholders would be made. I reaffirm once more the assurance that the apprehensions of the noble Earl are wholly unfounded.
VISCOUNT SWINTON: The noble Lord has made a number of affirmations, from which I do not dissent. He has said that it is not the intention of the Minister to impose restrictions of this kind and that all he wants to do is some procedural business. The point of an Act of Parliament is that it should provide what the Government intend. May I ask the noble and learned Viscount the Lord Chancellor what the position is? The matter is really important. Apart from what people intend to do when they get a regulation, as the Lord Chancellor has said over and over again, an Act of Parliament should do that which it is intended it should do. The noble Lord, Lord Nathan, has said it is intended that in no case should the Minister be able by any regulation to restrict the transfer of stock. May I ask the Lord Chancellor or someone else who will give an authoritative legal answer for the Government, does this Bill as now drafted, or does it not, give the Minister power to make a regulation to do that which he says he has no intention or desire to do? If the noble and learned Viscount the Lord Chancellor tells me that under the Bill he has no such power, I accept that from him at once, as the highest judicial authority in the land. If he says the Minister does have the power and the Minister has no intention of using it, I say that that power ought not to be in the Bill.
VISCOUNT MAUGHAM: May I add one word on this question, which is really one of some importance? The material words are these: "British transport stock shall be issued, transferred, dealt with and redeemed upon such terms … as may be prescribed by regulations". I shall listen of course with deference to what the noble and learned Viscount, the Lord Chancellor, may think, but I confess that my opinion is that the words "transferred upon such terms as may be prescribed"
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means that the Minister may, for instance, say that stock is not to be transferred before a particular date. I think he could say one of the terms or conditions of the transfer of this stock is that the stock shall not be transferred—I am assuming now a very reasonable provision—say, for one year after the vesting date. But, in my opinion, it might also, as a matter of law, justify a very different and much more serious regulation, which the Government have told us again and again they do not intend to exercise, in the event of there being no proviso put here. For my part I would suggest that some proviso is necessary.
I am not quite sure that the present promise by the Government extends so far that there is nothing in it of the nature of prohibition upon transfer of stock for a limited time. Therefore not only do I think the proviso is all that could be desired but I also think, as my noble friend Viscount Swinton has just stated, that in dealing with vast sums of money like this, it is right that the public should know, irrespective of any pledge by a Government (which may, after all, be only of a transient kind), that in these regulations no prohibition will be made which would interfere with the right to dispose of these stocks in such way as the owner for the time being may think fit.
EARL HOWE: The noble Lord, Lord Latham, has reaffirmed that it is not the intention of this Minister to do anything of the sort. If it is not the intention of the Minister to do anything of the sort, why not accept the Amendment? What is there against it? Suppose, for the sake of argument, that the country goes mad again in 1950 and again elects a Socialist administration with all that that involves, and that that administration goes back on what the noble Lord, Lord Nathan, has said. Nothing that he has said can bind a succeeding administration. Surely it is much better to have it in an Act of Parliament as suggested in the Amendment? What is there actually against it?
THE LORD CHANCELLOR: Since I have been appealed to, may I say this: I do not pretend to have a very expert knowledge of this part of the Bill, but I will look at the question which I have been asked, and advise the noble Earl as to what the appropriate answer should be. May I add this? I rather object to

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unnecessary provisos being put in a Bill because you very often find they have exactly the opposite effect to that intended. If you put in a proviso saying "You shall not do this"—which nobody considers doing for the moment—that has, on the true construction, the effect that you may do all sorts of other things. It is not desirable to put in unnecessary provisos, but if you will give me time, I will look into it and see if this particular proviso is or is not necessary.
VISCOUNT SWINTON: I am much obliged to the noble and learned Viscount for that answer. On the other hand, he will equally agree that here is not a minor but an important point of substance: if the Bill would empower the Minister to do what his Front Bench says the Minister ought in no circumstances to do, we ought to make it perfectly clear in the Bill that the Minister cannot do that.
VISCOUNT ELIBANK: May I ask the noble and learned Viscount, when he is considering this question so far as this Bill is concerned, to remember that the same point will come up very shortly in connexion with the Electricity Bill? It is important that there should be stability so far as this sort of stock is concerned—that is to say, stock which is negotiable at any lime that it finds its own level. It would be very wrong indeed if any step were taken which did not enable those who receive this stock to be able, if they wished to do so, to negotiate it at once. That will apply to the Electricity Bill as well as to this Bill before your Lordships' House at the present moment.
THE EARL OF DUDLEY: This Amendment was clearly tabled only with a view to strengthening the Bill, and in the light of the noble and learned Viscount's assurance that the matter will be looked into between now and the Report stage—for which I am grateful to him—I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 89 agreed to.
LORD BALFOUR OF BURLEIGH LORD BALFOUR OF BURLEIGH moved, after Clause 89, to insert the following new clause:
Issue of British Transport Terminable Annuities.
"—(1) Each of the persons who, immediately before the date of transfer, were the holders of any securities mentioned in Parts I
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and II of the Fourth Schedule to this Act shall be entitled to receive, in addition to the British Transport Stock issuable to him under the provisions of Section 89 and of the Fifth Schedule to this Act, a British Transport Terminable Annuity.
(2) The amount of the said Annuity payable to each such person shall be equivalent to one per centum of the amount of his claim for compensation under the provisions of this Act.
(3) Each such Annuity shall be payable for a period of ten years ending on the 31st day of December, 1957, and shall be paid to the holder thereof by equal half-yearly payments on the 30th day of June and the 31st day of December in every year.
(4) Subject to the provisions of this section, British Transport Terminable Annuities shall be issued, transferred and dealt with upon such terms and in accordance with such provisions as may be prescribed by regulations made by the Minister with the approval of the Treasury, and any such regulations may, in relation to any British Transport Terminable Annuity, apply with or without modification any provision of the Local Loans Act, 1875, or of any enactments relating to stock issued by a local authority.
(5) Any British Transport Terminable Annuity in which no person is interested except the Commission shall be cancelled."
The noble Lord said: It is not my intention on this occasion to address to the noble Viscount, the Leader of the House, any of those rather awkward questions which on previous stages of the Bill it has been my duty to put to him and his duty so diplomatically and so courteously to refrain from answering. The merits or the demerits of the Government's proposals, and particularly the compensation proposals, have been discussed very fully on a previous clause, and I therefore do not intend to go all over the ground again in relation to merits on this occasion, except in so far as I have to touch upon them to establish the case which I hope to make, that there is being inflicted in this measure a degree both of hardship and of injustice. My object in putting this Amendment on the paper is to enable me to make to the noble Viscount what is quite frankly an appeal ad misericordiam that he will see whether something can be done to mitigate the great hardship which is going to be imposed by this Bill on a large number of people, a large section of the population of this country, belonging to every different rank of society. We all know that the noble Viscount is an honourable, just and humane man, and this matter which I am about to put before your Lordships is one in which honour, justice, and humanity are all involved.
Let me explain in one word what would be the effect of the Amendment which stands in my name, if it were put in the Bill. The effect would be to entitle every existing holder of railway stocks whose present security is convertible into British Transport Stock to receive, in addition to the compensation provided by the Bill, a ten year annuity calculated on one per cent. of the nominal amount of the present compensation. I wish to say from the very outset that I have no intention of pressing this matter or asking your Lordships to divide upon it. But the class of people for whom I am venturing to appeal to the noble Viscount are particularly those who are dependent on income from trust funds, and particularly in cases where the trustees are bound by the strict trustee clauses. It is in that particular class of case that we have perhaps the strongest evidence of what I venture o say is the injustice which is to be inflicted under this Bill. These beneficiaries of trusts are people whose income is derived very largely from these prior lien irredeemable stocks. I think there is an incontrovertible element of injustice in a forced conversion from an irredeemable stock carrying anything from 3 per cent. to 5 per cent. to a British Government stock carrying 2½per cent. I do not think it can be claimed that the fact that there is a Government guarantee on the 2½ per cent. stock is in any way compensation for the loss of the irredeemable character of the stocks which are being given up.
There is another very definite evidence of injustice, and that is in the anomalies which exist in the prices of these different stocks. The most notable case is the debenture stock of the Great Western Railway. There are both 2½ per cent. and 5 per cent. debenture stocks, and circumstances with which the Committee are familiar have had the effect of bringing about a quite inequitable difference in the prices of these two stocks which does not at all correspond with the respective rates of interest. Another point to which I would like to refer is that prospective holders of this Government stock do not know yet what it is they are going to get. The Chancellor of the Exchequer has given certain information, but it is not yet complete, for the reason that the precise terms, I understand, are not to be settled except in relation to the level of
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prices at the time the conversion takes place. But the Chancellor of the Exchequer has said: "I accept the argument that it should not be irredeemable stock but that it should be dated," and in reply to a question as to whether the date would be within the century the Chancellor of the Exchequer said: "I would expect it to be within the century." One hopes, in fact one anticipates, that that means that it will in fact be what the City knows as a "dated stock." Your Lordships know, of course, that the Treasury 2½ per cent. stock, 1975 or later, has a date, but it is a date which is at the option of the Government, and it is therefore not a dated stock. That stock was issued a few months ago at par, and it now stands, I think, at somewhere in the neighbourhood of 94. In fact, I have heard it suggested that a Government security of that kind would be more accurately described as a "Government insecurity." It is, of course, very much to be hoped that there will be a date at not too distant a term for the stock which is going to be issued.
Now the people that I have in mind, as I have already said, constitute a large section of the community. First and foremost, I would like to refer to the effect which this forced conversion will have upon the financial position of the Churches and the religious communities generally. The religious communities, and the Churches, represented their case by way of a deputation, which was led by the most reverend Primate, the Archbishop of Canterbury, to the Chancellor of the Exchequer. That deputation represented the Church of England, the Church of Scotland, the Church in Wales, the Roman Catholic Church, the Free Churches and also the Jewish community. The deputation waited upon the Chancellor of the Exchequer as long ago, I think, as January 8 of this year. That was certainly before the Bill had gone into Committee in another place. The position was explained clearly to the Chancellor of the Exchequer. Everybody knows what it is.
Everybody is aware that the income of the Churches is declining and while salaries and wages generally have gone up, in most cases ministers' stipends have not gone up at all. It is no exaggeration to say that many ministers of different religious communities have a stipend which compares unfavourably with the

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wages of unskilled or semi-skilled workers. The position of pensioners too is very serious. In particular, I have been informed that the Aged and Infirm Ministers' Fund of the Church of Scotland is going to suffer. The already very inadequate allowances paid under that fund are in danger of diminishing, and this is also the case with the Widows' and Orphans' Fund. This is happening at the very moment when the Churches are to have put upon them enormous new responsibilities. The satellite towns springing up need a great number of Churches and church halls.
It is doubly unfortunate because this severe cut—I do not give figures because no doubt they vary in every case—is very severe indeed. The deputation had a very sympathetic hearing from the Chancellor, who promised consideration for the special proposal which they made and, in fact, in the course of his reply, which was given on January 8, the Chancellor said that the matter was not urgent, in the sense that an immediate decision was not required, since the Transport Bill would take some time to pass through Standing Committee and the date on which railway stocks were vested in the Government was not until January 1, 1948. The Chancellor had to leave the meeting, but before the deputation left an assurance was given by the Financial Secretary to the Treasury that a decision on the proposal of the Churches would be given by the Chancellor before the compensation clauses of the Bill came before the Standing Committee of another place. There were delays and it is a fact that the reply of the Chancellor to the Churches was not received until May 8, by which time the Bill had not only passed through Standing Committee but had had its Third Reading.
It is only fair to the Churches that the case should be stated fully to your Lordships because there was no opportunity to have the case stated in another place. I desire to make it perfectly clear that I am not casting any aspersions whatsoever on the good faith of the Chancellor of the Exchequer. I will read a portion of the letter sent to the most reverend Primate:
"I have since received your letter of 29th April in which you ask whether my answer may be expected in May. Please do not think that your case has been overlooked in the interval. On the contrary, it has been most closely and sympathetically studied. I have
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myself given it the most anxious consideration. I could not give you an earlier answer, as it has raised issues that could not be lightly or hurriedly decided. But my decision has now been reached, and I am sorry to tell you that the Government cannot see its way to offer the Churches any exceptional financial relief.
"I have taken this decision with very great regret, for I fully appreciate the spiritual and social value of the work that is financed by the endowment income of the churches, and the difficulties that will arise where continuing commitments have been incurred….
"… I fully recognize the value of the services which the Churches are financing out of their endowment income, and the loss which the community would suffer if those services had to be curtailed."
And it is not only the Churches we have to remember. There are numerous other funds. I have a further copy of a letter sent to the Chancellor of the Exchequer by the secretary of the Indian Civil Service Family Pension Fund. That is another fund in which the pensioners, almost all belong to the fixed income class, which has already suffered so severely from rises in taxation and the decline in the purchasing power of money, and it is quite clear that this conversion must tend to reduce their pensions. The secretary does not state definitely that it will reduce the pensions, but I am informed that if this measure is followed by the Electricity Bill that result will be quite inevitable. The income of the widows and of dependent children will inevitably be reduced.
I would mention to your Lordships just one individual case. It is not a case selected specially by me, but one which came into my hands, purely by chance, only a day or two ago. It aptly illustrates the hardship which will be caused by this forced conversion. It is the case of a British officer, aged twenty-nine, who was killed in action in Holland in 1944. He left a young widow and two orphaned children, aged four and two. The widow was granted a gross pension of £140 as year—that is £140 a year, less tax. The children are granted a net sum of £18 a year until they are seventeen years of age. That is free of tax, but it ceases when they are seventeen. It is within my knowledge that the means of this widow, apart from that pension, are almost nonexistent. It so happens that there was settled on those children a trust fund of £5,000 in L.M.S. 4 per cent. guaranteed stock. The income from that is £200 a year, but under this Bill it will be cut

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to £125 a year That fall of £75 a year is going hit that widow and those two small children very severely. The young officer who was killed was articled to a well-known firm of City solicitors, and he had a very good career in prospect. The tragedy which that represents to that particular family can hardly be considered without a good deal of emotion.
The Chancellor of the Exchequer has suggested that people who suffer loss of income as a result of these compensation terms can restore their income by buying Government annuities. That course may be open to a few elderly people. It is certainly not open to Churches and charities; and it is not open, of course, to people who have dependants who for some reason will never be able to earn their own living. When we were discussing the Coal Act of 1938 the noble Viscount who now leads the House was sitting on the far Benches. He had no reason to be particularly sympathetic to the royalty owners, but I well remember his saying, on one occasion, with a burst of frankness: "It does seem to me that in some respects these people have had a raw deal." I was on the other side, and I always have thought it was extremely generous of the noble Viscount—it indicates his humane character, to which I have already referred—that he was prepared to be sorry for the royalty owners. If the noble Viscount was sorry for the royalty owners, as I know he was, I think we need have no doubt that he will view with even greater sympathy the case which I am now putting before him.
I would like, quite briefly, to indicate a rather interesting comparison between the position of the three sets of people—if I may put it that way—who are concerned with the railways. There are the users of the railways, whose charges have gone up only by a proportion, some 25 per cent., and others 33 per cent.; and there are the railway staffs, who, with the increased cost of living, have received an increased remuneration of 60 per cent.—of course, there is a claim now being considered, which is sub judice, and cannot, therefore, be discussed. But the stockholder, the third party in the matter of the railways, has had no relief whatever, either in respect of the increased cost of living, or of increased taxation. I know the Government justify their price by saying that they took the only available
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rough measure of the railway undertakings; I know they claim that it does rough justice. All I can say is, that when justice gets as rough as that it ceases to be justice at all. I will just take, if I may, the words of the noble Viscount, Lord Swinton, who summed it up like this, and it could not be put better:
"If it is not a fraudulent offer, it is an offer which no business man would accept, and which no trustee would be justified in accepting in the discharge of his trust."
I would like to glance at this matter from just one more angle. I do not know if it has occurred to your Lordships, but there are four different classes of people whose property is being expropriated by this Bill. They are the private owners of railway waggons, the local authorities, the road haulage undertakings and the railway stockholders. Just consider for a moment what has happened to each of those sets of people. The owners of private railway waggons were dealt with before the Bill had even left another place. The terms were so unsatisfactory that the Government entered into conversations and substantially improved the terms in time to put the amended compensation into the Bill before ever it came to your Lordships' House. The local authorities have also had better terms conceded to them. Since the Bill has been in your Lordships' House the noble Viscount, or one of the other noble Lords on the Front Bench, has moved Amendments which I believe improve their compensation by £2,500,000. The prospects of the road haulage undertakings have been improved by Amendments moved by the Government since the Bill came into this House. There remain only the poor stockholders, for whom nobody on the Government side has so far had any compassion at all.
The Government may ask: "But where is the money to come from?" I remember that there was an expression used that if something were done it would have to come out of the Government's own pocket. The concessions which have already been made indicate that there must be some source from which extra money can come, and I suggest to your Lordships that in the case of the stockholders the source is even more obvious than any other case, Consider for a moment the £17,250,000 which the Government are saving by reason of the terms which they are giving. I will just read

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to your Lordships what the Chancellor of the Exchequer said about that. He said:
"The stockholders of the big four railways will have a total drop in income. The drop will be from £40,000,000 to £22,750,000 a year. That means that he"—
that is the Minister of Transport—
"will have to pay out to the holders of the Compensation Stock £17,250,000 a year less than is now being paid to railway stockholders, and that sum will be available for the improvement of our services to give us a better and more efficient transport system."
It is true that that sum will not go direct to the Chancellor of the Exchequer; it will be divided between the users of transport and the railway staffs, in proportions which remain to be ascertained.
I have no doubt that the noble Lord, Lord Walkden, will see that his friends he looks after so well will receive their fair share of it. But where does it come from? That £17,250,000 comes out of the pockets of these same stockholders. It is in fact a reverse subsidy. It is a subsidy to the Government out of the pockets of the stockholders. Even if that does not go to the Chancellor of the Exchequer, let him cast his mind back to the controlled period, because there remains a surplus in the control account of something like £80,000,000—in spite of one had year which they have had, owing to the failure to raise charges. I do not want to go back on the merits of the case, but many of the stockholders think they have a good right to part, if not all, of that money. I do not want to labour the matter, but the noble Lord, Lord Nathan, did use one sentence which I venture to repeat to your Lordships.
In reply to the noble Viscount, Lord Swinton, the noble Lord, Lord Nathan said:
"The noble Viscount may safely leave it to the Chancellor of the Exchequer and the Government to have a sense of propriety and justice in carrying out the provisions set out in the Statute."
I earnestly hope that that is so; and the request I address to the noble Viscount, the Leader of the House, is that he will repeat to us that pledge, and will give us an assurance that between now and Report stage he will have some consultation with the Chancellor of the Exchequer—I appreciate that this is a matter for Government decision—and see whether they cannot hold out some hope that something may be
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done for the benefit of these unfortunate stockholders.
It is said that Providence tempers the wind to the shorn lamb. There are plenty of shorn lambs about en this occasion. It is open to the Chancellor of the Exchequer to play the role of Providence if he wants to. He can enter the stage; the wool from the shorn lambs is all there, baled and packed, much of it going into the warehouses of the Chancellor; and even this season's crop—I think "crop" is the right word—is producing £17,750,000. I think we have reason to hope that the Chancellor of the Exchequer might give the unhappy stockholders another thought. Chancellors of the Exchequer are notoriously hardhearted and of course the Chancellor may harden his heart. Pharaoh, I remember, hardened his heart on nine or ten occasions, and the result was the plagues of Egypt. If I remember aright, various unpleasant things happened to Pharaoh when he hardened his heart. The frogs, the flies, and the lice, were I think the least of the troubles which visited him. We have no Moses available on this occasion to play the rôle of calling down the plagues on Pharaoh. Fortified by the machine majority in another place, the Chancellor of the Exchequer is in a position to do exactly what he likes; he is master of the situation. In these circumstances, there remains only one plea we can make, and that I address to the noble Viscount. It is: "O, it is excellent to have a giant's strength; but it is tyrannous to use it like a giant." I beg to move.
Amendment moved—
After Clause 89 insert the said new clause.—(Lord Balfour of Burleigh.)
VISCOUNT SWINTON: Before the noble Lord replies I should like to add a few words from this side in support of the spirit and the substance of this Amendment. This is another clause and another subject which, for the first time, I understand, has its opportunity of discussion in your Lordships' House—and surely it is worth discussion. I hope the Government will consider it without prejudice. The Leader of the House is a humane man and a just man, and I hope we shall not have to say to him that in a cause which is even more deserving than that of the royalty owners, he is going to play the part of the Walrus or the Carpenter. The noble Lord who has moved this Amendment has made it very wide in character.

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He has asked, and I dare say he is right, for justice for all and 10 per cent. all round. I suppose he would say, in the language of the railway undertakings, that he did not feel he ought to give an undue preference to anybody.
I can see the Government's difficulty in increasing everything by 10 per cent., though frankly, if they had approached this business in the ordinary recognized way in which compensation has always been settled for one hundred years—namely, what is a fair price for a going concern?—I think they would have had to pay at least 10 per cent. and possibly a good deal more than 10 per cent. more for the whole of these undertakings. But I am going to put in to-night a special plea to the Government for people who, I am quite certain, have a special claim. The Government may say that in some cases the ordinary shareholder is getting enough, and, of course, like all skilful advocates, if a general case is put they naturally ride off on what is the most defensible, or at any rate, the least indefensible count in the charge. I am going to ask them to answer the specific case of people who had every reason to suppose that they had a fixed income as long as they lived, and afterwards. This is a very modest plea for a terminable annuity of one per cent. for ten years. Is that too much to ask for people who had every reason to believe that they had an interminable annuity for an indefinite period?
Take the case of the holder of a perpetual debenture, or a high ranking, well-secured, prior lien stock. There might be some rich, heavily taxed man, looking for a capital appreciation—that was not the kind of stock that he would go into. These people go for an equity in which they see a probable chance of appreciation. I would venture to bet, on pretty long odds, that if you took the lists of shareholders and stockholders of these irredeemable debentures and irredeemable well-secured preference shares, you would find very few big capitalists among them, and you would find no speculators at all. You would not find the people who go in for a capital rise. You would find two sorts of people: one class would be the people who had saved their money, who were drawing to the close of their lives, who wanted to put something aside for
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their children, and perhaps for the education of their children, on which they knew they could rely. The other class you would find would be the great charitable institutions of this country—the Churches, the schools and the colleges. I wager that perhaps 90 per cent. of the whole of that type of security is held by that type of person.
Let me give the noble Lord an example drawn from my own knowledge. I am the chairman of a diocesan board of finance. I have only recently taken that on, and so I can speak of how well it has been done without claiming any credit for myself. The finances of that diocese have been admirably managed for a long term of years. We have been careful to invest in irredeemable stock, if possible, but, at any rate, in very long-dated securities which were safe but which gave us a steady income. It is not one of the greatest dioceses in this land, but we are very large holders of exactly the kind of irredeemable stocks you are seeking to confiscate under this Bill. We had a plan to increase all the livings in our diocese up to a living wage. Well, it is not a rich diocese, and we have made a special effort. We raised, on a special appeal, something which today is very little short of £200,000, in order that we might be able to go ahead with the new work, that we might give a living wage to our priests, that we might be able to establish the new churches and the new livings in new towns as they developed. I asked for an estimate. So far as I can see the whole of the interest on that £200,000 or more will be required to make up the loss of income we shall suffer as a result of what is taken from us under this Bill. We have lost the income on that just at a time when we thought we were going to expand our work.
It is that kind of appeal that I venture to make to noble Lords. I hope we shall not get a dialectic answer or a final answer to-night, because, no doubt, whoever has to speak will speak on instruction; but I do hope this matter will be reconsidered, and not reconsidered simply by the Minister of Transport, but by the Government as a whole. You have always stood for the underdog; that is your plea. You have always stood for social advancement, and you would be the last to deny that these great Christian institutions of every denomination have

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played at least as great a part in the social advancement of the country as your Party, or my Party, or any Party in this State. I do ask you to reconsider this, for surely this schedule of expropriation—I would almost say, in the case of these prior lien stocks, "this schedule of confiscation," although I know you call it conversion—is not the kind of "conversion" which our common Christianity inculcates.
9.22p.m.
LORD BEVERIDGE: May I briefly support the appeal that has been so eloquently made by the noble Lord, Lord Balfour of Burleigh, and the noble Viscount who has just sat down? I am not going to trouble you with numbers of individual stories. Anybody who has any imagination at all, anybody who has any letters at all or any post at all, knows that when you are reducing the income of hundreds of thousands of people from £40,000,000 to £22,750,000, you must be creating appalling hardship in many individual cases. I can give such cases to the Minister or anyone who wants them from those I have in my letter bag. We know that above all it is hurting the trustees who are doing such good work, the old people who have saved a little money to live on, the people who have left a little money for their widows and children. It is in the undoubted power of the Government to inflict this hardship, and I know that we in this House, however much we may feel that this is a ghastly hardship, cannot in such a matter vote, and it would be no good for us to vote. This matter rests with another place; but, of course, just because you have the power to inflict this hardship that is no reason for doing so. Rather is it a reason for avoiding doing it, if you can possibly avoid it consistently with the discharge of your duty to the rest of the country.
In other words, surely you should not cut down compensation to this small sum unless it is the maximum that can fairly be justified. If there is a doubt, you should not give the benefit of it in favour of the rest of community against these individuals, but rather to these people—these stockholders. In fact you can justify this only if you say that the railways are in such a position now that they could not expect to earn more than £22,750,000 a year: that they are to that extent already a bankrupt concern. But
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suppose that were so, that they would not be able to go on doing as they have been doing, paying £40,000,000 a year, and that it were the case that these people had lost their income already. That would have been their misfortune. But you are forcing misfortune on them.
I have already suggested a number of reasons why the compensation proposed is not fair. It is not fair to take the basis of the Stock Exchange prices and use them in the way in which the Government propose to use them in calculating the compensation. Then British transport stock is not the fair equivalent of cash, Further, may I remind the Committee of a figure that was given to me when I was proposing to raise the compensation by 20 per cent? The noble Lord who replied said that that would cost us another £200,000,000. I think it is probable that in the properties we shall be taking over from the stockholders there is something like a sum of £200,000,000—partly money set aside, and partly a claim for special depreciation meant to restore the earning capacity of the railways. There is, I believe, something like £40,000,000 to £150,000,000 in a Reserve Fund, kept away from the stockholders and earmarked for building up the earning power of the railways. There is also a claim of £50,000,000 or £60,000,000 for the special damage done to the railways during the war. Can one imagine that these factors are taken into account and allowed for in the fixing of the prices as they stand on the Stock Exchange to-day?
I do not wish to speak for more than a few moments, but surely this is not a question of principle for the Government. To make a change in this matter would not wreck the Bill or affect the substance of the Bill at all. It would in fact do a great deal to commend the Bill to public opinion as going nearer to doing justice. Several of us here have made attempts in various ways to get something better for the railway stack-holders. I made one proposal, and I made another proposal; others have made different proposals. I do not think that any of us who want more done for the stockholders are particular as to the way in which it should be done, but I do hope that the Government as a whole will seriously try to find a way out of the cruelty which otherwise they will be inflicting.
9.30 p.m.
LORD NATHAN: The noble Lord, Lord Balfour of Burleigh, deployed his arguments with moderation and persuasiveness, matched by the impressiveness and earnestness of the speeches made by the noble Viscount, Lord Swinton, and Lord Beveridge. This is a subject, especially put before the House as it has been, which needs to be considered and dealt with by me, on behalf of the Government, with a like sense of seriousness. The proposal of the noble Lord, though framed in the form of an annuity, is intrinsically nearly akin to the proposal, discussed earlier in our debates, by the noble Lord, Lord Beveridge. It is, in fact, a proposal for an increase of the compensation by £100,000,000 payable in ten annual instalments of £10,000, 000 each. That is what the proposal is—for an addition to the capital of the compensation.
In answering the Amendment put before your Lordships by the noble Lord, Lord Beveridge, I attempted to indicate the reasons why on a number of grounds the Government were unable to accept that proposal. We now come to the suggestion contained in the Amendment before your Lordships. Let me say that I and all my colleagues are fully conscious of the fact that there are large numbers of persons, investors in railway stocks, or beneficiaries under trusts or charities, who feel that their income is being unfairly diminished by reason of this compensation proposal. Noble Lords opposite may rest assured that before these proposals were put into legislative form the Chancellor of the Exchequer and the other members of the Government were fully conscious of the fact that that argument might be adduced against them, and they would not, of course, gratuitously seek the unpopularity which it might be expected would arise from a proposal which meant that large numbers of people felt that their income was being unfairly reduced. The Government, however, felt that the proper course to take, irrespective of any unpopularity which might arise—
LORD WOOLTON: We raised the question of justice, not popularity.
LORD NATHAN: The proper course that seemed to them right was to do justice as between the public at large and
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the holders of these particular classes of securities. Let us see how the argument goes. The fact of the matter is that very large numbers of holders of these securities are charities. Churches are very largely interested, as the noble Lord, Lord Balfour of Burleigh, has indicated, and as he pointed out to your Lordships, the Chancellor of the Exchequer himself gave the most meticulous consideration to the points placed before him by the most reverend Primate, the Archbishop of Canterbury, and others representing the various denominations. It was only after lengthy consideration and much reflection that he came to the conclusion—indicated by the noble Lord, Lord Balfour of Burleigh—in the letter in which he replied to the most reverend Primate. The basis of that decision was that it was impossible to segregate one group of stockholders from another, and to treat one group differently from other groups.
VISCOUNT SWINTON: What does the noble Lord mean by that? It is very important that we should know what the explanation is. Does the noble Lord mean that you could not differentiate a stockholder who is an ecclesiastical beneficiary, who is a holder of a debenture, from another holder of the same class of debenture? Or does he mean that you could not differentiate between holders of irredeemable well secured stocks and holders of ordinary stock?
LORD NATHAN: What I intend to suggest is that it is not possible, in the view of the Government, to differentiate between one group of holders in securities of a certain class and other holders of securities in that class. When I say "in that class," I mean railway stocks taken as a whole. Much has been said by all noble Lords who have spoken, not only in this discussion but on an earlier occasion—but particularly this evening—on the hardship, as it is alleged, which is inflicted by these proposals upon those who are dependent, to a greater or lesser degree, upon income from railway stocks. It is important to face fairly, but also to face fully, what are the facts in this connexion. Prior to the war, I think the net maintainable income of the railways, in the years 1935 to 1937, was an average of £36,000,000.
LORD HAWKE: In the money of that era.
LORD NATHAN: £36,000,000. The guarantee given by His Majesty's Government under the control agreement at the outbreak of the war was £38,000,000; and the revenue of the railway companies during the period that has since elapsed has been £40,000,000, or thereabouts—of which £38,000,000 has been derivable from the Government, and the balance from ether sources of income in the hands of the railway companies. It is not unnatural that during the period that has elapsed throughout the war until now, all those who have been receiving that income, guaranteed as regards £38,000,000 by the Government, should have felt that that income represented a permanent income—or, if you like, a perpetual annuity. But any such idea—which I feel prevailed in many quarters—is certainly a wholly ill-founded illusion. Indeed, as events have shown, the position now is that the revenue of the railways is far less than £38,000,000; it is far less than £36,000,000, and it is far less than the £22,750,000 which has been mentioned.
VISCOUNT PORTAL: May I interrupt the noble Lord for a moment—
LORD NATHAN: I am aware that it has been suggested—I heard the noble Viscount say so in another connexion this afternoon—that that has been due to the coal crisis.
VISCOUNT PORTAL: Will the noble Lord excuse me? In regard to the reduction of revenue, in the ordinary course of events we should have been allowed, like other industries, to put our rates up. The Ministry of Transport put their rates up 25 per cent. and 33 per cent., and they are now waiting to put them up further. The stockholders would have received a bigger income or revenue than that which you say is continually descending. That is the point I wanted to make.
LORD NATHAN: I have not said that it was continually descending. What I said was that it was reduced from £38,000,000, below £38,000,000, below £36,000,000 and below £22,750,000. The position at the moment is that, but for the Government's guarantee, the revenue of the railways would be between £8,000,000 to £10,000,000—and nearer £8,000,000. If it were not for the guarantee it would be upon that sum alone that the stockholders in railways would have to look, in
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their various degrees, for their income from their holdings. The £22,750,000 is more than twice as much as the railways by themselves are able to produce for their stockholders of various classes to-day. It is very important—
THE EARL OF RADNOR: The noble Lord does realize—?
LORD NATHAN: It is important that those facts should be clearly realized. It is very important that those shareholders should no longer be allowed to remain under the illusion that the income they enjoyed during the war, which was guaranteed by the State, is an income upon which they are entitled to rely indefinitely. With regard to the Churches—whose situation in this respect I fully realize—and large numbers of charities, and also in regard to widows and orphans who have been mentioned, I believe it to be true to say that hid the Government not come forward with this scheme at this time, with these arrangements for compensations, they would have fared a peat deal worse in regard to income than they will fare under these arrangements. I say that deliberately; I say that on due reflection.
The noble Viscount, Lord Portal, who speaks with a vast experience in matters relating to railways, has said that the railway companies could increase their charges. That is, within limits, true, and what I have said is subject to these qualifications. The charges might be increased, and it would achieve some amelioration of the situation—if they could be increased to a point that would cover increased costs of every kind, if the increased charges did not meet with sales resistance on the part of those who wished to travel or send goods, and if the range and volume of traffic were not only maintained but vastly increased. Unless those conditions are fulfilled there is nothing to be hoped for from an increase in rates. The plain truth of the matter is that, as matters stand, and as it appears they will continue, it looks as if this income, reduced though it will be below what the guarantee of the Government has made possible in the past, will be a great deal more than the stockholders could expect to receive if they were left to look to the revenues of the railways alone.
The noble Lord, Lord Balfour of Burleigh. said he did not intend to press

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this Amendment to a Division. Had he not said so, I should have had to state that I could not accept it and must resist it; but I do not wish to discuss this matter from the standpoint of this Amendment. I desire to discuss it as a practical matter of business, so that the investors in the railways may know what I believe the fact to be: that as a result of this arrangement, doubtless inflicting hardship and reduction of income at the moment, far less hardship will be inflicted upon them than if there were no such scheme.
LORD BEVERIDGE: Does the noble Lord who has just spoken attach no importance at all to what was said by the Chancellor of the Exchequer, who estimated that after allowing for the £22,750,000 which is to be paid out there will then be a surplus of £17,000,000, and contemplated its being quite easy to keep up this maintainable revenue? And does that not mean that the Government realize that you can make maintainable revenue what you like, within limits, by raising charges? Secondly, does the noble Lord really think that any importance whatever attaches to what the railways may be earning at this particular moment, when all the items on the one side of the account, the expenses of wages and everything else, have been allowed to go up without any regulation?
LORD WOOLTON: I wonder if the noble Lord would mind telling us just how much the Government have paid as a result of their guarantee to the stockholders?
LORD NATHAN: As regards the questions put to me by Lord Beveridge, it is certainly the fact that when this Bill was introduced into Parliament a good many months ago the Chancellor of the Exchequer was of the opinion that he would have a sum of money over and above the £22,750,000, as he stated in another place when speaking on compensation; but that hope has been dissipated so far as this year is concerned because the curve goes relentlessly down.
LORD BEVERIDGE: The other question was whether you attach any real importance to what is happening now when you let all the items on one side of the account go up and prevented those on the other side going up.
LORD NATHAN: The curve goes down and the situation could only be retrieved if the charges could be increased to a point sufficient to cover all the increases in cost upon various items, and if there were no sales resistance to existing traffic, and if the existing traffic were vastly to increase. Otherwise increases of the charges would not effect the object which the noble Lord has in mind.
LORD WOOLTON: Is that the purpose of the clauses we have just been discussing?
LORD NATHAN: With regard to the question put to me by the noble Lord, Lord Woolton, I am speaking, as he will understand, across the Table, without the opportunity of reference to anything, but I am, I know, correct in saying that this year the amount payable under the guarantee will be between £30,000,000 and £32,000,000.
LORD WOOLTON: Will the noble Lord be good enough to answer my question? How much has the Government paid on that guarantee since it started—since the war began?
LORD NATHAN: My belief is that hitherto, with the inflation created by the Government traffic and the war situation, happily the Government has so far not been called upon to pay.
LORD WOOLTON: How much profit have they made out of this?
LORD NATHAN: But now the business created and furnished by the Government has come to an end, the Government has been called upon to pay heavily.
LORD WOOLTON: I do not want to be rude, but the noble Lord did make a speech. I know a little about railway finances and, as I listened to the noble Lord, it seemed to me that he was talking about something entirely different from anything I had ever heard as regards finances. I believe that unintentionally the noble Lord mislead the House.
THE MARQUESS OF SALISBURY: I did not intend to intervene at this stage and I only propose to say a very few words now because, after all, this is not one of those questions in which your Lordships can, with any usefulness, proceed to a Division under the Constitutional arrangements that at present exist. It is clear that any

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action we could take would be the least effective, and all we can do is to express our views, as it is our duty to do. I must confess that as I listened to the Government's reply—I hope they will forgive me—I thought it was one of oleaginous hypocrisy. The noble Lord who spoke just now began by saying, almost with tears in his eyes, that the Government have been conscious of the fact that the argument could be used against them that unhappy people were being cruelly used. I suppose he would say that that was a factor to be taken into account, and he went on to say that "justice to the community as a whole must be weighed against justice to any individuals." That is an argument which could be used to justify any injustice against an individual.
This is an argument which was used by Hitler justify the injustices against the Jews and Socialists in Germany—that it is an injustice, but is necessary in the interests of the community as a whole. This is an argument that has been all too familiar during the last twenty years, I am sorry to say. I am afraid, and it is the honest truth, that there was a character of this sort in Plato's Republic, who said that justice was the interest of the stronger. I am afraid that is the explanation. I am afraid that that is the explanation for these unhappy people for whom we are pleading—I know quite hopelessly, but we do our best. They are not strong; they are the weakest members of the community. They are the underdogs of to-day. It is not the great powerful communities who support the Government who are suffering under existing circumstances, it is the unorganized people—the clergy, the widows, the orphans and the people who have no organization; those are the people who will suffer under this proposal.
The Government claim, and claim—I do not want to do them any injustice—with a certain amount of justice, credit for the improvement in social services. They say that they are the people who stood entirely for the working sections of the community. But this provision will inflict an injury on countless numbers of utterly helpless and innocent people. We cannot do anything about it except to plead with the Government. I know that the Leader of the House is a humane man. He must know, in his heart of hearts, the suffering which will be inflicted by these
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compensation provisions. The noble Lord, Lord Nathan, said there was nothing to be hoped for, that it would not be any good increasing the rates, or improving the position, so that more compensation could be paid to these people; but we have had an Amendment moved to-night on which there was a lot of discussion. We put forward the Amendment so that we should have advice upon it. It was said that there would be a rise of rates immediately, without any consultation with anybody, merely for the purpose of getting revenue. If the Minister can do that, why should he not raise the rates to get revenue and do justice to these unhappy people who will suffer under this proposal?
The noble Lord, Lord Nathan, said in the last words that he spoke that the stockholders would have done worse without this scheme. That is a matter of opinion; no doubt the Government hold one opinion, and a great many people hold another; but the fact remains that almost to a man the stockholders would have preferred not to have this stockholders scheme and to remain in the position they were before.
LORD STRABOLGI: That is because of the propaganda they have been subjected to.
THE MARQUESS OF SALISBURY: I am sure the noble Lord cannot really believe that; these people have been subjected to a great deal of Government propaganda on the other side, but they have not been convinced by it. It is not for me to try and overstate the case, but we all know of cases where people will suffer. If the Government cannot do what is proposed in this Amendment, cannot they do something for them? That is all we ask of them. Cannot they talk over the matter further with their colleagues and try and get something done for these unhappy people? If they can do that, they will well deserve and will receive the thanks of their grateful countrymen. We will certainly not try to make any capital out of the matter, and we shall give any support we can. We do feel genuinely unhappy about this. We are not trying to make it difficult, and we do hope that even at this late hour in the Bill the Government will go once more to the Chancellor of the Exchequer

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and see if he can do something to help. That is all I want to say upon this. I beg the Government to consider it.
10.2 p.m.
LORD BALFOUR OF BURLEIGH: Before I withdraw this Amendment, may I say just one or two words. First, I wish to say that I must admit I was dismayed to hear the enthusiasm with which the noble Lord cast himself for the part of Pharaoh. As to the point that railway revenue is falling, it did occur to me to wonder, if it continued to fall to this alarming extent, what the Government were going to do when they had to pay the wages. I suppose that they will find it necessary to pay wages, and in order to do so I imagine that they will find means of putting charges up. The noble Lord said, in answer to my plea that the railway stockholder was hard hit, that the Government and the Chancellor of the Exchequer were conscious of the arguments that could be used about that before the Bill was introduced. Were they not equally conscious of the arguments that might be used on behalf of the owners of railway waggons, of the arguments that might be used on behalf of local authorities, of the arguments that might be used on behalf of the road hauliers? If they were conscious of all these arguments before the Bill was introduced, why was it necessary to mitigate the terms during the passage of the Bill through the House of Commons and your Lordships' House?
It seems that it must be possible for the Government to mitigate the terms to the stockholders if they really want to. The Chancellor of the Exchequer said to the most reverend Primate, the Archbishop of Canterbury, that he could not concede a special security. I am inclined to think that the Chancellor of the Exchequer was right; it would be very difficult to distinguish between one holder of a security and another. But that does not in the least alter the case, that they have it in their power, if they wish, to so alter this so as to temper the wind to the shorn lamb; and that is what we beg them to do their best to bring about. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clauses 90 to 92 agreed to.
Clause 93 [Sums which are to be chargeable to revenue]
LORD NATHAN: This is really an Amendment for the purpose of clarification. Under the clause as drawn, it was feared that it might read as requiring duplicate provision to be made out of revenue for the wasting of assets—once by means of a provision for renewal, and once by means of a charge for obsolescence. It is intended to make only a single provision, and that is what the Amendment is designed to achieve.
Amendment moved—
Page 101, line 9, leave out from the first ("for") to the second ("and") in line so and insert ("depreciation or renewal of assets and proper provision for redemption of capital").—[Lord Nathan.]
On Question, Amendment agreed to.
Clause 93, as amended, agreed to.
Clause 94:
Accounts.
94.—(1) The Commission

(a) shall cause proper accounts and other records in relation thereto to be kept; and

(b) shall prepare an annual statement of accounts in such form and containing such particulars, compiled in such manner, as the Minister may from time to time direct with the approval of the Treasury.

(2) The said annual statement shall be so framed as to provide, as far as may be, separate information as respects the principal activities of the Commission, and the Ministry and the Treasury shall exercise their powers under subsection (1) of this section accordingly.
(3) The accounts of the Commission shall be audited by an auditor or auditors to be appointed annually by the Minister and in accordance with a scheme of audit approved by him and, if the Minister so directs, the accounts of the Commission as respects any part of their undertaking specified in the direction shall be separately audited by an auditor or auditors so appointed as aforesaid.
LORD NATHAN: Before the noble Lord, Lord Balfour of Burleigh, moves his Amendment, may I suggest that it might perhaps be for the convenience of the Committee (I am, of course, in the hands of the Committee), of the noble Viscount opposite, and of Lord Balfour of Burleigh that the next two Amendments, in the names of Lord Balfour of Burleigh and of Viscount Swinton, should be taken together? They are not the same, but they touch on the same subject matter.
VISCOUNT SWINTON: I do not think it would be at all convenient. They relate to entirely different matters. The

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Amendment standing in the name of my noble friend, Lord Balfour of Burleigh, requests that certain operational statistics shall be given on the lines on which they are now regularly given by the railway companies. An entirely different subject is dealt with in the other Amendment standing in the name of Viscount Simon and myself—namely, the form of accounts to be rendered by these different kinds of undertakings. I do not see why we should concertina these Amendments. The noble Lord is trying to browbeat the House. We are getting accustomed to his spreading himself over it. He really must not do so. This is a subject which was not even discussed in another place, and now the noble Lord, not content with creating a monopoly of every transport undertaking in the country, is trying to amalgamate all the Amendments together.
VISCOUNT ADDISON: I am quite sure the noble Viscount will allow me to enter a modest caveat. My noble friend was not trying to browbeat anybody. These two Amendments deal with accounts, so he suggested that they be taken together. I am sure he would be the last to oppose the noble Viscount, and if he wishes them to be taken separately, let it be so.
LORD BALFOUR OF BURLEIGH LORD BALFOUR OF BURLEIGH moved, in subsection (1), at the end, to insert:
" and

(c) Shall prepare and publish such annual returns and statistics in respect of each of the principal activities of the Commission as shall be comparable with the returns and statistics required to be kept or made under the several Acts mentioned in Subsection (5) of this section by Railway and Canal Companies in such form as the Minister may from time to time direct."

The noble Lord said: My Amendment does not deal with accounts at all. It has to do with annual returns and statistics.
VISCOUNT ADDISON: Not the accounts?
LORD BALFOUR OF BURLEIGH: They are the operational statistics, which at present it is the duty of the railways and the canal companies to issue, but under this Bill they will not be available any longer. Under the Railway Company Accounts and Returns Act, 1911, the companies had to provide them, and if they failed to prepare and forward returns they could, on summary conviction,
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be fined five pounds for each day on which the default occurred. The Commission are not to be exposed to penalties of that sort, and it is very important that proper operational statistics should be available. I have in my hand the sot of returns made—miles run in relation to the company's total traffic receipts, miles run in relation to total expenditure, and that sort of thing. It provides a way of judging the efficiency of a system. At present the railways have to secure from the Tribunal a certificate of efficiency. There is no provision of that kind in the Bill and it is important there should be a gauge to judge the efficiency of operation in the future, compared not only to operation in the past but to other railway companies in other civilized parts of the world. I think it a very reasonable Amendment and beg to move.
Amendment moved—
Page 101, line 24, at end insert the said paragraph.—(Lord Balfour of Burleigh.)
LORD NATHAN: I agree with the noble Lord, Lord Balfour of Burleigh, that a measuring gauge such as he indicated is needed, but I would add that the returns and statistics issued in the past were very sensitive indices of the trade and prosperity of the country at any particular moment compared with the past and with other countries. I can assure the noble Lord that it is certainly the intention to continue all useful statistics hitherto issued and to add to them. Hitherto they related for the most part to railways and to a very minor extent to canals, and we hope to extend them to all the varied forms of transport and to amplify them. It is my right honourable friend's firm intention to ensure that statistical information shall be compiled in such a way that traders and the Transport Tribunal clay have some real measure of the operational efficiency of the Commission's undertaking, and that others may also from those statistics be able to form an opinion. I do not want a stereotyped form of those which are now in existence. The industry is growing; new activities are being allied to the railways, and for just those reasons which the noble Lord, Lord Balfour of Burleigh, has mentioned, I want the statistics and the returns to be extensive and informative, and to cover the various fields of activity. The noble Lord may be assured of the fullest sympathy with the objects which he has in view, and of

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the Minister's intention and determination to ensure that they are made available.
VISCOUNT SWINTON: A little earlier the noble and learned Viscount the Lord Chancellor advised us that we had better be careful about putting in Amendments, because when we express one thing it tended to suggest that we were excluding another. This clause says that the Commission are to keep proper accounts and to prepare an annual statement; and then it goes on to say certain things which are to be in the annual statement. But there is not a word about producing these operational statistics. Therefore, on the advice which the noble and learned Viscount, Lord Chancellor, gave, we surely ought not to put in that they are to keep accounts and that they are to produce certain statements, if we do not also include this. We really ought to insert this paragraph. The noble Lord said that he did not want statistics to be stereotyped. I wish he would read the Amendment which he is criticizing. The words of the Amendment are—and anything less stereotyped it would be difficult to find—
"Shall prepare and publish such annual returns and statistics in respect of each of the principal activities of the Commission as shall be comparable with the returns and statistics required to be kept or made under the …"
existing Acts. That is to indicate the kind of things there are. But observe how the Amendment goes on—how very moderate and amenable by noble friend Lord Balfour of Burleigh is. It says:
"… in such form as the Minister may from time to time direct."
Who can say that this is stereotyped? I understand the noble Lord is a lawyer by profession. He must not mislead the House in this way.
We have made great progress to-day, and noble Lords find it difficult to read, much less to understand, the language of all these Amendments as we canter, indeed, gallop, through the detail of this Bill. We look to the Government for an accurate exposition of these matters, and particularly to the legal- members of the Government. I believe it is a function of solicitors even to instruct the higher branches of the law. I hope they give a little more accurate instruction, otherwise they may receive something which was sometimes called "instruction"
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when I was at school, but it took a firm form. This really is a very reasonable Amendment, and, seriously, we ought to have it in the Bill, or something like it. If the noble Lord will forgive my saying so, I was a Minister for a very long time —perhaps I shall never be one again—and I learnt in the course of that long ministerial career not to say to either House of Parliament: "You really do not need this. I will give you an undertaking of what I am going to do" or "of what my right honourable friend is going, to do." No undertaking lasts going longer, at any rate, than the lifetime of a Parliament—that is quite certain—or of a Ministry. It has, of course, no binding force.
Now I am quite certain that the Minister must have instructed the noble Lord, Lord Nathan, to say that he proposes to do this kind of thing. I am quite sure that so long as he is there he will do this kind of thing. But how long is he going to be there? We do not know. I believe he has a safe seat, but we do not know that he will not be the first chairman of the Commission. It may well he that he will not be there, and then where does this undertaking take us? Quite seriously, it is not the right way to do it. This matter is very important. I had a good deal of sympathy with an Amendment moved by the noble Lord, Lord Lucas, in the Companies Bill. He wanted to get out for every trade in the country very careful returns and statistics of turnover which would enable one to compare every company in the country with every other. The Government thought he went a little too far, and my position was betwixt and between. I did not think it was very easy to compare the sort of beautiful Cartier detailed work with the work of the cheap jeweller who sells people like myself engagement rings. But I had great sympathy with that Amendment, and it is something we are always looking for. Parliament in its wisdom has laid it down—and the noble Lord, Lord Balfour of Burleigh, or one of the railway experts will tell me if I am wrong here—that the railways had to make operational returns. I think it is in the Act of 1921 or in one of the Acts of Parliament.
VISCOUNT SIMON: In the Schedules.
VISCOUNT SWINTON: If it has been thought right to have all these returns set

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out in detailed from while was still an amount of competition among the railways, why on earth could it not be done to-day? You are going to set up a monopoly which eats and consumes everything and it is really essential that we should have a standard of comparison. We may have such a monopoly in this country that we cannot compare it with anything in this country, but we can compare it with things which happen outside. The Americans produce the most careful statistics. The noble Lord said he had never seen greater inconsistencies than this. He has produced a series of Aviation Bills, though he has not produced many aircraft. In the Bills he has laid down under penalty that everybody has to produce the most detailed statistics, as has that great international body sitting in Montreal, to which we subscribe a great deal of money. I am all for that body, because I was party to its being set up, but it could work a little more quickly.
One of the things which was laid down there (and a similar provision is also laid down in the noble Lord's Act in regard to this country) is that all these operational statistics have to be obtained month by month, from all the operating air companies in the world, so that like may be compared with like and so that each may learn from the other. It is done in that way; and if, it is done by Act of Parliament for the existing railways, why on earth should we not have it in this Bill? That is all that this Amendments asks. It shows the broad form of returns which are wanted, but it leaves the Minister from time to time to settle the form in which the returns should be; and surely it is only good sense that that should be done.
VISCOUNT MAUGHAM: May I add one word to what the noble Viscount has said, unless the noble Lord is prepared to give in to this suggestion? I will not waste time if the Government are going to assent. There are two things which clearly are not provided for in the Bill as it stands. It is just as well that we should be quite clear what they are. One thing is this: there is nothing in the Bill as it stands to require annual accounts or statistics, and so on, to be made in respect of each of the principal activities of the Commission. Under the Bill as it stands these things could be lumped together as a whole and the total results given to us;
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but that is not what the Amendment is aimed at. The other thing is still clearer and still more important: there is nothing in the Bill about publication of annual returns and statistics. Of course, the Commission have to keep accounts, and that is all provided for in the clause to which this is an Amendment, except as regards the division to which I have already referred; but nothing is said about publication.
This Amendment does two things. It says there must be publication of such annual returns and statistics in respect of each of the principal activities of the Commission as shall be comparable with the provisions in subsection (5) of this clause, by railway and canal companies, in such form as the Minister shall from time to time direct. The very clause we are amending, in subsection (5), refers to these things. But it does not refer to the separation I have mentioned, or to the publication, which would be of great interest to the public.
LORD NATHAN: Your Lordships lave been so persuasive that I am now able to accept this Amendment, subject of course, as noble Lords will understand, to having a look at the language in which it is framed.
EARL HOWE: I must confess to being extremely nervous with regard to this Amendment, while I support it entirely in principle on the lines which the noble Lord, Lord Balfour of Burleigh, has indicated. But the noble Lord, Lord Nathan, went further; he said we are to have a vast extension of these statistics. Surely that means a vast extension of staff, and if we have another extension to our already enormous Civil Service it will cost a great deal of money. If you are going to increase the Civil Service very largely you will undoubtedly have to spend a great deal more money on this scheme than you thought you would. It will not be a very good advertisement for the Commission to have to raise railway rates to pay the wages of extra civil servants employed on statistics.
LORD RALFOUR OF BURLEIGH: Having heard the noble Lord on the desirability of not stereotyping statistics. I am glad to find how well my Amendment fitted the Bill. I am indeed staggered at my own moderation. I am very much

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obliged to the noble Lord for accepting the Amendment.
LORD NATHAN: The Amendment can go in on the footing that I am going to look at the language of it.
On Question, Amendment agreed to.
VISCOUNT SIMON VISCOUNT SIMON moved, in Subsection (2), to leave out "provide, as far as may be, separate information as respects the principal activities of the Commission" and insert:
"conform with the best commercial standards and distinguish between the provision of transport for the carriage of goods and passengers by rail, the provision of transport for the carriage of goods by road, the provision of transport for the carriage of passengers by road, the provision of transport for the carriage of goods by inland waterways, the provision of port facilities and the provision of hotels, hostels and other living accommodation and places for refreshment. And show separately the results of each such activity and include a trading and profit and loss account and a balance sheet in relation to each such activity."
The noble and learned Viscount said: Your Lordships will remember that the noble Lord opposite who is for the moment taking charge of the Bill felt that this Amendment and the one we have just agreed to were very much alike. They are alike, and I hope that he will accept this proposal also. The difference between them is this: the Amendment to which he has just in principle agreed is one that deals with statistics—with figures of course, but figures which do not involve the working out in money terms whether some particular portion of the undertaking is making a profit or a loss. This Amendment, on the other hand, deals entirely with accounts. Accounts necessarily involve figures, and nearly always in railway matters they involve setting the figure of receipts or profits on the one hand against the money figure of expenditure on the other. It is of great importance that in this vast consolidated undertaking, this monopoly which this monopoly which is being created by the Bill, a division should be made in the most clear form between different kinds of accounts. Even when we are concerned with only one railway company, it annually produces a number of accounts which are very informative and are of interest to others. Here we are dealing with a vast conglomeration of matters.
I quite recognize that there is already some
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I quite that there is already some general clause in the Bill dealing with this subject, There is a provision in the Bill at present that: "The Commission shall prepare an annual statement of accounts in such form… as the Minister may… direct with the approval of the Treasury," and there is a further provision that: "The said annual statement"—that is, an annual statement of accounts—"shall be so framed as to provide as far as may be, separate information as respects the principal activities of the Commission." The question is whether, in the circumstances, those words are sufficiently precise. They do go some way, but I would like the noble Lord to consider whether it is not very reasonable to put in the Bill provisions which are more specific. The provisions which we seek to put in the Bill are of this sort: that that annual statement shall be so framed as to
"conform with the best commercial standards and distinguish between the provision of transport for the carriage of goods and passengers by rail, the provision of transport for the carriage of goods by road, the provision of transport for the carriage of passengers by road, the provision of transport for the carriage of goods by inland waterways, the provision of port facilities and the provision of hotels, hostels and other living accommodation and places for refreshment. And show separately the results of each such activity and include a trading and profit and loss account and a balance sheet in relation to each such activity."
Assuming that any one of these activities was going to continue to be carried on by its present proprietors, I do not think there is any doubt at all that those undertakers would provide accounts such as are there described. The provision that it shall give "the best commercial standards" is one with which we are not unfamiliar, and surely it is important for everybody, both those who believe that the scheme is going to be a success and those who are anxious about it, to realize from the beginning that this distinction ought to be made in the accounts. I remember that the noble Lord, Lord Nathan, referred to it in an earlier speech before he admitted himself convinced by the Lord Balfour of Burleigh, and he assured us all, as a message from the Minister, that the Minister intended that "there shall be the most extensive and informative accounts"—I think those were the words.
I do not want to tie anybody down to too much detail. Whether he wants to

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go further than this, whether he wants to show how different parts of the country have fared, whether he wants to show now the railway system in Scotland has worked out in the matter of accounts and distinguish it from the railway systems elsewhere, or whether he wants to divide it into regions—that is entirely within his discretion. But in view of this being an amalgamation of undertakings—hotels, canals, railway docks, railways and roads—we say that in the interests of everybody and in particular of the public whom we all are trying to serve, there ought to be in the Bill a statement that the accounts mentioned in this Amendment are really presented separately. One most important point to ascertain, and a matter which the public would be most interested to know and which doubtless will receive the closest attention from the Minister of Transport, is this: How does the carrying on of the business of road goods transport compare, from the point of view of profit or loss, with the carrying on of railway transport? It may become most important to know that. We shall then see whether the difference is very considerable, and whether it is likely to diminish or otherwise.
We shall see—I am not speaking as a critic, but as public-spirited men and women would speak who want to understand the affairs of their country so far as they are in the hands of their Government—whether or not the way in which the road transport is managed by the Government produces profit or loss, and we shall be able to compare that with the way in which they handle passenger transport. Nobody can doubt that these things are all separately dealt with in the accounts of these various undertakings to-day. It is so because that is the proper commercial practice. In an important company you never find perfectly different operations all interlocked so that you have no means of knowing which of them is the one which is making money, and which is the one which is not, When these undertakings are all put together, so that it becomes one of the greatest single enterprises in the world, my suggestion to the noble Lord is that it really would be right to make a more precise statutory direction than exists in the Bill at present, whilst I should myself be entirely opposed to carrying the statutory
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language into such detail as really to leave no discretion to the Minister at all.
I cannot help thinking, with great respect, that if the noble Lord or I were advising people who were about to take charge of an immensely complicated thing of this sort, we should certainly say ah out each of the big departments: "This really is a department about which there ought to be separate accounts." It may be that it will prove to be a justification for the scheme; but, whether it is a justification or whether it shows a weakness in the handling of the scheme, it is essential that the country should know. There is no sense in putting together every sort of enterprise covered here and saying: "I will give you the accounts. That is as much as I think I can do." There is no legislative provision that we should separate, let us say, the accounts for the transport of the carriage of goods by road from the accounts for the transport of passengers by rail. I am sure that every enterprise that undertakes to do that sort of thing at present does makes such a separation.
I do not think there is any business man who would suggest that this was not a proper separation. I see very good business heads opposite me. I am not asking for anything unreasonable, but I do urge on the noble Lord, with great respect, that we ought really to show on the face of this Bill what is the minimum sub-division it would be proper to make, I realize that there may be cases where a particular item has to be split. You may conceivably have a garage which is used partly for passenger and partly for goods traffic by road; that is possible. No one is more familiar than the noble Lord opposite with the way these things are handled. There is a splitting of the accounts which is indicated on the face of it. There is nothing more common. You ask your chartered accountant: "How much of this common work should I put under one head, and how much under another?" That is my suggestion, and I hope that the noble Lord will feel that it is not an unreasonable one. I have not endeavoured to make a great example of it, but I am concerned and I think we are all concerned, that the separation of these accounts should be adequate. Having said that, though not endowed with all the powers of persuasion which my noble friend Lord Balfour of Burleigh so

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happily exercises, and without casting any spell on the noble Lord, I hope none the less that the argument which I have put forward is one which may receive his favourable attention. I beg to move.
Amendment moved—
Page 101, line 25, leave out from the end of the line to the first ("and") in line 27, and insert the said new words.—[Viscount Simon.]
LORD NATHAN: I have been familiar with the powers of persuasion of the noble and learned Viscount over a great number of years, and in a variety of different capacities; but although I may not at this moment admit that his persuasiveness has reached the degree of that of Lord Balfour of Burleigh it has achieved sufficient, at all events, to justify me in saying that I will certainly have this Amendment carefully looked at with a view to seeing whether we cannot go some distance with the noble and learned Viscount; and, if so, how far. But, as the noble and learned Viscount will understand, I must, as a safeguard, say that I am not committing myself. As I am not committing myself, I think that I ought perhaps to say a word or two about the Amendment.
The term "best commercial standards" has crept into a number of statutes where it is, I think, a very apt form of words. But I am not quite certain that it would be a very apt form of words in this Transport Bill. I am inclined to think that rather than "best commercial standards," a suitable phrase would be "most modern transport practice," because transport is a highly specialized industry. What is much more to the point is that transport accounting is a highly specialized form of accounting, which has developed over a long period of years, and to a great extent under statutory provision. I can certainly say that the Minister would wish to draw upon the long experience which I think has resulted, on the whole, in the development of a pretty satisfactory system of railway accounting. My right honourable friend certainly has no intention of abandoning any of the valuable principles that have been established over so long a period of years, but what he rather feels is that he ought to have a free hand to improve and develop the type of information which the existing Acts require, so that the information placed before the public may he even greater than that
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which has hitherto been published. I do not know how far the noble and learned Viscount is familiar with the kind of information and accounts that have hitherto been published. The noble Viscount, Lord Swinton, has been for more than one period of office President of the Board of Trade and he is doubtless familiar with this document, the Return of Capital, Traffic Receipts and Working Expenditure of the Railway Companies which extends over 142 pages for the year 1939—the last year for which it was available. This gives every kind of information, and is complete with a series of graphs in the appendix.
Then there is the form of accounts and statistical return under the Railway Act of 1921 extending to some ninety odd pages. The information given at present is therefore pretty extensive, and my right honourable friend is now confronted with the task of applying that kind of analysis which has hitherto prevailed in regard to railway companies to the various kinds of transport. As regards showing the different kinds of activities, the noble Viscount will realize—indeed I think he pointed it out —that in subsection (2) of the clause provision is made that the annual statement of accounts is to be so presented "as to provide, as far as may be, separate information as respects the principal activities of the Commission." In existing railway returns separate receipts and expenditure accounts are shown in respect of railways, canals, collection and delivery of goods and parcels, road transport, clocks, steamboats, hotels and refreshment rooms.
That may be taken as an indication of what will be and should be provided by the Minister in future, on the assumption that circumstances remain the same. But of course one cannot say exactly how the detailed boundaries of each category of activity will shape themselves, and it is difficult to give any final view in terms of concrete definition in respect of various categories. Let me assure noble Lords, however, that the Minister will aim at continuity, and it is very necessary to have continuity to compare the present with the past. I think probably that I have said sufficient, in view of my prefatory observations, to satisfy the noble and learned Viscount, and the noble Viscount whose name is also attached to this Amendment, that the matters to which this Amendment relates have been carefully

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considered and that there is little or nothing between us as to the substance of what is desired. And I will, as I have said, take an opportunity between now and Report stage of consulting with my right honourable friend as to whether, and if so how far, I would be able to accept this Amendment.
VISCOUNT SWINTON: I am much obliged to the noble Lord; I think this is not a subject which should be at all rushed. This is another clause which was not debated in another place. No words were said, much less a Division taken, on the whole of this subject. I agree about not stereotyping. You want the best practice in this kind of accountancy; a form of words if we mean the same thing is easily found, but we attach enormous importance to the fact—which was definitely conceded in the Coal Industry Nationalisation Act—that there should be a separation between the different activities. Under Section 31 of the Coal Industry Nationalisation Act, returns must conform to the best commercial standard, and we might look together at the Companies Bill and see if there is a form of words there. The Coal Industry Nationalisation Act goes on, "for all distinct colliery activities and each of the main and ancillary activities of the Board". We want to be very careful about words. The Transport Bill says
"The said annual statement shall be framed as to provide, as far as may be, separate information as respects the principal activities of the Commission."
Frankly, what we want is a separate balance sheet and accounts. What we want to know is, are we making a profit or loss on each of these transactions?
That is a perfectly simple issue. I am not saying it is wrong to subsidize a loss on your railways out of your roads. I suppose that is the whole purpose of jumbling all this business up together. Nobody has been a sterner critic in the past than the Labour Party, in what they allege that businesses have done. I am not sure that businesses have always been as guilty as they have said—and anyhow we have been careful in the Companies Bill to particularize this. What we say is that you must not have a concealed subsidy and you must not bring in the profit on road transport to make up surreptitiously the losses on rail transport. We therefore want to know exactly what is the profit and loss made on each of these different
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activities. I venture to emphasize that because the noble Lord said that—though I gather we are pretty well at one over this—the boundaries might vary. I am a little anxious about that. I am not trying to dictate how the Commission should run this business. As a matter of fact, as the noble Lord knows, I want to dictate to the Commission much less than he does; in fact my idea was that the Commission should be allowed to set up the kind of Executives they wanted. whether they were regional or not.
It may well be—I think it will be—that when the Commission get into their stride on these parallel lines, it is quite likely they will work through regional boards, which will embrace all the activities of the Commission. But because for the purposes of administration and local convenience you delegate everything except the major questions of policy to the regional boards—you give the broad directions, and the regional boards carry out the application—I do not want it to be said that we have blurred the lines and that all these things are mixed up together. I only wart to emphasize that we do know what is to be taken over— the railways, the roods, the canals, the passengers and the goods; there may be some more, Uncle Tom Cobley and all. And for each of these we want to know whether a profit or loss is being made, and how much on each of the transactions.
VISCOUNT SIMON: Distinguishing between goods and passengers.
VISCOUNT SWINTON: Distinguishing between goods and passengers. If we are substantially at one about that, I do not think there will be much difficulty in drafting what we want, and I hope that we shall arrive at a happy and agreed solution, as we did on the Amendment of the noble Lord, Lord Balfour of Burleigh, which we have discussed.
LORD BARNBY: Before we leave consideration of this clause may I remind the Committee that at an earlier stage in consideration of the Bill I raised this point, which clearly should be raised at this time. The noble and learned Viscount, Lord Simon, has clearly set out what is the danger if this clause is not inserted, and the noble Lord, on behalf of the Government, has emphasized his readiness to make sure that this safeguard

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is included in the Bill. An essential point, as the noble Viscount, Lord Swinton, said, is that we want to see that the accounts show whether profits are being made in each department. The manner in which this can be achieved is provided for, I suppose, differently under each of these Bills which provide for nationalization—we have recently had Cable and Wireless and Civil Aviation. The point I wish to raise is the manner in which this aim can be achieved.
I raised the question of the auditors and audits. Since the Electricity (Supply) Act of 1926, which established the Central Electricity Board, this is really the first large-scale national action of transferring a commercial undertaking to a centralized authority, which is tantamount to a monopoly. This transfer of activities to a central authority requires accounting of a character which permits the comparison of operating costs with the other operating activities. I take the opportunity, before we leave this clause, of asking the noble Lord, in considering how this is to be achieved, to draw the noble Lord's attention to the words at line 33: "in accordance with a scheme of audit approved by him", (that is, the Minister). I wanted only to take this opportunity of pointing out that the words I have just quoted do not give any assurance that the Minister will employ civilian accountants.
VISCOUNT SIMON: I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
VISCOUNT SWINTON: I think the next Amendment which stands in my name and that of Viscount Simon is consequential. I beg to move.
Amendment moved—
Page 101, line 33, after ("him") insert ("such scheme to conform with the best commercial usage").—[Viscount Swinton.]
LORD NATHAN: I am sorry I cannot accept this Amendment.
VISCOUNT SWINTON: Then we had better adjourn and take it to-morrow. I thought it was purely consequential.
THE MARQUESS OF SALISBURY: Will it not in fact come up in the discussions before the Report stage on the first Amendment?
LORD NATHAN: I am quite ready that it should.
VISCOUNT SWINTON: Then I will withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 94, as amended, agreed to.
House resumed.

LONDON MIDLAND AND SCOTTISH RAILWAY BILL.
Committed: the Committee to be proposed by the Committee of Selection.

SUNDAY ENTERTAINMENTS ACT, 1932.
Orders made by the Secretary of State for the Home Department extending section one of the Act to the

City and County of Kingston-upon-Hull;

County Borough of Darlington;

County Borough of Ipswich;

Borough of Bridgnorth;

Rural District of Blackwell;

Rural District of Mildenhall:

Laid before the House (pursuant to Act) for affirmative Resolution, and ordered to lie on the Table.
House adjourned at four minutes before eleven o'clock.