HL Deb 09 July 1962 vol 242 cc5-132

2.45 p.m.

Further considered on Report (according to Order).

THE LORD CHANCELLOR (VISCOUNT KILMUIR) moved, after Clause 10 to insert the following new clause:

Development of land

.—(1) Subject to this section, each Board shall have power to develop their land in such manner as they may think fit.

(2) Each Board may, in particular, and subject to this section,—

  1. (a) retain any part of their land which is not required for the purposes of their business and develop it for use by other persons, and
  2. (b) where the use of their land for the purposes of their business can be combined with its use for other purposes, develop the land by constructing or adapting buildings thereon for use wholly or partly by other persons,
with a view to selling or otherwise disposing of any right or interest in the land or, as the case may be, the buildings or any part of the buildings, after the development is carried out.

(3) A Board shall not incur any substantial item of expenditure in developing their land for use for purposes which are not the purposes of their business without the consent of the Minister, and the Minister may from time to time give directions to the Boards indicating what is to be treated for the purposes of this section as a substantial item of expenditure.

(4) Where a Board propose under this section to develop any land for use otherwise than for the purposes of their business they shall have power, with the consent of the Minister, to acquire by agreement adjoining land for the purpose of developing it together with the other land, but the Minister shall not give his consent under this subsection unless it appears to him that the other land cannot be satisfactorily developed unless the adjoining and is acquired by the Board.

Except as provided by the foregoing provisions of this subsection, a Board shall not have power to acquire land for purposes which are not related to any of the activities of the Board other than the development of land.

The noble and learned Viscount said: My Lords, in rising to move this Amendment I should like to suggest to your Lordships a procedure which might be for the convenience of the House. The purpose of this Amendment alone is to put back into the Bill the clause on the development of land, formerly Clause 11, which was moved out of the Bill on Committee stage. Your Lordships will remember that my noble and learned friend Lord Conesford moved an Amendment dealing, if I may summarise it without objection from him, with the balance of office accommodation and residential use of land, and the points raised were underlined by noble Lords, including the noble Lord, Lord Silkin, who dealt with the question of the rights to compensation. The new clause which is the subject of the present Amendment is in identical terms with the former Clause 11 as it was amended by Government Amendments at Committee stage immediately prior to its deletion from the Bill. It therefore does nothing more than the former clause did to meet the points raised by noble Lords to whom I have referred and others.

The reason for this is that after full consideration of the points raised by my noble and learned friend Lord Conesford and the noble Lord, Lord Silkin, and others the Government have tabled Amendment No. 80H to introduce a completely new clause to follow Clause 84, which is designed to deal with the points raised by the noble Lords. It is not possible to do this by amendment to the former Clause 11 now to be reinserted, because the proposals which the Government are putting forward to meet the points raised in Committee are a substantive proposition modifying the application of the Town and Country Planning Acts in relation both to the British Transport Commission during the remainder of its life and the four new statutory Boards. It would not be appropriate, therefore, as part of the reinserted Clause 11. The new provision also places a completely new duty on the Commission and the four statutory Boards in relation to the use of their land in the administrative County of London. This also is not appropriate to Clause 11 but requires an entirely new clause which will govern both the exercise of the Boards' powers under the reinserted Clause 11 and the powers of the Commission under Clause 75 in so far as the development of their land in London is concerned.

It therefore occurred to me that it would really be for the convenience of the House if at this time I explained the purport of the new clause after Clause 84 and we had a general discussion on the point, not leaving out, if noble Lords thought so fit, the subject of Amendments which they desire to move. Of course, that does not prejudice their moving the Amendments later on. But this is a difficult problem, and I hope that the House might bear with me while I explain the Government's solution for it.


My Lords, perhaps the noble and learned Viscount will allow me, in disposing of this part of what he is saying, to say that that certainly would be agreeable to my noble friends and myself. There is only one question I should like to ask, and it is on procedure. There are a number of Amendments to the new clause after Clause 84. I have a number of Amendments which I myself should like to put down, and which I have been cogitating over during the week-end. I should hope that those Amendments and that new clause would not be taken to-day. Perhaps the noble and learned Viscount could give an assurance that, however rapidly we proceed to-day, we shall get only as far as this new clause and then we shall stop and go on to that on another day. That would be perfectly satisfactory.


My Lords, I think it would be a miracle if we got as far as Clause 84, and I have no difficulty in agreeing with what the noble Lord, Lord Silkin says.


Your Lordships will remember that the main point of criticism centred on the possible consequences of the development of office accommodation in London, and it was contended that these new powers would enable the Boards to develop considerable areas of their surplus land in London for office accommodation, so adding to traffic congestion and the problems of getting people to and from their work on public transport both in London and on the suburban roads and railways into London. The noble Lord, Lord Silkin, in supporting Lord Conesford's Amendment, made two main points: that there would be circumstances where the Commission or the new Boards would not require planning permission for alterations in existing buildings which would produce more office accommodation, and that in circumstances where they would require planning permission the refusal of such permission would probably involve the planning authority in paying heavy compensation, which might deter them from refusing permission for such office development.

My noble friend Lord Conesford, if I may put it shortly, recognised that this is really a planning matter, but he said that the circumstances were so important, and the problems raised so great, that he felt that he must deal with it on this Bill. On that I should like to make one point, because I think it is important, and we are considering the position of the Commission and the Boards. My noble friend made the point that Clause 11 of the Transport Bill confers new powers of land development on the Commission and the four statutory Boards. I think one ought to remember that, as regards that point, the new powers of land development which the former Clause 11 sought to give to the Commission and the new Boards would do no more than put them in the same general position as the other nationalised industries who have powers to develop their surplus land for purposes other than the purposes of their statutory undertaking. The Commission were deprived of this power by restrictions on their manufacturing powers which, incidentally and unwittingly, prohibited them from developing their land for lease or sale.

But on the second of my noble and learned friend's points (if I may say so, the more important one), I would ask your Lordships for a moment to look at what the new clause does. The clause is designed to meet, so far as practicable, the criticism made during the debate on the Committee stage, that the new powers of development to be given to the new Boards under that clause would enable them to develop considerable areas of surplus land in London as they think fit, and that although such development would be governed by the Town and Country Planning Acts, this would not, in the circumstances, be adequate to meet the situation, and, in particular, the Boards would be able to develop considerable new office accommodation in London, and so add to the present traffic congestion. As I have said, it was said that the Town and Country Planning Acts would not be sufficient safeguard because refusal of planning permission would in many instances entail the payment of compensation, and that would deter the planning authority from refusing permission to the Boards.

Subsection (1) of the new clause is designed to ensure that the Commission (for the period between the Royal Assent and vesting date) and, thereafter, the new Boards shall carry out full consultation with the London County Council (which, as your Lordships know, is the planning authority concerned), so as to produce proposals for the use of surplus land available for development under the powers to be given to the Commission and the new Boards under the Bill. I ask your Lordships to note that point because it is of great importance. They are placed under a clear and mandatory statutory duty, first of all to have consultation with the L.C.C., and then to make the proposals. In fact, discussions are already proceeding between the L.C.C. and the Commission for this purpose, with a view to producing agreed proposals for the use of the Commission's surplus land in London and its allocation between housing and other forms of development. This will enable the problem to be dealt with in a comprehensive way and also, as the new clause says, balanced proposals to emerge, rather than a piecemeal allocation.

That is the first stage. I think it is most important and an excellent thing, because here there is a large amount of land which may come under consideration. In a sense, it is really a smaller London Plan, which must be made for the 1,500 acres which we are considering. Therefore, we say first of all, that there must be consultation and there must be proposals; then the proposals have to be submitted for the approval of the Minister of Housing and Local Government, so that he can satisfy himself that they are consistent with proper planning and achieve a proper balance between housing and related amenities, on the one hand, and trade and business requirements (including office accommodation), on the other. Again I think your Lordships will agree that that is the right course. One of the rather rare qualities of this Amendment is that it is giving statutory form to what is actually happening at the present time through the good sense of the L.C.C. and the Commission.

Subsection (2), together with subsection (3), provides the sanction and the incentive for the Commission and the new Boards to consult the L.C.C. and formulate acceptable proposals for the use of their surplus land in London. Until they have done so, and the Minister has approved the proposals, they will not be eligible for compensation for refusal of planning permission, or for the attaching of conditions to a planning permission, in respect of any application to develop their land in London for office accommodation whether for their own purposes or not. The Minister's order is to be made by statutory instrument.

Subsection (3), in my view, should be an effective sanction, in that until proposals have been approved by the Minister of Housing and Local Government for the use of surplus land belonging to the Commission or the Boards in the County of London no compensation will be payable in respect of refusal of planning permission to develop office accommodation on that land. This will also remove the deterrent on the planning authority to the refusal of planning consent, which it was contended on the Committee stage would largely nullify the operation of planning control in certain circumstances.

I think your Lordships will agree that subsection (4) is sensible and fair. It provided that where by fire or other accident office accommodation owned by the Commission or the Boards has been destroyed refusal of planning permission to rebuild these offices should attract compensation where appropriate, notwithstanding that the proposals under subsection (1) may not, at the material time, have been approved. Subsection (5) deals with the point that until the Minister of Housing and Local Government has certified, under subsection (3), that he has approved proposals for the use of the Board's surplus land in London, submitted to him under subsection (1), there is to be no compensation for the refusal of planning permission to develop office accommodation on any of the land belonging to the Commission or the four Boards, whether for operational purposes or for sale or lease for use by other persons. This subsection therefore makes it clear that references in subsection (3) to compensation include references to compensation under the Fifth Schedule to the Town and Country Planning Act, 1947, to the development of operational land as well as, in subsection (3), to non-operational land.

If I might summarise the clause, it seeks to place a duty on the Commission and the new Boards to consult with the L.C.C. and submit to the Minister of Housing and Local Government proposals for the proper planning of the surplus land of the Commission (and the Boards as its successors) with a proper balance between new office and other commercial accommodation, on the one hand, and housing and related amenities, on the other. Until such proposals have been submitted and approved by the Minister, and he has so certified by a statutory instrument, the Commission and the new Boards are not to be eligible for compensation in the event of refusal or conditional grant of planning permission for any office development in the County of London.

The new clause is also designed to go some way to meeting Lord Silkin's points, particularly his second point, that compensation involved in the refusal of planning permission might deter the planning authority from refusing permission for office development on surplus land. The British Transport Commission and the new Boards would be unable to carry out any development without planning permission except in one minor class of case. Therefore—and I speak with great diffidence in face of a view expressed by the noble Lord, Lord Silkin, because of his infinite experience in this matter—I am in a dangerous position. The noble Lord will remember that it is exactly eighteen years since he and I first discussed in another place the question of planning applied to statutory undertakers, and I am in the danger that I might have some reprise of memory which will be misleading. However, that is my view.

If I might just remind him of the point that I have in mind, I said that all development by the British Transport Commission and their successors of land, whether required for operational purposes or not, requires an application for planning permission, unless it is a minor development of one particular kind. The noble Lord, Lord Silkin, will remember that he was empowered under Section 13 (1) of the Act of 1947 to make Orders which themselves grant permission for development. I think it was he who made an Order on May 8, 1950—I am not absolutely sure that was in his time. I do not think it is relevant to our present problem, but it is just worthy of mention that Class XVIIIA of the First Schedule to the Order grants permission for railway undertakers or their lessees to carry out on operational land development required in connection with the movement of traffic by rail. I wanted the noble Lord to know that it specifically excludes any office which is not Wholly within the interior of a railway station. I think therefore the noble Lord's fear on that point is dealt with.

In regard to his points on the question of compensation, again I have gone into them as carefully as I can. The noble Lord will remember he had some difficulty with regard to the Third Schedule. As I see it, subject to the noble Lord's view, the Third Schedule does not confer any right to make additions to an existing building. It merely establishes a notional existing use value for certain compensation purposes. Neither can an existing building which is used for some non-office purpose be put to use as an office, either with or without internal conversion, unless planning permission is first obtained, because that would be a "material change of use". As the noble Lord is aware, compensation following the refusal of planning permission can arise in a number of ways. I do not think he would feel that there was any materiality—and, therefore. I did not propose to trouble your Lordships with it—in the question of payment of the "unexpended balance of established development value." But I think the noble Lord had the point in mind that if a man is refused permission to increase the size of his building by 10 per cent. cubic capacity, he may claim compensation based on the depreciation in the value of his interest by reason of his refusal. That is Section 20 of, and the Third Schedule to, the 1947 Act. The operation of this right can, when it is combined with an application to rebuild the existing building, lead to compensation if permission is refused. I have in mind the question of new building techniques; but I would point out that this is not a problem in relation to new office building, but applies only to existing offices.

Finally, there is the case which is most likely to arise when the British Transport Commission wish to erect offices for commercial use on land which is surplus to their operational requirements. The owner, who is refused permission, may serve a notice on the local authority requiring them to purchase the land if he can demonstrate that in its existing state the land is incapable of reasonably beneficial use. But, of course, that can be defeated, as the noble Lord knows, by a permission to use for some purpose which confers beneficial use on the land; and compensation falls to be paid only if the value of the use permitted is less than the existing use of value of the land. I think the noble Lord will agree that it is to be expected that the greater part of the land which will be surplus to the operational requirements of the Commission will be open land, redundant sidings, et cetera, but there is no reason to suppose that this land will not generally attract a planning permission for some use, for example, housing, which will be more valuable than its existing use. Therefore, I think that point is met. I am sorry to deal with these matters at such length, but your Lordships raised some very interesting points during the Committee stage and I have tried to do my homework and come equipped to deal with them.

There are really three points which are raised on the Amendments. I am not going to deal with them at any length now because I am very anxious to hear what noble Lords say when they move their Amendments. I would make only one or two general points. The noble Lords, Lord Shepherd and Lord Lindgren, are anxious to apply this either to Manchester or to Birmingham specifically, or to give a power of general application. I should just like them to consider two points before they make up their minds how far they are going to take this.

The first is that the scale and mature of the problem of office development and public commuter transport in London and the London area are unique; no such problem arises in other large cities on anything like the scale of the London situation. During the debates the whole concentration of thought has been in regard to London. I should like to put this point, because I know that the noble Lords are very concerned with the position of nationalised industries. The reason why the Government decided to introduce the new clause to deal with this matter, was that it recognised that in London, and in our view only in London, circumstances arise which are unique—if I may use that word—and so special as to justify a highly discriminatory provision for the control of office development by the Commission and the Boards. Noble Lords realise that, by meeting them in this way, we are none the less discriminating against the Commission and the Boards, for the reason that there is a very great problem. I would ask noble Lords to consider (as they can see, there is no Party thought anywhere in my mind on this) whether it would not be better to confine that discrimination against the Boards to London, where there is this immense and special problem. I simply put that thought and, as I say, I will listen with great interest to what noble Lords say.

My noble and learned friend Lord Conesford has given this matter great attention, and he is worried about the wording of the clause. If your Lordships would be good enough to look at the clause, which occurs in Amendment No. 80H, I should like to point out the words which worry my noble and learned friend. They are to be found in subsection (2), three lines from the end, where it says at the time when the application is made". My noble and learned friend would prefer that it should be at the time when this Act is passed". The point which my noble and learned friend has in mind is that the Commission, or the Boards, might dispose of their land to a third party, and, therefore, it would no longer be their land; and the third party would come in and would not be subject to the same diminution of compensation. I have considered this point, I assure my noble and learned friend. He was good enough to come to see me about it, and we discussed it for nearly two hours. I have given it great thought over the weekend, and I cannot share my noble friend's difficulties. But, again, may I just give the broad reasons for your Lordships to consider?

The new clause imposes on the Commission and the new Boards a duty which comes into effect the moment this part of the Bill comes into force and will apply to all the surplus land owned by the Commission at this time. As I told your Lordships, discussions are already proceeding between the Commission and the London County Council about the use of the Commission's surplus land in London. The Commission and the new Boards will be public bodies, and I think it would be wrong to assume that they would stultify their statutory duty. If they were to attempt to do so, the result of course, would be to prejudice not only the discussions with the L.C.C., but their chance of getting the permission of the Minister.

Of course, the Commission and the Boards would find it difficult to dispose of land without planning permission for its development, and the price they would get would not be very attractive. But it seemed to me (and I put this, because I should very much like, in due course, to hear my noble and learned friend's reply) that if the Commission or the Boards—and this is the hypothesis, as I understand it—at the same time, and in respect of the same land, first of all consult the L.C.C. and make proposals, and then sell off part of the land, ex hypothesi covered by the proposals, for living accommodation about which the question arises, the proposals will not then be consonant with the need for a proper balance.

If your Lordships will look at subsection (1), you will see that the second duty of the Commission and the Boards is to make proposals with regard to the use of that land in a manner which is consistent with proper planning and which, in particular, is consistent with the need for keeping a proper balance in the use of their land as between office accommodation and the use for provision of new living accommodation. If the proposals contained a proper balance, as they must, then, if the Commission or the Boards were to sell off part of the land, they would have broken their statutory duty under the clause. They would at the worst be subject, I should have thought, to legal action; and at the best the Minister (because this is being done before the Minister has approved) will deal with the matter in giving his approval; and, of course, until the Minister has approved they can get no compensation for land in their possession if planning permission is refused.

My noble and learned friend's second point—I am putting it very generally—is that the situation under the approval of the Minister should continue for ever. My Lords, I respectfully submit that that would be too rigid in its effect. There might be changes in circumstances which would make it desirable and acceptable on planning grounds that there should be development of land belonging to the Commission or the new Boards otherwise than in accordance with the proposals already approved. In these circumstances, if the Commission or the Boards apply for planning permission for such development, and the planning permission is granted subject to conditions which have nothing to do with the original proposals and are not designed to bring the application nearer to the proposals, the Boards will still be denied compensation. That again seems to me to be a rigidity which would be unfair to the Boards.

My Lords, I could not apologise more to the House for taking up so much time, but your Lordships showed such great concern with this problem that I thought it was only right that I should try to deal with it to-day. I have tried to keep my arguments to the general points. At the moment, I am asking your Lordships to replace the old Clause 11; and then we will deal with the problems raised by the new clause, with which I have dealt. My Lords, I beg to move.

Amendment moved— After Clause 10, insert the said new clause.—(The Lord Chancellor.)

3.21 p.m.


My Lords, I should like first of all to thank the noble and learned Viscount, not for the first time, for his clear exposition of a most difficult new clause. I am not referring to Clause 10, which is an the same terms as the original; but, in fact, the noble and learned Viscount has been explaining the new clause after Clause 84, which is the one designed to meet the discussions which have taken place. We are very grateful to him for having taken so much trouble and sacrificed so much of his well-needed weekend rest in going into this. If it is any consolation to him, I can assure him that I have done the same. It is a very difficult new provision, and I must confess that even now I am not fully clear as to what are the consequences of it. I shall refer to some of my apprehensions in a moment, but I should like straight away to thank the Government for the efforts that they have made to meet the criticisms expressed in this House on the original provisions. Whether we are wholly satisfied or not will emerge. I myself think-that perhaps the Government have not gone far enough; but I do pay tribute to the Government for the great trouble they have taken in going as far as they have gone, and I am sure they have done what they think is right in the circumstances.

Perhaps I should best help the House if I tried to go through the matters which are not clearly explained, as I see it, in this new clause after Clause 84. As the noble and learned Viscount has told us, the Commission and the Boards—I will refer to them as "the Commission" for brevity—have imposed upon them the duty to prepare a scheme in respect of their surplus properties in London. Now it is not clear, first of all. Whether it is one scheme or a number of schemes. They have, as the noble and learned Viscount said, 1,500 acres. I did not think it was as much as that; but. whatever the area is, it is a pretty large area, and it is difficult to visualise a scheme which is a balanced scheme and which provides housing, and so on, without its being one comprehensive scheme. On the other hand, that is a pretty formidable task: to prepare one scheme for the whole area; and I should be grateful if the noble and learned Viscount would explain to the House how he visualises that this will come about. Are the discussions, to put it in another form, taking place regionally, or are they all-embracing discussions for the whole of the land in the County of London? They will also have to take into account what are the residential divisions even on the borders of London.

But supposing that, at the end of the day (and it may well take a long time, because there will have to be discussions with the London County Council, and be consideration by the Ministry of Housing and Local Government, no doubt in collaboration with the Ministry of Transport), a scheme is put forward, will the public have any opportunity of considering it? The clause makes no provision, as I read it, for anything of the kind. Indeed, the public will know nothing about this scheme; and in due course, as the clause stands, it will be presented as the scheme on which the Commission will be entitled to deal with their land.

The next question is: once this is the scheme, will the Commission require planning permission for any of the land they wish to develop, or can we take it that planning permission will no longer be required and will be all governed by the scheme itself? I would not express any opinion as to whether or not planning permission should be required, but if planning permission is required, in spite of the fact that the scheme is there, is it quite clear from the wording of this clause that, if permission is refused in respect of any application, the refusal will not involve compensation?

If the Commission want to develop a piece of land which is not in accordance with the scheme, I presume that they will have two courses open to them: they can take a chance and apply for planning permission, although it is contrary to the scheme; or they can dispose of the land to a developer, subject to his obtaining planning permission. If they do dispose of it to a developer, subject to his obtaining planning permission, then is it clear that the developer will not be entitled to compensation? If, on the other hand, they wished to deviate from this scheme, the Commission could apply for permission to put forward a new scheme and get the Ministry's authority for that; but that is not provided for in the clause. As I read the clause as it stands, once the scheme has been made by the Ministry, that is the scheme, and there is no provision for any alteration. These are some of the doubts I have as to what is the position.

Furthermore, although under the new clause it is quite clear that if, before the scheme is approved, an application is made for planning permission and refused, there will be no compensation, what is the position as regards the scheme itself? The scheme will certainly take into account the fact that some land which would normally have been used for other valuable accommodation will not be so used. The clause is silent on the question of liability as to compensation. Suppose, for the sake of argument, to take an absurd case, under the scheme which is finally agreed, land over Euston Station is to be used for housing purposes. Will the Commission be entitled to compensation in respect of that, or is it understood that no compensation is to be payable in respect of any development which conforms to the scheme itself? I ask these questions because the clause is quite silent about the matter, and it is very difficult to follow what is the position.

I think that what is fairly clear, subject to the noble and learned Viscount's Amendment, is what happens before the scheme is approved; I think we understand that fairly clearly. But I am not clear what are the implications of the scheme in the various respects which I have put forward, and I am certainly not clear what happens after the scheme is made, or whether the public will have any opportunity of commenting on the scheme, of criticising it, and so on. I hope that the noble and learned Viscount can give some answers to these questions.

I want now to deal with some of the points which have been referred to on the merits. The noble and learned Viscount was quite right in saying that virtually the whole of the debate which took place in Committee on Clause 11 referred to the evil of offices in London. That is perfectly true. I would concede also, as the noble and learned Viscount said, that this is a problem which is peculiar to London. I myself have no evidence that it is in any way acute in any other of the large towns, but we should like to explore that and also discover how much surplus land the Commission have available in these large towns. It may be that it is an acute problem. There is not very much surplus land in those towns. I think we ought to know those things before we dispose of the Amendments which have been put down, because they are material. If it should turn out that the Commission have large areas of land in these big towns, and that it is a great problem there, then I think there is a case for dealing with these large towns in the same way as we are dealing with London.

I quite agree with the noble and learned Viscount that there is an argument, and it will be put forward, for treating the land of other nationalised undertakings in the same way; I can see that. But we are dealing with this on the basis that it is a special and acute problem of a gravity and of a size which is quite different in kind from any other; and if the position was that the electricity undertaking equally had enormous areas of land in London or in any of the large towns which was surplus to their requirements and available for use as offices, we should, of course, have to deal with them in exactly the same way. But I understand that that is not the case, and that is the reason for the apparent discrimination against land of the Commission.

So far as the London County Council are concerned, they take the view that, although the question of office accommodation is an acute one, and is very largely responsible for the traffic difficulties with which we are faced in Lon don, offices are not the only problem. They have been faced for a great many years with the problem of industrial and commercial premises coming to London and creating the same kind of difficulties as are being created in the case of offices—perhaps not so acutely, but it is a problem. They have been engaged for many years in trying to decentralise the commercial and industrial premises by way of expanded towns, and so on, but without very great success. They feel that we ought to be dealing with that problem as well, and I propose at the appropriate time to put down an Amendment which would extend this treatment of office buildings to industrial and commercial premises, so that—


My Lords, perhaps I might interupt the noble Lord and point out that I already have an Amendment down to that effect. Amendment No. 80K would extend the operation of this new clause to industrial as well as commercial premises.


Obviously great minds think alike. I will have a look at that to see whether I can support the noble Lord. There are a number of other things, but I do not think I will trouble the House with them at this moment. They are Amendments which I propose to put down, but I think it would be more convenient if one dealt with them in the course of the discussion on the Amendments. They are not major questions of principle. I think I have dealt with the major questions of principle to which this new clause gives rise, and the doubts and lack of clarity, so far as my reading of them goes, which I find. I should be grateful if in due course the noble and learned Viscount could satisfy more of my doubts, and clear up some of the difficulties of the clause itself.

3.36 p.m.


My Lords, may I at the outset join the noble Lord, Lord Silkin, in expressing gratitude to the Government for meeting, to a consider able extent, the points which were, I think, common to all those who sup ported my Amendment, which was carried by a substantial majority on May 29; and, in particular, may I thank my noble and learned friend on the Wool sack, both for his exposition to-day and for the trouble he has taken in ascertaining my views before this debate. My Lords, none of those who supported my Amendment which led at one remove to the deletion of the original Clause 11, and no one in any part of the House (or the Committee, as it then was,) suggested that anything we could do in this Bill would solve the whole problem presented by excessive office development in the County of London. What we all thought was that it was appropriate that we should take such steps in the present Bill as would prevent making the problem utterly insoluble and the difficulties very much worse. That was the object with which I carried my Amendment, and that was the object which the noble Lord, Lord Silkin, had in moving to leave out the clause. As the noble Lord, Lord Silkin, has indicated, the new clause which is set down as Amendment No. 80H goes some way to meeting the problem, but has, I think, a number of obscurities. Some of the points I have in mind are the same as the noble Lord, Lord Silkin, has in mind, though I think that the answers to some of the questions he put are fairly plain. The details of the new clause which is the subject of Amendment No. 80H, and the Amendments which have been set down both on the other side of the House and by myself and my noble friend Lord Molson, will all be discussed when we reach that clause; but for the reasons given by my noble and learned friend on the Woolsack and the noble Lord, Lord Silkin, it is obviously convenient that the general lines should be indicated in the discussion which is now taking place.

So many noble Lords have asked me in the interval between the carrying of my original Amendment and to-day what I thought of the new clause that I should like to indicate to my noble and learned friend on the Woolsack the two main doubts I have about it. I am most anxious that the purpose which the Government have in mind in this new clause should not be defeated because we fail to provide for certain eventualities which certainly can happen and which I think are quite likely to happen. The noble Lord, Lord Silkin, referred in many passages of his speech to the "scheme". That is quite a convenient way of referring to it, but the word "scheme" does not occur at all in the new clause. What does occur are "proposals", which the Minister of Housing and Local Government eventually approves, but those proposals never have any legal effect whatsoever under the town and country planning legislation. They serve only to furnish a date.

If the new clause is examined, it will be seen that it consists of three main parts. The first part is that which is contained in subsection (1). I do not think that I have any quarrel with what my noble and learned friend on the Woolsack said about this subsection. Subsections (2) and (3) seem to me to provide the loopholes against which my Amendments are directed, Amendments which were dealt with briefly by my noble and learned friend on the Woolsack. In some ways it would be more convenient to deal with the second of my Amendments first; they are closely related. But let me make it clear that the period about which I am most concerned as I think is also the noble Lord, Lord Silkin, is the period after the approval of the proposals by the Minister of Housing and Local Government. I do not go quite so far as my noble and learned friend on the Woolsack in thinking that any alienation of land before the date of approval by the Minister would necessarily amount to a legal impropriety. If the Bill leaves it technically possible and legal, one could not say that. But I agree with my noble and learned friend on the Woolsack that it would be very unlikely.

What I fear, though, is that at a time subsequent to the approval of the proposals by the Minister of Housing and Local Government, somebody might propose a development which would not be in accordance with the proposals approved by the Minister and which would not be desirable in the public interest. If that happened, I believe that it is the almost unanimous wish of this House that a proposal that was contrary both to the public interest and to the proposals approved by the Minister could be rejected without involving the planning authority in a liability to compensation; I believe that that is the view of this House. There is a scheme under which there is temporary protection against such a liability to compensation in the period before the Minister has approved the proposals, but once he has approved them, then the scheme of this clause could be defeated in one of two ways.

In the event of a sale by one of these Boards, the purchaser would not be within the scheme of subsections (2) and (3) because the land would not belong to the Commission or Board at the time the application for development was made. The other difficulty is this. The limitation of compensation under subsection (3) is most important. What is the justification for confining that limitation of the right to compensation to the period before the proposals are approved? I think that the only justification for that limitation is the idea, which may well be conveyed to the ordinary layman on reading this proposed new clause, that subsequent applications to develop the land will be in accordance with the proposals approved by the Minister. But they may not be.

When my noble and learned friend on the Woolsack dealt with this Amendment in his Speech, he said that my second Amendment goes too far, because it may be desirable at some future date for the Minister to vary the proposals he has approved. Of course it may, and in that case a new situation would arise. But what I am suggesting to the House is this. On the supposition that the Minister does not change his mind, but thinks some years hence that the proposals he approved, at whatever date, remain good and sound proposals, why should an application to develop the land which conflicted with the proposals so approved carry a right to compensation? This is land which belongs in effect to the nation, for which the nation has in fact already paid. The body which will be developing it is a body which, by this very measure, has been let off a great part of its debt. Why should it be compensated at this later stage for a refusal of permission to develop its land, which, ex hypothesi, will not be in the public interest?

When he approves the proposals drawn up under subsection (1), the Minister will consider the public interest and the balance between the various uses of the land in all their aspects. I suggest that whoever makes an application for the development of this land, at whatever time he makes it, if the application conflicts with the proposals approved by the Minister, that application should not carry the right of compensation. I should have thought that the answer to the question posed by the noble Lord, Lord Silkin, when he referred to the proposals as "a scheme" was clear. He asked whether, once the scheme had been approved, planning consent would be required. I realise that the noble Lord, Lord Silkin, will want an authoritative answer by a Government spokesman, but I would suggest that the answer to that question is clearly, Yes. Approval of the proposals will in no sense affect the need to obtain planning consent. Burt, having said that, I would add that I share the doubts expressed by the noble Lord, Lord Silkin, on the effect of the clause as it stands on subsequent claims for compensation. I think the noble Lord had some doubts even at an earlier stage, and I have not thought out the answer to one of the points he raised.

But on his main point, about the right to compensation at a later stage if an application to develop land was put forward which conflicted with the proposals approved by the Minister, I share his fears.


My Lords, in case I did not make myself clear, I am also uncertain what is the position even if the application does conform to the proposal. If an application is made in accordance with the proposal and is refused, is compensation then payable?


I am obliged to the noble Lord for that intervention, because there is some obscurity about that; and I, too, hope that we shall have the answer to it, because it is a point which I admit is not dealt with by the Amendments that I have put down. In the main body of what I have said I thought it best to confine myself to the chief doubts that I feel about the new clause. It is not a disapproval of the Government's intention; it is a criticism of the clause as drafted, which seems to me to leave at least a couple of dangerous loopholes. My correspondence, even since I had the pleasure of talking to my noble and learned friend on the Woolsack, shows that some of my fears in this matter are shared by people much more technically competent and experienced in this branch of the law than I am. I repeat my thanks to the Government for the new clause, and to my noble and learned friend for his exposition of it. I thought it might assist if I indicated to-day the two doubts which have prompted the Amendments that I have put down on the Marshalled List.

3.53 p.m.


My Lords, I rise with some hesitation, following my noble friend Lord Silkin and the noble Lord, Lord Conesford, who are experts in this matter, but I do so for two reasons. First of all, I spoke on the Committee stage and suggested to my noble friends that we should support the noble Lord, Lord Conesford, in his Amendment. Since we did that, with some success, I have received some correspondence, all of it critical, that we on this side of the Committee had assisted in an Amendment which put a State Board at a disadvantage to private enterprise; suggesting that we were putting a shackle upon a State enterprise when we appeared to leave it free for the private operator to develop his property in London. But I made it perfectly clear then, and I repeat this afternoon, that we supported the noble Lord's Amendment in a spirit of protest at what appeared to be the unrestricted and continual growth of office population in London, with the resulting hardship to those who work in London and, as I said in my speech on the Committee stage, the additional increase to the general overheads of industry in the country.

I agree with my noble friend Lord Silkin and the noble Lord, Lord Conesford, in expressing appreciation of the ingenuity of the Government in producing this series of Amendments—and I think a great deal of ingenuity was used to produce them. But my noble friend Lord Lindgren and I have put down an Amendment to the Amendment, the purpose of which is to extend this new clause to other areas in the United Kingdom. It is quite true that on the Committee stage most of the attention was directed to the problem of office building. But the noble and learned Viscount on the Woolsack will appreciate that, prior to Lord Conesford's Amendment, my noble friend Lord Champion moved an Amendment that, before the Boards disposed of their property, there should be consultation with the highway authorities and also with the other Boards. What my noble friend had in mind—and we agreed with him—was that, since much of the property of the Railway Boards was central in many of our main cities, this property not only was valuable in terms of pounds, shillings and pence but constituted an important essential point in any development of a town or city. Therefore what we wished was that, when this property was to be disposed of, before the Boards came to their own decision about how best to develop the property, they should have some consultation with the local planning authority to find out how the property could best be developed for the general community. That is the general basis of the Amendment to be moved later by my noble friend Lord Lindgren.

Perhaps the noble and learned Viscount would give consideration to the wording of Amendment No. 80H where it relates to office accommodation, on the one hand, and living accommodation, on the other, to see whether it is possible to find some suitable words that would make it quite clear that there are other matters to be considered when considering good planning. I have in mind, for instance, road development in the central parts of our cities; possibly the question of car parks, or open spaces in the form of gardens—which I might call community matters: not merely the question of housing, on the one side, and offices, on the other, but what is the community interest.

I remember that noble Lords on the Front Bench opposite have often said, that they have tried to put specific words into a Bill; but when specific words are included they seem to push outside some factors which are of equal importance but which could hardly, in justice, all be put into the Bill. Indeed, one might say that that is a criticism of the wording of the Government's Amendment. I think there are many factors in good planning in our cities other than those concerned with office accommodation and housing. Certainly we need more open spaces, central circuits for traffic, suitable places for parking cars and the like. Therefore, I hope that the noble and learned Viscount on the Woolsack, when be replies, will be able to give us an assurance that, while we have the words "office", on the one side, and "housing", on the other, these other matters will be borne fully in mind.

4.0 p.m.


My Lords, may I say one word in support of one remark made by the noble Lord, Lord Shepherd? I regret that in this new clause no power is given to the Minister to control land Which is suitable, and probably required, for roads and car parking. It is particularly important that he should have some power of this kind, because if you put up a new building and then want to have a road in its direction—it may be the most suitable line for the road—normally you cannot go to the expense of pulling the building down. In those circumstances Where railways are getting rid of surplus land, it may well be the cheapest land for the Ministry of Transport to acquire for building their road. This is particularly the case Where the railway is giving up a line through the urban area, and is selling that particular land because it is no longer required by the railway. That site will probably be the most suitable for a new road. On the other hand, if you wish to erect buildings on land when it is required for a road, so far as I can see the Minister has no power to stop it. In so far as planning consists of things like roads as well as buildings, I hope the noble and learned Viscount will look at this clause again to see whether some Amendment cannot be put in, even at the next stage of the Bill, giving the Minister power to control the disposal of land Where it is suitable for roads, parking spaces and communications generally.


My Lords, at the Committee stage of this Bill the noble Lord, Lord Silkin, and I moved, perhaps for different reasons, to omit the land clause. In the event, our Amendments were swamped by that of my noble friend Lord Conesford, which I, of course, supported. His was the more local interest. My intention had been to draw attention to the danger that the railways would hoard land in the belief, perhaps quite correct, that over the years land tends to increase in value and that if they would treat it as they should, the creditors—that is, we, the British people—should descend and strip them of their land at the earliest possible moment and sell it in reduction of their losses.

I should like to have seen something put in the new clause to encourage the railways in their belief that they should get rid of their land as quickly as they can. There is nothing to that effect in the clause, but I presume that Her Majesty's Government are relying upon administrative action which the Minister can take, presumably under Clause 26 (1). I hope the Minister will not hesitate to take this action in order that we, the British people and taxpayers, shall receive as quickly as possible some recoupment of the vast sums of money we have put up to keep the railways afloat. Incidentally, I hope that Ministers of other Departments will be equally vigilant, because they all own a great deal of surplus land.


My Lords, I was not present during the debate on the Amendment moved by the noble Lord, Lord Conesford, towards the end of May. I have listened to this discussion with tremendous interest. As my noble friend Lord Shepherd has said, when experts on planning such as the noble Lord, Lord Conesford, and my noble friend Lord Silkin are present one hesitates to speak. I have divided loyalty, loyalty to local government and also some affection for transport and the British Transport Commission. I think it is very bad legislation if, in a Transport Bill, we try to deal with planning. Planning is a matter for a planning Act. There is nothing which the noble Lord, Lord Conesford, has said to-day which does not apply to any other undertaking, or any other landlord. Why should we start to deal with planning on the basis of the British Transport Commission and not on the general basis of landlord or land owner?

The question of building car parks was referred to. Of course, under existing legislation a planning authority has the right to require certain restrictions in regard to circulating areas, the provision of car parks and the rest. I would agree that that is not adequate, but why should the British Transport Commission be penalised to an extent which no noble Lord opposite would be prepared to extend to private development? If it is a good thing to place the responsibility on a public authority such as the Transport Commission, it is equally good for any landowner. Noble Lords opposite have said the country acquired this land and paid a subsidy. When title to land ownership in this country is gone into, in very many instances the original ownership is quite questionable. Reference has been made to the question of compensation. I would agree entirely, but will the noble Lord, Lord Conesford, when he comes to deal with his Amendment deal with this point? My noble friend Lord Silkin, in his 1947 Act, was the first person to tackle the basis of planning, and you cannot deal with planning unless you deal with compensation and betterment. The reason why the landlords of this country objected to the 1947 Act was that it hit them where it hurt—and it hurt them in their pockets—to prevent them from keeping the accretion of values for which they had done nothing.

The noble Lord, Lord Hawke, asked why the British Transport Commission or a public authority should hold land and gain an increase in value arising from the rise in prices. What is every other landowner doing in this country? If it is not good enough for the British Transport Commission it is not good enough for any other landlord. Therefore, while I agree with every sentiment to which the noble Lord, Lord Conesford, has referred, and equally with the noble Lord, Lord Hawke, I am going to say, "Be honest. If you are going to apply those principles to the British Transport Commission, apply them to every other landlord in this country, and I will support you".


My Lords, may I first express my gratitude for the reception which the House has given to the general effect of the clause? I should like to try to deal with the questions which have been asked me as well as I can at the present moment. The noble Lord, Lord Silkin, asked me about the scheme and the collective aspect of the proposals—because the word is, as was pointed out, "proposals". But I want to be quite clear that the concept is that there should be one comprehensive scheme or set of proposals dealing with all the land which is surplus or about to become surplus so far as can be reasonably foreseen. That will be large enough to set the pattern for the way in which the surplus land of the Commission in London will be dealt with. I should like to say to the noble Lord that, although that may be quite a big operation, we are convinced that it is quite manageable, and the discussions between the London County Council and the British Transport Commission are at present well under way. I do not want, and I am sure the noble Lord will not want, the idea to be lost of having a good, general pattern which will be valuable from every point of view.

May I take the noble Lord's third question, which was: will the Commission and the Boards still need planning permission to develop land in the scheme? The answer is "Yes"; and the new clause in no way takes the place of the Planning Act and the need to get planning permission. That was the view modestly put forward by my noble and learned friend Lord Conesford, and that is the view which I think is right. I think that, in a sense, answers Lord Silkin's second question: and I will take them in that order. He asked me, will the public have an opportunity to comment on the proposals? The answer is "No", because, as I said, the proposals do not prejudice and take the place of normal planning control and separate applications for planning permission for particular projects. Therefore, the public will have the right that it has under the Planning Acts of dealing with the particular projects.

The noble Lord then asked me, would persons to whom the Commission sold land covered by the proposals get compensation if they were refused planning permission? The answer to that is "Yes"; the clause applies only to the Commission and the new Boards. But, of course, it is subject to the point which I put earlier: that the Commission and the Boards are subject to a statutory duty, first of all to consult and then to submit their proposals for the approval of the Minister. In these circumstances, the conception that they would put forward the proposals, on the one hand after consultation, and then sell off, is difficult, first of all from the point of view of the conception of these Boards—both the noble Lords, Lord Shepherd and Lord Lindgren, I think, rather suggested that we should have in mind the special position of these Boards. It would also, as I put forward in my earlier speech, be a hopeless thing to do, because if you put forward proposals which represent the true balance between housing and commercial and then say, "But since then I have sold that off", clearly the Minister is going to say, "This no longer represents the true balance. On your own showing you said that the true balance was in your original proposal, and now you are taking something out of the use for housing sites"—it would not pay to take some out of the other sites—"You have broken the balance; you have not carried out your statutory duty, and you will have to begin again." You would not get approval from the Minister, and until you did get approval you would be in the difficulty which has been propounded.

The next question was, would the Commission and the new Boards get compensation for refusal of planning consent? Only after the proposals under subsection (1) have been approved and certified by the Minister under subsection (2). I think that is the answer to that point. The noble Lord, Lord Silkin, asked as to the compensation for compliance by the Commission and the Boards with the proposals. I ask the noble Lord to note this—and this is really the point which my noble and learned friend Lord Conesford is troubled about—that the new Clause has no permanent effect on the compensation rights of anyone. If Boards are asked to agree that surplus lands with valuable existing use rights—for example, for some industrial use—should be earmarked for less valuable use, such as housing, they would be able to sell the land to the local authority at its notional market value, which would include the value of the existing use rights. But what they will not be able to do, if complying with the proposals, is to claim from the London County Council or the Minister planning permission which would enable them to sell the land for more valuable use, including the existing use.


My Lords, before the noble and learned Viscount leaves that point, may I say that I have been wondering what is the effect of the approval of the proposal? Does it mean that once these proposals have been approved they really settle what is the proper use of the land which is surplus to the requirements of the Commission, and that any other use will not be appropriate?


That is so. They settle the proper use and, of course, they also settle the date, because the date of approval is the end date of the operation of Clause 3; so they fix the time up to which compensation will not be payable.

My noble friend Lord Conesford put his two points, if he will allow me to say so, with great clarity and moderation. I still feel worried about my noble and learned friend's second point—I am dealing with it in his order—for these reasons: that its effect is, if I may take an example, that the Commission or the Boards might put forward in their proposals submitted to the Ministry of Housing and Local Government under subsection (1) plans for certain areas of land to be devoted to housing. The Minister might approve the proposals on that undertaking and make his certifying order under subsection (2). Thereafter the Commission might change their minds and apply for planning permission to build offices on that land, and, in the event of refusal, claim compensation. In other words, my noble and learned friend might claim that the clause, as drafted, places a duty on the Commission and the new Boards to produce proposals for proper planning and development of their surplus land in London but, having done so to the satisfaction of the Minister, there is no sanction by way of denial of compensation to ensure that these proposals will be carried out in the future.

I really ask your Lordships to consider this point, because I have tried to myself, and I feel that that would be too rigid. There may well be changes in circumstances over a period of time which would make it desirable and acceptable on planning grounds for development of land belonging to the Commission or the new Boards otherwise than in accordance with proposals already approved under subsection (1). As I said to your Lordships before, in these circumstances, if a Board applied for planning permission for such a development and the planning permission was granted subject to a condition which had nothing to do with the original proposals under subsection (1) and a condition which was not designed to bring the application nearer to those proposals, the Board would still be denied compensation. Is that fair?, I ask your Lordships. That is the problem I want your Lordships to put to yourselves. I put it interrogatively because I think it is an important question. Is it fair that these Boards, which are public Boards, for the whole of the future should go on and be subject to an attachment of condition which has nothing to do with the distribution, and not be entitled to compensation? I respectfully suggest that that is going too far, and all I do at the moment is to ask noble Lords to consider it.


My Lords, I am most grateful to my noble and learned friend for yielding. He says it has nothing to do with the proper distribution; but of course it might have everything to do with the proper distribution. The application to use this land for a purpose which was not in the proposals approved by the Minister might still, in the Minister's view, conflict with the proper distribution; yet, under the clause as drafted (I think I am right), they could ignore the proposals approved by the Minister and still get compensation.


Surely there are two answers to that. The first is that it does, as I say, impose a rigidity for a long time. The second is this—again I put it interrogatively—is my noble friend putting the onus the right way round? If the clause did not allow for the Board to get compensation in the case that I gave, where it had nothing to do with the original proposals and where it was not designed to bring it nearer to the original proposals, is it fair that the Board should not get compensation? If your provision does not allow the Board to get compensation then you are, I think, producing an injustice. I assure my noble and learned friend that I put it completely inoffensively; I am not sure it is right to put injustices on the Boards because of their history in the past or their position as nationalised Boards. After all, my noble friend and I took part in all these discussions when we were working out our philosophy with regard to these matters, and we accepted, although we disagreed with nationalisation in certain cases, that when you had established a nationalised Board you had to give it a fair crack of the whip in the country. That was our general philosophy at the time. I feel myself that this will have the result of imposing an injustice.


My Lords, I hope the noble and learned Viscount will feel it convenient to deal with this matter by interrogation; it will save time in the long run. I do not think he has entirely addressed himself to the point the noble Lord, Lord Conesford, just made—at any rate, not to my satisfaction. Suppose after the proposals have been approved, say years after—and nobody wants to impose rigidity; I agree with the noble and learned Viscount—the Transport Commission then feel that they would like to put forward some variation in the proposals because they think the time is ripe and circumstances have changed, ought they not to apply for a modification of the scheme? Is not that the right way to do it? If, in fact, they take the view that this will not interfere with the balance, but in fact it will interfere with the balance laid down in this clause, there would appear to be no way by which that could be decided. I should have thought they ought not to be the judges of whether it would interfere with the balance or not. My real question is: is not the best way of dealing with it to get a modification of the scheme?


At the moment I am not attracted by a permanent scheme. This is really placing a restriction on the Commission and the Boards in order to deal with a special and urgent social problem. As the noble Lord, Lord Shepherd said, that is the reason he invited his noble friends to support him, because there was an urgent social problem. We believe the way to deal with that urgent social problem is to get first of all consultation, then proposals and then proposals agreed. But after you have done that, first of all, as I say, you may have a variation. There are two points. You may have a variation of the original scheme, and there the Minister may, for reasons good to him, not think that it is right to agree to it. On the other hand, it is almost impossible five years ahead, let alone seven years ahead, to say what problems will arise; and if they put forward a variation at that time in the circumstances of that day, is it right that they should be deprived of the compensation? That is the first point. The second point is, as I have said, that the conditions which the Minister may attach may have nothing to do with the decision that was come to on subsection (1) at all; he may be attaching quite different conditions. In these circumstances again, why should the Board be deprived of compensation when the conditions are not related to the original split up of the land? These are the difficulties that I see.

On the other point, my noble and learned friend's first point originally, I would say that I have tried to work that out. I think the possibility—may I put it as high as that?—of, the Commission's or the Boards' selling off and therefore letting someone be outside the provisions of the clause when they themselves are under a statutory duty to put forward a balanced view is one of those nagging problems. I have tried to see my noble friend's difficulties in every successive six hours of this week-end. I will consider it again. I am still unconvinced, but I will have another try.

May I deal with this further point? The noble Lord, Lord Shepherd, asked for additional words in the new clause to indicate the other amenities. The noble Lord will see that we have put in new living accommodation (with the amenities required by a resident community)". What I had mainly in mind was open spaces. Certainly it will include that, and I should have thought would have included a wide scope of amenities. I should like to read the noble Lord's speech carefully, but I should have thought it would cover his point.


My Lords, I am most grateful. The wording here is: amenities required by a resident community". I should have thought those were amenities recognised and required for those Who are living in the immediate neighbourhood. Certainly open spaces would apply to them. But, just like the noble Lord opposite, we have thought about road development, proper flyovers and that type of development which, not in the immediate future but possibly in a year or two must always be taken into account by the highway authority in catering for garages and the like. I should not have thought that that would come within the definition of "amenities of a resident community". I should be most grateful if the noble and learned Viscount would consider this, because I think the balance here is concerned with purely office and living accommodation. I should have thought that we ought not to exclude from this the long-term requirements of transport and parking.


My Lords, I am grateful to the noble Lord. I certainly took the wider view. I should like to have a look at it. I should have thought that it included open spaces, community centres and a proper scheme of roads. However, there is no difference between us in what we want in that regard. I think that roughly my noble friend Lord Hawke asked, "Will they get on with getting rid of the land?" I said earlier on in my reply-that the matter was well under way. I do not think he need have fears in this regard because, although we are dealing with a great social problem, we also have in mind the position of the Commission and then the Boards, who will be anxious to do it.

The noble Lord, Lord Lindgren, gave us a warning with regard to the treatment of the Commission and the Boards, as opposed to others in a private capacity. I think we ought to have in mind, as I said earlier on, that it was only by a mischance that the powers of land development which the old Clause 11 sought to give to the Commission and the new Boards did not come into being. As I said, these powers would do no more than put them in the same general position as the other nationalised industries, with power to develop their surplus land other than for the purpose of their undertaking. The Commission were deprived of this power by restrictions on their manufacturing powers which, incidentally and unwittingly, prohibited them from developing their land for lease or sale. It was only by a side wind some fifteen years or so ago that they did not have the power. As they have not the power, your Lordships must look at the position as it exists. I ask your Lordships to remember this point: here we are dealing with a Board who, by mischance, got into this position; and while we are prepared and are all anxious to deal with a social problem, we ought not to allow that to let us either impute motives, or say or do anything else derogatory to the Board because they have to come to Parliament to get into a position which every other Board has.

I have tried to state the matter with great moderation because I am sure we are all anxious that we should deal with it on its merits. I will look into the points, but I hope that the House will feel that we have, tried to meet the spirit of the House as a whole, and will deal with the Amendments in that way when we come to them. In the meantime, I am moving the limited Amendment, this new clause.

On Question, Amendment agreed to.

Clause 11:

Provisions concerning all the Boards Pipe-lines


(2) The Boards shall not have power to acquire land for the purpose of constructing pipe-lines except—

  1. (a) where the pipe-line is or is to be mainly on land belonging to the Boards and acquired for other purposes, or
  2. (b) where the pipe-line is required for the purposes of the business of the Board other than the operation of pipe-lines.

(3) A Board shall not without the consent of the Minister construct any pipe-line unless the pipe-line is required for the purposes of the business of the Board other than the operation of pipe-lines.

4.37 p.m.


My Lords, this Amendment was on the Marshalled List for the Committee stage. I regret that I was not in this country at the time it was called, so I should like to move it for the purposes of inquiry. At the time of the Second Reading the noble Lord, Lord Chesham, indicated that there would be no restriction on the Transport Commission or its successor authorities constructing pipe-lines for purposes other than for their own business. As I read it, Clause 11, subsections (2) and (3) indicates that there is no authority for the Transport Commission to build pipelines to convey other people's goods—in other words to carry out their function of transport, using a new medium. I should like the noble Lord to clear up this point and to let us know what is the real position. I beg to move.

Amendment moved— Page 11, line 29, leave out subsections (2) and (3).—(The Earl of Lucan.)


My Lords, I think I can give the noble Earl some reassurance on this matter, in that as I understand it—I do not think there is much doubt about it—the Board are able to construct such pipe-lines on their own land. I think that is the noble Earl's point. I believe he was worried as to whether they were able to carry other people's goods through pipe-lines on their own land. May I just ask him whether that is correct?


No, my Lords. My inquiry is whether the Transport Bill, by Clause 11, gives the authorities power to build pipe-lines and, by a subsequent clause, to acquire land for the purpose, or whether they have to follow the proceedings that will be laid down by the Pipe-lines Bill.


My Lords, I must apologise to the noble Earl for not being quite clear as to what he was after, but I wanted to answer him correctly. As he knows, because we discussed this very thoroughly in Committee, the Boards do not have powers to construct transport pipe-lines at large: the powers they possess are restricted to constructing, or arranging for other people to construct in conjunction with them, pipelines which are mainly on their own land. We have already had some discussion about the word "mainly". They cannot acquire other land for the purposes of pipe-line construction, except for small parcels which they need for the purpose of filling in gaps in the pipeline route and to make a sensible lay-out of it. In the later clause they do not have specific compulsory powers to do this. Powers are available in the Pipe-Lines Bill for them to apply for compulsory purchase powers in exactly the same way as any other pipe-line operator. I hope that that answers the noble Earl's inquiry.


My Lords, in view of that, I should like to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 12:

The Boards' powers of manufacture and production

12.—(1) Each of the Boards shall have power to construct, manufacture, produce, purchase, maintain and repair anything required for the purposes of the business—

  1. (a) of that Board,
  2. (b) of any other Board, or
  3. 40
  4. (c) of a subsidiary of any of the Boards or of a subsidiary of the Holding Company,
and, subject to section of this Act and to the following provisions of this section, the Boards shall not have power to construct, manufacture, produce, purchase, maintain or repair anything not required for any of those purposes.

(5) Without prejudice to so much of subsection (1) of this section as restricts the Boards' powers, a Board shall not have power to manufacture, otherwise than for purposes of research or development, road vehicles, bodies or chassis for road vehicles or major components of road vehicles.

This subsection shall not come into force as respects the Railways Board until the expiration of the period of three years from the vesting date, so, however, that if it appears to the Minister that that Board can properly terminate the activities restricted by this subsection before then, he may direct that for the period of three years there shall be substituted such shorter period as may be specified in the direction.

LORD STONHAM moved, in subsection (1), to leave out all words after "business" and to insert instead: of any Board or Nationalised Transport Undertaking, and in addition may undertake such work of manufacture or repair as may be necessary to operate its factories and repair shops efficiently and economically.

The noble Lord said: I beg to move Amendment No. 16. Your Lordships will know that Clause 12 gives the Boards power to construct or repair anything they require for the purposes of their own business; but, as it stands at present, they will not be allowed to construct or repair similar goods for any other outside organisation. It is that limitation which, by this Amendment, we seek to remove. The Government have continually declared that the policy they seek to implement in this Bill is to give the Boards as much commercial freedom as possible, and to take all possible steps to make them profitable concerns. We feel that this particular restriction of the railway workshops is a complete negation of that policy.

For more than a century, as is well known, the railways have built and repaired their locomotives and rolling stock. They have a number of well-equipped workshops with fine teams of craftsmen, most of whom started as apprentices in the shops, and they take a pride in their work. Unfortunately the nun-down of general requirements, perhaps to some extent the changes to other types, has meant a considerable decline in the amount of work available to the railway shops. Redundancies have already been declared, and it is feared that there may be many more. Within the next twelve months, for example, it is anticipated that 850 men will be sacked from the shops at East-leigh, 180 from Horwich, and 600 from Swindon. Naturally, the men, fearful for their future, are, if they get the opportunity of alternative employment, now leaving of their own accord. This does not mean merely the break-up of good teams. Naturally enough, the most highly skilled men go first, and this has already created difficulties in meeting some of the existing demands. The under-manning and under-use of facilities, the empty workshop space can have only one result: inefficient production and increased losses.

Generally, the railway workshops are already running at a heavy loss, but this arises mainly from the repair work which occupies about five-sixths of their time. New locomotives are being built efficiently and profitably. We submit that if the Government were serious about commercial freedom and profitability they would remove this restriction which prevents the Boards, and will prevent the Boards to an increasing extent, from using these facilities to the full. We think also that it is the negation of commercial freedom to insist that these great works, representing such a very large capital investment, should be kept arbitrarily perhaps 50 per cent. or three parts idle.

Certainly, in our submission, it is no answer to say that you want the Board to concentrate on running the railways and not to dabble in matters outside their province, because obviously it is their province. They are given power to build and repair rollingstock, and it is their business to do so. Equally, in our submission, it is no answer to say that there are private concerns who are short of orders for this work. No disability is placed upon them; we are not suggesting they should be prevented from supplying the railways. Our Amendment merely asks for a fair deal and no favours. As the Bill now stands, it gives all the favours to private industry and deprives the Board of a chance to help themselves.

Nor can it fairly be argued that to accept this Amendment would provide the Railways Board with an opportunity to under-cut private industry, because they will be obliged to run their workshops on commercial and profitable lines. That is inherent in the policy embodied in this Bill. If they can do this with the help of private contracts which they can get in the open market, I cannot see any possible reason for preventing it. In fact, we should all wish them luck. We allow the Royal Dockyards and Royal Ordnance Factories to do precisely what we are saying the railway workshops should be allowed to do; it is exactly the same principle. It seems to us wrong that the Boards are to be debarred from tendering for outside work in order to benefit private firms of locomotive manufacturers.

I should like to make it clear that we do not seek by this Amendment to create a large-scale manufacturing industry under the Railways Board. They have not the facilities, and the Minister certainly would not allow them the capital, or indeed allow that kind of expansion, anyway. He has full powers to stop it even if the Board were ambitious in that direction. Our sole purpose is to ensure that these skilled teams are not broken up; that well-equipped and costly workshops should not become, as it were, semi-derelict; that they should be used efficiently and to the full so that they can play a full part in the effort to make the railways pay. I would submit that their attitude to this Amendment is a test of the strength of the Government's determination to see that the Railway Boards are given commercial freedom and, as it were, a free hand to do their best. If the Government accept this Amendment, it will be a sign that they are willing to give the railways every possible chance, and I hope they will do just that. My Lords, I beg to move.

Amendment moved— Page 12, leave out lines 4 to 11, and insert the said new words.—(Lord Stonham.)

4.51 p.m.


My Lords, the noble Lord, Lord Stonham, made some play with this question of commercial freedom, and I do not disagree with him; but he has taken what I consider very dangerous ground upon which to build up a case for keeping the railway workshops to a size which is not justified, or may not be justified, by the course of events. I would first remind your Lordships that this Amendment goes far beyond the powers of the British Transport Commission, who at present can manufacture and repair only for their own purposes. I have found that one of the most dangerous things for any business, whether it is public or private, is to rush into other businesses for which it is not equipped. The noble Lord mentioned the Royal Ordnance Factories. They had cause to rue the day when they went into all kinds of private manufacture in attempting to keep their factories going. It is a very unwise thing to do, and if our intention were only to see that they did not do that, we should be justified in confining them to manufacture for their own purposes. It is of course possible that they could cut out private industry, and themselves carry on the manufacture of locomotives and railway equipment, but it would be very undesirable for them to do that. As the noble Lord has said, private industry itself has surplus capacity in many of the lines for which the workshops are equipped. But, after all, we depend upon private industry to carry out our export trade, and for that they need a certain home requirement so that they can face the competition to which they are subjected. They are equipped for and have the knowledge to carry out the export trade. The railway workshops are not in the same position, because the requirement is not the same.

I really approach this matter on commercial grounds. One can, of course, sympathise with any industry that has to see part of its capacity unemployed and one can sympathise in particular with the men who are affected; yet it is an inevitable consequence of a falling off in demand. I am sure we should be wrong to give a power now, which they have never enjoyed, of manufacturing and repairing in competition with private industry for customers outside the transport undertakings. Therefore, while I regret that the course of events might mean that these manufacturing facilities should be cut down, I suggest that the alternative proposed by the noble Lord, Lord Stonham, would not be at ail wise.

On Question, Amendment negatived.


My Lords, the next Amendment and, incidentally, No. 18A, are both purely drafting Amendments, consequential on No. 14A which your Lordships have just accepted. I beg to move.

Amendment moved— Page 12, line 8, after ("section") insert ("(development of land)").—(Lord Chesham.)

On Question, Amendment agreed to.

4.57 p.m.

LORD STONHAM moved to leave out subsection (5). The noble Lord said: My Lords, whatever case there may be—and there obviously is quite a case—for denying the Railway Boards the right to undertake outside contract work, I would submit there can be no shadow of a case, either on economic grounds or in equity, for depriving the London Transport Board of the right to build their own buses. They have this right at present and they have had it for thirty years. Indeed, the right to build their own buses was continued in the present Bill, in accordance with the Government's policy of preserving the powers already possessed under the 1947 Act by the London Transport Executive. In my submission, therefore, the acceptance during the Report stage in another place of an Amendment which has now become subsection (5) and which I am asking your Lordships to delete involves a complete reversal of existing practice and of the general Government policy pursued in this Bill.

In seeking in another place to justify this last-minute change, the Minister of Transport declared, first, that it was not London Transport's job to build buses; secondly, that they do not engage in this work; thirdly, that it was not likely that they would wish to do so. My Lords, they were three inaccuracies in one sentence, because I may say, dealing with the first two statements, that under the 1933 Transport Act they built 527 bus bodies at Chiswick every year right up to the outbreak of war; and the 1947 Act, the first post-war Transport Act, continued that right. They spent millions of pounds on their fine factory at Aldenham, near Watford, and on improvements to the Chiswick factory. The only reason they have not since the war built bus bodies at those two factories is that they have been sufficiently busy on repairs and overhauls. That is no longer the case.

With regard to the Minister's third statement—that they do not wish to build bus bodies—that again is wrong. In February of this year the London Transport Executive told the unions that they were investigating the possibilities of restarting commercial production of new bodies under the powers which would remain to them when this Bill, as it then was, became law. That, of course, was before the Report stage, when the Amendment was inserted; and the Transport Executive did in fact protest to the Minister about the Amendment as soon as they had news of it. The trade unions have protested most vigorously, and they even pressed the Minister to receive a deputation, but he has refused. Therefore, there can be no question that bus building has been, and is, London Transport's job, and that they want to do it.

None of the arguments which were used against the last Amendment that I moved can be used now; indeed, the arguments used by the Minister in another place for imposing this restriction on London Transport are demonstrably false, and his case falls to the ground. In the light of these indisputable facts, it is difficult to avoid the conclusion that the Government's action arises from a determination to assist outside industry, the builders of buses.

Since I raised this matter on Committee stage in your Lordships' House, we have had news of the Leyland/ A.C.V. merger. It is rather curious that during the Committee stage in another place Mr. John Hay, the Parliamentary Secretary to the Ministry of Transport, then opposing a move in favour of the big private companies, said this: Frankly, if people like A.E.C. and Leylands—the big manufacturers—cannot meet competition from little firms … then it is time that A.E.C. and Leylands woke up a bit.

Obviously, my Lords, they have woken up: first, by persuading the Government to shut down the little concerns; and, secondly, by their merger, which the Daily Express described as a £130 million bus ride".

The Economist's headline was: A merger of mastadons".

The Commercial Motor described it as, the biggest in the world", and the Statist as a "heavy get-together". Whatever the headline, it is obvious we are all going to be taken for a ride—and a very expensive one at that.

The Chairmen of Leylands and A.C.V. declare, according to the Press, that the deal will benefit both shareholders and workers and will be in the national interest.

Certainly A.C.V. shareholders have no cause for complaint, because their shares went up 15s. overnight. The only certain thing about the workers is that many of London Transport's 6,000 skilled workers at Aldenham and Chiswick are likely to lose their jobs. As for the national interest, I would ask the Government this question: is it, in their view, in the national interest to bind a public corporation like the London Transport Board hand and foot to a private monopoly?—because that will be the situation unless this Amendment is accepted.

The A.C.V.'s A.E.C. badge is at present on every bus in London. They are very good buses, the best in the world; and doubtless they are sold at a fair commercial price. But that, I would submit, is because there has been an alternative supplier in the field. In future, there will be no major alternative supplier—in fact, no practical alternative unless London Transport has the right to build its own buses. I am not suggesting that London Transport should build them all, or nearly all—I do not suppose they will want to. But I submit that it is the plainest commercial common sense to allow them to use their existing plant, equipment and manpower for the building of a number of buses which will serve as a yardstick for quality, performance and price. I believe that there is no single Member of your Lordships' House who does not, in his heart, say "Yes" to that proposition.

I am prefectly well aware that the two giant concerns I have mentioned, now one, are valuable exporters, and that their ability to compete abroad depends on a thriving home market. That, of course, is an argument in favour of this merger. Doubtless they can reduce costs and be in a better position to carve up the home market; but that is no argument for allowing them to carve up London Transport. Nor, I would submit, can the Minister argue that the three small body-building concerns which will continue under the Holding Company will give London Transport an effective brake or yardstick. How fantastic it is, under the Bill, to give London Transport the right to build buses for research but not for use—in other words, to do all the expensive work and then hand over the proved model to a private monopoly so that they can build the buses for use and get the benefit!

I would submit, my Lords, that another remarkable thing is that there is no restriction on the powers of manufacture of the three small body-building works which are to be taken over by the Holding Company. In theory, therefore, they could build for London Transport: in practice, they cannot. Eastern Coach-works, for example, have a maximum annual capacity of 750 bodies; but all these are needed to cover the needs of Tillings. The more you look into this matter, the more remarkable, indefensible and suspicious it is. Eastern Coachworks have no production limit placed by the Bill on their capacity to build, because they cannot build any more than Tillings need. London Transport, with two much larger factories, with surplus capacity and 6,000 workers, who do want to build more buses, are not to be allowed to do so. My Lords, is there any possible excuse, in the sweet name of reason, for this difference of treatment, in the same Bill, for two identical sections of the transport industry? There is none.

If, therefore, the Government insist on retaining this subsection and depriving London Transport of the right to build some of their own buses, it can be only because they are determined that the orders must go to a private monopoly. I do not want to describe that as a scandal, but I do say to the Government that they are boosting a private monopoly and making a perfect set-up for nationalisation when Labour returns to power at the next Election. It is certainly one or the other, or perhaps both. In reply to the Amendment which I moved just previous to this one the noble Lord, Lord Mills, insisted, with a good deal of reason, that railway workshops must be devoted to railway work. Now, in the same clause, the Government are saying that road workshops must not be devoted to road work. When I raised this matter on Committee stage, the noble Lord, Lord Mills, said he was not going to argue, but would merely state the facts. On this occasion, my Lords, I think I have stated facts which are indisputable, and I have drawn some conclusions which are disputable. I think they call for both answer and argument. If these are not forthcoming, or if they fail to deal with the points raised, I do ask your Lordships to join with me in persuading the Government to accept this Amendment. I beg to move.

Amendment moved— Page 12, line 36, leave out subsection (5).—(Lord Stonham.)

5.10 p.m.


My Lords, I rise to support the Amendment which has been so admirably moved by my noble friend Lord Stonham. I do so with more zest, perhaps, because I was associated with some of the material events connected with this power resident, up to the moment, in London Transport to build bus bodies up to the number of 527. I think it must be borne in mind, in considering this question, that this power, which was embodied in the 1933 Act, was approved and passed, and in point of fact given, by a Government which was predominantly Conservative. It was the result of negotiations with the trade, negotiations which were admirably conducted by the noble Earl, Lord Swinton, who was at that time in charge of the Bill. Those powers were continued in the Act of 1947 and in the Act of 1953. Indeed, by the Act of 1947 the powers of London Transport, as with other constituents, were extended. In 1953 the power was still preserved.

The powers were granted to London Transport before the war, and all of them were carried out at the Chiswick Works. Aldenham was first built as a railway depôt. It was intended to extend the line from Stanmore to Bushey, and the smaller of the two factories at Aldenham was built, as I have said, as a railway depôt. During the war it was used for the assembly of the Halifax bomber, in conjunction with Handley-Page and four other manufacturers. After the war it was decided not to proceed with the intended extension of the railway, for the reason that the intended development of the area had changed and it was unlikely that there would be sufficient railway traffic to justify the cost of the extension of the line. Accordingly, Aldenham became at that moment redundant, and it was decided to use it for the repair of bus bodies and to extend it so that, with Chiswick dealing with chassis and Aldenham dealing with bodies, there would be facilities adequate for dealing with a fleet of buses which it was anticipated might reach the number of 12,000. We proceeded to add, by way of extensive building at Aldenham and by way of modernisation at Chiswick, very considerably to the overhaul capacity of the undertaking.

As it has fallen out, 12,000 buses proved to be in excess of the likely need, for two reasons: first, because there has been a reduction in services and fewer buses are needed to carry the traffic; and secondly, because the period between overhauls has been substantially extended. In fact, it has gone up from 2½ years to 3½ years, and it is likely that it will go to 4 years, which means, of course, that fewer buses are idle, fewer are needed than would otherwise be required in order to deal with the traffic. So it falls out that Aldenham has excessive capacity. It is probably one of the most up-to-date factories for bus-body overhauls in the country, and maybe in Europe; but it is unlikely that its whole capacity will be needed for overhauls.

What do the Board (the Executive, as it now is) intend? They intend, according to the statement which has been made by my noble friend Lord Stonham, under the powers which they presently have—if that power is maintained—to build bus bodies. The Minister, however, proposes to take away this power, which the undertaking has had for over thirty years. I know that the noble Lord, Lord Mills, will probably say that it has not been used. There are reasons for that, some of which were given by my noble friend Lord Stonham. A principal reason was the very substantial accumulation of overhaul work, but more important was the fact that, owing to the difficulties of getting a supply of new buses after the war, London Transport had to resort to six different types of bus. There was, therefore, vary little, if indeed any, effective standardisation of units, and the overhaul work took very much longer than was expected; and than would have been the case had the buses been of a normal, standard type.

Now the undertaking has standardised its buses, and no longer is a bus taken in and left for repair, for overhaul, or for maintenance; it is taken in and a unit is taken out and exchanged, because practically all the units of the bodies are now interchangeable. That, of course, also results in there being less facilities needed, because the buses, as I have said, are idle for a shorter time. In the result, not only has there been this lengthening of the period between overhauls, with much economy, but the cost of overhaul has been reduced in other directions, in total by some 25 per cent. If London Transport were able, and were permitted, to build bus bodies, that could, of course, be added to, because there would be a bigger turnover going through the factory and works, and there would be a wider spread of overheads. The noble Lord, Lord Mills, does not need me to tell him of the beneficial effect of that. London Transport would, as I have said, be able to spread the overheads, and would also be able to engage in exploration of new, modern methods; indeed, they might proceed to some aspect or element of automation.

There is also the other valuable circumstance that this reserve power, if I may so call it, resident at present in London Transport to build bus bodies, can be a valuable preventive and corrective as regards the prices charged by suppliers outside. I find it difficult to understand what is in the minds of the Government, and especially, if I may say so with respect, what is in the mind of the noble Lord, Lord Mills. He has had a wide and varied experience as an industrialist. He knows as well as any man that there is nothing more discouraging in a factory for the workpeople, whether they be high executives or walking the floor of the shop, to see capacity unused, to notice valuable machines, for which many workpeople have quite an affection, lying idle. If there is excess capacity not used, it makes nothing of all these exhortations for increased production. What we need as a dynamic is the pressure of orders behind us, not the prospect of no work in front of us. If that circumstance exists, it leads to slackening, to a desire not to hurry with the job because, when the job is finished, there might be redundancies and some dismissals.

If the nationalised undertakings such as London Transport are to be viable, they must be given the opportunity to be viable. We cannot say to London Transport that we expect them to pay their way but, because of our policy, a certain percentage of their facilities, certain parts of their machinery and accommodation, must be unused, must make no contribution, must not even pay their rent. I cannot understand how the noble Lord, Lord Mills, can square that with a policy of growth, of increased productivity and of securing efficiency.

Then there is the other point which my noble friend Lord Stonham raised. It is really Gilbertian. Under the proposed clause, London Transport will be able to build bodies and buses for research and development. This means that London Transport can discover new methods, find out about new materials and about better use of existing materials, which can have all sorts of beneficial results, but they cannot use that research; they cannot embody it in a product. If it is to be of any value at all, it has to be handed over to the contractors, the suppliers of buses. That seems to me to be as Gilbertian as anything that could be discovered even by the present Minister of Transport. Public money will be used to carry out this research and private enterprise will be the beneficiary. This seems to me to be quite indefensible.

Why is the present Minister of Transport proposing to take away this power, which has been in existence for thirty years? There has been no abuse of it. Why should not London Transport be given the opportunity of building bus bodies?


My Lords, the noble Lord says that there has been no abuse of this power. Has there been any use of it? Have London Transport throughout this time built any buses competitive with other suppliers?


My Lords, I did not say that London Transport had not used the power. Before the war the power was exercised at Chiswick in company with the overhaul work, but, of course, the fleet of buses was much smaller than it later became.


My Lords, I want to follow the noble Lord's argument. That was in 1939, and we are now in 1962. Has the power of manufacture been used since the war or have the capabilities been confined solely to repair work?


Frankly, my Lords, they have not been used, and I thought that I gave the reason. The overhaul work took all the available capacity, as it then existed at Chiswick, before it was modernised, and the capacity at Aldenham, because there were six different types of buses acquired immediately after the war when we could not get buses from our normal suppliers. That is the reason why the power has not been used since the war. I understand that for some time London Transport have been getting ready to exercise it. Now there comes this bolt from the blue. Not only for reasons of equity as regards London Transport but also from the point of view of national economy I hope that, even at this late hour, the noble Lord may be able to indicate that the Minister has thought again.

5.28 p.m.


My Lords, I have tried to follow the arguments that have been put forward. I can understand why the arguments of the noble Lord, Lord Stonham, are theoretical, because I do not think that among his many activities he has ever been engaged in the productive side of the motor industry. But the same excuse cannot be made for the noble Lord, Lord Latham, who has had some experience. As I understand the argument, it is desired to give London Transport power to manufacture chassis and complete buses, the better to test the ability and price structure of the industrial suppliers. This is put forward as advantageous for the national economy. Having had a lifetime's experience of the motor industry, I should have thought that the finest way for the State to lose money would be for it to go into the motor field and manufacture in competition with firms who have had 50 to 60 years of experience, equipment that must have cost millions of pounds and a world market in which to test their products. I should have thought that the investment of money in motor manufacture would be the most hazardous enterprise.


My Lords, would the noble Lord allow me to interrupt? Is he aware that the State have already invested money in these works, and that they have experience of building buses before the war? Is he further aware that under this very Bill some small coachworks which are now building bus bodies are being continued? The experience is there all right.


I am quite aware of all this. I am quite aware that in the old days before the war, going back now to 1939, London Transport built a few buses. I am quite knowledgeable of the three small firms that are building bodies. I am also quite knowledgeable of the fact that London Transport have a very up-to-date service and repairs department. But that was not the whole of the noble Lord's argument. He put it forward, on economic grounds, that the State should spend money, because the present equipment that is owned by London Transport for the repair of buses is not comparable in a fraction of a degree to the equipment they would have to install for building buses. Where do they get all the spare parts from? The noble Lord, Lord Latham, is quite right: you do not repair things to-day at a repair shop; you replace the units. Where do they get the units from? From the manufacturers of the buses. They do not manufacture themselves.


My Lords, I am sure the noble Lord will agree that most motor car manufacturers are in the same position.


Of course they are. A motor car manufacturer provides and builds his vehicle from about 50 different suppliers. But when any service station, large or small, comparable with London Transport—which is, after all, only a commercial user—want a replacement unit, they do not make it; they get it from the motor car manufacturer. I have spent my whole life in this industry. If there is one thing I do know something about, it is motor vehicle manufacture and distribution. I have never heard a more crazy and silly argument quoted, supposedly as economics, than has been put forward: that London Transport should enter into competition in this year of 1962 (not 1939) when anybody entering the business of building motor cars, buses or commercial vehicles in price competition with the established manufacturers would have to find millions of pounds in specialised equipment. Believe me, my Lords, I know of no better way of advising the State to lose money than to go into such competition.

If London Transport want buses built by a firm other than A.C.V. there are plenty of other bus manufacturers. But time has proved that they are quite satisfied with their present bus, which I think is the finest vehicle in the world.


And, as the noble Lord will know, designed by London Transport.


Of course it was; again before the war.


No; not before the war.


The noble Lord will forgive me, but the designers of the first London bus were the Associated Equipment Company.


Not this bus.


This has just gone on in the production process. If this were another argument to get in the thin end of nationalisation, I could understand it, and I could have some sympathy with noble Lords for putting it forward. But to put this forward as a sound economic proposition for the Government to embark upon is, I think, just crazy.

The noble Lord referred to the research that goes on—and the research that has gone on by London bus manufacturers in conjunction with the London Transport Board is a model—as though there were something evil in a user carrying out research to see if he could find out something better to suit his requirements and then handing over that knowledge to the producer of his buses. There is nothing evil in that; I think it is sound common sense. I certainly hope that the Government will not embark upon a project as outlined by the proposition in support of this Amendment.


My Lords, the noble Lord, Lord Lucas of Chilworth, has obviously enjoyed himself this after noon, and I am sure we are all pleased that he has been able to do so. There are two issues. First, there is the principle. The Government have said to us at the very beginning that they wish to give the Boards the opportunity of developing as commercial enterprises; that they should be able to use their facilities and their assets to the maxi mum advantage. The noble Lord, Lord Mills, will not dispute that in our work shops in the London area we have work shops of the highest calibre, employing some of the best engineers. I think it was my noble friend Lord Latham who was talking of Handley Page. It is a fact that the London Passenger Trans port Board (as it was then) very quickly, in the early stages of the war, took over the production of aircraft—


That is why they were not building buses.


—and they built over 1,000 Halifax aircraft. I should have thought it was a tribute to their engineering skill that they could move from repairing buses to produce the latest bomber aircraft.

We have these assets, these facilities and this knowledge. The Government recognise in some way that this knowledge is there, because under this Bill they are going to permit the Board to experiment to develop new types of vehicles. If the noble Lord, Lord Mills, were back in business, and were a director of a corporation, I am quite sure he would insist that there should be nothing in the Memorandum and Articles of Association that would prohibit him, as a director of the company, from using the assets, the facilities and the "know-how" of his company to the maximum advantage. But the noble Lord is prepared to come here, as he did on the Committee stage, and say that the Board, whom the Minister will be appointing, men of the highest calibre, should not, first of all, have the opportunity of using these facilities to the maximum advantage; or, secondly (and this is the answer to the noble Lord, Lord Lucas of Chilworth), of using these assets and facilities to manufacture. The noble Lord, Lord Mills, throughout this debate has said that we must trust the Boards; we must give them the opportunity to work out their problems. We agree. And yet throughout the Bill—this is not the only occasion—we have restrictions placed upon the Board. It is significant that the major Amendment which the Government accepted was the one which placed restrictions upon the development of land by the Boards.

There is another side to this matter. We have employed in these works nearly 7,000 experienced men with their machines. These men can be kept up to strength and their productive skill used to the maximum advantage of the Board only if the work is provided. I hope that the Government will see that if, in the judgment of the Board, they can manufacture buses and equipment better and more economically than private enterprise—if this is a dispute between private enterprise and the State—they are not prohibited from so doing. I think this is a real matter of principle. The noble Lord said that these Boards must have the opportunity of using their assets for the benefit of the public purse. Then why prevent them from doing it by such measures as the Government have placed in this Bill?

5.41 p.m.


My Lords, I would not have intervened in this section of the debate but for the contribution made by the noble Lord, Lord Lucas of Chilworth. As one who saw pre-war—though I must admit that I have not seen much of it since the war—a considerable amount of the work done at Chiswick, and as one who has cooperated with some of those engaged on the work, I must say that those works were most efficient. They produced some of the finest buses that this country has had and, based upon the market research which London Transport carried out, they have provided the vehicle to suit the journey and the traffic it has to carry.

What has happened since the war? As my noble friend Lord Stonham said, because of the difficulties which London Transport have had to face with re-modelling of works and vehicles, they have had to provide the specification which the private body-makers built and supplied to London Transport. Anyone who is associated with any transport undertaking, whether road, rail, sea or air, knows that if you are to get the maximum efficiency in operation, the quickest turn-round and the least time in standing of a vehicle unused, you require a degree of standardisation so that vehicles are interchangeable, and you need men who are skilled on the particular parts, likely defects, and all the rest of it, of the vehicle. A multiplicity of types of vehicle leads to all sorts of difficulties in maintenance, additions to staff, and so on. Therefore, not only do London Transport have to study the market, but they have to provide the vehicle, as they did prewar. There is the further advantage that when the manufacturer has manufactured and hands over to the undertaking, he is not concerned except to get the bill paid. If London Transport manufacture, then the same organisation which has built the vehicle maintains it, there is a considerable saving, and they know they have the responsibility of maintaining afterwards.

There is one further point which the noble Lord, Lord Lucas of Chilworth, made. His argument is to get everything to private enterprise. What protection will he give the public and public Boards against exploitation? There is a tendency now in industry (and not only in the motor car and body-making industries) for concentration. Of course, when it is public ownership it is nationalisation and wrong, but when it is private enterprise it is concentration and amalgamation, and then it is quite all right! But when few proprietors are manufacturing, what test is left in the competitive market for London Transport to go upon? If they are given the right to manufacture, they can test the market against the possibility of exploitation by private manufacturers. If that right is taken away, they are completely in the hands of persons outside their own industry, and they become simply operators. What would the noble Lord, Lord Lucas of Chilworth, do in his own private undertakings? If the were an operator he would form a subsidiary company, manufacture, and sell to himself, and make a profit out of it.


My Lords, could I ask the noble Lord this question? Have London Transport made any complaint that they have been exploited? Have they made any complaint that their pricing arrangements with those who build their vehicles are wrong and operate against their interest? Have they made that complaint?


Not so far as I am aware.


Neither is anybody else.


In any case I am not concerned whether London Transport have complained. All I know is that London Transport have an Executive who, prior to the introduction of this Bill and during the early stages of this Bill, were discussing with the trade unions the development of the work on the manufacturing side. The Executive itself wants to undertake the manufacture. Therefore, if they want to undertake the manufacture there are very good reasons for it.

London Transport have not consulted me. The only people who have consulted me from time to time art the workers in the industry, and if I have any contact it is with those who are doing the manufacture and maintenance. So far as the Executive are concerned, I have no knowledge as to their general attitude and their desire to have this included in the Bill. But that is no answer to the point. The noble Lord, Lord Lucas of Chilworth, has drawn a little red herring into the debate by his interjection. In most businesses all the folk try to do is to carry the operation of manufacture, even though it means separate companies. Therefore I hope this Amendment will be agreed to.


My Lords, before the noble Lord sits down, could I ask whether I heard him aright when I thought he said that the private manufacturer is concerned only to get his bill paid? If he did, is he not suggesting to the House that no manufacturer is interested in after sales service?


My Lords, I am very much obliged to the noble Viscount for interjecting, because this is one of those statements which are made without qualification afterwards. My reference was that when he has manufactured the vehicle it is handed over to the operator and he is not concerned about it. He is concerned that if he manufactures a bad product he will not get any more orders and will go out of business altogether. I did not mean it from that point of view.

5.49 p.m.


My Lords, the noble Lord, Lord Latham, was kind enough to refer to my experience in industry and he asked me several questions. There was one question he did not ask me, but I am going to reply to it. The question is: do I agree with the noble Lord, Lord Lucas of Chilworth? The answer is that I agree with every word he said. The noble Lords, Lord Stonham and Lord Latham, gave your Lordships something of the background to this matter, and I will add to that background. The question of manufacturing road vehicles has always received special consideration in relevant transport legislation, beginning with the Transport Act, 1947. The effect of subsection (4) of Section 2 of that Act was to lay down, in considerable detail, just how many vehicles the Commission could manufacture on a yearly basis. These were therefore distinguished from the general run of things manufactured by the Commission. So the Commission even in the 1947 legislation, were subjected by the Act to arbitrary statutory quotas which could not be altered except by new legislation.

I should like to put on record what is the situation. Taking first the British Railways Board, I would point out that the railway workshops at Wolverton and Temple Mills (London) produce about 220 new road vehicle bodies or trailers a year, valued at about £77,000. Some 70 staff are employed on this work. For London Transport, the Docks and British Waterways there was no road vehicle manufacture at all. These figures show that in their main activities the Commission found it desirable—and I do not wonder at it—to satisfy their considerable road vehicle needs, except for a small British Railways requirement, by placing contracts with other manufacturers and not by undertaking this specialised manufacture themselves.

The former London Transport Board under the London Transport Act, 1933, were given powers to manufacture a limited number of road vehicle bodies—527 units each year. This quota was inherited by the British Transport Commission when they took over the London Transport Board's undertaking following the Transport Act, 1947. The Commission, however, did not make this quota available to the London Transport Executive. Neither the former London Passenger Transport Board nor the London Transport Executive, as its successor, have manufactured road vehicles of any kind since 1939. It is true that the Aldenham works now engaged on the repair and maintenance of buses would have capacity, with the addition of plant, to carry on the manufacture of road vehicles, but no road vehicle has ever been built there, and so to talk about their expertise is not really sensible. It is almost impossible, I suggest, for workshop capacity to be turned over to manufacturing work—I refer, of course, to workshops engaged on repair and maintenance. The situation, therefore, is that London Transport have not chosen for over twenty years to engage in the manufacture of road vehicles. The task of the London Transport Board, I suggest, is to run London Transport and the Government do not envisage as part of that task the manufacture of road vehicles or the development of capacity for that purpose.

I do not understand this urge for concerns engaged in one operation to manufacture everything for themselves. One might as well suggest that every firm using large numbers of machine tools should set about manufacturing them for themselves instead of going to specialists engaged on this work. As I said, the noble Lord, Lord Latham, has referred to my experience. What has my experience been? With all the concerns I touched, my experience was of taking away the things which they ought not to be engaged in making and letting them concentrate on their main tasks. It is. I suggest, ridiculous for a firm to run a small brass foundry when there are specialist firms who can afford to spend money on research and development and from whom they can buy.

The noble Lord, Lord Lindgren, tries to frighten us with the fact—or what he thinks is the fact—that the London Transport Board would be exploited in the supply of vehicles. I have no reason to think that could happen. They are quite capable of looking after themselves. What they should do perhaps when they are fully efficient—and I probably think they are—is to concentrate on their ability to buy vehicles at the right price, and not to indulge in dreams of manufacture, Which, as the noble Lord, Lord Lucas of Chilworth, has very rightly said, would cost this country great sums of money. I am sorry, I cannot accept the Amendment.

5.57 p.m.


My Lords, I regard that as a very disappointing reply, in the main because the noble Lord, Lord Mills, did not reply to the points which I made. Of course the noble Lord, Lord Lucas of Chilworth, is quite right in saying that I have never built any bus bodies. Neither, indeed, have I ever been bitten by an adder, but I am prepared to accept that it is a painful operation. I have been relying for what I have said—and the case has not yet been answered—on the statements and knowledge of people who do know about building buses. One point which the noble Lord, Lord Mills, just did not answer was the fact that although, as he said, London Transport have not built buses since 1939, he, and all of us, are well aware of the reason for that. The reason was not that they did not have the knowledge, expertise and know-how; it was simply that their workshops were full up with repair work because of the large diversity in types of buses; and that is no longer the position. The 7,000 trade unionists who work there, members of three of the largest unions in the country, are not just imagining the prospects of redundancy. They do not write urgently to the Minister of Transport asking him to see them just for nothing; because everything is going to be perfectly all right. They are enormously, and with good reason, afraid of losing their employment.

I have mo doubt that it does require millions of pounds, great knowledge and large plant in older to be able to build bus bodies. But London Transport have investments running into millions of pounds; they have two quite large plants; they have built buses. So it really is nonsense to say that they cannot do so. Indeed, I was surprised that the noble Lord, Lord Mills, agreed with every word that the noble Lord, Lord Lucas of Chilworth, said in that respect. But the point is that it is admitted that three much smaller concerns of body builders are to continue building. Indeed, restrictions on the numbers of bodies they can build have been completely removed by this Bill. The only restrictions placed on bus-body builders, or potential bus-body builders, are those placed on London Transport, who have the capacity to build. I think there just cannot possibly be an answer in equity to that.

The noble Lord, Lord Mills, said that the task of London Transport is to run London transport; and he told us that whenever he has been called in to matters of a similar kind he has always urged that the things in which they should not be engaged should be taken away, so that they can concentrate on the things they are best fitted to do. That is a paraphrase of what he said, and I should have said that that is a very sound principle. But they are doing these things. What was just said would be an argument for taking away their repair and maintenance facilities altogether. Yet that is not suggested. It would also be an argument for shutting down the railway workshops altogether. They have built locomotives for very many years, and they are to be allowed to go on building them. It could be argued that running railways is the task on which the Railways Board should concentrate, and that they should not have workshops for building and repairing locomotives.

In this Amendment we are asking for London Transport exactly the same treatment as is accorded to the three companies which will go to the Holding Company. We are asking for the same treatment as the railways have in respect of workshops. We have not heard one sound reason against that case. I very much regret that should be so, and still more that thousands of men who are anxiously awaiting the outcome of these discussions should be so bitterly disappointed. I hope that your Lordships in all parts of the House

Clause 13:

Supplemental provisions relating to the Boards' powers

13.—(1) Subject to this Act, the Boards shall have power— (b) without prejudice to the foregoing paragraph, to enter into agreements with the other Boards and with any subsidiary of any of the Boards or of the Holding Company, for the management, working and use by one party to the agreement of works, land or other property belonging to the other party, and with respect to the rendering of services and the pooling of receipts or expenses,

6.9 .p.m.


My Lords, with your Lordships' permission, I will speak to Amendments Nos. 18 and 20 at the same time because they hang together. As the Bill is drafted, some people have will go into the Lobby and support us on this Amendment.

On Question, Whether the said Amendment shall be agreed to?

Their Lordships divided: Contents, 23; Not-Contents, 59.

Addison, V. Crook, L. Lucan, E. [Teller.]
Alexander of Hillsborough, V. Geddes of Epsom, L. Shackleton, L.
Amwell, L. Greenhill, L. Shepherd, L.
Archibald, L. Henderson, L. Stonham, L.
Burden, L. [Teller.] Kenswood, L. Summerskill, B.
Burton of Coventry, B. Latham, L. Walston, L.
Champion, L. Lawson, L. Williams, L.
Chorley, L. Lindgren, L.
Albemarle, E. Denham, L. McCorquodale of Newton, L.
Ampthill, L. Derwent, L. Mancroft, L.
Astor, V. Foley, L. Massereene and Fcrrard, V.
Atholl, D. Forster of Harraby, L. Merrivale, L.
Auckland, L. Fortescue, E. Mills, L.
Balfour of Inchrye, L. Fraser of North Cape, L. Molson, L.
Bathurst, E. Geddes, L. Napier and Ettrick, L.
Blackford, L. Goschen, V. Newall, L.
Bossom, L. Grenfell, L. Newton, L. [Teller.]
Brecon, L. Hailsham, V. (L. President.) Rea, L.
Bridgeman, V. Hastings, L. Runciman of Doxford, V.
Broughshane, L. Hawke, L. St. Aldwyn, E. [Teller.]
Carrington, L. Hereford, V. St. Oswald, L.
Chesham, L. Iddesleigh, E. Sandys, L.
Colwyn, L. Jellicoe, E. Sinha, L.
Colyton, L. Kilbracken, L. Somers, L.
Conesford, L. Kilmuir, V. (L. Chancellor.) Stuart of Findhorn, V.
Coutanche, L. Lambert, V. Teynham, L.
Crathorne, L. Long, V. Westwood, L.
Croft, L. Lucas of Chilworth, L.

Resolved in the negative, and Amendment disagreed to accordingly.

expressed surprise that there should be the power for a statutory company not only to enter into working agreements with non-statutory companies, but also to be able to delegate their functions. As this appeared to be rather unprecedented and nobody knew for what purpose it was really required, I have been having some correspondence with my noble friend the Parliamentary Secretary. He has written me on the subject, and if he gives the substance of his reply to get it on the Record, I think it will probably satisfy those people who have been expressing doubts. I beg to move.

Amendment moved— Page 14, line 22, leave out (" or of the Holding Company ").—(Lord Hawke.)


My Lords, I am grateful to my noble friend for saying that, and for indicating that he intended these Amendments to be exploratory. Without going into great detail at great length, I must first say that the effect of Amendments Nos. 18 and 20 taken together would be to create a condition of absolute chaos in the operations of the Boards. I understood my noble friend to say in Committee that what was really worrying him and others was, for instance, the possibility of the London Board getting together with bus company subsidiaries of the Holding Company in order in some way to get round the necessity to have a road service licence to operate a service—for instance, that they might be able to run a through service from London to other parts of the country. I am happy to be able to give my noble friend the reassurance that he wants, and to tell him quite definitely that there is nothing in those fears.

The provisions of Clause 15 which refer to delegation are primarily concerned with the vires of the Boards. Their purpose is to give the Boards power to enter into working agreements as to which there might otherwise be technical doubts, because of the Boards' position as statutory corporations. But there is nothing in Clause 15 which would enable the London Board to transfer to some other body, even if there were to be a working agreement, exemption from the need to obtain road service licences for the services that they give to the Board. I am advised that any person or body who wanted to operate in the London area, other than the London Board, definitely would not only have to obtain the consent of the London Board, as provided by Sections 16 and 17 of the London Passenger Transport Act, 1933, but also have to obtain a road service licence as called for by Section 134 of the Road Traffic Act.

I think we have to remember that the question whether a service is provided by the London Board or some other body clearly falls to be decided under the Road Traffic Act, 1960. Section 134 (2) of that Act clearly provides that a vehicle shall not be deemed to be used under a road service licence unless it is so used by the holder of the licence. The fact that Company A provides a service under a working agreement with Company B does not mean that the first company can avail itself of a road service licence held by the second company. In the general context of that Act everything points away from any looseness of interpretation in this matter, and there is no room for doubt that a service extending beyond the limits set by law for the operations of the London Board cannot pretend to be a service operated by that Board. I think the matter is perfectly clear. This does not leave any room for in any way dodging round the requirements for road service licences. I hope that my noble friend will be satisfied with that explanation.


My Lords, I thank my noble friend for his explanation. I take it, then, that the purpose of these slightly unprecedented provisions in this Bill is to give the Board power to enter into working agreements as to which there might otherwise be technical doubts, because of the Board's statutory position. My noble friend is not a lawyer; nor am I. I have not the slightest idea how or why there could be statutory doubts; but presumably the lawyers have put these words into his mouth, and they will be examined by other lawyers to see whether they agree with them. If they do not agree, the only thing is to come back at the next stage.


My Lords, if I may, with the leave of the House, make a further brief observation, I cannot pretend to understand the legal ramifications of this position, but I understand that the position of a statutory board does need clarification if it is to enter into such working agreements. Such working agreements might be with British Road Services for the joint operation of collection and delivery services, or something of that kind; and I think it is most essential that there should be no doubt that that kind of arrangement can be entered into by the Board.


It sounds like another Cunard-Eagle arrangement.


My Lords, with that explanation I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 14[Compulsory purchase of land]:


My Lords, this Amendment is consequential and drafting. I beg to move.

Amendment moved— Page 16, line 11, at beginning insert ("(development of land)").—(Lord Chesham.)

On Question, Amendment agreed to.

Clause 22 [Special provision for British Waterways Board]:

6.20 p.m.

THE EARL OF LUCAN moved, in subsection (1), to leave out "five" and insert "ten" [years]. The noble Earl said: My Lords, I think we are entitled to a little more explanation from Her Majesty's Government on this point. Clauses 21 and 22 of the Bill allow for financial help to the British Waterways Board, recognising, quite rightly, that the Board cannot be expected to pay its way. There is a period of five years set during which this financial help, both grants to cover deficits of annual review and loans to cover capital expenditure, can be authorised by the Minister. Why five years? Is it just a convenient space of time that was thought up by somebody, or is it a calculation? If so, what was the calculation which led the Government to believe that after five years the British Waterways Board, as set up under this new Bill, would be able to pay its way?

My Lords, we know that the financial position of British Waterways, as a component part of the Transport Commission, has fluctuated over the years in accordance with the general prosperity and activity of the country. They have suffered competition from rail and road; they have had to meet larger expenses in the way of maintenance and replacement of equipment and gear. The result is that their results have fluctuated, but they have always been "in the red". Their operating account has shown a deficit varying between £170,000 and £860,000 in a year. Their revenue has climbed very slowly from £2½ million to something over £3 million.

Some noble Lords may think that the greater energy expended in prosecuting the new activities of the waterways may increase their revenue; but looking at the Commission's Reports on the waterways, year by year, I feel that there is no ground whatever for supposing that there will be any spectacular increase in revenue within five years. There will be improvements in revenue from the supply of water, from pleasure boat licences, possibly from angling—all those uses which the Bowes Committee called "alien uses of the waterways" and which are likely to bring in a certain amount of revenue year by year. But, equally, the expenses are likely to go up year by year. Having regard to the published figures, there seem no grounds whatever for taking the optimistic view that after five years the Board will be able to become what is now called viable, but what one might describe as in a position to pay its way. One wonders what caused the Government to put this figure in the Bill, and whether it is too late to change it. It seems totally unrealistic to suppose that in 1967 or subsequent years no financial help will be available to the Waterways Board, either in the form of capital loans or in the form of subsidy, to make good any revenue deficit. May we hear the Government's explanation on this?

Amendment moved— Page 22, line 15, leave out ("five") and insert ("ten").—(The Earl of Lucan.)

6.26 p.m.


My Lords, I should, of course, be delighted to give the noble Earl the explanation for which he asks. I was made very much happier when he indicated that his Amendments were explanatory rather than anything else, because had they been intended to be substantive I should have had to say a good deal more about them. But some of this will become clear in the course of my explanation. If the noble Earl, in his consideration of the Bill, had come to the conclusion that the period of five years had been included because it was thought that the British Waterways Board would by then have (this rather curious word) a "viable" organisation, he would not have been quite right. I agree with the noble Earl that it would be over-optimistic indeed to expect that the Board could reach that stage in that time.

As things stand, we are taking the first steps to help them towards viability. They are getting an entirely new structure; they are being left to get on with their own job, divorced from the railways, and there is considerable provision for financial assistance. But, even so, I do not think anyone would imagine that, however well and energetically run, the Waterways Board could get themselves out of the "red" in a period of five years. In that period what is easier to envisage is that there will almost certainly have to be some other kind of action taken to help put the waterways on a sound long-term basis. I think we shall certainly have to consider whether further legislation will be necessary. That, of course, will be the time to consider the duties which are placed on the Board. It will also be the right time to consider any further financial provisions that may seem to be necessary. Meanwhile, I think it would be unreasonable to ask Parliament to agree to provide assistance of this kind, up to a maximum of £10 million, for more than five years ahead. I think that to select ten years now would be looking too far ahead, in view of the other action that we should probably have to take; and it would be too long to go without giving Parliament a chance to review progress before it was asked to renew, extend or otherwise alter the financial provision that had been made.

Further, I think it would be unfortunate to select a period like ten years because it would be depressing for the new Board to feel, right from the start (although we may feel misgivings), that there was really no hope for them at all. A longer period would have a pretty depressing effect on them, and five years seems the most reasonable period for the Board to get under way, to see how they are going, and to give opportunity for further consideration, both financial and legislative. That is the secret of the five years.


My Lords, may I ask the noble Lord about one thing he was saying, which interested me very much? Is there, in fact, in contemplation legislation in the future, setting, up a new framework for the waterways within this period of five years?


My Lords, if the noble Viscount means: do I have some draft in my brief case, the answer is, No. But I do not think it would be very unintelligent anticipation to foresee that it might well prove that such reconsideration was necessary.


My Lords, I thank the noble Lord very much. I hoped that he did not have a draft in his brief case, as I think things will have to be carried a lot further before that can possibly be done. But we are, indeed, glad to hear that something is going to be done in the near future, because this Bill as it stands leaves the waterways in a most shabby state.


My Lords, I am most grateful to the Minister for that explanation—which relieves my mind very considerably—that it is, in fact, an interim arrangement to cover the first few years of the set-up under the new Bill. Whether it is the best action for the morale of those concerned in the waterways to give it one more experimental period or interim period, I rather question. We have just come to the end of a two-year experimental period, when the Government said that they needed two years to decide on a policy for the waterways. They have brought in this Bill; but, as the Minister said, there are many other things which will need further consideration, and further decisions about the future policy for the waterways will be required. The uncertainty that has been hanging over those employed in this industry, will be only partially alleviated by the five-year period of grace given them, when the taxpayer is going to see that the waterways do not run down and that they do not become more shabby or more incapable of use. Therefore. I think I can again express my gratitude to the Minister, in the hope that the matter will not be allowed to go to sleep after this Bill has been passed, and that the Government will actively take in hand a long-term policy for the waterways. I beg leave to withdraw the Amendment.


My Lords, before the noble Earl does that, may I ask leave to say one further word, and that is that I do not want him to be under any misapprehension about this thing. I thought there was a hint of criticism that the Bill did not go very far in this matter, and created only an experimental period, which is a sentiment I have heard before from the noble Viscount, Lord St. Davids. I just want to clear up the point where there seems to be some confusion of thought.

This Bill is intended only to alter the structure under which the waterways are worked and financed. It does not pretend to be a sort of cure-all for waterways ills. That is what I had in mind about further legislation. But it does not pretend to be that. The Bill is simply concerned with the structure under which the waterways shall work, and by which we hope they will work considerably better. It does not pretend to alter and amend general legislation relating to waterways, and that is the kind of thing I envisaged might well have to be considered in the future.

Amendment, by leave, withdrawn.

Clause 27 [Powers exercisable subject to Minister's consent]:

6.35 p.m.

LORD CHESHAM had given Notice of three Amendments to subsection (4), the first being, after "activity" to insert "or". The noble Lord said: My Lords, I would ask your Lordships' leave to speak to Nos. 23, 24, and 25 together, as they all hang together. Their purpose is to delete from subsection (4) of Clause 27 the express provision that a direction given by the Minister under the powers conferred by that clause may require a Board to abrogate a contract, even if in the process it commits a breach of contract. The reason that provision was put into the clause was that it was thought necessary to remove any doubt which might exist that a Board would be obliged to comply with a direction given by the Minister, even if such a breach of contract were committed.

I understand that a good deal of consideration was given to this point in another place, and that my right honourable friend was asked to reconsider the matter. That has been done. I am legally advised that in any case a Board would not be absolved from the obligation to comply with the Minister's direction under Clause 27 on the ground that they would commit a breach of contract of some kind by doing so. Therefore, my Lords, an express provision in the Bill is quite unnecessary, because it is merely declaratory of what is at present a general law. Not only is it unnecessary, but it is also undesirable, because there are other clauses in the Bill in which such a situation might arise, and, if there were an express provision in one clause and not in another, it might give rise to a feeling that there was some difference between them and that the position in one was not the same as the position in the other. Altogether, my Lords, since the matter is one of general law, and the position between the Board and the other party to a contract, if one were broken, is a matter for the general law, it would be much better and less confusing, if this express provision, as the Amendments provide, were deleted from the clause. I beg to move.

Amendment moved— Page 26, line 18, after ("activity") insert ("or").—(Lord Chesham.)


My Lords, I listened carefully, but I am still not clear. Could the noble Lord say whether it is a fact that the Minister can give instructions to a Board, and that the Board will have to carry out those instructions, even if, by carrying them out, the Board create a breach of contract?


Yes, my Lords, that is the position. If it were not so, it would be rather ridiculous to give the Minister a power of direction, and to depend a good deal on it, as one does in legislation of this kind, if a Board could then plead that they need not comply with it because they had entered into a contract.

Perhaps, if I make this further point it may help. What Clause 27 (3) does is to confer power for the Minister to give directions in circumstances where a Board propose to do something, or have done something, which requires his consent under the Bill. Where, through inadvertence, or for some other reason, they have not obtained such consent, or where the consent if obtained does not cover what they are doing, it would be quite wrong to plead that, because of a contract they could not comply with the Minister's direction. As I say, my Lords, that is a matter of general law and it does not require to be repealed in this clause. In fact, we are better off without it.

On Question, Amendment agreed to.


My Lords, I beg to move.

Amendment moved— Page 26, line 19, leave out from ("assets") to second ("and").—(Lord Chesham.)

On Question, Amendment agreed to.


My Lords, I beg to move.

Amendment moved— Page 26, line 21, leave out from ("loss") to end of line 22.—(Lord Chesham.)

On Question, Amendment agreed to.

Clause 28:

The Transport Holding Company

28.(7) It shall be the duty of the Holding Company to exercise its control over any wholly-owned subsidiary of the Holding Company so as to secure that the subsidiary does not engage in manufacture or production except the manufacture or production of things for use in their own business or for supply to a Board, or a wholly-owned subsidiary of any of the Boards or of the Holding Company, for use in their business.

6.42 p.m.

LORD SHEPHERD moved to leave out subsection (7) and to insert instead: (7) It shall be the duty of the Holding Company to exercise its control over any wholly-owned subsidiary of the Holding Company so as to secure within the limits of its powers, and within its existing operational areas, passenger and goods services adequate for industry, agriculture and the public.

The noble Lord said: My Lords, the noble Lord, Lord Mills, may feel that we are still treading the well-trodden ground of the Committee stage, because the principle behind this Amendment is one which I think has echoed right through our long debate, whether it has been on the Committee stage or on Second Reading, but this is perhaps the last occasion on which we can draw the Government's attention to what we regard as the very serious position which will arise following rail closures the extent of which few of us, I suppose, if any, can have any real idea.

The noble Lord, Lord Molson, who I regret is not here this afternoon, said on Committee stage [OFFICIAL REPORT, Vol. 240 (No. 81) col. 810]: … your Lordships should be absolutely assured that when a large number of stations and lines are closed down as a result of the rationalisation of British Railways, it will be possible for the Government to ensure that road services are provided in substitution for the rail service".

He then commented: Clearly, under the Bill it would be possible for the Minister to issue directions to the Holding Company to provide road services to take the place of uneconomic rail services. …

We have had both from the Minister of Transport in another place and, I fully admit, repeatedly from the noble Lord, Lord Mills, an assurance that when rail closures take place those closures will be carefully considered by the Transport Advisory Councils, and that on their report the Minister will decide whether a rail closure shall take place ox what alternative form of transport will be provided.

In regard to freight, we have the British Road Services, with its 16,000 vehicles—a figure which is limited by the 1953 Act. On the question of whether (and I hope the noble Lord, Lord Mills, can give us a reply on this from the information available) the number of vehicles now operating under "A" and "B" licences will be sufficient to meet the tonnage and the mileage involved following these major rail closures, I personally have some doubt. I think we fall top easily into the 9tate of feeling that we have more than sufficient road transport on the roads. Heaven knows!, when one sees the roads on a Friday and a Saturday one could well come to that conclusion, but the vast majority of those vehicles are in fact "C" licence vehicles which are merely carrying the merchandise of the owner of the vehicle. Therefore we have this position: that with these rail closures the Government must be satisfied (and, I would submit, must ensure) that there is an adequate road service, lorry service, to replace the railway capacity that will be affected by closure.

I should hope that with these closures we shall see develop other facilities to provide this capacity. We have the Holding Company operating British Road Services, but, as I said, it is restricted by numbers. During the Committee stage the noble Lord firmly said that it was not the Government's intention that the companies within the Holding Company should be radically developed. Therefore I believe that we shall be largely, if not entirely, dependent upon expansion within the sphere of the private operators. Can the noble Lord give us an assurance that in fact that will be carried out: that we shall see and can expect this development of road haulage to meet the rail closures?

Turning to the passenger services, here I think we have some similarity with the position of the London Board. In Clause 7 of this Bill the London Board are given directions, they are given the duty, to provide an adequate and properly coordinated system. The Government say that this has been necessary because the London Board will be in a monopoly position, but I am sure the noble Lord, Lord Mills, will agree that many of the bus companies that appear in the Schedules are in a similar monopoly position, in that they are the sole public carriers of passengers in their localities. It may well be that, for the time being, services will be adequate, but it is possible that these bus companies, taking into account profitability, may decide to reduce certain of their routes. As I see it from the Bill, the people affected by any reduction in bus services will have no means of stating their case and of bringing it before the Minister, because this clause which sets up the Transport Consultative Committees is related purely to the question of rail closures.

For example, let us take an area where there has been a severe rail closure, and where the Transport Consultative Committee have laid it down that certain bus services must be provided. Those bus services are therefore provided; but then the bus companies find it is not as profitable or as economic as they first thought, and decide to close some services down. I presume that those people who had an appeal to the Transport Consultative Committee on the occasion of the rail closures would not, if the bus services were reduced, in fact have an appeal against that reduction.

My Lords, it is a fact—the Minister has said it repeatedly in this House, and I will not quarrel with him—that these subsidiaries of the Holding Company must show benefit to the public purse. The Minister said on Committee stage that he could not imagine the Minister of Transport would issue directions to a subsidiary of the Board to carry out a service that was uneconomic. But I would refer him to paragraph 333 of the Annual Report of the British Transport Commission, in which the Scottish bus services state that their accounts at the end of the year were affected by operating uneconomic services, services which they were called upon to provide by the British Transport Commission because of rail closures. Are we to presume from that that, because their particular services are uneconomic, the Holding Company and the subsidiary will cancel them, will close down their service? If that is the case, what opportunity have the people in that particular area of making their case to the Minister?

My Lords, there is a good deal of concern right through this House. I was interested to see that the House had overwhelmingly defeated our first Amendment on the Report stage, to which, I think, two Members spoke on this side of the House, and the Minister on the other. But on the next Amendment, which was dealt with by the noble Earl, we had a whole series of noble Lords opposite getting up and making speeches which could well have been made on the first Amendment, echoing the fear that the areas affected by rail closures would not be—and they could not see that they would be—adequately covered by road transport.

There is much more to be said, but the hour is getting late. I would just ask the House to consider this Amendment. It lays upon the Holding Company one duty. It has no duty at present within the Bill in regard to service. It lays upon the Holding Company the duty to see that, within their limits and within their existing operational areas, they provide a passenger and goods service adequate for industry and agriculture. We are not asking that the Holding Company should go to the length and the breadth of the country to provide a service. We are asking that they shall provide what the Government lay down so far as the London Board is concerned: that they shall provide a service within their powers and within their operational areas. My Lords, I beg to move.

Amendment moved— Page 27, line 18, leave out subsection (7) and insert the said new subsection.—(Lord Shepherd.)

6.53 p.m.


My Lords, the noble Lord, Lord Shepherd, in moving this Amendment, has, I think, overlooked that it has two quite separate effects. The first is to leave out subsection (7) of Clause 28, which prevents the manufacturing output of any wholly-owned subsidiary of the Holding Company from being sold outside the nationalised transport structure. While the noble Lord has stressed the other effect, to which I will refer in a minute, I think I must draw his attention and the attention of your Lordships to the first effect.


My Lords, I think I can probably help the noble Lord, Lord Mills. I think there is a printing error here. It was not my intention to delete this subsection; it was merely to insert a new subsection in the form of the words printed on the Order Paper.


My Lords, I thank the noble Lord, but that is the effect of the Amendment as it stands on the Order Paper, so perhaps I need not spend the time in the first effect which otherwise I should feel compelled to do. We have debated a similar matter at great length, so perhaps I can go right to the second effect to which the noble Lord referred.

The main purpose of that Amendment is the same as was behind the proposed new clause to go in before Clause 1, which we discussed at length and which was negatived on a Division. It would, I suggest, be quite inconsistent with the concept of the Holding Company to place upon it any duty as regards adequacy of its transport services for public needs. As I have said, we debated this very fully when discussing the first Amendment proposed on Report. It would, I suggest, be quite inappropriate to subject the Holding Company subsidiaries to an overall control by the Holding Company, backed by a statutory duty to provide adequate services. Most of these companies are road haulage companies, bus companies, and shipping companies, and they are competing with other companies in private hands which would not be subject to any such obligations.

The noble Lord asked me whether the number of vehicles operating under "A" and "B" licences would be sufficient to meet the railway closures. I suggest that that is rather a hypothetical question, because the Commission does not yet know what the railway closures are going to be. But I am sure that we can expect development of the road services to meet any reasonable need, always having regard to the fact that the real test of the need is what the public are prepared to pay for, which point was emphasised in the Report of the Select Committee in another place.

I think the question of complaints in various localities about inadequacy of road services would be quite an easy one. It is easy for these transport Consultative Committees to make representations to the Minister and for people to make representations to them. The whole question of rail transport and bus transport, under conditions today, is really one, and I do not expect any difficulty in that regard.


My Lords, am I to understand from the noble Lord, Lord Mills, that these Transport Consultative Committees can receive a case from a local authority, or from any other responsible body, where, if they are dependent upon road transport, road transport becomes, in their view, inadequate for their needs?


As to the inadequacy of the transport services of which they complain, whether or not it be road transport. The noble Lord, I think, should bear in mind that at the present time the railways are paying quite a large sum of money out in subsidies for uneconomic services. I am sure the Minister has, and will continue to have, fully in mind this problem of transport as a whole; but it is a very different thing from laying upon the Holding Company the duty to see that its subsidiaries provide passenger and goods services adequate for industry, agriculture, and the public. The whole intention was to remove that conception, which has not been practicable for a long time, if it ever were. I see no difference betwen this and the proposal which the noble Lord envisages in his Amendment, which we discussed fully and negatived.

On Question, Amendment negatived.

Clause 30:

Distribution of Commission's assets

30.(6) Notwithstanding anything in the foregoing provisions of this section, there shall be transferred to—

the Railways Board,

the Docks Board,

the British Waterways Board, and

the Holding Company, the securities of the bodies listed in Parts I II, III and IV of the Fourth Schedule to this Act respectively (being securities beneficially owned by the Commission), and the rights and liabilities specified in Part V of that Schedule so, however, that where such securities are beneficially owned by the Commission, but held by a nominee, this subsection shall operate only to transfer the beneficial interest in the securities.

7.0 p.m.

LORD CHESHAM moved, after subsection (2) (d), to insert: ( ) the British Transport Commission Police Force,".

The noble Lord said: My Lords, I would ask your Lordships to consider with this Amendment, Amendments Nos. 65 to 71 and 81, all of which relate to the present Amendment.


My Lords, would it be in order, then, if I spoke to Amendments Nos. 65A to 65E, which are all relevant to the noble Lord's Amendments Nos. 65 to 71 inclusive?


Obviously, my Lords, there must be a general discussion on this. All these Amendments relate to the future of the present British Transport Commission Police Force. Your Lordships will remember that, when we discussed this question on Committee, several noble Lords wished this to remain as a unified force and I expressed sympathy with that view, offering to move other Amendments towards that end if the Amendments proposed in Committee were withdrawn. The Amendments have to be considered in the light of the present position of the B.T.C. Police Force. The force operate at present as a unified force, but this unification has no statutory background. The only power that exists is an enabling one.


My Lords, at the moment they are really under the control of B.T.C., which is the unifying body over all these Boards.


That is right. I am explaining, as a background to what is proposed in these Amendments, that no Statute says that the police force shall be unified. It is only the Commission which has decided this. The Bill has been drafted following the precedent of previous legislation, which gave enabling power to set up a police force. As the Bill stands now it would be open to any of the Boards to set up a separate police force.

Amendment No. 27 puts it beyond doubt that at the vesting date the British Transport Commission Police Force will be transferred en bloc as a unified organisation to the British Railways Board. At present the effect of Clause 30, to which the Amendment relates, might be to transfer those B.T.C. police, who are exclusively employed in connection with the services of any Board, to that Board and in this way the force would be automatically divided between the Boards. Therefore, the first Amendment makes certain that that cannot happen on the dissolution of the Commission and the distribution of its undertakings among the various new Boards. I am sure that your Lordships will agree that this is essential.

I have reason to believe that there is some resentment about being put under the Railways Board, but I think that this is the most sensible way of doing it. Until the time when the scheme envisaged in the later Amendments is prepared, the unified police force must have some kind of home, and it seems to me logical that this should be the Railways Board, because they are the biggest Board and the biggest users of transport police. The Railways Board would be their dwelling place until the scheme provided for in Amendment No. 65 is brought into operation and arrangements for joint control are set up. That provides for the permanent organisation of the police.

Briefly, the arrangement proposed is that the Railways Board, after consulting the other Boards, is under a duty to prepare and submit to the Minister within twelve months of vesting day a scheme for the organisation of the British Transport Commission police and that this scheme shall provide for a single unified force unless there is some overwhelming reason why there should be any element of it separate for one or more of the bodies. Having said that, I know from what was said in Committee that there may be some disapproval that the Minister should have any discretion whatsoever to approve a scheme which does not provide for a unified force. What is provided in this Amendment goes a good deal further than what I said in Committee, as I shall explain in a moment. I think it must be right that there should be some element of discretion in the matter.

It is not beyond the bounds of credibility that there might be some special case whereby one of the boards might establish good grounds—indeed, overwhelmingly good grounds—for having some separate force. Therefore, there should be a residual discretion for the Minister to approve a scheme which made provision for that. Unless there is some element of discretion left the decision about the organisation of the transport police will have been taken now without providing any opportunity whatsoever for the new Boards to express a view about the organisation they wish to see and think they need. If he does not mind my saying so, the Amendment proposed by my noble friend Lord Merrivale, about which we shall no doubt say more later on, does no more than pay lip service to this consultation and the discretion.

The point I want to emphasise is that by the terms of subsection (6)—that is, the terms that provide for the possibility of a separate police force for one of the Boards, only if there are special reasons—the whole emphasis of the clause has been tilted in the direction of continuing with a unified force on the present lines. I should like to read the words that have been redrafted in subsection (6): … and the Minister shall not approve a scheme under this section which provides for the organisation of transport police in more than one force unless it appears to him that there are special reasons for making it desirable. The direct onus is put on the Minister to do it in that way unless there is some overwhelmingly good reason to the contrary. That is going a good deal further than I went in Committee, as I said, and I should have thought that it moved quite considerably in the direction in which I agree many people wish it to go.

The point I want to make is this. Even if it is thought that that alone is not sufficient safeguard, there is an additional safeguard that even in the case of the Minister's being persuaded that there was a sufficiently outstandingly good reason for a separate force for one of the Boards, the ultimate decision would still lie with Parliament by way of the Negative Resolution procedure, which will apply to any Order the Minister may make to approve a police scheme. Therefore, there really is ample safeguard here for the existing British Transport Police Force as a unified force, while at the same time there is reasonable provision for the views of the new Boards to be taken into account before the final decision is made. That final decision, as I say, is now heavily tilted, and I am hoping that noble Lords will find that what we have done is adequate. As I said, it represents a considerable advance on safeguarding the position of the police as a unified force, particularly over the position that they are in now.

I am not going to refer to any of the other Amendments, Nos. 66 to 71 and No. 81, because they are largely consequential. They are certainly consequential on these main provisions, although no doubt a word or two of explanation on them will be required when they are moved. However, that is not necessary now and I beg to move Amendment No. 27.

Amendment moved— Page 30, line 5, after (" Executive ") insert the said words.—(Lord Chesham.)


My Lords, as my noble friend has spoken mainly and at length on Amendment No. 65, perhaps it would be convenient if I speak to Amendments Nos. 65A to 65E inclusive, as they are consequential on the Government's Amendment.


My Lords, if I may interrupt my noble friend, I am sure that that would be a good idea, but it may well be that when we reach those Amendments in the normal course of events it will be necessary to say a little more.


The Amendments to which I have just referred, in the names of my noble friend Lord Goschen, the noble Lord, Lord Shepherd and myself, constitute an attempt to modify the Government Amendments so that they may be more in keeping with the spirit of the Amendment which was so ably moved by my noble friend Lord Goschen on the Committee stage, and also to give a stronger effect to the words of my noble friend Lord Chesham when he said, on June 7 last [OFFICIAL REPORT, Vol. 241 (No. 92), col. 770]: … but it is intended that it should remain unified". My noble friend was speaking of the force. If we wish to maintain the present excellent esprit de corps which exists in this British Transport Commission Police Force and avoid opportunities for dispute with possible variations in conditions of service as between services rendered to the various Boards, then I feel that the Government's proposals need amending—that is, if we do not wish to destroy the continuity of the British Transport Commission Police Force. I would add here that the Police Federation strongly object to any breaking up of this nationwide force. As your Lordships know, it has well and truly proved itself in the past and it has only recently been reorganised to follow the recommendations of experts so as to improve efficiency and the general welfare of the force.

One of the important subsections of our Amendment during the Committee stage was that there should be on and after the vesting date a police authority. I think it can be fairly said that, so far as the police are concerned, the Government proposals would make the other Boards—that is, all Boards except the Railways Board—less autonomous and subject to the authority of the Railways Board. As my noble friend Lord Chesham said, during the interim period the British Transport Commission police would become the employees of the Railways Board. As I understand it, a scheme is to be prepared by the Railways Board which would mean that the force would still be mainly subject to the orders of the Railways Board, as they will be preparing the scheme. As I think my noble friend said, the Railways Board would be the largest user of these services. But is that a sufficient reason for making them in practice the sole arbiter of police policy?

Therefore, our Amendments to which I am referring propose that it shall be the Minister, after consultation with the Boards, who will prepare a scheme for the organisation of the transport policy under a police authority. That there shall be set up a police authority seems to me to be in keeping with the recommendations of the Final Report of the Royal Commission on the Police, Cmnd. Paper 1728, for paragraphs 152 to 228 are devoted to the functions, and so on, of police authorities. There would also appear to be a precedent for setting up a police authority such as we are seeking under these Amendments, if one considers paragraph 152 of the Report, which states that there are at present five or six different types of police authorities in existence. Paragraph 4 of the Report refers—without going into any detail, I admit—to the specialised constabularies associated with the Ministry of Aviation and the Atomic Energy Authority.

I would say that it was highly desirable to continue the existence of an individual unit as at present constituted. I know my noble friend referred to the safeguard in subsection (6), but to a number of us it still seems to constitute a certain loophole. I think, too, that this force should be submitted to the least possible disturbance throughout the coming reorganisation of the railways, docks, and so on, in the interests of security and efficiency. The problems of prevention and detection of crime on the railways, at the docks, at joint railways, London Transport Executive terminals and on the waterways, are closely interconnected, and their vulnerability to crime will still continue for years to come. As an example, if one considers the case of the export of goods from a manufacturer's siding by rail to the docks, this is a continuous process where maximum co-ordination of security measures is essential. Also it would seem to be quite impracticable that there should be any possibility whatever that under this Bill there could be a separate police force which would be dealing with inquiries along the lines—I am talking about railway lines—which are used jointly by the railways, London Transport Executive and the London Board.

In conclusion, I would ask your Lordships—although I am not moving the Amendment—to agree to certain principles Which are underlying our Amendments. These principles are that they seek to implement the recommendations of the Maxwell Committee so that the transport police force may feel, first, that their future is assured, that their promotional schemes will not be affected and that their proven machinery of negotiation will remain, and, lastly, confident that they may be in a position to afford the protection for which the transport police have been so effectively organised in the past.

7.25 p.m.


My Lords, I should have thought that all the principles for which the noble Lord, Lord Merrivale, has asked, and which I fully support, will be available under the Government's proposals. I think we are in a position of some unavoidable difficulty in that the noble Lord, Lord chesham, in moving Amendment No. 27 had very properly to refer to and explain to your Lordships—or discuss, at least—the other Amendments which occur later on. The noble Lord, Lord Merrivale, has been in rather a similar difficulty. If I might suggest it, I should have thought that our best course would be to accept Amendment No. 27 now and perhaps have a discussion when we come to particular points on other Amendments later on, otherwise by the time we get there the points will have been largely forgotten.

I do not say that this general discussion has not been necessary and desirable. So far as at least my own position is concerned, although I might find it possible to support one of the noble Lord's Amendments later on, I certainly could not support them all. It seems to me that the Government have conceded the main point, and I think the most important point of all, that there should be one force of transport police. Under the Amendments which have been moved and which will be moved, I do not think that can possibly be avoided. I was somewhat at a loss to hear the noble Lord, Lord Merrivale, say that you want the other forces to be autonomous. If you have one central force I do not see how the separate smaller forces can be autonomous. Surely, as the noble Lord, Lord Chesham, said, you must have one headquarters, one umbrella, and the Railways Board is the obvious choice for that. I cannot see that it makes a great amount of difference.


My Lords, the point I was trying to make was that the transport police feel that they would rather be under a separate authority than under the authority of the Railways Board.


That is precisely one of the points which I think, you cannot discuss as a single point in the kind of discussion we are now having, and I think it would be better to accept the Government's Amendment and deal with that particular point at a later stage.

Another point is that the Government say that the Railways Board shall submit a scheme to the Minister. The noble Lord will later say that the Minister should impose a scheme on the Railways Board. That is a matter for separate discussion. I would hope that we could accept the Government's Amendment now, make some progress, and perhaps have very brief discussions on particular points later on.


My Lords, I think that the best thing to do is actually what the noble Lord, Lord Stonham, has said. I think that the noble Lord, Lord Merrivale, and myself possibly are lucky because we can have two bites at the cherry. I do not think, as a matter of fact, that there is really a great deal between the Government and ourselves on this. There is one main point, which I think would probably be better brought out when we go on with the other Amendment.


My Lords, I agree entirely with what has been said by both noble Lords, that this is the way to do it. Of course the noble Lord, Lord Merrivale, is quite right; I told a good deal of my story and he wanted to tell some of his. I am sure he will not expect me at this stage to reply to what he said and start a general debate that might last all the evening. I think it is perfectly right that we should do what has been suggested. Therefore all I can say is that I hope noble Lords will at least feel that this Amendment No. 27 is necessary and will accept it.

On Question, Amendment agreed to.


My Lords, I think this might be a convenient moment to adjourn for dinner until 8.30.

The Sitting was suspended at twenty-eight minutes before eight o'clock and resumed at half-past eight o'clock.

LORD TEYNHAM moved, in subsection (6), to leave out "being securities" and to insert "so far as". The noble Lord said: My Lords, perhaps with the permission of the House Amendments Nos. 28 and 29 and the consequential Amendments to the Fourth Schedule, Nos. 82 to 88 and 90 could be taken together. Unfortunately, the noble Earl, Lord Swinton, who was going to support me on this Amendment, is unable to be here this evening. These Amendments are similar to those set down during the Committee stage of the Bill. As the Bill is drawn the partnership between the principal provincial bus companies and the railways will be impaired in fact, if not destroyed, if the shares now held by the Transport Commission are to pass to a Holding Company divorced from any railway operating interest. If these Amendments I have set down are not accepted, I would say the very real benefits to the (travailing public of road-rail co-ordination over the years since 1928 will be removed.

If your Lordships will turn to Clause 3 (2) of the Bill, it will be found that the Railways Board is directed thereby to co-operate with the London Board and co-ordinate their services; and again in Clause 7 (2) it is said that the London Board shall co-operate with the Railways Board. Surely it is just as necessary that co-ordination should continue between the Railway Boards and bus companies throughout the country and not just with the London Board. The proposal in the Bill to transfer the railway holdings of bus shares to the Holding Company is, I maintain, a retrograde step and, what is more, unbusinesslike, and will be against the public interest.

I would add that financially it does not matter one way or the other to the provincial bus companies. I think it was the noble Lord, Lord Mills, who said during the Committee stage of this Bill that the existing partnership between the railways and bus interests will not be destroyed. The fact remains that the financial partnership, I would say the investment of money, in a common venture, will be destroyed. It has also been suggested, I think, by Her Majesty's Government that the Railway Boards must be left free to concentrate on running railways, but under the Bill the long-standing partnership between municipal authorities such as we have in Huddersfield and Sheffield, and elsewhere, is to be continued. There really is no consistency in this Bill at all. Why maintain railway co-ordination with municipal bus interests and destroy it in the case of others? I suggest to your Lordships that the more railway lines are closed the more important it will become for the railways to improve coordination with the bus interests for the convenience of the public.

There is one other important point I should like to make. I wonder how many of your Lordships are aware that the parent agreement made in 1930 between one of the most important provincial companies—and it is still in existence; and many agreements are the same—and the railways reads as follows: If at any time the railway company or the traction company shall desire to dispose of any shares in any of the subsidiary companies the party so desiring to dispose of its shares shall before doing so offer the same to the other party ".

I think I need hardly say any more on this point, because I feel sure it must be perfectly clear to your Lordships. I beg to move.

Amendment moved— Page 30, line 34, leave out ("being securities") and insert ("so far as").—(Lord Teynham.)

8.35 p.m.


My Lords, this question has been widely canvassed in another place and by letters to Members of Parliament, so one must assume that there is either something in it, or a great desire to leave things as they are. This goes back to the 1928 Railway Road Transport Acts, when each of the four main railway companies secured powers to carry passengers and goods by road. These Acts also empowered the railway companies to enter into working agreements with the bus companies and local authority bus undertakings, and, similarly, authorised the railway companies to hold shares in the bus companies. The result was an arrangement whereby the railway companies made an agreement with Tillings and the Scottish bus companies and the British Electric Traction Company to take over shares in these companies. Ultimately, Tillings and the Scottish bus companies became wholly-owned subsidiaries of the railway companies.

It is said that it is essential that the railway companies should retain their shareholding with the bus companies in order to bring about the co-ordination necessary between the bus companies and the railway companies. But the co-operation does not depend upon the financial holdings; it depends upon the parent and working agreements between the railways and the bus companies of the British Electric Traction Company, Tillings and the Scottish Omnibus Groups. That is what ensures proper co-operation. It is true that the railway companies have appointed directors to the various bus companies, but the actual control has remained with the British Electric Traction Company, except for Tillings and the Scottish Omnibus Groups. I am the last to say that the British Electric Traction Company, who really have control of these companies, have not done a good job, but I do say that there is no harm—in fact, there may be good—in the owners of the shares, in the public interest, being a little closer to their responsibility in this matter.

These working agreements are the nub of the matter; and when it comes to the directors of the bus companies it is perhaps better that they should be people who have knowledge of running bus undertakings rather than of running railway undertakings. The result of the association has been that the bus companies have largely been run by people concerned with the bus companies. I have no quarrel with that. But I maintain that it is essential, if the Government interest in seeing that these bus companies do the job that is allocated to them is to be properly catered for, that the holders of the Government shares must be active in this matter. The railways have a very great job to do, and it has been our care and our anxiety to see that they are not distracted from their job. That was our difficulty with the British Transport Commission: they had far too much to do. They had far too many jobs imposed on them, one of which was this problem of the bus companies; and to pass it over to the railway companies, to make them responsible by a financial interest, does not, I think, make very much sense.

It is true that they are responsible for the working arrangements of the bus companies. That does make sense, and there are advisory committees on this problem. But I believe that to saddle the railway companies with this job, to say to them: "This is your responsibility, and only your responsibility," would bring us back to exactly the condition which we have been trying to avoid in regard to the responsibilities placed upon the British Transport Commission. There are proper working arrangements; there are advisory committees. AH of that can go on. In fact, the Bill expressly gives the powers for those agreements to be continued. I see no virtue in this Amendment, which requires the shares in the British Electric Traction Group held by the Commission to be transferred to the railways, and to divide the shares in Tillings and the Scottish Omnibus Groups between the Holding Company and the Railways Board.

I think that that last suggestion really gives the key to the whole situation: it is an endeavour to hang on to something which has caused no trouble to the British Electric Traction Company. In my view, however, the public interest demands that we should go forward with our proposal to transfer these shares to the Holding Company. The Holding Company will then be compelled to take an interest, which they should do. In the past the British Transport Commission have always had far too much on their plate to enable them to do so. My Lords, I suggest that we do not support this Amendment.

8.44 p.m.


My Lords, I wish that Her Majesty's Government would be a little more forward-thinking. I cannot help feeling that they are living in the past in this matter, whereas we are entering upon a new era of transport. All the old shibboleths, all the old ideas, are now out of date. For years the road buses and rail were rivals. To-day, the rivals are road buses plus rail against the private vehicles we all own. Transport is now so proliferated that we see huge losses on the rail, we see growing losses on some of the bus lines, and those losses may extend into the more favoured routes. Meanwhile, to some extent the buses continue to erode the rail, and both are eroded by privately-owned vehicles.

I submit that the time has arrived when the buses and the rail must get together and work towards a streamlining and a co-ordination of their passenger-carrying capacity all over this country. The 1947 Act was intended to work in this way, but, of course, the task in those days was really too big for any man, particularly as it had to embrace goods as well. Therefore the coordination was very limited and in a very small field. Through the ownership of the bus shares by the Commission there was a degree of co-ordination. To-day the need is for more co-operation and more co-ordination and not less; yet, the structure that Her Majesty's Government visualise is, to my mind, inevitably tending towards less rather than more.

There is going to be more closing of rails and more taking over of routes by buses, where they can carry at a higher profit. Surely, the criterion here is: which method of transport can offer a reasonable service to the public at the lowest possible cost price? That criterion can best be satisfied when the profits of the buses in whole or in part accrue to the railways. Judgment can best be given when both parties have a financial stake. The question is: are the railways to get this done by partnership and agreement, or by running their own buses and adding to the taxpayers' loss? At the same time, rationalisation is not a one-way exercise. In due course, as private motor transport increases still further, there may be closing of bus routes where the rail can carry at a lower cost and a higher profit than the road can offer. Here, again, decisions can be made only round the boardroom tables of the bus companies. In face of the common enemy, which is the private car that we all own, the buses and the rail must get more together and not less together.

The Minister seemed to think that this can happen if the Holding Company owns the bus shares, but how can it? The railways will have no interest. Their interest will be to cling on to every route, marginal though it may be, till the last possible minute; whereas, under partnership at an early stage they can say to a bus company: "What is your cost to run this route?". If it is cheaper than rail, they can mutually decide to turn over to bus, and in some cases vice versa. Under our Amendments the railway would get up to half the profit from the B.E.T. group of companies, and all the profit from Tillings and Scottish Motor Traction. I submit that under the Holding Company régime the buses and the rail will operate as commercial rivals, in competition regulated only by the withholding or the giving of licences by the traffic commissioners. This may be in accordance with the doctrine of the greatest competition making for the greatest benefit to the consumer, but when the consumer himself is contracting out of the services of both competitors by producing his own vehicles, leaving the road and rail services to handle the residue, then the situation is different. When we get to this state of affairs, I submit that it is time for the road and rail to get together to avoid disastrous losses; and since the consumer pays the losses in the end, I submit that that would be to his ultimate advantage.

I have the greatest respect for the way in which the energy of the Minister is being directed to speeding up the traffic in London, but I wish that he could do a little more forward-thinking in this matter. We all sympathise with Dr. Beeching in his monumental task, in which we all wish him well; and, though it must be quite alien to his business philosophy to own businesses and to half-own businesses where, for the moment, he has not the power to exercise much control, yet in this case he has strong and effective direction as his partner; and in time—in time, my Lords—he will have more opportunity to assent his due weight.

I would also remind your Lordships, in this connection, that Dr. Beeching himself is to be asked to sit upon the Transport Advisory Committee. If that Committee is going to do its job and adjudicate on countless transport problems all over the country, then Dr. Beeching, the kingpin of the lot, is going to be very heavily engaged on a job outside his own railway job—what he considers his railway job; what we consider should be the job of the railway chief—in co-ordinating the two. Meanwhile, the immediate hiatus re-resulting from the withdrawal of uneconomic rail services will be much more easily filled if the railways own the bus shares. I emphasise again that the problem of the future is to decide who can provide an adequate passenger service at the lowest cost. That is the criterion, and I believe that the problem can beat be solved by continuing the long-standing partnership that exists at this moment.

8.52 p.m.


My Lords, I have heard it said that honesty is the best policy, so perhaps I had better "come clean". I do not like supporting the Government. It is somewhat difficult for me, with my general make-up, to do so. But when I see the noble Lords, Lord Hawke and Lord Teynham, praising the 1947 Act and talking about bus and rail services getting together; saying that co-ordination and co-operation are what is needed; that the Holding Company would be wrong to act as commercial rivals and that it is time we got together, I begin to get a little suspicious, and I want to know what it is all about.


Did I not explain to the House that we are entering on a new era?


But we have been on this Bill for a very long while. I have been trying to convert noble Lords to the way of thinking that this is the era, and that they ought to turn this Bill out. They cannot have it both ways. The last thing I should wish to do would be to put words into the mouth of the noble Lord, Lord Mills.


You could not do it if you tried.


Perhaps I could not, but I do not want to attribute to him things which he did not say. However, the impression the noble Lord, Lord Mills, made on me during his speech was that there was a vested interest behind this Amendment—I put it no higher than that.

I must say, looking at the matter as a transport worker and as a railway man, that I did not see some of this cooperation about which the noble Lord, Lord Hawke, spoke just now. If I remember rightly (I think I am right, but if I am wrong then perhaps the noble Lord, Lord Hawke, or the noble Lord, Lord Teynham, will correct me). Midland Red are part of the B.E.T. But their co-operation was not very evident on the London-Birmingham route. Again speaking subject to correction, I believe that the railways, although they were part-holders, opposed their licence. They fought like blazes for it; and they, with the Minister of Transport and the M.1, have been very serious competitors to both the Western Region and the Midland Region on the two-hour London-Birmingham run. My Lords, I think it is only fair to say that if, in fact, it came to a Division, then I should be prepared to co-operate with my colleagues in going into the Division Lobby in support of the Government on this matter.

8.55 p.m.


My Lords, I do not know whether the House wishes me to speak. It has been a short debate, but I should like to say this to my noble friends. I have heard many Amendments proposed in this House, and both speeches in support of this Amendment were admirably concise and admirably lucid. But I have never heard two speeches which more utterly destroyed one another than the speech made by my noble friend Lord Teynham, in proposing the Amendment, and the speech made by my noble friend Lord Hawke in supporting him. The whole burden of the case of my noble friend Lord Teynham was that the agreements which had worked so well for 40 years, or whatever the time between 1928 and the present may be (at this late hour it is rather difficult to do sums in one's head), and which have lasted for so long, should not be disturbed because they were going so well. On the other hand, my noble friend Lord Hawke said that the Government are living in the past; that we must look forward. He said that we were entering upon a new era. I do not know which of these two positions is right; what I do know is that they will not live together. It seems to me unnecessary to stress the inconsistency between these two basic positions.

The real point about this is really relatively simple. Somehow it has entered into my noble friends' heads, for reasons which are quite incompatible with one another, that co-ordination between road and rail in the matter of passenger services depends on the interlocking shareholdings which date from the year 1928, when the railway companies, offended by the bus companies' competition, began to purchase large blocks of bus company shares which have since come down to the British Transport Commission by a series of devolutionary processes. I rather sympathised with my noble friend Lord Teynham when he read out from one of the parent agreements from 1928 the provision that if any one concern tried to sell their shares they should first offer them to the other party. But, of course, this has not happened. This is all water over the dam of the Nationalisation Act, 1948, and we are having to decide what happens to them now. The blunt fact is that the interlocking shareholdings have absolutely nothing to do with the day-to-day and modern co-ordination in the new era at all.

Both noble Lords who supported the Amendment referred to the need for coordination when the lines are closed under our scheme. But, of course, the machinery which has been worked out by my right honourable friend the Minister, and by the Bill, for that coordination has nothing whatever to do with the interlocking shareholdings. The new Railways Board will not be able to close a line; they can only ask for it to be closed down. Their proposal will then be examined by the Transport Users' Consultative Committees, who will consider the question of hardship. They will make recommendations, either for closure, or for alternative services. The Minister will then decide whether to keep the railway line open, whether to close the railway line with no alternative services, or whether to close it with alternative services. It will not be decided by the shareholders, either by the Holding Company or by the B.E.T., however much the B.E.T. might desire the Minister to do it.


Would my noble friend forgive me for interrupting? Surely the shareholders, which will be the railways, would be much more interested in putting forward a scheme for closure in order that the thing should be more profitably operated by bus, and vice versa, if they had a financial interest in the final return.


My Lords, the railways will put down a scheme for closure when they think that a railway service is not paying. It does not have anything to do with the interests of the bus companies at all. The Minister may decide, if 25 people suffer hardship, that there will be an alternative service. The railways will then have to buy a service from the bus company or, if it cannot provide it, the railways must provide their own. There is nothing in that coordination which depends upon interlocking shareholding, which dates from 1928. The rest of the matter has already been dealt with by my noble friend. The co-ordination which will exist in the new era, into which my noble friend Lord Hawke is obviously looking forward, will depend partly upon the Advisory Committee advising the Minister and partly upon existing working and parent agreements. These things will go on upon the basis on which co-ordination always goes on—common interests, good will and appropriate machinery. All these are creating co-ordination at that level.

Nobody has suggested, though I suppose it is just as important in its own way, that there should be co-ordination between railways and shipping companies or railways and inland waterways or railways and docks. Nobody is suggesting in those cases that there should be a series of interlocking shareholdings to guarantee co-ordination. On the contrary, there is ample co-operation as it is, based on common interests and appropriate machinery which already exists. What may be irking some of those who have been so persistent in their desire to pursue this Amendment—because it was put down and beaten in the Commons on Committee stage, put down and not selected on Report stage, put down and beaten in Committee stage in your Lordships' House and now put down again on Report stage—is that the co-operation, for which I am as ardent an advocate at least as some of my friends, has not always worked out extremely happily for the railways. One instance has been mentioned by the noble Lord, Lord Lindgren. The railways, under any integrating shareholding arrangement must either be effective, which means taking a proper share in the management, or take a nominal interest in the proceedings and not be effective. One is bound to say that they have opted consistently for the second of the two alternatives.

At present a B.E.T. nominee is char-man in every case as a result of interlocking shareholding. This is what interlocking means in practice. Out of a total of 54 places to which the B.E.T. nominate directors, 51 are shared between 10 men. The B.T.C. representation is widely spread over a large number of people, most of whom occupy posts which localise their interests. B.E.T. nominees are also able to give, and are no doubt expected to give, the major proportion of their time to the various affairs of the bus companies, whereas the time of the B.T.C. representatives is occupied by many of their responsibilities as members of the Commission's staff. It is true, of course, as the noble Lord, Lord Lindgren, pointed out, that where there has been a direct conflict of interest the B.E.T. had no compunction, despite interlocking shareholdings, in running rival services to Birmingham. One wonders what would have happened if it had worked the other way.

All I can say is that this Amendment runs completely contrary to one of the main purposes of the Bill, which is to make the business of the nationalised railways manageable by enabling the Railways Board to concentrate on this job to the exclusion of others. This is at present true of shipping companies and there is no reason why it should not be true of bus companies, too. One thing is quite certain, whatever the fate of this Amendment—the Holding Company, as I hope it will be, or the Railways Board, as it will be if my noble friend has his way, are not going to take quite so supine an interest in the bus companies as they have done hitherto.


My Lords, before my noble Leader sits down, may I ask whether he maintains that the Holding Company will, through their shareholdings, force the bus companies to withdraw the services which compete unduly with the railways?


Not in the least. On the contrary, we hope to take the vigorous part in the management of these things which our shareholding entitles us to do.

9.5 p.m.


My Lords, I was one of those who on the Committee stage supported the noble Lord, Lord Teynham, and I will be quite frank and say that I did so because right through the Second Reading and the Committee stage (the noble Lord, Lord Mills, will agree with this) I took the line that there did not appear to be any degree of co-ordination between the railways, the docks and the Holding Company. I saw in the Amendment moved by the noble Lord, Lord Teynham, at least an opportunity of some form of coordination between the bus companies and the railways.

But since we had (the discussion on that Amendment we have had some advance on Clause 54 of the Bill, in which the Minister has, from my point of view, strengthened the purposes of the nationalised Transport Advisory Council. He met us practically the whole way, except on the word "advisory". As I now understand it, this Advisory Council will be a strong Council, and its main effort will be to provide the co-ordination that we on this side of the House require. If the Minister can say that this Council will in fact be a live, virile organisation for co-ordinating the efforts of rail and road within the nationalised bodies to provide within their limits the service to the community, then I, for my part, will be content, and I would advise my noble friends to support the Government in this issue, even though it reverses what we did on the Committee stage. Times have changed, and we have had the gesture from the Government in regard to Clause 54.


My Lords, with the leave of the House, I should like to say that on Clause 54 we accepted the proposal. We recognised that this was a top body dealing with transport as a whole. Therefore, I have no difficulty in giving the assurance. While I am on my feet, I should like to apologise to the House. We have all been talking on Amendment No. 29, but before that there is Amendment No. 28, a drafting Amendment that I am able to accept.


We have actually been talking on Amendment No. 28.


I accept that correction; but the discussion was more suitable to Amendment No. 29.


Amendment No. 28 is accepted by the Government, and perhaps the noble Lord, Lord Teynham, will move No. 29 formally if he wishes to pursue the matter. I will put the Question on Amendment No. 28 first.

On Question, Amendment agreed to.


My Lords, I beg to move Amendment No. 29.

Amendment moved— Page 30, line 36, after ("Schedule") insert ("and to the Railways Board and the Holding Company in equal shares the securities of the bodies listed in Part (The Railways Board and Holding Company Shared List) of that Schedule,").—(Lord Teynham.)


My Lords, I take it that all the arguments that your Lordships have just enjoyed are to be held to apply to Amendment No. 29, and the noble Lord, Lord

Teynham, can now indicate to the House whether he wishes to withdraw that Amendment or to pursue it.


My Lords, with all due respect, I must say that I am not very impressed by the arguments put forward by the noble and learned Viscount, Lord Hailsham. I also feel that the case put forward by the noble Lord, Lord Mills, is rather a weak one. He brought out again the question of the railways being distracted from their job. That really does not hold water. When I think that only two representatives for the railways sit on the boards of these provincial bus companies for a couple of hours once every two months, I cannot feel they are distracted. Then the noble Lord, Lord Mills, again made the extraordinary statement, to my mind, that the British Electric Traction Company wishes everything to remain as it is, for some reason or other, and I presume he means a vested reason. I have already pointed out to your Lordships that the provincial bus companies do not benefit financially one way or the other, and neither do they increase or decrease their control. I really cannot see that point of view put forward by the noble Lord, Lord Mills, at all. I feel very strongly about this Amendment, and I feel I must press it.

On Question, Whether the said Amendment shall be agreed to?

Their Lordships divided: Contents, 8; Not-Contents, 46.

Fraser of North Cape, L. Long, V. Teynham. L. [Teller.]
Geddes, L. Runciman of Doxford, V. Waleran, L.
Hawke, L. [Teller.] Somers, L.
Albemarle. E. Devonshire, D. McCorquodale of Newton, L.
Ampthill, L. Forster of Harraby. L. Massereene and Ferrard, V.
Auckland. L. Furness, V. Mills, L.
Bathurst. E. Goschen, V. Molson, L.
Bossom, L. Grenfell, L. Newall. L.
Brecon. L. Hailsham. V. (L. President.) Newton. L. [Teller.]
Carrington, L. Hastings, L. St. Aldwyn. E. [Teller.]
Champion. L. Henderson, L. St. Davids, V.
Chesham, L. Horsbrugh, B. St. Oswald, L.
Coutanche, L. Jellicoe, E. Sandys, L.
Craigmyle. L. Kilmuir. V. (L. Chancellor.) Shepherd. L.
Crathorne, L. Lansdowne, M. Stonham, L.
Croft. L. Lindgrcn. L. Strabolgi. L.
Crook. L. Lothian. M. Walston, L.
Denham, L. Lucan, E. Westwood, L.
Derwent, L.
Resolved in the negative, and Amendment disagreed to accordingly.

Clause 39 [Railways Board's suspended debt]:

9.20 p.m.

LORD MILLS moved, after subsection (2), to insert: ( ) For the purposes of the last foregoing subsection any securties which vest in the Railways Board under this Part of this Act shall be treated as if they were assets created by the Commission since the end of the year nineteen hundred and fifty-five.

The noble Lord said: The purpose of this Amendment is to cure a defect in the criterion set out in Clause 39 for deciding the amount of the Railways Board's suspended debt. Subsection (2) of the clause defines the way in which the suspended debt is to be calculated. It is to be part of the commencing capital debt of the Railways Board which, in the opinion of the Minister, is not represented by the written-down book value of the assets which have been created by the Commission since the end of 1955 and which vest in the Railways Board.

The subsection has been drafted in terms appropriate to physical assets. But in fact the assets passing to the Railways Board will include shareholdings in various companies, the most important of these being the Hotel Company which is to be set up under Clause 32. We are advised that the present wording is not apt in relation to these assets. So it is the intention that any securities which vest in the Railways Board shall be treated as if they were assets created by the Commission since the end of 1955. The securities to be vested in the Railways Board under subsection (6) of Clause 30 relate to bodies listed in Part I of the Fourth Schedule to the Bill. These assets are quite different in nature from the old pre-1956 railway assets, and it was not intended that assets such as these should be treated as railway assets for suspended debt purposes. The bodies to which these assets relate, being incorporated, are by definition somewhat apart from the railway undertaking as ordinarily understood and there is good reason to treat these assets as a class separate from the railways. So that any assets being transferred which consist of securities will be treated as interest-bearing debt. I beg to move.

Amendment moved— Page 40, line 22, at end insert the said subsection.—(Lord Mills.)

On Question, Amendment agreed to.

Clause 42:

Charges and facilities: general provisions


(3) Subject to this Act and to any such enactment as is mentioned in the last foregoing subsection, the Boards shall have power to demand, take and recover such charges for their services and facilities, and to make the use of those services and facilities subject to such terms and conditions, as they think fit.

9.24 p.m.

LORD CHORLEY moved, in subsection (3), after "Boards" to insert: "other than the British Waterways Board". The noble Lord said: My Lords, this Amendment is preliminary to the following one. In order that we may not have the same difficulty that we had a few minutes ago in connection with Nos. 28 and 29, perhaps your Lordships will allow me to speak to No. 32 at the same time. I ought perhaps to begin by explaining that this is the first of a small series of Amendments devoted to some aspects of this Bill in which the National Trust is interested, either directly or indirectly. How the National Trust came to be interested in this Bill was, I think, sufficiently explained at the last stage, when the work of the Trust, particularly in connection with the Stratford Canal, was referred to on a number of occasions, and I think much commended by everybody who mentioned it; so there is no further need to go into that.

I should. however, explain that we at the Trust are greatly indebted to the noble Viscount, Lord St. Davids, for bringing before us the implications of some of the clauses in this Bill. At face value, these canal clauses appear to be perfectly harmless. Indeed, the noble Lord, Lord Chesham, spent quite a little time on the last stage protesting that they are all quite harmless. It reminded me of the lady in one of Shakespeare's plays who was alleged to have protested too much. It was really only during the Committee stage of the Bill that the implications of these clauses became clear to us at the National Trust. No doubt one of the great advantages of a Committee stage on a difficult and complicated Bill of this kind is that the detailed discussions which ensue bring out hidden aspects of the legislation and enable mistakes which might otherwise have been made to be put right. Unfortunately, the mistakes were not put right at that stage, but we are hoping to get them put right now.

In the interval since then, we have been able to investigate this matter a great deal more and to give the whole business a detailed examination, in particular to consider carefully the speeches of the noble Lord, Lord Chesham, as indeed he invited us to do. I must confess that in the result, instead of being in any way satisfied or feeling secure, we are much more disturbed than we were, and we have really begun to doubt whether the Ministers themselves understand all the implications of their own Bill in respect of this set of canal clauses. These Amendments have therefore been put down in the name of the noble Earl, Lord Crawford and Balcarres, who is the Chairman of the Executive Committee of the Trust, and in the names of the noble and learned Lord, Lord Cones-ford, and myself, who are members of the Executive Committee; and I am glad to say that the noble Viscount, Lord St. Davids, whose interest in these problems has been made manifest to the House on a number of occasions, and particularly on the last stage, has also signified his support for them.

In these first Amendments the Trust is rather less directly interested than in the others. Of course they are concerned with the reasonableness of the charges to be made for the use of the facilities provided by the Waterways Board. As your Lordships appreciate, the Bill as it stands gives them carte blanche to fix any charges at their discretion. Of course, the National Trust is not directly concerned with charges in this way—it does not carry merchandise or anything of that kind. Therefore, no doubt it will be argued that it is quite apart altogether from the interests of the Trust. That really is not so. Apart from the fact that this is a matter of considerable importance and public interest, the answer is that unreasonable charges may drive the traffic off the canals altogether. Indeed, I regret to say that among many people there is a good deal of suspicion that one of the objects of giving the power to charge any rate that they like is deliberately for that particular purpose. It has been known in the past, in connection with commercial firms, for power of that sort to be used.

One does not expect an attitude of that kind from a public body, and I am not in any way alleging that that is so. I just do not know. But the management of these canals has been a very tiresome and frustrating business for a good number of years, involving great expense, and it is not impossible that some of those who have been concerned have got into a frustrated state of mind when they would be prepared, or might be driven, to make use of a weapon of this kind if it were put into their hands. It is a weapon that is altogether too powerful to be entrusted to someone without any right of appeal. That is what it comes to, and that is the danger of it as it stands at the present time.

In their own way, some of the things which have already occurred in relation to the canals remind one a little of Critchel Down. But for the persistence of one individual in that case it might very well be that a great wrong would have been done. It may in the end appear that the persistence of the noble Viscount, Lord St. Davids, is something of the same kind. But I am not really concerned whether there is any deliberate intention to do this or not. If undue charges are imposed, the result will be exactly the same, unless, of course, there is some possibility of appeal. The Amendment so provides, by stipulating that the charges must be reasonable. In the past that has been the way in which this matter has been handled.

My Lords, it must be remembered that the rights enjoyed by the public in regard to these canals are of very old standing. Rights to use the canals and in a number of cases to be charged not more than the tolls are specified in certain Acts of Parliament, or under the railway Acts, and the amounts mentioned therein are reasonable amounts. These, as I have said, are very old-standing rights, and it is astonishing to me that there should now be this proposal to sweep them all aside in this Bill without there having been a great deal more public indignation about it. They go back into the middle of the 18th century, from which time these rights have existed. There was a great argument on the Committee stage as to whether they were rights in the nature of those on a public highway or whether they were statutory rights under Acts of Parliament. I do not want to go into that matter. I have looked at several cases in which the Court of Appeal, for example, have stated that they are Common Law rights. But whether they are Common Law rights or statutory rights, it is perfectly clear that in very many of these cases people have a right to go on to the canals and to navigate, whether carrying merchandise or not, and to do so on the basis of paying reasonable tolls. Indeed, in some cases the Court has laid it down that Acts of Parliament give them a free right to use the canals without paying tolls at all—in effect, equating the canals with a highroad along which people have a right to pass backwards and forwards without making any payment of tolls.

Therefore, I contend that the implications of the present Bill are very important and almost revolutionary, because to a large extent the British canal system is an interlocking one; it is in fact a statutorily interlocking system. It is not just a question of preserving wide canals, as was stated in some speeches on Second Reading. But because the system is an interlocking one, it cannot be destroyed at some points without irreparable damage to the system as a whole.

The canals are very closly interconnected with each other. If water fails at one point, for some reason such as the noble Viscount, Lord St. Davids, mentioned in his Second Reading speech, it may often be supplied from another, and in many cases it is a statutory duty that it should be supplied. More important still, the right to enter a canal from some other canal is always provided for, and it is in matters of this sort that the National Trust with its Stratford section of the canal is very interested indeed. However successful it may be in preserving this stretch and, possibly, other stretches of interest to the boating and fishing sections of the community, they will not be of anything like the same value if they are short, unconnected stretches, as a result of the operation of this Bill and the right to impose any sort of charges which it at present contains.

The noble Viscount, Lord St. Davids, tried to get over this at the Committee stage by moving an Amendment which provided for a very detailed set of charges. One could very well agree with the view, which was very forcibly put by the noble Lord, Lord Chesham, that this was a "two-acre" Amendment, and altogether too detailed to be satisfactory at the present time. He was, of course, following the method which was usually adopted in all the older Acts. But I for one quite agree that the method of insisting upon a reasonable set of tolls is a much more satisfactory way of doing it, particularly as, of course, the English law is very well adapted to deciding what is or is not a reasonable charge in a given set of circumstances.

This has been going on for a very long time, not only in connection with canals but in connection with all sorts of other charges—freightage charges of all kinds—in very many connections. It is much better that that well-tried method of dealing with this sort of system should be carried into this Bill, rather than that the new and completely revolutionary outlook which it at present contains should be adopted. It may be justifiable in regard to the railways, where the situation is very different, where there is now—as we have heard so often—the most intensive competition from road haulage. I am not concerned to argue that point; it may well be so. But what I do know, and what has indeed been made very clear during the course of these debates, is that the canal system provides what are, in effect, highways on which barge owners, pleasure boat owners and all sorts of other people have a legal right. It may be that in some cases the pleasure boat owners do not have a legal right, but in very many other cases they quite clearly have. This afternoon I looked at several cases which have been before the courts, in which the courts have laid it down perfectly clearly that on some canals, at any rate, pleasure boat owners have a right to put their boats and to sail about in them.

From the Middle Ages onwards, the Common Law has required that public or common carriers should charge reasonably. That is a very basic principle of the law in relation to these matters, as the noble and learned Viscount on the Woolsack can underline if he will do so. Indeed, there was a time when carriers were prosecuted in criminal cases, for overcharging in regard to the carriage of merchandise along the roads—and along the canals, too, for that matter. Therefore, I think I am absolutely right in contending that the powers taken in this Bill to charge at discretion are quite revolutionary, and they arc revolutionary in what I suggest is a thoroughly objectionable way, because they enable the Board, against whose decisions there is no appeal at all as the Bill stands, to deprive by this side wind (because that is what it is, a side wind) of charging excessive tolls the users of the canals of the rights which have been conferred upon them either at Common Law or by the terms of Acts of Parliament. Indeed, my information is that the Transport Commission have already begun to anticipate the rights which the new Board are taking under this Bill by purporting to impose conditions which I should have thought, under the law as it stands at present, were clearly illegal.

I am told that the pleasure boat proprietors, who are granted licences, are required to give un their rights, and that on the back of these licences there are endorsed statements to the effect that the public shall travel at their own risk as to life and limb, loss, damage or delay, however caused, including negligence by the Commission".

This is flatly contradictory to the law as laid down by the Court of Appeal, and I should have thought that an injunction would have lain against them for so doing. If this is the spirit in which this Act is to be administered and these charges are to be formulated, I should have said we were quite obviously going to have a whole series of charges which are not reasonable in the circumstances, and that we cannot really expect the Bill to be properly and reasonably administered.

The noble Lord, Lord Chesham, has recognised that, under the existing law, there are statutory rights of navigation on all these canals, I think, and he has admitted that in some cases they are in fact highways. Indeed, this seems to be recognised in the Bill itself, particularly by Clause 63. Yet this Clause 42, as it is at present drafted, seems to be capable of being used to deprive these rights of all practical reality. It is our duty, it seems to me, to restore that right of practical reality to the Bill by establishing the law to be that reasonable charges shall be made, and it is for that purpose that these Amendments have been tabled. I hope that the noble Lord will be able to accept them, or that your Lordships' House will insist on his doing so if he cannot see his way to do it except under pressure. I beg to move.

Amendment moved— Page 44, line 2, after ("Boards") insert ("other than the British Waterways Board").—(Lord Chorley)

9.43 p.m.


My Lords, I rise to support these Amendments very strongly. In doing so, I should like to make it clear that I speak not only on behalf of the National Trust but in order to express points of political principle in which I have always most strongly believed. I should also point out that the Amendments which we are now taking together, Amendments 31 and 32, are, in my opinion—and I hope to convince the House of this—Amendments which the Government can certainly accept without doing any injury to any of the causes which they themselves have at heart in this measure.

These Amendments are a great deal simpler than those which were proposed during the Committee stage. They give to the Board concerned a very large degree of freedom, but they do not give it complete and uncontrolled licence. That is, after all, in accordance with those principles which Parliament has invariably insisted upon. I do not deny the right of any Government to take away existing rights to any extent they think justified, provided that they make absolutely clear on the face of the Statute, and justify to both Houses of Parliament, the necessity for their action, and provided that there is no concealment. In the case of this Bill, the Government concede that, for the purpose of actually closing a canal, normally some further proceedings are necessary—generally a Parliamentary Bill, or something over which Parliament has some control. But here, unless we amend the clause in some such way as is suggested, it would be possible to destroy public rights in a way that I think neither House of Parliament appreciates, and in a way which neither House of Parliament would have approved had it been made clear to them what was the effect of the clauses as they stand.

Let me say at once—and I have said this earlier in the Committee stage—that I have no hesitation in acquitting the Government of some of the extremely improper motives with which in certain quarters they have been credited. There are provisions in Clause 63 (to which I will refer later in my speech) which convince me that Her Majesty's Government are honest in this matter. But. my Lords, I hope to show to the House that, unless we adopt some such Amendment as this, the provisions for the protection of private interests, which Her Majesty's Government have thought fit to insert in Clause 63 (3), will be made completely unreal and can be destroyed.

My Lords, at an earlier stage of the Bill, in my speech on May 28 of this year, I attributed some of the mistakes, as it seemed to me, into which Her Majesty's Government had fallen to a failure to realise how very different was the legal position of a canal from the legal position, for example, of a railway. I used these words at Column 38 (Vol. 241) of the OFFICIAL REPORT for that day: The canals are more like a highway by water, both in law and in fact, over which the public has very considerable rights". Speaking on May 31 last, my noble friend Lord Chesham said this, in answering the noble Viscount, Lord St. Davids (column 351): I should think that the noble Viscount's case, eloquently supported by my noble friend, was a very much better one if I could even begin to accept the argument which was put forward about this question of the canals being public highways by water. I cannot accept that at all. I am going on to say why; but as I cannot accept that, I think that the case on which the noble Viscount has been working is not soundly based". On that occasion I was prepared, for the sake of argument, to accept my noble friend's use of the words "statutory rights of user." Even accepting that, I think that there is a strong case for this Amendment. But, having been rebuked for a misstatement of the law in a matter in which I had admitted that I did not speak as an expert and had not recently looked up the law, subsequently I took the trouble of looking into the decided oases and found that, if I erred at all, I erred in very good company, because practically my own words had been used so long ago as 1831 in the leading case by Lord Tenterden, Lord Chief Justice, and his view had been supported by numerous decisions of the Court of Appeal subsequently. Lord Tenterden said, in The Stourbridge Canal Company v. Wheeley, to which the most convenient reference is Vol. 109, English Reports, page 1336: … indeed the more obvious meaning of the clause"— which appears in most of the Statutes concerned— is to declare that the canal is dedicated to the public but at the same time to preserve the rights of the company to the rates already given". In many subsequent cases these canal cases have been treated as leading authorities on highway law. In the later cases, perhaps the most convenient, because it is in the ordinary series, is Blundy, Clark and Company Limited v. North Eastern Railway, Court of Appeal, reported in [1931], 2 King's Bench, page 354. That is a case I remember a little because the late Lord du Parcq, when a King's Counsel in my chambers, was one of the counsel in that case. Two of the Lord Justices in the Count of Appeal based their judgments on the view that canals were highways for the public at large. In these circumstances, while I do not blame my noble friend Lord Chesham in any way for repeating what was stated in his brief, if I erred in the company of a former Lord Chief Justice and Judges in numerous cases in the Court of Appeal, I need not perhaps take the rebuke too seriously.

But the matter is of considerable interest, because, if this is the approach of the Ministry of Transport to public rights declared over and over again by Her Majesty's courts, both the High Court and the Court of Appeal, it shows the necessity for Parliament to show vigilance, and it is that which we are inviting them to do in this series of Amendments. What is quite clear about this Amendment is that it gives the Government and the new Boards great freedom but it does not wholly disregard the established legal rights of the public, which ought not to be removed by Parliament, except in the clearest possible terms, when the case for the removal of public rights has been explained to both Houses of Parliament. I hope that, quite apart from the interests of the National Trust, that will be accepted in many quarters as a not improper statement of general principle.

In order to see the merits of the present Amendment, may I ask noble Lords to look at what the Government themselves propose in Clause 63 (3)? The clause removes a number of public rights for an interim period, but makes clear what it is doing, and in subsection (3) it preserves a right in the public to damages. It says: No person shall be entitled to recover from the Commission or from the British Waterways Board any damages or other sum or compensation in respect of any inability to navigate any inland waterway during the interim period in consequence of it not being in a navigable condition unless the right in respect of which he would be so entitled is a right—

  1. (a) which he has exercised or sought to exercise at some time in the period of six years ending with the relevant date, or
  2. (b) which his predecessor in title has exercised or sought to exercise at some time in the period of six years ending with the relevant date,
and unless he commences proceedings in respect thereof not later than twelve months after the end of the interim period. Then there is a proviso with which I need not trouble the House. What is absolutely clear is that Her Majesty's Government wish to preserve the right of a person who is injured to recover damages. Unless we pass the present Amendment, or something like it, Clause 63 (3) can be rendered completely useless and meaningless.

What would be the right of the ordinary trader to damages? It would be, in the ordinary case, for the loss of the profits which he could otherwise make. But if the Board were free to impose any charges they liked, they could make the winning of any profits wholly impossible. They could then turn round and say to him: "It would have been quite impossible for you to make any profit, in any event. You cannot have suffered damages, because you are unable to try to make impossible profits." If we allow this Amendment, and say that, though the Government have every other freedom they need, yet the court has the control which the word "reasonable" imports and which both Divisions of the High Court have enormous experience in administering (and I do not need to say, even to an audience of laymen, how constant are the allusions to, and the tests of, what is "reasonable" in our law), this new Board will still have immense commercial freedom, but it will remain true that public rights will not have been utterly destroyed, and it will remain true that Clause 63 (3) will have a meaning. I have quoted subsection (3) of Clause 63 because that convinces me that the Government could not have put it in unless they honestly intended it to have some meaning and effect. But this clause as it stands completely destroys that meaning and effect. For those reasons, I most strongly support the case which has been made.

9.59 p.m.


My Lords, in supporting this Amendment I want, first of all, to put one or two propositions with which I think the Government will agree. First of all, it is most important that in these inland waterways we do not in fact produce a position where the Government subsidise, out of the taxpayers' pocket, yachtsmen, fishermen and other people who use these waterways purely for pleasure. I think the Government will agree with that. It is important that we get the charging system of these waterways in a position where it supports the waterways without subsidy from Parliament, and where all those who use the waterways pay an amount which will keep the waterways properly on their feet—"viable" is the word which has been used, but which nobody seems to like. That can be done with charges which are reasonable, and the word "reasonable" would by no means limit the waterways to the charges which are at present imposed. I know that some noble Lords may think that I am purely a spokesman of the Inland Waterways Association. But I am nothing of the sort. I would not get up in this House and put any case in which I did not myself believe. Far more important, to my mind, than the yachtsmen and the other pleasure users of these waterways are the commercial users; and they, of course, are liable to be much harder hit by unlimited charges than anybody else.

As regards the reasonableness of charges, this can certainly be said. The present charges on the waterways, so far as the commercial carriers are concerned, are reasonable, and maybe they could be increased a little. As regards the yachtsmen (and I speak both as a yachtsman and as one who has had some experience in commercial carrying), the charges are very reasonable. Indeed, I have always felt that they err too much on the side of reasonableness, and I think they could be considerably increased. On the side of some of the other users of the waterways, the fishermen and so forth, the scales of charges so far imposed not only been reasonable but sometimes been positively unreasonable in the opposite direction. Cases have been seem where lengths of waterway have been let to large angling associations at charges which amounted to 6d. a head per annum for the members of the angling association—figures which are fantastically low.

But this point about "reasonable" must be faced. If we do not have the word "reasonable" in this Bill, it will damage the Government's policy in this matter, and end by wrecking the waterways. Already there is a movement among the commercial carriers to investigate what their position will be if a waterway is closed, and they have discovered the position which the noble Lord, Lord Conesford, was able to set out: that in such a case they will get no compensation, in spite of Clause 63. As a result, with the threat of closure of waterways hanging over their heads a number of them are considering slowly terminating their operations. This is surely not what the Government intend if they wish to put the canals commercially on their feet. Your Lordships may say that of course there would be compensation, and that all this talk about what would be done is pure supposition, because none of it has, in fact, occurred. I am afraid that we are not talking about suppositions; we are talking about things which have actually occurred and which are produceable cases.

I want to tell your Lordships about the case of a gentleman called John Gould. John Gould was a working carrier with a pair of boats with a very profitable trade, carrying goods to and from Newbury on the Kennet and Avon. The waterway was suddenly and, at that time, illegally closed by the Transport Commission. Rather than carry out the law which they were bound to carry out in their statutory duties they decided to close the waterway and face an action for damages from Mr. Gould. Mr. Gould, who is by now a citizen of Newbury and presumably will continue to be a citizen of Newbury until the waterway can be reopened, approached the Trans-port Commission with a demand to be paid £1,000 a year, which was his estimated profits on his trade. The Transport Commission's answer—and note this carefully—was: "We are agreed that you should be compensated because we have breached our Act but the damages which you have suffered are nothing like £1,000 a year because we have under our Act the power to charge you considerably more than we are charging you at present." They had the power to charge him more and, therefore, they said his future profits could not be assessed at £1,000 a year.

As a matter of fact Mr. Gould was lucky; he was very well legally advised. His advisers managed to prove to the Transport Commission that they had not the right to charge him anything like as much as they thought they had, and Mr. Gould received, and as far as I know is still receiving, his £1,000 a year. But what is going to happen to the next Mr. Gould after this Bill has gone through? Mr. Jones, with his boats, is going to be enclosed upon a waterway; he is going to go to the British Transport Board and say: "I want £1,000 a year for the loss of my very profitable business". They are going to say to Mr. Jones: "You have nothing like the right to £1,000 a year because we have a right to charge you an infinite amount." Do you think that they will not do that in the case of Mr. Jones? In fact they did it in the case of Mr. Gould. I think they will.

The net result is that Mr. Jones, for tall his rights, for all Clause 63, for all the good wishes of the Government, for every nice word which has been said—and I believe they have been said honestly and I agree with the noble Lord, Lord Conesford, in that—will not gat one penny. And for that reason Mr. Jones is already watching this Bill go through Parliament. He has an association of which he is a member. All these carriers are members of associations, which are advising them and are telling them: "No, when the cut goes out of use you are out of business, and with no compensation. "That is not encouraging Mr. Jones to trade; and all the Mr. Joneses are quietly looking over their shoulders and wondering how to sell their boats and buy lorries. If that is the way the Government want it to go, let them say so. But to insist on unlimited charging on these waterways is to produce in a fairly short time closure of the waterways and not to produce any balanced kind of economy at all. This is disaster that you are leading the waterways to, and not the public good.

10.10 p.m.


My Lords, as the time has gone along I have been considering the various points which the three noble Lords who have spoken in support of these Amendments have made, and summing them up I see that there was a certain amount of community of view among them; both the noble Lord, Lord Chorley, and my noble friend Lord Conesford said that they spoke in the National Trust interest. I am bound to say they were a little un-specific as to what the National Trust interest was in this connection, because if it became clear to the rest of your Lordships at least I can say it was not clear to me.


Perhaps their waterway might be cut off in the same way as Mr. Gould's is.


Something of the kind might be feared, but I was given to understand, as your Lordships were, by the noble Lords that the National Trust had a very wide and deep interest in the whole of this matter of reasonableness of charges, and if the National Trust is thinking of embarking as a canal operator on a very large scale, that would be a piece of news to me and no doubt it would be to a great many other very interested people, as was the earlier revelation of the noble Lord, Lord Stonham, that the heavy haulage manufacturing industry was going to be nationalised as and when his Party got back into power.


My Lords, whatever the noble Lord thought, let me say-exactly what I did say: that was that the Government were contriving a perfect set-up for nationalising, when we were returned to power at the next Election, the two great consortia which are now forming themselves into a private monopoly. That is a very different thing.


My Lords, I merely said it was interesting; I am not going to pursue that at the present stage, and I know what most of us understood. I said it was as interesting as this affair of the National Trust's being so interested because it may be going into the canal business in a very big way.


My Lords, if my noble friend is really interested in this matter, may I point out that I spoke on behalf of the National Trust and on my own behalf on questions of principle which I thought I explained. But the National Trust has already taken over one section of a canal. It hopes that it may preserve more of a glorious English heritage by taking over more. It is therefore opposed to every indirect method of wrecking the prosperity of the canals. This clause, as it at present stands, and as I have demonstrated, is one such method.


My Lords, I should have preferred to say that my noble friend had put forward what he considered to be a case. I should have said, to be quite frank, that it was far from demonstrated to your Lordships. But I am glad that we are at least a little clearer as to what is the National Trust interest in this matter. Again, as I said before, if I am faced with the same circumstances on the same subject, I can only make the same reply. I find the noble Lord, Lord Chorley, and my noble friend Lord Conesford directly referring to this almost deliberate attempt by a rather empty-headed Government at taking the rights away from the people. As I am going on to develop, to start with let me make it perfectly clear that there is nothing in this Bill that takes any rights away from anybody.


Except London Transport. They cannot build buses.


There is nothing in the Bill that removes the right of user on waterways. This Bill sets out to provide a structure of organisation and of finance, which is exactly what many people have been asking for for many years—that they should run on their own, divorced from the railways. To talk as if rights were being taken away, and as if there were legislation such as I referred to earlier which was altering the general law on canals or something of that kind, would be la different matter. If that were so, the noble Lords' case, which they have generally stated, might be justifiable. But at the moment in my view it is thoroughly over-stated.

The noble Lord, Lord Chorley, talking incidentally of structure and so on, criticised something that the alleged the B.T.C. were doing, and which he said was illegal. I do not know what it was. I do not know what grounds he has for saying it. But I do rather query whether it is right that he should come here and make statements of that kind. I shall want to look much further into this to find exactly what it is that he alleges. If it is true, he ought to be looking into it further and doing something about it. But in any case the matter is, I should have thought, quite irrelevant, because the object of this Bill, as I have just explained, is to reorganise the control of British waterways which will no longer be in the hands of the British Transport Commission.

We went back again to the question of public highways by water. My noble friend—my noble and learned friend—Lord Conesford, accentuated the "learned" part in a most learned way, because he quoted at me exactly what his precedent was for referring to them in this way. I am sorry to say that I remain still unconvinced about the matter; I prefer to stick firmly to the statutory rights of user. In any case, I am not going to pursue the matter with him again, first because he will always win over me in legal argument, and secondly, because, as he went on to say to your Lordships, it did not matter which it was, his objection was the same. So I think we can leave it at that point.

All the things that I have just mentioned were adduced as being reasons why this Amendment should be accepted, and that certain charges to be made by British Waterways should be qualified by the word "reasonable" instead of being at the free commercial discretion of the Board, as provided in the Bill. In other words, what the noble Lords want is for British Waterways to make only such tolls and charges as are reasonable and subject to such terms and conditions as are reasonable, and therefore that anyone who wished to challenge the reasonableness of a particular toll or charge, or the reasonableness of any terms or conditions, could apply to the court for a ruling. That would be the effect of the Amendment.

It is quite easy to be persuasive as noble Lords have been, and as the noble Viscount, Lord St. Davids, was on the last occasion, to dangle the word "reasonable" in front of us and to say that all you have to do is to accept it. We had a little exchange in regard to little words and bomb shells and things like that, which I do not have to repeat again. Because, my Lords, it is a fact that something that appears sweetly reasonable—I use that word on purpose—is not necessarily quite so innocuous as some noble Lords might have supposed. In the first place, in this context it is very difficult to know what is meant by "reasonable". The charges of British Waterways are at present subject to the qualification of "reasonable", as the noble Viscount pointed out, and anyone who is aggrieved can apply to the Transport Tribunal for a ruling. So far as I am aware, despite, as he said, their having latitude to charge more in some circumstances, no such test case has been brought. But, my Lord, if one were brought in the future, the court would have to decide it, and, if there were to be a series of decisions of that kind a number of precedents could be created, which would in itself establish a general pattern of standard or of maximum charges in relation to the class of cases decided by the court. In this way, over a period of time, a fairly detailed system of control might in practice build up, and "reasonable" cannot therefore just be dismissed as a small word. In fact, imposing the test of "reasonableness" is a material limitation upon the commercial discretion of the Board, and it is a definite contravention of what is the spirit and intention of this Bill.


My Lords, is the noble Lord contending that the intention of the Bill is not reasonable? I am sure he does not mean that. Does the noble Lord contend that the Bill does not affect the right to compensation?


My Lords, I have not come to that point yet. I will deal with it in a moment, but I have one or two other points to make first. I think that having regard to the financial situation in which the British Waterways Board will be placed, and the financial duty it will have under Clause 22 (4) to keep its revenue deficits at the lowest possible level, the word "reasonable" in this instance can carry a construction which is, to say the least, somewhat ambiguous and even equivocal. British Waterways have incurred working deficits—that is, before central charges—over the past few years averaging some £800,000 a year. We know that. Last year their working deficit was over £1 million. We know that too. In that case, to whom should the charges made by the British Waterways Board be reasonable? Are they going to be reasonable to the particular user who considers himself aggrieved? Are they going to be reasonable to the Board, having regard to its financial position and its financial duties? Are they going to be reasonable to other users who may have to pay more if some users pay less?

Or, my Lords, are they possibly even going to be reasonable to the taxpayer who has to meet the revenue deficit in this matter? It is the taxpayer who is subsidising the yachtsmen and the general traffic the noble Viscount mentioned. It is not the Government who are subsidising them, but, as I have said, it is the taxpayer himself. I think that there is no easy answer to those questions, and there is certainly no standard in the shape of any prevailing comparable charges which could be looked to for guidance in the matter.

10.25 p.m.


My Lords, I want to say a word as regards the argument my noble friend Lord Chesham is using at the moment. Is he suggesting that the courts would say that charges were unreasonable if the Board could show that they were unprofitable? I cannot believe that. If they were unprofitable and somebody appealed against them, the courts would say, "Obviously the charges are not unreasonably high, because they are not paying." That is the argument the noble Lord is putting forward: that the courts would be unreasonable in finding what was reasonable.


I was not putting that forward at all, my Lords. In point of fact, my noble friend is confirming absolutely my argument of how unreasonable it would be to expect a reasonable court to find a definition of "reasonable", which would be reasonable to anyone who considered his case unreasonable.


I cannot see any reasonable difficulty.


The noble Lord will see in a moment, when I have gone on. But the point I am trying to make, my Lords, apart from pulling my noble friend's leg, is that it will be very difficult—and he confirmed it in what he said—for a court to decide in the circumstances he mentioned what is reasonable to whom. There at once my noble friend put his finger upon it: if there is a large deficit operating on a certain stretch of waterway, is a reasonable charge going to have regard to that deficit, or is it going to have regard to what are the claims of an individual user who may feel that the charge is unreasonable? That is precisely emphasising the difficulty that I mentioned.


My Lords, surely the answer must be that it must be reasonable to the user; otherwise, it is a backdoor method of closing down a canal.


No, my Lords; it is absolute nonsense, if I may say so. In this particular case—and your Lordships will agree that I went out of my way to use those words twice, once in this context and once in this class of case—I said that it would be extremely difficult for a court to interpret "reasonable", because you could claim that if two boats a year went up a certain waterway which lost £2,000 a year, £1,000 a time would be a reasonable charge from the Board's point of view, but no doubt the boat owners could not agree. I am merely demonstrating that the use of the word "reasonable" in this context is extremely difficult.


May I then suggest——?


When I have finished my sentence I will willingly give way, but I cannot be continually interrupted in mid-sentence. I will give way when I have finished my point. The use of the word "reasonable" in connection with these charges is not one that can add anything to this Bill, or to what it is that noble Lords want.


My Lords, in the case that the noble Lord, Lord Chesham, suggests, the simple position would be that if they charged two boat owners £1,000 apiece, next year you would have no boat owners going down that canal. That, surely, will be the result—unless the noble Lord wants to close the waterway.


That I agree, my Lords, is a rather far-fetched kind of case. But it does not take anything from my point, that nothing is achieved by adding the word "reasonable" here, and it is merely to the detriment of what the Bill is trying to achieve.

I think the noble Lord, Lord Chorley, referred to the fears existing in some quarters that the Waterways Board would use unrestricted charges to strangle traffic and so clear the canal. I think that was the gist of his argument. My Lords, quite frankly, that does not stand up any more than the word "reasonable" does, because there will be a considerable measure of common interest between the canal users and the British Waterways Board. It will certainly not be generally in the interests of the Board to raise the charges in such a way and so high as to discourage the traffic on the canals, and so lose the revenue which it must have in the discharge of its financial obligations. To do so would certainly not be consistent with its financial duty; it would provoke enormous opposition when seeking the consequent legislation to close the canal. Furthermore, of course, if there were thought to be unfairness, the Minister could demand information from the Board and could issue at least a general direction on the subject.

I must just deal for a moment with the case put to us by my noble and learned friend Lord Conesford on this subject of damages. He will forgive my saying that it is not a new case to us; it has been considered previously on representations by representatives of the Inland Waterways Association. He probably knows about that. I certainly do not accept as correct the general proposition that if there is conferred on a canal undertaking the power to make unlimited charges, a person who feels himself aggrieved in the situation my noble friend mentioned will be deprived of the right to damages and compensation. My noble friend said that a trader would be able to produce a case of how much he would have used the canal if it had not been for the high charges, and how much profit he would have made if he had been able to use it.

The question of how the damages would be assessed in such a case would, of course, depend upon the particular facts, and on how the claim was made. The claim might relate to a past period, or it might, to some extent, be prospective. In so far as it related to a past period, the court would obviously look at the general pattern of charges, and there would not be very much difficulty there. But even in the case of prospective charges, in so far as the court was invited to consider possible future changes from the existing pattern of charges, I do not think that that would be very different from problems which the courts have to face almost every day, when they have to take account of future possibilities. I agree that in this case there is probably more room for argument, but, in looking at what might happen, the court would no doubt start off from the known pattern of current charges on comparable canals, and it would then listen to any argument which might be advanced for assuming some change in the future. The party who argued for such a change to be assumed would have to support his argument and convince the court that it was a reasonable assumption. But that is something with which the courts are well accustomed to dealing.


If the noble Lord will allow me to interrupt, I did not catch the adjective he used. He said that the court would have to find—I thought he said a "reasonable" assumption.


Yes, my Lords, I did say that. This would be one of the contexts in which the court could interpret "reasonable". What I think the court would not do would be to accept the proposition that it could make no assumption because the charges might be raised to any level. If it has to assess damages depending on future or hypothetical circumstances, whether it is how long a man will live or would have lived, or what charges, costs or values have to be assumed for a particular subject at a particular point of time, it reaches the best conclusion it can on the evidence before it. As these things go, I certainly should not have thought the present class of case would involve difficulties of any high order, so far as the charges of the Commission or of the new Board were concerned, when damages are being sought from the courts.

10.35 p.m.


My Lords, would my noble friend allow me to say a word, before he leaves that point? He seems to think that the court would have to speculate as to what the future charges were. Will he address his mind to the case where the Board, using the freedom conferred by this clause un-amended, increases the charges to a very great figure which makes profits impossible? There is nothing then for the court to guess at; it can see at a glance that there is no profit possible and therefore no future profit of which the complainants had been deprived.


My Lords, I think the court will, quite properly, require to be convinced that it is a reasonable assumption that charges will be raised as high as that.


But I am assuming that they have been.


In that case, it is the business of the court; but personally, I think it is very unlikely that it will be so convinced. I was glad to hear from the noble Viscount about the case of Mr. Gould, because he, at any rate, obtained substantial damages. I can only think that he cannot have been advised by my noble and learned friend, or, as the noble Viscount said, he would not even have taken the case to court.


My Lords, did not the noble Lord hear the noble Viscount say that it was found that they had no right to put up the charges? What they are now having is the right.


My Lords, I did not quite fathom what the noble Lord said.


Then I will make it still more clear. After the Transport Commission had attempted to use this argument against Mr. Gould, it was pointed out by the lawyers that the Commission had not the right to put up the charges, and therefore they failed. But if they had been doing it under this Bill, they would have had the right, and Mr. Gould would have had no case.


Well, I still have addressed myself in the way I thought was proper, and I myself think that the contention that damages could not be obtained in these circumstances is one which will not hold water. I think I have dealt with the reason for moving this Amendment, and that the reasons I have put forward against accepting it are convincing ones. I hope that the noble Lord will see fit to withdraw the Amendment, but, if not, I must advise your Lordships to reject it.


My Lords, may I put one question to my noble friend before he finally concludes? I understood him to say, at the beginning of his speech, that no public rights were being abolished by this clause. If he will look at what he said in column 353 of the OFFICIAL REPORT for May 31, and what he said elsewhere in his speech this evening, he will find he admitted that, at the present moment, under Statute the Commission are limited to reasonable charges. Under this clause as unamended they will not be limited at all. Does he really say that that is not a deprivation of public right?


Certainly I do, my Lords—if I may speak again right away to answer that point—because there is no right, I maintain, and I stick to these words, which the public have by Statute. The public have statutory rights of user of the canal, subject to paying whatever is the appropriate toll or charge, and they have exactly the same right under this Bill as they had before. It is merely the toll or charge which is altered in nature, because of the financial restriction for the benefit of the Board.


My Lords, at this hour your Lordships do not want a long speech, but I think two or three things must be commented upon. The main point which struck me, while listening to the noble Lord speaking to these Amendments, is that the whole case for these Amendments rests on a hypothesis that is difficult to accept. They believe that it is the intention and the wish of those who will compose the Waterways Board to close down canals, to drive traffic away, and to work themselves out of a job. That is extremely hard to accept, and I should have expected noble Lords to bring some evidence to support that view.

The noble Lord, Lord Chorley, talked about suspicions in the minds of many people. The noble Viscount, Lord St. Davids, quoted one example, that of Mr. John Gould. I had the privilege of knowing John Gould quite well at the time when he had a pair of boats twelve or fourteen years ago. It is surprising that no more up-to-date cases have been quoted. Where are all the cases of private commercial operators longing to operate, or perhaps operating, on canals and being turned off by the wicked machinations of the Transport Commission?


My Lords, after Mr. Gould had won his case, was it not natural that it should not be repeated, the law being as it is? We are talking about the law as it would be as a result of this Bill. Surely, the noble Lord would not expect the waterways to put themselves in the position of losing other cases.


My Lords, perhaps I can answer the noble Earl. The reason why Mr. Gould brought this case explains why there are no later cases. In his case, the Transport Commission had committed an illegality by the illegal closing of a canal. We should not expect them to go on committing illegalities every year.


My Lords, we have the noble Viscount's word for it that an illegality had been committed by a public authority. It is odd that no more has been heard of it. He did not mention cases where disused canals were specially opened, at considerable expense, in order to allow private operators to open up business where they said there was plenty of traffic. There was a case five or six years ago, when the Commission spent several thousands of pounds, and when the time came the private operator was not prepared to open up in business. It is surprising that we have had only one piece of evidence in support of this extraordinary allegation. For my part, I do not accept it. I think that the proposals in the Bill go some way towards restoring confidence among those interested in canals. I hope that the Government will not accept this Amendment.


My Lords, I regret that I cannot feel that the noble Lord has made any case against the Amendment at all. He devoted a great deal of his speech to almost deriding the capacity of the courts to decide on reasonableness, which every lawyer must know is one of the things they have been doing for hundreds of years. I do not want to keep your Lordships at this late hour. This case is unique in modern history. What stands out is that we are conferring monopoly rights upon this Board: monopoly rights, without any sort of control over the charges that are made. And that is against the whole current of philosophy of noble Lords on the other side. They established the B.B.C., but the B.B.C. cannot charge what they like: they have to go to the Postmaster General. In shipping, the Carriage by Sea Act insists on reasonableness. Where we are not to have reasonableness is where there is a monopoly. It is astonishing that noble Lords can defend a situation of this kind. However, I do not propose to take this argument any further. I cannot accept the noble Lord's argument, and I hope that the Amendment will be agreed to.

10.45 p.m.


My Lords, I must apologise to the House for not having been present during the earlier part of the debate, and I must also apologise if, therefore, I should show any insufficient appreciation of some of the points that have been raised. I know at all of the issues involved only because I happened to receive yesterday a certain amount of correspondence from an interested party, and I can only offer to the House one or two simple thoughts about the situation. I know there are those who claim that Clause 42 of the Bill destroys a right of access to, and navigation on, inland waterways by reason of the fact that the Waterways Board will be entitled to charge their own prices and to impose their own conditions; in other words, they will have the same freedom of contract as any other supplier of any goods or services has in the ordinary course under the law.


Would the noble Viscount contend that this will not, in fact, be a monopoly over these canals? It is not like people competing with each other. This is a canal monopoly. Surely he cannot deny that.


I was about to deal with the noble Lord's point. I heard him put it the first time, and he really had no need to repeat it to me now. I was just saying that there are people who claim that freedom of access and freedom of navigation are destroyed by reason of the fact that the Inland Waterways Board are given the right which exists in every other case, so far as I know, when anybody supplies any goods or services. I cannot accept that to be the case. The right is preserved by the Act, and defended, for what it is worth (and I heard my noble friend Lord Conesford refer to it) by Clause 63.

I know, again, that it is argued that Clause 63 becomes nugatory, because if the Board are entitled to charge an exhorbitant fee by way of charges the damages would either be nil or the court would not be able in any sense to give effect to them. Personally, I find that contention also difficult to accept. Of course it is true, as the noble Lord, Lord Chorley, pointed out, that an inland waterway is, to that extent, the only method of carrying goods by waterway between two given points—though not if there are two canals in competition with one another. But is this the realistic way of looking at the problem? I should have thought manifestly not. The carriage of goods between two given points can nowadays be effected by a great number of competing means—indeed, much of the controversy surrounding this Bill is derived from this particular fact. The demand is for coordination in such oases, and not for monopoly. However, I agree that there is a certain element of truth in what has been said. Against that we have to weigh certain other facts. One must not simply take the word "monopoly" and stampede in terror when it is uttered. It is not altogether true that this is a monopoly, for the reason I have given. It is true only to the extent that an inland waterway is the only means of conveying goods between two given points, and that is not as a rule correct.

But then, of course, one has surely to deal with the matter from the point of view of common sense. Our object is to make this Board a commercial viability: I think that that is the object of all of us.. We cannot go on losing £1 million a year on our canals, or an average, (as I believe it has been so far) of £600,000 a year—and the figure is rising. Is the canal authority to be deprived of the right to charge a reasonable price, by which I mean a price at which the service becomes a remunerative service? Is the court the ideal tribunal to decide what is reasonable? The court "sells no parsnips"; the court does not pay the losses. It is perfectly true, as the noble and learned Lord opposite said, that the question between the employer and employed as to what is a reasonable notice is a matter which has been decided by juries and now by judges from time immemorial. But the court does not have to carry on business. Are we really to continue losing £1 million a year, and more, in order to preserve the right of the court to decide what is a reasonable price? It seems to me that this is rather unrealistic.

Now a word on the question of damages. I am bound to say that I received notice of this matter at a very late hour today, and only preliminary notice yesterday, so I may well be wrong about what I say. But I simply do not believe, when the Statute says, as the Bill clearly does in Clause 63, that the right of damages is preserved, that at any rate a Common Law court, looking at that clause in the light of Clause 42, would say that there are no damages ever to be given. The only argument by which this extraordinary conclusion is arrived at is that Clause 42 allows the Commission and not the court, or some other third party, to decide what is a reasonable charge. I simply do not believe that this is the common-sense way in which a Common Law court would approach the matter. I can quite understand that in the labyrinths of some legal minds there might be a cause of suspicion here, but it has not been my experience of the courts of law that they disregard the manifest terms of the Statute, as contained in Clause 63 of this Bill, simply in order to give effect to a piece of ratiocination of this kind. I do not think it is fair, and I do not believe the courts would assume that the Commission would charge an uneconomic price in order to make a loss, and close the canal altogether. The business of the Commission is to carry on a reasonable business, just as much as if they were a grocer. Why should they charge an unreasonable price? The court will assume, presumably, that they will carry out the duty that is laid upon them by Statute. All that is really happening under this Bill is that Parliament is being asked to say that the right of charging prices and imposing conditions shall be taken away from bodies without responsibility for losses, and given to a body with responsibility for losses. If Parliament is to deny that right, then do not ever let it come to the Government and complain that taxation is going up because we have to pay for the losses.


My Lords, may I put one point to my noble friend? I am sorry that he was not here at an earlier stage, because I generally agree with him on his points of Conservative philosophy. I do not think he was here when cases were cited to the effect that canals were dedicated to the public, that they are places where the public has at present a right of going as it has upon the highway. Can he mention any case in Which a highway right has been taken away and the highway authority has been given liberty to charge anything it likes? In answer to his last point, is it not fair to say that, of course, if it is uneconomic, they may have to go to Parliament to close the canal.


This is, I should have thought, a matter for Parliament. It is quite true that I was not here when cases were cited, but it so happened that the literary material with which I was furnished before I rose to speak included a reference to those cases. Of course it is true that under the old law, which has led to the consecutive losses of a million pounds a year, and rising, the rights of the individual user of the canal have been equated to the user of a highway. I do not propose to dispute that for an instant. It is also true that from the 1960 White Paper onward the Government have made it perfectly clear that this is something which cannot continue indefinitely unless the taxpayer is prepared to pay an indefinite amount of losses.

Of course, a highway authority provides a highway out of the Consolidated Fund. It does not provide it free to the public; it does not provide it for nothing. Nor does it charge a toll. But this does not happen to be the basis upon which we propose to run our canals. If Parliament wants canals to be run without tolls or without charges of any kind, then let it say so. Then it will be run as a highway and the taxpayer will foot the entire cost. The duty of the Government is to ensure that the canals do not lose as much money as they have lost in the past. If this involves the individual's rights being subject to the law of Parliament, rather than to the individual decisions of the courts, it is for Parliament, in the long run, to decide whether this shall be so or not. We do not think this is the way to run a canal. It is not that I complain of the decisions of the courts based on Statutes passed in the middle of the nineteenth century, many of which were enacted before the railway age had really begun, and some of which were introduced because it was then feared that the railways would need to destroy the canals by acts of superior power by buying them up. How much of this legislation, and decisions based on this legislation, are relevant to the latter part


My Lords, I beg to move that further proceedings on this Bill be adjourned.

Moved accordingly, and, on Question,

Motion agreed to.

of the twentieth century I do not know. All I can say in answer to my noble and learned friend, is that I was aware of the decisions but I do not think they were decisive in this case.

On Question, Whether the said Amendment shall be agreed to?

Their Lordships divided: Contents, 9; Not-Contents, 35.

Airedale, L. Conesford, L. St. Davids, V. [Teller.]
Champion, L. Croft, L. Strabolgi, L.
Chorley, L. [Teller.] Moyne, L. Walston, L.
Abinger, L. Furness, V. McCorquodale of Newton, L.
Albemarle, E. Geddes, L. Massereene and Ferrard, V.
Ampthill, L. Goschen, V. Merrivale, L.
Bathurst, E. Grenfell, L. Mills, L.
Brecon, L. Hailsham, V. (L. President.) Newton, L. [Teller.]
Bridgeman, V. Hastings, L. Runciman of Doxford, V.
Carrington. L. Ironside, L. St. Aldwyn, E. [Teller.]
Chesham, L. Jellicoe, E. St. Oswald, L.
Coutanche, L. Kilmuir, V. (L. Chancellor.) Shepherd, L.
Crook, L. Lansdowne, M. Stonham, L.
Devonshire, D. Lindgren, L. Westwood, L.
Fraser of North Cape, L. Lucan, E.

Resolved in the negative, and Amendment disagreed to accordingly.