HL Deb 04 July 1951 vol 172 cc579-624

2.45 p.m.

LORD STRABOLGI rose to draw attention to the position of Parliament with regard to the administration of nationalised industries, and to the position of noble Lords who have undertaken duties in connection with these industries; and to move for Papers. The noble Lord said: My Lords, the Motion which I have the honour to present to your Lordships divides itself into two parts, although I suggest that they are interlocked and have a bearing upon each other. The first is how best modern democracy can control and ensure the efficiency of its nationalised industries: and the second concerns the position of noble Lords who undertake duties in such industries. I should like to deal briefly with the second part first. I have made inquiries from the Government, and find that there are thirty-eight of your Lordships who hold positions of profit under the Crown, including, of course, the heads of the nationalised industries, the Chairmen of Boards and so on, but excluding Ministers, diplomats, civil servants, members of the Forces, and the occupants of the Episcopal Bench. But there are thirty-eight others, of whom fourteencan be identified as members of my Party. So that, if a spoils system is in operation, it is only partly operative.

VISCOUNT SWINTON

The others may be "fellow travellers."

LORD STRABOLGI

I said fourteen who can be identified as members of the Labour Party. It is marvellous, when the Labour Partywin a victory, how many Socialists we discover in unexpected places. The question of the position of our noble colleagues in this House is, I suggest, one of public, constitutional and Parliamentary importance. It is a new development, of course, and the position of these noble Lords is comparatively novel.

I understand that the original edict given from on high was that noble Lords who hold positions on the boards of nationalised industries were to remain completely silent in this Chamber on all occasions, though they could, and did, speak as much as they liked in public about their responsibilities, so long as it was not inside the Palace of Westminster. A number of us, in all Parties, have felt for some time that this position was untenable, and that Parliament on occasions was losing valuable counsel and advice. Apparently the leaders of the three Parties also thought it was necessary that something should be done about it. I gather that they got together in conclave and, no doubt after careful consideration, the result was that suddenly, without notice to anyone, they issued the pronunciamento made by my noble friend the Lord President of the Council (whose continued absenceI am sure we all regret) on March 21 in answer to a private notice Question by the noble Lord, Lord Hawke. I thought at the time—and I believe I was not alone in this—that a mere statement of this kind, and a few laudatory remarks by the eminent leaders of the Opposition Parties, was not sufficient; that this was a matter which concerns Parliament as a whole, the public interest, and the privileges, rights, duties and the prerogatives of the noble Lords concerned.

I gave notice that I should seek an opportunity of bringing this matter before your Lordships and I should have done so earlier. There was a day on which I found a vacancy, but that day was also taken for a very happy event—namely, the introduction to the Order of the Garter of the Lord President himself and the Leader of the Opposition. That is something which happens only once in a lifetime, like birth and death, and so for those reasons I postponed the Motion. But it is still important and still urgent and, I suggest, still worthy of attention. With regard to my noble colleagues who hold these positions, to my knowledge or within my hearing so far only two have made set speeches in your Lordships' House. One occasion was when my noble friend Lord Simon of Wythenshawe, who was under personal attack for some difference in the B.B.C. about broadcasting or not broadcasting a rather feeble play, was allowed to defend his actions. The other occasion was after my noble friend Lord Trefgarne resigned from the chairmanship of the Colonial Development Corporation. Those, I think, were the only two major speeches made by noble Lords holding these positions and seats in your Lordships' House. We had one or two short but, if I may say so, valuable interventions by my noble friend Lord Douglas of Kirtleside, when matters particularly affecting civil aviation and his Corporation have come under your Lordships' debate, and I think his interventions were welcomed.

I have not been in your Lordships' House very long. I have been here a matter of only some sixteen years, and I have not the experience of many of your Lordships, but I venture to suggest that there will be and should be occasions upon which, without in any way impinging upon the prerogatives of the Minister concerned, a nobleLord who holds one of these great positions in a nationalised industry could give your Lordships very valuable counsel and advice. This seems to be recognised by the statement of March 21 by my noble friend the Lord President. But I think we need a little clarification of this matter. I do not think it is entirely clear what the exact position is, and I invite my noble friend the Chancellor of the Duchy—Who I understand is going to be good enough to reply—to give us some further enlightenment.

With regard to the other part of my Motion—the question of the control of the nationalised industries and great public monopolies—it is almost a year since we had a very important debate in your Lordships' House initiated by my noble friend Lord Lindsay of Birker, on July 5 last year. I have been re-reading that debate, and I see that there was general agreement in all parts of the House that the Consumers' Councils—which were supposed to safeguard the interests of the public against these great corporations—were generally a failure. Even my noble friend Lord Pakenham, who was then speaking for the Government, seemed to admit that that was so. Of course, these Consumers' Councils are new and the wholesituation is comparatively new, but my information is that there has been some improvement. I think we should all recognise that we are in a transitional stage and the whole situation is in process of development, including the means of safeguarding the rights of the general public and the public interest where these great corporations are concerned. At the same time, I do not think any of your Lordships will deny that the ultimate responsibility—and it is a very great responsibility—rests on Parliament.

We had a statement yesterday by the Paymaster General, and my noble friend then outlined the measures which it was proposed to pursue with regard to Parliamentary control. It seemed to me that the most valuable—though it is not very valuable, as I shall presently show was that there should be periodical debates on the accounts and reports of these boards. Many of your Lordships have had experience in another place, and you all have experience of this place. A Parliamentary debate on a monumental work such as the Annual Report of the National Coal Board, the Transport. Board or the Electricity Authority, is apt to be desultory. You get all sorts of people raising their local questions, naturally and rightly (I am speaking now particularly of another place) and it is difficult to avoid Party manoeuvres. Party feeling is bound to come into it. Although a full dress cebate of that kind is very valuable—I think the one last year served a most useful purpose—it is not enough, and something more is required. Presumably, the mines, the railways, public transport (including civil aviation), the Bank of England, the electricity and gas industries, the British Broadcasting Corporation, Cable and Wireless, et cetera—all the industries or services which are at present in national ownership, with the possible exception of iron and steel—will remain in national ownership. There will be alterations and amendments and a different method of control and so on if another Party forms the Government, but I do not think it is seriously proposed that, in the event of electoral misfortune bringing the Conservatives back into office, they would proceed to unscramble all those omelettes. Therefore, I think I carry your Lordships with me when I say that this is aproblem which will remain with us for many years ahead. Nor do I propose to say anything about whether there would be further measures of nationalisation in the event of a Labour Government taking office with a larger majority than at present. That would be quite outside the scope of my Motion, and I am sure your Lordships will not expect me to bring that in. I am dealing with the situation as it is.

Here are these great corporations on which the whole welfare of the community and nation depends, and anyone would be extremely bold to say that all was well and that they could carry on by themselves without adequate Parliamentary control. In fact, without adequate Parliamentary control we approach the condition of syndicalism. If these great monopolies are allowed to carry on with only the Minister exercising private pressure upon them, with no effective Parliamentary control—the operative word is "effective"—we are in a situation of syndicalism. Although syndicalism may be the form in which democracy may develop, there is no mandate for it from the public at all. I do not think the public have ever had put before them the idea that when these great industries were nationalised (and the matter has been publicly debated for a generation or more) there would not be full ultimate control by Parliament and the Government of the day.

In this connection, I wonder whether my noble friend (I am sure he has) and his colleagues (I am not sure if all of them have) have read the papers produced by a number of my honourable friends in another place who form the nationalised industries group of the Parliamentary Labour Party? They have given a great deal of study to this whole question and they have produced some very valuable papers. They seem to feel doubt about the present state of affairs, while recognising that we are in a process of evolution. I am going to quote only one of their reports but it is, I think, very important.

LORD HAWKE

May I ask the noble Lord whether these reports are available to the public? Can one obtain them to read them?

LORD STRABOLGI

I was coming to that. I do not know whether these reports have been published, but they are open to any member of the Labour Party. I shall be delighted to lend the noble Lord my copies if he would like to see them. I consider they should be published. In any case they are not marked "confidential."

But what I am exercised about is whether Ministers and the people directly concerned in these great Corporations have studied these papers. Perhaps I may be allowed to give a quotation. It is as follows: The present position appears to he that so far as Parliament is concerned there is little or no control of Public Corporations, apart from Ministerial control exercised privately … I would remind your Lordships that this is a Labour Party group, and its members, naturally, start with a bias in favour of nationalisation. I quote again: Matters of day to day administration are outside the scope of Parliamentary Questions. Theoretically, the boards are answerable to Parliament through the Minister, but the degree of independence which they in fact enjoy raises the whole question of public accountability. The annual report, whilst it is a clear acknowledgment of the obligation of the board to give an account of its affairs, is a record of events many of which have been completed long before there is any opportunity to examine the circumstances which obtained when the decisions relating to those events were made. Something of the sort was said by the noble Viscount, Lord Swinton, during a debate in your Lordships' House about a year ago. There might be a "postmortem" if the Public Accounts Committee, for example, proceeded to examine the Annual Report. In the statement read out yesterday by the Paymaster General, that seemed to be the only concrete suggestion made. Those of us who want to see these nationalised industries succeed—and I think that applies to all of your Lordships, and certainly to myself—are a little exercised. We share that apprehension of the members of this group of experienced Parliamentarians—an apprehension for which I am sure there is justification.

I wonder whether my noble friend and his colleagues in the Government have had their attention drawn to some remarkable articles which appeared last May in the New Statesman by one of the outstanding intellectuals of the Labour Party, Professor G. D. H. Cole —and here I use the word "intellectual" as a compliment: I think all who know Professor Cole, who happens to be my oldest surviving friend in the Labour Party, will admit that his intellectual abilities are outstanding. Since the lamented death of the Webbs, I suppose he is the best-informed and best-read exponent of democratic Socialism in this country. He made some most caustic remarks in these articles, and especially in the second article which appeared on May 12. They are so caustic that I will not quote them. It is indeed remarkable that Professor Cole should find himself driven to reproaches of that kind. Now let me turn to the other side—the non-intellectuals, the trade union leaders. Here, also, I use the term "nonintellectual" in a complimentary sense: these men are the labour leaders of this country. I was rather astonished to hear quoted on the wireless a couple of nights ago some remarks which had been made by Mr. Figgins, general secretary of the National Union of Railwaymen. He was talking about the railways, and I was not very reassured by what he said. He referred to: …the creation of a gigantic corporation run by a special class called management,' which does not wholeheartedly believe in its mission. He went on to plead for a greater appreciation of the disabilities peculiar to the railways and for wider consultations with the railwaymen themselves

These reflections on certain of the nationalised industries come from supporters of the Government and supporters of nationalisation. They all show the necessity and importance of our examining whether we cannot find some system whereby Parliament may become a real guardian of the public interest, while at the same Lime not hampering and persecuting the boards. We found a way in the past with regard to the older nationalised industries—for of course nationalisation is not new. The noble Viscount, Lord Alexander, was a brilliant First Lord of the Admiralty for many years, and he and I sat in another place through many naval debates. The Royal Dockyards have been a nationalised industry for many generations. I remember many of the "Dockyard Members" seizing their opportunities to raise all sorts of questions concerning conditions, pay, efficiency, and so on. I never heard anyone coming to harm because of these discussions. I do not think that those responsible for the Royal Dockyards were "hampered, badgered and persecuted" or deprived of initiative, because of these discussions. In fact, I think my noble friend used to enjoy them. I suppose that the Roya1 Arsenals came under similar review.

Take the case of the Post Office. If we regard the Post Office without any Party bias at all we shall admit that, on the mundane measurements of the profit it makes, it is efficient. People grumble about the British telephone services, but I find then as good as, or better than, telephone services abroad. The whole postal service is admirable, and yet the Post Office has for many years been open to the closest scrutiny by Parliament, and no one has suffered any harm, so far as I am aware. Or take a more recent example, the Ministry of Fuel and Power. The Minister has had to answer Questions in Parliament on such subjects as the price and quality of coal, and so on. The object of these remarks is to suggest that Parliamentary scrutiny need not be such a hindrance or a nuisance for these great corporations as has sometimes been suggested.

What are we to do about it? I will make, very briefly, a few suggestions. They are not my own; I have marshalled some suggestions made in debates in your Lordships' House and in another place, and by other persons such as those whom I named just now. One suggestion is that there should be a permanent Standing Committee on the Nationalised Industries, which should include members of both Houses of Parliament,with power to examine Ministers and directors of public corporations. I suggest that such a Standing Committee would show good sense, and that there would not be any "badgering." The next suggestion is that there should be a Select Committee of both Houses, set up every three, four or five years, to examine each nationalised, industry—in other words, that each, nationalised industry should come underthe scrutiny of a Select Committee of both Houses once in every three, four or five years; and that this Select Committee should be assisted (this is very important) by the Comptroller and Auditor-General. Then there is the third suggestion for which I myself confess some sneaking liking (I think it was put forward by the noble Viscount, Lord Swinton, in the debate a year ago): that is, that the question of prices and rates charged by these nationalised industries should be investigated by the Monopolies Commission. After all, they are monopolies and as I say, I think there is a great deal to be said for that.

The last suggestion I put forward is that made by the National Union of Mineworkers who, I see, are about to propose that they themselves should begin a probing of the National Coal Board. I like that suggestion beg of all. I regard it as admirable. I hope they will receive proper facilities for their examination. I think that is fine. In case the noble Marquess opposite has not followed me, I will say that again. In the last few days, the National Union of Mineworkers have announced that they think it is necessary that they should have a probe, an examination, an investigation of the affairs of the National Coal Board. I think that is splendid. I think that is something that should be supported, and I hope they will be given every facility. We all know—we have been reminded of it so often in weighty debates in your Lordships' House—that the economic situation of this country is difficult. Obviously, in that economic situation a great deal depends on the nationalised industries. Therefore, their efficiency is more important than it might be in more prosperous times, or when the country was in less difficulties. We cannot afford inefficiency—I use the word in its widest sense—either in relation to labour problems or in regard to the installation of the latest methods of machinery, the best business practices and so on. We cannot afford inefficiency in these great public corporations, and I am sure that my noble friends will agree with that. That being so, I submit to your Lordships that we cannot afford to neglect any means that will ensure this efficiency. It is certainly the direct responsibility of Parliament, as representing the nation, to see that all practical means are employed to this end. I beg to move for Papers.

3.14 p.m.

LORD RENNELL

My Lords. I shall have little occasion to detain your Lordships because the noble Lord has substantially made the speech which I myself should have wished to make. In fact, I think there is very little, if anything, that he said with which noble Lords on this side of the House can find themselves in disagreement. It is particularly on the second part of the noble Lord's speech that I want to add a few words. I do not propose to deal with the first part of his speech about members of this House being on boards. Those of us who have followed the growth of nationalisation—and here, of course, the noble Lord is perfectly right—realise that nationalisation in its present form is only an extension of something which was begun a great many years ago. The nationalisation of dockyards, arsenals, the Post Office and so on are part of our economic history.

It is, however, striking that, under the new dispensation, with the extension of nationalisation, it has been found necessary to depart from the original principle of the direct Parliamentary responsibility of the Minister in charge of whatever it may be—the Post Office, the arsenals or the dockyards. Parliament has been cloaked by the creation of boards, behind which in many ways, I think it is fair to say, and not an exaggeration to say, the responsible Minister has frequently sheltered. It is not only in the nationalised industries to which the noble Lord has referred that this has happened, but it has happened there more particularly. One wonders why, if the Party of which the noble Lord is a distinguished member wished to extend nationalisation, they departed from the principle of direct control and found it necessary to institute boards, and then found it necessary, when the question arose of Parliament calling the boards to account through the responsible Minister, that the Minister should decline to reply to a great many Questions which in former days the same responsible Minister would have answered.

For instance, I take the case of the railways. Before the nationalisation of the railways, there were countless Questions asked in another place about train services, tariffs, rates of pay and development, to which the Minister of Transport replied. Under the present dispensation, those Questions now fall to be the direct responsibility of the British Transport Commission, and the Minister, presumably, in conformity with general principles adopted in other cases, would say that that was a matter in which the Commission were responsible and he left it to them. Therefore, in point of fact, not only have we departed from the principle of Parliamentary responsibility for expenditure in nationalised industries which did obtain, and still does obtain, in the case of the Post Office and the dockyards, but we have departed from it further in substantially abstracting, for instance, railway services from the inquiry by Parliament into what is going on there. So there has been, in fact, a retrogression of Parliamentary responsibilities.

One wonders why and how this happened. It is difficult to answer that question, and, even with the reports that have been made, I find it difficult to know the real answer. There was, apparently, in general a feeling that Departmental direct responsibility for commercial or quasi-commercial activities was not desirable. Apparently, it was felt, and perhaps not only in the Labour Party, that the Parliamentary control to which Government Departments—the Treasury, the Board of Trade and the Ministry of Supply—were subject was not the machine which was best fitted for carrying on direct commercial activities, which must sometimes involve competitive selling and the sort of decisions which are best taken in a public company under private commercial control. If I am right, out of that conception grew the idea that we should have a sort of hybrid. It was born, I think, out of the creation and the development of public boards such as the Mersey Docks and Harbour Board, the Port of London Authority and the London Transport Board. And the development was that, having started with non-profit-earning boards which had, as it were, commercial functions, by a process of evolution those boards could be invested with rather more commercial functions and given profit-earning capacities and competitive activities with other industries. I think that is how it happened.

But admittedly the national boards which we have to-day in the coal, electricity and gas industries, and latterly of course in the iron and steel sphere, have not been very happy. They have neither reconciled the opponents of nationalisation to the idea that a commercial Board or a board of commercially-minded people would run those industries more efficiently than would a department, nor satisfied the employees in the industries concerned. In the last twelve or eighteen months we have had countless examples of that. The noble Lord, Lord Strabolgi, quoted one upon which I want to elaborate a little—namely, the decision of the National Union of Mineworkers to investigate the inefficient running and the expenditure of the Coal Board. We have also had statements made recently by eminent trade unionists in the steel trade. They have observed that as a result of the Iron and Steel Act a number of people are turning up in steel works who appear to know singularly little, or nothing, about steel. Those criticisms, as well as those to which the noble Lord, Lord Strabolgi, referred, come from supporters of the Government side; in other words, the boards which have been created and which were meant to import commercial efficiency in the place of departmental administration, appear in the course of the last two or three years to have satisfied neither the general public, not even those who are supporters of the Government, nor the people in the industry.

There is obviously something fundamentally wrong there, and I submit to your Lordships that, in fact, it is that neither the Minister nor the boards are to-day subject to inquiry, question and criticism. The sentence quoted by the noble Lord who moved this Motion is very revealing—I think I took down the words more or less accurately. He said that they came from a report of the nationalised industries group of the Parliamentary Labour Party in another place, which stated that: there is little or no control of public corporations, apart from Ministerial control exercised privately. Will your Lordships allow me to translate that into commercial terms? It is as if the holder of a large block of shares in a public company was privately exercising control over the board of directors without himself being accountable to anybody. As we know, that is one of the most vicious things that can happen in the conduct of a public company. The person who has that power is accountable to nobody except himself. Without pushing the analogy too closely, have we not something precisely of that sort happening in the control by the Minister over these national corporations? He is exercising control privately. He is not accountable to Parliament, as is the Postmaster-General, to whom we can complain and of whom we can ask Questions when the telephone service from Northampton or Nottingham is not working properly. The Minister in charge of these other nationalised industries is in a position today to shelve that question and to say, "That has nothing to do with me. That is a matter for the board, and the Question cannot he allowed." In other words, he is responsible to no one but himself, except for the ultimate sanction of getting into such trouble with his colleagues that he is asked to resign or finds himself losing the confidence of Parliament, both of which sanctions are commercially quite inapplicable to the problem.

That is the sort of problem that has arisen in discussing the nationalisation Acts in your Lordships' House. It is not satisfactory; it is not the right way to run an enterprise. The noble Lord, Lord Strabolgi was perfectly right when he said that, by and large, we have a very efficient Post Office and postal services. Some of us may not agree that our telephone service is quite as efficient as that, say, in the United States, and I, for one, might argue with him that if it had been left in private hands it would be even more efficient. But let us admit that it is a great deal better than it was. I wonder whether it would have been as good as it is if Questions in Parliament in regard to the telephone service had been ruled out of order. If there had been a Post Office board, with some directors nominated from your Lordships' House—provided, of course, that they came from the right political Party and, naturally, that they remained in close allegiance and did not displease the Government; or, if they did, were prepared to incur the risk of having their appointments terminated—I wonder whether we should have had as efficient a postal service as we have now. I do not think we should.

But if the position is as I see it, that we have a Minister who exercises private control, who is in fact divorced from day-to-day Parliamentary criticism and, if necessary, attack, have we not reached the position of a private shareholder controlling an industry? If we look at the thing perfectly nakedly and crudely in what may be its ultimate absurd relationship, does it not mean that the Minister of Supply is to-day in fact the chairman of the iron and steel industry? Just let us think about that a little. He has it in his power to remove, or not to reappoint, members of the Iron and Steel Board, who themselves, I may say parenthetically, are in a great many cases not very familiar with the iron and steel industry. It may be that the Minister of Supply is more familiar with it than they are. But have we not the position there of a Minister trying to control the holding company of an industry which is far greater in magnitude than the great steel corporations in the United States, without the sanction of his shareholders, without having to go to an annual general meeting and be criticised and, above all, without having any share- holders who have the remedies which they can apply in the course of a year, and before the "post-mortem" to which the noble Lord refers? The chairman of an ordinary company has the constant fear that if something goes wrong in the course of a year he may be called to account. To-day we have a Minister of Supply who is virtually chairman of a steel company of incredible magnitude, who is not accountable from day to day, and who can be criticised only after the damage has been done.

These criticisms, which come from supporters of the Government. show how much disquiet has already been engendered in the very few years that have elapsed since these Bills have become Acts. I entirely agree with everything that the noble Lord, Lord Strabolgi, said about Mr. G. D. H. Cole. I have heard many statements that he has made, viva voce, and I have read many of the things that he has written. He has one of the shrewdest and ablest minds among Socialist economists to-day. But he is not alone in entertaining this fear to which he has given expression. These criticisms from the nationalised industries group in another place, are precisely what have led the National Union of Mineworkers to conduct their own investigation concerning efficiency and expenditure. I agree that that is healthy, and I am all for it; but they are doing something which Parliament ought to be doing and which Parliament would have done in the case of the Post Office and the dockyards but has not been allowed to do here. It seems a curious position that we have got into when a private body—a trade union is, for this purpose, a private body—should have to take upon itself the responsibility for an investigation of the expenditure of monies provided by the public purse, because that investigation has been removed from the ambit of the House of Commons. That is, indeed, a very peculiar position, and one that needs investigation and an answer.

The noble Lord, Lord Strabolgi, proposed three answers or, rather, suggested three courses which would assist in this matter. I submit that there is a fourth, which is much simpler; and that is to make each of the corporations a direct responsibility of the Minister and have him answer Questions in Parliament at any time about the activities of his corporation, just as the Postmaster-General has to do in the case of the Post Office. Had that happened before, I suggest that a great many of the scandals which have taken place—for instance, in the Colonial Development Corporation—would not have occurred. Many of the things that have been, and still are, going on, have been common knowledge to a great many of us.

In point of fact, the Secretary of State for the Colonies has been chairman—though he has not been answerable to shareholders—of fifty-odd enterprises. Hardly a week passes in which something does not happen which would have formed the subject of a whole string of Questions in your Lordships' House, as well as in another place. Can your Lordships conceive what would happen if the Postmaster-General put up a long-distance telephone line between any two points in the United Kingdom, and a wind got up and blew it down? There would be Questions in Parliament—strings of them, day after day. What has happened? The Colonial Development Corporation, through its engineering department, put up a freezing plant in the Falkland Isles and a wind blew the wall down. That is a matter which is immune from Parliamentary inquiry. Is that reasonable? No. The noble Lord is right. This is an impossible position which we have got into, and a cure for it is urgently needed. But a cure for it is also quite simple.

On general policy, investigation of charges by the Monopolies Commission is obviously right, but another and simpler remedy would be to subject the activities of these corporations, whether they have boards or not, to Parliamentary inquiry from day to day—not through a Standing Committee, but through the ordinary everyday activities of Parliament. That, probably, would also deal with one or two rather curious and, as it seems to us on this side of the House, rather disquieting developments. For instance, we see members of your Lordships' House who have "fallen out" with the Government either removed from the boards on which they were servingor, at any rate, not reappointed—I refer in particular to the termination of the activities of the noble Lord, Lord Milverton, on the Colonial Development Corporation, which has been announced in the Press. There is another case which though not strictly analogous, is similar. If a member of a board, because he happened to hold different politi- cal views from those of his Minister, were removed, and the activities of these boards could be called to account in Parliament, Questions would be asked—andrightly asked.

LORD STRABOLGI

Will the noble Lord forgive me for interrupting? The Minister can be questioned on appointments and, presumably, on removals from a board. If the noble Lord will allow me to say so, he should not overstate his case.

LORD RENNELL

Appointments, I think, can be made the subject of questions, but not removals. The Minister will, no doubt, correct me if I am wrong about that. I accept what the noble Lord says; it may be, overstating it, but I do not think it is in this particular case. The principle of calling a Minister to account for the activities of a corporation remains, so far as I am concerned, quite unassailable on the arguments which both the noble Lord and I have put forward. The fact of the matter is—and I refer your Lordships to Lord. Lindsay of Birker's Motion, which was put forward about a year ago—that thought on the control of national industries has developed a great deal since, the first of these post-war Bills was introduced. But there has been no progress in the thoughts of Ministers regarding the way in which these boards should be administered, and I think the time is now overdue when we must completely recast in our minds the shape and form of these boards. For that reason, I, for my part, and I think noble Lords on these Benches generally, very much welcome the Motion which the noble Lord, Lord Strabolgi, has moved in your Lordships' House to-day. I should like to add that I find myself substantially in agreement with everything which the noble Lord has said.

3.28 p.m.

LORD SILKIN

My Lords, I, too, should like to thank the noble Lord, Lord Strabolgi, for having raised this very interesting and important subject, and also for the excellent and skilful way in which he has done it. I may add that I find myself in considerable agreement with a great deal of what he has said. His Motion deals really wit h two distinct subjects. One relates to the question of noble Lords who are members of and take part, in the nationalised industries. The other deals with the administration of those industries. I should like to say a few words upon the former subject, the position of noble Lords who are members of nationalised industries, and on the part they can play in this House. It is a subject that I have had to consider in the past, and I feel quite definitely that, although noble Lords who are members of particular bodies should not take any part in discussions on the subject matters in which they are directly concerned, there is no reason why they should not otherwise take as full and active a part in the business of the House as any other noble Lord.

I feel that there would be something inappropriate in, for instance, the chairman of a new town corporation taking part in a debate on a new town with which he would be directly concerned. It so happens that there are two noble Lords in that position. Incidentally, neither of them is a member of the Labour Party. I should like to stress that none of these appointments was made on political grounds. The appointments were based entirely on the ability of the persons appointed to carry out the job, and that, so far as my own experience goes, is the position throughout. A good deal of discussion on this matter has taken place on the basis that these are Party appointments, and I should like to assure the noble Lord, Lord Rennell, that that is not the case. It sometimes happens that a member of the Labour Party is suited for a particular appointment. On the law of possibility I think we should find that half of them are; but their membership of the Labour Party is not the basis of their appointment. I think the position of noble Lords who are members of these bodies is perfectly clear. They ought not to take part in discussions on matters connected with their own boards, but should be free to take part in any other discussion.

On the general question of the administration of public boards, I could not help feeling that the noble Lord, Lord Rennell, was being driven logically into the argument that it was wrong to have public boards at all; or, at any rate, that it was much better that the nationalised industries should be run by Departments of the State. It seemed to me that the tenor of his argument went in that direction, because in that way the Minister respons- ible could be asked questions about the day-to-day activities of his board. He held out the example of the Post Office and the noble Lord, Lord Strabolgi, instanced the Admiralty, as being ideal from the point of view of public accountability. But noble Lords may remember the debates that took place in connection with nationalised industries. Your Lordships may remember all the pressure from noble Lords opposite, and from Members opposite in another place, in the direction of having people running these industries who understood the industries, had experience of them and were competent business men—and, essentially, that they should not be run by civil servants. That view was accepted, and it was largely for that reason that public corporations were set up. For that reason, also, it was decided to set up public corporations in the new towns, a matter for which I had some responsibility. I think that on the whole that decision was right. No civil servant could have run the steel board, or the boards for transport, electricity or gas. I think they are essentially organisations that should be run by people with knowledge and experience of the industries concerned. That applies even more to the National Coal Board. So we had these corporations set up to run the nationalised industries.

The question then arose of how we were to secure public accountability. I believe that public accountability is vital. The whole case for nationalisation is based upon public accountability. The main argument for nationalisation is that private bodies are not accountable to anybody—they can act on their own sweet will and discretion; and that the public corporation is bound to act in accordance with the public interest, and the public are entitled to know what is being done. Here we have a dilemma. If we accept the position that the public corporation is the best mechanism for running a nationalised industry, how are we going to secure public accountability? It seems to me obvious that we could not set up a public board to run an industry and then interfere in their day-to-day activities—and no one took a stronger line on this point than noble Lords opposite. It is wrong that these boards should be subject to questioning about every action which they take. I know that it happens with the Post Office and with the Admiralty, but I am not so sure that even in these cases it is desirable that that should be so. That not the case in the Imperial Chemical Industries or in any other big private concern. A shareholder does not suddenly sand up and ask questions about a particular day-to-day decision of the I.C.I., and I think it would be quite inappropriate that it should be possible for a Member of Parliament to stand up in either House and ask questions about the day-to-day details of administration of the public boards. I think that that view was generally accepted on all sides of the House.

Then came the question of interpreting that view. Obviously in interpreting it, there had to be a ruling that the Minister responsible should not be subject to questioning in the House. I think that decision was broadly right. But that does not dispose of the matter. I remember some weeks ago listening to a debate on transport, in which a number of noble Lords brought up specific questions of unwarrantable delays in the collection and delivery of goods. The noble Viscount, Lord Swinton, brought up a very involved case about goods which were sent from Bristol to somewhere in the North but which did not get there for many days. I thought then: what is the remedy? How can this sort of thing be brought to the notice of those responsible? in the ordinary way, where there is competition, business can be taken away and put elsewhere: but in the case of a monopoly that cannot be done. We are faced with a dilemma. On the one hand, it seems to me quite inappropriate that a Minister should be subject to questioning on day-to-day matters, but, on the other, there ought to be some way of ventilating these problems.

I think the present machinery is quite inadequate, and nobody, I feel, realises that more than the Government themselves. After all, we are at the beginning of an experimental stage in the development of the economic system of our country: we are feeling our way. In another place some months ago the present Foreign Secretary said that the Government were prepared to go by experience and to modify the system as experience dictated. We are now accumulating a good deal of experience. I hope that the Government realise that rather more public accountability is necessary than exists to-day, even though we ought not to interfere with the day-to-day administration of industry. When we appoint responsible people to run an industry, we should leave them alone and not "shoot" at them all the time, subjecting them to Parliamentary questioning which, let us be frank, is sometimes not directed purely to the efficiency of the industry but is a means of "getting at" the Minister behind the industry. That seems to me to be an impossible position in which to put people.

I should have thought that the various alternatives that have been put forward in this debate were well worth considering. I cannot agree with the suggestion of the noble Lord, Lord Rennell, who advocates day-to-day questioning, but I think the three suggestions of the noble Lord, Lord Strabolgi, are worth considering. I would suggest that at least there ought to be something equivalent to the annual shareholders' meeting of a company, an analogy which Lord Rennell made in the course of his speech; there ought to be a full day's debate in each House on each industry.

VISCOUNT SWINTON

The noble Lord will forgive me for interrupting, but lie has great experience of this subject. When he says that you cannot have day-to-day questions about day-to-day management, I do not think anybody would disagree. The real point is: What is day-to-day management? I should like to put this point to the noble Lord. Obviously, it would be wrong to have a Question as to why the 8.15 train was late this morning; but does he mean that if all the trains over three months are late all the time we should not have a Question today or to-morrow, and that somebody should not have to reply?

LORD SILKIN

My answer to that is that the noble Viscount does not really clear the dilemma. If he agrees that we cannot have Questions as to why trains were late on a particular morning, but that we ought to allow questions as to why they have been late continually for three months, then he is really agreeing that there ought to be a restriction on Questions, and that the line ought to be drawn somewhere. I am suggesting merely that the line might be drawn at a grand inquest on a particular industry once a year—or possibly twice a year, if that is preferable—al which questions of this kind might be raised. But, with respect to the noble Viscount, I do not think it would be appropriate for Questions to be asked in the House even on such a hypothetical question as he has raised; nor does it seem to me that it would be easy to draw a line as to what Questions concern day-to-day administration, and where the matter ceases to be day-to-day administration and becomes something else.

I believe that the right analogy is that drawn by the noble Lord, Lord Rennell, who compared these public corporations with companies. I should be prepared to accept that comparison. I feel that when Parliament has this grand inquest, it ought to be a real one; there ought to be full information given, and adequate opportunity for every member of either House to express views as to the administration of the corporation during the previous year, or half-year if that were thought desirable. It seems to me that that is a better way to do it than to do it by Questions in the House which, as I have said, tend to become political and are not always relevant to the issue.

LORD RENNELL

Has the noble Lord taken into account the essential difference between a national board and a private company? A shareholder in a private company, if he is not satisfied with the conduct of the company's affairs in the course of the year, even before the annual general meeting, and quite apart from any contact he may have with the directors, can sell his shares and get out. We cannot get out of the railways.

LORD SILKIN

I admit that that is a difference. But the noble Lord drew the analogy of a company where, according to him, there was ample opportunity for raising these matters, and I was merely following up his remarks. I suggest that we can put the public corporations in at least as favourable a position, from the point of view of public accountability, as is the private company—indeed, in a more favourable position because, generally speaking, the meetings of private companies are fixed at twelve o'clock, and by a natural process of attrition they tend to finish somewhere about one o'clock, whereas no such limitation exists, at any rate, in the other place, where they can go on as long as they like.

I do not think we have yet reached finality about this matter. As the noble Lord, Lord Strabogli, pointed out, this is not a Party matter. Noble Lords on this side of the House are at least as uneasy as noble Lords opposite about the workings of public corporations and the question of public accountability. I suggest that the time may well have arrived for an impartial, objective inquiry into the best means of securing public accountability. Various suggestions worthy of consideration have already been made in the course of this debate, and others will no doubt be made. I do not think it is possible for a Minister to give a reply immediately. I believe that the best way of dealing with this problem would be to have an inquiry—it might be by the appointment of a Select Committee, or in some other form—which will give the public confidence that the problem of finding the best way of securing the public accountability that we all desire is being seriously considered.

3.48 p.m.

VISCOUNT SAMUEL

My Lords, the noble Lord, Lord Strabolgi, has inaugurated a most interesting debate on two matters, one a minor matter and really domestic to your Lordships' House, and the other a major matter of vast public importance. The two are not very closely connected, except by the fact that both relate to public boards. The first concerns the position of noble Lords who happen to have been chosen for posts, either as chairmen or members of public boards. What is their duty to themselves, to this House and to their board when some question arises directly affecting that particular board? The noble Lord, Lord Strabolgi, mentioned two cases. The first was when a chairman of a board, having resigned, made a personal statement here in relation to his recent resignation. That is not a new or peculiar question; nor does it apply only to chairmen of boards. It is the same issue that arises when any Minister of the Crown resigns, and there is always established by long practice a right in such cases for the Member of the House of Commons or the member of your Lordships' House concerned, if he so wishes, to make a personal statement defending his own conduct. No one would suggest that exception should be made for an ex-chairman of a board, any more than for anyone else holding a public appointment who happens to be a member of one House or the other.

The second was the interesting case that arose in relation to the B.B.C., where the Chairman of the Board, Lord Simon of Wythenshawe, had taken action which had been very much animadverted upon. The course that was taken in that matter is worthy of your Lordships' attention, because it was seriously considered and it may serve as a precedent and patter for other cases. It was then thought—and it was also Lord Simon's opinion—that he ought not to take any part in the general debate upon the propriety of his action. That duty belongs to the Government and to the Minister who was responsible for the Board, and the fact that the Chairman happened to be—he might not have been —a member of this House, does not really affect the constitutional obligations of the Minister and of the Government. Consequently, the debate on the issue was conducted without the participation of Lord Simon; the arguments one side or the other were discussed and the opinion of the House was more or less formed. After the merits of the case had been debated and the Government had made their statement, Lord Simon, by leave, rose and made a personal statement as to the reason which had actuated him as an individual in that particular case.

LORD STRABOLGI

He had no reason to ask leave.

VISCOUNT SAMUEL

Possibly he did not ask leave. I am not sure that he did not begin with some little explanation, but that is by the way. With regard to the general statement, as your Lordships are aware that was carefully considered by the Leader of the House, in consultation with leaders of other Parties, in accordance with an undertaking that he had given in your Lordships' House. A statement was made on March 21 of this year. The noble Lord, Lord Strabolgi, described it as a pronunciamento, but it was far from being that. As one of those who were concerned in its preparation, and as the matter has not freshly been drawn to your Lordships' attention, perhaps you would permit me to read some of the salient features of this statement. The first numbered paragraph says: In the first place, we are agreed that only the Peer concerned can in the last resort decide whether he shall speak in the House on a particular occasion. Therefore, there is no pronunciamento. Every one of us who has the honour of being a member of your Lordships' House has duties and responsibilities and also rights. There is no contitutional authority which can control his action in a case such as this. Paragraphs (2) and (3) say: Nevertheless, we are agreed there are certain general considerations which it would be right that the House and the Peer should take into account. When questions affecting a particular Board or public Boards in general arise in Parliament, the parent Minister"— rather an odd phrase, but we know what it means— and the Government of the day generally are alone responsible to Parliament. The duty of reply rests with Ministers only, and cannot devolve upon members of public Boards who may also be members of the House of Lords. There can be no question of Board members replacing, or usurping the functions of, Ministers and dealing with matters of Ministerial responsibility. In the Commons, of course, the possibility could not arise, because a Member of that House must resign his seat on accepting an appointment of this nature. Paragraphs (4) and (5) say: Further, we agree that it is important that, as contemplated by the Statutes and, in the case of the B.B.C., by the Charter, the Boards shall he free to conduct their day-to-day administration without the intervention of Parliament or the Ministers, except where otherwise provided. If Board members who happen also to be Peers were to give the House information about the day-to-day operations of the Board or to answer criticisms respecting it, the House would in fact he exercising a measure of Parliamentary supervision over matters of management. It would also be difficult for the responsible Minister not to give similar information to the House of Commons. We also agree that there is no duty upon the Board member to answer questions put to him in debate, and that no criticism should attach to any member of a Board who refrains from speaking in a debate…. Paragraph (6) says: Finally, I should like to make it clear that what I have said applies only to debates relating to public Boards. Experience acquired as a member of a public Board will often he relevant to general debates in which the same considerations do not arise, and the contributions of Board members who are Peers may he all the more valuable because of that experience. The noble Lord, Lord Strabolgi, did not take exception to that statement, and neither has any other noble Lord who has spoken. Therefore, subject to any observations which may be made later in this debate, I should imagine that those who are responsible for the preparation of that statement may consider that they have, on the whole, well met the wishes of the House.

Some minor questions arise in that connection. If that is accepted, it is quite clear that it is not obligatory upon any Peer who is connected with a board to speak in any debate relating to his own board. It is no reflection upon him that he either does not attend your Lordships' House or attends without rising from his seat. While not obligatory, it may be permissible for him to speak, but only within somewhat strict limitations, and not in any way infringing the rights which properly belong to the Minister who is specially connected with that particular board.

I should like to add one further observation not dealt with in this statement because it would not have been proper to be dealt with there, but which is, however, relevant, and supports the general course that we thought it right to advise. It is that if the contrary practice were adopted, and if it did become customary for Peers who are members of boards to intervene on debates on that particular subject, and if it were gradually regarded as derogatory to a member if he did not do so, the effect might be to some extent to disqualify members of your Lordships' House for appointments to those boards. It would be said: "Well, so-and-so would do extremely well as chairman of this board or that. The only thing against him is that he is a Peer, and it is very troublesome to have a Peer a member of a board because he is always intervening in debates and it makes his position very troublesome with his Minister and with his colleagues." His presence on the board would not be greatly welcomed, particularly if there were differences of opinion within the board—and such things do happen. If there were a division of opinion, one member holding one point of view would be able to express it publicly in your Lordships' House, while another who did not hold that point of view would have to keep silent. Therefore, I think that while it may be thought that, by taking the course we have, we are denying Peers certain rights that they already hold had we taken the opposite course we might have been imposing upon a perfectly worthy Peer who would be glad to be appointed to one board or another a disability to which he would not otherwise be subjected.

The question of Parliamentary control over the nationalised industries is by no means domestic, but very national; as I said, it is by no means minor, but is of the highest moment. It is also a most difficult question. We are now faced with a new problem in our politics and social organisation: the nationalised industries —new, in effect, because although some nationalised industries are ancient, they stand on a very different footing. The Post Office was mentioned. I had the honour, many years ago—so long ago that it seems almost to have been in a different incarnation—of holding for three or four years the office of Postmaster-General. The Post Office in those days was a highly efficient body, and I have no doubt that, with longer experience and greater knowledge, it is much more efficient to-day. But I do not think its efficiency is proved by the profit it makes; that is wholly at the discretion of the Chancellor of the Exchequer. He puts up the cost of a postage stamp on inland letters, and instantly millions flow into the Exchequer. In so far as the Post Office is merely a tax-gathering institution there seems to me a great misuse of the principles of taxation. To tax communications is one of the worst forms of taxation. To put an extra halfpenny on a letter which costs less than a penny to carry may produce a great profit; but that is due not to the merits of the Post Office but to the exigencies of the situation.

The difference between the Post Office and other industries is that the Post Office is a very old-established and, on the whole, a stabilised industry. It does not often have to deal with any new problems; it is more or less a routine institution. Sometimes, as, for instance, when there was the question of taking over the telephones, which arose while I was Postmaster-General, new problems do arise. In the main, however, it is not a competitive industry in any respect and it is a simpler industry than the others. There is no question of foreign competition or of promoting exports. If you look at the Post Office in itself and then look, for example, at the steel industry, you can see an enormous difference when it comes to questions of Parliamentary intervention in matters of administration.

There is this other general consideration with regard to nationalised industries. They are opposed by many on the grounds that they are too slow in taking risks. They are always fearful of losing public mosey. They have always the disadvantages of bureaucracy and the delay of continuous consultations. It is right, of course, to be cautious, but caution is often carried to timidity. If you have nationalised industries at all you should give them a fair chance as against private enterprise. Parliament having decided to nationalise certain industries, it would be wrong to hinder and hamper their working by imposing restrictions to which private enterprise is not subject. If you were to have day-by-day or week-by-week, or, as the noble Viscount, Lord Swinton, said, six-monthly by six-monthly inquiries, and were to go into the question of why there were delays on the railways or in the building of a wall in Stornoway, you would cause confusion among local officials. They would be conscious of the fact that any mistake would be, or at any rate might be, ventilated in Parliament within a week or two. They would be very unfairly handicapped in comparison with industries under private enterprise.

A shareholders' meeting was given as an example. But no director ever thinks of a shareholders' annual meeting unless in the event of some great issue or some crisis, and the average shareholders' meeting may be attended by fewer shareholders than the number of directors at the board table. No, my Lords, that is not the answer to our problem. I should strongly deprecate any line being taken such as that suggested by the noble Lord, Lord Rennell: that the right form of control is by Parliamentary Question and Answer, month by month and Session by Session. A Parliamentary inquiry from time to time is quite a different matter; but, here again, if inquiries are too frequent you have the same lethargic effect: the industry will always be looking to see what is to happen at the next inquiry. I have, indirectly, had some experience with regard to that as a member of the General Advisory Council of the B.B.C., into which an inquiry has lately been held. Those inquiries take place as a rule only once in ten years. When they are made they cause an upheaval within the organisation. Many matters are held up until the report of the commission of inquiry has been received; and, in general, a great part of the attention of the officials is devoted to the inquiry. This is a hindrance to the smooth working of an industry, not only during the inquiry but long before it and for some time after wards. The noble Lord, Lord Silkin, suggested inquiries every year or even every six months. I think that such a course would be open to the greatest possible objection. That really would be interference with the day-by-day conduct of the industry.

LORD SILKIN

I was not referring to an inquiry of the nature suggested by the noble Viscount. I was thinking of a debate in the House.

VISCOUNT SAMUEL

I think the noble Lord used the expression "a grand inquest."

LORD SILKIN

I took that from another source. It was really a debate was thinking of.

VISCOUNT SAMUEL

Anyway, a grand inquest every six months is not being pressed; but, at longer intervals, something of the kind might possibly provide a solution to our problems. I agree with the final words of Lord Silkin. He came to a conclusion which I also was going to suggest. The matter is one of great difficulty and complexity, involving wide issues which ought to be examined thoroughly and at leisure, and it is impossible for those of us taking part in this debate to-day to come to any definite conclusion. That is my own feeling; some of your Lordships may hold a different view. But there should be, now that some of these industries have been nationalised for a few years, a specific inquiry into the relations between Parliament and the Government and these industries; and this inquiry should, I think, be a Parliamentary one. It is not the business of some outside body to suggest what are the duties of Parliament. Therefore it should probably take the form of a Select Committee; and the machinery of a Joint Select Committee would seem to be the best.

In the early days of my Parliamentary experience, I saw that Select Committees and Joint Committees were constantly being appointed. Every year two or three Committees would be appointed to inquire into some specific question. They took evidence—and they had very wide powers of obtaining evidence. As long ago as 1909 I was Chairman of a Joint Committee of the two Houses, whose task was to inquire into the censorship of plays —a Committee which aroused a great deal of public attention. Nowadays there are few such inquiries, and such as there are are almost all conducted by departmental Committees or Royal Commissions nominated by the Government. That is, perhaps, another example of the undue subservience of the Members of the Houses of Parliament to the Executive of the day. I think it would be quite a good thing if your Lordships, from time to time, when some question aroused special attention and you had not adequate information to enable you to come to a conclusion, appointed a Select Committee, without inviting the consent of anybody at all, and made your own inquiry, had your own reports and formed your own opinions. Possibly this question of the future course of policy with regard to the nationalised industries might well be proceeded with along those lines —your Lordships not, of course, acting alone, but with the other House of Parliament.

4.21 p.m.

THE MARQUESS OF SALISBURY

My Lords, I intend to say only a few brief words to your Lordships this afternoon, since the points which I had proposed to make have already been fairly fully covered. The noble Lord, Lord Rennell, from this side of the House has dealt with the first part of the Motion of the noble Lord, Lord Strabolgi, and I do not propose to trench at any great length on that ground, though I should like to say a few words at the end of my remarks. It is the second part of the Motion which deals with the position of noble Lords who are members of this House and who happen also to be chairmen or members of nationalised boards, on which I wish to speak. No doubt, that is a difficult subject, and I think all of us realise it. It was for that reason that the Leader of the House asked the noble Viscount, Lord Samuel, and myself to discuss the position with him. Our discussions led to the statement of March 21, to which reference has already been made. If your Lordships will allow me to say so, I personally do not complain that the noble Lord, Lord Strabolgi, should have raised the matter again. It is clearly a new constitutional position in which we have to find our way; and the more we discuss it the better.

I do not think that I have a great deal to add to the statement of March 21, especially as it has been referred to in considerable detail by the noble Viscount, Lord Samuel. I would most certainly agree with him that it was not intended to be, however it appeared, a pronunciamento. That is the last thing in the world that it was. The leaders of every Party in this House recognise that we have no right to dictate to Peers in any part of the House what their attitude should be: that is a matter for them. As hereditary Peers, they have their constitutional rights, and they have, indeed, their constitutional responsibilities, and no one but themselves can interpret those responsibilities. What we can do, and what we try to do, is to give advice, with such joint experience as we have, as to the broad lines which Peers might take. And I think that is as far as we can properly go.

That view was expressed in the statement of March 21. Broadly speaking, as I see it, what it comes to is that a Peer who happens to be a member or chairman of a board cannot be challenged in this House as to the day-to-day running of the industry in whose control he plays a part. It would be intolerable if a Peer sitting in this or that part of the House happened to be a member of a board and somebody were able to get up in this House and challenge him on small day-to-day details. That would be both impracticable and undesirable. But, in my view, a Peer is not inhibited from making such contribution as he thinks proper, even on the subject of a board of which he is a member, for the purpose of removing misunderstandings or misconceptions as to the general policy of the board. I did not entirely agree there with the noble Lord, Lord Silkin, who I think felt that he ought not to speak at all on such a subject.

After all, the purpose for which noble Lords sit in this House is to be helpful, helpful not only to the House but to the country generally. They may possess specialised information which may be useful to the House, which does not in any way give away secrets of a board or prove to be in any way embarrassing to it. On the contrary, it may be helpful to the board that the facts should be known, and in a case of that kind I should have thought that a Peer was fully justified in making such a contribution as he thought right. The noble Lord, Lord Strabolgi and the noble Viscount, Lord Samuel, referred to the statements—in fact the only two statements that we have had by members of this House who are also members of boards—made by the noble Lord, Lord Simon of Wythenshawe, and the noble Lord, Lord Trefgarne. I should regard both those statements as irrelevant to our discussion to-day, because they were intended to be personal statements, although in one instance the noble Lord concerned went a bit far. I hope that in due course other contributions will be made. I do not believe that those contributions need conflict with the advice which the leaders have given, and they may well be extremely useful to the House. That is all I want to say on that issue.

And now a word on a subject on which I cannot pretend to be an expert—that is, the administration of nationalised industries and their relationship to Parliament. How is Parliament to keep some control over the nationalised industries? In raising that question, I find myself in great sympathy with the noble Lord, Lord Strabolgi. I would say this, however—though it may perhaps be regarded as a repetition of what has already been said: If these industries were privately run, the ultimate control would he in the hands of the shareholders. The noble Lord, Lord Silkin, said that in such cases, the directors were accountable to no one. I do not think that is an accurate description of the situation. The directors are accountable to their shareholders and they must be so. The companies hold their annual meetings, and at those meetings the shareholders can criticise the directors and, if necessary, can remove them. The noble Viscount, Lord Samuel, said, quite truly, that, in the vast majority of cases, they are very quiet and unobstrusive meetings. Very few shareholders turn up and, on the whole, things pass through as a mere formality. That is entirely true. But the fact remains that, if they like, the shareholders can turn up in force, and they can out-vote and, if necessary, dismiss the directors. Alternatively, of course, as the noble Lord, Lord Rennell reminded your Lordships, a dissatisfied shareholder can sell his shares and get out of the concern altogether.

But once an industry is nationalised, the shareholders become in effect, as noble Lords opposite have often reminded us, the British people. They cannot sell their shares; they cannot get out of the concern. How are they to exercise at any rate some control? That is what is worrying them, and that, I am sure, is what is worrying us—I do not say merely on this side of the House it is a common problem which has to be faced. The natural conclusion would be that it must be done through the elected representatives in Parliament, who are the representatives, for this purpose, of the shareholders. But there is a difficulty which has not been mentioned this afternoon, though I have no doubt that everyone is conscious of it. In an ordinary shareholders' meeting the shareholders are concerned only with the affairs of that particular company. That is why they have come to attend the meeting. In Parliament the elected representatives of the people may spend only an hour or two on any particular industry whose affairs are being discussed. But that is not their only interest. They are there as supporters of a certain Party in Parliament. They have been elected to support that Party on the broadest lines, and they will not be at all anxious to bring about the defeat of their Party, even though they personally may be extremely dissatisfied with the administration of a particular board. Moreover, they are subject to Whips; and nowadays Whips are extremely powerful. I have no doubt that a good many directors of private companies would be in a very much happier position than they are to-day if they could employ a Whip to control the shareholders. Therefore, it is not at all likely, however badly an industry has been administered by a public board, that the directors—who are, ultimately, the Government —will be defeated in another place on this particular issue; and on matters of finance, at any rate, your Lordships would be impotent to take their place in that matter.

In these circumstances, like Lord Samuel, do not know exactly what is the answer to this problem at the present time. It has been suggested that there should be fuller Parliamentary discussion. I think that would be helpful; but I cannot feel that it is the complete answer. Then there has been the suggestion that these nationalised industries and boards should fall within the purview of the Monopolies Commission. In my view, that would be a very good idea. Like most noble Lords in all parts of the House, I do not like monopolies, whether they be private or public, and undoubtedly in the great majority of cases these boards are monopolies: and I should therefore have thought they ought to be subject to the attentions of the Monopolies Commission.

Another suggestion, made, I think, by the noble Viscount, Lord Samuel, was that a Joint Select Committee of both Houses should be appointed to examine this very difficult problem. I like that proposal very much. That is probably the best thing that can be done immediately. If the Government feel that enough experience of the working of these boards and their relationship to Parliament has now been obtained, I do not in the least see why a Joint Select Committee should not be set up to discuss these matters. In any case, I think something should be done to underline the direct responsibility of the Minister concerned. I believe that the noble Lord, Lord Silkin, will agree with that, because he recommended an annual debate, and it is not the slightest good having an annual debate in Parliament, where neither the members nor the chairmen of the boards are represented, unless the Minister is in a position to take full responsibility for the answer which is given in Parliament. At present, there is a rather dangerous tendency for the Minister to unload all awkward questions on the board, and for the board to unload them on the Minister. That is merely human nature. But that is not the way by which Parliament is going to retain control of the affairs of these companies, which are now the responsibility of the British people.

My Lords, it does seem to me—and I hope this will not be regarded as too controversial a remark to make—that it is a fundamental defect of Socialism at present that there is no real control by anybody of the socialised industries. We know that certain of these industries have lost very large sums of money. That may have been inevitable: I am not trying to make a controversial point. But in fact there does not seem to be anybody who can do anything about it, and there does not seem to be any real control that Parliament can exert. I should have thought that that was a matter of as much importance for the Government as for the Opposition, and I hope very much that it is a matter to which they will give very serious consideration. But there is certainly nothing more that we here can do about it to-day. In the meantime, if I may return to the earlier part of the Motion, there is one thing that we on the Front Bench can do—namely, to give advice on the limited matter of the conduct of noble Lords who are chairmen or members of nationalised bodies. That we have tried to do, and in answer to the noble Lord, Lord Strabolgi, we have tried to amplify our advice a little bit this afternoon. I hope he will feel that on the whole we have not done a bad job. But the final decision must rest with the individual Peer, and one can only hope that he will act in the spirit of the advice which we have tried to give him.

4.36 p.m.

LORD CALVERLEY

My Lords, before my noble friend replies, I should like to speak for a few moments on the first part of this Motion, which is designed to draw attention to the position of Parliament with regard to the administration of nationalised industries. I, for one, am very glad that Lord Strabolgi has raised this matter, because there can be no doubt that there is grave dissatisfaction in the country at the increasing remote control of some of our nationalised industries. I hope that His Majesty's Government will take this matter very seriously indeed, because, if they do not, and if they shut their eyes to what I agree is a very difficult problem, there is trouble in store for these nationalised industries.

Only yesterday, in going through my newspapers in the north before coming down here, I noticed a spate of letters complaining about the railway services and electricity supplies; and even coal comes in for a lot of criticism. All the while the average member of the public (and I speak here just as an ordinary member of the public) feels a sense of great frustration, because he does not know upon which door he should knock in order to get an adequate reply to any reasonable complaint that he may have.

I agree that this is going to be very difficult. Already the miners are taking direct action. They have appointed their own committee of investigation and the Coal Board will be compelled to give them every facility, because the miners are so powerful. But sometimes it is rather a different matter when it comes to the ordinary members of the public. Lord Strabolgi has mentioned the railways and the implied threat of the secretary of the National Union of Railway men—

LORD STRABOLGI

If my noble friend will forgive me, I gather, from the lengthy reports in the papers, that Mr. Figgins did not make any sort of threat at all, only a complaint.

LORD CALVERLEY

I should have used the word "complaint." Mr. Figgins has made so many threats during the past few months that we have become used to associating him with threats. However, on this occasion it is a complaint. But in the oil days, especially in another place, if a railway Bill was before the House one had only to say "I object." I remember one Member for Rugby (I have forgotten his name: I was quite young at tile time, but I know that he had a Biblical name) who always objected to every railway Bill until he had made the directors of the railway company promise to provide third-class sleepers. In the end, he won his point. Now, two of the principal chambers of commerce in the West Riding are asking the Railway Executive just for one railway sleeper, and they can take evasive action, saying simply, "We have received your letter, but nothing can be done," or "It shall receive due attention."

In the case of a genuine complaint by the public, we should know where to go for redress; and a Member of Parliament should have the opportunity, not once in ten years, or even once in twelve months, to be able to raise what he considers to be a genuine complaint. I should like to put down a Question about this railway sleeper for Yorkshire. I suppose that if did the Clerks at the Table would say: "It is out of order." I do not know for certain whether that is the case; anyhow, I will try [...] on. But what I want to emphasise to my noble friend who is to reply to this debate is that it is no use the Government attempting to shut their eyes to this problem, or to think that they can "get away with it." If they do so, sooner or later there is going to be a storm in which this Government, for which I have a warm affection, will be involved. And I do not want this Government to get into any trouble that they can possibly avoid. But my noble friend and his colleagues are simply asking for trouble if they take the sort of evasive action which has been taken by the railway authority, the Electricity Board and one or two other bodies, simply because they think they are safe behind barriers. In Yorkshire we have some very fine memorial gates. They are beautiful gates of wrought iron and gold, and they have been set up in order to perpetuate for ever the memory of men who feel their names ought to be immortalised just because they have been permanent officials and have held office for two years or so. I mention these matters because I think—and the letters to the papers that I have mentioned testify to the fact that the general public think so too—that the Government have got to apply themselves to a very difficult problem.

4.43 p.m.

THE CHANCELLOR OF THE DUCHY OF LANCASTER (VISCOUNT ALEXANDER OF HILLSBOROUGH)

My Lords, I must say at once, with regard to the second part of the Motion which my noble friend Lord Strabo1gi has moved and which he dealt with first in his speech to the House, that I am sorry that be noble Viscount, Lord Addison, the Leader of the House, is not himself here to answer that part of the noble Lord's speech. I regret his absence because, as Leader of the House, the noble Viscount had so much to do with the settlement and the agreed statement which was made and to which the noble Lord has referred. Also, Lord Addison has had vast experience of these matters and of the procedure of this House, which I, who am still a learner in view of my short stay here, certainly lack. I am still quite a new member of your Lordships' House.

Lord Strabolgi, referring to the statement that the noble Leader of the House made after discussion with the Opposition Parties, rightly pointed out that it arose out of a debate which had taken place on the issue relating to the broadcasting of the play Party Manners. It was then suggested that there should be conversations about the position of Peers who were members of public boards when the House of Lords debated matters affecting the activities of the boards. Neither of the Peers who were connected with it is in his place at the moment, but noble Lords will recall that that statement was based on memoranda exchanged at the time, as well as upon the actual discussions which took place. I should like to make it clear, from my study of the matter from that point onward, that my noble friend may rest assured that there can be no question at all of gagging Peers. The statement made by the noble Marquess, Lord Salisbury, a few minutes ago, I think clearly demonstrated that to the House. On that point he is as much in agreement with the noble Viscount the Leader of the Liberal Party in your Lordships' House as he is with the noble Viscount, Lord Addison, the Leader of the House.

We all agree that only the Peer concerned can, in the last resort, decide whether he shall speak in the House on a particular occasion, and I am sure it can be taken for granted that he will thoroughly weigh his responsibilities in making up his mind. It is not, of course, a question of his personal wish, or even of the contribution which he can make to the particular debate, for there are wider considerations which he must take into account. This is certainly the case when the House is discussing affairs of a body to which a Peer has been appointed by a Minister and in respect of which the Minister is responsible to Parliament. It appeared to the Government and, I think, to the Opposition Leaders, that it would help the House if they had before them some of the considerations which it seems right that not only the individual Peer but the House as a whole ought to bear in mind. The starting point is that a Peer's speech in a debate about his own board may affect the relationship between boards, Ministers, and Parliament, and there are two main dangers to guard against. First, nothing should be done which might impair the responsibility of Ministers to Parliament. Second, nothing should be done to prejudice the freedom of the boards from meticulous political supervision of their day-to-day management.

As for ministerial responsibility, Ministers, and only Ministers, are responsible to Parliament for the way in which boards are conducted. The responsibility of chairmen and members of boards is to the Minister by whom they are appointed and by whom they may be removed. There seemed to be just a shadow of doubt on that latter point, I thought, in the mind of the noble Lord, Lord Rennell, and I wanted to make the matter clear. Anything which weakens the responsibility of a Minister, ipso facto weakens the authority of Parliament. Parliament can control Ministers, but it has no direct authority over the members of the public boards. It is important, therefore, that a member of a board should not be expected to assume a rôle in accounting to Parliament which is proper to the parent Minister. I was going to make some further remarks on the subject of how that works, but that matter has been so fully covered in what the noble Viscount, Lord Samuel, has said, that I do not think need say much more in detail about it. It is clear that each Peer will decide for himself, and I am sure that when he is reaching his decision he will keep before his mind the general public interest and the views expressed in the statement of March 21. But we cannot have any question of forbidding anyone to speak. Each Peer is free to decide for himself inside those general principles, and I am sure that that would be the general wish of the House.

VISCOUNT SWINTON

Will the noble Viscount forgive me for interrupting? I want to make this clear. I am sure the noble Viscount will agree with me—I do not think it has been mentioned but it was in the statement—that the fact that a Peer decides for himself to speak in a particular debate must in no way be regarded as a precedent binding another Peer who is a member of a board to speak in another debate.

VISCOUNT ALEXANDER OF HILLS BOROUGH

I think that that is quite an important reminder of the conclusions covered in the statement which was agreed to by the leaders of all Parties in the House. It is essential that that should be kept in mind. Of course, in a House constituted as this House is, in which every Peer is free to make his own decision, it would be improper to regard anything of the kind as a precedent.

I now turn to what I agree with the noble Marquess, Lord Salisbury, is much the more important part of Lord Strabolgi's Motion—the question of Parliamentary control of public boards. It would be foolish for anyone on the Government side of the House to suppose that this matter was not one of widespread interest and the cause of some anxiety. In many directions there is general concern as to what is the best thing to be done with regard to the developing position in socialised industries in relation to public accountability. Perhaps this concern arises because of the strong political feeling of the individual citizen with regard to the services provided by nationalised industries. There is a great deal of political feeling in the matter on both sides—I am not going to attach it to any particular Party. Perhaps there was not so much feeling about public accountability in regard to the public boards which were set up before the war. I have had my attention drawn to a pamphlet, entitled Accountability to Parliament, published last year by the Acton Society Trust and which no doubt many of your Lordships have seen. That publication says: Gordon, in his The Public Corporation in Great Britain, noted (in 1937) that the Central Electricity Board had only once been the subject of any adjournment motion, that ministers had 'consistently refused to divulge information about the Board beyond that published in the annual reports and accounts in reply to questions in the House,' and that the Chairman of Committees had ruled that the Board could not he discussed on the annual Ministry of Transport Vote 1. Parliament had even less chance of discussing the London Passenger Transport Board since the minister's powers over this corporation were more restricted. Therefore the problem, although it has developed with greater urgency and over a wider area now than was the case before the war, is not a new one. No doubt those responsible for setting up the Central Electricity Board and the London Passenger Transport Board had in mind the points so ably made by the noble Viscount, Lord Samuel, this afternoon—namely, the need to secure the greatest possible efficiency by not having interference with the day-to-day management and not having these boards working under less favourable conditions than would generally be accorded to private enterprise. I have no doubt that the Ministers who drew up the plans for the Central Electricity Board and the London Passenger Transport Board, who were of different Party views from the present Ministers, had all those things in mind.

Reference was made, especially by the noble Lord, Lord Rennell, to the public accountability secured in such cases as that of the Post Office. Here again I almost hesitate to say anything because of the ability with which a former Post-master-General commented on this subject this afternoon. Reference was also made by the noble Lord, Lord Strabolgi, to the Admiralty, in which both he and are interested. The Postmaster-General, the First Lord of the Admiralty, and the Minister of Supply for the ordnance factories, give the orders. They get advice from their senior departmental officers and departmental committees, but they are responsible for the final instructions. They are responsible for the day-to-day administration of their Departments. But that is an entirely differentposition from that which has been deliberately adopted by Parliament in regard to the nationalised industries, where the boards, and not the Ministers, give the orders. I feel there was a great deal in the points put by my noble friend, Lord Silkin, who has had experience in setting up these boards, since the war, and I would accept a great deal of his advice. But I am not at all sure that at this stage I agree with his suggestion of a grand inquest which is to resolve itself into an annual, or perhaps monthly, debate in Parliament. The general considerations which he put with regard to the conditions under which a board should work, however, were very valuable.

Any new departure on the line of the noble Lord's Motion would require careful study. It would involve legislation, because the present position is based on the strict definition of the powers of the Ministers under the Statutes which have established these boards. The position is the same as it was last October, when this matter was debated in another place and the present Foreign Secretary made a statement which has been referred to in your Lordships' House to-day. If we look at the statement he made then, which. I do not propose to read in detail We shall see that the accountability of Ministers is enlarged by questions in the House, by debates on the Adjournment and on. Supply, by Private Bills, by Prayers, and by actual direct contact with the boards.

I suggest to my noble friend, Lord Strabolgi, that he might have another look at the extent to which there is opportunity of checking the policy of Ministers responsible for nationalised industries and for raising matters connected with the efficiency of the boards.

The Government have never sought to lay down rigid rules. They have allowed Parliamentary practice in regard to the boards of nationalised industries to evolve empirically, and significant developments have occurred in the light of experience. There was, for example, Mr. Speaker's ruling on June 7, 1948, when, with the full concurrence of the Government, he said that he would be prepared to pass Questions raising matters of public importance, notwithstanding that they arose out of the day-to-day responsibilities of the board. But, of course, there is a special procedural rule through Mr. Speaker by which that system can be properly checked. Members of the other place have taken advantage even of Second Reading debates on Private Bills promoted by the British Transport Commission to ventilate matters of management, and the use of the Motion for the Adjournment for a similar purpose continues to grow.

I would assure my noble friend Lord Strabolgi that the Government are prepared to listen sympathetically to any other proposals which may be put forward. We feel, however, that there are serious objections to the proposed permanent Joint Select Committee for national industries to which he has referred. Where policy is subject to a detailed Parliamentary scrutiny, it must be justified from financial and other aspects, not only in the long run but also in the short run; every step taken must be justifiable in itself. It is not easy to run commercial undertakings on these lines, and still less easy to justify the setting up of public boards if the work is to be scrutinised in that way. Business men are not accustomed—at least, not all of them —to appearing before a Select Committee and answering for the running of their businesses, and it would take up a great deal of the time of the chairmen and other members of the boards and their principal officers. I hope that it will not be taken too hardly if I say that, with the establishment of a Select Committee, there would be a tendency on both sides for a good many of the Questions to be of a political character, rather than Questions asked from the point of view of achieving the greatest efficiency in the business.

We are in agreement with the suggestion made by my noble friend Lord Strabolgi that there should be periodical inquiries into each nationalised industry. We are not quite so willing to agree to the suggestion that these periodical inquiries should be conducted by a Joint Select Committee. I rather gather that the noble Viscount, Lord Samuel, was fairly well disposed to that part of Lord Strabolgi's suggestion, but my own view—I do not presume to speak for anybody else, not having had consultations since the debate arose—is that it would be premature at this stage to have a Joint Select Committee for that purpose. I think we shall see more clearly in a year or so what is the best method to adopt.

THE MARQUESS OF SALISBURY

The noble Viscount has made an interesting suggestion about periodical inquiries, but he has not said who would carry them out.

VISCOUNT ALEXANDER OF HILLS BOROUGH

I think the Government are already convinced of the need for a periodical inquiry, but I feel it would be premature for me to say anything further as to the form of such an inquiry. I spoke only for myself when I said that I doubt very much whether a Joint Select Committee would be the best form. It might possibly be that kind of departmental Committee upon which people other than officials could serve.

VISCOUNT SWINTON

The purpose of a Joint Select Committee would not be to investigate these individual corporations, but to consider the best method by which they could be investigated, which is quite a different matter.

VISCOUNT ALEXANDER OF HILLS BOROUGH

I have been trying to marry the general view expressed by Lord Strabolgi with the general approach to the basic principle of the Joint Select Committee mentioned by the noble Viscount, Lord Samuel, and I should be the last to wish to misinterpret him. As to the form of the regular periodical inquiry, I feel that it would be an exceedingly good thing for the submission made by the noble Viscount, Lord Samuel, to be further considered by the Government, to see whether the question of fixing the form of periodical inquiry should he entirely one ab initio for the Government to announce, or to submit to Parliament, or whether it should follow a preliminary Parliamentary study of the kind which has been suggested.

LORD STRABOLGI

My noble friend will forgive me if I interrupt. I am most encouraged by the fact that the idea of a periodical inquiry commends itself, but the most important suggestion in connection with that proposal is that whoever undertakes the inquiry should be assisted by the Comptroller and Auditor-General. Has that been considered, too?

VISCOUNT ALEXANDER OF HILLS BOROUGH

I think so, but it is not at all certain that in the kind of wide range of operations of these vast boards—the railways, iron and steel, and coal, for example—it would always be possible for them to be adequately covered by the Comptroller and Auditor General. To find exactly the right person for the kind of inquiry that my noble friend has suggested would be a most difficult matter. On the other hand, it occurs to me—at the moment I make no statement for anybody other than myself—that there might be an inquiry by what would usually be regarded as a departmental Committee, but which would also include independent people—those qualified for the different functions to be covered by the inquiry—and, therefore, run on an entirely satisfactory basis. On that I make no final statement at all.

What I do say, however, is that in regard to these vast undertakings it is quite impossible to contemplate inquiries of this sort at very short intervals; one cannot continuously be pulling up these great organisations by the roots to see how they are getting on. On that I gather that the noble Viscount, Lord Samuel, agrees with our point of view. My right honourable friend the Foreign Secretary, when speaking about this matter in another capacity last October, suggested seven years as a possible period which Parliament might be willing to approve for this kind of periodical inquiry into these large and important undertakings. I suggest that that is certainly something for us all to confer about and consider. Each report from such an inquiry would be presented to Parliament, and would then be debated. If I may say so to my noble friend Lord Silkin, that would be the best day on which to have the kind of debate that he thought might take place annually. Such inquiries as we have been proposing would, therefore, represent a further step forward in the direction of public accountability.

I conclude by saying that, while I may not agree with every word that Lord Rennell said, or with every facet of the comments of the noble Marquess, I agree with a large amount of the speech of the noble Viscount, Lord Samuel. Irrespective of Party, we are all anxious that these boards should be brought to the highest pitch of efficiency and of the greatest service to the people. From that point of view the House may rest assured that we shall give every possible attention to the matter to see how we can implement in the best possible manner these inquiries about which we have been speaking.

5.10 p.m.

LORD STRABOLGI

My Lords, I am most grateful to my noble friend, not only for the substance of his reply, but for his sympathetic attitude. I do not propose to press for Papers, because such a volume of Papers has already been issued containing these tremendous and monumental reports of all these Corporations. I found the greatest difficulty in lifting up my bundle in my office in preparation for this debate. In view of the paper shortage I do not intend to press for more printed matter. We have reports in abundance. Perhaps my noble friend will allow me to make one point, and also one comment or what the noble Marquess, Lord Salisbury, said, before I ask leave to withdraw my Motion. This departmental inquiry with outside members, which my noble friend Lord Alexander seems to favour, or apparently the Government seem to favour, does not involve Parliament at all, except that, when the report is made—a voluminous report—we should then have what my noble friend Lord Silkin calls the grand inquest, with a great many members who do not know the details debatingthe report. Whereas if we have a Joint Committee, of Parliament, the men who have heard the evidence and gane through the, documents and so on, can tell Parliament directly whether or not there is anything wrong. That is the value of the Parliamentary Committee. That is democratic, and I press my noble friend to reconsider this matter.

VISCOUNT ALEXANDER OF HILLS BOROUGH

I was speaking solely for myself. I was speaking as to the possible alternative forms of inquiry. I was saying merely that there were certain alternatives.

LORD STRABOLGI

That is why I am so hopeful—my noble friend is in a flexible state of mind. A departmental Committee of outside members will not satisfy us, because there is always the suspicion underneath that "Dog does not eat dog". If you set up a committee of civil servants to inquire into the doings of other civil servants or semi-civil servants, the public will not be satisfied. I am sure it was my fault, but I think the noble Marquess, Lord Salisbury, misunderstood me. When I was talking about the position of Peers who are chairmen of these boards and so on, I was not for a moment suggesting that they should be subject to an interrogation by your Lordships on the working of their boards. What I had in mind was this, and I still think there is a great deal in it. Supposing that we are having a general debate on transport—and no subject is more important, in the present economic state of the country—would it not be advantageous to hear the views of my noble friend Lord Hurcomb if he were prepared to intervene? I cannot imagine that he would say anything at variance with what the Minister read out from his official brief.

THE MARQUESS OF SALISBURY

I think that point was covered by what I said. I said that I did not agree with the noble Lord, Lord Silkin, that in no circumstances could a Peer intervene on a debate on his own subject, but that he would have to act with due discretion. He should not be the representative of his board in this House. That is what I think would be wrong.

LORD STRABOLGI

I am glad that the noble Marquess is exhibiting the hereditary tendency to safeguard the rights and prerogatives of the Peers, and I most humbly support him. The other example of this sort of thing occurs with civil aviation. The idea that my noble friend Lord Douglas of Kirtleside should sit here dumb and silent, when I suppose he is the greatest authority we could have on the question, because of his Service and civil experience, is, I think, grotesque; and the idea that he would say something at variance with Ministerial policy is also grotesque.

THE MARQUESS OF SALISBURY

I would not accept that.

LORD STRABOLGI

I know the views of the noble Marquess. As for my noble friend Lord Alexander's remarks on this matter, so far as I can gather he says that these noble Peers on national boards can do what they like, but if they do they will be sacked. I beg leave to withdraw my Motion.

Motion for Papers, by leave, withdrawn.