IRON AND STEEL BILL

HL Deb 05 May 1953 vol 182 cc216-23

2.58 p.m.

Order of the Day for the Third Reading read.

LORD MANCROFT

My Lords, on behalf of my noble friend the Leader of the House, I beg to move that this Bill be now read a third time. Your Lordships will remember that on Second Reading no fewer than seventeen Members of your Lordships' House gave us the benefit of their views; on the Committee Stage we had fifty-seven Amendments on the Order Paper, and on the Report Stage of the Bill there were fifteen Amendments on the Order Paper. So after five full and, I think, friendly days of discussion upon this measure, it is probably fair to say that the Bill has been robbed of any element of surprise.

There is, therefore, very little left to say, save to put forward this one point. In the opinion of Her Majesty's Government, when this Bill arrived in your Lordships' House it was a good Bill, and when it leaves your Lordships' House it will be an even better one. Her Majesty's Government would like to thank those noble Lords who participated, and particularly the noble Lord, Lord Wilmot, and his colleagues on the Benches opposite, for the part they played in improving this Bill: their attitude throughout was, if I may say so, tolerant, well-informed, helpful and constructive. I do not pretend for one moment that this Bill will satisfy all those who believe in the complete nationalisation of all the means of distribution, production and exchange. It is not intended to. I do not pretend for one moment that it will please all those who believe in complete and unfettered private enterprise. It is not intended to. The Bill seeks to derive what is best from both systems. The Bill is a combination, we think, of the best and most workable elements of both systems, and the test throughout that we have made is this—not whether any political dogma can be established or whether any political dogma can be pulled down, but whether the measure itself is in the best interests of the iron and steel industry and of the country. That has been the overriding consideration throughout this Bill.

I trust that it is not too much to hope that the good will which has been shown towards this Bill in its progress through another place and through your Lordships' House may now attend upon it when it passes into law and attaches to this great industry. We hope that it will be accepted, by the industry, by all who earn their living in it, and by the country, with the same good will and tolerance that it has been accepted by Parliament. We feel that the Bill provides a firm and sound foundation for the industry, that it will help this happy industry to go forward to further happiness and prosperity. Finally, we believe that this Bill provides, Once and for all, a chance to take politics out of the iron and steel industry and to take the iron and steel industry out of politics. My Lords, I beg to move that the Bill be now read a third time.

Moved, That the Bill be now read 3^a.—(Lord Mancroft.)

3.3 p.m.

LORD WILMOT OF SELMESTON

My Lords, I should like to thank the noble Lord, Lord Mancroft, for his characteristically graceful tribute and, indeed, for his courtesy and understanding throughout the passage of this Bill, and for that of his noble leader, Lord Salisbury. I can only say again that, although we on this side of the House have done what we believe to be our duty, and have tried to improve this Bill as best we may, we very much regret the Bill. We regret it mainly because we feel that the Government have unnecessarily gone out of their way again to disturb this great industry and to make it inevitable that, with another change of Government, we shall see another Iron and Steel Bill. If there were, as has been said, imperfections in the Bill which is still on the Statute Book, then time would have revealed them and the Bill could have been improved, as time went on, in the knowledge of events and experience. But the Government have chosen the other course, and the responsibility must be upon them. However, I can only say, in seeing the last of this Bill for the time being, that we hope, despite our fears and convictions in this matter, that less harm may be done to this great industry than we fear, and that, despite the action which the Government have taken, the industry will prosper and find a way, not withstanding these handicaps, to discharge its great responsibilities to the nation, upon which so much depends.

3.6 p.m.

LORD HAWKE

My Lords, this Bill came to us a good one; I think it is leaving us a better one. It satisfies me that it has solved the problem of what one may describe as the battledore and shuttlecock of the industry. Like all thinking people, I am deeply disturbed by the idea of great industries being tossed from side to side over the net like a shuttlecock. At the same time, I am utterly unprepared to accept the doctrine that one Party in the State may gradually, little by little, spread State ownership, while another Party is morally bound not to reverse the position. To my mind—and I feel very deeply on this—such a wide expansion of State owner ship would in the long run bring us to the Communist State, de facto if not de jure.

I believe that a large number of people in the Labour Party would agree with me in those sentiments, but they are very much taken up with the short-term disadvantages of private ownership, as they see them, and they tend to be distracted from this very much longer-term danger. In this Bill, I think moderate Labour can see that they are safeguarded against many of what they regard as the drawbacks of private ownership, without having to risk this long-term danger. If that is the case, I do not see why the problem of the "shuttlecocking" of the iron and steel industry should not be solved for all time. As I say, the Bill provides them with many safeguards. For instance, there is one safeguard which I particularly welcomed. I refer to the provision that there shall be consultation three months before the closing down of any works. And even if the closing down becomes almost inevitable, there is power in the Minister's hands to avert that closing by putting up the money to run the works himself, if he should consider that to be the lesser of two evils. The Bill is full of safeguards of that particular nature.

One other criticism of private ownership is that in the future those concerned will not be able to raise the capital necessary to keep great industries modernised and up to date. I am not speaking now of the initial effort, which everyone must agree is an onerous and heavy task. But, provided that we realise that for an industry to be healthy and modern it must be nourished, this industry should be able in the future to raise its own money. In the case of renewals, are we going to suffer for ever a position in which the Inland Revenue compute as profits and take away money which really should be destined to replace machinery? I do not think that that situation is going to last very much longer. As for new capital expenditure, I believe that by a combination of loan capital and equity capital, raised from the public and from the institutions, and from ploughed-back profits, money will be there in future. But it will be there, we must remember, only if we allow the industry to be properly nourished.

Of course, there are other safeguards in the Bill, but I do not propose to detail all of them. Before closing, however, I should like to say a word of thanks to the spokesmen of the Labour Party and the Liberal Party who said kind words about an Amendment of mine on the Report stage. Only strict adherence to the rules of order prevented my rising a second time to thank them then. Finally, I should like to say how much we appreciate the way the Bill has been handled by the noble Marquess the Leader of the House and his able lieutenant, Lord Mancroft. I feel that the latter, at all events, has emerged from his first major encounter with very great credit.

3.10 p.m.

LORD WINSTER

My Lords, we have had our battle over this Bill, and, thanks very largely to the noble Marquess the Leader of the House and Lord Mancroft, it has been a very good-tempered and good-humoured battle, fought, in fact, with many of the courtesies which used to distinguish battles in the days of armour and of chivalry. Now it is over and the Bill is to become an Act, I entirely agree with the noble Lord, Lord Mancroft, that all that remains for us to do at this juncture is to wish good fortune to the iron and steel industry. One must wish an industry of such fundamental, vital importance to the fortunes of this country great prosperity under this dispensation. In connection with both this Bill and the Transport Bill I have expressed on more than one occasion my concern for the prospects of any industry being nationalised, denationalised and renationalised. Without any regard for politics, I do not believe that under such a process as that any industry can possibly prosper but must eventually come to ruin. Therefore, I have always expressed the hope that in the fullness of time we may work out some compromise in these matters. In both the Transport Bill and the Iron and Steel Bill I have, if I may say so, detected traces of a Government wish to meet that point. Here and there I have distinctly seen a certain wish to affect a reconciliation between free enterprise and nationalisation, and it was really in regard to that that I rose to say a few words.

During the proceedings on Committee stage of the Iron and Steel Bill I was much struck by a proposal put forward by the noble and learned Earl, Lord Jowitt, about the possibility of Government holdings in these companies. There was an interesting discussion on that point, although time did not permit of its being gone into as thoroughly as perhaps it deserved to be. Looking into the future, I hope that that point may be borne in mind, because I feel strongly that it opens out yet another way of effecting a compromise between rival views as to how our industries should be carried on, a compromise which would be of great benefit to the industries themselves. I rise to express strongly the hope that the point put forward by the noble Earl may be carefully considered when other matters of this sort come to be discussed.

3.13 p.m.

EARL JOWITT

My Lords, I think that, as Leader of the Opposition, I should endorse what has been said by the last speaker, Lord Winster, and by the noble Lord, Lord Hawke, about the debt which, not for the first time, the House owes to its Leader and to the noble Lord, Lord Mancroft, because, although it is the fact that we differ fundamentally about this Bill, we did agree to differ. Tempers were not ruffled, and that in itself, to my mind, is a great advantage, which we enjoyed largely owing to the noble Marquess, the noble Lord, Lord Mancroft, and also, in large measure, to my noble friends, Lord Wilmot of Selmeston and Lord Silkin, who spoke for this side of the House. And may it always be so. But do not let it be thought that because our discussions are amicable and friendly that is any indication whatever that we do not feel deeply and sincerely what we are saying.

If you take the view of the prospects of this country that I do, your Lordships will realise how vitally important this matter is. I am not being pessimistic; I think I am being only a realist when I say that this country is faced with a terrific problem. I believe that unless we have an iron and steel industry about as efficient as that industry can be made, our difficulties are going to be much greater. Like coal, iron and steel is a fundamental, a basic, industry, upon which many other industries depend. It must not be looked upon as an industry by itself: it is the underlying base of many other industries. If we are to come satisfactorily out of the trouble which is awaiting us ahead, it behoves us, apart altogether from politics, to make this industry as efficient as human ingenuity can make it. I regard that as vital to our salvation.

Having said that, let me just say this: frankly, my anxiety is that there are too many small concerns. I am not fool enough to pose as an expert—there are many experts in your Lordships' House—but I have given some study to this matter. I believe we ought to have a smaller number of larger concerns. I base my remarks on the recent Report, which is the source of my information. I believe there is an optimum output per works which, speaking from memory, should be round about 1,000,000 tons, whereas the average output per works is round about 300,000tons. That seems to show that if we had fewer works and larger outputs, we should be in a better position. I believe that that is a serious problem which is going to confront the statesmen of this industry and of this country. I am not wise enough to know what the answer is, but I know that if you have a large number of rival concerns, each under separate ownership, it is going to prove impossible to bring about those amalgamations or, what is rather more drastic than amalgamations, those shuttings down of works here and there and the enlarging and blossoming out of others, which is the kind of process we may have to face up to.

Lord Keynes once said that the ownership of shares did not matter very much; what mattered was the way in which a concern was managed. That is true with regard to a great number of industries. It was with regard to those other industries and not to iron and steel that I referred to the possibility of joint share holding, about which the noble Lord, Lord Winster, was good enough to make a complimentary reference. I have always felt that in this particular industry—that is, iron and steel—we could not get out of our difficulty on those lines, for we shall have to look at the problem as a whole and reorganise this industry from top to bottom. I feel that to be the trouble. If this industry is to be reorganised, there is a vast amount to be said for the State ownership of shares until the time when the industry has been reorganised. I am very sorry that noble Lords have broken up that idea before the organisation has been started, because, in the process of time and by the force of circumstances, that is the idea you will be forced to adopt. After all, we have seen this occur many times in private enterprise. The Morris and Austin undertakings came together. And I believe that along the lines on which business is conducted to-day, amalgamation will become necessary in the iron and steel industry on an even larger scale. I believe that the force of circumstances will drive us to it.

I confess that I thought this was a bad Bill when it came to this House. I think that, with the alterations your Lordships have made in this House, it is a rather less bad Bill than it was; but I still think it is a bad Bill. The noble Lord, Lord Hawke, appealed to what he called "moderate Labour." He seemed to think that this Bill in its present condition would satisfy moderate Labour. I suppose I am a fair representative of that school of thought. I am bound to tell the noble Lord that this Bill does not in the least satisfy me, or those of my school of thought. Though I do not issue any threats, or anything of that sort, I am bound to say that I concur with what the noble Lord, Lord Wilmot, said in his speech just now. It seems to us inevitable that if, in the whirligig of time, a Labour Government is once more restored to power, there will have to be another Bill dealing with the iron and steel industry. I am certainly not going to attempt to forecast the provisions of that Bill now, but I hope that if and when the time does come to introduce such a Bill, statesmen will look at it coolly and deliberately, in the light of the circumstances then existing, to see what needs to be done.

I felt I was bound to say that, because that is the reaction which I have about this Bill. For the rest, I entirely agree that we should keep steel out of politics, and politics out of steel, if that will prevent politicians from interfering with the running of the industry. No sensible Socialist wants to do that at all. We want industries to be run by the people who understand them, and not to have them interfered with at all. I sincerely hope that good luck will attend the iron and steel industry. I hope that all the difficulties which I foresee about getting the necessary capital to make their works really up to date—and in my view they have got to be the best in the world—will not materialise. Along with the noble Lord, Lord Hawke, I hope that the tax-gatherers will not prevent them from getting to get her the necessary capital to make their works up to date. However, I must say that I view the future of this great industry, on which so much depends, with real concern and anxiety.

On Question, Bill read 3^a, with the Amendments, and passed, and returned to the Commons.