FURNITURE INDUSTRY DEVELOP MENT COUNCIL (AMENDMENT No.2) ORDER, 1964 (Hansard, 6 July 1964)

§ LORD DRUMALBYN
I beg to move that the draft Furniture Industry Development Council (Amendment No. 2) Order, 1964, which was laid before Parliament on Tuesday, June 23, be approved. Naturally, if any noble Lords would like a fuller explanation of this I should be glad to give it. The Order is subject to Affirmative Resolutions of both Houses of Parliament, and is made under the authority of the Industrial Organisation and Development Act, 1947. It amends for the second time the Furniture Industry Development Council Order, 1948, which set up a Development Council for the furniture industry.
To enable the Development Council to meet its expenses, Article 6 of the 1948 Order, as amended by the Furniture Industry Development Council (Amendment) Order, 1958, give the Council authority, with the approval of the Board of Trade, to impose levies on persons carrying on the designated activities, and paragraph (3) of Article 6 provides that any such charge shall be computed so as to yield not more than £30.000 in each year. The purpose of the Furniture Industry Development Council (Amendment No. 2) Order, 1964, is to increase the maximum amount of the levy which may be imposed by the Furniture Development Council on the industry to £75,000 per annum. Any such levy will continue to be subject to Board of Trade approval.
The research activities of the Furniture Development Council were taken over by the Furniture Industry Research Association on its establishment in 1961. The Research Association receives most of its industrial income through the Council 816 from the levy. Apart from its report from research and technical information, the Council itself continues to do much useful work and provides many services to the industry. These include method study and costing, statistical and economic services, educational promotional activity, including study tours abroad and the study of design and marketing. Many of these activities are self-supporting, so that the Council has been able to make available to the Research Association the greater part of the levy collected for each of the past three years, although this has meant drawing on its reserves.
The purpose of the proposed increase is to provide additional funds to enable the Furniture Industry Research Association to expand and maintain its programme of research. Revolutionary changes both in the utilisation of new materials and in new manufacturing techniques in the furniture industry have led to rapid expansion in the Research Association's work. The Association, together with the Furniture Development Council, have moved to new and larger premises at Stevenage. There is still a sizeable sum outstanding on the building, and with the new equipment and staff required expenses have risen sharply. After receiving a request from the Furniture Development Council to seek Parliamentary approval for an increase of the levy to a maximum of £75,000, the Board of Trade, in compliance with subsection (3) of Section 1 of the Industrial Organisation and Development Act, 1947, consulted the organisations representative of the manufacturers and of the trade unions in the industry. The British Furniture Manufacturers Federated Associations and the National Federation of Furniture Trade Unions support the proposed increase of the levy ceiling to £75,000. Accordingly, I ask your Lordships to approve the Order.

§ LORD STONHAM
My Lords, I am very grateful to the noble Lord for his careful and interesting explanation of the reason for this Order, but I should be glad if he would allow me to put one 817 or two points to him. First, I must declare an interest, as I am one of the contributors originally to the £30,000, and in future to the £75,000 which is proposed. I would say at once that I am wholeheartedly in favour of the principle of the Development Council and all it stands for, and in another place many years ago, and under another Government, I was a party to the Bill which enabled this Council to be formed.
I should like to ask the noble Lord whether there is any real evidence that the efforts of this Council, and the research in which it engages, have been translated into benefit for the industry in terms either of increased efficiency or, still more, of increased trade. I ask this because of the Council's publications given to me. Of course, I study them and I have yet to find one which has been of really firm, practical interest. They seem to me of a rather esoteric character. I have a very great admiration for the efforts of the present Director of the Council, who is now about to retire, but it does seem to me that their inquiries and efforts have not been sufficiently informed in a practical way. I am, of course, aware that the reason for this Order is approved both by the B.F.M. and by N.F.F.T.U., the trade union. But I am still not satisfied, and I was not satisfied some ten years ago when I made a similar point, and was thereafter asked to inspect the premises and saw some of the research that was then going on.
Finally, may I ask the noble Lord whether he could say if this £75,000 is, as it were, a "once-off job", in order to clear up the payment for the new premises, or whether when the new premises have been paid for there will still be demanded an annual contribution of some £75,000? It is the case that employment in the industry over the years has been steadily declining. Numbers employed in the industry over the past ten years have dropped by far more than one-third, and turnover in real terms has also declined, and still continues to decline. Therefore, I am putting the valid point to the noble Lord whether it is right to add 150 per cent. to the current charges to an industry which is in decline, and when, so far as I was able to hear, the noble Lord was not able to say that the 818 industry was receiving any real value for money.

§ LORD DRUMALBYN
My Lords, I think the noble Lord has asked me two main questions. First of all, dealing with the increase of the amount that can be raised—it will not necessarily be £75,000; this is to be the maximum—of course, the amount is a very small proportion, indeed of the turnover of the industry. At the present time, expressed as a percentage of the turnover of roughly £130 million a year, it amounts to 0.023 per cent., or a little more than one-fiftieth of 1 per cent. of the turnover; and the increased levy will amount to a little more than one-twentieth of 1 per cent. of the turnover of the industry.
The noble Lord asked me whether there was any evidence that research had been translated into action and into increased trade. On the general point, I should have thought, considering the close links between the Research Association and the industry, and the representation of the industry on it, that it would not have been likely that the industry would agree to a further amount unless it had been satisfied that the research was of value to the industry. I am told that in recent years projects of much value to the industry have been undertaken, and have included, for example, research into the uses and properties of particle board, and a structural analysis of cabinet furniture which has resulted in stiffer and stronger furniture.

§ EARL ALEXANDER OF HILLSBOROUGH
My Lords, may I ask whether this research organisation has paid any attention to research with regard to increasing the export of furniture?

§ LORD DRUMALBYN
My Lords, as I said, I think this is more a matter for the Furniture Development Council itself, rather than for the Research Association. But I mentioned in the remarks I made the activities of the Furniture Research Association, including, for example, study tours abroad and the study of design and marketing.