Lords Sitting of 25 June 1964

Preamble
The House met at three of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Worcester

POSTGRADUATE STUDENT AWARDS
3.5 p.m.
VISCOUNT ECCLES: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what was the number of awards offered to postgraduate students in 1959, and in the current year.]
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR EDUCATION AND SCIENCE (THE EARL OF BESSBOROUGH): My Lords, the number of postgraduate awards offered by education departments and the Research Councils in 1959 was 1,600. In the current year it will be over 3,700, including about 1,000 for the arts and social studies and about 2,700 for scientific and technological subjects.
VISCOUNT ECCLES: My Lords, in welcoming this encouraging increase since 1959, may I ask my noble friend two further questions? First, are the dependants' allowances generous enough not to deter married men from applying for these three-year awards? And, secondly, is he satisfied with the low proportion of women who obtain these awards?
THE EARL OF BESSBOROUGH: My Lords, with regard to allowances, it is possible for a married postgraduate to receive £175 a year for his wife, £60 a year for the first child, £40 a year for the second, and £35 for any further children. In my view, these allowances seem to be satisfactory. They are, of course, based on the advice of a Standing Advisory Committee, and, so far as I know, there have recently been no complaints. The allowances have, of course, increased since 1959.
VISCOUNT ECCLES: Can my noble friend say something about the women?
THE EARL OF BESSBOROUGH: So far as women are concerned, of course there is no special allocation for them in the number of awards offered, but last year women received about 26½ per cent. of the awards for the arts and for social studies but only, I regret to say, about 6 per cent. for science and technology. The low figure for the scientific awards does, unfortunately, show the relative lack of interest of women in postgraduate scientific work, and the Government would certainly welcome more women postgraduates in pure science, and particularly in applied science and technology. I am most grateful to the noble Viscount for having referred to this matter, and I hope that the ladies will note what we have said. But, overall, I think it must be admitted that this very considerable increase in postgraduate awards reflects considerable credit on those concerned.
BARONESS SUMMERSKILL: My Lords, as the noble Earl has invited the ladies to note what he has said, may I ask him this? Why is it that the proportion of women in both these groups is low-26 per cent. and 6 per cent.? Does he think it is because women are less intelligent than men? Secondly, would he let me know the proportion of women on the Advisory Committee?
THE EARL OF BESSBOROUGH: My Lords, I am afraid I have not got the composition of the Advisory Committee, but I will certainly let the noble Baroness know.
BARONESS SUMMERSKILL: If when the noble Earl examines the names in the Advisory Committee he finds it is all male, will he give an undertaking that he will see that some women are put on it? It is important because curiously there is a bias in the minds of men sometimes. Secondly, will he see, please, that not just one woman is on the Committee? Too often, as we know, the shop window is dressed in order to satisfy the conscience. Will the noble Earl see that women are dealt with equitably in this matter?
THE EARL OF BESSBOROUGH: My Lords, I will certainly look into this for

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the noble Baroness—and I am glad to see there are so many noble Baronesses in this House to-day.
LORD MORRISON OF LAMBETH: My Lords, if there is not a reasonable proportion of women on the Advisory Committee, I think that is worthy of consideration. But can the noble Earl say, as regards the proportion of women who get through, whether there is any fixed percentages of awards for men and women—I should have thought not; or are the percentages determined by those who happen to gel through the examination and qualify?
THE EARL OF BESSBOROUGH: My Lords, the last assumption is the correct one.
LORD CHORLEY: My Lords, may I suggest to the noble. Earl that the figures he has given show that there is an over-weighting in these awards in favour of science and technology as opposed to the social sciences and the arts? Has the noble Earl seen the very interesting researches which have recently been carried through which indicate that a great deal of the original thought on which we rely so much is carried out by people who are in the arts as opposed to the scientific faculties, and will he therefore see to it that the number of awards to the arts and social sciences is stepped up?
THE EARL OF BESSBOROUGH: My Lords, I do not think I can very well give that undertaking to the noble Lord. After all, our main objective at present is to encourage more and more people to go in for science and technology and especially applied science.
LORD HOBSON: My Lords, can the noble Earl state categorically whether male and female graduates doing postgraduate research in the same subject get the same allowances?
THE EARL OF BESSBOROUGH: I think they do, yes.
LORD TAYLOR: My Lords, the noble Earl gave us figures; for science, technology and the arts. Could he give us the figures for medicine as well?
THE MINISTER WITHOUT PORT- FOLIO (LORD CARRINGTON): My Lords, I wonder whether the noble Lord
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has looked at the original Question. It seems to me that my noble friend has been asked a great many supplementaries quite outside the scope of the original Question.
LORD REA: My Lords, may I ask one supplementary which I think is within its scope? We all know what an undergraduate is, and we all know what a graduate is. Can he tell us what a postgraduate is? Is he alive or dead?
THE EARL OF BESSBOROUGH: My Lords, the level of the questions this afternoon seems to me perhaps to have fallen a little, even if one has just come from the noble Lord the Leader of the Liberal Party. As a matter of fact, I can give to the noble Lord, Lord Taylor, the figure for medical research for 1963. I am afraid that for certain reasons, which I can explain to him later, I cannot give him the figure for this year, as it has not been finally fixed. But last year, in 1963, there were 153 awards given by the Medical Research Council.
LORD TAYLOR: My Lords, I thank the noble Earl for his answer. And am I not right in saying that my question was well within the original Question?
BARONESS SUMMERSKILL: My Lords, may I ask what proportion of those were women?
THE EARL OF BESSBOROUGH: I will certainly let the noble Baroness know.

WHITEHALL REBUILDING AND ALLOCATION OF ACCOMMODATION
3.8 p.m.
LORD REA: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government, in view of the rebuilding and replanning, proposed in the Whitehall area, whether the opportunity is being taken to examine as a whole the allocation of accommodation to the different Government Departments, on the basis of which Departments or sections of Departments need to be in close proximity to Downing Street and which could be moved further away, in order that the planning advisers appointed

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the Government shall be given the greatest possible facility to make useful long-term recommendations.]
THE MINISTER OF DEFENCE FOR THE ROYAL NAVY (EARL JELLICOE): Yes, my Lords. A study is being made of the allocation of accommodation in the Whitehall area having regard to the considerations which the noble Lord mentions, and indeed other factors. All possible information on these matters is being made available to the Government's consultant on the planning of the Whitehall area whom my right honourable friend the Minister of Public Building and Works has recently appointed.
LORD REA: My Lords, I am much obliged to the noble Earl. I am sure he will know that that Answer will give great satisfaction in many quarters.
LORD SILKIN: My Lords, can we be assured that before any final decisions are made the House will be informed of what they are, so that we may make intelligent comments on them?
EARL JELLICOE: My Lords, I think my right honourable friend has already given assurances in another place, or in a Press issue, that before he puts into effect any of the major proposals recommended to him by Sir Leslie Martin, the consultant concerned, he will bring them to the attention of Parliament.

WATER SUPPLIES AND NATIONAL GRID PROPOSAL
3.15 p.m.
VISCOUNT ST. DAVIDS: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will now consider the construction of a national water grid, in order to save the unhappy necessity for big cities to raid places of beauty for scarce water, and to make possible the announced expansions in the North-East and South-East.]
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (LORD HASTINGS): My Lords, the idea of a national water grid was considered
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by the Proudman Sub-Committee of the Central Advisory Water Committee. In their Report, they said:
"We consider it impracticable to contemplate for water anything in the nature of a national network of mains or 'national water grid' ".
The arguments leading to this conclusion are in the Government's view still valid. The Water Resources Act, 1963, provides for the orderly development of water supplies to meet the increasing demand with full regard to the need to protect natural beauty.
VISCOUNT ST. DAVIDSMy Lords, is the noble Lord satisfied that these arguments are still valid, in view of the recent examination of the future of the South-East where, as we know, a number of towns in Essex have largely drained the water supply available to them? Is he satisfied also that the arguments are valid for the North-East where, as we know, reservoir capacity cannot be increased any further than it is at present?
LORD HASTINGS: The answer is, yes, my Lords, we are absolutely satisfied as to the North-East; its potential will not be strained for many years to come. As for the South-East, a number of methods will have to be considered (I need not go into them: the noble Viscount will be aware of them all) and of course there is already a regional distribution in force. These arrangements, and the transfer of water between catchments, will be one of the studies that the Water Resources Board will have to carry out. We have no doubt that they will be able in this way to satisfy the demand of the expanding North-East and South-East.
LORD WAKEFIELD OF KENDAL: My Lords, may I ask my noble friend what progress is being made in underground storage of water? In view of the need to restrict the use of surface land for reservoirs, and the storing of water in that way, can he say whether any real progress has been made in storing water underground?
LORD HASTINGS: My Lords, I am afraid that that is an entirely different question, of which I should need notice. But I should be glad to answer it if the noble Lord would kindly put a Question on the Order Paper.

NEW FOREIGN OFFICE BUILDING
3.18 p.m.
LORD BOSSOM: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will consider holding an open architectural competition, with appropriate prizes, for a fresh design for the Foreign Office whilst keeping the existing façade to Whitehall and Green Park but pulling down all the remainder and replanning the interior with the object of getting the maximum accommodation on the existing site, or, if need be, including the building on the adjacent site.]
EARL JELLICOE: My Lords, Her Majesty's Government have given careful consideration to the suggestion that the new Foreign Office building should be designed in such a way as to retain the existing façades to Whitehall and the Park. They have, however, come to the firm conclusion that a scheme on the lines proposed by my noble friend would prevent the satisfactory development of the site and make it impossible to erect a functionally efficient, adequate or well-designed modern building.
LORD BOSSOM: My Lords, while thanking my noble friend for that comment, is it not a fact that the majority of the greatest buildings in the world—in fact the actual building we are in at this moment—have been selected by public competition? Is there any reason why we cannot find a way of doing that in this case? No individual or group of individuals has a monopoly of all the inventive qualities in architecture.
EARL JELLICOEMy Lords, I will naturally take note of what my noble friend has said; but he will know equally well that many fine buildings in this country, and in other parts of the world, have not been the result of public competition. I think there are certain reasons in this case why the design would not be susceptible to public competition. The requirement is highly specialised and most technical. We may not get all the best architects entering, but that is always a risk one runs.
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I think the main thing here, with a most complicated and technical requirement, is that it is most necessary for the client, my right honourable friend and the architect to be brought together from the start of the planning of the scheme. Perhaps I might add that it does not seem to me that the chequered history of the architectural competition for the Foreign Office building a century ago is necessarily a good precedent in this case.
LORD SILKIN: My Lords, would the noble Earl consider the possibility of inviting selected architects, who are capable of complying with the requirements, to put in their suggestions for the rebuilding—not necessarily opening the door to full competition? There are a limited number of architects who, surely, ought to be consulted, and perhaps from among them we might get some competition.
EARL JELLICOE: My right honourable friend has given careful consideration to this, and he feels that in this particular case it would be best not to open this rebuilding to competition. But, of course, the planning of the building as a whole comes under the umbrella of Sir Leslie Martin.
LORD GREENHILL: My Lords, would the noble Earl please tell us in what sense this building has specialised and highly technical conditions which do not apply to other buildings?
EARL JELLICOE: It has a number of specialised requirements, as I understand it. What precisely they are my noble friend behind me might know—providing for him is possibly one! This is, as I understand it, a building which will require careful technical planning.
LORD GREENHILL: May I put it in a more general sense? What kind of mysterious requirements are necessary in this particular building which demand a special kind of architectural distinction?
EARL JELLICOE: I am assured by my right honourable friend that this is the case; but, if the noble Lord would like to put down a Question on this particular point, I should be glad, having looked into the particular point more carefully, to give an answer.
LORD MORRISON OF LAMBETH: My Lords, if the Government are going to put up a much higher building for the Foreign Office, something of a skyscraper or something approaching a skyscraper, will they consult the noble Lord, Lord Bossom, who has considerable experience in the United States of building very high skyscraper buildings?
EARL JELLICOE: I am sure the Government would be glad to accept the noble Lord's suggestion, but I would suspect that if we did have in mind a high building on this particular site, which we do not, as I understand it, my noble friend would be very ready with his advice.
THE EARL OF SANDWICH: My Lords, when the architect has been selected, will the design be submitted to the Royal Fine Art Commission and be available for public comment and discussion before a decision is finally taken, in order to avoid the kind of embarrassment which we have had over, for example, the building in front of St. Paul's?
EARL JELLICOE: Yes, my Lords.
LORD SILKIN: My Lords, may I ask the noble Earl to ask his right honourable friend not too readily to reject the idea of a limited competition? It is worth more consideration than the noble Earl seems to have given to it.
EARL JELLICOE: It is, of course, not for "the noble Earl" to give consideration to this particular point; it is for my right honourable friend. But I will certainly bring to his attention the suggestion made by the noble Lord.
LORD BOSSOM: My Lords, is my noble friend aware of the amount of money spent by visitors who come to see the buildings which have been built by British architects here in England, and does he think that the same amount of money will come into the country, and give that amount of employment, if those people see here the same kind of buildings they can see elsewhere, in Chicago, and such places? Let us show them the fine things we have. Are we not doing a lot of damage by destroying these things, with no benefit to anybody?
EARL JELLICOE: If the noble Lord had put that question to me in the early eighteenth century, and with the same
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thing in mind, we should not have designed the Foreign Office building itself.

CYPRUS
EARL ST. ALDWYN: My Lords, I would inform your Lordships that at a suitable moment after 3.30 my noble friend the Leader of the House will be making a statement on Cyprus.
ISLE OF WIGHT RIVER AND WATER AUTHORITY BILL
Read 3a, with the Amendments, and passed, and returned to the Commons.
NEWCASTLE UPON TYNE CORPORATION BILL [H.L.]
Read 3a, and passed, and sent to the Commons.

STATUTE LAW REVISION (SCOTLAND) BILL [H.L.]
3.27 p.m.
THE LORD CHANCELLOR (LORD DILHORNE): My Lords, I beg leave to introduce a Bill to revise the statute law of Scotland by repealing obsolete, spent, unnecessary, or superseded enactments, and to facilitate the citation of statutes. I beg to move that the Bill be read a first time.
Moved, That the Bill be now read 1a—(The Lord Chancellor.)
On Question, Bill read 1a, and to be printed.

SCRAP METAL DEALERS BILL
Report of Amendments received (according to Order).
SPRAY IRRIGATION (SCOTLAND) BILL [H.L.]
Read 3a (according to Order): an Amendment (privilege) made; Bill passed, and sent to the Commons.
HIRE-PURCHASE (No. 2) BILL [H.L.]
Returned from the Commons, agreed to, with Amendments: the said Amendments to be printed.

CRIMINAL PROCEDURE (INSANITY) BILL [H.L.]
House in Committee (according to Order).
House resumed: Bill reported without amendment; Report received.

PHARMACY BILL
3.29 p.m.
Order of the Day for the Second Reading read.
LORD GRENFELL: My Lords, this is a small Bill and does not need much explanation. The Pharmacy and Poisons Act, 1933, followed by the Pharmacy Act, 1954, laid down that in order to practice pharmacy it was obligatory to be a member of the Pharmaceutical Society. Four years ago the Society was approached on behalf of pharmacists who belonged to the Exclusive Brethren and who objected on the ground of conscience, to being members of the Society, since this made them members of a body which included persons not of their religious belief. I am advised that some 26 persons are involved, and that they are perfectly willing to accept all the other obligations, both monetary and disciplinary. The Pharmaceutical Society did all they could to find a way around the problem, but were tied to the Act, and the names of these people were accordingly struck off the register. I am advised that a further six persons who have qualified since 1958 have been unable to register. In many cases this has caused hardship, since it has meant either the loss of livelihood or the acceptance of a job in a hospital, under supervision, at a greatly reduced salary.
It is an accepted fact in this country that no one should suffer for his religious beliefs, however extreme they may be. It may also be noted that Article 20 of the Universal Declaration of Human Rights issued by the United Nations stated:
"No one may be compelled to belong to an association".
To put this mater right my honourable friend the Member for Wycombe in another place introduced this very small Bill, and I believe it is one that will commend itself to your Lordships. I would point out that the power to waive the requirements of membership will be in the hands of the Registrar of the Pharmaceutical Society. I have had talks with him, and the Society are perfectly satisfied that there will be no risk of professional standards being lowered if this Bill is passed through Parliament.
My Lords, I feel that I should say that I have little sympathy with the beliefs
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of the Exclusive Brethren. But I firmly believe that religious beliefs honestly held, however extreme, should not be the cause of a loss of livelihood to a person who is in every way otherwise perfectly qualified to carry out the profession of his choice. For this reason, I agreed to sponsor this Bill in your Lordships' House, and I ask your Lordships to give it a Second Reading. Subject to what my noble friend Lord Denham has to say, I understand that Her Majesty's Government have no objection to this Bill. I beg to move that the Bill be now read a second time.
Moved, That the Bill he now read 2a.—(Lord Grenfell.)
LORD FRASER OF LONSDALE: My Lords, before the Minister replies, might one just ask what is the religion of these Exclusive Brethren?
LORD GRENFELL: My Lords, it is a very strict sect within Christianity. As I understand it, they are not allowed to associate in any way with anybody else who does not think on the same lines as they do. It is unhappy in some ways, in that it has been known to break up families; in other words, they cannot feed together or speak together. But it is within the Christian religion—and very fervently within the Christian religion, I may say, though perhaps not in the way we should all prefer to see it.
LORD FRASER OF LONSDALE: My Lords, how can they speak to a customer in the chemist's shop?
3.34 p.m.
BARONESS SUMMERSKILL: My Lords, this is a very curious little Bill, and the more I speculate on the motives of those initially responsible for persuading a Member to introduce this Bill, and for persuading the Government to support it, the more baffled I become. My concern is that this measure establishes a novel precedent which could be abused. We have heard to-day that this concerns 26 people of various sects in a profession. I was asking my noble friend how many he thought might be in this profession, but I should say the number is 30,000 or more. That is a conservative estimate of the number of pharmacists in the country, because I know that there are over 20,000 general practitioners, and I should say the

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number of pharmacists is probably nearer 50,000.
I would remind your Lordships that the Pharmacy Acts provide for every pharmacist to become a member of the Pharmaceutical Society; and registration, which involves a fee, is an essential part of membership. This entitles a pharmacist to work in a factory, as a trade representative, or to dispense prescriptions in a shop or hospital. I would remind the noble Lord, when he says that 26 people have been struck off the register, that unregistered pharmacists can, of course, work in factories, and they can work as trade representatives, so there is no question of these people being penniless. But only registered pharmacists, of course, can dispense in shops or hospitals.
Certain religious sects have decided that this membership is not compatible with their religious beliefs, and the noble Lord who rose just now asked what were their religious beliefs. We were told in another place that they want this Bill passed, because in 2 Corinthians, Chapter VI, verse 14, the Bible says:
"Be ye not unequally yoked together with unbelievers …".
The two sects which are principally concerned, I understand, are the Jehovah's Witnesses and the Plymouth Brethren. The Jehovah's Witnesses were founded in 1872, in Pennsylvania, and since then they have functioned under a number of names. I think they have changed their names about six different times. The Witnesses recognise Jehovah only, and they are opposed to accepting military duties. This I understand, because it is in conformity with the Quakers' attitude and the attitude of other sects. But it has no relationship to the work of an organisation which is of a highly ethical character, the Pharmaceutical Society. Furthermore, I would remind your Lordships that, when members of these sects applied for exemption from the Armed Forces, they were sometimes sent to hospitals as auxiliary workers; and I can never recall their raising any objection then to being yoked together with unbelievers.
It was said in another place—and the noble Lord, I think, has reflected it in his speech—that the sincerity of these members was such that they were prepared to pay the fees of the Pharma-
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ceutical Society. I think it should be mentioned here that, unless they paid the fees, they would not retain registration and ensure employment in every relevant field. Therefore, payment ensures their complete economic security in every such field. If they did not pay the fees they could still work. But paying the fees is not a great gesture; it is of course a gesture to secure their own employment. Again, I would say that the meetings of the Pharmaceutical Society are entirely voluntary. They often have a monthly meeting and they could have meetings of the branches in various areas, but nobody is compelled to go. Then why is it necessary for Parliament to introduce legislation to separate the Witnesses and Brethren from the unbelievers? I am wondering whether this is a test case and whether, having established this precedent, we shall be asked to grant special exemption for members of various sects in other fields in time to come. The provisions of this Bill are, of course, harmless, except that preferential treatment is given for no valid reason to a tiny minority. I say that if this were repeated later on for other organisations, a feeling of resentment might well be engendered among the majority. The Government supported this Bill. I take it that if we divided on it to-day the Government would put the Whips on and we would lose. But, my Lords, I do want to enter a caveat here, and say that I think that the principle behind this is totally wrong.
THE EARL OF SWINTON: My Lords, may I ask my noble friend who introduced this Bill, or the noble Lord who is going to speak for the Government, just one question which seems to me to be relevant? If these persons are admitted to be full practitioners as pharmacists, chemists, or whatever is the right name to call them, who is going to discipline them? As I understand it, the Pharmaceutical Society, which we know is an admirable body, has its own disciplinary body, just like the Law Society, which, again, as I understand it—the noble Lady will correct me if I am wrong—disciplines its members. Is that not right?
LORD OGMORE: My Lords, it does not discipline its members: it disciplines any solicitor who is on the Roll, which is quite a different thing.
BARONESS SUMMERSKILL: It has a disciplinary body.
THE EARL OF SWINTON: I am afraid I did not quite catch that observation, but the Law Society can discipline its members.
LORD OGMORE: No. The Law Society itself has no disciplinary power whatsoever. The Law Society can, if a complaint is made to it, refer the matter to a disciplinary committee, but is not a disciplinary committee of itself.
THE EARL OF SWINTON: Et ego in Arcadia vixit. I made my living at the Bar for a number of years.
LORD SILKEN: My Lords, if I may explain where the misunderstanding arises, the fact is that solicitors are not obliged to be members of the Law Society; there is no obligation on them to be members. Nevertheless, the Law Society has, by Statute, disciplinary powers over all solicitors.
THE EARL OF SWINTON: I am much obliged. Equally, just as the Bar Council has jurisdiction over all barristers, presumably somebody has jurisdiction over all pharmacists, either the Pharmaceutical Council or their equivalent; or has the power to move a reference to some legal committee. If a chemist misconducts himself, short of prosecuting him in the courts, I presume there is some way of dealing with him as a member of a very honourable profession. What I want to know is this. If there people are admitted to be full practitioners in this honourable profession, who is going to discipline them, and will they be subject to exactly the same forms of discipline, whatever else they may be, as other chemists who misconduct themselves?
LORD GRENFELL: My Lords, as I understand it from the Pharmaceutical Society, these persons have fully agreed to accept the discipline which has always been imposed by the Pharmaceutical Society. They have agreed to pay their dues.
LORD OGMORE: My Lords, in view of what the noble Baroness has said, I should just like to say that I have no sympathy with these people whatsoever: nor do I accent that their interpretation of the text from St. Paul which has been referred to is a correct interpretation. But
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the fact is that I commend the noble Lord, Lord Grenfell, for making this plea and I commend the Government for listening to it. It is all the more important to me that it is a plea from a small minority, because in my view civilisation depends upon whether we listen to small minorities. I think it will be a sad day for this country when we are not prepared to listen to small minorities, however ridiculous we think their views might be, so long as they are sincerely held.
So far as the Law Society is concerned, which has been referred to by the noble Earl, Lord Swinton, the fact is that membership of the Law Society is not obligatory upon any solicitor. A solicitor can join the Society if he so desires: if he does not there is no undue pressure brought upon him to do so. In fact, out of 20,000 or so solicitors, 18,000 belong to the Law Society and about 2.000 do not. I should have thought the profession we are now considering was analogous. Every solicitor has to be admitted to the Roll; and there arc certain disciplinary obligations upon the Law Society which bind all solicitors, whether or not they are members of the Society. It would be the same, as I understand it, with the Pharmaceutical Society.
The Law Society, which is in fact the trade union of solicitors, does not itself hear the cases. If a complaint is made to it, it instructs a firm of solicitors and they present the case to a separate body, the disciplinary committee, and the disciplinary committee then decide upon it. I think it is important from all points of view to realise that there is this separate disciplinary body—of course, all solicitors—to which a person is brought and to which he can make any defence that he feels obliged to make. I myself, unlike the noble Baroness, do not think that this Bill is an innovation in our law. I believe it follows exactly on the situation that we have in regard to solicitors in this country.
3.48 p.m.
LORD CRAIGMYLE: My Lords, I rise, a little later than might have been indicated by the typescript list, to give this Bill a somewhat chilly welcome. I am myself a member of a religious minority, and as a member of a religious minority I am naturally sensitive to things that may affect the lives, work

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and consciences of other minorities. But I am also sensitive to the danger which might be done if the plea of religious toleration and freedom of conscience were to be carried beyond its logical conclusion. There is a distinct danger that, if the plea of freedom of conscience were to be abused, the whole principle of religious toleration would fall into disrepute and that much suffering would ensue to all the minorities. It is not quite clear to me whether we are to-day considering something that oversteps the logical mark or not, but I am sure that the caveat should be entered.
The three questions one has to look at surely, in considering a question of this sort, are these. Who are the people who are seeking this relief and making this claim on the grounds of conscience? What is the matter of the claim that they are making, the privilege they are seeking? And what are the grounds upon which they seek it? I am interested to learn that the people who are behind this Bill include the Jehovah's Witnesses. I was not aware of that; I had assumed it was entirely the Exclusive Brethren—those Exclusive Brethren, that is to say, who accept the leadership of one Big Jim Taylor, Junior, an American saint. These gentlemen call themselves saints. Other people may call them differently, but they call themselves saints. The Taylorite Exclusive Brethren might be described as a hived-off section of a breakaway group of a dissenter sect.
The Plymouth Brethren, as your Lordships know, are a well-respected group with extremely strict ethical principles. The Brethren split many years ago—I do not know the exact date—into the Open and the Exclusive Brethren. The greater part of the Exclusive Brethren have now come under the influence of this man Taylor. It seems that he claims that he is in fact an Apostle. The claims he makes, I am told, would leave a mediæval Pope quite cold.
As the noble Lord, Lord Grenfell, has already said, some of the activities of these people have not been to the liking of the great majority of their fellow citizens. It is true that so strict are their principles about not associating with people who are not of their own sect that husbands will put their
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wives out of the house, children will not speak to their parents, and so forth. This is a very unpleasant aspect of their activities, but it is not an aspect of their activities with which we are dealing to-day. We are dealing to-day with only one matter—the matter which joins the registration of a pharmacist and his membership of the Pharmaceutical Society of Great Britain. Although this Bill says quite simply it is "An Act to amend the Pharmacy Act, 1954", your Lordships will recall that that Act is, itself, only a consolidating measure and the actual provision of law which this Bill seeks to amend was enacted in 1933.
It is true that this is unique among professional societies and associations. I am assured, as was said just now, that solicitors do not have to be members of the Law Society. I am told it is not essential for barristers to remain members of an Inn of Court. I was surprised to hear this; I did not know. Pharmacists are automatically members of the Pharmaceutical Society of Great Britain so long as they remain registered pharmacists. The mere fact that this provision is unique to pharmacists is not entirely surprising. The different professional bodies have all grown up with different histories and probably each one of them will point to something in its constitution which is unique.
The purpose of this particular connection is quite clear to see. The Pharmaceutical Society, and consequently the pharmaceutical profession, is governed by a Council consisting of 21 elected members and 3 members appointed by the Privy Council. Where the governing body of a profession is to so large degree composed of the elected members of the professional body, it is essential that the body concerned shall be representative not of a section but of the whole of the profession. It was with that in mind that Parliament in 1933 decided that as soon as a pharmacist registered he should automatically become a member of the Pharmaceutical Society. The Society, 7 understand, takes the view—and the noble Lord, Lord Grenfell, will correct me if I am wrong—that any grave breach in this now traditional connection between registration and membership would almost certainly lead to grave damage to the constitution and the working of the constitution of the Society. They do not feel,

329
however, that the very small number of exceptions which this Bill would allow would do any appreciable harm; in other words, the separation which this Bill will allow between registration and membership would be damaging in principle but not seriously damaging in practice, because the use made of it would be negligible.
What are the grounds on which exemption is sought? Here I have nothing left to say, because it has all been said for me by the noble Baroness opposite. There seems to me neither rhyme nor reason in the claims put forward by these gentlemen. But, having said that, I would add that there is one other point which some of your Lordships have already noticed and upon which I may perhaps give a slightly different emphasis. When a minority makes a claim to a right, the public is entitled to ask, though it seldom does ask consciously, but often unconsciously: "What pledge do you give of your bona fides? How do we know that this is not just a device with some hidden meaning that you have not yet revealed?" I think the answer is always the same. Again, it is never given consciously; but it seems to happen. The minority, who feel themselves, rightly or wrongly, to be oppressed, show the genuineness of their objections by being prepared to undergo considerable suffering rather than to acknowledge the law which they dislike. The noble Baroness has ventured to say—and I think she is probably right—that the amount of suffering that these people would undergo by ceasing to be registered pharmacists would, in fact, not be very great. That is so, if they are prepared to accept lower remuneration and a professional life with no future in the way of ambition to it.
BARONESS SUMMERSKILL: My Lords, may I interrupt the noble Lord? A medical representative of a drug firm today earns very much more than a chemist in a chemist's shop or in a hospital. They would be able to do that.
LORD CRAIGMYLE: I am obliged to the noble Baroness for that. Nevertheless some of these people, I am told, have sold up their own businesses and started out in different lines of work. I think on that score they are entitled to the benefit of the doubt. One knows— one sees it often—that a fool is pre-
330
pared to suffer for his folly; but when a man says he is suffering on religious grounds he is entitled to the benefit of the doubt. A pledge of suffering has been offered and Parliament can redeem it by granting this small Bill. If any of your Lordships will walk towards Victoria and look into the Cathedral you will see there the body of a Recusant priest who was content to be hanged, drawn and quartered rather than deny his godly calling. Or, if you would step towards the City and go into Farringdon Street, you will see a large and ugly building with an engraved stone on it reminding us of the fidelity of conscience of the ejected Ministers of 1662.
You may say that I am comparing a mountain with a molehill; but I would give these people the benefit of the doubt. It was by the suffering of the Recusants and the non-jurors that the religious liberty of the minorities which is enjoyed to-day came into being. It may now be that Parliament is entitled to say: "Yes, we will take up the pledge you have given us of your sincerity and we will grant you this relief." However, like the noble Baroness opposite, I do not think we have heard the last of this particular sect, and it may be that in some other context they will form the subject matter of a debate in your Lordships' House in the future.

CYPRUS
LORD CARRINGTON: My Lords, I wonder whether I might interrupt this debate and repeat a Statement which has been made in another place on Cyprus. The Statement is as follows:
"By its resolution of the 20th June, the Security Council extended the mandate of the United Nations Force in Cyprus for a further three months. The Secretary-General thereupon invited the Governments which are at present contributing to the Force to continue to do so.
"We explained to the Secretary-General that, for reasons which are well understood, the British Government were anxious if possible to be relieved of this duty. U Thant, however, emphasised that the British troops were playing an essential part

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in the United Nations Force, not only by participating in the peace-keeping task but also by providing the logistic and other services for the Force as a whole. The withdrawal of our contingent would therefore seriously weaken the effectiveness of the whole operation. U Thant at the same time informed us that he had consulted the other Governments concerned, including those which are contributing contingents, as well as the Governments of Greece, Turkey and Cyprus, and that it was the desire of all these Governments that Britain should continue to participate.
"In view of the Secretary-General's strong representations and of the importance we attach to the United Nations Mission in Cyprus, we have, after careful consideration, agreed to contribute troops for a further three months, although on a somewhat reduced scale.
"Our contingent will be reduced to between 1,100 and 1,200 men and will be composed of one infantry battalion, a squadron of armoured cars, a contribution towards the Headquarters Staff and the troops required to provide supporting services.
"In agreeing to continue to participating in the United Nations force, we have made it clear that we expect the Cypriot authorities and the Secretary-General to take all possible steps to ensure that our troops are treated with proper respect and courtesy."
LORD SILKIN: My Lords, I welcome this Statement from the noble Lord. We are very glad that the Government see their way to comply with the request of the United Nations and to retain our Force in Cyprus for a further three months. We also welcome the fact that, to a certain extent, we are reducing the size of that force. We hope that three months will see the end of the trouble. I am glad we are making a condition or, at least, making representations about the proper treatment of our force. I hope that comprises proper respect for the families of our men, their wives and other dependents, because in the past they have not had the treatment they are entitled to expect. I hope we are trying to get positive assurances as to their proper treatment.
LORD REA: My Lords, we from these Benches welcome the Statement. I think that is a complimentary Statement. It shows that we are needed in that part of the world but, in a sense, it is a bit of a back-handed compliment, because we are still expected to bear a great deal of the brunt. I appreciate the difficulties the Government are in and should like to support them, but I hope that, during the further three months, all necessary steps will be taken to try to persuade other nations to take more responsibility and relieve us of the duties we have undertaken at considerable inconvenience.
LORD CARRINGTON: My Lords, I am obliged for what both noble Lords have said. I do not think I disagree with anything they have said.
LORD CONESFORD: My Lords, may I ask if my noble friend can inform us whether the Cypriot Government controls Grivas or Grivas controls the Cypriot Government?
LORD CARRINGTON: My Lords, I think that I should prefer not to comment on that aspect until the situation is rather clearer.
THE EARL OF SANDWICH: My Lords, would my noble friend be good enough to confirm and state specifically that the British Government have agreed to stay in Cyprus under the United Nations, albeit on a diminished basis, without securing from the United Nations a new directive giving them authority to disarm Greek and Turkish irregulars, if necessary? Have we not come to any conclusion about this grave matter, seeing that General Grivas has arrived in Cyprus and is himself, so it appears, disciplining his own forces? Are we expecting him to do the job the United Nations ought to be doing?
LORD CARRINGTON: My Lords, my noble friend will be aware that we made representations on this aspect of the matter to the Secretary-General of the United Nations and he has given us an assurance that the Commander of the Force will interpret his terms of reference, which your Lordships will know, in a positive and vigorous fashion.
LORD OGMORE: My Lords, in making this very generous offer to the United Nations, have the Government

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made any stipulation about the return of Major Macey and his driver, who have apparently been captured by the Greeks? If not, will they continue to press for some action in this regard?
LORD CARRINGTON: My Lords, there has been no stipulation about that, but of course we are making every effort in every possible way to find out the whereabouts of Major Macey and Driver Platt. Unfortunately, so far we have had no success of any kind. We are now proposing to offer a substantial reward for information leading to the discovery of Major Macey and his driver and of those who abducted them.

PHARMACY BILL
4.5 p.m.
Debate on Second Reading resumed.
LORD TAYLOR: My Lords, I think it is our duty in this House to try to legislate with logic and reason, and with humanity. Humanity and tolerance, however, do not mean that we should accept the word of every crank that he has the right of exemption from the ordinary law of this country. I have seen something of the activities of these Exclusive Brethren and my experience has been very much like that described by the noble Lord, Lord Craigmyle. As he says, they are a breakaway from an American sect, and if we are going to legislate for every such breakaway, Heaven help us!
These people are asking for tolerance for themselves. They show very little tolerance for others. They are unbelievably cruel to people who are involved with them by marriage. I have seen utter misery produced as a result of their demanding that a person who was a chartered accountant should give up his chartered accountant's qualifications because he was married to one of the Exclusive Brethren. Immense family pressure was brought to bear. His wife refused to eat with him and his children were instructed not to eat with him. I dare say, as the noble Lord, Lord Craigmyle, surmised, in due course we shall be asked to give them legislative release from the necessity to register as chartered accountants. How they can logically register as pharmacists and then opt out of the Pharmaceutical Society,
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I fail to understand. How they can register as doctors and fulfil their alleged faith, I fail to understand. I think the whole thing is terrible and dangerous nonsense, and the sooner we reject this Bill the better.
LORD FERRIER: My Lords, I hesitate to take part in this debate, because I have no opinion about the Brethren concerned, but I am concerned with the Pharmaceutical industry, though not a member of the Pharmaceutical Society. I am also a Scotsman, and the funny thing about this Brotherhood, about which we have heard such a lot—probably more than we need have heard in connection with this Bill—is that it is mainly Scottish. I do not know whether it is the climate, the water or the air. I agree with everything the noble Lord opposite said about the cruelty and the extraordinary situations which arise among these people. But, after listening to the debate, there are two points that I feel I might draw to the attention of your Lordships. The noble Lord, Lord Fraser of Lonsdale, asked: how did they talk with people in their shops? The same applies to customers, and we have not heard anything about the public or the customers in this matter. I am right in saying that this is one of the problems. They live in these extraordinary communities and it is a great inconvenience, to say the least of it, to the Brotherhood, if there is no pharmacist to whom they can talk.
The other point I want to make is this. As the noble Lord, Lord Ogmore, said, the pharmaceutical qualification is unique in that by Statute a pharmacist cannot practise unless he is a member of the Society. And this little Bill is solely designed to obviate that proposition, which means that if pharmacists are not members of the Pharmaceutical Society, and the law is not altered, they cannot practise as pharmacists. The noble Lord, Lord Grenfell, said that they could get other work, based on their training, but with considerable sacrifice. As the noble Lord, Lord Craigmyle, said, sacrifice is their affair. But it so happens that I am associated in business and friendly with the President of the Pharmaceutical Society, who is now abroad. When I last saw him, I took the opportunity of asking about this Bill—was it all right? The answer he gave me was, "Yes, it

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seems to be the only way out of a complex situation which arises from the extraordinary beliefs of these people and which concerns, not only their livelihood, but also the services which are required by other members of the Brotherhood."
I feel strongly in agreement with what the noble Lord, Lord Ogmore, said: that this Bill, which deals with the extraordinary situation arising out of a fanatical minority, does not pose any difficulty to Parliament, and I believe that your Lordships would be wise to give it a Second Reading.
4.10 p.m.
LORD ILFORD: My Lords, I feel a certain amount of confusion, and I think some other noble Lords may feel confused, too, over this obscure but important question of disciplinary control. We have been told, as I understood the noble Lord who introduced the Bill, that when these persons for whose benefit it has been brought forward cease to be members of the Pharmaceutical Society they will accept voluntarily the disciplinary control of the Pharmaceutical Society. We have also been told by the noble Lord, Lord Ogmore—and he may be right—that whether they are members of the Pharmaceutical Society or not, they will still continue to be subject to disciplinary control by that Society or by some other body, appointed, I suppose, by the Pharmaceutical Society. Which of those two sets of circumstances is the case, I do not know. I hope that when the noble Lord comes to reply he will make it clear to us what the control will be when these persons cease to be members of the Pharmaceutical Society. To my mind, that is the most important aspect of the whole matter.
I find it difficult to be very sympathetic to these 26 persons, out of 7,000, who desire exemption, but, at the same time, there is force, I think, in the argument of the noble Lord, Lord Ogmore, that that is, after all, the way in which our democratic society proceeds. But it is important, and, indeed, essential, in the interests of the public, that these persons should continue to be subject to the same disciplinary control as they would be if they were members of the Pharmaceutical Society.
4.12 p.m.
LORD GREENHILL: My Lords, I hope it will never be said of your Lordships' House that it placed any obstacle in the way of any man's observance of his religious beliefs, if honestly held, and if socially they are not harmful to the community. I think we are here to-day on a wrong tack altogether. What is being asked for here is that a certain privilege should be given, under the guise of a Pharmacy Bill to a small section of the people. With respect, my own point of view is that if there is a small body of opinion in this country which needs protection of this kind, then it should be given under some Bill, with a heading such as "Exclusive Brethren Bill" and not under the umbrella of a Pharmacy Bill. That would be one method of dealing with a small group of people who feel that they are being unfairly treated. It should not be done in the form of a Bill dealing with matters relating to pharmacy, under the guise of preventing hardship to a few people whose views may be objectionable to a great many people and, in my view, are irrelevant to the main purpose of the Bill.
4.14 p.m.
LORD CONESFORD: My Lords, I feel some difficulty about this Bill, even after the admirably clear and interesting speech of my noble friend Lord Craigmyle. It seems to me rather ridiculous to say that we are interfering with this small minority in the practice of their religion. The utmost that we could be held to be saying is that they cannot be registered as pharmaceutical chemists. That is really distinct from interfering with people's religion. It may be, under the present law, an inevitable consequence of their religion that they cannot become registered pharmaceutical chemists. It is also, so far as I can see, an effect of their religion that they cannot become barristers. I cannot pretend that that fills me with any great alarm, but their religion clearly would forbid them from becoming members of one of the four Inns of Court, and, as that is the only method of becoming a member of the Bar, they cannot become barristers.
I should like to know from my noble friend who is to give the Government's view how many professions they are debarred from entering at the present

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moment. The noble Baroness, Lady Summerskill, said that we should be setting a precedent; and I think she may be right. I feel that we should know how far this is likely to be extended. I should like to see a list, if the Government can provide one, of the professions and occupations which these people feel they are at present debarred from joining on religious grounds, and to know how much legislation would be necessary on the analogy of this Bill.
I quite agree with the point made by the noble Lord, Lord Ogmore, that, if we simply consider this particular profession, this Bill is harmless. But I think we should be careful of the precedent we are setting, and draw a fairly clear distinction between saying that people should be free to practise their religion, and saying that, because of their religion, we have to change a great many laws of the land.
4.16 p.m.
LORD SILKIN: My Lords, I do not want to prolong this debate unduly, but I want to make it quite clear that this is a Private Member's Bill and each one of us is free to support it or not, as we please. My noble friend Lady Summerskill (I am sure she will not mind my saying this) was speaking entirely for herself, and not for the Opposition; but I am sure she will receive a good deal of support, not only from the Opposition but also from a great many noble Lords on the other side of the House. I would ask that we should each of us look at this question on its merits, and decide for ourselves whether we want to support the Bill or not.
I think the greatest condemnation of this Bill was given by the noble Lord, Lord Craigmyle, when he said that this was damaging in principle, but not in practice. Do we want to support a Bill which is damaging in principle? For my part, I am sure the principle that a person should, under the guise of religious conviction, opt out of the law of the land which is at the moment applicable to all pharmacists is a bad one. Do we really want to support something which, to my mind, is quite irrelevant to pharmacy, and to say that this should be a reason for opting out of the provisions of the Pharmacy Act?
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There is also a good deal in what the noble Earl, Lord Swinton, said about the control over pharmacists. If you are not a member of the Pharmaceutical Society, there is a weakening of control. But I do not want to enter into the merits of this matter. I am concerned with the principle that, on something which, to my mind, is quite irrelevant to the question of whether you are a member of the Pharmaceutical Society, you should be able to opt out at your leisure. Therefore, I hope that every noble Lord will consider on this question of principle whether or not he wants to give a Second Reading to this Bill.
4.20 p.m.
LORD SOMERS: My Lords, I will not keep your Lordships more than two minutes, but I sincerely hope that the Government will not accept this Bill. I say that with some hesitation, because I know my noble friend Lord Grenfell well enough to know that he would not support any Bill that he did not consider was absolutely just. But we are living in an age when sectarian barriers are being broken down. We remember with reverence and affection His Holiness the late Pope John and his relationship with our own Primate, and also the hope of a greater union between the Roman Catholic Church and our own. There was also a meeting, I believe, between the Methodist Church and our own, in the hope that there might be a union of Communion between the two. I feel that the sectarian barriers should not be allowed to become so strict that, as the noble Lord, Lord Silkin, has said, they interfere with the law of the land.
LORD DOUGLAS OF BARLOCH: My Lords, may I venture to suggest that a great deal of this discussion has proceeded upon the assumption that Parliament was entirely wise in passing the legislation which made membership of the Pharmaceutical Society compulsory upon everybody who qualified himself as a pharmacist? If that principle is to be applied generally, a great many curious consequences will arise. It is not necessary that a man should be a member of the British Medical Association in order that he should practise as a doctor; nor that he should be a member of the British Dental Association in order that he should practise as a

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dentist; nor a member of the Law Society in order that he should practise as a solicitor. Most of the members of those professions do, in fact, join the appropriate society, but are we to contemplate that it is a desirable thing that members of every occupation should be compelled to join some society which deals with that particular occupation, whether they wish to do so or not?
Is it not worth while considering for a moment whether it was not a mistake in the beginning to impose this requirement? I am not talking about the necessity for discipline or anything of that kind. Before membership of this Society was made obligatory upon those in the pharmaceutical profession, they were subject to discipline, and they could, if necessary, be removed from the register. This is something which is entirely separate from professional qualification and professional discipline, and I do not see that the issue should be confused by bringing in those points.
LORD GARDINER: My Lords, before the Minister replies, may I ask one question? Many years ago, I used to be Chairman of the Statutory Committee of the Disciplinary Committee of the Pharmaceutical Society—everybody else, of course, was a pharmacist. My recollection is that it is a Privy Council appointment, and a statutory Committee. If it is a statutory Committee, it can have powers only over those persons over whom it is given powers by Statute. I did not quite follow the statement that these gentlemen would be prepared to submit to those disciplinary powers; because either they are among the persons over whom the statutory Committee have powers or they are not. If they are not, the statutory Committee would not have powers over them.
LORD DOUGLAS OF BARLOCH: They are registered and, therefore, would be subject to discipline.
THE EARL OF SWINTON: My Lords, dealing with the point the noble Lord, Lord Silkin, and I made, if the House gives this Bill a Second Reading, will the Government see that there is inserted in it a qualitative provision that if these persons are admitted to practise as full pharmacists, they should be made by Statute subject to exactly the same dis-
340
ciplinary measures as the regular members of the Society?
4.25 p.m.
LORD DENHAM: My Lords, my noble friend Lord Grenfell has given such a clear exposition of the text of this Bill that, in spite of the width the debate has ranged over since then, I do not think your Lordships will wish me to add anything. With regard to the merits of the Bill, if your Lordships feel that my noble friend has made out a good case for it, Her Majesty's Government would not wish to dissuade you from giving it a Second Reading. As this is a Private Member's Bill, and as Her Majesty's Government are neutral on this point, it is really not for me but for my noble friend to reply to the various questions that have been asked. But as the noble Baroness suggested that perhaps Her Majesty's Government should not be neutral on this point, but should have been against it, I think I must say something to give the reasons for neutrality.
It would not be proper for me, from this Dispatch Box, to follow those of your Lordships who have commented on the rights or wrongs of a religious minority. But, perhaps, the useful thing to do would be to say something more of the history of Section 14 of the Pharmacy Act, 1954, which we are discussing. Before 1933, there was no compulsion on a pharmacist to be a member of the Pharmaceutical Society. There was a form of registration, but it did not quite take the form it is in to-day. In fact, because pharmacists did not have to be members of the Pharmaceutical Society, in 1933 only about 60 per cent. were. The Departmental Committee on the Pharmacy and Poisons Act reported in 1930 to the Lord President of the Council on the Pharmacy Acts, and they thought that the comparatively small number of pharmacists who were members of the Society was weakening it. Therefore, Section 1(1) of the Pharmacy and Poisons Act, 1933, made it obligatory for a registered pharmacist to be a member of the Society. Hence Section 14 of the Pharmacy Act, 1954, which consolidated the 1933 Act, among others.
I should like to make it clear, bearing in mind the background, that so far as the control of pharmacists is concerned, registration is the important point. The

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object of compelling pharmacists to be members of the Society (what the provision says is that when a pharmacist becomes registered, he automatically becomes a member of the Society) was to strengthen the Society; it was not done from the point of view of keeping an eye on the pharmacist himself.
The noble Baroness, Lady Summer-skill, said that registration is an essential part of membership. But that is putting it the wrong way round. Membership is really an essential part of registration, because it is registration that is the important point: it is on the registration that any discipline of a pharmacist is maintained. I should like to assure my noble friend Lord Swinton that the Pharmaceutical Society, when they maintain discipline among pharmacists, would have just as much ability to do so on a registered pharmacist if he was not a member of the Society, if the Bill goes through, as they would on one of their own members.
My noble friend Lord Ilford referred to what my noble friend Lord Grenfell said about the discipline of these Exclusive Brethren in volunteering to come under the Society's control. That, if my noble friend will forgive me, is not quite what I understand. I understand that legally they have exactly the same discipline as any other pharmacist. That, I think also answers the point raised by the noble and learned Lord, Lord Gardiner.
Section 14 of the 1954 Act, if repealed altogether, as I think the noble Lord, Lord Douglas of Barcloch, was suggesting, might lead to what the Committee in 1930 wanted to avoid— the weakening of the Society. It might be possible that if everybody, irrespective of religious convictions, was able to opt out of the Society, the number might eventually go back to 60 per cent. of the total. Her Majesty's Government feel that the action taken by the few who would take advantage of this Bill would not unduly weaken the. Society. My noble friend Lord Conesford asked me whether this was the thin end of the wedge, and whether, in fact, there would be a large number of other societies from which this particular sect would wish to opt out. My information is that there are no other professions in England where a statutory provision
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exists on the lines of Section 14 of the Pharmacy Act. It is understood that a similar state of affairs applies to solicitors in Scotland. This is the only other case of which I am aware.
My Lords, I should like your Lordships just to consider this, that this Bill does not apply exclusively to one religious sect. Clause 1 seeks to add to Section 14 of the 1954 Act:
"Provided that any person who satisfies the registrar—

(a) that he has a conscientious objection to being a member of the Society, and

(b) that his conscientious objection is based upon religious beliefs which he shares with others,

shall not by virtue of registration become a member of the Society or, if he is a member of the Society, shall cease to be a member thereof."
So, in fact, although my information is that only one sect wishes to take advantage of this Bill, the same course is open to anybody who feels on religious grounds that he cannot join the Society.
4.34 p.m.
LORD GRENBELL: My Lords, I am exceedingly grateful to my noble friend Lord Denham for his words on this Bill, and I am also exceedingly grateful to everyone who has spoken. I think I must reiterate what my noble friend Lord Denham has said as regards discipline. This Bill is to allow for the registration of this small minority without their being members of the association. The registration allows for the discipline; not membership of the association. Once the man is registered and has paid his fees, he comes under the full discipline of the Pharmaceutical Society.
The noble Baroness, Lady Summerskill, mentioned that this is a novel precedent. I do not see that myself, because, as my noble friend Lord Denham has said, this is a unique situation. I have discussed this with the solicitor of the Pharmaceutical Society, and he has no knowledge of any other society to which Statute demands that the people practising should belong. The noble Lady also mentioned the Jehovah's Witnesses and Plymouth Brethren. These, I know, were mentioned in another place as the Bill went through. But I am advised by the Pharmaceutical Society that at the present time neither of these sects has come forward and re-

343
fused membership; it is only this one sect which has done so.
LORD MORRISON OF LAMBETH: Which sect is that?
LORD GRENFELL: The Exclusive Brethren is the only one. The Jehovah's Witnesses and Plymouth Brethren have not come forward and refused acceptance. I must point out, as noble Lords will already know, that this Bill has passed through another place; but that is merely by the way. I would say to the noble Lord, Lord Greenhill, that this Pharmaceutical Bill is really an Amendment Bill to the 1954 Act. My honourable friend in another place told me in a letter that
Resolved in the affirmative, and Bill read 2a accordingly.
if he had seen the difficulty which was going to arise he would have incorporated these clauses in the original Bill. I do not think this is going to be damaging in principle, and I hold most firmly that it would be wrong for us to cast out this Bill and so refuse to recognise the religious feelings of a small minority, however strange, as I have already said, those feelings may be. I cannot withdraw this Bill, and I ask your Lordships to give it a Second Reading.
4.40 p.m.
On Question, Whether the Bill shall be now read 2a?
The Lordships divided: Contents, 40; Not-Contents, 37.

CONTENTS

Ailwyn, L.

Ferrers, E.

Meston, L.

Amulree, L.

Ferrier, L.[Teller.]

Ogmore, L.

Blackford, L.

Fortescue, E.

Rea, L.

Brecon, L.

Gardiner, L.

Redesdale, L.

Cawley, L.

Goschen, V.

Samuel, V.

Champion, L.

Grenfell, L.[Teller.]

Sandys, L.

Coleraine, L.

Harvey of Tasburgh, L.

Sandwich, E.

Colville of Culross, V.

Henley, L.

Shackleton, L.

Congleton, L.

Horsbrugh, B.

Shepherd, L.

Daventry, V.

Iddesleigh, E.

Sinha, L.

Denham, L.

Ilford, L.

Spens, L.

Douglas of Barloch, L.

Luke, L.

Tenby, V.

Drumalbyn, L.

McNair, L.

Williams, L.

Dudley, L.

NOT-CONTENTS

Albemarle, E.

Greenhill, L.

Salisbury, M.

Alexander of Tunis, E.

Hobson, L.

Silkin, L.

Attlee, E.

Ironside, L.

Soulbury, V.

Auckland, L.

Killearn, L.

Southwark, L. Bp.

Boston, L.

Longford, E,

Spencer, E.

Burden, L.

Mabane, L.

Strang, L.

Conesford, L.

McCorquodale of Newton, L.

Strange of Knokin, B.

Crook, L.

Margesson, V.

Stuart of Findhorn, V.

Darwen, L.

Massereene and Ferrard, V.

Summerskill, B.[Teller.]

Elliot of Harwood, B.

Merrivale, L.[Teller.]

Taylor, L.

Falkland, V.

Milverton, L.

Wolverton, L.

Forster of Harraby, L.

St. Davids, V.

Worcester, L. Bp.

Fraser of Lonsdale, L.

Bill committed to a Committee of the Whole House.

TRADING STAMPS BILL
4.45 p.m.
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—(Viscount Colville of Culross.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD AILWYN in the Chair.]
Clause 1 [Restrictions on persons who may carry on business as promoters of trading stamp schemes]:
On Question, Whether Clause 1 shall stand part of the Bill?
LORD SHEPHERD: May I put one point in regard to Clause 1? The noble Viscount may be aware that in the Protection of Depositors Act, 1963, certain provisions in regard to private companies were made, basically, as I understand it, to give added protection to the depositors in regard to private companies. I would draw his attention particularly to Section 31 of the Companies Act, which deals with the number of shareholders in a company, to Section 222 which deals with the power of the courts to wind up a company when that number falls below a certan number, and to Section 224(1)(a)(ii), which deals with the question of a contributor seeking power to wind up the company. I do not know whether there is any explanation why these particular sections have not been included in this Bill, whereas the general principle, I think, is very much the same in the Protection of Depositors Act and in this particular Bill.
VISCOUNT COLVILLE OF CULROSS: It is perhaps a bad augury at this Committee stage that the opening batsman has been bowled out first ball by the noble Lord opposite, but I have to tell him I cannot give him a definitive answer with regard to the difference which is certainly there between Section 4 of the Protection of Depositors Act, 1963, and Clause 1 of this Bill. I think a certain distinction arises because the list of sections to which the noble Lord referred are applicable to private companies, whereas the rest of the provisions in my Bill refer to exempt private companies,
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and it was only the provisions with regard to exempt private companies which were thought suitable to put in the Trading Stamps Bill. It may be it ought to be extended, but I am afraid I cannot tell the noble Lord whether or not that is so. I shall be delighted to look at it before the next stage.
LORD SHEPHERD: I am grateful to the noble Viscount. I apologise; I did not intend to bowl him out. I am guilty in that I should have put an Amendment down, but we have been occupied with other matters. If he will look at this point I shall be most grateful.
LORD SHACKLETON: I also have been looking through the Companies Act. Perhaps the noble Viscount would take a look. I realise that at the moment the Bill is confined to exempt private companies. There are certain other protections for private companies which are not exempt, but there are one or two that ought to be applied in the Bill.
VISCOUNT COLVILLE OF CULROSS: I will look at it.
Clause 1 agreed to.
4.50 p.m.
BARONESS ELLIOT OF HARWOOD BARONESS ELLIOT OF HARWOOD moved, after Clause 1, to insert the following new clause:
Conditions for promotion of trading stamp schemes
".—(1) No company or society shall carry on business as promoters of a trading stamp scheme unless—

(a) they are registered with the Board of Trade as such promoters, and

(b) they have deposited, under arrangements made by the Board of Trade, £2,500 as security against their default on any liability arising from the issue or delivery of their stamps.

(2) In addition to the sum mentioned in paragraph (b) of the foregoing subsection, the promoters of a trading stamp scheme—

(a) shall deposit as mentioned in that paragraph the sum of £2,500 when fifty million of their stamps have been issued and have neither been redeemed for cash nor exchanged for goods, and

(b) shall thereafter make deposits as aforesaid at the rate of £2,500 for every additional twenty-five million of their stamps so issued and neither redeemed nor exchanged.

(3) On the winding-up or liquidation (whether voluntary or not) of any company or society registered as promoters of a trading stamp scheme any liability arising out of any

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trading stamp delivered but neither redeemed for cash nor exchanged for goods shall rank for dividend immediately after debentures."
The noble Baroness said: The first Amendment which I am about to move refers to the registration of stamp promoters. This is in order to protect people from the fly-by-night operators who may come in on this particular type of business. We suggest that there should be a deposit of a substantial sum before a stamp company can be registered and start operating. The progressive deposits suggested are at the rate of £2,500 for every 25 million stamps outstanding. In terms of a cash option set at one-quarter of 1 per cent. of the expenditure on postage, 25 million stamps would be worth about £7,500. But it has to be borne in mind that of every 100 stamps issued, possibly 50 are exchanged fairly rapidly, while as many as another 20 may be lost or destroyed. Of those outstanding, therefore, probably 30 out of the original 100 would actually be in existence, and many holders of these might have so few as not to make it worth while to press a claim for compensation.
It is not the aim, in the figures that I have quoted, to provide 100 per cent. security for the holders of outstanding stamps; the idea is to give partial security, supplemented by an inherent unlikelihood that a company which can put up the deposit recommended will go into liquidation. It will either put up the cash or satisfy an insurance company or a bank that its credit is good enough to justify the issue of a bond to the extent of its liability, which at the beginning would be only £2,500. Some companies approached by the Consumer Council have agreed that the deposit suggested would not be too onerous a burden for a properly established business. I think that the Committee will agree that any Amendment or any legislation should be directed towards seeing that these businesses shall be properly established.
I have added a subsection (3), which provides for the earmarking of the deposit to meet collectors' claims immediately after those of debenture holders. I understand from a conversation that I had with the noble Lord, Lord McCorquodale of Newton, yesterday that people entitled to wages have a preference
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immediately after debenture holders in the event of liquidation. It will therefore be necessary, on the Report stage, to mention the fact that wages are second in the order of payment on a liquidation. But I would beg that, in the event of a company going bankrupt, the holders of stamps should have precedence over normal trade creditors, since in fact they are in possession of stamps which they have earned by their purchases. I beg to move that this new clause be inserted after Clause 1 of the Bill.
Amendment moved—
After Clause 1 insert the said new clause.—(Baroness Elliot of Harwood.)
THE MINISTER OF STATE, BOARD OF TRADE (LORD DRUMALBYN): The noble Baroness has moved this new clause in a most persuasive way, and I am bound to say that, on the face of it, registration looks attractive. But what would be the criteria for refusal of registration? I agree that it is desirable to give the consumer every reasonable protection, but I think that there are two provisos that are worth making to that. The first is that the steps are practicable, and the second is that the protection would be effective. As I say, registration looks attractive. The noble Baroness referred to subsection (1) of her new clause, which states:
"No company or society shall carry on business as promoters of a trading stamp scheme unless—
(a) they are registered with the Board of Trade as such promoters …"
I think it would be unusual to give a Department absolute discretion in a matter of this kind. For one thing, the Board of Trade are given no guidance at all as to the criteria for registration; and from the point of view of the public there is a danger that registration would be regarded as an official blessing, or even as a Government guarantee of reliability and solvency.
I quite see that the provision is supported by deposits. But would deposits really give the consumer any worthwhile protection? May I just examine the provision as it stands? It is true that the deposits required are substantial, and that there is a provision that stamp holders' claims shall rank for dividend with those in subsection (3)—immediately after debentures. But I am advised that debentures need not be secured; and if they

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are not secured, the debenture holder is in the same position as any other unsecured creditor. In any case, the noble Baroness says (I think she said she makes the plea), that we should give stamp holders a prior claim over ordinary trade creditors. I find it difficult to justify such a priority. The noble Baroness justified it on the ground that the stamps are related to purchases which the consumer has already made. But, of course, the ordinary trade creditors' debts are normally in respect of sales that have already been made by those trade creditors. That represents, no doubt, a good deal of work and investment on the part of the trade creditors.
But even if we were to give the stamp holders a prior claim, what would be left of the stamp holders' claim in most cases after the expense of making the claim had been met? This is the practical consideration. Requiring the payment of so substantial a deposit (and I see no reference in this particular Amendment to a bond) would be bound to affect the value of the goods and the cash offered in exchange for the stamps. In effect, it is not—
LORD SHACKLETON: Would the noble Lord repeat flat argument? I did not quite follow him.
LORD DRUMALBYN: I was saying that requiring the payment of such a substantial deposit, which seems to me to amount to 14 per cent. of the total cost to the retailer of outstanding stamps, would surely be bound to affect the value of the goods and the cash offered in exchange for the stamps, because it would, in effect, be sterilising 14 per cent. of the total cost to the retailer of outstanding stamps. It may be that the noble Baroness had in mind that a bond would do as well. All I can say is that it does not appear to be in the Amendment.
Perhaps one might illustrate the effect of this as the clause now stands. I am told that one stamp company is issuing stamps at the rate of 200 million a week. If my calculation is correct, on the basis of £2,500 for every 25 million stamps, in effect that seems to me to be a deposit of over half a million pounds, assuming that you have normally six months' stamps outstanding at any given time; and I am told that that is a fairly conservative esti-
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mate. That seems to be tying up the resources to quite a substantial extent.
There are also a number of administrative problems which would be raised by this Amendment. It would involve machinery to check that deposits are made as the number of stamps outstanding increases, and there would have to be a sanction to ensure that that was done. I submit that it would be a very heavy sanction indeed to say that if there were a failure in this respect there should be an immediate cancellation of the registration. What about the return of deposits if the number of outstanding stamps decreases? There seems to be no provision for that.
These, I admit, are matters which could be put right, but it seems to me that there is no logical reason for a fixed deposit in relation to the number of stamps issued and outstanding, for the reason that the price charged for the stamp and the value of the stamp to the consumer may vary quite widely. So there is no good reason for having a fixed relationship between the deposit and number of stamps issued. Therefore, my conclusion would be, with the greatest respect to my noble friend, that the steps proposed are neither fair nor practical.
We think that the power which would be given to the Board of Trade—we are somewhat touched by the noble Lady's confidence in the Board of Trade in this respect—is quite arbitrary, and we also think that in this way the protection to the public would be illusory, or almost illusory, and that it represents a reduction in the value of the stamps to the consumer in the ordinary way of business. Admittedly, things can go wrong, in fact things can go wrong in any business, but we do not think that this is the right way to deal with this problem.
LORD SHACKLETON: I can see that this Bill is not going to have much chance of amendment if the Government are going to throw this amount of weight against a proposal which may not be entirely perfect but sets out to serve a definite purpose. I should like to answer some of the points of the noble Lord, Lord Drumalbyn. First of all, the case for this is the protection which it affords to the consumer. I do not want to start being too Party political, but lately the

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Government have been engaged in various activities, such as the Resale Prices Bill, all of which are designed to protect the consumer. This is a subject which has been extensively considered, and the proposal does not come from an interested party, or from the departmental stores which are opposed to trading stamps—and perhaps I should declare my interest in that sense, but I am in this matter taking very much the same view as the noble Lady.
The noble Lord objected to the theory that the consumer should be given additional protection over trade creditors. But surely the whole purpose of this Bill is to protect the consumer. The consumer is not in the same position as a trade creditor. The consumer, as we know, takes the stamps without knowing their value and—this point has been made abundantly clear—he is therefore entitled to some special protection. The trade creditor who is going to trade with a stamp trading company ought to be in a much better position to look after himself.
The noble Lord used an even more surprising argument. He said that it would be unfair if debentures did not rank ahead of these. I may have misunderstood him. He said that one might have a debenture which was not linked to security. I do not know whether he was referring to a floating debenture or what, but if anybody is going to invest money in a trading company he will take whatever steps he ought to take. I am doubtful whether anybody would provide money on a debenture in the sort of circumstances which the noble Lord, Lord Drumalbyn, visualises. This would be an additional protection to the consumer because those who are lending money will take particular care to see that it is satisfactorily protected.
The noble Lord asked what was the point of registering trading stamp companies. It may be that the Amendment has a defect; it may be that there are certain obligations which ought to be put on the Government in regard to registration. I know that the Government are most averse to taking on any responsibility in this matter, and I can appreciate their reasons for this, although I do not agree with them. But it would be possible, if the Govern-
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ment were sympathetic, to lay down certain criteria in regard to registration. But, even so, the mere act of registration provides some security to the public. It is a formal act and is comparable to that proposed in the rest of the new clause—namely, that there should be a deposit as security whether by bond or in cash.
I could scarcely believe that the noble Lord, Lord Drumalbyn, was using the argument that this would tie up too much of the capital of the company. But whose money is it that is being tied up? This is not the capital of the company. This is a proposal to encourage trading, and the money is paid in advance (I am subject to correction on this) and must surely be held in some secure form, with some security for the people who have bought the stamps. This is also necessary for the protection of the retailer who does not want to see these stamps defaulted on. I hope we shall tackle Amendments of this sort a little more sympathetically. The Consumer Council at least have produced a pretty thorough investigation. I am sure the noble Lady would not suggest that her Amendment, as it stands, is perfect, but I should have thought that the principle of it could have been accepted. I await with some interest to hear what the noble Viscount, Lord Colville of Culross, has to say in reply to the noble Baroness.
5.8 p.m.
THE EARL OF SANDWICH: I understand that the promoters of these trading stamps schemes have some substantial objections to the clause which has been moved by the noble Lady; but I will leave that to my noble friend who is in charge of the Bill. I want to say something on what the Minister of State has said in regard to the attitude of the Board of Trade on this Bill. I can see that, behind the arguments which were adduced today, there may be more substantial reasons than he has cared to disclose for the purposes of the debate as to why the Government are more interested in bonding, which I think justice requires promoters of trading stamp schemes to go in for. In practically every country, and in most of the States of the United States, where these schemes are in operation there is a bonding or deposit system

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which effectually guarantees the stamp-holder that there will be some return in a winding up.
I said on Second Reading, and I say again this afternoon, that it is inconceivable that we should let this situation rest where it is. These stamps are now going to carry a money mark on them, ·075d. or whatever it is going to be. Everybody who takes stamps from now on is going to think that they have some sort of relation to the ordinary postage stamps he buys in the Post Office, in that they are redeemable for cash at their face value and redeemable at the centres where the goods are given.
It is worse than the ordinary private stamp collecting scheme, as I explained on Second Reading, where you can go into a market where there are sellers and buyers of stamps of all sorts and kinds. There is a complete market and you have a safeguard for your collection of stamps. But these stamps bear the imprint of one company and they can be redeemed only by that company, so they have a monopoly in the stamps which are owned by the shopper. Taking that into account, and what I said previously, it seems to me essential that at some stage—it may be too late to do it this summer—the Board of Trade should make itself responsible for a deposit scheme or bonding scheme, which I understand from these stamp trading companies can easily be organised through banks on the lines followed in other countries.
I am sure it is too late to put any provision in the Bill now, because this would be a charge on the Government; they would have to provide some civil servants at the Board of Trade to administer the scheme. It would cost money, and your Lordships' House cannot pass legislation which costs money. There is no Financial Resolution in the Bill to cover this, and, although I understand it is possible technically for the House of Commons to produce a Financial Resolution, even at this late stage, on consideration of Lords' Amendments, it is not ordinarily done and there is some dislike of the process. So I think at this late stage in the summer we should never get it through. But it seems to me that it is for the Consumer Council and other interested parties who want to take real trouble about guaranteeing—so far
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as anybody can be guaranteed in this wicked world—that their stamps, when taken to the stamp trading companies, will be redeemed and that these companies simply will not be allowed to go bankrupt in competition with each other without such provision being made, to promote another short Bill next Session to deal with the whole matter.
LORD SHEPHERD: I am grateful for the speech the noble Earl has made. It seems that we are united, at least so far, in opposition to the Government so far as the Minister's first speech is concerned. I would put one simple question to the Minister. First of all, we accept that he wishes to see legislation passed that will give protection to the consumer; but does he believe that a mere provision in this Bill, that a person who trades in trading stamps shall be a private company, is in itself sufficient protection.
VISCOUNT COLVILLE OF CULROSS: The Bill says that it shall not be a private company.
LORD SHEPHERD: That is true. It has to be a company. It can, in fact, be a private company, but there are not the exemptions. The noble Viscount is correct. But the fact is that you can be a public company and a private company for a very small amount of money; a matter of £25, I understand. Is that in itself sufficient protection for the consumer? We have heard from the Minister of the large number of stamps that are being sold by some companies. No doubt the smaller companies are not selling so many, but their sales are of considerable value, and the noble Lord himself knows that many—in fact, perhaps the majority—of the companies who are now involved in this business have a capital of less than £100. I would not believe that £100 is sufficient for this type of operation, if we are to give the consumer protection. If the Minister will rise now and tell us honestly, in his own words, that this protection in Clause 1 is sufficient to protect the consumer, I am sure we shall be interested to hear it.
THE EARL OF SWINTON: May I ask the Minister of State this question? I appreciate the point of the noble Earl, that there is no Financial Resolution here, but let us suppose that, instead of

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making the Board of Trade register and accept the deposit, the noble Baroness put down an Amendment on Report to say that every company which registers —they have to be registered now, in effect, as a public company—should deposit £2,500 with a bank. That does not involve the Board of Trade in any cost, and it does not require regulation, but it would be a condition which the House could put in. Would that not be a way out?
LORD SHACKLETON: May I just interrupt on one point? It seems to me that the Financial Resolution argument, if it were to be used, is not a serious obstacle at all. If we put this in it would go as a Privilege Amendment to another place, and I think I am right in saying that, in fact, a Financial Resolution has to be moved by the Government. But it would be perfectly easy, and it is not as if this were going to be a major expense. As the Government were inclined to accept this proposal, it would be perfectly easy, at any stage, I should have thought, for them to move the necessary Financial Resolution in another place when the Lords' Amendments go there.
LORD MORRISON OF LAMBETH: Like my noble friend Lord Shackleton, I am not quite sure about this matter under Parliamentary procedure as to finance. The only point I would make is that this money, which the noble Lady is proposing the companies should deposit, is not public expenditure; it is not Government expenditure. Therefore, I am a little doubtful whether or not—
LORD SHACKLETON: It is the cost of registration.
LORD MORRISON OF LAMBETH: That might involve some expenditure by the Board of Trade. But so far as this bigger sum is concerned, I am doubtful whether it would involve a Financial Resolution. However, whether or not that be so, my noble friend Lord Shackleton is quite right—not for the first time—that Privilege Amendments go through here. In fact, one was mentioned this afternoon from the Government Front Bench. I think it was the Chief Whip who specially moved a Privilege Amendment. That is in order
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to call the attention of the Commons to the fact that their privilege is involved, and then the Commons can do as they like about it. Therefore, I do not think it is a ground upon which the noble Lady's Amendment need be resisted. It is more important to deal with it on the merits, and I think there is a lot to be said for the Amendment on the merits of the case.
LORD REDESDALE: I must declare an indirect interest in trading stamps, in that I have a tenuous association with an advertising agency which advertises one of the stamp companies. However, the point I should like to make is that the noble Baroness has talked about bonding in her speech, but in fact her Amendment does not include, as the noble Lord, Lord Drumalbyn, said, any word as to bonding. My feelings are that if a cash deposit on the scale that the noble Baroness has put down were enforced—and although it has been said that this money is paid for in advance, this is not entirely the case—it would put such restraint on the companies, they would have so little flexibility, that they would not be able to give very good value to the consumer in terms of the products they were offering in return for stamps.
Another point which I should like to raise is that no machinery has actually been put into this particular Amendment to govern the fluctuation of the redemption of these stamps; that is, to take account of the stamps that are with traders and, also, the stamps that have gone out but have not been redeemed. There is within this trade a term of "fall out", which means that a certain number of these stamps will go by the board, anyway. People forget about them, and so on. This particular Amendment does not take any account of that. Therefore, it does not allow for the writing off of these stamps. There is, in fact, an allowance for this in the income tax returns that have to be made by the companies at the moment. So this is a point which I am sure the noble Baroness will look at before she takes it any further.
If there were to be a cash deposit related to the total amount of stamps issued, then the sums of money to be put down, as has been pointed out already, would be very considerable indeed, and this Amendment does not

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allow for any interest to be paid on this money. Nor, in fact, does it allow, at a later date, for this money, in terms of the write-off, in terms of the fall-out stamps, to be taken back and put into the company again. I am sorry to have taken up so much of the Committee's time, but I should like the noble Baroness to take these points into consideration.
5.20 p.m.
VISCOUNT COLVILLE OF CULROSS: There has been a good debate on this subject, and it is one that is well worthy of it. May I say, to begin with, that I am grateful to the noble Baroness, Lady Elliot of Harwood, for raising this point. I am also grateful to her for writing to me and explaining in advance the point of her Amendments, as did the noble Lord, Lord Airedale, in regard to his Amendments, so that I would have a full chance of considering them. I must say, to begin with, that whatever may be the principle, and whether that be acceptable or not (and I shall come to that in a moment), I am afraid that I could not accept the Amendment in its present form because it contains a large number of drafting defects. I do not want to stress these particularly, because that would be fruitless; but, apart from anything else, the Amendment now on the Paper is a great deal different from that which was originally recommended by the Consumer Council and mentioned by the noble Baroness herself in her Second Reading speech. On that occasion she put forward a proposal for a deposit equal to 15 per cent. of a promoter's annual receipts from the sale of stamps, subject to a maximum of £100,000, with a special arrangement for new entrants. She would also have provided for a bond or other guarantees to be accepted instead of a deposit of cash or securities. These things, I am sure, would be quite essential if this plan was to work: because simply to insist upon cash is not an adequate way of dealing with it.
The noble Baroness's Amendment also fails in other respects, which have been mentioned by my noble friend Lord Drumalbyn and my noble friend Lord Redesdale. But one of its cardinal mistakes, if I can so term it, is that it is really pointless to attempt to attach the sum of the guarantee to the number of
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stamps issued, because this does not lay down any sort of criterion at all. It may be one thing to have a deposit of £2,500 when 50 million stamps have been issued if those stamps are issued at the rate of one stamp per 6d. of purchase at the shop; but what happens if the stamps are changed, and they are issued at one stamp per £1 of purchase at the shop? The whole of the noble Lady's scheme then goes completely by the board and becomes utterly senseless.
Moreover, there is the question raised in the third subsection of the proposed new clause. I know that it may be possible to get the drafting right, but at the present moment it is, I am afraid, meaningless, because debentures are, as a fact, either secured or unsecured; and simply to say that the redemption of the liability shall rank immediately after debentures does not put it, in law, in any position whatever—whether it comes before or after wages, or whatever it is. Further than that, I do not think that I can accept the principle of preferring the consumers are creditors of a company at a higher rank than the ordinary trade creditors, because I honestly do not see why this should be done. Does the noble Lord wish to intervene?
LORD MORRISON OF LAMBETH: Only to declare that I think that is a rather anti-social argument: that the risk to the consumer has got to be greater than the risk to the investor who has, on the face of it, misbehaved himself.
LORD McCORQUODALE OF NEWTON: I wonder whether the noble Lord, Lord Morrison of Lambeth, would carry that argument a little further. Would he think that the interests of the consumer should come before the interests of the wage-earner, of the worker working for the stamp-collecting company?
LORD MORRISON OF LAMBETH: That is far away from this Bill; and, as the noble Lord knows, that is a thoroughly diversionary tactic and mischievous question on his part.
LORD McCORQUODALE OF NEWTON: I think the noble Lord will realise that that is an answer that answers nothing.
VISCOUNT COLVILLE OF CULROSS: Be that as it may, the new subsection (3) raises a wide principle of where certain creditors are to be ranked on a winding-up or a liquidation. I do not think that this Bill is the place to change this order for this specific purpose only, and I cannot see that there is any argument for doing this simply for the purpose of a trading stamp scheme. Of course, it is not only the investor with whom we are concerned: there are the trade creditors, and many other people who might have money owed to them by these companies. Some of these, or all of these, the argument may go, should be put below the consumer in the order of rank in a winding-up, and I do not believe that the noble Lord, Lord Morrison of Lambeth, would agree with that.
There have been various practical suggestions to get over the difficulty which is inherent in the whole of this clause: that it is entirely dependent upon the supervision of the Board of Trade. My noble friend Lord Swinton, and I think the noble Lord, Lord Morrison of Lambeth, suggested that there would be no real need for a Financial Resolution. I would remind your Lordships that a system of licensing and registration was in this Bill when it was originally introduced in another place. It was taken out by another place, which decided that the Board of Trade should not supervise this matter. I do not for one moment say that your Lordships must agree with another place; but this is a fact, and we are now, of course, getting towards the end of June.
If there is to be a scheme such as is set out in the noble Lady's Amendment, the Board of Trade is not going to be involved to the minor extent suggested by the noble Lord, Lord Morrison of Lambeth. It is not going to issue a licence simply as a formality, as the noble Lord, Lord Shackleton, suggested might be done. If it is to have any function at all, it is going to have to go into the credentials of the company before it issues a licence. At the present moment it may go into the credentials to any degree it likes, and it may, without any reason at all, refuse to give a licence under the Amendment. That is one of its duties. The other thing the Board of Trade has to do under this
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Amendment is to supervise, day by day, the precise number of stamps issued by every trading company, to see whether or not the deposit has been put out correctly. That also will not be a light duty on the Board of Trade, and I foresee that, under the noble Lady's Amendment, there will be officials in the Board of Trade engaged full-time upon supervising this matter.
The reason of principle why I cannot accept this Amendment is that I think this matter has got out of proportion. It is true that one of the main objects of this Bill is consumer protection, but the Bill has other clauses in it than the first one. To start off with, the fog or muddle to which the noble Lord, Lord Shackleton, referred (it is not his muddle, of course; it is in the mind of the consumer) will, I hope, to a very large degree be removed by other clauses in the Bill setting out the cash value, making the catalogue available and making the terms of the scheme clear to the public. Then there is going to be the existing Clause 1, which will provide for the accounts to be visible to the public and to any retailers' association or other body which may choose to look at them. The consumer comes in at the end of this. The consumer will get stamps only if a retailer chooses to go into a scheme.
If a retailer chooses to go into a scheme, he has a great deal of risk. First of all he will have to buy a large number of stamps, which costs him a lot of money, all of which has to be paid at once. Secondly, he will have to persuade his customers that the stamps are a good investment, and that they are an inducement to buy at his shop. Thirdly, if the trading stamp company with whom he is dealing fails for some reason, or goes bankrupt, he is going to have a large number of extremely angry customers on his hands. As I think I said on Second Reading, the harm that will be done to his business if he goes into a bad scheme will be far more than the good which will come to him if the scheme is successful. Therefore the first protection to the consumer is the retailer himself, and he is given "teeth", as it were, by this Bill to check up on the company that he goes in for to see, before he ever introduces these stamps to the public at all,

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that the stamp company is sound. And if he cannot himself understand the accounts in great detail, I have no doubt that there will be plenty of people to advise him about it.
That is the perspective, and it is suggested by my noble friend Lady Elliot of Harwood that on top of all that there should be this most onerous deposit. The effect, as my noble friend Lord Redesdale has said, would certainly be to tie up money which will otherwise go towards improving the quality of the goods which the stamp company offers. I do not say that that is the only point at stake, but it is certainly one. And when a very large amount of money is involved, as it is under this Amendment, it may have an effect on the quality of those goods. In those circumstances I think I must agree with my noble friend Lord Drumalbyn, that, as he said, this is not the right thing to do and it is not warranted by the consideration of all the circumstances surrounding the case. For these reasons, I hope that the noble Lady may be able to withdraw her Amendment, because I believe that we already have adequate protection in this Bill.
BARONESS ELLIOT OF HARWOOD: I have listened with great interest to this discussion, and I am most grateful to noble Lords opposite and on this side of the House who have brought out points in my Amendment, both good and bad. Of course the drafting of an Amendment is a difficult task, and naturally there are flaws in the drafting of this one. I should be the first person to be anxious to put those right. I think my noble friend is rather too optimistic when he suggests that "everything in the garden is lovely" for both consumers and traders. There are safeguards in Clause 1; but I think they might be stronger. I agree with the noble Earl, Lord Sandwich, that this is a matter we shall have to look at again, because I do not think they are strong enough to protect everybody's interests.
It is interesting to note that the noble Lord said that this sum of money I suggested, this £2,500 for 50 million stamps, would be so onerous, because when we consulted—which we did, for I am not opposed to stamp trading and stamp trading companies—with these companies they did not think it was a very large sum of money at all. I agree that in the
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Amendment I did not mention that it could be a bond, but I said so in my Second Reading speech. That is a flaw in the Amendment. I intended this to be either a cash deposit or bond, or to have some financial backing, to reassure and give confidence both to the consumer who pays for the stamps and to the retailer who goes in for stamp-trading. There are, of course, very large companies with an enormous backing and nobody is frightened by them. But already one or two smaller companies have gone bankrupt and we should not like that to happen again. That is one of the reasons why I have suggested this sum which will be additional safeguard for the consumer.
In regard to one or two other points which were raised on this Amendment, I think the Board of Trade, if I may say so, is making rather heavy weather of the suggestion I made that the companies should be licensed by the Board of Trade. It was not my intention that they should supervise every single issue of stamps. That would not be necessary. It is simply that there should be some official backing for the companies and that they should have to satisfy some criterion. I concede that I have not written the criterion into the Amendment, because that no doubt need not be dealt with at this time. I understand that it need not be put into the Bill, but that there can be an arrangement between the Board of Trade and the company. It could be agreed between them and these terms should be in the form of a safeguard.
However, if the Board of Trade does not want anything to do with it, I think we should bear in mind that we do not feel there are sufficient safeguards and guarantees for the consumer. While I am not going to press this Amendment, and I shall in fact seek to withdraw it, I want to go on record as saying that we have consulted the stamp companies and they are not opposed to this bond or deposit and that something of the kind ought to be put into the Bill at some period.
LORD McCORQUODALE OF NEWTON: Before the noble Lady withdraws her Amendment, may I ask a question? She says that the stamp companies are not against this procedure in principle. I should like to know if that is really so. I have been trying to check on it and have not been able to find any stamp

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companies who have given that assurance.
BARONESS ELLIOT OF HARWOOD: When Mr. Jameson compiled his Report he consulted a number of stamp companies. It was because we did not wish to take an anti-stamp or anti-stamp-company line, and because we wanted to get their point of view and represent it fairly, that we discussed the matter with them. I could give the exact page on which this is stated in the Report, but I do not have it at the moment. I could also let the noble Lord know the names of the stamp companies with whom we had consultations. Perhaps I may write to him. However, I can assure him that we consulted with at least three or four companies. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 2:
Statements required on face of trading stamps
2.—(1) No person shall after the commencement of this Act issue any trading stamp, or cause any trading stamp to be issued, or deliver any trading stamp to any person in connection with the sale of any goods or the performance of any services, unless such trading stamp bears on its face in clear and legible characters a value expressed in or by reference to current coin of the realm.

(b) in the case of an industrial or provident society, the name of the society.

5.36 p.m.
VISCOUNT COLVILLE OF CULROSSmoved, in subsection (1), to leave out "commencement of this Act" and insert "coming into force of this section". The noble Viscount said: I hope, with the permission of the Committee, that I might with this Amendment speak to Amendments Nos. 12, 22, 25 and 41, because all the first four pave the way for the fifth Amendment. Noble Lords will remember that the noble Lord, Lord Shepherd, made a suggestion during the Second Reading debate that different parts of this Bill might be brought into force at different times. He suggested that Clause 1—the accounting section—might come into force before the rest of the Bill. I undertook to look into this suggestion and I have found that it is perfectly reasonable to make this Amendment. I therefore put down all these five Amendments to give that effect.
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The effect—and particularly that of Amendment No. 41, which is the Amendment to Clause 9—will be that Clause 1 will come into effect six months after the passing of this Bill, so in that time the accounts and other requirements of the Companies Act will have to be made public; whereas the, as it were, administrative parts of the Bill (Clauses 2 to 5) will still remain inoperative for the 12 months now provided, so that the requisite time for printing and making changes in company procedure can be properly allowed. In case noble Lords want to know what will happen to the rest of the clauses of the Bill, I would add that they will come into force immediately upon the passing of the Act, but they will not have any effect until Clause 1 is brought in by the terms of Amendment No. 41. I hope this will meet with the approval of the Committee, and particularly with that of the noble Lord, Lord Shepherd, and I beg to move.
Amendment moved—
Page 2, line 9, leave out ("commencement of this Act") and insert the said words.— (Viscount Colville of Culross.)
On Question, Amendment agreed to.
BARONESS ELLIOT OF HARWOODmoved, in subsection (1), after the words "trading stamp", where they occur first, to insert "or collecting book". The noble Baroness said: This series of Amendments, Nos. 3 to 9, are all Amendments to Clause 2 and, with the permission of the Committee, I should like to speak to Amendments 3, 4 and 5 together. They are concerned with including the collecting book as well as the actual stamps within the provision for declaring the cash value. Individual stamps have such infinitesimal values by themselves that it is the collection book which will form the normal unit of exchange. The figure on the collection book—say 15 shillings or 25 shillings—is a figure everybody can understand. Amendments Nos. 6, 7 and 8 are to ensure that the cash option value for all the cash values shown on the stamps is on the book.
I should like to give some examples of what I believe to be misleading figures printed on trading stamps.
VISCOUNT COLVILLE OF CULROSS: I do not wish to interrupt the noble Lady, but if it is convenient to her to

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deal with the Amendments in this way, it may be to the convenience of your Lordships; but Amendments 3, 4 and 5 are really raising different principles from those in the other Amendments in the noble Lady's name.
BARONESS ELLIOT OF HARWOOD: I was going to speak to all of them because they all, in fact, refer to the cash value on the stamps, but if the noble Viscount wants me to take only the first three Amendments I propose to do that.
LORD SHACKLETON: May I suggest that it would be better to speak to the first three Amendments, but if it were necessary to refer to the later Amendments, I am sure that the noble Viscount would not object.
BARONESS ELLIOT OF HARWOOD: I should like to illustrate the difficulty of putting on stamps or books figures which can easily be misunderstood. The position in regard to the collecting books and the stamps are closely allied, and both can be misleading.
LORD McCORQUODALE OF NEWTON: May I say that the noble Lady is talking of "collecting book", but Clause 8 refers to "stamp book". Are they the same?
BARONESS ELLIOT OF HARWOOD: Yes, I mean stamp book, the book in which collectors stick the stamps. I will give one or two examples of what I believe to be misleading figures printed on stamps. The figure "6d." does not mean 6d. worth of goods or 6d. in cash: what it means is that the housewife has spent 6d. If she redeems that stamp for a gift, its value would be one-fortieth of a penny, or 3d. for 40 stamps, in terms of a cash option. We do not wish the stamp companies to put a figure on the stamps if they do not represent a true measure of value. I have here a voucher with £1 printed on it. This does not mean that the voucher is worth 20s. but that it represents purchases worth 20s. In terms of trading stamps, it means a value of 3d. What we should like is not to have figures which mislead in any way. Perhaps the Committee would like me to stop here?
VISCOUNT COLVILLE OF CULROSS: We shall get into great confusion, if we deal with all these matters at once.
THE EARL OF SANDWICH: Is the noble Lady moving a Manuscript Amendment now, in the sense of the remarks of the noble Lord, Lord McCorquodale of Newton?
Amendment moved—
Page 2, line 10, after first ("stamp") insert ("or collecting book").—(Baroness Elliot of Harwood.)>
VISCOUNT COLVILLE OF CULROSS: The first point I was going to make was that the term ought to be "stamp book". I would also say something about the question of misleading values, both on stamps and in advertisements. I am in full agreement with the noble Lady, and if she would look at the two Amendments in my name, Nos. 26 and 28, I hope that she will find that they do everything that she desires. We shall come to them later and I will explain them, but I think that between them they cover the case fully. So far as the "6d." or "3d." on the trading stamp is concerned, I think that the Report of her own Council admitted that the requirement ought to be a cash value on the face of the stamp, which means that the trading company would have to redeem it at 6d.; and that they would not wish to do.
Turning to the actual Amendment, I am afraid that in this case the noble Lady is not right, and I hope that my reasons will convince her of this. It is true that at the beginning, when a stamp book is issued to a customer, the total of the face values of the stamps and the total value of the book filled up with stamps will be the same thing. But there are two difficulties. First of all, there are books already issued, which have a value placed upon them, but which are still being filled up with stamps and will continue to be filled up for a long time, because in some cases the stamps are collected quite slowly. When the filling-up extends over such a long period it is impossible for the stamp company, when it issues a book, to guarantee that the value on the book will be the value of the stamps the book contains when it comes to be redeemed, because they may have to change the value of the stamps from time to time. Indeed, they may change the stamps in favour of the customer. But they cannot

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guarantee, and it would not be reasonable to expect them to guarantee, when they issue a book, the value of all the stamps which are later stuck in.
LORD SHACKLETON: I understand that they can alter the value of the books, but does not the same argument apply in regard to the stamps? Must the value of the stamps, once issued, always remain the same?
VISCOUNT COLVILLE OF CULROSS: Once the stamp is issued, its face value will remain the same until it is redeemed. But different sorts of stamps may be issued during the lifetime of a book, and this may falsify the value of the book when issued. The only way out of this is to put some term on the period in which the stamp book may be redeemed. A trading stamp company might reasonably be allowed to say that if a stamp book is returned within a year, or two years, then the customer will get the value they have placed upon it. The difficulty then is that it runs straight into the terms of Clause 3(5), which prevents any modification of cash redemption, and clearly this would be such a modification.
It is cardinal to the whole idea of cash redemption that there should be a statutory bar to modification. The only way out for the stamp company, which would allow them to do what the noble Lady desires, is completely blocked by that vital provision. It is true that the face value of stamps may be small, but is it really beyond the capacity of a member of the public to multiply 1,260 by ·075 of a penny? It may be difficult for me, but I am sure that most members of the public can find somebody to do it. After all, that is the only sum they will have to do. And that is the only object of this Amendment. It will do it for them, but possibly in a way that does not give the right answer in the end. I hope that the noble Lady will see that this Amendment is perhaps misconceived and cannot be put in the Bill.
LORD SHACKLETON: I was nearly convinced by the noble Viscount's argument, until he called in aid Clause 3(5). There is no Amendment down to that, and I do not think that there is any need to amend it so that it applies to books. I may be wrong here, but if this protection is confined to stamps
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I do not see that this is an absolute bar to the proposition that the value on the book should be the value at the time the book was issued. The noble Viscount shakes his head and I do not want to prolong this argument, if I am on the wrong tack.
VISCOUNT COLVILLE OF CULROSS: The difficulty is that the Amendment in the name of the noble Lady requires the company, as a statutory matter, to redeem the stamp book at the value upon it. It would be quite impossible to remove the bar upon modification or surrender in this case and leave it simply on the stamps. If we cannot remove it on the stamps, we cannot reasonably remove it on the books either.
LORD AIREDALE: There is another difficulty for me which the noble Viscount mentioned in the course of his speech. He pointed out that the value of trading stamps may be changed from time to time; and that I quite follow. My difficulty is this. The gift catalogue states the number of stamps which are required to acquire a particular gift.
VISCOUNT COLVILLE OF CULROSS: Books.
LORD AIREDALE: Well, books. It is the number of stamps, as well. Does that mean that different stamps having different cash values will nevertheless rank as having the same value for the purpose of redeeming goods?
VISCOUNT COLVILLE OF CULROSS: It may well be so, because there is not any necessary tie between the retail value, as it were, of the goods redeemed, if you take goods, and the cash redemption value, which is the only thing shown on the face of the stamp. What the noble Lord suggests may well happen.
LORD SHACKLETON: I honestly do not see the objection. If you can put it in a catalogue, I do not see why you cannot put it on a book.
VISCOUNT COLVILLE OF CULROSS: You do not put it in a catalogue.
LORD SHACKLETON: I accept that. But I still do not see why you should not put it on the book. It may not remain in date, but could it not be valid as at the time the book was issued? I do not see, under the Amendment moved by

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the noble Baroness, Lady Elliot of Harwood, that it would lead to the obligatory application of Clause 3(5) so far as the book is concerned. However, if the noble Baroness takes the same view as the noble Viscount, Lord Colville of Culross, I will not press the point.
VISCOUNT COLVILLE OF CULROSS: It may be that I am wrong in this, but if I am it will be essential that the same thing shall apply, because otherwise you would fall between two stools. The noble Lord suggests that the redemption value in the stamp book should be valid when the book is issued. But the book cannot be issued full of stamps. The object is to collect stamps as you go along. There is no value in the book when it is issued, because it has no stamps in it.
THE EARL OF SANDWICH: I do not know whether my noble friend Lord Colville of Culross has studied the catalogues. They all seem to me to contain merchandise which can be redeemed only upon presentation of a book or books or sections of books. There is, for example, a set of tableware which can be redeemed at 5 books. If that is so, I should have thought that the book could carry its designation in money as the stamp is going to, because it will make it difficult for a stamp trading company to do what my noble friend says—that is, to issue stamps of a different denomination during the period when the book is being filled up. The customer, seeing the money value on the stamp, and receiving a stamp of a different description when the book is half full, will proceed to put it in the second half of the book and then take it into the shop and say: "This is worth more than it was when the book was issued to me, because the stamps total more than the value on the book."
I therefore think it will be obligatory on stamp trading companies to do what they are in fact doing now, and that is, change these catalogues only at certain definite periods of time and accept the books that are presented up to that time. They change the designation according to the rules laid down, as I understand it, and issue a new catalogue valid for another period of time. Perhaps all companies do not operate in the same way, but I have knowledge of one company, and that is what they do. In that case,
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I should have thought, for the reasons I have given, it was safe to do what the noble Lady wants and put on the stamp book the value of the stamp book when filled up with stamps.
VISCOUNT COLVILLE OF CULROSS: It is not easy, and I must try to explain it again so that your Lordships will be clear upon this. There are two matters which have to be considered. First of all, there are the goods which you may redeem by presenting a certain number of books. Those are the things that are dealt with in the catalogue. It is to the number of books that have to be presented to redeem those that the catalogue refers. That is one consideration: the goods value of these stamps and the goods value of a full book. There is another totally different value being introduced by this Bill, and that is the cash redemption value. This has not necessarily any relationship to the goods redemption value if you choose to go for one of the things in the catalogue. There is no necessity to keep it pegged to the rise or fall in the value of the goods. It may be that competition in the market forces a stamp company to give a higher cash value on its stamp, while keeping the same goods value. There would, therefore, be nothing to make them alter the catalogue merely because they wish to alter the cash face value of the stamp. Therefore, the objection that these stamps may have a different cash face value on them has nothing to do with this argument. There may be a different catalogue issued from time to time. It is a separate issue, and one which must be decided on its own.
LORD SHACKLETON: I think the noble Viscount has made it abundantly clear, and I see no objection to the Committee's accepting this Amendment. The noble Earl, Lord Sandwich, and I may have been a little slow at taking the point, but I think we have taken it now. What I think the noble Baroness, Lady Elliot of Harwood, and we are suggesting is that the collecting book or stamp book (no doubt at a later stage of the Bill the words "collecting book" can be altered to "stamp book" to bring it into line) should bear the cash value of the stamps that will go into the book at the time it is issued. I cannot see the difficulty.
LORD DRUMALBYN: I would only observe that, while I see no great vice in this Amendment, I see no great virtue in it either. The sole virtue of the Amendment would be if at all times the value on the book was the value which could be obtained by the holder of the book when she came to cash it. But as it appears that that is not so, because the values of the stamps may change in the meantime and there may be stamps of different value in the book, it seems to me, on the whole, that the arguments against putting in this Amendment outweigh those for putting it in.
BARONESS ELLIOT OF HARWOOD: This matter has been discussed at great length, and I am not going to press the Amendment. I cannot say I am convinced by my noble friend Lord Colville of Culross, and I should like him to look at it again. This is done by Ministers when we are discussing Bills in Committee stage. He suggests that it would be easy to multiply by ·075 of a penny, but this is not so easy, and certainly not for the kind of person who collects these stamps. I am not impressed, either, by the fact that there is a transition period. There will be a transition period in the whole of the Bill. There are hundreds of catalogues out now, and millions of stamps are being issued all the time. When this Bill comes into effect there will have to be a transition period, as the noble Viscount has indicated. I think in order to help the consumer not to have to do this complicated sum, to put it no higher than that, this matter should be looked at again. However, I do not propose to press the Amendment, and I ask leave to withdraw it.
Amendment, by leave, withdrawn.
BARONESS ELLIOT OF HARWOODhad given notice to move in subsection (1), after "a" to insert "cash". The noble Baroness said: I have spoken to this and the next Amendment. Do I understand from the noble Viscount that his Amendments, Nos. 26 and 28, will cover this question of misrepresentation on stamps?
VISCOUNT COLVILLE OF CULROSS: My two Amendments will cover Amendment No. 8. They will not deal with Amendments Nos. 6, 7 or 9.
BARONESS ELLIOT OF HARWOOD: They will not ensure that the cash
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option value is going to be shown on the stamp book?
VISCOUNT COLVILLE OF CULROSS: That is the Amendment the noble Lady has just withdrawn.
BARONESS ELLIOT OF HARWOOD: I will not move Amendments Nos. 6 and 7. May I ask whether it is the fact that the Amendment of the noble Viscount will cover all I have said about misleading figures and misleading statements such as this? Would the noble Viscount assure me of that? I beg to move Amendment No. 8.
Amendment moved—
Page 2, line 15, at end insert—
("() No money value other than the cash value aforesaid shall be shown on any trading stamp or collecting book.").—(Baroness Elliot of Harwood.)
VISCOUNT COLVILLE OF CULROSS: Yes, my Lords. I think the noble Lady —I hope she will, at any rate—will be satisfied when she looks at my Amendments. There are really two problems, as I understand it. One is the false value upon the stamp representing the amount of money you have to spend in order to get it, rather than the redemption value of the stamp itself. This is inherently cut out by the terms of the Bill itself, because if the stamp company continues to do that after the transitional provisions in my Amendment No. 26 have expired it will have to redeem at the full face-value. But, of course, this would be the end of that type of trading stamp. The other point the noble Lady is concerned with is the voucher with £1 on it which appears on the front of Mr. Jameson's book. That will be dealt with by the new clause which appears as Amendment No. 28. That voucher is an advertisement, and such an advertisement is expressly forbidden by the terms of the clause. I therefore hope the noble Lady will be satisfied and will think that this particular Amendment is not necessary.
BARONESS ELLIOT OF HARWOOD: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
BARONESS ELLIOT OF HARWOODmoved, after subsection (1), to insert:
"(1A) The cash value referred to in the foregoing subsection shall be that for which the stamp or completed book may be redeemed

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for cash pursuant to the next following section, and shall be expressed in the form 'x stamps can be cashed for ad.' or, as the case may be, 'This book, when completed, can be cashed for £b or c/-', such numbers being inserted in place of the symbols 'x', 'a' 'b' and 'c' as to give a relation of 3d. or more to £1 between the cash value and the sum spent upon the goods or services in connection with which the stamps were delivered."
The noble Baroness said: I think this Amendment is one of considerable importance. To arrive at a formula for varying stamps is a difficult thing to do, and we have a suggestion in the Jameson Report on page 14. The formula which I have put in (it appears to be a somewhat algebraic formula) may meet the difficulty of finding a method of valuation. The stamp companies would obviously wish to value their stamps on a flexible formula to allow the companies to develop their own schemes, so long as the ratio of 3d. or more to 20s. is maintained. I want the cash value of the stamps to be shown in relation to not less than 3d. to 203. worth of purchases. This works out in practice at approximately 1¼ per cent. of the money spent in order to obtain goods. We set this figure at the approximate wholesale price of the goods supplied to the stamp company, and it is arrived at by this formula. If the stamp companies wish to increase this ratio for reasons of competition with other stamp companies—and that might well happen—they could do so under my Amendment, and in this case it would be better, of course, for the consumer.
The point I wish to stress is that the cash option must not fall below 3d. in 20s. I notice that two noble Lords have put down Amendments to my Amendment, one proposing 4d. and the other 6d. The reason why we came to the view that 3d. was fair both to the stamp companies and to the buyer who wishes to exercise his right for the cash option was that it equates most closely with the wholesale cost of the goods to the company. If we take the wholesale price, we are being, we feel, fair to the stamp companies. We do not want to state the cash option so high as to make the profitable operation of the stamp companies impossible.
As I said in my Second Reading speech, I am not opposed to stamp trading as a means of selling goods. It is simply a variant of many other methods used by companies, and I am
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anxious that there should be a proper arrangement in order to be fair to both sides—to the stamp companies and to the consuming public. Therefore, I think the suggestion I have made of 3d. below which the cash option cannot fall is as fair as possible. Unless the Bill includes a cash option I do not think it can really protect the consumer effectively. In order to protect the consumer from the whims of the stamp companies to say what they believe the cash value of their stamps to be, there must be a method by which the value can be ascertained. There must be a lower limit below which the value of the stamps cannot fall. Unless this is put into the Bill, the idea of a cash option may become mere fiction. I would therefore beg the Committee to support this Amendment, without which the purpose of the Bill is greatly weakened. I beg to move.
Amendment moved—
Page 2, line 15, at end insert the said subsection.—(Baroness Elliot of Harwood.)
LORD SHACKLETONmoved, as an Amendment to the Amendment, in line 8, to leave out "3d." and insert "4d.". The noble Lord said: I rise to move the Amendment to the noble Lady's Amendment. I think it would probably be for the convenience of the Committee, and also correct, to discuss the whole question of my Amendment. I would, therefore, like to make a few remarks in general support of what the noble Baroness has said. Let me say straight away that I greatly appreciate the difficulties that the sponsors of a Private Member's Bill have, and although we may appear to be harassing the noble Viscount, I am sure he is generally in sympathy with our aims. At any rate, he is well able to look after himself, as he has shown already.
It seems to me abundantly clear that there ought to be a minimum of some kind below which a cash value in relation to the total expenditure should not fall. There is a good deal of evidence of how this has operated in other countries, and noble Lords have no doubt read the particular section of the Consumer Council's study which deals with this matter, in particular page 8. In the United States, the usual cash option—and I hope I am interpreting this correctly—is some 35 to

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40 per cent. of the merchandise value. Here we get into some difficulties, in that this particular figure, whether it be 3d. or 4d., is not directly related to the merchandise; it is merely a rough assumption of what might be thought to be the wholesale price.
The argument in favour of having some sort of minimum figure is that the experience in the United States has been that there is little competition between stamp companies in the matter of the cash option. There may have been competition in other respects, in relation to the goods that may be provided in other ways, but not in relation to the cash option, because, by definition, people who want cash are not really interested in the stamp schemes at all, but merely find it more convenient to take the cash. Therefore, they would not particularly wish to seek out a company or a supplier which gave a bigger cash option. However, this is a point of view on which we could obviously argue at some length, but experience suggests there has been little competition.
VISCOUNT COLVILLE OF CULROSS: Before my noble friend sits down, I would say that I am interested in this argument and ask him what authority he quotes for saying that there has been no competition—because I have been trying with great care to look this up and have so far been unable to find out.
LORD AIREDALE: May I refer the noble and learned Viscount to the last footnote on page 8 of the Consumer Council's latest Report, which discusses California? It says, in the last but one sentence:
"Competition between stamp companies in respect of a cash option is weak, if not nonexistent".
LORD SHACKLETON: However that may be—and it may be that the noble Viscount can, in fact, controvert this argument—it would be necessary to prove beyond doubt that competition would work in this field. Even if it were possible to prove that competition would work, that would still provide no objection to a minimum cash value, because if competition then worked effectively and brought it above that figure, so much the better. What we are afraid of is that it will not work,
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and therefore it is necessary to have a minimum value.
The difficulty, of course, and this has been a major difficulty, in drafting this Bill has been arriving at the right figure and the right formula. In view of the difficulties in Private Members' legislation I think the noble Lady has been quite right to go for a simple cash figure. We are in some difficulty on this point because the Amendment which she is now moving can hardly be a satisfactory one in view of the failure to carry the earlier Amendments with regard to collecting books. None the less, I am sure the Committee will not regard this as a reason why, at this stage, we should not thresh this out. It would, of course, be perfectly possible to amend it; indeed, I think it would be possible to amend it quite easily by a manuscript Amendment to make it relevant; but, if not, it can be done at a later stage. I would, therefore, strongly support the noble Lady in fixing a minimum value. In fact, the formula which she has used is not difficult to follow and will be very much easier if we are no longer concerned with collecting books.
My complaint about this Amendment is that 3d. is really not enough. And this is a subject on which I do, in fact, speak with a little direct knowledge. Other noble Lords would confirm—I am sure that if the noble Lord, Lord Mabane, were here he would—that a figure of 50 per cent. for gross profit is quite excessive in relation to any form of regular retail trade, with the possible exception (and this is a matter on which there may be difficulty) of certain types of trade such as petrol selling. But in regard to sales in shops, 50 per cent. is far in excess of anything that is really necessary. If, in fact, the cash option is not going to be any more than 50 per cent., and is going to be even less, I can only say that there will be gross profiteering on the part of the stamp-trading companies.
The average gross profit in relatior to the sale price of the goods, not the on-cost or mark-up—and even here we run into further slight difficulties because it is customary in the retail trade frequently to deduct wastage on this point; but this is quite reasonably ignored—is about 20 per cent. to 30 per cent. In the food trade, of course, it is very much lower. Therefore, to give a 100 per cent. gross profit

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seems to me to be excessive. If we were to take the highest appropriate figure—and I would say that 33⅓ per cent. is absolutely the highest figure—then 4d. would be the answer.
I should like to know from the noble Lord, quite apart from the merits of the noble Baroness's case, whether there should be a cash option at all; and I should like to know, if we were to have such a figure, what would be thought by the noble Lord to be appropriate; because if the Consumer Council are finding it necessary to give them a gross profit of the kind that is suggested by their figure of 3d., I would repeat that they are in this case profiteering. The position must surely in this respect—and I think this is also apparent in the Report of the Consumer Council—be at least as strong as for the average department store, bearing in mind that ultimately the service provided may be considerably less. But even if we relate it to the mail order business, I should have thought that this particular figure of 3d. was inadequate. I beg to move.
Amendment to the Amendment moved—
Line 8, leave out ("3d.") and insert ("4d."). —(Lord Shackleton.)
6.16 p.m.
LORD AIREDALE: If I may join in this debate on the Amendment, I think it will then enable me formally to move the next Amendment, which stands in my name, which is an Amendment to this one. The Amendment of the noble Lord, Lord Shackleton, has sought to substitute the figure of 4d. for 3d. in the noble Lady's Amendment, and my next Amendment seeks to substitute the figure of 6d., thus, in my view, equating redemption for cash with redemption for goods and giving both kinds of redemption the same value so far as can practically be done.
I should like to discuss this matter, putting the viewpoint of the busy housewife, bringing up a family, probably doing part-time work and very likely spending part of her spare time in running the Women's Institute or doing valuable voluntary work of that sort. This lady has been a faithful customer of a certain grocer for perhaps fifteen years, and one day she finds that the grocer has started running a stamp-trading scheme. This is quite contrary to the lady's ideas. She has no interest whatsoever in taking part
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in any stamp-trading scheme and says that she is far too busy with all that she has to do to collect stamps and go through all this rigmarole.
Having read of the speech of the noble and learned Viscount, Lord Colville of Culross, on the Second Reading of this Trading Stamps Bill in this House, she says to her grocer, "I simply have not got the time to stick 1,250 stamps into a book in order that I may thereby acquire a cut-glass marmalade jar with a silver-plated top reputed to be worth about 15s. 9d. My spare time simply does not allow me to do that. I should like you, the grocer, to pay me 2½ per cent. discount on the spot, but I do not suppose you are willing to do that. If you are not willing to do that, since I am not prepared to throw away such benefit as may accrue to me from your trading stamp scheme, which I do not like, I am prepared to go with the scheme to the extent of saving the stamps until they are worth 5s., and to redeem for 5s. every time I have 5s. worth. But I take the strongest exception to being given a worse bargain than my fellow shoppers here, who may have time on their hands and time to stick 1,260 stamps into books and then to redeem the books for goods. Why should those people get better value for their custom than I, your faithful customer, who have dealt with you for fifteen years?" That why, in my submission, the only fair thing to do is to equate cash value with the value for goods, so that this lady I have mentioned shall get what I think all your Lordships would say is only a fair deal.
It may be that if stamp trading companies are going to have to redeem at that figure they are not going to make a profit on the transaction; I daresay that is true. So what? Does society owe stamp trading promoters a living? I suggest society simply does not. In any event it is not quite so bad as that for the stamp-trading promoter: he has already had the use of the money from the grocer in return for all these stamps the lady has been collecting all this time in order to acquire 5s. worth, and I should have thought that proper redemption, the same for cash as for goods, was the fair thing in the case of a customer of this kind.

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It has been said—the noble Baroness, Lady Elliot of Harwood, suggested it earlier—that cash redemption at this sort of figure might kill stamp trading. Others also have said this. But I do not believe it. We have been told that one of the great attractions and advantages of stamp schemes is that the stamp companies, by buying in huge bulk, can buy so-called gifts at such advantageous terms from the manufacturer that they can afford to give them as so-called gifts to their customers at values which represent better value than the customer will get she goes shopping for that particular so-called gift. I daresay that is true. If a stamp trading company put in an order for half a million fish slicers, it may be that they get them on terms which will enable them to give them as gifts, in return for stamps, more cheaply than people could buy them directly. A customer in the shop interested in acquiring a fish slice is not going to redeem stamps for cash and then go and pay more in the shop next door for a fish slice just like the one she could have got in redemption for the stamps.
Then we are told that some ladies find great fascination in stamp collecting. They do not look upon it as an economic proposition, any more than when they have 6d. each way every afternoon on a horse. They find it fun; and these people are still going to find it fun and are going to collect for gifts, whether or not they could have got cash equal in value to the gifts had they chosen not to bother about stamps.
Finally, there is a very important class of housewife who reasons in this way. She says, "My husband pays the grocery bills. I could redeem the stamps for cash, but if I did so I should be morally bound to hand the cash over to my husband who has been paying the bills. On the other hand, if I redeem for gifts I can get something for myself, or for one of the children, and my husband will be quite pleased with that arrangement. So I prefer the gift rather than cash." This housewife will still collect stamps, notwithstanding that she could have cash equal to the value of the gift. I do not believe that it is true to say if cash redemp-
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tion is of equal value to redemption in goods it will kill stamp trading. I think it is simply untrue.
What about the housewife who is faced with a sudden emergency: someone who has been collecting stamps and has a great many of them—perhaps towards a bicycle for her son? She suddenly needs cash in an emergency, in order to make a long journey to the bedside of a relative, or something of that kind. She says, "I have all these stamps and I can go and get the cash". Why should she be offered a derisory sum in cash, a sum in no way related to the value of the bicycle she could otherwise have had? Why should a stamp trading promoter enrich himself at the expense of the housewife in that position, by offering her bad value for cash redemption? Parliament having decided in principle that there is to be compulsory cash redemption, I believe it is Parliament's solemn duty to see to it that the cash value of these stamps is proper value. I was very sorry to hear the words of the Minister (I am sorry to say this) on Second Reading when he said [OFFICIAL REPORT, Vol 258 (No. 79). col. 761]:
"It is difficult to see why competition between stamp companies should not keep up the cash value without any need for a prescribed minimum".
With great respect to the Minister, it is easy to say that. When a trading stamp scheme begins, people are not thinking about cash values when the scheme comes to an end: they are thinking—most of them, at any rate—about the gifts, and they are not going to be put off because of the amount of the cash value of the stamps.
In the Second Reading debate I advocated a compulsory spot cash discount of 2½ per cent. as an obligatory alternative to trading stamps for any shopper who demanded it in a store where trading stamps are operating. I have held this Amendment in abeyance, because it seemed to be preferable to try to sort this matter out in relation to cash values to be placed upon stamps in this Bill. But if we do not succeed this afternoon in guaranteeing a sensible cash value on trading stamps, at the next stage of the Bill I shall move an Amendment, as I say, to make obligatory, at the request of the customer, a 2½ per cent. spot cash discount in the shop.
LORD McCORQUODALE OF NEWTON: I mentioned on Second Reading that I understood there had been a public opinion poll on stamp collecting, and that it turned out that no fewer than 25 per cent. of consumers between the ages of 18 and 65 collected stamps; and of those who did not themselves collect stamps, no less than 90 per cent. said that they had no objection, and indeed approved of other people collecting stamps if they wanted to. It is obvious from the noble Lord's speech that he is one of the 7 or 8 per cent. who object to other people collecting stamps, because his stipulation that the minimum figure should be 6d. would totally destroy the possibility of running sensibly and economically any form of stamp collecting. I think it would be much more honest if he came out and said that he did not like stamps and wanted to kill them, rather than bringing forward these wrecking Amendments.
THE DEPUTY CHAIRMAN OF COMMITTEES: The noble Lord, Lord Airedale, has not yet moved Amendment No. 11.
LORD McCORQUODALE OF NEWTON: I apologise. He discussed it, but has not moved it.
LORD AIREDALE: Since the noble Lord has just said something about my honesty, I think he might look at my speech on Second Reading. I have the Report of the Second Reading in my hand, although it is open at the speech of the noble Lord, Lord Drumalbyn. But if my honesty is being questioned at all, may I quote what I said on Second Reading?—it appears in the OFFICIAL REPORT Vol. 258 (No. 79), at column 730:
"I should be quite pleased to see the total abolition of stamp trading, but I realise that in this wicked world, in which we may to our heart's content bet"—
and so on. think I quite honestly and properly put my view on Second Reading; and there it is.
LORD McCORQUODALE OF NEWTON: I quite agree that it is there. I would admit freely that the noble Lord put his point on Second Reading. If he had been listening to my remarks, I said exactly the same as I said to-day, that
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he is obviously wishing to kill the Bill—and, of course, his Amendment here would wreck trading stamps altogether.
LORD AIREDALE: No.
LORD REDESDALE: I should like to draw your Lordships' attention to one or two other points which have not so far been mentioned in this debate. Talking more from the retailer's point of view than from that of either the consumer or the stamp trader, if a straight flat cash value is placed on this, meaning that all stamps work out to the rather complicated formula contained in Amendment No. 9 (I do not think it is simple) and in fact that formula is applied all the way through, some retailers in certain classes of goods would be in a much more difficult position than others. I would draw attention to a case of spirits where there is a high duty to be levied. Here, the retailer has to place the number of stamps that he is offering on the total cost of the item where duty is so high that obviously it is making the scheme much more costly for that particular retailer. I think your Lordships will agree that that is rather unfair on him.
In certain other classes of business where margins are small, the retailer puts on stamps to try to gain a share of the market. After all, his whole object is to gain business. That is why he is doing it. He either does it or he lowers his price. If the margin is tight and he chooses to put in stamps, then he would be in a much more difficult position if this Amendment passed than those in other trades where the margins are much wider. Consequently, although I am in favour of a value being shown, so that at least the consumer knows where she is, I feel that there are problems in certain trades where the total value of the goods in return for the profit on the goods makes this scheme rather difficult to operate.
6.33 p.m.
VISCOUNT COLVILLE OF CULROSS: This, I think, is really the other true point of substance that will have to be debated on this Bill. The first Amendment moved by my noble friend Lady Elliot of Harwood is probably the other one. I am bound to admit that I regard this as a most difficult matter. When I started to consider this Bill I was,

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quite frankly, attracted to some sort of scheme for pegging the cash redemption value to something. When one goes into this question I think there are four questions to be taken into account. First of all, is any scheme put up workable and profitable? Secondly, is it enforceable; and, if so, by whom? Thirdly, is it fair? And, fourthly, will it "bust" the trading-stamp company? I am bound to say that although I have looked at a fairly large number of schemes—and the noble Lady's is one —I have not yet found one which will fulfil all the criteria that I have set out. The noble Lady's scheme does not.
There is first, of course, one somewhat ridiculous point, that I think it would be fairly difficult to write on the face of the stamp all that the noble Lady wants, as well as the value of the stamp and the name of the issuing company. But perhaps that difficulty could be got over, although the details shown must be clear and legible, as the noble Lady observes. But the main point is, that there is a compulsory requirement in this Amendment for a 1¼ per cent. discount on all goods given with stamps. May I say at this stage that this is totally different from what the noble Lady suggested on Second Reading and from what was put forward as such a simple and easy-to-operate scheme by Mr. Jameson, is his book produced by the Consumer Council. I do not criticise the noble Lady for changing her mind. I think it is indicative of how extremely difficult this question is. Nevertheless, it is a totally different matter.
What is now being propounded has, to my mind, this fatal flaw. It is suggested that a 1¼ or 2½ per cent. discount should be given. This is something which it is not in the power of the promoter of the stamp scheme to ensure. He cannot say how much the customer must spend in the shop before getting a stamp. He can stop the person who has taken his stamps, the retailer, changing the scheme around in a fairly flexible way if he wants to. Then there is a penal provision which I have no doubt the noble Lady would wish to apply to the pegging of the cash redemption value. Yet the person who is penalised has no power whatever to ensure that the particular matter upon which he is going
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to be fined is carried out. This seems to be grossly unfair; and it means that the clause is unworkable.
There is the other point that the noble Lord, Lord Redesdale, has mentioned. I do not see any necessary reason why a retailer should give a 1¼ per cent. discount on his goods. This may be suitable in some businesses, but it may be quite unsuitable in others. If trading-stamp schemes are to be allowed to continue at all (I know that the noble Lord, Lord Airedale, would rather they did not), then surely they must be allowed to perform the function for which they were intended, which is to act as a flexible form of discount and not as a tied one, pegged down in the way that is suggested.
BARONESS ELLIOT OF HARWOOD: If I may interrupt my noble friend, he keeps talking about not being flexible. But the whole object of my Amendment is to ensure that it is flexible. We have not put in any figure: we have said only that the ratio should be "3d. or more to the £1". We have not put in actual figures, because (here I would agree with my noble friend) it is not possible to do so, owing to the flexible nature of the goods. But the ratio I am keen about, 3d. to £1—other noble Lords have suggested other figures—would in my opinion be entirely fair to the stamp companies. In fact the noble Lord, Lord Shackleton, says that it is too generous. In the Report from which I have taken all this, the Jameson Report, we have tried to err on the generous side because we know that there are some (Lord Airedale is one) who are against stamp trading. We want stamp trading to continue, for, as the noble Lord, Lord McCorquodale of Newton, said, numbers of people like it. My noble friend says that my proposal is inflexible; I say that it is flexible.
VISCOUNT COLVILLE OF CULROSS: Yes, but it is out of the control of the promoter of the stamp trading scheme. If she were batting on the same wicket as she was on Second Reading my noble friend would be perfectly right. She then laid down a minimum that was within the control of the promoter of the stamp scheme, because it was a connection between the cash value that he put on the stamp and the wholesale value at which he bought the goods. It is perfectly all right if you can work the

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rest of it—though I do not think you can—to provide something of that nature. But how can you tie down the retailer, not the promoter of the scheme, in regard to the way in which he uses trading stamps? That is what the noble Lady is trying to do. It is the retailer who is caught by it, and it is the promoter who is fined for what the retailer does.
LORD AIREDALE: May I interrupt? I suggest that it would not be difficult at the next stage of this Bill to secure that no retailer giving stamps shall give stamps worth less than 3d. for every £1 spent in the shop.
VISCOUNT COLVILLE OF CULROSS: That is an entirely unjustifiable interference. Why should the retailer be forced into some scheme of that nature if he does not want it?
LORD AIREDALE: In order that the Consumer Council's considered ideas on this matter shall be made practically workable.
VISCOUNT COLVILLE OF CULROSS: Of course, I have the greatest respect for the Consumer Council, but these are not the Consumer Council's ideas, because they are totally different from them. I know that the noble Lady is seeking a difficult goal, but the Consumer Council's ideas are totally different from this Amendment. Therefore, it is difficult to see that this argument can bind them. I am not casting aspersions on the noble Lady, for I know that she is trying to do something difficult.
BARONESS ELLIOT OF HARWOOD: I am sorry, but I take exception to this. If one looks at page 14 of the Report one will see that this suggestion is put out:
"There is no need to know the value of each gift; indeed, the basic figures are already available since a stamp company could not make out its tax forms without stating what it pays to manufacturers. To discover the average wholesale price per book one divides the sum paid out to the manufacturers by the number of books received for redemption in any given year."
That was very difficult to put in an Amendment. I put it in this Amendment, which has exactly the same result.
VISCOUNT COLVILLE OF CULROSS: It might do, or it might not.
BARONESS ELLIOT OF HARWOOD: I am sorry, but it does.
VISCOUNT COLVILLE OF CULROSS: This Bill is to be an Act of Parliament and we are here providing a penal clause. There is a provision here by which a promoter of a stamp company may be fined. I accept that it may be true that this will have the same practical effect as the suggestion put forward in the Consumer Council's study, but it may not. And if it does not, it will not necessarily be the fault of the promoter of the stamp companies, and yet he will be fined for it. I find this objectionable, and it is something I cannot accept because I believe that it is not fair. This is the same sort of problem I have come up against in every other variety of this pegging plan. Of course this is difficult, and I am nothing like as despondent as the noble Lord, Lord Shackleton, about what the effects of competition will be.
I was grateful to the noble Lord, Lord Airedale, for referring me to the footnote on page 8 of the Consumer Council's book. I do not know whether competition referred to in that footnote is meant to be nationwide competition in America or simply confined to California and the State of Washington. The grammar does not help. There is something very odd about the State of Washington in this respect and it is not comparable with this country. There is something equally unusual about the Blue Chip Company in California because it is an unusual variety of company and is not a precedent for the argument with which we are dealing this afternoon.
Mr. Jameson says that the redemption value is 30 to 40 per cent. of the value of merchandise; that is one piece of information. There is another piece of information in a book by somebody called Mr. Harvey L. Vredenburg, who comes from the University of Indiana. I think his footnote makes clear that his was a very objective study. He says that when the stamp companies combine a cash redemption plan with a goods redemption plan, which is the set-up this Bill will provide, the value in cash and in merchandise is stipulated on the stamp book and the consumer usually receives from 10 to 20 per cent. less value in cash. This may support Lord Shackleton when he talks about 33⅓ per cent., but it does not support him when he says the likelihood is that the competition will not exist to keep the price up.

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I believe it will, and for this reason. Imagine a trading stamp company trying to persuade retailers to take their stamps and to issue them to their customers. What is going to be more obviously a talking point when this Bill comes into effect than the cash value written on the front of the stamp? To produce one with a smaller cash value than that of their rival is the most obvious disadvantage they will have to fight against. This is something the customers will be able to see clearly at once, however bad their mathematics or algebra may be. This is something which I am sure is going to be extremely important in selling these stamps to the retailers. Therefore I believe that competition will provide the answer, and I am afraid that I feel the noble Lady is going to interfere in the flexibility of stamp schemes as used by the retailers, not as put forward by the promoters of the stamp schemes, in a way that is quite unwarranted, and that she is also going to make the stamp company liable to be fined for something over which it has no control at all. Therefore, with great regret, I fear that I cannot accept this Amendment, and a fortiori I ought to say I am afraid I cannot accept the noble Lord's either.
LORD SHACKLETON: It might be helpful if the noble Viscount would deal with my Amendment. There is a certain acrimony coming into this debate which was shown in the remarks of the noble Lord, Lord McCorquodale of Newton, which in another place would lead to a cry of, "Order!" If the noble Viscount wishes the Bill to proceed, I hope that he will address himself' to some of the arguments. So far he has completely failed to address himself to the arguments which I put forward in my Amendment. I specifically asked him to consider certain points.
VISCOUNT COLVILLE OF CULROSS: I do not wish any acrimony to creep in at all, and if I have said anything to give that impression I must apologise. The point, in answer to the noble Lord, is this. I cannot accept the format of this Amendment. The whole principle of it is something I cannot accept. Therefore, with great respect to him, whether the figure put in be 3d., 4d., 6d., 1s. or £1 I still cannot accept it because it has these defects, which seem
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to me to be defects of principle which no change in the denomination of the pennies or shillings in the Amendment is going to cure. I will argue with the noble Lord all night, if necessary, but it cannot change my mind on the principle underlying this Amendment.
LORD DRUMALBYN: I wonder whether I can help a little in this matter because some assertions have been made and we are in a considerable difficulty here because we are trying to legislate on new territory as applied to this country and the only reference we can make is to the practice in other countries. It might help, first of all, if I quote from Mrs. Fulop's researches. I do not think she has been challenged on fact, although her conclusions have been challenged. I would refer to page 58 of her work, where she says this in regard to the United States of America:
"In 15 States legislation stipulates that consumers should be given the option of cash or gifts. In these States"—
and this is an interesting point—
"less than 1 per cent. of all stamps are redeemed for cash. Again, the reasons are, on the one hand, that the trading stamp companies prefer to promote gifts than cash, and, on the other hind, the consumers obtain better value from gifts than cash. There is the further point that consumers may, in any event, prefer merchandise to cash because it is more enduring."
She goes on:
"In five of the States which require a cash option the laws date back to 1905 when stamps were operating on a very small scale. In another eight States the laws have all been introduced since 1959. No State, however, requires any specific cash value. The amount in each instance is determined by the stamp company according to the degree of competition."
I wonder if I might attempt to remove a little of the misunderstanding that has arisen over the translation, as I believe it is intended to be, of the proposal referred to on page 14 of the Consumer Council's study into an Amendment for insertion in this Bill. I think this is at the heart of what the noble Viscount was trying to say, and said so well, if I may say so, but I do not think it has been fully understood. The point is this. The noble Lady made this quotation:
"To discover the average wholesale price per book one divides the sum paid out to the manufacturers"—

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and I interpolate that that must mean the manufacturers of the gifts, that is to say the goods given in return for the stamps—
"by the number of books received for redemption in any given year."
Whatever may be said about a relationship established between the cash value and the value of the gifts that are to be given, I am sure that the noble Viscount is right when he says that if you try to establish a relationship between the stamps, on the one hand, and the merchandise that is sold and with which those stamps are given, on the other hand, you are then taking the matter outside the control of the promoter. This is beyond controversy and it must be so. How can the promoter make certain that the retailer makes no error at all, or that hi assistants make no error at all, in the number of stamps that they deliver? How can he control the relationship between the stamps, on the one hand, and the value of the transactions on the other? How can he see that that is maintained? That is really right outside the control of the promoter, and I think this is what the noble Viscount was trying to say.
I quite understood that the noble Lord, Lord Airedale, then said, "Well, we could put this right at another stage". But, then, if you do that, you are in fact removing the flexibility, because you are merely putting a minimum amount in that relationship between the stamps, on the one hand, and the transactions, on the other. You are establishing a lack of flexibility. You are saying, in effect, that any retailer who uses trading stamps must give a deferred cash discount of at least 1¼ per cent. You are putting on an inflexible lower limit of 1¼ per cent.
LORD AIREDALE: I simply do not understand the English language which the Minister speaks. If you said, "It shall be a 1¼ per cent. ratio", that would be inflexible. But if you said, "Not less than" or for that matter "Not more than", there is nothing inflexible about that. You are merely stopping up one end of the scale.
LORD DRUMALBYN: On the other hand, I would remind noble Lords that there has been some attempt in the course of the proceedings to establish a
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fixed relationship. I rather think that noble Lords—I thought perhaps the noble Lord, Lord Shackleton, in particular—were thinking in terms that, apart from special offers and things of that kind, the minimum would become the regular relationship, and it would in fact be inflexible. I think that this is what would happen if this kind of provision were inserted. I am bound to say that I share the objection of my noble friend Lord Colville of Culross to this, because I think it is unjustifiable to say that anybody who shops in a certain shop which gives trading stamps shall be entitled to a deferred cash discount of at least a certain amount. That does not seem to me to be justified. It seems to me to be a quite unwarranted interference with the freedom of traders to develop various types of schemes.
I have quoted the experience in the United States of America, where only 1 per cent. prefer cash to gifts, and I would say that there really is no evidence that consumers in this country want this kind of definite fixed relationship; and, certainly, I am sure that retailers would not wish it. I think that this would be at variance with the general concept of the Legislature's relationship, in general, to private industry and commerce. Of course, in theory there is something to be said for this kind of arrangement. But as I understood my noble friend, I think that neither he nor I believe that it is possible to devise a practicable and acceptable means of imposing statutory control on the level of the cash value of trading stamps.
I submit that, by establishing in this Bill a provision under which there can always be the possibility of redeeming stamps for cash, we are going as far as is necessary; because by introducing that into the commercial field you are immediately, also, introducing competition in the value of stamps themselves. My own belief is that this is the right way and that it is unnecessary and exceedingly difficult to try to devise a scheme which would introduce a fixed relationship, or even a minimum relationship.
LORD SHACKLETON: I am very tempted to take this Amendment to a Division, and were it not for the lateness of the hour and the fact that it might stop the Bill entirely—I am not sure whether there are enough noble Lords

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here—I should be inclined to do it. This is, of course, a very complicated argument and it is one that we could spend the whole night debating. I am not, I must confess, satisfied by the arguments of the noble Viscount or the noble Lord, Lord Drumalbyn, but I think it is not possible to pursue this matter very much further to-night. I am sorry if I misled the Committee in suggesting that the 4d. would be a fixed amount. I agree that I did rather talk in those terms, though it was because I thought it provided more than a sufficient margin for them to compete if competition came about; but there could be a figure even better than that. In the circumstances, I will not press my Amendment. I do not know what will be the views of the noble Lady with regard to her Amendment, but I think it may well be that we shall want to return to this matter on the Report stage. I ask leave to withdraw my Amendment.
Amendment to the Amendment, by leave, withdrawn.
6.57 p.m.
BARONESS ELLIOT OF HARWOOD: Reverting to my Amendment No. 9, may I say that I have listened to this discussion with considerable interest and, like the noble Lord, Lord Shackleton, I am disappointed. Of course, one of the reasons why people in America do not take cash instead of gifts is because the cash option that they are offered is so very low. Mr. Jameson says in his book, that competition between stamp companies in respect of a cash option is weak, if not non-existent. I have spoken to him about it. I cannot quote him, because one cannot remember one's conversations, but he thought that competition was not enough.
When we discussed it in the Consumer Council, we felt that there should be fairness, and I am only asking for fairness. I am not even suggesting that the floor of 3d. in the £ should be any higher. I would not have supported anything higher, because I think 3d. is fair. The noble Viscount has said that any scheme must be workable, it must be enforceable, it must be fair, and there was a fourth point—
VISCOUNT COLVILLE OF CULROSS: It must not "bust" the stamp companies.
BARONESS ELLIOT OF HARWOOD: This certainly will not "bust" the stamp companies, because, as it works out, it is a wholesale price with, probably, a 10 per cent. margin. In any case, the formula is a flexible one and it depends on the reigning prices, whatever thy are. I have not put any fixed amount in, so it certainly would not "bust" the stamp companies. I think it was the noble Lord, Lord Redesdale, who mentioned the fact that there are certain articles which carry duties, like wine or spirits and so on, for which one is given stamps. I was given stamps the other day in a grocery store for the spirits that I was buying, and there was no difficulty at all about that. They simply issued the stamps, because of the amount of money which I was spending in the store.
I do not think this is as difficult as is suggested, and from all points of view—that of the consumer, the retailer and the stamp companies—this formula would work and would be fair. However, like the noble Lord, Lord Shackle ton, I am not going to press this Amendment to a Division. I am interested in what has been said and I do not think the last word has been said. I think the noble Viscount, Lord Colville of Culross, feels that there should be something in the nature of protection for the consumer in this regard. It should not just be left to the stamp companies to decide what they are going to give, if they are asked for redemption in cash.
The noble Viscount has not said that, but I appeal to him to look at it again before we reach the Report stage to see whether it is not possible to accept this formula or, if it is not the correct one, another one. This is an attempt to make it simpler than the original formula which Mr. Jameson suggested and which I thought was too difficult to work out. It may be that it is not too difficult; I do not know. He says in his Report that it is not difficult at all; I thought it was, and that this one was easier. However, I will not press it any further.
VISCOUNT COLVILLE OF CULROSS: Before the noble Lady sits down, may I say that I will willingly look at any formula which the noble Lady likes to think of or suggest. I should like to look at any formula on its merits, but it must

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be one that fulfils the criteria I have laid down.
BARONESS ELLIOT OF HARWOOD: I do not wish to dispute the criteria which the noble Viscount has laid down. I am prepared to accept that criteria, too; but the difference is that the noble Viscount thinks that my formula does not fulfil that criteria, whereas I think it does. Therefore, that is a difference of opinion. I am quite prepared to work on it again, and to work on it in conjunction with the noble Viscount if that is possible. But, as the Committee knows, I do not intend to take this any further to-night, and I therefore beg leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
VISCOUNT COLVILLE OF CULROSS: This is one of a series of paving Amendments for Amendment No. 41. I beg to move.
Amendment moved—
Page 2, line 16, leave out ("commencement of this Act") and insert ("coming into force of this section").— (Viscount Colville of Culross.)
On Question, Amendment agreed to.
VISCOUNT COLVILLE OF CULROSS: This is a drafting Amendment. I beg to move.
Amendment moved—
Page 2, line 25, leave out ("or") and insert ("and").—(Viscount Colville of Culross.)
On Question, Amendment agreed to.
On Question, Whether Clause 2 shall stand part of the Bill?
LORD SHACKLETON: Would it be convenient for the noble Viscount to tell us how far he hopes to reach to-night?
VISCOUNT COLVILLE OF CULROSS: This is not a matter that is altogether in my hands, and I wonder whether my noble friend Lord Goschen can assist in any way.
VISCOUNT GOSCHEN: I think it has been agreed through the usual channels that the Committee should stop at 8 o'clock.
Clause 2 agreed to.
Clause 3:
Redemption of trading stamps for cash
3.—(1) If the holder of any number of redeemable trading stamps which have an aggregate cash value of not less than five shillings so requests, the promoter of the trading stamp scheme shall redeem them by paying over their aggregate cash value.
(3) In this section "redeemable trading stamps" means trading stamps delivered after the commencement of this Act in accordance with a trading stamp scheme upon or in connection with the purchase of any goods or the obtaining of any services for money, and "the holder", in relation to such a trading stamp, means the person to whom it was so delivered or any holder without notice of any defect in title.
(4) This section shall also apply to trading stamps so delivered before the date of the commencement of this Act if a cash value is stated on their face unless they show on their face that they were so delivered before that date.
LORD AIREDALEhad given notice of his intention to move, in subsection (1), after "an aggregate cash" to insert "face". The noble Lord said: I think this matter is covered by the interpretation clause. Accordingly, this Amendment is not moved.
7.4 p.m.
LORD AIREDALE LORD AIREDALE moved, in subsection (1), after "scheme" to insert:
"or the occupier or other person having control of any shop at which the scheme is operating ".
The noble Lord said: This is an Amendment designed to secure that, where stamps are redeemed for cash, they shall be redeemable for cash not only at the place of business of the promoter of the stamp scheme, but also at any shop which is running the scheme. I should have thought it was almost unseemly that when 5s. worth of stamps had been collected by a customer of a trader running a trading-stamp scheme, and she has brought them in for redemption for 5s., he should say to her, "Well, that is nothing to do with me. You have got to send those stamps to the promoter to get your 5s." If that conversation took place in a grocer's shop in Dundee, and the place of business of the promoter of the scheme was in London, I should not think the lady would be very pleased.
I suppose she would say, "Have I got to go home and write a letter to these

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people, about whom I know nothing, sending them all these stamps? Am I supposed to register the letter? If so, how much of the 5s. is that going to use up; and how long is it going to be before they bother to send me my 5s. at Dundee? Presumably, you, the grocer, are in daily or weekly, or frequent, touch with your friends the promoters of this trading-stamp scheme. I imagine you can use your good influence to get my 5s. out of them pretty promptly, otherwise you will want to know the reason why. Therefore, I would have thought it was fairer that you should redeem the 5s. for me over the counter of this shop". That, I should have thought, was a reasonable argument. I do not know what arguments there are against it. I suppose it could be said that somebody might suddenly walk into the village store that sells everything with £50 worth of stamps to be redeemed and that this would embarrass the small shopkeeper.
VISCOUNT COLVILLE OF CULROSS: Hear, hear!
LORD AIREDALE: But may I point out that this clause does not even require the promoter to hand over spot cash? All it says is:
"If the holder of any … stamps … requests"
the promoter to pay cash. There is nothing in the clause at all about payment on the spot. So I should have thought that the small shopkeeper, faced with having to redeem £50 worth of stamps for cash, would simply say: "Certainly. Hand me the stamps and I will send them to the promoters. Then, as soon as the money comes through, you shall have it". I do not say that the noble Viscount is going to use that argument against me this evening, but it has, I think, been used in the past elsewhere, and I do not think much of it. I should have thought it was only seemly that this cash redemption should be allowed to take place, at the option of the customer, in the shop, and that it is a positive bar—another bar—that cash redemption should require the wretched housewife to have to send her stamps all the way to some distant place where the promoter has his business. I beg to move.
Amendment moved—
Page 2, line 37, at end insert the said words. —(Lord Airedale.)
VISCOUNT COLVILLE OF CULROSS: I appreciate the problem which the noble Lord, Lord Airedale, poses, and it is one which I do not think is by any means unreal. I very much hope that it will not be as difficult as all that for housewives to redeem their stamps for cash. I hope that there will be redemption centres, run by the stamp-trading companies, fairly widespread over the country. I also very much hope that the trading-stamp companies will make voluntary arrangements with retailers to do precisely what the noble Lord wants. Of course, there is no reason why they should not do so, and I think it will be, as the noble Lord says, the most seemly way of doing it. It is a different matter, however, to legislate that the retail shop must act in this way; and I think that, if the noble Lord looks at it in the way that I am now going, to expound, he will see that there are rather more objections than he perhaps foresaw.
The effect of this Amendment will be that a trading-stamp company, the promoter of a scheme, will be completely underwritten by the retailers who use his stamps. They will be required by law to redeem every single stamp that is issued under the scheme. They will be required, each of them, to redeem all the stamps that have been issued under the scheme, because I do not believe that it would be in any way possible to discriminate between stamps issued at the grocery store, the petrol station, the ironmonger and so on, and require only the ones issued at a particular shop to be redeemed by that shop. There might not even be 5s. worth of them in the first place. So I do not think that this is a practical possibility.
If that is not so, then each shop must be required by this particular Amendment to redeem all the stamps, and this will be so whether those stamps have been issued after or before that company or that shop had gone into the business of issuing stamps with its goods, because there is no time limit whatever in the noble Lord's Amendment. This may be very nice for the trading-stamp company,

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because it will then be completely secured and will know that, whatever may, happen to it, it is completely underwritten as to the cash redemption of all the stamps that have been issued by retailers all over the country.
I do not believe that that is the effect that the noble Lord wishes his Amendment to have. It is certainly not one that I would think is right. I think that the duty of redeeming these trading stamps for cash ought to be upon the promoters of the scheme who issued them in the first place, and not on the retailer, who would in fact have this function under the Amendment. I therefore hope that the noble Lord will feel able to withdraw his Amendment.
LORD REDESDALE: The noble Lord mentioned that it was going to be necessary to send off to some far distant place all the stamps collected, if it were not insisted that cash should be paid over on the spot. But it would be much quicker for the housewife to send off to the stamp company and get the money back direct than to go to the retailer who then sends the stamps off, waits for the reply to come back and redeems them when the housewife goes again to the shop. I can appreciate that the noble Lord is trying to assist the housewife, but I feel that this may be an even longer way round than by her sending off the stamps direct.
LORD AMPTHILL: As I listened to Lord Airedale's story of a mythical housewife in Aberdeen or Dundee, I felt strong sympathy for her, but when I listened to the noble Viscount, Lord Colville of Culross, I recalled my own experience. My wife collects stamps of a certain colour because she hopes one day to exchange them for some kitchen equipment. I do not collect stamps; but the other day I filled up my car with petrol at a station that I do not usually use and I happened to get stamps of the same colour as those my wife was saving. Naturally, I handed them over to her and got a "bouquet" for bringing nearer the day when the kitchen equipment may arrive. But if, when she has a quantity, she takes them back to the small cleaner's shop where she collects most of her stamps, I feel it will be pretty hard on them to have to redeem also the stamps I got from the
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petrol station. I think the noble Viscount made a very strong case.
LORD AIREDALE: In answer to Lord Redesdale's point, I would point out that it might take longer to carry out the redemption via the grocer than direct to the promoter, but, after all, if it is a matter of 5s.—and I imagine that most of the redemptions will be in units of 5s.—I should have thought that most grocers in a substantial way of business would be only too pleased to hand 5s. over the counter and then, within a reasonable space of time, be refunded the 5s. by the promoter.
Coming to the main objection to my Amendment which was voiced by the noble Viscount, Lord Colville of Culross, I would ask whether it would make the noble Viscount any happier if we were to seek to insert into this Bill an Amendment to cover the situation which I understand, on very reliable grounds, obtains in Canada. In this case the customer must have a book for each store and cannot put stamps from supermarket "A" into the book of supermarket "B", even if both stores issue the same colour stamp. In this connection, I shall quote from a letter from a reliable source:
"Stamps must be redeemed from the store which issues them."
Would there be the slightest difficulty in a grocer rubber-stamping the books he gives out from his store, so that only the stamps in his book need be redeemable by him? If arrangements of that kind were acceptable to the noble Viscount, perhaps we could at the next stage of this Bill agree to the Amendment I have moved, together with an Amendment to secure the provision which I have just outlined.
VISCOUNT COLVILLE OF CULROSS: No, I do not think I could possibly agree to that. It would make one aspect easier; but it would seem to throw up a large number of other complications about which I should have to think and look at in detail. It still does not overcome my cardinal point: that any system of this type will require the retailer to underwrite the entire outlet of the stamps issued by a company. It does not matter who does it. but all the issue will be underwritten by some retailer or some block of retailers who will be carrying the whole burden. And

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this, in my view, is not where the burden should lie.
LORD AIREDALE: I think that perhaps both I and the noble Viscount had better think more about this between now and the next stage. I will withdraw this Amendment in the light of what the noble Viscount has said about the possibility of voluntary arrangements being made between the promoter and the retailer. If, before the next stage of the Bill, there is a real and genuine possibility of a satisfactory voluntary arrangement of this kind coming into force, I may be satisfied. But if I am not so satisfied I shall return to this matter on the Report stage. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
7.16 p.m.
LORD AIREDALE LORD AIREDALE moved, after subsection (1), to insert:
"() No trading stamps shall be redeemed for goods of any description not normally dealt in by the person issuing the said trading stamps."
The noble Lord said: This is an Amendment over which I am expecting to be taken to task on two grounds: first, that it is unhappily worded—though this is a matter we might manage to overcome—and, secondly, that it would be totally unworkable because it would necessitate a complete change in the system of operation of trading stamp schemes. Nevertheless, this Amendment enables me to put before the Committee what I regard as one of the evils of the trading stamp system: namely, that stamp trading has the effect that the retailer of one class interferes detrimentally with the business of a retailer of another class. As I think we all appreciate, the vast majority of the retailers operating stamp schemes are grocers. The promoters know better than to choose items from the grocers' list for their gifts. You do not usually find in the gift catalogues boxes of chocolate biscuits, tongues in glass, tins of ham and delicacies of that sort, for the obvious reason that when the grocer saw these items in the gift catalogue he would say to the promoter: "Look here, what I am going to gain on the swings I am going to lose on the roundabouts; because I am not going to sell
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my glassed tongue and tins of ham if you give these things away as gifts". So the wise promoter has for gifts not so much grocery as attractive electrical goods and attractive pots and pans from ironmongers' stores.
So if there is anything to be gained in stamp trading it is the grocer who gains it, and if there is anything to be lost it is the electrical dealer and the ironmonger who lose it, because they are losing the trade they might otherwise have had in selling to the public these things in which they deal and which become gifts. I should have thought that this was a mischievous evil of stamp trading and something which ought to be stopped. I do not know that this Amendment in these words is going to satisfy the noble Viscount; but this is a matter which deserves the attention of the Committee, whose views I shall be interested to know. I beg to move.
Amendment moved—
Page 2, line 38, at end insert said subsection. —(Lord Airedale.)
VISCOUNT COLVILLE OF CULROSS: I shall be glad to tell the noble Lord my view: it is, as he suspected, that this Amendment is quite unworkable. The noble Lord must envisage what would happen. There would be in a town, as there always are, a family of outlets for trading stamps. Some might be issued by the grocer, some by the hairdresser, some by the garage, some by the dry cleaner and some by the electrical shop. Under the noble Lord's scheme, a housewife would need to have a separate book for each, as the noble Lord says is done in Canada. In order to get any of the goods in the catalogue she would have to save up the stamps from the shop into whose category the goods came. If she wanted an electric kettle, she would have to save stamps in the book she got from the electrical dealer; if she wanted a tin of tongue, she would have to save up stamps from the grocer. The net result would be that she would never save up enough stamps at all to get the majority of goods, because she would not be able to amalgamate those coming from the whole family of shops. This would stultify the entire scheme. Imagine the difficulty of a stamp company redeeming in kind hairdressing, taxi-driving and petrol and oil stamps. It

401
simply could not be done. I shudder to think what would happen if you sent large quantities of groceries through the post under this scheme as well.
I do not think the noble Lord could envisage this working in practice, and I hope he will withdraw his Amendment. The point he makes is perhaps one of the reasons why he thinks trading stamps are a bad idea. This is a matter of opinion, to which the noble Lord is perfectly entitled. One of the notable pieces of research I found in the course of studying the background of the Bill contains a suggestion that rather the contrary is the case. For instance, a housewife may acquire as a gift a pretty glass or cup and saucer, and it has been found that this often spurs her to buy the rest of that set or pieces to match at the glass and china shop. I do not know to what extent this happens, but, if it does, then the shop has got trade it might not otherwise have got. Therefore I do not think the noble Lord is necessarily right in being 100 per cent. pessimistic.
LORD AIREDALE: The noble Viscount is so eloquent that he makes me appear as if I were a bull charging about in a china shop. I would remind the Committee that the Amendment is not quite so silly as the noble Viscount makes it sound. The objections which the noble Viscount so eloquently put forward have in fact been overcome in France, in Western Germany and in Canada. However, since I am satisfied that the Amendment in this form is not likely to be acceptable to the Committee, I beg leave to withdraw it.
Amendment, by leave, withdrawn.
7.25 p.m.
LORD AIREDALE LORD AIREDALE moved, after subsection (1), to insert:
"() The holder of any number of redeemable trading stamps fading short of the number demanded by the promoter of the trading stamp scheme in exchange for any particular goods who tenders trading stamps together with a cash sum equal to the aggregate cash face value of any trading stamps outstanding shall be entitled so to redeem the said goods."
The noble Lord said: The purpose of this Amendment is to secure that if a stamp collector has collected a certain number of stamps towards some so-called gift and she desires, for whatever reason to get her gift straight away, she shall be entitled to do so by tendering to
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the promoter the stamps she has collected, together with a cash sum equal to the cash value of the balance of any stamps outstanding. If she has collected, for example, half the number of stamps that will secure a bicycle for her son and tenders those stamps, together with the cash value of the other half of the number of stamps required, then she is entitled to have the bicycle.
I should have thought that this was a reasonable proposition. One of the virtues of this Amendment is that it gets the cash redemption value of trading stamps right—as a by-product, as it were. It works in this way. If the value put on stamps by the promoter is too low then, by tendering a balance in cash, the stamp collector gets a good bargain. if the value placed on the stamps is too high, then the stamp collector chooses cash redemption. I think that an arrangement of this kind gets the cash value of trading stamps right, and I still suggest that it is a fundamental and urgent necessity, before this Bill leaves this House, to secure that the cash values of trading stamps are right. Parliament would have wasted its time and would merely have been enabling stamp promoters to snap their fingers at Parliament, if the Bill were to pass into law without the cash redemption values being reasonable, sensible and right.
The other virtue of an Amendment of this kind is that it frees both the retailer and the stamp collector from a stamp scheme, if they wish to escape. Supposing the retailer, for whatever reason, chooses to finish with the scheme, he can do so with a clear conscience under this Amendment, because he can say to all his disappointed customers who have been collecting that they can either redeem for cash the stamps they have, or tender the balance, in cash, over the number of stamps they have to secure the gift for which they had been saving. And a housewife who has been collecting stamps and then finds that her husband is suddenly transferred to a new job, so that she has to move to a new locality where the kind of trading stamp she has been saving is not available at her local shops, is soothed in her disappointment because she can either redeem the stamps for cash or tender the balance to secure her gift. Since this Amendment appears to secure so many admirable advantages,

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very much hope the Committee will accept it. I beg to move.
Amendment moved—
Page 2, line 38, at end insert the said subsection.—(Lord Airedale.)
LORD REDESDALE: I would point out to the noble Lord, Lord Airedale, that, on the basis of his Amendment, all that any housewife would have to do is to collect one stamp and then send it in with the cash balance. I do not think the Amendment would be workable, unless a provision were made whereby the fall-short was in the interest of the customer, so that she could get her gift, if something did happen and she was only a few stamps short. But if the provision is to be unlimited, the stamp companies could not operate.
LORD SHEPHERD: I do not think the Amendment is practicable in the context of trading stamps, though most of us would share the sentiments behind it. I anticipate that the noble Viscount in charge of the Bill will ask the Committee to reject the Amendment. Anticipating that, I would ask him: what is the result of a decision by a trading stamp company to cease distribution of stamps in a particular locality? I explained in our debate in December that I could envisage a stamp company, having sold a considerable number of stamps in a particular area, wishing to get out of redeeming the stamps and ceasing its arrangements with the stamp distributors in the area, thereby leaving many of the customers with stamps that were of no value. To a certain extent that problem is overcome by the fact that under the Bill the stamps can be redeemed in cash. But we all recognise that there is a difference between the cash received and what a person can receive in value in kind.
The stamp companies are making an offer to the public through a catalogue of what can be obtained after collecting a number of stamps. It would seem to me that where a company ceases to distribute stamps in a particular area, then the stamp collector should have the right to obtain out of the catalogue, by payment in cash, the article for which he is making claim or for which he is saving. This would overcome the possible hardship to the person who may be saving up for a television set, or something of considerable value, and finds that she can no
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longer get the stamps. I appreciate the difficulty that a person may have collected, perhaps, only ten books, as against the three or four hundred required for the particular article; and it may be hard on the stamp company which genuinely decides to go out of the area, the trade there not being good, that this person with ten books should be able to put in cash value for the other 390 books. But we could get over that difficulty, I think, by saying that if a stamp company ceases to trade and distribute stamps in an area, then the stamp collectors who have collected, say, 75 per cent. of the stamps required for a particular article should be able to pay the balance in cash. Perhaps the noble Viscount will have discussions with his friends who are helping him with the Bill to see what a reasonable percentage would be up to which stamps would have to be collected before the collector could obtain the gift by paying the difference in cash.
I would not support the noble Lord, Lord Airedale, to the extent that he has gone in this Amendment—that a person should be able to do it irrespective of the circumstances —but I think it is quite a different thing when a stamp company, having made an offer to the public, decides, for one reason or another, to alter its policy, leaving people with stamps which are not of the value they had put to them when they were collecting the stamps. I hope that the noble Viscount has taken the point of what I am saying. It is a good deal more limited and more specific, and has a good deal more merit, I feel, than the Amendment moved by the noble Lord, Lord Airedale. I cannot imagine that the noble Viscount will accept the Amendment, but I hope he will consider whether it is possible to draft something on the lines I have suggested. In that way, I think, we should get over some of the fears that some of us have about stamp companies deciding that it pays them to get out of an area because the stamps will be of less value to the collector than they would be if they were redeemed.
VISCOUNT COLVILLE OF CULROSS: I am, of course, always willing to consider any new idea, and this is a new idea. But certain difficulties immediately spring to my mind. First of all, what, for this purpose, is an area? There is another difficulty inherent in the noble Lord's suggestion. It is true that some

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people may start off by collecting stamps for a particular article. But one cannot legislate for this. If they have ten books, and they say they want a scooter, why should the stamp company be bound to give them a scooter, when it could perfectly well give them something for ten books? I am not sure what the principles inherent in this proposal are, and I think it requires a certain amount of thought.
LORD SHEPHERD: The noble Viscount will recall that I suggested that the collector must have achieved a reasonably high percentage of the total of stamps needed for the article she claims to be saving for.
VISCOUNT COLVILLE OF CULROSS: That is certainly an amelioration. But the collector could probably get something out of the catalogue, even for what she has saved. I should like to think about this matter.
It seems to me that the Amendment moved by the noble Lord, Lord Airedale (and the last thing I want to do is to be acrimonious), comes very strangely from the noble Lord. He has just complained about the damage that trading stamp companies do to other retailers, and now he is setting up the stamp companies in the way of being the biggest cut-price wholesale house at which goods can be bought in competition—and very much cheaper than from ordinary retailers, I should think, in the entire country. My noble friend Lord Redesdale has already put his finger on the difficulty. You get one stamp and spend 6d. in a stamp shop; you can then go to the stamp company and buy anything in the catalogue at wholesale price or thereabouts. If this is not a direct contradiction of the principle of which the noble Lord was complaining a moment or two ago, I do not know what is. There is this other difficulty—and there is an ulterior motive in what the noble Lord sand; I recognised this from the beginning, because, I, too, thought of this scheme. It is possible by this means to prevent the pegging of the price.
If we say that the one-stamp suggestion is ridiculous, and that the person must have collected a certain proportion of the total towards the article he is seeking to get, as was suggested by the noble Lord, Lord Shepherd, then the
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problem is how to hit on the right proportion. If we make it too low, it will cut out the gross margin of profit of the stamp company in such a way that it will "bust" the company. The noble Lord must realise that the stamp company must make provision for this happening. They do not have to deal with the problem only when it arises: they have to finance on the basis of what goes into the Bill. I do not think the noble Lord appreciates what they will have to set aside for this purpose. Equally, if we set the proportion of stamps too high, there will be so little in it that the stamp company may not he forced in the way I have suggested to put the price in the right place. I do not know what percentage might be suggested, but none has been suggested for this particular purpose, and I have been quite unable to find one which does not cut across one of these difficulties.
But the major objection is the one that I mentioned first of all: that the noble Lord is setting up the stamp company in competition with all the other retailers in a much more severe form than he was complaining of in the first place. Therefore, I hope your Lordships will feel that it is not right to accept this Amendment.
LORD AIREDALE: I think there is great force in the argument put forward by the noble Lord, Lord Redesdale, and the noble Viscount, that it would be perhaps a rather Gilbertian situation that you should buy one trading stamp and then tender £163 and get a scooter in that way. I think that possibly there is scope for amendment of this Amendment, so as to secure that there shall be a sensible proportion of stamps collected and only a proportion of the value of the gift shall be paid for in cash. The noble Viscount seemed to think that it was difficult to get the right proportion. Perhaps we could come together and have discussions after this stage of the Bill, to see whether we can work out the proportion that seems to be right; because I am sure that something could be achieved on those lines.
I am not attracted by the argument of the noble Viscount that if the lady is half way towards the bicycle that she is trying to secure for her son, and then has to stop collecting, she must make do

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with some other gift that exactly corresponds with the total number of stamps she has collected.
VISCOUNT COLVILLE OF CULROSS: Or cash redemption.
LORD AIREDALE: Or cash redemption. That does not seem to be a very inviting prospect for the stamp collector. I was not impressed by that argument, but upon that basis perhaps we can get a proportion of stamps-for-cash rate and return to this matter at the next stage. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
7.40 p.m.
VISCOUNT COLVILLE OF CULROSS VISCOUNT COLVILLE OF CULROSS moved, after subsection (1), to insert:
"() The holder may exercise his right under the foregoing subsection—

(a) by presenting the stamps at any reasonable time at the promoter's registered office, or

(b) by sending the stamps by post to that office with sufficient instructions as to the manner in which the cash value is to be paid over,

or in any other manner afforded by the promoter."
The noble Viscount said: This is an attempt to block up what I believe is a loophole in this Bill. Your Lordships will have heard me say already that it is impossible by contract to surrender or modify the right to cash redemption under Clause 3. However, as the Bill is drafted, it might have been possible to impose practical limitations upon the stamp-holders' rights which would have had the same effect, without actually modifying or surrendering the right as such. In other words, it might have been possible for the stamp company to say that nobody could redeem for cash unless they turned up at the registered office between nine and nine-fifteen, and the registered office was in John O'Groats. This would have been entirely within the terms of the Bill, but is not the desired effect of this legislation.
This Amendment, I hope, cures this defect by laying down that at least it will be possible to redeem these stamps by going in person to the registered office at a reasonable time, or by sending the stamps by post to that office with sufficient instructions for the manner in which the cash is to be paid, and the stamp
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company may make any more favourable arrangements it thinks fit. This, I hope, will include, perhaps, redemption through the traders who issue the stamps, or perhaps through the redemption centres themselves. I hope this Amendment will meet with your Lordships' approval. I beg to move.
Amendment moved—
Page 2, line 38, at end insert the said subsection.—(Viscount Colville of Culross.)
LORD SHACKLETON: Obviously, the Committee will welcome this. It still leaves a number of problems unsolved. The noble Viscount knows them as well as the rest of us do. There will be the problem of whether you must use recorded delivery to make sure that they have arrived, and so on. I wish it could be more easy. We always talk about John O'Groats. There may not be much stamp trading there for people to walk in somewhere and exchange them. None the less, I think this is a good Amendment, and it certainly helps the purposes of the Bill.
On Question, Amendment agreed to.
VISCOUNT COLVILLE OF CULROSS: This is a paving Amendment. I beg to move.
Amendment moved—
Page 2, line 44, leave out ("commencement of this Act") and insert ("coming into force of this section").—(Viscount Colville of Culross.)
On Question, Amendment agreed to.
VISCOUNT COLVILLE OF CULROSS: Something has gone wrong with the definition of "holder". It has become a circular definition, with the word "holder" both in the definition itself and in the explanation of it. I have attempted to put this right by this Amendment, and I beg to move.
Amendment moved—
Page 3, line 5, leave out ("holder") and insert ("person who holds it").—(Viscount Colville of Culross.)
On Question, Amendment agreed to.
VISCOUNT COLVILLE OF CULROSSmoved to insert at the beginning of subsection (4): "Subject to the following subsection". The noble Viscount said: If I may, I should like to speak to this Amendment and Amendment No. 26 together, because No. 26 is really the point in substance, and Amendment No. 24 leads up to it. Until the Bill had got well

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under way in another place the practice which is now known to your Lordships was not known—that stamps were being issued with a figure on them, such as "3", "4" or "6", indicating the amount of money you had to spend in the shop in order to get that stamp. There is clearly a difficulty under the Bill, as it stands, in that if nothing was done those stamps would in due course, when the section comes into effect, be redeemed at their face value of 3d., 4d. or 6d. This I think, would be considered unfair, because many of them were issued long before the idea of cash redemption under this Bill ever came about at all.
Paragraph (b) of this new subsection deals with this, and it gives the company issuing these stamps a period of time in which to end this practice. If they can show that the stamps were issued within six months after the passing of the Bill, then they will not have to redeem them subsequently for their face value. There is a re-wording of paragraph (a) regarding the stamps which may already be being issued, or which may be issued within the time during which this subsection is coming into force, that is, within the first twelve months. A difficulty was foreseen that if a stamp company issued stamps after this Bill became law it might subsequently refuse to redeem them when this subsection came into force, because it would say they had been issued before the subsection came into force. It might, by that means, be able to cover itself against a great degree of cash redemption. Paragraph (a) of that subsection deals with that point. These are only transitional and drafting matters, but I think they should be put right in the Bill. I beg to move.
Amendment moved—
Page 3, line 6, at the beginning insert ("Subject to the following subsection").—(Viscount Colville of Culross.)
On Question, Amendment agreed to.
VISCOUNT COLVILLE OF CULROSS: This is another paving Amendment to Amendment No. 41. I beg to move.
Amendment moved—
Page 3, line 7, leave, out ("commencement of this Act") and insert ("coming into force of this subsection").—(Viscount Colville of Culross.)
On Question, Amendment agreed to.
VISCOUNT COLVILLE OF CULROSS: I beg to move.
Amendment moved—
Page 3, line 8, leave out from ("face") to end of line 9 and insert—
("(5) This section shall not apply—

(a) to trading stamps which have been so delivered before the date of the coming into force of this section and which show on their face that they were so delivered before that date, or

(b) to trading stamps which have been so delivered not later than six months after the passing of this Act and which show on their face, instead of any reference to any kind of value to the holder, a value indicating the sum paid on the purchase or other transaction in connection with which they were delivered or some other value which, having regard to the terms of the trading stamp scheme, it would be unreasonable to take as their value for the purposes of redemption under this section").—(Viscount Colville of Culross.)

On Question, Amendment agreed to.
7.47 p.m.
BARONESS ELLIOT OF HARWOOD BARONESS ELLIOT OF HARWOOD moved to add at the end of the clause:
Page 3, line 12, at end insert—
(" (6) Upon delivery of a trading stamp to any person (in this and the next two following subsections called 'the holder ') in connection with the sale of any goods or the performance of any services there shall enure to the holder the right either—

(a) to redeem that stamp (subject to the provisions of this section) for the cash value shown thereon, or

(b) to exchange that stamp for any goods properly described to the holder as being exchangeable therefor;

and any condition or term of any contract or offer which purports to enable that right to be extinguished without the oral or written consent of the holder shall be of no effect.
(7) In the last preceding subsection 'goods properly described to the holder as being exchangeable therefor' means goods—

(a) which have been described in any announcement or advertisement as being exchangeable for stamps of the kind delivered to the holder, or

(b) which have been the subject of any declaration or allegation, made to the holder by any person concerned in the transaction in connection with which the holder's stamps were delivered, to the effect that they were so exchangeable.

(8) At the time of delivery to the holder by a supplier of any goods in exchange for that stamp as provided for in subsection (6)(b) of this section of this Act, there shall subsist between the holder and the supplier a contract for the sale of such goods within the meaning of section 1(i) of the Sale of Goods Act, 1893, and to which the provisions of that Act shall apply.")
The noble Baroness said: This Amendment refers to the holder of stamps, who is in a peculiar position. He has no rights, as a holder of a share certificate has in a company. He has no legal rights either to redeem his stamps or to obtain cash. In my Amendment, in paragraphs (a) and (b) his legal rights as holder of stamps are stated clearly to be (a) to redeem for cash, and (b) the right to exchange stamps for the goods offered. It follows from this that the stamps or books must belong to the holder. There is a practice in some companies to print very small words saying that the stamps and books are the property of the stamp company. If there is to be a fixed cash option, it is obvious that the holder of the stamps should be the owner. Subsection (6) makes this clear. Subsection (7) of the same Amendment links the holder of stamps to the advertised goods in the redemption shop or in the catalogue. It gives him the right to go into the redemption shop, and say, "I want such and such an article in the shop or in the catalogue." It gives him the right to exchange his stamps for the goods he has chosen, and to hold the company to their promise to exchange the stamps for the articles offered.
The last paragraph in my Amendment refers to bringing stamp trading under the Sale of Goods Act, 1893. All shoppers in this country are covered in their buying by the Sale of Goods Act. This, as noble Lords will remember, gives us the right to have defects remedied or to receive compensation for defects in what we have bought. We should like this safeguard applied to the stamp collector who has exchanged his stamps for goods. For example, if he acquires a piece of electrical equipment, let us say, and it is unsatisfactory, he may be able to take it back to the redemption centre and get the same treatment as he would if he had bought this article in an ordinary shop. I think this Amendment fills a gap, as the noble Viscount mentioned in one or two of his Amendments, and I hope it is one to which the Committee will agree and the noble Viscount will be able to accept. I beg to move.
Amendment moved—
Page 3, line 12, at end insert the said subsections.—(Baroness Elliot of Harwood.)
LORD REDESDALE: I sympathise with the noble Baroness's view on this matter, and I agree with her intentions, but I would submit to her, with all due respect, that perhaps there is a slight looseness in the wording. Subsection (7)(b), for instance, leaves it rather open —to give an extreme and facetious example—for a shop assistant to say that a customer need give only two stamps for a Rolls-Royce. It would be possible for everybody along the line—for instance shop assistants—to make arrangements with the customer to which the company would be held. All I would suggest is that the noble Baroness should look at this particular point.
VISCOUNT COLVILLE OF CULROSS: The noble Baroness has tackled an extremely difficult subject and I am sure that she recognises this. Perhaps I could deal first with the Sale of Goods Act point. The whole of the provisions of that Act, quite clearly, are not applicable to stamp trading: there are many things in the Act which have no bearing on the subject at all. Equally, in the transactions we are discussing there is not a sale of goods, and I think it would be better to try to establish rather more clearly what the noble Lady means for the Sale of Goods Act relationship to exist. I suppose it would be between the stamp company and the stamp collector. Then there is, further, a much more fundamental difficulty, in that the Molony Committee—and perhaps my noble friend Lord Drumalbyn can help a little on this point—as I understand it, have recently recommended that a wholesale review of the Sale of Goods Act should take place. One of the points that certainly ought to be looked at is the fact that at the moment the Sale of Goods Act conditions and warranties are capable of being contracted out of, and very frequently are. The noble Lady's Amendment would not prevent that and it would be perfectly possible, by putting a suitable term in the catalogue, to contract out of everything the noble Lady seeks to achieve. This would get us nowhere.
To say in this Bill that contracting out would not be allowed would, I should have thought, have been wrong, because it is something that must be dealt with in the general context of the Sale of Goods Act and as part of a general

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review of that measure. Therefore I feel there are grave difficulties in importing the whole of the Sale of Goods Act in the way that the noble Lady has sought to do. But perhaps it might be possible for my noble friend Lord Drumalbyn to say something about that. If there were a wholesale review of the Act there might, I suppose, be a possibility of putting something in a new Bill which dealt with a trading stamp relationship, if that were thought right. I should have thought it was proper to do so in that type of Bill rather than in this one.
As to the first part—and this is a difficult problem, apart from certain matters of definition—the fundamental difficulty in in paragraph (a) of the noble Lady's subsection (6). I think that paragraph (a) is quite unnecessary because cash redemption is already covered elsewhere. Paragraph (b) gives the holder the right to exchange stamps for the goods properly described in words set out; that means goods which one is given to understand are exchangeable for stamps of that kind. There is no reference to any particular quantity of stamps, and in effect this provision would, I think, entitle the holder of any stamps to exchange them for any article offered in the catalogue. This is again the same problem. He could require a motor scooter, to be given to him in exchange for one stamp without paying the difference. That is not, of course, what the noble Lady wishes.
Furthermore, it is hard to see in what way a statutory right to goods could be defined in terms which are fair to the stamp promoter and mean something to the stamp holder. The difficulty is to determine what goods the holder should be entitled to have and at what point of time. Certainly, I do not think it is reasonable to expect the promoter to provide, in exchange for a number of stamps, specific articles described in his catalogue at the time the catalogue came out and when the collector had no stamps at all. Certainly there is the other problem that if, as it were, a deemed contract arose at that stage, it would be very difficult for the collector to justify that he had chosen a particular article he had not yet earned, and equally difficult for the stamp company to guarantee that when that article had been earned it might not have gone out
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of production or had its price changed or been replaced by something better. At the moment stamp companies always provide that they shall have a certain flexibility in the articles that are provided, to guard against the fact that some books are filled slowly and against some people setting their hearts on a certain article and finding that it is not made anymore or that it costs a great deal more because of a purchase tax change.
All this has to be taken into account. With great respect, the noble Lady has not done so. The best that could be done would be to provide that the holder of a full book of stamps or more than one book of stamps should be entitled to redeem them for any article that the promoter has offered to exchange then for. This surely will be done by the trading stamp company, in any case, because if it did not, its name would soon get abroad and it would lose all the custom it had hoped to gain. This is the whole essence of the trading stamp scheme: that you should be able to go to the redemption centre and get the goods you have chosen. I cannot think there is any point in putting in a statutory right to that effect. I think this is the only practical way in which you can create a contract for certain goods between the person collecting stamps and the stamp company which would not suffer from the defects I have mentioned. Although I am sympathetic with the noble Lady in this matter, I hope she will recognise that there are practical difficulties and will feel that she does not wish to press this Amendment any further.
7.57 p.m.
LORD SHACKLETON: The noble Lord, Lord Redesdale, would obviously have liked to see something like this in the Bill. It is a rather terrible admission—and I am not blaming the noble Viscount—to say that these transactions (and whether the noble Lord, Lord Redesdale, likes to call one of them a sale or a gift, the fact is that it is a transaction) are not susceptible to the protection that a Statute provides in other ways. I am sure the noble Viscount does not disagree with this proposal; the problem is of finding a way to do it.
VISCOUNT COLVILLE OF CULROSS: And of stopping them contracting out.
LORD SHACKLETON: As the noble Viscount says, there is also the problem of contracting out. I am wondering whether, despite the apparent inequity, it would not be possible to apply certain sections of the 1894 Act, particularly those that apply to sale by description —Section 14, and the provisions regarding conditions and quality of the goods. The noble Viscount has suggested that the protection of the consumer—let us face it, the stamp holder is a consumer in this matter—is that he will go to the store and either get the goods and go away satisfied or he will not, in which case there will be a lot of trouble—and thank goodness there is the noble Baroness, Lady Elliot of Harwood, and the Consumer Council looking after him!
But of course, we do not operate simply like this; we bring a great mass of legislation in various ways to protect the public; and we are supporting this Bill because we reckon it is helping us along. I think that what this debate, and particularly the proposals of the noble Baroness, are bringing out, is just how little control there is of these activities and how far there ought to be really comprehensive legislation. It may well be that the noble Lord, Lord Drumalbyn, if he is going to comment on this subject with the possibility of the revision of the contracts under the Sale of Goods Act, will be able to say whether some way can be found to extend that Act to transactions of this sort. I do not know what the noble Lord, Lord Redesdale, would think. He perhaps would like stamp companies to operate wholly outside any sort of legislative protection.
LORD REDESDALE: That is not what I was saying. I was agreeing with what the noble Baroness was saying. I did not say for one moment that I wanted them to be able to contract out. I was pointing out that what she was putting in here at the moment was a little loose and ought to be tightened up.
LORD SHACKLETON: I am glad to hear that. The fact is that there is a need for further control, and of course we shall have the advantage that no doubt the Consumer Council will watch this. I imagine the noble Baroness will not press this, but I would again con-
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gratulate her on the gallant attempts she is making on behalf of the public.
LORD SHEPHERD: We do not wish to delay the Committee, but this does seem to me a very important Amendment. The noble Baroness said something that struck a bell: the statement she made that stamp companies often, if not always, put on their stamps and their books that the stamp collector has no rights whatsoever, that the stamps and the books remain the property of the stamp company. When I say it struck a bell, I remember reading out last December the fact that the stamp collector, at least with one organisation, had only one right and that was to stick the stamps in the book; that was the only right that the stamp collector had. 1 remember the Lord Chancellor was not quite sure whether the stamp collector had even that right. But I notice that subsection (5) of Clause 3, which is dealing with redemption of trading stamps for cash, says:
"Any agreement under which the rights conferred by this section on holders of redeemable trading stamps are surrendered or modified shall be void."
It would seem to me, so far as redeeming these stamps for cash is concerned, that such provisions of the stamp company would appear to be void. Perhaps we could devise some way of making sure that subsection (5) applied not only to cash redemption but also to the goods.
What we are really trying to establish is the right of the stamp collector on the stamp trader. I can see the noble Viscount's difficulty with regard to changing values of stamps or where goods have gone out of production. I appreciate the difficulty, but there is undoubtedly a case that the stamp company is making an offer to the public by their catalogue; they may have covered themselves by adding, as many traders do, "subject to being unsold" or "subject to being available"; but even if those provisos are added to an offer, my understanding in trade is that you are nevertheless accepting a responsibility that you will provide something of equal worth, of equal value. If we could somehow get this relationship of the stamp collector with the stamp company regarding the goods that are being offered through the stamp book, I think we could go a good deal of the way to meet the noble Baroness.
VISCOUNT COLVILLE OF CULROSS: May I briefly answer the noble Lord? Any assistance he can give will, of course, be extremely welcome. But there is this difference between the analogy he has put and the present circumstances. If a trader says, "You can have it subject to its being available", the person to whom he says that is fully entitled to have it and fully capable of having it immediately if he pays. But when a stamp collector begins filling his book he has not got enough stamps for the article, and it would be quite unjust to create a contract at that stage to provide some article later on when he has got the stamps.
LORD AIREDALE: Without an Amendment of this kind, what is there to prevent an unscrupulous stamp-trading promoter, in competition with his rivals, from publishing a glossy catalogue setting out a thousand and one delectable so-called gifts, and the stamp collector, when she has eventually collected the stamps for the gift she wants out of the catalogue, arriving at the gift hall to find there are not a thousand arid one delectable things but about a hundred arid one, and the thing she wanted was one of the other 900, and in fact there is practically nothing there that she wants at all? If that situation occurs when you are shopping in the ordinary way—you go to the shop and you find they have sold out of practically everything—you are not in much difficulty because you go somewhere else and get what you want. In this case the lady is landed with a large number of trading stamps, there is nothing she wants to redeem, and all she can fall back upon is cash redemption. I am sorry to say this again, but Parliament has not yet in this Bill secured that the cash redemption value is going to be a reasonable one.
LORD DRUMALBYN: Perhaps it might help the Committee if I were to say a word about the last point in this Amendment, and that is the question of deeming stamp transactions to be a contract of sale when it is not. This, as my noble friend has said, is not a very easy matter to provide for in itself, and I am sure my noble friend Lady Elliot of Harwood would not be surprised to hear this would probably not stand as it is in this way; you would
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probably have to go on and deem the promoter to be the seller and deem the holder to be the buyer and probably deem the trading stamps to be the price. These are obvious difficulties, but I think the main one is the question of waiver. I am not quite sure whether my noble friend appreciated it when she moved it. If this was really going to be any use to the stamp holder it would be necessary to provide that it should not be possible to contract out of the Sale of Goods Act. So first of all you have to deem there to be a contract of sale, when there is not, and then you have to prevent contracting out of provisions relating to it, as if it were a contract of sale; that is not a very easy proposition.
My noble friend Lord Colville of Culross was quite right in saying this was a matter on which the Molony Committee commented, and it recommended that freedom to contract out of the Sale of Goods Act should be severely limited. There is always difficulty, as the Committee well knows, in anticipating the consideration of a whole subject of this kind, and I think in all tile circumstances the Committee will see how particularly difficult it would be in this case, because you not only have got to prevent contracting out of the Act but you have to deem this to be a sale when in fact it is not. There is a duality here, and I think it would probably be almost the most difficult point to legislate on in advance of the consideration of the Merchandise Marks Act and the Sale of Goods Act, which are at present being considered by the Government. I would doubt whether it would be possible for us to include anything of this character in the present Bill. But I congratulate my noble friend on drawing attention to this difficulty, which I am sure is one we shall have to solve in the long run.
LORD SHACKLETON: Before the noble Baroness withdraws the Amendment, if she is going to, may I say that I do not think the noble Lord, Lord Drumalbyn, gave a quite definite assurance that this would be considered when the further legislation is taken into account—or did I misunderstand? Because this would obviously go a long way to meet the point. What one would not want to find is the position in which

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the Government, whichever Government it may be, would say, "We cannot really deal with trading stamps in this other type of legislation. It is very difficult because we have already passed a certain Act of Parliament."
LORD DRUMALBYN: I am sure that that will not happen. What we cannot do, of course, is to anticipate the consideration that will be given. We have to consider it, but I do not know what difficulties will be encountered in the way; and it would be wrong for me to promise the solution of this difficulty. I can give the assurance that it will be considered in connection with the consideration of the Sale of Goods Act as a whole.
8.10 p.m.
BARONESS ELLIOT OF HARWOOD: I am more and more interested in this debate, because it seems to me that I am thinking all the time ahead about new pieces of legislation, new types of trading and new series of companies and everything else; and every time anybody replies they say that something cannot be done because it has never been done before. That may well be. The fact is that we are now about to pass legislation which has never been passed before, and if we are to give the people we are discussing, whether company promoters, stamp traders or consumers, the kind of protection which we normally provide in legislation which has been passed, we have to look to the future. I am glad that the noble Lord, Lord Shackleton, drew the attention of my noble friend the Minister to this fact.
In regard to subsection (8) of my Amendment, I agree that in existing circumstances and under the existing Sale of Goods Act, or any other Acts that cover this sort of thing, it is necessary to put something in the picture. As we all know, these Acts are under review —the Merchandise Marks Act is being reviewed, and I daresay the same is true of the Sate of Goods Act. I beg the Board of Trade to realise that these things are happening, and that it is no good coming to me, as Chairman of the Consumer Council, in two years' time, when I have masses of complaints about this matter. It must be done at the time when these things are happening.
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I would beg the Minister to do this. It really is no good legislating now and then saying that, because it is new, it cannot be fitted into any other of the protective measures which have been built up over the years, and which I am sure everybody is anxious should continue when new measures of protection are being started.
LORD DRUMALBYN: If my noble friend will forgive me, it is not just a question of fitting this into existing legislation. If that were so, it would not be so difficult. What she is asking us to do is to alter the existing legislation in order to fit this Bill in in a particular way, and in a most difficult way. That is not quite the same as fitting it into existing legislation.
LORD SHEPHERD: Where there's a will, there's a way!
LORD DRUMALBYN: No doubt it could be done; but what I am trying to say is that it is a mistake in principle to prejudice the general consideration of any situation by finding an ad hoc solution for one of the most difficult aspects of the general situation.
BARONESS ELLIOT OF HARWOOD: I agree that an ad hoc solution is no good. But we are at present in the process of a review of these Acts. Perhaps the question of fitting in this completely new aspect of trade could be put into that review. I am asking that the Government should consider it, so that when the review is complete we shall not have to come to the Board of Trade in a year or two, asking, "Will you please include stamp trading under these Acts?". It can be done when the whole thing is under review.
It may be that the drafting of my Amendment leaves loopholes. It was never my intention to suggest that anybody could earn a few stamps by purchasing goods and then ask for a Rolls-Royce. That is ridiculous, and I would never suggest that. What I say is that if a person has a book of stamps, or two books of stamps, or a hundred books of stamps, however many he has, those stamps should be recognised as his property, and he should be able to exchange them for goods. Of course the good companies will do it —I am not saying that a big trading stamp company will not honour its

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obligations. If everything went right in life we should never require any legislation at all; it is because things go wrong that we require legislation.
I am not speaking of the good companies, who will of course meet their obligations when a stamp trading person comes in and says "I want my electric kettle" or "I want my scooter. Here are my stamps." They will be only too delighted; they will provide whatever is asked for. I am concerned with the people who do not do that—those who have written in tiny letters on the stamp book "This is still the property of the company." This, I think, is quite wrong, and people should not he allowed to do it. Not all companies do this, although some of them do. But if I have been given trading stamps, and have my book in my house, having collected enough stamps to obtain an article, then the book belongs to me and the stamps are my own—I have earned them by my purchases.
I ask the noble Viscount not to brush this aside as though it were not something which is there to protect the consumer. Although my Amendment may not be rightly phrased, something of this kind is clearly required for this new (and I emphasise "new") type of trading which is only just starting in this country on any big scale. It is the thing we are legislating for now. I think that the noble Viscount should consider whether or not all the points that I have made in the interests of the consumer are being covered-because I am told that at the moment they are not. If any other kind of dealings were involved there would be Acts of Parliament covering them. As a matter of fact there are not. This Bill is in process of being passed, and it is one that should look ahead to future problems and difficulties.
The last thing the noble Viscount made great point with was the possibility that I, as a collector of stamps, having set my heart on getting a particular article, may find, when I go to the redemption centre, that the particular article is not there. Again, I consider that is a possibility about which the consumer should be warned. She should be told that the article in question is in short supply, or should be given some indication that it will not be available. If the consumer
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wants to collect for an object I think it should be an obligation on the company to try to supply that object. That should be written into the Bill.
It is not a question of supplying an article for which the customer has not enough stamps; nor a question of the customer asking for a Rolls-Royce when she is collecting only for an electric kettle. All I am saying is that when she has collected what appears to be the correct number of stamps for a given article, there is an obligation on the company to have that article in stock; or, if they have not got it in stock, to have a good reason why, and possibly to offer something equivalent, although it may not be exactly the same.
LORD AIREDALE: Such as cash. The equivalent value for the article which is out of stock—cash.
BARONESS ELLIOT OF HARWOOD: The difficulty about cash is that the Committee have rejected my attempts to try and get a fair cash value. If we could find some formula that would give a fair cash value to both sides, then I should be perfectly willing to agree that the customer should get cash. But I was thinking in terms not of cash, but of kinds of articles for which someone is collecting and which she has set her heart on getting. It may he that in this matter the stamp companies have the advantage over the big stores. We all know that my noble friend is connected with one of the big stores in London which will do anything to try to get its customers the goods they want. The same obligations should apply to those people.
LORD McCORQUODALE OF NEWTON: How many times during her life has the noble Lady written off to a shop, even to a most respectable store, and been told, "It is out of stock"? Oh, come off it!
BARONESS ELLIOT OF HARWOOD: I have been very fortunate. I seldom ask for something that is out of stock. In fact, if I do, I notice that the shop concerned does it very best in trying to obtain it. I am asking that the stamp company should bear the same relationship to their customers as the shop bears to its customers, and that they should do their best for them. If the terms of the Amendment I am moving do not exactly

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fulfil this, I am not going to press it, but I think that in this new Bill, with its new ideas and new methods, the noble Viscount will be concerned to see that the rights of the customer are safeguarded, as they are in all kinds of trading.
VISCOUNT COLVILLE OF CULROSS: The noble Lady must not say that I am brushing these matters aside. The trouble is to find out how one can do it. I have gone through the noble Lady's Amendment, my opinion is that it does not work, and I am unable to think of anything else that does. If the noble Lady has further suggestions, I shall be glad to look at them.
LORD SHEPHERD: I must congratulate the noble Lady on the impassioned speech which she made. We felt our hearts warming towards her, for we feel that where there's a will there's a way, as the noble Lord the Minister knows. This is an important Amendment, and the Committee is extremely thin. I wonder whether the noble Viscount would move that the debate on this Amendment be adjourned. This is important. I think we ought to have some time to consider this matter, and no doubt there will be others who will wish to say something on it. I hope that the noble Viscount will respond on this, because I do not feel that this important Amendment should be dealt with this evening with such a thin Committee. If I may say so, we are somewhat beyond the time that was agreed, through the usual channels, for the Adjournment.
LORD DRUMALBYN: I would agree with that entirely, but the course of the debate has shown quite clearly that, although more might be said on it, we should not get any further with it. I wonder whether, in fact, it might not be preferable, if anybody has new ideas or wants to raise this again on Report stage, to consider it then. I am sure that it has been shown clearly that the actual terms of this Amendment could not be accepted in any case. While part of it might be further considered—certainly one part, as I have made clear—I am afraid that it would not be possible for the Government to accept this Amendment. So that I hope it is acceptable to the noble Lord, Lord Shepherd, that we should at least clear this Amend-
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ment, and I had hoped that there would not be much debate on the rest. But, of course, we are entirely in the hands of your Lordships in this matter, and if there were other matters your Lordships wished to debate on the remaining Amendments I agree that the best course would be, with the agreement of my noble friend, to adjourn at this stage. However, I hope that, in view of the fairly full debate that has taken place on this particular Amendment, we shall be able to dispose of it.
LORD SHEPHERD: I thank the Minister, and would be happy to respond; but, as I have said, this is an important Amendment and there is a relatively thin Committee. We may feel that we should wish to take a stand on this Amendment. We are in some difficulty, and we know the consequences if we were to take that stand. I should not want to be put in that position this evening. I have not consulted my noble friend Lord Shackleton, who is taking the Bill for our side, but we should like some further time on this Amendment, and will need a good deal more time on the remaining stages of the Bill.
VISCOUNT COLVILLE OF CULROSS: Does the noble Lord mean the remaining stages or this stage?
LORD SHEPHERD: The remaining Amendments on this stage. Then perhaps we can cut short the other stages of the Bill. Like the noble Viscount, we should like to see the Bill go through.
LORD DRUMALBYN: We have had such an excellent speech from the noble Lady (which I must say I regarded as a closing speech, as I am sure she intended it to be) that I should have thought it preferable to reach a conclusion on this Amendment on this occasion. I was hoping that my noble friend Lady Elliot of Harwood would be prepared to withdraw her Amendment at this stage and then, if that were done, we could carry on with the remainder of the Committee stage on a future occasion.
BARONESS ELLIOT OF HARWOOD: I am perfectly willing to do that to enable the Opposition to back me on this, because I feel strongly about it. It is late; I have had my say. I will withdraw the Amendment as it stands, but shall try to see whether I cannot get

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an Amendment on Report stage which will receive the support of the noble Viscount to put in these points so as to safeguard the consumer. I beg leave to withdraw the Amendment.
THE DEPUTY CHAIRMAN OF COMMITTEES (LORD STRANG): Is it your Lordships' pleasure that the Amendment be withdrawn?
SEVERAL NOBLE LORDS: No.

CONTENTS

Airedale, L. [Teller.]

Shackleton, L.

Shepherd, L. [Teller.]

Lindgren, L.

NOT-CONTENTS

Colville of Culross, V. [Teller.]

Elliot of Harwood, B.

McCorquodale of Newton, L.

Drumalbyn, L.

Ferrers, E.

Redesdale, L. [Teller.]

THE DEPUTY CHAIRMAN OF COMMITTEES: As it appears that fewer than thirty noble Lords have voted, in accordance with Standing Order No. 50 I declare the Question not decided; and, pursuant to the Standing Order, the House will now resume.
House resumed.