§ 2.36 p.m.
§ House again in Committee (according to Order).
§ [The EARL OF DROGHEDA in the Chair]
§ Clause 38 [Accounts and audit and statistics]:
LORD HAWKE moved, to add to the clause:
( ) Where it appears from the accounts of a publicly-owned company that in any year such publicly-owned company has incurred a loss from its activities taken together the report of the Corporation required under section four of this Act shall draw attention to such loss and to the circumstances in which it has been incurred.
§ The noble Lord said: Under Clause 38 (3) (b) the Corporation are excused, where group accounts are produced, from producing the accounts of individual companies. This Amendment makes it certain that when a loss is made by a publicly-owned company the fact that the loss has been made, and the reasons for such loss, shall be published. It does not make it obligatory to publish the accounts of the particular company making the loss, though public opinion would no doubt demand it. This Amendment makes it certain that some degree of individuality will remain and that everything will not be swallowed up in the group. Some time ago the cry was for larger and larger units in industry, but in private circles this tendency has now been discredited. I believe that the moment you reach the size when the boss does not know every employee you begin to lose efficiency, and that loss can be made up only by some countervailing 748 advantages of size. It is now generally agreed that those countervailing advantages are by no means as abundant as was once thought.
§ Euclid has said that the area of the whole figure is the sum of the area of its component parts. The efficiency of the whole industry is surely the sum of the efficiency of its component parts. Noble Lords may say that profit is not the sole criterion of efficiency. I agree —the Coal Board have recently made a profit, and the Minister of Supply made a profit in a rising market. But I do not know whether there is a better yardstick for efficiency in industry, and profit-making may be the only type of internal competition that will remain in the iron and steel industry. It is the yardstick certainly understood by management, and if profits are sometimes deceptive losses are certainly the sign of trouble and require investigation. In this Bill there is no provision requiring individual companies to operate at a profit. There is all the more reason to know when they operate at a loss. We believe that this Amendment is necessary to preserve the esprit de corps, to maintain individuality, to promote efficiency, to preserve an element of competition inside the nationalised industry and to provide a warning signal if things are going wrong. I beg to move.
Page 44, line 46, at end insert the said subsection.—(Lord Hawke.)
This Amendment would have the effect of securing a little more information for the benefit of the unfortunate taxpayer who, so far as I can see, seems to be altogether left out of this Bill as drafted. Surely it is only right that the public, who are in fact the owners of this Corporation, should know in what circumstances a loss is incurred, and whether it is a publicly-owned company, which has incurred this loss. It may well happen that one company will he used to subsidise another over a period of years without the public—the owner—knowing anything at all about it. That situation might easily lead to unfair competition. I can see no reason at all why His Majesty's Government should not accept this Amendment. Surely it is their intention that each of the publicly-owned companies should stand on its own feet and be financially sound. I have little 749 doubt that the effect of this Amendment, if it is accepted, will be that the Corporation will be careful to see that no losses are incurred by the publicly-owned companies. I am sure that we all desire that there should be no such losses by these publicly-owned companies; and, if they are incurred, we feel they should be disclosed with the details of the circumstances surrounding the losses.
THE MINISTER OF CIVIL AVIATION (LORD PAKENNHAM)
I hope that the arguments which prevailed in another place will prevail this afternoon. A similar Amendment was moved there, but when an explanation was offered the spokesman of the Opposition felt that it covered the point. I will not pursue very far the general question raised by the noble Lord, Lord Hawke, because we discussed all these matters the other night. But under the Amendment that was carried then against the Government, in the teeth of our very strong opposition, the accounts of all these companies will be published. However, we cannot accept this Amendment, and therefore the House will, no doubt, wish to consider the matter in the light of what the Government propose. Even if that Amendment had not been carried, we could feel plenty of confidence that the information would be available. As I explained the other evening, detailed accounts will be filed with the Registrar of Companies, so there is no question of the information not being available. Information will be available and accessible to those who care to pay a small fee to the Registrar of Companies. I venture to ask noble Lords opposite whether they really desire to impose a particular obligation of this kind on the Corporation when forwarding its report to the Minister.
As was indicated in another place, there are all sorts of matters which are more important than this and which it will be necessary to include in the report of the Corporation. If we insist that this one matter must be referred to in the report, and leave out other more important matters, we may be defeating the very object which the noble Lord has in view. In other words, I am sure that if there are persistent losses of this kind it will be perfectly well known to the public; the accounts will be obtainable through the Registrar and the Minister can he pressed for particulars about them. Under Clause 4 750 (5) he can, if necessary, call for additional information and, if the public feel that additional information is necessary they can press the Minister for it, and I have no doubt that he will Ellie full consideration to their wishes and produce it. I ask the Committee not to insist on this Amendment which would put one particular obligation upon the Corporation in regard to a matter which, though of interest and significance, is not so important as some other matters which will be dealt with in the report.
§ LORD WOLVERTON
I think this matter is very important. Under present legislation, if any of its group of subsidiary companies have made a loss, a holding company has lo put in its consolidated accounts so that the shareholders can see them. We have been told time after time that this Corporation is a holding company, and I think the public have a right, through the Corporation, to know which of those companies has made a loss, otherwise they have to go to London and pay a fee to see the accounts. Can a copy of the balance sheet be sent by post?
§ LORD WOLVERTON
The noble Lord said that by paying a small fee anybody could go to Somerset House to see whether any of the operating companies had made a loss. That means that a person has to travel to London and pay a fee. Can a copy of the accounts be sent by post, or has a person to go to London?
I am not sure about that last point, but cannot regard that as an insuperable objection for someone really interested. These accounts will be available to the public. Do let us be clear about that. They will be available to the public, and we must disabuse ourselves of any idea that in some way they will be hidden away. They will be available to anybody who is anxious, interested and desirous, to inform the public how they are going. There is no question of this information not being completely accessible to everybody.
Would the noble Lord help us about one point which might determine our attitude towards this matter? There was an Amendment made by Division the other 751 day to secure the publication of accounts. If the noble Lord can indicate to us that, on consideration, His Majesty's Government are going to retain that Amendment it would of course condition our attitude towards this one. If that Amendment is to be retained, then the accounts will be much more readily accessible to the public than under the procedure which he has outlined. I appreciate that it may not be possible for him to say now, but it would certainly be advantageous to our consideration of the Bill if we knew that it was to be retained.
§ THE EARL OF DUDLEY
I want to support what has been said by my noble friend Lord Clydesmuir. The whole of Lord Pakenham's argument turns on whether that Amendment is to be retained. If that Amendment subsequently goes by the board, then this particular Amendment becomes all the more important. I would like to point out that Lord Pakenham, in his first speech, said that if losses were incurred by publicly-owned companies that fact would be perfectly well known to the public. I submit that he was quite wrong in saying that. Later on he said they would be available to the public if they so desired. But the accounts would not be perfectly well known because they could not be inspected publicly unless they were sought after through the Registrar. I think it is the duty of the Corporation in their report to make these losses known to the public. The noble Lord rather insinuated that it was an unimportant part of the report. I submit it would be one of the most important parts of the report, to show to Parliament and to the public whether these publicly-owned companies were making a profit or loss. It was pointed out by the mover of the Amendment that Clause 31 provides that the Corporation and the publicly-owned companies as a whole shall make ends meet. Surely it is only logical, following on that clause, to make provision that individual companies shall also show that they are making ends meet. I think there is a great deal more to this Amendment than the noble Lord has tried to make out, and I hope very much that on due consideration he will accept it before the Bill goes to another place.
Before the noble Lord replies may I ask him a question 752 about which I am in some doubt? An Amendment was passed to Clause 38, to the effect thatthe accounts of each publicly-owned company shall give or be accompanied by a statement giving separate information as respects to each of the principal activities,et cetera. That presupposes that the accounts of each publicly-owned company shall be published. And yet in subsection 3 (b) of this clause there is definitely a "let-out," in that where group accounts are published it is not necessary for the separate accounts of the publicly-owned companies to be published. Which prevails—the Amendment carried or subsection (3) (b)? Must these accounts be published separately by each publicly-owned company, or where group accounts are published can you leave out the components?
I have no new legal advice. If he asks: "Does the Amendment which was carried last time prevail over the original proposal of the Government?", the answer is that for the time being, presumably (I am speaking on this without legal advice), it does. That, I take it, was why noble Lords persisted in inserting the Amendment.
I have been asked whether there is any likelihood of the Government accepting the Amendment which was carried. I can say only that I think it most unlikely that the Government will accept it. I have not been in touch with my right honourable friend since it was carried, but judging from his previous attitude, and from the considered attitude of the Government, I think we must assume that the Government will resist that Amendment by every constitutional means. I have no information which suggests that the Government have changed their minds, and I think that it is wise to assume that the Government will not change their minds on that particular point. The noble Earl, Lord Dudley, accused me of insinuating something. I hope that he did not mean that in any unpleasant way—I take it that he was using the term in quite a friendly fashion. But, at any rate, the 753 noble Earl says that my argument loses all validity once we assume that the Government will insist on replacing the clause. The noble Earl suggests that my argument would apply only if the Amendment which was carried last time stood. Honestly, that is not so. Our whole point is—and we made it in resisting that Amendment— that the information will be there. The group accounts will be published, but where there are group accounts individual accounts will not be published, although they will be available.
I do not think it is advisable to handy words, and I do not propose to do so on the question as to whether they will be "known" or "available" to the public. There will be no automatic process by which accounts become "known" to everyone when they are filed with the Registrar, any more than if they were included in the report of the Corporation. But they will be completely available. Any financial journalist, any noble Lord will be able, if he wishes, to obtain full information concerning them. If he sees anything which he considers discreditable, no doubt he will be able to draw attention to it. As I say, we need not bandy words on this point. Whether the Amendment stands, (and, as I say, I have no reason to think the Government will agree to it), or whether the original clause goes back, this information will be available: there will be no question of it being "wrapped up." In the circumstances, I suggest that it would be a great mistake to impose this unnecessary obligation, which may cause trouble, on the Corporation. I beg noble Lords, whatever the view they may take with regard to the last Amendment, to agree that in another place they were right when they decided not to press this one to a Division.
I am sorry to interpose but I would like to ask the noble Lord one question. He said that this information would be available. I put this to him specifically. If I am a financial journalist, and I go to the Registrar of Companies, I shall, presumably, be handed a set of group accounts. Now suppose I say: "I want more than this. I want the component accounts from which these group accounts were made up—that is the accounts of the companies which form these group accounts." Do I understand that the Registrar, with 754 a charming smile, will say: "Here you are," and hand me the lot?
§ VISCOUNT BRIDGEMAN
Perhaps I may be allowed to put the noble Lord right on a point of detail. The Registrar might be charming, but he would not present anyone with the whole lot of the accounts. He would say: "Copy them if you like."
I think I might add to that that he would not divulge until he got his money. Frankly, I do not think the noble Lord has given us an adequate answer. He has glossed over the more important part of the Amendment, which is that the Corporation should give its comments on the losses. The financial journalist, when he goes to Somerset House, will not find the comments, of the Corporation, even if he finds all the individual accounts. The language of our Amendment and its impact on the other are, perhaps, matters which we might give further examination. I suggest to the noble Lord that he should think over the fact that it is the comment of the Corporation on these losses which is the most important point of the Amendment. Nevertheless, I think that at this stage we ought not to press the Amendment. We shall have to reserve our action for later consideration, and reserve for still later consideration the possible action which another place may take on the last Amendment. In the circumstances, I beg lease to withdraw this Amendment.
§ Amendment, by leave, withdrawn.
§ Clause 38, as amended, agreed to.
§ Clause 39:
§ Machinery for settling terms and conditions of employment of staff, etc.
§ 39.—(l) Except so far as the Corporation are satisfied that adequate machinery exists for achieving the purposes of this section, it shall be the duty of the Corporation, either directly, or indirectly by exercising control over publicly-owned companies, to seek consultation with any organisation appearing to them to be appropriate with a view to the conclusion between the Corporation and that organisation or, if the Corporation so decide, between publicly-owned companies and that organisation, of such agreements as appear to the parties to be desirable with respect to the establishment and maintenance of machinery for— 755
- (a) the settlement by negotiation of terms and conditions of employment of persons employed by the Corporation, and by publicly-owned companies with provision for reference to arbitration in default of such settlement in such cases as may be determined by or under the agreements; and
- (b) the promotion and encouragement of measures affecting the safety, health and welfare of persons employed by the Corporation and by publicly-owned companies and the discussion of other matters of mutual interest to the Corporation and those companies and such persons, including efficiency in the operation of the business of the Corporation and those companies.
§ 2.57 p.m.
LORD BALFOUR OF INCHRYE moved to add to subsection (1):
Provided that if the conclusion of any such agreement is likely to affect the interests of other employers carrying on activities similar to those carried on by the Corporation or by publicly-owned companies, such agreement shall not be concluded by the Corporation or any publicly-owned company except after consultation with such organisations as appear to the Corporation to represent the interests of such employers.
§ The noble Lord said: We now come to most important clauses 'which deal with conditions of employment, pension rights and compensation of officers, on which clauses there are several Amendments to be discussed. The purpose of the Amendment which I now move is to ensure that privately-owned corn-panics operating in the same field as publicly-owned companies are made aware from the outset of, and allowed to participate in, any negotiations on matters mentioned in these clauses undertaken by the Corporation or by the publicly-owned companies. The arguments in support of that purpose can be summarised quite briefly. The first, is that publicly-owned companies, in so far as they make or process iron or steel, will be competing in the same labour market as the independent men who are licensed to produce iron and steel under the provisions of the Bill. Secondly, and even more important, in so far as concerns the extraneous activities of the Corporation—which, as we know, range from tennis racquets to nails —they will be in competition for labour with a very large range of private industry.
§ Unless the Corporation are obliged to take these smaller producers, and these men who are engaged in similar production to the extraneous activities of the 756 Corporation, into consultation on matters such as wages, conditions of work and welfare, these persons and organisations outside the Corporation will gradually be forced out of business. It is the experience of the industry that concessions granted in one locality or in one sphere of work are very quickly claimed over the whole of industry, and, of course, the Corporation is going to be in a very favourable position as regards financial backing and financial facilities. Prior consultation, which is asked for, will not remove this possibility but it will at any rate give privately-owned companies an opportunity of representing their views and putting their case at the bar of public opinion. I would like to make one thing quite clear—and I feel sure the Government will accept this statement—that this Amendment is not intended in any way to impede reasonable developments in wage rates or to stop improvement in conditions of work or welfare, but it is designed to prevent unilateral action by the Corporation and publicly-owned companies in a common field. Unless it is obligatory for the Corporation and the publicly-owned companies to consult the licensed and free undertakings, there is a danger that the whole of the industrial relations structure within the industry, which has grown up and been most successful over so long a period, will disintegrate, to the detriment of nationalised and non-nationalised industry alike.
A similar Amendment was moved in another place and negatived on a Division. The Minister's main argument on that occasion was that it might be impossible for consultation to take place. He said that, for instance, an agreement might affect some small body of employers of whose interest the Corporation was not aware at all. We took note of the Minister's view and altered the Amendment so as to meet the point he made. In the Amendment put forward in another place the obligation was
after consultation with the organisations or persons representing the interests of such employers.
In the present Amendment the wording has been altered to read,
after consultation with such organisations as appear to the Corporation to represent the interests of such employers.
This not only meets the point made by the Minister in another place, but it also
has the desirable effect of writing into the Bill the Minister's own statement which I have quoted. This is a well-intentioned Amendment which I think is very reasonable, and I hope the Government will accept it.
Page 45, line 29, al end insert the said proviso.—(Lord Balfour of Inchrye.)
I should like to support the Amendment moved by my noble friend. The machinery in the iron and steel industry for settling wages questions is almost unique. It works very satisfactorily. It has borne the test of long years at a time when there was unrest in many industries—I refer to the decade after the last war, when the iron and steel industry was almost free (indeed, I might say it was free) from such troubles. I attribute that largely to the satisfactory nature of the machinery and the way in which it has worked. A large number of employers' organisations have grouped themselves together to meet the men, whose unions are also grouped. If nationalisation becomes a fact, the Government will fall heir to this very fine machine. The point already made by my noble friend is very important—namely, that there is a danger that the machine might perhaps, not disintegrate—that is too strong a word—but be very adversely affected if trouble arose between the free or licensed firms outside in some of the ancillary lines of business and the great Corporation with its iron and steelmaking publicly-owned companies.
So far as I can see, the labour relations and welfare problems of the privately-owned companies are almost forgotten in the Bill. There seems to be no reference to them, except as an afterthought in subsection (3). I believe that if the Government felt able to accept this Amendment it would ensure that there was, in labour and welfare matters, a high degree of contact between the privately-owned companies remaining outside and the great steel Corporation employing many thousands of men. I hope the Government recognise that this is intended to he a thoughtful and helpful Amendment. I urge that it should be treated in that light and careful consideration given to it. It would be an unhappy thing if the steel trade became nationalised and then some trouble that arose as between the State- 758 owned companies and privately-owned companies widened, and relations were affected throughout the steel trade. I attach importance to this Amendment and rank it high on our list as one of real importance to the human side of the industry. Up to now we have not dealt very much with this, perhaps the most important side of all, a side of the industry in which real advance has been achieved in recent times. This is a relatively small point, but I hope the Government will see their way to meet it.
§ THE EARL OF DUDLEY
I should like to say a word confirming what has already been said by the noble Lord, Lord Balfour of Inehrye, and the noble Lord who has just spoken. A good deal has been said about the good conduct story of the iron and steel industry so far. I have been a member of the Executive Committee of the Federation for a good many years and know something about how that good conduct story has been achieved. It has been achieved largely through complete and comprehensive consultations at all levels on all matters everywhere, taking into consideration anything that was or importance, minor and major, to the industry and anything affecting minority views, interests and opinions. Unless that sort of thing is kept up by the Corporation after it comes into being, then this good conduct story is hound to end. The Central Wages Board, for instance, settle all questions of wages in the industry as a whole, taking into consideration all questions relating to wages ranging throughout the whole industry, and all minority views and interests are taken into strict and close consideration. I can assure noble Lords opposite that there is a feeling among the undertakings who will be free or licensed under the Bill that they are going to have a very difficult time in competing with this enormous caucus, vested, as it will be, with special and outstanding powers and privileges which may not be available to other people. It is most important that the Government should do their utmost to do away with that feeling and give the smaller people, who are going to be very important for the country and the Corporation and the Minister, a little more confidence in the future, and make them feel that they will be brought into consultation a little more. Here is an opportunity for the Government to do that very thing. I 759 think it is important that the Government should either accept this Amendment or, if the drafting does not suit them, something very similar.
§ THE PARLIAMENTARY SECRETARY, MINISTRY OF WORKS (LORD MORRISON)
If I may use a modern phrase which is becoming popular, I could not agree more with most of the discussions taking place on this Amendment with regard to the excellent arrangements which have obtained for a very long time in the iron and steel industry. I can say only that, while for a reason which I will explain in a moment I am unfortunately not able to accept the Amendment, the Government are entirely in favour of continuing these relations and, if possible, improving on them. The noble Lord, Lord Balfour of Inchrye, said that private employers must be made aware of the proposals. Of course those proposals would not normally be initiated by the Corporation, but by the organised employees or employers. It would then become public that negotiations were taking place. I think the attitude of the Government is clearly conveyed by subsection (3) of Clause 39, to which the noble Lord, Lord Clydesmuir, referred. Subsection (3) says:Nothing in this section shall be construed as prohibiting the Corporation or a publicly-owned company from taking part together with other employers or organisations of employers in the establishment and maintenance of machinery for the settlement of terms and conditions of employment and the promotion and encouragement of measures affecting the safety, health and welfare of persons employed by them and the discussion of other matters of mutual interest to them and persons employed by them.I think those words give a clear and definite indication of the Government's purpose, so the point comes down to a very small one—namely, why the Government, while agreeing with most of what has been said, are unable to accept this Amendment.
The reason why the Government cannot accept the Amendment is that they would feel bound in respect of the wide range of activities with which they would be concerned to consult other employers where there is a remote possibility of their being affected. The Corporation could be relied upon to make the desirable consultations where necessary; for 760 example, the negotiation of a new wages agreement with a particular union, a substantial proportion of whose members were in the employment of private interests. The noble Lord, Lord Balfour, who moved this Amendment, referred to what happened in another place. He said they recognised the validity of what the Minister then said, which was to the effect that the Corporation would adopt a common-sense attitude, and would, where appropriate, consult all employers' organisations concerned. He was opposed to cluttering up the Bill with instructions to the Corporation to act in a commonsense manner. Moreover, the Minister argued that it might be dangerous, because if the Corporation failed to consult some small body of employers with remote interests, of which the Corporation were not aware, an agreement reached with the unions, although satisfactory to everybody concerned, might be invalidated.
The noble Lord said that as a result of that statement of the Minister the terms of this Amendment had been slightly altered. My difficulty is that I am advised that the revised Amendment, if I may use that term, is still unsatisfactory, because under it the Corporation must go looking around to find every type of employers' organisation which might be remotely affected. And if they did not succeed, and if thereafter it was discovered that they had missed one of these small organisations, the agreement made would be invalidated. I want to give a firm assurance that the Government desire to continue the existing machinery. If the noble Lord would look again at the point of his Amendment between now and Report stage—because I am advised that on legal grounds it still does not meet what he has in mind—perhaps we shall then be able to accept an Amendment.
§ VISCOUNT SWINTON
I am sorry I have been unable to be here for the whole of this discussion, but I would like to say a few words. Obviously we are very near agreement on this. The Government mean that where any substantial interest is involved they are certain that there will be consultation. We thought we had met the Minister's point by the word "appear." However, I can see that these words might impose a duty to look around 761 and, even where the smallest conceivable interest was affected, where the Corporation knew about it, that negotiations might be held up, which neither the Corporation nor the majority of the outside employers wanted held up. I would like something in the Bill, and I do not think it would clutter it up. I feel it is important—and this is common to both sides—to retain, not only in the iron and steel but in the engineering industries the extraordinarily well-established system of negotiation. There has been trouble enough lately with the difficulty of maintaining this well-tried machinery. Therefore, I would like to see in the Bill something which takes into account and registers that there is a first-class organisation, not only in the steel trade but in many of these engineering firms outside. We have to remember—the noble Lord said this--that we are taking over ninety-four companies with a whole lot of subsidiaries, and many negotiations will be concerned not only with the Iron and Steel Federation but with the engineering and other unions who will come in. The noble Lord will see the difficulty in the argument which is going on to-day in the railway organisation: the shopmen say that if an agreement is made with the railwaymen it cuts across an agreement with the shopmen. Therefore, I would like to have in the Bill words to which we can all subscribe and which would show that, where there is a substantial agreement involved, then the negotiations would follow.
§ LORD MORRISON
In reply to the noble Viscount, I can say only that, in any conversations that take place before the next stage of the Bill, this matter might well be included to see whether it is possible to meet this point at which we are both aiming.
§ LORD BALFOUR OF INCHRYE
I am grateful to the noble Lord. There is nothing of principle between us, but only the application of the principle. We shall be happy to enter into consultations, so that either the Government might put down an Amendment, or we might put down another Amendment, at a later stage. On that basis, I beg leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Clause 39 agreed to.762
§ Clause 40 [Provisions as to pension rights]:
§ 3.18 p.m.
LORD BALFOUR OF INCHRYE moved, after subsection (2) to insert as a new subsection:
( ) In the case of persons who have been in the employment of companies which come into public ownership any regulations made under this section shall be so framed as to secure that where either—
The noble Lord said: The purpose of this Amendment is to protect the position of the individual who may expect a pension in accordance with the established practice of his company, even though no pension scheme is in force in his company. This is a somewhat complicated matter, and I will endeavour to make my point in as few words as possible. Subsections (1) and (2) of Clause 40 refer to pension schemes, pension funds, and pension rights under a scheme. Regulations which the Minister may make can deal only with rights under a scheme. The definition of "pension rights" on page 59, says that it
includes…any expectation of the accruer of a pension…under any customary practice…
Since the provision that persons shall be no worse off refers only to pension rights under a scheme, the position of persons having pension rights which derive from an expectation of accruer under customary practice is not safeguarded by the definition which I have just read to the Committee.
A similar Amendment to this was moved in another place, but was withdrawn on an undertaking by the Government to insert "customary practice" in the definition of "pension scheme." The Government fulfilled that undertaking, but we feel that the position still remains
unsatisfactory, because the definition on page 59 now reads:
'pension scheme' includes any form of arrangement for the payment of pensions, whether subsisting by…customary practice or otherwise.
Persons having such an expectation include those who do not have pension rights deriving from a pension scheme but who have grounds for expecting that, in accordance with the normal practice of their company, they will in due course receive a pension similar to that paid by the company to other comparable individuals, even though no actual pension scheme exists. Nothing may exist which could be described as even a form of arrangement. It is to cover these cases that this Amendment is proposed.
§ The Amendment will also cover another class of case, which is not so common—that of persons who are promised, on their entry into a firm, that they will receive a pension, dependent upon the prosperity and circumstances of the company at the time when they retire. This Amendment also seeks to safeguard the rights of persons who are receiving a pension as a result of, say, the employment of the husband. It is usual, if an employee dies, for the firm to pay his dependants a pension. In some cases, also, a retirement pension is paid jointly to husband and wife, without the existence of a scheme and without the existence of any form of arrangement. Finally, it should be noted that the wording of the proposed Amendment follows closely the wording used in Section 37 (2) of the Coal Industry (Nationalisation) Act, 1946. I trust that I have put the rather complicated point in a way in which the Minister understands it. I am sure that the noble Lord understands it better than I do, and I beg to move the Amendment, in the hope that the Government will accept it.
Page 46, line 40, at end insert the said subsection.—(Lord Balfour of Inchrye.)
I should like briefly to support this Amendment. Indeed, I cannot believe that there can be much between us and the Government on this point. They have already shown evidence of their good intentions by their Amendment on the Interpretation Clause. I would hazard a guess that this is merely 764 an oversight on the part of the draftsmen, and I think that all we are trying to do is to make this matter water-tight. I have great hopes that the noble Lord will be able to meet us.
§ LORD MORRISON
As the noble Lord has indicated, this is a rather complicated matter. He has given a brief account of its past history, and I think the best thing I can do is briefly to recount that history from the angle from which the Government see it. If I do so, I think both noble Lords will be satisfied that the point has now been met. This Amendment, as I think the noble Lord indicated, together with certain consequential Amendments, was discussed in another place. In another place the purpose was stated to be to ensure that the employees who receive, or are likely to receive, pensions by virtue of customary practice, as distinct from some formal pension scheme, are not prejudiced by this clause. After argument in another place, the Minister offered to insert in the definition of "pension scheme" words which would make it clear that the definition included a scheme subsisting by virtue of customary practice. The Opposition in another place were not wholly satisfied—which is not unusual for them —but they withdrew their Amendment in the expectation of being able to discuss the Minister's proposed Amendment when the Interpretation Clause was reached. As it happened, the Minister's Amendment—the insertion of the words "customary practice," which now appear at the end of line 33, on page 59—came under the guillotine, and no opportunity for discussion arose and there was no Division.
The same block of Amendments to Clause 40 were put down in another place on the Report stage, but were again guillotined. The main Amendment now appears in your Lordships' Committee, but without the consequential Amendments. This leads me to think (I may be over-optimistic in thinking so) that the Opposition are now seeking an assurance from the Government that the clause does in fact safeguard pensions obtaining by customary practice. That assurance I can definitely give. The difference between this Bill and the other Nationalisation Acts is that this Bill does not effect any change of employer. Persons employed by the companies which 765 come into public ownership under the Bill will remain in the employ of these companies, and accordingly, except in so far as they are replaced by regulations made under this clause, pension arrangements will continue to remain in force under this Bill. Wherever such arrangements are replaced, subsection (2) secures that persons having pension rights under the old pension scheme will not be placed in a worse position.
If noble Lords will now turn to Clause 58, on page 59, they will find the definition which the noble Lord has quoted. It says:'pension rights' includes, in relation to any person, all forms of right to or eligibility for the present or future payment of a pension to or in respect of that person, and any expectation of the accruer of a pension to or in respect of that person under any customary practice and includes a right of allocation in respect of the present or future payment of a pension;The clause goes on:'pension scheme' includes any form of arrangements for the payment of pensions, whether subsisting by virtue of an Act, trust, contract, customary practice or otherwise.I hope that I have convinced noble Lords that the purpose of their Amendment has been met.
§ VISCOUNT SWINTON
Your Lordships will remember that when we were discussing the Coal Industry Bill we had a long discussion on this point, not because we differed much in what we wanted to do, but because of the extreme difficulty of finding the right words in which to do it. On that occasion, we had the advantage of the assistance of the Lord Chancellor. We finally settled a form of words which covered both the difficult problems of making sure that everybody who had any right or expectation was covered, and also the even more difficult problem of how expectation was to be assessed. When we come to assessing an expectation of accruer—which I agree has to be done under regulations; indeed, the whole of this assumes regulations and is directed to what the regulations shall contain—I would like an assurance, which I am sure will be forthcoming.
What I would like is an assurance that what we settled about coal with regard to the difficult question of how "reasonable expectation" is to be interpreted will 766 apply here, because we want the same principles to apply in all these cases. I am speaking for myself here, because these provisions are extraordinarily difficult to follow, not because they are badly drafted but because this is a very complex subject. I think the Bill covers anything in the nature of a scheme or an arrangement. But is the noble Lord completely satisfied that it covers the case where an individual would be entitled to something because of the customary practice of the particular firm in which he is engaged? I know he has read out to me the passage on page 59:'pension scheme' includes any form of arrangements for the payment of pensions, whether subsisting by virtue of an Act, trust, contract, customary practice or otherwise.If the words, "customary practice" stood alone, I should imagine that they would cover the case governed by the practice of the individual firm. But would not the words "customary practice" in the definition of "pension scheme" be governed by the earlier wordsany form of arrangements for the payment of—"?That, I think, is the difficulty, and it has been suggested to us that that requires words to cover something which is not a "form of arrangements": that "form of arrangements" presupposes a formal scheme of sonic kind, whereas a number of these advantages are, as the noble Lord knows, not a mutter of right but a matter of expectation under custom. Indeed, this cannot be made the subject of a hard and fast scheme, because the whole thing depends upon the continued existence of the company and on how the man behaves himself. "Expectation" means, in effect, that if I have behaved myself, and have lived, and things have gone well, then I should get something. But that is something so conditional that it cannot be put into a cut-and-dried scheme, although it is something which we have admitted in all these Acts as a very real thing, because by custom the good company treats its employees in that way. It is people of that sort we want to safeguard here, because they have been in the very best employment—and the best employers generally get the best workmen. I should be glad if the noble Lord could inform me whether the individual case, the discretionary case, is covered, or whether it has to find itself placed in a "form of arrangements."
§ LORD MORRISON
I agree that this is a complicated matter, and I can only say that I have had an opportunity of consulting the best legal advisers avail-able, who assure me that the words "any form of arrangements" are as wide as they can be. The word "arrangements" is always used to cover an informal as well as a formal scheme; it means something arranged.
§ VISCOUNT SWINTON
It is the word "scheme" that worries me a little because it is not quite a scheme; it is a personal arrangement subsisting conditionally between a company and an individual employee. A very good company has been in the habit of treating its people very decently, but you cannot call that a scheme; it is a way of life, a habit of behaviour. That is why the words "customary practice," with which I have no quarrel, have been used. Nevertheless, I find it hard to see how treatment of this sort can be put into a "form of arrangements."
THE MARQUESS OF READING
Perhaps I may be allowed to make a suggestion which may be helpful. It is that some words as these should be used:'pension scheme' includes any arrangement, express or implied, for the payment of pensions.
§ LORD MORRISON
The difference between us is very small and, speaking for myself—I am not qualified to speak from the legal point of view, though I am assured on the matter by the best legal advisers that the Government have available—I am satisfied that the clause in fact safeguards pensions given by customary practice. However, the noble Marquess has made an alternative suggestion which I will have examined, if that will meet the views of the noble Viscount, Lord Swinton. If these words are found to be better than the words of the existing clause, and if they will result in securing more certainly what the Government believe is provided by the clause as it stands now, we will certainly consider it and the matter can go further.
§ LORD BALFOUR OF INCHRYE
No words have fallen from the lips of the noble Lord that in any way make us think that we do not share a completely commonpurpose—the purpose of safeguarding both formal and informal arrange- 768 ments. We have only to make sure which method of execution is the better. No doubt the Government will in due course let us hear the result of their deliberations on the suggestion made by the noble Marquess. Meanwhile I thank the noble Lord for his kindly reception of my Amendment, which I now beg leave to withdraw.
§ Amendment, by leave, withdrawn.
§ Clause 40 agreed to.
§ Clause 41:
§ Compensation to officers in connection with transfers
§ 41.—(1) The Minister shall by regulations require the payment either by the Corporation or the company, in such cases and to such extent as may be specified in the regulations, of compensation to officers of any company which comes into public ownership under Part II of this Act, being officers who suffer loss of employment or loss or diminution of emoluments or pension rights in consequence of the company becoming a publicly-owned company.
(3) Regulations made under this section—
(b) may in particular contain provisions enabling appeals from any determination as to whether any or what compensation is payable to be brought, in such cases and subject to such conditions as may be prescribed by the regulations, before a referee or board of referees appointed by the Minister of Labour and National Service, after consultation with the Lord Chancellor or, where the proceedings are to be held in Scotland, after consultation with the Secretary of State,
and where any such provision is made as is specified in paragraph (b) of this subsection, the decision of the referee or board of referees shall be final.
§ 3.38 p.m.
LORD BALFOUR OF INCHRYE moved, in subsection (1) to omit "and to such extent." The noble Lord said: The purpose of this Amendment is to delete the provision that regulations made under this clause shall specify to what extent compensation is to be paid to officers for loss of employment or loss or diminution of emoluments or pension rights. As the noble Lord said on the last Amendment, these are very important clauses. I remember that on the Second Reading of this Bill, the noble Viscount, Lord Addison, used these words:
There are two clauses in this Bill, Clauses 40 and 41, which are very important and which have not been discussed in another place, and to which I hope your Lordships will do full justice.
That is what we are trying to do this afternoon. As the Bill is now drawn, it is left to the Minister to determine by way of regulation the limits of compensation payable, and we feel that that in itself is an injustice which might lead to considerable hardship. It has already happened in the case of officers employed by the railways before nationalisation. The Transferred Undertakings (Compensation for Employees) Regulations, 1948, in defining the net emoluments for purposes of compensation, laid down that any amount by which the emoluments exceed £4,000 per annum shall he disregarded. We feel that it is very unjust that an official earning say, £6,000 or £10,000 a year, or whatever he may be thought worth, should have the excess of his salary over £4,000 disregarded in assessing compensation for loss or diminution of pay. A commercial company does not pay high salaries to its officers unless those officers are worth it.
It seems to me that the Government may have difficulty in resisting the principle behind this Amendment, when in another place it has refused an Amendment in Committee to limit the salaries of members of the Corporation to £5,000 a year. On that occasion the Minister said:
I suggest that the Amendment ought to he rejected and the Minister allowed freedom to pay what salary appears appropriate for the job and for the man involved.
That is the "rate for the job" principle. We cannot see why it should not apply to compensation for loss of the job. It is inconsistent that the Minister should have power to restrict the amount of compensation payable to the officers who suffer loss due to the enactment of this Bill. I hope the Government will look sympathetically at this Amendment. I beg to move.
Page 48, line 6, leave out ("and to such extent").—(Lord Balfour of Inchrye.)
I should like to support this Amendment because I think it is in the interests of elementary justice that an Amendment of this kind should be put into the Bill. The Amendment does not seem to me to impose very great difficulties upon the Government. It is not as if we were asking for all claims put forward to be admitted. A man has to prove his case first but, he having proved his case, it seems unreasonable that the 770 Government should, by an arbitrary decision of their own, be able to decide upon how much of his salary they consider he should be paid compensation. I cannot see that there is any justice in such an arrangement. I am sure the Government would not wish unnecessarily to cause injustice to people who deserve very well of this most important industry. I therefore hope that the noble Viscount will accept this Amendment.
§ THE FIRST LORD OF THE ADMIRALTY (VISCOUNT HALL)
This is one of a series of Amendments similar to those which were put down on previous nationalisation Bills. I am afraid that I cannot accept the Amendment for this reason: that Clause 41 is for the purpose of making the regulations. If we leave out these words, as suggested in the Amendment, it will not prevent the fixing of a maximum in the regulations. I think it would be much better, if any exception is to be taken to anything in the regulations, to raise that matter when the regulations, which will have to appear not only in your Lordships' House but also in another place, are presented. They will deal not only with cases such as that which was mentioned by the noble Lord, Lord Balfour of Inchrye, but also with other cases. I think it very much better that we should allow discussion in relation to the regulations to take place when the regulations are presented.
§ LORD BALFOUR OF INCHRYE
think the noble Viscount probably wins, on balance of argument. That being the case, I ask leave to withdraw my Amendment.
§ Amendment, by leave, withdrawn.
§ 3.44 p.m.
LORD BALFOUR OF INCHRYE moved, after subsection (1), to insert:
( ) An officer shall be deemed for the purposes of this section to have suffered loss of employment or loss or diminution of emoluments or pension rights in consequence of a company becoming a publicly-owned company if at any time within five years after the date of transfer—
The noble Lord said: The purpose of the Amendment that I now move is to ensure that an officer or a whole-time director who resigns from the employ of a publicly-owned company because he is given unreasonable duties, or alternatively who is dismissed on the ground of redundancy, or has his pay reduced because his duties are less than before the vesting date, shall be able to claim compensation. As at present drawn, the clause grants the right to compensation only in cases of actual
loss of employment or loss or diminution or emoluments or pension rights.
I think that on consideration your Lordships will agree that these are not the only ways in which the passing of a company into public ownership may operate to the disadvantage of its officers. May I give two or three examples of the way in which a man could suffer adversely? Heavy additional duties might be made upon an officer with no corresponding increase in his emoluments; or he might be required to carry out duties totally different from those for which he originally joined the company. Again, an officer's services may be dispensed with, not at the time the company passes into public ownership nor even as a direct result of that passing, but some years later, as a result of a scheme of reorganisation forced upon the company as an indirect consequence of the passing into public ownership. Or, lastly, a company may reduce the emoluments of an officer, again possibly some years after the company has passed into public ownership, because, though not actually redundant, he is required through reorganisation to perform less important duties.
§ In all those cases, we feel that officers should be able to claim compensation under this clause, and the Amendment seeks to make that possible. In relation to the Amendment we have inserted a period of five years as a reasonable period 772 within which the companies should be able to settle down under the new régime and any scheme of reorganisation resulting from nationalisation should be completed. A clause on somewhat similar lines was included in the London Passenger Transport Act. A similar clause was moved in Standing Committee on the Electricity Bill, but was withdrawn because the Minister of Fuel and Power gave an undertaking that his regulations would make provision for such cases, which substantially they did. We would prefer to have it in the Bill, if it is possible. However, if the noble Viscount tells me that the Minister will look after this position in the regulations, I will accept that as a second best. But I still hope for the full best. I beg to move.
Page 48, line 11, at end insert the said subsection.—(Lord Balfour of Inchrye.)
§ VISCOUNT HALL
I do not want to take up too much of your Lordships' time, because I feel that both before and after the regulations are drafted there is a considerable amount of work to be done. It has been promised in another place that consultations will take place, not only with representatives of the trade unions but with representatives of other groups as well. The definition of "officer" given in Clause 58 includes everyone from managing-director down to almost the office boy. I feel it would be very much better to allow discussions to take place between the Corporation and the companies—because they will have to take place with the companies—so that they can get the best type of regulation suitable to the iron and steel industry. I would point out to your Lordships that there will be much greater difficulty in arriving at suitable regulations for this industry when it becomes nationalised than there were for either the gas or electricity industries. A certain amount of statutory right existed in the electricity and gas industries. In this case, however, a number of companies are being brought in, and that may well mean that a different type of regulation will have to be framed in relation to this industry from those of other industries.
The noble Lord, Lord Balfour of Inchrye, moved a similar Amendment to the Gas Bill, and at that time my noble and learned friend the Lord Chancellor 773 said that, so far as he was concerned he wanted as sympathetic an approach as we could possibly have in relation to what it was intended that the clause and the regulations should cover. I entirely agree with that. At the same time some regard must be paid to consumers' rights; indeed, if I were an employer—which I am not—some regard would have to be paid to analogous or similar industries which have not been taken over in relation to matters of this kind. But these are matters with which the industry itself (for, as the noble Earl, Lord Dudley, said, it has the appropriate wages structure) should deal. It is much better that the old British habit of negotiation first and regulations afterwards Should apply in this case, and that I think will be much more beneficial than to insert this provision into the Statute.
§ LORD BALFOUR OF INCHRYE
I accept all the noble Viscount says. He makes a point about the difficulty there will he in having regulations for this industry, as compared with other nationalised industries. But the noble Viscount has not given us any words at all as to his views on the general proposition I put forward—that for a period of, as we say, five years a man should be protected from ill-effects on his personal career due to changes arising from nationalisation. The noble Viscount said he relied upon what he called the British way of negotiation. What I would like to know is whether the Minister is averse or otherwise to meeting sympathetically cases such as I have put forward; and whether, for a period of time ahead (perhaps not the exact time that I have stated, but for some very considerable period), he would he prepared to meet sympathetically cases such as those that I have put forward and others. If this is the spirit in which negotiations in regard to regulations are conducted, then I think there is probably nothing much between us.
§ VISCOUNT HALL
So far as dealing with cases which might or might not arise three, four or five years ahead, or indeed cases which might arise before the regulations are brought in, I may say that the regulations will be retrospective to the time when the industry is taken over, if such should be the case. The regulations will govern the industry during the period they are in operation, which will be for some time. I do not think the noble Lord 774 need have any apprehension in regard to that matter. If there is any concern about it, I am sure that those who are responsible for negotiating on the side of those who are to be protected will see that they are protected in that way.
§ THE EARL OF DUDLEY
The noble Viscount quoted me as having referred to the "good conduct" story in the past of the industry in all these matters. But I was referring to what has happened so far, not to what will happen if this industry passes into public ownership. Indeed, I have seen similar cases occurring in other nationalised industries—particularly the railways—where an officer's Whole life and his whole job are completely revolutionised by this act of nationalisation and change in organisation and, also, by the necessity, under nationalisation, of measuring him to a large extent by the Government yardstick and by the fear on the part of the Government and the Department of doing anything which may cause a precedent which will create embarrassment in future cases. In the steel industry so far there is naturally a great deal more elasticity in that respect. We do not judge individual cases by a yardstick; we judge individual cases on their own merits; and we are not so frightened as the Government are bound to be, of creating a precedent by giving special treatment to an individual.
All these questions and difficulties are bound to arise in a reorganisation of this kind, when these companies are subjected to regulations framed by the Government and given instructions issued by the Minister and the Corporation. All sorts of things may happen to these officers. Fresh work may be put upon their shoulders; through no fault of their own, they may be put into an entirely different position and on to a lower level, merely because it so happens that that is the way it fits into the Government organisation. I think that for this period of five years, they should know better where they stand, and how they will be compensated in cases of suffering. I hope that the Minister will give further consideration to this matter between now and the next stage of the Bill.
I would like to support what my noble friend Lord Dudley has said. I listened carefully to what the 775 Minister said, and I tried to put myself into the shoes of one of these people who might be displaced, and I did not gain much consolation from what the noble Viscount said. My noble friend mentioned a number of possible things which could occur to one of these employees of the Corporation, and the noble Viscount, with the dexterity of which he is a master, did not make any commitment or say that he would accept the probability of any one of them. My noble friends and I are not entirely happy about this matter, and I do not believe any of the people in this industry will feel very happy about it. I wonder whether the noble Viscount could go further to meet us on this point?
§ VISCOUNT HALL
I wish I could, but the position is that they will be governed by the regulations. I cannot anticipate what will be inserted in the regulations. It may be that the noble Earl, Lord Dudley, will be one of those who will negotiate on behalf of the persons to whom he has referred.
§ VISCOUNT HALL
Well, it is to be hoped that he will. If he is interested, as I know he is, in the future of a number of these people who have served him well perhaps he will take part in the negotiations. I do not want the Committee to think that I am in any way controversial about this. There will be given to this industry, by regulations, statutory rights which have never before existed in the industry. It is true that a number of persons might have grievances over a period of five years, but they would be very few in proportion. I am not suggesting for a moment that they ought not to be protected. They should be protected, and I have no doubt there will be someone representing those persons who will see that protection is given them. It may be that the companies themselves will help in this way. After all, this case is entirely different from Gas and Electricity. We are hoping that the companies will remain in existence and that there will not be any such changes as the noble Earl, Lord Dudley, rather fears. We are hoping that there will be stability in this industry, not only for a period of five years but for very much longer. 776 Again I would ask the Committee to leave this matter to be negotiated as I have suggested.
§ LORD BALFOUR OF INCHRYE
We are not completely satisfied. The only feeling of satisfaction we shall really enjoy will be when the regulations are finally issued, if they contain all that we feel they rightly should. With the hope that that may be the case, I beg leave to withdraw my Amendment.
§ Amendment, by leave, withdrawn.
§ 4.0 p.m.
LORD BALFOUR OF INCHRYE moved, in subsection (3) (b) to omit the first "may" and insert "shall." The noble Lord said: The purpose of this Amendment is to oblige the Minister to include in his regulations as to compensation provisions for a right of appeal in cases of dispute about the amount or the terms of compensation under the clause. We feel we should not leave to the Minister the discretion to grant this right or not as he thinks fit; the right of appeal should be open to the aggrieved person as a matter of course, and not at the discretion of the Minister. The second part of Clause 40 (3) provides that:
Any dispute arising as to whether or not the said result has been secured by any regulations made under this section shall"—
I emphasise the word "shall"—
be referred to a referee or board of referees…
It seems to us that there is no good reason why disputes about compensation terms should be treated any differently. That being the purpose of the Amendment, I beg to move.
Page 48, line 28, leave out ("may") and insert ("shall").—(Lord Balfour of Inchrye.)
§ VISCOUNT HALL
The noble Lord, Lord Balfour of Inchrye, moved a similar Amendment to the Gas Bill, and he was briefly replied to by the noble and learned Viscount the Lord Chancellor. In order to shorten the proceedings, I think I cannot do better than quote what the noble and learned Viscount then stated. He said:I must object to the noble Lord's Amendment on grounds of drafting. It is inappropriate to use the word 'shall' when you follow it with the words 'in such cases and subject to such conditions,' because you can- 777 not say that anyone must do a thing if you go on to say that you wish to specify the conditions under which he does it. That would be wrong. This is a revolutionary proposal and I am astounded that such a proposal should come from so respectable member of our society. I regret I cannot accept the Amendment.The noble Lord at once replied:I admit defeat and I beg leave to withdraw my Amendment.I do not want the noble Lord to admit defeat now, but I would ask him to withdraw this Amendment.
§ VISCOUNT SWINTON
I am not at all sure that we were not "taken in" by the Lord Chancellor last time. I was present, but his eloquence overcame me. I thought then that he was right, but now I am not at all sure that he was not entirely wrong. Look at what it says in the Bill. It says that regulations made under this clause:shall prescribe the procedure to be followed in making claims for compensation, and the manner in which and the person by whom the question whether any or what compensation is payable is to he determined.There is a great deal of discretion in that. The procedure is to be prescribed and the manner in which and the person by whom the question whether any or what compensation is to be payable is to be determined. I do not think there could be a much wider discretion than is set out there. Subsection 3 (a) contains the word "shall." Then paragraph (b) states:may in particular contain provisions enabling appeals from any determination as to whether any or what compensation is payable to be brought, in such cases and subject to such conditions as may he prescribed by the regulations.It is quite true that the regulations must prescribe the way in which the appeal is to be brought and, no doubt, the cases in which an appeal may be brought. But you get that in the ordinary right of appeal in the courts. There are Rules of Court which lay down exactly how and in what circumstances an appeal is to lie. That does not deprive the litigant of his right of appeal.
What I would like to know—though perhaps the noble Viscount cannot very well answer this as the Lord Chancellor is not present—is this. The Lord Chancellor's argument was that if you alter "may" into "shell" it means that the Minister has no discretion in framing the regulations. But supposing the word 778 "may" is there instead of the word. "shall," would not the Lord Chancellor, or whoever makes the regulation, be entitled to say: "It is may,' not and I propose that there shall be no appeal in any case." I am sure that that is not what is meant. I sure that what is intended is that whatever the regulation provides for, there shall be an appeal. The Lord Chancellor objected to the word "shall" only because he thought it would deprive whoever made the regulations of the right to say what were to be the cases and conditions under which an appeal was to be brought. My difficulty is that if "may" is retained instead of "shall," the Minister—I think it is the Minister and not the Lord Chancellor—would then have complete discretion as to whether there should be an appeal or not. The Minister might say: "In spite of the word 'may' occuring here I propose to exercise my discretion so that there shall not be an appeal." It is not that he wishes to do that. But I am not at all sure that it is just as the Lord Chancellor says.
THE MARQUESS OF READING
I rather hope I was not in the House when the Lord Chancellor made the remarks which have just been quoted by the noble Viscount, Lord Hall, and that had I been here I should have taken some exception to them, though that might have been an unduly audacious course. I am very puzzled at the objection to this Amendment. Let us look at how the clause would read if the Amendment were made. It would read:Shall in particular contain provisions…What provisions?provisions enabling appeals from any determination…That is what is wanted—that there shall be provision for the making of appeals and that those appeals shall be:as to whether any or what compensation is payable…in such cases, subject to such conditions—not something which is entirely at the discretion of the Minister in relation to each particular case, but subject to such conditions as shall be laid down by the-Minister actual regulations. It does not seem to me to be in any way fettering that discretion to say at the beginning of the clause that there shall be an appeal but it shall be only in such conditions as the Minister, by other regulations, 779 may hold applicable in particular cases. I cannot, for the moment, grasp the argument that by putting in the mandatory instead of the permissive word we are thereby doing anything to interfere with the discretion which is in the Minister to prescribe by regulations how a particular appeal shall be conducted.
§ VISCOUNT HALL
I thought my case was cast iron. I quoted the Lord Chancellor, and far be it from me to say that the Lord Chancellor's advice was not in accordance with the law. Nor will I go so far as to say that the view of the noble Marquess, Lord Reading, was contrary to the law. If the noble Lord will be so good as to withdraw this Amendment, I will certainly consult with the Lord Chancellor about this matter with a view to seeing if it can be cleared up.
LORD BALFOUR or INCHRYE
I, too, remember the Lord Chancellor's sudden onslaught on myself, which took us all by surprise. We felt that such learned advice must, of course, be correct, and it was only on subsequent reflection that we began to doubt if it was quite so infallible after all. I am only sorry that the Lord Chancellor is not with us now, but I suppose he has other duties to perform. I am grateful to the noble Viscount for saying that he will consult with the noble and learned Viscount the Lord Chancellor, and on that understanding I beg leave to withdraw my Amendment.
§ Amendment, by leave, withdrawn.
LORD BALFOUR OF INCHRYE moved to add to the clause:
( ) Regulations shall be made under this section not later than six months after the date upon which this Act comes into force.
The noble Lord said: The purpose of this Amendment is to ensure that regulations regarding compensation for loss of employment are not unduly delayed. As at present drafted, the Bill lays down no time limit within which regulations must be made under Clause 41. It is likely that immediately after the vesting date the Minister will be preoccupied by many important matters, and it may well be that regulations will be relegated to a secondary place. We have to think of the individual men and women who would be affected by the delay in the issue of regulations, and of the uncertainty that
will exist in their lives and the difficulty they will have in carrying on, not knowing what their future position is going to be. It is to avoid that hardship that we propose six months as a reasonable interval between the date of the Act's coming into force and the making of regulations. It is worth reminding your Lordships that in the case of the Electricity Act, 1947, for which there are similar regulations, although the Act received Royal Assent in August, 1947, and the vesting date was April 1, 1948, regulations were not approved by Parliament until March, 1949—an interval of almost a year. I recall, in case the noble Lord reminds me, that I moved a rather similar Amendment on another nationalisation Bill, and the noble and learned Viscount the Lord Chancellor replied that if we put a time limit on regulations, that might mean that we would have unsatisfactory regulations rushed through. The noble and learned Viscount said that he would prefer good regulations at a longer date ahead than bad regulations in a short time. We do not say that we want bad regulations; we want good regulations in a reasonable time, because of the hardship and difficulty to those affected due to their prolonged uncertainty.
Page 48, line 43, at end insert the said subsection.—(Lord Balfour of Inclzrye.)
I should like to support this Amendment, which your Lordships who have taken part in other nationalisation Bills will recognise as an old friend. It is an old friend of mine, because on the Electricity Regulations I had occasion to ask a question on this particular point after the Bill had been passed. At that time I was told that it was difficult for the Government to get on with the regulations, because of the number of associations they had to consult and the shortage of draftsmen. Now that the Government have temporarily stopped nationalising industries—until the next Election!—there will be far more draftsmen and, by the same token, if the Government get down to making regulations, I do not think we need necessarily have bad regulations because of the imposition of a time limit. I think it is quite possible to do this in six months, and it is of the greatest importance to the people in this industry that the regulations should appear at the earliest pos- 781 sible moment. Although this is an old "chestnut," I hope the noble Viscount will be prepared to accept the Amendment.
§ VISCOUNT HALL
I am afraid I can do no more than give an assurance that the regulations will be made as soon as possible. These regulations will have to be drafted in circumstances in which officers of 200 privately-owned companies may suffer loss of employment or loss of emolument as a result of nationalisation; and it will take some time for the Government, in conjunction with the Corporation, to find out what conditions will have to be taken into account in drafting these regulations. I very much doubt whether the information could be obtained before the companies had been transferred, which would be some months after the passing of the Act. In some cases transfer may be postponed beyond the general date of transfer. I think it would be unreasonable to put on the Corporation the task of working against a time limit, as is suggested in the Amendment. The Corporation and the companies will be heavily engaged with important matters, and the draft regulations will have to be discussed not only with trade unions but with other representative bodies. To obtain the necessary details and arrange this matter will probably mean a period very much longer than the six months suggested.
I dislike delay very much. I know that uncertainty causes a great deal of anxiety. In the whole of my period in industry the one thing which, more than anything else, led to discontent was delay in coming to a decision. But I do not think that a period beyond six months could be regarded as unreasonable in relation to the framing of regulations, because at the present time there is nothing in the industry to go on, and it will mean a completely new set of regulations. I doubt very much whether the regulations of other nationalised industries could be taken as a model, in view of the fact that so many separate companies will be brought into this scheme. For these reasons I ask the noble Lord not to press this Amendment. Noble Lords can be assured that all the pressure which can be brought to bear will be brought to hear, both on the Minister and on the Corporation, to see that when this Act is implemented the regulations will be brought in with every possible speed.
§ THE EARL OF DUDLEY
I should like to ask the noble Viscount a question. Three or four of the Amendments which we have moved were refused on the grounds that they would be dealt with in the regulations. This Amendment tries to deal with the dislocations which will happen to various officers under this reorganisation. What is to happen to these officers who lose their emoluments, either through redundancy or through having to take different work at lower pay, in the period between the taking over by the Corporation of the companies under the Second Sehedule and the issuing of regulations? This period may be a year. Who is to pay the difference in their emoluments? Some of these officers may get nothing at all, and they will be waiting for the regulations to be framed and passed before they can get justice. I think the noble Viscount should answer that.
§ VISCOUNT HALL
I will answer the noble Earl by asking him how we are to know that these things will happen. He is talking in purely hypothetical terms. Nothing is more likely to lead to uncertainty and anxiety than the kind of speech made by the noble Earl. The Government are most anxious that existing conditions in this industry should continue for some time. There will be no interference with the directors, the managers or the technical staff. We do not anticipate that the changes to which the noble Earl referred are likely to take place—indeed, I will go so far as to say that we are very anxious that they should not take place.
§ VISCOUNT SWINTON
The noble Viscount, Lord Hall, has said something which has greatly relieved me. I am quite certain that my noble friend Lord Dudley did not mean to create uncertainty. I was anxious in my own mind as to what would happen to a man who was reduced or dismissed before the regulations were mad. I entirely agree with the Minister, in that I do not think he could possibly give an undertaking to have these regulations ready within six months of the Act's coining into force. I think they will be the most complicated regulations that have ever been drafted. I am sure that when they come up for debate here and in another place all sorts of points will crop up that have never been thought of. In 783 fact, they will probably have to be laid in draft as a White Paper, in order that there may be a full debate in both Houses so that points which have been overlooked can be taken back, in order to avoid the trouble of praying against a regulation because three or four things are wrong with it and the whole thing going by the board.
What is a perfectly genuine case is that when the Act comes into force (if it does), the Corporation will be set up and, presumably, will immediately get busy on regulations. I suppose plans will go forward: there will be discussions between the Corporation and the bodies which are to vest in it—discussions as to reorganisation and so on. It may well be that, although the companies have not vested, certain arrangements will be made about which the Corporation will be able to give directions as soon as the undertakings vest. The noble Viscount, Lord Hall, and the Minister have talked about the economies which are to be effected. Effecting economies generally means reducing staff. We all agree that these people should be properly treated. I am assuming that the regulations will be all we want them to be when they come into being. What I want to know is, if people are dismissed or reduced before the regulations come into effect what power will the Corporation have to make payments? I am not sure whether the payment of compensation is to be an obligation on the Corporation or an obligation on each individual company; I think it is the Corporation.
§ VISCOUNT SWINTON
It may be one or the other. Assuming that it is the company, would a company which is not yet vested but which has agreed to do something have the power to say to a man: "I will pay you something when I get rid of you"? I should have thought that was exactly the sort of contract about which we felt a difficulty last time; that was why we were so anxious to get a clause which said: "Go on doing your day-to-day business with full discretion until the regulations come into force." I am not sure what legal authority either the individual companies or the Corporation would have to make a man an ex gratia payment or a payment on account. 784 Yet he should be paid. Possibly the noble Viscount intended to say—this was rather what his speech implied—that nobody would be dismissed as redundant from any of the companies until the regulations were published. I know that it is difficult in these discussions to guard oneself completely; I am sure that from time to time I say things which are wrong. But did the noble Viscount mean that there will be no dismissals and no depreciation in an employee's position until the regulations are out? If that is not so, will the companies or the Corporation have the right to pay a man something reasonable on account until the regulations are published which lay down what is to be paid?
§ VISCOUNT HALL
It would be impossible for me to give any guarantee on that, but I should assume that any wise Corporation—and we hope that this Corporation, when it functions, will be a wise one—will interfere as little as possible, at any rate for some time. But let us assume that there are difficulties such as those which have been mentioned. I have no doubt that the directors, or indeed the general managers, of companies of this kind have a fixed agreement; quite a number of them have an agreement for a period, whether it is a five-year agreement or a ten-year agreement. If the men have no agreement, then their condition is not much worse than it is at present, for they can now be dismissed—I am not suggesting that they are dismissed. Obviously, there are a number of very old officials in the iron and steel industry, as there are in most other industries. I have no doubt that the Corporation will want to foster the friendliest relations with the staffs, from the directors down to the office boys. Let us assume that there are reductions in status and in emoluments; and even that certain persons are dismissed. There is then nothing to prevent the company from making a reasonable payment on account in cases of that kind. I think that will go some way to meet the situation. I know that it is the intention of the Government that, until the Corporation gets into full swing and until they can see that co-ordination is necessary, in the interests of the industry, the industry will continue largely as it is at present.
§ LORD BALFOUR OF INCHRYE
The noble Viscount, Lord Hall, has made a 785 very important explanatory statement in saying that the companies have power, in cases like those cited by my noble friend Lord Swinton, to make payment on account. That reassures us to a considerable degree. I agree with what was said by my noble friend that it is not unreasonable that a period beyond six months should be expected. This Amendment suggested six months in order that we might clarify the situation. I sincerely hope that the Minister's intentions will be fulfilled by the regulations being issued at the earliest possible time. If any uncertainty was caused, with great respect to the noble Viscount, Lord Hall, it was caused in his first speech, when he was, as it were, excusing the time that will be taken. The noble Viscount told us, "The Corporation will be concerned with very important matters." Of course they will. But in my view, there are few matters more important than human relationships in industry. I hope that the personnel question will be ranked amongst those very important matters which will have the earliest consideration. However, with the assurance which the noble Viscount has given in regard to the rights of the companies to make payments on account, I beg leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Clause 41 agreed to.
§ Clause 42 agreed to.
§ Clause 43:
§ Establishment of Iron and Steel Arbitration Tribunal
§ (7) The arbitration tribunal may, at any stage in any proceedings before them, refer to a person or persons appointed by them for the purpose, any question arising in the proceedings, for inquiry and report, and the report of any such person or persons may be adopted wholly or partly by the tribunal and, if so adopted, may be incorporated in an order of the tribunal.
§ 4.30 p.m.
§ LORD CLYDESMUIR moved to omit subsection (7). The noble Lord said: In case your Lordships should fear that by moving to leave out an important subsection of the Bill I am going to interrupt the atmosphere of sweet reasonableness which has descended upon the Committee, I would like to explain at once that my Amendment is of an exploratory character. We are dealing with the arbitration tribunal, and I hope to elicit from noble 786 Lords opposite some information about what is intended by the powers of delegation which are given to this tribunal. I want to obtain from the Government a statement as to the class of matter which it is intended shall be delegated under this subsection and, secondly, I should like from them a confirmation of the assurance given in another place by the Solicitor-General for Scotland or, behalf of the Government, that the parties to arbitration will, in fact, be given an opportunity of considering a report made by a person to whom the tribunal delegates matters in the terms of the clause.
§ This subsection empowers the arbitration tribunal to refer any question for inquiry and report to a person selected by them, and I find it difficult to understand why it is really necessary that the tribunal should have such wide powers. After all, this is an important tribunal, and—if the scheme is to go forward—we approve of its appointment. It is to consist of an experienced lawyer, an experienced business man and an experienced financier—a very powerful triple combination. Now parties to arbitration will no doubt call expert witnesses on difficult technical questions, and it seems that the tribunal should be able to decide questions on the evidence laid before them, however technical. I cannot see why it should require to refer questions to other experts, except in rare cases where an accurate ascertainment of facts is necessary. I feel that in some mixed questions of law and fact, and of course in questions of law, it would be very unfortunate if the tribunal had to delegate powers. Surely this is precisely the purpose for which the judgment of these three men is required. My reason for moving this Amendment is to obtain from noble Lords opposite some indication of what is in the mind of the Government by delegating such wide powers "any question" are the words used.
I turn now to the assurance given by the Solicitor-General for Scotland—and I take some comfort from the fact that it was that gentleman, a lawyer of repute, who gave the assurance. The actual terms of the assurance given in the House of Commons Standing Committee were as follows:
…what is contemplated here is that very much the same procedure will take place as takes place before an official referee. The parties will have a note of the matters sub-
mitted to the person by the arbitration tribunal; they will have an opportunity to be heard before the person to whom the remit has been made; and they will be told the decision of the person to whom the remit has been made.
That is as far as the Solicitor-General was able to go. I hope the noble Lord opposite will be able to satisfy me on this point. I beg to move.
Page 50, line 36, leave out subsection (7).—(Lord Clydesmuir.)
§ THE EARL OF DUDLEY
I beg to support the Amendment moved by my noble friend Lord Clydesmuir. This subsection, as it stands at present, is very vague and unsatisfactory, and we should have more information with regard to it. Subsection (4) of Clause 44, which refers to the procedure and the rules which will be made by the tribunal and which will receive the approval of the Lord Chancellor, is also very vague. We would like to hear something of what is envisaged in regard to that matter and when these rules are likely to be published.
I agree with the noble Lord who moved this Amendment that it does not seem necessary that there should be any delegation at all by the tribunal, except in very rare cases where technical details of fact have to be ascertained; and in no case should the tribunal divest themselves of their responsibility for exercising their powers of discretion and judgment. If they are going to delegate all their powers widely, as they can do under this subsection, to all sorts of extraneous persons to do their job for them, then there is no object in appointing the tribunal at all, and the whole thing becomes extremely unsatisfactory. Mixed questions of law and fact, and all questions of law, should be decided by the tribunal, and by the tribunal alone.
Reference has already been made to High Court referees, but delegations there are made according to very clearly defined rules and proceedings. We want to know whether the rules and proceedings which will regulate this tribunal will be equally clear and equally binding. For example, one rule of the Supreme Court says:There shall be a right of appeal from any finding, decision, order or direction, and from any judgment entered or signed by leave, order or direction of a special referee in any 788 action, cause or matter or question or issue referred to him for trial or decision.Rule 2 of that order says:In the case of a finding, decision, order direction or judgment arrived at, made, given, directed or entered on the trial or hearing of any action, cause or matter or question or issue or of any assessment or award of damages the appeal shall lie in the Chancery Division to the judge in court; in the King's Bench Division to a divisional court; and in the Probate, Divorce and Admiralty Division, to a divisional court of that division.The laying down of rules of that kind makes the matter quite clear, and we want to know whether there will be the same rules in this case. Of course, the official and special referees to whom the High Court refer matters are, as the noble Lord has just said, people with very high qualifications. We have no assurance that the referees to whom actions may be referred by this tribunal will be persons of high qualifications. We do not know who they are going to be.
Then what about the right to appeal? The tribunal can accept in part or in toto any of the recommendations made by the referees, and the Solicitor-General for Scotland in another place told us that the parties will be informed who the referees are and will be given a chance of being heard by them. As I understand it, there is only the right of appeal from the decision of the tribunal under certain clauses. As the Bill is drafted at present, I do not think the rights of appeal are wide enough. I hope that the noble Lord who replies will give us some explanation in regard to that matter. As the noble Lord has said, this is an exploratory Amendment; we want to hear as fully as possible what the duties are to be.
§ LORD LUCAS OF CHILWORTH
I felt sure that the noble Lord, Lord Clydesmuir, was not going to disturb the equanimity with which the proceedings have gone so far. I think I can give him assurances on all the points on which he wants them. As the noble Lord has rightly said, the arbitration tribunal is set up, in the words of subsection (1) of Clause 43:For the purpose of determining any question or dispute which under any provision of this Act or any regulations made thereunder is expressly required to be determined by 'arbitration under this Act,'….One-third of the clauses and Schedules of this Bill make reference to matters which can go to arbitration. The sub- 789 section which the noble Lord wants to leave out is the one which permits that the arbitration tribunal may—it is purely permissive:at any stage in any proceedings before them, refer to a person or persons appointed by them for the purpose, any question arising in the proceedings, for inquiry and report, and the report of any such person or persons may be adopted wholly or partly by the tribunal and, if so adopted, may be incorporated in an order of the tribunal.The questions which will have to go through this tribunal are as wide as the Bill itself; and although the tribunal, as is laid down here, will be composed of eminent persons appointed by the Lord Chancellor, is it right to deny them access to any external advice which they may require over all the field of activity which their inquiries will cover? There is nothing in this clause, and in fact nothing in this Bill, which makes it obligatory for the tribunal to accept any report made by the experts; and nothing in this Bill relieves the tribunal of decision. The tribunal have to take full responsibility for their decision. They may ask for expert investigation in matters in which they think fit.
The noble Lord then asked me the classes of matter which would be the field of the tribunal. I think I have answered that—as wide as this Bill. I will not read out all the classes, but I have the list here. It comprises, as I have said, about one-third of the clauses and Schedules of the Bill. The noble Lord asked me whether I would confirm that the statement made in another place by the Solicitor-General for Scotland is still the aim and object of the Government, and whether it will be incorporated in the rules made for the arbitration tribunal. I hope the noble Lord will not get into trouble for questioning what the Solicitor-General for Scotland said; I always thought that what was said as from one Scot to another was as good as Holy Writ. But if the noble Lord wants it confirmed, I can assure him that what the Solicitor-General for Scotland said in another place is quite correct. The arbitration tribunal will work, as the noble Earl, Lord Dudley, has said, under the rules made under subsection (4) of Clause 44, and will follow exactly the same pattern as the rules of the Supreme Court. They will take care of all the provisions which the noble Earl has in mind. The evidence of anyone to 790 whom the tribunal may have delegated any inquiry can be challenged. The noble Lord may rest assured that that is the procedure, and it is done for the sake of convenience. I have no doubt that we shall have the opportunity of seeing the regulations when they are made by the Lord Chancellor. With that explanation, I hope the noble Lord will think fit to withdraw his Amendment.
§ LORD LUCAS OF CHILWORTH
That is another case. Subsection (3) of Clause 44 says:The arbitration tribunal may, and if so ordered by the Court of Appeal shall, state in the form of a special case …and so on. So there is an appeal. I cannot say whether that applies to every case or only to selected cases.
§ LORD LUCAS OF CHILWORTH
I will ascertain the exact grounds for appeal from the arbitration tribunal to the Court of Appeal, and I will let the noble Earl know.
THE MARQUESS OF READING
I appreciate what the noble Lord has said with regard to the scope of this subsection, and having had some experience of not very dissimilar tribunals in connection with another nationalised industry I should like to make one point. This is a valuable power to have in the Bill, but it ought to apply purely to questions of fact. It is undesirable that members of the tribunal should be able to run outside and get information from all and sundry on questions of law. I suggest for the noble Lord's consideration that in line 38 the wording might be… any question other than a question of law arising in the proceedings …I suggest that way rather than putting in for instance… any question of fact …because you might get some matter coming perhaps into a scientific category, which may or may not be wholly a question of fact; it may be a question of 791 opinion as between various authorities. Therefore I suggest it might be wise to put the matter in the form I have just suggested, or in this form… any question not being a question of law …".and otherwise leave the field clear. The distinction in regard to questions of law is made in the references to appeals in Clause 44.
§ LORD LUCAS OF CHILWORTH
As usual, the noble Marquess is very helpful. I venture with much diffidence into this field, which is not a layman's territory, but I think I am right in saying that the Solicitor-General for Scotland argued in another place on precisely the same point: that it was impossible always to dissociate law from fact, and that as delegation was advisable there should not be any limitation upon that particular point. It has been fully considered, and it was felt that to lay down any hard and fast rule would only handicap the tribunal.
THE MARQUESS OF READING
I am a little startled, I confess. I think the noble Lord must have been taken by surprise. May I quote subsection (3) of Clause 44 a little further than did the noble Lord? It says:The arbitration tribunal may, and if so ordered by the Court of Appeal shall, state in the form of a special case for determination by the Court of Appeal any question of law"—law only, the Committee will note—which may arise before them, and an appeal shall lie to the Court of Appeal on any question of law or fact from any determination or order of the arbitration tribunal …It would seem as if those who drafted the Bill thought there was no insurmountable difficulty in deciding whether or not an appeal lay on a question of law or a question of fact. If a question of law, it is admissible; if a question of fact, it is not.
§ LORD LUCAS OF CHILWORTH
I was quoting only the argument advanced by the Solicitor-General for Scotland in another place.
§ LORD LUCAS OF CHILWORTH
The noble Marquess gives his opinion of the 792 Solicitor-General for Scotland, which is not quite so high as that of the noble Lord, Lord Clydesmuir, who asked whether the Government accepted what the Solicitor-General for Scotland had said. But I will convey to the appropriate quarter the observations made by the noble Marquess and see what the legal advisers to the Government think of the point he raises.
Rising in defence of my countryman, the Solicitor-General for Scotland, I feel that without hearing the whole of his opinion it is difficult to judge exactly.
May I ask this question of the noble Lord? My noble friends agree with me that if I withdraw this Amendment now and the noble Lord opposite will consider what the noble Marquess has said, we will keep the matter open and put down on Report stage an Amendment incorporating the words suggested. We may then come to a decision. From the kindly attitude adopted by the noble Lord, in spite of the dispute about the exact legal phrase, I take it that he is well-disposed towards the principle here involved. I beg leave to withdraw my Amendment.
§ Amendment, by leave, withdrawn.
§ Clause 43 agreed to.
§ Clause 44:
§ Procedure and enforcement of orders of arbitration tribunal
§ (3) The arbitration tribunal may, and if so ordered by the Court of Appeal shall, state in the form of a special case for determination by the Court of Appeal any question of law which may arise before them, and an appeal shall lie to the Court of Appeal on any question of law or fact from any determination or order of the arbitration tribunal on a claim under section eighteen of this Act against the directors of a company or on an application under section twenty-two, section twenty-four or section twenty-five of this Act in respect of any transaction.
§ LORD CLYDESMUIR moved, in subsection (3) after "application" to insert "or claim." The noble Lord said: This Amendment also deals with the arbitration tribunal. I hope that again the sweet spirit that pervades the Committee will enable us to reach an understanding 793 here, because I think we are not far apart. The purpose of this Amendment is to ensure that a right of appeal on a question of fact is allowed against the determination of a claim outstanding in respect of a transaction under Clause 25 (5). Your Lordships will recollect that that clause deals with transactions causing dissipation of assets. There is some back history to this, in which again the Solicitor-General for Scotland is interested, as he made some statements in another place on the subject. The purpose of moving my Amendment, which I will not expand in detail, because I think the noble Lord can save our time by giving us his opinion on it, is to ascertain whether it is clear that on questions of fact an appeal lies against the determination of a claim. If not, it would seem that the words of my Amendment should be inserted. I suggest to your Lordships that in any case it would do no harm to put in the words that I have here suggested to make the thing doubly secure. I will not enlarge further upon this Amendment unless your Lordships wish me to do so at a later stage. I beg to move.
Page 51, line 20, after ("application") insert ("or claim").—(Lord Clydesmuir.)
§ LORD LUCAS OF CHILWORTH
I am happy to say that the noble Lord has been so persuasive that I am going to accept not only this Amendment but the next one as well. What he has stated is quite right. There is an appeal against law and fact, exactly as he has said, and we see no reason why we should not make it perfectly plain by accepting both these Amendments standing in his name.
I thank the noble Lord for doing so. To avoid speaking twice, I should like now to thank the noble Lord also for rendering Scotland a service by accepting the next Amendment, which is a Scottish application to the same principle. In the name of Scotland, I thank him.
§ On Question, Amendment agreed to.794
Page 52, line 2, after ("application") insert ("or claim").—(Lord Clydesmuir.)
§ On Question, Amendment agreed to.
§ Clause 44, as amended, agreed to.
§ Clauses 45 to 47 agreed to.
§ 4.56 p.m.
§ LORD TEYNHAM moved, after Clause 47 to insert the following new clause:
§ Restoration of land
§ ". Each publicly-owned company shall where economically practicable restore land from which iron ore has been extracted by it by open cast working to such condition as to be reasonably fit for agriculture or for afforestation or for some other beneficial use or as near as may be to the condition in which it was before the extraction took place."
§ The noble Lord said: The object of this Amendment is one which I think will receive support from all sides of the Committee. I am sure that any of your Lordships who has seen the devastated areas in the Midlands and in many other parts of the country, as I have seen them, will realise the importance of this Amendment. I think it is true to say that until comparatively recent times iron ore workings were confined to the vicinity of the outcrops, but during the late war we had difficulty in importing iron ore and we had greatly to step up home production. That great increase in production is now being continued, and rightly so. It is necessary that we should continue it because the iron ore is comparatively easily worked. This great increase in production has had the effect of laying waste large areas of land which we can ill afford to lose at the present time. I think it is true to say that we have only half an acre of agricultural land per head of population. It is interesting to recall that in open-cast mining operations carried out many years ago (and indeed not so many years ago) the surface was always replaced and restored for agricultural purposes.
§ But what is the position to-day? It is true that a proportion of the areas quarried has in fact been restored to agriculture, but there are many thousands of acres of land which are still derelict, and day by day this destruction is increasing. I understand that His Majesty's Government have had certain Committees sitting on this matter—in fact, a Committee sat as recently as 1946—but certainly no legislative action has yet taken place to deal with the problem of restoration. We 795 feel that this is an opportunity when something might be done and perhaps a statutory obligation put into the Bill to ensure that the publicly-owned companies will in fact restore the land where possible. This actually can be done, because in one case I know of a mining company in the Midlands which is developing about 1,500 acres of land, and the over-burden is 70 to 80 feet deep. They have undertaken to make complete restoration in this case. It can be done, by means of modern equipment.
§ A somewhat similar Amendment was moved in another place and was supported by members of all Parties, but it was rejected by the Minister for a reason which I find it difficult to appreciate. It was argued by the Minister that there were other forms of mining, some of which were being followed by companies outside the nationalisation fold. It is true that other mining concerns are also involved, but only to a very small degree. The two biggest problems involved in relation to the restoration of land, however, arise from iron ore and from opencast coal mining; and in the case of opencast coal mining I understand that an obligation to restore the land has now been included in all the contracts. That, of course, is fair and is being worked by the State. I think there should be similar conditions with regard to contracts for the mining of iron ore. A further argument raised by the Minister was that the right approach to the problem was through the Town and Country Planning Act, and that the Minister of Town and Country Planning had in fact himself given an assurance that he intended to see that effective conditions would be imposed. That is all very well, but I maintain that the devastation of agricultural land is so serious at the present time that something more than an assurance is now necessary, and the acceptance of this Amendment will assist the Minister in making good this assurance. I beg to move.
After Clause 47 insert the said new clause.—(Lord Teynham.)
§ THE EARL OF DUDLEY
I beg to support the Amendment which has been so well moved by my noble friend, Lord Teynham. This, at any rate, is an Amendment which we can discuss without any heat whatever. I know we are 796 all agreed in regard to the principle which underlies the Amendment and the only problem is to carry it out in the most desirable way. The Minister said in another place that the main responsibility in regard to this matter lay with the Minister of Town and Country Planning. But he did say:I, too, will take all steps in my power—and they are quite considerable—to ensure that the Corporation and the publicly-owned companies carry out to the full their public obligations in this matter.This Amendment has been very carefully framed in order to assist him in every possible way in ensuring that the Corporation and publicly-owned companies do not shirk this obligation in any way. We feel that in this respect there should be a statutory duty imposed on the companies rather than a general duty imposed on the Corporation.
I do not want to introduce any controversial points but the only way in which we may differ from noble Lords opposite is that they think the Corporation is going to be so perfect that it will never err in any direction. We do not share that feeling. We believe it will be just as subject to mistakes and greedy fingers as private owners have been in the past. But there is no doubt that the Corporation will have a very direct responsibility to the public in this respect. They must not leave dirty scars all over the country. Private owners may have done it in the past. I remember the late Earl Lloyd George discussing many years ago the state of the Black Country. He said:As you drive through the Black Country you can see once beautiful countryside destroyed by the scars made by the fingers of greed.The fingers of my ancestors may have been partly responsible for some of those scars, but that is no reason why the Corporation should have the same guilt in the future. Indeed, there may have been some excuse for my ancestors in the past, because there did not exist at that time the machinery that exists to-day for restoring the countryside to its original beauty.
As noble Lords know, two Committees have been set up to inquire into this particular problem—the Kennet Committee and the Waters Committee. The Kennet Committee, in its Report published in 1939, said this: 797Considerable developments have been made in the design and use of earth-moving machinery and we do not think that there should now be any insuperable difficulty in undertaking the preparation of large areas of worked-out land either for afforestation or agricultural purposes or, where required, for constructional development, after the war.The Report also said:Legislation should be passed, imposing an obligation on all those who derive benefit from the working of land for minerals, to restore that land for agricultural or afforestation or other purposes (as may be directed by an appropriate authority) within a short specified time after the land has been worked.Then the Waters Report, which was published as recently as 1944, said:
Some of the Committee may have seen a most interesting memorandum which has been issued by the National Council of Associated Iron Ore Producers on the working of ironstone all over the country. It is extremely interesting and the illustrations show exactly how this top spit—I believe that is the right word—can be removed, put aside and reimposed after the ironstone has been extracted, with practically no damage at all to the original top surface and at remarkably; low cost. I have heard that the cost of removing and replacing the top layer of soil is as low as 3s. per ton, which would mean a total expense of something under £400,000 a year for the annual area of ironstone to be worked. That, surely, is a very low burden of expenditure and the work should be carried out. I hope very much that the Government will either accept this Amendment or introduce something into the Bill which will ensure that this very necessary work is carried out by the Corporation in the future.
- "(1) in order to ensure the most efficient and economic use of the necessary machinery, restoration of the surface must be considered as a part of the operation of extracting the ironstone and not as something divorced from that, requiring subsequent and separate treatment;
- (2) the developments of excavating machinery since 1945, particularly of the walking dragline, are such that a great deal more restoration is possible, concurrently with the excavation of the ironstone, than is now effected."
The noble Lord, Lord Teynham, felt certain that support from all sides of the Committee would be forthcoming, and certainly it is forthcoming for his objective, which was very clearly stated by the noble Lord and by 798 the noble Earl, Lord Dudley. The noble Earl said that this is a matter which, in principle, can be discussed without any heat. I do not know that to-day it is easy to do anything without any heat! I am not quite sure that that is feasible in the circumstances. But perhaps it should be possible to discuss this matter without any humanly generated heat. I have been in touch with my right honourable friend the Minister, and I can assure the Committee that he fully sympathises with the desirability of the publicly-owned companies taking all appropriate steps to secure proper restoration of land from which iron ore is extracted. He recognises that the Corporation should play their part in assisting the publicly-owned companies to carry out their responsibility in this matter, and he is quite prepared to use his influence with the Corporation, should the necessity to do so arise. Therefore, as I say, in objective we are at one. But, as was explained in another place, we do take a view that it is inappropriate and unnecessary to include the proposed clause in the Iron and Steel Bill. I will come in a moment to the feeling we have about it, and I will indicate what we might do to meet noble Lords opposite if they wish to press the matter. But certainly that is our own basic view: that in fact it is unnecssary to include the clause here.
The control of land restoration is a function of the Minister of Town and Country Planning, and I can certainly assure the Committee that under the Town and Country Planning Act he has already adequate powers. He can attach conditions about land restoration to the permission given under that Act for the development of land for iron ore working, and he is satisfied that those conditions could be far more satisfactorily laid down by him (that is, the Minister of Town and Country Planning), dealing as they must with these different cases, than they could be in some general Amendment of the kind proposed by the noble Lords opposite.
I would say, however, that noble Lords have obviously given a great deal of thought to this, and may wish to discuss the matter further; and whilst I do not at this stage want to commit the Government in any particular direction I gladly agree to discussions before the next stage. We might consider a provision requiring 799 the Corporation to take appropriate action to secure the compliance by the publicly-owned companies with any conditions imposed under the Town and Country Planning Act. That might be one way of dealing with it, but I must say that we start with the view that it is not necessary to have a statutory provision in this Bill. We realise that the noble Lords opposite have given consideration to this matter, and that widespread public attention has been drawn to it; and, as I say, we shall be glad to have a discussion on it.
§ VISCOUNT SWINTON
Whilst we agree that a discussion may be advisable, I would say that I think noble Lords on this side of the House (and I do not think it is confined to this side of the House) feel most strongly that there should be some provision of this nature in the Bill. The facilities are there now, and the iron ore companies, since the new technique was known, have had an extraordinarily good record in this matter. I myself had no idea, until I went into it, how good it was, and, happily, at least two-thirds of the ground has been restored to agriculture.
I think that there should most certainly be an obligation on the companies to restore this ground—whether it is a national Corporation or a private undertaking makes not the least difference. I do not think there is any question that we can trust a nationalised company to do this, but I would say that everybody ought to do it. I do not think we should get anywhere by leaving this to town and country planning, which has not a very commendable sound in this House. The Town and Country Planning Act is a good way of stopping things being done, and I do not think the idea that it would be a good way of getting things done would greatly appeal to your Lordships.
This has, moreover, nothing to do with town and country planning; this is not a case of landscape gardening. What we want is to have this land restored so that we can grow crops upon it. Quite honestly—and I want to speak bluntly about this—I have every belief that the Corporation, if it ever comes into existtence, will have a good intention in this matter but I have not the least faith in 800 the Ministry of Town and Country Planning. That they have grandiose schemes is true, but they are the worst enemies of agriculture in this country. I was present at the debate (which I expect the noble Lord attended: the Leader of the House was there because I saw him listening, with a barely concealed sympathy for what was being said, because he is a very good farmer) when case after case was advanced where the Minister of Town and Country Planning had made plans and regulations. One heard about schools—every school to be approached by an avenue of cypresses, as if it was the graveyard of Caesar—and the only result of these activities in every case would be to reduce the amount of agricultural land available for crops.
I hope that we come to an arrangement about this, but I feel sure that the provision ought to go in the Bill. It has to be a reasonable provision and I think this one is, because we condition it economically. The argument was made against it that there are many other things of the same kind to be dealt with; but that is not so, because the Government are taking over practically all the ironstone mining, and the only other case applicable is the open-cast coal mining, which again is in Government hands. I feel certain something ought to go into the Bill and I am quite sure that my noble friends will be glad to discuss it. The First Lord of the Admiralty said he did not want us to go into discussions under misapprehensions of what we could do. But we shall be very willing to discuss the terms of a clause which imposes an obligation on the Corporation. Quite frankly, if the approach is to be that this is to be left to the Minister of Town and Country Planning under the "Town and Country Planning (Frustration of Development) Act," or whatever it is, then obviously I do not think we could make that approach at all.
The noble Viscount has passed some severe strictures on a Ministry which has not been under much fire in the course of this Bill, and for a particularly good reason—namely, that the Ministry of Town and Country Planning hardly seems relevant to our discussion. I cannot accept those observations, but I accept a great deal else of what has been said and if the noble 801 Lord is agreeable to discussions so are we. Let us go into them with a good heart and see what we can agree.
In view of the assurances that have been given by the noble Lord, I do not propose to press this matter.
§ Amendment, by leave, withdrawn.
§ Clause 48 agreed to.
§ Clause 49 agreed to.
§ Clause 50 [Regulations]:
§ VISCOUNT SWINTON
This Amendment is consequential upon the new clause which we passed after Clause 1, and the Amendments which the House made in Clause 2. I think, therefore, that the noble Lord will agree that it is purely a drafting Amendment and words ought to be inserted in the form in which they now stand on the Order Paper. I beg to move.
Page 54, line 6, after ("by") insert ("section (Powers of subsidiaries of the Corporation, section two and").—(Viscount Swinton.)
I formally accept the Amendment as consequential, with the reservation, of course, that it will come out if the other Amendment comes out.
§ On Question, Amendment agreed to.
§ Clause 50, as amended, agreed to.
§ Clause 51:
§ Duty to furnish information
51.—(1) It shall be the duty of every company specified in the Third Schedule to this Act, and every company which on the twenty-ninth day of October, nineteen hundred and forty-eight, was a subsidiary of such a company, and every person in whom are vested any property or rights which were on or after the said day property or rights of any company so specified or any subsidiary thereof or which are derived from such property or rights, and every other person who carries on any of the activities specified in the first column of the Second Schedule to this Act—
(a) to produce, to any person authorised by the Minister on production by that person, if so required, of a duly authenticated document showing his authority, such books of account, records and documents, to supply copies of and extracts from such books, records and documents, and to furnish such other information, as may reasonably be re-
quired by the Minister or the Corporation for the purposes of the provisions of this Act; and
Provided that this subsection shall not apply to any company after it has come into public ownership, and shall cease to have effect on the expiration of a period of twelve months from the general date of transfer, except so far as it applies for the purposes of Part III of this Act.
§ 5.19 p.m.
§ LORD TEYNHAM moved, in subsection (1) (a) to leave out "or the Corporation." The noble Lord said: For the convenience of your Lordships I would like to suggest that this Amendment, and the next two Amendments, to lines 33 and 41, should be taken together. The real object of this Amendment is to confine the obligation to supply information under this clause to such information as may reasonably be required by the Minister for the purposes of Part II and Part III of this Bill. It is clear that the powers of the Minister and the Corporation to obtain information are very wide indeed and will cover all those units which do no come within the field of nationalisation. It is true that the Corporation before the vesting date will, of course, need certain information from the companies to be taken over. But there appears to be no reason why they should require such information from those units outside the field of nationalisation.
§ Let us suppose that the Corporation do require such information. They will be free to come to the Minister and make their case, and he can authorise his representative to obtain the information. We feel that it should be the duty of the-Minister to decide if the information required is really necessary. It would surely be wrong for the Corporation, however inadvertently, to obtain trade secrets or other such information froth its competitors.
§ The third Amendment included in the group—that to line 41—limits the information which units outside the field of nationalisation would be obliged to furnish to information showing the extent and amount of the production of the products of the activities specified in the first column of the Second Schedule to the Bill. This information will allow the Minister to determine whether those units outside the field of nationalisation are or are not infringing the terms of their 803 licences. The Minister must be empowered to demand the information which will enable necessary arrangements to be made in accordance with Part II and Part III of the Bill, but I suggest that there is no reason why any further information should be required. I beg to move the first Amendment.
Page 54, line 32, leave out ("or the Corporation.")—(Lord Teynham.)
I would like to support the three Amendments which my noble friend is moving. We have heard a good deal, during discussions on this Bill, about the Government's wish for fair competition between activities carried out by the Corporation and its subsidiary companies and those of the companies still operating under free enterprise. As the clause now under consideration stands, it would be possible for the Corporation and its companies to find out anything they wanted to know about their free competitors; and, frankly, with the best will in the world. I find it difficult to call that fair competition. It seems to me that such an idea of fair competition is a complete fallacy. To one particular point which really underlies the third Amendment I would like to draw attention now. In this particular Amendment we are attempting to confine the information to that showing the extent and amount of the production of the various products of the activities specified in the first column of the Second Schedule to the Bill. If that is accepted, well and good. But, as the Bill now stands, it will be possible for the Corporation to seek information about all sorts of matters—financial matters, as regards costs, margins and so forth. It would seem to me to be completely wrong for the Corporation to ask for that. I can imagine that it might be an argument on the part of the Minister that he wanted the information in connection with the question of controlling prices. But I claim that we have already met that point by introducing into this Bill, at an earlier stage, provision for the Prices Board. In the clause for establishing that body there is full scope for enabling all the information on all relevant financial matters that they could possibly need for the matter of price control to be fur- 804 nished to the Prices Board. What we are seeking to restrict this clause to, seems to me to be adequate for any reasonable purpose that the Minister might want.
§ LORD MORRISON
I am obliged to the noble Lords for taking these three Amendments together. With their permission I would like to deal with the third one first. It is an Amendment which I am afraid I am not able to accept. It seeks to limit information obtainable under Clause 51, as the noble Lord said (except in the case of Third Schedule companies and their subsidiaries), to information showing the extent and amount of production from Second Schedule activities. The reason we cannot accept that limitation is that it may be necessary to obtain information other than that to which the Amendment refers. This may well have been overlooked by the noble Lords. For example, under Clause 23, there are powers to recover any assets (whether or not related to Second Schedule activities) which were, at the date of the publication of the Bill, in the possession of a Third Schedule company and which have subsequently passed into the possession of another company, person or partnership. Similarly, before exercising his powers under Clause 23, the Minister may find it necessary to secure information from the person to whom the assets have been, or appear to have been, transferred. Clause 22 also prohibits the transfer of rights in any works or part of any works which has been used by a Third Schedule company for carrying on Second Schedule activities, but if any transfer were carried out in contravention of this clause, it might relate to a part of a works—for example, a power house, which was not capable of producing Second Schedule products, and, therefore, under the Amendment the Minister would not have powers to obtain information from the person to whom the transfer had been made. He might need to have such information in connection with the operation of Clause 22.
May I suggest that the general safeguard is that under Clause 51 the Minister can demand only information which isreasonably required … for the purposes of the provisions of this Act.I would also add that the powers to obtain information on the matters I have 805 mentioned are already limited by the clause, as drafted, to a period of twelve months following the general date of transfer. After that, the Clause 51 powers will exist only for the purposes of Part III of the Act—that is to say, the licensing provisions—and at this second stage the Minister would require from the licensees information only in respect of Second Schedule activities. I hope that that explanation may go some little way towards satisfying noble Lords. If I may, I will now turn to the other two Amendments which the noble Lord, Lord Teynham, included in the group of three of which he spoke.
With regard to the first—that to page 54, line 32—the effect of deleting the words which the noble Lord proposes should be deleted would be to preclude the Minister from being able to obtain, until the actual vesting, any information required by the Corporation from any of the companies which will come into public ownership under Part II of the Bill. I will give three examples of the effects, and the noble Lord will then appreciate my difficulties. First, under the noble Lord's Amendment, the Corporation could not, for instance, secure particulars of the companies' accounting methods, and would thus be hampered in putting into effect as soon as possible after the vesting, the standardisation of accountancy methods which is a necessary preliminary to preparing consolidated accounts under Clause 38 (Part IV) as soon as practicable. Secondly, in anticipation of the vesting the Corporation might well consider it desirable to have particulars of the boards of directors and the higher executive staff of the companies, with a view to being ready to make whatever changes they consider desirable with the minimum of delay. Thirdly, the Corporation might consider it desirable to secure information concerning the financial resources of the companies to come into public ownership in order to decide whether it would be desirable for them to exercise their borrowing powers to some extent at an early date. There may well be other matters in regard to which it will make for efficiency and smooth operation for the Corporation to be armed, in advance of the transfer date, with information concerning the various companies which will come into public ownership at that date.
806 These, in brief, are the reasons why I am unable to accept the noble Lord's Amendment. But I am ready, if he is willing, to make a deal with him. Towards that I start by admitting that the clause as drafted does give the Corporation wide powers, and it would enable them to obtain, if so authorised by the Minister, information from, and search the records of, companies carrying out Second Schedule activities. I go further. I admit that as such of these companies as remain under private ownership will be both customers and competitors of the publicly-owned companies, there is ground for the objections to the Corporation's having such wide powers. I said I was endeavouring to arrange a deal with the noble Lord, and in these circumstances, while the Amendment in the form on the Order Paper cannot be accepted, I am authorised to say that the Government are prepared, if the Amendment is withdrawn, to introduce appropriate Amendments at Report stage to secure that the Corporation has no power under Clause 51, except for the purpose of the transfer of publicly-owned companies and matters immediately arising therefrom. That suggested deal, if I may use the words to the noble Lord, may appeal to him.
§ LORD MORRISON
This applies only to the first and second Amendments. I have no authority to make any concession on the third. But I am quite prepared to consider this between now and Report stage, to enable noble Lords to read the actual Amendments which the Government propose to put down. These are: at page 54, line 32, leave out "or the Corporation"; page 54, line 33, after "Act" insert "or by the Corporation for the purposes of Part II and Part IV of this Act." I hope that suggestion may be agreeable to the noble Lord.
We are very grateful to the noble Lord. Of course, we cannot say at the moment whether we can accept the suggested Amendments, but we will see them on the Order Paper on Report stage and will certainly consider them. I beg leave to withdraw my Amendment.
§ THE EARL OF DUDLEY
I hope the noble Lord has not entirely shut the door to further discussion on the third Amendment, because surely the principle is exactly the same. I hope the noble Lord will at least have discussions on all three Amendments.
§ Amendment, by leave, withdrawn.
§ 5.33 p.m.
LORD TEYNHAM moved to add to the clause:
( ) If any person reasonably incurs expense in the course of or for the purposes of complying with any requirement or request whether formal or informal, made or purporting to be made by or on behalf of the Minister or the Corporation under this section, that person shall be entitled to recover the amount of that expense from the Minister or the Corporation as the case may be at the option of that person.
§ The noble Lord said: This Amendment follows a precedent established under the Electricity Act, 1947, which lays down that provision should be made for the payment of expenses incurred for providing information. I feel sure that the Government will have no difficulty in accepting this Amendment. It may be that a company or person will be involved in considerable expense in providing information required under this clause. It may be necessary to employ auditors to make certified returns and perhaps accountants to prepare figures. In some cases it may even be necessary to take on additional staff. It seems only fair that any expenses incurred should be reimbursed when they have been reasonably incurred.
Page 55, line 5, at end, insert the said subsection.—(Lord Teynham.)
§ LORD MORRISON
As the noble Lord has said, it is true that the Electricity Act and the Gas Act provide for payment of expenses to persons required to furnish information and to provide facilities for examining and copying records. But the purpose of the information sections in these two Acts is not the same as that in this Bill. Perhaps the noble Lord has overlooked the fact that in this Bill the Clause 51 powers operate only for twelve months from the general date of transfer for the "once for all" cases, but continue indefinitely for the licensing provisions. In the "once for 808 all cases—that is, during the twelve months' period—the cost should be only relatively small administrative expenses, and generally the companies concerned would be those likely to come into public ownership. But information may be required for the licensing provisions on a recurring basis. It would generally be statistical details, which should be capable of verification without great trouble. Under present conditions, administration is dependent to a large extent on licensing provisions and it is undesirable to make statutory provision for reimbursement of expenses involved in enforcing licensing conditions. In other words, that part of the noble Lord's Amendment which would affect the licensing conditions opens up a matter which goes far beyond the limits of even this Bill. This point was dealt with only recently in the case of the Monopolies Bill, where a proposal that manufacturers should be relieved of the costs of providing statistics was rejected. If this was acceded to in this Bill so far as licensing provisions were concerned, it would have far-reaching consequences on other measures. I am sorry I am unable to accept the Amendment.
§ THE EARL OF DUDLEY
I am sorry I cannot follow the argument of the Minister. There will be certain expenses and possibly considerable expenditure incurred by the free and licensed companies in providing information which the Minister and the Corporation may seek. It is not fair that they should carry the burden of providing that information. There is no fairness in that whatsoever. There should be some mechanism under which they could claim expenses, whether small or large, for providing the information which they have to provide under this Bill. The work involved is not going to help them in any way; it is going to be a dead loss for them. Why should they have the added insult and inconvenience of this expense? I think the Government are very unreasonable. I thought they would have accepted this Amendment straight away.
Probably other noble Lords have seen the calculation which I saw the other day; that the clerical staffs of industrial concerns spend on an average 10 per cent. of their time in filling up forms in answer to Government demands. This may be a little one, 809 as the noble Lord says, but it adds to these other impositions, which mount in time to considerable sums of money. I hope the noble Lord will do something to reconsider by noble friend's Amendment.
I should like to reinforce the last plea. Speaking as one who was a civil servant and was in the habit of asking people for information, I may say that one asks for a great deal of information which one would have no idea of asking for, if one's Department had to bear the cost of it on its Vote.
§ LORD BALFOUR OF INCHRYE
I hope the noble Lord will reconsider this question. If it is known that expenses can be recovered, it may act as a deterrent on those people who seek information very often to an excessive degree. The Government have been very reasonable in many directions this afternoon and have tried to meet us. It seems only fair and reasonable that if information is demanded under Statute, with the full force of the law behind it, those who are put to expense through the excessive use of the wide powers given to the Minister and the Corporation should be reimbursed on a reasonable basis. It is a matter of fair dealing. Would the noble Lord reconsider the matter between now and the next stage of the Bill?
§ LORD MORRISON
The only reason why I am unable to accept this Amendment (I am not disputing whether it is unfair or not) is that it is no more unfair than what happens to employers in all kinds of businesses. Therefore I endeavoured to explain that if this Amendment were accepted it would go far beyond the powers of this Bill—it would not end there. Recently in the Monopolies Bill a proposal that manufacturers should be relieved of the cost of providing statistics was rejected. To accept that in a Bill which deals with iron and steel would seem to me to be opening a door. However, I always try my best to be accommodating, and if noble Lords think conversations will be helpful I am quite prepared to enter into them. I cannot go beyond that.
Frankly, I do not think the noble Lord has made a very good case. He has given no instance of how, if this Amendment were accepted, it would affect other cases outside the 810 Bill. The fact remains that the expenses incurred on behalf of the Corporation will be incurred solely because of this Bill. I would like to reserve the right to look at the matter again, and perhaps we can discuss it before the next stage. In the circumstances, I beg leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Clause 51 agreed to.
§ Clauses 52 to 57 agreed to.
§ Clause 58:
58.—(1) In this Act the following expressions have the meanings hereby respectively assigned to them, that is to say:—
manufacturing purposes," includes the carrying-out of building operations and works of construction or civil engineering and the treatment of products by any process;
§ 5.42 p.m.
This is almost a drafting Amendment. In this clause, both at the bottom of page 59 and at the top of page 60, the word "group" is used. It is presumably used in its semi-technical accounting sense, as there is no definition in the clause of the word "group." I beg to move.
§ Amendment moved—
Page 58, line 19, at end insert—
("'group' in relation to companies means a company and all other companies which are subsidiaries thereof.")—(Lord Hawke.)
The noble Lord said that this is almost a drafting Amendment, but some of those take the longest time. If we really thresh this matter out we shall have quite a good discussion. We are convinced that this Amendment is not appropriate. I will explain to the noble Lord why, and perhaps he will then consider whether he feels it necessary to press the point or to discuss it afterwards. There is no need at all for the definition of the word "group" in the Bill as drafted. The word is used in Clause 38 (3), to which the noble Lord has not alluded, in connection with "group accounts." There "group" is defined by reference to Section 150 (1) of the Companies Act, 1948. It is also used in the definition of "publicly-owned company" in Clause 58. That is what the noble Lord has in mind. May I put the meaning of this admittedly rather abstruse passage at the end of page 59 in non- 811 technical language? What one really means there is that a publicly-owned company is a member of this group, which consists of the Corporation and all the wholly-owned subsidiaries. They would be either wholly-owned subsidiaries of the Corporation, or wholly-owned subsidiaries of the wholly-owned subsidiaries of the Corporation—either the children or the grandchildren. That is the meaning. I have taken advice on this point, and I am assured that I am not putting it inaccurately when I state it as I have. The passage is admittedly rather abstruse, and I am sure the way in which I have given it is not so capable of legal interpretation as the way in which it is put here. If the noble Lord can see his way to withdraw the Amendment, perhaps we can discuss the point with the object of seeing whether matters can be helped along.
Do I understand the noble Lord to say that "group" as used on page 59 and 60 has no technical connotation, but just means a collection?
If that is the case, does not the noble Lord think it a little misleading to use the word "group," which has achieved a semi-technical meaning? Perhaps our explorations, if we have any, might go towards seeing whether "bunch" would not be a better word than "group" in this particular context.
If I may put it colloquially, I have a "hunch" that the word "bunch" will not "fill the bill." Perhaps I can pursue this matter with the noble Lord. I am assured that this passage—which, in my view, is not the clearest or most artistic piece of draftsmanship I have ever come across—is, in fact, a masterpiece of the draftsman's art and cannot be improved upon.
At the moment I will leave the noble Lord with his legal 812 entente, and beg leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
LORD ROCHDALE moved to add to the definition of "manufacturing purposes":
and the use of products for the carrying out of building operations or works of construction or civil engineering shall be deemed to be use by the building owner as well as the builder or contractor.
The noble Lord said: This is a simple Amendment, and I can explain it in a few words. Your Lordships will remember that in the Consumers' Council the people who can make representations are referred to as consumers. In this clause "consumers" is interpreted as meaning those who use products for manufacturing purposes. Turning over the page, one sees that "manufacturing purposes" includes "the carrying-out of building operations and works of constructional or civil engineering." All this Amendment seeks to do is to clarify the position. Suppose you have an industrialist who wishes to build a factory and who may be in a big way of business and have his own building staff. Under the clause as drafted he is a consumer and can make representations, if he wishes, to the Consumers' Council. But if he is a man in a small way of business, not having his own building staff but employing a contractor, it seems that there is some doubt whether he is a consumer and can make representations. If the noble Lord can assure me that the man who uses a contractor is just as much covered as the man who uses his own staff, I shall be satisfied. As it is at present, the point does not seem very clear. It is of some importance, because 30 per cent. of the constructional engineering works in the country are likely to be taken over with the publicly-owned companies when they are transferred to the Corporation. I beg to move.
Page 58, line 33, at end, insert the said words.—(Lord Rochdale.)
I personally was not aware of the figures the noble Lord has just given. I have no doubt they are correct, and I have no doubt that my advisers are thoroughly aware of them. I am afraid that, without fuller consultation, I cannot satisfy the noble Lord, and 813 I do not really wish to hold out an expectation of being able to satisfy him, anxious though we are this afternoon to meet noble Lords in every way. As at present advised, it is very difficult to define "building owners." I do not know whether the noble Lord has taken legal advice, but that does not appear to be a term which is very familiar to the experts. Once one began extending the range of the Consumers' Council to cover persons of this type, it is difficult to see where one would draw the line. I am afraid I cannot hold out much hope to the noble Lord, but I should have thought there was no danger of their interests being neglected.
The noble Lord will appreciate that there may be very little difference between whether you employ contractors or not. You might on one operation employ a contractor, and carry out the next one yourself. However, I will not pursue this Amendment further at the moment. In view of what the noble Lord has said about the difficulty of interpretation, I beg leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Clause 58 agreed to.
§ Clause 59 agreed to.
§ Clause 60 [Short title and extent]:
§ VISCOUNT SWINTON
We took the decision on this Amendment on Clause 11; it is consequential to that. I beg to move.
§ Amendment moved—
Page 62, line 10, at end insert—
("( ) This Act shall come into force on the first day of October, nineteen hundred and fifty.")—(Viscount Swinton.)
§ On Question, Amendment agreed to.
§ Clause 60, as amended, agreed to.
§ First to Fourth Schedules agreed to.
§ Fifth Schedule [Provisions as to office of stockholders' representative, meetings of holders of securities and incidental matters]:
§ 5.50 p.m.
LORD LLOYD moved, after paragraph 16 to insert:
( ) At the conclusion of the proceedings of the said meeting, or of any adjournment thereof, as the case may be, the stockholders'
representative unless the meeting resolve otherwise shall, in so far as concerns any matter disclosed in the said statement or at the said meeting, or at any adjournment thereof, stand discharged as between himself and the holders of securities of his duties and responsibilities as such representative.
The noble Lord said: This Amendment is really a "tidying-up" Amendment to deal with this question of the stockholders' representative. If your Lordships will look at page 74, you will find that when the stockholders' representative has finished his duties he has to report back to his stockholders as to how he has fared, and what he has done; and then, apparently, so far as one can see from the Schedule, nothing more happens. In fact, the unfortunate man is left being a stockholders' representative, possibly until the end of his life. We feel that he ought to be formally discharged when he has completed his duties, and the Amendment which I am moving seeks to cover that. I beg to move.
Page 74, line 32, at end insert the said paragraph.—(Lord Lloyd.)
§ LORD LUCAS OF CHILWORTH
I hope to persuade the noble Lord that this is not necessary. I think the noble Lord has borrowed this from the Gas Act.
§ LORD LUCAS OF CHILWORTH
I thought so. The circumstances are not comparable. In the case of gas, the stockholders' representative had the duty of discharging the final payments of dividend. In this case he has not, and when he has convened this meeting, and given the stockholders an account of his-stewardship, his duties end. He has nothing else to do, as paragraph 16 of the Fifth Schedule plainly lays down. I hope to persuade the noble Lord that it is absolutely unnecessary to load the Bill with these words, and I hope he will withdraw the Amendment.
My advice was that these words were necessary, but it is not an Amendment upon which I feel strongly. I am perfectly prepared to take the noble Lord's assurance that these words are unnecessary, and I beg leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Fifth Schedule agreed to.815
§ Sixth Schedule:
§ Acquisition of certain assets
§ 5. The compensation payable under the preceding provisions of this Schedule by the Corporation shall be satisfied by the issue to the transferor of such amount of British Iron and Steel Stock as, in the opinion of the Treasury, was on the general date of transfer of a value equal to that compensation, regard being had (in estimating the value of the stock so issued) to the market value of government securities at or about the general date of transfer; and the Corporation shall be liable to pay interest on that amount, at such rates as the Treasury may determine, from the said date (that is, the date referred to in paragraph 1 of this Schedule) until the date of payment.
§ 5.54 p.m.
LORD HAWKE moved to add to paragraph 5:
Provided that in a case to which paragraph (4) of this Schedule applies payment of the compensation shall be made to the encumbrance in cash.
§ The noble Lord said: This Amendment is of rather more importance than one or two with which we have just dealt. Clause 23 is what one might call the "clawing-back" clause. Where a company, after a certain date towards the end of 1948, have parted with any rights of ownership in works, patents, inventions or designs, the Minister may get them back if it is necessary for the Corporation to have them. Now the company will have parted with those properties to someone else, and the new owner may well have raised money on them. He then becomes the peculiar form of animal known as the encumbrancer. Under the Bill, the encumbrancer has to be paid off before the property returns back, and the Corporation have to deal with the encumbrancer direct. Now from the way in which the Schedule is drafted, it rather looks as if the draftsmen had in mind that this encumbrancer was going to receive cash, as it would seem right and proper that he should. But in practice, of course, he is going to receive this script. So having lent money—hard cash—only a short time before he is now to get a piece of paper which may or may not be realisable for the amount of money which he advanced on the property. I should add that a lot of these amounts might well be small, particularly in the case of designs, patents, inventions and so on, and in those cases it would be quite unsuitable to pay off encumbrancers in script. In the other cases, where the amounts would 816 be large, admittedly it would be practicable to pay them off in script, but I do not think it would be equitable. For those reasons we seek to amend the Bill. I beg to move.
Page 77, line 22, at end insert the said proviso.—(Lord Hawke.)
I should like briefly to support this Amendment, because it is rather an important one. I should like to add a word with regard to mortgages. I think your Lordships will agree that if one takes a mortgage on a property one expects normally that it should be regarded as a cash transaction. One buys shares on the Stock Exchange, or something like that, and accepts various risks of the market; but a mortgage has always been a cash transaction and undoubtedly, as my noble friend has said, many of these amounts are small and would be much more easily satisfied by cash. I think there is a very strong case for this Amendment, and I hope the Government will accept it.
I am far from denying that one could imagine hard cases arising in the sort of situation envisaged by the noble Lord, but there are three arguments the other way which I should mention before I ask the noble Lord to adopt an attitude—the noble Lord smiles: he must have his joke, but I wish he would disclose it.
I hope the noble Lord will adopt an attitude of gravity while I am answering what he has represented as a very grave problem. In the first place, the general basis for the Bill is that compensation is payable in stock, and the noble Lord is asking us to make an exception. The second point, of course, is that all concerned in the kind of transaction he has in mind under Clause 23 have entered into this with their eyes open. That includes the encumbrancers, because the operations cannot have begun until after the Bill was introduced. So do not let us think there is some fair lender who had entered into this arrangement before he knew there was to be a Bill of this kind. The third point—and I ask for the noble Lord's close attention, because he rightly represented that this 817 was a matter not without importance—is that an Amendment such as he is suggesting would lay itself open to rather grave abuse. May I take the noble Lord through an actual illustration with which I have been provided?
Suppose that a Third Schedule company—Company A—after the date of the introduction of the Bill had disposed of its power-house to Company B for £4,000. B obtains a loan from C on the security of the power-house. The Minister thinks that the power-house is essential in the public interest for the efficient carrying-on of the business of A, and to reintegrate the power-house with Company A serves the appropriate notice under Clause 23. The compensation is prescribed in paragraph 3 of the Sixth Schedule and is payable in British Iron and Steel Stock. It is payable by £1,000 to the lender, who satisfies his claim and hands the balance to B. That is as at present proposed. But let us take the case of what would happen under the noble Lord's Amendment, and assume that the actual amount of the loan was only £5. Now, if the noble Lord has his way, then £1,000 would be paid in cash to C, who keeps £5 and pays over £995 to B. By this arrangement (a perfectly legal one) B would be the fortunate gentleman who had collected £995 in cash instead of stock—which would be the fate of his rivals and competitors. That is a genuine difficulty. In face of it, I do not ask the noble Lord to form an attitude too quickly, but it is a difficulty, and perhaps he would like a little time to think it over.
I think the example that the noble Lord has given does credit to the ingenuity of his advisers: it is yet another example of the remarkable ingenuity of the professional advisers of His Majesty's Government in discovering the evil things that other people might do. It might sometimes tend to disclose the thoughts that at times pass through their own minds! I freely admit this case might occur, but it seems to me an extraordinarily far-fetched possibility. I do not see that a tremendous lot of harm has been done if one company happens to get some cash instead of script. After all, Government stock is ultimately realisable in cash, and it is just a question of market value. The mortgagee, who is the encumbrancer, might 818 lose a few pounds per cent. under the Bill as it stands, whereas giving him cash makes certain that he does not. The noble Lord visualises a sort of conspiracy which is not a genuine transaction. I cannot deny that such a thing could happen; anybody who knows his Sherlock Holmes as well as the noble Lord and I do, knows that many strange things might happen—but such things do not happen in the iron and steel trade, with whom we are dealing. I do not propose to press this Amendment, but I must say I think the noble Lord is showing more ingenuity than reasonableness in the matter. I beg leave to withdraw my Amendment.
§ Amendment, by leave, withdrawn.
§ Sixth Schedule agreed to.
§ Seventh Schedule:
§ Provisions as to British Iron and Steel Stock
§ (4) Notwithstanding anything in the preceding provisions of this paragraph the Corporation may, with the consent of the Minister and the approval of the Treasury, employ for any of the purposes for which money may be borrowed by the issue of stock any money for the time being standing to the credit of any Redemption Fund Account and for such purposes as aforesaid sell any securities in which the last mentioned money is for the time being invested and employ the proceeds:
§ VISCOUNT BRIDGEMAN moved, in paragraph 4, to omit sub-paragraph (4). The noble Viscount said: I am sorry to say that, Lord Rennell, in whose name this Amendment stands, is unwell, and I know he would wish me to apologise to noble Lords opposite for his unavoidable absence. This Amendment is put down partly as a clarifying Amendment, but it is also intended as a mild protest against what looks like an encouragement to imprudent finance on the part of the Iron and Steel Corporation. Your Lordships will remember that, when we were dealing with Clause 32, we were at some pains to discover exactly how much cash His Majesty's Government considered that the Iron and Steel Corporation should have at their disposal. There was, first, the £350,000,000 borrowing powers, and there was also an unspecified amount of temporary borrowing. One would have thought that between them these 819 two would have given the Corporation an ample supply of cash for all legitimate purposes.
But paragraph 4 (4) of the Seventh Schedule says:
… the Corporation may, with the consent of the Minister and the approval of the Treasury, employ for any of the purposes for which money may be borrowed"—
that, I take it, is for Clause 32 purposes—
by the issue of stock any money for the time being standing to the credit of any Redemption Fund Account …
Many people feel that money once placed in, or transferred to, funds earmarked for the redemption of stock should be left there; that is to say, that for every £1 shown on one side of the balance sheet there should be gilt-edged securities, or such like, immediately realisable on the other side, so that a policy of redeeming stock can be carried on, without risk of its being jeopardised by unfortunate financial occurrences. Here, it seems to me, we have a provision which may be interpreted to mean the reverse of that state of affairs. It would be perfectly possible, as I understand it, to find that money which had been used in good faith for some other purpose specified in the Act would not be available at the time redemption was due. This might surely have an adverse effect on the policy of redemption which, as was suggested earlier in the discussion on this Bill, should be a long-term policy organised for ninety years. We are a little suspicious of this clause, because it opens the door to illegitimate supplies of cash and other evils. I beg to move.
Page 79, line 22, leave out sub-paragraph (4).—(Viscount Bridgeman.)
§ LORD LUCAS OF CHILWORTH
May I express, on behalf of noble Lords on these Benches, our regret at the unfortunate illness of Lord Rennell? At the same time, if I may be allowed to say so with respect, his absence has at least enabled the noble Viscount to state the case concisely, shortly, and with great point. The noble Viscount's contention that this money should be invested only in easily negotiable stocks—not only gilt-edged but also trustee stocks—easily realisable, is one to which His Majesty's Government do not altogether subscribe. It seems to some of us not to be a good 820 policy that, if you have money in a redemption fund account, you should not be able to use that money for purposes for which, as the noble Viscount has pointed out, you have powers of borrowing. He bases his argument on the question of risk—the risk that when the specified period came to an end there would not be sufficient money in the redemption fund account to redeem the stock. But I think the noble Viscount has lost sight of one very important fact, which is that this money can be used only with the consent of the Minister and the approval of the Treasury.
The Treasury, on behalf of His Majesty's Government and of Britain, are the guarantors, and so over the twenty or thirty or ninety years' period for which the stock is issued, there is no risk whatsoever, because if the money is not there it will have to be found by new borrowing, and it will have to have the Treasury guarantee. If the noble Lord says there is a risk, he is inadvertently impugning the credit of the Government in this country, and I am certain he has not the faintest intention of doing that. I think he will see that there is no risk while the stock is Government-guaranteed gilt-edged stock. While the guarantee of this country is behind it, there must always be money in the redemption funds account to meet the redemption stock, and if it has been used for any purpose, which the Treasury must approve, it will be the responsibility of the Treasury to put the money there to redeem the stock. That is my answer to the noble Viscount. I hope that it completely satisfies him.
§ VISCOUNT BRIDGEMAN
I am much obliged to the noble Lord opposite for his very clear answer. It does not completely satisfy me, because I think that up to a point it is begging the question. If the Corporation were an ordinary public company, I think—I am not certain—that the auditors of that company would not take a 100 per cent. good view if the directors proposed to use the redemption monies in this way. I certainly would not have suggested that the Treasury guarantee was not good enough for anything. I am suggesting that a situation ought not to arise where a Treasury guarantee has to be given in order to make possible a transaction 821 which, by many ordinary standards in finance, would be looked on with suspicion. However, I think discussion on this Amendment has served to clear the position. The double safeguard of the Minister and the Treasury certainly makes it unlikely that anything will go wrong. All I can say is that I hope this provision will be very little used, because the less it is used the greater the indication that the finances of the Corporation are soundly run. I beg leave to withdraw my Amendment.
§ Amendment, by leave, withdrawn.
§ Seventh Schedule agreed to.
§ Eighth Schedule agreed to.
§ Ninth Schedule [Modifications as to constitution and proceedings of publicly-owned companies]:
VISCOUNT SWINTON moved, after paragraph 7 to insert:
A publicly-owned company shall not, without the consent in writing of the Minister, alter any of the provisions of its articles of association which relate to or affect the appointment or tenure of office of its chairman man or president or similar officer or of its directors or any of them.
§ The noble Viscount said: In the regrettable and unexpected absence of my noble friend Lord Layton I must do my best to put myself into his mind, as well as to take his place. I know that his object in putting down this Amendment was to add material for the discussion on how we are to preserve the independence of these companies, and reconcile it with the overriding control of the Corporation. Your Lordships will appreciate that the Corporation, when it becomes the sole shareholder of these companies, can get rid of every single director at a moment's notice. This Amendment, which my noble friend, Lord Layton, discussed with me, is not put down in the interests of keeping jobs for directors as directors. I am sure your Lordships will appreciate that. It is down to try to secure that there is a reasonable measure of independence. Of course, when there are vacancies on boards the Corporation, as the shareholder, will appoint.
§ We have often been told that the Corporation ought to have the powers of shareholders in ordinary public companies and should exercise them as such. But, of course, the Memorandum and Articles of Association of a public company pro- 822 vide for the directors retiring in rotation and others being nominated in their place in the event of the retiring directors not coming up for re-election.
§ That, of course, gives some measure of security. But if there is a director with whom the company cannot get on, they do their best to get rid of him—and they generally succeed. One does it even in a Cabinet sometimes! I see that my noble friend Lord Layton is now present—I beg his pardon. I hope that I am correctly putting forward what he wishes to be said. If the shareholders want to get rid of a director, they can get rid of him. But, after all, there has to be a majority of the shareholders to do it. They may not all take the same view. Some of them may not like a certain director, while others may say that he is extremely good. At any rate, it goes by the vote. This time, there will be only one voter, as is the case with the Communist Party. The only voter will be the Minister or the Corporation. Having thus gone in and opened the innings—I hope in conformity with what my noble friend, Lord Layton, had in mind—I think that in his interests and in the interests of the Committee I cannot do better than resume my seat and make way for my noble friend to continue. I beg to move.
Page 95, line 16, at end insert the said words.—(Viscount Swinton.)
§ 6.17 p.m.
§ LORD LAYTON
I must apologise to your Lordships for not being in my place during the afternoon. Your Lordships have dealt with the Amendments on the Order Paper with a greater speed than some expected. I do not wish to speak at any length on this Amendment. It was put on the Order Paper primarily in order that we might draw attention to the point that the autonomy of the separate companies, which is to be discussed between the present stage and Report stage, should include the question of security of tenure of directors. I make no pretence to suggest that this Amendment is drawn in an ideal form. Quite obviously the Articles of Association must vary greatly in this matter of the tenure of office of directors, their retirement by rotation and so forth. But, as I said previously in discussing a previous Amendment, the Bill as it stands at 823 present permits the Corporation to sweep away the Articles of Association at any moment, and there is nothing whatever to give any indication that the Corporation propose to establish any standard rules—for example, about the retaining of power by directors, and so forth. Clearly, it is to be a competition. Two things are required. One is that the independent companies should be able to back their opinion against authority. The second is that, if that opinion is to be effectively expressed there must be some final security of tenure for the management, the directors, to prove themselves right.
I do not propose to discuss this now because something will arise upon this issue. There are many variants of this type of concept. I do not suggest that this is a specific, concrete proposition, but it would be in tune with the views of those of us who are concerned with the idea of retaining independence, if some such provision for continuity of tenure were made contingent upon a profit being made by the independent concern. That concept would be completely in line with the idea that, so long as an independent firm is efficient—and profit is the old-established test—there should be definite limits to the possibility of the Corporation changing management and imposing standard rules upon it. I table this Amendment only in order that this topic might come up in the course of discussions as to the autonomy of the independent companies.
We all envy the noble Viscount his capacity to go in to bat at a moment's notice. We would agree that there is no one who has, so to speak, his pads on so continuously. He is never taken unawares.
He hits sixes occasionally—and also loses his wicket occasionally. The noble Viscount took on this matter at short notice in a way that would appeal to the noble Lord, Lord Layton, who has exempted me from pursuing the merits of the case at any length. Though no doubt it is in the minds of noble Lords who have spoken, I would mention, for the benefit of the Committee, that paragraph 7 of the Ninth Schedule 824 provides that, notwithstanding anything in the Memoranda of the existing companies, it shall be competent for the shareholders—that is, the Corporation—to give twenty-eight days' notice of a resolution for the removal of a director; and in this respect it corresponds with Section 184 of the Companies Act, 1948. I bear in mind what the noble Lord has said or implied in relation to that matter, but what I have just said should go on record for the purposes of the Committee.
The noble Viscount and Lord Layton both agree that this point is closely linked with the issues raised on the new clause after Clause 4. I would just say here—and I hope no one will think I am trying to bang the door or prejudice the outcome of these talks—that the Minister has considered the matter further and it is his view at this stage that it would be inappropriate to write into the Statute provisions determining human relations and normal matters of organisation. I think I should say that in advance, to give the Committee some idea of his point of view. I should add that it would be particularly inappropriate to lay down rules about the relationship between the individuals on the Steel Board and the individuals on the boards of these companies in a way that would imply that there was not going to be good and gentlemanly feeling between them. We all assume, on whatever side of the Committee we sit, that there will be co-operation between these various bodies, and I know the Minister would be particularly loath to say anything which would imply the contrary. So much by way of generalisation. These matters are clearly linked with the suggested new clause, and in the circumstances I hope the noble Lords will withdraw the Amendment.
§ VISCOUNT SWINTON
Of course I respond to the appeal to withdraw the Amendment, and I will not say any more than this about the negotiations, which I hope may be fruitful although I must admit it did not look as though we were very close together last time. If nothing is put into the Bill about what the noble Lord calls "human relations"—"human relations" in this connection means the relations between the Corporation and the companies—that is the equivalent to saying there can be no human relationship at all. If that is the 825 view, it is very difficult to see on what basis the negotiations can start, much less how they can arrive at any agreed conclusion. I know the noble Lord is speaking for the Minister but I would just ask him to reconsider this. By providing in a contract that in cases of dispute you go to arbitration, you do not assume that the parties are going to have disputes about everything. Indeed, arbitrations are referred to throughout this Bill. It really does not mean that.
All of us have entered into agreements which, as a common form, have included an arbitration clause, but in the experience of anybody here I am sure that has never meant that we did not carry out our contract. Often it is a working contract, going on from day to day with every kind of possibility for difference of opinion, yet it has not in the least meant that the parties to the contract have not worked in complete harmony. By laying down certain laws saying that people shall not do things, you do not assume that everybody is a criminal. I am not insulted by the fact that there are laws which say we are not to offend against the Ten Commandments. I do not feel that a personal insult, which makes it impossible for me to think of friendly relations with anybody. I hope before we get into these negotiations we can clear our minds of that sort of thing. The noble Lord himself belongs both politically and religiously to bodies which have not hesitated to lay down definite rules of conduct, but I am sure he has had a most enjoyable and upright life in spite of it.
The rules to which the noble Viscount refers I have always found most helpful, and perhaps at some time the noble Viscount might like to enjoy them with me. I will not say more except that we all want to see thoroughly good discussions, and I am grateful to the noble Viscount for withdrawing his Amendment.
§ Amendment, by leave, withdrawn.
§ Ninth Schedule agreed to.
§ VISCOUNT SWINTON moved, after the Ninth Schedule, to insert the following new Schedule:
§ "Description of Iron or Steel Products
§ 1. Iron or steel (including alloy steel) in any of the following forms (and whether or not new or secondhand or prime or defective)—826
§ Billet, bloom, slab;
§ Tinplate bar, sheet bar;
§ Plate, medium plate, sheet (and whether coated or uncoated);
§ Angle, channel, tee, joist, piling section, other sectional material (and whether fabricated or not);
§ Round, rod, square, hexagon, flat, other section and shape (and whether black or bright);
§ Rail, sleeper, fishplate, soleplate;
§ Tinplate, tinplate base (uncoated), terne plate, black plate, silver-finished plate;
§ Hoop, strip (and whether coated or uncoated, and whether hot or cold rolled);
§ Tube, pipe and standard fittings (not being conduit fittings) therefor;
§ Tyre, axle, wheel;
§ Casting, block for forging, block for pressing, forging, drop forging;
§ Colliery arch, and accessories therefor, pit prop;
§ Wire rod;
§ Coated or uncoated wire (whether plain or barbed), wire rope, wire strand, wire netting, wire chain link fencing, wire reinforcement fabric mesh, wire rod reinforcement fabric mesh, wire nail, wire staple;
§ Bolts, nuts, screws, screw studs, washers and rivets.
§ 2. Ferro alloy of any kind.
§ 3. Scrap iron and scrap steel (including alloy steel)."
The noble Viscount said: The last wicket is a genuine child of my own—not that I disliked being associated with the other one. The Committee will remember that in the Clause we inserted after Clause 6 we provided for the establishment of an Iron and Steel Prices Board and subsection (4) of that new clause provided in this connection that the expression "specified products" meant
iron or steel products of any of the descriptions set out in the Tenth Schedule of this Act and such other descriptions as may be specified in an order of the Minister.
Here is the Tenth Schedule, and I do not expect the Committee will want to discuss it in any detail. Obviously, having passed the new clause, the Schedule must be inserted. May I explain in a word or two what it contains and why it does not contain certain ether things? The Schedule itself is a comprehensive list of iron and steel products as generally understood, and those who are familiar with the control orders about iron and steel prices will see that it is based on the Control of Iron and Steel (No. 62) Order, 1948, the Control of Bolts and Nuts
Orders, and the Control of Iron and Steel (Scrap) Orders. "Scrap" is the third in the list. Therefore it does contain, with an exception to which I am coming in a moment, those obvious products of iron and steel which have been the subject of control orders and for which it has been found necessary and desirable to have prices fixed in the past.
§ I ought to draw the Committee's attention to two notable omissions from the Control of Iron and Steel Order. First, we have deliberately left out iron and manganese and other ores, for the simple reason that the whole of the ore production will be taken over by the Corporation, and, therefore, the price of ore as distinct from the price of ingot steel and pig iron does not come to be determined. The Prices Board will control pig and ingot prices, and so on, and therefore we thought it was unnecessary to include this item. In the same way, cinder and scale used to figure in the control orders, but the Corporation will be the main producer and the main consumer, and therefore price control appears to be unnecessary and it is not included.
§ There are a certain number of other things like calcium silicide, tungsten metal, and chemical compounds of molybdenum, tungsten or vanadium which, together with carbon electrodes, used to figure in the order. All those will be imported. Both the Corporation and the independent producers will be dependent on external supplies, and it did not seem necessary (to use the phrase which has been so often used in refusing Amendments which we have proposed) to clutter up the Schedule with those items. Subject to that, this Schedule is in conformity with the list which has worked so well in the past. I therefore hope that it will commend itself to your Lordships as a commendable counterpart of the clause already agreed to. I beg to move.
After the Ninth Schedule insert the said new Schedule.—(Viscount Swinton.)
§ THE LORD PRIVY SEAL (VISCOUNT ADDISON)
I have the great pleasure of speaking to the last Amendment. I recognise that this is an inevitable consequence of the Iron and Steel Prices Board Amendment, as I think the noble Viscount said. We are not in a 828 position to object at the moment but our views remain the same. If the Committee want to know the complexities into which the noble Lords have landed them I commend them to read the noble Viscount's speech. With regard to this Schedule, I have looked at this list (I am a bit of a carpenter myself) and I see that it includes such things as nuts, bolts, screws, screw studs, washers and rivets. But it does not include tintacks, or a number of other things which I have in my workshop. However, the noble Lords have set down and made as good a list as they could, and we are not in a position here to oppose it.
§ On Question, Amendment agreed to.
§ House resumed.