HL Deb 27 May 1965 vol 266 cc958-63

3.10 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.—(Lord Snow.)

On Question, Motion agreed to.

House in Committee accordingly.

[The LORD MERTHYR in the Chair]

Clause 1 [Exchequer advances to Corporation]:

On Question, Whether Clause 1 shall stand part of the Bill?

LORD DRUMALBYN

I should like to put a question or two to the noble Lord, Lord Snow, because when we dealt with this Bill on Second Reading we dealt with it, through mutual agreement, rather summarily, and I did not put the questions that I had in mind. In considering Clause 1, I think it is important that we should have an assurance from the noble Lord that the information that we include in the future regarding the activities of the National Research and Development Corporation should not be less than in the past. Among other things, this clause provides that a copy of the annual statement of accounts shall be sent to the Comptroller and Auditor General. I presume, therefore, that the Comptroller and Auditor General will examine this in the usual way, and his reply will then go to the Public Accounts Committee, where it will be considered, and no doubt another place will report on the matter in due course. But I would ask the noble Lord whether the amount of financial information that is given in what is called the annual report and statement of accounts will not be diminished in consequence of this further step, and whether the same information will be given to the House as in the past.

I am sure he will agree that a good deal of the recent success of the National Research and Development Corporation has been due to the fact that its activities have been getting much better known, and therefore many more people have been prepared to take their inventions to the National Research and Development Corporation than before; and the fact that the reports have been gaining considerably in circulation has had a considerable part to play in this. Of course, the statement of accounts that is referred to here gives a fairly clear idea of the form that its activities take and the way in which it can help. I would ask the noble Lord whether he can give me the assurance for which I ask.

THE PARLIAMENTARY SECRETARY, MINISTRY OF TECHNOLOGY (LORD SNOW)

I can give the noble Lord the assurance he asks for. In fact, I can go a little further. We are now trying to devise a new form of accounts in consultation with the Corporation, its professional auditors and the Treasury, which we hope will be even more illuminating than the accounts have been in the past.

LORD DRUMALBYN

I am much obliged to the noble Lord.

Clause 1 agreed to.

Clause 2 agreed to.

Clause 3 [Exchequer payments to meet interest due from corporation]:

On Question, Whether Clause 3 shall stand part of the Bill?

LORD DRUMALBYN

This is a clause which has to do with Exchequer payments under interest due from the Corporation. I should like to ask the noble Lord this question. The clause makes it possible for the Minister to give relief in respect of interest due under Section 8(1)(b) of the principal Act in respect of any advance, being interest in respect of the whole or any part of the period of eight years beginning with the making of the advance. The period of eight years is, I understand, taken because that is considered to be roughly the average period that it takes for developments to come to fruition or at any rate to get to the stage when they can be made available to industry for further development and exploitation. It seems to me that there is a technical point here, and I should like to be quite certain that it is fully covered by this clause. If one looks at the accounts one finds that the total of advances over the period of years is slightly less than the total of development expenditure. One reason for this practice is that there is a certain amount of revenue coming in through royalties, the sale of patent rights, the hire of computers and the like. But apart from that, it would seem to be common sense that the amount, or the amounts, of advances that are made are related to the day-to-day needs of the Corporation and are not tied to particular projects.

Over the period of the development of a project, advances will no doubt be made by the Minister on several occasions. What I want to be quite certain of is that the machinery here is right, and that the words used are right. I should have thought that it is expenditure in relation to the development rather than the advances that ought to be relieved of interest. Technically, this might be the correct description. From the point of view of the mechanics of the operation, how it goes on, it does not seem to be quite right. As I say, the advances are made en bloc in accordance with the general development needs of the Corporation. They are not directly related to particular projects. Indeed, it would be quite impossible to say, "You can have so much in advance in order to start such-and-such a project", even if the Minister had to be consulted about projects, which is not the case, either. Therefore, it seems to me that this is an odd form of words to use. Of course, one would not quarrel about it in any way if it does the job; but I thought it right to draw the noble Lord's attention to the point, and I should like his assurance either that it does the job, or that an alteration will be made before the next stage to ensure that it does.

LORD LEATHERLAND

May I put what is perhaps a rather trifling question? This House has been much concerned of late with retrospective legislation, and the morality or immorality of such legislation. I see here from subsection (3) that this relief will apply in relation to advances made before or after the passing of the Act. Therefore, is this not retrospective legislation, and should it not incur denunciation by some noble Lords opposite?

LORD SNOW

I think the intervention of my noble friend is rather beyond my control. On the point raised by the noble Lord, Lord Drumalbyn, again I am happy to give him the complete assurance for which he has asked. His understanding of at least the intention of the clause is absolutely what was in the minds of those who drafted the Bill. May I try to make it crystal clear?—although the noble Lord has forgotten more about these matters than I have ever known. Advances fall into two groups. There are, first, those which are used for the actual day-to-day carrying on of the Corporation, and, secondly, those for projects, but projects considered totally and not individually. It would be entirely unrealistic to try to give individual advances for individual projects, as the noble Lord has said. On the other hand, at the end of each year one can decide into which group advances fall, which advances have been used for the day-to-day running and which for total investments in projects. It is the second group which is going to be allowed interest relief.

LORD DRUMALBYN

May I ask the noble Lord one further question? While it is perfectly right and proper, when one is considering advances globally, to take an average figure for the time the development may take place, surely when one is considering again individual advances one ought to relate those again to the individual projects. If an individual project takes much more than the average why should it not be possible to give a relief of interest for the longer period? This clause is not designed to even out the shorter periods and the longer periods, because the advances are to be related to the individual projects in each case. It means that if an individual project takes longer than the average it is going to be, as it were, penalised in comparison with an individual project that takes less than the average. May I ask what is the reason for taking the average period, rather than simply saying in appropriate cases: "Interest will be waived in relation to the time that the project takes to develop"? I should have thought that this was the more rational procedure, rather than that one should take an average time and say that that should be the maximum.

LORD SNOW

This is what a mathematician would call integral DX. We felt, on the whole, that smoothing out the investment in projects like this was the most economical method of accounting. I agree that it could have been done in another way, but after a good deal of consideration this seemed to us to be the most sensible system. The differences are really not very large.

Clause 3 agreed to.

Remaining clauses and Schedule agreed to.

House resumed: Bill reported without amendment.

LORD STRANGE

I just have one word to say—

SEVERAL NOBLE LORDS

Order! Order!

LORD SNOW

My Lords, I beg to move that this Report be now received.

Moved, That the Report be now received.—(Lord Snow.)

LORD STRANGE

My Lords, I am sorry that I was out of Order. I have one very small thing to say. I spoke on the Second Reading of the Bill on behalf of the inventors, and I have since had a number of letters from inventors. The noble Lord, Lord Snow, was very sympathetic towards them and they mention the fact that I called them "cranks". It is not so much the word "cranks" that they mind, but (to use an expression that we have in the Isle of Man) they do not like to he thought "not the hat". They wanted me to explain it in a few words.

I have tramped your Lordships' Turkey carpet in the Library trying to think of the simplest example I can give you to show their point of view. I should like to put the matter right by saying this. Between the wars persons like Professor Low, in this country. Herr Opel, in Germany, Mr. Goddard, in America, and many other inventors, were producing moon rockets. I think that the Governments were not interested in those rockets for the purpose of putting up a satellite or going to the moon. Some of them were interested in them as weapons of war or for mechanical propulsion. When the Russians actually put up a satellite the general public were rather amazed, for they did not think that the Russians were the sort of people to do that sort of thing. They thought they were charming people at ballet and circuses and cut nice things with pocket knives out of wood. An American comedian said that both America and Russia have German technicians for rockets, but the Russians had the best. This was not exactly correct, because the film of Stalingrad in 1943 showed that the Russians were far in advance with their rockets, In fact in 1935 they had put up a rocket to six miles.

Your Lordships know that rockets were invented by the Chinese—and gunpowder, too—thousands of years ago; but the first stages of astronautical development came from the Russians in the last century. At that time it was considered impossible by everybody. Schoolboys reading the Eighth Book of Ovid,I think it is, would have thought that the astronautical adventures described there were impossible and just bunkum. Even science fiction writers were cagey about bringing in anything to do with rockets for their aerial flights. They invented a sort of anti-gravitational paint for their weapons. The whole public thought that it was impossible and that the idea was incredible. Yet for seventy years the Russians persevered. I think they got so far ahead before the last war that they had actually got some form of toleroid with instruments on their retro-rockets. The point I am trying to make is that, though the general public think that inventors are cranks or "not the hat", the inventors believe that they have the vision. What the general public believe at the time to be impossible they believe can be attained.

On Question, Motion agreed to: Report received accordingly.