§ 3.36 p.m.
§ EARL FERRERS rose to move, That the Draft Iron Casting Industry (Scientific Research Levy) Order 1971, laid before the House on January 14, be approved. The noble Earl said: My Lords, the main purpose of this Order, which my right honourable friend the Secretary of State for Trade and Industry proposes to make under Section 9 of the Industrial Organisation and Development Act 1947, is to replace the Iron Casting Industry (Scientific Research Levy) Order 1967, so that the income obtained from the Levy may be increased. The Order continues the imposition of the Levy on the iron casting industry to finance scientific research to be carried out within the industry by the British Cast Iron Research Association. The proceeds of the Levy will continue to be collected by the Secretary of State and issued by him to the Research Association.
§ My right honourable friend is satisfied that the Research Association does require an immediate increase in its income if its programme of research is to be carried on at the required level and that the Levy should therefore be increased. The income from the present Levy has been virtually constant, and rising costs have already obliged the 1136 Association to cut back its activities and reduce its staff. My right honourable friend is conscious of the role played by the Association in the iron casting industry, and he is satisfied that the British Cast Iron Research Association should not be allowed to suffer now because of insufficient income. In preparing the draft Order he has consulted and has received support from representatives of the industry and of the foundry workers both to the proposal to increase the yield of the Levy and to the suggested new methods of calculating the charges payable.
§ My Lords, I do not feel this Order is one which is likely to cause controversy, and I therefore thought that it might be to the convenience of your Lordships if I kept my remarks, in moving this Order, as brief as possible; but if there are any points which your Lordships would like to raise I shall be only too pleased to do my best to clarify them. My Lords, I beg to move.
§ Moved, That the Draft Iron Casting Industry (Scientific Research Levy) Order 1971, laid before the House on January 14, be approved.—(Earl Ferrers.)
§ 3.39 p.m.
§ LORD STOW HILL
My Lords, I think the House will be grateful to the noble Earl for explaining so clearly the purpose of this Order. I do not desire to say anything on its merits. My only reason for rising to my feet is that, as the House may be aware, this is one of the Orders considered by the Special Orders Committee of your Lordships' House. That Committee, in reporting upon it, thought it proper to draw attention to one small, technical feature of the Order which your Lordships may wish to consider further.
Your Lordships may desire that I should say just a few words as to the subject-matter of the Report. It relates to Articles 10 and 12. Article 10 provides that the Secretary of State may call upon those concerned to furnish certain returns and other information, and to keep records. Article 12(1) contains a penalty provision and imposes criminal penalties, recoverable by summary procedure, for a failure to furnish that information or make those returns, or keep those records. For the purpose of the matter on which the Special Orders Committee reported the relevant words are 1137 that a person who is said to have failed to comply with the notice shall,unless he proves that he had reasonable excuse for the failure, be liable on summary conviction to a fine not exceeding £5 for every day during which the failure continues.I think I am right in saying that that is a form of penalty which has been not infrequently unfavourably referred to as containing an undesirable feature. The undesirable feature is that the maximum penalty to which the transgressor may be liable under that form of wording varies, or may vary, according to the accident of the time at which the hearing takes place. The normal form of penalty provision, I believe, is that in the event of the continuing failure the fine per day begins as from the date of the conviction; in this case it begins before the date of the conviction. If the case comes on, say, two months after the failure begins, then if the transgressor cannot prove that he had reasonable excuse for failure he may be fined an extra £5 for each of the days in that two months until the case comes on. If it comes on in ten days, there is a maximum of only £5 for each of those ten days. Therefore, the maximum penalty depends on something which may be in the nature of an accident, and the Committee felt that was a very undesirable form of penalty.
I do not know whether the noble Earl would desire to give further consideration to that point, or whether he is able to furnish your Lordships' House with some answer to the Special Orders Committee's point which they overlooked. However, that is the point, and I would ask the noble Earl whether he would make some observation with regard to it.
§ 3.44 p.m.
My Lords, I am grateful to the noble and learned Lord for what he has said. I know that this has been a point which has concerned him. Taken at its face value, it looks as if a person who has not completed his form will be fined £5 for every day upon which that form remains unfilled; but, of course, this is in fact only a maximum penalty and is not a mandatory penalty. The onus is placed upon the person concerned to say to the courts why that form was not filled correctly, or was not returned. It is then up to the courts to decide whether there should be any penalty, or what that penalty should be.
1138 With regard to this specific Order, it is in fact laid down in the Industrial Organisation and Development Act 1947 that this is to be a maximum penalty. Because it is laid down in that Act it appears in the Order. That Act was produced in 1947 under a Labour Government in which the noble Lord, Lord Stow Hill, was Solicitor General, and I assume that it probably had his approval when it was drafted. However, this is the reason why it has appeared in the Order; and in view of the fact that since 1947 up till now, which is a period of some 24 years, the penalty has not been increased, I should not have thought that it was one that would cause very much concern. I think I am right in saying that there have been no occasions on which the penalty has been used.
§ LORD WYNNE-JONES
My Lords, this Order is one which clearly is of considerable importance for the cast iron industry. I think it is most valuable that the income of the Research Association should be increased as a result of the Order. There is, however, one point I should like to ask the noble Earl: will this Levy, when it is paid out to the Cast Iron Research Association, attract the Government grant which is usually given to these research associations?
My Lords, the answer to that question is, Yes, it will attract the Government grant. This grant will, in fact (I hesitate to say it after the last Order), be reduced from 40 per cent. to 35 per cent. Before the noble Lord, Lord Stow Hill, comments upon that, I would merely say that because the amount that is being collected by the Levy will be greater, the actual grant paid will be greater. Therefore the rate of grant, although reduced, will nevertheless result in a greater sum of money being available as grant.
§ LORD WYNNE-JONES
My Lords, is the rate at which the grant is going to be paid now on a diminishing scale? Is it going to decrease each year?
My Lords, it has decreased under the present system; what happens in the future I could not possibly say.
§ LORD STOW HILL
My Lords, if I may have your Lordships' permission to speak again, may I thank the noble Earl 1139 for what he has said and for the full way in which he dealt with the point raised by the Special Orders Committee? The House may remember that I said that it was possible that there were points which had escaped the notice of the Special Orders Committee; obviously that is the case. Those points equally escaped the notice of that member of the Special Orders Committee—namely, myself—who raised the point.
§ On Question, Motion agreed to.