§ 2.40 p.m.
§ LORD LUCAS OF CHILWORTH rose to call attention to the Transport policy of Her Majesty's Government, as set forth in the recent White Paper (Cmd. 8538); and to move for Papers. The noble Lord said: My Lords, before the noble Earl, Lord Onslow, rose just now I was on the point of congratulating the usual channels at having cleared the track of all the obstacles and set the signals at the right colour so that we can now go ahead; but evidently they have had to make some arrangements in the catering department. I do not think it is necessary for me to make many introductory observations upon the Motion which 1026 stands in my name upon the Order Paper. The number of noble Lords who have put their names down to speak is itself evidence of the importance of the subject.
§ It has been said that this afternoon in your Lordships' House there will be fired the first shots in what will be a long and bitter battle. I can assure your Lordships that, so far as it rests with me, there will be no bitterness. I shall have some sharp criticisms to make, and some very blunt questions to ask; but I trust that I, at least, shall be able to say all these things with that courtesy which usually we all try to observe in your Lordships' House—the more so because I have such a high regard for the noble Lord who is to reply on behalf of the Government. In my opinion he has always been one of the leaders of British industry—a man who has risen to the heights in our industrial world along the hard way. Therefore, so far as I am concerned, if this debate tends to devolve rather into a discussion between two business men, I hope that that will not be uncongenial to your Lordships; in fact, I think: most noble Lords would find themselves very much at home in that atmosphere.
§ I think I can get right to the heart of this matter straight away. The policy, if policy it can be called, set out in this White Paper, is the complete overthrow of any thought of integrating, unifying, amalgamating—call it what you will—the rail and long-distance road haulage system of this country. The Government's policy, set out quite clearly, is to return to the bitter and intense warfare of the past between road and rail, hoping that in time and from the strife there will emerge something of a policy, which will save Her Majesty's Government the trouble of thinking about one. It is a frank admission that Her Majesty's Government made no study of transport economics throughout the time they were in opposition. They have no real policy; they really do not know what to do. The policy set out in this White Paper will settle nothing. It will not provide any solution to the problem that has been worrying all thinking people for years past. In fact, it is a complete negation of Government responsibility to the nation, to Lie taxpayer and to those who are employed in this great industry; it throws overboard all the opinions expressed and all the advice given for years and years by anyone who 1027 had any right to be classed as an authority on transport, including a long succession of Committees and Royal Commissions, and an even longer succession of Conservative Ministers of Transport, including the noble Lord, the Secretary of State.
This is what, in the words of this White Paper, is called:
A positive approach by new and constructive legislation.
But it is what The Times newspaper has said to be not even a policy, not even a sketch of a picture of a policy, and certainly no basis for legislation. The Manchester Guardian, after what I thought was a very trenchant leading article, said:
This is transport politics in terms of 'Let's pretend '.
I thought that a very adequate summing up.
§ I want to-day to ask the noble Lord, Lord Leathers, three main questions. I have given the noble Lord notice that I was going to ask these questions, so perhaps he will be able to answer them, though two have already been answered. First, I would ask what were the grounds upon which the Government came to the conclusion that there was no alternative to the complete disintegration of road and rail long-distance haulage as set out in this White Paper. My second question is: Before coming to this conclusion, did the Government make any investigation into the affairs or the operations of the British Transport Commission, the Road Haulage Executive, and British Road Services—any one or all of them? My third question is: Was there any consultation at all between the Government and the British Transport Commission before this decision was arrived at?
§ The answer to the first question I shall await with interest. The answers to the other two, or to the third one, were given by the right honourable gentleman, the Minister of Transport, in another place when he said: No, there had not been consultation, but that there were now going to be some talks, the nature of which, I gathered, was that the victim was to be consulted as to the funeral arrangements. But there was no investigation at all into the operations and the affairs of a concern in which £80,000,000 of the public property was at stake. It really is to me, as a business man—1028
§ LORD LUCAS OF CHILWORTH
I do not know whether that interjection was meant for the purpose of obtaining information or whether it was an effort of sarcasm.
§ LORD LUCAS OF CHILWORTH
To me as a business man it is unbelievable that consultation did not go on to find out what was right and what was wrong—that there was no consultation with the experts concerned. The decision of the Government was this: we do not like the present set-up and we think it is wrong; we have no proof and so we are going to put up for public auction to the highest bidder, without reserve, £80,000,000 worth of the taxpayers' property, and by so doing endanger the security of the £1,200,000,000 worth of issued capital of the British Transport Commission. With the best will in the world I just cannot understand it. Lord Leathers' worst enemy would never call him a scheming politician; his worst enemies, who are few, and all his friends, who are legion, would pay high tribute to his great business ability, as I have already done. Therefore I know he will not think the question I now address to him is unfair.
Would the noble Lord if he had been sitting in the board room of a private or a public company and this £80,000,000 represented shareholders' money and not taxpayers' money, have done the same? If he had, I can make the unhappy guess that he would have been out in the street "on his neck," and perilously near the county gaol. Of course, he would not have done that. He would have brought together all the people concerned and perhaps told them, "I do not like you. I do not like your fit-up. I think you have made a real hash of this. But tell me what has gone wrong. What have you done and what have you not done?" Surely the first thing he would have done would be to acquaint himself with the facts. But he did not even lift the telephone and ask a question.
Whom did he consult? He might have consulted a few ex-railway directors, a few of the "Old Guard." I make no complaint about that. They could have given him some information, if a little 1029 out of date. He might have consulted the Road Haulage Association. I make no complaint about that. They would have given him some information from the road haulage point of view. But he did not consult that body of men who, within the organisation of the British Transport Commission, have been working for four years on this problem of integration. These are not men who are steeped in railway technique or in road technique in isolation; they are men who, in a dual capacity, have been running both systems. This is the first time in the history of transport in this country that we have had such a body of men. They are unique. And they have accumulated a great deal of wisdom in grappling with what has proved to be an almost intractable problem.
I do not deny that the co-ordination or integration (whatever we call it) of railway and road transport, which has baffled the best brains for many years, has proved a far more intractable problem than any of us thought. But suppose the noble Lord or I had thrown our hands in at every intractable problem that has crossed our path, where should we have been? I dare swear that the noble Lord has had a few thousands to deal with in his career, as I, perhaps more modestly, have had my hundreds. Did the noble Lord then say, "This is too big for me; I cannot grapple with this"? Would the noble Lord have got where he is now, right at the top of the tree, if he had done that? If I had done it I dare swear that I should have been where I started—sweeping up the shop; and I do not think the noble Lord began his career in industry very much higher. Would the noble Lord have risen from the bottom of the ladder to the top if he had refused to grapple with intractable problems and had quit? Of course not.
A Minister does not find out the facts by sitting in the Ministry of Transport, admirable establishment though it be. I know it; I was there for a long time. I was not an overlord; I was at the other end of the bell-push. To get the facts, you have to go to the men who are actually operating the system. Were the Government afraid of the questions they would have had to ask if they had done 1030 that and of the answers they would have received? Were they afraid that the answers would not fit in with a certain Election pledge? Were they afraid that these non-political people in the heart of the British Transport Commission (they are not of my political persuasion)—I do not mean the heads of the Commission, but the real brains—would say to them that they were convinced that the policy underlying the 1947 Act was correct? Were they afraid that trey would be told that integration, however difficult, was the only solution to the transport economy of this country? Were they afraid that these experts (I do not like the word, but I must use it for want of a better), would tell him they were determined that it could be done and were working to that end?
If the noble Lord had made these investigations, what would he have found? The first thing he might have found was that British Road Services, at the end of the 1951 financial year, showed a profit of £3,000,000—a very uncomfortable thing to be found by any one who wants to present to the public a picture of inefficiency. I am not going to claim that a profit of £3,000,000 proves efficiency, or that it proves anything save that a profit of £3,000,000 was made. The noble Lord might have found out the facts about centralisation. We have had a great deal of talk about excessive centralisation. This talk has been based on ignorance or on hearsay or, in some cases, on a little knowledge. I am not going to claim that there is not far too much centralisation. But the noble Lord knows that when you start to amalgamate a number of companies—and he has done it many times—you have to bring everything into the centre to start with, see what common services you can have, find out what standardisation is profitable and how economies can be effected; and then, when you have clone that, you start pushing the rest out. You have then to try, as he and I have often tried, to find people to bear responsibility all the way from the top to the bottom. The noble Lord knows that that is the secret of successful operation.
If the noble Lord had looked into this matter, he would have found that during the last two or three years £40,000,000 had been saved through standardisation of technical services and their centralisation. 1031 To-day there are about twelve standard engines on British Railways, whereas before nationalisation there were round about 360—I do not know the exact figure. That means a great deal. I need not go into detail: noble Lords know what that means in maintenance, spare parts, and things like that. It is only fair to try to balance the two sides. I do not pretend to give it all to your Lords-ships this afternoon, but what I say in this part of my remarks is that if the inquiry had been made the facts would have been found.
What are the constitutional weaknesses? Nobody of any sense would claim that all the wisdom of the world was ever written into one Act of Parliament. I expect that four years of experience have shown quite a number of defects. They are all there and they could have been ascertained quite impartially, without any political prejudice—I myself may have political prejudices, but I know that the noble Lord has no prejudice and I will not bring him into that side of it. But an inquiry would have proved that a great deal has been going on. There are a number of noble Lords who have had a lifetime's experience of railways, and they know that one of the complaints we have always made is with regard to the lack of real costing knowledge, the lack of real facts, both of comparative economics and costs of operation, on the railways. Wonderful strides have been made in the economic comparisons between road and rail requirements under different conditions in different parts of the country.
All these facts would have been available. Had they been obtained, they would have thrown up the important factor that in this modern age, with modern industry developing along the lines it has, where the insistence by industry and individuals is for a door-to-door conveyance, industry will not stand the cost and the delay of excessive handling. You can no longer say to a man who lives on the outskirts of Birmingham and who wants to go to Margate that he must go on a certain route and change his method of conveyance about four times to get there. Anybody who tries to do that will only emulate the example of a gentleman who, many years ago, lived in a town near where I live. That gentleman went down 1032 to the seashore with his armchair and told the waves to go back, with the net result that he got his feet wet. The facts will show that the great necessity, and the great factor, in the economic running of the railways of this country to-day is the feeder services. Whoever controls the road feeder services to the railways controls the bridgehead to a large section of railway economy, and therefore to railway profitability.
At least, the noble Lord would have found out what was right—a very important thing for him to know—and what was wrong. And perhaps the noble Lord and the Government would have found out one thing that was even more important: they would have found out the human difficulties, the psychological difficulties. Here you have, in a huge organisation of nearly 1,000,000 human beings, loves and hates born of years. Some people have been on the railways so long that their minds will run on those rails for ever, and the iron has entered their very souls. Others have lived their lives on the roads. That is a difficult human problem which will not be solved by once again setting them at each others throats, in a wild scramble like that we had in the year 1933.
About a fortnight ago my noble friend Lord Macdonald moved in your Lordships' House a Motion on manpower. The noble Lord then made what I thought was one of the best speeches I have ever heard. He was followed by my noble friend Lord Kirkwood (he is not here to-day), who received the applause of noble Lords in all parts of the House for the human way in which he spoke. What was the burden of the speeches of both those noble Lords? It was that we politicians of all Parties had all gone wrong; that we had never tried to understand the workers, or taken them into our confidence. I remember the noble Viscount, Lord Swinton, saying: "Of course, you cannot move men about today like pieces on a chessboard." The noble Lord, Lord Balfour of Inchrye, paid a most glowing tribute to the noble Lord, Lord Kirkwood. But I really despair of some noble Lords opposite. They were quite sincere at that moment, and believed that it was in this direction that we had all failed.
But what has happened? Here the Government propose, without any 1033 thought, without any consultation, to put in jeopardy the jobs and livelihoods of 80,000 men and women. There is not one word in this White Paper as to what is to happen to them. After all, I am discussing this White Paper; I am not a crystal-gazer. There is not a word about whether these people are to be found other jobs. The noble Lord may say: "With the shortage of labour to-day, of course they will find jobs." But we could have said that at the time the Transport Act was presented by the late Government. In that Act there are elaborate provisions for compensating those whose conditions were worsened, those who had become redundant, and also so that they might have some security. There is not one word in this White Paper about that. What is to happen? Are they going to be found jobs? Are the conditions of employment going to be the same as they are to-day? Do not forget that the State has to be a model employer. Is the noble Lord prepared to give these 80,000 men and women employed by the Road Haulage Executive an assurance that they will be found jobs of equal worth, on the same conditions as those which they have now? If so, why is there not a word said about it? I feel that that is one of the most serious blots on Her Majesty's Government; I think it is really terrible.
When all the action, wise or unwise, is taken, when the dust and heat of this battle is over, Her Majesty's Government and successive Governments will have to carry the burden of the £1,000,000,000 invested in the railways. There is no proposal that the railways should be handed back. Can the noble Lord blame me if I look for some other reason? Why have these proposals been put forward? He cannot blame me for thinking that he has an "overlord" who has, in effect, said to him: "The Sword of Damocles is hanging over me. I have to fulfil an Election pledge. This is the one pledge of all which I cannot break. I have to do this, and you have to find the way." Can he blame me for thinking that? By any other test these proposals cannot be sustained. I come to the same conclusion and, what is more serious, a very large section of the British public have come to the same conclusion, as the Economist. What do they say? They say: 1034The White Paper is a set of contrivances to make the resale to private hauliers of lorries now owned by the Transport Commission look respectable.It is the shabbiest piece of political chicanery in the history of this country, dressed up to make look respectable.
Now let us turn to what it is proposed to do. As the noble Lord will understand, this part of my speech must be largely composed of a series of questions. I do not expect the noble Lord to answer, and I shall not feel aggrieved if he does not. But they are questions to which the answers will have to be found. I refer to paragraphs 7, 8, 9 and 10 of this White Paper. It says that the whole of these assets are to be split up into operable units. What do the Government mean by "operable units"? Is it a division? Is it an area comprising 1,000 vehicles right down to a group of 100, or is it just a few odd lots of vehicles, put together as a collection? Does it include the plant, the premises, the stores and the equipment? Is there to be any reserve price? The White Paper does not say so, and I have come to the conclusion that there is not. The whole lot is to be sold to the highest bidder. What is to happen to the 2,000 vehicles which are held in reserve? What is to happen to the new vehicles which the British Transport Commission have on order with the manufacturers of this country, to the approximate value of £10,000,000? I doubt whether the noble Lord knows that that order has been placed. He could have known, and he could have answered all these questions if he had made one inquiry. What is going to happen to this order? Very early in the life of the Road Haulage Executive it was necessary that they should get down to some sensible grouping, not only of styles of vehicles but of types. I happened to see the vehicles which they took over from private enterprise. I do not know how many makes of commercial vehicle there are in this world, but I dare swear that every one was represented in the mixed bag that was taken over from private enterprise. That was in the nature of things, but these vehicles could never be organised into any operable unit.
Are the Railway Executive or the British Transport Commission going to be allowed to tender for their own assets? Are the Railway Executive going to be allowed to buy any of these vehicles? 1035 If not, the Railway Executive will be in an even worse position than the railways were before nationalisation. Before nationalisation, the railways of this country owned 3,500 long-distance haulage vehicles. They wholly owned 45 long-distance haulage companies to a capital value of £6,000,000. Now it is said that they will not be able to run one road haulage long-distance vehicle; that they will have to be content with their few parcel delivery vehicles. This is a monstrous suggestion. I have put to your Lordships that the future pattern of transport means feeder services to railheads, and the section of industry, private or public, which owns those feeder services has the railway economy by the throat. Under this fantastic idea the Railway Executive or the British Transport Commission are not to be allowed to own a long-distance haulage vehicle. That is quite incomprehensible to me. I just do not know whose brain could have devised this scheme, because nobody knows anything about it. Nobody can explain what is going to happen.
It has been estimated (I do not know whether it is official, but I read it somewhere) that the Government expect to lose at least £30,000,000 of the goodwill—I will deal with the goodwill in a moment. But suppose that these vehicles do not sell and that private enterprise does not buy, then what is going to happen? Who is going to run the rest? What is going to happen to those vehicles with which the Government are left—the dregs and the dirt. Speculators are not going to buy anything but the "plums." They will buy the good batches of vehicles in the thickly populated areas, where they can get a quick return for their money. But supposing they do not buy them in the other places, who is going to supply those services? Are you going to resuscitate from the dead the Road Haulage Executive? What is going to happen? I do not know and nobody else knows. And at what rates will these services be supplied? These are very important things. We are not told. Suppose that a wild estimate has to be made. Suppose they sell half these 40,000 vehicles. What is going to happen to the other 20,000? Are you going to have another auction sale, or are you going to leave large areas of the country bereft of any 1036 road transport at all? I wonder whether this has been thought out?
What about this question of price? In paragraph 10, it says:Since the goodwill of the former businesses … disappeared, its undertaking is unlikely to be sold at the price at which it was bought.The goodwill has gone. Then it goes on to say:On the other hand, the units to be marketed will be going concerns and purchasers can he expected to pay for the trading rights and opportunities which go with them.Well, my Lords, I should have thought that a potential profit-earner—a going concern—could be sold with a goodwill. Of course, I know that it all depends whether you are a seller or a buyer, but I can assure the noble Lord that if I were the seller of a thing like this, and could offer an operable unit with trading rights and opportunities, I should put a pretty good figure on it for goodwill. But here are the Government, virtually the owners of £80,000,000 worth of taxpayers' property, putting out a prospectus and saying "Of course, this is not worth very much: the goodwill has gone." I wonder what the noble Lord and I would think if any company with which we were connected were to put out such a prospectus as this in connection with an auction sale of our property.
And now, one of our chief salesmen—I am going to call your Lordships' attention to the most scandalous speech made by the Parliamentary Secretary to the Ministry of Transport—addresses the guests at a luncheon at which his prospective buyers are present, and says to them, in the terms of this White Paper "Of course, these assets are not worth very much: you know the goodwill has gone." That is crying "stinking fish." Yet the Parliamentary Secretary to the Ministry of Transport was a very successful stockbroker in the City of London. If this were not tragic, my Lords, you would "laugh your heads off" at it. Fancy a stockbroker going to a city luncheon with all his prospective clients and saying "I have got here some shares to sell, but they are not worth very much"! Has lunacy ever gone further? I am not exaggerating at all: this is what is going on. Perhaps we shall have some answer from the noble Lord on this point.
1037 The next four paragraphs, 11, 12, 13 and 14 deal with the railways. I have no objection to decentralising if it proves to be right, but I cannot understand how it is going to work. I have read in one newspaper that it will be very difficult to have healthy rivalry, for instance, between a railway line that runs from Kings Cross to Edinburgh, and another that runs from Paddington to Bristol. I do not know—perhaps in the course of his speech the noble Lord may tell me about it—what is meant by this "healthy rivalry." But I think it is fair to mention that before nationalisation there was very healthy rivalry between the main line railway companies—as much as you could hope for; but the results, to say the least, were not such as to make their finances in a very healthy condition. And these suggestions are not to be embodied in anything, not even in the Bill. It is a scheme "hereinafter to be explained." I remember the noble Viscount, Lord Swinton, getting very heated in a discussion Vehicle we had in this House at the time of the Transport Bill over schemes "hereinafter to be explained."
§ LORD LUCAS OF CHILWORTH
Revealed. I have the memory of the noble Viscount working himself up into a synthetic Passion on this, and talking about the South Sea Bubble and all that sort of thing; but he has been a party to this one—to a scheme "hereinafter to be explained"—or "revealed."
There is another point. This plan is not really reviving competition between road and rail. It is reviving competition, or setting up competition now between a private enterprise service with no restrictions at all except those under the 1933 Road and Rail Act, and a nationalised service which has all the statutory responsibilities upon it. I ask the noble Lord to bear this in mind, for who is going to run the unremunerative services? Who is going to run all those services that private enterprise cannot be expected to run without being involved in a loss? After all there will always be some outlying parts of the country where people must be given a transport service, and it has got to be given to them at the smallest possible loss. It has been said—and the theory is very plausible—that what you want to do with the railways is to take away these responsibili- 1038 ties of common carrier, take away the responsibilities for having to run the unremunerative services and then say that you are going to run only services which are profit making. That sounds very good, but the first day that the British Transport Commission tries to do that, the Order Paper in another place will not be large enough to hold all the questions from the irate Members of Parliament, representatives of constituencies affected. At the present time no one has authority to order any service to be run except the British Transport Commission. The licensing authorities under the Road and Rail Traffic Act have no authority to tell the operator he has to run a service. The Ministry of Transport have no authority to say when a service must be run. The only people who can say that are the British Transport Commission, and they get their authority from the Transport Act of 1947.
I should like now to say one word about the levy. I do not think that any proposal has ever been made in this country which has been ridiculed so much as this one has. The noble Lord's best friends have told him in no uncertain voice what they think of it. I have not read in any newspaper in this country a single word of commendation of it. I think it is the most crazy thing that was ever invented by the mind of man. It is completely inoperable. This levy is estimated to produce £4,000,000—and that is a very tentative figure. The sum is to be divided into two categories. Part will be used to overcome the shortfall owing to the loss of the goodwill, or the shortfall of receipts resulting from the sale, the amount being amortised over a certain number of years; and the other is to pay compensation to the railways for the amount of remunerative traffic that would go from them to the roads—because the Government expect that this scheme will involve the railways in a loss of traffic. The levy, the White Paper says,will not be used for any other purposes, for example, to make good loss of railway revenues due to a recession in trade or a failure on the part of the railways to secure reasonable economies.But this business can flow from rail to road because the railways do not show proper enterprise. If they do not show proper enterprise, the levy will be paid, so this is really a blanket on good enterprise. The less enterprise they show, the higher will be the levy. Have you 1039 ever heard of such a scheme in your life? And all this is going to be adjusted once every three years by the Transport Tribunal. I feel very sorry for them.
I am not going to waste time, however, on that because—I will not make a prophecy about this, because Her Majesty's Government can do anything—if anything like a wise counsel prevails, this scheme will never see the light of day. I do not propose to occupy any time on that point except to say this. I understand that to-day the Chancellor of the Exchequer is to visit the Trades Union Congress and that the burden of what he is to say will be "wage restraint." Can you imagine anything more of a disincentive for wage restraint than a levy? Can you understand it? To-day £17,000,000 is asked for by the railway unions in increased wages; that, if granted, will not be an avoidable expense and the charges will go up. Railway charges will go up, traffic will flow to the roads and the levy will be paid. I beg the Government to think seriously about this. I will leave it at that. I need not say much more. I am not going to say anything about the Transport Tribunal and the way the White Paper says that now we are to have a Transport Tribunal and a Minister to correct them. The noble Viscount, Lord Swinton, is the authority on that. He will know all about these "wicked Ministers" who can, for foul political purposes, alter the decisions of the Transport Tribunal, especially round the time of council elections, so I will leave that to him. He will be able to explain exactly what it means.
I have detained your Lordships longer than I should have done, but this is such a serious matter that I have tried to put really commercial considerations before the House. I am going to tell your Lordships that I do not intend to divide the House. The reasons why I do not intend to do so are two: first—and I want to address these words very seriously to the noble Lord the Secretary of State—I believe the arguments which I have advanced have sufficient weight for the Government to have second thoughts, after considering them; because, after all, that is one advantage of discussing a White Paper, that it gives time for second thoughts before Bills are intro- 1040 duced. Secondly, there is a grave national interest confronting us all, irrespective of Party. It is no use the Conservative Party pointing the finger of scorn at us and saying that if we have returned to us the responsibilities of government and reverse this policy, we shall, by so doing, he wreckers of the national interest. It is no good the Conservative Party saying that, because the Conservative Party are doing exactly the same thing.
§ LORD LUCAS OF CHILWORTH
It is no good them sitting in a glass house and throwing stones. My right honourable friend, Mr. Herbert Morrison, who speaks with far greater authority than I can command, has said that we are ready to consider changes which experience and the public interest show to be desirable. We are. But the one thing that must he clear is that it must be in the public interest—not, if the noble Lord will forgive my saying so, a sordid pay-off for an Election pledge which, the noble Marquess said the other day in connection with something else, was just bribing the electors. I beg to move for Papers.
§ 3.37 p.m.
§ LORD BEVERIDGE
My Lords, this debate began with a statement on the arrangements made for the continuance of this debate this evening, to cover, if possible, the long list of speakers. I feel that I should begin by saying that my personal arrangements for this evening unfortunately involve an engagement with the B.B.C. which, as it involves others, makes it impossible for me, as I should otherwise like to, to listen to those noble Lords who follow me. I apologise to them in advance. I can, however, I am glad to say, considerably shorten what I have to say, partly because some of the things which I had meant to say have already been said by the noble Lord, Lord Lucas, and still more because I am sure that most of the other things that I might have said in criticism of this White Paper will be said by those who are to follow me.
As the noble Lord who preceded me pointed out, the White Paper has had a very poor Press. I need not go over all that has been said. I need only give the Economist's description of it asdisappointing and inadequate.1041 The Manchester Guardian's description of it isa bad scheme,and The Times describes it as aSketch for transportand notthe material for a Bill.I would refer to one other point in The Times leading article, which emphasises the absence of any consultation with anyone in preparing this Bill. This measure, I think, can be fitly described only by borrowing some words from Touchstone. The While Paper comes before us as "an ill-favoured thing, but the Government's very own." I can only hope that the noble Overlord who has been cast for the pat of Touchstone will be able to commend this Audrey better than ever before.
As I have said, I am not going to cast any aspersions on this White Paper, because there will be so many to come later. I am going to take a slightly different line. I want only to ask a few questions of detail. One has already been touched on by the noble Lord who preceded me. I do not know whether or not he is right in his supposition. Are the 11,000-odd vehicles which formerly belonged to the railways and which passed, presumably, to the Road Haulage Executive to be included in the sale back to private enterprise? If they are to be included, then it is clear that the railways will lose what they have always in the past regarded as essential feeders to the railway system. I should like the noble Lord who is to answer to tell us exactly whether the White Paper does mean that or does not mean that.
Next I hope that he will be kind enough to interpret for me and for the House the word "eventually" in paragraph 8. That is a word which appears in the last sentence, where the Paper says that the 25-mile limit imposed under the Transport Act will be abolished at once in regard to the vehicles which are bought back by private enterprise, and "eventually" for all vehicles. I need hardly say (as any noble Lord who remembers what I said when this matter was in debate in 1947 under the Transport Bill will know) I have no love at all for the 25-mile limit. The 25-mile limit means that a vehicle subject to it cannot be more 1042 than 25 miles from its operating centre. It can run as far as it likes, provided that it goes in circles. The 25-mile limit is a means of promoting the efficiency of transport by giving it free rein to run in circles but not in straight lines. I hope that limit will be abolished. But what does "eventually" mean? Because if I am a private enterprise person, thinking of offering a price for some of these vehicles which are to come back to me, a material consideration in fixing my price will be whether I think I am buying a privileged position or whether I think I am almost immediately going to be compelled to compete with others. It appears to me that the Government will have the choice either of getting a lower price on selling these vehicles back, or of keeping the other vehicles for a longer term under the 25-mile limit.
Thirdly, I hope the Government will be kind enough to interpret for the House and for me the words in paragraph 9 as to the meaning ofgreater latitude in the granting of new licences under the Road and Rail Traffic Act, 1933.Your Lordships will see that it says that there will begreater latitude … where need for a fuller or more convenient service is shown.I would ask the noble Lord to answer this simple question: is it more convenient to be able to get a service at half the price that you are paying for it? Does the price of the service enter into its convenience? It is obviously more convenient for me to be able to get a service for £1 instead of £2. Under this "greater latitude" provision, will people who wish to apply for licences be able to show that they propose to charge lower prices, or will they have to show, as has been the practice in the past, that practically no service at all can be provided if they do not come in? I ask the noble Lord whether he will kindly interpret those words to the House.
Now I want to come to a rather different point. If the Government are going to continue drafting the Bill that is to follow on this White Paper without consultation, this and similar occasions in the House are the only opportunities for discussion on the Bill before it is drafted. I hope, most seriously and most sincerely, that the Government are not going to draft the Bill straight away as 1043 they have drafted the White Paper. I ask them to reconsider not the details of the White Paper so much as their whole procedure. I should like to introduce what I have to say by referring to the words used by a very distinguished noble Viscount whom I see opposite me on the Front Bench—Lord Swinton—when the Transport Bill was under discussion in this House in 1947, and when the noble Lord, Lord Lucas, introducing the Transport Bill on behalf of the Labour Government invited the noble Viscount, Lord Swinton, to be enthusiastic about that Bill. The noble Viscount replied that the Bill was "a strange adventure." He thought that any impartial judgment on it would describe it as "a leap in the dark," whereas only the most enthusiastic would go so far as to say it was a "stumble in the twilight." I suggest to the House that to any impartial mind the White Paper of 1952 which we have before us to-day is a leap in the dark backwards to try to get to something that you have left behind—and a leap wholly in the dark.
I should like to put up a plea for a little light before the Government leaps, and asks the country to leap with it, backwards from where we are to-day. I ask for that particularly because there are many important practical questions in regard to this Transport industry which are not answered in the White Paper, and which in fact have little to do with the question of who owns the vehicle concerned. There is the vital question of what would really represent fair competition between the different forms of transport, the railways and the roads. Underlying that are difficult questions as to equities, finance and taxation, which will certainly be brought out in the discussion but which in some cases go considerably deeper; questions in which there is the issue between the railways, which have provided their own permanent way, and road transport, which get their roads provided for them, subject to taxation. The suggestion is made, too, that if the railways had happily been nationalised many years ago, the whole of the money sunk in permanent ways would have been repaid, so that they would now have the permanent way for nothing. This is the kind of argument that can be used on both sides, irrespective of who owns the 1044 railways or the roads. Considerations of this kind have a vital effect upon how the charges for the two services are fixed. Then there are the questions of the relations of the various agencies, the Minister, the Transport Commission, the Executives, the Tribunal, and all the other different people—sometimes, perhaps, more than one Minister—who appear to come to the discussion of transport questions. These are not really dealt with fully or sufficiently by the White Paper.
Quite a different set of questions arise which apply equally whether we have private enterprise or public ownership: the protection of the public from monopoly, whether public or private. That is important, because, as we all know, the "A" and the "B" licences (the "A" in particular) have been hard to get. Even before the Transport Bill was passed the industry was rapidly becoming almost a closed industry. I come now to one more question which is not touched upon in the White Paper and not affected by the question of ownership—namely, the avoidance of waste of resources by restrictions upon what particular vehicles may do. I refer particularly to "C" licensed vehicles, of which I believe there are 800,000. The vehicle under "C" licence is not allowed to carry anything except the goods of the person owning it, which means that a large proportion of those vehicles must run empty half the time. Is that really a promotion of efficiency? That is a matter about which I, sitting with the Liberals, have a quarrel with both other Parties. In the debates in 1947 I described the "C" licence provision as "compulsory inefficiency by Act of Parliament." That question is not affected by anything in the White Paper, but I hope that at some time it will be effectively inquired into.
All these questions, which are vital to the efficiency of the transport industry—and that means the satisfaction of the users of the industry—have nothing whatever to do with the ownership of the vehicles and are not affected either by doctrinaire Socialism or doctrinaire anti-Socialism. What I am asking is, that somehow, by inquiry, and irrespective of any political doctrine whatever, the Government should take steps to give serious consideration to what is really needed in transport. To make an inquiry takes 1045 some time, but I suggest that no real loss of time would be involved in this case. Suppose that this Government were to do what the Government did, I think in 1925, when they had under consideration the very difficult problem concerning the coal industry. They then appointed a Royal Commission on Coal Mining, which consisted of few members, none of them connected with the coal mining industry. It consisted of four people. My noble friend Viscount Samuel, who sits by me here, was Chairman; there were two business men of great standing, General Sir Herbert Lawrence and Sir Kenneth Lee, and myself. I remember that I was asked to join that Commission by no less a person than the present Prime Minister, who then occupied the office of Chancellor of the Exchequer. We began our work at the end of August and we signed our Report six months later, about the end of March. I suggest that it would be possible to have a Royal Commission of comparable size, with instructions to report in six months—or I would rather give them eight months, which would enable the views of all the people who use and want to use transport, as well as all the experts, to be considered.
If that were done, no time would really be lost, because if the Government proceed on the present lines they will be in for a very stubborn fight in both Houses of Parliament. The time of Parliament will be taken up on this question. I suggest that there are more important things for which Parliament can and should be used than the discussion of practical details of the transport industry. Indeed, there is one other measure which to me seems naturally to come before a measure for reversing the nationalisation of transport, and that is a measure for reversing the nationalisation of steel. In general, I hope that noble Lords on all sides of the House will agree that it is not desirable to set up a tradition of one Government reversing the actions of the previous Government. Going back into past history, I think that one of the most striking cases of that kind was when an Education Act passed in 1903 by the Conservatives, which had aroused great opposition among many Liberals, in practice was left untouched and proved very beneficial indeed. It was not reversed, though many people wanted it reversed.
1046 Now I ask your Lordships to look at these two measures concerning steel and transport. Transport was nationalized—so far as it has been nationalized—in 1947, by a Government with a very large majority, and obviously with a strong mandate for what they were doing. Steel was nationalised by what I can only describe as a rather shoddy transaction, and by a Government with a very small majority indeed, who needed to alter the powers of your Lordships' House in order to get the Bill through. In the case of steel, I think there is every justification for immediate reversal without further inquiry, because the Act ought never to have been passed. But that is not at all true of transport.
Are there not other things of vital importance with which the Government and the Opposition alike could concern themselves in the next six months, whilst my suggested Commission is sitting? There is our great economic danger. There is our great (we do not know quite how great), international danger. Cannot we try to avoid practical issues like transport? I suggest that we should not lose time if we referred this matter to some impartial authority, thereby giving everybody who really knows about this industry and is interested in it a chance to speak. That authority could then give us a considered, impartial report upon the whole matter, judged on its merits. We really should not lose time. The question is, should we gain by it? It may be asked: suppose we had a Commission, is there any chance of agreement on what it may recommend? No one can promise agreement. I cannot say that the Royal Commission to which I have already referred produced the General Strike; but it certainly did get a number of its recommendations carried out. I think my noble friend sitting beside me would be able to satisfy your Lordships that nearly all the recommendations of that Commission were in due course carried out, and the Commission brought great improvements in the industry.
On this question whether it is worth while having an impartial inquiry without being certain of getting agreement on its recommendations, I would refer to some words that were used by the noble Marquess who is now the Leader of the House, when the Transport Bill was under consideration in 1947. In the debate then I asked for an inquiry before 1047 road haulage was nationalised, and I said I was ready to abide by the decision of that inquiry. The noble Lord, Lord Morrison, who spoke for the Government of the day, in his reply said that it was useless to have an inquiry because we should never get agreement. The comment of the noble Marquess, Lord Salisbury, on that statement was that it did not seem to be a very strong argument for the Government's case. He went on to express much sympathy with my speech, which he described as making a brilliant and persuasive case for the kind of inquiry for which I had asked. Well, if there is no chance of agreement on a really impartial report, after exhaustive inquiries about transport, how miserable will be the prospect for this industry—an industry so vital in this economic crisis! If the Government proceed on the lines which they appear to have adopted up to the present, it will make the industry simply the continuing sport of politics. In another place Mr. Herbert Morrison has already announced that a Labour Government would immediately reverse what is proposed in this White Paper. To put it no higher, there is at least an even chance that the next Government may be of the kind to reverse this policy.
I appeal to this Government, therefore, that, instead of trying to legislate at once with that possibility before them, instead of continuing to keep transport in the arena of politics, they should try to take it out of politics for a time and see whether we cannot get some kind of agreement as to what is really the best course, irrespective of Socialist or anti-Socialist Governments. I appeal to noble Lords on this side of the House to accept and, indeed, to favour the holding of an unfettered and impartial inquiry, without giving previous notice of rejection of its results, as Mr. Herbert Morrison has given previous notice of rejection of the White Paper. I trust the words used by Mr. Herbert Morrison in Parliament only a month ago when he said on the question of transport fares increase:There is a case for a financial inquiry into transport and possibly a wider inquiry of the B.B.C. kind.That view was supported by the Leader of the Liberal Party in the other place, Mr. Clement Davies. I appeal to the Government most seriously, instead of think- 1048 ing about details of the White Paper to think again about their procedure, and I ask the Opposition to welcome an impartial inquiry, with no issue barred, if the Government decide to institute it.
Look at the alternatives. You can proceed to draft a Bill and spend all your energies on talking and fighting on it in Parliament. Alternatively, you can take transport out of Parliamentary politics for six months and have it discussed publicly and expertly by a Royal Commission, at the same time forming public opinion upon it. I hope that the Government will at least think again on this possibility, and I hope that the result of that thinking will be that we shall be all agreed to try to save this vitally important transport industry, to save it, if we can, from being the perpetual shuttlecock of Party politics.
§ VISCOUNT LONG
Before the noble Lord sits down, may I ask him a question? He said earlier on, as I understood him, that he was never in favour of the 25-mile radius for the road hauliers with whom I worked for seventeen years. May I ask him whether he voted for the Bill which my noble friend Lord Teynham introduced in 1950 to increase that radius?
§ LORD BEVERIDGE
I voted for increasing the 25-mile limit to forty miles, when that matter was before your Lordships' House, if that is what the noble Viscount is referring to.
§ VISCOUNT LONG
I have looked up Hansard and I find that the noble Lord's name does not appear in the list of those who supported my noble friend.
§ LORD BEVERIDGE
I have always wanted to have limits of forty and eighty miles. The answer to the noble Lord's question is "Yes." I will go and look up Hansard to see what happened on the occasion he mentioned.
§ 4.6 p.m.
§ THE SECRETARY OF STATE FOR THE CO-ORDINATION OF TRANSPORT, FUEL AND POWER (LORD LEATHERS)
My Lords, I am grateful to the noble Lord, Lord Lucas of Chilworth, for raising this question this afternoon, since it gives me the opportunity, which I welcome, to explain the Government's policy on transport and to clear up some misconceptions which seemingly still 1049 remain. In spite of all that has been said so far, we are firmly convinced that we have produced in the White Paper a sound scheme. We believe that it is in the best interests of inland transport, and of trade and industry, and that it makes a positive contribution to the solution of the transport problem which has vexed the country over the past thirty or forty years. But it is not a simple matter and I hope that by running over the ground in this way to-day I shall be able to satisfy some of the doubts which the noble Lords, Lord Lucas of Chilworth and Lord Beveridge, expressed, and which may well exist in the minds of some other noble Lords.
I must, if your Lordships will forgive me, hark back for a moment into history for a proper understanding of the context in which our policy is placed. Right up to the First World War, the railways stood unchallenged as the primary means of transport within the country. But by the 1920's, though still dominant, they had to encounter serious competition from road traffic. Motor mechanics and drivers who had learnt their trades in the Army entered the road haulage business and succeeded in taking some of the best paying goods away from the railways—"creaming the traffic" as the transport economists say. These and other reasons led to the setting up of the Royal Commission on Transport, which many of your Lordships will remember. The deliberations from 1928 to 1931 of the Royal Commission resulted in two Acts, the Road Traffic Act of 1930 and the Road and Rail Traffic Act of 1933, which for the first time imposed considerable restrictions upon the operations of road vehicles.
Nevertheless, the position of the railways still remained insecure and at the beginning of the last war urgent consideration was being given to the solution of this problem. The war temporarily shelved the problem and so far from there being much more transport available for the traffic offering, the virtual closing of some of our ports and the increased military traffic threw quite a different sort of strain upon the whole of our inland transport resources. However, in the midst of our war-time preoccupations we saw that the road-rail problem of the twenties and thirties would re-emerge as soon as the war ended. And in speeches which I made in this House during the war I pointed to the need for 1050 some integration of transport after the cessation of hostilities. At the same time I took pains to say that the problem would not be solved on doctrinaire lines. I also said, and I quote the very words:The only criterion must be what will best serve the interests of the nation.In the event, it did not fall to me or to this side of the House to propound the plans for such an integration, and it was left for the Party opposite to bring forward a scheme. I am afraid that the plans which emerged suffered from all the demerits of doctrinaire planning and ideological misconception. It resulted in the Transport Act of 1947, which in our view, and I think in the view of the country generally, is a bad Act—an attempt to regiment into a rigid plan, and to place under one central public corporation, the great mass of our transport services. Transport, above all things on this island, must remain flexible, and able to give individual services to trade and industry at all hours of the day and night and for all different kinds of traffic.
I make no complaint about the way in which those responsible for carrying out the Act have done their duty. In the face of great obstacles they have done their best to make the thing work. But the evils of the Act have been too much for them. The centralised control of the railways has brought some benefits, it is true. But, on the other hand, it has led to too much uniformity and has destroyed much of the initiative and enterprise and, indeed, pride of service which formerly existed under the old great names. In road haulage the disadvantages of over-centralisation has been even more marked. Before nationalisation, much of the success and value to industry of these services came from the close personal contact maintained between the hauliers and the customers. The attempt to weld these thousands of haulage undertakings into an unwieldy national organisation has led to no public advantage, and the customer has been served less well. At the same time it has dispossessed thousands of small hauliers up and down the country and brought much hardship in its wake.
I do not propose to go more deeply into the failings of the present system. I submit that it is a truism by now that the Road Haulage Executive have failed to give the service which traders and industrialists had come to expect from 1051 private enterprise. I need only quote to your Lordships the extent to which trades have turned over to running their own vehicles under "C" licences. At the time of nationalisation, there were under 500,000 of these "C" licences, and that total has grown now to over 800,000. When one reflects that, in the nature of things, a large proportion of these vehicles running on "C" licences must normally be running empty one way on each journey, one gets some measure of the failure of the British Road Services to provide the standard of service that the customers need. The noble Lord, Lord Lucas, and the noble Lord, Lord Beveridge, suggested that some investigation into the Commission's organisation and services might have been undertaken before we formulated our proposals. Such an investigation, however, would be a very long process, and it is by no means certain that it would lead to any agreed conclusions among those who conducted it.
§ LORD LUCAS OF CHILWORTH
My Lords, I hestitate to interrupt the noble Lord, because I know the difficulty under which he has to work, but this is important. I neither implied nor suggested that any investigation should take place by anybody outside. My criticism is that the Government and the noble Lord and the Minister of Transport never made one inquiry.
§ LORD LEATHERS
I shall come to that point in a moment, and I think quite effectively. No great research was required to ascertain the views of those who used the Commission's services. The noble Lord is himself well aware of them. The fact is that no public corporation could keep under control a job of the magnitude entrusted to the Commission by the Act. Without further inquiry it is clear enough that small- and medium-sized individual businesses are an essential element in road haulage if it is to give the best service of which it is capable.
Thus, in our view a new approach is needed. Our proposals are based on the conviction that success can best be achieved by allowing private enterprise to play a greater part. We think that a measure of competition will stimulate better results than could be achieved by an imposed system of so-called integration. Our plan means integration, but 1052 integration by a practical and businesslike means, rather than by theoristic conceptions. Your Lordships may ask—and indeed the noble Lord, Lord Lucas, implied this—why we have not contented ourselves with the proposal merely to raise the 25-mile limit which at present restricts the operations of the "A" and "B" licenced haulier still outside the net of the Road Haulage Executive. As your Lordships will remember, this was one of the proposals of the Conservative Party at the time of the Election. It struck me all the more forcibly, therefore, that the noble Lord, Lord Lucas, seems to have lent himself to favour this course.
§ LORD LUCAS OF CHILWORTH
I must protest. It was not I, but the noble Lord, Lord Beveridge. I never said such a thing.
§ LORD LEATHERS
If I am making a mistake, I apologise. I have looked this up and I thought that the noble Lord himself vigorously opposed the proposal in your Lordships' House, when my noble friend Lord Teynham sponsored a Bill to this effect two years ago. If that is not true, I ask the noble Lord to forgive me.
Even a modest relaxation of the 25-mile limit would have depressed the revenue and depreciated the value of the Road Haulage Executive's undertaking to such an extent that they could not have continued. I have that information from inside. Although all the consultations to which the noble Lord, Lord Lucas, has referred may not have taken place, there have been exchanges of views with those in the Commission which entitle me to say that if we had uplifted the 25-mile limit to 35 miles or 40 miles, that would have ruined the Road Haulage Executive. It would have let the private operator immediately into some of the best paying routes of British Road Services. And since in our view private enterprise can always give a better service than the Executive, the latter would in consequence find itself beaten in competition. The Executive would then become a liability upon the British Transport Commission, with consequent disruption of the latter's finances in a way that will not happen under our proposals. Furthermore, it would have given an unfair advantage to the short-distance hauliers 1053 still remaining in business over the long-distance hauliers whose businesses have been nationalised. Thus it would be impossible, in our view, to split the traffic between the Road Haulage Executive and the private operator in any manner likely to secure the public advantage.
So we came to the conclusion that there was no half-way house. Either we left the nationalised concern as we found it (which I believe all sides will agree was unthinkable) or we took the bold step of abolishing entirely the Road Haulage Executive and making other arrangements for a proper relationship between road and rail. Can your Lordships deny that we have been right in taking this decisive step?
§ LORD BEVERIDGE
My Lords, I should like to ask the noble Lord a question before he passes from this matter of the 25-mile limit. I understand that the White Paper proposes that eventually the 25-mile limit will be abolished completely for all "A" and "B" licences. From what the noble Lord has just said it is clear that that might affect the price that might be paid for these concerns. If "eventually" means quite soon, the price will be very small. The levy to be put on all other vehicles, including the miserable "C" licences, will have to meet that cost as well as all other costs. Is that not so?
§ LORD LEATHERS
My Lords, I think I have exactly what the noble Lord has put. It is one thing to say that if we raise the 25-mile limit that would ruin the Road Haulage Executive's business, but it does not mean that if we allow those now under the 25-mile limit to come in a little later, it would have the same effect on hauliers who have bought businesses in the meanwhile. The British Transport Commission's remaining road vehicles will be subjected to the licensing system. The abortive sections of the Act relating to road passenger and harbour schemes will all go. In return for diminution of their monopoly, the British Transport Commission will be given greater latitude in fixing their charges—a point to which I shall return later.
May I go back for a moment to our proposals for the liquidation of the Road Haulage Executive? The undertaking will be divided into self-contained operational units which will be offered 1054 for sale to the public by a Government realisation agency specially set up for the purpose. In many instances these units will comprise premises, as well as vehicles, equipment, spare parts and stores. They will vary widely in type and size so as to give ample opportunity to the small haulier no less than to the big organised firm. This will give ample opportunity, too, to the man who is already engaged in short-distance work within the existing 25-mile limit. Owing to the changes which have taken place since long-distance road haulage undertakings were compulsorily acquired by the Commission, it is impossible to put the clock back exactly to 1948, or to return their undertakings to the hauliers whose businesses have been expropriated. The road haulage concerns acquired by the Commission have lost their identity on being absorbed in the British Road Services organisation. Vehicles have been re-grouped and in many instances replaced by new vehicles of different type or size. Many premises serving a small number of vehicles have been disposed of, and the Executive have tended to concentrate operations and maintenance on bigger depots, each serving a larger number of vehicles than was common under private enterprise. The ex-hauliers who wish to return to the industry will, however, be able to put in a bid for units which suit them.
While the Executive's undertaking is being disposed of, we must, we feel, retain the existing 25-mile limit—augmented by the permit system to go beyond the 25-mile radius—for these private operators still working in the short distance market. This limit should continue in force until the sale of the undertaking is substantially complete—that may be roughly a year, but I cannot tell for sure.
§ LORD CHORLEY
Does the noble Lord intend to put a reserve price on these units, or is he going to let them "go for an old song"? That is about all that they will fetch.
§ LORD LEATHERS
No. Private enterprise, I am sure, will be glad of the opportunity to go back into their rightful business; and they will know that what has been made by way of profit by the Road Haulage Executive is no gauge at all as to what profit they will make, because they will work with an economy that will startle your Lordships. Some 1055 of your Lordships may say: "Why should the 25-mile limit be retained so long? Why not abolish it immediately upon the passing of the Act?" It must remain for some time in fairness to those who come into the business afresh or anew and take over the assets of the British Road Services and, therefore, the duty of the Road Haulage Executive towards the public. If such temporary protection were not given there might well be a scramble to cater for certain of the public needs while others were neglected, and important interests of trade and industry would suffer. It is better to turn over to private enterprise both the long-distance haulage traffic and vehicles to carry it, in a single operation, leaving existing hauliers to take care of the short-distance traffic in the meantime as they do now. Any adjustment between the two classes of hauliers whereby many of them may in future combine some long distance journeys with their principal activities of short distances, and vice versa, can best come later. I would remind your Lordships that we are not depriving the short-distance haulier of the right to bid for some units in the longer-distance haulage, so that he can gradually get an extension of his trade by that process. In this way the necessary and beneficient measure of de-nationalisation will be accomplished with a minimum of interruption to the transport services available to the country's trade and industry. And, as I have already said, the short-distance man, with the advantage of an existing base from which to expand can bid for the lots put up for auction, and with any lorries so bought can immediately strike out into the long-distance field.
§ LORD OGMORE
Would the noble Lord mind reading a little more slowly? I am trying to follow what he is saying, and it is very difficult when he is going at this speed.
§ LORD LEATHERS
That is one of my faults, I must confess. I will do my best to conform with the noble Lord's wish.
The temporary retention of the 25-mile limit may be irksome to those who have for so long been crying out for more relief from the restrictions which at present beset them, but the existing hauliers are those whose main interest in the past has been in the short-distance 1056 field, and the Government are bound to do the best they can with the present situation as a whole. To deal with such matters as the mileage limit in isolation would not help to solve the transport problem; indeed, it would make it worse. During the change-over, the British Transport Commission—and this is one of the many matters which we shall be discussing with them—will have to carry on their road haulage undertaking, making any necessary adjustments as each lot of vehicles is sold and transferred to new ownership.
And here I would like to say a word about the staff of the Road Haulage Executive. Believe me, my Lords, I dislike as much as anyone the uncertainties caused by this sort of thing. But the fact remains that the Party opposite must take responsibility for taking the first disastrous step.
§ VISCOUNT STANSGATE
The noble Lord has been good enough to allow me to ask a question. May I remind the noble Lord that the first person to suggest the nationalisation of the railways was the present Prime Minister?
§ LORD LEATHERS
We are dealing at the moment with the road haulage side. Under our plans, the vast mass of the managing, operating and maintenance jobs will remain, but they will be with private enterprise instead of with the Executive. There may well, I am bound to admit, be a reduction in the number of the clerical staff. Inevitably with the process of nationalisation there has gone hand in hand a building up of a sizeable administrative tail, and from what I have heard there is some waste of manpower there which we can ill afford—and it runs into very large numbers. However, plans for compensation for those who may suffer from displacement are being worked out on recognised lines and will be included in the Bill.
§ LORD LUCAS OF CHILWORTH
Before the noble Lord leaves that point, he will, I am sure, understand that this is a most important matter. Compensation, I take it, will be paid alongside the 1057 plan that is in force at the present time which the late Government established under the Transport Act. May I ask who will pay that compensation? Will the State pay it; or will the private hauliers who buy back the vehicles pay it?
§ LORD LEATHERS
How unfair, my Lords, it would be to ask private enterprise to pay such an item for people who are superfluous to the work. They will be able to run their organisation without a very large number of the people to whom I have referred, and whatever is the ruling authority for the compensation, that will apply to this case.
§ LORD LUCAS OF CHILWORTH
I am sorry, but I must insist. The noble Lord has not answered my question. In point of fact, he is completely wrong. There were smaller staffs employed by the Road Haulage Executive than there were by the private hauliers. That is a figure which the noble Lord could have got, had he made inquiry. Compensation has been paid recently to the extent of nearly £40,000, because the Road Haulage Executive found a redundancy of staff employed by private enterprise.
§ LORD LEATHERS
Indeed, I do not think it is correct to say that to-day the Road Haulage Executive have not got more clerical staff attached to their road haulage side of the business than ever occurred under private enterprise.
§ LORD LUCAS OF CHILWORTH
That is not what I asked. What I asked was, who is going to pay the compensation.
§ LORD LEATHERS
Whatever compensation is provided for in the Act as it stands will, of course, be honoured. Any suggestion that these men will be worse off is a deliberate—shall I say?—misrepresentation of the truth. Our proposals are designed to give them more work; they are designed to allow for the expansion of road haulage and so, after perhaps an initial period of uncertainty—that is most likely to arise—the individuals concerned should find themselves better off. Above all, I hope that we may see early signs that this 1058 prospect is realised by that most important link in the chain of operations, the long-distance lorry driver himself.
I should like to say a word about the railway side of our plan.
§ THE SECRETARY OF STATE FOR COMMONWEALTH RELATIONS (THE MARQUESS OF SALISBURY)
Would the noble Lord allow me to say something?
§ THE MARQUESS or SALISBURY
What I want to say is this. The noble Lord spoke for over an hour, which he was quite entitled to do, and he was listened to in perfect silence, though he made, from our point of view, a rather provocative speech. After the noble Lord, Lord Leathers, has spoken there will be a debate, and the noble Viscount, Lord Swinton, is to wind up. I think it is only fair to the noble Lord, Lord Leathers, who has a rather difficult and detailed piece of exposition, to allow him to develop his case.
§ LORD LUCAS OF CHILWORTH
My Lords, I am grateful for the intervention of the noble Marquess. May I ask him a question for the purposes of clarification? I apologise to the noble Lord, Lord Leathers, for what may have appeared rude interruptions—they are not really. May I take it that all the questions we wish to ask will be answered by the noble Viscount, Lord Swinton, when he winds up? If that is so, we are perfectly happy.
§ LORD LEATHERS
I hardly think that an undertaking from me is called for, because that would follow in the natural event. Our proposals are designed to give these men more work.
I should like now to say a word about the railways side of our plan. It is not proposed to denationalise, but to reduce the excessive centralisation of the railways. For this purpose, the Commission will be asked to prepare a scheme for the Minister's approval. This scheme 1059 will deal with such matters as the areas into which the railways are to be divided for management and operation; with their constitution and their relation to the Commission and the functions of those in charge of the areas. Areas will have a greater measure of independence than the present regions, but it is clear that the railways will still have to be treated as a whole for some purposes, such as finance and charges. Scotland will be a separate area. In the matter of charges, the railways have of recent years suffered from the lengthy procedure which has to be followed when rising costs make it necessary for charges to be raised. Indeed, part of the accumulated deficit of the British Transport Commission can be ascribed to this fact. We certainly hope that no further increases will be necessary. But if they are, we propose a speedier procedure which, while still protecting the public, will enable the railways to gain more quickly the revenue needed to meet increased costs. Moreover, it is our intention that the railways shall also be freed from certain restrictions fettering their right to lower charges. Subject to reasonable safeguards, they will have power to adjust individual charges or groups of charges downwards to meet the competition of the more stimulating conditions for which we plan.
I now come to the proposed levy on road transport, which your Lordships will doubtless find the most novel and, may be, the most controversial part of our proposals, and which we, for our part, regard as the keystone of our policy. First, let me say that the levy must not be viewed in isolation, as it has been by some critics; it must be seen as part and parcel of a practical plan providing for working arrangements between road and rail. We are giving the road greater freedom in the knowledge that this is often the cheaper and more convenient form of transport, and in the conviction that trade and industry will thus benefit. But if road is allowed to expand at the expense of rail, the railways should be able to make corresponding economies. If these economies are fully compensating, well and good; but it is more than likely that the railways will be faced with an unavoidable loss of net revenue by having to maintain assets essential for 1060 other purposes but not being used to the full. Unless some other arrangement is made, the railways would have to make good any such loss by raising their charges on the rest of their traffic. We propose, therefore, that there should be a levy on road goods transport. The levy, as is stated in the White Paper and as it is most important for everyone to realise, is limited in its application to two purposes—and two only. The first is to enable the Commission to liquidate any capital loss it may sustain in the sale of its Road Haulage undertaking, including the cost of sale. The justice of this first call upon the levy I am sure your Lordships will grant. Was it to be expected that any loss incurred should be met by the Exchequer or by the Commission? No, my Lords. It is much fairer that trade and industry, who are going to get so much better a service out of our plan, should meet the cost. And the cost will not be heavy, seeing that it can be spread over a very great number of vehicles, and seeing that the period for amortising any loss can also be spread.
The second purpose of the levy is to enable the Commission to meet any net loss incurred by the railways owing to the transfer of traffic from rail to road arising out of the new plan. It cannot be too strongly emphasised that this second element in the levy has a strictly limited purpose. It will operate only where there is a definite transfer of traffic from rail to road, and then only to the extent that the consequent loss of revenue to the railways cannot be offset by compensating economies. Any reduction in railway net revenue due to other causes would not be reflected in the levy. I have seen suggestions in the newspapers that the levy gives the railways a blank cheque, which takes away from them all incentive to efficiency. But this is not so. The second element in the levy will be increased only to the extent that the roads attract additional traffic and that the railways cannot make countervailing economies. The levy in no sense represents a "feather-bedding" of the railways. I am sure that it will be a matter of pride to the railwaymen to make every possible effort to avoid having to make any use of this second part of the levy. The operation of the levy will remove the main objection to an expansion of road haulage, and we therefore intend that new carriers' licences shall be more 1061 freely granted. Thus a more proper relationship between road and rail will gradually establish itself, without cost to the State, without causing serious financial difficulty to the railways and without imposing an undue burden on road transport. This process will be gradual but far-reaching.
The amount of the levy will be decided from time to time, probably at intervals of three years, by the Minister of Transport, after obtaining the advice of the Transport Tribunal. It will be fixed for the initial period at a figure of about £4,000,000 a year. Your Lordships will see that this is not a burdensome figure, when I tell you that it represents no more than a very small fraction of a penny per ton-mile. Moreover, when spread over more than half a million vehicles, as it will be, it is seen then in true perspective. I have seen criticism that road haulage is being called upon to pay this sum when vehicles are already paying large amounts by way of excise and petrol duties. But this £4,000,000 is something quite different from a tax, and is specifically designed to enable the road haulage industry to come back into business; and to enjoy greater freedom without treating the railways unfairly. Surely, my Lords, it is a small price to pay for freedom. We have felt bound to bring "C" licensees—that is, traders carrying their own goods—within the scope of the levy, except for small delivery vans. "C" licences are granted without let or hindrance, and their numbers has more than doubled since the war. At the same time, their owners use the public transport system where it suits them, and are almost invariably dependent upon it in some way for the conduct of their business—for example, for the delivery of raw materials. Before I leave the subject of the levy, I should deal with the criticism that this means an automatic increase in the costs of distribution. That is neither correct nor fair. I have explained how small the incidence of the levy will be on any particular operator, and I feel sure that private enterprise will certainly be able to absorb the sum involved by operational economies.
I have seen many speculations about the future organisation of the Commission and its Executives. This is essentially one of those matters which we shall discuss with the Commission. At this point, 1062 perhaps I should deal with Lord Lucas's question to me about consultation with the Commission. We did not work out Government policy with the Commission. It must be for the Government to formulate the broad lines of policy in this as in any other field. The function of the Commission is to carry out the duties assigned to them by the Transport Act, and it would have been unrealistic to expect the Commission to be able to take a completely dispassionate view of proposals which so deeply affect their structure and functions. They are, of course, being consulted about the practical application of the principles embodied in the White Paper, particularly in the matter of future organisation. In some shape or form there will have to remain, it seems to me, a central body to which the Area Railway Boards can be responsible in such matters as finance and charges. This body will also weld together the financial results of the London Transport Executive and the various bus companies in which the Commission hold a share, the docks and inland waterways and the hotel and restaurant services. I am sure your Lordships will agree that we are right not to entertain rigid or preconceived notions on this topic. In these matters of organisation we hold ourselves ready to hear the views of those who now run the different services.
Before I close, I want to say that although there is no mention in the White Paper of coastwise shipping Her Majesty's Government do, of course, appreciate the bearing of our proposals upon that form of transport. It may be that some owners are apprehensive of the effects of the freer competition which we envisage. I do not myself feel that there is much in this point. But I know well from my own experience, both as a shipowner and as a Minister of War Transport, the value of our little ships; and we shall certainly be glad to look at any points which coasting shipowners may put before us.
My Lords, I take my stand by these proposals. We are working hard upon a Bill to embody our intentions. It will be a complicated measure and it will fill in all those details which you will want to see. But naturally you will not expect me to anticipate that Bill or go further into detail than we have already done about our intentions. In due time the 1063 Bill will be before Parliament and as the years go on and new life is seen to be put into our inland transport system by these proposals, and we see once more the private haulier plying his trade up and down the countryside and giving that first-class service upon which he rightly prides himself, I have no doubt that posterity will look back and thank us for placing these proposals before Parliament.
§ 4.42 p.m.
My Lords, in spite of what has been said by the noble Lord, Lord Lucas, I think that few would claim that the nationalisation of transport has been a success as regards the provision of an integrated and efficient transport system. For that reason I welcome Her Majesty's Government's new approach to this very difficult problem; in fact, I think it was the noble Lord, Lord Lucas, who in a previous debate declared that the present transport organisation is inadequate and asked for an inquiry in order that more facts could be brought before us. I think that that is unnecessary, since for many months we have had all the facts before us. The noble Lord, Lord Beveridge, has asked for a Royal Commission; but surely that would be bound to cause considerable delay and to produce the greatest uncertainty in the industry at the present time. On the other hand, I hope that Her Majesty's Government, before introducing a Transport Act (Amendment) Bill will have full consultations with all sections of the transport industry and with trade and industry generally. I think that that is vital.
Lord Lucas suggested that if Her Majesty's Government started to sell the road haulage vehicles they would be hazarding the taxpayers' money. But I should have said that it was the Socialist Government that hazarded the taxpayers' money when they nationalised the industry. Lord Lucas also told us that the Road Haulage Executive made a profit of £3,000,000 in 1951. I should like to ask the noble Lord whether that is only trade profit or whether it includes the interest payable on the stocks. Of course, it is easy to make money if you go about it in the right way and do what the Transport Commission have done only recently. I can give an example of a certain private road haulier in one of 1064 the Eastern counties, who quoted a rate of 15s. for a load of wheat. He was refused a permit. Afterwards the Road Haulage Executive came in and did the business at 25s. On that basis, of course, it is easy to make money.
I am convinced that the only basis for an efficient system of transport is for reasonable and fair competition between road and rail. For this reason I feel that the railways must be relieved of their various difficulties which come from their public obligations as common carriers. This is a vital point but I do not propose to enlarge upon it, because another noble Lord is, I understand, going to deal with it. I should like to deal for a few minutes with the question of decentralisation of the railways. The White Paper lays down that the new autonomous areas:… may follow the general pattern of the present regions.Now, from the point of view of control, this would be admirable, but I fail to see how competition with railways themselves will materialise. In the old days, competition arose from the fact that there were at least two alternative main routes between North and South and between East and West. It might be worth while considering having more units than is proposed under the system in the White Paper, and I would suggest going back to the system which existed before the amalgamation. I do not see how we are going to have competition unless there are alternative routes. I also think it will be worth considering that in time each unit should have its own capital structure. I believe that one day it may be necessary for proper competition.
I am sorry to see that the proposed levy is to be applied not only to road haulage operators but also to the "C" licence holders, because it must be remembered that traders are certainly prepared to use an efficient transport system rather than their own vehicles, which must in any case be an additional expense to them. I suggest that they are being unfairly penalised. There is no doubt that the large number of. "C" licence holders to-day would be greatly reduced if an efficient road transport system again became available to them in this country. Speaking personally, I should like to see the whole system of levies on an entirely different basis. I should like to see the country divided 1065 into six areas, Scotland being one area, and on a horizontal basis. In each area the road haulage operator would be permitted to have free movement on one licence. Should he wish to move into another area he would have to pay for an additional licence for that area.
For example, if a trader was anxious that his goods should be delivered by road rather than by rail, say from London to Newcastle, the road haulage operator would quote a price which included the cost of additional licences to pass through each area. Different coloured licences might be used for each area. Under this plan, the railways would have fair competition from the roads, and the funds received from the licences could be used for the same purpose as indicated in the White Paper for the levy. It would be far more equitable, I cannot help feeling, than the direct levy on a ton-per-mile basis which is proposed in the White Paper. The road haulage operators would have a large east-and-west area of movement, and on one licence. On this basis I think the "C" licence holders could be fairly included in the scheme. It must not be forgotten that road haulage is already paying very heavy taxation indeed; in fact, I believe that some £335,000,000 is raised by motor taxation, whereas only £33,000,000 goes into the roads. It is unfair that road haulage should have to pay an increased tax by direct levy, whatever their movements may be.
Now, whatever this Government may decide to do, I hope it will be possible to defer the levy for one year until the whole new organisation has settled down, and during this period to support the railways from a portion of the motor tax funds. The railways certainly had a raw deal during the war, but in the war the Government gave a guarantee of £43,000,000 per annum by way of rental. Owing to the heavy traffic the railways actually made a substantial profit over that figure. What happened? This substantial profit was taken by the Government of the day and used for general taxation purposes. Therefore, I see no reason why some of this capital should not be returned to the railways for capital expenditure, in order that they may improve their services and be enabled to get on a Competitive basis with the road services. The figure which was taken 1066 from the railways amounted to something like £195,000,000. I cannot help feeling that, if some of that money were returned to the railways, in twelve months' time, or perhaps a little longer, a subsidy would be unnecessary. I am sure that the railways can be made to pay if they are re-organised and placed on a fair basis. This is undoubtedly the opinion of many railway experts who know their business. I cannot help feeling that a direct levy on the road haulage industry will establish a dangerous precedent, because any Government may at any time increase this levy as a form of taxation. I hope that Her Majesty's Government will reconsider its form of application.
It is true that the White Paper states that the levy need be increased only to the extent that the roads attract additional traffic from the railways and will not be used to make good loss of railway revenue due to recession in trade. But I really cannot see how that is going to be assessed. It would appear to me a very difficult and almost impossible accounting matter. I do not think any Government would have much difficulty in increasing for general taxation purposes the levy in its present form. I welcome the intention, as set out in the White Paper, to repeal the powers of the Transport Commission to make area schemes for passenger road transport services. I hope that provision will he made in due course for many of those people to recover their own public service passenger vehicles which were taken from them under the 1947 Transport Act. I think it is true to say that the number of these omnibuses amounted to something like 14,000 when they were acquired by the Transport Commission. I am sure that Her Majesty's Government will hear this point in mind. I hope that, before the final draft of the Transport Act (Amendment) Bill is decided, Her Majesty's Government will confer fully with all the organisations concerned who have at heart the provision of an efficient transport system.
§ 4.53 p.m.
My Lords, the White Paper strikes me as rather being rather like my last week's egg ration. One part of it—I refer to the denationalisation of transport—was extremely good and I welcomed it because anything that tends to restore the flexibility that private enterprise transport used to have is for the 1067 good of all, and will greatly reduce the number of "C" transport licences on the roads to-day. But the other part, I am afraid, is a "completely inedible egg," so far as I am concerned. I view the levy as being a most dangerous precedent. If one goes back to 1928, one remembers that a tax of 4d. was put on petrol. It was done in order that, with the ordinary surplus, it should be the means of providing for rating reliefs in productive industries. The productive industries included the railways, so, as that 4d. has never been repealed, the railways are still getting their benefit from it. That 4d. in 1928 produced £12,000,000. A similar sum to-day produces £28,000,000. Could not some of the £16,000,000 difference be used to provide the £4,000,000 now required? I think that that is a reasonable request.
Also, the petrol tax, which was introduced in 1928 at 4d., has now become half-a-crown. It is noticeable that the trainer (if one may so irreverently refer to the Chancellor of the Exchequer) who introduced that petrol tax is now the owner who wants to introduce a levy. It makes me more suspicious than ever. Is the £4,000,000 that is introduced to-day going to be turned into £30,000,000, in the same way as the 4d. became 30d.? With regard to the levy itself, it is said that it is imposed to meet the loss of money when the transport is sold back to private owners. Is not it a little curious, and possibly a little unjust, that you should ask people to pay a levy which is in effect being paid to provide for the help of those who want to enter into competition with them? You are putting the levy on all and sundry, but it is to pay for those who want to go back into the trade, which strikes me as a little unjust.
Moreover, I am not quite so optimistic about the number of people who want to get back into the trade. I think there may be a great many units which will find some difficulty in attracting purchasers. So far as the payment to the railways is concerned, I should like to emphasise the point already made by the noble Lord, Lord Teynham: Who is to decide which of the railway losses is due to the roads "pinching" the traffic from the railways, and who is to decide that the railways have not lost that traffic through inefficiency? That strikes me as 1068 something which will indeed need a Solomon, and I do not believe that such a Solomon lives in this country. I regard the levy as a very dangerous thing. The Government say they are going to leave out the small local delivery van. But what about the delivery to the man who uses the small local delivery van—the milkman? His milk comes by road. Is his van that collects the milk to be charged a levy on his journey to fetch the milk, yet not on his journey to deliver it? There are many curious complications. I beg the Government to adopt the suggestion of the noble Lord, Lord Teynham—not to do anything about this levy for at least twelve months until it is seen whether it is absolutely essential and whether there are not some other means of doing the same job.
§ 4.59 p.m.
§ LORD GREENHILL
My Lords, it is understandable that we on this side of the House should regard this White Paper with disfavour, because it tends to destroy a structure which we have built up and which we think is making good progress. It is understandable, also, that noble Lords opposite should feel some anxiety and perturbation about the enormous amount of criticism that has been vented against the White Paper by responsible newspapers, and even by papers of high technical standing. What seems to me difficult to understand is why, in face of that informed opposition and criticism, the Government should persist in the scheme which they have outlined in this White Paper. I do not know what impression my fellow noble Lords gained from the speech by the noble Lord, Lord Leathers, but I confess that to me it seemed that the noble Lord was less concerned with improving our transport system than with the political desire to try to undo nationalisation. That was my distinct impression.
If one tries to analyse the statements made by the noble Lord in his speech to-day, one has the feeling that it contained no real criticism of the operation of the nationalised system but that his feeling was that it was better to have the railways and road transport run separately. I confess that I felt that there was a good deal of artificial heat about the present situation. When one looks at the matter it seems to me that we are 1069 attempting to attach far more importance to that section of the road haulage industry that is nationalised than is warranted by the facts. I would strongly urge the noble Lord to read, in the current number of the British Transport Review, an article by the Public Relations Officer of the British Transport Commission. He says:Next to the idea that the taxpayer pays the piper, the notion that the Commission is an all-powerful monopoly colours most current criticism of operating efficiency. It cannot be said too often that the Commission holds no monopoly in transport and is unlikely ever to do so. The facts speak for themselves.The greater part of road transport, both freight and passenger, is operated under private enterprise. The State undertaking owns and operates some 55,700 goods vehicles (including those owned by the former railway companies), compared with nearly 120,000 operated by private haulage firms and as many as 781,800 operated by traders to carry their own goods. Even in long-distance road haulage, where the Act intended the Commission to have a qualified monopoly, there are over 7,100 private firms whose vehicles have three-year permits to carry established traffic.I do not want to extend the quotation but I would suggest that that article may be read.
When the noble Lord says that the increase in the number of "C" licences is an indication that the people using them are dissatisfied with the service they are receiving, I want to suggest what I think is the truer explanation—that we are, in fact, facing an almost revolutionary change in the system of transporting goods from one place to another; that for some purposes the railways are becoming obsolete and that for other services road transport is becoming the better and more economical method of haulage. Therefore, the present Transport Commission, aware of this kind of problem, and applying themselves very carefully (from what I can judge) to it, have said that a certain amount of integration is certainly necessary. Again, I would refer the noble Lord to this particular number of the British Transport Review, which gives a long list of schemes of integration, both carried out and contemplated, as part of the larger system.
I have the fear—which I think is justified—that the intention behind the White Paper is not so much to improve the transport system as to give to private enterprise what the nationalised system took away front private enterprise. That, I think, is rather marked, when we con- 1070 sider what is said by so important a paper as Modern Transport, which I think the noble Lord will agree is a paper of some standing in the transport industry. This paper says, first, in connection with denationalisation:We regard the first of these proposals as purely destructive and wholly unjustified by the progress which has been made over the last four years by the Road Haulage Executive.But in regard to paragraph 10 of the White Paper this journal says something which seemed to me to be rather significant, namely:…the machine which has been created with so much labour and expense is to be broken up and offered at 'physical assets' value to public tender. And who are to be the purchasers? We understand that in process of formation are syndicates who are insisting upon the maintenance, at art rate for the time being, of the 25-mile radius restriction while they themselves will be free of it. Thus it is to a wide yield of private monopoly rather than to the small operator, with whom so much sympathy has been expressed, that publicly owned haulage seems destined to pass.I do not know what evidence the writer has for making that statement, but there is a statement front, as I say, a responsible authority.
Then we have the Parliamentary Secretary to the Ministry of Transport speaking, so far as I can see, to the only body which really welcome this White Paper—namely, the Road Haulage Association—
§ LORD GREENHILL
He said what was pointed out by my noble friend Lord Lucas—and I quote from the Manchester Guardian:Even the short time of nationalisation has dissipated goodwill to the four winds of heaven.What is the significance of a statement of that kind? If private enterprisers are to buy back these assets, which on the admission of the Minister are row very much less because there is no valuation, what are the prospective purchasers to think when they come to offer? First of all, let me say that I do not agree that valuation has disappeared. It may be true that the individual firms from whom the businesses were bought can no longer say there is a valuation, but that valuation has not disappeared; it has merely become merged in the large body of purchases which have 1071 been taken over by the Commission. And to that extent the total of these valuations is to be found in the figures of the Commission.
When it comes to these private buyers buying these things, it is obvious that they will expect to get them at a price from which the question of valuation has been entirely eliminated. They will certainly try to keep the price as low as possible, because I understand that the chairman of the Road Haulage Association said at the same meeting that he assumed the Government were prepared to lose £25,000,000 on that transaction. Since he has already made up his mind that £25,000,000 will be lost by the Government, obviously that figure will be taken into account when he, or members of his Association, begin to tender for these vehicles. No, my Lords, I really think the position is this: that the Government are concerned less about the working of the transport undertaking than about this question of nationalisation, about which members of the Party opposite, both here and in another place have shown so much heat; and they will take whatever means they can to regain this valuable part of the transport undertaking.
I suggest that a distinction should be drawn between the ownership of the transport undertaking and its organisation. From my own not very wide experience of transport, I find that there is room for modifications in certain parts, for a little consideration in regard to organisation, for questions concerning the granting of licences, and several other things. But I am also sure that in the four years that transport has been run by the Transport Commission they have applied themselves very seriously, and to a large extent effectively, to dealing with precisely these problems. Given a little time, the machine would begin to run smoothly and effectively, and we should then see the benefit that we anticipated we should get when the industry was first nationalised. For that reason I think that there is no need for a Royal Commission, that there is certainly no need for denationalisation, and that if we give the present Commission the chance to continue as they are doing now, in a very short time we shall be glad that the system was nationalised.
§ 5.12 p.m.
§ LORD TEVIOT
My Lords, before I begin my speech I want to put to the noble Lord on the Front Opposition Bench a question which I hope he will be able to answer. It has been said in another place and also outside Parliament that if denationalisation takes place and there is a change of Government and the present Opposition come into power, they will immediately again nationalise transport. I want to ask whether noble Lords opposite have that intention, because, so far as my own mind runs on this subject, it is a matter of the greatest possible importance. I do not hold quite the optimistic view that my noble friend Lord Leathers seems to hold, that we shall get people into the transport business with this Sword of Damocles hanging over their heads, because they would have only until the next Election, unless we got back into power—and, please God, we will! Looking at it from a business point of view, I cannot see myself, for instance, going into the road haulage business in those circumstances. Therefore, having spoken to the noble Lord, Lord Pakenham, before the debate began, I wonder whether he can give me a direct answer to this question: if denationalisation takes place and the result of denationalisation is proved to be satisfactory—with reduced fares, a new impetus to industry, assistance to the export trade, and so on—will the Labour Party, when the term of government of those on this side of the House is over, immediately nationalise the industry again? I should like an answer to that question.
§ LORD LUCAS OF CHILWORTH
I am grateful to the noble Lord for his question. I think what he had better do is to read what I said in Hansard. My noble friend Lord Pakenham did mention this matter to me before we came into your Lordships' House. What I think the noble Lord has to consider is this. I said that it is no use noble Lords opposite pointing the finger of scorn at us—
§ LORD LUCAS OF CHILWORTH
No, but you say that if we reverse this policy we are wreckers of the national interest. Equally, we can just as well say 1073 that, through reversing the policy of the last Government, the present Government are wreckers of the national interest. It bits both ways. I think the noble Lord will have to obtain what solace he can from my exact words and the exact words in this connection of my right honourable friend Mr. Herbert Morrison. Beyond that, I can only quote the wards of one who used to be a great leader of the noble Lord: you must "wait and see."
§ LORD TEVIOT
I rather anticipated that I should not get a definite answer to my question. That statement has been made, and I come to the conclusion that noble Lords opposite are not prepared at the present time to say that they will do as was suggested by Mr. Morrison in another place, and also I think by the T.U.C.
§ LORD LUCAS OF CHILWORTH
That would be a very foolish assumption for the noble Lord to make. The noble Lord is quite as capable of forming his assessment of statements made as anyone, else. It would be safer for him to do that, and not to assume one thing to the other.
§ LORD TEVIOT
I thank the noble Lord for what he has said, but he has not yet answered my question. I give it up.
§ LORD TEVIOT
I am sorry that the noble Lord, Lord Greenhill, has gone, because I should like to answer an observation he made just now. He said that my noble friend Lord Leathers, when dealing with the policy produced by this Government, was stating some political idea of getting away from nationalisation and back into private enterprise. There is no politics in this matter at all. Looking at the situation realistically, I am certain that what is at the back of my noble friend's mind is the desire to relieve the country from great loss and bad service, and to try to help industry to reduce prices for exports. So far as I can see, this is one of the ways in which that can be done. As I think my noble friend said, nobody can dispute the fact that losses have been very great and that the results of nationalisation are not satisfactory. There is no doubt whatever on that point.
§ LORD TEVIOT
Anybody who travels on the railways or goes about on the roads can repudiate the idea of the noble Lord opposite, that nationalisation has been a great success.
§ LORD LUCAS OF CHILWORTH
Let us get this matter clear. I do not want to mis-quote what the noble Lord has said. The noble Lord said that the Transport Commission had lost a lot of money. If there has been a loss of money it has been on the railways, but the noble Lord and his Party do not propose to denationalise the railways. If the argument is based on nationalised transport being a money losing proposition, why not denationalise the railways? Why not put them up for auction?
§ LORD TEVIOT
It is very difficult to make a speech. The noble Lord was "ticked off" by the Leader of the House just now, arid I wish the noble Marquess were here at the moment. One cannot develop any argument with the noble Lord bobbing up and down the whole time. Let me give him a little information about which, no doubt, he is quite aware. On authority that I do not dispute, I understand that in 1950 the figure was £14,000,000 down; in 1948, only £5,000,000 down, and in 1949, it jumped to £20,000,000—I am talking about losses. The total over the whole period amounted to £40,000,000, and we have now had enormous increases in fares and freight charges. Any Government coming into power who had the welfare of the country at heart could not avoid immediately doing something to try to relieve the nation of such a burden. That, I am sure, is in the minds of my noble friend and in the minds of the Government, and that is why I support 1075 them and not noble Lords opposite. The noble Lord, Lord Lucas of Chilworth, no doubt travels on the roads a good deal, and he must have noticed how many empty lorries there are about. That is a situation which must be dealt with. One used not to see those vehicles going about empty in the old days—the "bad old days" I suppose noble Lords opposite would call them. I think the noble Lord, Lord Lucas of Chilworth, in the course of his speech asked: Who will run the schemes which are going to be set up?—at least that is what I understood him to say, and I took his words down as they came from his mouth. I will tell him this, in answer to his question: it is certainly not going to be a case of "Jobs for the boys." The noble Lord knows perfectly well what I mean.
I should like now to tell the noble Lord something apropos of what happened to me about a year ago in Glasgow. One early morning, when I was about to travel by train to Edinburgh, a porter spoke to me. I did not know his politics, but he told me that whereas in the old days there would have been four porters doing a particular job there were now sixteen. I said to him: "You do not really mean that?" He replied: "That is so. Everything here is chaotic as the result of over-staffing." The noble Lord rather suggested that nationalisation had reduced the numbers of employees.
§ LORD TEVIOT
It struck me that that was the suggestion which the noble Lord made. I am sorry if I am mistaken, but that was certainly what I gathered from his remarks. Another matter mentioned by the noble Lord was standardisation of engines, and he certainly seemed to think that that was a great thing to have accomplished. I have heard from friends of mine who have knowledge of railways and who have studied this question that there is ground for criticising this step. They tell me that powerful engines are now drawing comparatively light trains which could easily be drawn more economically by smaller engines better suited for the purpose. They suggest that the standardised engines should be kept for the purposes for which they are 1076 best fitted and that other services could easily be run with diesel engines or some other type of smaller engine. So it seems to me that there is no great credit to be taken by reason of this standardisation.
The noble Lord also said a word or two about class-consciousness. The existence of that is a pity. He said that the noble Lord, Lord Kirkwood, had made a speech here the other day which we all applauded. I only wish that I had been here to hear it. I read the report of that speech in Hansard with great interest and I heartily approved it. The spirit which was expressed in it is the spirit I want to see made manifest on the other side of the House, and, generally, in the Party which noble Lords opposite represent. I have appealed to noble Lords before, and I repeat that the great thing we must aim at is unity of purpose in the future. With regard to this question of class-consciousness, I am glad that the noble Lord who opened this debate recognised that a splendid spirit was shown by my old friend, David Kirkwood. If only everyone in the country would follow that out and deal with these questions in that spirit, we should soon find a great difference in the state of affairs.
May I ask the noble Lord a question? I entirely agree with his support of Lord Kirkwood's speech. But what is the noble Lord complaining about? That is what I am not clear about.
§ LORD TEVIOT
What I have been complaining about is that, so far as I can ascertain from reading the newspapers which report fully the remarks of members of the Socialist Party—Members of Parliament and others—that spirit is not generally shown. The noble Lord knows that.
§ LORD TEVIOT
I only mention the matter. I know, of course, that noble Lords opposite do not like it. They never like the truth. I am telling the absolute truth. If the noble Lord would like me to do so, I can send him exhibits in support of what I have just been saying. It will be quite an easy matter to find them.
I wish I had received an answer to my first question, because it seems to me that 1077 it is one which has to be taken very seriously into consideration in dealing with this immense problem in the future. With the enormous demands which exist for all types of transport in this country and with properly managed arrangements for conducting it efficiently, it should undoubtedly produce a profit instead of losses such as have recently been shown. We cannot afford to go on taking these enormous risks. I know that noble Lords opposite do not like hearing these criticisms.
§ LORD TEVIOT
You are—very well then, that is all right. Here is a gigantic piece of business that is not being run successfully to-day. It is all very well to say that before nationalisation things were not satisfactory. My noble friend, Lord Teynham, I thought, struck the right note when he said that the railways had experienced very difficult times, not only in the last war but in the preceding war, and that they had never had the opportunity to recover. I believe that when this question is dealt with by this Government your Lordships will find eventually that denationalisation of road transport will be followed by denationalisation of the railways, and the railways will get a fair deal, which, in my view, they have not had for many a day.
I thank my noble friend, Lord Leathers, for his most comprehensive and enlightening speech. I feel that we should, if we can, eliminate politics altogether from this subject. It is not a political question and it never ought to be treated as one. The Opposition Party rushed into this, and the noble Lord opposite said just now that we gave no reason for going back to private enterprise. So far as I can see, there is every reason. This undertaking at present is a ghastly failure. We want to put it right, and I believe that we can and will do so, because we shall get the right methods and the right brains. There is no doubt that users of transport to-day are very worried about the situation. They are not satisfied with the present state of affairs and they only hope to goodness that somehow or other—and I believe that it will come about—we shall gradually drag the transport industry out of the terrible mess it has got into as a result of the policy of noble Lords opposite.
§ 5.29 p.m.
My Lords, the White Paper in its first paragraph says that in the view of Her Majesty's Government the Transport Act of 1947 has not achieved its avowed purpose. I entirely agree with that statement, but I do not think one would be fair in leaving it at that without first of all asking two questions. The first question is: Have we given the Transport Commission a fair chance—that is to say, time enough to prove whether or not they are working on the right lines? Secondly, have they, by the results they have so far achieved, shown that, given more time, they will be able to reach and achieve their avowed purpose? I think it is important to put these two questions and to answer them with absolute fairness. I am encouraged by the fact that many speakers have questioned the purpose of the Government in introducing this White Paper at all. Unless those questions are fairly put and fairly answered, the Government lay themselves open to the criticism that they are more concerned with ownership as an end in itself than with ownership as a means of providing the best possible system of transport for this country.
I put those two questions to myself and I am satisfied that I am being fair when I contend that the results so far do not justify leaving matters exactly as they stand to-day. My noble friend Lord Leathers brought out that fact clearly when he said that customers were being served less well. I should like to add that there are many employees of the British Transport Commission, from the top right down to the bottom, who have been untiring in their efforts and in their enthusiasm, and undoubtedly much has been done during the last few years to make good wastage of one kind or another, to overtake the lack of repairs during the war years and to effect many economies. Having given all the praise one can where praise is due, can one really say that there has been the dawn of a new era of transport for this country, in keeping with present-day demands, as regards both passenger; and goods, and in keeping with the present vital necessity to avoid waste of all sorts—waste of manpower (we discussed that last week), of material, of effort and of time; unnecessary duplication, frustration, and unwillingness at times to be frank and expose short-sighted vested interests?
1079 It is because I am satisfied that we are not working on the right lines that I welcome the publication of this White Paper. I welcome it as timely. Does it really get down to fundamentals, or does it tend to perpetuate some of the underlying handicaps from which transport may be suffering? There are many references in the White Paper which I welcome as decidedly encouraging, but I must admit to one or two misgivings in certain directions. For example, I welcome paragraph 8, which states the general principle that private enterprise is regarded as the most suitable exponent of road haulage policy, and this, as it says, will mean the eventual elimination of the 25-mile limit. As an objective, I think that is excellent, and I am sure that it is right. But at the same time I have doubts about the practicability of what I read as meaning the almost immediate dissolution of the Road Haulage Executive. It seems to me that it would be better if the dissolution of the Road Haulage Executive could come about by allowing private enterprise an opportunity to prove its own case.
I am afraid that the political uncertainty which has been mentioned by many speakers, due to what I regard as somewhat irresponsible threats in different places, may prevent private enterprise from being able to give of its best. As my noble friend Lord Sandhurst asked, shall we get people to come forward to buy all these undertakings? More important perhaps, shall we get the best men to come forward as purchasers? I am not entirely happy about that. I would repeat what many other noble Lords have said, that transport should never have been allowed to become a matter of Party politics. However sincere noble Lords opposite and their supporters may be, I feel that they did a great disservice to this country in bringing that about. I do not feel that the Party to which I belong was responsible for introducing bitter Party controversy into this question of transport.
Can we retrieve that position in any way? It will certainly not be easy. A possible way of retrieving the position would be, instead of offering the Road Haulage Executive vehicles straight away for sale to private tender, gradually to 1080 stiffen the licensing conditions under which the Executive's vehicles operate and at the same time gradually relax those under which private vehicles operate, so that eventually they could all operate together on comparable terms. I listened with great care to what my noble friend Lord Leathers had to say on that point and from a financial point of view he put clearly the difficulties under some such system as that. I see these difficulties, but at the same time I think it is a point that still should be given consideration.
I was glad to see from the last paragraph of the White Paper that it is intended that the Commission's goods vehicles should come within the licensing system of the Road and Rail Traffic Act, 1933. I regard that as very important. In suggesting a gradual transformation from nationalised road haulage to private enterprise, I may be laying myself open to the criticism of tending to create such a surplus of road haulage capacity as would add still further to the grave difficulties of the railways. That may be so, but I believe that it could be kept under control, or influenced by licensing authorities in the future. Virtually, we have two separate transport systems in the country, one superimposed on the other—a road system and a rail system, either of which alone could carry a major part of the whole demand. What does that mean? As I see it, inevitably it means a considerable measure of waste. Does it not also mean a measure of hidden subsidy (as one might almost call it), resulting in excessive charges? It may also mean—and I know it does, at times—exceptionally wide and welcome choice for some users. But is that not, to some extent, a luxury which, under the present difficult economic conditions in which the country finds itself, we can hardly afford?
We hear a great deal these days about the need for ruthlessly cutting down Government and private expenditure. Is it not possible that here, also, the question of cutting down should apply? It means, of course, that the users must be prepared to forgo some of the variety of choice to which they have been accustomed in more prosperous times. Obviously we must maintain the railways in as efficient a condition as possible, not merely for strategic reasons—that is paramount—but also because I believe that, given the 1081 right conditions, they offer a valuable form of transport in peace, though not necessarily in the form in which they are to-day or in the form in which they have grown up from the time when the only other ancillary form of transport was not the bus or lorry but the horse. I know that the Transport Commission have been pursuing a policy of cutting out redundant branch lines, stations, and installations of one kind or other. But progress in that direction, probably through no fault of the Commission, has not been as great as it ought to have been, for the simple reason that there have been strong local objections. We ought to bear in mind that these local objections have not in any way been influenced by political considerations: they have come just as much from supporters of noble Lords opposite as from the supporters of noble Lords on this side of the House. I feel that a great deal more could have been done to cut out redundancy had it not been for local vested interests of one kind and another.
If I may give an example of the sort of thing I have in mind, in the county I know best, Lancashire, there were in the old days something like four or five—there may even have been six—separate railway companies. It is inconceivable that, as a result, there are not to-day many types of installations—stations, marshalling yards, sidings and so on—which are still duplicated, which for one reason or another cannot be co-ordinated and from which the redundant ones ought to be cut out. I believe that a great deal more could be done in that direction. It would save overheads and costs, and the matter is therefore urgent. But here again the process is bound at times to be inconvenient to certain users, so it is unlikely, without some measure of Party political agreement, to be pursued with that energy which it demands.
Taking that background of streamlining our railway system, I certainly welcome the proposal in paragraph 11 of the White Paper for increased decentralisation. That obviously will be a stimulus to a measure of rivalry, and, in particular—one noble Lord asked what sort of rivalry one could possibly have that would be to any advantage—to rivalry in research, if nothing else. That does not necessarily mean that we have to do away with all wise forms of standardisation—I think we can have both going together. 1082 I welcome even more the proposal in paragraph 14 of the White Paper that:The Commission will be given greater latitude to vary their charges schemes.…I believe that that is really getting down to the fundamental matter. But why cannot it go a stage further? After all, the process was started before the war when, I think, the Transport Tribunal of the day authorised the system of what were called "exceptional rates." Why cannot we carry it further and give the railways complete authority in their own sphere without need to refer to the Transport Tribunal? And why not take the matter even a stage further, as my noble friend Lord Teynham suggested, and relieve them either of the whole or part of the responsibility of being regarded as common carriers? Why were the railways ever made common carriers? It was simply because in those days they had a complete monopoly of transport. The noble Lord, Lord Lucas, referred to this point when he spoke, and he poured ridicule on the suggestion. But if it is not possible to remove altogether the obligation as a common carrier, I am certain that it would be possible to go a long way towards relieving the railways of that responsibility. If that can be done, there are plenty of types of traffic for which the railways can be highly competitive: there are various types of long-distance traffic, both for goods and passengers, suburban traffic round London, and other types. There might be inconvenience at times for some users. Special arrangements would have to be made for the type of traffic which nobody wants; and some special arrangement would have to be made in the transitional period when the railways first had their freedom. But I believe that on those lines alone we shall arrive at a healthy system on which the railways can freely and profitably compete with the roads.
That brings me to the contentious point of the levy. I dislike the levy—although my noble friend Lord Leathers went some way to assist me on this point—because I see it as tending to perpetuate the railway system in its present form, and, more particularly, if it is to be adjusted every three years. We read in the White Paper:Secondly, the expansion of road haulage will no doubt result in some further transfer of traffic from rail to road which cannot be offset by countervailing economies in railway operation.…1083 Further down, paragraph 16 says that some provision will have to be made to counterbalance that. The difficulty I have in accepting that statement is that, whereas some countervailing economies are obvious, some are much more obscure. What inducement would there be for the railways to search out for the most obscure of those economies; and who is going to say whether they have been sorted out or not? Therefore, I am rather afraid that the levy might tend to en- courage the status quo in the railways, which I do not like at all. However, if the Government would think again on the lines I have tried to indicate, I believe that the whole question of the levy might itself be found to be redundant; and, therefore, the matter would not arise. That is all I have to say. I am afraid that in certain aspects I may have been somewhat critical. However, I welcome the White Paper, because it points in the right direction. I wish the Minister well, and I sympathise with him in the difficult problem that he has inherited, not from his immediate predecessor but from those there before him.
§ 5.50 p.m.
§ LORD WINSTER
My Lords, the noble Lord, Lord Leathers, came under some rather sharp fire this afternoon while making his speech. Not merely his matter but even his method of presentation came under criticism. I am sure the noble Lord recognises that he belongs to a particular section of the Government which is under very heavy criticism at the present moment and I feel that an opinion is growing that reform of the overlords is even more necessary than reform of the Lords themselves. But I must confess that I was rather surprised at the intervention of the noble Marquess, the Leader of the House, to complain about the questions and interruptions which had been put to Lord Leathers in the course of his speech. Our system of carrying on the public business of this country is by debate, and surely it is the very negation of debate to protest against perfectly orderly interruptions, put forward for no other reason than to elucidate vexed points in order to assist the whole House to follow more closely, with greater competence, what is under discussion. When I heard the noble Marquess claim it as a merit that that 1084 side of the House had listened to a controversial speech in perfect silence, I really could not help thinking that that may not have been entirely due to a spirit of courtesy, but may have been due to an inability to interrupt the speech or to controvert the points which were being made.
§ LORD WOLVERTON
May I interrupt the noble Lord to say that I was longing several times to interrupt the noble Lord, Lord Lucas, on several points? But having been in this House now for some years, I have found that it has not been the practice to interrupt speakers during the course of their speech. I think the noble Lord did interrupt too much.
§ LORD WINSTER
I must say that I have frequently heard interruptions of speeches in this House. Provided they are orderly and proper interruptions, I cannot for the life of me see why the slightest exception should be taken to them.
§ THE CHANCELLOR OF THE DUCHY OF LANCASTER (VISCOUNT SWINTON)
If I may venture to interrupt—
§ VISCOUNT SWINTON
My noble Leader is not here, and I should like to say this. It is all a question of amount. Both in this House and in another place—I think the noble Lord, like myself, has been a member of both—the process of debate is usually conducted by speech answering speech, and not by a duet with an occasional chorus.
§ LORD WINSTER
I note what the noble Viscount has said, but I think that debate is now showing a tendency to be carried on not by a process of speech after speech but by a process of reading brief after brief. I repeat my point, that I think it is the very essence of debate that orderly interruptions to elucidate a particular point of importance are a perfectly proper and, in fact, a necessary feature. As I have mentioned this, perhaps I should say that nobody considers more heartily than I do that the noble Lord, Lord Leathers, is quite able to take care of himself regarding questions which are put to him in the course of any speech that he may make.
1085 My purpose in rising is to call attention to one feature of this White Paper which has not so far been touched upon, and in fact it is only vaguely referred to at all in the White Paper. I am sure that the noble Lord, Lord Leathers, will agree that what I am going to say is relevant to the White Paper. I would ask the noble Lord: has he gone into the question of what will be the effect of these proposals upon the coastal shipping industry? That industry has already enough problems to face. Competition is increasing in the Baltic and in the North Sea. The existing position is causing some perturbation to those interested in the industry. I am sure the noble Lord will agree that, before the war, the coastwise shipping industry was very nearly ruined by cut-throat competition from other forms of transport. I believe that the integration of rail, road, canal and coastwise shipping which was aimed at by the last Government certainly held out a measure of hope of establishing an equitable rate structure for the coastwise shipping industry, whereas I fear that what is proposed to-day may revive the old competition, depress coastwise shipping and so adversely affect wages and conditions.
Apart from those considerations, coastwise shipping is of great importance to the nation, because it has, of course, considerable strategic importance. I believe that this question of the coastwise shipping industry is under consideration in Geneva at this very moment. I would ask the noble Lord whether the coastwise shipping interests on all sides were consulted in the course of the preparation of the White Paper or, if not, as may well have been the case, is it intended to consult them at some time in the future about the effects of the White Paper upon that industry?
§ LORD LEATHERS
My Lords, I can only imagine that the noble Lord was not present in the House all the time that I was speaking—I could forgive him for that. But at one time I did make a special reference to coastwise shipping and referred to my own experience of it. I said that we shall be only too ready to take that into account and to receive their points in connection with it, and see how the thing can be worked out.
§ LORD WINSTER
I am most grateful to the noble Lord, and I apologise to him at once for having unfortunately not fully comprehended that portion of his speech. Another matter to which I should like to refer very briefly indeed has reference to the railways. I regret what the White Paper says about the railways, because I regard it merely as a sort of throwing in the towel and saying: "No, it is hopeless. The railways can never be expected to pay." An argument seems to be developing that what really matters is to decide which is the most efficient way in which they should not pay—is it the most efficient thing that they should not pay under private enterprise, or that they should not pay under State ownership? That seems to me very much a sort of Tweedledum and Tweedledee battle—under which system shall they lose their money? I, for one, do not think it impossible that the railways should pay their way. In the course of their existence the Railway Executive effected many great economies, and I believe were on the way to effect yet more.
While I think they effected economies, I could not bring myself to say that I always think they effected a great improvement in efficiency and punctuality, to give only one instance Unpunctuality has been becoming steadily the rule rather than the exception, and any complaints or remarks about unpunctuality to the authorities have come to remind me of the remark made by an Italian stationmaster when he was confronted by a British traveller who was furious at finding the Grand Express drawn up two hours and twenty minutes late in a tiny little wayside station in the north of Italy. When the traveller complained to the stationmaster, the stationmaster said: "Why talk to me about it? I live here. I do not want to go anywhere." It seems to be in that spirit that one's complaints nowadays about unpunctuality are received. I believe that by continuing to cut out uneconomic services and by many other improvements—I will not dilate upon them because they have been touched upon already in his debate—and above all by securing co-operation in all grades in promoting economy and efficiency (and we are bound to confess that the results in that direction have been rather disappointing: we have not had the results from those policies of co-operation that we should have liked), the 1087 railways could yet be made to pay. But I must confess that I am astonished by the system under which it is sought to promote competition between railway services while demanding of the roads that they should subsidise their competitor, the railway. That seems to me to be a remarkable form of competition indeed.
Finally, I wish to say this. I feel I am only one of very many people who are perturbed by what apparently lies before us in the conduct of some of our major industries. The two-Party system of Government, as I understand it, is supposed to have the great merit that it gives a certain amount of continuity in the carrying on of the government of the country; and we make it a source of great and legitimate pride that our foreign policy and our defence policy are almost entirely bi-partisan. We regard that as one of the features which make for great stability in the Constitution and in the conduct of our affairs. But when we come to the economic affairs of the country, the economy upon which all depends—because what is the good of having a good foreign policy and a good defence policy if you have an unsound economic policy by which the country seems to be going downhill?—the idea seems to be quite different with various Governments. There seems to be a prospect of our arriving at a state of affairs when every change of Government will witness a change in the method of running the business and industry of this country. What are we seeing in regard to transport? A process of nationalisation and denationalisation and a plain intimation that there will be renationalisation with the next change of Government. Although I have not yet heard it said from the other side, I should not be surprised if we got a corresponding intimation of re-denationalisation when the Party opposite once again comes into power. Is this really the way to run the industry of this country? There is an old saying that while the doctors argue, the patient dies; and this process will, I believe, have that effect upon our industries.
Two of our basic industries lie under this threat at the present moment—steel and transport: the two industries upon which at the present time all the other economy of the country rests. Take the 1088 question of transport which we are now debating. I am sorry I have not the reference with me, but I am thinking of President Truman having set up a commission to inquire into how far the cost of transport enters into the price of articles. I am almost afraid to quote this because, as I say, I have not the reference by me, and because the figure seems so great; but I believe it was stated by the Commission that this cost entered into the price of articles to the tune of something like 70 per cent.—that is, into the price of all articles, not of any particular class of article. Steel, as we all agree, is the very basis of our trade and commerce. Yet here we have these two great industries, steel and transport, under the threat of this process. I believe it is the case that doctors will tell you that the new system of shock treatment for lunatics is proving very effective: that they are getting very good results from shock treatment given by alternating currents. But if we are to apply this shock system to the industries of this country, while it may be a good way of treating lunatics, it is a lunatic way of running our economy.
§ 6.5 p.m.
§ VISCOUNT RUNCIMAN OF DOXFORD
My Lords, at the first reading of the White Paper, I shared the apprehension to which the noble Lord, Lord Winster, has just given utterance, about the complete absence of any reference to coastal shipping—an industry which, after all, is no inconsiderable part of the transport system of this country. It employs well over 1,000,000 gross tons of ships—a figure which can be little if any less important than the figure quoted by the noble Lord, Lord Lucas, in connection with the road transport industry.
While it was comforting to hear Lord Leathers' reference towards the end of his speech to coastwise shipping, I was not sure at the end whether he was still of the same mind as I think he was when in this House some years ago he said that we must be careful, in planning the co-ordination of road and rail, that nothing is done to impede coastal shipping from fulfilling its full function. I could not help wondering whether he felt quite the same when he was engaged in co-ordinating unplanning. However, I take it from his remarks that in the 1089 main he did, and that those who are more closely concerned with that part of the shipping industry than I am will be able to settle this matter on the basis of the consultations which the noble Lord was good enough to offer.
I should not have taken up your Lordships' time (nor shall I for more than a few moments), were it not that a question of considerable importance about the general organisation of transport in this country seems to me to have been raised by a great deal of what has been said in this House this afternoon. The White Paper on the subject of road and rail transport speaks of some measure of competition, and there has been a great deal of talk about competition in general throughout this debate. But what I was not able to gather, and what I hope the noble Viscount who is to reply will deal with, is the extent to which such competition is to be what is generally called "regulated competition," and how far it is to be a sort of "free-for-all." It is undoubtedly true that great economies result from competition in general, but it is equally true that violent instabilities may result if this competition is pushed too far over limited fields and over short periods of time. If competition is in the public interest, so is stability. It seems to me difficult to imagine any transport system dependent upon the provision of regular and scheduled services, whether they be by road, rail or sea, or in the air, without at the same time some arrangement for ensuring at least a moderate stability of rates.
Far be it from me to defend the Transport Act of 1947; but so far as coastwise shipping is concerned, it did have, through the Coastal Shipping Advisory Committee, a salutary effect in the regulation of coastal rates and in their relation to the rates charged by road transport and also, to some extent, by rail transport. The coastal shipping industry was not nationalised, but there was a certain co-ordination that was in and not against the public interest; and it would be helpful to know how far it is the intention of Her Majesty's Government that this sort of consultation and harmonising will continue to be a feature of our transport system, and how far they think it can be usefully modified or stimulated by such measures of competition as they are now introducing.
1090 I should like to say only one more thing, again about coastwise shipping, and again in this connection. The noble Lord, Lord Winster, referred to the importance of coastwise shipping in our national defence. That is not a matter which any noble Lord is likely to overlook, least of all the noble Lord, Lord Leathers. I am not suggesting, and I do not think that anybody else would suggest, that it is the proper function of a transport system to perform what are really the jobs of defence by stimulating, for warlike purposes, systems and units of transport which are inappropriate, or even uneconomical, in time of peace. It does not follow from that, however, that the Government should not be at considerable pains to see that a mode of transport so necessary in time of war should not be allowed to die merely because it does not, instantly and immediately, fit into a highly competitive picture in time of peace.
I am far from pleading that coastwise shipping should receive the sort of consideration that should be given to the railways, and the last thing any of us would ask for is a levy to enable us to meet more readily the competition which must be expected from the roads. If we are to maintain sufficient coastwise shipping to meet the undoubted needs of national defence, I think it will be necessary to ensure that there is some stability of employment for coastwise ships and that the Government do not, by introducing suddenly a severe measure of competition, discourage people who are already finding it difficult enough to replace their tonnage—which in a large number of cases is already old enough to need replacement—from getting on with the job with some feeling of confidence about the future. These people have no right to ask more than that they shall be allowed to earn an honest living by their own effort; but, equally, I think this country owes them no less than the opportunity to do that.
§ 6.13 p.m.
§ THE EARL OF LUCAN
My Lords, the noble Lord, Lord Beveridge, in a very striking, informative and constructive speech, referred to this White Paper and the policy that it foreshadows as "a leap backwards into the dark." The situation to which this White Paper points is all too clear. It is not at all shrouded in doubt. It points back to the old days of 1091 lack of control and cut-throat competition. Your Lordships will remember that, over a hundred years ago, this tragedy was played out for the first time when the original form of transport, the main form of heavy transport, the canals, was fought and beaten by the railways. That resulted in an incalculable loss of capital assets to this country. The same thing has happened in the twentieth century with the railways and their competitors, the roads. Are we going back, under the influence of what the noble Lord, Lord Leathers, described as "beneficent denationalisation," to complete, unrestricted competition? The White Paper talks about the transport system beingstimulated to adjust and develop itself in accordance with public needs.There never was a transport system until the Act of 1947. Until then, there was nothing but a haphazard collection of private enterprises that sprang up in different parts of the country, unrelated to each other and unrelated to the national needs, entirely at the whim of private profit. It was only when the course of events showed clearly that closer control was necessary that this collection of transport agencies was welded into a proper transport system.
Now, Her Majesty's Government tell us that the Act has not achieved, and is not likely to achieve, integration. On what evidence do they make those statements? This system, instituted only four years ago, has only just begun to get going. The process of taking over the road haulage and other agencies takes time, and it is only now in the last year or so that anything of the results or the success or failure of this system can be judged. The first point I would put to your Lordships is that it is completely unrealistic to judge this system on such a short experience. I think competent people in the transport world would say that one would want twenty years to see the results of a reorganisation of the nature and the scale of the 1947 Act and get the ultimate benefit.
On this question of integration, I found a most illuminating and an extremely able definition of what the co-ordinated transport system ought to be. It was in a speech by the noble Lord, Lord Teynham, made two years ago. He defined it as follows: 1092A properly co-ordinated system would be one in which each form of transport was able to render those services for which it was economically and technically best suited.That I call a most admirable definition of "integration." Are we to suppose that that integration will be achieved by what the noble Lord, Lord Leathers, calls "practical and businesslike methods"? Those methods that are foreshadowed in the White Paper sound to me more like an economic jungle. Moreover, there was recognition, long before the Labour Government came in and long before the Transport Act, that some restriction on methods of transport was necessary. The Road and Rail Traffic Act of 1933 recognised clearly that unlimited, unrestricted competition could not be tolerated in this country. We could not tolerate the enormous increase in commercial traffic on the roads. There was an ominous ring about the statement of the Secretary of State that carriers' licences would be more freely granted. Most of your Lordships know the roads of this country, and know the amount of heavy traffic that they carry now. The roads system, which has been only slightly modified from the stagecoach days, is expected to carry this enormous tonnage—and what is the result? It is not only a matter of 5,000 or 6,000 people killed every year and many more thousands injured, but it is a bill in hard cash that has been estimated at £150,000,000 a year in road accidents alone. To turn commercial traffic loose on the roads is going to increase the toll of accidents and slow up the remainder of the traffic on the roads.
The Transport Commission, who have been operating for some four years, have had before their minds all the time their statutory duty, laid down under the Act, which was to promote integration. We have heard a great deal about their failings but we have only to look at their reports for the two years 1949 and 1950 to see that a considerable amount has been done in the direction of integration. We probably all hoped that they would achieve a greater measure of success in that time, but many factors have operated against that; one is the natural ignorance of the general public, which is easily played upon by propaganda such as a document I have here protesting at the closing down of the St. Marylebone Goods Depôt in London. It is a neatly got-out little roneoed sheet issued by the 1093 local Communist Party, and it seizes on the fact that some 400 railway employees will lose their jobs at St. Marylebone. It does not explain that the elimination of this depôt is part of the measures of economy that the Railway Executive have found necessary. Wherever the Railway Executive have proposed to remove any facilities that they offered, immediately and in every case there has been a storm of protest from all sorts of interests, none of whom had any constructive suggestion to offer. That is one of the factors which has slowed up the elimination of unprofitable traffic and unprofitable branches.
There is another factor which is less reputable; it is not due to ignorance, but, I regret to say, it is due to prejudice. The Transport Commission in their Report for 1950, say:There have been many instances where the Road Haulage Executive has taken over undertakings only to find that the main customer or customers will no longer give their business to British Road Services.That is a case of plain political prejudice which has gone far to hinder the Transport Commission in their efforts to carry out their duties. Obviously there have been other factors—the restrictions on capital, the shortage of materials, and so on. But do not let us think, and do not let it be thought from what has been said in this House to-day, that nothing has been done by the Transport Commission to carry out their duties and that no success has been achieved in the direction of integration and economy.
I should like to say a word about the proposed sales by open tender to private enterprise of the Road Haulage Executive undertaking. I understand from the Secretary of State's speech that no reserve will be put on these lots when they are put up to auction. Possibly some people may think that his optimism about the demand there will be is misplaced. That cannot be foreseen. I am no business man, but one knows of the shop that puts in its windows "Clearance sale. Everything must be sold," and one knows that that is a clear invitation to go in and get things at bargain prices. I think for Her Majesty's Government to deal in that way with the taxpayers' assets is a most irresponsible action; it is dissipating the resources of the country. Also on the matter of the Road Haulage Executive, there was some exchange be- 1094 tween my noble friend Lord Lucas and the Secretary of State on the question of redundancy of staff. I think the Secretary of State was under the impression that the Road Haulage Executive was more lavishly staffed than under private enterprise. Lord Lucas has told us that on taking over the Executive found that there was redundant staff that could be got rid of, and in the year 1949–50 I notice that although many undertakings were taken over and the traffic carried increased from 27,000,000 tons to 46,000,000 tons the staff employed by the Executive increased only from 67,000 to 75,000. It does not lock to me as though there was any undue inflation of staff in that direction.
May I now turn to the railways? This decentralisation is claimed to introduce healthy rivalry between the new railway areas and to correct the excessive centralisation which, it is said, has been caused by the Transport Act. The Transport Act, far from excessively centralising, broke down the four original railway regions into six. If Her Majesty's Government propose to break these down into smaller areas one wonders how they will work and, as other noble Lords have said, how competition is going to be achieved. Are we in favour of a system whereby small towns, like Barnstaple, shall have two different stations and for the two lines serving them to compete with each other for traffic? Some other towns are served by several railways. Can we, in the situation in which we are at present, afford this lavish provision of means of transport? They are to have "greater latitude" over their charges, but it is not clear from the White Paper how much discretion, how much latitude, there will be among the areas for fixing charges. Will the Scottish area, for instance, fix a different fare for Edinburgh to London, from the fare for London to Edinburgh? If Dr. Johnson is to be believed aboutThe noblest prospect which a Scotchman ever sees,one can imagine higher charges being put on the southward journey.
Again, what about the question of standardisation—we have not heard much of that—and whether these areas are to be allowed freedom to design and build their own locomotives and rolling stock? Shall we see the depôts at Eastleigh, Swindon, Doncaster, and the rest, each competing with all the others in building 1095 small numbers of locomotives for their own lines, and with enormous loss and waste of effort? I hope we shall hear something by way of an assurance from the noble Viscount that standardisation of material, which has made great strides and is showing very promising results, will not be lost sight of. My Lords, at this late hour (that is the conventional phrase at this hour of the evening) I hope I have said enough to pick up a few of the points. But I should like to add that we on these Benches feel most uneasy, to put it mildly, about this White Paper, which we regard as a very sketchy, poorly thought-out performance, one which might produce some short-term effect but has no relation to the long-term problems which will always be with us.
§ 6.32 p.m.
§ VISCOUNT HAILSHAM
My Lords, I must not be diverted from my original purpose, which was to offer some slight criticisms of the White Paper, into dealing with some of the very controversial points which were asserted without much evidence by the noble Earl who has just resumed his seat. But, I think, there are at least two questions upon which it would be fair to take him up. I have often diverted myself with the speculation as to what would have happened in the beginning of the railway era had Socialism then been the dominant political philosophy. We have heard the answer this afternoon. We should have had immense pressure from the stage coach pioneers to preserve our magnificent system of Macadamised roads, horses, carts, posting stations, trumpets and other obsolete paraphernalia. The noble Earl went even further. As I understood him, he was for restoring our grand old system of canals which preceded stage coaches. I understand the noble Earl's conversion to Socialism has been nothing more than an intense form of conservatism, which he might well have inherited from his noble forbears.
So far as we on these Benches see it, the objection to nationalisation is, of course, not that it is progressive, but that it is intensely, and to an ossified extent, conservative, precisely because it is in favour of the return to the stage coach, mutatis mutandis, and our grand old canal system, and all the rest of the be- 1096 loved outmoded forms of transport which the noble Earl defended so eloquently. We rather fear that nationalisation is not in the best interests of progress in this country. Then there was another extraordinary aspect of his speech, what I call the politically mythological part of it. I was so astonished at his words that I took them down as best I could. According to him, there was no transport system in this country at all before 1947. There was only a spirit spreading across the face of the water which created the Act of 1947. There was only (I quote): "a haphazard collection of private enterprises unrelated to the public interest"—and something else which did not catch up with. The whole of the rest of the legislation in the last century was ignored. The whole complicated system of the Railway and Canal Commission, the Railways Acts, going back to 1837, culminating in the Act of 1921, the transport licensing provisions of the 1930's, all meant nothing to the noble Earl, who reverts to the status quo ante, the establishment of the canal system which preceded the stage coaches in this country.
These particular excursions into mythology have offered me, at any rate, a point of departure from what I was intending to say, because it is a remarkable and, to me, deplorable fact that both great Parties of this country spend, I should think, seven-eighths of their time in arguing about the rival merits of private enterprise and public enterprise, as it is called. The rival merits of those two great systems really have very little to do with the real economic and political questions with which this country is faced. Indeed, the public are interested in this very largely ritual savagery between the two Parties only by the development on each side of this particular political mythology which attributes to private enterprise nothing but chaos, and to public monopoly nothing but inefficiency.
In my humble belief, the truth is that there are certain enterprises, such as the sewers, which are far better run by the public. There are others, such as hairdressing, which could hardly be relegated to monopoly, because individual tastes differ so very widely. In between these two extremes there is a debatable ground, part of which we are discussing this afternoon. But the ugly truth which 1097 will presently emerge is that between a really well-run private enterprise and a really well-run public monopoly there is precious little to choose. It is untrue that private enterprise believes in "cutthroat" competition, or chaos, or the disregard of the public interest—
§ LORD BURDEN
Will the noble Viscount address his remarks to the Secretary of State, who opened this debate on behalf of noble Lords opposite?
§ VISCOUNT HAILSHAM
I hope, indeed, that the Secretary of State will listen to my remarks. That brings me to my next point—namely, that I apologise to him for not having listened to his. Unfortunately, I was sent for on urgent business almost at the moment when he rose, and as some of my remarks are intended to be critical of the White Paper, I hope that I may not have missed some of the arguments for it by the necessary abstention that was imposed upon me.
But, my Lords, there is debatable ground in regard to which there is really precious little to choose between the really well-run private enterprise and the really well-run public monopoly. At least, in my humble belief the greatest part of the political controversy in which Parties are engaged redounds to the great misfortune of the country as a whole. I personally think—I know noble Lords opposite will not agree with me—that among the very worst subjects chosen for nationalisation originally was the road transport industry of the country. Indeed, the only really plausible argument for it that I ever heard was that advanced by the noble Earl who has just resumed his seat—namely, that it was a great pity that we ever got rid of our stage coaches, and that we might at least weight down the scales of justice in favour of the railways before they disappear altogether in the heat of competition from the roads. That view has a certain speciousness about it, but I think it is the only argument in favour of the control of road transport in the first place. It does not, of course, necessarily follow that because the nationalisation of road transport was originally a blunder of the worst kind, its denationalisation at any particular moment, or at all, is necessarily the correct policy to pursue.
1098 It seems to me that that is the real point which ought to be discussed in this debate. I myself have some doubts about the matter. I do not for a moment wish to defend (because it seems to me to be the worst of all possible attitudes) the advance statement of the Labour Party, that they will re-nationalise if ever they get back into power. As the noble Lord, Lord Winster, indicated, I think that is both unpatriotic and undemocratic and also, in the end, subversive of Parliamentary government. If at the very moment they get into power every Party are going to spend their time undoing everything that their predecessors have done, we shall soon find Parliamentary government impossible. Not only is that an argument against denationalisation; it is also an equally powerful argument against announcing in advance that you propose to re-nationalise. Quite obviously, any Government faced with such an announcement in advance are bound to tell the Opposition that it is for the moment Her Majesty's Government, and not Her Majesty's Opposition, who are going to dictate policy, so far as policy can be dictated and not imposed by reason.
I confess that I feel certain doubts about the wisdom of denationalising road transport at this stage. The doubts which I feel are both on practical grounds and on principle. It is, of course, true that denationalisation of road transport was in the Election Manifesto. But I have always thought that when a Party is returned with a small majority its attitude towards its own Election Manifesto should be coloured to some extent by political realities. I, at least, can claim the credit for having said that before this debate, for I said it on the occasion of the debate on the gracious Speech from the Throne. I am not sure, therefore, that the fact that this proposal was in the political Manifesto is conclusive. Secondly, I believe that it will be difficult to find purchasers for a denationalised institution at the present time, quite apart from Mr. Herbert Morrison's threat in another place which, it seems to me, was designed to sabotage the sale when it came—and a very unpatriotic thing it was to do. Quite independently of the question of want of patriotism in some of the leaders of the Opposition Party, there will be a certain difficulty in finding purchasers for a denationalised institution at 1099 a time when denationalisation is obviously a matter of acute public controversy. The tenure which can be offered by any Government, in such circumstances, quite apart from any threats by the Opposition, must necessarily be a doubtful security, and that fact must necessarily depress the price.
I wonder whether the correct method of approach is to offer the entire assets of a large industry in such circumstances to public tender. Supposing it is, I still feel that there are other doubts to be expressed. It is manifest—indeed, it is admitted in the White Paper—that the process will involve the Government or the Commission in a good deal of loss. Is it desirable to impose a heavy loss on a public institution at the present time? Is it just to seek to recoup the loss by imposing a levy on goods vehicles, not all of which, on any view, will benefit by the proposed change? I myself have not been convinced by these arguments. I must finally add this. I have not been convinced that there was not at the hand of the Government a very much more prudent method of approach, even upon the assumption that it was necessary, or at least desirable, to denationalise the road transport industry. Their major premise in the White Paper is that they propose to increase the road services. I know that that does not meet with the approval of the noble Earl who has just resumed his seat. Being more diffident about such matters I assume that it is a correct major premise.
§ VISCOUNT HAILSHAM
I do sometimes bicycle, which renders me more allergic to heavy goods vehicles even than I should be as a pedestrian. But, assuming for the purposes of this argument that the premise of the White Paper is correct, would it not have been possible for the Government to proceed cautiously, by allowing some of the additional services to be put out to public tender and on to the old "A" licence system, instead of submitting the entire assets of the Road Transport Commission to public auction? I am not convinced that that would not have been a more cautious way of approach. Supposing it had been done, and supposing it had been done successfully, it would, at any rate in my opinion, 1100 have been more difficult for the Labour Party to undo what was done. It would have been very much more difficult to make a plausible case for undoing such an Act. Moreover, if, in competition with a public monopoly, private enterprise did succeed, what a splendid argument in favour of private enterprise that would be.
For these reasons, I feel a little critical of the White Paper, and I wonder whether perhaps it would not be a wiser course of action to have second thoughts about it. I hope that I may be forgiven for expressing a purely personal point of view, but I have been very much concerned to see a Conservative Government in this country for a number of years. I think that is what the country needs, and I think the reason it needs it is that what the country requires at the present time is a period of competent administration, without an undue measure of controversial legislation, designed to put this country back into the position which it ought to hold in the councils and economies of the world, by restoring our economic position and by restoring our political prestige. I believe that in these two latter tasks Her Majesty's Government have been notably successful. I believe that they will be further successful if they continue in office. But I am not sure that it will be possible for them to continue in office if they take upon themselves the burden of a number of controversial schemes dictated primarily by a doctrinaire approach to what I believe to be fundamentally an irrelevant issue—that of public enterprise and private monopoly.
§ 6.46 p.m.
My Lords, I find myself very much in sympathy with what the noble Viscount who has just sat down has been saying. I remember that when the Transport Bill first came into this House we had a long debate on Second Reading on the principles of private and public ownership, free enterprise, nationalisation and so on. Many of us, even at that time, expressed the opinion that it did not really much matter who owned the concern, but that it did matter very much how it was run. That, to my mind, is the point which lies at the back of all the questions of importance relating to transport and nationalised industries generally with which we have 1101 had to deal. I feel that in the White Paper the opinions expressed are not, perhaps, quite the kind which one would like to see. I see very little which leads us to hope that there is any belief that the railway service is going to survive successfully. Most noble Lords, I think, will agree that we must have a railway system in this country. I should like to see some expression of policy, some attempt to create conditions under which the railways will operate successfully. Then, surely, the road transport system can fall into its place.
Are there not many things in railway legislation which really call for reconsideration? I refer to the restrictions which have been placed on the railways for many years. There is the question of the obligation to carry which has been discussed by your Lordships, the questions of limitation and variation of charges, liability not to give undue preference, and so on. And there is a Transport Tribunal which, although it is in a new form in the present Act, is a descendant of the earlier organisation which was instituted in earlier times, as were so many of these pieces of legislation, for the protection of the public and of traders. Of course, it is too simple to say that this shall all be swept away piecemeal, but I think that conditions have changed so much that it would be well worth trying to think again how to arrive at a more satisfactory situation—how, for instance, to have regulations or Acts of Parliament varied in such a way as to promote an agreement on rates structures between road and rail which, after all, was not so far away before the war. On those conditions, surely there could be competition for service and efficiency between road and rail.
A railway system demands the ownership and management of a large number of local road transport delivery services, and I think it would be a great mistake to sell off nearly all the local delivery services at present belonging to the Road Haulage Executive, as proposed in the White Paper. Many of these could well be integrated with the railway system. Indeed, it is one of the criticisms one may make of the present Act that, although it aims at integration, it does not allow a close enough unit of management locally. I believe that "Executives" as defined 1102 in the Act are wrong and that there should have been regional or sub-area Executives. I am sure that there would have been better results if, for operating purposes, these had under their command the short-distance haulage and also the hotels, docks and inland waterways in their regions. I am one of those who believe in division on a geographical basis rather than on a functional basis, and I am inclined to think that events show that that is probably the right view. In the White Paper it is said that there is too much centralisation. While one cannot deny the advantages up to a point of standardisation and common policy on engineering design, construction and similar matters, it seems to me that there is a clear case for giving a great deal more autonomy to those in charge of geographical regions. I hope that that will be done as suggested in the White Paper, and also that serious consideration will be given to the alteration of the Act so as to remove the emphasis from these functional Executives and place the responsibility for transport operation in the region as a whole upon the regional Executives I suggest.
I should not like to see the whole of the road services immediately sold. I believe it is too early to do that. Many of the criticisms of the road haulage services could be removed by reducing the road haulage units to smaller size and attaching them to the area or regional administration. However, I believe that there is a good case for getting rid of the main long-distance haulage units. It would not be impossible to make arrangements whereby these could be sold as going concerns, as many of them were before the Act and as many of them more or less remain. A fair attempt at competition between the long-distance road haulage system and the railway system with its ancillary short-distance haulage seems possible, and that would be an experiment well worth trying. To go so far as that would need alteration of the Act, but I think that might be done without any very acute controversy. There would be differences of opinion, no doubt, as there always are, but I should like to see something of that sort as an experiment, with the common agreement that whatever the resultant Act of Parliament, it could always be improved. I think that those who were behind the present Act are bound to agree that it has a good many deficiencies.
1103 I am sorry that a levy on road haulage is proposed, because I think that that is a very bad principle. It is all very well to say it is not a tax but a levy, but to the operators it is exactly the same thing. Once started, any levy, tax or imposition can always be kept on after its original purpose has gone. Although the levy may not amount to very much on each vehicle just now, it may well become more: but it is the principle about which I feel so unhappy. I do not think it right that operators on "C" licences should pay this levy. A trader operates on a "C" licence because he can provide himself with a more efficient service than he could obtain from any other system. Under the White Paper proposals he will have to pay the levy, and it is not enough to answer that he can calculate whether it will pay him or not. He will have to pay it and will get no advantage from the companies who buy the other parts of the road haulage system and operate them outside the 25-mile limit.
I also feel unhappy about the levy because I look on it as a subsidy to the railways. I do not believe we shall ever make the railways independent and put them well on their feet unless they feel they are able to finance themselves. The right thing to do is to make circumstances such that they can pay their own way, to give them more freedom to get rid of obligations that are onerous, close down unremunerative lines and give up some services. As the noble Lord, Lord Lucas, said, it is not easy, but I believe it is only on these conditions that the railways can run properly. It is a pity that we have this proposal for what in effect is a subsidy to the railways. It is the first time any subsidy to the railways has been proposed in this country. I hope the Government will think a little on this White Paper before they introduce legislation. Something ought to be done to improve the present haulage system, but I think we are going a little too far at one jump in this proposal.
§ 6.59 p.m.
My Lords, the noble Lord, Lord Lucas of Chilworth, said very little about the transport user. In thinking out this problem, we ought to start with first principles and ask ourselves whether the scheme put forward in 1104 the White Paper will benefit the customer—and by "customer" I mean practically the entire industry of this country. I believe most definitely that this scheme would benefit the customer. I do not propose to give any examples of the loss of efficiency under nationalisation, but I think the fact that manufacturers and traders are not getting the service they require from the Road Haulage Executive is instanced by the fact that the number of "C" licences has risen from 500,000 to 800,000. Unquestionably the service required from road haulage is of a very personal and individual nature, and I do not believe that service can be given by a large nationalised body such as the Road Haulage Executive. The noble Viscount, Lord Ridley, has said that people are using "C" licence vehicles because they can have their goods delivered more cheaply by that means. I do not think that is the reason. I believe that it is because only by using "C" licence vehicles can they assure supplies coming into their factories on time and finished articles reaching their customers at the right moment. For those reasons I feel that the object of the White Paper is entirely sound.
Having said that, I must add that, when we come to how it is to be done, there are one or two points about which I am not completely satisfied. I am not satisfied that we are going to get the bids for these vehicles at the right price or, what is equally important, from the right people. It is essential that the people who take over these vehicles should be experienced road haulage men. It is a fact that, since nationalisation, certain of the biggest and most efficient operators are no longer in business here. I know of one who migrated to Canada, and two of his sons went to Rhodesia. I should feel happier if we could be told that some reserve was to be put on these groups, to ensure the right price, and also that some care will be taken that they are sold to people whom the Government are satisfied will do a good job. I also feel that in certain cases—it is not a new system under private enterprise—the Transport Commission should be able to operate some of their vehicles, as has been done by the railways for many years in the past. The levy is quite a new conception. All I say about it is that I believe there should be a delay of one year before it is put into operation, in order that there 1105 may be opportunity to see how it works. I would just remind your Lordships that the Road Fund is collecting something like £330,00,000 a year, whereas the roads are costing only something between £60,000,000 and £70,000,000 a year to keep up.
I turn, shortly, to the railways. I, too, hope that in reorganising the railways on a regional basis the specialised divisions will be abolished. One thing that has been mentioned today is the financial competition. But there is another form of competition—namely the rivalry of prestige which existed under the old four main-line railways The fact that you could advertise that the Great Western Railway had put on an observation car, or that the new streamlined train on the London and North Eastern Railway was improved, was of great importance; and it also meant improved individual service from those four companies. I hope that the same spirit will develop when we have decentralised regions, and that the people in the regions will feel that their region is twice as good as any other. Apart from financial competition, that is most important.
I should like to mention one thing that is perhaps somewhat irrelevant. I think that a mistake has been made in doing away with the monthly return fare. I mention that only because I believe that, in the long run, it will cause a loss. The number of unused monthly return tickets I sometimes find in my wife's dressing-table shows that the railways must make a great profit out of at least one of their passengers, and that could probably be multiplied one hundredfold. I am surprised that there is little mention in the White Paper of passenger road transport: beyond a statement of past history in paragraph 4 passenger road transport is hardly mentioned. I should have liked to hear that more power was being given to the licensing authorities to give private passenger road transport operators a fair deal in competition with those services which have been nationalised. There was an instance the other day (I am not questioning that the Minister was perfectly right in his interpretation of the 1930 Act) whereby, on appeal, a most efficient long-distance operator had his licence for a long-distance service to Scotland cancelled—or, a any rate, it will be cancelled after the end of this season. Subject to 1106 those few criticisms, I support in general the whole principle of this White Paper.
§ 7.8 p.m.
§ LORD OGMORE
My Lords, I do not think that in modern times any Government measure brought forward with a great flourish of trumpets has ever received from the public generally, and from its own side particularly, such a cold reception as has this one. Practically every noble Lord who has spoken in this debate has condemned it, either in general terms or in particular terms. On the other side of the House, Lord Ridley, Lord Runciman and one or two others whose titles for the moment slip my memory, damned it with faint praise: the noble Viscount, Lord Hailsham, damned it without any praise at all. He, in fact, is only repeating what Tories outside have said about this Bill. Only last night one of the London newspapers carried a report on the annual conference of the Transport Salaried Staff Association, now meeting at Folkestone. Mr. G. A. Tempest, a Euston traffic railway controller and member of the National Council of the Conservative Party, announced that, although a lifelong Tory, he was resigning from the Party as a result of the Government's policy on road haulage. Furthermore, he called upon all his colleagues in the transport industry who are still Tories to recant. Whatever effect that has on the noble Lord, Lord Leathers, who has come rather late into political life, it will, I am sure, cast a gloom upon the spirits of the noble Viscount, Lord Swinton, a very experienced politician, and also the noble Lord, Lord Woolton, who has Guided the fortunes of the Conservative Party with some success in recent years.
This White Paper is a friendless orphan, shivering in the icy blast of public opinion, and I can think of no other course for the Government to adopt, in view of the debate to-day, than to withdraw this White Paper.
§ LORD OGMORE
I have one supporter in the noble Viscount, Lord Swinton. We must anticipate that that will be done. Nevertheless, in case the noble Viscount's opinion is not unanimously welcomed in the Cabinet I feel that I must continue with my speech and not end there. The noble Viscount, 1107 Lord Hailsham, in what was a most interesting speech—in many cases a sound speech, but not entirely—pointed out what in fact I was going to point out, but he did it much better, namely, that as the times through which we are passing are serious times the public are looking for sound administration by the Government and not for the doctrinaire approach which this projected measure envisages. I am sorry that the noble Viscount, Lord Hailsham—and I am sure he expressed himself in the way he did only in the ebullience of the moment; he did not mean it at all—made comment on the leaders of the Labour Party and criticised them as unpatriotic.
§ VISCOUNT HAILSHAM
What I said was that the attempt to sabotage public opinion by announcing in advance that, whatever happened, the policy would be reversed if the Labour Party got into office, was unpatriotic. I see no reason whatever to modify that statement.
§ LORD OGMORE
The word "unpatriotic" is obviously rather a wide term. We usually regard is as meaning giving aid and comfort to an enemy. The noble Viscount does not mean that, I know.
§ VISCOUNT HAILSHAM
What I mean by "unpatriotic" is simply that it is not designed in the interests of the country; it is designed to sabotage by extra-Parliamentary means the authority of Her Majesty's Government—in other words, it is animated by unworthy and unpatriotic motives. I do not mean in face of an enemy in war; I simply mean that it was unpatriotic. And that is what it was.
§ LORD OGMORE
The Tory Party always regard as unpatriotic anything they do not like. I would point out that when the steel measure was passed, the Tory Party who were then in Opposition said that when they got into power they would reverse the process. We did not call them unpatriotic. We called them many things, but not that. May I point out that the present Financial Secretary to the Treasury, speaking g a Tory Conference, warned people who were engaged in the steel industry and in industry generally that if the Tories came into power the Steel Act would 1108 be regarded with great hostility. They were not the words he used, but they were words of that kind. Therefore, I think the less we use words like "unpatriotic" the better. My right honourable friend in another place intended to leave the possible purchasers of these assets in no doubt whatsoever of what would happen when the Labour Party got back. That might be said to be honesty and not unpatriotic.
§ LORD OGMORE
May I say that I sympathise with the noble Lord, Lord Leathers? In the past he has been a great businessman and he has done great deeds, especially in war, for which the country is grateful. But what have the Conservative Party turned Lord Leathers into? From a perfectly honest businessman (and I am not one who says a businessman cannot be honest) they have turned him into an overlord of disorder and a co-ordinator of chaos—because that is what he is at the present moment. Only a fortnight ago, as my small son was going back to school, I went to the railway station on a Monday, to buy him a ticket for the following Friday because part of the arrangement of the railway system is that if you want to send a small boy to school and to send his trunk in advance you have to buy a ticket in advance, otherwise they will not trust you, however good your credit may be in other directions. The great railway system in this country was unable to tell me what the cost of the ticket would be and was unable to issue a ticket for the following Friday. To such an extent has this great system been reduced by the present Government and the present Administration, that they could not even quote the price of a ticket five days in advance. The noble Viscount, Lord Hailsham, has made great play with Lord Lucan's reference to coaches. But I am convinced that in the coach era you could buy a ticket five days in advance if you wished, and Conservatism and this Government can actually be described, as he described it, as "back to Methuselah."
There is a distinct difference between the Parties, and I want your Lordships to understand that we are at the parting of the ways in many respects in this White Paper. Hitherto, and certainly in 1945—as I am sure the noble Viscount, Lord 1109 Hailsham will agree; he and I were then on opposite sides in another place—the argument was not really whether there should be co-ordination of transport but whether that co-ordination should be carried out under a public authority or under private enterprise. That was the real argument in 1945. All members of another place and, I believe, all noble Lords in your Lordships' House—both the great Parties of the State—were quite convinced that it was necessary to have co-ordination. We have now gone back to the very early days of transport in this country. If in Tory annals the present era is known as the Churchill era, we have gone back to vintage, primitive Churchilliana—to the very early days of the Churchill times, when Mr. Churchill was fighting the Khaki Election. We have gone back before his Liberal days when he believed in nationalisation, when he advocated nationalisation of the railways and other industries and, in fact, so far as Uganda was concerned, he advocated the Socialist State to a far greater degree than anything we have to-day.
My noble friend Lord Lucas asked the Government three questions. He asked, first: What was the necessity for the Government's decision in this case? He asked, secondly: What investigations were made before the decision was arrived at, and what consultations there were with the British Transport Commission. Thirdly, he asked whether their proposals wore the best possible in order to carry out their purpose. I listened with great interest to the speech of the noble Lord, Lord Leathers. His answers were these. Did he consult the British Transport Commission? No, said Lord Leathers, he did not, because it was not their job to handle broad policy—it was the Government's. But surely on technical matters of this kind one cannot conjure policy out of the empty air. You do not make policy in a vacuum. Before making up their minds the Government should have found out the facts, and from whom could they have found that out better than from the British Transport Commission? Did he make any investigation into the affairs and operations of the British Road Haulage Commission? The answer was, No, he did not. His answer to the question, "What was the necessity for the change?" was: 1110 that things were so bad that it was essential that there should be a change.
The noble Lord, Lord Rochdale, in his interesting speech, posed a question. He asked whether there was a real necessity for the change and whether there was real evidence that such a change was necessary. When he came to answer himself, the evidence that he gave for making up his mind on his own question was thin. But still, he did ask it, which is more than anybody in the Government did. As my noble friend Lord Lucas has said, the Road Haulage Executive have been in the saddle for only one year. Before that they were getting prepared and making the necessary arrangements to run properly. They have been running for only one year. I ask noble Lords opposite—many of whom have had great experience on private business—how can you judge the affairs of a great organisation after only one year of effective running?
§ LORD OGMORE
Well, I know it has been in existence for three years. The first two years were pretty well taken up in making the necessary arrangements, and I understand that last year—the figures, it is true, have not been published—they made something like £3,000,000 profit. Perhaps the noble Viscount, Lord Swinton, will confirm that or otherwise. There is no doubt about it, from investigations such as one can make in a private capacity such as mine, that the service is getting better every day. I think it is clear that in fact the present Government had made up their minds before they came into office that they were going to do much as they are now doing, and that it did not very much matter whether the British Road Transport system was being effective or not; they were, as the noble Viscount, Lord Hailsham, implied, so actuated by a doctrinaire spirit that they were going to tear down the edifice which had been so painfully erected during the last few years. What was the necessity for the Government's decision? The noble Lord, Lord Leathers, has replied that the only necessity really was that they gave an Election pledge—and this is possibly the only Election pledge that they may be able to carry out. He went so fast that it was 1111 not always easy to gather what he said, but if he did not mean that, I can only say that this was a fair assumption to be drawn from the practices of the Government in this respect.
I want to ask a few questions of Lord Leathers, and of the Government. We are told that the increase in the "C" licences was a measure of the traders' dissatisfaction. Is it not a fact that the increases in "C" licences were for the 15 cwt. and 30 cwt. trucks, and that, so far from being a measure of the dissatisfaction of traders, it is the best possible evidence of the success of the Labour Government and of the great assistance they have afforded to the small trader? The small van is carrying things which in the old days were carried by the errand boy riding, as the noble Viscount, Lord Hailsham, does, a bicycle. And so it is an overwhelming example of the success of Labour policy, and not at all an example of the dissatisfaction of the traders.
The next question I want to ask is this. We have been told by Lord Leathers that it is impossible to extend the limit of 25 miles for the "C" licence holders. This is one case in which he did consult the Road Haulage Executive, and they told him that it could not be done and that it would wreck the whole system. Is it not a fact that this was one of the electoral pledges of the Conservative Party? Did they not say in their electoral manifesto, Britain Strong and Free, that they would do this? Why have they not carried it out? Why have they thrown this into the limbo, with many other examples of broken Tory promises? The noble Lord spent a quarter of an hour in demolishing his own Party's case and in proving that the Tory Party would not carry out their promise. It was a promise which may in certain areas have had a considerable effect upon the return of their Member. There was great dissatisfaction amongst certain classes of traders on certain of these points—we give you that. There were traders who had been affected adversely, and no doubt they helped the local Conservative candidate.
§ VISCOUNT LONG
May I interrupt the noble Lord for one moment? He has been making references to "C" licence 1112 holders, but does he not mean "A" or "B" licence holders?
§ LORD OGMORE
Yes, of course, I meant the "A" licence holders. The "C" licence holders I mentioned with regard to the 15 cwt. vans. I am grateful to the noble Viscount for his intervention. My next question is whether there will be a reserve price on the units to be sold. That is a very important point, but I will not labour it because it has already been dealt with effectively. It seems to me quite possible that there will be a ring of buyers and that, in fact, no reasonable price will be obtained in an auction. Such things have often been known before and, indeed, such cases are probably more frequent than cases in which there are no rings. I think that this may be a great drawback to any fair or reasonable price being obtained by the Government.
Then there is the question of the regional basis, the areas for the units. Are the people who buy these units to be allowed to career around the country going into any area in which they have a small customer or even one small transaction? Who is to run the units unsold? Who is to be the residuary legatee of "old iron"? The Government or whoever are concerned will find themselves at the end in the position of having to run a fleet of transport consisting of nothing but "junk," and to carry on business in parts of the country where no private enterprise concern will operate. Who is going to pay the compensation—the Government or the British Transport Commission? Finally, what is the position of the Railway Hotels Executive? The fact that there are so many questions unsolved, and so many questions that I have not mentioned because they have already been dealt with by other noble Lords, including supporters of the Government on the Benches opposite, show how "half baked" this scheme is. My own great objection, apart from some minor ones, is that there is no coordinated plan for transport. This is really defeatism, as has been said. This White Paper describes itself as a statement of transport policy. But there is no transport policy in it.
The noble Viscount, Lord Runciman, who has had such great experience of shipping, pointed out in his interesting 1113 speech that there is nothing about coastwise shipping, yet it comes very much into transport policy. There is nothing about air traffic. I hope the noble Viscount, Lord Hailsham, will not put me back with the canal advocates when I say there is nothing about air in this White Paper. Here we are on the verge of a great air age, when there is a network of services in this country operated both by the Corporations and by private enterprise, when B.E.A. is on the threshold of new helicopter services radiating from all parts of this country to London and from London to the Continent, and yet there is nothing about it in the transport policy of this country. As I say, it is early Churchill at its very worst and not, unfortunately, the later Churchill who believed in co-ordination and in national planning.
It is no good saying that there will be no friction. There is friction already, even in the nationalised industries. It may surprise noble Lords to know that British Railways have refused to accept posters from B.E.A. because there is competition between the two and it would affect their travellers. There is going to be far more friction when they turn back a good part of this industry to private enterprise. I can see that the air side is going to be very adversely affected, because they have not the big pressure groups, the interests, that these vast organisations such as road and rail have. I am afraid they are going to be crushed out unless the Minister is very strong, and I do not see how he can be very strong when he has to balance two balls, one in each hand, one so heavy and the other so light.
I am coming to the end of what I have to say. I suggest that the Government are like a bather. They desire to plunge into the river of free enterprise and free competition but, instead of plunging in, they dip a toe into the water and then shrink back. As the noble Viscount, Lord Hailsham, in his interesting speech said or implied, it is very difficult in these days to have real private and free enterprise. The real private enterpriser would say: "Set the people free. Strike off the shackles. Let the natural abilities of our people have free play." But the Government have not done anything of the kind. This project in the White Paper is not a plan for private enterprise at all. It is nothing to do with 1114 free enterprise. This is private monopoly, not free enterprise. If it was going to be free enterprise, they would not have maintained the "A" and "C" licences. In free enterprise there is no reason why anybody should not run a lorry anywhere. Why have "A" and "C" licences? Why have any licences at all? Why subsidise the railways to the tune of £4,000,000 per annum by their competitors? Where, in any private enterprise State, where, under any theory of free competition, does one competitor subsidise another? Finally, the Conservatives used to call us, as a term of derision, a "Government of planners," as "planning" is a term of abuse in the Conservative dictionary. I say that this Government is a Government of spanners—
§ 7.33 p.m.
§ VISCOUNT SWINTON
My Lords, the noble Lord who has just sat down has given us an admirable example of the way in which, when there is very little to be said for the system and the business you are defending, you can put up a number of ninepins that exist only in your own imagination, and knock them down. I have not a great deal answer in the points which have been raised. Frankly, although I listened with the greatest attention to the noble Lord's speech, I really do not think I have anything at all to answer in that—except perhaps one thing. He, as other speakers did, asked me why we had not, before we decided on our policy—not on the details of its application but on the policy—consulted the Transport Commission. That is a thing, he said, the Labour Government would never have dreamt of doing. May I ask the noble Lord this question? Before he decided upon his policy in the last Government, and before he introduced the Transport Bill, did he consult the Road Transport Federation or any of the other bodies which were concerned with transport? Of course he did not; and I am not complaining.
§ LORD OGMORE
I did not gather that that was a rhetorical question; I thought it was factual. If it was a factual question, I personally had nothing to do 1115 with the Transport Bill, but I am quite certain that those in the Government at the time who were concerned with the Transport Bill consulted all interests who could give them valuable information.
§ VISCOUNT SWINTON
Really, that is most interesting. I take note of it and I have no doubt that the Road Transport Federation and others will be interested to learn of this revelation of history: that before the Labour Government decided to nationalise road transport and announced their policy, they took careful counsel with the road transport organisations. I am greatly interested to hear it. The Bill which was introduced in another place seems to have been a very odd outcome of that consultation. If that is all the value of consultation and what it has led to, then really we can hardly be told that we should have consulted the Transport Commission at that stage. The noble Lord, of course, is quite wrong in his facts, but I do not complain that he is, because policy—no doubt the noble Lord would hardly accept this statement because he accepts the principle: "I am the leader; I must follow them"—is a function of government, and the decision of policy is a function of government. On the application of policy you want a great deal of practical advice. I am perfectly certain that if we had gone around hunting for somebody to give us a policy, like Japhet in search of a father, he and his colleagues would have been the first to twit us for not knowing our own minds. But we do know our own minds quite well about this matter.
The noble Lord who opened the debate in a long and remarkable speech posed some questions with which I will deal. At the same time he said that he, at any rate, knew what the motive was: that the whole of this policy was just to give road haulage back into private hands. The noble Lord, Lord Greenhill, went a little further. He said it was "to give it back to their friends." Small minds look for small motives and small and unimaginative objectives. I can tell them at once what our aim and object was. Our aim has been to see how we can best make the whole of transport serve the national interest, whether it is railways, roads, docks or coastwise shipping—all of those are necessary and all 1116 are covered. And our approach to this matter has not in the least been theoretical or ideological; it has been practical.
Personally—I have often said so to this House—I have never held any academic views about nationalisation. I want to see whatever system will work best, and by "work best" I mean give the best, most economical and most efficient service. If it is right to leave an industry nationalised. I should leave it nationalised. I think it is quite right to leave the mines nationalised. But if nationalisation of an industry has proved demonstrably wrong and injurious to the whole community, as has without a doubt the nationalisation of road transport, then I say it would be quite wrong to leave that industry nationalised. I am bound to say that when the noble Viscount, Lord Hailsham, passed from the more entertaining to the more constructive or, should I say, destructive part of his speech, I thought his argument was a little disingenuous, or at any rate was too clever for me, in my simplicity, to follow. He said that nationalisation was quite wrong. He said that the nationalisation of road transport had been a grotesque failure. So it has. But then he said: "But you must not go and denationalise. What you should do is to keep on the nationalised organisation, losing lots of money and rendering bad service to the community, but bring in a competing organisation, which the Road Transport Commission themselves have said they could not compete with if it were brought in, in order to show that nationalisation will not work. Then you will have converted people against nationalisation." I am bound to say that is a bit too clever for me.
§ VISCOUNT HAILSHAM
Possibly because the noble Lord has not accurately stated what I said. I neither said anything like that, meant anything like that nor could be understood as having said anything like that.
§ VISCOUNT SWINTON
I certainly so understood it. I shall read the noble Viscount's speech with interest tomorrow. Perhaps he praised the nationalised system—I think not.
§ VISCOUNT HAILSHAM
I do not want to make my speech again, but evidently the noble Viscount wants me 1117 to explain. I said, in the first place, that I regarded nationalisation of this industry as being peculiarly wrong. Secondly, I said—arid I still see nothing in what the noble Viscount has said to interfere with it—that it does not necessarily follow from the fact that nationalisation was a blunder, that denationalisalion is not, in the circumstances, a blunder, too.
§ VISCOUNT SWINTON
We must try and find a third way, and I am bound to say I de not see where the third way lies. The noble Viscount certainly said that he would introduce some competing element which would succeed whereas the other would fail. I repeat, frankly, that is a great deal too clever for me. If we are satisfied—as we are and as can be demonstrated beyond a peradventure—that road nationalisation has done the greatest possible disservice to the trade of this country at a critical time when it is vitally important that trade and industry should be well served, then it would be extremely cowardly and wrong not to denationalise it. I leave it there.
§ VISCOUNT HAILSHAM
If the noble Viscount is going to leave it there, perhaps I may say that he has again repeated what I did not say. My suggestion was that if it is true, as the Government have said in their White Paper, that it is desirable to increase the services in some way, it might be desirable to assign the increased services to private enterprise without destroying the Road Transport Commission. It may be too clever for the noble Viscount, but he ought at least to get it right the second time.
§ VISCOUNT SWINTON
Now the noble Viscount has said exactly what I have twice put to him. I shall be on record to-morrow, and so will he. If this thing has failed—and we all admit it has failed—
§ VISCOUNT SWINTON
If it has failed—and certainly in our opinion and in the opinion of every trader it has failed—then he says: "Leave the thing which has failed in existence but bring in a 1118 competing organisation with it." I say that that would be wasteful and foolish and a cowardly and wrong thing to do.
The noble Lord opposite has spoken a great deal about "integration." Really the noble Lords are hypnotised by words. It all depends upon what you mean. It is just like co-ordination; co-ordination is all right if you get the right man in the right place—and Lord Leathers is an admirable example of the right man in the right place. Really, to use the word "integration" as if it were a charm is the act of either a simpleton or a charlatan—and certainly I will not say which it should be. What do you mean by it? In practice, what integration has meant has been a conglomeration, a piling everything you can collect on a heap; you have had size and centralisation, the folly of grandeur and, incidentally, the suppression of all competition, and higher rates all round. The only thing that everybody, or nearly everybody, is agreed upon is that it has not worked in practice. I do not say that that is the Transport Commission's fault. I do not think it is. I think you gave them an absolutely impossible task to do. The last thing that you should integrate, the thing that above all depends upon flexibility, personal service and being able to offer what is wanted at any time to any customer, is road haulage. As regards size—and this goes for the railways as well—anyone with practical experience knows that one of the worst dangers you can have in a business is letting it get too big. If the business is homogeneous it is risky enough—the old railways for example, were big enough; a great many people think they were too big—but it is absolutely fatal when you combine in one vast organisation—or disorganisation—a large number of businesses of infinite difference and variety.
The noble Lord, Lord Beveridge, who is not here—I know he had to go—said: "We must have action How are we to get it? Get action by a Royal Commission." You cannot wait for that. That would satisfy the noble Earl, Lord Lucan, except that he would think the Royal Commission came too soon, because he said we must have a period of twenty years to try the thing out. It may be all right to have a nationalised business, but the taxpayer cannot go on losing money 1119 for twenty years—and no other sort of business would stand that. Why should we have a Royal Commission when we know the facts and know what we intend to do? There is only one thing which requires further inquiry—which should be as rapid and effective as it can be made—and that is the relation between railway passenger transport and road passenger transport; that, we admit and say frankly, does require further investigation. But that is no reason why we should not go on with all the other things that can and should be done. It would be unreasonable to expect every detail of decentralisation and improved management to be given in the White Paper or even in the Bill. The essential question surely is: are the principles right? The application of those will be worked out. When you come to the details of decentralisation of railway management, which we regard as absolutely vital, there it would be wrong to set yourself down to an absolute, sealed pattern in a Bill from which you could not depart. As a matter of fact, it will probably require to be modified from time to time in the light of experience.
Let me take the principles and see whether they are right, because it is upon the principles that this White Paper and this policy rests. We say that the existing organisation is too big. I wonder whether anybody in his heart really denies that. We say that the existing organisation is too uniform. I agree entirely with what my noble friend Lord Ridley said. I can promise him that when we come to decentralise we mean to have real decentralisation, and not to continue the functional control which goes the whole way down. That, to my mind, is the negation of decentralisation. Not only is it too big for efficiency, but this bigness inevitably breeds uniformity. What we need is local experience, varied initiative and the old local pride. It was not just a jest when people called the Great Western Railway "God's wonderful railway." It may have been a bit of a laugh at it, but at the same time there was a good deal of justifiable pride behind these humorous sayings. Another principle is this. I would say, as a maxim: Only centralise where you must; decentralise wherever you can. Do not just decentralise where you cannot avoid it.
§ LORD GREENHILL
Would the noble Viscount define the word "centralisation," giving his own definition and not necessarily committing the Government?
§ VISCOUNT SWINTON
I will give my own definition. I believe that you should control at the centre only those things which must be controlled at the centre. It may be said that that is general.
I do not want to keep the House too long, but as this is the first run-over that we have had, I may have to speak at some length. Take labour conditions. Those must be uniform. You have to have centralisation in that, although in a great deal of labour relations you need decentralisation. Finance certainly has to be centralised. You could not have a Scottish region which might be very much out of pocket and losing money carrying on its functions with a region which is making a great deal of money. I believe that by decentralisation we shall see a good deal more making of money on the railways. When you come down to everything that can be decentralised, you can have local initiative and different practices and trials, in running one region against another—the manager of one region may consider that a particular system of shunting, or whatever it may be, whether the matter is technical or commercial, is better than another. It is in that regard that I want to see the individual initiative and individual experience of the local management tried out. Have I made that clear?
§ LORD GREENHILL
Yes. But I still do not see why you cannot combine central direction with a decentralised carrying out of the functions in certain areas. I do not see that it is necessary to make all this fuss, decentralising the whole of the undertaking, presumably with watertight compartments and some kind of tenuous link between those compartments, instead of running from a centralised core, leaving a certain amount of freedom to each of the decentralised parts.
§ VISCOUNT SWINTON
By "decentralisation," I mean exactly what has not been done so far in this nationalised industry. What we have had in the nationalised industry so far is the maximum of functional control at the centre. I have a great deal more to say. I do not ask the noble Lord to agree with me, 1121 but I think he will admit that there is all the difference in the world between his ideas and mine.
§ VISCOUNT SWINTON
If there is not, then I am quite delighted. We shall both go forward together, and he will support the proposals for decentralisation when they come forward. But I do not want that uniformity of function or of technical direction always to come down from the centre. I hate watertight compartments.
§ VISCOUNT SWINTON
Then we are at one. I am delighted. But if we are at one, the noble Lord must denounce the way the business has been run hitherto.
§ THE EARL OF LUCAN
May I ask the noble Viscount whether he thinks there was decentralisation and local initiative in the old railway companies?
§ VISCOUNT SWINTON
There certainly was much more than there is to-day. I could give hundreds of examples of it, but I do not want to speak for more than two hours.
§ LORD BURDEN
We only want an explanation. This first run-over is very important, and we should like to get some of the points clear. We should like to know what is meant by "decentralisation." For instance, is it intended to break down the carriage and wagon department, arid all those separate departments in relation to which we are talking about functional control from the centre?
§ VISCOUNT SWINTON
That particular question shows how wise I was to say that we will not put all the details of decentralisation into a blue print. But we are certainly going to carry it out exactly on the lines on which it is not being carried out to-day in the nationalised organisation.
The test of whether we have failed or succeeded not, as the noble Lord said, whether at last the Commission have made a profit—by which he means it has made a million or two, although I do not know what has gone into overheads, or what has been allowed for interest on stock. Of course in the long run, after two or three years, having eliminated all competition and having steadily put up 1122 rates, anybody could make a profit. After all, on that basis anybody could succeed in making what is called a profit. The real test of failure or success is: has the trader got the service that he needs? There are examples galore to show that he has not, and everyone has them in mind. There have been interminable delays.
In an earlier debate in this House, example after example was given of goods which hitherto had been taken in twenty-four hours having to wait for a fortnight. I will not go through them. I myself on that occasion cited a case where goods had gone from Darlington up to Newcastle, from Newcastle down to Hull, and then from Hull back to Beverley—circulating like minutes in a Department, round everywhere. It is almost like saying "The day we went to Birmingham, by way of Beachy Head." There was the example of consignments which were not collected in time and so missed the boat—a great help to export! We had endless examples of market gardeners who were not able to get their goods to market in time. Apparently it did not matter that they got there in the afternoon! The whole essence of the matter was that they should get to the, market in the early morning. Over and over again, traders have been unable to get the quick individual service that they need. One might almost think that trade was made for transport, and not: transport for trade. Of course, the final and absolute proof is this enormous increase in the number of "C" licences. The noble Lord said that the whole of this increase had taken place in the licensing of tiny runabout vans. That is not so at all; it is about half and half.
§ VISCOUNT SWINTON
I have made inquiries, and I am told that the proportionate increase in connection with runabout vans is not, as you would expect, overwhelming. Nearly half are in relation to larger vans. Supposing that the proportion is less than half, supposing that it is only 200,000 or 150,000 of the heavier lorries, it remains a fact that these lorries have been bought by trailers who would net have bought lorries if they could have obtained 1123 satisfactory service from the road haulage organisation. Of course, they would not.
§ VISCOUNT SWINTON
I will tell the noble Lord exactly why not. If I got good service from a road haulier I should not go to the expense nowadays of buying a lorry and employing a driver at heavy expense and doing one-way traffic—for I can carry the goods only to their destination; I cannot bring anything back. If the noble Lord thinks that anybody in his senses would do that kind of thing if he could get his goods properly carried, he underrates the commonsense of most people who are in business.
Then let me say one word about the levy. I was asked whether every lorry belonging to the railways was to be sold. As I understand it, the answer to that is, No; those lorries which are essential feeders of the railway services will be retained by the railways.
§ LORD LUCAS OF CHILWORTH
The noble Viscount says that the lorries which are essential feeders to the railways will be retained. Exactly what does that mean? I quite understand the position with regard to the parcel delivery vans, of which I believe the Railway Executive owns 39,000; but the Road Haulage Executive vehicles, I submit, are all going to be sold, and they are something more than the small delivery vans.
§ VISCOUNT SWINTON
I am informed that if they are ordinary common carriers, the idea is to sell them. But I understand that there are certain vehicles which are really part and parcel, so, to speak, of the railways. They are not just common road haulage vehicles, but they are much more purely ancillary vehicles bringing things to a railway centre. Let me leave it there. If there are such, then our idea is that the railways should retain them. If they partake of the nature of what I call general road haulage they will be sold in their appropriate unit.
Let me come to this question of the levy. It has been said that the levy is all wrong because it represents a subsidy to the railways. It is easy to play with words: I want to look at the reality of this. I do not mind whether, for the sake 1124 of argument, you call something the railways receive a subsidy or a receipt. It is, in fact, a receipt. So much is paid over. But to put this levy on road transport is no more giving a subsidy to the railways than if you give them traffic receipts—as you do at this moment. You give them traffic receipts, either by putting very high charges on traffics which cannot go in any other way—as, for instance, coal, iron ore and steel—or else by forcing traffic which would normally go by road on to the railways, by refusing lorries the right to run or carry it. In both these ways, which are being practised to-day, railways get receipts. The second way—forcing traffic on to the railways—works only partially, beause, as a matter of fact, what happens is that the trader buys a lorry and runs it under a "C" licence.
Both these measures—raising rates for heavy goods that cannot escape the railways, and the suppression of competition by the road, and diversion of traffic to the railways—are just as much contributions or subsidies to the railways as this levy. But they are much worse, because they are concealed subsidies and they are bad in form. And, as I say, both are being practised at the present time. In the first place, they are bad for all industry because the high rates on heavy basic traffic follow right through and increase the cost of all industry and manufactures. Secondly, they are bad for industry because they prevent it from getting the right kind of road haulage, in that they deny industry the quick, varied and economical service which it needs. We approach the problem by giving industry the service that it needs, but at the same time saying "Let the road make a contribution (it is a very small one) in respect of the traffic transferred," which is a much sounder and more economical method of proceeding than the one to which I have referred. It is not a "feather bed" or a levy bed—or whatever it has been called—on which the railways can lie, because it is intended to operate, and will operate, only when they have practised every possible economy and every possible efficiency in management.
I was asked another thing about sales and on that I have to say this. Very likely a reserve may be put on. I do not think that anyone who has ever done business with my noble friend Lord 1125 Leathers would deny this. I have met a good many people in my life who have bought something from Lord Leathers in the course of their business careers, but I have never yet come across anyone who said that he had got it unduly cheaply. I think that if anyone can be trusted to see that a business deal goes through in a business-like way, and can be trusted to get full value in a fair and business-like deal, it is my noble friend. I would add this: discretion is certainly needed. I have not had as much experience as my noble friend of selling things, but I have done a bit of salesmanship in my time, and whether I was buying or selling, I certainly should be extremely sorry to say in advance how I was going to do it. Sometimes it is wise to put on a reserve and sometimes it is not. As one noble Lord has, I believe, suggested, one has to be sure that the potential purchasers are not only good for the cash, but are also good for running the business which is going to be sold to them. It is certainly the intention to make sure of those factors, and I think it can be carried out.
§ LORD LUCAS OF CHILWORTH
May I take it that the reply to the insistent question we have asked—are these things going to be sold with or without reserve?—is that the noble Viscount does not know?
§ VISCOUNT SWINTON
I should prefer that the answer was recorded in the language which I have used. In some cases, no doubt the goods will be sold with a reserve if it is thought that better business will be done with a reserve. But we certainly should not tie ourselves to selling with a reserve. No one but a fool would give any other answer—I do not add "or a nationalised industry."
Now let me say a word or two about the 25-mile limit. I promised two noble Lords to do so. We were told that we were breaking our pledge.
§ LORD OGMORE
The noble Lord, Lord Leathers, said that. He went to some length to explain why a promise made by his Party could not be carried out. Let us have the fact acknowledged that it was a pledge.
§ VISCOUNT SWINTON
The noble Lord is very fond of making other people's speeches as well as his own. Perhaps he will be good enough to let me 1126 make my own speech. We propose to act in accordance both with our Election pledges and with sound practice. Those two things often coincide. As far back as 1950 we said in our Election Manifesto:The limitation of distance on private road hauliers will be progressively eliminated.During the last Election this was confirmed, both in our Manifesto and in a statement made by my right honourable friend the Secretary of State, Sir David Maxwell Fyfe, about the 25-mile limit in which he said:In the transitional period of turning road transport back to private enterprise, it may be necessary to act in stages.That is exactly what we are doing. The noble Lord is doing his best to make trouble, but he is not likely to succeed in making trouble between the road hauliers and us. They know that we are not breaking pledges; they know that this is sound business. Any short haulier will be entitled to bid for one of the Government units when they are on offer, and so come into the long-haulage business at the start. Of course, when the sales have been largely completed, then the 25-mile limit will be taken off all hauliers in respect of vehicles which they own at the present time.
The noble Lord will not like this quite so much but there is this other point. Road hauliers in the past have rightly complained—for they have had great cause for complaint—of the way in which their permits have been issued. These permits to exceed the 25-mile limit which have been given them in the past have, been granted by the Transport Commission or the Transport Executive, who are their competitors and only too keen to have them off the road if possible. We have always said that it is wrong that a man should be a judge in his own cause, and so this arrangement is going to be changed. In the future, these permits will be granted by an independent authority.
Let me add one word about the licensing of road haulage. I was asked whether we want to go back to complete chaos. Certainly not. A licensing system will be necessary in the, national interest, but the basis on which licences will be granted will be quite different. In the past, licensing authorities had to consider the interests of railways as railways, as 1127 well as the interests of traders, and it was the common practice of the Transport Commission to oppose all applications as a matter of course, both to protect themselves as railways and to protect their own vehicles. The Transport Commission could put any lorry they liked on the road without reference to the licensing authority. We always thought that was a most extraordinary position. That was both unjust and unsound. In future it is our intention that the trader, who is the best judge, shall be entitled to send his goods by road or rail, whichever can give him the most convenient service. This is not only in the trader's interest, but in the national interest as well.
But we cannot have an unlimited number of lorries on the road. It would not be in the national interest that the remunerative traffic should be overmanned and the less remunerative undermanned, though in the days of private enterprise I never heard of a case where a trader could not get his load carried by some road haulier. I believe this argument which was raised is entirely theoretical and under the old system never arose in practice. The test which the licensing authority will apply will be: are further lorries required to meet the reasonable demands of traffic offering? So long as the Transport Commission own lorries, they will be subject to the jurisdiction of the licensing authority.
My noble friend Lord Runciman raised the question of coastal shipping. I think that was dealt with by the Secretary of State in his opening speech. I do not think there is much competition between coastwise shipping and road haulage. I am told that 80 per cent. of the traffic which the noble Viscount's clients carry is coal, and so far as there is competition I should say it was largely between coastwise shipping and railways and not with lorries. I do not want to see all competition eliminated, and I should be surprised if the noble Viscount, as a good free trader, does.
§ VISCOUNT RUNCIMAN OF DOXFORD
I do not want to see competition eliminated any more than the noble Viscount does, and I thought I said so.
§ VISCOUNT SWINTON
I am sure the noble Viscount did, and therefore we are all at one. There is no intention to abolish the Coastal Shipping Advisory Committee which at present exists. I believe that there are things called conferences which sometimes meet and sometimes make arrangements, and I hope the happy co-operation and competitive spirit which exists between these branches will continue.
Several noble Lords have referred to the importance of giving greater latitude to the railways in their charges. I am sure that is right. I am much more interested in latitude being given to the railways to enable them to put their charges down rather than put their charges up. I am sure there is a great deal they can do if they are given the chance. As I remember it they were hedged round by a frightful frieze, a zariba, of restrictions. If you could collect the traffic which would be good business for you as a railway company, you could not take that traffic at a rate which it would pay you to offer and which would be agreeable to the man for whom you proposed to carry it unless you offered the same rate to everybody from John o'Groats to Land's End. I remember all the meticulous regulations about undue preference and special rates and all the rest of it, and I think they still apply to-day. You have to go to the Transport Commission to justify the rate, taking with you counsel and all our witnesses—that costs something—and everybody who thinks he may conceivably be interested, every type of trader, every trade association, chamber of commerce—the whole lot of them—can come and oppose. You may get through in the end, but it is more probable that the railway company will not do it, because it would not be worthwhile to go through all that rigmarole and expense to quote a special rate. But if they could quote a rate and then go to the tribunal afterwards to justify it, in nine cases out of ten a special rate which would be both good for the trader and good business for the railway company would go through as a matter of course. It would only mean marking "2 and 1" on some counsel's brief, because nobody would oppose and nobody would have to be heard.
We have been told that we do not know our business, that we have no 1129 policy and have not thought out the details. It is exactly because they have this kind of practical knowledge that Ministers like my noble friend, with all his knowledge, can supply practical solutions to these questions. We have had the threat repeated to-day that any reforms which are made will be disowned if opportunity is offered.
§ LORD LUCAS OF CHILWORTH
May I have his name? The noble Viscount has had to be corrected by two or three noble Lords for gross exaggerations and distortions of what they were saying. He has been corrected by noble Lords of his own Party. The noble Viscount said that this threat has been repeated to-day. I want to know by whom. If he wants to be a fair controversialist, let him at least be accurate.
§ VISCOUNT SWINTON
I do not require any lessons from the noble Lord in controversy or fairness. I stand on such reputation on these matters as I may enjoy in this House. I do not think I have said anything unfair. I am pretty certain that he will be able to find tomorrow in the text of the speeches a virtual refutation of that. I ask the noble Lord this, and this is neither unfair nor improperly controversial: does the noble Lord accept, or does he not accept and stand by Mr. Morrison's statement?
§ VISCOUNT SWINTON
I think that really shows the type and temper of that intervention. Those who presumably are the overlords in his Party in another place have made this assertion and I have no doubt that the noble Lord will come to heel. The Party opposite will not find it easy; nor, if these reforms succeed, as I believe they will, will they find it popular. I am not unduly disturbed by these threats; I do not think I have ever been. They are the staple diet with which we are regaled now at every Sitting. They 1130 are characteristic of the irresponsible attitude of the Opposition. When they were a Government, they brought this country to the brink of disaster. As an Opposition, they seek to obstruct every measure necessary to our recovery and to our salvation. We shall be in no way deterred from doing our duty, and when the time comes—and it will be quite a long way off—we shall be quite content to be judged by results.
§ 8.20 p.m.
§ LORD LUCAS OF CHILWORTH
My Lords, when I made my opening speech in this debate I said that I did not intend to divide your Lordships' House, and, of course, I do not. Could I have the attention of the Secretary of State for one moment, because I am going to address a few words to him? I do not intend to divide the House. That leaves little for me to say, and I shall detain your Lordships for only a moment or two. I am sorry that the Secretary of State could not give me or the House a number of answers that I required to questions. I quite understand why. He had to prepare a very important statement before I spoke. I have only one remark to make on that: I think that those who prepared that statement for him rather anticipated what I would say and it is rather unfortunate that they should put words in my mouth that I did not say. However, I make no complaint about that. I am afraid I am very dissatisfied with the noble Lord's statement, but that does not count for very much. I fear the country will be still more dissatisfied, because the noble Lord, Lord Leathers, said that his object was to clear up, not only in the minds of many noble Lords but also in the minds of the Press and the public of this country, a number of misconceptions. Believe me, the noble Lord did not do that. We understood correctly what he said, and there was not one word which the noble Lord uttered which really altered anything that has been said by any of the responsible Press of this country, or by any responsible informed opinion.
There is another matter that slightly disappointed me. I think I can, with propriety, disclose that in the spirit of friendship which I think the noble Lord and I enjoy we had one or two conversations before this debate. I told him, quite frankly, that I did not intend to 1131 divide the House, because I thought that some of the arguments which I should put up to him were sound and deserved the respectful consideration of the Government. I hoped that he would find it possible in his speech to say that they would consider them, but he did not do so. I believe that there are a great many arguments that require the careful attention of the noble Lord. I put to your Lordships in my opening speech what I frankly thought was in the minds of the British people. I do not depart from that in one instance.
As regard the noble Viscount, Lord Swinton, I am glad that he made the speech that he did, because the longer he went on the more I was convinced that I was right; and the longer he went on the more I became certain that the country will think that I was right. The noble Viscount has just made the same speech that I listened to in 1947; he made the same speech that I listened to on the debate initiated by the noble Lord, Lord Teynham. The noble Viscount did not really answer the burden of our case—but then he seldom does. There is only one thing that I want to say about the noble Viscount's speech. I was rather amused at his justification for the levy, or his attempt to explain that the levy is not a subsidy to the railways—I thought that was rather good. He will never convince me or the public, because it is common sense. It does not matter whether the money is found via the Treasury, from the pockets of the taxpayer, or via some accounting method in the Ministry of Transport from the pockets of the consumer, there is no difference whatever—it is a subsidy pure and simple. Whatever the levy imposed on the road transport of this country, it will come ultimately out of the pockets of the consumer, through increased charges on the goods bought.
1132 That is all I have to say. I hope that perhaps we may, between now and the time when the Bill is introduced, resume the discussions which have been so beneficial to me, and which I hope have not been unhelpful to the noble Lord. With that, I ask leave to withdraw my Motion.
§ Motion for Papers, by leave, withdrawn.