COMPETITION BILL

HL Deb 03 March 1980 vol 406 cc58-129

5.6 p.m.

Report received.

Clause 2 [Anti-competitive practices]:

Lord PONSONBY of SHULBREDE moved Amendment No. 1: Page 2, line 26, at end insert ("or the use of land in the United Kingdom or any part of it for the purposes of carrying on a business.").

The noble Lord said: My Lords, during the Committee stage of the Bill I put down a similar amendment to this one and the noble Lord had some sympathy with it. He told us that this was a matter which was being considered by the Government but that their consideration of it was not yet complete. It was a question of whether business leases should be brought within the ambit of this section. I hope that the noble Lord may have some good news for us. I beg to move.

Lord TREFGARNE

My Lords, I am afraid that I have to disappoint the noble Lord— which is sad, so early in the Report stage of the Bill. Since the point has not been fully understood, perhaps I may say just a few words.

I want to emphasise, first, that the practices which involve restrictions on the use of land are not excluded from the Bill as it stands, provided they meet the various conditions set out in Clause 2(1). The essential condition is that the practice must have some effect on competition in the supply or acquisition of goods or services in the United Kingdom. The restriction on the use of land clearly may have such an effect, and if it does then it can already be investigated.

On the point, however, that the noble Lord specifically raised again on this occasion, the question of conditions of tenure, landlord-tenant relationships and so on is, we believe, best considered in the context of that relevant legislation. I am sorry to say that our considerations on this matter are not yet complete and indeed are unlikely to be so in the near future, but I will ensure that the discussion of these matters which we have had on the various amendments to the Bill are brought to the attention of my relevant right honourable, honourable and noble friends. Your Lordships may perhaps be interested to hear that the Law Commission are preparing a report on certain matters relating to this topic, such as restrictive covenants. I am sorry that I cannot be more forthcoming and helpful to the noble Lord, Lord Ponsonby, but I hope that he will see fit not to press his amendment.

Lord PONSONBY of SHULBREDE:

My Lords, may I thank the noble Lord largely for repeating the remarks which he made during the Committee stage of the Bill. I hope that his examination of ways and means under the Landlord and Tenant Act 1927 to solve this particular problem will eventually meet with success. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

5.10 p.m.

Lord JACQUESmoved Amendment No. 2:

Page 3, line 29, at end insert— ("( ) The Director shall publish Guidance Notes in which he shall inter alia give an illustrative list of practices which may restrict, distort or prevent competition in certain circumstances").

The noble Lord said

My Lords, this amendment was discussed in Committee and I will go over the main points. First it deals with an area in which there is some conflict of interest: on the one hand, the administrator of the law prefers a general and wide definition of anticompetitive practices. He knows that circumstances and practices change; he wants to be in a position to deal with any practices which in the particular circumstances could be anti-competitive. On the other hand, the trader dislikes uncertainty. He feels that the law should be specific; he feels that if certain practices are going to be outlawed they should be specified. That is a view which I think should be respected. For my part I accept the administrators' view— the view that there should be a general and wide definition so that anti-competitive practices can be caught, even though circumstances might change and practices might change. Nevertheless, I have sympathy and respect for the trader's point of view. I think at least he should be given some guidance.

I am not trying to change the primary law or any secondary law or even asking for a code of practice. I am simply asking that the Government should issue guidance notes. This is done frequently and in fact it has almost become general practice. For example, on Thursday last, when we were discussing the National Heritage Bill, without being asked, the Minister said, "There will of course be guidance notes". All I am asking is that there should be guidance notes in the case of this Bill. I am asking that those guidance notes should give an illustrative list of practices which may restrict, distort or prevent competition in certain circumstances. But I am already fortified by the knowledge that in the working party's report which was in the Green Paper of March 1979 (Cmnd. 7512) that was contemplated, so in the opinion of the experts it is obviously practical. I believe that this is one small step to assist the trader without in any way handicapping the administrator of the law. I have pleasure in commending this amendment to the House. I beg to move.

Lord AIREDALE:

My Lords, as in Committee I just point out for the convenience of the House that I have tabled Amendment No. 49 to Clause 18 as being an alternative route to achieving the same objective as the noble Lord, Lord Jacques, is now seeking to achieve. I think it would be better if we were to discuss Amendment No. 49 not now but when we come to it. I only say this now because I hope that on this occasion I shall not be told, as I was in Committee when I moved my similar amendment, that the whole thing had been discussed on this amendment. I hope we shall have a separate discussion on Amendment No. 49.

Lord TREFGARNE:

My Lords, I must confess that I am rather disappointed that the noble Lord, Lord Airedale, made that intervention, because I was proposing to deal with this amendment and with Amendment No. 49 in the same way. But of course the noble Lord is perfectly entitled to move his amendment and to say whatever he thinks. I am now going to speak quite comprehensively on this Amendment No. 2, and the noble Lord may find himself satisfied when I sit down. Who can say?

Lord AIREDALE:

My Lords, I am only too willing to take whatever course the House thinks best and if the Minister would like to discuss my amendment at the same time and if we may treat what he has just said as an interruption so that I can continue speaking, I will outline my case on Amendment No. 49.

Amendment No. 49 is to Clause 18, which is the clause which says that the Director shall, when he considers it expedient to do so, direct himself to members of the public about the operation of the Act. My Amendment No. 49 spells out that one of the things about the operation of the Act that the Director shall mention is, any course of conduct which in his opinion constitutes an anti-competitive practice". There were two objections taken by the Government to that course of action at the Committee stage. The first was that it is not necessary for the Director to make a pronouncement of this kind, but the Government sought to have their cake and eat it, I thought, because they went on to say that if the Director was going to speak about particular anti-competitive practices he could do so in his annual report. My reply to that is that the annual report operates too slowly. Suppose the Director has reported in January and has published his annual report then; in February or March there may be brought to his attention some new gimmick which is spreading throughout a particular industry and which is an anti-competitive practice that the Director would like to see nipped in the bud, because in all these things prevention is much better than cure. If he is not going to be able to mention this until his annual report next January the trouble will have spread far too wide and prevention will have been prevented, if I may use that expression.

Surely it is much better, if the Director sees some objectionable practice arising, that he should be able to direct himself to the public and explain what it is and that he finds it objectionable. I should have thought the best answer to my Amendment No. 49 was that in fact it is unnecessary because the clause is widely drawn and virtually says that the Director may tell the public anything about the operation of the Act, which would include some particular anti-competitive practice to which he wished to draw attention.

My final word is that it was suggested in Committee that the amendment I then proposed appeared to be comprehensive and appeared to be requiring the Director to produce a comprehensive list. That was not my intention at all. Admittedly, I used the plural in the phrasing of it; I was criticised for that so I have been careful on this occasion to use the singular and I think there can now be no doubt that I am not talking about comprehensive lists at all. So, when we come to Amendment No. 49 to Clause 18, I hope that, first, I shall be able to move it formally and, secondly, it will be acceptable to the House.

Lord TREFGARNE:

My Lords, I hope your Lordships will bear with me if I speak at a little length on this amendment. In so doing I hope to set the fears of the noble Lord, Lord Airedale, at rest so that when we come to Amendment No. 49 he will not feel obliged to pursue the matter. Our objections to the principle of both these amendments is one of principle, not detail. I hope, therefore, that the House will resist these amendments, and that the noble Lord, Lord Airedale, will not press his amendment.

We have noted your Lordships' concern about the difficulty of knowing what the Director General will be investigating under his new powers in the Bill. But we do first of all think that the problem is exaggerated. Perhaps it may help if I explain how we arrive at the form of the legislation and how we expect it to operate. As I have said before, there are two main possible lines of approach to the question of how to deal with anti-competitive practices. On the one hand, one can attempt a legal definition of particular practices which are felt to be normally both anti-competitive and against the public interest, and prohibit them. Such an approach is acceptable if one is reasonably certain that the practice is normally harmful. It was followed, for example, with resale price maintenance. The other approach, the one followed in this Bill, does not assume that any named practice is invariably harmful— that is to say, that it is both anti-competitive and against the public interest. Whether it is harmful will depend on the circumstances in which it is practised. These circumstances will vary from case to case and will depend on the economic (as opposed to the legal) effect or intention of the practice.

The approach in the Bill is thus essentially agnostic a priori about any particular practice. The effect of a practice will tend to depend on whether the firm which pursues it has real market power. This requires a case by case approach, the corollary of which is that there should be no sanction against a firm for having in the past pursued a harmful course of conduct.

We do not believe that an illustrative list will be helpful, nor is it consistent with this approach. The effect could be positively misleading. The Opposition spokesman in the other place produced a list of 26 anti-competitive practices. Frankly, we thought that was a good list of potential anti-competitive practices, although there were one or two which seemed unlikely to be genuinely anticompetitive, and we could perhaps have added some others. But the most im- portant reason why we reject the idea of a list is that it could only list the practices by description; it could not specify the circumstances in which a particular practice would in fact restrict competition. This is important because what is anti-competitive in one set of circumstances might not be so in another, and whatever cautionary words are added the list of practices will tend to be regarded as generally suspect.

Because of these difficulties we came to the conclusion that our approach must be flexible, allowing each case to be judged on its merits. This approach is generally of considerable benefit to industry. Any method, however, of allowing individual circumstances to be taken into account has its problems. It cannot be as definite and dogmatic as otherwise. It was for this reason that we so designed the Bill that the Director General has to work in the open. He has to announce in public the cases he is investigating and he has to publish his report. In itself this will be a discipline on him and ensure that he is consistent and fair in his judgment; if he is guilty of maladministration the Ombudsman can investigate his action, and if he acts improperly or unreasonably his decision is subject to judicial review.

Let me give some examples of practices that may be covered and investigated by the legislation. Before doing so I must emphasise, however, that a practice may be anti-competitive in one set of circumstances but not in another. Generally speaking, a firm that is in a dominant position in a particular market will be in more of a position to act anti-competitively than one that is not. If a manufacturer producing a range of cosmetics, say, will only supply one particular type of cosmetic on condition that a retailer purchases all the others made by that manufacturer he may well be acting anti-competitively, again depending on the particular circumstances of the trade in question. If a supplier deliberately limits his distribution channels by refusing to supply potential customers, that too might be anticompetitive, again depending on the individual circumstances.

Using the economists' terms for the practices, one can mention: supply only to certain classes of trader; tie-in sales; rental-only contracts; loyalty rebates; discriminatory pricing; predatory pricing; discriminatory discounts; delivered pricing systems; and full line forcing. This is by no means a comprehensive list. I am afraid that, the ingenuity of human nature being what it is, the list of practices which may be devised to damage competition (because that is what we are discussing) could be a long one. Further, as I have stressed before, the practices are not necessarily anti-competitive. Indeed in some circumstances they may be positively pro-competitive; for example, when employed by a small firm fighting for entry to a market. One of the main considerations will be the degree of market power the firm carrying out the practice enjoys. I must also stress that the final decision whether a particular practice is anti-competitive and whether a particular anti-competitive practice is against the public interest is a matter for the MMC, not the Director General.

The object of the legislation is to encourage positive competition. There is no intention of stopping genuinely competitive efforts. Indeed, I do not believe that the genuine introductory offers of the type described by my noble friend Lady Hornsby-Smith at an earlier stage of the Bill are normally likely to be anticompetitive.

I ought also to stress that the procedures in the Bill will not require any firm to give up a practice without notice. The Director General cannot stop a practice as a result of his own investigation. Only after a Monopolies Commission report can the Secretary of State ask the Director General to seek an undertaking or can he prohibit a practice by order. Before he can do this the Commission must find that a practice is both anticompetitive and against the public interest. The procedures of the Bill (and I realise here that I may be laying myself open to charges that the procedures are too relaxed) will take some time. There is the period of the preliminary investigation by the Director General, followed by the four to eight-week period in which firms may volunteer undertakings if they choose not to face the inquiry by the Commission, followed by an inquiry by the Commission itself of up to six months. Only when all that is complete is there any question of a company being forced to stop a practice.

I accept that, at least initially, there may be come uncertainty, but this will be progressively dispelled by publication of reports of the Director General and the MMC on individual cases.

Baroness SEEAR:

My Lords, I am sorry to interrupt the noble Lord, but it is on a point of some importance which I have not got clear and it may be the House has not got clear. I understood the Minister to say that the Director General could not enforce a change; this could only be done by the MMC. That, of course, is technically correct. But in so far as the Director General can ask for an undertaking it is tantamount to enforcing, is it not? I know the company can say they will not accept it and then go to the MMC, which would be the next step, presumably. But does not this mean in practice that the Director General in a number of cases will be telling a company, or at least agreeing with a company, that a practice has to stop? This is getting very near to the Director General enforcing, surely.

Lord TREFGARNE:

No, my Lords, I think not. The fact is that for a company to be in a position where they must stop the practice that practice has to be found to be both anti-competitive and against the public interest by the MMC. If companies wish voluntarily to give undertakings before that stage is reached they are free to do so, and the Bill provides for that. But it is not true to say that the Director General can order the company to give up a practice, because the company can insist, and no doubt many will, that their case should be taken before the MMC.

I do not think that any useful purpose will therefore be served by this amendment to Clause 2 or by the Clause 18 amendment of the noble Lord, Lord Airedale. Clause 18 already places a clear duty on the Director General to disseminate such information as he considers appropriate, and I think it entirely right that he should give as much guidance to industry as he can. This may well be informal advice, as I have said before, to individual firms, though we must recognise that it will often not be possible for that advice to be categorical, since it may well not be clear to him, without an investigation, what the true facts are. He already publishes a lot of information about his powers under other legislation, and this has, I believe, been found by industry to be useful.

The Director General has assured us that he will continue to do so under this legislation and will give as much guidance on anti-competitive practices as he reasonably can. Such information would refer, wherever possible, to the circumstances in which practices may be anti-competitive. He cannot, however, be expected to give an exhaustive description of every circumstance in which every practice will or will not be anti-competitive. That would be impossible, but he will do what he can both formally and informally.

I apologise for the length of my remarks. I hope that they will have helped your Lordships to see why we have proceeded in the way in which we have and will reassure your Lordships that guidance will be given, and persuade your Lordships that these two amendments ought not to be included in the Bill.

Lord WALLACE of COSLANY:

My Lords, before the noble Lord, Lord Trefgarne, sits down there is one small point that I should like to raise with him in a friendly manner. Will he kindly refrain from verbal shorthand? I have had anxious inquiries regarding the MMC. I have given the right information, but many noble Lords may not understand what those initials mean.

Lord TREFGARNE:

My Lords, I apologise to the noble Lord and to the House. The MMC is the Monopolies and Mergers Commission.

Lord JACQUES:

My Lords, it was never suggested that the illustrative list would be exhaustive or that in all circumstances the practices that were illustrated would be anti-competitive. That was made clear in the Green Paper of March 1979. The whole of the Government's defence has been based upon the question of illustrative practices and the wisdom or otherwise of publishing a list. Would the Government accept the need for issuing guidance notes, in general, without reference to any illustrative practice in so far as the Director General may feel that that should be part of it? It is general practice, as regards other legislation, to have guidance notes. Would the Government not accept that there should be guidance notes, and leave it at that?

Lord TREFGARNE:

My Lords, I think that the noble Lord, Lord Jacques, is hoping for me to say something more, and with the leave of the House I should like to do so. I am not sure how I would describe the information that is to be published by the Director General if it is not to be by guidance notes. I fancy that that is just what it would be.

Lord JACQUES:

My Lords, I would regard that as an interruption. I am strongly tempted to divide the House. I take the view that the Government are acting unreasonably in not being prepared to issue guidance notes and probably the time has come when those who support this unreasonableness should be counted. However, having put this amendment in principle during the Committee stage and lost it there, 1 shall have to leave the matter at that. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

5.35 p.m.

Lord STANLEY of ALDERLEY moved Amendment No. 3:

Page 4, line 4, at end insert— ("(9) For the purposes of this Act a course of conduct is not an anti-competitive practice if it constitutes an agreement which is excluded from the application of the Restrictive Trade Practices Act 1976 by virtue of section 33 of that Act (Agricultural and Forestry Associations, and Fishery Associations).").

The noble Lord said

I beg to move Amendment No. 3. My reason for moving this amendment, which is the same as the one I moved in Committee, is to give the Government an opportunity to enlarge upon the promise to help to resolve the problem of agricultural co-operatives trying to operate under the Bill. 1 shall not bore the House by repeating all that I said in Committee, but would merely say that, if the Bill is left as it is, agricultural co-operatives would be at a disadvantage compared to others. I would also repeat that, if any agricultural cooperative attempts any restrictive or uncompetitive action, it can be controlled at present under the Restrictive Trade Practices Act, and indeed by Ministerial Order. Therefore, I hope that the Govern-will feel inclined to accept my amendment.

Lord TREFGARNE:

My Lords, we have given considerable thought to this matter since it was raised by my noble friend in Committee. We accept and wish to encourage the co-operative principle in agriculture, fisheries and forestry, and would not wish action under the Bill to undermine that encouragement. We do not regard it as desirable for those courses of conduct pursued by agricultural cooperatives and their members which constitute, and do no more than constitute, the provision by co-operatives of services to their members and the carrying out by members of their commitments to trade with or through their co-operatives, to be investigated under the Bill. We therefore intend to take the opportunity under Clause 2(3) to exempt these aspects of agricultural co-operatives from the definition of anti-competitive practices which may be investigated under the Bill. That would leave it open, however, for conduct of a kind which was genuinely anti-competitive and potentially undesirable, which represented an abuse of a strong market position, to be considered under the Bill. Therefore, I hope that my noble friend will feel able to withdraw his amendment in the light of that assurance.

Lord MOTTISTONE:

My Lords, I hope that the closing remarks of my noble friend on the Front Bench mean that, whatever is done under Clause 2(3), it will be quite certain that the activities of these co-operatives are fully treated in a similar anti-competitive fashion to the activities of any other trader with whom they may be in competition. I would be grateful if my noble friend could reassure me on that particular point.

Lord TREFGARNE:

My Lords, with the leave of the House, I should like to say: Yes, I can give that assurance.

The Earl of CAITHNESS:

My Lords, I should like to ask my noble friend when he proposes to introduce the appropriate amendment so that we can see the exact wording under Clause 2, as promised.

Lord TREFGARNE:

My Lords, I apologise for intervening yet again, because this is a Report stage. The answer is that it will not be an amendment to the Bill: it will be an order made under the Bill, and I am afraid I cannot produce that for my noble friend's inspection at this stage.

Lord STANLEY of A LDERLEY:

My Lords, I must be honest— and it is not very often that I am— and say that I did not expect to get so much sympathy and understanding from the Government when I originally tabled the amendment. I am therefore very grateful to them. As I understand it, we shall have an order after the Act has been published. Of course, I need hardly tell them— and 1 hope that the wine does not turn sour in their mouths— that I would have preferred my amendment, because that tics the Ministers down. But, believe it or not, I understand the difficulty that, if the Government accepted my amendment, they might offend my noble friend Lord Mottistone, which I would not like to do. I hope that the Government's attitude of generosity and thought will be displayed when I move my next amendment, No. 17. I beg leave to withdraw— —

Lord ORAM:

My Lords, before the noble Lord, Lord Stanley of Alderley, asks leave to withdraw his amendment, I wonder whether we can have from the noble Lord some information as to whether the order that will be introduced will be an affirmative order or will be subject to the Negative Resolution procedure? In other words, I am asking whether the House will have an opportunity at some point of examining the nature of the order that is to be brought in.

Lord TREFGARNE:

My Lords, I apologise for speaking yet again. I am speaking without a note, but my recollection is that these orders are not subject to either Negative or Affirmative Resolution procedure.

Amendment, by leave, withdrawn.

Clause 3 [Preliminary investigation by Director of possible anti-competitive practice]:

5.40 p.m.

Baroness SEEAR moved Amendment No. 4: Page 4, line 7, after ("the") insert ("Director shall afford him an opportunity to make representations within such a period as the Director considers reasonable in the circumstances, and after taking into account any representations made to him the").

The noble Baroness said: My Lords, this amendment is similar to one that I moved unsuccessfully at the Committee stage. Its purpose is quite simply to give appropriate protection to the person who may be investigated. This is based on the belief that the knowledge that an investigation will take place can be detrimental to the person being investigated, and that it is reasonable that he should have the opportunity to make representations before it is announced that an investigation is to take place. I beg to move.

Lord AIREDALE:

My Lords, I should like to support this amendment. From time to time it must happen to all of us that we hear of a complaint against someone and at first sight it looks a very serious complaint. But we learn by experience not to decide flatters without hearing both sides of the case. Sometimes when we hear the version of the person complained against we emerge with a very different picture of the seriousness of the matter complained about. What happens to all of us from time to time is also likely to happen to the Director from time to time. It might be rather unwise for the Director ever to launch out into an investigation without giving the person complained about on opportunity to make representations.

Lord TREFGARNE:

My Lords, the point made in this amendment is, I think, very similar indeed to that being made in Amendment No. 5, which follows, and which the noble Lord, Lord Wallace of Coslany, and his friends are moving. However, I shall speak to this amendment and if I can say any more later, I shall do so.

As I think I said at the previous stage, I have some sympathy with the underlying purpose behind this amendment, but I do not believe that it is either desirable or necessary. The purpose of the Director General's initial formal investigation is to find out quickly what is going on, to see whether it is worth referring a firm to the Monopolies Commission for a full investigation. There is nevertheless and inevitably a certain amount of formality written into the Bill about this preliminary

investigation. It is undesirable now to add a further formal stage before the preliminary inquiry begins. As I said on an earlier amendment, the procedures in the Bill are quite long and drawn out enough as it is, and I do not think that we should add to them.

It is already open to the Director General to contact firms before mounting his preliminary investigation. I can assure your Lordships that, wherever possible, the Director General will carry out preliminary inquiries with a firm he is considering investigating and that firm will have the opportunity at that time to make representations. Therefore, I hope that the noble Baroness and the noble Lord will not wish to press their amendment.

Baroness SEEAR:

y Lords, I am sorry to disappoint the Minister but it seems to me that since, as he says, there are in any case a certain number of preliminaries to be gone into— and we are not asking for a long delay— the need to protect the individual organisation against what could be serious damage is such that I am afraid I must divide the House.

Lord WALLACE of COSLANY:

My Lords, the noble Lord rather implied that my Amendment, No. 5, is on the same point as Amendment No. 4. In point of fact it is not. Later on I shall speak about representations being made to the Director about possible investigations that he might make on behalf of consumers. I shall deal with that point later. It has nothing whatever to do with the point, with which I agree, made by the noble Baroness, Lady Seear, and the noble Lord, Lord Airedale.

Lord TREFGARNE:

My Lords, again with the leave of the House, if I misinterpreted the amendment, I shall deal with it in a moment.

5.44 p.m.

On Question, Whether the said amendment (No. 4) shall be agreed to?

Their Lordships divided: Contents, 60; Not-Contents, 67.

CONTENTS
Ailesbury, M.	Barrington, V.	Brooks of Tremorfa, L.
Airedale, L.	Birk, B.	Cledwyn of Penrhos, L.
Ardwick, L.	Blease, L.	Collison, L.
Avebury, L.	Blyton, L.	Cooper of Stockton Heath, L.
Aylestone, L.	Boston of Faversham, L.	David, B.
Banks, L.	Brockway, L.	Davies of Leek, L.
Diamond, L.	Lloyd of Kilgerran, L.	Stedman, B.
Elwyn-Jones, L.	Longford, E.	Stewart of Alvechurch, B.
Gladwyn, L.	Lovell-Davis, L.	Stewart of Fulham, L.
Glenamara, L.	McCarthy, L.	Stone, L.
Gordon-Walker, L.	Monson, L.	Swaythling, L.
Goronwy-Roberts, L.	Northfield, L.	Tanlaw, L.
Granville of Eye, L.	Oram, L.	Taylor of Mansfield, L.
Hale, L.	Peart, L.	Wallace of Coslany, L.
Hampton, L.	Ponsonby of Shulbrede, L. [Teller.]	Wedderburn of Charlton, L
Harris of Greenwich, L.		Whaddon, L.
Henderson, L.	Sainsbury, L.	Wigoder, L.
Jacques, L.	Seear, B.[Teller.]	Willis, L.
Kilmarnock, L.	Sefton of Garston, L.	Wynne-Jones, L.
Kirkhill, L.	Segal, L.
Llewelyn-Davies of Hastoe, B.	Simon, V.
NOT-CONTENTS
Allen of Abbeydale, L.	Grimston of Westbury, L.	Orkney, E.
Alport, L.	Hailsham of Saint Marylebone, L. (L. Chancellor.)	Orr-Ewing, L.
Atholl, D.		Penrhyn, L.
Avon, E.	Halsbury, E.	Renton, L.
Belstead, L.	Henley, L.	Rochdale, V.
Caithness, E.	Hives, L.	Romney, E.
Campbell of Croy, L.	Hylton-Foster, B.	St. Just, L.
Cullen of Ashbourne, L.	Killearn, L.	Saint Oswald, L.
Daventry, V.	Kilmany, L.	Sandford, L.
de Clifford, L.	Kinnaird, L.	Sandys, L.[Teller.]
Denham, L.[Teller.]	Lauderdale, E.	Selborne, E.
Drumalbyn, L.	Long, V.	Sempill, Ly.
Ebbisham, L.	Lyell, L.	Stanley of Alderley, L.
Eccles, V.	McFadzean, L.	Strathclyde, L.
Elliot of Harwood, B.	Mackay of Clashfern, L.	Strathspey, L.
Elton, L.	Macleod of Borve, B.	Trefgarne, L.
Exeter, M.	Mancroft, L.	Trenchard, V.
Fraser of Kilmorack, L.	Mansfield, E.	Vaux of Harrowden, L.
Gainford, L.	Margadale, L.	Vickers, B.
Galloway, E.	Mowbray and Stourton, L.	Vivian, L.
Gibson-Watt, L.	Newall, L.	Westbury, L.
Godber of Willington, L.	Northchurch, B.	Willoughby de Broke, L.
Gowrie, E.	Nugent of Guildford, L.

Resolved in the negative, and amendment disagreed to accordingly.

5.53 p.m.

Lord WALLACE of COSLANYmoved Amendment No. 5: Page 4, line 7, after ("Director") insert ("after taking into account any representations made to him").

The noble Lord said: My Lords, as I have already indicated, this is not the same as Amendment No. 4, which has just been narrowly defeated. In the Committee stage, as the House will recall, I moved a more comprehensive amendment designed to ensure that representative bodies of consumers could make representations to the Director. The noble Lord, Lord Trefgarne, said in reply that he agreed that everybody ought to have the right of approach to the Director General with their representations. He further stated that under the Bill as drafted the Director General is entirely free to take any representations into account when selecting cases for investigation.

This may be so, although I am not at all satisfied that the Bill as drafted says so; yet I grant that it may be sincerely held by the Government to be their intention.

The amendment accepts the Government's intention and simply clarifies the position in a few simple words. The operative word is "any". There would be occasions when the Director would take action without representations being made to him, 'but the amendment makes it clear that representations could be made and that the Director could take them into account. I do not wish to labour the point unduly, but I honestly feel that there is an important principle at stake: the right of citizens to make representations to authorities.

I have strong personal views on this. During the many years I have served in public life I have always defended the right of people to express their views to authority, and I have always put their views although at times I may not personally have agreed with them. This is the democratic right, and it perhaps explains why I am so keen about this amendment. I hope that the Government will accept this simple amendment. We have disposed of the Price Commission issue, and our purpose is constructively to improve the Bill. The amendment is intended to do that, no more and no less. I beg to move.

Lord MOTTISTONE:

My Lords, I should like to support this amendment, even if talking from these Benches. It seems to me that it is important. It comes back to the fundamentals we went into in Committee, and I am not going to repeat it all now. It is important on this initial stage of an investigation when undertaken in this connection that the maximum protection should be given to the people who are the targets of the investigation, to cover them in the event that the investigation turns out to be unnecessary; to cover them in the event that they give an undertaking, or perhaps several undertakings, to make sure that they themselves are protected as much as possible because they are going to get publicity. That I fear we have to accept, and the debates we had at Committee stage rather made this point.

Whereas I did not agree with the previous amendment because it invited people to make representations, this makes allowance for the fact that if somebody so cares to make representations then proper account must be taken of them. It seems to me that this is a sensible amendment, which the Government might well consider worthy of inclusion in the Bill.

Lord TREFGARNE:

My Lords, I am afraid not. We did, in all fairness, go through this matter at considerable length at Committee stage. Indeed, there was a Division on a similar amendment. Again, may I say that I have sympathy with the underlying purpose, but I think the amendment is unnecessary. It is already open to the Director General to hear representations from people as to what he should investigate. Indeed, one would imagine that complaints would form an important, possibly the principal, source of information prior to an investigation. We think it is quite unnecessary to write anything further into the Bill for this purpose. I think that the fears of the noble Lord, Lord Wallace, and particularly of my noble friend Lord Mottistone, are unfounded. I hope therefore that the noble Lord, Lord Wallace, will not press his amendment.

Lord WALLACE of COSLANY:

My Lords, I am going to disappoint the noble Lord because in point of fact I cannot see why on earth the Government cannot accept this small amendment. He may say, quite rightly, that the Director General has powers to receive representations; but it is not in this Bill. If I remember correctly, it is under the Fair Trading Act. Therefore, if it is not in this Bill, and the Government need to reassure the public generally as well as the people affected by any possible change, and those who wish to make representations about anti-competitive practices, then the Government in all decency should put it in the Bill. I do not understand why the Government will not accept the amendment. Up to this stage in debating the Bill we have had nothing but a stonewalling defence from them. Noble Lords on the Front Bench opposite would make excellent Boycotts in cricket in stonewalling against the bowling.

Lord TREFGARNE:

My Lords, what is there in the Bill to prevent people or firms making representations to the DG?

Lord WALLACE of COSLANY:

My Lords, for the very simple reason, to put it in vulgar terms, "it ain't in the Bill". People must have clear rights in legislation of this sort which affects the consumer and producer. It is not in the Bill and the Minister must now admit it is not, so why not insert it?

Lord AIREDALE:

My Lords, the noble Lord, Lord Wallace of Coslany, has made an important point. If it is the case, as the noble Lord says it is, that in some other Act with rather similar objectives it is written in that the director shall receive representations, and if that is left out of this Bill, distinctions will be drawn and it will be said that if Parliament had intended the director under this measure to receive representations, Parliament would have said so, in the same way that Parliament said so in the other Act. It is important to have consistency to prevent lawyers from finding discre- pancies and exploiting them and I therefore urge the Government to reconsider the point and give way on this amendment.

Viscount TRENCHARD:

My Lords, may I ask the noble Lord, Lord Airedale in which other Act or Acts he believes this phrase— that an authority, a director, should receive representations— is included'? I have just asked the gentlemen of great knowledge what the other Acts are and they could not tell me of one.

Lord AIREDALE:

My Lords, I was taking up a point which the noble Lord, Lord Wallace of Coslany, made when he said that in some other Act— did he say the Fair Trading Act?— these words were included.

Viscount TRENCHARD:

My Lords, may I ask the noble Lord, Lord Wallace of Coslany, what other Acts he is referring to?

Lord WALLACE of COSLANY:

My Lords, I was going back to what the noble Lord, Lord Trefgarne, said in Committee, and he said it was in the Fair Trading Act.

Viscount TRENCHARD:

I am sure it is not in any other Acts, my Lords, or at any rate my advisers cannot tell me of any, and in view of that I would urge the noble Lord not to divide the House on, if I may say so, a rather platitudinous statement that a director general should be open to representations when clearly he will be open to representations.

Lord WALLACE of COSLANY:

No, my Lords, I cannot accept that position. If it is not in any other Act— and we can quarrel about that later, and it certainly was said— then it should be in this Bill. There is no argument about that and the Government should not be afraid of creating a small precedent. If the Government will not give way on this, I must force a Division.

6.4 p.m.

On Question, Whether the said amendment (No. 5) shall be agreed to?

Their Lordships divided: Contents, 60; Not-Contents, 75.

CONTENTS
Airedale, L.	Glenamara, L.	Peart, L.
Avebury, L.	Gordon-Walker, L.	Ponsonby of Shulbrede, L. [Teller.]
Aylestone, L.	Goronwy-Roberts, L.
Banks, L.	Greenwood of Rossendale, L.	Sainsbury, L.
Barrington, V.	Hale, L.	Seear, B.
Birk, B.	Hampton, L.	Sefton of Garston, L.
Blease, L.	Harris of Greenwich, L.	Simon, V.
Boston of Faversham, L.	Henderson, L.	Stedman, B.
Brockway, L.	Hornsby-Smith, B.	Stewart of Alvechurch, B.
Brooks of Tremorfa, L.	Jacques, L.	Stewart of Fulham, L.
Bruce of Donington, L.	Jeger, B.	Stone, L.
Cledwyn of Penrhos, L.	Kaldor, L.	Strabolgi, L.
Collison, L.	Kilmarnock, L.	Swaythling, L.
Cooper of Stockton Health, L.	Kirkhill, L.	Taylor of Mansfield, L.
Davies of Leek, L.	Llewelyn-Davies of Hastoe, B.	Wallace of Coslany, L.[Teller.]
Davies of Penrhys, L.	Lovell-Davis, L.	Wedderburn of Charlton, L.
Diamond, L.	McCarthy, L.	Wigoder, L.
Donaldson of Kingsbridge, L.	Monson, L.	Willis, L.
Elliot of Harwood, B.	Mottistone, L.	Wynne-Jones, L.
Elwyn-Jones, L.	Northfield, L.
Gladwyn, L.	Oram, L.
NOT-CONTENTS
Allen of Abbeydale, L.	Craigavon, V.	Exeter, M.
Alport, L.	Cullen of Ashbourne, L.	Fraser of Kilmorack, L.
Atholl, D.	Daventry, V.	Gainford, L.
Avon, E.	de Clifford, L.	Galloway, E.
Bellwin, L.	Denham, L.[Teller.]	Gibson-Watt, L.
Belstead, L.	Drumalbyn, L.	Gowrie, E.
Boyd of Merton, V.	Duncan-Sandys, L.	Grimston of Westbury, L.
Caithness, E.	Ebbisham, L.	Hailsham of Saint Marylebone, L. (L. Chancellor.)
Campbell of Croy, L.	Eccles, V.
Carrington, L. (A Principal Secretary of State.)	Elles, B.	Halsbury, E.
	Elton, L.	Henley, L.
Hives, L.	Mowbray and Stourton, L.	Sempill, Ly.
Holderness, L.	Newall, L.	Sherfield, L.
Hylton-Foster, B.	Northchurch, B.	Stanley of Alderley, L.
Kilmany, L.	Nugent of Guildford, L.	Strathclyde, L.
Kinnaird, L.	Orkney, E.	Stracona and Mount Royal, L.
Lauderdale, E.	Orr-Ewing, L.	Strathspey, L.
Long, V.	Penrhyn, L.	Swansea, L.
Lyell, L.	Renton, L.	Trefgarne, L.
McFadzean, L.	Rochdale, V.	Trenchard, V.
Mackay of Clashfern, L.	Romney, E.	Vaux of Harrowden, L.
Macleod of Borve, B.	St. Aldwyn, E.	Vickers, B.
Mancroft, L.	St. Just, L.	Vivian, L.
Mansfield, E.	Sandford, L.	Westbury, L.
Margadale, L.	Sandys, L.[Teller.]	Young, B.
Morris, L.	Selborne, E.

Resolved in the negative, and amendment disagreed to accordingly.

6.13 p.m.

Lord MOTTISTONE moved Amendment No. 6:

Page 6, line 16, at end insert— ("(11) Where a report is published under subsection (10) above, it shall in the first instance be provided only to the Secretary of State and to the person or persons concerned. If the Director accepts an undertaking in accordance with subsection (3) of section 4 below the report or any part of it may not subsequently be made public where, subject to section 16(1), the Director and person or persons concerned have reached agreement to restrict the publication of all or any part of it.").

The noble Lord said: My Lords, my amendment was put down in desperation at not having received a letter from my noble friend, but a letter later arrived, and I do not wish to press this matter. The arguments involved were well rehearsed at the Committee stage, but this would perhaps be a good opportunity for my noble friend to say publicly what he said to me in his letter, which is not entirely satisfactory, but which is perhaps acceptable under the circumstances. I beg to move.

Lord TREFGARNE

My Lords, in the light of those very helpful opening remarks, may I say that I am happy to repeat the assurance that I gave to my noble friend in a letter and which has been given by the Director General; namely, that he would always give the firms concerned an opportunity to see the factual parts of his report before it was finalised and published. I hope that in the light of that assurance my noble friend, as he foreshadowed, will not press his amendment.

Lord MOTTISTONE

My Lords, I beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

Clause 5 [Competition references]:

Lord MOTTISTONE moved Amendment No. 7: Page 8, line 35, leave out ("not exceeding twelve weeks").

The noble Lord said: My Lords, with the permission of the House I should like to take with this amendment Amendment No. 8 as well, the two being related. These amendments are designed to get over a particular situation which might arise when there is a conflict between speed and thoroughness, as was well discussed in committee. The object of the amendments is to extend the period in which undertakings are negotiated and the decision finally taken by the Director on whether to make a competition reference to the Monopolies and Mergers Commission. The Bill provides for a period of eight weeks extendable to 12 weeks for the negotiation of undertakings following an adverse Director's report. The period may be too short. As the Director said on page 9 of his annual report for 1978, in connection with undertakings in respect of restrictions in registrable amendments: Particularly when long-standing practices are at stake, the parties to an agreement need to think through the consequences of giving up restrictions. This calls for much patient discussion between the parties and my staff".

The procedure laid down in the Bill could conceivably lead to a situation in which both parties— the Director and the company— wish to agree on a suitable undertaking but perhaps because of the complexity of the matters are unable to finalise the details in the time period. In such a situation the Director would have no alternative, but to refer the case to the Monopolies and Mergers Commission. We consider that that is undesirable for all concerned, and accordingly I beg to move.

Lord TREFGARNE

My Lords, as my noble friend said, we discussed this matter previously, but may I say that the onus is entirely on the firm to decide whether to offer an undertaking, and it is important that the procedure should not be used as a means of prevarication or delay by firms. Even where both the Director General and the firm may consider that a negotiation is likely to succeed if it is allowed, say, a further eight weeks or 12 weeks beyond the eight weeks originally specified, there can be no certainty that this will prove to be the case even where the firm is not deliberately trying to use the procedure as a means of delaying action. We are most anxious that it should not be used as an excuse for delay, and we regard 12 weeks as the absolute limit if the procedure is not to lose credibility. I hope that my noble friend will not press his amendment.

Lord MOTTISTONE

The object of the amendment is to cover a situation where there is agreement. Amendment No. 8 refers to the agreement of the person or persons and this would involve the agreement also of the Director General. As I said when I introduced the amendment, the Director General himself has had this problem under somewhat similar circumstances and has commented upon it in his report. I wonder whether the Government really wish to reject this out of hand, or whether they might consider an amendment of their own at Third Reading to allow for this particular situation when there is agreement by both sides and the matter is a complex one. I should have thought that there might be an opening there.

Lord TREFGARNE

My Lords, I do not want to seem inflexible in these matters. I am speaking to Amendment No. 7, although I recognise that my noble friend referred also to Amendment No. 8. If my noble friend was speaking to Amendment No. 8 only, I might have been better able to accommodate him, but as it is I am prepared to give an undertaking to consider this matter further and to consult him before the next stage of the Bill.

Lord MOTTISTONE

My Lords, that is extremely generous, and with that undertaking I beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

[Amendment No. 8 not moved].

Clause 8 [Conclusions and reports of the Commission]:

Lord JACQUES moved Amendment No. 9:

Page 12, line 39, at end insert— ("(6) When in the opinion of the Commission a person has been put to unnecessary and unreasonable expense because the reference should never have been made to the Commission, the Secretary of State shall refund those expenses.").

The noble Lord said: My Lords, when I moved this amendment at the Committee stage the noble Lord, Lord Mottistone, told the Committee that in an earlier year, 1977, he had moved a similar amendment and that I, as a Member of the last Government, had rejected it. I said that I had no recollection of that, and I invited the noble Lord to produce the relevant Hansard. I want to deal with this point first because it puts my amendment in proper perspective. The noble Lord not only produced the relevant Hansard, but he handsomely apologised, because the Member of the Government who dealt with that particular amendment was not me; it was someone else. But that is of no significance, and I do not want to deal with it.

I want to deal with the noble Lord's amendment and contrast it with the present amendment. His amendment was an amendment to the Price Commission Bill, and he sought to make the Government responsible for a company's total expenses when there was an investigation by the Price Commission. Presumably the Government were to be required to pay, whether or not the investigation was deserving. The noble Lord said it was a probing amendment. I think that if one reads the report in Hansard one will come to the conclusion that it was a protesting amendment— protesting against expenses being inflicted upon companies by legislation. I have kept my ear to the ground since there has been a change of Government, and I have heard far fewer protests from the noble Lord about the same aspect. In fact, in the case of this Bill he is not protesting at the very same thing.

The amendment which the noble Lord moved on that occasion was one which no Government could accept. It would have created a precedent which would be completely unacceptable. Under this Bill, the Price Commission is abolished, and for the purpose of investigations the Director General takes the place of the Price Commission. Under Clause 3 of the Bill the Director General can investigate. I have not suggested that any expenses incurred by a company arising out of such an investigation should be borne other than by the company itself, so that there ends the comparison which the noble Lord sought to make. I am not dealing with investigations, as he was dealing with investigations.

In this Bill, after the investigation by the Director General there is a further stage. The Director General can refer the matter to the Monopolies and Mergers Commission. The Commission will be obliged by statute, if this Bill becomes a statute, to make its inquiries. I therefore contend that the inquiry by the Monopolies and Mergers Commission is a statutory inquiry by that Commission, and I contend that the award of costs should follow the report of the Council on Tribunals on the Award of Costs at Statutory Inquiries, 1964 Command Paper 2471 — and as your Lordships will see, the amendment is worded precisely to agree with the report of that council. Recommendation No. 4 is as follows: Costs should normally be awarded against a party who behaves unreasonably, vexatiously or frivolously". Recommendation No. 5— and this is important because the amendment is based upon it— says: In considering what constitutes unreasonable behaviour justifying an award of costs, the main criterion is whether a party has been put to unnecessary and unreasonable expenses because the matter should never have come to inquiry ", Your Lordships will see that the amendment is precisely worded to agree with the council's recommendations.

What it means is this. The question of the award of costs does not arise when there is simply an investigation by the Director, but when there is an inquiry by the Monopolies and Mergers Commission costs shall be awarded in accordance with the 1964 report of the council dealing with such costs. That does not mean that if a party wins a case he will necessarily be awarded costs. He will be awarded costs only if he wins a case and, in addition, the Director General, in referring to the Commission, has acted unreasonably and in accordance with the definition laid down by the council itself. That is what the amendment means and I have pleasure in moving it in the hope that, because it is so reasonable, it will be accepted by the Government. I beg to move.

Lord MOTTISTONE

My Lords, I feel I must now speak and apologise very deeply, both to the House and to the noble Lord, Lord Jacques, for the mistake that I made in misquoting him as my opponent in the debate on 12th July 1977, which is fully reported in cols. 849 to 852. The noble Lord with whom I was jousting was in fact the noble Lord, Lord Oram, and I hope noble Lords will forgive me because on those occasions, in 1976 and 1977 particularly, the two noble Lords were frequently representing the Government on the Front Bench and taking Bills alternately, and one never quite knew who was dealing with which. My memory let me down, and I apologise.

It also let me down in another respect, and that was that I opened with the remark that it was a probing amendment, so there was therefore no question of being shot down by the noble Lord, Lord Oram, or anybody else, because I was not even asking to be shot. However, it was a probing amendment. It was a probing amendment with a purpose, because I believe that, as to the amendment that the noble Lord, Lord Jacques, has now moved and the one that I put down before — mine may have been much too broad, but I would have thought that his, perhaps, is not ideal— the principle of the thing is getting to be more and more important. I think there may be other opportunities— perhaps not now, but certainly as bodies are set up— for it to be an accepted practice that, under the appropriate circumstances (and I think that the noble Lord, Lord Jacques, made quite a good point on this), companies could expect to be recompensed for the amount of money they spend in helping public bodies to comply with Acts of Parliament.

Companies spend millions of pounds— I have mentioned this earlier on this particular subject— or have done, when dealing with inquiries from the Price Commission. They also spend similar sums of money for an ordinary inquiry by the Monopolies and Mergers Commission. Obviously, there must be freedom (if you like) for people like the Director General and the Monopolies and Mergers Commission itself to operate freely if a job has to be done under the terms of whatever Act of Parliament we are dealing with, and, to that extent, if it is said that the Government would always pay a share of the cost of the thing it may be that this would be a restraint. It may be that this would mean that the Government of the day would have to say to the Director General, "Go easy on the number of cases you bring because we have not got enough spare cash". I am over-simplifying it, but that is the principle of it.

The fact of the matter is that there is also a need to consider the problems of the unfortunate companies, and in civil law this gets resolved with the apportionment of costs. Very recently a valuation officer who had a particular view about rateable values of a certain piece of equipment lost his case against a section of industry and, as a result of that, the Government had to pay costs. I think that was right and reasonable, because the companies had been involved in something for which they had to pay, which was in effect keeping the law and helping the law to be enforced. So we are on a rather special sort of issue, which I believe is so special and so general that it is not really the subject for putting clauses into Bills where it comes up, like this— and I think I was probably at fault earlier on in trying it on the Price Commission Act, as it became.

I would have thought that this was something which is sufficiently important and general for the Government to be prepared to introduce proper and special legislation for the purpose, and I shall be very interested to know whether my noble friend will consider that as being a possible way out of this dilemma.

Viscount SIMON

My Lords, before the noble Lord replies, may I be allowed to ask the noble Lord, Lord Jacques, if he has the permission of the House, to elucidate one point? He, and to some extent the noble Lord, Lord Mottistone, seem to have talked exclusively about legal costs. I take the amendment as drafted to be much wider than that, to include expenses that might have been incurred as a result of the original reference. Will the House give the noble Lord, Lord Jacques, permission to speak again to elucidate that point?

Lord SWAYTHLING

My Lords, before the noble Lord, Lord Jacques, replies, can he explain why he used in the amendment the words "unnecessary and unreasonable expenses "? It appears to me that if the expenses are unnecessary they would automatically be unreasonable and, if unreasonable, they would be automatically unnecessary. It is always better to have as short a statement as possible in the law and I should have thought it better to have only one expression.

Lord JACQUES

My Lords, with the permission of the House, may I repeat what the report said? It was a report of the Council on Tribunals on The Award of Costs at Statutory Inquiries.

A noble Lord: My Lords, legal costs.

Lord JACQUES

My Lords, it did not say legal costs. Recommendation No. 5 reads: In considering what constitutes unreasonable behaviour justifying an award of costs, the main criterion is whether a party has been put to unnecessary and unreasonable expenses because the matter should never have come to inquiry". All I have done is to copy the recommendation of the Council on Tribunals.

Lord TREFGARNE

My Lords, since our debate in Committee on a very similar amendment to this one, we have looked at this matter again, as I undertook. But I have to tell the House that the amendment remains unacceptable. The report of the Council on Tribunals on the Award of Costs at Statutory Inquiries, on which, I think, the noble Lord, Lord Jacques, relies, dealt primarily with planning inquiries and recommended the awarding of costs in the terms that the noble Lord has described. Planning inquiries and other statutory inquiries by their nature deal with cases where there are direct disputes and conflicts of interest between parties. This is not the case under this Bill. Once a reference had been made to the commission it is the commission's function to investigate and report on the practice before them to decide whether it is being pursued,whether it is anti-competitive and whether it is against the public interest. The Director General of Fair Trading is not a party to the proceedings, which should not be seen as a dispute between him and the firm concerned.

So far as investigations under the Bill are concerned, I would remind the House that there are a very great number of safeguards built into the procedures under the Bill. I recited those under an earlier amendment. I should like, however, to make one further remark in relation to costs generally. This is important. It may be suggested that firms whose behaviour is not anti-competitive or not against the public interest should have their costs reimbursed. However, this is only half the picture. At present, the Government, and hence the taxpayer, bears the full costs of the commission's own expenses in conducting its inquiries under the Fair Trading Act as well as, in future, under this Bill, the cost of publishing the commission's reports.

Third parties in proceedings bear their own costs.

If the principle whereby each party bears its own costs is changed, I think we should have to consider very carefully whether parties who are found to be behaving in a way which is against the public interest should not themselves bear the costs to the taxpayer of the inquiries, and, perhaps, also, the costs to third parties. There may well be an element of rough justice in the present system but it is far from clear that there are real benefits in attempting to obtain a finer balance. I hope that the noble Lord will not press his amendment.

Lord JACQUES

My Lords, I believe that if the Commission come to the view that a case ought never to have been referred to it, the Director General will have acted unreasonably and the Secretary of State should bear the costs. I shall press the amendment.

6.34 p.m.

On Question, Whether the said amendment (No. 9) shall be agreed to?

Their Lordships divided: Contents, 48; Not-Contents, 76.

CONTENTS
Airedale, L.	George-Brown, L.	Oram, L.
Avebury, L.	Gladwyn, L.	Peart, L.
Aylestone, L.	Glenamara, L.	Ponsonby of Shulbrede, L.
Banks, L.	Gordon-Walker, L.	Seear, B.
Barrington, V.	Hale, L.	Simon, V.
Birk, B.	Hampton, L.	Stewart of Alvechurch, B.
Blease, L.	Henderson, L.	Stewart of Fulham, L.
Boston of Faversham, L.	Houghton of Sowerby, L.	Stone, L.
Brockway, L.	Jacques, L.[Teller.]	Strabolgi, L.
Brooks of Tremorfa, L.	Kaldor, L.	Swaythling, L.
Cledwyn of Penrhos, L.	Kilmarnock, L.	Taylor of Mansfield, L.
Collison, L.	Kirkhill, L.	Wallace of Coslany, L.[Teller.]
Davies of Leek, L.	Llewelyn-Davies of Hastoe, B.	Wedderburn of Charlton, L.
Diamond, L.	McCarthy, L.	Whaddon, L.
Donaldson of Kingsbridge, L.	Monson, L.	Wigoder, L.
Elwyn-Jones, L.	Northfield, L.	Willis, L.
NOT-CONTENTS
Alport, L.	Drumalbyn, L.	Grimston of Westbury, L.
Atholl, D.	Duncan-Sandys, L.	Hailsham of Saint Marylebone, L. (L. Chancellor.)
Avon, E.	Ebbisham, L.
Bellwin, L.	Eccles, V.	Henley, L.
Belstead, L.	Elles, B.	Hives, L.
Boyd of Merton, V.	Elliot of Harwood, B.	Holderness, L.
Caithness, E.	Elton, L.	Hornsby-Smith, B.
Campbell of Croy, L.	Exeter, M.	Hylton-Foster, B.
Carrington, L. (A Principal Secretary of State.)	Fraser of Kilmorack, L.	Kilmany, L.
	Gainford, L.	Kinnaird, L.
Cockfield, L.	Galloway, E.	Lauderdale, E.
Craigavon, V.	Gibson-Watt, L.	Long, V.
Cullen of Ashbourne, L.	Godber of Willington, L.	Lyell, L.
de Clifford, L.	Gowrie, E.	McFadzean, L.
Denham, L. [Teller.]	Greenway, L.	Mackay of Clashfern, L.
Macleod of Borve, B.	Penrhyn, L.	Strathclyde, L.
Mancroft, L.	Renton, L.	Strathcona and Mount Royal, L.
Mansfield, E.	Rochdale, V.	Strathspey, L.
Margadale, L.	Romney, E.	Swansea, L.
Morris, L.	St. Aldwyn, E.	Trefgarne, L.
Mottistone, L.	St. Just, L.	Trenchard, V.
Mowbray and Stourton, L.	Sandford, L.	Vaux of Harrowden, L.
Newall, L.	Sandys, L. [Teller.]	Vickers, V.
Northchurch, B.	Selborne, E.	Vivian, L.
Nugent of Guildford, L.	Sempill, Ly.	Westbury, L.
Orkney, E.	Stanley of Alderley, L.	Willoughby de Broke, L.

On Question, amendment agreed to.

6.43 p.m.

Clause 10 [Orders following report on competition reference]:

Lord TREFGARNE moved Amendment No. 10: Page 14, line 44, leave out ("substantially to the same effect as") and insert ("similar in form and effect to").

The noble Lord said: My Lords, may I on behalf of my noble friend move Amendment No. 10. We agreed in Committee to accept in principle the amendment to this clause tabled by my noble friend Lord Mottistone to ensure that an order made following a report on a competition reference should not extend to a course of conduct which was different in form to that specified in the report. My noble friend's amendment was slightly defective. The present amendment, however, achieves the desired result. I hope that your Lordships will accept it. I beg to move.

Lord MOTTISTONE

My Lords, I should like to thank my noble friend on the Front Bench for having put down this amendment in response to his undertaking.

Clause 11 [References to public bodies and certain other bodies corporate to the Commission]:

Baroness SEEAR moved Amendment No. 11:

Page 15, line 33, at end insert— ("( ) issues raised by bodies representing consumer interests concerning,").

The noble Baroness said: My Lords, if ever there was an amendment which should appeal to the hearts and minds of the Conservative Party it is surely this one. We are now dealing with Clause 11

which deals with the nationalised industries and consumers' influence in connection with the nationalised industries. I know that the noble Lord will say that of course issues will be raised by consumers organisations. But the nationalised industries are of very particular concern to consumers. With electricity and gas, we are all too frequently reminded how important they are to consumers. They affect the housewife, they affect the industrialist and every aspect of daily life. They are the monopolies to a very large extent.

We know that attempts have been made through consumer bodies to give consumers a voice in what happens in these vitally important industries. We also know— and this is agreed on all sides— that consumers' organisations and consumers' councils, statutory or otherwise, have found it extremely difficult to make any impact on the thinking or actions of the nationalised industries. All I am suggesting in this amendment— which is a weaker amendment, I frankly admit, than the one which was defeated at Committee stage— is that it is written into the Act that the Secretary of State will consider issues raised by the consumer organisations. It is to give a status, a recognition, to the important job that consumer organisations should be playing and need to be playing in these all-important industries. There are, I know, many people in the Conservative Party who really believe that the proper representation of consumers in nationalised industries is of the utmost importance. I very much hope that the Government will see fit to accept this amendment. I beg to move.

Lord WALLACE of COSLANY

My Lords, I should like to support the noble Baroness in the amendment that she has moved. So far in this Bill there has been very little chance for the consumer to get much of a look in. This is an ideal opportunity for the Government to express their support for the consumer organisations which do— as I think noble Lords will accept— play a very important and vital part in the life of our country and in preserving the rights of individuals The Government have not been too willing, but I hope they will relent on this one.

Lord TREFGARNE

My Lords, as I said during the Committee stage when we were considering, as the noble Baroness reminded us, a similar amendment to this, the Government would of course consider very carefully any representations from consumer bodies about a nationalised industry's, or other public body's costs and efficiency, standard of service or possible abuse of a monopoly situation. Such representations are most likely to raise questions which are probably already covered by the three sub-paragraphs in Clause 11(1) or by the earlier provisions of the Bill; and, in the circumstances, I hope the noble Baroness will not wish to press her amendment.

May I say a word about the nationalised industry consumer councils which I think were in the mind of the noble Baroness when she was speaking just now. As I think we have already announced, the

future of these councils is under review. The present legislation is not the appropriate vehicle for setting out their rights of representation to the Government. I hope that the noble Baroness will agree with that and not press her amendment.

Baroness SEEAR

My Lords, I very much regret that I cannot agree with that. I worded this amendment in the way that I did because the noble Lord said last time that the consumer councils as such were under consideration, and so this is a more open amendment. It does not refer specifically to the consumer councils. I cannot see why, because there is going to be a further review of the consumer position, this clause cannot be written into the Bill, therefore giving status to consumer organisations. I am afraid that I shall have to press the amendment.

6.49 p.m.

On Question, Whether the said amendment (No. 11) shall be agreed to?

Their Lordships divided:

Contents, 47; Not-Contents, 71.

CONTENTS
Airedale, L.	Gladwyn, L.	Oram, L.
Avebury, L.	Glenamara, L.	Peart, L.
Aylestone, L.	Gordon-Walker, L.	Seear, B.[Teller.]
Banks, L,	Goronwy-Roberts, L.	Simon, V.
Barrington, V.	Hale, L.	Stanley of Alderley, L.
Birk, B.	Hampton, L.	Stewart of Alvechurch, B.
Blease, L.	Henderson, L.	Stewart of Fulham, L.
Boston of Faversham, L.	Houghton of Sowerby, L.	Stone, L.
Brockway, L.	Jacques, L.	Strabolgi, L.
Caithness, E.	Kaldor, L.	Swaythling, L.
Cledwyn of Penrhos, L.	Kilmarnock, L.	Taylor of Mansfield, L.
Collison, L.	Kirkhill, L.	Wallace of Coslany, L.[Teller.]
Davies of Leek, L.	Llewelyn-Davies of Hastoe, B.	Wedderburn of Charlton, L.
Diamond, L.	McCarthy, L.	Whaddon, L.
Donaldson of Kingsbridge, L.	Monson, L.	Wigoder, L.
George-Brown, L.	Northfield, L.
NOT-CONTENTS
Alport, L.	Ebbisham, L.	Holderness, L.
Avon, E.	Eccles, V.	Hornsby-Smith, B.
Bellwin, L.	Elliot of Harwood, B.	Hylton-Foster, B.
Belstead, L.	Elton, L.	Kilmany, L.
Bethell, L.	Fraser of Kilmorack, L.	Kinnaird, L.
Boyd of Merton, V.	Gainford, L.	Lauderdale, E.
Campbell of Croy, L.	Galloway, E.	Long, V.
Carrington, L. {A Principal Secretary of State.)	Gibson-Watt, L.	Lyell, L.
	Godber of Willington, L.	McFadzean, L.
Cockfield, L.	Gowrie, E.	Mackay of Clashfern, L.
Craigavon, L.	Greenway, L.	Macleod of Borve, B.
Cullen of Ashbourne, L.	Grimston of Westbury, L.	Mancroft, L.
de Clifford, L.	Halisham of Saint Marylebone, L. (L. Chancellor.)	Mansfield, E.
Denham, L.[Teller.]		Margadale, L.
Drumalbyn, L.	Henley, L.	Morris, L.
Duncan-Sandys, L.	Hives, L.	Mottistone, L.
Mowbray and Stourton, L.	St. Aldwyn, E.	Strathspey, L.
Newall, L.	St. Just, L.	Swansea, L.
Northchurch, B.	Sandford, L.	Trefgarne, L.
Nugent of Guildford, L.	Sandys, L.[Teller.]	Trcnchard, V.
Orkney, E.	Selborne, E.	Vaux of Harrowden, L.
Penrhyn, L.	Sempill, Ly.	Vickers, B.
Renton, JL.	Strathclyde, L.	Vivian, L.
Rochdale, V.	Strathcona and Mount Royal, L.	Westbury, L.
Romney, E.

On Question, amendments agreed to.

6.57 p.m.

Lord TREFGARNE moved Amendment No. 12: Page 15, line 37, leave out ("body") and insert ("person").

The noble Lord said: My Lords, once more on behalf of my noble friend Lord Trenchard, I beg to move Amendment No. 12 and wish at the same time to speak to Amendments Nos. 13 to 16 inclusive, to Amendments Nos. 18 to 30 inclusive and to Amendments Nos. 39, 48 and 58.

During the Committee stage, my noble friend Lord Teviot moved an amendment seeking to remove most bus undertakings from the scope of Clause 11. The Government have considered carefully the points that he made during the debate, but we remain of the opinion that there may on occasion be a need for such bodies to be referred to the Monopolies and Mergers Commission for external scrutiny. The basis of our view is that there may be circumstances in which a local monopoly exists in the provision of bus services and in which questions of efficiency or standards of service need to be examined by somebody other than the Traffic Commissioners or the Passenger Transport Authority. However, we accept that the ambit of Clause 11(3)(b) is unnecessarily wide and the amendments which we have tabled seek to reduce the scope of that paragraph.

Amendment No. 18 permits the Secretary of State by order which, under Amendment No. 58, would be subject to Negative Resolution, to exclude from subsection (3)(b) persons of such description as may be specified in the order. It is intended that this power will be used to provide a minimum cut-off figure, based on turnover, below which a bus undertaking cannot be referred to the Commission. I cannot indicate what that figure will be, but interested parties will be consulted before the order is made.

Amendment No. 12 also provides that a body described in Clause 11(3)(b), or a subsidiary of such a body, may not be referred to the Commission under Clause 11 unless the reference relates to the carriage of passengers. This will include bus or light railway activities, but will exclude other matters referred to by my noble friend, such as car sales, travel agency and haulage.

The Government have been happy to introduce these amendments. However, I understand that there are a number of partnerships, as opposed to companies, engaged in the provision of bus services. The Government feel that an undertaking should not be able to escape scrutiny under Clause 11 merely because of its legal status. It therefore seeks in Amendment No. 15 to substitute the word "person" for "body corporate" in Clause 11(3)(b) thereby bringing in partnerships and sole traders. These, like companies, will of course benefit from the minimum turnover provision to be introduced by order and from the proposed restriction on the scope of references.

I should add that the bodies which the remaining paragraphs in subsection (3) seem to cover must inevitably be bodies corporate, and so the problem I have described in relation to paragraph (b) does not arise elsewhere. The remaining amendments in this group are purely consequential upon Amendment No. 15. Accordingly, I now beg to move Amendment No 12. I have also spoken to Amendments Nos. 13 to 16 inclusive, Amendments Nos. 18 to 30 inclusive and Amendments Nos. 39, 48 and 58.

Lord TREFGARNE moved Amendments Nos. 13 to 16:

Page 15, line 40, leave out ("body") and insert ("person").

Page 16, line 7, leave out ("bodies") and insert ("persons")

Page 16, line 16, leave out ("body corporate") and insert ("person")

Page 16, line 17, leave out ("which") and insert ("who").

7 p.m.

Lord STANLEY of ALDERLEY moved Amendment No. 17: Page 16, leave out lines 24 to 26.

The noble Lord said: My Lords, I withdrew this amendment in Committee because my noble friend Lord Trenchard promised to try to meet me halfway. But, without appearing to be too ungracious, I found on studying his remarks in column 692 of Hansard of 19th February, that my noble friend had offered me only a stone when I had asked for bread. In fairness to my noble friend, I have to admit that I confused the issue somewhat in my summing-up, due, I should like to say, to the reporting, but in all honesty I strongly suspect that I was somewhat muddling and colloquial, partly because I was completely amazed that my noble friend did not accept my argument or my amendment.

I shall not repeat my original reasons for wishing the agricultural marketing boards to be removed from Clause 11, as I know that my noble friend will have studied them. But I will mention that all the reasons given by my noble friend to me, and also to my noble friend Lord Caithness in Committee, carry absolutely no substance whatsoever. I am sorry to be blunt, but I am a farmer and I hope he understands how I feel.

In every case, the points that he raised are covered more fully by the Minister of Agriculture and the Agricultural Marketing Act 1958. I would repeat that Clause 11 refers only to the internal workings of the board, except for subsection (1)(c). I and my noble friend Lord Caithness still wait with the greatest interest for an example of when Clause 11(1)(c) would be used, when the situation would not already be covered by Clauses 2 and 10 of this Bill— and I repeat that we are not taking the boards out of that part. I feel very strongly indeed that to include the agricultural marketing boards in Clause 11 is complete nonsense. It will cause unnecessary bureaucratic duplication and unsettle the present arrangements, which are very satisfactory not just to the farmer but, in particular, to the consumer.

I shall finish with a little story, which is that as the Bill stands at the moment we could have the Minister of Agriculture considering reporting a particular board to the Monopolies and Mergers Commission. We could also have the Office of Fair Trading as well as the Department of Trade considering the matter. There could be all these bodies separately considering the matter before they came to consult. If that is not a waste of bureaucratic time, using up more and more civil servants, I do not know what is. I therefore ask the Government to accept this amendment, or, if they really feel they cannot, to give me some assurance that they will look at this matter again before Third Reading. My Lords, I beg to move.

Lord CLEDWYN of PENRHOS

My Lords, I fully support the case which has been put so well by the noble Lord, Lord Stanley of Alderley. The amendment was fully explained to the Committee and to the Government, and I regret that I was not able to be present at that time to speak to it. But I thought that the arguments were so conclusive that there would be no doubt of the Government's reaction. I am very deeply disappointed by the response of the Government, as I see it, in the amendments to Clause 15 on the Marshalled List tonight. The amendments which they have seen fit to put down do not allay my fears about the consequences of Clause 11, as it now stands, or the consequences of Clause 11, as amended by the Government's amendments to Clause 15.

Let me try to summarise my apprehension. As things are now, agricultural marketing boards are subject to the Agricultural Marketing Act 1958. That Act has worked well. It was introduced by the Conservative Government in 1958. I remember it going through another place. I was able to support it, because I thought that the proposals in respect of the agricultural marketing boards were reasonable and should be supported. It set up machinery, as the House knows, which involved committees of investigation and consumer committees, as well as ministerial directions and other arrangements, and it has proved extremely effective in protecting the public interest since then.

I have heard no evidence to the contrary, and the one thing which Government spokesmen must satisfy the House about tonight is that there is something wrong with the 1958 Act; that, somehow or other, the machinery which they, the Conservative Party, set up under the 1958 Act has not worked adequately, because there could be no other justification for the provisions of this Bill. If the procedure laid down in the 1958 Act is effective, why is it necessary to include the agricultural marketing boards in Clause 11? I think that the Minister who replies has an obligation to explain to the House this evening, in the clearest terms, why the Government are not satisfied with the 1958 Act machinery.

If the boards arc included in Clause 11, they will still be subject to the 1958 Act and to this Bill's provisions for the control of anti-competitive practices, together with the possibility of a reference to the Monopolies and Mergers Commission. In other words, to include the boards in this Bill will be to add again to the procedures which already exist under the 1958 Act, thereby making the lives of those who work in the boards excessively difficult. The Government's proposed amendments to Clause 15 do not preclude this difficulty and they do not therefore meet our main argument. I do not think that the consultation with the relevant Minister which is proposed is an adequate solution to the problem which the Bill as it stands will create.

What the Government are saying, as I understand it, is, "We want the agricultural marketing boards to be subject to the 1958 Act and to this Bill". Why is that? Why do the Government want the agricultural marketing boards to be subject to this Bill in addition to the 1958 Act, or do they propose to repeal the relevant part of the 1958 Act to take the agricultural marketing boards out of it? I think that the House is really entitled to know. We have not had a satisfactory explanation of the Government's policies and the Minister must work very hard to satisfy me, as otherwise I shall have to consider my position at the end of the debate.

The Government have said that they want to reduce the volume of legislation. They said that in their election manifesto and I agree with it. Since the war, there has been too much legislation in this countr by far, by successive Governments of all parties. The Government are also on the record as saying that they want to reduce machinery of this kind. That is another argument which they have used and I agree with that. I do not want to increase the machinery which exists in Clause 11. They have also said that they want to reduce paper work. On that, I agree again. There is far too much form-filling in this country and, as I well know, farmers are subjected to a great deal of it. The Government have said that they want to reduce officialdom. I agree with that as well.

But when I read what is proposed for the agricultural marketing boards in this Bill, I begin to wonder whether the Government were as sincere as they might have been when they made these promises. I shall sit down in a moment, because I do not want to detain the House for too long, but the result of this clause, if it goes through as it now stands, will be to create greater confusion than before, to create more machinery than before, to create more "officialese" and more paperwork than before. Is that what the Government want? That will be the effect of this clause as it stands, if the Government do not propose to change it. They are doing it in a field of vital importance; namely, the agricultural marketing boards which are doing a splendid job in the interests of agriculture and in the interests of the country as a whole.

I appeal to the Government at this stage to think again, otherwise they will undermine the confidence of very important organisations in this country. If the noble Lords on the Front Bench opposite give this matter very careful thought, I think they are bound to conclude that to close the door now to these arguments will be to damage bodies which are vital to the interests of food production in this country at the present time.

Baroness ELLIOT of HARWOOD

My Lords, before the noble Lord speaks, I wonder whether I may say a word, because I feel very strongly about this matter. The marketing boards, started and organised by the Conservative Party and supported by all the other parties, are working extremely well. They are subject to all the safeguards which noble Lords want in connection with the Agricultural Marketing Act 1958. Suddenly, therefore, to include these boards in the Bill is, I think, the greatest possible mistake. You will get nothing out of it at all; you will only complicate everything. Only a very short time ago the EEC said that they would not support the Milk Marketing Board from the point of view of the British within the EEC unless 80 per cent. of dairy farmers voted in favour of it, and when they took a ballot 99. 2 per cent. voted in favour.

Surely it is very, very foolish to do away with what is working extremely well. When something is working well, why alter it? Certainly alter a thing when it is not working well, but this agricultural organisation is working very well; so why not leave it alone? What is the point of altering it when you have got a first-class job being done and when all the safeguards that you want are already there? I beg the Government to omit paragraph (d) because it is a most wrong thing to do— and, I think, quite irresponsible. It is only going to make for very great trouble. It will also do a lot of harm to the goodwill that the farming community has towards the Government. I beg the Minister to agree to our amendment.

Lord DAVIES of LEEK

My Lords, since the 1945 period I have watched in the hill farming areas, and everywhere else, the strength of the marketing boards. As was rightly said by the noble Baroness, Lady Elliot of Harwood, originally there was the impetus of the Conservative Party for these marketing boards. That is why we appeal that lines 24 to 26 should be omitted. Common sense shows that all the machinery for consumer safeguards and for all the other safeguards is there. I do not want to make a party-partisan speech, but I really do feel that Friedmanism has gone mad here. Friedmanism is setting fire to a first-class thing that has helped the prosperity of British agriculture. On both sides of this noble House, 99 per cent. of us are interested in the health of British agriculture. Therefore, without repetition I beg the Government to look carefully at the consensus of opinion in the farming fraternity, in the business fraternity and on both sides of this noble House.

Lord GODBER of WILLINGTON

My Lords, I should like, just for one moment, to reinforce what has been said on both sides of the House on this matter. I feel strongly about the issue. The agricultural marketing boards have done tremendous good over the years. The point at issue seems to me to be that they have been long established. There have been no cases recently of abuse of which I am aware, and if there are cases of abuse the Agricultural Marketing Act provides adequate provision for dealing with them. There is no proposal to introduce new agricultural marketing boards at this time. Indeed, they are already under attack in Brussels. To attack them in this country as well seems to me to be quite wrong, I urge the Government most seriously not to press ahead with this, for it seems to me to be totally unnecessary. I do not understand the reasons for including it. I shall not repeat the very clear arguments which have been made on both sides of the House. I totally agree with all that has been said.

The Earl of SELBORNE

My Lords, I should like the opportunity to support the noble Lord, Lord Stanley of Alderley, and the other Members of your Lordships' House who have spoken to this amendment. I should declare that I am chairman of the Hops Marketing Board. Therefore, I take some considerable degree of interest in the matter and look with alarm at the Bill as at present drafted.

The point which has been made so often on both sides of the Chamber must be valid. The present Minister of Agriculture and, indeed, previous Ministers of Agriculture, have ensured that over the years marketing boards should evolve to fulfil a very great marketing need. They are doing just that. But one thing which cannot be done is to encumber them with unnecessary bureaucratic ties. In a monopoly position it is right that marketing boards should have checks and balances, but they already exist, as has been said already, under the Agricultural Marketing Act 1958. This Bill misguidedly tries to introduce yet further checks, with the real threat that the Secretary of State for Trade, the Minister of Agriculture, and the Office of Fair Trading will all be putting their oar in and making life for the marketing boards very much more complicated and certainly less effective.

It is no exaggeration to say that things will run smoothly if they are kept simple. The Agricultural Marketing Act 1958— so far as I know, and I speak as a member of a marketing board— has been working efficiently and effectively. There are occasionally committees of inquiry. That is the way in which any complaints are looked at; and if necessary action can be taken. The Minister did not show during the Committee stage that there was any reason to suppose that these procedures are working ineffectively. He must, I suggest, show today why the present procedures are ineffective. If so, I should be very interested to hear of them.

I suggest, however, that even if there are procedures which are ineffective the way to deal with them is to amend the Agricultural Marketing Act. That Act is tailor-made for these marketing boards which, as has already been said, are very dear to the hearts of farmers. They are under threat in Brussels and this measure in no way, I suspect, helps us to maintain the very great strength to be derived from these boards. I hope very much, therefore, that the Minister will take very seriously the points which have been made on all sides, and the deep concern which is felt in the Chamber about this issue.

Lord MOTTISTONE

My Lords, I should love to hear from one of my farming friends just why they deserve to he singled out to be excluded from this Act which is to apply to practically every other trading business in the country. What is so special about the farmers— —

The Earl of CAITHNESS

My Lords, I wonder whether the noble Lord would give way?

Lord MOTTISTONE

My Lords, I wonder if I could finish my sentence. What is so special about the farmers that makes them justifiably excluded from this Act, and nobody else?

The Earl of CAITHNESS

My Lords, the point is that the agricultural marketing boards do not want exemption from the Act. That is a total misapprehension. They want exemption from this clause, and this clause deals with the internal workings of the boards. That is what is covered by the 1958 Act. We are not taking the boards out of the Bill. If this amendment were to be agreed to, it would in no way affect the application of the other provisions of the Bill to the agricultural marketing boards. In particular, the boards would remain subject to the provisions dealing with the control of anti-competitive practices. We have not had one good reason why our case is not a valid one. We have not had one good reason for the inclusion of the boards in this clause of the Bill. I am sure my noble friend will appreciate that point.

Lord MOTTISTONE

My Lords, I should like to ask my noble friend whether that is a speech or an interruption in my speech?

The Earl of CAITHNESS

Which does the House prefer?

Lord MOTTISTONE

My Lords, with the permission of the House, may I say that I was rather swept off my feet by my noble friend. It seems to me that if we have a body which is in a semi-monopolist position it is only reasonable that as well as being subject to the rest of the Act it should be subject to Clause 11, and I cannot see why the farmers need special treatment.

Lord BLEASE

My Lords, I support this amendment. I fully concur with the views expressed by noble Lords opposite and by my noble friends on this side of the House concerning the operation of this clause. It is my view that there is nothing in the provisions proposed in this clause that makes it possible for any question affecting a board to be dealt with more effectively than is possible through the existing provisions of the Monopolies and Mergers Commission and the Fair Trading Act 1973, and the way powers of investigation and control are available under the Agricultural Marketing Act 1958 and— the main reason why I rise to my feet— the Agricultural Marketing (Northern Ireland) Act 1964, because this provision will apply to Northern Ireland also.

In my opinion to include the boards in Clause II will achieve nothing of benefit to the consumer, to the producers or to the interests of the general public. Indeed, its inclusion will tend to cause confusion and impede arrangements for existing effective investigation and control. In my view clearly it would be regrettable if legislation, such as this Bill will create through this clause, should result in a waste of resources and the time of all concerned. Therefore, in view of the remarks which have been made on both sides of the House, I hope the Minister will agree to this amendment.

Lord TREFGARNE

My Lords, several noble Lords and noble Baronesses have said that they feel strongly on this amendment. I do, too. The agricultural marketing boards have been included in Clause 11(3) because of their monopoly position, under statute, in which respect they are little different from many of the other bodies covered by subsection (3). Nevertheless, in view of the special position of the Ministers for agriculture in relation to agricultural marketing boards under the Agricultural Marketing Act 1958, the Government have tabled amendments to Clause 15 which we shall be able to discuss later. These will have the effect of requiring the Secretary of State formally to consult the relevant agricultural Minister before a board is referred to the Commission under Clause 11. The amendments also require similar consultation about the use of the Secretary of State's power of veto under the earlier clauses of the Bill.

The noble Lord, Lord Cledwyn of Penrhos, and I think other noble Lords as well, asked me about the problems of the 1958 Act. The 1958 Act allows agricultural Ministers (if that is the right expression) to deal with a number of questions affecting these boards. Committees of investigation, when asked to do so by the Minister, can consider and report upon reports made by consumers' committees and upon complaints made to the Minister which he considers are not for the consumers' committees. Consumers' committees can deal with the effect of any scheme on consumers of the product concerned and with complaints by consumers. But there is no specific provision for the general efficiency audit of a board and it is this kind of inquiry which Clause 11 of the Bill is intended to cover. The Bill also provides a wider scope for the investigation of anti-competitive practices.

I do not understand why it is that noble Lords seek to exempt the agricultural boards from these efficiency audits. We have heard a number of speeches which, if one had been an outsider one might have ventured to think that we were threatening the very future of these boards. That is far from the case. Our feelings are quite clearly that we ought to expose these boards, where necessary and where there is agreement by the Ministers concerned (as provided for by our subsequent amendments) to the scrutiny of the Monopolies Commission in appropriate cases. We are quite adamant that we propose to resist these amendments, and I hope they will not be pressed.

Lord CLEDWYN of PENRHOS

My Lords, will the noble Lord deal rather more specifically with some of the points that have been raised by noble Lords? Given that the agricultural marketing boards have been in existence for many years— indeed, the Milk Marketing Board has been in existence for over half a century— is there any evidence over the whole of that period that these boards should be referred to the Monopolies Commission or to an efficiency audit? Has any new evidence come to hand in recent months or years which prompts the Government to take this quite extraordinary action? What is worrying noble Lords is that the agricultural marketing boards will now be the only organisations which will be subject to two Acts of Parliament. Other organisations will be subject to this Act: the agricultural marketing boards will be subject to this Act and also to the Agricultural Marketing Act 1958. An additional burden is being placed on them which does not apply to the other boards about which the noble Lord, Lord Mottistone, is so concerned. Can the noble Lord deal with that?

Lord TREFGARNE

My Lords, as the noble Lord has said some of these boards have been in being for a good number of years and, by and large, they have not been subjected to the sort of scrutiny which we are now providing for, where the Ministers concerned feel that the investigation is appropriate. I would turn the question about: The noble Lord asked me whether we have any positive evidence that these boards are in need of audit. No, I have not. Neither has the noble Lord any evidence that they are perfect.

Lord CLEDWYN of PENRHOS

My Lords, with respect, the noble Lord is not being fair to me or to the House. He has not answered my question. Is he satisfied with his colleagues in the Government, that the Agricultural Marketing Act 1958 is working satisfactorily? Is there any evidence in recent years which has prompted the Government to include the agricultural marketing boards in Clause 11 of this Bill? The information I have is that the marketing boards are working efficiently and that there has been no complaint for several years. It is ten years since I was Minister of Agriculture, and I can say to the noble Lord and to the House that there was complete satisfaction at that time, not only in the Ministry of Agriculture but in other Departments of State as well. The marketing boards were working efficiently and well. By taking this step the Government are saying to us and to the country that for some reason or other these boards are not working as they should. We need evidence before we can agree to this clause and the noble Lord has not given the House the necessary evidence to enable us to support it.

7.29 p.m.

Viscount TRENCHARD

My Lords, in deference to the noble Lord, Lord Cledwyn of Penrhos, and to my noble friend Lord Godber of Willington, both of whom have been Ministers of Agriculture, I want to say two things: one, that my right honourable friends the Secretaries of State for Agriculture and for Trade have discussed this at great length and are happy with what we are putting before the House. Secondly, we are not trying to undermine the 1958 Act in any shape or form, nor do I believe we will. It is not a question of whether these boards are going to be referred; it is a question of whether they could conceivably be, in relation to an anticompetitive practice.

There are no examples that I can quote of these bodies behaving in a way that is contradictory to the 1958 Act. We are not actually talking about the 1958 Act; we are talking about the two differences which my right honourable friend mentioned. It is also true to say that in relation to anticompetitive practices we have no evidence against almost any other body in the country. If the noble Lord is following me, I was saying that we have no evidence against almost any other board in the country that they are behaving in an anticompetitive way. Therefore, simply because one has no evidence that they are behaving in an anti-competitive way is no reason not to apply the Bill to a board with a monopoly situation, which they undoubtedly have, bearing in mind the ability in that powerful position to treat individual customers quite differently, which consumers committees might not regard as an anti-competitive practice. Neither is there a power in the 1958 Act to look at the efficiency in general. For these two reasons there could be an exceptional case, and what we are saying is why should they be excluded from reference in an exceptional case when both Ministers have considered that the reference should be made.

The EARL of CAITHNESS

My Lords, my noble friend mentioned anti-competitive practices. Would he not agree that the agricultural marketing boards are already caught, under this particular heading of anti-competitive practices, under Clauses 2 to 10 of this Bill?

Viscount TRENCHARD

My Lords, I am informed not in relation to practices that the board might perform in relation to one customer or another and the effect that that might have between first point of sale, first-hand trading, wholesaler retailer beyond. I am informed that the aspects which my noble friend covered very clearly the 1958 Act does not fully cover. We are talking about the very unlikely occurrence that there is a reference, agreed by both Secretaries of State, in relation to aspects of this Bill which are not covered in the 1958 Act. Agriculture is being treated completely exceptionally in bringing in the need to consult in all the earlier clauses of the Bill.

Lord CLEDWYN of PENRHOS

My Lords, I crave the indulgence of the House for intervening once again. I am grateful to the Minister of State for his intervention. It is always agreeable to listen to the Minister of State, but he has not helped me a great deal. He has not taken account of the fact that these agricultural boards have statutory obligations and that they are very much under ministerial control, as it is. He knows perfectly well that the Milk Marketing Board has been under ministerial control from the start, and that milk is one of the most important commodities so far as the consumer is concerned. The price of milk is strictly controlled. It is about the only commodity that is controlled. I would hope, therefore, that the Front Bench will think again before the House comes to a final decision.

Lord STANLEY of ALDERLEY

My Lords it seems as though I have to sum this up and I am not sure I am going to do it very well. Perhaps I may start by saying that in agricultural terms my Front Bench are quite wrong and they have not answered any of my questions or any of my noble friends' questions. I am sory to put it so bluntly, but the Front Bench opposite suffered from me last year so you have to suffer from me now. You really have not answered the questions. It is a disgrace, if I may say so. We are a revising House. There is nothing political in this. My noble friends and my old friend Lord Cledwyn have brought all these points up and you have not answered them. First, let me say that we are very different. Agricultural marketing boards are controlled under the Agricultural Marketing Act 1958, in every aspect, I can tell my noble friend. With regard to efficiency audit, the Minister of Agriculture can call for an efficiency audit if he wishes. What is the difference between him and the Secretary of State for Trade, might I ask? Why duplicate the damned thing? I am sorry; why duplicate it? Then it is said expose these boards. Well, they can be exposed and scrutinised again under the Agricultural Marketing Act. They can be exposed and scrutinised by the consumer committees, by the investigation of inquiries. Anyway, what happened to the Egg Marketing Board. What happened to the Tomato and Cucumber Board? They were exposed, once by farmers for inefficiency and once by consumers. I do not suppose the Secretary of State for Trade is going to expose people any better than I can expose them, I hope. You have not answered any of my questions.

Lord DENHAM

My Lords, if I may just remind my noble friend, he is addressing the House and not Her Majesty's Government.

Lord STANLEY of ALDERLEY

I take the point, my Lords, but the House does not need addressing because they happen to be with me. I will try my best. The questions have not been answered by the Government: it is not my noble friends; they have answered the questions. In regard to Clause 11(1)(c), which is the one dealing with monopolies, they have not given me an example of when this could be used. The only possible example was given by my noble friend Lord Trenchard when he said it would be in exceptional circumstances. I have always understood that to legislate for exceptional circumstances made really bad law. I am not prepared to accept that.

I should like to thank those who have supported me. The noble Lord, Lord Cledwyn, said that greater confusion could arise; that was the understatement of the evening. We had my noble friend Lady Elliot saying that the goodwill would be destroyed between the boards and the Government, the Minister of Agriculture. It will. It has worked very well; why disturb it? Then there was my noble friend Lord Godber— I am correcting one Minister of Agriculture after another— who must know a little bit more than I do, I should have thought. He asked whether there was any question of abuse. There has never been any question of abuse over these boards. Yet you want to change it.

My noble friend Lord Selborne, who runs one of these boards, reminds your Lordships that it will make it more difficult for him. We are very grateful for those who run boards, even though they may be called Quangos. I do not want to make his life any more difficult. Finally, my noble friend Lord Mottistone asks, what is so special about the agricultural marketing boards? A lot is; they are very efficient for one thing. They are controlled by the 1958 Act; that is what is so special, that they are totally different from the others. I will not go on repeating myself. If the Government cannot give me anything more, I shall have to test the opinion of the House.

7.38 p.m.

On Question, Whether the said Amendment (No. 17) shall be agreed to?

Their Lordships divided: Contents, 45; Not-Contents, 61.

CONTENTS
Airedale, L.	Elliot of Harwood, B.	Orkney, E.
Ardwick, L.	George-Brown, L.	Peart, L.
Barrington, V.	Gladwyn, L.	Romney, E.
Birk, B.	Godber of Wellington, L.	Seear, B.
Blease, L.	Greenway, L.	Selborne, E.
Blyton, L.	Hale, L.	Sempill, Ly.
Boston of Faversham, L.	Henley, L.	Simon, V.
Brockway, L.	Houghton of Sowerby, L.	Stanley of Alderley, L. [Teller.]
Brooks of Tremorfa, L.	Hylton-Foster, B.	Stewart of Alvechurch, B.
Caithness, E.	Jeger, B.	Stewart of Fulham, L.
Cledwyn of Penrhos, L.	Kaldor, L.	Stone, L.
Collison, L.	Kirkhill, L.	Strabolgi, L.
Davies of Leek, L.	Llewelyn-Davies of Hastoe, B.	Taylor of Mansfield, L.
Davies of Penrhys, L.	Northchurch, B.	Wallace of Coslany, L.[Teller.]
Donaldson of Kingsbridge, L.	Northfield, L.	Whaddon, L.

NOT-CONTENTS
Alport, L.	Gainford, L.	Mottistone, L.
Avon, E.	Galloway, E.	Mowbray and Stourton, L.
Bellwin, L.	Gibson-Watt, L.	Newall, L.
Belstead, L.	Gowrie, E.	Nugent of Guildford, L.
Boyd of Merton, V.	Grimston of Westbury, L.	Penrhyn, L.
Brougham and Vaux, L.	Hailsham of Saint Marylebone, L. (L. Chancellor.)	Renton, L.
Campbell of Croy, L.		Rochdale, V.
Canington, L. (A Principal Secretary of State.)	Harmar-Nicholls, L.	St. Aldwyns, E.
	Hives, L.	St. Just, L.
Cockfleld, L.	Holderness, L.	Sandford, L.
Craigavon, V.	Hornsby-Smith, B.	Sandys, L.[Teller.]
Cullen of Ashbourne, L.	Kilmany, L.	Selkirk, E.
de Clifford, L.	Linnaird, L.	Strathcona and Mount Royal, L.
Denham, L.[Teller.]	Lauderdale, E.	Strathspey, L.
Drumalbyn, L.	Long, V.	Swansea, L.
Duncan-Sandys, L.	Lyell, L.	Terfgarne, L.
Ebbisham, L.	Mackay of Clashfern, L.	Trenchard, V.
Eccles, V.	Mansfield, E.	Vaux of Harrowden, L.
Elton, L.	Margadale, L.	Vickers, B.
Ferrers, E.	Monson, L.	Vivian, L.
Fraser of Kilmorack, L.	Morris, L.	Westbury, L.

Resolved in the negative, and amendment disagreed to accordingly.

7.45 p.m.

Lord TREFGARNEmoved Amendments Nos. 18 and 30:

Page 16, line 33, at end insert— ("(3A) The Secretary of State may by order exclude from subsection (3)(b) above persons of such descriptions as may be specified in the order. (3B) No question concerning a person falling within subsection (3)(b) above or a subsidiary of a body falling within that subsection may be referred to the Commission under this section unless it relates to the carriage of passengers by the person or, as the case may be, the subsidiary.").

Page 17, line 7, leave out ("body") and insert ("person")

Page 17, line 31, leave out ("body") and insert ("person")

Page 17, line 34, leave out ("body") and insert ("person").

Clause 12, page 17, line 41, leave out ("body") and insert ("person").

Clause 12, page 18, line 2, leave out ("body" and insert ("person")

Clause 12, page 18, line 4, leave out ("body") and insert ("person")

Clause 12, page 18, line 5, leave out ("body") and insert ("person")

Clause 12, page 18, line 21, leave out ("body") and insert ("person")

Clause 12, page 18, line 23, leave out ("such a body") and insert ("a body falling within that paragraph")

Clause 12, page 18, line 24, leave out ("body") and insert ("person")

Clause 12, page 18, line 32, leave out ("body") and insert ("person")

Clause 12, page 18, line 37, leave out third ("the") and insert ("a").

The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move Amendments Nos. 18 to 30 en bloc.

On Question, amendments agreed to.

Clause 13 [Investigations of prices directed by Secretary of State]:

Baroness SEEAR moved Amendment No. 31:

Page 19, line 15, leave out from beginning to ("under") in line 19, and insert— ("(1) The Director may carry out an investigation into any price which appears to him to be of public concern with a view to providing the Secretary of State with information, recommendations and observations relating to that price; but an investigation").

The noble Baroness said: My Lords, I beg to move Amendment No. 31. For the convenience of the House I shall speak also to Amendments Nos. 35, 36, 37, 38 and 47, which is consequential. These are, of course, amendments of considerable substance. The point behind them, as was explained in the Committee stage, is that at present there is very great anxiety about increases in prices. It is extremely desirable, in the absence of a Price Commission, that the Director General should be able, on his own initiative and not having to wait for references from the Secretary of State, to conduct an investigation into a price increase. It is, of course, a substantial change in the purpose of the Bill, but we believe that, while a Price Commission is not in our view necessary, it remains extremely important that there should be the possibility of intervening quickly as regards matters of prices which are causing very considerable public concern.

At a time when it is being urged continuously that discretion should be used in attempting to increase wages, but when there is no policy on wages as such, we take the view that to ask for restraint and good sense in the area of wages, when there is no opportunity for intervention as regards prices, is extremely unwise. Therefore we propose the power of intervention which will not depend on the decision of the Secretary of State, which is limited, as the Bill stands, to matters of major concern. That should not be the policy of this legislation, but instead the Director General should have the power to intervene on his own initiative. It is for that purpose that I beg to move the amendment.

Viscount TRENCHARD

My Lords, we discussed very fully the question of price control both on Second Reading and in Committee. Thus, I shall be as brief as possible in reiterating only the main points that we made previously. It is intended that investigations under Clause 13 should be purely fact-finding. These amendments, taken in conjunction with the proposed new clauses, are totally at variance with that intention. The amendments are similar in scope to those considered at the Committee stage in another place and in Committee in this House and the reasons given for resisting them are still valid.

The intention is that the powers in Clause 13 should be held in reserve for use only in cases where public concern about a particular price issue makes it desirable for an independent inquiry to establish the reasons for the price level concerned. It is, therefore, right that the Secretary of State alone should have the right to initiate these investigations and that he should have the duty of defending his decisions before Parliament. If, as a result of a price investigation, there is evidence that a price is unjustified, the appropriate follow-up action could be through use of the competition legislation — for example, the earlier provisions of this Bill dealing with anti-competitive practices or action.

I turn to Amendments Nos. 37 and 38. The new clauses introduce the concept of price control, which is quite contrary to the purpose of Clause 13 or to that of the Bill as a whole. The Government have made it clear that their attitude towards price control is quite different from that of the previous Administration. It follows that these new clauses are not acceptable.

We have said that the effect of the Price Commission on prices in the past has been minimal, and we have drawn evidence to support that. We believe that if competition is strengthened— and this Bill will strengthen it— the room for abuse is also minimal. Therefore, we believe that it is only in very exceptional cases that the Secretary of State should have to use his powers. I beg your Lordships not to divide again upon this amendment as we have argued the case so often.

Lord WALLACE of COSLANY

My Lords, I should like to make a brief remark on this. At the Third Reading in another place the Minister said that the Secretary of State would have no responsibility for prices, that that would be the responsibility of the respective Ministers, whoever they might be. Do I understand the position to be that, in fact, the Government, and the Secretary of State in particular, take no responsibility for prices?

Viscount TRENCHARD

My Lords, I think that the noble Lord refers to quite another question, the question of which Minister in the other place would answer questions about price levels of particular commodities, services or what-have-you, where it has been decided that the Minister whose department is responsible for that area should answer those questions.

Baroness SEEAR

My Lords, in view of the late hour and of the results of recent Divisions, I very reluctantly ask the leave of the House to withdraw these amendments.

Amendment, by leave, withdrawn.

7.53 p.m.

Lord WALLACE of COSLANY moved Amendment No. 32: Page 19, line 26, leave out ("major").

The noble Lord said: My Lords, I beg to move amendment No. 32. At the same time I should also like to speak to Amendment No. 33. The purpose of this amendment is to remove the extremely tight wording of subsection (2) of Clause 13. The discussion on my more drastic amendment during the Committee stage provoked so many heated exchanges that the Committee did not receive an adequate reply from the Government Bench. That was mainly my fault and, if humanly possible, I do not intend to provoke the Minister unduly now.

As subsection (2) is drafted, it would seem that only in the most extreme cases would the Secretary of State give a direction. It provides a perfect loophole to evade responsibility. Public concern is quite sufficient reason for the Secretary of State to consider and, if satisfied, give a direction, and avoids the problem of deciding what constitutes major public concern". On paragraph (a), it is accepted, particularly in the present financial situation, that "general economic importance" is relevant, although the inclusion of "general" is a little vague. With reference to paragraph (b), the inclusion of the word "significantly" is, if I may say so, another example of over-emphasis. Surely the fact that the consumers are affected, directly or indirectly, by the price is sufficient ground for the Secretary of State to consider whether the effect on consumers is significant enough to warrant action.

By accepting Amendment No. 32, the Government would give a clearer indication that they have the interests of the consumer in mind. As the clause stands, it gives the impression that only in the most extreme cases would the Secretary of State give a direction to the Director General. As it stands, there would appear to be only a very remote possibility of action being taken.

As the noble Baroness, Lady Seear, mentioned, costs and prices are a very emotive subject, particularly at the moment, and there exists in the average household extreme sensitivity— whether it be on the part of the housewife (the family Chancellor of the Exchequer), or of any member of the family complaining to her. I do not want to be too pressing on the Government, but I believe that there are reasonable, adequate and sensible grounds for this amendment to be accepted, because it does not alter the clause in any major fashion whatever, and gives a greater impression of the flexible approach that the Government might take. I beg to move.

Viscount TRENCHARD

My Lords, again, we have been over this ground before. The power in this clause is not a replacement for the price control powers of the Price Commission legislation. It is intended to be a fact-finding exercise to be used only in exceptional cases. Both these words, "major" and "significant", would allow a myriad of small complaints to be made and they would not advance the situation of the level of prices. We really have to divide the question of the level of prices and the events that are responsible for it and the effect of price control upon it. We have been through that on many occasions. I recognise that prices are an emotive subject and I realise that during the time— which lasted for many long years— when this Government and the previous Government appealed for adherence to an incomes policy as such, it was argued that as a quid pro quo prices must be controlled.

I mentioned on Second Reading that it was my belief that most of the action taken by the Price Commission was purely cosmetic in this effect; that it did not get an incomes policy to stick; that, in so far as it did knock the odd tiny percentage off the RPI, it did damage to investment and almost certainly, as a result, damage to prices the year after next, even if not in the year in question. Therefore, this Government's approach is quite different, and we very much hope that what we believe is the illusion that prices must be controlled in order to keep them lower than they would otherwise be will soon be realised not to be the fact of the matter.

As we have said on many occasions, the proof of the pudding seems to be in the levels of margins in this and other countries achieved by industry, which is working under strong competitive terms, which will be made stronger. We believe that this clause should only be an absolute reserve, and we do not want it in any way to become the usual method under which the Secretary of State asks for price investigations. We believe that it is unnecessary; we believe that our approach is more in the interests of consumers and, indeed, wage-earners. I hope that the noble Lord, Lord Wallace of Coslany, will not press his amendment.

Lord PONSONBY of SHULBREDE

My Lords, I am slightly surprised at the remarks of the noble Viscount. He is quite right that we have been over this ground before. The fact is that the clause as now worded— as he calls it, an absolute reserve— is such that it will never be used. We would in fact like this clause to be worded in such a way that it is capable of being used. While accepting the general principle of the Government philosophy that competition is better than price control, this amendment proposed by us would bring the clause within the field of a clause which could actually be used for the purposes for which it is proposed, rather than of a clause which would never be used. It seems to me that the clause as at present worded is, in a sense, a sop to the public; it is a sop to your Lordships, but does not in fact come into the area of a clause which would be used. Our amendment is to bring this clause within the area of a clause which could be used by a Secretary of State.

Viscount TRENCHARD

My Lords, with the leave of the House, I will only say that I believe that this clause can be used in a question of major public concern into prices of great significance, and that is what it is intended for.

Lord WALLACE of COSLANY

My Lords, I am not going to delay the House on this. I think that the noble Viscount has made a mountain out of a molehill by implying that this is a back-door method of introducing price control. It is nothing of the sort. What I and many people object to is the way in which the clause is worded so that, as my noble friend Lord Ponsonby has just said, nothing would be done. It is said that it would be a question of receiving masses of minor complaints. I do not think that that would be the case. Anyway, why not let people make complaints? Are they going to regard the British public as a lot of dull, sitting ducks, to do as they are told?

Viscount TRENCHARD

My Lords, would the noble Lord allow me to intervene? Nobody is going either to legislate or achieve a situation where the British public will not complain. I am quite sure that they will complain. What we are talking about is the Secretary of State's initiative to use the powers under Clause 13, and he does not envisage using those powers except in the circumstances prescribed in the Bill.

Lord WALLACE of COSLANY

My Lords, when the noble Viscount refers to the Secretary of State's initiatives, the blunt fact is that there is practically no initiative afforded to him at all, except in the most remote and extreme cases. This is an important issue. At Committee stage I moved a much stronger amendment, which I have deliberately watered down this time in order to get some result out of the Government, but the fact is that on this Bill the Government do not intend to accept any amendments whatever, except perhaps those that come from certain sections behind them. That is true.

A noble Lord: Order!

Lord WALLACE of COSLANY

My Lords, it is not a question of "order". I am stating a blunt fact. I do not want to provoke the same atmosphere that I did before. I restrained myself, praying that the charitable minds of the noble Viscount and his cohorts would at last break into the open and make a concession. I am not satisfied. I am sorry that there are not many Members of the House present, but on principle I insist that we have a Division.

[Amendment No. 33 not moved.]

8.12 p.m.

Lord AIREDALE moved amendment No. 34:

Page 20, leave out lines 1 to 6 and insert— ("(5) A direction under subsection (1) or (3) above shall specify a period within which the Director is to report on his investigation to the Secretary of State and the Director shall report accordingly—")

The noble Lord said: My Lords, subsection (5) contains a curiosity in that in line 2 the Director is to report, while in line 5 he is to make a report. I should think this is a distinction without a difference and I wonder how it crept in. I dare say it was because the subsection is so verbose and seems to suggest it is necessary to say things twice. I have ventured to shorten it considerably without affecting in any way the sense.

8.5 p.m.

On Question, Whether the said Amendment (No. 32) shall be agreed to?

Their Lordships divided: Contents, 23; Not-Contents, 59.

CONTENTS
Airedale, L.	Kaldor, L.	Seear, B.
Blease, L. [Teller]	Kirkhill, L.	Stewart of Alvechurch, B.
Boston of Faversham, L.	Llewelyn-Davies of Hastoe, B.	Stewart of Fulham, L.
Brockway, L.	Northfield, L.	Stone, L.
Brooks of Tremorfa, L.	Peart, L.	Strabolgi, L.
Cledwyn of Penrhos, L.	Pitt of Hampstead, L.	Wallace of Coslany, L.
Collison, L.	Ponsonby of Shulbrede, L. [Teller.]	Whaddon, L.
Davies of Leek, L.
Hale, L.

NOT-CONTENTS
Alport, L.	Grimston of Westbury, L.	Orkney, E.
Avon, E.	Hailsham of Saint Marylebone, L. (L. Chancellor.)	Penrhyn, L.
Bellwin, L.		Rochdale, V.
Belstead, L.	Harmar-Nicholls, L.	Romney, E.
Brougham and Vaux, L.	Henley, L.	St. Aldwyn, E.
Caithness, E.	Hives, L.	St. Just, L.
Craigavon, V.	Holderness, L.	Sandys, L.[Teller.]
Cullen of Ashbourne, L.	Hornsby-Smith, B.	Selborne, E.
de Clifford, L.	Lauderdale, E.	Selkirk, E.
Denham, L.[Teller.]	Long, V.	Sempill, Ly.
Drumalbyn, L.	Lyell, L.	Stanley of Alderley, L.
Eccles, V.	Mackay of Clashfern, L.	Strathclyde, L.
Elliot of Harwood, B.	Macleod of Borve, B.	Strathcona and Mount Royal, L.
Fraser of Kilmarock, L.	Mansfield, E.	Strathspey, L.
Gainford, L.	Monson, L.	Swansea, L.
Galloway, E.	Morris, L.	Trefgarne, L.
Gibson-Watt, L.	Mottistone, L.	Trenchard, V.
Godber of Willington, L.	Mowbray and Stourton, L.	Vickers, B.
Gowrie, E.	Newall, L.	Vivian, L.
Green way, L.	Northchurch, B.	Westbury, L.

Resolved in the negative, and amendment disagreed to accordingly.

Lord TREFGARNE

My Lords, the House will be much in sympathy with the noble Lord's intention to simplify the wording in Clause 13(5) but I am sorry to say that I am advised that the amendment is defective because, as it stands, it refers to a direction made under subsection (3). But subsection (3) is concerned only with a variation or revocation of a direction; subsection (4) makes clear that a direction, in subsection (1), has an identity separate from both a variation and a revocation, and I hope therefore that the noble Lord will not press the amendment.

Perhaps I should add that if the term "direction" is said to include a variation or a revocation of a direction, then the amendment is still faulty because it would have the effect of requiring a direction revoking a direction to be made under sub-section (1) to specify a period within which the Director is to report to the Secretary of State. I hope in the light of these difficulties that the noble Lord will not press the amendment.

Lord AIREDALE

I am obliged to the noble Lord for that reply, my Lords. I should have thought that a variation or revocation of a direction was itself a direction. But the noble Lord said other things which I shall have to read in Hansard tomorrow and, in the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 35, 36, 37 and 38 not moved.]

Clause 14 [Applications by Crown concerning patents]:

Lord TREFGARNE moved Amendment No. 39: Page 20, line 35, leave out ("body") and insert ("person").

On Question, amendment agreed to.

Clause 15 [Agricultural schemes: special provisions]:

Lord TREFGARNEmoved Amendments Nos. 40 to 44 en bloc:

Page 21, line 20, at end insert— ("( ) The Secretary of State shall not—

1. (a) give a direction under subsection (5) of section 3 above or a consent under subsection (9) of that section in relation to an investigation under that section, or
2. (b) give a direction under section 7(2) or (3) above in relation to a competition reference, or
3. (c) make or vary a reference under section 11 above,

in a case where the person to whom or to whose conduct or activities the investigation or reference relates falls within section 11(3)(d) above unless he has first consulted the relevant Minister.")

Page 21, line 23, after ("1958") insert ("or the Agricultural Marketing Act (Northern Ireland) 1964")

Page 21, leave out from the beginning of line 27 to ("and") in line 28 and insert ("relevant Minister")

Page 21, line 32, after ("the") insert ("relevant")

Page 21, line 32, at end insert— ("( ) In this section the relevant Minister" means—

1. (a) in the case of a board administering a scheme under the said Act of 1958, the Minister who would have power to make an order under section 19 of that Act in relation to that board or the board administering that scheme, and
2. (b) in the case of a board administering a scheme under the said Act of 1964, the Department of Agriculture in Northern Ireland.").

The noble Lord said: My Lords, these amendments are in compliance with an undertaking I gave to the noble Lord, Lord Stanley of Alderley, who, in his fury, does not seem to be here to listen to the concessions which I have to make, but never mind. In the debate in Committee on agricultural marketing boards, I gave an assurance that the Government would be considering further amendments to the Bill in view of the special position of the Ministers for agriculture in relation to these boards under the Agricultural Marketing Act 1958 and the Agricultural Marketing (Northern Ireland) Act 1964. These amendments accordingly provide that the Secretary of State shall not take any action under his powers in the Bill in respect of the boards without prior consultation with the relevant agricultural Minister. The amendments therefore cover both the Secretary of State's powers of veto in relation to the anti-competitive practice provisions of the Bill— that is Clauses 3 and 7— and his powers of referral of the boards to the Monopolies and Mergers Commission under Clause 11.

On Question, amendments agreed to.

Clause 16 [General provisions as to reports.]:

8.17 p.m.

Lord MOTTISTONE moved Amendment No. 45:

Page 22, line 6, at end insert— ("( ) A final draft of any report made under sections 3(10), 8(1), 11(8) and 13(5) above shall be made available to the person or persons who are the subject of the report prior to its publication as indicated below—

1. (a) reports under section 3(10) at least 72 hours before publication,
2. (b) reports under sections 8(1), 11(8) and 13(5) at least 14 days before publication.")

The noble Lord said: My Lords, with permission I will speak at the same time to Amendment No. 46. Like an earlier amendment of mine, these amendments were tabled because there was some unforeseen delay in a letter I was promised by my noble friend. The letter has now been received, but I think it would be helpful to have the substance of that reply declared to the House, and accordingly I beg to move.

Lord TREFGARNE

My Lords, first I should like to repeat, to make it absolutely clear, that it has been the Monopolies and Mergers Commission practice under the Fair Trading Act to check the accuracy of the factual material which may be used in their reports with the persons concerned. This is a long-established practice which works well, even though it is not written into the Fair Trading Act. We have not received representations that this practice has given rise to any problems in the past. I can assure the House once more that the factual material in reports under this Bill will be checked with the firms concerned both by the Monopolies and Mergers Commission and by the Director General. Reports into prices under Clause 13 do raise rather different issues, since they could he extremely general, but I am sure that the Director General will do whatever seems necessary to check the factual accuracy of reports under Clause 13. I hope this meets the point my noble friend has put and that these assurances will enable him to withdraw the amendment.

Lord MOTTISTONE

My Lords, I thank my noble friend very much for that answer and I beg leave to withdraw the amendment.

Amendment by leave, withdrawn.

[Amendment Nos. 46 and 47 not moved.]

Clause 17 [Laying before Parliament and publication of reports]:

Lord TREFGARNE moved Amendment No. 48: Page 22, line 18, leave out ("or body").

On Question, amendment agreed to.

Clause 18 [Information and advice about operation of Act]:

8.20 p.m.

Lord AIREDALE had given Notice of his intention to move Amendment No. 49: Page 23, line 12, after ("about") insert ("any course of conduct which in his opinion constitutes an anti-competitive practice and otherwise about").

The noble Lord said: My Lords, having regard to the last words that the Minister spoke in reply to Amendment No. 2 of the noble Lord, Lord Jacques, I do not think it is necessary for me to move this amendment.

[Amendment No. 49 not moved.]

Lord PONSONBY of SHULBREDE had given Notice of his intention to move Amendment No. 50:

After Clause 22, insert the following new clause:

"Exclusive Copyright Licences

It is hereby enacted that:—

1. (1) The Restrictive Trade Practices Act 1976 shall have effect and be deemed always to have had effect as if it had been made with the addition, in Schedule 3 thereto, of the paragraph set out in Part I of Schedule 1A to this Act.
2. (2) The Restrictive Trade Practices Act 1956 shall be deemed always to have had effect as if it had been made with the addition of the section set out in Part II of Schedule 1A to this Act.
3. (3) The Fair Trading Act 1973 shall be deemed always to have had effect as if it had been made with the addition of the section set out in Part III of Schedule 1A to this Act."

The noble Lord said: My Lords, I do not intend to move this amendment in view of the fact that the noble Viscount has put down Amendment No. 57, which covers the points of this amendment.

[Amendment No. 50 not moved.]

Clause 25 [Suspension of declarations under section 1(3) of Restrictive Trade Practices Act 1976 pending appeals]:

Lord TREFGARNE moved Amendment No. 51: Page 26, line 29, leave out ("Restrictive Practices").

The noble Lord said: My Lords, I wish to speak now to Amendment No. 51, and at the same time to Amendments Nos. 52 to 55 inclusive, as well as Amendments Nos. 56, 60, 61 and 62. When the noble Lord, Lord Ponsonby of Shulbrede, moved amendments in Committee seeking to exempt agreements relating to copyright from the restrictive trade practices legislation, I promised to give sympathetic consideration to this matter. As I indicated in Committee, there appears to have been a fairly general assumption, from 1956 onwards, that agreements relating solely to copyright could not contain restrictions which made them liable to registration. However, more recently some doubt has been cast on this assumption. The problem arises principally in the field of exclusive copyright licences, where the licensor not only promises not to grant a licence to anyone other than the licensee, but also undertakes not to exercise his own rights under the Copyright Act 1956; for example, to publish the work in question. For an agreement to be registrable, it would be necessary that two or more persons should accept relevant restrictions within the meaning of the restrictive trade practices legislation; for example, where joint authors both accept restrictions in connection with a licence.

The Government consider that there would be considerable confusion for anyone concerned with the licensing or assignment of copyright if the law were not speedily clarified. This confusion could arise not merely in the field of books (in which the problem first came to light), but in any branch of copyright. We have considered whether any harmful effects might arise from the exemption of these agreements generally. However, we have concluded that, as in the case of patents and registered trade marks (for which there are already specific exemptions in the Restrictive Trade Practices Act) licences or assignments relating solely to copyright are unlikley to have any significant effects on competition. We therefore accept the case for an exemption. Such agreements, however, will not be totally immune from scrutiny. Where a firm's practices in relation to copyright have the effect of restricting. distorting, or preventing competition in connection with the production, supply, or acquisition of goods, or the supply or securing of services in the United Kingdom, such a course of conduct may be investigated under Clauses 2 to 10 of the Bill. Practices relating to copyright may also, in certain circumstances, be included within a monopoly reference under the Fair Trading Act 1973.

Amendment No. 57, which seeks to give effect to the Government's proposals, draws heavily on the exemption for patents already contained in the Act of 1976. Subsection (1) of the new clause amends the third Schedule to the Act of 1976 by including within the agreements exempted from registration licences granted by the owner or licensee of any copyright, assignment of any copyright, or an agreement for such a licence or assignment. The exemption is conferred in respect of Part II of the 1976 Act (which deals with goods agreements) and of Part III (which deals with services agreements). In either case, the exemption is limited strictly to copyright licences, assignments, or agreements where restrictions are accepted, or information provisions made solely in relation to the work or other subject matter in which the copyright subsists. An agreement which contained other restrictions or information provisions would not be exempted from registration.

In view of the number of agreements which could be effected by the problem which has come to light, the Government consider that retrospection of the exempion is justified. This is achieved by subsection (2) which deems the agreements specified in subsection (1) to have been exempted from registration since 1956, when the current system of registration of restrictive trading agreements was first introduced.

Amendment No. 64, which amends the Long Title, incorporates the present amendment and all other amendments to the restrictive trade practices legislation which have been included in the Bill so far.

For the reasons I have outlined, the Government consider that the problem which has come to light in respect of copyright licensing needs to be remedied promptly, and for this reason we have sought to provide a solution in the current Bill. I beg to move.

Lord PONSONBY of SHULBREDE

My Lords, may I thank the noble Lord for this amendment and the subsequent amendments. I am glad to know that the difficulties have been resolved and that the noble Lord feels that they should be promptly dealt with in this Bill. This is indeed a good omen.

Lord TREFGANRE

My Lords, I am advised that I have not given your Lordships all the information that you should have had, and there are some rather important points that I should mention. What I said earlier was not totally comprehensive. Amendments Nos. 60, 61 and 62 arc technical amendments dealing with interpretation. Amendment No. 62 relocates in a single subsection the interpretation provisions contained in Clause 25 and other clauses to the new clause on exclusive copyright licences, which amend the restrictive trade practices legislation. It mirrors Clause 32(2) and (3) which make similar provisions for Clauses 2 to 24 of the Bill. The remaining amendments in this group are all consequential, with the exception of Amendment No. 61, which includes the expression "the Director" within the interpretation provisions of Clauses 2 to 24. With that further enlightenment I commend the amendments.

On Question, amendment agreed to.

Clause 26 [Suspension of declarations under section 1(3) of Restrictive Trade Practices Act 1976 pending revision of agreements]:

8.28 p.m.

Lord TREFGARNE moved Amendments Nos. 52 to 54: Page 27, line 1, leave out ("Restrictive Practices") Page 27, line 7, leave out ("that") and insert ("the") Page 27, line 27, leave out ("Restrictive Practices").

On Question, amendments agreed to.

Clause 27 [Recommendations by services supply associations]:

Lord TREFGARNE moved Amendment No. 55: Page 28, line 38, leave out ("within the meaning of that section").

On Question, amendment agreed to.

Clause 29 [Exemption of certain undertakings from Restrictive Trade Practices Act 1976]:

Lord TREFGARNE moved Amendment No. 56: Page 30, line 22, leave out subsection (3).

On Question, amendment agreed to.

Lord TREFGARNE moved Amendment No. 57: After Clause 29, insert the following new clause:

"Exemption of copyright agreements from Restrictive Trade Practices Acts

"— (1) The following paragraph shall be inserted in Schedule 3 of the Restrictive Trade Practices Act 1976 (excepted agreements) after paragraph 5:—

"Copyrights

5A.— (1) This Act does not apply to—

1. (a) a licence granted by the owner or a licensee of any copyright;
2. (b) an assignment of any copyright; or
3. (c) an agreement for such a licence or assignment;

being a licence, assignment or agreement such as is described in sub-paragraph (2) or sub-paragraph (3) below.

(2) The licence, assignment or agreement referred to in sub-paragraph (1) above is in relation to Part II of this Act one under which no such restrictions as are described in section 6(1) above are accepted or no such information provisions as are described in section 7(1) above are made except in respect of the work or other subject-matter in which the copyright subsists.

(3) The licence, assignment or agreement referred to in sub-paragraph (1) above is in relation to Part III of this Act one under which—

1. (a) in the case of an order under section 11 above, no restrictions in respect of matters specified in the order for the purposes of subsection (1)(b) of that section are accepted except in respect of the work or other subject-matter in which the copyright subsists; or
2. (b) in the case of an order under section 12 above, no information provision with respect to matters specified in the order for the purposes of subsection (1)(b) of that section is made except in respect of that work or other subject-matter.

(4) In relation to Scotland references in this paragraph to an assignment mean an assignation."

(2) The said Act of 1976 and Part I of the Restrictive Trade Practices Act 1956 shall be deemed never to have applied in relation to—

1. (a) a licence granted by the owner or a licensee of any copyright,
2. (b) an assignment or assignation of any copyright, or
3. (c) an agreement for such a licence, assignment or assignation,

by virtue only of restrictions being accepted or information provisions being made under it in respect of the work or other subject-matter in which the copyright subsists."

On Question, amendment agreed to.

Clause 30 [Orders and regulations]:

Lord TREFGARNE moved Amendment No. 58: Page 30, line 38, after ("10") insert ("11(3A)").

On Question, amendment agreed to.

Clause 32 [Short title, interpretation, repeals, commencement and extent]:

Lord AIREDALE moved Amendment No. 59: Page 31, line 16, after ("provisions)") insert ("as amended by section 23 of this Act").

The noble Lord said: My Lords, as a former practising lawyer, I watch out for any pitfalls that lie in the way of people who have to look at Acts of Parliament, with a view to erecting a signpost to direct anyone away from a pitfall. It must be borne in mind that people who do not read Acts of Parliament from beginning to end and commit to memory the whole thing may have to dart about from section to section. So where there is, as here, an interpretation clause of this Bill which refers one directly to the expressions in the interpretation section of another Act, one may be excused for turning straight to the interpretation section of the other Act, and one may be excused also for not noticing that that section of the other Act to which one has been referred has already been amended by one of the earlier clauses of this Bill. That is what has happened here, and my amendment is simply a signpost which tells the practising lawyer, or whoever it may be, "Don't forget that the section of the other Act you have been referred to has already been amended by Clause 23 of this Bill." I beg to move.

Lord TREFGARNE

My Lords, I am sure your Lordships are again grateful to the noble Lord, Lord Airedale, for his attempts to ensure the maximum clarity in our legislation, but I am afraid I am advised that what he seeks with this amendment is already provided by Section 20(2)of the Interpretation Act 1978, and is therefore unnecessary. Where an enactment has been amended, it is subsequently referred to without specifying the amendments which have been made, and I am advised that to adopt a different approach in this instance might cast doubt in other references in the Bill to enactments which have been amended, such as the reference in Clause 23 itself to the Caravan Sites and Control of Development Act 1960, which has since been amended by the Caravan Sites Act 1968. I do not suppose I have persuaded the noble Lord any more effectively than I have previously this evening, but, nonetheless, I hope he will not press his amendment.

Lord AIREDALE

My Lords, the Minister is quite right: he has not convinced me at all. It could do no possible harm to insert this signpost. But I have always made an undertaking with myself that I will not divide the House on a purely drafting matter, so I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The DEPUTY SPEAKER (Lord Alport)

My Lords, I think I am right in saying that the noble Lord spoke to the three amendments, Nos. 60, 61 and 62, together.

Lord TREFGARNE

That is so, my Lords.

Lord TREFGARNE moved Amendments Nos. 60 to 62:

Page 31, line 20, leave out from ("are") to the end of line 21.

Page 31, line 26, at end insert (""the Director"")

Page 31, line 38, at end insert— ("( ) Section 43 of the Restrictive Trade Practices Act 1976 (interpretation and construction) shall have effect in relation to sections 25 to [Exemption of copyright agreements from Restrictive Trade Practices Act] above as if those sections were contained in that Act and for ease of reference the expressions which are used in those sections and have meanings assigned to them by the said section 43 are—

• "agreement"
• "the Court"
• "the Director"
• "goods"
• "information provision"
• "restriction"
• "services supply association"
• "supply".")

On Question, amendments agreed to.

[Amendment No. 63 not moved.]

Lord TREFGARNE moved Amendment No. 64: Line 11, leave out from ("1973") to ("to") in line 16 and insert ("to make amendments with respect to the Restrictive Trade Practices Act 1976").

On Question, amendment agreed to.