SOLUS PETROL (No. 2) ORDER 1966 (Hansard, 16 November 1966)

§ LORD SHEPHERD
My Lords, on behalf of my noble friend Lord Rhodes, who is out of the country on Board of Trade business, I beg to move the Motion standing in his name on the Order Paper. The House of Lords Select Committee, which was established to consider the petition by Total Oil Products (Great Britain) Limited against the Solus Petrol (No. 2) Order, reported on November 14 in the terms that are on the Paper before the House. Following the announcement of this judgment, representatives of Total told the Board of Trade that, in these circumstances, they would now like to offer the President of the Board of Trade identical undertakings to those already supplied by the 41 other companies, which represent 98 per cent. of the petrol trade. The President of the Board of Trade has accepted this offer.
It means that Total will now be in the same position as all the other companies and will receive the benefit of the "one-for-one" and "across the road" concessions. The Government are happy about this event, because they believe that, where possible, they should obtain voluntary agreementsas opposed to the use of Orders. The President of the Board of Trade is prepared to accede to the Select Committee's suggestion that there should be a review within a period of twelve months of the formula contained in Article 11 of the present Order. This review will in fact be of the whole complex of undertakings, since the formula does not stand alone but is integrally linked with all the other provisions of the scheme. Therefore, the Order that was before the Select Committee will now lapse, because the Government will not ask the House to approve it.
While conscious of the important debate that is to follow, I would detain the House, if I may, to draw your Lordships' attention to the difficulties that could have arisen in regard to the procedure on Standing Order No. 216 in relation to Orders made under the 1261 Monopolies and Mergers Act. On July 15, 1965, your Lordships considered the Report and recommendations of the Procedure Committee in regard to Standing Order No. 216. It is true that acceptance of the recommendations would not necessarily have eased the problem that has arisen over this Order, but they were rejected by your Lordships' House on a Division. Even those who opposed the Report and recommendations of the Procedure Committee admitted considerable concern about the procedure and difficulties that face the House. Orders that can be made under the Local Government Act, 1958 come into operation only when the Order has been approved by both Houses of Parliament, but this Order and other Orders that can be made under the Monopolies and Mergers Act come into operation immediately and then lapse unless both Houses approve them within 28 days.
Let me give sonic details of the timing on this Order to illustrate our difficulties. I ask the House to accept that this Order has been dealt with as expeditiously as possible, because before it was presented there had been another Order in identical terms, but the House and the authorities who were concerned in the arrangements knew that a petition was going to be made against it. Therefore, this Order had the best possible opportunity of being passed within 28 days.
The Order was laid on the Table on October 20, 1966. Therefore it would lapse to-day, November 16, at the end of the 28 days. The Special Orders Committee are required to judge whether an Order is hybrid. In most cases this has to be retrospective, in that, as I have already said, at least the 14 days' petitioning period operates from the date when the Order is laid in this House. The Special Orders Committee judged this Order to be hybrid.
At the end of 14 days the Special Orders Committee were required to meet, and they had to listen to counsel, both for the promoters and for the petitioners. In some cases this could be done in one meeting, but on a major issue such presentation of the facts and discussion might take two or three days. Therefore, it is unlikely within our time scale of 28 days that the Special Orders Committee could report to your Lordships' House before 1262 the 15th or 16th day. In this particular case, we were able to appoint a Committee on November 8. This was because we had prior knowledge of this petition. In appointing a Select Committee, one needs in most cases to give Members at least two weeks' notice. Perhaps I may here pay a tribute to those noble Lords who give great service on our Select Committee, an important part of our work undertaken by relatively few noble Lords.
This Committee was set up on November 8. Because of prior knowledge the members of the Committee were able to sit the following day, November 9, and they sat from 11 o'clock until 4.30 in the afternoon. They sat again on the 10th, from 10.30 to 4.30, and again on November 11 (and I would remind your Lordships that November 11 was a Friday) from 10.30 to 6.30. The Committee concluded their business on November 14. This was two days before the Order would lapse, and as your Lordships will appreciate, the House cannot be asked to approve an Order until the Select Committee have reported.
First of all, the Report was not available to Members of this House until the morning of the 15th, that is, the day prior to the consideration by this House of the Report, and the House being asked to approve the Order. In fact, it was not until the 15th that to-day's Business could be entered on to our Order Paper. I do not believe, as this was a major and important Order, that there was sufficient time for the House to have proper notification and for those who are interested to be present and to prepare their case.
There is one other aspect on this matter of the timetable, and that is the time that is available, not only to the petitioners but to the promoters to give evidence. If one looks at the transcripts of this particular Select Committee, counsel for the promoter was challenged why he did not bring certain evidence before the Select Committee, and his reply was that if he had to do so the timetable would be placed in jeopardy. In other words, he had to be careful what time he used for the presentation of the promoter's case. I do not think this in itself is a satisfactory position. But if this Order were to lapse because the Select Committee had not reported, it would be necessary to lay a new Order, and, as I understand it, the procedure that I have 1263 just described would have to recommence because it would be a new Order. There would have to be a further 14 days for petitioning, and you would have to set up your Committee for further examination.
I do not this afternoon suggest how this should be dealt with, but I hope that the House, having in mind Standing Order No. 216 affecting as it does other legislation, and particularly as it will affect this type of Order which needs to be passed by both Houses of Parliament within 28 days, will share my view that this is a matter that should be referred to the Procedure Committee, and that the Procedure Committee should report on it as soon as possible.
Noble Lords may say that this could perhaps have been arranged behind the scenes, and one could have arranged with the Procedure Committee for this to be adopted. Of course, the Government are particularly involved here, and my noble friend the Leader of the House and I take that view that it would be wrong for the Government to take this action except in the open on a matter in which private rights are involved. Therefore, this has been an opportunity to ask the House whether they will agree to this matter and all matters affected by our standing Order No. 216 being referred to the Procedure Committee. My Lords, I beg to move.

§ LORD DRUMALBYN
My Lords, we on this side of the House are grateful to the noble Lord for having gone into the difficulties that arise from the circumstances of this Order. It might not be wrong for me to paint the lily a little by saying that, had Total complied with the time schedule when the Order was first laid, the situation would have been more difficult still. Indeed, it would have been made virtually impossible, because the days that remained between the time in which to petition ran out and the time when the draft Order would have expired was very short indeed, whereas the fact that it had to be relaid made the time a good deal longer. So this is an acute difficulty, and we 1264 would not in any way disagree with what the noble Lord said about the need to refer it to the Procedure Committee.
May I make one point on this occurrence—shall I put it?—as a whole. As it turned out, one of the major difficulties throughout was that the Order was in different terms from the voluntary agreement. I suggest that we should learn one lesson from this (and I would submit that the Government perhaps could learn this lesson),that is, they should make quite certain, when they are framing the terms of voluntary agreements to be submitted to firms to adhere to, that they are capable of being transposed into an Order if there is disagreement by one or more firms, and it so happens that an order has to be imposed upon them while the rest of the firms agree to the voluntary side. This is important, and for this reason. It is difficult to maintain that there is voluntary agreement if the alternative is a more stringent Order. This becomes a kind of blackmail for signing the voluntary agreement. I hope that this point will be borne in mind, because this was the crux of Total's petition, and I think it is likely to arise in many cases in the future unless this lesson is learned from this particular instance.

§ LORD SHEPHERD
My Lords, I am most grateful for what the noble Lord, Lord Drumalbyn, has said, and particularly that he concurs. I hope he concurs on behalf of his noble friends that the points I have made should go to the Procedure Committee.
I think I should rebut one point he made (I am not sure whether he really intended it to be an accusation): that the Board of Trade had produced a more stringent Order in order to blackmail Total to agreeing to the undertaking. This was not the case. As I understand it, the problem was one of drafting to provide the formula within a statutory Order. The difficulty of bringing this into line, or bringing Orders into line, with the voluntary agreement, is that in most cases these agreements will arise from negotiations with a large number of organisations. In this case some forty-one companies are involved. Therefore, it is not always possible to get a voluntary agreement in such a way that it could be translated easily and clearly into a statutory Order. But I certainly 1265 take the point which the noble Lord has made.
I am glad that the petitioners in this case have decided to fall into line with their other colleagues in this trade, and I hope that those companies who may be involved in future inquiries by the Monopolies Commission will be able to follow the example of the petrol organisations in coming to voluntary agreements to save us making these unnecessary, or, at least, unfortunate, statutory Orders.

§ LORD MITCHISON
My Lords, may I ask one question? This is the Order under which some time ago the Procedure Committee made a recommendation to the House about certain Orders from the Ministry of Housing and Local Government. It was a suggestion that they should be exempted from the terms of this Order. The House decided against the recommendation of the Procedure Committee. Now that this Order is being reconsidered in another connection, will it be within the terms of reference to the Committee that they should return, if they so think fit, to the question of the Orders made by the Ministry of Housing and Local Government?

§ LORD DRUMALBYN
My Lords, before the noble Lord replies to that question, may I make it quite clear that I did not intend—and I think if he reads what I said he will agree—any implication whatsoever that there was any element of blackmail in this case. What I am saying is that there is a risk that it will be interpreted as blackmail if there is this difference. That, I think, is true. I am well aware that what happened was that the Board of Trade ran up against drafting difficulties in converting the voluntary agreements into an Order. All I am saying is that they should make certain that voluntary agreements are capable of being converted into an Order before they finalise the voluntary agreements.

§ LORD SHEPHERD
My Lords, I certainly withdraw the comment that I made. In reply to my noble friend Lord Mitchison, may I say that, because of the difficulties I put to the House, and the expression of the noble Lord, Lord Drumalbyn, I think that all points con- 1266 nected with Standing Order 216 should be considered urgently by the Procedure Committee. I beg leave to withdraw the Motion.