Lords Sitting of 23 April 1970

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

POST OFFICE TELEPHONE CHARGES
LORD KILMANY: 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 have received representations from the Telephone Users' Association regarding the proposed increase in telephone charges, and what action is being taken in the matter.]
LORD BOWLES: My Lords, my right honourable friend the Minister of Posts and Telecommunications received a letter from the Telephone Users' Association on April 11. He has suggested that any comments the Association may have on the proposed increase in telephone charges should be sent to the Post Office Users' National Council, which is the properly constituted body set up by Act of Parliament to represent users' interests, and I see from the Guardian of April 21 that they are going to see those people. Alternatively, the Telephone Users' Association may care to approach the Post Office direct.
LORD KILMANY: My Lords, arising out of that reply, may I ask the noble Lord whether he is aware that these increased telephone charges are going to hit old people of moderate means living in remote areas particularly hard? May I also ask what steps the Government, as opposed to the Post Office, intend to take to lessen the impact of these charges on those persons?
LORD BOWLES: My Lords, this is a matter for the Ministry of Health and Social Security. We have nothing to do with that; nor can we interfere with what
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the Post Office decides the charges should be.
LORD BLYTON: My Lords, is my noble friend aware that the profitable side of the Post Office is the telephone? Is he also aware that the Tory Party are all talking about handing this service over to private enterprise? Would not the charges be worse then?
LORD BOWLES: My Lords, if my noble friend would look at the position of the Bell Telephone Company in New York he will find that the directors—25 of them—have been prosecuted for mal-administration, and so on.
LORD FRASER OF LONSDALE: My Lords, may I ask the noble Lord whether he is aware that a number of poor per-sons and those who are disabled in the highest degree, including some blind people, may receive help towards the cost of a telephone under a Bill now passing through this House, and that the said persons are grateful to the promoters, the Government and Parliament for giving this consideration?
LORD BOWLES: I thank the noble Lord.
LORD DENHAM: My Lords, the noble Lord, Lord Bowles, said that the last supplementary question from behind me should have been addressed to the Ministry of Health and Social Security, but questions in this House are asked of Her Majesty's Government. Surely Her Majesty's Government have equal responsibility for the Ministry of Health and Social Security as they have for the Ministry of Posts and Telecommunications.
LORD BOWLES: My Lords, I have no responsibility for the Ministry of Health and Social Security here.
LORD DENHAM: My Lords, I think I am right in saying—and the noble Lord the Leader of the House will put me right if I am wrong—that questions in this House are asked not of an individual Minister but of Her Majesty's Government. Therefore, a question which possibly should have been addressed to somebody responsible for the Ministry of Health and Social Security can equally be answered by Her Majesty's Government in this House.
THE LORD PRIVY SEAL (LORD SHACKLETON): My Lords, I think the noble Lord is quite right in his statement that Ministers answer on behalf of the Government. There are some times when Ministers find that a supplementary question goes beyond the area in which he is particularly well informed.

STANSTED AIRPORT: TRAFFIC AND EQUIPMENT
LORD TREFGARNE LORD TREFGARNE had given Notice of his intention to ask Her Majesty's Government:
[The Question was as follows:
(i) How many air traffic movements are expected at Stansted Airport during the coming summer; (ii) What radar equipment will be available for use there during the same period.]
LORD BESWICK: My Lords, it is estimated that there will be about 32,000 air movements—that is, landings and take-offs—at Stansted Airport between April 1, and October 31 this year, of which 4,700 will be of public transport aircraft. The air traffic situation in the airspace around the airport, which is used mostly for training, has not so far been considered to warrant provision of radar control, and no radar equipment will be available for use there this summer.
EARL ST. ALDWYN: My Lords, on a point of order, I should like to ask the noble Lord the Leader of the House whether it is a new procedure that Questions are answered before they are asked.
LORD SHACKLETON: My Lords, my noble friend Lord Beswick is eager and enthusiastic at all times to inform the House. Perhaps he thought that the noble Lord, Lord Trefgarne, had asked the Question on Stansted Airport but that he had not heard him. But it was rather unusual.
LORD BESWICK: My Lords, if it be a sin to give information when it is not asked for, then I have committed that sin and I apologise. The voice of the noble Lord, Lord Trefgarne, on aviation matters rings out so regularly in my ears that I thought that I heard it when he was not here.

M.18 AND M.62: USE OF INDUSTRIAL WASTE
3.10 p.m.
LORD GARNSWORTHY: 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 consideration is being given to the removal of dereliction and the avoidance of further spoliation in the areas adjacent to road-work projects to be undertaken in the next three years on the M.18 and M.62 by using industry waste as "fill" material.]
THE PARLIAMENTARY UNDER-SECRETARY OF STATE FOR DEFENCE, R.A.F. (LORD WINTER-BOTTOM): My Lords, Her Majesty's Government fully appreciate the advantages of using suitable mineral waste as "fill" material for road-works. As regards the M.18 and M.62 projects, special investigations have been carried out, including tests on colliery tips in the vicinity of the works proposed. The results of these investigations will be made known to all contractors who are being invited to tender. The Government are also examining the overall social cost and utility of using mineral waste in this way.
LORD GARNSWORTHY: My Lords, may I thank my noble friend for that reply and ask him whether the Ministry of Transport are prepared to consider the advantage to local amenities—and I want to stress that aspect—of using this industrial waste on these projects? Further, are they aware of the possibility of financial savings by the avoidance of re-contouring, because if re-contouring is undertaken there is a charge on national funds by way of grant?
LORD WINTERBOTTOM: My Lords, at this moment the Ministry of Transport are not empowered to make these calculations. However, a Working Party is being set up jointly by the Ministry of Transport and the Ministry of Housing and Local Government to consider what further encouragement can be given to use waste as "fill" for road building; and, of course, they will be

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studying as a matter of urgency the complex technical and economic problems indicated by my noble friend.
LORD GARNSWORTHY: My Lords, may I further ask my noble friend whether it is correct that something like 20 million tons of "fill" material' will be required in connection with these projects? Is this not an area where waste heaps stand up like sore thumbs, and is there any part of the country which would benefit more by the removal of those heaps than this particular part?
LORD WINTERBOTTOM: My Lords, in fact the figure given me is 5·4 cubic million tons. As I said in my Answer, careful consideration is being given as to how tip materials in the area may be applied to this construction work.
LORD TAYLOR OF MANSFIELD: My Lords, would my noble friend say what is the position regarding the rating of colliery spoil heaps?
LORD WINTERBOTTOM: My Lords, I am afraid I cannot answer that question; but I will give my noble friend an answer—if he does not know it already.
LORD HAWKE: My Lords, would the noble Lord explain what he means by "cubic million tons"?
LORD WINTERBOTTOM: My Lords, I stand corrected. It is a cubic million metres.

OVERSEAS DIPLOMATIC ESTATES BOARD
LORD SHERFIELD: 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 have yet decided to establish an Overseas Diplomatic Estates Board, in accordance with the recommendations of the Review Committee on Overseas Representation.]
THE MINISTER OF STATE FOREIGN AND COMMONWEALTH OFFICE (LORD SHEPHERD): My Lords, no. Inter-departmental consultation is still continuing, but I hope that it will be possible to report a decision before very long.
LORD SHERFIELD: My Lords, arising from that reply, does the noble Lord recall that the Duncan Committee saw in this proposal one of the best means of avoiding waste and obtaining full value for money in our overseas representation? Therefore, does not the noble Lord agree that an early decision is desirable? Does he not further recall that in the debate on November 19 more than half the noble Lords who spoke did so in favour of the proposal and none spoke against? Will he therefore use this not inconsiderable consensus in duscussing this matter with those Departments which, unless things have changed very much in Whitehall since my time, will be opposed to this scheme?
LORD SHEPHERD: My Lords, I agree with the noble Lord that a decision should be taken at an early date. I am well aware of what the noble Lord said in the debate to which he referred when he, I thought, castigated his own late Department. He did so again to-day, and I hope that they will take note of these discussions.

EAST SUFFOLK COUNTY COUNCIL BILL [H.L.]
Read 3a, and passed, and sent to the Commons.
NOTTINGHAMSHIRE COUNTY COUNCIL BILL [H.L.]
Read 3a, and passed, and sent to the Commons.
PRESTON CORPORATION BILL [H.L.]
Read 3a, and passed, and sent to the Commons.

TELEVISION (ADVERTISEMENTS) BILL [H.L.]
LORD SORENSEN: My Lords, I beg leave to introduce a Bill to prohibit advertisements on television that induce the smoking or purchase of cigarettes or the consumption or purchase of intoxicating liquor. I beg to move that this Bill be read a first time.
Moved, That the Bill be now read la. —(Lord Sorensen.)
On Question, Bill read la, and to be printed.

COMMONWEALTH COUNTRIES AND REPUBLIC OF IRELAND (IMMUNITIES) ORDER 1970
3.17 p.m.
LORD SHEPHERD: My Lords, with permission, in moving the first Order I will speak also to the second. Neither of these Orders provides for any extension of immunities; they provide merely that certain countries which have become independent countries within the Commonwealth, may have their names added to those of the other countries who enjoy these particular immunities and privileges. I hope that in these circumstances the House will agree to approve these two Orders. I beg to move.
Moved, That the Draft Commonwealth Countries and Republic of Ireland (Immunities) Order 1970, laid before the House on 9th April, 1970, be approved.— (Lord Shepherd.)
THE EARL OF BESSBOROUGH: My Lords, I thank the noble Lord for bring-nig these Orders forward. I should like to make just one or two remarks. I gather that these Orders are consequential on the achievement of independence by the island of Nauru, in the Pacific, and also by Swaziland and Mauritius. We welcome the independence of these countries and therefore welcome the Orders, but I understand that all these countries became independent in 1968. I should therefore like to ask the noble Lord (I am sorry I could not give him notice) what the position has been about diplomatic immunity between then and now for representatives of these countries. Should not these Orders have been made at the time of independence? Why does the first Order, for example, the Commonwealth Countries and Republic of Ireland (Immunities) Order 1970, apply to only Nauru, in the Pacific, which as we know has a population of some 6,000? Has not a similar Order been made for Mauritius and Swaziland, and, if so, why was Nauru not included in that Order? While welcoming these Orders in principle, I should be grateful for an answer from the noble Lord on those points.
LORD SHEPHERD: My Lords, I did not quite appreciate that the "cricket season" had commenced. This is one of
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those "fast overs" and I fear that I can-not give the noble Earl an explanation on the first question that he put. But my understanding is that the reason the other countries are not in the first Order is that the Act has already been applied to them; but I will certainly look into the matter and write to the noble Earl. I apologise. I have a good deal of information, but that particular aspect was not covered.
THE MARQUESS OF WILLINGDON: My Lords, would not the Minister agree that these countries have not previously had diplomatic representatives here and have just applied for them now?
LORD SHEPHERD: No, my Lords, the diplomatic representatives of Mauritius and Swaziland have been in London for some time. I gather that diplomatic immunities have been given to them because of their status as High Commissioners here, but this Order is to regularise the position of dual nationals.
On Question, Motion agreed to.

DIPLOMATIC PRIVILEGES (CITIZENS OF THE UNITED KINGDOM AND COLONIES) (AMENDMENT) ORDER 1970.
LORD SHEPHERD: My Lords, I beg to move that this Order be approved.
Moved, That the Draft Diplomatic Privileges (Citizens of the United Kingdom and Colonies) (Amendment) Order 1970, laid before the House on 9th April, 1970, be approved.—(Lord Shepherd.)
On Question, Motion agreed to.

ROADS (SCOTLAND) BILL
3.21 p.m.
LORD BESWICK: My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Roads (Scotland) Bill, has consented to place her interest, so far as it is concerned on behalf of the Crown, at the disposal of Parliament for the purposes of the Bill.
THE MINISTER OF STATE, SCOTTISH OFFICE (LORD HUGHES): My Lords, I beg to move that the Bill be now read a third time.
Moved, That the Bill be now read 3a. —(Lord Hughes.)
On Question, Bill read 3a, with the Amendments, and passed, and returned to the Commons.

BUILDING (SCOTLAND) BILL
LORD HUGHES: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Hughes.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD MERTHYR in the Chair.]
Clauses 1 to 4 agreed to.
Clause 5 [Amendment of s.8 of Building in (Scotland) Act 1959]:
LORD HUGHES LORD HUGHES moved Amendment No. 1.
Page 9, leave out lines 32 to 43 and insert— (" subsections—
"(4) If at any time any portion of a road is occupied for the purpose of depositing materials or otherwise in connection with operations for the construction, repair, maintenance or demolition of any building without a permission granted under this section or other-wise than in accordance with a permission so granted (including the conditions, if any, to which the permission is subject), or if such occupation is continued beyond the period for which the permission was granted, the person conducting the operations shall be guilty of an offence against this Act.
(5) If at any time any portion of a road is occupied for the purpose of depositing materials in connection with such operations as are mentioned in subsection (4) above without a permission granted as aforesaid, or otherwise than in accordance with a permission so granted (including the conditions, if any, to which the permission is subject) any person, other than the person conducting the operations, who, either by himself or by his servant or agent, deposits materials on that portion of the road in connection with the operations, shall be guilty of an offence against this Act.
(6) Where the person conducting the operations is charged with an offence under subsection (4) above it shall be a defence for him to prove that he took all reasonable precautions and exercised all due diligence to avoid the commission of the offence.
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(7) Where any person is charged with an offence under subsection (5) above, it shall be a defence for him to prove that the offence—

(a) took place on the instructions, or by the authority, of his employer or of the per-son conducting the operations, or

(b) was due to a mistake, or

(c) was due to reliance on information supplied to him,

and that he was unaware that he was depositing the materials otherwise than under and in accordance with a permission granted under this section.
(8) If in any case the defence provided by subsection (7) above involves the allegation that the offence took place on the instructions, or by the authority, of another person, or was due to reliance on information supplied by another person, the person charged shall not, without leave of the court, be entitled to reply on that defence unless, within a period ending seven clear days before the hearing, he has served on the prosecutor a notice in writing giving such information identifying or assisting in the identificaton of that other person as was then in his possession." ")
The noble Lord said: At the last stage I undertook to put down an Amendment to make better provision to safeguard the interest of people who deposit materials on roadways in circumstances where we did not in fact intend to create an offence. This matter was raised by the building trade merchants when the Bill was in another place and an undertaking was given that something would be done about it. This Amendment results from that. I understand that it is perfectly acceptable to those who made representations, I think it is in accordance with the wishes of those of your Lordships who expressed doubts on Second Reading, and therefore I beg to move.
THE EARL OF DUNDEE: I thank the noble Lord, Lord Hughes, for putting down this Amendment, which I think fulfils the undertaking which he gave on Second Reading and which had been given previously in another place.
On Question, Amendment agreed to.
Clause 5, as amended, agreed to.
Remaining clauses agreed to.
Schedule 1 [Minor and consequential amendments]:
LORD HUGHES: This is a drafting Amendment. It was not possible for it to appear until the Bill had reached the stage that it reached a few minutes ago.

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Amendment No. 3 is in exactly the same category. I beg to move.
Amendment moved—
Page 16, line 11, at end insert—
("Roads (Scotland) Act 1970 (1970 c.)
7. In section 24 (obstructions and excavations in roads without consent), in subsection (7), in paragraph (a), head (i) shall cease to have effect.")—[Lord Hughes.]
On Question, Amendment agreed to.
Schedule 1, as amended, agreed to.
Schedule 2 [Enactments repealed]:
LORD HUGHES: I beg to move Amendment No. 3:
Amendment moved—
Page 16, line 44, at end insert—

(" 1970 c.

Roads (Scotland) Act 1970.

In section 24, in subsection (7), paragraph (a)(i).") —(Lord Hughes.)

On Question, Amendment agreed to.
Schedule 2, as amended, agreed to.
House resumed: Bill reported, with Amendments.

ATOMIC ENERGY AUTHORITY BILL [H.L.]
3.27 p.m.
LORD BOWLES: My Lords, on behalf of my noble friend Lord Delacourt-Smith, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now re-solve itself into Committee.—(Lord Bowles.)
On Question, Motion agreed to.
House in Committee accordingly.
[The Lord MERTHYR in the Chair.]
Clause 1 [Transfer of part of Authority's undertaking to Nuclear Fuels Company]:
On Question, Whether Clause 1 shall stand part of the Bill?
LORD WADE: May I raise a small but I think an important point? I hope that this is the appropriate occasion on which to raise it. Your Lordships will have
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noticed that both the Title of the Bill and Clause 1 refer to the setting up by the Minister of Technology of British Nuclear Fuels Limited, and I understand that the Minister has already referred to this as "B.N.F." That I think may lead to some confusion. There is already a body, British Nuclear Forum, which is commonly known as "B.N.F." We do not want to have two "B.N.F.s" and I suggest that British Nuclear Fuels might be called by some other name, such as Nuclear Fuels International. I hope the Minister will consider this point, and that, if necessary, some Amendment will be introduced at a later stage.
THE EARL OF BESSBOROUGH: This matter has only just been put to me, but I think that the noble Lord, Lord Wade, has made a point with a good deal of sense in it and I should be very happy to support him.
THE MINISTER OF STATE, MINISTRY OF TECHNOLOGY (LORD DELACOURT-SMITH): I can undertake that we will give consideration to the point which the noble Lord has raised, but at the same time I do not think I ought to hold out any hope that we shall necessarily be able to meet him. I am conscious of the coincidence of initials, but I am afraid that it is the case in our modern world, with its proliferation of organisations and of initials, that we cannot always avoid coincidences of this kind. However, in view of the comments which the two noble Lords have made, we will examine this point.
LORD WYNNE-JONES: Would my noble friend notice that the term "fuel" is being used in an extraordinary way? According to the normal definition, the word "fuel" in the term "nuclear fuel" is quite inappropriate. In fact, there is no such thing. A fuel is something which is combustible, and the essence of the material that is used is that it is not combustible but is decomposed by a process of spontaneous fission. One would have thought, therefore, that it is quite wrong to perpetuate this misuse of the word "fuel" and that we should rather use a word like "resource" or something of that sort.
LORD DELACOURT-SMITH: I will also examine my noble friend's point, but again I should not like to hold out much hope of being able to meet it. The use

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of the term has begun, as my noble friend implied, and therefore it is not going to be easy, nor am I convinced that it is necessarily appropriate, to try to effect a change at this stage. But I will examine the point my noble friend has made.
Clause 1 agreed to.
Clauses 2 to 7 agreed to.
Clause 8 [Employees in transferred parts of undertaking]:
On Question, Whether Clause 8 shall stand part of the Bill?
THE EARL OF BESSBOROUGH: On the Second Reading of the Bill, I said that generally speaking we welcomed it but that I should like a little further information on some of the provisions as to employees in the transfer of parts of the undertaking, who are dealt with in this somewhat complicated Clause 8. It appears from this clause that the Authority employees who are being transferred to the new companies would automatically become employees of the appropriate companies on the appointed day.
The Institution of Professional Civil Servants have put the point to me that this is an unusual provision, in that staff are not given an option of whether they would prefer to transfer to the companies or remain with the Authority. I was given to understand that the Minister of Technology felt that the only practical pro-position was to provide for this automatic transfer and that there was a special obligation to ensure that the terms and conditions of service with the new companies were satisfactory. It seems, however, that the staff who would be transferred automatically are concerned about what their future terms of service will be. I understand they feel that they are en-titled to know precisely where they will stand during the interim period, and they would like to have an assurance that they will get the benefit of any change in Authority terms and conditions of service.
I also spoke on Second Reading about Capenhurst, where a considerable development team is engaged on this centrifuge process. Some of the staff are concerned that when development work on this process is run down, there will be no alternative work for this team. The staff naturally hope that they may be given an assurance that if they do run out of work the Government will make
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every effort to find them work elsewhere. I think that since Second Reading the noble Lord has had an opportunity of discussing this matter with the I.P.C.S. and I wonder whether he has been able to meet them on this point.
LORD DELACOURT-SMITH: I am glad to respond to the questions of the noble Earl and try to provide a little more information about the point to which he has directed attention. There have been, of course, a number of consultations with the I.P.C.S and with other trade unions and staff associations who represent the staffs who will be affected by the transfers. Since Second Reading I have had an opportunity of meeting representatives of the non-industrial staff concerned, which includes the I.P.C.S., and I can say that there was a useful discussion. A number of points were taken for further consideration, and while I should not like to say that we shall necessarily be able to reach completely satisfactory arrangements on every point, I hope that any further exchanges will reach finality well before this Bill has completed its progress through Parliament, so that if there are any points upon which any of the staff concerned feel that Parliamentary attention should be directed, they will have an opportunity of doing this before Parliamentary proceedings are completed.
As for the position of staff who may find that the particular work on which they are engaged is running down over a period of time, I should not like to become involved in detailed discussions about a particular matter which is mainly the responsibility of the Authority or of the two companies in the future, but in the field of public service there is a pretty well established practice of seeking to look ahead as far as possible, to fore-cast changes in work load and to try to make appropriate provisions to ensure that the staff will be satisfactorily and effectively allocated to new work. This is nothing new. It is a continuing process which is well established.
Briefly, the general position is that in this case the necessity arose to choose between two methods of transference of staff: the method of giving an individual option or the method of making a bulk transfer of staff from the Authority to the proposed companies by the Statute

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itself. This choice has arisen on previous occasions when there have been transfers of work from one employing authority to another. In cases such as at present, where the scale and nature of the transfer—and this involves some-thing like one-third of the staff of the Atomic Energy Authority—make it difficult, indeed impracticable, to use the option method, the other method of transfer under Statute has been applied. This is by no means the first case in which the transfer from one employer to another has been effected by Statute, and in my discussions a day or two ago I had an opportunity of re-emphasising the point to which the noble Earl has referred, that where such a transfer is effected by Statute, special obligations arise to ensure that the position of the staff is safeguarded.
THE EARL OF BESSBOROUGH: I am grateful to the noble Lord for looking at these points once again. I hope that they will be resolved satisfactorily either during the course of the passage of the Bill through this House or in another place.
Clause 8 agreed to.
Clause 9 [Machinery for settling terms and conditions of employment]:
On Question, Whether Clause 9 shall stand part of the Bill?
THE EARL OF BESSBOROUGH: On this point regarding the machinery for settling terms of conditions of employment, I am told that there is some concern regarding subsection (2)(b) and subsection (3) of this clause. Sub-section (2)(b) says:
"… the agreement shall provide for arbitration in any case of dispute on the question whether any particular terms and conditions proposed to be so substituted would conform to that principle."
Then subsection (3) states:
"… references to terms and conditions of employment shall be construed as not including any terms or conditions relating to pensions or to inclusion in a pension scheme."
While I have not put down any Amendment to this effect, pending the Minister's reply, I think that the I.P.C.S., whom I have already mentioned, would like to see the word "not" excluded from subsection (3). Otherwise the two subsections are rather contradictory. If an Amendment
868
to that effect were made, this would en-able the new scheme to be put to arbitration.
I should be grateful to the noble Lord if he could say whether he thinks that such an Amendment, if it were put down at Report stage, would have any chance of being accepted. The matter is again rather complicated, and perhaps he can elucidate the situation. It seems to me that it would be useful to have an assurance that it is not the Government's intention to set up new schemes as a matter of policy if the A.E.A. scheme can be suitably amended to cover the new companies, and if this is acceptable to the new companies when they are formed and have had time to consider the matter.
LORD DELACOURT-SMITH: Clause 9(3), to which the noble Lord has referred, following upon his reference to subsection (2), deals specifically with the provision covering people who are transferred. This clause is addressed to the terms and conditions, other than in respect of pensions, which shall apply. Sub-section (3) appears here because the question of pensions is dealt with separately in Clause 19, and the considerations in dealing with pensions are somewhat different from those which arise in dealing with other terms and conditions. It there-fore seemed far better, and to make for clarity for all concerned, to separate them in this way.
The noble Earl has particularly referred to the point about the availability of arbitration in respect of the pension pro-visions. Let me say, first of all, that it has been the practice hitherto in the Civil Service for pension provisions as such not to be the subject of arbitration. Pensions in the Civil Service have tradition-alley been dealt with by a series of Superannuation Acts of Parliament and have not been within the scope of arbitration. At the same time, the particular point with which we are dealing, and which I understand has given concern, is not so much a general issue of arbitrability of the items of a superannuation code (I think we can all see that there could be difficulties about subjecting items of a superannuation code to abritration), but the narrower point of whether, when the Minister comes to make his decision, as he must, on the subject of pensions under Clause 19, he should make that decision himself, or whether the acceptability of

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the schemes as a whole which the new companies have established should be referable to arbitration.
We have already given an assurance (and I put it on record here) that before the Minister reaches his decision upon that point he will give an opportunity to the trade unions and staff associations representing the staffs in the companies to put forward any views that they wish to put forward upon the schemes. It is envisaged that the schemes within the companies would be negotiated between the trade unions and the companies. We have given this undertaking about consultation. We have also undertaken to look further at the matter to see whether there is anything more that can be done. But here again, as I said on Clause 8, I should not like necessarily to hold out the expectation that We shall be able to move any further on this point. However, I hope that we shall reach a final position before the Bill completes its progress through Parliament.
THE EARL OF BESSBOROUGH: I am grateful to the noble Lord for that clear explanation.
Clause 9 agreed to.
Clause 10 agreed to.
Clause 11 [Provisions as to shares in the companies]:
3.48 p.m.
THE EARL OF BESSBOROUGH THE EARL OF BESSBOROUGH moved Amendment No. 1:
Page 12, line 24, leave out subsection (3).
The noble Earl said: Clause 11 is the main point of contention that we have with the Government on this Bill, and it is for this reason that my noble friend and I have put down this Amendment. To begin with, I was not entirely happy with subsection (1), which states:
"The Minister may at any time by order made by statutory instrument transfer to him-self all or any of the shares in either of the companies which are for time being held by the Authority; and any shares transferred by such an order shall vest in the Minister by virtue of the order and without further assurance."
However, I see that subsection (2) says:
"Any statutory instrument containing an order under subsection (1) of this section shall be subject to annulment in pursuance of a resolution of either House of Parliament."
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It seems to me that this subsection would enable us to annul the instrument if it seem necessary to do so.
However, it is subsection (3) that really worries us and that we propose should be deleted. Subsection (3) states:
"In the case of each of the companies the Authority, at any time when any shares in the company are held by them, and the Minister, at any time when any shares in the company are held by him, shall so exercise—

(a) all such rights and powers as may be exercisable by the Authority or the Minister, as the case may be, as a member of the company, and

(b) any power to dispose of any shares in the company,

as to secure that, at all times, the shares in the company held by the Authority or by the Minister, or the aggregate of such shares held by them collectively, carry in the aggregate more than half of the voting rights exercisable at general meetings of the company."
The point that I want to emphasise, which I outlined on Second Reading, is that even if at the outset it may be appropriate for the Minister and A.E.A. to have a majority holding in the companies, I do not think this should be written specifically into the Bill. The noble Lord, Lord Delacourt-Smith, knows that we on this side consider that these two companies should be healthy and profit-making, and that they could well be suit-able companies in which the public at large should be entitled to invest. We know already from the Explanatory Memorandum that these parts of the Authority, which are to be transferred to the new companies have been showing surpluses of not less than £3·5 million in respect of fuels—I am sorry to use that word again, but it is in the Bill—and about £200,000 in respect of the isotope company which is called Radiochemical Centre Limited.
We on this side of the House see no reason why these companies should remain at all times, as the clause says, under Government control. There is, in my view, a curious ambivalence in the attitude of the Government in regard to the formation of these companies. As I said on Second Reading, the Government seem at last to have come round generally to our view that the various undertakings of the Atomic Energy Authority, both in regard to the design and construction of reactors, and the manufacture and sale of fuel and isotopes, should now be dealt with entirely on a commercial basis, and the Government have used the word

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"commercial" on various occasions. That is why we welcome the Bill in principle. The Government, on the other hand, also say that these two companies must effectively continue to be con-trolled by the Government and the Authority, by their majority voting rights. That means that decisions made by the boards of the two companies will inevitably have to be referred back to the Minister, and that will result in delays of the kind we may have experienced in the past when the Government (or shall I call them parastatal authorities? such as the A.E.A.) have been in control. In the United States, for example, all these activities
are undertaken by commercial companies operating in a normal fashion. They may be operating under licence, but they are commercial companies.
In my view, our effective competition in world markets may be vitiated if too many questions ar referred back to the Government, and not only the Government but also the residual Authority. Surely the advantages to be gained by the creation of these companies—which we welcome—would in a sense be can-celled out or neutralised by this pro-vision. It is interesting that in the case of British Petroleum the Government now have a holding well below 50 per cent, in that company, and that seems to work reasonably well. There is now no mystique about fuel, enriched uranium or isotopes which should preclude for all time the manufacture and sale of those products from being in the hands of commercial companies with not necessarily a Government majority. I consider that there should be a proper balance on the boards of these companies and that industry should be well represented on them. I do not know whether the Minister would claim that there are security considerations here, but, as I said on Second Reading, I do not think that that is an adequate excuse. American companies operate under a healthy system of free enterprise in these matters, as do a number of industrial companies in this country in manufacturing defence equipment. It is for this reason that my noble friend and I are moving this Amendment.
LORD RITCHIE-CALDER: I hope my noble friend the Minister will resist this Amendment. I have always believed
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that the community ought at least to have the advantage of what we have our-selves created, and nuclear energy and the nuclear industry was born nationalised. Therefore I hope we shall continue to safeguard not only the health and welfare of the companies themselves, but also the advantages to the community. I do not think there can be any possible argument that the community, the Government in this sense, the A.E.A. or whatever it may be, should in fact retain the majority rights.
LORD SHERFIELD: Following on what I said on the Second Reading of the Bill, I rise to support this Amendment. It does not seem to me to be necessary to legislate at this time and in this detail about events which may or may not occur. Nor do I feel it is necessary that the Government—or a Government agency—should at all times hold more than 50 per cent, of the shares. The precedent of the arrangements in respect of the British Petroleum Company, to which the noble Earl refer-red, had also occurred to me. Those arrangements have worked very well over a number of years in the case of oil fuel. I do not see any reason why, if the circumstances changed, they might not work equally well in the case of nuclear fuel. I should not have thought that it was necessary to make any provisions at this time for something which may occur in the future. In any case, these companies will be producing radioactive substances and therefore will at all times be under the control of other legislation which covers the production and sale of those substances. For these reasons, I support the Amendment.
LORD CAMOYS: I should like to support the noble Lord who has just spoken. I think that the Government are mistaken in this matter and it is much better to let free enterprise work under reasonable Government supervision. That is how we do it in America, and I see no reason why we should not do the same thing here. The Government did not get the Post Office working very well, and there is no reason why they should get nuclear fission working very well.
LORD WYNNE-JONES: I usually find myself very much in agreement with the noble Earl, Lord Bessborough, and the noble Lord, Lord Sherfield, and I am

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rather surprised at their attitude in this matter. Here we have moved from a position in which the production of the nuclear energy stations in this country has not been sufficiently well organised, and the Government have accepted the recommendation that in order to do this these new companies should be set up. This seems a very sensible situation, and 1 am sure that all noble Lords agree with this general proposal.
The question is, what sort of ultimate control are we to have? The proposal here is a very simple one: that there should remain a control which is not a control by a Minister but a control in general by the Government. That is to say, the Government should have ultimate control. That does not in any way affect the running of the organisation as a commercial one. I think the noble Earl has already admitted that essentially the new body will run as a commercial organisation, for definite commercial use and for commercial profit. Therefore, it would seem very reasonable that the Government should include in the Bill a statement that there should be reserved the right to preserve a majority—not absolute control, but a majority—on the board of the company. I should have thought that this was a very sensible and realistic thing.
We often hear quoted the wonderful example of the American industry. In fact, noble Lords will recollect that a few years ago a book was produced (I think that the author's name was David Burns) on nuclear power; and in that book it was suggested that the whole of the working of the industry in this country had been disastrous and that the whole of the working in America was wonderful. It was the most perfect example of selective choice of detail that I have ever come across in my life. I went through that book carefully and I think it is a book
which is almost completely nonsensical. I was rather interested this last winter, when I spent three months in America, to find that during the period I was there the New Jersey Public Utilities Company were protesting strongly that General Electric, who were under contract to them to pro-duce a nuclear station, were two years late—I repeat, two years late—in commissioning this station, and that it was still not able to work. This of course was
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back last December: it may be working by now. They were thinking of suing General Electric for a large sum of money, something of the order, I think, of 5 million dollars. So the idea that the Americans do everything perfectly is by no means true, and in this field of nuclear energy I do not think we have anything to be ashamed of at all. I believe that this proposal in this Bill before us is a very sensible one, and one that should guarantee that we proceed in the future along the right lines.
LORD MOWBRAY AND STOURTON: I should like to support my noble friend in this Amendment. I shall be very brief. I would say to the noble Lords, Lord Ritchie-Calder and Lord Wynne-Jones, that although nationalisation has been approved by their Party, and in many cases has worked very well, we are dealing in this particular case with what the Minister in another place has publicly stated he hopes will lead to increased international trade. Experience has shown that when one is dealing with foreign trading corporations there is somehow an easier atmosphere if they are not dealing with a fellow industrial body which is Government-controlled. It may be no more than a psychological feeling, but I think that feeling exists.
The Minister himself stated that one of the objects of these two companies was to create an organisation which permits the sort of international industrial links that will be of critical importance in all sectors and not just in atomic energy; and he also said that it was intended to do this with a special eye on the future of the European nuclear industry in co-operation with our partners in Europe. In these international trading agreements which we have had, as my noble friend Lord Bessborough and the noble Lord, Lord Sherfield, pointed out, we can consider British Petroleum, I believe with 49 per cent, control, which was con-sidered to be not absolute. That control was considered to be an advantage to British Petroleum in their trading dealings with the rest of the world. I personally should like to see the public allowed to come into this later. In that case, it could be considered whether we could have a quotation on the market. In any event, for the reasons I have given I beg to support my noble friend.
4.5 p.m.
LORD DELACOURT-SMITH: In the Amendment which the noble Earl has moved we have had put before us a very fundamental point which goes to the very character or essence of the Bill which the Government are placing before the House. The earlier interventions of the noble Earl were very much directed to the anxieties of the staff who are to be transferred to the Nuclear Fuels Company and the Radiochemical Company. I cannot help thinking that the Amendment he is now moving conflicts most strangely with the points which he was raising earlier, be-cause from all that I have seen, nothing would increase the concern of the staff of the Authority more than the adoption of this Amendment. But I hope I shall be able to show your Lordships good reason why it should not be adopted.
In this Bill we are dealing with the development of what I think everybody will accept as a part of a great national asset. That asset has been built up by public effort of public servants with public money. It is the intention of the Government that this new stage of development upon which it is entering should be to the public advantage. We are of the opinion that the form of organisation which we are proposing, with its flexibility but maintaining its essential characteristic of a predominant public voting majority in the two companies, is the right one.
I must confess that I think some of the anxieties which have been expressed are not well founded. It has been suggested, for example, that it is desirable in the important field of development which these companies have before them that they should have an independence; that they should be able to co-operate with organisations in other countries. Indeed, in moving the Second Reading of the Bill I explained that that was a part of our thinking. Reference has been made
to the possibility of interference by the Minister or by the Authority in day-to-day management of the affairs of the company. The very purpose of the Government in establishing the companies in this form is to ensure that, while the necessary degree of public control is maintained, there should be the maximum flexibility and freedom and the maximum scope for single-mindedness in
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the day-to-day activities of the companies.
Reference has been made to British Petroleum. I am far from thinking that this is a particularly apposite comparison in this connection. But I would draw attention to the fact that the holding in British Petroleum was a 51 per cent, holding by the Government for about half a century, and that that position was maintained without interference in the day-to-day management of the British Petroleum Company.
THE EARL OF BESSBOROUGH: No longer.
LORD DELACOURT-SMITH: No, no longer; but after a period of fifty years in which there was no interference with the day-to-day management, since British Petroleum has been quoted I think I am entitled to point out that a Government interest of this kind does not involve interference with day-to-day management.
What in fact are we envisaging? We are envisaging under the Bill that private companies should be given an opportunity to participate in this development, but within the framework of the public advantage. The companies to be set up will not be concerned with the admission of private firms which may look upon the nuclear fuel industry or the radiochemical industry from the prime point of view of representing advantageous opportunities for a profitable investment. But the prime concern in admitting participation of private companies will be to find those which have a real contribution to make by way of their marketing experience, their financial experience or by way of other relevant skills and experience which they may have to offer to the development and advancement, both at home and abroad, of the companies with which we are concerned.
The test of the framework right through is the national and the public benefit. There are two main reasons which I should like to adduce as creating the justification for this proposal. First, in the fields with which they are respectively concerned the Nuclear Fuels Company and the Radiochemical Company will have important monopolies. The fuel company will be the supplier of an important source of energy to the generating boards, and the Radio-chemical Company will be virtually the

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only supplier of radio-isotopes, for ex-ample, to the National Health Service. That is one of the reasons why the Government believe that in the present stage of development there is a strong argument for a majority public share-holding. But I think when one comes to the argument of national security, the case is even more overwhelming. Let us take the fuel company and concentrate on that. It will be engaged in the enrichment of uranium and the production and separation of plutonium, both of them materials forming vital constituents of nuclear explosives. The fuel company will have the custody of the national stock of uranium ore, and it will be responsible for supplying fissile materials to the Government for incorporation in atomic weapons and the propulsion units of nuclear naval vessels.
It is said by the noble Earl, "Ah, but in other countries a different situation prevails." Of course, it is true that in other countries there is a degree of private participation in the atomic energy field, as we are proposing that under this Bill there should be in this country. But in the Western World the only organisations which possess a complete cycle of facilities for the production,
fabrication into fuel elements and the re-processing of fissile material of all degrees of enrichment are public authorities. In the United States of America it is the Atomic Energy Commission; in France it is the Commissariat à I'Energie Atomique, and in this country of course hitherto the production group of the Atomic Energy Authority, whose activities are to be transferred to the fuel company. In both the United States of America and in France enrichment facilities in particular remain under Government control, and in France Government control extends over other parts of the fuel cycle as well. The recent Tripartite Agreement with the Netherlands and the Federal Government of Germany for the development and exploitation of the centrifuge process of enrichment contained provisions to ensure adequate political control over the activities of the Tripartite enterprises.
Of course, there are companies in other countries which undertake various stages of the fuel cycle, and which in particular manufacture nuclear fuel elements, but there are no commercial companies over-seas which are in the position that the Nuclear Fuels Company would be, to
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manufacture materials which form the constituent of nuclear explosives. The Government are therefore satisfied that the Bill must provide for the Nuclear Fuels Company not to pass into private control.
The noble Lord, Lord Sherfield, asked why this should be put into the Bill. First, I think it is desirable that we should make clear in the Bill what our conception is of the basis upon which development should take place in the future, so far as we can foresee it. But, of course, nobody can foresee the ultimate developments in this regard. The noble Lord, Lord Sherfield, asked whether this was to be for ever. I would submit to your Lordships that this is not a decision, as far as I understand it, that anybody is urging should be taken immediately. I think everybody accepts that what is envisaged in the Bill should continue, at any rate for a period. We are asked whether we should put this into the Bill and make necessary a further Act of Parliament if there is to be any fundamental change.
In the earlier part of this clause— and the noble Earl welcomed this fact —even if the Minister is to make a transfer of the shareholding in the fuel company from the Atomic Energy Authority to himself, it must be subject to a Statutory Instrument over which this House and another place would have a negative control. It is not something which can be done by the administrative act of the Minister without the knowledge of Parliament and without Parliament having an opportunity to express an opinion.
That is a feature which, compared with the point now before us in this Amendment, is quite a secondary point— merely the transfer from one form of public authority to another. When it is emphasised that that should be something which can come before Parliament and which Parliament must be able to veto if it so desires, I am astonished that it should be suggested that we should allow a situation to arise from this Bill now before us in which, by some administrative process, by some act of which Parliament need have no knowledge, and one which it certainly would not be specifically required either to endorse or allowed to veto, we should be prepared to allow such a fundamental change

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being made to the development of so vital an industry in this country as the Amendment implies.
THE EARL OF BESSBOROUGH: I have listened most attentively to what all noble Lords have said, and I would first emphasise that what we object to most are the words "at all times". As the noble Lord, Lord Delacourt-Smith, has said, in the case of British Petroleum the Government majority holding did not last for all time, and that is one of the main reasons why I still feel that this sub-section cannot remain as it is now. I agree with the noble Lord, Lord Wynne-Jones, that not everything Americans do is perfect—by no means. Nevertheless, I think that there are advantages in these companies' not being necessarily under public control. What is the point of creating these new companies if the ultimate effect is to transfer the work from one public authority to yet another public authority? In these circumstances, what is the object of setting up these companies?
With regard to the point of the transferability of pensions, I propose to speak about that under Clause 19. This is most important, and I agree that the noble Lord has a point when he says that the
staff—and we all wish to consider their interests—would naturally prefer to re-main with a public authority with the same superannuation terms as they had in the previous authority. But what I am going to advocate under Clause 19 is that we should work to this system of the transferability of pensions, of which I know a number of noble Lords on both sides of the Committee are in favour. I will not at this moment pre-empt my own remarks on this subject but if we do achieve transferability of pensions from the public sector into the private sector— from public industry, so to speak, into private industry—then surely any objections which the staff may have will be met.
On the security issue the noble Lord has not convinced me at all. He has admitted that military weapons are manufactured by private industry and, as I have said, I still do not see the need for this subsection. There is this basic difference between us and for the reasons I have given I am afraid I cannot with-draw my Amendment.
4.19 p.m.
On Question, Whether the said Amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 75; Not-Contents, 63.

CONTENTS

Aberdare, L.

Elgin and Kincardine, E.

Monckton of Brenchley, V.

Aberdeen and Temair, M.

Elliot of Harwood, Bs.

Mowbray and Stourton, L.[Teller.

Abermarle, E.

Emmet of Amberley, Bs.

Aldenham, L.

Falkland, V.

Napier and Ettrick, L.

Alexander of Tunis, E.

Ferrier, L.

Nugent of Guildford, L.

Allerton, L.

Fortescue, E.

Rankeillour, L.

Ampthill, L.

Goschen. V. [Teller.]

Rathcavan, L.

Auckland, L.

Gowrie, E.

Robertson of Oakridge, L.

Baldwin of Bewdley, E.

Gray, L.

Rochdale, V.

Barnby, L.

Grenfell, L.

Rowallan, L.

Belstead, L.

Grimston of Westbury, L.

St. Aldwyn, E.

Berkeley, Bs.

Hawke, L.

Sandford, L.

Bessborough, E.

Ilford, L.

Sandys, L.

Blackford, L.

Inglewood, L.

Selkirk, E.

Brecon, L.

Ironside, L.

Sempill, Ly.

Brooke of Cumnor, L.

Jessel, L.

Sherfield, L.

Brooke of Ystradfellte, Bs.

Killearn, L.

Somers, L.

Brougham and Vaux, L.

Kilmany, L.

Stonehaven, V.

Cottesloe, L.

Lauderdale, E.

Strathcarron, L.

Craigavon, V.

McCorquodale of Newton, L.

Strathclyde, L.

Daventry, V.

Mancroft, L.

Teviot, L.

Denham, L.

Massereene and Ferrard, V.

Thurlow, L.

Derwent, L.

Merrivale, L.

Trevelyan, L.

Drumalbyn, L.

Milverton, L.

Vivian, L.

Dudley, E.

Molson, L.

Wolverton, L.

Dundee, E.

NON-CONTENTS

Archibald, L.

Gardiner, L. (L. Chancellor.)

Pargiter, L.

Ardwick, L.

Garner, L.

Phillips, Bs. [Teller.]

Beswick, L.

Garnsworthy, L.

Platt, L.

Boothby, L.

Hanworth, V.

Plummer, Bs.

Bowles, L.

Hilton of Upton, L. [Teller.]

Raglan, L.

Brockway, L.

Hughes, L.

Sainsbury, L.

Brown, L.

Hylton-Foster, Bs.

St. Davids, V.

Buckinghamshire, E.

Jacques, L.

Serota, Bs.

Burton of Coventry, Bs.

Kilbracken, L.

Shackleton, L. (L. Privy Seal.)

Chalfont, L.

Leatherland, L.

Sorensen, L.

Champion, L.

Lindgren, L.

Southwark, L.Bp.

Citrine, L.

Llewelyn-Davies, L.

Stocks, Bs.

Clwyd, L.

Llewelyn-Davies of Hastoe, Bs.

Strabolgi, L.

Cork and Orrery, E.

Longford, E.

Summerskill, Bs.

Cowley, E.

Loudoun, C.

Walston, L.

Delacourt-Smith, L.

Lucas of Chilworth,L.

Willis, L.

Donaldson of Kingsbridge, L.

McLeavy, L.

Wilson of Langside, L.

Douglass of Cleveland, L.

Milford, L.

Winterbottom, L.

Faringdon, L.

Morrison, L.

Wise, L.

Fulton, L.

Moyle, L.

Wootton of Abinger, Bs.

Gaitskell, Bs.

Nunburnholme, L.

Wynne-Jones, L.

On Question, Motion agreed to.

Resolved in the affirmative, and Amendment agreed to accordingly.
Clause 11, as amended, agreed to. Clauses 12 and 13 agreed to.
Clause 14 [Accounts of companies to be laid before Parliament]:
LORD DELACOURT-SMITH LORD DELACOURT-SMITH moved Amendment No. 2:
Page 14, line 10, leave out from second ("of") to end of line 20, and insert ("any accounts which, in accordance with any requirement of the Companies Acts 1948 to 1967, are laid before the company at that meeting. and of any documents which are annexed or attached to any such accounts.").
The noble Lord said: The Amendment before your Lordships is designed to cure certain defects of a technical nature in the clause as at present drafted. This clause refers to the requirements of the Companies Acts 1948 to 1967. The first defect is that, as drafted, it appears to suggest that the Acts require accounts et cetera, to be laid before any general meeting of the company, or at any rate that there are certain general meetings before which the Acts require accounts to be laid. That is not the case: the requirement is simply that the accounts have to be laid before a general meeting of the company. Further, the clause as drafted fails to cover certain statements which require to be annexed to the accounts, and wrongly refers to "statements" required to be attached to the balance sheet. The intention of the clause, to which the Amendment seeks to give effect, is to cover the profit and loss account and the
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balance sheet; certain documents annexed to the accounts containing various particulars such as the directors' emoluments and the auditors' and directors' reports which are attached to the accounts. I beg to move.
THE EARL OF BESSBOROUGH: This Amendment is perfectly acceptable to us.
Clause 14, as amended, agreed to.
Clauses 15 and 16 agreed to.
Clause 17 [Grants in connection with gas centrifuge process]:
4.33 p.m.
LORD DELACOURT-SMITH LORD DELACOURT-SMITH moved Amendment No. 3:
Page 16, line: 4, leave out from ("for") to (" but ") in line 5, and insert (" any investment grant for which it would have been eligible ").
The noble Lord said: I beg to move the Amendment standing in my name. Briefly, the position is that under the Tripartite Agreement, with which your Lordships are familiar, the two companies which are to be established under that agreement either will or may establish plants in the United Kingdom, Germany and Holland; and the enrichment organisation, for example, is to establish a subsidiary company which will operate a plant at Capenhurst. The subsidiary company will itself have a minority holding held by the British Nuclear Fuels Company. It has been agreed with the German and Dutch Governments that investment grants will not

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be claimed in respect of these companies operating and established under the agreement, because such grants would disturb the sharing arrangements between the three Governments embodied in the agreement. But the Bill provides that the Minister is to make compensatory grants to the British Nuclear Fuels Company.
The Amendment before your Lordships has the purpose of amending in a small respect the assumptions which the Minister is required to make when calculating the amount of any grant that he may make to the Nuclear Fuels Company under the clause, the general effect of which I have sought to explain. While the proposed grants to the Nuclear Fuels Company are to be based on the amount of the investment grant that would have been paid to the disqualified company (the "designated company" as it is described; that is to say, the company which I described in my example as the enrichment organisation's subsidiary company), it would not be appropriate to make the compensatory grants equal to the investment grant. The reason is that the receipt of an investment grant has certain tax implications, in that it affects the capital allowances that may be claimed in respect of expenditure incurred on the asset in relation to which the grant is paid. Because of this, the actual value to a company of the investment grants it receives may be less than the amount of the grants themselves. In order to ensure, therefore, that any compensating grant which may be paid to the Nuclear Fuels Company under this clause does not exceed the net loss suffered by the designated company, the clause provides that the grant to the Nuclear Fuels Company is not to be equal to the amount of the relevant investment grant but is to be equal to that amount abated by reference to these tax considerations.
Of course the Minister's powers to make investment grants is a discretionary power, and he does not in all cases pay grant up to the full extent of his powers but withholds grant on various classes of assets, even though they are in fact eligible for grant. The wording of the subsection as drafted, however, requires the Minister, in calculating the tax reduction factor, to assume that he would pay
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grant in every case in which he could do so, irrespective of whether, in the exercise of his discretion under the Act, he would in practice have made any grant. This is not the intention, although this is how the Bill as at present drafted reads. The aim of the provision is to require the Minister to compare the actual tax position of the company with what would have been the position in this respect if the Minister had been paying investment grant to the designated company in the normal exercise of his discretion.
It is therefore proposed by the Amendment which I am moving that the sub-section should be amended so as to provide that in assessing the tax reduction factor the Minister should be required to assume only that if the designated company had not been debarred from receiving any investment grant it would have applied for any such grant for which it would have been eligible. The Minister will then be free, in calculating the tax reduction factor, to estimate what investment grants he would, in the exercise of his discretion, have paid to the designated company. This is a somewhat complex matter, but I trust that I have been able to summarise it to your Lordships' satisfaction and that your Lordships will accept the Amendment.
THE EARL OF BESSBOROUGH: As I understand it, this Amendment is quite reasonable. Indeed, I thought it was quite reasonable after the noble Lord had said his first three sentences. I appreciated then that the investment grants would balance the tax. Matters seemed to get a little more complicated later. However, I think that the basic principle behind the Amendment is perfectly acceptable to us.
Clause 17, as amended, agreed to.
Clause 18 agreed to.
Clause 19 [Pension schemes]:
4.40 p.m.
LORD DELACOURT-SMITH LORD DELACOURT-SMITH moved Amendment No. 4:
Page 18, line 41, leave out (" service with the Authority") and insert ("previous service ").
The noble Lord said: I beg to move the Amendment standing in my name on the Order Paper. As the noble Earl has indicated, this is a clause for which he has considerable concern and which he regards as an important one, but the Amendment I am moving is really no more than a clarification of one detailed point in the clause. The clause is concerned to secure that the Minister does not make any order withdrawing the application of the Authority pension schemes to employees of the companies unless he is satisfied that each company scheme is, taken as a whole, no less favourable than the corresponding Authority scheme.
In order to comply with this requirement it would be necessary for the company scheme to treat as reckonable ser-vice of the employee in question first of all any service which the employee had with the Authority in an Authority scheme; secondly, any service which the employee had with the company in an Authority scheme; and thirdly, any pre-Authority service which was rendered by the employee before he entered the employment of the Authority in the first place which was reckonable under the Authority's scheme. The most obvious example is that of civil servants who transferred at an earlier point to the employment of the Authority and who are entitled under the Authority's scheme to reckon, subject to certain conditions and regulations, their civil service as though it were service with the Authority for the purpose of the scheme. The Bill, as drafted, did not quite satisfactorily and clearly cover that point, and that is the reason for the Amendment now before your Lordships.
Perhaps I should say a word about the words "and otherwise" which appear, because it could possibly be held that "and otherwise" makes this clarifying Amendment unnecessary. Those words are primarily intended to cover matters germane to the pension schemes in question but other than reckonability of service, and it was felt better to have the Amendment now before your Lord-ships which would make quite clear the intention that in the company schemes individuals should be placed in no worse position in respect to reckonability of service than they would have been if
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they had remained in Authority employment.
THE EARL OF BESSBOROUGH: I am grateful to the noble Lord for having explained this point to us. My first reaction on reading the Amendment and in looking at the words "previous ser-vice", was, what previous service and where? Would it apply only to civil servants, or would it apply to others? It seemed to me that this particular phrase could have been rather more precisely defined. The noble Lord has defined it in what he has said, and since I imagine we shall all read his remarks when we are applying the Bill when it becomes an Act, and that it will be applied in the light of what he has said, I accept the Amendment—certainly the principle behind it.
While on subsection (4) I should like to say something about the superannuation schemes. As the noble Lord knows, the staff organisations again make the point that they see no practical or other need to establish what seem to be three separate superannuation schemes: one for the Authority and one each for the two companies. Since there will no doubt be a need to interchange expertise between the Authority and the companies, I am a little puzzled by these three rather complicated separate provisions. As the noble Lord knows, ever since reading the Sutherland Report on the question of the transferability of pensions I have been in favour of some system, similar perhaps to that in Sweden, whereby qualified staff in industry, in Government establishments and in the universities have transferable pension rights. I think the Government must have been working on this, and there may be financial considerations which make such a scheme in this country impracticable.
At the same time, I feel that any system which inhibits easy transfer—and I know I have support on this from noble Lords on the other side of the House—-of well qualified engineers or scientists from one sector of the economy to another, particularly between the private and the public sector, is unhealthy. Since the nuclear power group, in so far as the design and construction of re-actors is concerned, have agreed to amend their scheme to provide benefits comparable with those of the Atomic

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Energy Authority, I wonder whether the Government are now reconsidering this matter.
I should be grateful, too, if the noble Lord could tell us how many people may be involved in such a scheme. I understand that there are some 86,000 members of the I.P.C.S. as a whole and that there may be some 6,000 to 7,000 in the Atomic Energy Authority. I under-stand that in another place there was a Private Member's Bill dealing specifically with the whole question of transferability of pensions. I understand that it was dropped, but that it is hoped that the Superannuation and Social Insurance Bill may be amended to cover this point. I do not know whether the noble Lord can enlighten me on this matter. Clearly the staff do not like the provision at the end of subsection (4) which gives the Minister power, by Statutory Instrument, to direct that no pension scheme maintained by the Authority should, on or after such a date as may be specified in the Order, apply to any person employed by the companies. No doubt the Institution would prefer that Clause 19 (4) should be left out altogether, but I shall be glad to hear what the noble Lord has to tell us about this matter and whether he has been able to meet the staff organisations to any extent.
LORD DELACOURT-SMITH: I must at the outset say that I would be very reluctant to get drawn on this Amendment to this clause into a wide discussion of the complex question of general transferability of pensions. We are dealing, after all, with a narrow point, with a particular group of staff. The situation in regard to total numbers is that it is expected that of approximately 31,000 total staff of the A.E.A., some 9,500 will be transferred to the Nuclear Fuels Company, and some 500 to the Radiochemical Company. I understand that if one takes non-industrial staff the figures are expected to be a little over 3,000 transferred to the Nuclear Fuels Company, and virtually the full 500 to the Radio-chemical Company. In other words, virtually all the staff who will go to the Radiochemical Company will be in the non-industrial category, and of those who will go to the Nuclear Fuels Company
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it is expected that 3,000 will be non-industrial, while some 6,500 will be out-side the non-industrial category.
It is the desire of the Minister through this legislation to safeguard the position of the staff so far as possible in the ways indicated. The provision to which the noble Earl referred, that the Minister may make an Order which, after their transfer to the Nuclear Fuels Company, removes certain staff from the scope of the Atomic Energy Authority's pension schemes, is of course a power to be exercised only after there have been negotiations between the representatives of the employees and the companies upon the terms of the new pension schemes which the companies will maintain, and after the Minister has satisfied himself— and I touched on this point earlier, and mentioned some of the discussions that we have had—that the conditions pro-posed under those schemes, taken as a whole, will be not less favourable.
I touched earlier on the reckonability of service, and on our desire to see that the position was made quite clear. On the question of transferability, so far as it arises in this context, I can say to the noble Earl that we appreciate its importance. We have looked at the provisions for transferability which exist under the Atomic Energy Authority's own scheme, and in the discussions which I mentioned on an earlier clause we have indicated to the representatives of the non-industrial staff our willingness to consider their points about the desirability of not impeding interchangeability between the two companies and the Atomic Energy Authority. We shall be looking at this matter and I hope we shall reach some form of finality before the Parliamentary process of this Bill is completed.
THE EARL OF BESSBOROUGH: I am most grateful to the noble Lord for having looked at this matter again, and also for his assurance that there will be further consultations and negotiations with the staff organisations. I am very glad that, generally speaking, he appreciates the importance of transferability, and I accept what he has told us
to-day.
Clause 19, as amended, agreed to.
Clause 20 [Savings and transitional pro-visions]:
LORD DELACOURT-SMITH LORD DELACOURT-SMITH moved Amendment No. 5:
Page 19, line 37, at end insert ("in relation to any premises transferred by virtue of the said section 1.").
The noble Lord said: This Amendment gives me an opportunity of drawing the attention of your Lordships to the fact that in the Explanatory Memorandum the paragraph relating to Clause 20 refers to prohibited place orders being in existence in relation to Springfields, Windscale and Capenhurst. To that list, Chapelcross ought to be added.
This is a drafting Amendment to make it clear beyond doubt that the subsection does what it is intended to do. The general intention of Clause 20 is to preserve the position of the Authority's special constables at establishments which are transferred by the Bill to the Nuclear Fuels Company, and to preserve the effect of any prohibited place orders subsisting in relation to such establishments immediately before the transfer. The Amendment, to which I invite your Lordships' agreement, turns upon the point that the Authority's special constables are appointed in respect of any premises in Great Britain which are for the time being in the possession or under the control of the Authority. It follows that, when premises are transferred from the Authority, the Authority's constables will ordinarily cease to have any power on these premises. The object of subsection (1) is to secure that, notwithstanding the transfers effected by Clause 1 to the Nuclear Fuels Company, the Authority's existing special constables at the transfer date will continue to be able to operate at the establishments transferred.
The Amendment is intended to remove any doubt. If the Amendment were not made there might be doubt that the sub-section did no more than make it clear that the transfers did not affect the position of the Authority's special constables at the establishments which the Authority retained. That is not the intention. I beg to move.
THE EARL OF BESSBOROUGH: I agree that this is purely a drafting Amendment and I am very glad to accept it.
Clause 20, as amended, agreed to. Clauses 21 and 22 agreed to.
Clause 23 [Interpretation and supplementary provisions]:
LORD BELACOURT-SMITH LORD BELACOURT-SMITH moved Amendment No. 6:
Page 20, line 34, leave out ("8(1)") and insert (" 8(2) ".)
The noble Lord said: This is a very simple Amendment and corrects an error in the Bill as it stands, by substituting Section 8(2) for Section 8(1). I trust that your Lordships will accept it.
Clause 23, as amended, agreed to.
Clause 24 and Schedule agreed to.
House resumed: Bill reported, with Amendments.

MERCHANT SHIPPING BILL
5.0 p.m.
THE MINISTER OF STATE, BOARD OF TRADE (LORD BROWN): My Lords, I beg to move that this Report be now received.
Moved, That the Report be now received. —(Lord Brown.)
Clause 7 [Payment of seamen's wages]:
LORD SANDFORD LORD SANDFORD moved Amendment No. 1:
Page 4, line 39, leave out subsection (2) and insert —
("(2) If the amount payable to a seaman under subsection (1) of this section exceeds £50 or such other amount as may be pre-scribed by regulations made under section 9 of this Act and it is not practicable to pay the whole of it at the time of discharge, not less than £50 or, as the case may be, the amount so prescribed shall be paid to him at that time and the balance within 7 days of that time.")
The noble Lord said: My Lords, I suggest that we might bring Amendments Nos. 3, 4 and 5, which are con-sequential, into the discussion. At the same time, I should like to repeat the assurance which I gave the noble Lord, Lord Brown, in Committee: that I am unlikely to resist his Amendment No. 2, also to this clause, if he backs it with a

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rather fuller explanation as to its purpose than that which he gave us at the previous stage.
My Lords, with these four Amendments, as with so much else in the Amendments that we have moved on this Bill, we are inviting the noble Lord, Lord Brown, to put his hand into Lord Pearson's and to step bravely from the 1890s into the 1970s. The first five Amendments deal with the payment of wages to the seaman, and it might help, I think, if I began by reminding your Lordships of what Pearson recommended in this respect. Recommendation No. (7)(a) says:
"The new Act should authorise payment of wages and allotments by cheque or credit transfer or otherwise into a bank account; and it is desirable that payments should be so made…"
Her Majesty's Government have not done that, but they can do it, and I trust they will do it, in the regulations pro-vided for by Clause 9. The second re-commendation that applies here is:
"The employers should have an obligation to deliver to the seaman an account of his wages…"
My Lords, we are agreed about that in principle, but there is a remaining dispute about how and when that should be done. The third recommendation from Pearson was:
"There should be a penalty for delay in the payment of wages, and for this purpose a high rate of interest would be sufficient."
Her Majesty's Government have not accepted that, and we have failed to convince them of the error of their ways; but I will say no more about that now.
Pearson made a very thorough study of this matter, devoting no less than 20 paragraphs of his Report to it, all aimed to bring the conduct of these affairs, the accounts and the payments of wages, from the days of 1894 into modern practice —practice when accounts can be handled on machines and when there are plenty of inexpensive and sophisticated devices, like bank accounts, cheque books and credit transfers, available to owners, officers, seamen and masters alike, all avoiding the tiresome necessity to handle large amounts of money at inconvenient moments. But all these facilities and all this assistance is available only ashore, apart from on the largest liners. They
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are not available afloat, and it is not economic to provide them afloat. Therefore, if a seaman is to be paid in full when he leaves a ship shortly after berthing at home, the final calculations may fall to be done by the master in a small or medium-sized ship, and they fall to him at the precise moment when he is bringing his ship home into some of the most congested sea lanes in the world, and often into some of the most unpredictable weather. In these circumstances —and this is all fully set out in paragraph 360 of the Pearson Report —prompt payment of the whole crew, with precise amounts due to them shown on a full account, is not always feasible, though of course this is agreed and regarded by all parties as the right, normal and proper arrangement to be aimed at.
My Lords, with the severe penalties which are now written into or remaining in the Bill against owners who do not achieve this objective, failures will indeed be very few and far between, and they will occur only when the needs of good navigation and safety at sea make it quite imperative to give accurate pilotage priority over accurate book-keeping. I submit that in these extreme and rare circumstances it is not unreasonable for the owners to have to pay to the crew in respect of wages £50 in cash, and to pre-sent the full account and any balance due within seven days, when the master has had the time and/or the assistance from his office ashore to get all the complex details of a final account checked, correct and up to date.
The maximum first instalment to be paid in cash in these exceptional circum-stances was proposed by Pearson to be £20. That was raised in the Commons. first to £30 at the Committee stage and then to £50. I am now proposing, in my Amendment No. 5, to meet a point made in Committee by the noble Lord, Lord Brown [Col. 151]. I am proposing to make even this amount flexible by regulation. We have accepted the Government's contention that the old, crude and very heavy penalty of wages running on should be continued, and we have not pressed any of the other very reasonable safeguards which we had devised. In these circumstances, it is, I hope the House will agree, not unreasonable to spare the master, when he is obliged to give prior attention to safe navigation on

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returning home, the distraction of producing a preliminary account, which will very likely not be correct, and to give him and his company ashore, in those circumstances and only in those circumstances, seven days' grace —not a long time, as the noble Lord, Lord Brown, indicated in Committee at column 152, but just seven days' grace —to get the final accounts entirely accurate before the presentation of each individual account to each individual member of the crew. I beg to move the first Amendment.
5.6 p.m.
LORD BROWN: My Lords, may I make just one or two preliminary comments before I get down to some arguments about the substance of the Amendment. I accept that the arguments used by the noble Lord have a great deal of force. The idea of getting modern machinery to work on wages is a very powerful argument indeed, and if it can be achieved it is a good thing to achieve. I would back the Amendment if that were all there were to it, but the noble Lord has referred to the idea of getting from the 1890s to the 1970s. To the seaman concerned, it might not seem like progress. Before I get on to the sub-stance of the Amendment, let me make one other point. Nothing in the Bill will prevent payment by cheque, money order, credit transfer or other modern means. I know that this does not meet the noble Lord's point, but I just want to make that point quite clear: there is nothing in the Bill to prevent that, if it can be arranged under the terms of the Bill as it stands now. There is one further point. A good deal of reference has been made to the burden on the master at this critical point, when he is approaching harbour and all the rest of it; but we really must not stress that too much. He has officers on his ship, and he has others. They are not all morons. He can delegate a great deal of this work of preparing wages if he chooses to do so and if he gets these men familiar with the fairly complex business of calculating the wages. I do not see why that should not be done if the burden is so very heavy at that particular time.
Turning to the Amendment itself, I would point out that it would embrace two separate matters. First, if it was
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carried it would mean that a seaman would often get, on discharge, £50, or some amount specified by Board of Trade regulation, and the balance in seven days' time; whereas the clause as it stands would often give a seaman nearly all, or all, of his due wages on discharge, with a possible small balance later on some occasions. There is no need for me to comment on which is most in the interests of seamen. The Amendment would seem to be based on the concept that an account need not be delivered for seven days after discharge, and the amount payable calculated at any time within that period. Although the principle payment in full on discharge is retained, there would be no means of knowing what it was until the account was prepared. In practice, the minimum amount would be paid and the seaman need not in general receive the rest of his wages for seven days. I think that that is implied by the emphasis on modern accounting methods. That is what is likely to happen. I appreciate the desirability of these modern methods; but I do not think that they should be adopted at the expense of the seamen.
The Amendment would also enable the Board to make regulations prescribing some amount other than £50, instead of having the reference to one-quarter as an alternative. I am not unsympathetic to the proposal that it should be possible to amend the minimum amount by regulations, but I think that the necessary flexibility is already covered by the provision for one-quarter of the amount to be paid as a minimum. Of course, if there is to be no prior calculation, as in other Amendments to be moved later by the noble Lord,
one-quarter cannot be calculated. I do not accept that the seaman should not know on discharge what is due to him. Seamen prefer to have a guarantee in terms of one-quarter.
Finally, it seems to me that it goes against the principle of fair employment that a man should be denied until seven days after his discharge knowledge of the total of the wages he has earned. It is conceivable that within seven days he will want to sign on to another ship, or will move to a different port in the country to sign on there. He will have to make arrangements for his family, and he will want to know what money is due

895
to him. In many cases, if this Amendment is passed he will not know for seven days. I think this would be a retrograde step for the seaman, and though 1 admit that it would be an advance for the employer, that is not sufficient, on balance, to cause me to accept this Amendment; it is too detrimental to the seamen. I hope that I have persuaded your Lordships that on balance of argument this Amendment should not be accepted.
LORD SANDFORD: My Lords, I am grateful to the noble Lord for admitting the force of these arguments, and I will, if I may, seek to show that his arguments, as I understand them, rested on an omission in his reading of the Amendment. At one point he talked about it being often the case that seamen would not be paid the full amount due to them, or about their account not being presented when they leave the ship; and he said that there would not often be a precise calculation made of what is due to them. This is not the case. My Amendment is designed to meet the circumstances when it is only the master who can prepare the accounts. I agree with the noble Lord that if a ship is large enough there will be officers, such as pursers, who will prepare the accounts to date as the ship comes to harbour, and that none of these problems then arises. My concern is with cases where, if accounts are to be done, it is only the master who can do them. In those circumstances, when he is faced with difficult pilotage and bad weather, it will not be practicable for him to prepare these accounts. My Amendment specifically includes the words, "If… it is not practicable "
With these penalties hanging over them, the owners are not going to incur the
extra expense of having to meet the penal-ties by not paying the full amount due if they can possibly do it. We are now legislating for a very rare occurrence; but, as the noble Lord, Lord Pearson, pointed out, it will not be right to place upon the owner an absolutely straight obligation to prepare full and accurate accounts for every member of the crew in all circumstances. Therefore we need to have a subsection (2) which meets these exceptional circumstances. I believe that the proposals contained in my Amendment are the straightforward and equitable way of doing this, and I am afraid that I have no alternative but to press my Amendment.
LORD HAWKE: Before the Minister rejects it outright, I hope that he will take it back and consult with his advisers on these words, "If… it is not practicable". It seems to me that they represent a complete and utter let-out from the cases that the Minister has been putting forward. One can well imagine that the National Union of Seamen are going to fight very hard indeed any case which cannot easily be proved to be " not practicable". I feel that my noble friend really has common sense and practice on his side against the theory of the noble Lord opposite.
LORD BROWN: I am not allowed to speak twice; but I can say that I Have already fully consulted with the officials, the legal authorities and the Board on this point.
5.14 p.m.
On Question, Whether Amendment No. 1 shall be agreed to?
Their Lordships divided: Contents, 78; Not-Contents, 47.

CONTENTS

Aberdare, L

Berkeley, Bs.

Daventry, V.

Ailwyn, L.

Bessborough, E.

Denham, L.[Teller.]

Airedale, L.

Bethell, L.

Derwent, L.

Aldenham, L.

Brecon, L.

Drumalbyn, L.

Alexander of Tunis, E.

Brooke of Cumnor, L.

Dudley, E.

Allerton, L.

Brooke of Ystradfellte, Bs.

Dundee, E.

Alport, L.

Brougham and Vaux, L.

Elgin and Kincardine, E.

Ampthill, L.

Byers, L.

Elliot of Harwood, Bs.

Amulree, L.

Carnock, L.

Emmet of Amberley, Bs.

Atholl, D.

Cork and Orrery, E.

Falkland, V.

Auckland, L.

Cottesloe, L.

Ferrier, L.

Barnby, L.

Craigavon, V.

Forescue, E.

Belstead, L.

Craigmyle, L.

Goschen, V.[Teller.]

Gray, L.

Mancroft, L.

Sandford, L.

Grenfell, L.

Massereene and Ferrard, V.

Sandys, L.

Grimston of Westbury, L.

Milverton, L.

Sempill, Ly.

Hanworth, V.

Molson, L.

Somers, L.

Hawke, L.

Monckton of Brenchley, V.

Stonehaven, V.

Hylton-Foster, Bs.

Mowbray and Stourton, L.

Strathcarron, L.

Ilford, L.

Napier and Ettrick, L.

Strathclyde, L.

Inglewood, L.

Nugent of Guildford, L.

Teviot, L.

Killearn, L.

Polwarth, L.

Thurlow, L.

Kilmany, L.

Rankeillour, L.

Tweedsmuir, L.

Lauderdale. E.

Robertson of Oakridge, L.

Vivian, L.

Lucas of Chilworth, L.

Runciman of Doxford, V.

Wakefield of Kendal, L.

McCorquodale of Newton, L.

St. Aldwyn, E.

Wolverton, L.

NOT-CONTENTS

Archibald, L.

Jacques, L.

St. Davids, V.

Ardwick, L.

Leatherland, L.

Segal, L.

Beswick, L.

Lindgren, L.

Shackleton, L. (L. Privy Seal.)

Bowles, L. [Teller.]

Llewelyn-Davies, L.

Sorensen, L.

Brockway, L.

Llewelyn-Davies of Hastoe, Bs.[Teller]

Southwark, L.Bp.

Brown, L.

Stocks, Bs.

Citrine, L.

Longford, E.

Strabolgi, L.

Collison, L.

Milner of Leeds, L.

Summerskill, Bs.

Delacourt-Smith, L.

Morrison, L.

Walston, L.

Donaldson of Kingsbridge, L.

Moyle, L.

Willis, L.

Douglass of Cleveland, L.

Nunburnholme, L.

Wilson of Langside, L.

Evans of Hungershall, L.

Phillips, Bs.

Winterbottom, L.

Gardiner, L. (L. Chancellor.)

Plummer, Bs.

Wise, L.

Garnsworthy, L.

Raglan, L.

Wootton of Abinger, Bs.

Hilton of Upton, L.

Ritchie-Calder, L.

Wynne-Jones, L.

Hughes, L.

Sainsbury, L.

Younger of Leckie, V.

On Question, Amendment agreed to.

Resolved in the affirmative, and Amendment agreed to accordingly.
5.26 p.m.
LORD BROWN LORD BROWN moved Amendment No. 2:
Page 5, line 9, leave out ("within seven days of his discharge") and insert ("at the time at which it is so payable ").
The noble Lord said: My Lords, you will recall the discussion in Committee on Amendment No. 6 which resulted in subsection (3) of Clause 7 being amended to
its present form. In our previous discussion I suggested that the Amendment would have the effect of enabling the shipowner to fail to pay the seaman anything at all on discharge, and without penalty. No-one wished that situation to be created but I was unable to show your Lordships why this was so at the time. Now that we have the text in its amended form it is easier to show the effect. I therefore introduce this Amendment, as I assume that your Lordships would not wish to proceed with the clause in its present form in these circumstances.
Subsection (3) as amended at the Committee stage provides that the penalties apply if any amount which, under the preceding provisions of this clause, is 898
payable to a seaman is not paid within seven days. It follows that the penalties do not apply if payment is made within seven clays. Both payment in full, where practicable, and the amount of £50 or one-quarter in subsection (2) are such payments; and the clause as now drafted thus means that there will be no penalty so long as such payments are made within seven days. In other words, they need not be made for seven days because no penalty would be attracted until then.
I suggest that the clause as it stands at the moment makes a nonsense of the Pearson Report in this respect, because I do not think that, if the point had arisen then, the Report would have accepted that this situation should obtain. I think it is clear by implication that it was the recommendation of that body —although I admit that they have not said so in writing —that the maximum proportion of a seaman's wages should be paid to him on discharge. In so far as the clause would permit irresponsible shipowners to avoid doing that without penalty, I think (hat the Amendment is justified, and I hope that noble Lords will accept it. I beg to move.
LORD SANDFORD: My Lords, I am sure the House will be grateful to the noble Lord, Lord Brown, for that

899
explanation. He has shown that the Amendment which I proposed at Committee
stage is defective, and I shall be glad to accept his counter-Amendment. The Amendment was one among three safeguards which we sought to insert into the Bill to ensure that if we are to have these heavy penalties of wages running on they operate fairly. We have not succeeded in convincing the Government about any of our Amendments, and I do not wish to press this particular point, especially as the wording we succeeded in achieving in our Amendment has been shown to be defective.
LORD SANDFORD: My Lords, this Amendment and the two subsequent Amendments are consequential on Amendment No. 1. I beg
to move Amendment No. 3.
Amendment moved —
Page 6, line 1, leave out subsections (2) and (3) and insert —
("(2) The account shall be delivered not later than the time at which the balance of wages is payable to the seaman."). —(Lord Sandford.)
LORD BROWN: My Lords, I cannot prevail against the built-in majority of noble Lords opposite. It would be churlish to contest this Amendment and the following two Amendments, because they are part of the scheme of restructuring Clause 7 envisaged in Amendment No. 1.
LORD HAWKE: My Lords, before the noble Lord sits down, may I remind him that he has a potential voting strength of something like 110, which I have seen mustered opposite. He can hardly call 76 a built-in majority.
LORD BROWN: My Lords, may I remind the noble Lord that if we issue a three-line Whip, the other side can easily produce a good many more than 110. I think that that is a somewhat ungenerous remark, in view of the fact that there is a built-in majority.
Clause 9 [Regulations relating to wages and accounts]:
LORD SANDFORD: My Lords, I beg to move Amendment No. 4.
Amendment moved —
Page 6, leave out line 43. —(Lord Sandford.)
LORD BROWN: My Lords, I am not going to object to this Amendment on the same ground as on the previous Amendment.
LORD SANDFORD: My Lords, I beg to move Amendment No. 5.
Amendment moved —
Page 6, line 43, at end insert —(" (f) varying the amounts referred to in subsection (2) of section 7 of this Act.") —(Lord Sandford.)
LORD BROWN: My Lords, I accept this Amendment on the same ground as the two previous Amendments.
Clause 12 [Power of Court to award interest on wages due otherwise than under new agreement]:
LORD SANDFORD LORD SANDFORD moved Amendment No. 6:
Page 7, line 39, after ("due") insert ("to a mistake.")
The noble Lord said: My Lords, on Committee stage we had a discussion on a similar point in Clause 7(4), raised by the noble Lord, Lord Pearson, on Second Reading and tackled by two Amendments, one by the noble Lord, Lord Brown, and the other by myself. The noble Lord's Amendment was, I think properly, accepted and I did not move my own, but the same persuasive arguments put forward by the noble Lord in support of his Amendment to Clause 7(4) apply, it seems to me, with equal cogency, to Clause 12. As the noble Lord has not moved an Amendment, I have presumed to do it for him. I hope that he will agree with me. I beg to move.
LORD BROWN: My Lords, I appreciate the intention of the noble Lord in moving this Amendment, in view of the similar Amendment, to which he referred, which I moved on Committee stage. Although I think that in this clause, where we are dealing with the discretion of the courts in making an order, there is less likelihood of "or to any other cause" in line 41 being interpreted as not including a mistake, nevertheless I agree that the matter ought to

901
be made absolutely clear. Therefore I am prepared to recommend your Lord-ships to accept this Amendment.
Clause 26 [Expenses of medical treatment, etc., during voyage]:
5.36 p.m.
LORD SANDFORD LORD SANDFORD moved Amendment No. 7:
Page 16, line 28, leave out from second ("Kingdom") to end of line 29 and insert ("such surgical, medical, dental or optical treatment")
The noble Lord said: My Lords, this Amendment returns to a point which was raised by my noble friend Lord Hawke on Committee stage (OFFICIAL REPORT, col. 181) to ensure that treatment only for conditions that impair efficiency should be covered by this clause. He was talking about the possibility of a seaman going off at some foreign port and getting an expensive set of false teeth which he could get in the United Kingdom without any charge to the owners. I think that particular point is already adequately met by the clause as drafted. The owners are spared the liability of paying for false teeth or spectacles if a member of a crew decides to get a natty new set in New York and they are not strictly necessary for efficiency. A safeguard of this kind is needed, but on closer inspection I think that the provision needs to be widened, and this is what my Amendment seeks to do.
If what is in the clause is reasonable, it is equally reasonable, it seems to me, that if a member of a crew who has, for instance, some trouble with varicose veins but is nevertheless passed fit for service at sea elects to have them dealt with in New York the additional un-necessary burden of cost should not fall upon the owners. They should not have to foot the bill. Therefore, unless the proviso "as cannot be postponed without impairing efficiency", still in the clause, is made to apply to all four forms of treatment —medical, surgical, dental and optical —instead of only to the last two, as it does at the moment, I think that the owners' liability will be unreasonably wide, as my noble friend Lord Hawke sought to show on Committee stage.
LORD BROWN: My Lords, the noble Lord, Lord Sandford, has seen fit, in

902
speaking to this Amendment, to refer to the noble Lord, Lord Hawke. I believe that in the Amendment that follows this one I have met the point of the noble Lord, Lord Hawke, more easily than this Amendment does. I suggest an alteration of the Bill that would lay upon employers only the reasonable costs of all forms of treatment. However, I am bound to deal now with this Amendment. The object is to provide that the only treatment for which an employer would be liable is treatment which cannot be postponed without impairing efficiency. 1 can understand the motives behind the Amendment, but I consider that it would be most unfortunate if a seaman who felt ill or believed himself to be ill should be denied medical treatment because it was judged that this treatment or consultation could be postponed to a later date without impairing his efficiency.
The fact that the man feels ill, or says that he is ill. means in one sense that he is ill. There has never in the past been any suggestion that the owners' liability was too wide and, apart from the limitations in Section 34 of the 1906 Act, illness and injury have been treated in a responsible and generous manner by ship-owners. I do not think that we should now introduce any limitation which might cause someone to be deprived of treatment merely on the ground that his efficiency as a seaman would not be affected.
We have of course introduced this limitation in the case of dental or optical treatment, where there are clear opportunities for abuse, but I think that it would be unwise, for the reasons I have given, to extend it into the general field of medical treatment. The matter is well within the control of the master and agent. Shore medical facilities are not usually offered extravagantly to seamen without reference to somebody who is in a position to pay. It is true that Clause 26 extends the employers' responsibilities beyond those in the 1906 Act to include injuries incurred "not in the service of the ship". These will usually be injuries incurred ashore, but not all injuries incurred ashore have been excluded and there is no new factor here of which the employers have not had previous experience. The amount at present paid out in respect of such injuries is about £5,000 a year. In the light of this explanation

903
and the following Amendment which I propose to move, I would ask the noble Lord to withdraw the Amendment.
LORD SANDFORD: I am grateful to the noble Lord for making those points, and I must admit that there is a certain amount of force in them. I do not think that the owners would want to see this Bill amended in such a way as to intro-duce harshness of the kind which the noble Lord, perhaps rightly, fears might be introduced if the Amendment was pressed. I agree also that it will be possible to meet some of the points that I made in the way that the noble Lord seeks to meet them in his Amendment, No. 8. Therefore I beg leave to with-draw the Amendment.
Amendment, by leave, withdrawn.
LORD BROWN LORD BROWN moved Amendment No. 8:
Page 16, line 31, after ("the") insert (" reasonable ").
The noble Lord said: My Lords, I am grateful to the noble Lord, Lord Hawke, for raising the issue of the possible irresponsible use of the rights of seamen included in this clause, and in order to deal with the point he raised I am now proposing that the reference to the costs which the employer has to bear should be conditioned by the word "reasonable". In other words, the employer will be liable only for reasonable costs, and if there is a dispute about them, then the court will have to settle it. It will give the master of the ship the opportunity of saying to a seaman or other member of the crew who wishes to go ashore and get medical treatment, that the employer will pay only if the costs incurred are reasonable, and that he had better watch his step and not do anything extravagant. In the light of this information, I hope that noble Lords will see fit to accept this Amendment. I beg to move.
LORD HAWKE: My Lords, I thank the noble Lord for meeting this point. I would have preferred that the word "reasonable" should qualify the action rather than the expenses. The clause as drafted is an absolute lawyers' picnic, and I do not feel capable of arguing to that degree. One must be thankful for what the noble Lord has provided. It
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would be interesting to know what the position would be supposing the seaman in question goes on what is an unreason-able trip. For instance, he might buy a hearing aid in the United States which is much better than he can get under the National Health Service in this country. Would that be an unreasonable expense or an unreasonable action? No doubt he would claim that he would be a more efficient seaman with the American hearing aid than with the hearing aid provided under the National Health Service. That is what I mean when I say that this clause is a lawyers' picnic. I do not think that it is likely to be brought into operation very often, and I accept what the noble Lord has provided and thank him for it.
LORD SANDFORD LORD SANDFORD moved Amendment No. 9:
Page 16, line 35, at end insert —
("Provided that —

(i) the liability of those persons shall be conditional upon the person so employed or his legal personal representatives affording to those persons every facility to prosecute in his name any claim in respect of such expenses and allowing them reason-able discretion in the conduct of any proceedings or the settlement of any claim in respect of such expenses and to the extent of such conditional liability, surrendering to them all rights in respect of such claim;

(ii) nothing contained in this section shall prejudice any right of recovery of such expenses from a person other than a person so employed.")

The noble Lord said: My Lords, sweet reasonableness is coming in from all sides, and I hope that it will not land the courts with undue trouble. I am pro-posing to insert the word "reasonable" here in a redraft of an Amendment that I put down on the Committee stage. I withdrew that Amendment after the noble Lord, Lord Brown, had pointed out that my first effort was too widely drawn and would enable an employer to exhaust too much of the seaman's total rights to claim damages and compensation on his own behalf. I hope that the Amendment as redrafted makes it clear that the employer's interest and concern in this matter is directed to the recovery of the expenses that he has incurred for the medical treatment of his crew member, and that it does not exhaust the other rights of the member of the crew

905
in other aspects of any claim that he might be wishing to lodge.
The noble and learned Lord, Lord Pearson, who helped us in Committee with this rather difficult matter, pointed out that it will only be possible for one action for damages or compensation to be taken. Therefore, if my Amendment finds favour with the Committee, I think it would have to recognise that before any action is taken there will have to be some sort of understanding between the employer and the seaman. Such an understanding might be covered by the terms of some form, the details of which could be negotiated on the National Maritime Board, and could be available for the master, on behalf of the owners, and the seaman to sign, indicating precisely in each particular case where the line is drawn between the two parties in the action. The proposals that I am making here must envisage that something like that can be done, and I am advised that it will be possible on the National Maritime Board to negotiate an agreement of that sort. I beg to move.
LORD BROWN: My Lords, I appreciate that the noble Lord has limited the original Amendment that he moved in Committee and that his present Amendment refers only to "reasonable discretion" instead of "full discretion", and that it now refers to discretion in the settlement of medical expenses instead of any claim. Although this is intended to meet one of my objections to the previous Amendment, I think there is a more fundamental objection to the Amendment. It still makes the employer's liability to meet medical expenses conditional upon the employee's co-operation. That, I take it,
is the real purpose of the Amendment. It will not arise, apparently, unless the conditions are satisfied. This we say is wrong in principle.
Furthermore, for reasons that I will explain, I think that a provision in the Bill to require this co-operation is both unnecessary and of little use. There are two basic situations in which an employer might wish to seek re-imbursement where he had paid the medical expenses of a seaman who had been injured by the wrongful act of a third party abroad. First, there is the case where the seaman himself sues the
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third party and seeks to recover dam-ages. It appears to us that, subject to any provision of foreign law to the contrary, he would not be able to have his medical expenses included in those damages as he would not have suffered any loss in respect of them. There would thus normally be no question of the employer being reimbursed in the seaman's action or out of damages received by the seaman. Secondly, there is the case where, assuming the foreign law allows it, the employer wishes to sue the foreign wrongdoer for the medical expenses incurred in his injuring the seaman. This is the case with which we are really concerned here. The co-operation required of the seaman would therefore amount to no more than the giving of evidence in any proceedings the employer might bring. His co-operation in this way could, if necessary (if the proceedings were in the United Kingdom) be compelled by subpoena and if they were abroad his evidence could be taken on commission. I consider, therefore, that any statutory duty imposed in whatever terms on the seaman by United Kingdom law would be of limited value, and would really be little more than propaganda.
With regard to the second proviso, there is nothing in the clause which could
prejudice any right of recovery from third parties and such a proviso would not assist the parties. Cases of this type will, for the most part, arise abroad and the proviso could have little or no effect on the rules applied in a foreign court. I fully appreciate that a provision for co-operation is attractive in theory. Indeed, because of its attraction I personally have spent a lot of time with officials discussing this clause. It has received a great deal of attention, but I do not think that it is necessary or appropriate in this Bill. If it were felt that, nevertheless, there should be some provision compelling the seaman's co-operation, I still think that the right remedy would be for an appropriate pro-vision to be inserted in the contract of employment.
I know that the noble Lord has voiced objections to that course, because he has raised the point that the seaman's negotiators might refuse to have it so included. In response to that, I would say that it is not a very contentious point. Reasonable common sense would

907
force its inclusion in the terms of con-tract. If this was refused, it would be a proper subject for discussion in the Maritime Board. I do not believe, after examination, that there is likely to be a great deal of resistance to that appearing in a contract. Matters of detail, in which account could be taken of the laws of the particular countries likely to be concerned, the ships concerned in specific cases, and such matters as the payment of the seaman's expenses—for instance, in coming from Singapore to give evidence in New York—and his expenses while attending at the court, perhaps even as to keeping his job open afterwards, could be settled by negotiation and agreement. These are not matters, with great respect, for this Bill. It would make for a very complex clause. For all these reasons, I cannot advise your Lordships to accept this Amendment.
While I am on my feet, perhaps I should deal with the point raised by the noble Lord, Lord Pearson. The noble and learned Lord posed the more limited question in Committee; namely, whether something could be put into the clause to keep open the possibility of employers being able to require some reasonable contractual provision to be inserted in the contract to meet this point. I under-took to look at this matter. Although the noble Lord is not here, I think I ought to give this explanation. I have now reconsidered this matter most carefully and I am satisfied that it would not be possible to produce a statutory provision which would be of substantial assistance for the purpose we have in mind. It seems to me that there is some danger of implying that, when such a provision is not included in other con-texts in this Bill, contractual provisions affecting the ultimate liability of the parties (such as we have in mind as being possible in relation to relief and repatriation under Clause 62) would not be possible. This is now a dangerous consequence. A provision which would follow literally the line suggested by the noble and learned Lord, Lord Pearson, does not really seem practicable. It would involve the proposition that any contract should contain provisions reasonably required by the employer. That cannot really be put into a Bill.
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It might mean a whole host of law cases. It is a matter of negotiation and not reasonable requirements of the employer. This leads to the problem of how such a provision could be enforced. To say that seamen (and possibly the State) should not have the benefit of the clause at all, unless there were a provision for recoveries in his contract, would be too severe. Anything else I think would be ineffective.
I have taken a long time to comment on this clause, because we have given a great deal of consideration to it. I hope that in the light of this rather long explanation of our attitude the noble Lord will see that this matter is rather too complicated to put into a Bill, and that it ought to be left to negotiation between the seamen's representatives and the employers, and put into the contract.
LORD SANDFORD: My Lords, the House will be grateful to the noble Lord for giving such full explanation of the difficulties of this matter, and for having given it such full consideration since the last stage. I should be the first to agree with him that there are matters here of such detail and complexity, when one bears in mind that we are dealing with legislation in other countries (and this is likely to apply more abroad than at home), that they ought to be left to regulations, a contract or articles of agreement and negotiation on the National Maritime Board. I accept that. But I return to the main point which I made at the Committee stage, in which I believe I was supported by the noble Lord, Lord Pearson; namely, if this is to be done, what goes into the Bill must be balanced, fair and equitable as between the employers and the seamen.
What has happened so far is that there has been a very considerable and generous extension of liability on the part of the owners extending to the injury and the difficulty into which the seaman gets when ashore abroad, whereas it was previously limited to injury incurred on duty aboard. At the moment there is no countervailing limitation to this liability. My Amendment seeks to give more balance in the Bill to the frame under which the further and more detailed negotiation must be undertaken. To leave the clause as it is now, and to say that the counterpart to this, limiting

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the liability of the owners, must go somewhere else, in some lesser piece of legislation, will produce inequity and imbalance which cannot be accepted. Therefore, my advice to the House is to support me in this Amendment.
Resolved in the affirmative, and Amendment agreed to accordingly.
Clause 28 [Drunkenness, etc. on duty]:
6.6 p.m.
LORD MILFORD LORD MILFORD moved Amendment No. 10:
Page 17, line 13, at beginning insert ("The Board of Trade may make regulations that").
The noble Lord said: My Lords, may I take Amendments Nos. 10, 11, 12 and 13 together? I am sorry I am once again taking up the time of the House on these penal clauses, but all enthusiasm towards this otherwise very good Bill will be dissipated unless everything possible is done to make these penal clauses less repellent
5.57 p.m.
On Question, Whether the said Amendment (No. 9) shall be agreed to?
Their Lordships divided: Contents, 58; Not-Contents, 50.

CONTENTS

Aberdare, L.

Denham, L. [Teller.]

Milverton, L.

Ailwyn, L.

Derwent, L.

Molson, L.

Alexander of Tunis, E.

Drumalbyn, L.

Monckton of Brenchley, V.

Allerton, L.

Dudley, E.

Mowbray and Stourton, L.

Ampthill, L.

Elgin and Kincardine, E.

Napier and Ettrick, L.

Atholl, D.

Elliot of Harwood, Bs.

Polwarth, L.

Auckland, L.

Emmet of Amberley, Bs.

Rankeillour, L.

Barnby, L.

Falkland, V.

Runciman of Doxford, V.

Belstead, L.

Ferrier, L.

St. Aldwyn, E.

Berkeley, Bs.

Goschen, V. [Teller.]

Sandford, L.

Bessborough, E.

Gray, L.

Sandys, L.

Bethell, L.

Gridley, L.

Sempill, Ly.

Bourne, L.

Grimston of Westbury, L.

Somers, L.

Brecon, L.

Hawke, L.

Stonehaven, V.

Brooke of Cumnor, L.

Ilford, L.

Strathclyde, L.

Brooke of Ystradfellte, Bs.

Inglewood, L.

Teviot, L.

Cork and Orrery, E.

Killearn, L.

Thurlow, L.

Cottesloe, L.

Kilmany, L.

Tweedsmuir, L.

Craigavon, V.

Lauderdale, E.

Vivian, L.

Craigmyle, L.

NOT-CONTENTS

Ardwick, L.

Hughes, L.

Raglan, L.

Beswick, L.

Hylton-Foster, Bs.

Ritchie-Calder, L.

Bowles, L.

Jacques, L.

Robertson of Oakridge, L.

Brockway, L.

Leatherland, L.

Sainsbury, L.

Brougham and Vaux, L.

Lindgren, L.

St. Davids, V.

Brown, L.

Llewelyn-Davies, L.

Shackleton, L.(L. Privy Seal.)

Carnock, L.

Llewelyn-Davies of Hastoe, Bs.

Sorensen, L.

Chalfont, L.

Longford, E.

Stamp, L.

Collison, L.

Lucas of Chilworth, L.

Stocks, Bs.

Delacourt-Smith, L.

Milford, L.

Strabolgi, L.

Evans of Hungershall, L.

Milner of Leeds, L.

Walston, L.

Gardiner, L.(L. Chancellor.)

Morrison, L.

Willis, L.

Garnsworthy, L.

Moyle, L.

Winterbottom, L.

Hankey, L.

Nunburnholme, L.

Wootton of Abinger, Bs.

Hanworth, V.

O'Hagan, L.

Wynne-Jones, L.

Henley, L.

Phillips, Bs. [Teller.]

Younger of Leckie, V.

Hilton of Upton, L. [Teller.]

Plummer, Bs.

to the seamen. I thank the noble Lord the Minister for the concession he made in the Committee stage of this Bill, when he said that these clauses would be reviewed—I think he said, "at three years". But the National Union of Seamen—and it is understandable when one considers how long they have had to wait for the scrapping of the 1894 Act—do not feel 100 per cent. satisfied. Also, it does not remove the stigma under which they feel they are in being an exception to the withdrawal of the proposals in In Place of Strife. An Act can take a very long time to be amended.
So I am proposing that these penal clauses are made into regulations under the Board of Trade, because this would

911
make it far easier for them to be removed than if they were embodied in the Bill. In putting forward this suggestion I am not asking for enormous alterations to the Bill. The Bill already makes provisions whereby the Board of Trade can make regulations. I am only asking that these penal clauses should be made part of those regulations. Then it would be up to the industry itself to demonstrate that some, or all, of these dangerous bones of contention are not in fact necessary.
My Amendment is not concerned with safety at sea. Of course strong provisions for safety are, and always will be, absolutely necessary. I am concerned only with the question of industrial discipline and industrial relationship. I feel that discontent, grievances born of such penal clauses as these, incorporated in an Act of Parliament, could lead to a dangerous situation at sea. Would such regulations as I propose, drawn up in consultation with representatives of the men and officers, lead to more insubordination on board a ship?
LORD BROWN: My Lords, I am very happy to accept that we are discussing four Amendments rather than simply Amendment No. 10 alone. I want to give a rather lengthy reply to the noble Lord, who put his points in reasonable terms. There has been much discussion about these clauses and I think the more information there is about the reason for them, the better. I will start by reciting some of the provisions that apply in other industries where acts of misconduct are likely to cause danger, not merely to the persons misconducting themselves but also to members of the public and to other persons. In these cases we find criminal prohibitions of a similar nature, and I want to recite some of the fields in which they occur.
Take, for example, the field of transport, to which merchant shipping is obviously related. First, air. In the field of aviation it is not only an offence wilfully or negligently to act in a manner likely to endanger an aircraft or any person therein; it is also an offence for any person to enter any aircraft when drunk, or to be drunk in any aircraft; for any crew member to be under the influence of drink or drugs to such an extent as to impair his capacity; for any
912
person to disobey lawful commands of the commander of the aircraft relating to the safety of the aircraft or persons or property in it, or relating to the safety, efficiency or regularity of air navigation. The penalties range up to £200, six months' imprisonment, and so on.
If we turn to the roads, I need not elaborate on the offence of drunkenness on the road. If we turn to the rail, it is an offence for any driver, guard, porter or other servant to be found drunk while employed upon the railway; to offend against the railway bylaws, rules or regulations, or wilfully, maliciously or negligently to do or omit to do any act whereby the life or limb of a person might be injured or endangered, or the passenger trains might be obstructed or impeded. The offence is punishable by up to two months imprisonment or a fine of £10 on summary conviction, or up to two years' imprisonment on indictment. That is under the Railways Regulation Act of 1848.
In the case of the mines, it is an offence under the Mines & Quarries Act 1954 for any employee to contravene any directions given by the owner or manager of the mine or any rule made by the manager regulating the conduct of mining employees for securing compliance with the Act or orders or rules thereunder. It is an offence for any person negligently or wilfully to do or omit to do anything likely to affect the safety of the mine or the safety or health of persons at the mine; and the penalties in some cases go up to £200.
In short, there is a great deal of legislation that is concerned with safety and which is very similar in its provisions and its effects to the clauses to which the noble Lord has objections. I think we have to face up to the question of safety and quite boldly say that these provisions are necessary. Most other maritime countries have similar provisions with, in general, more severe penalties: Denmark, the Netherlands, Norway, Sweden, Germany and France all have statutory offences covering disobedience, neglect of duty, absence without leave and desertion, as well as the endangering of the ship. In most cases the penalty may be imprisonment as an alternative to a fine. In the case of Denmark, Norway, Sweden, France, Japan and Greece impairment of capacity

913
due to drink or drugs is an offence with a penalty of a fine. What we are pro-posing is therefore reflected in all important maritime countries and is, in general, much less onerous.
Although I am not experienced in the shipping world I am by now very familiar with the pro and con of these clauses. There is the assurance that in three years' time the matter will be reviewed and if a consensus emerges in the industry itself, leading to an approach to the Government, we have undertaken to review the clauses. In the light of what I have said and the arguments I put forward on Committee stage, and which I do not think the noble Lord would wish me to repeat in full now, I think the Amendments should be rejected and the clauses, in the interests of safety, should remain as they are now written. There-fore I would ask the House to reject these Amendments.
LORD MILFORD: My Lords, I should like to thank the noble Lord for his answer to my question, and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 52 [Inquiry into fitness or conduct of officer]:
6.15 p.m.
LORD SANDFORD LORD SANDFORD moved Amendment No. 14:
Page 25, line 35, at end insert—
(" (6) Where the certificate of any officer is suspended pursuant to subsection (1) of this section and such suspension is subsequently terminated either under subsection (2) of this section or pursuant to the findings of any inquiry held under subsection (1) of this section, the court, upon the application of the officer, or the persons holding the inquiry, may order that compensation be paid to any such officer for any expenses or loss of earnings which he may have incurred, or such part thereof as the court or the persons holding the inquiry shall determine, and the decision of the court on such an application shall be final.")
The noble Lord said: My Lords, this matter of what should be done when the certificate of an officer is suspended in advance of an inquiry was dealt with extensively by the Committee headed by the noble Lord, Lord Pearson, and the relevant recommendation that he made was:
"We think that the only remedy is for the court to have a discretionary power to order
914
in a suitable case that the Board of Trade do indemnify the officer in respect of his loss of earnings."
That is to say, when the officer in question is found by the court of inquiry to be innocent of any offence. I raised the point in Committee on the Question whether the clause should stand part of the Bill, in order to get the reaction of the noble Lord, Lord Brown, and he was kind enough to give it to me in cols. 207 and 208 of the OFFICIAL REPORT. But that did not go any further than the answer given by his colleague in another place. Therefore I thought it necessary to table this Amendment in order to secure a further discussion of this important matter.
The point I should like to make is that everyone appreciates, I believe, that it is not possible to award compensation generally as of right for loss of earnings, or any other loss, to each and every person who gets caught up in inquiries or in litigation. But, contrary to the noble Lord, Lord Brown, I submit that to say that this Amendment would start a precedent of that kind is quite un-reasonable. If it did, the Amendment would indeed be quite unacceptable. I submit that it does not create such a precedent, or indeed any precedent, because the provision contained in this Amendment follows closely the recommendation of the noble Lord, Lord Pearson, and it cannot conceivably be of any general application. What is being conferred on the court, as recommended by the noble Lord, Lord Pearson, is discretion in a particular case—not in every case or under general conditions, but in a particular case—if it sees fit, to order the Board of Trade to indemnify a particular officer who is under inquiry and suspended but subsequently found to be innocent.
If such a provision is not inserted in the Bill at this point I cannot see what redress such an officer would have if, in the event, it was found that owing to some dreadful mistake of the Board of Trade he had been wrongly brought to the inquiry, deprived of any possibility of earning his living for a prolonged period and, in the end, found innocent of any blame. If the noble Lord can assure us that in such a case there would be redress of some other kind, obtained in

915
some other way, I shall be relieved, and I think the whole House will be relieved, to hear about it. Otherwise I am inclined to think that this Amendment will be needed, and clearly the noble Lord, Lord Pearson, thought so too, as a proper and a necessary protection of the individual citizen against the misuse or mistaken use of power by the Executive. I beg to move.
LORD HAWKE: My Lords, the category of officers who have their certificate suspended is not dissimilar from that of people who are arrested for an offence of which they are afterwards acquitted. People can suffer very grave injustice indeed for that reason, and I do not know what the remedies are. I believe that there are some remedies, and at any rate in defending themselves they at least can get legal aid if they cannot afford to pay. I am not sure whether these officers would get legal aid or not. Perhaps the noble Lord, when he comes to reply, could tell me. I can well understand that behind the scenes any inclination the Board of Trade may have to accept an Amendment of this sort would be fought to the last ditch by the Treasury, who, true to form, always imagine the repercussions of any decision on one matter applying to many others in different spheres of life. There is no question about it that in my noble friend's Amendment there is justice, and it would be rather nice if this House could for once put justice into a Bill in defiance of the Treasury. Let us do that to-night and make history.
LORD BROWN: My Lords, the noble Lord, Lord Sandford, suggests that if this Amendment were carried no precedents would be created. Our minds simply are not meeting on this point. I am advised that it is against the currently operating principles of our legal system that a person who is put in jeopardy by reason of his conduct being the subject of a judicial injuiry should be compensated for his loss of earnings if he is subsequently discharged as innocent. We have all known this feeling of injustice over this question. As I stand here, I think it is unjust that this is the general way in which these cases are dealt with in our society. But we really cannot tackle an enormous issue like this, which is no doubt to the officer concerned very
916
important but in the context of the general law a trivial issue, by amending a general principle in this clause out of the blue.
To-day, a person charged with a criminal offence may be suspended from his employment pending trial. He may-be put to the considerable inconvenience of finding bail; he may be remanded in custody. If he is acquitted, he may be awarded costs against the prosecution, but there is no question of being awarded compensation for his loss of earnings, or for inconvenience, or for the loss of reputation amongst his friends that he may have suffered. There is provision for the Crown—not the court, but the Crown —to decide on an ex gratia payment, which is not very often exercised. If we pass this Amendment it will certainly create a precedent. It will be quoted on Bill after Bill as a precedent. It is not a Party political matter; it is not a matter of the Treasury. It is a matter of saying that the courts in every case would have to come to a conclusion as to what precise sum should be paid in these circum-stances. They have no means of deciding what the liquidated sum should be. It is an immense proposition in the implications of the precedent that would be set by this Amendment.
Finally, may I produce what I think may be a convincing argument to your Lordships. We have searched the records, and there is, so far as we can go back, not a single case of an officer whose certificate has been suspended who has been subsequently acquitted; not a single case can we find. This means to say, as I assured noble Lords at Committee stage, that the Board of Trade only exercise their right of suspension after the most critical examination and in circumstances where really it is patently clear that it is dangerous to let this officer go on operating in his normal capacity and there is very strong prima facie evidence that he is guilty of whatever charge is brought against him to cause the suspension. In the light of the fact that that is the record of the use of these powers in the past; the fact that it would certainly create a very important precedent, and also that this is not the Bill, in this relatively unimportant clause, to do that, I would advise your Lordships to reject the Amendment.
LORD HAWKE: My Lords, can the noble Lord answer my point about legal

917
aid, because that is not creating an enormous precedent.
LORD BROWN: My Lords, I have been hoping for a little note to come to me from the Box, but I have not got one.
LORD HAWKE: My Lords, I cannot speak again, but if somebody else will say something, we can play out time.
LORD BROWN: My Lords, the answer is that we do not think that legal aid would cover this case. I am sorry to have to say that. I will look into the question and make quite certain of it and perhaps say something more positive on Third Reading. But as I understand it at the moment, I do not believe that legal aid is available to such officers.
LORD SANDFORD: My Lords, I would indeed be much impressed, if not convinced, by what the noble Lord, Lord Brown, has said about the fact that this would have to apply to court cases and to people involved in court cases, if an authority as great as the noble and learned Lord, Lord Pearson, who must be far more familiar with this point than either the noble Lord, Lord Brown, or myself, had not, in spite of this argument, made the recommendation that he has made.
LORD BROWN: My Lords, if I may quote the noble Lord, Lord Pearson, he finished his contribution to our last debate by saying:
"I would not think it right to press it further because I think it is outside my sphere and in the sphere of a different expertise."— [OFFICIAL REPORT, 8/4/70, col. 208.]
In the light of that, I beg noble Lords not to quote the noble and learned Lord, Lord Pearson, on this issue.
LORD SANDFORD: My Lords, I am quoting him to the extent that, knowing all the facts that the noble Lord, Lord Brown, has deployed—which he could not fail to know—he nevertheless made the recommendation he did. I can understand the noble and learned Lord's wish not to press the matter from his point of view, but that does not limit us on this side in pressing it if we so see fit. I am really not convinced by the argument that this creates a precedent, for the very reason that the power being conferred is a discretionary power of a court to do something in a particular
918
case. It is not altogether helpful to draw an analogy with the situation which prevails in the case of what goes on in the criminal courts. This is not a criminal court, this is a court of inquiry. An officer's certificate can be suspended by the Board of Trade in circumstances which are far short of the circumstances in which a man can be arrested and deprived of his earnings by the fact that he is in prison and not granted bail. These are the circumstances which prompt me to wish very much to press this Amendment to a Division, but in the circumstances I will withdraw it now and reserve the right to put it forward again at Third Reading, after I have considered what the noble Lord has said. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 64 [Recovery of expenses incurred for relief and return, etc.]:
6.29 p.m.
LORD SANDFORD LORD SANDFORD moved Amendment No. 15:
Page 32, line 13, leave out from ("seaman") to end of line 18 and insert ("and he has as soon as practicable reported to the proper officer or to a responsible representative of the employers, he may recover them from the employers unless—

(i) under the terms of his employment they were to be borne by him; or

(ii) he was left behind through, his own wrongful act or neglect.")

The noble Lord said: My Lords, I beg leave to move Amendment No. 15. Incidentally, may I say that I think an error has crept in somewhere, either in my drafting or in the printing. It should read, "Page 32, line 13", and not line 14, as shown. I moved an Amendment on this point at the Committee stage, but withdrew it in the light of Lord Brown's remarks, shown at column 213 of the OFFICIAL REPORT of April 8. I have reconsidered the Amendment in the light of those remarks, and have put forward a slightly re-drafted Amendment. It gives effect to what I want to achieve in the light of the noble Lord's comments, but it incorporates in the terms in which it is drafted some of the assurances given by the noble Lord, Lord Brown, at column 213. At that point he indicated that the provisions here would not operate until the seaman had reported. But

919
I think if that is so it would be better to put it into the Bill.
There was also the question of upon whose shoulders the onus of proof should lie in proving the circumstances in which the seaman got left behind. I believe that the fact resulting in a seaman's being left behind will be largely within the know-ledge of the seaman, and that it is not equitable that the onus of proving such facts should lie exclusively with the employer. My earlier Amendment would have shifted the onus from the employer to the seamen. The present Amendment is silent upon the onus of proof, which would thus be dealt with under the nor-mal rules of evidence. This seems to me to be a fair solution in the circumstances.
The Amendment also provides for the removal of liability for expenses due solely to the seaman's delay in reporting. This was the point to which the noble Lord, Lord Brown, referred at col. 213, and I think it would be rather better if it were incorporated in the Bill. I hope that has made clear the purpose of my Amendment, which is substantially as it was before, but I believe improved. I beg to move.
LORD BROWN: My Lords, to put this matter quite simply, I understand that this Amendment would have the effect that before the seaman's right of recovery could arise he would have had to report to the proper officer or to a responsible representative of his employer. That is the main effect of the Amendment. I think I can reassure the noble Lord to the extent that I hope that he will see fit to withdraw this Amendment. I do not want to get too involved because this matter becomes complicated if one goes into detail; but the point is that the Board of Trade are empowered under Clause 62 to make regulations.
I wonder whether I may deal with this matter shortly by saying that after discussions with officials at the Board of Trade I can positively assure the noble Lord that the substance of the Amendment he is proposing will be taken fully into account by the Board of Trade in considering the regulations they will have to make under Clause 62(1). This is a reasonable Amendment, but it raises a matter that is better dealt with by regulation because it will then be the
920
subject of consultation with all the parties concerned, and this is one of the matters upon which we wish to have consultations. There may be complexities in this matter, and on the question of one or other party not necessarily agreeing, the Board of Trade are, as I say, empowered to make regulations, but before doing so they want to listen to the parties. In the circumstances, I hope that the noble Lord will see fit to withdraw his Amendment.
LORD SANDFORD: My Lords, I think that that assurance goes a long way to meet my point in this Amendment. But I wonder whether the House will agree to allow the noble Lord, Lord Brown, to speak a second time, in order that he may give us a slightly more precise assurance that, in consulting with a view to drawing up these regulations, he will make it quite firm that the obligations arising out of Clause 64 will not operate unless and until the seaman, or whoever is concerned (perhaps a member of the crew), can show convincingly that he has taken all practicable steps to report as soon as possible to the proper officer or, failing the existence of such a person, to the responsible representative of the employers. If that is not done, I think it conceivable that, months after this event has occurred, the man in question may be taking legal advice and may be asked, "Did you report to the proper officer?" He may say, "No, I did not do that", and he may be told, "Well, go and do it now". Unless we have that point covered by the regulations there is here an enormous loop-hole.
LORD BROWN: My Lords, if I may with the permission of the House speak again, I must say that I cannot give the assurance asked for. I think that the noble Lord has not quite understood what he is asking for. I am sure that he is as keen as I am on proper consultations— indeed, at his instigation I shall later be moving an Amendment to ensure that consultations take place. But, of course, if before you come to consultations you find that people do certain things, this vitiates the consultations. I have no doubt that the Board of Trade will make regulations insisting that men do report, but one must leave the matter there. Sup-posing the employers, the trade unions and others concerned want something different, is the noble Lord really going to

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bind them during consultations to accept something else because he insists upon it? We are not the only repositories of wisdom. I think the noble Lord will have to accept my assurance that the Board of Trade believe that a provision of this sort will be necessary, but that they must have the right to leave the matter open in case they are convinced during consultations that it is not reasonably necessary that something else should be put in. I think the noble Lord is asking too much to expect me to vitiate consultations in advance in this way, and I beg him to accept the assurances that I have given.
LORD SANDFORD: My Lords, if I may, with the leave of the House, speak a second time, I should like to say that perhaps I am being unreasonable. However, this is a most important point, and there is such an enormous loophole at present, I think, that I may feel on Third Reading that it ought to be closed by an Amendment to the Bill itself, but certainly I will not take up the time of the House now. I beg leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
Clause 85 [Amendment of Merchant Shipping (Safety Convention) Act 1949]:
6.36 p.m.
LORD BROWN LORD BROWN moved Amendment No. 16:
Page 41, line 11, at end insert—
(" () Before making rules under any of those sections the Board of Trade shall consult with organisations in the United Kingdom appearing to them representative of persons who will be affected by the rules.")
The noble Lord said: My Lords, this is a simple point. When Clause 85 of the Bill was considered in Committee in your Lordships' House I undertook to look: further into the question of whether there should be provision in the Bill requiring consultation by the Board with the industry before the making of rules under the powers given by Clause 99. The rules will deal with the provision in ships of radio equipment, direction-finders and radio navigational aids. I am now convinced that there should be a statutory
922
requirement for consultation before the rules are made with organisations in the United Kingdom representing persons affected by the rules. This Amendment so provides. I beg to move.
LORD SANDFORD: My Lords, I am sure that the House will be grateful to the noble Lord for having in this respect met the point which we raised on the Committee stage. In view of what he has said, I believe that it will not be necessary for me to move Amendment No. 19, because the purpose of that Amendment is to deal with a matter which could be easily and perhaps more conveniently dealt with in the course of these consultations. Perhaps the noble Lord would like to indicate in a moment whether he agrees that this matter can be so dealt with, in which case I can assure him now that I shall not move Amendment No. 19. At the same time, to encourage him, we are quite willing for him, if he so desires, to move the remaining Amendments, Nos. 17 to 22, which axe in his name, en bloc.
LORD BROWN: My Lords, yes, certainly. Amendment No. 16, which I am moving now will enable consultations to take place about the duties of radio officers. There will be discussions about this matter. I am glad to know that the noble Lord feels that it will be un-necessary for him to move his Amendment No. 19.
On Question, Amendment agreed to.
Clause 95 [Fishing vessels]:
LORD BROWN: My Lords, I beg to move Amendment No. 17.
THE LORD CHANCELLOR (LORD GARDINER): My Lords, if no noble Lord objects, I will put with Amendment No. 17 the following Amendment, Amendment No. 18.
Amendments moved—
Page 45, line 1, leave out from beginning to ("not") and insert ("Section 15 of this Act does ").
Clause 96, page 45, line 30, leave out ("and 90") and insert ("88, 90 and 91 ").—(Lord Brown.)
On Question, Amendments agreed to.
Schedule 1 [Sections substituted for sections 3 and 6 of Merchant Shipping (Safety Convention) Act 1949]:
THE LORD CHANCELLOR: If no noble Lord objects, I will put Amendments Nos. 20, 21 and 22 together.
LORD BROWN: My Lords, I beg to move Amendments Nos. 20 to 22.
Amendments moved—
Page 48, leave out lines 38 to 42.
Schedule 2, page 51, leave out lines 4 to 8 and insert—
("7. Except as provided by or under this Act or any other enactment, the wages due to a seaman under a crew agreement relating to a fishing vessel shall be paid to him in full.")
Schedule 3, page 52, line 36, leave out paragraph 10 and insert—
(" 10. For subsection (2) of section 10 of the Merchant Shipping Act 1964 there shall be substituted the following sub-section—
"(2) Subsection (6) of section 3 of the Act of 1949 (detention of ships not conforming with radio rules) shall apply in relation to the portable radio apparatus so required to be carried by the boats or life rafts on any ship as it applies in relation to the radio equipment of the ship." ").—(Lord Brown.)
On Question, Amendments agreed to.

FILMS BILL
6.40 p.m.
BARONESS PHILLIPS: My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read 3a.—(Baroness Phillips.)
On Question, Bill read 3a, with the Amendments.
BARONESS PHILLIPS: My Lords, in moving that this Bill do now pass, I should like to express my appreciation to those noble Lords who have provided such useful information to us during the various debates that we have had. I should like also to thank the noble Lord, Lord Strabolgi, for enabling us to facilitate the passing of this Bill through this House. I beg to move that this Bill do now pass.
Moved, That the Bill do now pass. —(Baroness Phillips.)
On Question, Bill passed, and returned to the Commons.

EXPLOSIVES (AGE OF PURCHASE) BILL [H.L.]
6.41 p.m.
LORD BESWICK: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Beswick.)
On Question, Motion agreed to.
House in Committee accordingly.
[The BARONESS WOOTTON OF ABINGER in the Chair.]
Clause 1 [Age of purchase of fireworks, etc.]
LORD DERWENT LORD DERWENT moved Amendment No. 1:
Page 1, line 6, leave out ("young").
The noble Lord said: May I say that this Committee stage of this Bill is not my fault. I think I explained the point of this Amendment on Second Reading. The Explosives Act 1875 did not refer to "young children"; it referred to children under a certain age. This clause refers to "young children", though the mini-mum age has been raised to 16. I think that any boy of 15, and particularly any girl of 15, would be rather annoyed at being called a "young child"; and it is not a true description of them. I beg to move.
LORD BESWICK: I seem to make a habit these days of accepting Amendments from the noble Lord, Lord Derwent. I am happy to accept this one.
On Question, Amendment agreed to.
Clause 1, as amended, agreed to.
Remaining clause agreed to.
House resumed: Bill reported, with the Amendment.

AUSTRALIA AND NEW ZEALAND BANKING GROUP BILL
Returned from the Commons, with the Amendments agreed to.