§ VISCOUNT SWINTONMy Lords, I beg leave to ask the question standing in my name on the Order Paper.
§ [The question was as follows:
§ To ask His Majesty's Government, what is the actual or estimated loss or profit made by B.O.A.C. during the last two years, and by the British European Airways Corporation and by the British South American Airways Corporation respectively since their incorporation]
§ LORD NATHANMy Lords, the accounts of the three Corporations for the year (or period) ended March 31, 1947, have not yet received the approval of the respective boards. But I am assured that they will be submitted to me for presentation to each House as required by Section 21 of the Civil Aviation Act, 1946, early in the coming month. In the circumstances I hope that the noble Viscount will not press me to depart from the normal rule of not anticipating formal presentation of the audited accounts and covering report to Parliament.
As regards the financial result of the British Overseas Airways Corporations' operations in the year ended March 31, 1946, the report and statement of account which were laid before your Lordships' House on March 20, 1947, disclosed a deficit of £5,789,706, but I must draw attention to the reservations made in that report explaining why it did not represent a true commercial result. For the reasons there given it would be wholly misleading to use it as a basis for comparison.
§ VISCOUNT SWINTONArising out of that answer, may I ask the noble Lord this question, in the first place? He says that the accounts will be submitted to him for presentation to Parliament at the beginning oE next month. In those circumstances, if he is to have the accounts at the beginning of next month, what I wish to be clear about is this. Does that mean that Parliament is going to get the accounts next month, or that the Minister is going to get the accounts? We do not know whether Parliament is going to get the accounts.
§ LORD NATHANThe accounts will be presented early in November, as the noble Viscount understands from what I have said. As soon as I receive the accounts, 166 I will take the necessary steps to lay them, but I am advised that the Stationery Office will take a little time to print them. So far as I am concerned, there will be no delay in making them available to your Lordships and to members in another place.
§ VISCOUNT SWINTONWe do not wait for any covering report from the Minister or auditor. The second point on the British Overseas Airways Corporation is this. The noble Lord has said that the accounts for the year ended March 31, 1946, disclose a deficit of five and three-quarter million pounds but that that was not a true commercial result. I am sure that the Minister will agree that it is very desirable—indeed, the Act of Parliament lays down—that the accounts should be presented in accordance with the best commercial practice. Am I not right in suggesting that they should be in a commercial form in order to show the commercial result? If these accounts in effect do not do so, could not the Minister produce them, or an abstract of them, in some simple form which would show whether on a true commercial basis the loss was bigger or smaller, and by how much, than this loss of nearly £6,000,000?
§ LORD NATHANThe noble Lord will appreciate that the accounts to which we have referred are the accounts of the British Overseas Airways Corporation for the period ending March 31, 1946—that is, before the Act under which we are now operating became law, and it covered the war period. It was explained that the accounts have been laid before Parliament and the report laid explained that the deficit of five and three-quarter million pounds, in round figures, shown in the accounts did not represent a true commercial result because, under war-time arrangements for the waiver of financial adjustments between Government Departments and the Corporations, no revenue was received for the carriage of mail and certain other Government traffic while, on the other hand, aircraft and spares, together with extensive services, facilities and other supplies from Government sources had been provided free of charge. The sums involved in these waivers were large and their exclusion from the accounts makes it impossible to determine the actual deficit incurred on operating the air transport services.
167 In the Corporation's report, however, it was estimated, on the basis of notional values of identifiable free services and supplies, rendered and received, that the deficit would have been approximately £519,000. This result was, however, materially influenced by the full loads carried under abnormal war conditions, the prevailing high levels of traffic charges, which have since been considerably reduced, and the omission or inadequacy of charges for services on the routes rendered by the R.A.F. Transport Command with which the operations of the Corporation were integrated, and for the reasons I have indicated I very much doubt whether it would be practicable or even helpful to try and get a comparable basis by which to lay these accounts, side by side with those yet to be produced.
§ VISCOUNT SWINTONI am very grateful to the noble Lord for that full explanation. May I make one other suggestion in the form of a question? I do not know what is going to happen in the future in regard to the shut-down that has completely come upon travel, but obviously that creates an entirely abnormal situation for the shipping lines, air companies, and for everybody. It is very important that we should get a standard of comparison of accounts over what are normal commercial periods. I will not press the noble Lord for an immediate answer, but will he consider favourably inviting the Corporations to produce to him in same form trading accounts which will show the period up to the compulsory shut-down on travel, so that we may have a fair view of what the Corporations were doing under what were relatively normal conditions?
§ LORD NATHANYes, I will most gladly give consideration to that, but the noble Viscount will appreciate that it is really one of the Corporations that is mostly affected—namely, British European.
VISCOUNT ELIBANKMay I ask the noble Lord, in view of the fact that it has taken eighteen months to bring out these accounts, is it intended in future to take as long? Is it not possible to bring out these accounts within a year of the end of the financial year?
§ LORD NATHANThe noble Viscount is under a misapprehension. The 168 accounts which I am about to lay are the accounts to March 31 of this present year.
§ LORD NATHANForgive me. The accounts which I am about to lay for the three Corporations are those to March 31, 1947, and I was hoping that I might receive some commendation for laying them within so short a period. The accounts to 1946, which have been mentioned by the noble Viscount opposite, are earlier accounts, which were laid in 1947.