Lords Sitting of 1 May 1956

Preamble
The House met at half past two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers
  BOURNEMOUTH—SWANAGE MOTOR ROAD AND FERRY BILL
  Read 2a, and committed.

NEWSPAPER REPORTS OF MOTOR CAR CASE
2.35 p.m.
LORD MERTHYR: My Lords, I beg to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her 'Majesty's Government, whether their attention has been drawn to reports in the Sunday Dispatch of March 11, 1956, and in the Sunday Express of March 18, 1956, of the case of the Chief Constable of Stockport v. Solomon Michael, recently decided at Stockport Magistrates' Court; and whether they would agree that these reports are substantially inaccurate and, unless contradicted, are likely bring the administration of justice into disrepute.]
THE LORD CHANCELLOR (VISCOUNT KILMUIR): My Lords, I have seen the newspaper reports to which the noble Lord refers, and I have also obtained
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particulars of the case from the magistrates concerned. The newspaper reports are not entirely correct, nor do they give the full facts 'of the case. In consequence of this, the magistrates who tried the case have, to my knowledge, been subjected to much undeserved ridicule and even abuse from persons who have read the reports. It would appear from the newspaper reports that the Stockport magistrates disqualified the defendant for driving for twelve months because he used his car to carry one bottle of orange juice which was required for his business as a café proprietor when his vehicle was licensed only for private purposes.
The facts are as follows. The defendant used his car to fetch from a wholesaler a half gallon jar of orange juice which he required for his café. The third party insurance policy for the defendant's car expressly stated that it did not cover the use of the car for the carriage of goods in connection with any trade or business. The defendant was therefore charged with using a motor vehicle when not insured. against third party risks, contrary to Section 35 of the Road Traffic Act, 1930. He was not charged with -using the car without a licence for the carriage of goods, as was stated by the newspapers. The importance of this distinction is that any person convicted under Section 35 of the 1930 Act is, by virtue of the conviction disqualified for driving for not less than one year. This disqualification follows automatically under the Act of Parliament without any order or other positive action on the part of the magistrates. The court has no option whatever,

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unless there are special reasons why the offender should not be disqualified.
The defendant in this case admitted that the orange juice had been obtained for use in his café and that it was being taken there. He also admitted that in these circumstances he was not properly insured, and he pleaded guilty to the charge. This rendered him liable to a maximum fine of £50 or three months' imprisonment. In fact, the magistrates imposed a fine of 20s. The defendant also stated that he had no special reasons to put forward to show why he should not be disqualified for driving and, therefore, the disqualification for a period of one year followed automatically. I would add that the defendant asked the court to exercise the power conferred on them by Section 6 of the Act of 1930 and limit the disqualification to driving a vehicle of the same class as the vehicle in relation to which the offence was committed, namely, a motor car, so that he could continue to ride his motor cycle to his work. The court did so limit the disqualification, and the newspaper reports are inaccurate in suggesting that the defendant was totally disqualified.
These are the undisputed facts of the case. Nevertheless, I do not think there can be any doubt that persons reading the reports in question would be likely to conclude that the magistrates acted unjustly in imposing an excessive penalty for a very minor offence. The fact is that they could hardly have treated the defendant more leniently than they did, unless they had disregarded the provisions of the Act of Parliament under which the defendant was charged. I hope that what I have said will make it clear that any criticism of the Stockport magistrates for their handling of this case is quite unjustified. Magistrates are required to administer the law as they find it, and that is precisely what the Stockport magistrates did on this occasion.
I feel sure that your Lordships will agree with the noble Lord who has asked this question that inaccurate reports of proceedings in magistrates' courts are likely to bring the administration of justice into disrepute. Magistrates have a heavy responsibility, but they undoubtedly discharge their duties day after day throughout the country with
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marked efficiency and it is only on the most rare occasions that any genuine criticism can be levelled against them.

LOCAL GOVERNMENT (STREET WORKS) (SCOTLAND) BILL
Brought from the Commons; read 1a, and to be printed.
OCCASIONAL LICENCES AND YOUNG PERSONS BILL
Brought from the Commons; read 1a, and to be printed.

PARLIAMENTARY CONSTITUENCIES (BLACKPOOL AND NORTH FYLDE) ORDER, 1956
PARLIAMENTARY CONSTITUENCIES (BRADFORD AND SHIPLEY) ORDER, 1956
PARLIAMENTARY CONSTITUENCIES (COLCHESTER, MALDON AND SAFFRON WALDEN) ORDER, 1956
PARLIAMENTARY CONSTITUENCIES (ECCLES AND FARNWORTH) ORDER, 1956
PARLIAMENTARY CONSTITUENCIES (KINGSTON UPON HULL AND BRIDLINGTON) ORDER, 1956
PARLIAMENTARY CONSTITUENCIES (NOTTINGHAM) ORDER, 1956
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR THE HOME DEPARTMENT (LORD MANCROFT): My Lords, these Draft Orders give effect without modification to the recommendations made by the Boundary Commission for England in their Report submitted to my right honourable friend the Secretary of State on January 26, 1956. The Orders will not affect any Parliamentary election until the next General Election after they come into force. The Orders are not wholly without controversy, but they make only very minor adjustments of constituency boundaries to conform with recent alterations of local government or ward boundaries. With the permission of the House, I will

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follow the usual procedure in these cases and move them formally. I beg to move.
Moved, That the Draft Orders reported from the Special Orders Committee on Wednesday last, be approved.—(Lord Mancroft.)
On Question, Motion agreed to.

CALF SUBSIDIES (ENGLAND AND WALES AND NORTHERN IRELAND) SCHEME, 1956
2.42 p.m.
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (EARL ST. ALDWYN): My Lords, as your Lordships will know, the Agriculture (Calf Subsidies) Act, 1952, enables schemes to be made for the payment of subsidies on calves. The first scheme of this kind applied to calves born up to October 29, 1955, and the scheme now before your Lordships provides for the continuance of subsidies on calves born in the period October 30, 1955, to October 29, 1958: that is for another three years.
The rate of subsidy under the earlier scheme was £5 a head, but that scheme was altered in June, 1955, to raise the rate to £7 10s. for calves born on or after April 1, 1955. The rate of subsidy under the present scheme continues to be £7 10s. for heifer calves. For steer calves the rate is £7 10s. for those born before April 1, 1956. and £8 10s. for those born on or after that date. Your Lordships will remember that the higher rate for steer calves was part of this year's Annual Review award as announced in the White Paper, which we published in March. I do not think there can be any doubt that this subsidy is a valuable means of encouraging the rearing of store cattle to produce beef, and we are still in need of more home-produced beef. I therefore commend the Scheme to your Lordships and beg to move that it be approved.
Moved, That the Draft Calf Subsidies (England and Wales and Northern Ireland) Scheme, 1956, reported from the Special Orders Committee on Wednesday last, be approved.—(Earl St. Aldwyn.)
On Question, Motion agreed to.

CALF SUBSIDIES (SCOTLAND) SCHEME, 1956
EARL ST. ALDWYN: My Lords, on behalf of my noble friend, Lord Strathclyde, I beg to move that this Order, also, be approved. It is similar to the one which I have just described and applies to Scotland.
Moved, That the Draft Calf Subsidies (Scotland) Scheme, 1956, reported from the Special Orders Committee on Wednesday last, be approved.—(Earl St. Aldwyn.)
On Question, Motion agreed to.

SUNDAY ENTERTAINMENTS ACT, 1932
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE Ha THE HOME DEPARTMENT (LORD MANCROET): My Lords, the three Orders under the Sunday Entertainments Act, 1932, which stand in my name on the Order Paper are in the usual form and of the usual content. There is nothing in them to which I need draw your Lordships' attention. Accordingly, I beg to move the first Motion standing in my name.
Moved, That the Order made by the Secretary of State for the Home Department, for extending section one of the Sunday Entertainments Act, 1932, to the Borough of Louth, be approved.—(Lord Mancroft.)
On Question, Motion agreed to.
LORD MANCROFT: My Lords, I beg to move.
Moved, That the Order made by the Secretary of State for the Home Department, for extending section one of the Sunday Entertainments Act, 1932, to the Borough of Stalybridge, be approved.—(Lord Mancroft.)
On Question, Motion agreed to.
LORD MANCROFT: My Lords, I beg to move.
Moved, That the Order made by the Secretary of State for the Home Department, for extending section one of the Sunday Entertainments Act, 1932, to the Rural District of Tendring, be approved.—(Lord Mancroft.)
On Question, Motion agreed to.

TRANSPORT (DISPOSAL OF ROAD HAULAGE PROPERTY) BILL
2.49 p.m.
Order of the Day for the Second Reading read.
THE CHANCELLOR OF THE DUCHY OF LANCASTER (THE EARL OF SELKIRK): My Lords, in moving the Second Reading of this Bill I think I can say that noble Lords in almost all parts of the House very much hope that this will prove to be the end of a chapter in the history of transport in this country; it is not yet the end of the book of transport, for, of course, that will go on as long as man survives. I would describe this chapter as one in which too much reliance has been placed on the resolution of transport problems by political measures. I believe that to-day people have lost a good deal of confidence in that kind of panacea and realise that the resolution of the transport problem is essentially a question of administration, good labour relations, organisation and the expenditure of very substantial sums of capital. For that reason I, and I believe most people, hope that in the future political solution will not be so warmly welcomed.
May I recall to the House the main results of the 1953 Act? They were first, to break the monopoly of long-distance road haulage, at that time held by the Transport Commission; and secondly, to give the railways much wider freedom to compete with road haulage in the fixing and organising of their charges. As the House knows, there is already in operation a passenger charges scheme. That scheme and a freight charges scheme have been under examination before the Transport Tribunal, which should complete its work before very long. The provisions of the 1953 Act in regard to the sale of lorries have worked quite well on the whole, except in regard to medium and large units. During a period of two and a half years, up to the spring of this year from the commencement of December, 1953, 19,200 lorries have been sold—an average of about 600 or 700 a month. Of the 26,100 vehicles which were for sale nearly 75 per cent. have been sold. We can therefore say that the main purposes of the 1953 Act have been fulfilled. Over 19,000 lorries are now in the hands of private competitors; the 25 miles limit
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has been abolished and all lorries, whether belonging to the Commission or not, are subject to licensing procedure at the present time. Moreover, it is fair to say that sales have been effected at good prices and both the Commission and the Disposals Board have conducted their business in this matter with the common sense and ability which one would have expected.
The only unexpected aspect of the sales was the lack of demand for medium and large units. The great majority of the sales were in small numbers; over half were sold in units of one to three. It is clear from this that the small man has had a full opportunity in this field if he felt inclined to take it. It was clear, however, that the sales of trunk services would have to be made in fairly large units if they were to operate efficiently. When it appeared that there was no strong demand for such large units Her Majesty's Government decided to draw the sales to a close. I am sure that that was the common-sense thing to do; and it was for that reason that this Bill was introduced at the end of last year. The effect of this Bill is to maintain the existing trunk services, and, further, to maintain a balance which will give a fair opportunity for competition for all in the field of road haulage, whether the Commission or anyone else. The Bill does four things. First, it increases the number of general haulage vehicles which can be retained by the Commission. Secondly, it allows the Commission to retain vehicles necessary for contract hire for contracts which they are able to renew and win in open competition. Thirdly, it abolishes the transport levy. Fourthly, it amends the procedure laid down in the 1953 Act for the sale of vehicles in companies.
May I deal in a little more detail with the clauses? In the proviso to Clause 1 it will be seen that the number of vehicles which may be retained by the Commission for general haulage is increased from 2,350 under the 1953 Act to 7,750. This means that under this heading, and including the first two categories of the 1953 Act, that is, those vehicles carrying abnormal and indivisible loads or vehicles constructed for special purposes, the Commission will be given rather over 9,000 vehicles. This figure was reached as a result of the examination by Sir Malcolm Trustram Eve of the size of the

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fleet necessary to enable the trunk network of the Commission to be maintained. He says, quite frankly, that it is not possible to reach a figure by mathematical calculation; but that this number, in his opinion, in the knowledge of the whole of the circumstances, would do the job. May I say a further word with regard to this figure. It is the number of vehicles which the Commission are entitled to retain, including, of course, the additional vehicles, which constitute about 582 in number. Although this is limited to special licences, the Corn-mission are free to obtain additional licences should they wish to do so under the procedure laid down in the 1953 Act. They will, of course, be in exactly the same position as anyone else who applies for a licence. No doubt, their applications will be opposed. Still, it is open to them to make applications should they feel that they are in a position to do so; and if they can make out a sufficiently good case no doubt they will get licences.
Clause 2 deals with the transfer and disposal of property through companies. Very shortly, the chief difference here is that instead of having to be sold in one parcel it can now be sold in parts, and the structure of the company may he divided between shares, debentures or any other form of security. In addition, the sale of the securities of a company may, with the consent of the Minister, be deferred if by so doing a better price is likely to be obtained. The Minister's consent may be revoked at any time, and the Commission will be once more under the obligation contained in the opening paragraph of Section 1 of the 1953 Act to sell the securities as soon as is reasonably practicable.
Clause 3 makes special provision for cases where the Commission are operating under a contract hire. Here they will be entitled to continue the contracts which they have, and compete for renewal when the contracts come up again. In so far as they are successful, they will be entitled to have their vehicles licensed. If not, then the vehicles will have to be disposed of. But, in any case, they must give up open A licences when these are transferred to companies. Clause 4 is not much more than machinery dealing with the licensing of trailers which are remaining with the Transport Commission. Clause 5 is really intended to pro-
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vide for the position should the Minister take over the duties of the Disposal Board and to give him additional powers. These enable the Minister to reorganise the structure of the company and to appoint a minority of directors, which will enable the companies to be more readily saleable. If and when the Board is abolished, the Minister may appoint some person to report on the disposal of vehicles, and the report will be laid before Parliament. Clause 6 makes stamp duty not payable on property made over to companies in the terms of Sections 4 and 5 of the Transport Act of 1953.
Clause 7 deals with the abolition of the transport levy. This will take place at the end of this year. Broadly, the transport levy will have brought in about £12· million by the end of 1956. We think that, taking into account the proportion of the goodwill standing in the books of the Commission, the expenses of the Commission and the Disposals Board, compensation to officers and servants, and allowing for the sale of meat vehicles and the parcels service at at least their book value—which we believe to be a conservative estimate—this figure will just about compensate the Commission for the capital loss involved in the sale. I think everyone will be glad to see the end of the transport levy at the end of this year. I can only express the hope that this reorganisation will prove to be of good service to the public and will restore fair competition in the transport services. I hope particularly that we are coming to an age when we can view these problems as they should be viewed, which is as administrative rather than political problems. I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read2a.—(The Earl of Selkirk.)
2.57 p.m.
LORD LUCAS OF CHILWORTH: My Lords, listening to the noble Earl commending this Bill to your Lordships' House in such dulcet tones and with such sweet reasonableness, and the almost reverent way in which he read from the "scriptures", took my mind hack to 1953, when his ferocity, his attack upon the Opposition for wanting to do precisely what the Government have now done, was exceeded only by the abuse which came from the noble Viscount (as he then was), Lord Swinton, who at that

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time led for the Government. I can assure the noble Earl, Lord Selkirk, that I am in complete agreement with him when he says that this should be the end of a chapter. And I certainly think that politics should be taken right out of road transport. If the noble Earl will listen to my plea he will do so. But I shall prove quite conclusively to your Lordships that the very people who are keeping politics in transport are the present Government.
When someone tells me that he thinks the end of a chapter has been reached, and that the time has come to take politics out of the matter, I always think that the chapter should be closed and that the book should be put away. But far from it. This fight is going on, and it is going on at the instigation of Her Majesty's Government. And there is to be no time limit for its duration, according to the present Bill. I am not going to fight again the battles of the past. There is more joy in Heaven over sinners that repent, I have always been told—even if they do make up a Conservative Government; and the noble Earl has given every sign of repentance, and abject repentance. Who are we on this side of the House, who have always shown an enlightened outlook upon this transport question, to refuse the noble Earl his repentance?
I feel it in my heart to be sorry for him. May I remind him of several things that happened in the past. I spent a pleasant Sunday reading speeches made by him and by the noble Earl, Lord Swinton, on the 1953 Act during the Committee stage, when I begged and pleaded with the Government, when I brought forward every argument I could think of, in logic and common sense, to preserve for the Transport Commission, so that it could fulfil its national duty, 16,000 vehicles. And I ask your Lordships to mark that figure 16,000. I was met with ridicule and abuse. I can remember, in the late hours of the night, the play that was made by the noble Earl who then led for the Government—I was just insane. Today, however, by this Bill, the Government are authorising the British Transport Commission to retain 15,350 vehicles—just 650 short of the number I pleaded for in 1953; and to reach that sensible conclusion three years have
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been lost and it has cost the British taxpayer the best part of £1 million in disposal costs. During that time the Disposals Board have not sold one vehicle which the British Transport Commission could not have sold themselves, in the course of their business, exercising their wisdom and discretion as an ordinary commercial concern. In point of fact, before the 1953 Act ever became law. 10.000 vehicles were ready for sale and were to be put on offer by the British Transport Commission. But I will not indulge in what could be a nice exercise in saying, "I told you so." I am glad that wisdom has arrived in the minds of the Government on this subject of transport. But their wisdom does not go far enough.
As I have said, on the day on which this Bill becomes an Act of Parliament the British Transport Commission will be authorised to retain 15,350 vehicles—7,750 general haulage, 1,100 special delivery, 2,000 contract hire, 4,000 parcels service and 500 meat delivery. The noble Earl mentioned competition between the national network and the independent hauliers. The figures are interesting. The number of A "Contract" licence and B licence vehicles, all over 2· tons unladen weight, for hire and reward in the hands of independent hauliers will be approximately 100,000; and there will be in the hands of C licence operators, 180.000 vehicles of over 2· tons unladen weight. So that, competing with the 15,350 vehicles of British Road Services, there will be 280,000 vehicles.
Let me make this confession. I have never been known as, and my dearest friends on this side of the House have never accused me of being, a whole-hog nationaliser; and at this stage perhaps I can confess that I was responsible for the removal of the C licence provision from the 1947 Act. At least, I had the blame for it; so perhaps after all these years I may now take the credit. I was certain that I was right then, and the passage of time has not altered my opinion. I would say to the noble Earl and to the House that the competition of the future is not going to be between British Road Services and the independent hauliers; it is going to be between both of them and industry which wishes to run its own transport.

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I have always held the view that the economic prosperity of this country depends upon industry tooling itself in the cheapest and most efficient manner. There never should be any arbitrary or artificial restriction on the way industry equips and tools itself to meet the battle of costs in the markets of the world. That is why, if it suited industry and if it were cheaper and more efficient for industry to run its own tools in the shape of road vehicles, I was always in favour of allowing industry to do so. I base my view on the sound theory that in this world nobody does anything for himself if he can get somebody else to do it better and more cheaply. That will be the test of the British Road Services and the independent hauliers. If they can supply industry with a more efficient and cheaper service than industry can provide for itself, they will win. It is not a question of competition, cut-throat or any other kind, between the two suppliers of this service. The noble Earl, Lord Selkirk, said that this Bill cuts road transport adrift from politics at last, and that the only test upon which this Bill is founded is the national interest. The Minister said the same thing in another place. That is why I join issue.
The first issue I wish to raise with the noble Earl, who skated over it with such delicacy, is this: why put in a provision, as an amendment to the original proposal in the Bill, to sterilise 7· per cent. of the general haulage fleet of British Road Services? May I briefly tell your Lordships the history of this matter? I am not going to gibe at the noble Earl about the reason why this Bill has came forward; I am not going to tell him that it was because of the complete failure of Government policy. They could not sell the vehicles—we told them that from the word, "Go". The then Minister of Transport (since we started with the White Paper of 1952 we have had four Ministers of Transport; that is enough to give any industry a pain in the stomach, and I do not wonder that this industry has suffered from violent ministerial indigestion) had to ascertain the number of vehicles which could be retained by British Road Services for general haulage. That figure was not capable of being decided by mathematical calculation. Had it been, since there are many experts in the Ministry of Transport who are good
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manipulators of slide-rules they could have found the number. So the question was put to the Chairman of the Disposals Board. He replied that, as near as he could say, it should be 7,750; and that number was put in the Bill.
Then the trouble started. There was agitation; there were rumblings from interested parties; and it was suggested that some formula should be arrived at by which the number could be reduced. During this time the Chairman of the British Transport Commission was approached, and he said that he did riot want to lose one of these vehicles: he could employ all the 7,750 in the national interest. Let us take that position for the moment. After all, Sir Brian Robertson is a Government-appointed official, and I suppose that he must be regarded as giving the Government advice in the national interest. I would not suggest that his advice to the Government is tinged with politics in any way. Why, then, was his advice—and the Minister admits that he wanted 7,750—and the advice of the Chairman of the Road Haulage Disposals Board, not taken? How was this mythical figure of 582 vehicles arrived at? What justification is there for that? It is only put in to reduce the number because some people were agitating. The very people who were agitating did not want 7,750 vehicles to be left with British Road Services; they did not want seven; they did not want one. What are the Government doing? They are saying to the British Road Services: "You must freeze, or put in a. mothball fleet, 582 vehicles, or 7· per cent. of your A licences." What a business proposition for any Government to put to an industrial concern, at a time when it is vitally necessary for this country to employ every one of its physical assets to the greatest degree!
As the Minister has said, and as I think the noble Earl has said to-day. British Road Services can apply to the twelve licensing authorities, and if they make their case they may obtain A licences for any of these 582 vehicles. And doubtless they will obtain them. That is true. So what is the position we have now? We have twelve arbitrators, they being the twelve licensing authorities, who will now arbitrate as to whether the British Road Services are to have extra A licences

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to cover these 582 vehicles. These 582 vehicles are spread over 300 depots, and the noble Earl knows as well as I do that, with the law as it stands, it is impossible to transfer one of these lorries from one depot to another. What is the object of this exercise?
I do not intend to probe this matter deeper now, but I shall put down an Amendment on the Committee stage, and I shall ask the noble Earl seriously to consider it. I hope that he will believe in my sincerity. We on this side of the House are as desirous of taking politics out of transport as anybody else in this country. Give the wretched industry a rest from politics; let them go out and do their job. But this was a political decision taken on behalf of the present Government. There was no sense in it. The noble Earl has not tried to defend it. It was a farcical formula of political expediency, and that is all. I have not the slightest doubt in my mind that these twelve licensing authorities will all come to decisions by different measures, and that on balance, the Transport Commission within twelve months will have more than 582 vehicles with A licences. But why the delay? Why put them to a great deal of paper work at a time when they have to get on with the job?
The next point that I quarrel with is again one of political expediency only. If the Government are going to say, "There is an end to this," why then do they want to dispose of the parcels services? Why do they want to sell a nationwide public utility which has proved to be to the nation's benefit and which, according to the prospectus they were forced to issue a little while ago, would make over £1 million profit in 1955 for the benefit of the taxpayer? Why do they want to say to British Road Services: "Go on. We are going to watch your parcels service for three or four years, and the bigger success you make of that undertaking, the sooner it will be sold up." That is what the Minister says: "I am going to wait and see how profit-earning and how prosperous this can be, and then I shall decide whether to sell it, or not." While it is a failure, or if ever they turn it into a failure, then the nation can carry it; but as soon as it is a profit-earning proposition (which it now is, to the tune of £1 million and over; and for 1956 I should
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think the profit will be greater) it is to be handed over to private enterprise. Was that a business decision, or a political decision? If your Lordships will forgive the vulgarity, it "stinks to high heaven" of politics.
This country owes a great debt of thanks to Major General Russell and his colleagues, who have laboured in the national interest against terrific odds to improve the service; and it is a service which we know must eventually, to reach its peak of performance, be in some way integrated with the trunk haulage service and the railways. What an incentive to them to say: "We will now reconstruct its capital and make it easier to sell"! The present Minister says that the last prospectus was so silly that only a humorist put in a tender for £10 million—and he made it a condition that the Treasury should lend him the £10 million. That is the only tender that was received. It has been said that the only tender that was made for the meat services was from a Billingsgate fishmonger. I do not know who advised the Government to put on the market this abortive prospectus which the present Minister says was about the silliest thing that could be imagined. If you are going to end the chapter, if you are going to say there shall be an end of politics in the industry, why say that you are going to carry on until such time as you can get a bid which you think acceptable for an enterprise which we all know has proved to be one of the best and most profit-earning of the whole of the British Transport Commission; then you will dispose of it?
So I say to the noble Earl, quite frankly: Take the industry out of politics!: you have buried it deeper in politics—because, whichever Government follow this one, if they are worthy of the name of custodians of the national interest, they are bound to rectify that state of affairs. Why do not the noble Earl and his colleagues go the whole hog? What are they going to gain? They have said not one word in this House in justification for doing what they propose; they have made not one effort to say that it will be in the national interest that a public utility which is making a profit for the benefit of the taxpayer should be sold to private enterprise. We on this side of the House will not divide against the Second Reading of this Bill, because we think

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it goes a long way. In all sincerity we want to ask the Government to go the rest of the way, not for political ideology, but because it has been proved to be commercial common sense.
May I read the words which were used by the Joint Parliamentary Secretary to the Ministry of Transport when he presented this Bill on Second Reading in another place? He said (OFFICIAL REPORT, Commons, Vol. 548 (No. 93), col. 1827):
"After careful consideration we came to the conclusion that the road trunk services are now a vital form of transport to industry and commerce. We felt that it would be entirely wrong to destroy an organisation of that kind.… To have done so. we felt, would have been to sacrifice a valuable national asset to an ideological prejudice. We, who on occasion of party controversy have been inclined to bring that reproach against honourable Members opposite, were anxious not to fall into the same error ourselves."
If that is the yardstick by which the Government arrived at their decision in regard to the haulage trunk services, why is a different yardstick put against the other great national asset, the parcel services?
I do not intend to waste any more of your Lordships' time. There will be two Amendments which we shall put down on the Committee stage to eradicate from this Bill what we consider the two great political manœuvres. There will be other Amendments, I suspect, which the noble Earl himself will want to put down. We shall probe and want to know when the Road Haulage Disposals Board is to be disbanded. In reply to a Parliamentary Question the Minister stated—the noble Earl will correct me if my figures are wrong—that salaries alone have come to about £40,000-odd. But he was quick to add that the Chairman of the Disposals Board refused to accept a salary. I do not know whether the noble Earl will think me unkind if I ask whether he received a tax free expense allowance. He might look into that question and let me know at a later date. I do not like these people who work for nothing; I believe in paying the rate for the job. That is a matter which we will probe upon the Committee stage. I repeat, with the utmost sincerity: Let us bury the differences between us. We on this side of the House are honestly intentioned to do so, but you cannot blame us for having great suspicion of the sincerity of the Government when in this Bill they retain
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two political decisions which we say are contrary to the national interest.
3.24 p.m.
LORD TEYNHAM: My Lords, I welcome this Bill as a whole, as I think it may lead to political peace in the industry in spite of what has been said by the noble Lord, Lord Lucas of Chilworth. I am not sure that the history of the Bill is quite as it should be, and I certainly do not come with any kind of repentance to the Bill. Perhaps before I go any further with the matter I should declare that I am a director of a road haulage company.
We have heard from the noble Earl to-day that there has been difficulty in the disposal of the large units of road haulage to private enterprise—units which could be used on our long-distance trunk routes. But when were those large units offered? They were offered on the eve of the General Election, and I would say that it is hardly likely that the Minister of Transport could expect satisfactory tenders for any large units at that time. I should like to ask Her Majesty's Government whether the S. 4 list has been offered again since the General Election and, if not, why not. So far as I am aware, larger units of twenty and over have been offered only between March and April, 1955. Not so long ago, I believe a deputation visited the Minister of Transport and gave almost a pledge that groups were prepared to purchase the larger units. These groups were already owners of fifty or more vehicles and had the experience of running trunk routes. I should like to ask Her Majesty's Government why favourable consideration was not given to this deputation who were anxious to buy the larger units. I can only surmise that Her Majesty's Government were perhaps unduly influenced by the managers of British Road Services, who have done all they can—and, I would say, rightly so from their point of view—to prevent their competitors, private enterprise, from entering the trunk routes.
I think it is true to say that, of the 19,000 vehicles which we have heard to-day have been sold, only about 2,000—say 15 per cent—were in the group of 12-tonners, and that, of that 15 per cent., none have been offered in good sizeable lots. There is no doubt that the small man has been given an opportunity to

19
get back into the industry, but I am not by any means convinced that the large operator who wants thirty to fifty vehicles has been given a proper opportunity, except at a very unlikely and disturbed period during Election time. In another place, the Minister of Transport has said that if private enterprise had come forward and made reasonable offers, it could have played its part in these trunk services, but that, for one reason or another, they had not been able to do so. I am at a loss to understand this statement, when private enterprise have never had a favourable opportunity to purchase the necessary long-distance units.
Apart from the bad timing of list S.4 when it was offered, and also the denial of a second opportunity for tendering for these units, many of them were badly consolidated. Let me give an example. For instance, one unit which was offered included these extraordinary miscellaneous items: one six-wheeler, two eight-wheelers, two tippers, one van, one truck, three livestock, three furniture and one meat carrier. I suggest that this was certainly not a unit likely to be bought by a haulier who wished to expand his business. On the contrary, I think it is the kind of unit which would attract a dealer to sell off in small lots.
I maintain that the Government's failure to re-offer list S.4 in suitably constructed units has been a grave mistake, and has been proved wrong by the successful sales from other lists offered for sale since the date of the General Election. I certainly do not propose to ask Her Majesty's Government to reopen the whole of this matter again, as I am anxious, like all of us, for political peace in this industry; but I must say that I am very disappointed at the way in which the sales of the vehicles on the S.4 list have been handled. Private enterprise is quite capable of running efficient trunk services, given the opportunity. I would say that the real effect of the Government's decision is to place the British Transport Commission in the position of a monopoly in long-distance haulage which is contrary to the intention of the 1953 Act.
3.30 p.m.
LORD HURCOMB: My Lords, much could be said about the course of events which has made many of the provisions of this Bill inevitable, but I am not going to go over old ground. I cannot profess to view with any surprise the fact that Her Majesty's Government have been forced to take the action which they are now proposing. After the change of Government it was decided (I think, naturally enough, unfortunately) that the Commission should not be consulted at all. We were told of the decisions the Government had reached only after they had been come to, and when we were asked to express our view on the nature of the machinery proposed we were bound in all good faith to say that we thought it was unworkable.
But all that is past. It would have been, as I said at the time, easy to sell 10,000, or perhaps 15,000, lorries as lorries, not with all the property, liabilities and so on attached to them. I envisaged then that could have been done in twelve or eighteen months, and of course it is not surprising that it has been possible to achieve that result, or a rather greater one, when the process has been spread over several years. But I should like again to say, as I did when I last had the privilege of addressing your Lordships, that I appreciate sincerely the degree of realism which the present Minister and Her Majesty's Government have brought to the facts as they are now disclosing themselves. It cannot have been easy to frame the proposals in this Bill, a fact which one can appreciate all the more after listening to the noble Lord, Lord Teynham, who speaks for interests which have had a large part in pressing their views upon Her Majesty's Government.
I want to deal this afternoon with only two points. The first is the levy. Everyone must be glad to see the last of that. As your Lordships will remember, it was put forward three or four years ago as the cornerstone of Her Majesty's Government's policy. But it was very quickly found not to be out of the right sort of quarry from which one could safely build a large structure, and it crumbled very quickly into disintegration under pressure. But there is one point about it which emerges in this Bill, and that is the way in which the final amount due to the Commission is assessed. I am

21
sure the Minister and his advisers have done their best to be fair to the Commission, but I feel that at this stage, when no one can foresee exactly how far the remaining processes of liquidation are to go, no one can assess the proper sum with any great approach to accuracy. The position would be very much easier if the fate of the parcels service were taken out of the arena of doubt and controversy. With that out of the way, the proposed settlement might be perfectly fair and somewhere reasonably near the mark.
That brings me to the only other point to which I want to refer this afternoon and to which Lord Lucas of Chilworth has already referred; that is, the position of the parcels service. It is admitted on all sides that that service has been built up into a fine, nation-wide—I will use that word rather than the word "national," though it is both—service very much valued by industry, and of great value particularly, I think, to small traders who cannot, for one reason or another, resort to fleets under C licences. I cannot see why that particular service cannot at this stage be left finally with the Transport Commission. It is essentially part of a national service. It is efficient. No one else will provide it on the same universal scale as the Commission is able to do. It does not lose money. As the noble Lord, Lord Lucas of Chilworth said, it makes money, and it is surely open to great objection that a service of that kind should be created with the support of public capital, and by use of the time and enthusiasm of public servants nursed into a position in which it is to be sold away to private enterprise.
This seems to me to be more difficult to justify when one remembers that over twenty years ago the old railway companies, long before they were nationalised, thought it right and proper, and in the interests of their shareholders, to own that service 100 per cent. The vehicles used to run about with the names of Pickford and Carter Paterson on them, but they were owned 100 per cent. by the four amalgamated companies. If that was a right and businesslike proceeding for private railway companies it is difficult to appreciate why it is not thought proper that the public Transport Commission should retain it, and retain the advantages which have been built up
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by the use of public credit, public money and public time.
There will be on the Committee stage of the Bill, no doubt, points to be raised on the machinery proposed in regard to this matter. The power that the Minister is taking to appoint a minority of the directors of the new company seems to me, on any explanations hitherto given, a proposition very difficult to justify. The Minister has said that they are not to be there just as his spies on the Transport Commission—it is hardly necessary to say such a thing, but he was attacked and had to reply. They ought not to be necessary to advise him over and above the advice he may get direct from the Con-Emission. On what ground is it suggested they have to be there? Is it as some guarantee to those who may want to buy the undertaking that it is really all right? I feel that even at this late stage that particular proposal might well be looked at again, because the explanations and justifications which have been given for it do not seem to me to be by any means conclusive.
The last point I should like to make is this. Everyone must agree that it would be a Godsend if the transport problem could be taken out of politics. It is. I fear, easy to be too optimistic about that, because in my view there is a fundamental problem, which will go on nagging at whatever Government is in power, for a long time to come. It will not be solved by restoring competition between road and rail, and it is not only an issue of private against public enterprise in respect of one branch of transport. There is the underlying difficulty that a public transport service, however given, must be subject, if not in law at any rate in practice, to all sorts of obligations and restrictions from which small individual enterprises are free. There is, therefore, a fundamental public issue which Governments from time to time will have to face. But at least the problem can be taken out of the acute political controversy from which it has suffered for many years past.
For that reason I would ask Her Majesty's, Government, late though the stage may be, to consider once more whether they could not now deal finally with this question of the parcels service. I feel, as does the noble Lord, Lord Lucas of Chilworth, that if this transaction of selling it off ever in fact did

23
succeed—and it is generally agreed that it is not going to succeed yet—it would invite reversal. The Bill is keeping alive this very controversy that we should all like to see finally buried. I quite appreciate that the answer may be that this is as far as it is possible for the Government to go at the moment. I myself think it would be right to settle it definitely now and I venture to think it would be wise to do so. It may not be practicable, after all that has happened, for the Minister or Her Majesty's Government to go that far at this moment. If we must put up with uncertainty for another two or three years while the service is being nursed into company form and an attempt is made to sell it, I shall regret it. But if that must be so, I can only conclude what I have to say by urging again Her Majesty's Government to realise that they are inviting a reversal of that particular part of their present legislation.
3.41 p.m.
LORD GIFFORD: My Lords, I do not propose to detain your Lordships for more than a few moments. Possibly at this stage the policy which has been adopted by Her Majesty's Government in the present Bill is inevitable, but there is no doubt that many of your Lordships on this side of the House have been disappointed at the lack of response to offers of the larger units. Some of us feel that this may be because these units were not offered in attractive enough parcels (if I may use that term), and certainly in many cases different types of vehicles were lumped together in a unit. As the noble Lord, Lord Teynham, has already said, these offers were made just before the General Election. Some of us on this side of the House would be glad if, in his reply, the noble Earl, Lord Selkirk, could reassure us on this point, because, as I say, some of us are not altogether happy that the offers were made in such a form as to be the most attractive to the large purchasers.
3.42 p.m.
THE EARL OF SELKIRK: My Lords, we all welcome the noble Lord, Lord Lucas of Chilworth, back from his sojourn on to his favourite stamping ground of road haulage. He has lost in the balmy air of the Pacific none of that revivalist oratory which we so often enjoy
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in this House, although I think he speaks with slightly more conviction when he talks about competition than when he talks about sin.
LORD LUCAS OF CHILWORTH: I quite agree. I do not know very much about sin.
THE EARL OF SELKIRK: I thought that was the case. It is not much good the noble Lord coming along nearly ten years after the 1947 Act, and meekly telling us that he was never a whole-hearted nationaliser. It is a little late for him to talk like that.
What has struck me about this debate is quite interesting. The noble Lord, Lord Lucas of Chilworth, tells us that we were unduly influenced by the Road Haulage Association; the noble Lord, Lord Teynham, says that we were unduly influenced by the managers of the British Road Services, whereas the noble Lord, Lord Hurcomb, who knows more about it than any of us, congratulates the Government on their realism. We have to keep a sense of balance between the points of view which have been expressed and I feel a great sense of strength in that. We have been criticised on this question of the trunk service, in that it was not offered in the way which the noble Lord, Lord Teynham, says it could have been offered. But it was the view of the Disposals Board that better terms would not be obtained, and they did not put up these odd lots; they were put up as operating lots. The Disposals Board may have been wrong—I agree that is possible—but that was the advice which they gave, and we thought they were most suited to give it. That is an answer to the point raised by the noble Lord, Lord Gifford. They even went so far as to try to ask for possible purchasers to put correct lots, so to speak, together, so that as far as possible it would make them suitable for purchase.
A number of points have been raised, chiefly in regard to the two points made by the noble Lord, Lord Lucas of Chilworth, which will be dealt with on the Committee stage, I understand. I would only say this to the noble Lord on what are called the additional vehicles. I do not think that this is a major point which need be of great concern to your Lordships. The position is that there are a certain number of additional vehicles, and whether these were included in the figure

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or not is a matter of opinion. That was referred to in discussion between Sir Malcolm Trustram Eve, representatives of the Road Haulage Association and the Chairman of British Transport Commission. This was the figure which they were prepared to agree to.
LORD LUCAS OF CHILWORTH: Force majeure.
THE EARL OF SELKIRK: It was not force majeure at all. They were quite free to agree to it under the charmanship of Sir Malcolm Trustram Eve.
LORD LUCAS OF CHILWORTH: Supposing, for instance, Sir Brian Robertson had adopted the attitude he adopted from the word "Go": "I do not want to give up one vehicle; I do not agree", what would have happened?
THE EARL OF SELKIRK: It is no use the noble Lord asking me what would have happened if something else had taken place, because it is quite irrelevant. That is something on which the parties concerned may agree.
LORD LUCAS OF CHILWORTH: He would have got the sack.
THE EARL OF SELKIRK: I see no reason for disturbing it.
Turning now to the parcels service, that is a different proposition from that in the case of the trunk services. The story is this: that the parcels service in any case will be run as a unit. It will show separate accounts and will be a separate company organisation as such, and I do not think that a very strong case has been made for disturbing the decision which was reached in 1953 in this matter. The service is being kept together; it has never been entirely integrated with the railway services over ten years. I should like to add this further point. We always regard this question of capital in our nationalised industries as a sort of automatic thing which flows from some everlasting spring. It is becoming increasingly clear to us all that that is not the case. We all want to get the big organisations on to a credit-worthy basis. It may be a very small part of it—that I agree—and it may be that it is only a small fractional part of the vast organisation. None the less, those are considerations and points which we can consider further in the course of our Committee
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stage, if we want to. I do not think I need say anything more except to ask that the Bill. be now given a Second Reading.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

SUGAR BILL
3.47 p.m.
Order of the Day for the Second Reading read.
EARL. ST. ALDWYN: My Lords, this Bill may look complicated at first sight, but I think on closer examination it becomes clear that in essentials the main provisions are fairly simple and straightforward. The primary purpose of the Bill is, first, to bring to an end the present system of State trading in sugar and to return the trade to private hands, and, secondly, to achieve this whilst at the same time enabling the Government to continue to implement to the full their commitments to Commonwealth sugar exporters under the Commonwealth Sugar Agreement and to the sugar beet grower at home under the Agriculture Act, 1947.
It is important, when considering the Bill, to bear in mind that in general the history of legislation on sugar for the past fifty years has been a history of agreed legislation. That is why I wish to emphasise to your Lordships at the outset that this Bill in no way affects the Government's continuing obligations towards the cane producer in the Commonwealth and the beet farmer at home.
Before I describe the main provisions of the Bill, it may help your Lordships if I try to explain briefly the present arrangements for dealing with sugar. Under the Commonwealth Sugar Agreement (an Agreement negotiated in its early stages by the Party opposite, when they were in power, and concluded by my right honourable friend, the present Secretary of State for the Home Department, when he was Minister of Food in 1951), the Government are committed until at least the end of 1963 to buy from the Commonwealth fixed annual quantities of sugar, totalling 1,568,000 tons, at prices negotiated each November in accordance with an agreed formula. Moreover, there is available under the Commonwealth Sugar Agreement an

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additional quantity of so-called "free" sugar totalling 807,000 tons.
Commonwealth sugar enjoys tariff protection in the United Kingdom and Canada, and after Commonwealth producers have met the important requirements of the Canadian refiners they should have no difficulty in selling the balance of their "free" sugar in the United Kingdom. We in this country are at present eating about 2·million tons of raw sugar a year. This consists of the 1· million tons of Commonwealth "negotiated price" sugar and, depending on the yields of the crop, about 650,000 tons coming through the British Sugar Corporation from our own sugar beet production. The balance of what we need comes from Commonwealth "free" sugar or from foreign sources in the open market.
Sugar beet is a guaranteed crop under the Agriculture Act, 1947. At present a guaranteed price fixed in the light of the Annual Agricultural Review is paid for all sugar beet grown from the acreage approved by the Government. This guarantee is implemented by the British Sugar Corporation, which buys beet from the grower at the guaranteed price and sells its sugar at the prevailing internal price. To-day, this price is largely determined by the prices at which my Department buys sugar from the Commonwealth and from foreign sources. At present, the Commonwealth negotiated price, and the cost of producing sugar at home from our own sugar beet, are both substantially higher than the so-called world price. Therefore all sugar imported by my Department, irrespective of origin or price, is resold to the refiners and the trade generally at a common price sufficient to cover the average cost to the Department. These arrangements at present result in an internal price in the United Kingdom which is above the world price, and this price determines the price the British Sugar Corporation can get for its sugar.
That brief review of the present arrangements will, I hope, have shown your Lordships the nature of the problem for which a solution has to be found if State trading is to be brought to an end. The problem is, in short, how to continue to average the price of sugar for which a fixed contract price is agreed with
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the prices of "free" sugar, whilst still giving importers and other users the maximum possible freedom to revert to normal commercial practices. What is the solution proposed in this Bill? It is that the task of averaging the prices should be carried out through the agency of a small Sugar Board—a chairman and not more than four members. The Board will have a statutory obligation, first to buy Commonwealth sugar that the Government has contracted to take at the negotiated price, and, secondly, to ensure that the British Sugar Corporation is enabled to pay the guaranteed price for sugar beet.
Clause 1 of the Bill provides that the Board must sell the sugar it buys in the country of origin before shipment at the best price obtainable. Thus the sugar trade will resume responsibility for the physical handling of the sugar, the taking of freight, insurances and the like. The Board will not have any responsibility for the balance of sugar which we import from the Commonwealth. However, we are quite sure that, with the aid of the tariff preference which Commonwealth sugar enjoys in this country, and with the assurance given by the refiners that they will make it their practice to prefer Commonwealth sugar for their home trade requirements, provided that it is offered competitively, Commonwealth exporters will have no difficulty in selling here the balance of their exports after they have met the needs of their important customers in Canada.
There remains the problem of how to average the prices. So long as the "world" or free market price of sugar is lower than the Commonwealth negotiated price and the cost of producing sugar from beet (and that is the pattern we must expect will normally prevail), the Sugar Board will make a loss. It will cover this loss out of the proceeds of a surcharge to be levied on all sugar and on the sugar content of manufactured goods coming into this country. If, on the other hand, the "negotiated price" were below the "world price," the Board would then earn a surplus and would pay it out as a rebate instead of making a surcharge. This averaging arrangement—for that is what the surcharge is—does not mean a higher charge on sugar. It will simply mean that the home consumer will continue to pay the true average cost of the sugar he eats.

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Moreover, although at first glance your Lordships may find the surcharge and other similar provisions of the Bill in Clauses 7 to 16 rather fearsome, from the trader's point of view the system is simple. The surcharge will be collected by the Commissioners of Customs and Excise as the Board's agent at the same time as customs or excise duty is collected. Similarly, on exports the surcharge will be repaid just as duty is drawn back. So the traders will be using procedures of Customs and Excise to which they have been long accustomed.
May I now turn to the special provisions in Clauses 17 to 24 of the Bill dealing with the British Sugar Corporation. Some twenty years ago the Corporation was an untried and heterogeneous collection of private companies. Today it is a solid, efficient organisation which has the confidence of the farming community and the good will of the refiners. The Government can therefore see no grounds for interfering in any way with the structure of the Corporation. The Bill must, however, bring up to date the legislative framework within which the Corporation operates. Accordingly, in the first place, under Clause 32 of the Bill, the Sugar Industry (Reorganisation) Act, 1936, and the war-time Sugar Industry Act, 1942, will be repealed and the Sugar Commission established under the 1936 Act and suspended under the 1942 Act will be dissolved.
In the second place, the Bill, in Clause 17, lays down the responsibility of the British Sugar Corporation to contract for the acreage of sugar beet authorised by the Government at the price and on the terms determined under the Review procedure. Provisions have also been included in Clause 19 to enable Ministers to continue incentive payments to the Corporation for the purpose of promoting economy and efficiency. Moreover, your Lordships will, I am sure, be glad to note that, as a result of an Amendment to the Bill carried in another place, any agreement made to encourage efficiency will provide that the purposes for which incentive payments shall be used will include benefits for persons employed by the Corporation.
This House has always shown a keen interest in the promotion of research. Your Lordships will therefore welcome the continuation, in Clause 18 of this Bill,
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of the provisions in. the Agriculture (Miscellaneous Provisions) Act, 1954, for the promotion of research and education in matters affecting the growing of homegrown beet. I understand that both the growers and the Corporation, who contribute to the fund to finance the programme, are satisfied that they are getting considerable benefit from the work being clone in this field. The Bill also provides, in Clauses 25 and 26, for continuing the present kind of market-sharing arrangements between the British Sugar Corporation and the other refiners. All of us, I think, recognise, reluctantly perhaps, that market-sharing arrangements are necessary to ensure adequate outlets on the most economical terms for the beet sugar which the Corporation produces after implementing the guarantee to the sugar beet growers.
Nevertheless, your Lordships may well feel some anxiety about the effects which arrangements of this kind might have on the interests of users and consumers of sugar. I feel sure, however, that those interests will be adequately protected, because the Bill provides two safeguards. First, it puts a statutory obligation on the Minister, when deciding whether to approve a sugar refining agreement (as these market-sharing arrangements are called), to take into account the effect it will have upon the interests of users and consumers of sugar. Secondly, the Bill gives specific: powers to the Minister to secure modifications in a sugar refining agreement if its operation is bearing harshly on users and consumers. Consumers, too, can feel assured about the price of sugar. The principal refiners have offered to give my right honourable friend the Chancellor of the Exchequer, an undertaking which will serve to regulate their margins on the lines indicated in Clause 27 of the Bill. The formula they have offered, I understand, is expected to produce results which will be virtually the same as those produced by the Agreement which at present exists. By this Agreement the refiners bound themselves some years ago to regulate their margins in accordance with a formula based upon an up-to-date investigation of their costs.
My right honourable friend is confident that the provisions of this Bill will produce conditions which will enable the London Terminal Market in sugar to reopen and to play an important part,

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as it did before the war, in earning foreign exchange. The Bill will bring to an end State trading in sugar. On the other hand, the Government will continue to stand firmly behind the Commonwealth Sugar Agreement and its obligations under the Agriculture Act, 1947, towards the producer of home-grown beet. I therefore commend the Bill to this House, and beg to move that it be now read a second time.
Moved, That the Bill be now read 2a.—(Earl St. Aldwyn.)
4.4 p.m.
THE EARL OF LISTOWEL: My Lords, it is perhaps a rather curious coincidence that your Lordships have been asked this afternoon to approve two Bills both of which bear witness to the Government's firm—I had almost said dogmatic—belief in the efficacy of private enterprise. So far as this Bill is concerned, we can agree with the Government—and we are very glad to be able to do so—about some of the policy it contains, while I am afraid I must admit at the outset that we disagree with a large part of it. We can go a certain distance together about Commonwealth and Colonial economic policy, and, of course, about the implementation of the guarantees to British agriculture under the 1947 Act. This Bill, as the noble Earl has rightly pointed out, effectively safeguards our obligations towards the Commonwealth sugar producers under the Commonwealth Sugar Agreement and also our obligations to growers of sugar beet at home under the price guarantees of the 1947 Act.
We remain—and I am relieved to find that this situation is unaltered—the principal market for all sugar bought under contractual arrangements with the British Government from the Colonies. No one who knows the island territories in the West Indies, which contribute the bulk of the one and a half million tons of Commonwealth sugar imported every year, and their dependence still, in spite of all that has happened since the war, on this single export crop, will underestimate the value to them of the Commonwealth Sugar Agreement. I am sure that the noble Lords, Lord Colyton and Lord Hall, both of whom are familiar with the West Indies, will agree with that statement. There was, of course, no contract of any kind between the Government and
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sugar producers before the war. Your Lordships will recall that the widespread disturbances in the West Indies which preceded the appointment of the Royal Commission in 1938 were directly due to unemployment and poverty resulting from the disastrous fall in the world price of sugar. Since the war, there has been relative stability in all the West Indian territories. Employment and wages are no longer as they were before the war, at the mercy of the ups and downs of the world's sugar market. Now, at last, the West Indies have an assured long-term market in this country, and can rely on getting a fair price related to the cost of production for all the sugar covered by the Commonwealth Sugar Agreement.
As I understand the Bill, the Sugar Board will have a statutory duty—it will not be a permissive matter—to buy Commonwealth sugar at the negotiated price. In this capacity, it is simply an agent for doing what the Government has hitherto done through different Government Departments. I believe, from what I have heard, that the sugar producers, whether or not they are parties to the Agreement, both in the Colonies and in the independent Commonwealth countries, have been consulted about this new machinery, and they are satisfied that they will be no worse off than at the present time.
Some doubt has been expressed, both inside and outside Parliament, as to whether a political Party which is pledged to private trading in food as a matter of policy, may not eventually allow the Commonwealth Sugar Agreement to lapse. I think it is reassuring to note that the present Government have already extended the Agreement for a further period of one year until the end of 1963. I will not go on to draw any Party conclusions as to what the position may be after 1963. I think that this shows that Ministers who have stated their opinion publicly about the value of this undertaking to buy Commonwealth sugar at a guaranteed price, are not only conscious of the importance of this undertaking but are prepared to carry it out in practice. I hope this means that the post-war policy of a guaranteed market in this country for Commonwealth sugar has now been accepted by both our main political Parties. I think it will take a little longer

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time for our noble friends who normally occupy the Benches a little further along on this side of the House to do so.
Turning now from cane sugar to sugar beet, I think noble Lords will agree that it is no less desirable, on strategic as well as agricultural grounds, that the growers should continue to have the advantage, which they have enjoyed in the past, of a guaranteed price. The Bill places squarely on the British Sugar Corporation the duty of buying the sugar beet crop at the guaranteed price. This should give farmers the confidence they need to go on producing the sugar beet we require.
That, I am afraid, is about as far as we can go now in company with noble Lords opposite representing Her Majesty's Government. I should like now to explain why we regard this alternative machinery for carrying out our obligations to the sugar producers as either undesirable (because a satisfactory alternative ought to have been worked out before we reached this stage) or as unnecessary. I need hardly remind your Lordships that there is a basic difference of opinion between noble Lords on this side of the House and the Government about the best method of buying essential foodstuffs. We believe that Government purchase, or purchase by marketing board, is more economical and efficient than purchase by a multitude of private traders. This view is not a dogma, though noble Lords opposite may regard it as such, because it is based on the acknowledged success of State trading during the war and for several years after the war. But, as the noble Earl explicitly said, the Government want to hand as much as possible of the food trade back to the middlemen.
That is the main purpose of this Bill: it is intended to bring back traders and importers into the distribution of sugar. It sets up a Sugar Board, but a board limited in its powers and functions so as to interfere as little as possible with the activities of those businessmen who are resuming their part in the distribution of sugar between the producers and the consumers. The Board will be little more than an accountancy agency—I believe that that was how the Minister of Agriculture described it in another place. The physical handling of sugar from the moment it leaves the growers until the
34
moment it reaches the refineries or warehouses, will be done by different forms of private enterprise.
This Bill, with its complicated and expensive marketing machinery, would have been quite unnecessary if the Government had continued to buy sugar, as it did so successfully for many years. When the Government proposed to scrap the Ministry of Food, we suggested that its trading functions should be transferred to the Board of Trade. The noble Earl may remember that my noble and learned friend Lord Jowitt and I expressed this view when the Order came before the House. What a lot of money and what a lot of work that simple arrangement would have saved! However, the Government have decided, as a matter of policy, to stop State purchase, so as to give the maximum scope and the maximum freedom for private enterprise. That being so, we have to accept the inevitable; and it is clear that a statutory body of some kind, such as the Sugar Board, is indispensable to safeguard our existing commitments. Therefore we welcome the setting up of this Board, while we regret that its powers have been narrowed down to such a limiting extent in the interests of the middlemen. It is authorised only to buy sugar imported by contract under the Commonwealth Sugar Agreement. In our view it should have been allowed to buy any Commonwealth sugar that the market here can safely be assumed to be able to absorb; and if the demand for sugar in the home market should exceed the capacity of Commonwealth producers, why should not the Board be free to go into the open market for foreign sugar? I realise, of course, that this is directly contrary to Government policy. The Government do not desire this to be a full marketing board. Their deliberate policy is to keep its powers to a minimum, however much the profit margins of a whole host of traders may add in the end to the cost of sugar and products containing sugar to the consumers.
My next objection to the Bill relates to the method it proposes for closing the gap, when there is one—and, as the noble Earl pointed out, there is a gap at the moment—between the guaranteed price for sugar and the commercial price. The proposal in the Bill is that when the free market price is lower than the

35
guaranteed price, the Board will recover this loss on their sales by a surcharge on sugar. This means that the consumers of sugar and other foodstuffs containing sugar will pay the whole cost of supporting the Commonwealth and the home growers of sugar. Surely the responsibility for sheltering the sugar industry, whether at home or abroad, is a national responsibility, which should fall equally on every adult citizen and not merely on those who eat sugar in one form or another, and presumably proportionately to the amount of sugar they eat. That is the essence of the Bill.
May I point out that diabetics cannot eat any sugar; they are forbidden to eat it—in fact, it is poison to them—and they are deprived of their responsibility as citizens. Children are probably the largest consumers, so that large families will pay much more than single persons. As noble Lords are aware, indirect taxation is always regressive and the poor man or woman will pay as much as the well-to-do. These inequitable effects of concealing a subsidy in the shop price of sugar could have been avoided if the difference between the guaranteed and the market prices, when the market price is lower than the guaranteed price, had come out of direct taxation. That is how we pay the subsidies arising from price guarantees by our own "Review" commodities and I cannot see why sugar could not have been treated in the same way—by subsidies which could have been paid out of direct taxation to both the Commonwealth and the home growers of sugar whenever their sugar was more expensive than sugar in the open market.
My final objection to the Bill is that it fails to make the British Sugar Corporation a proper, normal public utility. This body is an extraordinary hybrid. It is publicly controlled and faithfully carries out Government policy. Yet it is owned by a number of sleeping partners, shareholders with no say whatever in the management of the concern. No one disputes the fact that the British Sugar Corporation has an excellent record or doubts that it will continue in future to show its past efficiency, but there are reasons to suppose that it could be even more efficient than it is now if it were organised in the same way as other public utilities, such as the gas or the electricity
36
industries, with public ownership of its assets as well as public control of managerial policy. I believe that these private shareholders are a handicap to the Corporation. That is not merely a belief of my own; I hope I can show your Lordships that there are good reasons for holding this view. The first reason is that there is an agreement, made in 1952, which entitles the shareholders to a share in any economies that the Corporation may be able to make. I do not say that as a result of this agreement the added income of the shareholders is excessive or that the rate of interest that they receive is unreasonably high, but we on this side of the House should like all the benefits of increased efficiency on the part of the Corporation either to be ploughed back into the industry or to be used to improve the lot of its workers.
The second reason is that the Corporation has to negotiate with the sugar refiners about marketing rights. As your Lordships are aware, by the agreement made in 1937 the country is divided into watertight compartments for marketing areas, and however unexceptionable the conduct of the refiners might have been in the past and however unexceptionable it might continue to be, I think it is undesirable, on public grounds, that they should own a substantial shareholding in the Corporation at the very moment they are negotiating for marketing rights. So I cannot help feeling that this body, though it may have worked well in the past, would work even better if organised in exactly the same way as any other monopoly performing important functions in the public interest and susceptible to improvement in its efficiency under the ordinary forces of supply and demand. I have stated our objections to the Bill, with which I am no doubt the noble Earl is familiar, and although we shall not press the matter to a Division, we should like your Lordships to be fully aware that we do not share the views of the Government on these important matters of policy.
4.20 p.m.
LORD JESSEL: My Lords, I should like to support this Bill, chiefly because, as the noble Earl, Lord St. Aldwyn, said in his opening remarks, its main purpose is to end State trading in sugar and, at the same time, to honour the Common-

37
wealth Sugar Agreement and protect the sugar industry at home. The noble Earl in charge of the Bill has explained to us most lucidly its rather complicated mechanics, and I am not going to try and follow him in that direction. He said that the Bill might appear complicated, but was, in fact, quite simple. However, having heard his opening speech, and the remarks of the noble Earl, Lord Listowel, I think the actual details need a good deal of study. There is one small point I should like to make in regard to Clause 1 (1), which says:
"There shall be established a Board, to be called the Sugar Board, who shall, as from the appointed day, perform the functions assigned to them by or under this Act."
Are the Government able to tell us when the appointed day is going to be? Clause 35 says that
"different days may be appointed for the purposes of different provisions of this Act.…"
I feel that that makes it all the more important for the various interests concerned to be informed as soon as possible what is to be the appointed day. It should not be long before this Bill to which your Lordships are asked to give a Second Reading this afternoon becomes an Act of Parliament, and I hope it may be possible within a matter of months for the Sugar Board to be authorised to start functioning.
4.23 p.m.
EARL ST. ALDWYN: My Lords, I am glad that the noble Earl, Lord Listowel, can join with us, at least in regard to some portions of this Bill. I appreciate that there are certain fundamental differences of opinion on which, no matter what I or anybody else on this side of the House may say, he will not be greatly influenced. The noble Earl touched on several points on which I should like to say a word or two. As I understand it, he would like to see any loss made on the sale of sugar paid for by the Exchequer, rather than by the consumers, as is suggested in the Bill. But what is proposed in the Bill represents no change in principle. It is, in fact, what has been happening under the present arrangement. As I see it, the only advantage of the suggestion made by the noble Earl would be to enable some future Government to subsidise the consumer of sugar. That, I imagine, is the intention: that to keep the price as low as possible, the Ex-
38
chequer should be pouring this money in, instead of the consumer paying a reasonable price.
THE EARL OF LISTOWEL: I am sorry that the noble Earl has used the words "pouring this money in," because they may lead to misunderstanding. I am not suggesting that any more money should be paid than at the moment, but only that it should be paid out of general taxation, instead of out of the shop price of sugar.
EARL ST. ALDWYN: I appreciate that the diabetic does at the moment get off scot-free, but he suffers from a number of other troubles, and personally I do not think the position is unfair. As regards the large family, there are certain members of your Lordships' House who have quite large families. The demand for sugar in various forms by their progeny is not seriously restricted at the moment, and I trust that noble Lords in that position will continue to see that their children get a fair and proper proportion of sweets.
The noble Earl, Lord Listowel, also referred to the question of the private shareholder in the British Sugar Corporation. I think we must remember, first, the fact that the rate of interest paid by the Corporation reached 5 per cent. two years ago for the first time in its history. One can hardly say that there is an excessive rate of interest, compared with that of other undertakings. It has also been suggested (I think I may conveniently mention the point here) that as the assets grow the value of the shares will be rather out of proportion to what it should be. But the Corporation's assets are largely in machinery of various types, and it would be difficult to realise on them if the Corporation were wound up. I feel that the value of these shares must be judged by their Stock Exchange price to-day, which is considerably below par. My noble friend Lord Jessel raised the question of the appointed day. As your Lordships will appreciate, it will take a little time to set up the Sugar Board. It will be necessary to find offices, and there are bound to be one or two other delaying matters. However, to put it broadly, I hope that it will be possible to get tile Board into operation within three or four months after this Bill receives the Rod al Assent.
On Question, Fill read 2a, and committed.

JUSTICES OF THE PEACE ACT, 1361 (AMENDMENT) BILL now MAGISTRATES' COURTS (APPEALS FROM BINDING OVER ORDERS) BILL.
4.28 p.m.
Read 3a (according to Order), with the Amendments, and passed, and returned to the Commons.

BUSINESS OF THE HOUSE
4.29 p.m.
THE LORD PRESIDENT OF THE COUNCIL (THE MARQUESS OF SALISBURY): My Lords, before the House adjourns I should like to make a statement on Business for this and next week. As your Lordships will know, the noble Lord, Lord Pethick-Lawrence, has down for tomorrow a Motion on the economic situation. All of us had hoped that the debate on that Motion could be concluded tomorrow, but unfortunately it has proved such a popular topic that there are now no fewer than sixteen names on the list of speakers—and economics is not a subject with which any noble Lord can deal in the course of a brief speech. Therefore, I have come to the conclusion (and after consultation with the noble Viscount, Lord Alexander of Hillsborough, I understand that he shares my view) that we must make up our minds to divide the debate into two days. The first day would be tomorrow, and I have suggested to the noble Viscount—and again I understand that he agrees—that the second day should be postponed until the following Tuesday.
We had considered the possibility of Thursday, but there is already on the Paper an important Motion in the name of the noble Lord, Lord Rochdale, which it would be unfortunate to postpone. On the following Tuesday there are two Bills, the Clean Air Bill and one other, which I think will not take a great time. Therefore I would suggest, for your Lordships' approval, that we should get as far as we can to-morrow, say possibly up to half past six, or something of that kind, and that the remainder of the debate should be continued after the two Bills on the following Tuesday. I hope that will be for the convenience of the House.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, I am obliged to the noble Marquess for making that statement. Of course, what we are a little anxious about is that if, by half past six to-morrow, we have quite a number of speakers still left, we do not want to deal with the main part of what we consider to be an important Motion late in the evening of Tuesday. If there is not much in the two Bills which is likely to cause a great deal of controversy it would not matter a great deal. But if they are going to take a little time we should prefer, if the noble Marquess the Leader of the House could see his way to get the House to agree, to finish the economic debate and take these small Bills afterwards.
THE MARQUESS OF SALISBURY: My Lords, that is, of course, a possibility. It is contrary to the usual practice of the House; on a Tuesday, Bills usually come first. I quite realise the importance of what the noble Viscount has said, and perhaps it would be possible to go on a little longer tomorrow, say, seven o'clock. That would give us four and a half hours, which should dispose of the greater part of the debate. I agree with the noble Viscount that it is important that we should not have to sit too late on Tuesday.
VISCOUNT ALEXANDER OF HILLSBOROUGH: I am obliged. Perhaps the extra half-hour will conclude the debate.
LORD REA: My Lords, although all are not present now who will be speaking from these Benches, I am quite sure that they will agree with the noble Marquess the Leader of the House.
THE MARQUESS OF SALISBURY: I am grateful to the noble Lord, Lord Rea. I owe him an apology, because I did not have an opportunity of consulting him. This issue has arisen only in the last few minutes.

WALSALL CORPORATION BILL WEST BROMWICH CORPORATION BILL
Committed: the Committees to be proposed by the Committee of Selection.
RHYL URBAN DISTRICT COUNCIL BILL [H.L.]
The CHAIRMAN OF COMMITTEES The CHAIRMAN OF COMMITTEES informed the House that the opposition to the Bill was withdrawn: the Orders made on February 9 and April 18 last discharged, and Bill committed.
TEES CONSERVANCY BILL [H.L.]
Returned from the Commons agreed to with Amendments: the said Amendments considered and agreed to.

BARRY CORPORATION (BARRY HARBOUR) BILL
Returned from the Commons with the Amendment agreed to.
House adjourned at twenty-eight minutes before five o'clock.