HL Deb 04 March 1971 vol 315 cc1488-507

3.28 p.m.

LORD DRUMALBYN

My Lords, I beg to move that this Bill be now read a second time. This is quite a short Bill, but none the less important for that. It introduces no new principles that do not already apply in the coal industry or elsewhere. It has two main purposes: the first is to provide for continued support for the National Coal Board in dealing with the problem of the reduction of manpower in the industry. The second is to provide for an appraisal of the Board's non-colliery activities—as is quite appropriate a quarter of a century after the Coal Industry Nationalisation Act—and for any action that may be thought proper in consequence of the appraisal. The opportunity is also being taken to raise the limit on the National Coal Board's accumulated deficit and to empower them to borrow in foreign currency and provide technical services overseas.

While coal has no longer such a vital place in our households, in our industry, in our transport system and in our exports, it still accounts for roughly half of our total energy consumption and provides nearly three-quarters of our fuel for the generation of electricity. In the past ten years coal production has fallen by nearly a quarter, and the numbers employed have dropped by more than half—by four-sevenths, in fact. Yet the industry is still our largest employer in the industrial sector. In the past two years or so the importance of coal and our dependence on it have been underlined by the way in which a surplus of supply has changed to a coal shortage.

During the next three years, with which the Bill is especially concerned, it is not expected that manpower in the industry will continue to decline at the high rate it was falling in 1968 and 1969. Nevertheless, we must expect some further reduction as the long-term process of contraction and concentration continues. To help to deal with the human problems of contraction of employment, a continuance of Government support is needed. This Bill is designed to meet that need, along lines similar to those in the Act of 1967. We all recognise the immense difficulties that the contraction of the industry involves for those affected by it. The fact that these problems have resulted in so little friction reflects great credit both on the management and on the mineworkers themselves. In this connection, I would like to pay a tribute to the retiring chairman of the National Coal Board the noble Lord, Lord Robens of Woldingham, whose foresight, tact and energy we have all so much admired. It is wonderful what a warm heart, coupled with ability and single-mindedness, can achieve. The industry's loss will, I hope, be our gain in this House.

The first two clauses of the Bill provide for further Government support for alleviating the social problems which arise from the industry's concentration and reduction of manpower. In the later 1960s the rate of pit closures and of decline in manpower was rapid; in 1968 some 70 pits were closed, and manpower fell by 58,000. Recently, the demand for coal in the United Kingdom has outstripped production. In 1970 only 10 pits were closed. Even so, earlier in the winter our coal supplies caused anxiety. However, we have so far had a mild winter and so we have not been as badly off as we might have feared. The outlook for next winter remains somewhat precarious. But the decision to relax restrictions on coal imports last December, coupled with the expectation of more coal from opencast sites, and the grant of applications to convert more power stations improved the prospect. Even in this period when we need coal, and when the Board have been trying to get recruits, there has been redeployment and outflow of manpower. This is likely to continue, with its attendant social problems, during the three years, though at a slower rate than in the later 'sixties.

Clause 1 will extend for a further three years, to the end of March, 1971, the power to contribute towards expenditure incurred by the National Coal Board as a result of the closure of uneconomic or worked-out pits and the re-deployment of manpower. This expenditure includes payments on account of redundancy, loss of prospects and premature retirements, and of removal and resettlement expenses. The Government contributions will be on a tapering basis, reflecting the Government's view that, by the end of the period the rate of reduction in manpower should be lower and the industry should be in a positron to carry its own costs. The provisions are almost exactly the same as those proposed in the previous Government's Coal Industry BII introduced in another place last spring. The only substantial change is that the overall limit on expenditure has been raised by £2 million to take account of increased costs.

Clause 2 will extend the power to make schemes for payments to mineworkers who become redundant during the three years to the end of March, 1974. For an initial period—up to March next year—the existing scheme as it stands will be extended by means of a Statutory Order which will not require further authority from Parliament. During the period of this extension a review is to be made of the scheme in the light of many factors—manpower prospects, regional developments and consultation with both the board and the unions, and so on. The result of this review will be incorporated in a revised scheme, which will be submitted for the approval of each House of Parliament in time to come into force not later than the end of March next year. These proposals do not differ in substance from those contained in the Bill introduced by the previous Administration last year. I should add that the Coal Industry Act 1967 provided for reimbursement of the extra costs incurred by the Board in contributions to the industry's pension schemes where mineworkers receive superannuation benefit on retiring before pensionable age. Those provisions will continue to apply under Section 4 of the 1967 Act and do not need to be extended in this Bill.

While we are renewing two of the support measures proposed by the previous Government, we consider that two others are not needed now. With demand for coal exceeding production there is no need to provide powers for the Government to pay for coal to be used at power stations and gas works where it would not otherwise have been used—what is called "extra coal-burn"; though, should coal again move into surplus, the Government will consider reintroducing this power. There is even less justification for compensating the Board for deferring pit closures. With the present supply and demand positions, mines are likely to be closed only when they are worked out or quite uneconomic.

Clause 3 will raise the limit on the Board's accumulated deficit from £50 million to £75 million, and enable the Secretary of State to reduce the limit by Order or to increase it within a ceiling of £100 million. The Board's deficit has accumulated sharply in recent years. At the end of March, 1969, it was £8 million, but a year ago it was £34.5 million—due to a combination of higher costs (including wages and materials), slower rise in productvity and the unofficial strike of October, 1969. This financial year, too, there was a strike, and a further deficit is inevitable. We hope for better results next year. When stability is restored, the limit will be reviewed and, if appropriate, reduced. To avoid any misunderstanding, I would repeat the assurance given in another place that the increase in the limit is in no way in preparation for hiving-off profitable activities. It is simply to enable the Board to keep within the law.

The next two clauses closely resemble provisions in the previous Government's Bill. Clause 4 will enable the Board to borrow at medium and long term in foreign currency. This will incidentally enable them to take advantage of the loan facilities offered by the European Coal and Steel Community, should the negotiations to enter Europe be successful. Foreign currency borrowing by such bodies as local authorities and nationalised industries can also improve the structure of the nation's overseas debt, by the replacement of short-term with longer-term debts. Clause 5 empowers the Board, subject to the approval of the Secretary of State, to provide technical assistance overseas; many developing countries have established or potential coal industries which would benefit from the Board's expertise. The Government will, however, have to take account of any other United Kingdom sources which may be able to provide the technical assistance in question.

My Lords, I turn now to Clauses 6 and 7, which relate to the Board's non-colliery activities. At the time of nationalisation a number of non-colliery activities—such as brickworks, coke ovens, and housing—were transferred to the National Coal Board, but these were of relatively little consequence in comparison with the Board's main activity, the getting of coal. As demand for coal declined, these diversified activities have widened and expanded. They now extend to builders' merchants, district heating, retail coal distribution, chemicals. North Sea gas, and hotel reservations. They are carried out in various ways—through Divisions of the Board, wholly or partly owned subsidiaries, partnerships and equity interests in private companies.

Now—a quarter of a century after nationalisation—the time has surely come to assess and appraise these developments coolly and calmly. After all, the Government have a legitimate interest in them, both as trustees of the shareholders and, on occasion, as bankers. Clause 6 will enable the Secretary of State to direct the Board to review and report to him on their non-colliery activities, or any of them, which cover assets the book value of which totals about £137 million.

The review will be carried out by the Board, and will enable first the Board themselves and then the Government to appraise the value of these activities both to the Board and to the taxpayer, and to map out the best course for the future.

What should be the scope of the review? Is it possible to draw a precise line between the getting of coal, which is the primary duty of the Board, and other activities? "Colliery activities" are defined in the 1946 Act fairly narrowly as: searching or boring for, winning, working or getting, coal, bringing it to the surface, treating it and rendering it saleable, and includes depositing spoil arising from working coal or from any other of the activities mentioned in this definition". That is a fairly narrow definition. Obviously activities which are as closely bound up with collieries and coal mining communities as pithead baths, colliery canteens and colliery electricity generating plants would not be included in the review. As for the rest, it can certainly do no harm, and should do good, for them to be reviewed, so long as there is no disclosure of information that might be prejudicial to the commercial interests of the Board or any of their business associates. An assurance has already been given in another place that such confidential information will not be made public.

A review under Clause 6 may indicate that it would be undesirable for the Board or their subsidiaries to continue to carry on a particular non-colliery activity, or that they should organise such activities in a different way. Clause 7 will enable the Secretary of State, if he is satisfied that a direction would not prejudice the effective discharge of the Board's duties, to give the Board directions to do what is necessary to achieve the most desirable course of future development. It may well be that he will not have to give such directions, because the desirable course will be apparent to both Board and Minister. Before giving any direction, the Secretary of State will have to consult the Board. And any direction, under subsections (1) or (2), such as discontinuance or restriction of any of the Board's non-colliery activities or the disposing of any part of their undertaking or of any of their assets, will be subject to Parliamentary examination. There is nothing new about these provisions in nationalised industry legislation—

LORD DIAMOND

My Lords, the noble Lord has just said that these proposals will be subject to Parliamentary examination. He said a moment ago that he was confirming the undertaking that had been given with regard to confidentiality. Is he saying that the proposals which he will be putting to both Houses of Parliament will be on the basis of information which he undertakes not to disclose to either House of Parliament?

LORD DRUMALBYN

No, my Lords. What I was saying in regard to confidentiality was obviously related to Clause 6 and the review. Plainly, all we are doing here is to say that Parliament has a right to know when the time comes to disclose.

LORD DIAMOND

My Lords, I am deeply sorry to interrupt the noble Lord again, but he said that Parliament has a right to know. Will he therefore say what weight is to be attached to the undertaking, when the information could well be treated with full confidentiality and would not be disclosed?

LORD DRUMALBYN

My Lords, this seems to me to be rather a dialectical point. Quite clearly, the purpose of the review is to enable an appraisal and subsequent action to be taken if necessary. So far as the appraisal is concerned, there will be no disclosure of information. When it comes to taking action, then of course matters will become public. That is bound to be so. May I put it this way? It was in response to pressure from the other side in another place that the assurance in regard to confidentiality was given. It was also in response to pressure from the other side in another place that the undertaking was given that Parliament would have the opportunity to examine any proposals under Clause 7. I see nothing but, at best, a dialectical disparity in this matter. However, I think the noble Lord will agree that this is perhaps a matter which should be further explored in Committee. It is rather a Committee point.

As I was saying, there is nothing new about these provisions in nationalised industry legislation. Labour Governments have introduced similar powers when nationalising other industries, although your Lordships may be surprised to find that there are no such provisions in the Coal Industry Nationalisation Act 1946. Such powers, for example, as those to require reviews and reports on the organisation of activities were included in the Iron and Steel Act 1967, and the Transport Act 1968. Comparable powers to give directions to discontinue or restrict activities were included in the iron and Steel Act 1967, and the Post Office Act 1969, and were first introduced by the earlier Labour Government in the Transport Act 1947, only one year after the Coal Industry Nationalisation Act.

I conclude my remarks on this clause by stressing yet again that the Government have no preconceived ideas about the future of any of the activities that might be the subject of a direction under Clause 7. Certainly it is not their intention to require assets to be disposed of for purely doctrinal reasons, but only where it is judged to be in the best interests of the Board and of the nation. Clause 8 will provide for improvements in the form of the Board's accounts. The Board already provide more information than most companies and corporations about their activities, but it is still true that some recasting of their accounts will afford a greater degree of public accountability.

To sum up, my Lords, the Government believe that all the provisions in this Bill are sensible. Most of the early clauses are in keeping with the Bill introduced by the previous Government. And part of it is concerned with better accountability for the public money invested in the industry, and the need to have a clear understanding of the direction it is to take in the future. I hope that as a result of discussing both parts we shall be able to reach broad agreement about them. I hope, too, that your Lordships will be willing to deal with the Bill with due dispatch, for it is desirable that it should be enacted and an Order made under Clause 2 as soon as possible, so as to avoid any difficulties over the payments to mineworkers who become redundant from now on. My Lords, I beg to move.

Moved, That the Bill be now read 2a.—(Lord Drumalbyn.)

3.47 p.m.

LORD DIAMOND

My Lords, my first pleasurable duty is to thank the noble Lord for having explained so clearly and shortly the main purposes of this Bill. I want to thank him also—and to join with him in it—for the tribute which he paid to my noble friend Lord Robens of Woldingham and to all those connected with the industry, from top to bottom, who jointly have achieved what is a near miracle in industrial relations in the way they have behaved in the face of a steady running down of their industry and a falling away of their possibility of making a living and of using the skills which they learned in their childhood. It is a tremendous achievement and compares starkly with the situation which we see generally around us in other areas. The noble Lord's tribute therefore was indeed well earned. A little later I shall ask the noble Lord whether he can give us any enlightenment on why, in these circumstances, the noble Lord, Lord Robens, did not feel able to continue with his important and valuable work as Chairman of the Board.

I wish to shorten my speech as far as possible, because the noble Lord has made it clear that some of the clauses—in effect, seven out of the ten—were either in the earlier Labour Government's Bill, which did not find time to pass, or are consequential. Therefore, as those clauses have been previously discussed and the noble Lord has put the position perfectly fairly with regard to them, I do not think it would be proper for me to delay your Lordships on any one of them, although when the Bill comes to the Committee stage we shall naturally wish to examine them, as is our responsibility, and perhaps to suggest one or two improvements.

I appreciate what the noble Lord said about the desirability of passing this Bill with due despatch, but the trouble is that there is not one Bill in front of your Lordships: there are two Bills. There is the Bill which is broadly the Labour Government's Bill and which was essentially to enable the kind of industrial situation which I have described to continue. That was agreed on all sides and, but for the happening—I almost said, in my case, the mishap—of the last General Election, it would have been passed into law. It is essential, as I well understand, that that part should pass quickly; indeed, I believe that the present powers finish at the end of March.

But we find before us a Bill somewhat delayed in its introduction and considerably delayed in its passage through another place because to those original seven clauses there have been added three-other clauses which no Government could in any circumstances regard as other than highly controversial and which we regard as damaging to an unlimited degree. When the noble Lord said, in the second sentence of his speech, that no new principles had been introduced into the Bill, I thought he was really putting it in a way that, had it not been only the second sentence, I would have been bound to interrupt him. I hope to satisfy your Lordships that the noble Lord was using words in a meaningless way when he allowed those words to escape the barrier of his teeth, if it is permitted to be Homeric in your Lordships' House.

My complaint against the Bill, therefore, and our complaint, relates partly to the sins of omission; that is to say, clauses of the previous Bill which have been left out, and partly to the sins of commission; that is to say, the offensive clauses to which I have referred. And if I have not made it clear to your Lordships what my position is with regard to sin, I am on the whole against it. The sins of omission are two in number, but I will deal only with the major one at the moment. It is the lack of wisdom, if I may so describe it, in not continuing the power to compensate Electricity Generating Boards for burning coal, when it is more expensive to do that than make use of other fuels, in order to enable more coal to be used and in order to enable miners to know that when they are working harder and more efficiently they are not working themselves out of a job.

This power was essential and was used, and was one which it was thought necessary to continue. But, of course, because it is not within the capacity of man to forecast the future with accuracy, within a short period of years the position had completely turned round, as the noble Lord explained, and what was a surplus has become a marked deficiency—and not only in this country. For the moment, therefore, that power need not be exercised. But by the same token—that is to say, that we could not three years ago know what the position would be to-day; in fact, far more recently well-informed Ministerial statements on both sides were pointing to a totally different situation from that which exists to-day—it is surely right for me to suggest that it is beyond the capacity of even the noble Lord to say for certain that over the next reasonably short period of years he will not wish to use these same powers.

I cannot see, therefore, why, when his view, when the Minister's view, the view of the Minister for Industry, and when the view of my right honourable friend in another place are all the same—namely, that we should maintain complete flexibility in our approach to the use of alternative fuels—he does not arm himself with the powers, That is all I am asking, that the powers should be continued. I have had the privilege of being in Government, but I have never had the unusual circumstance of the other side inviting me to take on powers, and refusing to take them on. It is a most unusual situation. So I hope that the Government will have second thoughts about that.

I now quickly turn to the offending clauses, Clauses 6, 7 and 8. Clause 8 is consequential, so it is really Clauses 6 and 7 which introduce totally new principles, as I shill explain to your Lordships, and which we shall seek to oppose by every means within our legitimate and constitutional power. I of course know that your Lordships will have read the Bill from cover to cover with great care, but may I nevertheless read to your Lordships what is said about Clause 7 in the descriptive part of the Bill, the Memorandum? It says: Clause 7 empowers the Secretary of State to direct the Board to discontinue or restrict any non-colliery activities, dispose of any part of such undertaking and any assets held by them, call in any loan made by them, or exercise any power they may possess to revoke any guarantees given by them, provided he"— that is, the Minister— is satisfied that any of these matters are unnecessary for the proper discharge of the Board's statutory duties. These are very fundamental, far-reaching powers of interference in management of a most profound kind.

Not satisfied with that, the Memorandum goes on: The Secretary of State will also be able to direct the Board to exercise similar powers over their subsidiaries. Now your Lordships know that subsidiary companies are companies in which the Coal Board hold, for example, 51 per cent. of the shares, the other 49 per cent. being held by ordinary shareholding individuals. All these powers are to be exercised irrespective of the interests of the other 49 per cent.—a totally new concept of law so far as I have always understood it; certainly a new concept of business morality. Their interests are to be totally overridden and unconsidered because the Secretary of State will be taking powers similar to those I have read out over their subsidiaries, and, as the Minister so rightly said, that is so whether they are wholly-owned or partly-owned subsidiaries. It goes on: The Secretary of State is empowered to direct the Board to alter the way in which any non-colliery activities of the Board of their subsidiaries are organised. That means, my Lords, that here, for the first time, we see the State taking power through Ministers who are no doubt very able people, who may have spent a lifetime in politics, in journalism, at the Bar or at anything totally disconnected with running a business, aided by the most expert advice coming from civil servants. Most of them will have got a Double First before they come into the Minister's room; they may be experienced in all fields of Government and before they went into the Government service, they may have been experienced at the Bar, but they will be almost all wholly lacking in experience at running a business. Here we see a Government taking power through these twin agencies, the Minister being advised by his civil servants, to direct the Board to alter the way in which any non-colliery activities of the Board or their subsidiaries are organised. My Lords, I am not overstating it; I am understating it, because, of course, a subsidiary could be a company in which 99 per cent. of the shareholding is owned by the outside world of individual shareholders and in which the Board merely has the right to appoint and remove more than 50 per cent. of the Board. So there could be 1 per cent. of the nation's money and 99 per cent. of private individuals' money involved.

It is wrong, with respect, for the noble Lord to shake his head unless he were meaning, "What a terrible state of affairs we find ourselves in!". In that case I agree with him. But, with respect, if he is disagreeing with what I have said, he will at some appropriate time direct my attention to that part of the relevant section of the Companies Act which is used as the definition and incorporated in the Bill now before us and which differs from the words I have used. I notice that the Minister is not disputing what I am saying. So, my Lords, I repeat: I am understating it in making it clear that a subsidiary company is one in which either the Board has more than 50 per cent. of the shares or it has power to appoint the majority of the Board. So that situation is going to apply, and there will be much more than interference: there is going to be instruction as to the way in which the business is run.

The noble Lord said that this does not represent a new principle. I find it difficult in your Lordships' House to use words which are both appropriate to your Lordships' traditions and also necessary for the occasion—because, of course, nothing could be further from the situation which the noble Lord has described than the position under this Bill. The whole of the nationalising Acts, the whole of the nationalising procedure, has been on the basis that it is right to acquire assets and companies for the nation. It is right that the nation, which is paying the whole of the money should be entitled to lay down the broad principles of the way in which these nationalised industries should be run. But it is essential, in order to obtain good and effective management, that those who are running the industries should have freedom to carry out their day-to-day affairs. This has been the principle enshrined in every single Bill. Now, under this Bill, and for the first time, a totally new situation is proposed.

Under the Bill, the Minister, aided in the manner I have described, will be able to direct the way in which either the Board or a subsidiary company—being wholly owned, or partly owned, or a company in which 99 per cent. of the shares belong to outside individuals—is to be run. I am seeking to make clear why I think that this is a totally unwise way to proceed; and I find it difficult to see what has given rise to it, unless I look (I am loath to do so, but I have to look for a reason) at the Manifesto of the Conservative Party at the last General Election. There I find the sentence: We will progressively reduce the involvement of the State in the nationalised industries. My Lords, it is perfectly clear from that statement that what the Government have in mind is to give effect to a piece of outworn philosophy which was no doubt of benefit in winning elections but which I should have thought by now, faced with the realities of the situation, they would be the last to wish to continue. I should have thought that, having achieved in less than twelve months a situation in which we have the highest unemployment for years, the worst industrial relations for years, the lowest prices on the Stock Exchange for years, the biggest bankruptcies for years—indeed, for ever, I imagine: having achieved all that within a short period of less than a year by their economic policies, they would have cause to think again.

My appeal is based purely on this. For heaven's sake! do not let us be driven into making more and more mistakes because we have in the past had to accept certain dogmatic approaches in order to satisfy those who were unaware of the problems that arise when you are faced with the day-to-day events in Government. I have, of course, the responsibility of demonstrating to your Lordships that this would be a mistaken approach. Well, my Lords, is it in the interests of the Coal Board, and do the Government think it is in the interests of the Board, that these activities should be hived off, or that they should not be hived off? We have only to look as far as the Minister's own words—and now I should like to quote the Minister for Industry who was speaking in the other place, in Standing Committee "B" on February 2, as reported in the OFFICIAL REPORT, at col. 408. He said: Honourable Members recognise the National Coal Board has extended its activities into fields that were never contemplated when the 1946 Act was passed. I do not criticise the Board for doing that. It is not for me to comment at this stage on the direction which it has chosen to follow. I do not blame it for taking full advantage of whatever opportunities came its way. That is what one would have expected of good management. The noble Lord, Lord Drumalbyn, said something very similar, and relating to that, when he made his opening speech. He paid tribute to my noble friend Lord Robens of Woldingham for the way in which he carried out the affairs of this organisatiaon, this huge nationalised company, which has had to face—and which knew from the very beginning that it would have to face—a falling away in its normal central activities. The Board knew that from the word "go". Therefore they had to deal with the human problem of the miners whom they would not be able to continue to employ. The Board had to deal with the problem of using their assets and skills, the skills of their men, the skills of their high-fliers, in the way in which every management, without exception, seeks to do; namely, by extending into fields related to—but not identical with—the central core of its activities.

My Lords, every management seeks to do that very thing. This management has done it in a way which has satisfied the Government, because the Government have said that this is what one would have expected of good management. And when, as Hansard records, honourable Members said, "Oh!", the Minister said, "That is right", I wish I had been there to hear what, "Oh!" really was, but I did not have that pleasure. The Minister was confirming what he had previously said: that this is what one would have expected of good management. So my Lords, there is no objection to the peripheral activities of the Coal Board on the ground that they are badly managed.

Is the objection that these activities are unprofitable? Let me deal with that. Let me remind your Lordships of what the Economist said on November 28 last year: It was made clear this week that, when the Bill"— that was a reference to this Bill— gets through Parliament Lord Robens will be directed to list all the non-mining activities which the Government would like to put on the market. As chance would have it"— a most entertaining phrase— these non-mining activities which account for £131 million of the National Coal Board's £840 million turnover are profitable. Well, my Lords, that is a very fortunate chance. Then the Economist goes on to say: There are some attractive titbits"— I hope that "titbits" is a proper word to use in your Lordships' House— in the National Coal Board's non-colliery cupboard. With a total capital of £122 million the non-coal activities"— those of which the Minister is here seeking power to order the Board or their subsidiaries to divest themselves— show an average return on capital of 33 per cent. for the coke ovens, 10.3 per cent. on processed fuel plants, 2.7 per cent. on housing and 13.2 per cent. on 'other activities'. The Government would be wrong to compel a forced sale of any of these. As noble Lords who are interested in this matter will know, those percentages are, on average, somewhat higher than the average return on all capital employed by the private sector over the last six years. So the Coal Board's return on capital is better than average. The activities are well managed; they are profitable. The Minister himself has said that they are profitable—I have the reference somewhere, but I am sure that the fact is not disputed. I think he said that they accounted for something like £13 million; and the interesting point is that this £13 million of profit was the figure which made the whole of the Coal Board profitable. Without that £13 million there would have been a loss on the other central activities.

We are getting to a situation where your Lordships are being invited, on behalf of the nation (the noble Lord did not make it absolutely clear, when he talked about mapping out the best course for the future, whose interests he had in mind, but I take it that he will not mind my saying that he must have had in mind the national interest), to agree procedures and powers which, if the Government have their way and continue on their dogmatic, outmoded approach, will result in their being enabled to sell off, at either convenient or inconvenient moments, property which belongs wholly, partly or only to a very small extent to them, and to interfere in the running of the business, merely, as I say, so that statements made in the heady atmosphere of Party Conference might abide. I do not think that that is sufficient reason in our present difficult times—industrially very difficult, economically extremely difficult—to try these pointless experiments, so far as the National Coal Board are concerned.

I invite your Lordships and everyone who has responsibility of a similar kind—and I know that there must be many—to consider how, against that kind of background a Board of able commercial men are going to be willing, or able, to continue their activities with energy and devotion if they have a Minister and the whole of his Department breathing down their necks, ready at any time to tell them that the agreements they have entered into in good faith with partners all over the world, in order to achieve a profit and to carry out useful activities in the national interest in accordance with their own statutory duties must be broken. It will be a sheer impossibility. There is not one noble Lord in this House experienced in management who would put that forward as a method of improving the organisation of his business.

One must work on the basis of appointing the right man, and giving him a reasonable opportunity to show that he can do his job and do it well. And there is no dispute that in the case of the Coal Board it has been done well. The noble Lord congratulated the Board; the Minister congratulated the Board: the profits are there. I do not know what has bitten the Government that they should wish to upset the miners, to add a further irritant to our already very irritated industrial relationships in order to put these powers on the Statute Book. After all, if the noble Lord is right in his estimate, these powers may hardly come to be used; and if they are to be used, they will be used to the disadvantage of the nation and will the whole time be a sort of Sword of Damocles hanging over the head of every individual within the Coal Board who would wish to do a good job in the interests of the nation.

My Lords, I have not made the speech I had intended to make, but that is often my lot. I have said what is in my heart, and I hope that I have made some appeal. I have been as accurate as I could be about the facts of the situation. I find it quite impossible to understand why the Government should wish to proceed with those particular clauses of the Bill. Therefore I must make it clear that we on this side of the House are going to do everything we can to eliminate those clauses, to help the Government to come to their senses on this matter. If we fail in our endeavours, we shall seek to amend the clauses in the best way we can. We are a minority, a democratic minority. All of us on this side of the House recognise that the Bill has had a Second Reading in another place on the basis of a majority recently elected in a democratic way. In those circumstances it would be wholly wrong—and I understand that this is normal practice and the accepted constitutional position here—to vote against the Second Reading of this Bill. Indeed, if I may say so, this is one of the most delightful practices that I have found; because all of us on this side happen to be members of a Party which is in a small minority here but which will shortly be in a large majority in another place. Therefore the last thing we should want is that any other constitutional practice should prevail.

LORD SHINWELL

My Lords, I am sorry to interrupt my noble friend, but I should hardly have thought that this constitutional issue was a matter closely relevant to the Bill before the Home. It seems to me to be a separate item upon which it might be inadvisable to "jump the gun".

LORD DIAMOND

My Lords, I never seek to "jump any guns". I am much too ancient; I have lost such agility as I once had to enable me to do such a thing with any success. I was only seeking to explain, and I do not entirely understand what my noble friend—

LORD SHINWELL

My Lords, is not my noble friend referring to the possibility of declining to vote against the Second Reading of a Bill which may come before this House in the future? Is it altogether wise or proper to state what may be regarded as a precedent acceptable to everybody on this side of the House?

LORD DIAMOND

My Lords, I would never claim to make a precedent. If I did, nobody would pay the slightest attention to it. I have only cited what I understood to be the practice in your Lordships' House, a practice which I am compelled to make clear, for otherwise it would not be understood why I am now going to invite all my noble friends to agree to the Second Reading of this Bill. Having explained how totally opposed I am to certain of its clauses and how sure I am that everyone on this side of the House (and I hope on many sides of the House) is opposed to these clauses, I must explain why it is my responsibility to say to the Government that, nevertheless, for the reasons that I have given we do not propose to seek to divide the House on the Second Reading of this Bill although as I have also made clear we shall do what we can to improve the situation when it comes to the Committee stage.

VISCOUNT ST. DAVIDS

My Lords, before my noble friend sits down, can he confirm what seems to be my impression: that when the Minister has the extraordinarily detailed powers that he is taking under this Bill, he will then have to answer questions in the House on every single detail about any business in which the Coal Board has control?

LORD DIAMOND

My Lords, following the reminder of my noble friend Lord Shinwell, I must be very careful in what knowledge I claim to have of the procedure of your Lordships' House, but I can certainly say what I understand to be (and I can speak with some little authority) the situation elsewhere. Certainly the answer to my noble friend is that in the House of Commons every Minister must answer for all those matters for which he has any responsibility; and that the only way he can escape from answering a question once it has been accepted by the Chair and put on the Order Paper is to claim that it is a matter, like defence, which has to be kept secret in the interests of the Crown or something of that kind. So once a Minister is aware of what is going on, he will be compelled to give information to the House.

I am grateful to my noble friend for reminding me of the exchange which took place a little earlier on. The noble Lord will have to look most carefully at the Hansard record of that exchange, because we are in a situation which is of fundamental importance not only to the Coal Board but to all the subsidiaries, and to everyone who would want to do business with the Coal Board in future, but who would say: "We cannot do business with you any more, because whatever agreement we enter into for exchanging know-how, secret processes or anything of that kind will have to be disclosed. If we enter into this arrangement with you, the Minster will have to be told by you what these details are and then if he seeks to come before the House with an Order subject to the Negative Resolution procedure, the Minster will have to tell the House what these secrets are." Therefore, either the undertaking with regard to confidentiality was worthless, or the other statement was worthless.

Those two undertakings, which the noble Lord said were given under pressure, were totally self-contradictory. I did not think it necessary to refer to them in detail because they seemed so obviously self-contradictory. I am only saying to the noble Lord that he will have to look at these matters most carefully before we come to the next stage of the Bill.