HL Deb 24 May 1962 vol 240 cc1076-121

3.33 p.m.

Order of the Day for the House to be again in Committee read.

Moved, That the House do now resolve itself into Committee.—(Lord Mills.)

On Question, Motion agreed to.

House in Committee accordingly.

[The LORD MERTHYR in the Chair.]

Clause 7:

Duty and powers of London Board

7.—(1) It shall be the duty of the London Board in the exercise of their powers under this Act to provide or secure the provision of an adequate and properly co-ordinated system of passenger transport for the London Passenger Transport Area, and to have due regard to efficiency, economy and safety of operation as respects the services and facilities provided by them.

(5) Subject to the next following subsection, the London Board shall have power to let motor vehicles on hire to other persons who hold public service vehicle licences under Part III of the Road Traffic Act, 1960, for use by them for the carriage of passengers.

(6) The London Board shall not keep for operation as public service vehicles more vehicles than are in their opinion required for the purpose of providing such transport services as they have power to provide under subsection (3) of this section and under the next following section and, accordingly, they shall not keep for operation as public service vehicles more vehicles than they would keep if they did not possess the power conferred by the last foregoing subsection.

(7) The London Board shall not have power to let motor vehicles on hire to other persons for use by them for the carriage of goods.

LORD TEYNHAM moved to leave out subsection (5). The noble Lord said: The object of this Amendment is to protect that section of the private bus industry known as contract carriage work, and for a few minutes before I move the Amendment I must take up your Lordships' time in giving a little background to this subsection. As is well known, London Transport enjoys a complete monopoly of all stage carriage and express services operating within the London Passenger Transport area. The monopoly, however, does not extend to private hire, or contract carriage work as it is known. Before the passing of the London Passenger Transport Act, 1933, both the boundaries and the powers of the new London Passenger Transport Board were the subject of detailed negotiations between the Pro-motors of the Bill and many other interested parties at that time, and the terms of the general settlement were, I think, an all-round compromise and were incorporated in the 1933 Transport Act.

One term of that settlement was that the new Board was authorised to run contract carriages anywhere within the London Passenger Transport area and on any route outside that area within a radius of ten miles—with regard to Kent, I think the radius was to be within five miles—from any point on the boundary of that area, but not otherwise. All endeavours to extend London Transport Board boundaries, or to increase its powers, which have been proposed on many occasions, have been regarded by other operators as a breach of the bargain which was in fact written into the l933 Act. The present Bill seeks to extend the powers of London Transport, I would say to a considerable degree.

It is true that under Clause 58 outside operators are for the first time given the right to appeal to the Metropolitan Traffic Commissioners against the refusal of consent by London Transport to allow any operator to run inside the London monopoly area, but this apparent dent in the monopoly I should say is likely to be of little real value. If the routes were successfully developed, London Transport, unhampered in this case by road service licences and timetables, could easily run the interloper off the road. I therefore regard Clause 58 as being nothing much more than a sop to the industry, and of little real value.

The powers of the London Transport Board to operate contract carriages under the 1933 Act were passed, as your Lordships will no doubt recollect, by a settlement reached during the passage of the Bill through both Houses. The matter was finally settled, I think, by a Joint Committee of both Houses. During these proceedings the point was raised whether catering for long-distance travelling by contract parties is or is not part of London Transport operations. It was decided that it was not, and that the conveyance of parties for a long distance outside the area of the London Transport Board, to seaside resorts and other distance places, was not the business of London Transport. It was pointed out, though, by the other side (and this I quite appreciate) that in order to carry on London Transport there must be spare vehicles and that it would make the whole business of London Passenger Transport more expensive if there were no outlet for their spare vehicles. It was decided, as a matter of compromise, that it was reasonable that London Passenger Transport vehicles should carry passengers for a distance of ten miles outside their own area, and no further.

The basis of the 1933 compromise was reaffirmed by Parliament in the Transport Act, 1953, and London Transport's power to run contract carriages outside their own area was re-established upon the 1933 basis. As your Lordships will remember, the power delegated to the British Transport Commission under the Socialist 1947 Act allowed London Transport to run 100 miles outside their area. This was abolished in the 1953 Act. Speaking for Her Majesty's Government on the Committee stage of the 1953 Bill in your Lordships' House, the noble Earl, Lord De La Warr, used these words [OFFICIAL REPORT, Vol. 180, col. 1391]: It is a question of fairness. The Commission are in a position to operate as a monopoly. The noble Lord"—

the noble Earl was speaking of the noble Lord, Lord Lucas of Chilworth— wants them to have power to run contract services in competition with private operators. With a background of monopoly, obviously, the Commission will be in a position to make conditions of unfair competition against a company who have not that background of monopoly. And he went on further to say [col. 1402]: I think there is really only one point here which the noble Lord has made"— again he was referring to the noble Lord, Lord Lucas of Chilworth— He has used the words ' open competition '. It comes to what is our definition of ' open competition '. If you are a great monopoly, with a turnover of £60 million a year, with the immense financial resources and funds that arise out of it, nobody can compete with you in your own area at all. It is suggested that this monopoly should be able to sally forth on to the roads, in competition with other operators who have not the benefit of that solid background of business. The noble Lord considers that ' open competition '. We do not. That is the difference. So far as I can see, it is a fundamental difference in point of view. Those were the words of the noble Earl, Lord De La Warr, who was then speaking on behalf of Her Majesty's Conservative Government. Although Clause 8 (2) of the Bill explicitly restates the existing powers of London Transport in relation to contract carriages, Clause 7 (5), which we are now discussing, gives the London Board power to let out vehicles on hire to other holders of public service vehicle licences. This is quite new and opens the door to what is, in effect, a very wide extension of the London Board's powers in respect to contract carriages, even though the expression "private hire" or "contract carriage" is not, I think, specifically mentioned in the clause.

In the first place, I think it should be appreciated that the practice of hiring in such a case is that the vehicle is hired out with the driver, and it is true that London Transport would not actually operate the vehicles themselves on private hire because they would find no difficulty whatever in hiring the vehicles and drivers out to other operators anywhere in the country, at prices at which they could afford them. I would say that the remarks of the noble Earl, Lord De La Warr, during the passage of the 1953 Act, which I have already quoted, apply almost as strongly to the present proposal. Nothing could be more ruinous to independent operators of private hire fleets than to have London Transport vehicles let loose on them, possibly even at cost prices. I understand that the Government are anxious to make the best use of available transport, and if this were merely a matter of a central stage carriage service little harm would be done and no outside operators would object. But what is involved here is excursions and tours, almost wholly pleasure traffic, which is very much a buyers' market and in which competition is already of the cutthroat variety.

I would say that the release of many London Transport surplus vehicles on hire would almost overnight destroy the equilibrium of the whole of the private hire industry in and around London and would put large numbers of private operators out of business. Is that what Her Majesty's Government really want? I think it should not be supposed that the fact that the hirer, under subsection (5), must be the holder of a public service vehicle licence is any material safeguard. I do not think it is. Such a person might in fact own a single minibus. Indeed, hawing regard to the exceptionally cheap rate, it would undoubtedly be possible to obtain them from London Transport. There is nothing to stop a company from actually being formed for the purpose of operating hired vehicles from London Transport during, say, the weekend. A company could be formed by the Holding Company for this very purpose.

Furthermore, it should not be supposed that there is any real safeguard contained in the last four lines of Clause 7 (6), which says that the London Board shall not keep for operation as public service vehicles more vehicles than they would keep if they did not possess the power conferred by the last foregoing subsection". London Transport has a considerable surplus of vehicles at the weekend. Surely the last thing they would want to do 'Would be to buy more vehicles in order to take advantage of subsection (5).

During the passage of the 1947 Socialist Government's Transport Act, I, as a Member of the Conservative Opposition Front Bench at that time, had a good deal to do with the attempts to amend that Act. I must say that I am now astonished to find that I am once more endeavouring to protect private passenger operators from the effects of a Conservative Government Bill. I would say no more, except to repeat that Clause 7 (5), which I wish to strike out from the Bill, is grossly unfair to private operators. I would therefore ask your Lordships to support this Amendment.

Amendment moved— Page 7, line 39, leave out subsection (5).—(Lord Teynham.)


I propose to be brief. I certainly do not wish to deploy some of the arguments that my friends will be making on the next two Amendments. We feel that those Amendments are necessary to give the London Board some flexibility in the use of their vehicles. However, I must say to the noble Lord, Lord Teynham, that I would have had a little more sympathy with the statement he has made if he had declared his interest. It is a practice in the House that when a Peer has an interest in the subject that he speaks upon, he declares lt. Perhaps I should have spoken earlier in order to give him that opportunity, but I thought that the noble Lord, because he has put down a number of Amendments specifically related to bus companies, would make it clear to the House that he is a director of at least one of these companies—a company, I should have thought by its locality, very much involved with the case which the noble Lord has made this afternoon.


If I may interrupt the noble Lord, I apologise to your Lordships if on this Committee stage I did not make clear my interest. I think I did do so during the Second Reading.


Very well, but there are some noble Lords here to-day who were not in 'the House at the Second Reading. However, I was not trying to score a point. The noble Lord complained that this Bill, a Conservative Bill, was giving an unfair advantage to a Board that has a monopoly position in London, as opposed to the private operator. I feel that the noble Lord has perhaps put his finger on the weakness of the 1953 Act. It was the 1953 Act that set road transport against rail, private road operator against the nationalised road operator. It is the Government that the noble Lord acclaimed in 1953 that have created the present position.

I think that this Committee must regard itself as being in the position of shareholders in the nationalised company. We are in fact dealing with the articles of association. It is a fact—and I am sure the noble Lord, Lord Mills, will agree with me—that when you set up a company to carry out an operation you try to give it in its memorandum and articles as much flexibility and as much latitude as possible. My friends take the view that there are many aspects of this Bill which go quite contrary to the normal commercial set-up of a company. Instead of giving it flexibility, you are restricting it.

The noble Lord, Lord Mills, was complaining on the first two days of the Committee stage that the Opposition were rather rigid in their approach to the Boards. Perhaps we were rather rigid, but we were then seeking to strengthen the Boards in carrying out their operations. We have now, however, reached the stage when we are looking at the rigidity of the Government's proposals for the operation of those Boards. As we go through the Bill clause by clause, we will see to what extent the Government are imposing a straitjacket on these Boards to restrict them in their operation. Subsection (5), which the noble Lord, Lord Teynham, wishes to omit, gives some flexibility: it permits the London Board to let their motor vehicles on hire to persons who hold a public service vehicle licence.

Why have the Government decided to do that? Perhaps the noble Lord, Lord Mills, will correct me if I am wrong, but I think it is because the London Transport Board has a vast number of vehicles which it is forced to keep and operate for a relatively short time each day, for five days a week. It is wrong, therefore, that we should restrict the Board as to the use of those, or any part of those, vehicles on Saturdays and Sundays. It is wrong that this Board should have assets tied up which they are not free to use.

Therefore I hope that this Committee will resist the Amendment that has been moved by the noble Lord, Lord Teynham. I hope the Committee will listen with sympathy to my noble friends, when they move the next two Amendments which will delete subsections (6) and (7). The principle which the Government want in subsection (5) is a good one, but why, then, do they not go the whole hog in that principle? I hope the Committee will resist the Amendment, I hope the Government have made up their minds not to accept it, and I must tell the Government—should they be wavering in any way—that they can count upon our support.


The speech that we listened to from the noble Lord, Lord Teynham, had little to do with the Amendment which he has moved. It really was a tirade against anybody coming into competition with people who fix their prices and do not want competition on a fair basis. But that is nothing at all to do with this subsection. This subsection gives a right to the London Transport Board to hire coaches to other private operators. The noble Lord, Lord Teynham, by reason of his association with the bus industry, knows full well what happens between operators. They accept any and every contract that comes to them. When a contract is received, they start to look around for the vehicles to use on the job which they have accepted—an outing to Clacton, an outing to Epsom, or whatever it is. All that this subsection does is to give to a private operator, having secured a contract and not having his vehicles, a right to go to London Transport to hire from them vehicles which are known to be roadworthy, with drivers known to be competent and efficient to drive their vehicles, so as to be able to carry out the contract already accepted under a private enterprise arrangement. If private enterprise does not want to operate this subsection, it need not hire the vehicles from London Transport.

What the noble Lord, Lord Teynham, is really afraid of is this. He knows that among the private operators, and particularly on the contract service, there are a number who are operating on a shoe-string. Reputable private hire service organisations are somewhat reluctant to go to some operators, because they are not satisfied with either their standard of maintenance or their standard of efficiency of operation. They would prefer to go to London Transport, knowing that they are hiring at a fair price a vehicle which is roadworthy and in the charge of a driver who is competent to drive the vehicle, thereby safeguarding the passengers that the private operator has agreed to carry. This is a subsection for which I commend the Government. It really is a subsection by which a socialised industry is available to help out private enterprise in the contracts that it cannot itself fulfil. If private enterprise does not want to use London Transport's vehicles, it need not hire them.


It is quite obvious that noble Lords opposite, and my noble friend Lord Teynham and myself, are miles apart in our views on this subsection. There can be no doubt whatsoever that under this subsection private hire firms could be heavily undercut by London Transport, both inside and outside London. It only remains for us to see and hear what Her Majesty's Government see in this subsection—what they really want, and what they expect. If it should be required of me, I will certainly follow my noble friend Lord Teynham into the Lobby on this Amendment.


I am neither a bus company director nor, so far as I am aware, have I ever held a share in a bus company. I believe that both sides in this argument are tending to exaggerate their positions. What we, as Conservatives, really want to see is that the State-owned industry in London does not extend itself all over the country into services which are at present operated by private operators. Moreover, preventing that would, I submit, be to the benefit of the London public, because whenever I travel in a bus I nearly always see advertisements up saying that bus drivers are wanted, and whenever there is any question of withdrawal of services London Transport are apt to say that they cannot get the right number of drivers and conductors. If they are going to let out vehicles at the week-end with highly skilled drivers, surely that is going to detract from the service that they can give in their legitimate sphere, which is to convey Londoners to and fro within the circle. Therefore, although my noble friend's Amendment goes a little far, I feel certain that the Government ought to introduce something into this Bill to stop London Transport from setting itself up primarily as a hire service for vehicles all over the country.


I had a good deal to do with all of these Bills, either piloting them for the Government or helping the Labour Government to make their Bills into better Bills. I am bound to say, subject to asking the Government one or two questions, that I cannot see much objection to this subsection. If it were to say that London Transport might come into competition with private enterprise in running a hire service outside their own area, then I should certainly oppose it, because that would be quite contrary to what we decided in 1953. I believe that even the Labour Government did not accept that when they had their Bill before the House. On the face of it, all this subsection seeks to do, as I see it, is this. London Transport have a certain number of vehicles which they require for the purpose of carrying the public in the London Transport area but which are not always in use, and, when they are not in use, they want to be able to let them—not to run a competing service, as I understand it—to a private company which is running a service. On the face of it, I should have thought that that was a pretty harmless proposition.

To some extent, we are all shareholders in this enterprise. We, all of us, certainly have to pay. All I know is that, when I come down to the House—I cannot afford a motor car in London now—I find that my bus fare goes up very frequently. If I could stop it from going any higher—because it used to be known as a 6d. fare and it has now gone up to 9d.—by letting people hire out their vehicles, I should be quite glad to do so. But there are two things of which we want to be quite sure. First of all—and, on the face of it, the Government have attempted to introduce a safeguard in the following subsection, subsection (6)—they ought not to have more vehicles than are required for their ordinary transport purposes. I should like to know who is going to ensure that.

It is all very well to have a sort of common informer, but somebody who thinks he is damnified has to bring an action. That is a pretty expensive thing to do against a great nationalised corporation. I think the Government ought to say that it is the responsibility of the Minister of Transport—because, after all, these nationalised undertakings are responsible to Parliament. I think we ought to be able to get satisfaction from the Minister of Transport; and, if it is alleged that they are carrying more vehicles than they ought to carry for their primary purpose, then we and another place ought to be able to ask the Minister of Transport about it, and the Minister of Transport ought to accept the responsibility of making an investigation and ensuring that that is not so.

The other possible risk that I can see (and I must use some anodyne phrase which does not suggest a "racket") is that somebody might think it convenient for the London Board to enter into some arrangement with one of these companies by which they hire them a vehicle at a very cheap rate, or in some way get round subsection (6). I think we should also like to be sure that we could hold the Minister responsible for ensuring that this was a perfectly bona fide undertaking. If the Minister were to say, "I accept full responsibility to Parliament for seeing that subsection (6) is fully carried out, and will take the responsibility", then, for my part, I should, for once, differ from my noble friend, who gave me such great help when I was helping the Labour Government over their Bill. Then, I think, I should support this clause as it stands.


May I put one question to the Minister for answer when he comes to reply? It seems to have been assumed on both sides of the Committee that when the subsection which it is proposed to delete says: … to let motor vehicles on hire", that means to lend the drivers also. I should have thought, off-hand, as a matter of law, that that was very doubtful. The Committee will observe that the subsection goes on to say, to other persons who hold public service vehicle licences under Part III of the Road Traffic Act, 1960, for use by them for the carriage of passengers". Who is going to be driving the vehicle, and whose servant is he going to be when so driving? Is he suddenly to become the agent of a different employer? I am by no means clear that the words in this subsection mean lending the driver at all. I am certain that the Minister has the point fully in mind and knows what the answer is, so I content myself with asking the question.


I should like to ask one question, too. It impinges on subsection (6) as well, but I cannot ask my question without it doing that. Subsection (5) says: … the London Board shall have power to let motor vehicles on hire …, or apparently, to refuse to let vehicles on hire as they wish. Subsection (6) says: The London Board shall not keep for operation as public service vehicles more vehicles than are in their opinion required for the purpose of providing such transport services …. Now suppose there is a private firm which wishes to run a line to, say, Brighton, but which is not allowed to do so because of the provisions of this Bill, though the firm can go to the Passenger Transport Board and hire a vehicle. Would it be possible for the Passenger Transport Board to say to them, "No. We think the services we are providing for Brighton are quite sufficient for the purpose, and, therefore, we will not let you a vehicle"? It seems to me that if they could do that, then that would be a very dangerous innovation. It may not be so: I merely ask the question.


Is the noble Marquess aware that the London Board would not be able to operate services to Brighton? We are talking merely of private hirings, special contract hiring; not regular public transport services.


I am not speaking about special contract hirings. I am speaking of a firm which wished to run, on certain days, a regular line to Brighton, or somewhere else—perhaps to see some sights in the neighbourhood of London. Would it be possible for the London Board to say to a firm of that kind, "No: in our opinion"—and they appear to be the final arbiters—"we think we are providing perfectly adequate transport for this service, and therefore we shall not let you a vehicle"? That may be an entire misapprehension, but I think we should have an assurance on the point.

4.6 p.m.


This discussion has been most interesting. Perhaps I am guilty of an underestimation if I say that it has been rather more interesting than I thought it would be. What is more, I find myself in a somewhat peculiar position, it seems to me, because I am certainly not accustomed to noble Lords opposite flying to the defence of Government ideas as expressed in this Bill, when their tendency so far has largely been to do quite the opposite.


We are not rigid.


In view of the noble Lord's service in the R.A.F., I shall not take up that remark. But, since he has mentioned it, I could not quite understand from him whether he considered that Her Majesty's Government were being rigid in this Clause or not; though from his definition, as I understood it, I should have thought that in this case we were well coming within his criterion of the way to strengthen the Board. I am certainly grateful for the support of the noble Lords opposite. I am grateful for the generosity with which they have recognised what we think to be right. I am, I must admit, in view of the next Amendment, just a fraction suspicious of the enthusiasm of their support; but I am, none the less, very grateful for it.

I am not very keen, if I may put it that way, to take up the amount of politics I thought was coming into the discussion at one time, and I certainly do not want to form a slightly strange alliance for the benefit of arguing this Amendment against my noble friends behind me. I am going to keep myself entirely to the merits of the case as I see them. I would say that my noble friend Lord Teynham put his case forward against a background which I accept, without actually checking his quotations, and which was, so far as I know, perfectly fair and perfectly accurate. I did not begin to dissent from what he was saying until such time as he began to draw his conclusions and to come to the reasoning for moving the Amendment that he has offered to your Lordships.

To be quite brief and to the point, I thought that my noble friend exaggerated his case. I thought the conclusions he drew were, if anything, over-exaggerated. His case would have been perfectly right, and a good one, if it was the fact that the London Board were going to be empowered to operate these services themselves. But that is not so: they are not going to be able to do that. Therefore I think that his case was greatly over-stated, in view of the danger that he fears (and my noble friend, Lord Grenfell, supported him in saying this), which was that it would create a great deal of havoc among private operators.

My noble friend Lord Teynham then went on to ask, quite crudely, whether Her Majesty's Government wanted large quantities of operators to be put out of business. Without the slightest vestige of political thought in it whatsoever the answer by any standard must be, "Of course not". I do not think—and I am sorry to feel that he should think—that Her Majesty's Government would dream up and put in any Bill a provision which would have that effect. There it is. That is his opinion, and I do not quarrel a bit with his right to hold it. But I do not believe that he is right in holding it.

With regard to the question of surplus vehicles, I agree that it is right that the London Board will have a large number of vehicles, because they need them. It is equally true to say that many of them are unused for quite a lot of the time. But they can go only to other operators, and they can go only on demand. There must be demand. Also, I do not think it justifiable to say that they will be let out at very low-cost prices. Because remember that there is a duty on the London Board to make whatever they can, as best they can, for the public purse; and they are under a duty to conduct their affairs with efficiency, economy, and safety. If hiring out these buses on a large scale will wear out all their buses, they are transgressing, perhaps, efficiency, and possibly safety. If they are not making what they should be able to make, then they are transgressing against their duty to act in the interests of economy. I do not believe that the operation of letting out these buses in fact constitutes a threat to a large part of the bus industry. My noble friend can put me right from his more expert knowledge if I am wrong, but I do not believe that there are a great number of firms who do nothing else but let out passenger vehicles on hire, and whose entire business consists of that alone. I believe I am rightly informed that the majority of them are also operators.

My noble friend also cast a shadow by suggesting that a company might be set up, perhaps under the Holding Company, to get round the law and in among the "private enterprise boys"; and "have at them" under some kind of guise. That cannot happen, because the Boards themselves cannot set up a subsidiary to do something that the Boards themselves cannot do.


But surely the Holding Company can under Clause 29, can it not?


Unless I am mistaken, I do not think the Holding Company is able to do that. I thought of this point in advance, and I checked to see whether there would be some way of setting up a subsidiary company in order to use its power to put a lot more vehicles on the road into competition with private enterprise, and I came to the conclusion, and I thought I was perfectly right in doing so, that it would not be possible to do this. I thought it was a very important point.


The point here is that the Holding Company has power "to form, promote and assist companies". I should have thought that under those terms it could form a company for the purposes that the noble Lord, Lord Teynham, mentioned. Personally, I think the Holding Company should have that power. If the noble Lord wants freedom and competition, I think he should be able to come to the nationalised industries as well as private operators.


I will deal with that point, or, at any rate, with that principle, when we come to the next Amendment. I do not think it would be a very good idea if I were to be led astray on that question at the moment. I still think I am right. I will certainly double-check the point with great pleasure, but I do not think it can be done in that way, and therefore I do not believe that that particular threat is of substance. My noble friend Lord Hawke introduced a point which interested other noble Lords as well. He did not think that the London Board should become a hiring agency and go into the hiring business. It is subsection (6) of the clause which prevents their doing just that thing, so his worry, too, is unfounded.

The noble Earl, Lord Swinton—and I was very glad to hear from him his views in support of what are the interests of the London travelling public, because, after all, that is the interest in regard to which this particular provision has been drafted—wanted to know the method of enforcement of the prohibition on the London Board from having more buses than they require for their services, and ensuring that they were not keeping a hire fleet specifically for the purpose. That obligation is on the Minister. The Minister has power to call for any information he requires from the Board, and, of course, if necessary, as I understand it, he is accountable. The noble Earl asked whether the vehicles would be hired out alone or with a driver, and the answer to that is that the power is to hire out the vehicle only, and not the driver as well.

In reply to the question asked by the noble Marquess, Lord Salisbury, the Board have complete discretion both ways, either to hire, or not to hire, as seems good to them at the time. They must have that power, because I suppose there could be some rather peculiar people who wished to hire buses from them and the Board would much rather they did not have them. They would operate in this regard, so far as their discretion was concerned, in very much the same way as any other organisation that was hiring out buses. So far as the rather hypothetical case the noble Marquess quoted is concerned, which had reference to somebody wanting to run a regular service to Brighton, or somewhere like that, and depend on the use of the London Board's buses to run that service, I think that what was in the back of the noble Marquess's mind was that if the Board refused to hire the buses, then they would, so to speak, be "getting at" that service. I do not think it could work out quite like that, because they would in any case need to have a licence from the traffic commissioners to run regular services, which are unlikely to exist side by side in that way because of the control of the licensing system. The Board would have no need to use that particular weapon of refusing to hire buses to a competitor in order to improve their own services over the same route. That question is a very hypothetical one and one which is unlikely to arise. I do not think anybody could rely on the possibility of being able to hire buses to run any kind of regular service, because the Board has, and must have, discretion to hire the vehicles out only at times when they are not busy, and the buses are surplus for the time being.

The point of this is that this clause is, in my opinion, justified and necessary in the form in which it stands in order to enable the Board, if it is going to act more like a commercial body, to make the best use of its assets. That must be right as a help to the Board to discharge the financial duty which it is given under the Bill, and it must be right in the interests of the travelling public, who may otherwise have to face increasing costs by higher fares to meet those costs. I think they should be entitled to gain the benefit of what is, in my view, a very reasonable provision. Therefore I hope that your Lordships will wish it to remain as it is in the Bill.


I only want to get the position quite clear. As I understand it, if a private firm wishes to run a regular service on the same route to Brighton, it applies to the licensing authority for a licence, and the authority have the final decision on whether that licence is granted or not. What actuates the authority in coming to a decision? Suppose that London Transport, when appearing before them, say that it is unnecessary to have this extra service because they are providing all the service that is necessary. In that contention, would they decide in favour of the Board, or would they say, "That is all very well, but we believe in healthy competition and we do not see why this other firm should not run. too"?


The noble Marquess's point arises out of the discussion and is not directly contained in it, but I am happy to tell him what the situation is. If an application were put in for this hypothetical London-Brighton run, which is already being operated by London Transport, the view the Authority would take is not that competition is a healthy thing and we should get plenty of people on this. The licensing system is based on quite an opposite view. What he takes into regard are the existing services, the requirement for a new service and the possibility of improvement of the existing service. It is control of competition and not duplication to which he looks. This is a system which has grown up over the years and I think it works very well and to the satisfaction of the bus industry.


But the final decision rests with the licensing authority?


Subject, of course, to appeal to the Minister.


I should like to get clear the question of letting out a bus without its driver. The noble Lord said that the Board would have this power. But if they let out buses without drivers, what is going to happen about maintenance, damage done to vehicles and the question of insurance? I do not think that any commercial firm, apart from the people who go in for letting out self-drive motor cars, would like to have other drivers monkeying about with their vehicles. That nearly always leads to disaster.


Of course, it will be done subject to the normal commercial arrangements for hiring out vehicles. We are trying to give the Board an opportunity of doing a little better by using a certain asset to better advantage. The surplus they have is in vehicles, not drivers. It is the vehicles which are standing about at the week-ends, earning nothing. Other firms do this hiring successfully. Naturally, before the Board would regard a vehicle as surplus it would make sure that adequate arrangements existed for normal maintenance, cleaning and so on. My noble friend must remember that drivers who drive public service vehicles have driving qualifications of a considerably higher standard than do many of the people who hire private cars for the week-end, and I think it is perfectly reasonable for the Board to take the normal commercial risks taken by other hire firms.


Would the noble Lord not consider that it might possibly be advantageous to the Board if these surplus vehicles were to undercut very heavily private enterprise rather than leave these vehicles idle? I think that is a rather pertinent point.


It is pertinent and it would be more pertinent still if they could use this particular weapon for some particular advantage; but, apart from being thoroughly dog-in-the-manger and beastly about it, I cannot see any point in their doing that. I tried to deal with that point earlier, when I said that it was the Board's duty to do the best they could. I think that if they were to let out their vehicles at very low costs, the Minister might well step in and tell them that they are hiring them out too cheaply and they must get more.


Would the noble Lord agree that the London Passenger Transport Board had this power and operated it until 1953 and that there was no evidence—I can say this from personal experience—of any undercutting?


I have so far regarded this as a hypothetical question, which would be extremely unlikely to operate in practice.


I thank the noble Lord for his explanation, but I cannot say that I am entirely satisfied with what he has told us. His statement that the Minister will have some control over the cost at which these vehicles may be rented out is certainly a great factor, and I appreciate the assurances that have been given to the noble Earl, Lord Swinton. I am still a little worried about the Holding Company and I hope that before Report Stage, perhaps when we come to Clause 29, the Minister will look into this question to see whether the Holding Company can in fact form a company for the purpose of hiring out these surplus vehicles.


I am sorry to interrupt my noble friend, but I think that it might be useful if I were to deal with this point now. I think all of us were half right on this matter. What I said I thought was the case was not strictly correct. The Holding Company could form such a subsidiary, but—and this is the important part—it would be subject to the direction of the Minister.


If I may say so, the noble Lord who is dealing with this Bill so thoroughly ought to make quite clear what the powers are, because we accept it from him that he accepts full responsibility for the Bill's being carried out according to the intentions of the House. In that case, the intentions of the Bill must be clear beyond peradventure, otherwise the Minister will not know what his duty is.


In view of the further explanations that have been given by the Minister, I do not propose to press the Amendment. I should like an opportunity of looking at the whole matter again before Report Stage, in view of what has been said. I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

4.30 p.m.

LORD LINDGREN moved to leave out subsections (6) and (7). The noble Lord said: I will admit right at the outset that the discussion we are to have on these two Amendments is much more fundamental than the discussion we have had on the previous Amendment. That Amendment, as we know, was on the question of the loan of vehicles to private operators. During his reply, the noble Lord, Lord Chesham, made use of the phrase that it was up to the Board to make the best use of its assets. It does not matter what form of transport you are operating, whether road, rail, sea or air, the fundamental economics of transport requires the 24-hour utilisation of your vehicle and, during its utilisation, as near 100 per cent. payload as possible. But, of course, when one is operating a system like London Transport, whatever is done by public advertisement and inducement to stagger hours, during a normal day there must be a heavy peak load in the morning hours when people are going to work, and another when they return from work to home. Therefore, for five days a week there is a requirement on a transport operator such as London Transport to provide and maintain vehicles to meet that heavy payload.

Between peak hours, and on Saturdays and Sundays, those vehicles are standing in the garage, on a slipway or roadway and are unused. For every hour that a costly vehicle is unused, either added charges have to be made in the period when it is used or there is a loss by the undertaking. The interest charges on the vehicle have to be met for 24 hours, even though its actual functional use may be only four or five hours a day. Therefore, the deletion of subsection (6), in particular, would give London Transport the opportunity it should have and which every ordinary private enterprise operator has; that is, to use his vehicles at off-peak times for contract work.

The noble Lord, Lord Chesham, said just now, in reply to the noble Lord, Lord Teynham, that there are very few operators who are doing private contract work only. Most of them are operators and doing private contract work "on the side", as a utilisation of the vehicles. Noble Lords opposite are always chiding us on this side of the House that we want to eliminate competition. They are always talking about the virtues of competition: how fine it is, and how it brings out the best in everyone. And yet when we have a nationalised service which has a surplus vehicle which it can use in competition with private enterprise, they are afraid of it. They tremble; they go white—real fear!


We are trembling sometimes only when it is unfair competition.


What is unfair in the competition? I challenge noble Lords opposite, who have wide knowledge and experience in private bus operation, to state any time when, prior to the 1953 Act, when London Transport had its private contract powers, it ever went into unfair competition with any private operator, even within the sphere which is given to it under subsection (5). In fact, their hire changes would be greater than that of the private operator, for the one reason that on a public service the standards of maintenance, their overheads and their costs are much higher than those of private operators.


The noble Lord is not suggesting, is he, that the standards of privately controlled vehicles are any lower than with publicly controlled vehicles?


I was just going to make an observation. There are private hire operators whose standard of maintenance and operation is extremely high. But the noble Lord knows as well as I do that there are many who are operating, as I said on the previous Amendment, on a shoestring. There are private hire operators who are using any "odd bod" at weekends for driving their vehicles When they are taking out fishing parties.


When the noble Lord says "any odd bod", he means somebody who has a public service vehicle licence?


Yes. But during the week he is a bricklayer, or an engineer working in a factory; and for "beer money" he is going out taking a fishing party or the women's institute to Clacton on a Sunday. But you do not get that with London Transport. None of its vehicles is operated by spare-time drivers, even though they may have a public vehicle driving licence.

What we are asking is that London Transport should be able to compete with private enterprise in the use of its service vehicles. We are not asking that it should have any privilege over private enterprise. The private enterprise operator has that privilege now. Why should it be denied to London Transport? I am surprised at this attitude of the Government, who are always talking about holding the cost of living. One of the arguments against London Transport is that it would lower prices. Why should it? I do not think it would in actual fact. Where is the advantage of competition and private enterprise? Are noble Lords opposite saying that there is a ring among private bus operators; that they are all agreed on the hire charge per day, per vehicle, per man? Of course, noble Lords opposite know that that is not so. They know that while there are bus operators who operate on a standard comparable with that of London Transport, there are many others who do not. We are asking, by the deletion of subsection (6), that the London Board should have the power to go into the private hire section, so that it can provide Londoners with a safe vehicle for a journey to the seaside on Saturday or Sunday, and that it should be able to transport a works outing if it so desires.


May I ask the noble Lord one question? I do not quite know what he is driving at. Is he suggesting that the London Board should be given powers to buy whole fleets of extra buses, beyond what they need during the week, in order to use them on this private hire?


I thought I made that quite clear in my opening. If I did not, I will make it clear now. In order that any operator can meet his peak load activity, he must have a surplus of vehicles. As I said—and I know that I said it, because I remember the phrases I used—London Transport has to meet the early morning carriage of workers to work, and the return of workers from factory or office to their homes at night. It means to say that a vehicle is in use perhaps only 5 hours out of the 24.


May I interrupt one moment? Why does the noble Lord want to delete subsection (6)? I think it is quite unnecessary. Subsection (6) would allow them to have enough vehicles to cover their peak load and hire out those vehicles.


But we want, in fact, to take this opportunity to give London Transport a power that it does not have at the moment: the power to use its surplus vehicles for its own operation on private hire work.


It is already in the Bill. It is quite unnecessary to leave out subsections (6) and (7).


Unless I am greatly mistaken, this Bill perpetuates what the 1953 Act did, to deprive London Transport of this right of general hire of their vehicles outside the London Area. Prior to 1953 if any employer went to London Transport he could hire a fleet of vehicles to take his workers to Clacton. He could not do so to-day. We want to give London Transport that opportunity.


I intervene only to say that if the noble Lord wishes to give them that opportunity I think he must really move a totally different Amendment. They will not get that opportunity about which he is now speaking by deleting subsections (6) and (7). It will not start them on getting that opportunity.


The noble Lord is a lawyer; I am not. I am just a fellow with common sense. But by my reading the deletion of these subsections gives a very useful opportunity to air that point of view, and I believe that if they were deleted it would give London Transport the power to operate on private hire work.

We come now to subsection (7), which says: The London Board shall not have power to let motor vehicles on hire to other persons for use by them for the carriage of goods. Why should they not do that? Here, in fact, they have vehicles for the carriage of their own goods; they have many specialised vehicles for the carriage of very specialised loads of their own. They have specialised equipment which is perhaps useful to industry in general. If London Transport have those spare vehicles that are out of use at an opportune time, why should they not be available for hire to private enterprise when they want to hire them? One cannot force private enterprise to take them, but here private enterprise is being denied the right to hire from London Transport specialised vehicles to help them carry out their private enterprise undertakings; and that, I think, is a hindrance to private enterprise. It might mean that certain private-enterprise undertakings might have to have their own special vehicles and keep them standing for long periods of time rather than in use. I have spoken for longer than I intended in moving this Amendment, and I hope that it will be agreed to, but I must admit that I have some doubt, in view of the opposition that was put by some noble Lords to the very innocuous previous subsection (5). I beg to move.

Amendment moved— Page 8, line 1, leave out subsections (6) and (7).—(Lord Lindgren.)

4.43 p.m.


I feel now in a very much happier position. We have considered the Amendment moved by my noble friend Lord Teynham. That went in one direction; that they should do no hiring at all. The noble Lord, Lord Lindgren, has just moved an Amendment that they should do the exact opposite—a great deal more hiring—in fact that they should enter the general hiring business.


I do not want to interrupt the noble Lord, except to make this clear: that the Amendment does give that power. My knowledge is greater than that of the lawyer who interjected.


I do not think the noble Lord quite took my noble friend's point, and I will come back to that in a moment. But that is what the noble Lord wants. Or, if he does not want it, that is what he would get by this Amendment. So the position of Her Majesty's Government—and what is suggested should be done is for a limited power to hire, to make use of vehicles—is probably just about right. That, quite frankly, is the position that I propose to stick on.

With regard to the argument that the noble Lord, Lord Lindgren, put forward in support of his Amendment, he will, I am sure, forgive me if I do not follow him into his at least semi-political views on the evil of the passenger transport industry. I think I will go straight to the point of the Amendment, because, to be perfectly frank, his remarks, though extremely interesting (I listened to them with great interest and I think everybody did), did not add much to any reason why this particular Amendment should be accepted. I thoroughly agree with much of his argument that the London Board should have power to utilise surplus vehicles when they are not on duty, so to speak, instead of leaving them—and he drew us a picture—standing about, in streets and slips, and so on. Certainly, we agree that if possible, they should be better used. Quite frankly, that is a very good argument for having subsection (5) of this clause; and I am at one with him there.

But while his argument for subsection (5) was, I thought, a very good one, I can see no particular reason why, as a result of that, we should feel in the least tempted to take out subsection (6), which is what he wants us to do. I do not see that there was any particular argument brought forward why the London Board should go into the general hiring business of passenger vehicles at large. And there is no reason, quite frankly, why it should. It is one thing to have power to make the best possible use of the assets you have, but what business is it of the London Board to invest its capital—our capital—in a great number of surplus buses which it is going to use only for hiring purposes and which it does not require for the purposes of which it is set up? I should have thought that the job of running the transport system in the London Area was a big enough task for anybody, and it is not the job of the Board to go into the business of hiring buses all over the country. This is really unreasonable, and I feel we should not accept this Amendment.

Coming to the goods side, if it is the Board's job to run a passenger transport system for London, it certainly is not its job to go in for general road haulage hire, and to have to carry a large stock of lorries for that job. I should be interested if the noble Lord, Lord Lindgren, had anything to add on this point, because my opinion on the subject seems to be rather at odds to his. My understanding is that the Board has no very substantial fleet of goods vehicles and that, in fact, its fleet consists largely of stores-carrying vehicles, engineering vehicles, maintenance vehicles and so on, which are fully occupied with the tasks they have to perform. They do not work in a peak and off-peak way the same as buses do, and there has never been, so far as I know, any demand or any desire on the part of the London Transport Board to hire these vehicles out. The present Board never has had powers to do so, and I do not see why the new London Board should need them now. For those reasons (I have been as brief as I could), I trust that your Lordships will not accept this Amendment.


I do not share the noble Lord's happiness that the brief subsection (5) honeymoon is over, because in the debate we had on it I thought we had heard more sound common sense from the Government on the subject of the Transport Bill than we had heard on any previous Amendment. I must confess I find it very difficult to understand why noble Lords opposite think that the deletion of subsection (6) will not make any difference to the powers of the London Transport Board to operate passenger vehicles.

Subsection (5), which we discussed at such length, empowers the Board to let motor vehicles on hire to other persons who hold public service vehicle licences. That is absolutely clear. Subsection (6), on the other hand, imposes a limitation—or seeks to impose a limitation: I would not say any more than that—on the number of vehicles the Board shall have. The words are: … they shall not keep for operation as public service vehicles more vehicles than they would keep if they did not possess the power conferred by the last foregoing subsection. I admit that it sounds rather like saying "A man shall not take his wife out to the pictures as often as he would do if he was not also married to the woman next door"; but I think I understand what it means. Certainly it is a limitation on the number of vehicles which the London Transport Board should hold and run; and it is that limitation we seek to remove. I think the noble Lord, Lord Chesham, will agree that there would be a real difference in the powers of the London Board if this subsection were not in the Bill.


If I may interrupt the noble Lord, I really think he has got this wrong, and I will tell him why. If he will look at the concluding words of subsection (5) he will see that it concerns hiring to other people "for use by them for the carriage of passengers". If subsection (6) were deleted, London Transport Board would have no power themselves to run these vehicles. It is only a limitation of the number of vehicles. They cannot keep vehicles specially to let them out for other people to run. That is the only thing subsection (6) does.


I am sorry I did not make myself clear, but I said, and it must be within the recollection of the House, that the one effect of subsection (6) which we desire to delete is the limitation on the number of road passenger vehicles which London Transport can run.


I am sorry to continue to interrupt, but what the noble Lord is saying is contrary to what the noble Lord, Lord Lindgren, said. I asked the noble Lord, Lord Lindgren, whether he wished London Transport Board to have an extra fleet of vehicles to do this private hire work, and he said "No". I understand the noble Lord is now saying "Yes".


I will try again. I think I used the word "run"; I will substitute the word "own". This subsection (6) seeks to limit the number of buses that the London Transport Board can own, and it is that limitation which we seek to remove. The noble Lord, Lord Chesham, in the previous debate said, in effect, that the Transport Board must have subsection (5) if they are to run their undertaking according to best commercial practice. Those may not be his exact words, but I think that is a fair paraphrase of what he said in justifying retention of subsection (5). And I agree with him. But in my view it is precisely for those same reasons of good business practice that we should not have subsection (6), in other words this limitation of the number of buses the Board can own, because I think it will conflict with the smooth and sound running of the business. Surely the Transport Board, who have an obligation to try to make their undertaking pay, ought to be the best judges of the number of buses they must own in order to discharge their responsibilities efficiently. That, surely, is the whole belief of the Government.


Which Board did the noble Lord say must be the judge?


The London Transport Board.


The noble Lord in fact said—perhaps I am stupid to have misunderstood—"Transport Board" and I did not know which one he was talking about.


I know that we have the Waterways Authority, the Railways Board and the Docks Board, and the London Transport Board is the only one of the four with "Transport" in its name, so there is not much room for misunderstanding; but I am talking about the London Transport Board. I would ask the noble Lord to say who in practice is going to be able to tell them that they own too many buses for their efficient purposes. I do not think anyone in practice would be able to tell that to the Board and the chairman of the Board. The thing seems to be totally absurd. I have heard of British Railways thinking they have too many trains and too many railway stations; they have said so themselves and they are cutting down. But I cannot imagine any authority in Whitehall telling the London Transport Board that they have too many buses. I think that the principal objection to this subsection is that it is in fact nonsense.


May I ask the noble Lord whether it does not say that the London Board shall not keep for operation as public service vehicles more vehicles than are in their opinion …"?


I am most grateful to the noble Baroness. That is precisely what that means—in their opinion.


Why does the noble Lord want to take that out?


Then we come to the point lower down; they shall not keep more in operation than in their opinion they need for their services, and they shall not keep … more vehicles than they would keep if they did not possess the power conferred by the last foregoing subsection". I submit that the whole subsection is nonsense, because the London Board are the people to say how many buses they need for their purposes. Therefore, why do we need this subsection at all? The operative words are in the last four lines. They seek to ensure that the surplus of buses that the Transport Board have, say at week-ends, shall not be too numerous. That is really what it amounts to: the number of buses they have for letting of this kind shall not be too many. I think that this subsection is unworkable. I believe that if we on this side had moved its inclusion in the Bill—which would be quite an incredible hypothesis—the Government would have declined to accept it on the ground that it is unworkable. If I am wrong about that, if in fact it could be made to work and made to impose a limitation on the number of buses the London Transport Board own, then it is wholly wrong and would quite unfairly and stupidly limit the Board's freedom of operation.

5.0 p.m.


I cannot understand what the noble Lord means by suggesting that this is unworkable, foolish or meaningless. Why should he assume that the London Board will not honestly try to do the job imposed upon them by this measure? If they do, the effect of subsections (5) and (6), taken together, is that they have to keep enough vehicles as in their opinion will enable them to perform their functions. Subsection (5) enables them, during such period as a particular vehicle is not required, to let it out on hire. The only point of the noble Lord in deleting subsection (6) would arise if he wanted the Board to be able to own a great number of vehicles, not because they thought they required them for performing the statutory duties which are imposed upon them, but in order that they should have a spare fleet for letting out on hire. If he wants that, then he would need to delete the subsection. But if he does not want that, there is no need whatsoever to delete the subsection, which carries out exactly the purposes which I have described.


What the noble Lord really wants is for the London Transport Board to gamble with the taxpayers' money, to buy a large fleet of buses extra to their requirements, which is laid down, in the hope that they can hire them out.


I do not want to delay the Committee or for the Transport Board to gamble with the taxpayers' money. But where the noble Lord, Lord Conesford, stops is at saying that the Transport Board shall have the number of vehicles which they believe they need for carrying out their functions. I think that is right and proper. He does not then go on to ask himself the question: what is going to happen if somebody else believes that they own more vehicles than they require for the proper execution of their functions? I think that this subsection (6) poses that problem. It is one that the Minister has not answered. The question I asked was: who is going to tell the London Transport Board that they have more vehicles than they need for their purposes? It is quite impracticable. That was the point that I was making.


I am sorry that the noble Lord still is missing the point that I was endeavouring to make. I quite agree, that of course there might be a difference of opinion as to what they need under the first part of that subsection for carrying out their statutory purposes; but if this were deleted they would not be limited to what in their own opinion they require for their statutory purposes at all; they would be at liberty to do precisely what the noble Lord's noble friend behind him says he does not desire that they should be able to do—to buy a whole fleet for no other purpose than to be able to let it out for hire under subsection (5).


I give way to the noble Lord's legal knowledge. My intention was to return to London Transport what they had prior to the 1953 Act, so that they could compete with private enterprise on normal private hire work. If the Amendment does not do that, perhaps it will give me a reason for withdrawing it. But that was the intention. Noble Lords exaggerate the position, because that is the situation which obtained prior to 1953. In their tours round London noble Lords may on many occasions have seen an ordinary double-decker but with "Private" showing on the front. If noble Lords wish to take their guests home from a cocktail party in one coach they can still hire one from London Transport, provided, of course, that the journey is within the confines of the London area. I think this subsection is a restriction on London Transport in regard to their ability to utilise their assets to the fullest extent. That is what they ought to be able to do, and that was my intention.

I will admit that so far as subsection (7) is concerned my argument is a weak one, except that you are putting on London Transport a restriction that is not imposed on any private enterprise industry. It stops London Transport from being brotherly. After all, any private enterprise undertaking can ring up another and say, "We are sorry, but we have had a bit of bad luck. Four or five of our vehicles are out of action, we had an accident yesterday, and we have some vehicles in the repair shop. Can you lend us a lorry to take our stuff around?". That subsection prevents London Transport from even lending to a fellow operator on a good neighbourly basis a vehicle to enable him to carry out his job—that is, of course, if London Transport said, "We are quite prepared to let you have the lorry, provided you pay us £2 or £3 a day for its hire".

I think that this is a restriction on them. I think it is unnecessary. I agree Chat they have not had the power to work private hire goods vehicles, and it was never intended that they should do so, because they are a passenger vehicle operator. But they have special equipment. Why should not they hire it out? Why should not they be allowed to hire out a breakdown van to help another operator? This subsection prevents them from doing so. But in view of what has been said, and of the fact that it is alleged that the deletion of subsection (6) would not really do what I intended it should do, I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 7 agreed to.

Clause 8:

London Board's road services outside London

8.—(1) The London Board shall have power to carry passengers outside the London Passenger Transport Area by stage or express carriage— (c) with the consent of the Minister, by any service beyond the limits specified in paragraphs (a) and (b) of this subsection. The Minister shall not give his consent under paragraph (c) of this subsection unless he is satisfied that there are exceptional circumstances which make it desirable that the Board should carry passengers on a particular route outside the said limits.

5.9 p.m.

LORD SOMERS moved, in subsection (1) (c), after "service" to insert, "over a route extending". The noble Lord said: After having heard the strictures pronounced by the noble Lord, Lord Shepherd, earlier on my noble friend Lord Teynham, I think I had better follow the example of my noble friend Lord Conesford and declare a total lack of interest. I am not a shareholder in any transport concern, and so far I have never driven a bus. The main purpose behind both Amendments Nos. 41 and 43 is one which, I have gathered from the remarks that I have heard so far, is not very popular on the other side of the Committee—namely, to limit the powers of London Transport. But this time it is limiting their actual running powers. Amendment No. 41 simply modifies paragraph (c) of subsection (1) by inserting the words "over a route extending".

As the paragraph stands, it seems to me that the Minister can give consent for London Transport to run a service practically anywhere in the country; and with the closure of various branch railway lines naturally they would be only too keen to snatch it up. But I personally am against any enlargement of the power of London Transport. They are most efficient in the work that they do. I am not at all afraid of competition. I am not one of those who, as the noble Lord, Lord Lindgren, said, go white in the face and tremble at the knees at the thought of competition by London Transport. But, like my noble friend Lord Teynham, I dislike unfair competition; and competition between a Board with the immense financial power of London Transport and a small provincial company is obviously unfair.

There used to be a tradition in this country (I hope there still is) of disliking an attack on a weaker person by a stronger person. I think that that applies very much in this case. Therefore, in regard to an extension of routes beyond their present boundary—that is to say, ten miles beyond the London area and five miles in Kent—the consent of the Minister should be in regard only to the routes which they are running at the moment, or at least routes that start in London. I think these words would provide for that. I will say a few words about Amendment No. 43 when we come to it, but it seems to me that the purpose of No. 41 is sufficiently plain.

Amendment moved— Page 8, line 29, after ("service") insert ("over a route extending").—(Lord Somers.)


I hope it will not embarrass the Government if I again oppose an Amendment that has been moved by the Back Benches opposite. I agree with the noble Lord that we do not want, nor do we expect, London Transport buses to operate in the Midlands or Northern Scotland, as he suggested they might under this Bill. I do not think that is possible. I certainly should not mind having an argument with him about competition, but it is getting rather late and I am quite sure the noble Lord, Lord Mills, must be getting rather worried at the progress of the Marshalled List this afternoon.

I oppose the noble Lord's Amendment on the ground that it will mean that this extension could be only "over a route" and not an area. Much of London's lines of communication stem outwards from the central hub. They are particularly weak laterally, and if the Board is to be prevented by this Bill from providing services, which may not exist to-day, to connect with some of the railway stations to enable people to get to Central London (some of whom come by the branch lines, many of which are now being closed, and therefore alternative bus services must be provided outside the existing London Passenger Transport Area—I am thinking of my own locality), then I think the Bill is wrong. If lines have to be closed because they are uneconomic, the Board should have the right—in fact, the duty—to provide these services. If the noble Lord's Amendment were to be accepted by the Government, I should imagine that the Board would then be quite unable to provide these replacement services, which, I certainly think, will be needed in the next few years.


I am not quite sure that the purposes the noble Lord, Lord Shepherd, desires, about which I do not think there would be a very great quarrel, would be served by the existing clause or by any Amendment thereto. I am not sure that we have not got it a little wrong. The Act of 1953 gave powers to the London Passenger Transport Board which were the subject of detailed negotiations between the various interested parties at the time. That Board was authorised to run contract carriages from any point on their boundary to within ten miles outside their boundary, or in Kent five miles. This Bill enlarges the powers by allowing them to run stage or express carriages into those same limits. The safeguards in Clause 59 are intended to look after the interests of the existing operators in those fringe areas. So unless the stations that are closed down happen to be within that particular limit, I do not think Lord Shepherd's points will arise.

However, under Clause 8 (1) (c) it appears that the Minister can give powers to the London Board, in exceptional circumstances, to operate stage or express carriages anywhere in the country, and this seems unnecessarily wide. This Amendment would make sure that the Minister can exercise his powers only where the prospective route starts within the London Transport Area. Then in the next Amendment but one, No. 43, we attempt to cater for the exceptional circumstances—if my noble friend will forgive me for anticipating what he will move in a moment, but I think it is essential in order to explain Amendment No. 41. These powers exist in the British Transport Commission, and they could have been delegated to the London Passenger Transport Board, but, in practice, they have been very little used. They have been used when London airports have been fogbound in order to take passengers to other airports, and the like.

The original powers were given for possible delegation to satellites in the Provinces, but, under the new set-up, the new Board will be the only possible beneficiary. So although Clause 59 is a safeguard for existing operators, the Minister can override the Traffic Commissioners. We think that we should keep the powers of the London Board, plus those of the Minister, for what is reasonable and necessary for the running of the London Transport Board—plus the provision of emergency services, such as for the fogbound airways, and so on. These seem to me a very reasonable pair of Amendments, and I do not think Her Majesty's Government ought to find any difficulty in accepting them.


We had a very interesting contribution from Lord Somers when he introduced this Amendment, and for the first time he gave a definition of "unfair competition"—namely that an undertaking with a capital structure as large as London Transport's was unfair if it was in competition with a small operator without a great deal of capital. Is this not a unique argument against competition to be used by noble Lords opposite? Not so long ago we were discussing the Courtaulds-I.C.I. merger; every day we hear about brewers amalgamating, with larger and larger amounts of capital involved. Noble Lords opposite do not then ask for legislation. This Government would be more unpopular than they are now if they introduced legislation to stop these amalgamations of capital, which noble Lords opposite claim, on private enterprise lines, enable the industrial organisation, the commercial undertaking or brewery, to give a better service to the public.

Noble Lords opposite are saying on this Amendment, and in their previous statements, that because London Transport, with its capital structure, its knowledge of operation and its efficiency of operation is so good, it is unfair to those who are less efficient, who have less equipment, and who provide a lower standard of service to the public. Really! we get some fantastic arguments from noble Lords opposite. I hope that one day they are going to say that we should not have chain stores, only small shopkeepers. Every day we see concentrations of capital, rationalisation, a greater extent of service to the public, probably at a lower price, with greater efficiency. Why cannot the public have the benefit of the greater efficiency of London Transport, and why are noble Lords opposite so anxious to keep the inefficient private operator in business?


There is no prize for the answer.


I am very grateful to my noble friend Lord Hawke, for explaining so clearly the purpose of the first of these two Amendments, which I had found difficult to understand before he spoke, because I could not see any real difference between "service beyond the limits", and "service over a route extending beyond the limits". If you have a service, you must also have a route, unless the London Board were to get some caterpillar-tracked vehicles and to go over the fields, which I think would not be agreed to, either by the Traffic Commissioners or by the owners of the fields. But my noble friend has now made it plain that he would like to restrict this emergency power to services which must begin in London and end in London, with no interval between the two runs outside the London area. I would assure your Lordships that we are not making any assumptions in favour of the inevitable superiority of the London nationalised transport service, or the inferiority of private services. All we want is to make the best provisions we can, so that in exceptional circumstances the London Board's services may be utilised for the convenience of the public, which I think is a reasonable thing to do.

I would remind your Lordships that, there is nothing in subsection (3) of this clause to exempt the London Board from any of the requirements of the Road Traffic Act, 1960, so that the Board will always have to apply for the necessary road service licence from the traffic commissioners; and, also, that services of this kind can be authorised only when the Minister is convinced that the need for them arises from exceptional circumstances. I would suggest to your Lordships, that it would unnecessarily restrict the usefulness of this provision if we were to stipulate that these exceptional services must begin with the starting of the bus in London, and end by its return to its base on every occasion.

As regards my noble friend's other Amendment, No. 43, I have also given a lot of attention to this, to see whether it might be possible to argue that we mean much the same thing by "exceptional circumstances" as is stated in the Bill, and as is stated in my noble friend's phrase: … any temporary interruption or diversion of traffic by air or any temporary interruption of any railway service or other unforeseen emergency". But I think the difference is considerably more than a verbal one, and it seems to us that the Amendments are too narrow to be acceptable. I agree at once that a great many, perhaps most, exceptional circumstances may be unforeseen; and they may often be in the nature of an emergency, because the Ministry of Transport certainly do not lay any claims to clairvoyance. They do not have the powers of infallible prophecy. On the other hand, in spite of all that their detractors say against the Ministry of Transport—and they do say a lot—the Ministry of Transport are capable of reasonable foresight, which they very often exercise in the interests of the public. I think that there are many exceptional circumstances, and perhaps even some emergencies, which can be foreseen and anticipated by the proper, careful exercise of calculation and prevision.

I would therefore suggest to your Lordships that the clause as it stands is the best middle way, if I may put it like that, between the views of noble Lords opposite, who would like a much wider extension of the London Board's powers to operate outside London, and those of my noble friends, who are apprehensive lest we shall give the London Board too great powers to carry on unfair competition with private transport operators. Certainly it seems to me, in view of the fact that the Minister has to satisfy himself in regard to these fairly strict conditions, that the interests of fairness are safeguarded.

With regard to the point in the second paragraph of my noble friend's Amendment, about revoking or modifying any consent or conditions, or consenting to the whole or part only of the service for which his consent is sought, I do not think there is any need for this definition. The Minister must naturally consider whether any part of a proposed service will meet an exceptional need, and whether there is any part which will not meet an exceptional need. He can always tell the London Transport Board to take back the application and make another. In Clause 28 (1) it is provided that: Any consent which the Minister is authorised to give under the foregoing provisions of this Act may be given for any case or description of cases specified in the consent, or may be general, and may be given subject to conditions. I would suggest to your Lordships that it would not be in the public interest to restrict the Minister's freedom of action further than we have done in the Bill—although we fully understand the need for not encouraging unfair competition, which we do not think the Bill does—and I hope that your Lordships will agree that our proposals constitute the best and fairest solution to these rather difficult problems.


I am not sure whether I heard my noble friend aright, but I do not think the object of the first Amendment, as he put it, was that they should operate from a point within the London Passenger Transport Area and return. I do not think that is the point. I think it is that they must operate from a point within the London Passenger Transport Area. I do not think there is any requirement to make a circle, in other words. It is merely that they should not have the power suddenly to run, say, from Glasgow to Edinburgh; they would have to start within the London Passenger Transport Area. I think that is the real point of the first Amendment.

I must admit that in my own heart the second worries me a little. Although it says, "with the consent of the Minister", we do not know who the Minister is going to be in the distant future or what his policy is going to be. For that reason, we feel we should rather like to limit to a certain degree what he can do. But I hope my noble friend will withdraw this time, and then we might think it out rather carefully and perhaps come back to it on Report stage.


There was one point in my noble friend's reply which gave me some slight feeling of disquiet, and that was when he started talking about the Bill as a fair compromise between the views on this side of the Committee and those on the other. My noble friend is supposed to be a Minister of a Conservative Government, and I should have thought the fact that we are putting forward views, not to lessen the powers of a nationalised undertaking but merely to limit them to what they are at the moment, would hardly have been considered very ultra-Montane or Right Wing. Therefore, I should have expected him to say that he would accept our version provided the wording, and so on, was correct for the Bill. I wonder whether in the circumstances, he would consider removing the words, "exceptional circumstances", which are open to very wide interpretation, and putting in something stronger, to the effect that there should definitely be an emergency, and at the same time strengthening the requirement that the service should start within their own boundary.


I would not necessarily accept that the views of my noble friend and those who support him in this matter, reasonable though they no doubt are, are the views of the Conservative Party; and I was not thinking of this as a Party matter. It so happens that those of my noble friends who are moving the Amendment are on my own side of the House, but I assume that some of us on this side of the House are not altogether in agreement with the Amendment, and I would therefore not regard it as a compromise between Socialism and Conservatism that we are trying to make the Bill as fair as we can.

I shall certainly look into the question which my noble friend Lord Grenfell raised just now. I would not have thought that the wording which we have in this Bill was calculated to lead to any other result than that which he desires. I do not feel that the first of the two proposed Amendments is one which we should be justified in accepting because, as I have said, I think it would unduly restrict the usefulness of giving the Minister power to allow the London Board to give exceptional services which the public might really need. It would not be sensible to prevent them from doing that, whatever views we may hold about private enterprise and public enterprise.

I shall certainly consider what my noble friends have said in this discussion. I am always very glad to consider any suggestions for improving the Bill in this way. I should just like to make it clear again that we are trying to make the best of the benefits that can be derived both from public transport owned by the London Board and from private bus services, owners and haulage contractors, whom we believe also to be generally efficient—and I do not agree with anyone who says that one is much better than the other. We are trying to the best of our ability to do that which is fair to both and that which is best in the public interest.


I should just like to say, in answer to the noble Lord, Lord Lindgren, that he must live on an extraordinarily good bus route, because there have been many times when I have used positively blasphemous language against the inefficiency of London Transport, and I do not think that anybody could deny that a great many of the provincial transport services are extremely efficient and well run. However, that really has no relation to the Amendment; and, on the strength of my noble friend's assurance, I beg leave to withdraw.

Amendment, by leave, withdrawn.

5.37 p.m.

LORD STONHAM moved, in subsection (1), to omit all words after the end of paragraph (c). The noble Lord said: The proceedings this afternoon seem to have developed themselves into a sort of ritual. Noble Lords opposite move Amendments and urge Her Majesty's Government to take action with the object of limiting the powers of the London Transport Board, for the purpose of making things better for private undertakings, which is fair enough; the Government resist those proposals, and we listen to them being accused of rigidity. After that, we come along and move Amendments designed to give greater powers to London Transport, because it is our view that it would be to the detriment, and unfairly to the detriment, of the private undertakings. Amendment No. 42, which I now move, is another chapter in the serial, because we are not satisfied that the words which we propose should be deleted are necessary or desirable.

Paragraph (1) (c) says that the London Board shall have power, with the consent of the Minister, to run services beyond the limits specified in paragraphs (a) and (b). We feel that the consent of the Minister to those services should be quite enough. The noble Lord, Lord Grenfell, indicated that that might be all right while there is a Conservative Minister, but that he would be apprehensive if there were a Minister of any other political character in charge. I think those fears are quite groundless, because if a Labour Minister of Transport were in charge, then I can assure your Lordships that the Transport Bill which would be very quickly introduced would be very radically different from the one which we now have before us. Therefore, for all practical purposes, when dealing with this Bill we are considering a Conservative Minister's reactions if and when it becomes an Act of Parliament.

The words which we wish to delete are those which say that the Minister shall not give his consent to these extended services unless he is satisfied that there are exceptional circumstances which make it desirable that the Board should carry passengers outside the defined limits. The noble Lord, Lord Somers, in his Amendment No. 43, has attempted to define what he would regard as "exceptional circumstances", and I am grateful that that attempt has been made. I agree that what he has defined are exceptional circumstances, but they are not the kind that we on this side of your Lordships' House would be prepared to accept. I would ask the noble Lord who is going to reply to give us some indication of what circumstances he would regard as exceptional.

The noble Earl, Lord Dundee, was not prepared to accept Lord Hawke's idea on this question, and I agree with him. We ought to be told what kind of circumstances the Government have in mind as likely to arise which would make the words already in paragraph (c), "with the consent of the Minister", insufficient. It looks as if by using the words "exceptional circumstances"—"unless there are exceptional circumstances"—the Government are trying to reassure somebody that it is going to be only a most exceptional event for London Transport to be allowed to go beyond these limits. Here, again, it seems that an unbusinesslike restriction is being put on the London Board. Surely if they want to run a service, and they go to the Minister and ask for his consent, before they ever go to him they will have satisfied themselves that there is a demand for the service they want to run; otherwise, there would be no proposal, and it would be very stupid to ask permission to run a service for which there is either no demand or insufficient demand. In other words, they would be proposing to extend their service to meet a need. I should have thought that that was a highly desirable thing.

It is no use going into detail on the particular service, but let us assume that there was already in existence a service—it does not matter whether it be a railway or a private bus company running the service. It does not seem possible that London Transport would then go to the Minister and propose that they should run another service. Therefore I think I am right in assuming that no proposal would go forward to the Minister under subsection (1) (c) unless there were a real need. I think that is fair enough. Therefore the insistence on the words "exceptional circumstances" seems to us to be a sort of device for "holding the ring", as far as it can be held, for the private enterprise companies.

We on this side of the House feel that we should consider first, foremost, and all the time, the needs of the travelling public. I do not think anyone is yet in a position to say which parts of the country are going to be denuded of a public service that they now enjoy. It is generally thought that there will be parts of the country affected in this way. It might so happen that there would be such an area within the Home Counties where there is no private bus company in existence and no proposals to run a service; therefore, why should not the Transport Board make a proposal to the Minister to provide a service, or to extend an existing service, or to link it up with one they may already have? I should have thought that was a highly desirable proposal. I wonder whether the noble Lord will be able to say that he regards the example I have just given as coming within the term "exceptional circumstances". Because, if not, then I would submit that we have made our case for the deletion of these lines which limit the freedom of the Minister's judgment to approve a proposal from the Transport Board under subsection (1) (c). I hope I have made my point clear to the noble Lord, and I beg to move.

Amendment moved— Page 8, leave out lines 32 to 35.—(Lord Stonham.)


The lengthy disquisition of the noble Lord, Lord Stonham, on this subsection gives me the opportunity of saying something I should have said on the last Amendment. That is that, if the Government are redrafting this subsection, I think they ought to use some words which connote that the "exceptional circumstances" shall not start up a regular bus service but that they may start up a single service or a short series of services. They should not start up a perpetual service.

5.46 p.m.


Your Lordships will forgive me if I speak rather fast, but I should very much like to give my answer to this Amendment before we reach the time to adjourn. Before I come on to talk about what we consider might be "exceptional circumstances", as the noble Lord, Lord Stonham, asked me to, I think I had better first explain the background to the reason why we considered quite firmly that those "exceptional circumstances" should be dealt with in the subsection, and then I will explain why that should remain there.

The noble Lord mentioned a ritual in our proceedings, and certainly there seems to be a ritual in another form in that noble Lords opposite have, throughout their Amendments, been showing a strong tendency to try to persuade the Committee that these Boards should spend a great deal of time in engaging on occupations which are not there to be engaged upon. The noble Lord shakes his head, but that is so, and it has been so throughout, as he will find if he refers back through Hansard.

The point is this. London Transport—and what is going to be under the London Board—is by far the largest urban passenger transport monopoly in the country, and it is probably the largest in the world. I think the noble Lord will agree with that. I maintain very strongly that the job of the Board in running that monopoly in its area is quite enough for it to do. It ought not to be concerned in running services well beyond its area, and, indeed, possibly all over the country, unless there are exceptional circumstances to justify it. I think it would be held that it would perhaps be a reasonable quid pro quo (if one might might call it that) for having a monopoly territory if you had a restriction from going outside it. I should have thought that that was a perfectly reasonable proposition.

Their job is to run the passenger transport services in that area where they have a monopoly. They have no business to be running bus services all over the country, or to points distant from London. I do not think, if the power is to be left with the Minister to allow the London Board to operate beyond its area proper and the capacity belt, described in paragraphs (a) and (b) of Clause 8 (1), that that power ought to be left at large. It is a very wide power, and it certainly should be subject to some such qualification.

The intention of Clause 8 is to enable the London Board to continue running the services which have been running under the Transport Act, 1947, including services which the former London Passenger Transport Board were authorised to operate under the London Passenger Transport Act, 1933. The intention is to preserve these services and, in order not to be too rigid, to have power to adjust these services where exceptional circumstances come into play. In my view, these exceptional circumstances would be mostly where the Board are approached to operate some kind of on-demand service—for instance, to diversionary airports when these serve the London area or are adjacent. This is done now by the London Transport Executive, as agents of B.E.A., to Hurn and Southend. This power might be used for bus services in substitution for railway services where these were suspended due to accident, landslide, major repairs, or something of that kind.


Would that cover the closure of a railway service in the outer suburbs of London?


I think that is dealt with elsewhere, is it not? I should have thought that that was not a question of diversion. I think that it would fall to the Minister to decide whether the circumstances were exceptional, but normally it would be a contingency of a temporary nature.


At Westerham the branch railway line has been discontinued, and the Green Line are operating to and from London. Would the noble Lord not consider that it would be for the convenience of the public if the Green Line could extend their service to allow a bus service to and from Westerham to one of the main London junctions?


I can only say at the moment that I should like to look at this point. I think that I have said enough to justify leaving these exceptional circumstances in the Bill.


This is an important point, and if we are adjourning now, I wonder Whether we could continue this discussion on Monday.


It might suit the convenience of your Lordships to adjourn the Committee now, and I beg to move that the House do now resume.

Moved, That the House do now resume.—(Lord Mills.)

On Question, Motion agreed to, and House resumed accordingly by the Lord Chancellor.

House adjourned during pleasure.

House resumed.