Sitting of 25 June 1947

Preamble
The House met at Half past Two o'Clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS

  MALTA (NEW CONSTITUTION)
  Brigadier Mackesonasked the Secretary of State for the Colonies, when he expects to make an announcement regarding the new Constitution of Malta.
  The Secretary of State for the Colonies (Mr. Creech Jones): The drafting of the necessary Instruments has now reached an advanced stage, and a working party from the Colonial Office, including my legal adviser, is at present in Malta discussing details with the Maltese Government and with representatives of the Maltese National Assembly. I am not at present able to state precisely when the new Constitution will come into force, but I trust that, "as a result of the consultations now taking place, the remaining stages will be accelerated.
  Brigadier Mackeson: While welcoming that statement, which, I have no doubt, will be equally welcomed in Malta, may I ask the right hon. Gentleman if he will consult the Leader of the House to see whether time could be made available when this very important constitutional scheme could be discussed?
  Mr. Creech Jones: There will be an opportunity on a Supply Day, which, I hope, will not be so very far distant.

  AFRICAN COLONIES

    Tanganyika (German Settlers)
    Mr. Niall Macphersonasked the Secretary of State for the Colonies what is his policy in regard to the return of Germans to Tanganyika.
    Mr. Creech Jones: Of the former German residents of Tanganyika Territory who were interned in Southern Rhodesia, those who have shown no Nazi or hostile sympathies and who are desirable residents of the Territory in other respects have been allowed to return to Tanganyika. The remainder have either gained admission to other territories or have been, or are being, repatriated to Germany.
    Mr. Macpherson: Is the right hon. Gentleman aware of the very strong feeling in Tanganyika about this, especially in so far as the settlers are concerned? Could he indicate what special measures he is taking in regard to the return of these Germans?
    Mr. Creech Jones: Yes, there are several Questions today, the answers to which I hope to give a little later.
    Mr. Gammans: Can the Secretary of State say how many Germans have been allowed to return or are to be allowed to return, and whether, if and when they do, they will be given full rights, including the right to hold land?
    Mr. Creech Jones: There is a Question on that matter that I shall answer in a few minutes.
    Mr. N. Macphersonasked the Secretary of State for the Colonies how many German settlers have so far been authorised to return to their prewar holdings in Tanganyika, and how many to resume their prewar professional, commercial and industrial occupations, respectively.
    Mr. Creech Jones: A total of 100 Germans formerly interned in Southern Rhodesia have been allowed to return to Tanganyika. They comprise 49 heads of families—35 men and 14 women—of whom 18 are settlers, three are members of the medical or nursing professions, 19 were formerly engaged in commerce or industry, and nine are returning to live with relations or friends. The position with regard to the settlers is explained in my reply to Question No. 11. Corresponding figures for Germans who were not sent to Southern Rhodesia but remained in Tanganyika during the war are being obtained, and I will send them to the hon. Member as soon as possible.
    Mr. Macpherson: Is the right hon. Gentleman aware that some of the

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    Germans who have been repatriated are at present living in hotels without exercising any profession or business? Can he give the House an assurance that the Germans will not be allowed to come in unless they have some means of support?
    Mr. Creech Jones: Many of the Germans concerned, do, of course, belong, by their long settlement in Tanganyika, to that part of East Africa. They are not returning to their farms though they were settlers, and this question of their future settlement and the positions that they will occupy is now receiving the immediate consideration of the local Government.
    Squadron-Leader Donnerasked the Secretary of State for the Colonies whether he will give an assurance that British citizens who have been leased estates in Tanganyika, previously held by Germans, will not be ejected in favour of returning Germans, and that alternative properties will be offered to the latter; that, if for any reason any British citizen is required to leave such an estate in favour of a returning German, he shall be paid full compensation for any money spent in improving the properties; and that any Germans who have property re-vested will not benefit by the work put into the estates by the present lessees of such ex-enemy properties.
    Mr. Creech Jones: No lessee of an estate in Tanganyika which was formerly held by a German national will be ejected in favour of the former owner during the currency of his lease. The question of the arrangements which will be applied when the present leases expire is being examined by the Tanganyika Government and consideration will be given to all the points to which the hon. Member has drawn attention.
    Squadron-Leader Donner: Is the right hon. Gentleman aware that the first part of his answer will give great satisfaction because quite recently a German arrived at a local station and telephoned the British officer at 6.15 in the morning and expected immediate reinstatement?
    Squadron-Leader Donnerasked the Secretary of State for the Colonies whether in view of the protests of the British Legion in Tanganyika, as well as the bewilderment of African ex-Servicemen, he will give an assurance that no more Germans, other than the 47 families already
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    permitted to return, will be allowed to re-settle in the territory.
    Mr. Creech Jones: 1t is not the intention of the Tanganyika Government that former German residents in Tanganyika should be allowed to return to the territory, apart from the 49 families who have already been given permission to do so.

    Kenya (European Settlers)
    Mr. Skinnardasked the Secretary of State for the Colonies how many European settlers have taken up land in Kenya since the end of the war; how many of these are Kenya nationals; how many are ex-Servicemen from outside Kenya; and how many new settlers have arrived to live in Kenya without taking up land for farming.
    Mr. Creech Jones: I am asking the Acting Governor for up-to-date figures and I will send them to my hon. Friend as soon as I receive them.
    Mr. Skinnard: Can the Secretary of State give the House any information as to the status of the children of European men and women settling in Kenya and taking up land?
    Mr. Creech Jones: I think that all information with regard to settlement and permanent residence in Kenya is supplied by the East African Office. It is now proposed that there should be some immigration legislation, and entries in the future will undoubtedly be controlled.

    European Education (Administration)
    Mr. Skinnardasked the Secretary of State for the Colonies what are the terms of reference given to the Committee on European Education set up by the Central African Council; and whether he will establish the principle that there can be no administrative amalgamation of the education departments of Nyasaland, Northern Rhodesia and Southern Rhodesia, on the basis of racial segregation in schools.
    Mr. Creech Jones: The terms of reference of the committee are, in brief:

    (a) to keep under review the existing arrangements for the education in Southern Rhodesia of European children from Northern Rhodesia;

    (b)to recommend an equitable contribution by the Northern Rhodesia Government in respect of the cost of tuition of such children;

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    (c)to assist the Chief Secretary of the Council in studying the possibility of unification of the European Education Departments in the two territories; and

    (d) to study arrangements for Asiatic and Coloured education in Northern and Southern Rhodesia.

    As regards the second part of the Question, separate European educational establishments are at present in demand to meet practical requirements in all the Territories concerned. The committee has not finally reported and there is no cause for me to make any statement at this juncture.
    Mr. Skinnard: Will not the right hon. Gentleman agree that the educational attainment of the child should be the basis of entering schools provided by public funds?
    Mr. Creech Jones: Obviously, that is a sound principle, but in regard to this problem, one must wait until the committee concerned has made its report.

  FIJI (LEGISLATIVE COUNCIL)
  Mr. Charles Smithasked the Secretary of State for the Colonies by what method representatives of the Fijian people are selected to sit in the Legislative Council; and when it is intended to introduce the method of election.
  Mr. Creech Jones: The five Fijian members are selected by the Governor from a panel of names submitted to him by the Great Council of Chiefs. The Legislative Council of Fiji recently voted by a very substantial majority in favour of the continuance of this method of election, and I am satisfied that no change in the system is at present required.

  PALESTINE

    Anti-Terrorist Measures
    General Sir George Jeffreysasked the Secretary of State for the Colonies whether he has sent instructions to the High Commissioner for Palestine to the effect that law and order are to be maintained and terrorism stamped out; and what representations have been received from the High Commissioner as to the measures which he considers necessary for this purpose.
    Mr. Creech Jones: The High Commissioner is well aware of the policy of His Majesty's Government, which is that every effort should be made to maintain law and order in Palestine and to suppress lawlessness and terrorism. He has indicated that his existing instructions give him all necessary latitude.
    Sir G. Jeffreys: Is it not a fact that the High Commissioner has recently intimated that if the Armed Forces were allowed to exert their full power against the whole Jewish community, terrorism could be eradicated in a very short time indeed? In view of that fact, why is such authority not given to the High Commissioner? Indeed, why are not orders given to him to use the full power of the Army?
    Mr. Creech Jones: There has been no withholding of the necessary authority to the High Commissioner in respect of the representations he has made. Indeed, he has always taken the view most strongly that suppression of terrorism is not a matter of military operations so much as a matter of police work.

    Explosion, Tel Aviv
    Mr. Lipsonasked the Secretary of State for the Colonies if he will make a statement on the failure of the recent attempt to blow up the British headquarters at Tel Aviv when a Palestinian Jew, Zeev Werber, sacrificed his life to save the lives of 300 British troops.
    Mr. Creech Jones: Shortly after 11 o'clock on 18th of June an explosion occurred in the basement of a house near the Military Cantonment in Citrus House, Tel Aviv. On investigation the body of a young Jew was found at the opening of a tunnel leading in the direction of Citrus House. The tunnel was timbered and construction must have been in progress for some time. In the basement was a chalked message in Hebrew, reading, "The Hagana were here. We want you by force not to carry out your evil intention. Signed Hagana." Outside the building was a vehicle loaded with cement which had been removed without permission from the Municipal garage. It appears that the Hagana had learnt that an attempt by terrorists to blow up Citrus House was in progress, and had decided to frustrate it by blocking the entry to the tunnel with cement. The entry had, however, been booby trapped; and when

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    the leader of the Hagana party, identified as Zeev Werber, the son of a municipal employee in Tel Aviv, attempted to enter, he was fatally wounded by an explosion. His funeral in Tel Aviv the next day was attended by representatives of the District Commissioner and of the Superintendent of Police in recognition of the fact that he had lost his life as a result of action which had probably prevented a serious terrorist outrage and consequent British casualties.
    Mr. Lipson: Is not co-operation on the part of Hagana very much to be welcomed in combating terrorism? May I ask whether any pension will be payable to the dependents of this young Jew who gave his life? Is the right hon. Gentleman also aware that in the first report in "The Times" this man was described as one of the terrorists? Fortunately, the "Express" had the correct version. Is it not rather unusual for the "Express" to be more correct than "The Times"?
    Mr. Creech Jones: I cannot answer the last part of the question but it may be that "The Times" misreported it. It is a fact, of course, that Hagana has played some limited part in trying to root out terrorism and suppress this evil. I must say that the British Government would wish for a larger measure of cooperation than has so far been forthcoming.
    Mr. Lipson: Will the right hon. Gentleman answer the part of my question dealing with compensation?
    Mr. Creech Jones: I should require notice of that.
    Squadron-Leader Fleming: May I ask whether any steps are being taken to recognise the gallantry of this young Jew?
    Mr. Creech Jones: That is a matter for the Palestine Government. I confess that we have not given consideration to it.

  COLONIAL EMPIRE

    Press Conferences
    Wing-Commander Roland Robinsonasked the Secretary of State for the Colonies whether he will now arrange to meet at least once a month the corre-
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    spondents of colonial newspapers in London and the editors of other journals concerned with Colonial matters in order to enable the Colonial newspapers concerned to be kept fully up to date with activities of his Department.
    Mr. Creech Jones: The information Department in the Colonial Office is now being re-organised. When this reorganisation is complete it is proposed to institute a regular monthly press conference particularly for the correspondents of Colonial newspapers in London and for editors of other journals concerned with Colonial matters. These conferences will normally be conducted by my Director of Information Services.

    News Releases
    Wing-Commander Robinsonasked the Secretary of State for the Colonies whether he is aware that the London correspondents of Colonial newspapers were given no access to his Department's release of news about major schemes of development in the Colonies; that at the conference several days afterwards, no additional information was given to them; and whether he will give an assurance that in all releases of news with regard to Colonial developments, the correspondents of Colonial newspapers in London and all journalists specialising in Colonial matters will be enabled to get information published in Colonial newspapers at the same time as it can be published in London and dispatched overseas by the news agencies.
    Mr. Creech Jones: I presume that my hon. and gallant Friend refers to reports recently published of plans to review the production of foodstuffs and other essential commodities in the Colonial Empire. No news release on this subject was made by the Colonial Office, but a reference in this House gave rise to speculation in the Press. As a result my Press Officers were given information which was then made available to all inquirers. In view of the interest in the subject it was thought that representatives of the Colonial specialist Press would welcome an opportunity of meeting a senior official of the Colonial Office and a conference was arranged accordingly. The purpose of this conference was not to release, news but to give background information the answer to the last part of the Question is; "Yes, Sir."

    Commodity Production
    Sir John Mellorasked the Secretary of State for the Colonies when he proposes to issue a White Paper concerning commodity production in the Colonial Empire.
    Mr. Creech Jones: No, Sir, but with the permission of the hon. Member, the House, and Mr. Speaker, I will make a statement at the end of Questions.

    Governors and Civil Servants (Salaries)
    Mr. Gammansasked the Secretary of State for the Colonies whether the salaries of Colonial Governors and Colonial civil servants have been augmented to meet the increased cost of living; and whether, in view of the natural reluctance of Colonial governors to raise the question of their emoluments, he will, if satisfied that there are good grounds for doing so, bring the point to the notice of the local legislatures.
    Mr. Creech Jones: In nearly all Colonies the salaries of civil servants either have been revised or are in process of revision. Cost of living allowance schemes operate in practically all Colonies where salaries have not yet been revised. Improvements in the effective emoluments of Governors—which include salary, allowances and privileges—have also been made in a number of cases and will be considered in others as and when occasion arises.
    Mr. Gammans: But what is happening in the Colonies where no increases have taken place? Does not the right hon. Gentleman feel that he has a responsibility in view of the fact that these officers are appointed by the Secretary of State?
    Mr. Creech Jones: Of course, we have a measure of responsibility, but I think that I can say in all cases, in all the territories throughout the Empire, this matter has received the attention either of the Colonial Office or myself directly and certain steps have been taken.
    Mr. Stanley Prescott: Can the right hon. Gentleman say how many of them get a salary of £3,700 a year or above?
    Mr. Creech Jones: I should require notice of that question.

    Development Plans (Dominion Assistance)
    Brigadier Mackesonasked the Secretary of State for the Colonies what steps His Majesty's Government has taken to ensure that the Dominions are allowed to play a full part in the formation and execution of plans for expanding the output of industry and agriculture in the Colonies.
    Mr. Creech Jones: The United Kingdom Government are aware of the part which the Dominion Governments can play in the field of Colonial development. Already in a number of important respects, close co-operation has been established. So far as expansion of production in industry and agriculture is concerned, the Dominions are, of course, much occupied at the moment with their own economies and the expansion of their own productive capacity. The assistance of the Dominion Governments will, I am sure, be readily forthcoming as necessary in the larger Colonial development plans, and there will undoubtedly be opportunity for Dominion investment in this field.
    Major Legge-Bourke: Have the Dominions been invited to join the Economic Advisory Council, and what has the Council done so far?
    Mr. Creech Jones: I hope that I may be in a position to circulate a statement to the House in regard to the work of the Economic and Development Council, but in all our development work there has been very close contact with the Dominion Governments, and we have received in some of our schemes very practical assistance indeed.
    Brigadier Mackeson: Would the right hon. Gentleman try to let us have that before the Supply Day, if that is possible?
    Mr. Creech Jones: I am hurrying it on, but it is a matter for the printers now.
    Mr. Wilson Harris: Has any Dominion Government made any contribution to the Colonial Development Fund?
    Mr. Creech Jones: I am not aware of it.

    Education, Tanganyika
    Brigadier Mackesonasked the. Secretary of State for the Colonies whether

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    he has examined the recommendations of the Development Commission of Tanganyika as to African educational requirements in the next 10 years; and how these recommendations are to be financed.
    Mr. Creech Jones: I have examined the recommendations, which have been generally endorsed by the Advisory Committee on Education in the Colonies, and I have informed the Governor that I am prepared to approve them. It is proposed that the ten-year plan shall be financed as follows: From the Territory's resources and surplus balances, £3,537,000; from the resources of the Native Administration, £605,000; from the Colonial Development and Welfare Vote, £1,250,000 — total, £5,392,000. These financial arangements are subject to the approval of the Tanganyika Legislative Council as far as expenditure from the Territory's funds is concerned and to the concurrence of my right hon. Friend the Chancellor of the Exchequer as regards the proposed grant under the Colonial Development and Welfare Act. The plan has still to be considered also by the Advisory Committee on African Education in Tanganyika. I am sending a copy of the plan to the hon. and gallant Member.

    TRINIDAD (COST OF LIVING)
    Mr. H. Hyndasked the Secretary of State for the Colonies what action has been taken by the Government of Trinidad to implement the recommendation of its Cost-of-Living Committee that the prices of essential foodstuffs should be subsidised; and whether any action is to be taken in response to the committee's criticism that the Government's import policy compels Trinidad to buy in a dear market.
    Mr. Creech Jones: A policy of food subsidisation has been in operation for some years in Trinidad. Proposals for increasing subsidisation expenditure in order to reduce the cost-of-living index by 10 points from 220 to 210 have recently been agreed in principle by the Finance Committee. It is proposed that the cost of these measures should be met partly from Trinidad revenues and partly from a grant by His Majesty's Government. The necessary vote to authorise such a grant will be brought before Parliament in due course. As regards the second part of the Question, the Governor reports that
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    import control is effected with the object of conserving "hard currency," and in some instances this involves purchases from the sterling area at higher prices than those for which similar goods could be purchased from "hard currency" countries. Since April last, however, licences have been issued for the importation from any source of certain essential consumer goods which are in very short supply.
    Mr. Oliver Stanley: Could I ask the Secretary of State whether this assistance from the Colonial Office Vote to reduce the cost of living where that is increased by the necessity of sterling control, will be extended to other Colonies which are in the same position?
    Mr. Creech Jones: I cannot give a definite promise that it will be extended, but it is a matter which is under constant discussion with the Treasury, and I think both the Colonial Office and the Treasury take a reasonably sympathetic view in regard to the matter.
    Squadron-Leader Donner: Will the right hon. Gentleman say whether it is possible to extend similar help to other West Indian Colonies?
    Mr. Creech Jones: I have just said that the whole problem has the constant attention of the Colonial Office and the Treasury.

  ROYAL NAVY

    Docks, Rosyth and the Clyde
    Colonel J. R. H. Hutchisonasked the Parliamentary Secretary to the Admiralty when he proposes to make a statement regarding the future of Rosyth dockyard and the project of establishing a graving dock in the Clyde.
    The Civil Lord of the Admiralty (Mr. Walter Edwards): The future of Rosyth Dockyard is still under active consideration, and although I cannot say when a decision will be taken, I hope that it will be at no very distant date. The question of a new graving dock requires detailed examination of a number of different factors and is unlikely to be decided for a considerable time.
    Colonel Hutchison: May I ask the Civil Lord whether the Chiefs of Staff have given any decision about the strategic advantages of Rosyth which was so apparent during the two great wars?
    Mr. Edwards: The Chiefs of Staff are, of course, taken into consultation on these matters, and everything they have said is being borne in mind.
    Mr. Gallacher: Would the Civil Lord arrange for me to have a talk with the Chiefs of Staff, so that I can get them to make up their minds over this question, which has been hanging fire for two years now?
    Mr. Edwards: I am afraid I shall have to ask the Chiefs of Staff whether they would consider that.
    Commander Galbraith: Does the hon. Gentleman realise the great handicap to recruiting in Scotland and the North-East coast of England as a result of there being no home port in this part of the country?
    Mr. Edwards: We have been shown no evidence of that.
    Mr. Thornton-Kemsley: Will the hon Gentleman bear in mind that Rosyth is the only docks on the North-East coast and that it provides deep water anchorage for the whole of the Home Fleet in a comparatively safe area?
    Mr. Edwards: We are, of course, fully aware of that.
    Mr. Kirkwood: When will the Admiralty make up their minds that we are to have this graving dock on the Clyde, where we have built the finest ships which have sailed the Seven Seas, including the "Queen Mary," the "Queen Elizabeth" and the "Vanguard." Is the Civil Lord aware that these ships are going down to Southampton in order to be equipped, when they could come back to the Clyde to be finished? We have been pushed off for years; surely, it is time for them to decide? I would like to know when they are coming to a decision?
    Mr. Edwards: I think the answer to that supplementary question is given in the second paragraph of my original reply. My hon. Friend will find that we are examining the matter, but it must take some time before a decision can be reached.
    Mr. Kirkwood: The Admiralty have been examining it ever since the present Government came in. We do not want an examination, we want a dock.
    Commander Noble: During discussions with the Chiefs of Staff, would the Minister bear in mind the apparent influence of the Minister of Defence in this direction?
    Colonel Hutchison: In view of the unsatisfactory nature of the reply, and the period of time over which this matter has dragged on, I beg to give notice that I will raise it on the Adjournment.

    Allowances, Greece
    Sir Wavell Wakefieldasked the Parliamentary Secretary to the Admiralty if he is aware of the hardship being caused to naval officers and ratings, now serving in Greece, due to the inadequacy of their allowances on account of the present rate of exchange between drachma and sterling; and what action he is taking to remedy this hardship.
    The Parliamentary and Financial Secretary to the Admiralty (Mr. John Dugdale): Officers and men of the Royal Navy now serving in Greece are in the same position as members of the Army in this matter, and I would therefore refer the hon. Member to the reply given yesterday by my right hon. Friend the Secretary of State for War. The allowances for members of the Naval forces will be reviewed at the same time as those of the other Services.
    Sir W. Wakefield: But is the Parliamentary Secretary aware that this matter has been dragging on now for 18 months? Why cannot this be put right and a decision be given now? Is he further aware that this hardship is greatly increased by the quite inadequate stocks kept by N.A.A.F.I., and can he not do something in that direction to try to meet this hardship?
    Mr. Dugdale: As regards the second part of the supplementary question, that seems to be another matter. As regards the first part, my right hon. Friend the Secretary of State for War said yesterday that the allowance was reviewed recently. It has been reviewed from time to time and will be reviewed again.
    Lieut.-Commander Gurney Braithwaite: But in view of the fact that the Secretary of State for War told us yesterday that this matter is being examined jointly by the Navy, Army and Air Force, will the Senior Service perform its proper function

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    of taking the lead in this matter and see that review and discussion are translated into action and remedy?
    Mr. Dugdale: They act in co-operation with the other Services. It is not a question of taking the lead; they all act together.
    Mr. Piratin: Will not my hon. Friend agree that the best way out of this dilemma is to bring all our officers and men back from Greece?
    Vice-Admiral Taylor: Can the Parliamentary Secretary inform the House whether action will be taken in regard to the review which is being undertaken by the Services in this matter, and will it not be a matter of ordinary procedure that the Services should take action in accordance with what is the currency in these nations and adjust the pay of the Services accordingly?
    Mr. Dugdale: We are certainly anxious to take action as soon as the review can be completed, but I cannot promise when it will be. I hope it will be soon, because we are just as anxious as hon. Members are to see that these men are not put to any hardship at all.
    Commander Noble: Is it not a fact that the Treasury has already agreed to this increase for the staffs of the Embassy and the Economic Mission, and why should there be any delay with regard to the Services?
    Mr. Dugdale: That seems to be quite another question.
    Hon. Members: It is not.
    Mr. Dugdale: I have no doubt that it will be taken into account when we are discussing the matter with the Treasury.

    Aircrews (Operational Stars)
    Sir Ian Fraserasked the Parliamentary Secretary to the Admiralty whether the Royal Navy intend extending to naval aircrews the same rules with regard to the granting of operational stars to ferry and transport pilots as now apply in the R.A.F.
    Mr. Dugdale: Yes, Sir.
    Sir I. Fraser: Will the hon. Gentleman inform their Lordships that this decision will give some pleasure, and will he-tell
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    them that it is satisfactory to the friends of the Senior Service to see them so successfully trying their wings?

    H.M.S. "Terrible," Devonport (Electric Cable)
    Mrs. Middletonasked the Parliamentary Secretary to the Admiralty what use has been made of the electric cable which had been reeved, clipped, and connected to H.M.S. "Terrible" at Devonport and which, under a recent order, consequent upon alterations of specifications, was removed.
    Mr. Walter Edwards: The cable removed from H.M.S. "Terrible" will be used as far as possible in other ships and shore establishments.
    Mrs. Middleton: Is my hon. Friend aware that the cable could have been salvaged, but that was not done, and will he please explain to the House why this wanton wastage is allowed in the dockyards, and what he proposes to do in order to stop it?
    Mr. Edwards: I cannot see where the question of wanton wastage comes into it. We say that we shall use the cable as far as possible in other ships and establishments, and what cannot be used will be handed over to salvage.
    Mrs. Middlton: Is the Civil Lord aware that the cable was cut into short lengths which it is not possible to use again and that rewinding could have taken place, salvaging a great part of it, if care had been taken in giving orders to that effect?
    Mr. Edwards: If my hon. Friend likes to give me details of the allegations made, I will go into them carefully for her, but my advice up to now is that there has been no misuse of this cable at all.

    Oil Waste Discharges, Cawsand Bay
    Mr. Douglas Marshallasked the Parliamentary Secretary to the Admiralty if he is aware that Maker Parish Council has complained that landing craft have been discharging waste fuel-oil in Cawsand Bay; that the foreshore has been covered in oil and people have had their clothes ruined; and if he will take the necessary action to prevent a recurrence of this nuisance.
    Mr. Dugdale: I am informed that the Maker Parish Council wrote to the King's

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    Harbour Master, Plymouth, on 9th June complaining of oil fuel pollution in Caw-sand Bay, and that an acknowledgment of this letter was sent by the King's Harbour Master on 10th June asking for details of the time and date of the alleged pollution in order that the matter might be fully investigated. The Council's reply is still awaited. I can assure the hon. Member that the Naval authorities at Plymouth make every effort to prevent contamination by His Majesty's ships. King's Regulations and Admiralty Instructions, in fact, state that:
    "to pump overboard in harbour or basin, or within 50 miles of any coast, any oil fuel, oily refuse, or bilge water, etc., which may contain oil fuel residue is strictly forbidden."
    Mr. Marshall: Is it possible for the Admiralty to find out what type of vessels were in the vicinity of Cawsand Bay at the time mentioned?
    Mr. Dugdale: I can state that, among other vessels, there were six landing craft which have been sold to the Greek Navy and are on their way to Greece. They were there, and it is possible that pollution may have been caused by them, but I cannot say, because we got the information so late that it was impossible to take any action.
    Mr. Marshall: If information does reach the Admiralty that this occurrence had nothing to do with the Royal Navy, will the hon. Gentleman give publicity to the fact?
    Mr. Dugdale: Certainly.

    Coal Consumption (Tugs)
    Mrs. Middletonasked the Parliamentary Secretary to the Admiralty how much coal is consumed each week in stoking up tugs, other than duty tugs, which are subsequently not brought into use.
    Mr. W. Edwards: Coal-fired tugs are used only in naval dockyards. All those in use are duty tugs and are normally employed at some period during the day. In any isolated case where a tug is for some reason not used, the coal consumption under banked fires is under five cwt. per week.
    Mrs. Middleton: Is my hon. Friend aware that tugs other than duty tugs are stoked up every Saturday morning and
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    not subsequently used, and will he take steps to see that this wastage of fuel is stopped immediately?
    Mr. Edwards: I am afraid that my hon. Friend and myself are getting different information. If my hon. Friend would be good enough to let me have the source and type of information which she receives, I shall be only too glad to go into the matter.

    Blackburn Aircraft
    Mr. J. Langford-Holtasked the Parliamentary Secretary to the Admiralty, what aircraft produced by the Blackburn Aircraft Company have been accepted for service by his Department since 1939; which of these types were rejected for any reason; and after what period of service.
    Mr. Dugdale: Since 1939, the following types of aircraft produced by the Blackburn Aircraft Company for the Navy have been accepted for service:

    (a) The Firebrand torpedo-strike air craft.

    (b) The Swordfish torpedo-spotter-reconnaissance aircraft.

    (c) The Barracuda torpedo-bomber aircraft.

    The Swordfish and Barracuda were designed by the Fairey Aviation Company. None of these aircraft was rejected after service; the Firebrand and Barracuda are in use but the Swordfish has been withdrawn on account of obsolescence.
    Mr. Langford-Holt: Is the hon. Gentleman aware of the fact that not one of these aircraft used by the Fleet Air Arm has been a success, and that the performance of the Swordfish was completely ruined when the manufacture was taken over by this company, and that at least one of the aircraft taken over by this firm was little more than a flying death trap?
    Mr. Dugdale: No, I cannot accept all those statements, and I ask the hon. Member to await the reply to his next Question which, I think, will answer some of them. From my personal experience, the Barracuda is not as bad as all that. I have landed on an aircraft carrier in one myself.
    Mr. Langford-Holtasked the Parliamentary Secretary to the Admiralty (I) whether the Board of Admiralty is entirely satisfied with the

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    quality, performance and suitability for naval air service of the Blackburn Firebrand;
    (2) for what purpose it is intended to use the Blackburn Firebrand; and for what purpose this aircraft was originally designed.
    Mr. John Dugdale: The Firebrand is primarily for torpedo attack. This aircraft was originally designed as a single-seater fighter to be fitted with the Sabre engine. The use of this engine by the Navy had, however, to be given up owing to the greater need of the Royal Air Force. The substitution of another type of engine would have involved a major re-design of the aircraft if it were to fulfil its original function, and before this could have been completed, the aircraft would have been out-dated as a fighter. It was, therefore, decided to develop it for torpedo work. The Firebrand, with the modifications incorporated, has now been cleared for Service use, and the type has satisfactorily completed deck-landing and other tests. A new squadron of Firebrands has just been formed and these aircraft are likely to be retained for front line service until a more modern type is available.
    Mr. Langford-Holt: Is the hon. Gentleman aware that this aircraft has reached Mark IV before even going into service with one squadron and that even today far the greater part of its time is spent on the ground on account of unservice-ability? Is the hon. Gentleman aware that the Firebrand is now out of date?
    Mr. Dugdale: Every aircraft becomes out of date extremely quickly, but this aircraft is in use, and will be in use until a better type is evolved.
    Mr. Langford-Holt: This has been messed about with for five years.
    Mr. Mikardo: Is my hon. Friend satisfied that the contact between the designers of the Fleet Air Arm and constructors is sufficiently close, and that it takes place at a sufficiently early stage in development?
    Mr. Dugdale: Yes, I am so satisfied and I wish to make it perfectly clear that had the original plans gone through, this plane would have been in service long ago. But at that moment the needs of the Royal Air Force were considered paramount and the needs of this particular
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    plane for the Navy were sacrificed for that purpose at the time.

    Petty-Officers (Pay Code)
    Commander Maitlandaske the Parliamentary Secretary to the Admiralty whether he is satisfied that sufficient incentive is offered to petty-officers and chief petty-officers by the new pay code to make a career in the Royal Navy; and what proportion of these ratings, eligible to sign on to complete for pension, are taking advantage of the opportunity to do so.
    Mr. W. Edwards: The new pay code has not been in operation long enough to enable us to give considered opinion whether or not there is now a sufficient incentive to encourage men to take up a career in the Royal Navy. With regard to the second part of the Question, I regret that I am at present unable to add to the information given in the reply of 30th April to the hon. and gallant Member. I will, however, inform him further as the necessary figures become available.
    Vice-Admiral Taylor: Can the Civil Lord say to what extent the petty-officer and chief petty-officer, particularly men with families, are better off under the new pay code than they were before?
    Mr. Edwards: This matter was very fully discussed in the Navy Estimates last year. We feel that under the new pay code they had a far better career in the Navy than has ever been the case before.
    Major Bruce: But is my hon. Friend aware that the new pay code varies to the disadvantage of a young petty-officer compared with comparable grades in the other two Services?
    Mr. Edwards: I am afraid I cannot accept that. The new pay code has been devised to achieve equality between the three Services. It may be true that a young petty-officer is not getting as much as an old petty-officer, but eventually he will do so.
    Mr. Willis: Is my hon Friend aware that many chief petty-officers today are worse off than 25 years ago?
    Mr. Edwards: They may be worse off than 25 years ago, but I am sure my hon. Friend will agree that they are far better off than 10 years ago.
    Commander Maitland: Is the hon. Gentleman aware that throughout the Navy there is considerable doubt as to whether the new pay code is going to improve the welfare of the men in the Navy? Unless he can give the House a satisfactory answer, will he appoint a Committee to consider whether another new pay code should be introduced?
    Mr. Edwards; I am afraid I cannot agree that there is considerable doubt about the effects of the new pay code. Apart from the pay codes, we are endeavouring to make conditions of service as easy as possible, and better than they have ever been for the chief petty-officers and petty-officers, and that has to be taken into consideration.

    Upper-Deck Ratings (Training System)
    Commander Maitlandasked the Parliamentary Secretary to the Admiralty whether he proposes to make any changes in the present system of training upper-deck ratings in gunnery and other technical subjects; and whether he is satisfied that the present system, particularly that part of it which has to be carried out at sea, is producing as good results as the old system involving non-substantive rates.
    Mr. W. Edwards: There has not been sufficient time, and circumstances have been too abnormal, for adequate experience to have been gained on the present system of training of upper-deck ratings in technical subjects. I can, however, say that no change in the system is at present contemplated.
    Commander Maitland: Does not the Civil Lord realise that just as my previous Question was about welfare, so this deals with efficiency, neither of which is improved by the present pay code. Will he not, therefore, consider setting up a technical committee to examine the whole matter?
    Mr. Edwards: I must say that the information which has been provided by the people who have charge of the Navy—the Naval Staff—indicates that that allegation bas no foundation whatever.

    Surrendered German Submarines
    Commander Maitlandasked the Parliamentary Secretary to the Admiralty how many German submarines were
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    surrendered to the United States and Soviet Governments under the terms of the Potsdam Agreement; how many of these have now been destroyed in each case; and when this information was received.
    Mr. W. Edwards: As was stated in the reply given to the hon. Member for Londonderry (Sir R. Ross) on 30th April last, ten German submarines were allocated to each of the United Kingdom, United States, and Soviet Governments at Potsdam. The remainder were to be destroyed by 15th February, 1946, and of these, four were, reported by the United States Navy in March, 1946, as having been sunk by them by the appointed date. Eleven others were held by the Soviet Navy, and the Soviet Government gave a further undertaking last March that they would fulfil their obligations in this matter by August this year.
    Commander Maitland: Can the hon. Gentleman tell the House that these, I think, 21 submarines are all the German submarines which are held by the Soviet Government at the present time in contravention of the Potsdam Agreement?
    Mr. Edwards: Actually the number which they are responsible for destroying is 11. They have promised us that they will do that by August of this year.
    Sir Ronald Ross: Was any reason given or known to the Admiralty why these submarines should not have been destroyed by the agreed date?
    Mr. Edwards: No actual reason has been given, but we are justified in accepting the assurance they have given.

    Foreign Service (Reliefs)
    Mr. David Jonesasked the Parliamentary Secretary to the Admiralty whether he is aware that personnel of H.M.S. "Wild Goose," now at a foreign station, "are more than three months overdue for relief; that the relief is still at Colombo and cannot leave there until the end of July; and whether he will arrange that men who have served long periods on foreign stations are relieved on time and that reliefs are sent from this country in sufficient time to effect relief at the proper date.
    Mr. Dugdale: I can assure my hon. Friend that every effort is made to relieve

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    men serving overseas on time. In view of his statements I am, however, making inquiries in the case of H.M.S. "Wild Goose," and will inform him further.

    Special Entry Cadets (Grants)
    Mr. Benn Levyasked the Parliamentary Secretary to the Admiralty if he can give any indication as to the working of the scheme of financial assistance for special entry cadets introduced last year.
    Mr. Dugdale: Yes, Sir. Since the scheme was introduced last September grants varying from £10 to £150 have been made to the parents of 58 cadets entered through the Special Entry Group of examinations. The parents of these boys form an interesting cross section of the community ranging from gas stoker, colliery overman and bench engineer to cost accountant, mercantile marine officer and schoolmaster. There is no doubt that it would have been impossible for a great many of these boys to enter the Royal Navy as officers without this financial assistance. I think the House will agree that the scheme has achieved its object of broadening the field of entry and made it possible for any boy who reaches the required standard to become a Special Entry Cadet regardless of the financial circumstances of his parents.

    Prize Money
    Mr. Chetwyndasked the Parliamentary Secretary to the Admiralty if he is in a position to state the amount of prize money available; and when it will be paid.
    Mr. Dugdale: As after the 1914–18 War, a considerable time must elapse before the amount of prize money can be determined because in condemning ships and cargoes seized in prize, the Prize Courts throughout the Empire have not distinguished between droits of the Crown and droits of Admiralty. We are trying, in close consultation with the Dominions, India and Burma, to estimate as accurately as possible the amounts which should become available, as droits of the Crown, to be granted for the benefit of the Naval and Air Forces of the Empire. Until returns are received in a common form from all Empire Prize Courts, it will not be possible to frame a sufficiently accurate estimate of the amount or to forecast when grants can be made. I must, however, repeat my former warning that the
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    amount will certainly be very much smaller than after the 1914–18 War. Legislation will also be necessary, and this cannot be introduced before next Session.
    Lieut.-Commander Braithwaite: Will the hon. Gentleman tell us whether the Board of Admiralty have yet decided what will be the service qualification for entitlement to this prize' money when it is available?
    Mr. Dugdale: No, Sir. That has not definitely been settled.

  POST OFFICE

    Branch Office, Highbury Corner
    Mr. Eric Fletcherasked the Post master-General when the Highbury Corner branch post office will be reopened.
    The Postmaster-General (Mr. Wilfred Paling): Unless unforeseen difficulties arise, I hope it will be possible to reopen a branch post office at Highbury Corner early next year. Negotiations for the lease of suitable premises have recently been concluded and the necessary building alterations, which are being given priority, are in hand.

    Collections and Deliveries
    Mr. Peter Freemanasked the Postmaster-General whether he is aware that letters posted in London before 6 p.m. are often not delivered in Newport until 36 hours later, although the train journey is less than three hours; and if he will take steps to see that delivery is effected by the first post following such collections.
    Mr. Wilfred Paling: Letters posted in London in time for the 6–6.30 p.m. collection are due to be delivered in Newport (Mon.) by the first delivery on the following week-day. Unfortunately, there have been occasions recently when staffing difficulties in London have made it impracticable to maintain all due course connections and certain letters for Newport (Mon.) may have suffered delay; remedial measures have, however, been taken which I am confident will prove effective.
    Mr. Peter Freemanasked the Postmaster-General whether he is aware that delivery of letters in Newport takes

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    place between 7 and 8 a.m. and a second delivery about noon; and whether, during the present temporary restrictions, he will arrange for the second delivery in the afternoon instead.
    Mr. Wilfred Paling: The postal services in Newport (Mon.) and in towns throughout the country have been modified in order to save manpower and to release staff for production. I regret that an afternoon delivery at Newport (Mon.) could only be arranged by drawing on the manpower which the Post Office has been asked to release for productive industry.
    Mr. Freeman: Is my right hon. Friend aware that by having two deliveries in the morning, one following the other almost immediately, many letters which would otherwise reach their destination the same day are held over until the following day, and would he make arrangements so that there would be an afternoon as well as a morning delivery?
    Mr. Paling: With our present manpower position I do not think it is possible to do that. We have arranged the second delivery so that business men receive their letters in time to reply to them the same day.
    Mr. Keeling: Does not the first reply of the right hon. Gentleman flatly contradict the assurance of the Assistant Postmaster-General a few days ago that letters posted before 6.30 p.m. in London are delivered all over the country next morning except in remote spots like Penzance and Thurso?
    Mr. Paling: I think that question refers to the previous Question.
    Mr. Keeling: Yes.
    Mr. Paling: I said that this particular trouble in Newport has been due to certain difficulties and that we had tried to alter them. I think we have done that.
    Mr. Randall: Would not the Postmaster-General agree that if the request in this Question was acceded to, and there was more call upon labour throughout the country, it would mean the employment of part-time labour and split attendances for the staff; and would not he agree that most of the members of the staff in my hon. Friend's constituency would object to that sort of thing?
    Mr. Peter Thorneycroft: Why is Newport singled out for this peculiar treatment when there are many thousands of people unemployed in South Wales?
    Mr. Paling: Newport is not singled out for treatment as suggested in that question, which relates to the Question I answered previously. As I said, difficulties in Newport were particular difficulties which arose from a certain line of action. We have dealt with that.
    Sir Henry Morris-Jones: Could the right hon. Gentleman explain why a London newspaper is delivered in Wales every morning punctually whereas a letter frequently takes two days?
    Mr. Paling: No, I cannot tell the hon. Member why on information like that. If he will give me the full information and let me have the dates, I will deal with the matter.
    Mr. Martin Lindsay: Does not the Postmaster-General recognise that during the past few months there has been a grave deterioration in postal delivery services not only in Newport, but all over the country?
    Mr. Paling: What I do realise is that owing to the changes made and the restrictions in services, there has had to be a certain re-allocation of men, in particular on new duties, and it has taken these men some time to "bed down" and get used to their new routine.
    Lieut.-Cammander Braithwaite—
    Mr. Speaker: We have been on this Question long enough. Mr. Osborne.

  WORKING HOURS (GOVERNMENT POLICY)
  Mr. Osborneasked the Prime Minister what is the Government's policy with regard to the five-day week; and if he is satisfied that its general introduction would allow export targets to be reached.
  The Prime Minister (Mr. Attlee): The question of working hours is one which falls for determination in accordance with the circumstances of each individual industry. The considerations which the Government feel should guide decisions on this matter are set out in paragraph 136 of the Economic Survey for 1947 (Cmd.

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  7046), to which I would refer the hon. Member. The last part of the Question is purely hypothetical.
  Mr. Osborne: Is it not quite clear that the last part of the Question is not hypothetical, and that if a five-day week is granted to one industry another industry immediately demands it, and therefore, we have to face the fact—
  Mr. Speaker: Questions must seek for information, and not produce argument.
  Mr. Osborne: Then may I ask for information, Mr. Speaker, whether the Prime Minister will make an appeal to both sides of the House, and to both sides of industry not to follow the shorter working week in view of our great need for increased output?
  The Prime Minister: I did not quite catch the hon. Gentleman's question.
  Mr. Osborne: Would the Prime Minister appeal to both sides of industry to stop this run on the shorter working week until output has been materially increased ?
  The Prime Minister: I have explained that this must be taken industry by industry. Experience has shown that in some industries there is no slackening or falling off in production through the changes in hours. Each case has to be considered on its merits and it is for the two sides of industry to decide.
  Mr. Henry Usborne: Is the Prime Minister aware that in a number of engineering firms with which I am acquainted, where the five-day week was introduced by the management—I admit, reluctantly —they have now found by experience that the change has produced efficiency and they are very glad of it?
  The Prime Minister: That tribute is a particular example of what happens.
  Mr. Thornton-Kemsley: Will the Prime Minister look into this alleged 'bedding down "of postmen which seems to be the root cause of the delay in delivery of letters?
  Mr. Stokes: Is not my right hon. Friend aware that in some sections of the heavy engineering industry, it has been proved conclusively that a five-day week produces a great deal more than a five-and-a-half day week.

  BUREAU OF CURRENT AFFAIRS (POSTER)
  Mr. Edenasked the Prime Minister, whether, in view of the complaints made against the Bureau of Current Affairs as a result of their issuing poster No. 26 of 26th April, 1947, which contained objectionable references to friendly governments and matter of a party political character, he is satisfied that, in future, under the new arrangements, authority will not be given by the Army Council to the publication of similar objectionable matter.
  The Prime Minister: I agree that the poster referred to by the right hon. Member should not have been issued for the purpose of compulsory education and I regret that it was. My right hon. Friend the Secretary of State for War has now given instructions that no material to be used for this purpose in the Army is to be acquired from the Bureau of Current Affairs unless it has previously been approved on his behalf. I hope that this arrangement will avoid any further cause for complaint.
  Mr. G. Lang: Will the Prime Minister bear in mind the inestimable services that this bureau has rendered [HON. MEMBERS: "Oh."] and also the fact that the criticisms are at least as frequent from the Left as from the Right?
  Mr. Speaker: We are only dealing with one poster, No. 26. We cannot deal with the whole question of policy.
  Major Legge-Bourke: Is the Prime Minister aware that this particular poster has also been exhibited in local food offices, and will he give some assurance that such posters as this will not be exhibited in offices run by His Majesty's Government?
  The Prime Minister: Obviously, that question should be put to my right hon. Friend the Minister of Food. I am not aware of it.
  Mr. Eden: Would the right hon. Gentleman be good enough to look into this? I am sure the Government cannot want propaganda of this kind to be issued in Government buildings. I am sure that the Prime Minister feels that. This is the first I have heard about food offices. Will the right hon. Gentleman consider that

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  all Government Departments should treat this matter equally and be responsible for the non-party character of publications they issue?
  The Prime Minister: I was not aware that this bureau was being used by the Food Ministry. As I understand it, this bureau was originally run by the War Office. At the end of the war it became a private firm and it has been utilised since by the War Office. Obviously, in utilising the productions of a private firm, there should be the very greatest care taken by Government Departments.
  Mr. Kenneth Lindsay: Is the Prime Minister aware that this is a voluntary body which has a contractual basis with many educational bodies, including three-quarters of the education authorities in this country; and is he also aware that for a whole year they have issued matter dealing with current affairs with growing approval and without any complaint? I agree that this matter was controversial but it is no disrespect to an organisation which is doing valuable work.
  The Prime Minister: I am only dealing with a particular instance of' where a Government Department has had certain matter sent to it which it used and which I think it ought not to have exhibited.
  Mr. Eden: Would the right hon. Gentleman endorse these words as a description of the view of public opinion on conscription:
  "Originally the force of Churchill tanks were lined up with the main Government armies against an opposition made up of Liberal Crusaders, together with a mixed force of Socialist moral rearmament and flamethrowers."

  FOOD SUPPLIES

    Rural Building Workers (Rations)
    Mr. Dribergasked the Minister of Food if he will make a statement on the provision of extra rations, mobile canteen facilities or packed meals for building-trade workers in rural districts.
    The Minister of Food (Mr. Strachey): Last December I asked local food officers to do everything in their power to help building employers, in both rural and urban areas, to provide packed meals or
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    canteens for their workers. This campaign has had considerable success, but, because of the practical difficulties, town and suburban workers have benefited most. I have decided, therefore, that from 20th July, when the new ration book comes into use, rural building workers who cannot be given canteens or packed meals shall be eligible for the special cheese ration and for the extra bread which goes with it.

    Sugar Allocation
    Mr. William Shepherdasked the Minister of Food whether in view of the indications of an improved sugar position, he will consider making allocations of sugar to office workers for tea making.
    Mr. Strachey: I am sorry, but the supply is not good enough for this at present.
    Mr. Shepherd: Is it not a fact that the stock position is good and that the international allocation is about to be increased; why should there be this discrimination between industrial workers and office workers? Is it because the latter are unorganised and are of the "tinker's cuss" variety?
    Mr. Strachey: I am glad to say that office workers are by no means completely unorganised.

    Pig-Killing (Conditional Licence)
    Squadron-Leader Donnerasked the Minister of Food whether he is aware that a food executive officer, in a letter to the proprietor of the Station Hotel, Basingstoke, states that he is not permitted to issue a licence to him to kill a pig unless a written undertaking is given that no part of it shall be used in connection with his catering establishment; under what authority the demand for such a written undertaking from the proprietor, as a condition precedent to the granting of such a licence, was made; and whether he will take the necessary steps to abolish this restriction.
    Mr. Strachey: Licences to slaughter a pig under the self-suppliers scheme are issued on my authority. For the past seven years it has been one of the requirements that a caterer must give an undertaking not to use any of the meat in any form for the purposes of his establishment. The restriction is made quite clear on the application form.
    Squadron-Leader Donner: If the proprietor of a catering establishment could feed his customers in this way, is it not grotesque to prevent it?
    Mr. Strachey: No, Sir. I think the dividing line must be drawn between the self-suppliers who do not produce for sale and those who are producing for sale or commerce in any form.
    Mr. Walkden: May I ask the right hon. Gentleman not to consider giving way on this point, because if he does, Lyons Bros, would be able to supply themselves with pork from their farms and really they would have good fun out of it?
    Mr. Hurd: If the Minister could not allow it in that case, certainly he could allow country hotels to become self-supporting so far as bacon is concerned?
    Mr. Strachey: No, Sir. An equal quantity of feeding stuffs would be subtracted from commercial producers.

    Agricultural Workers
    Mr. Thornton-Kemsleyasked the Minister of Food to whom, in connection with the issue of extra rations of cheese and bread, the description of workers not insured under the Agricultural Unemployment Insurance Scheme but engaged full time under contracts for work in agriculture refers.
    Mr. Strachey: These workers include groups of men employed under contract on such tasks as ditching, draining and reconditioning agricultural land; and also hedgers, thatchers and rabbit trappers working under contract.
    Mr. Thornton-Kemsley: Would it be possible for the Minister, by the exercise of a little sympathetic imagination, to include farmers' sons in this category provided they were working under contract for their fathers?
    Mr. Strachey: The definition is whether or not they are wage earners.

    Sub-office, St. Pancras
    Dr. Santo Jegerasked the Minister of Food why he was unable to arrange for the opening of a sub-office, as on previous occasions, for the distribution of the new ration books to people living at the southern end of South-East St. Pancras, who now have to go to Camden Town and wait in long queues.
    Mr. Strachey: The food executive officer decided that too few people used this sub-office last year to justify the extra staff needed there. She tells us that its absence has not led to long queues at the Camden Town centre or elsewhere in the Borough.

    Dutch Tomatoes (F.O.B. Price)
    Mr. Collinsasked the Minister of Food if he is aware that there is no upper limit to the f.o.b. price which can be remitted to shippers of Dutch tomatoes; that many wholesalers are paying to foreign producers prices considerably in excess of the permitted import price; and if he will institute a maximum f.o.b. price related to the import price or vary the present conditions governing the importation and distribution of tomatoes, so that they do not operate inequitably among different sections of traders and result in the expenditure of larger amounts of sterling.
    Mr. Strachey: I am grateful to my hon. Friend for raising this matter. It was always the intention that the price paid to the exporter for tomatoes should not exceed the appropriate import sale price prescribed in the Tomatoes Order. We have received reports that the relative provisions of the Control Orders are being circumvented and I therefore propose to make an Order which will have the effect my hon. Friend desires.

    Cabbages (Prices)
    Mr. Collinsasked the Minister of Food if he is aware that cabbage of the same quality, on a London wholesale market, varied in price per half bag of30 lbs. from 7s. 3d. per lb. on 12th June, 13s. 5d. per lb. on 13th June and 16s. 6d. per lb. on 14th June; that housewives were compelled to pay is. 6d. for a cabbage of inferior quality weighing two lbs.; if, in view of the considerable increase in supplies, he is satisfied that these prices are not unduly high; and whether he will take steps to reinstitute maximum prices and control price fluctuation.
    Mr. Strachey: Although supplies of all vegetables have improved and will I am glad to say, improve further, they are still much below normal for this time of year. I shall however take very careful account of the position when this

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    year's main crops become available, and if prices still remain at an unreasonable level in relation to this year's costs I shall have to reimpose price control.
    Mr. Collins: Will my right hon. Friend pay particular attention to the question of cabbages and other greenstuffs and keep the closest possible watch on the matter, because urgent action is necessary owing to the fluctuation in supplies?
    Mr. Strachey: Yes, Sir.

COLONIAL DEVELOPMENT (CORPORATION)
Mr. Creech Jones: The Government have been considering the means of developing Colonial resources. They consider that there is need for improved machinery for this purpose. The Colonial Development and Welfare Act provides money for the improvement of the social and other services of the Colonies and helps to provide the basic services for further economic development in the form of improved communications, better agricultural services, water supplies and the like. This has been, and is, very useful. But it is not enough. An instrument is also required whereby we can undertake individual productive projects likely to increase the wealth of the Colonies themselves and to stimulate the supply of products of which this country and the world at large stand in need.
The Government propose, therefore, to establish a Colonial Development Corporation with total borrowing powers of the order of £100 million. It will operate on commercial principles. Its object will bo to establish or assist any enterprise in the Colonies which is designed to increase their general productive capacity. No doubt these enterprises will be mainly agricultural but the Corporation will be able to undertake any enterprise which serves the general object. We propose that the Corporation should be given power to conduct enterprises itself or to set up subsidiary organisations to run individual projects or to give assistance to existing enterprises. The Corporation would undertake particular operations in any Colonial territory only with the consent of the Secretary of State and the Colonial Government concerned. The intention is that the Corporation and its
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subsidiaries should operate generally in close consultation with Colonial Governments, in order to ensure that their activities are conducted in the way best suited to promote the welfare of the Colonial peoples.
There would, of course, be no question of giving the Corporation any general monopoly in Colonial development. It is not intended to supplant private enterprise, but to supplement it. While the Government will continue their policy of encouraging public utilities and other suitable forms of public enterprise, they will also welcome private enterprise and investment in the Colonies so long as it is in harmony with the plans of Colonial Governments for social and economic development.
The Government propose to introduce legislation to establish the Colonial Development Corporation. It is proposed that the same legislation should provide for the establishment of the Corporation which is to take over the groundnut project established in East Africa by the Minister of Food. This would be a separate body from the main Colonial Development Corporation and provision would be made for it to undertake enterprises similar to the groundnut project over a wide field.
The two bodies would work in the closest liaison with one another.
Sir J. Mellor: May I ask the right hon. Gentleman to give an assurance that existing undertakings will not be impaired through the new development overtaxing the available resources of labour and materials?
Mr. Creech Jones: Indeed, they will not be prejudiced, they will be encouraged.
Mr. Stanley: While welcoming this valuable piece of new machinery, and, in particular, the Secretary of State's statement as to the important part to be played by private enterprise in Colonial development, may I ask him two questions? The first is: What does he mean when he says that these Corporations are to operate on commercial principles? Does it mean that they will operate on a profit-making basis? Secondly, is it necessary to maintain two Corporations in parallel, and would it not be much better, now that this new overall Corporation is to be

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set up, to wind up the Groundnut Corporation and transfer its work to the new body?
Mr. Creech Jones: With regard to commercial principles, obviously, the Development Corporation itself will have a number of undertakings which must be run on commercial lines and must pay their way, and, when it is said that they must run on commercial principles, what will possibly happen will be that what they "lose on the swings they will gain on the roundabouts," but we do not want the charge for any of this to fall on the Treasury. With regard to the second question, the Groundnut Corporation will cover a somewhat wider field than is conceived in the case of the Colonial Development Corporation, and it will be concerned primarily with foodstuffs, but the enterprise is of so large a character that a special utility Corporation is required in order that this work may be done.
Dr. Segal: Would my right hon. Friend give an assurance that the facilities afforded by the new Corporation will be extended equally to the Mandated territories, like Tanganyika?
Mr. Creech Jones: Certainly, under all the Colonial Welfare and Development Acts, the Mandated and trust territories are included.
Sir I. Fraser: Can the Secretary of State say if the High Commission territories of Bechuanaland, Basutoland and Swaziland, which were not covered, will be included in the new scheme?
Mr. Creech Jones: Certainly.
Mr. Thomas Reid: Will the new Corporation operate from London, or will there be sufficient scope for decentralisation, which is essential, in my opinion, in all these Colonial projects?
Mr. Creech Jones: Obviously, the head office must be in London, but the Corporation will "hive off," as it were, certain concerns and enterprises, and they undoubtedly will have their principal offices in the territories with which they are strictly concerned.
Squadron-Leader Donner: Is it the intention of the Government to introduce this legislation during this Session, and will the Sudan be included?
Mr. Creech Jones: I cannot answer with regard to the Sudan, because that is a special problem. As regards the time of legislation, that is a matter for my right hon. Friend the Leader of the House.
Mr. Sorensen: May I ask my right hon. Friend what relationship this Corporation will have to the various local Governments? Will they have any kind of control over the Corporation? May I also ask him if he will say something about Africans on the Board? Will the Board include Africans as well as Colonials and representatives from this country?
Mr. Creech Jones: It is altogether premature to discuss questions of personnel of the Board. That is a point which has not yet been considered by the Government.
Earl Winterton: In view of the tact that, in a number of these Colonies, there is a large and nominated official membership of the Legislative Assembly, who do not always see eye to eye with the elected Members, will the right hon. Gentleman devise machinery by which the elected Members of the Legislative Assembly, in Northern Rhodesia and elsewhere, may be able to present their case for or against any particular project to the right hon. Gentleman himself, in accordance with the principles of democracy?
Mr. Creech Jones: In the first place, in the last three years, the closest contacts have been developed, both through the Government and indirectly, with unofficial members of the Legislative Council and the Colonial Office and the Secretary of State. With regard to the point concerning consultation with Colonial Governments, obviously, the good will, understanding and consent of the Colonial Governments will be required in regard to any project in the territories for which they are responsible, and these projects, obviously, cannot proceed without the closest co-operation with the Corporation at all stages.
Dr. Haden Guest: While welcoming very cordially the extension of large-scale development, especially on a Socialist basis, may I ask my right hon. Friend whether he will provide a full opportunity, before legislation, for a Debate on this matter, because it raises the whole question of the condition of the African

443
people, which it is quite impossible to discuss by question and answer at the present time?
Mr. Creech Jones: I should say that the position of the African peoples will be adequately safeguarded under any proposals that are brought to the notice of this House. As regards the discussion on the Corporation proposals, when the legislation is introduced an opportunity will obviously be provided. In regard to a general discussion of production inside the Colonial Empire, there will be ample opportunity on the Supply Day.
Mr. Pickthorn: On that last point, since the right hon. Gentleman tells us that these undertakings are to pay their way, has he received an assurance from the Leader of the House that the House is to have an annual opportunity of debate to make sure how and to what extent they are paying their way, and without interfering with the normal Business of the House which, at any rate, does not have too much time; and can we have an assurance now that this is to come up for preliminary review on a special day of its own every year?
Mr. Creech Jones: In answer to the point raised with regard to the work of the Corporation, its finances, and the rest, an opportunity will be afforded on Supply
444
Day of the Colonial Office for a discussion, but, in any case, there is not the slightest doubt that when the Debate on the Bill itself comes along, the question of reports to the House with regard to the work of the Corporation can be considered.
Mr. Stephen: Will my right hon. Friend consider having the head office' of the Corporation in Glasgow?
Vice-Admiral Taylor: Can the right hon. Gentleman say whether assistance will be given to enable British shipping companies to undertake the transport of these goods from the Colonies, and to help the transport to be carried out by British ships?
Mr. Creech Jones: The whole problem of transport and communications is one to which a development corporation must give its attention. It is no good producing things if they cannot be brought away from a country.
Vice-Admiral Taylor: In British ships.
Mr. Speaker: We have not yet even started the Corporation.
Mr. Stokes: Will my right hon. Friend particularly call the attention of the Corporation to the value of the natural resources of the Dead Sea salts which, in 1923, were valued at no less than £240,000 million?

BUSINESS OF THE HOUSE
Motion made, and Question put,
"That the Proceedings on Government business be exempted, at this day's Sitting,
from the provisions of the Standing Order (Sittings of the house).—[Mr. H. Morrison.]
The House divided: Ayes, 282; Noes, 109.

Division No. 283.]

AYES.

[3.43 p.m.

Adams, W. T. (Hammersmith, South)

Foot, M. M.

McGhee, H G.

Alpass, J. H.

Fraser, T. (Hamilton)

Mack, J. D

Anderson, F. (Whitehaven)

Freeman, Peter (Newport)

McKay, J (Wallsend)

Attlee, Rt. Hon. C. R.

Gaitskell, H. T. N.

Mackay, R. W. G. (Hull, N.W.)

Austin, H. Lewis

Gallacher, W.

McKinlay, A S.

Awbery, S. S.

Ganley, Mrs. C. S.

Maclean, N (Govan)

Ayles, W. H.

George, Lady M. Lloyd (Anglesey)

McLeavy, F

Ayrton Gould, Mrs. B

Gibbins, J.

Macpherson, T. (Romford)

Bacon, Miss A

Gibson, C. W

Mainwaring, W. H.

Balfour, A.

Gilzean, A.

Mallalieu, J P W.

Barstow, P. G.

Glanville, J. E. (Consett)

Mann, Mrs. J.

Barton, C.

Gordon-Walker, P. C.

Manning, C. (Camberwell, N.)

Battley, J. R.

Greenwood, Rt. Hon. A. (Wakefield)

Manning, Mrs. L. (Epping)

Beattie, J. (Belfast, W.)

Greenwood, A. W. J. (Heywood)

Mathers, G.

Bechervaise, A. E.

Grenfell, D. R.

Medland, H. M

Belcher, J W

Grey, C. F.

Mellish, R. J

Benson, G

Grierson, E.

Middleton, Mrs. L

Perry, H.

Griffiths, D. (Rother Valley)

Mikardo, Ian

Beswick, F

Griffiths, W. D, (Moss Side)

Mitchison, G R

Binns, J

Guest, Dr. L. Haden

Monslow, W.

Blenkinsop, A.

Gunter, R. J.

Morgan, Dr. H. B.

Blyton, W. R.

Guy, W. H.

Morley, R.

Bottomley, A. G.

Haire, John E. (Wycombe)

Morris, Lt.-Col. H (Sheffield, C)

Bowden, Flg.-Offr. H. W.

Hale, Leslie

Morris, P (Swansea, W.)

Bowles, F. G. (Nuneaton)

Hall, W. .

Morris, Hopkin (Carmarthen)

Braddock, Mrs. E M. (L'pl. Exch'ge)

Hamilton, Lieut.-Col. R

Morrison, Rt. Hon H (Lewisham, E.)

Bramall, E. A.

Hardman, D R.

Moyle, A.

Brook, D (Halifax)

Hardy, E A.

Nally, W.

Brooks, T J. (Rothwell)

Harrison, J.

Naylor, T, E.

Brown, George (Belper)

Hastings, Dr. Somerville

Neal, H. (Claycross)

Brown, T. J. (Ince)

Henderson, A. (Kingswinford)

Nichol, Mrs M. E. (Bradford, N.)

Bruce, Maj. D. W. T.

Henderson, Joseph (Ardwick)

Nicholls, H. R. (Stratford)

Buchanan, G

Herbison, Miss M

Noel-Baker, Capt. F. E. (Brentford)

Burke, W A

Hewitson, Capt. M

Noel-Baker, Rt. Hon P J. (Derby)

Butler, H. W. (Hackney, S)

Hicks G.

Noel-Buxton, Lady

Carmichael, James

Hobson, C. R.

Oldfield, W H

Castle, Mrs B. A

Holman, P.

Oliver, G. H

Champion, A J.

Holmes, H. E. (Hemsworth)

Paget, R. T

Chetwynd, G. R

Hcuse, G

Paling, Rt. Hon. Wilfred (Wentworth)

Cluse, W S.

Hoy, J.

Paling, Will T (Dewsbury)

Cocks, F S

Hubbard, T.

Palmer, A. M. F.

Collindridge, F.

Hudson, J. H. (Ealing, W.)

Parker, J.

Collins, V. J.

Hughes, Hector (Aberdeen, N.)

Parkin, B. T

Colman, Miss G. M.

Hughes, H. D. (Wolverhampton, W.)

Paton, J. (Norwich)

Comyns, Dr L

Hynd, H. (Hackney, C.)

Pearson, A.

Corlett, Dr. J

Janner, B.

Peart, Thomas F.

Cove, W. G.

Jay, D. P. T.

Piratin, P.

Cunningham P

Jager, G. (Winchester)

Poole, Major Cecil (Lichfield)

Daggar, G

Jeger, Dr S. W (St. Pancras, S.E.)

Popplewell, E

Daines, P

John, W

Porter, G. (Leeds)

Davies, Clement (Montgomery)

Jones, Rt. Hon. A. C (Shipley)

Price, M. Philips

Davies, Edward (Burslem)

Jones, D T (Hartlepools)

Proctor, W. T

Davies, Ernest (Enfield)

Jones, P. Asterley (Hitchin)

Pryde, D. J,

Davies. Harold (Leek)

Keenan, W.

Randall, H E

Davies, Hadyn (St Pancras, S.W.)

Kendall, W. D

Ranger, J

Davies, R. J (Westhoughton)

King, E. M.

Rees-Williams D. R

Deer, G

Kinghorn, Sqn.-Ldr. E

Reeves, J,

de Freitas, Geoffrey

Kinley, J

Reid T (Swindon)

Delargy, H.

Kirby, B. V.

Rhodes, H

Diamond, J

Kirkwood, D

Roberts, Emrys (Merioneth)

Dodds, N. N

Lang, G.

Roberts, Goronwy (Caernarvonshire)

Driberg. T E. N

Lavers, S.

Robertson, J. J (Berwick)

Dugdale J (W Bromwich)

Lee, F (Hulme)

Rogers, G. H. R.

Dempleton, C W

Lee, Miss J (Cannock)

Ross, William (Kilmarnock)

Edelman, M

Leslie, J R.

Royle, C

Edwards, Rt Hon. Sir C (Bedwellty)

Levy, B W

Sargood, R

Edwards, W J (Whitechapel)

Lindgren, G, S

Scollan, T

Evans, E (Lowestoft)

Lindsay, K M. (Comb'd Eng. Univ.)

Scott-Elliot, W

Evans, John (Ogmore)

Lipson, D L.

Segal, Dr S.

Evans, S N (Wednesbury)

Lipton, Lt -Col M

Shackleton. E. A A

Ewart, R

Logan, D G

Sharp, Granville

Fairhurst, F

Longden, F.

Shinwell Rt Hon E

Farthing, W J

Lyne, A W.

Shurmer, P

Fernyhough E

McAdam, W.

Skeffington, A. M

Fletcher, E G. M, (Islington, E.)

McEntee, V. La T.

Skeffington-Lodge, T C

Skinnard, F. W.

Thomas, George (Cardiff)

Westwood, Rt. Hon. J

Smith, C. (Colchester)

Thomson, Rt. Hon. G R. (Ed'b'gh, E.)

White, H. (Derbyshire, N.E.)

Smith, H. N. (Nottingham, S.)

Thorneycroft, Harry (Clayton)

Whiteley, Rt. Hon. W.

Smith, S. H. (Hugh. S.W.)

Tiffany, S.

Wigg, Col. G. E.

Snow, Capt. J. W.

Timmons, J.

Wilkes, L.

Sorensen, R. W

Titterington. M. F.

Wilkins, W. A.

Sparks, J. A.

Tolley, L.

Willey, F. T. (Sunderland)

Stamford, W.

Vernon, Maj. W. t.

Willey, 0. G. (Cleveland)

Stephen, C.

Wadsworth, G

Williams, J. L. (Kelvingrove)

Stewart, Michael (Fulham, E.)

Walkden, E,

Williams, W. R. (Heston)

Stokes, R. R.

Walker, G. H

Willis, E.

Stress, Dr. B.

Wallace, G. D. (Chislehurst)

Wills, Mrs. E. A.

Summerskill, Dr. Edith

Wallace, H W. (Walthamstow, E.)

Wise, Major F. J.

Swingler, S.

Warbey, W. N.

Woodburn, A.

Symonds, A. L.

Watkins, T. E.

Young, Sir R. (Newton)

Taylor, H. B. (Mansfield)

Watson, W. M.

Younger, Hon. Kenneth

Taylor, R. J. (Morpeth)

Webb, M. (Bradford, C)

Zilliacus, K.

Taylor, Dr. S. (Barnet)

Weitzman, D.

Thomas, D. E. (Aberdare)

Wells P. L. (Faversham)

TELLERS FOR THE AYES:

Thomas, Ivor (Keighley)

West, D. G.

Mr. Simmons and Mr. Hannan.

NOES.

Amory, D. Heathcoat

Gridley, Sir A.

Noble, Comdr. A. H. P.

Anderson, Rt. Hn. Sir J. (Scot. Univ.)

Grimston, R. V.

Osborne, C.

Baldwin, A. E.

Hannon, Sir P. (Moseley)

Pickthorn, K.

Barlow, Sir J.

Hare, Hon. J H. (Woodbridge)

Prescott, Stanley

Baxter, A. B.

Haughton, S. G.

Price-White, Lt.-Col. D.

Beechman, N. A.

Head, Brig. A. H.

Reed, Sir S. (Aylesbury)

Birch, Nigel

Hogg, Hon. Q.

Reid, Rt. Hon. J. S C. (Hillhead)

Boles, Lt.-Col. D. C. (Wells)

Hudson, Rt. Hon. R. S. (Southport)

Roberts, H. (Handsworth)

Boothby, R.

Hurd, A

Roberts, Maj. P. G. (Ecclesall)

Boyd-Carpenter, J. A.

Hutchison, Lt.-Cm. Clark (E'b'rgh W.)

Robinson, Wing-Comdr Roland

Braithwaite, Lt.-Comdr. J. G.

Hutchison, Col. J. R. (Glasgow, C.)

Ropner, Col. L.

Buchan-Hepburn, P. G T.

Jarvis, Sir J

Ross Sir R. D. (Londonderry)

Bullock Capt. M.

Jeffreys, General Sir G

Savory, Prof. D. L.

Butcher, H. W

Keeling, E. H.

Scott, Lord W.

Channon, H.

Lancaster, Col. C. G

Shepherd, W. S. (Bucklow)

Clarke, Col. R. S.

Langford-Holt, J.

Smithers Sir W

Clifton-Brown, Lt.-Col. G.

Law, Rt. Hon. R. K

Spearman, A. C. M.

Conant, Maj, R. J. E.

Lennox-Boyd, A, T.

Spence, H. R.

Cooper-Key, E. M.

Lindsay, M. (Solihull)

Stanley, Rt. Hon O

Corbett, Lieut.-Col. U. (Ludlow)

Low, Brig. A. R. W.

Stoddart-Scott, Col M

Crosthwaite-Eyre, Col. O. E

MacAndrew, Col. Sir C

Studholme, H. G.

Crowder, Capt. John E

McCallum, Maj. D.

Sutcliffe, H.

Cuthbert, W. N.

Macdonald, Sir P (I. of Wight)

Taylor C. S. (Eastbourne)

Davidson, Viscountess

Mackeson, Brig. H. R.

Taylor, Vice-Adm. E A (P'dd'tn, S.)

Digby, S. W

McKie, J. H. (Galloway)

Thornton-Kemsley, C N

Dodds-Parker, A. D.

MacLeod, J.

Tcuche, G. C.

Donner, Sqn.-Ldr. P W

Macpherson, N. (Dumfries)

Vane, W. M. F.

Drayson, G. B.

Maitland, Comdr. J W.

Wakefield, Sir W. W.

Drewe, C.

Marlowe, A. A H.

Walker-Smith, D

Duncan, Rt. Hn. Sir A. (City of Lond.)

Marshall, D. (Bodmin)

Ward, Hon. G. R

Eccles, D. M.

Marshall, S. H (Sutton)

Webbe, Sir H. (Abbey)

Eden, Rt. Hon. A.

Medlicott, F.

Winterton, Rt. Hon Ear)

Elliot, Rt. Hon. Walter

Mencr, Sir J.

York, C.

Fleming, Sqn.-Ldr. E, L

Morris-Jones, Sir H.

Fraser, H. C. P. (Stone)

Morrison, Rt. Hon. W. S. (Cirencester)

TELLERS FOR THE NOES:

Fraser, Sir I (Lonsdale)

Mott-Radclyffe, C. E.

Major Ramsay and

Galbraith, Cmdr T. D

Neven-Spence, Sir B.

Lieut.-Colonel Thorp.

Grant, Lady

Nield, B. (Chester)

ORDERS OF THE DAY
  ELECTRICITY BILL
  As amended (in the Standing Committee), further considered.
  ELECTRICITY BILL

    CLAUSE 43.—(Supply of electricity to railways.)
    3.53 p.m.
    Colonel Clarke: I beg to move, in page 54, line 27, at the end, to insert:
    "but so however that taking one year with another the terms and conditions shall be such
    448
    as will not result in a financial loss to the Central Authority or the Area Board as the case may be."
    This Clause deals with the supply of electric current to railways which, we understand, are about to be nationalised, and I would like, first, to point out what is the present position. Under Section 4 of the Electricity (Supply) Act, 1935, which, of course, is to be repealed by this Bill, it is required that while bulk supplies of electricity from the Central Electricity Board to the railways may be given at special rates, such arrangements must comply with a rule, and that rule

    449
    is that they must not result in financial loss to the Central Electricity Board. This Amendment will ensure that that rule remains in force, even though the law is repealed. We feel that in future, in transactions between a nationalised electricity supply and a nationalised railway system, there may be temptation for an unsuccessful transport system to get a hidden subsidy from a successful electricity board. It is essential that the financial success or otherwise of all these nationalised undertakings should be clear to the country. It is not a matter of party politics. Under private enterprise, if a -company fails to act with financial prudence, and if it incurs financial losses, sooner or later it becomes bankrupt. That will not happen with a national monopoly. There is a danger that there will be continual internal financial bleeding, if I may so call it, which will result in the slow debility of the economic state of the country. The principle of this Amendment is already laid down in Section 4 of the Electricity (Supply) Act, 1935, which forbids the Central Electricity Board contracting a supply to any railway company unless they satisfy the electricity commissioners that such supply will not result in financial loss to the Board. I believe this Amendment is' necessary and will be helpful.
    Mr. Nigel Birch: I beg to second the Amendment.
    The Minister of Fuel and Power (Mr. Shinwell): I am unable to find any point of difference between the Opposition and myself on this issue. As I said during the Committee proceedings, it is not our intention to provide for subsidies, whether concealed or otherwise, but I thought this matter might be arranged by regulation rather than by making a specific stipulation in the Bill. However, as there appears to be no objection to the principle embodied in this Amendment and the succeeding Amendment, if hon. Members will leave the matter with me I will see whether I can find a suitable form of words and arrange the matter in another place. The right hon. Member for Southport (Mr. R. S. Hudson) will observe how anxious I am to make concessions at this early stage in our proceedings today, and no doubt he will respond by assisting me to expedite the proceedings.
    Mr. R. S. Hudson: We are obliged to the right hon. Gentleman. I do not think he can complain about the expedition with which we concluded our proceedings in the early hours of this morning. There is one question I would like to ask. There are three Amendments which, to some extent, overlap. They are, the Amendment which we are at present considering, and the Amendments in page 54, line 30, to leave out from "used," to end of line 34, and insert:
    "also for the lighting of vehicles, but shall not be used for any other purpose:
    Provided that, with the consent of the Electricity Commissioners, and subject to such limitations and conditions, if any, as they may prescribe either generally or in any particular case, the electricity supplied under this Section to a railway company at any point may be used partly for such purposes as aforesaid and partly for other purposes of the undertaking of the owners of the railway, being purposes for which such owners are entitled to use electricity, but the Electricity Commissioners shall not in any case give any such consent until notice of the application for the consent has been given by advertisement or otherwise in such manner as the Electricity Commissioners may direct, and an opportunity has been given to any person who appears to the Minister to be affected of making representations thereon";
    and in page 55, line 11, at end, insert:
    "(7) In exercising their functions under this Section the Minister and the Secretary of State shall ensure that Electricity Boards shall not supply electricity to any railway undertaking otherwise than upon terms and conditions designed to ensure that, taking one year with another, such supply shall not have the effect of subsidising the railway undertakings at the expense of other consumers, nor result in a financial loss to any Electricity Board."
    I think they all cover a variation of the same idea. I would like to know whether the assurance which the right hon. Gentleman has just given covers all three Amendments, or whether he would prefer to have a short discussion on the other two.
    Mr. Shinwell: What I said related to the Amendment which has been moved by the hon. and gallant Member for East Grinstead (Colonel Clarke) and the Amendment to page 55, line 11. The other Amendment, to page 54, line 30, is not so covered
    Mr. Hobson: In view of the Minister's statement that his remarks apply also to the Amendment in Page 55'line11 I feel constrained to make one or two observations. I do not

    451
    think it is sufficiently realised that while railway companies possess power stations which are not statutory undertakings, regulations have been made by the Electricity Commissioners with regard to the provision and financing of new turbine sets, whereby the frequency has been standardised at 50 cycles as against 33⅓ cycles, and a situation may arise whereby the railway companies can, and do, feed back to the grid. Therefore, it would appear that it might be of advantage to the area boards to give a specially reduced tariff in a given area in order to have a similar agreement with a railway generating station in another area. It is one of the difficulties which are bound to arise, because under the Bill we have excluded all statutory undertakings, irrespective of the fact that they are standardising with regard to frequency. Therefore, I think the Minister is limiting and committing himself to an agreement which, in certain circumstances, will be disadvantageous to the electricity consumer.
    Colonel Clarke: In view of the satisfactory assurance that the Minister has given, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    4.0' p.m.
    Sir Arnold Gridley: I beg to move, in page 54, line 30, to leave out from "used," to the end of line 34, and to insert:
    "also for the lighting of vehicles, but shall not be used for any other purpose:
    Provided that, with the consent of the Electricity Commissioners, and subject to such limitations and conditions, if any, as they may prescribe either generally or in any particular case, the electricity supplied under this section to a railway company at any point may be used partly for such purposes as aforesaid and partly for other purposes of the undertaking of the owners of the railway, being purposes for which such owners are entitled to use electricity, but the Electricity Commissioners shall not in any case give any such consent until notice of the application for the consent has been given by advertisement or otherwise in such manner as the Electricity Commissioners may direct, and an opportunity has been given to any person who appears to the Minister to be affected of making representations thereon."
    Subsection (3) applies to electricity supplied to any railway undertaking for the purpose of haulage or traction, and it states that a supply may be provided on the same' terms and conditions for any
    452
    other purpose. I wish to call attention to the width of those words
    "any other purpose."
    In the Standing Committee I pointed out this matter, but I was incorrectly reported in HANSARD as saying that the current might be supplied for 4d. per unit instead of 4d. The difference was in one of those "damned dots" that a famous statesman referred to, and that are capable of creating a great deal of misunderstanding. That price may be satisfactory for traction and haulage purposes, but if the railway undertakers are allowed to use electricity at the same price in their hotels, those hotels will be put into a position of undue preference in competition with thousands of other hotels in this country. That would be most unfair.
    It may be said that, under the existing regulations which permit the railways to use the supply for certain purposes, they already have power to use it in their hotels, but we are now dealing with a state of affairs which may shortly result in a great acceleration of railway electrification. We all hope that it might do so and that before many years are past most of the railways will be electrically operated. There will be a far greater number of railway hotels in that case which might be given an unduly cheap supply of electricity, if the provisions of the Subsection were allowed to stand. For that reason the first part of the Amendment proposes to leave out certain words. In order not to make the Subsection too restrictive we add a proviso which widens the possible use of the Clause. The wording of the proviso is precisely similar to the existing provisions of the Clause regarding railway supplies.
    I do not consider that the proviso is unreasonable in saying that if supplies are given by the Area Board at 4d. or 5d. per unit, that supply should be allowed to be used in such places as railway workshops, locomotive shops and shunting yards. I would not like to see any restriction of that kind, but that must be left for the suppliers of the current to agree about with the Central Board. In the absence of the Electricity Commission we have worded the proviso so as to leave the position very much as it is to-day. If the Commission are to go, there ought to be some other means of referring provisions to some body which would be able to settle any difference of view as to the

    453
    terms and conditions upon which electricity would be supplied for traction purposes, and for any other purpose.
    Mr. Bowles: When the hon. Gentleman was referring to the report of his speech in HANSARD, I think he talked about some Labour leader who had spoken about "damned dots."
    Lieut.-Colonel Elliot: I think my hon. Friend said "an English statesman."
    Mr. Bowles: I thought he said a Labour statesman.
    Colonel Clarke: I beg to second the Amendment.
    Mr. Hobson: The Amendment would make the situation worse than it is at the moment for traction and lighting. What about the current required for heating and the compressing of brakes? Is it to be measured? Are we to have regulations on such matters as that? When the hon. Member was dealing with special tariff for hotels he qualified it in relation to the provision of electrical energy for railway workshops. Railways already have current there on similar terms as for traction. If we are to make regulations every time, those who profess an abhorrence for regulations, will find the industry saddled with a lot of red tape. So far as special terms are concerned, they are common at all times. It is unfair to read into the Bill that railway hotels are to have some kind of preferential tariff.
    Sir A. Gridley: I do not think that the hon. Gentleman can have read the proviso, which leaves it open for the current to be used partly
    "for such purposes as aforesaid"
    and partly
    "for other purposes of the undertaking."
    The Solicitor-General (Sir Frank Soskice): In view of the assurance which my right hon. Friend gave a few moments ago I think the hon. Gentleman who moved the Amendment will agree that some, at any rate, of the point of the Amendment is taken away. What remains really is that he would seek to substitute by the Amendment, and in particular by the proviso, the consent of the Electricity Commissioners for the consent of the Central Authority. If the supply is to be used for any other purpose than haulage and traction Subsection (3) lays down that
    454
    it must be with the approval of the Central Authority. The hon. Gentleman would say that for "central authority" must be substituted "Electricity Commissioners." That is the effect of the proviso. I agree that it also sets up certain machinery. The long and the short of it is that the hon. Gentleman seeks to change one consenting authority for another. I would join issue with him on that proposal, but before I give reasons for doing so I would say that we think that the words
    "on the same terms and conditions"
    should be reconsidered. Both the hon. Gentleman and my hon. Friend, impliedly in what they said, pointed out the restrictive character of those words. We want to look at those words to see whether we cannot give the Central Authority some more discretion with regard to the terms and conditions which it authorises. That, I think, would meet the point made by my hon. Friend.
    With regard to the question whether it should be the Central Authority or the Electricity Commissioners, we feel that we must adhere to the position we have taken up. After all, what are the circumstances? The circumstances are that the Central Authority has imposed upon it, under Clause I (1, c) the duty of coordinating the distribution of electricity by area boards, and exercising a general control. Surely, this matter is one which falls plumb within the scope of that duty? Secondly, it is also under a duty, by Clause 1 (6, c), of avoiding any undue preference. My right hon. Friend has said that he does not intend that there should be anything in the nature of a secret subsidy to railways. In addition to that, then, the Central Authority is under a specific duty to see that there is no undue preference shown to any particular type of consumer. Railway companies using current for purposes other than haulage and traction would come within the scope of that provision. Therefore, we think that the appropriate authority in whom to vest the power of giving or refusing consent, or specifying the terms upon which the current may be used for other than haulage or traction purposes, should be, as it is now under the Bill, the Central Authority.
    It is, I think, relevant to remember what has been said earlier in cur discussions on this Bill on the question of financing. We are no longer dealing, or

    455
    will no longer be dealing when this Bill becomes law, with the position in which one has a number of separate undertakers, each watching out, quite naturally, in order to preserve its own area. We have substituted the area boards; and we have substituted for the principle of individual undertakers the overriding principle that what we are really striving at is to improve the sufficiency of supply to consumers. That is a change; and that does, of course, take away a good deal of the reason for the provisions which the hon. Member for Stockport (Sir A. Gridley) has embodied in this Amendment, and which previously found their place in Section 4 {2) of the Electricity Supply Act, 1935. I would say, in passing, that the hon Member for Stockport was not quite accurate in saying that the wording of that Section was identical with the wording of this Amendment. There is a noticeable difference. Section 4 of that Act prescribed the Minister of Transport as the person who should give consent. The hon. Member has substituted the Electricity Commissioners. However, that is by the way.
    As has already been said during our Debates, it is not necessarily thought that the area boards should run, year in and year out, without' any loss, so long as the overall undertaking which is under the control of the Central Authority, taking an overall view of it, balances its budget. Therefore, a good deel of the reason which made it necessary, under Section 4 of the 1935 Act, to set up the rather elaborate machinery which was there set up, has gone. In substituting the Central Authority, charged with the duties in Clause I to which I have referred—that is to say, the duty of exercising an overall co-ordinating control, and the duty of seeing that there is no undue preference extended to any particular consumer—as the authority which is to have the power of giving or refusing consent to the supply of current being used for other than haulage and traction purposes, we feel we have taken the right course.
    Therefore, in so far as the Amendment seeks to substitute the Electricity Commissioners for that Authority, we must ask the House to reject the Amendment. But, as I said earlier, we might be able to reconsider the words "on the same
    456
    terms and conditions," to meet partly the point made by the hon. Member for Stockport and partly the point made by my hon. Friend, that there should perhaps be some more flexibility, more scope for discretion in the terms upon which the Central Authority could give or withhold its consent to the user by railway companies of current for other than haulage and traction purposes. That is, however, set against the background that my right hon. Friend has said, which has to be considered, that there must be no hidden subsidy veiled in the terms upon which railway companies are allowed to avail themselves of electricity.
    4.15 p.m.
    Sir A. Gridley: With the consent of the House, perhaps I might put a question to the learned Solicitor-General. I did not, of course, pretend that the Central Authority should decide the terms upon which the railway companies should get their current. If I understand Clause 43(I) correctly, is it not the fact that the Central Authority itself has the duty of providing these supplies to railway undertakings? If that be so—and I think it is—they are to be the suppliers. Surely, they cannot then state the terms of the supply? If there should be any difference between them and the railway undertakings there must be some means of referring the difference to arbitration. It is quite true that in Subsection (2) the terms and conditions for haulage and traction purposes are to be determined by regulations made by the Minister and the Minister of Transport jointly. But, with all respect to those two Ministers, I doubt very much whether they know a sufficient amount about the cost of producing and distributing electricity to be able to decide what are the proper terms to be agreed between them, and I should be very sorry if the two Ministers differed because of that. The point of my question is: Is it not the fact that the Central Authority is responsible for supplying current to railways? That being so, surely they should not be able to decide what the terms should be.
    Colonel Clarke Colonel Clarke rose—
    Mr. Speaker: The hon. and gallant Member cannot now speak. He has forfeited his right by seconding the Amendment.
    Amendment negatived.

    CLAUSE 44.—(Use of heat from generating stations.)
    The Solicitor-General: I beg to move, in page 55, line 40, after "manner," to insert:
    "and subject to 'the like provisions and restrictions."
    This is little more than a drafting Amendment. It makes clear that in using power to provide heat from generating stations to be used for buildings, and so on, the boards are to be subject to the same limitations in the exercise of their power as they are for the supply of electricity. For example, they would be bound, as a result of this Amendment, by the provisions of Section 14 of the Electric Lighting (Clauses) Act, 1899, which, provides for certain notices to be given to the Postmaster-General when streets are broken up.
    Amendment agreed to.

    CLAUSE 45.—(Power to break up streets for certain purposes.)
    The Solicitor-General: I beg to move, in page 56, line 22, at the end, to insert:
    "(2) The powers conferred by this Section shall be exercisable in like manner and subject to the like provisions and restrictions as they are exercisable by the Board concerned for the purpose of the supply of electricity in the area or District of the Board."
    This does almost exactly the same as the last Amendment, except that it relates to the case where a board is providing a supply of electricity outside its area. It is to be bound in relation to its activities outside its area in exactly the same way as it would be bound in relation to its activities inside the area.
    Amendment agreed to.

    CLAUSE 47.—(Machinery for settling terms and ''conditions of employment of staff, etc.)
    Mr. Boyd-Carpenter: I beg to move, in page 57, line 6, at the end, to insert:
    "(2) In carrying out their duties under the last preceding Subsection, the Central Authority shall not refuse to consult with any organisation appearing to represent an appreciable proportion of persons employed by Electricity Boards, or of any class of such persons."
    This Amendment seeks to add a new Subsection to Clause 47, which deals generally with the relations between the electricity authorities and their staffs. As
    458
    the Bill stands, it is laid down, in Subsection (1), that
    "it shall be the duty of the Central Authority to seek consultation with any organisation appearing to them to be appropriate with a view to the conclusion between the Authority and that organisation of such agreements as appear to the parties to be desirable."
    That is extraordinarily little, because unless an organisation appears to the Central Authority to be appropriate, there is no obligation of any kind upon the Authority to enter into negotiations with them. This Amendment seeks to provide that where an appreciable proportion of persons employed by the boards, or an appreciable proportion of a class of persons employed by the boards, are organised in any particular organisation, it shall be the duty of the Central Authority to discuss and negotiate with them on wages and conditions, and so forth. This is considered desirable because of the situations which have developed in other nationalised and semi-nationalised industries. The hon. Member for Reading (Mr. Mikardo), the day before yesterday, took the line, on an Amendment moved from this side of the House, that it was unnecessary because it sought to deal with a danger which had not yet arisen. That cannot be urged against this Amendment, because this Amendment is designed to prevent the Central Electricity Authority following the example of the Coal Board, by refusing to negotiate with organisations among its employees.
    In the case of the Coal Board, as the right hon. Gentleman is only too well aware, he has had, until this morning, a strike on his hands, solely by reason of the refusal of the Coal Board to recognise and discuss conditions with the Administrative and Clerical Workers' Union. The right hon. Gentleman is also well aware of the potentially dangerous situation which is developing by reason of the Coal Board's refusal to recognise and negotiate with the British Association of Colliery Officials and Staff. It is precisely to prevent that same sort of situation developing in this industry that this Amendment has been brought forward. Not only has this situation arisen in the coal industry, but the potentialities of it arising in the electricity industry are even greater.
    Mr. Hobson: Can the hon. Member name one organisation of workers or tech-

    459
    nicians that has not been recognised by the conciliation machinery which already exists in the electricity undertakings?
    Mr. Boyd-Carpenter: The hon. Member is dealing with the present position when the industry is under private enterprise. This Amendment is not designed to deal with that situation, which this Bill seeks to bring to an end. I am inclined to agree with the hon. Member that the situation has not become so bad under private enterprise to warrant this precaution being taken. The object of this Amendment is to deal with the situation when the Central Electricity Authority and its satellite boards are set up. A fair standard to apply is not that of private enterprise, but that of the public monopolies, and, in particular, the public monopoly which comes directly under the responsibilities of the right hon. Gentleman the Minister of Fuel and Power.
    I do not know whether the right hon. Gentleman proposes to follow what he did in the case of the coal industry, by putting on this authority representatives associated with the major unions. If he does, he will appreciate that, with the best will in the world, a man who has spent the whole of his life in building up a particular union is not likely to regard the claims of another union very sympathetically. That has certainly been the experience of those unions which are rivals to the National Union of Mine-workers, when having to deal with Mr. Ebby Edwards of the National Coal Board. If it is the intention of the Minister to direct the Central Electricity Authority to continue the happy state of affairs which has existed in the industry under private enterprise, he can have no conceivable objection to accepting this Amendment, because it will only write into the Bill what are precisely his intentions. It is only if that state of affairs, which the hon. Member for North Wembley (Mr. Hobson) has so rightly praised, is brought to an end, that the provisions of this Amendment will take effect. If the hon. Member wants this state of affairs to continue, he can safeguard that by supporting this Amendment.
    This Amendment seeks to prevent what is unfortunately happening in the coal industry. It is not a case of any vague or general apprehensions, but a case of very precise apprehensions, based on what
    460
    has happened in a neighbouring industry. In the case of electricity, it is even more important to provide this safeguard, owing to the wide variety of unions involved. For example, this Bill provides for the taking over of local authority undertakings. As the hon. Member for North Wembley knows perfectly well, many of the staffs of the local authority undertakings are members of a union connected with local government, rather than of a union connected with the industry. This includes members of the National Association of Local Government Officers, who are very apprehensive about their position in the industry. It lies within the power of the right hon. Gentleman to quieten these apprehensions by accepting this Amendment, and it lies within his power to start off this great experiment in an atmosphere of suspicion and intrigue by refusing to accept it, in which case he will leave us in the unfortunate position of having a repetition of the coal scandal.
    Major Peter Roberts: I beg to second the Amendment.
    Hon. Members who keep harking back to the labour relations as they have been., should remember that an entirely new principle of nationalisation is being introduced. This is a State monopoly of labour, and where there is a State monopoly of labour the position is entirely different and it is the duty of this House to safeguard all sections. We remember that during the coal Debate this same point was put to the Minister on two or three occasions, but he steadfastly refused to meet us. We are now seeing some of the consequences in other industries. If he persists in his attitude, it will only lead to troubles arising in this industry as in the coal industry.
    4.30 p.m.
    Mr. Shinwell: If the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) knew anything about the subject of trade union organisation he would never have made a speech to which we have just listened. But, as we know,
    "A little learning is a dangerous thing."
    and that is well illustrated by the hon. Gentleman's speech. The fact is that there is a recognised practice for the purpose of negotiation in the electricity supply industry. What is more, it works very well.
    Sir A. Gridley: It works very well today.
    Mr. Shinwell: The hon. Member for Stockport (Sir A. Gridley), whose knowledge of electricity supply exceeds by far that possessed by the hon. Member for Kingston-upon-Thames, has just said that it works very well today. Well, if that is so, why disturb it by allowing the creation of a large number of splinter organisations, some of which may be promoted by malicious persons with sinister designs on the new electricity dispensation? The hon. Member for Kingston-upon-Thames said that he was a little surprised—not for the first time, I should imagine—by the words in the Clause, "appear to them," meaning to the Central Authority. I do not know to whom else it would appear, but the body responsible for conducting negotiations on one side. Certainly, it would be highly improper to leave the matter with whom the Central Authority should negotiate to an outside body. That would make confusion worse confounded. What is proposed in the Amendment? It is that we should follow the line laid down in the Coal Industry (Nationalisation) Act, with the exception of the insertion of the word "appreciable" in place of "substantial." That makes a world of difference. I would like someone to define for me what is meant by "appreciable." It might represent a company organisation, or half a dozen persons employed in the industry who decided suddenly, out of the void, for a reason that could not be explained, to create an organisation and then present an ultimatum to the Central Authority. We could not have sabotage of that kind operating under nationalisation, and I do not intend that it should.
    Let me summarise the nature of the organisations which prevail in the industry. About 95 per cent. of the technical and manual workers are covered by the following trade unions, which are representative bodies. There is the Electrical Power Engineers' Association, a body which represents the technicians, and rightly so. Their point of view must be considered. There is the Electrical Trades Union. What is wrong with that? It is a recognised organisation. Then there are the Amalgamated Engineering Union, the National Union of Enginemen
    462
    and Firemen, the National Union of General and Municipal Workers, and the Transport and General Workers Union. All these are well known and representative trade union organisations. Is it necessary to promote any other kind of organisation than these representative bodies, which are operating on behalf of employees in the industry? I think not. There is, of course, the position of the clerical workers, and that will have to be the subject of negotiation between the parties concerned, including N.A.L.G.O. I would not exclude representations from a representative body of that kind, which is, indeed, a bona fide organisation. That makes a substantial difference.
    Reference was made by the hon. Member for Kingston-upon-Thames to little difficulties which have developed in the mining industry. These are no new difficulties. They have existed as long back as I can remember. Groups of persons came together, promoted an organisation, and then sought recognition. While I agree that the minority interest cannot be ignored, either in industry or elsewhere—and to prevent any misunderstanding I say that we have done that by making concessions in this Bill— yet, at the same time, a body which is responsible, for the administration of a great industry or service must have regard to the existence of the largest organisations in the industry which can lay greater claim to speak on behalf of employees than little splinter, infinitesimal, and maybe pettifogging organisations. If difficulties should emerge, and some may from time to time, I leave them to the good sense and high intelligence of the persons I shall appoint after consultation with representative bodies of the organisations in the industry. I have a feeling that they will make a far better job of it than the hon. Member for Kingston-upon-Thames would do if we entrusted the task to him. I ask the House to reject the Amendment.
    Mr. R. S. Hudson: The right hon. Gentleman made an appeal earlier today for us to co-operate in expediting procedure on this Bill. He will not expedite procedure if he continues to make speeches of the type he has just made.
    Mr. Tiffany: The right hon. Gentleman's side wants to make them all, but take none from this side.
    Mr. Hudson: If the Minister trails his coat as he did just now he will get it trodden on, and more time will be taken up in discussing Amendments. The right hon. Gentleman's speech is a typical example of the way in which his mind works. He professes respect for democracy and for the rights of minorities, yet he clearly shows that his idea of free speech is free speech for the majority and prevention of the minority for making its view heard, excepting in so far as he chooses to allow it. The right hon. Gentleman talked about the way in which the Government had respected the rights of minorities in this House. We have had last week and this week, quite apart from the proceedings on other Bills, an example of the way in which he translates that into practice. The Leader of the House admitted, in his absence, that the way the Minister treated this House over the Report stage of this Bill, through his delay in putting down Clauses, was a gross discourtesy not only to the Opposition, but to the House itself, and to you, Mr. Speaker.
    I take the strongest exception to the right hon. Gentleman getting up in the middle of a discussion on an Amendment which was being argued reasonably from these benches, and talking in the way he did. Why should the right hon. Gentleman arrogate to himself the right to say, in respect of my hon. Friend the Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) that
    "A little learning is a dangerous thing?"
    During the proceedings on this Bill, both here and upstairs, who has displayed an absence of knowledge of these matters more than the right hon. Gentleman? Look at the number of mistakes in the Bill as originally presented which, as a result of scrutiny by us, with our limited resources, the right hon. Gentleman has had to come to the House to put right. More are to be discussed today. The right hon. Gentleman has Clauses on the Order Paper, which we are to discuss later, which show that he had not the foggiest idea of the complications and problems which would arise when this Bill was originally presented. It is not going to expedite proceedings when the right hon. Gentleman talks in this way, and I would recommend him to mend his ways and exercise a little more courtesy.
    Mr. Harold Roberts: I listened with great interest to the speech of the Minister. I think that for the purposes of our discussion one may assume that in his knowledge of these matters he is intellectually superior to the hon. Members who have addressed the House. One may even assume a kind of apostolic succession by means of which those whom he is to call into being—those whom he says "I shall appoint "—will have the same preeminent intellectual powers and knowledge that he has. But the matter really goes rather deeper than the Minister would lead us to think. My knowledge of these matters would not in any way approach that of the Minister, but it was my privilege for several years to be chairman of a joint industrial council in the West Midlands. The trade union side was pretty well represented, but one had the problem that a number of employees desired to be represented by another union. There was a great deal of ill-feeling. That compelled me to think the matter out, and to realise that joint boards, like everything else in human life, may become rigid and ossified.
    4.45 p.m.
    I came to two conclusions: First that the fundamental right of negotiation on the part of man and his master carries with it the corollary that men must be free to choose their own representatives. Secondly, I came to the conclusion that not without grave impertinence on the part of the employers could they dictate to the other side who should represent them on the J.I.C. Thirdly, I urged the employees' side of the council to enlarge their representation, so that it might fully represent all the employees. I am pleased to say that they met the matter in that broadminded way. It meant criticism and ill-feeling between different unions, but the smaller unions obtained representation, and have gone along very happily since. It is all very well to speak about unions being promoted for sinister reasons—petty little unions, and so forth. That is always the language of the large concerns—the vested interest; the language of the large unions against the small ones. I have heard it many times. When I find an Amendment moved which is designed to ensure that the employing authority shall negotiate with all the people who can have any reasonable claims to negotiate, I deny that it should be dealt

    465
    with in the manner in which the Minister is attempting to deal with it this afternoon
    Mr. Pickthorn: I should like to remind the Minister of another analogy, which I think he might not unreasonably take into account. The difficulties and mischief which are feared on this side of the House are not something hypothetical or something that has never happened before. They do occur where you get Governmental influence or control over all or most of a particular kind of activity; it does occur—and I am sure that the right hon. Gentleman who is in charge of the Ministry of Education will confirm mc on consultation that it does occur there—that for want of representation of some associations there are discontents and that arises from a machinery necessarily exclusive where excessive deference is paid to the administrative convenience of dealing, if possible, with
    one organisation only or at any rate, with a few large organisations; the mischief arises particularly when it comes to matters of fixing salary and remuneration as in the Burnham Committees, and so forth. Considerable harm does result, and very great harm is felt to result; we are very often told from the other side when things of this sort are discussed, that it all boils down in the end to the human problem, the problem of human relations; and if they really want this kind of legislation to be a success they really must not take what seems to be at first sight the simple easy administrative line because the doubts and frictions thus set up will ruin their pet projects in a not very long run.
    Question put, "That those words be there inserted"
    The House divided: Ayes, 112; Noes, 271

    Division No. 284.]

    AYES

    [4.45 p.m.

    Amory, D. Heathcoat

    Grimston, R. V.

    Noble, Comdr A. H. P

    Assheton, Rt. Hon. R

    Hannon, Sir P. (Moseley)

    Csborne, C

    Baldwin, A. E

    Hare, Hon J H (Woodbridge)

    Peto, Brig C. H. M.

    Barlow, Sir J

    Haughton, S. G

    Pickthorn, K.

    Baxter, A. B.

    Head, Brig A. H

    Ponsonby, Col. C. E.

    Beechman, N. A

    Headlam, Lieut.-Col Rt. Hon. Sir C

    Price-White, Lt.-Col D.

    Bennett, Sir P

    Hollis, M. C

    Raikes, H V

    Boles, Lt.-Col, D. C. (Wells)

    Hudson, Rt. Hon. R. S (Southport)

    Ramsay, Maj. S

    Bossom, A. C

    Hurd, A.

    Reed, Sir S (Aylesbury)

    Bower, N

    Hutchison, Lt.-Cm. Clark (E'b'rgh W.)

    Reid, Rt Hon. J S. C. (Hillhead)

    Boyd-Carpenter, J. A.

    Jarvis, Sir G

    Roberts, H (Handsworth)

    Braithwaite, Lt.-Comdr. J. G.

    Jeffreys, General Sir G

    Roberts, Maj. P G (Ecclesalt)

    Bromley-Davenport, Lt.-Col W

    Keeling, EH

    Robinson, Wing-Comdr Roland

    Buchan-Hepburn, P G T

    Lancaster, Col. C. G

    Ropner, Col L

    Bullock, Capt M

    LaW, Rt Hon R K

    Ross, Sir R D. (Londonderry)

    Butcher, H W

    Legge-Bourke, Maj E. A. H

    Savory, Prof. D L.

    Clarke, Col. R. S

    Lindsay, M (Solihull)

    Scott, Loro W.

    Clifton-Brown, Lt.-Col. G

    Low, Brig A. R. W

    Smiles, Lt.-Col. Sir W

    Cooper-Key, E M

    MacAndrew, Col. Sir C

    Smith, E P (Ashford)

    Crosthwaite-Eyre, Col. O E

    McCallum, Maj. D

    Smithers Sir W

    Crowder, Capt. John E

    Macdonald, Sir P (I of Wight)

    Spearman, A. C M

    Cuthbert, W. N

    Mackeson, Brig. H. R.

    Spence, H R.

    Davidson, Viscountes

    McKie, J H. (Galloway)

    Stanley, Rt Hon. O

    Digby, S. W

    Maclay, Hon J. S

    Stewart, J Henderson (Fife, E.)

    Dodds-Parker, A. D.

    MacLeod, J

    Stoddart-Scott, Col M

    Donner Sqn.-Ldr. P W

    Macpherson, N (Dumfries)

    Studholme, H G

    Sucliffe, H

    Drayson, G. B

    Maitland, Comdr. J. W.

    Taylor C. S (Eastbourne)

    Drewe, C.

    Manningham-Buller, R. E

    Taylor Vice-Adm E A. (P'dd't'n, S.)

    Duncan, Rt. Hn Sir A (City of Lond)

    Marlowe, A A H

    Thornton-Kemslev C. N

    Eccles, D. M.

    Marshall, D (Bodmin)

    Tcuche, G. C

    Eden, Rt Hon. A.

    Marshall, S. H (Sutton)

    Wakefield, Sir W. W

    Elliot, Rt. Hon. Walter

    Medlicott, F

    Ward, Hon. G. R

    Fleming, Sqn.-Ldr, E L

    Mellor, Sir J

    Webbe, Sir H (Abbey)

    Fraser, H C. P (Stone)

    Morris-Jones, Sir H

    Winterton, Rt Hon Earl

    Galbraith, Cmdr T. D

    Morrison, Rt Hon. W S. (Cirencester)

    York, C

    George, Maj. Rt. Hn. G Lloyd (P'ke)

    Mott-Radclyffe, C. E.

    Grant, Lady

    Neven-Spence, Sir B

    TELLERS FOR THE AYES:

    Gridley, Sir A

    Nield, B. (Chester)

    Major Conant and

    Lieut.-Coroner Thorp.

    NOES.

    Adams, Richard (Batham)

    Ayles, W. H.

    Barton, C.

    Adams, W T. (Hammersmith, South)

    Ayrton Gould, Mrs. B

    Battley, J. R.

    Alpass, J. H

    Bacon, Miss A

    Bechervaise. A E.

    Anderson, F. (Whitehaven)

    Balfour, A.

    Benson, G.

    Austin, H. Lewis

    Barnes, Rt Hon A. J

    Berry, H.

    Awbery, S S.

    Barstow, P. G.

    Beswick, F

    Blyton, W. R.

    Holman, P

    Proctor, W. T

    Bottomley, A. G.

    Holmes, H E. (Hemsworth)

    Pryde, D J

    Bowles, F. G (Nuneaton)

    Hoy, J.

    Pursey, Cmdr. H.

    Braddock, Mrs E M. (L'pl. Exch'ge)

    Hubbard, I

    Randall, H E

    Braddock, T. (Mitcham)

    Hudson, J. H. (Ealing, W.)

    Ranger, J.

    Brook, D. (Halifax)

    Hughes., Hector (Aberdeen, N.)

    Rees-Williams, D. k

    Brooks, T J. (Rothwell)

    Hughes, H. J (Wolverhampton, W.)

    Reeves, J.

    Brown, T. J. (Ince)

    Hynd, H. (Hackney, C.)

    Reid T (Swindon)

    Bruce, Maj. D. W T.

    Janner, B.

    Rhodes, H

    Buchanan, G.

    Jay, D. P T

    Ridealgh, Mrs. M.

    Butler, H. W. (Hackney, S)

    Jeger, G (Winchester)

    Roberts, Emrys (Merioneth)

    Callaghan, James

    Jeger, Dr. S. W (St. Pancras, S.E.)

    Roberts, Goronwy (Caernarvonshire)

    Carmichael, James

    John, W

    Robertson, J. J (Berwick)

    Castle, Mrs. B. A.

    Jones, Rt. Hon. A. C. (Shipley)

    Rogers, G. H. R

    Chamberlain, R. A

    Jones, D T. (Hartlepools)

    Ross, William (Kilmarnock)

    Champion, A J.

    Jones, P Asterley (Hitchin)

    Royle, C.

    Chetwynd, G. R.

    Keenan, W.

    Sargood, R.

    Cluse, W. S.

    Kendall, W. D.

    Scollan, T.

    Cobb, F. A.

    King, E M.

    Scott-Elliot, W.

    Cocks, F. S.

    Kinghorn, Sqn.-Ldr. E.

    Segal, Dr S.

    Shackleton, E. A. A

    Collindridge, F.

    Kinley, J.

    Sharp, Granville

    Collins, V. J.

    Kirby, B V.

    Shinwell Rt Hon. E

    Colman, Miss G. M

    Kirkwood. D.

    Shurmer, P.

    Comyns, Dr. L.

    Lavers, S

    sImmons, C. J.

    Corlett, Dr. J.

    Lee, F. (Hulme)

    Skeffington, A. M.

    Cove, W. G.

    Lee, Miss J (Cannock)

    Skeffington-Lodge, T. C

    Crawley, A.

    Leslie, J R.

    Skinnard, F. W

    Daggar, G.

    Levy, B. W

    Smith, C. (Colchester)

    Davies, Edward (Burslem)

    Lewis, A. W J. (Upton)

    Smith, H. N. (Nottingham, S.)

    Da vies Ernest (Enfield)

    Lipson, D. L

    Smith, S. H. (Hull S.W.)

    Davies, Harold (Leek)

    Lipton. Lt Col. M

    Snow, Capt. J W

    Davies, Hadyn (St Pancras, S.W.)

    Logan, D G

    Solley, L. J

    Davies, R. J (Westhoughton)

    Longden, F.

    Sorensen, R. W

    Davies, S. O (Merthyr)

    Lyne, A W

    Soskice, Maj. Sir F

    Deer, G.

    McAdam, W.

    Sparks, J. A.

    de Freitas, Geoffrey

    McEntee, V. La T.

    Stamford, W.

    Delargy, H. J.

    McGhee, H. G

    Stephen, C.

    Dodds, N N.

    Mack, J D.

    Stokes, R. R,

    Driberg, T E. N.

    McKay, J (Wallsend)

    Stross, Dr. B.

    Dugdale, J (W. Bromwich)

    Mackay. R. W. G. (Hull, N.W.)

    Stubbs, A. E.

    Dumpleton, C W.

    McKinlay, A. S.

    Summerskill, Dr. Edith

    Edelman, M.

    Maclean, N (Govan)

    Swingler, S.

    Edwards, Rt Hon. Sir C. (Bedwellty)

    McLeavy, F

    Sylvester, G. O.

    Evans, E. (Lowestoft)

    McNeil, Rt Hon. H

    Symonds A. L.

    Evans, John (Ogmore)

    Macpherson, T. (Romford)

    Taylor, H. B. (Mansfield)

    Evans, S. N. (Wednesbury)

    Mainwaring, W H

    Taylor, R, J (Morpeth)

    Ewart, R.

    Mallalieu, J. P. W.

    Taylor, Dr. S. (Barnet)

    Fairhurst, F.

    Mann, Mrs. J.

    Thomas, D. E (Aberdare)

    Farthing, W. J.

    Manning, C (Camberwell, N.)

    Thomas, Ivor (Keighley)

    Fernyhough, E.

    Manning, Mrs. L. (Epping)

    Thomas, George (Cardiff)

    Foot, M M

    Mathers, G

    Thomson, Rt. Hon. G R. (Ed'b'gh, E.)

    Forman, J. C.

    Medland, H M

    Thorneycroft, Harry (Clayton)

    Fraser, T (Hamilton)

    Mellish, R. J.

    T hurtle, Ernest

    Freeman, Peter (Newport)

    Middleton, Mrs. L

    Tiffany, S.

    Gaitskell, H. T. N

    Mitchison, G. R.

    Timmons, J.

    Gallacher, W.

    Monslow, W.

    Titterington. M. F

    Ganley, Mrs C. S

    Morgan, Dr. H. B.

    Tolley, L.

    Glbbins, J.

    Morley, R.

    Vernon, Maj. W F

    Gibson, C. W

    Morris, Lt.-Col. H. (Sheffield, C)

    Walkden, E,

    Gitzean, A.

    Morris, P (Swansea, W.)

    Walker, G. H

    Glanville, J E. (Consett)

    Morris, Hopkin (Carmarthen)

    Wallace, G. D. (Chislehurst)

    Goodrich, H. E.

    Morrison, Rt. Hon. H (Lewisham, E.)

    Wallace, H W. (Walthamstow, E.)

    Gordon-Walker, P. C.

    Moyle, A.

    Warbey, W. N.

    Grenfell, D. R.

    Mulvey, A.

    Watkins, T. E.

    Grey, C. F.

    Murray, J. D.

    Watson, W. M.

    Grierson, E

    Nally, W.

    Webb, M. (Bradford, C.)

    Griffiths, D (Rother Valley)

    Neal, H. (Claycross)

    Wells P. L. (Faversham)

    Griffiths, W D (Moss Side)

    Nichol Mrs M. E (Bradford. N.)

    West, D. G.

    Gtuffydd, Prof. W J

    Nicholls, H R. (Stratford)

    White, H. (Derbyshire N.E.)

    Guest, Dr L. Haden

    Noel-Baker. Capt. F. E (Brentford)

    Whiteley, Rt. Hon. W.

    Gunter, R. J

    Noel-Baker, Rt. Hon P J. (Derby)

    Wigg, Col. G E.

    Guy, W. H

    Noel-Buxton, Lady

    Wilkes, L.

    Haire, John E. (Wycombe)

    Oldfield, W H

    Wilkins, W A

    Hale, Leslie

    Paling, Will T. (Dewsbury)

    Willey, O. G. (Cleveland)

    Hall, W. G

    Palmer, A. M. F.

    Williams, J. L. (Kelvingrove)

    Hamilton, Lieut.-Col. R.

    Parker, J.

    Williams, W R. (Heston)

    Hannan, W (Maryhill)

    Parkin, B. T

    Willis, E.

    Hardy, E. A.

    Paton, J. (Norwich)

    Wills, Mrs E. A

    Harrison, J

    Pearson, A.

    Wise, Major F, J

    Hasings, Dr. Somerville

    Peart, Thomas F.

    Woodburn, A.

    Henderson, Joseph (Ardwick)

    Piratin, P

    Young, Sir R. (Newton)

    Herbison, Miss M.

    Poole, Major Cecil (Lichfield)

    Younger, Hon. Kennet

    Hewitson, Capt. M

    Popplewell, E.

    Hicks, O

    Porter, G. (Leeds)

    TELLERS SOB THE NOES:

    Hobson, C. R.

    Price, M. Philips

    Mr. Michael Stewart and

    Mr. Daines.

    CLAUSE 48.—(Provisions as to pension rights.)
    Lieut.-Colonel Elliot: I beg to move, in page 58, line 4, to leave out from the beginning, to the end of line 14, and to insert:
    "(2) In the case of persons, whether taken into the employment of an Electricity Board or not, who have been members of the Central Electricity Board or were before the vesting date regularly employed in or about any undertaking or part of an undertaking or other business vested in any Electricity Board by or under this Act, the regulations to be made for the purposes of the preceding Subsection shall be so framed as to secure that where either—

    (a) a right to or expectation of accruer (whether as of right or under customary practice) of, any particular benefits in favour or in respect of any such person ceases or is prejudiced by reason of hisce asing in consequence of the passing of this Act to be employed by his previous employer, or

    (b) any such person has retired from employment as aforesaid before the vesting date and he or another person by reference to his employment has been in receipt of benefits granted in respect of his employment whether as of right or under customary practice,

    the same benefits or substituted benefits not less advantageous shall be provided for under the regulations."
    This is the first of our compensation Amendments, and it seems reasonable to us that the safeguards they provide should be inserted. The whole position of persons who have been taken into employment or whose employment is altered under the conditions of this Bill is rather obscure. The action of the Minister is to sweep away the previous safeguards and replace them by undertakings. We think it is desirable to extend the scope of the Clause to cover all persons who have a right to or an expectation of a pension and persons who were regularly employed in the undertakings which are taken over. The Bill, as I understand it, covers only those who were employed full time. We had this discussion last night on a different set of individuals —the directors—but I should, not think the Minister will desire to extend the principle which he asserted in the case of directors to cover part-time employees who have also lost their employment or have been otherwise affected by law through the action of this House. It seems reasonable that they should be compensated.
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    I have had experience of this in many spheres before in Bills which this House has put through, mostly dealing with public employment of one kind or another, and this House has always accepted the principle that where a person is deprived by Statute of employment, whole-time or part-time, or even the prospect of employment, he has a right to have his case considered. I do not know whether the Minister is able to give us any indication that he can meet us on this point. It seems not, judging from his hostile gestures. There is more than one Minister on the Front Bench, and the learned Solicitor-General seems to be moving his head from left to right in the way which is taken to indicate a negative.
    5.0 p.m.
    Mr. Shinwell: He did not agree with the right hon. and gallant Member.
    Lieut.-Colonel Elliot: I thought he did not agree that he would be able to meet us. I would be only too glad to cut short the discussion. I was trying to get some indication from the Minister whether he might meet us on this point, and I have gathered from the gestures of the Solicitor-General that he would not be able to do so. I find it rather difficult to see why it is thought desirable by the Minister to expand the point to the House, because frankly the Amendment is self-explanatory. I do not think that I could add to it and I do not wish to dilate upon it. The simple proposition set out in our Amendment is reasonable and is well in accord with previous precedents established in the House.
    Mr. J. H. Hare: I should like to support the Amendment proposed by my right hon. and gallant Friend the Member for the Scottish Universities (Lieut.-Colonel Elliot), and before we have a reply from the Solicitor-General I should like to concentrate particularly on local government officers who are employed on a whole-time basis by a local authority. As part of their duties they have had large responsibilities in the running of local municipal electrical undertakings. These duties as a result of the Government's action in introducing this Bill are taken away from this particular class of person, and it is almost inevitable that the salaries of local government officers such as town clerks or treasurers in the particular municipality

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    will be reduced. It is perfectly right for the local authority to do this. But it seems to us quite wrong that the unfortunate individual, as a result of the action of His Majesty's Government, should lose that part of his salary which is being taken away from him through no fault of his own.
    I should like to point out to the Minister that, in fact, this principle of compensation to these wholly employed local authority officials is accepted in the National Health Service Act. Section 68 (1, a) states that local authority officers who have been connected with joint hospital boards are, in fact, to be compensated under that Act for positions lost, and all that we are asking this afternoon is that the same procedure should apply to local government officials, who will lose a portion of their salaries as a result of the municipal undertaking being removed from the control of the local authority. That is a reasonable case to put forward, and I do not believe that His Majesty' Government desire to impose any hardship on a worthy section of the Civil Service. I hope, therefore that the Minister will accept the Amendment. I have one further word to say before I sit down. It should be made quite clear that in Committee the Minister said that it was up to the local authority to compensate such officials for any loss of salary that they may suffer. That is obviously not a statement of fact, because I think the Minister must agree with me that no local authority has a right to give compensation unless it receives statutory power from Parliament to do so. I support the Amendment.
    The Solicitor-General: This particular Amendment does not directly raise the question of part-time employees, but of whole-time employees. It is true that it substitutes regular employment for whole-time employment, and one criticism I have to make of the terms of the Amendment is that it is very difficult to say what is meant by "regular employment," but that is a question of principle apart Leaving aside that principle, which is raised more directly on subsequent Amendments, we come directly to the issues dealt with by this Amendment and what it seems to do. My answer to it would be this—in point of fact it adds nothing to what is already in the Bill; and
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    I will endevour to explain why I say that.
    Clause 48 (1, a), covers both persons in the employ of boards and persons who have been in the employ of bodies which have been taken over by the boards as well as persons who have retired from those bodies, and, therefore, have not been taken over by the boards. So the same range of people who are covered by the Clause as it stands are covered by the Amendment. How are they treated? If hon. Members will look at the concluding words of the Subsection, they will see that in making regulations the Minister has to frame them in such a way that people having pension rights are not in any worse position by reason of the alteration than they were before. If hon. Members will turn to page 70, they will see that pension rights include the cases purported to be covered by the Amendment, for the Amendment includes rights to which the person concerned is not strictly entitled by law If hon. Members look at line 12 on page 70, they will see that the definition of "pension rights" includes:
    "any expectation of the accruer of a pension to or in respect of that person under any customary practice."
    The Amendment does no more than is already done by the Bill.
    Colonel Clarke: Surely the term "whole-time" is the governing word both as to employment and as to the expectation. The object of our Amendment was to expand that to cover those who have not been in full-time employment and who have both employment and expectations.
    The Solicitor-General: I am obliged to the hon. and gallant Member for his intervention. I had endeavoured to deal with it by pointing out that the question of principle arises on the subsequent Amendments on the Order Paper, and I was confining myself to what was the basic object of this Amendment. I am not really clear as to what is meant by the words "regular employment." It might be said that those words mean the same as whole-time employment, but whether they do or do not, the principle arises on the later Amendment.
    Mr. Hare: On a point of Order. I understand that the later Amendment is not to be called.
    Lieut.-Colonel Elliot: I ask for the guidance of the Chair on that matter.
    Mr. Deputy-Speaker (Major Milner): Mr. Speaker has decided not to call the next four Amendments. The first is the Amendment in the name of the right hon. Gentleman the Member for Southport (Mr. R. S. Hudson) in page 59, line 25, to leave out from "officers," to "being," in line 29, and insert:
    "who have been regularly employed in or about the whole or any part of any undertaking or business vested in or transferred by or under this Act."
    It is also not proposed to call the Amendment in the name of the hon. Member for Hitchin (Mr. Asterley Jones), in page 59, line 27, after "whole-time" to insert "or part-time." The Amendment in the name of the hon. Member for the Park Division of Sheffield (Mr. Burden)—in page 59, line 35, at end, insert:
    "(2) The Minister as respects the Central Authority and any Area Board, and the Secretary of State as respects the North of Scotland Board, shall by regulations require the Authority or Board to pay, in such cases and to such extent as may be specified in the regulations, compensation to persons who, immediately before the vesting date,—

    (a) devoted the whole of their time to employment by authorised undertakers; and

    (b) were employed for at least part of their time for the purposes of any functions which are transferred from the authorised undertakers in consequence of this Act.

    and who suffer loss of employment or loss or diminution of emoluments which is attributable to the passing of this Act."—
    is not being called; nor is the Amendment on page 59, line 41, at end, insert:
    "(c) Persons who were on the tenth day of January, nineteen hundred and forty-seven, and immediately before the vesting date, directors of any company to which Part II of this Act applies."
    Colonel Clarke: Is it the intention to call the next Amendment, in page 59, line 46, at end, insert:
    "(3) If within five years after the vesting date—

    (a)any existing officer relinquishes his employment on the ground that he has been required to perform duties which are not reasonably comparable to or are an unreasonable addition to those which as an officer of his previous employer he was required to perform; or

    (b)the services of any existing officer are dispensed with by an Electricity Board because his services are not required and not on account of misconduct or incapacity to perform such duties as immediately before the vesting date he was performing or might reasonably have been required to perform; or

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    (c) the emoluments of any existing office: are reduced,

    that officer shall unless the contrary be proved be deemed for the purposes of subsection (1) of this section to have suffered loss of employment or loss or diminution of emoluments by reason of the vesting
    For the purposes of this subsection the expression 'existing officer' means any person who was on the nineteenth day of November, nineteen hundred and forty-five, and immediately before the vesting date such an officer as is referred to in subsection (1) of this section and whose services are transferred to an Electricity Board by reason of the passing of this Act"?
    Mr. Deputy-Speaker: Yes, it is proposed to call that one.
    The Solicitor-General: Having disposed of the other facets of the Amendment in so far as part-time employees are concerned, the Government's case is that one has to draw the line somewhere and one feels when one is endeavouring to do justice in this matter that these employees give the whole of their time to the body by which they were employed. There is not really very much one can add upon that. The scheme of this Clause and of the regulations to be made under it are designed to ensure that at any rate those who can be said to have been engaged in the whole-time employ of these bodies are to be entitled. After all, that is a very substantial right of considerable value. They are entitled to be placed in that position not only with regard to those rights which they had as legally enforceable claims, but also in respect of those customary accruals, if I may so call them, to which they would expect to look forward in the normal course at the termination of their service.
    That is where we have sought to draw the line. If one goes beyond it and says, "We think that that is too stringent a restriction on the benefit rights," one gets into a very uncharted sea. How far is one to go? Who is to count as a part-time employee? What is to be the minimum qualification which is to rank for pension rights? We feel that it would be very difficult in practice to draw any line which could really work and which would be practicable. For this reason, in imposing the duly on the Minister to give the same pension rights, not only in respect of legally enforceable claims, but also in respect of customary expectations, we have thought that those valuable rights should be confined to persons with regard to whom it can be said that they are or were

    475
    whole-time employees of the bodies, or are whole-time employees of the boards which have taken over the undertakings of those bodies. We feel, therefore, that we cannot accept this Amendment even if— which is questionable—the expression "regularly employed" is an apt expression to cover part-time employees. If it is an apt expression, I would only say that it is extremely difficult from the wording to know which part-time employees could be said to be regularly employed and which not. Would it apply to a person who works only on Mondays, for example, or would it mean a person working three days a week? Would a person who does actual work come within the expression? If not, why is there to be any intelligible distinction made between a person who does not work regularly but does perhaps much more in the service of the body concerned than a person who works three days a week? There is no definable line of demarcation you can make if you go beyond the category of employees who have been full-time employees.
    5.15 p.m.
    Colonel Clarke: I want to clear up what was, I think, a misconception on the part of some hon. Members opposite last night concerning the position of directors. The right hon. Gentleman, in replying to my right hon. Friend the Member for South-port (Mr. R. S. Hudson) on a point about certain part-time directors, said in Standing Committee:
    "I am advised that directors who have some specific…"—[OFFICIAL REPORT, Standing Committee E, 15th May, 1947; c.1027.]
    Mr. Deputy-Speaker: What the hon. and gallant Gentleman is saying would not appear to have any relation to the Amendment at present before the House. He may not now seek to clear up something which happened last night, unless he can relate it to the present Amendment.
    Colonel Clarke: I think you will find, Mr. Deputy-Speaker, that this is relevant to the Amendment in page 59, line 41, which, I understood you to say, might be referred to during the present discussion.
    Mr. Deputy-Speaker: I am sorry but the Amendment has not been selected and is, therefore, not open to discussion.
    Mr. Asterley Jones: I understand that I shall be in Order if I refer during the discussion of the Amendment
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    now before the House, to the principle of the Amendment to page 59, line 27, which stands in my name. I trust that we have not heard the last word yet from the Solicitor-General on the subject of part-time employees. I am aware that the majority of the employees concerned are only partly engaged on the work of an electricity undertaking, but at the same time it must not be forgotten that there are others who are still employed but who spend only part of their time doing work in connection with the authorised undertakings. In my constituency there is an undertaking known as the First Garden City, Limited. This company, which was established over 40 years ago, is in fact the owner of the garden city of Letch-worth and, besides being the ground landlord of the whole of that garden city and carrying on a number of other undertakings, it is also the authorised undertaker for the electricity works.
    This company is proposing to take advantage of a Clause, which I understand the Minister is to move later today, whereby this electricity undertaking may be separated from the First Garden City, Limited, and established as a new, separate undertaking. At present the situation is that in the offices of the First Garden City, Limited, 26 persons are employed, none of whom is fully occupied on the work of the electricity undertaking, although many of them are employed on it for part of their time. It is obvious, for example, that in the accountants' branch, to mention only one, the receipts from the electricity undertaking are dealt with together with those from the various other enterprises in which this company is engaged. I am informed that of those 26 employees five only have nothing to do with electricity; four of them spend three-quarters of their time on electricity and the remainder on other work; five of them spend two-thirds of their time on electricity work, eight of them half their time, and three one-third of their time. When this undertaking is separated from the First Garden City, Limited, there will be two alternatives open to the firm — either to transfer some of these officials to that separate undertaking and to separate their work from the rest, which will give rise to a certain amount of waste, or to maintain the arrangement under which all the employees remain servants of the First Garden City, Limited, but are employed only part-time on the work in question. It

    477
    is easy to see that some of these men and women will suffer as the result of the change. Adjustments in duties will be made and, in the words of the Bill, they will undoubtedly
    "suffer loss of employment or loss or diminution of emoluments or pension rights."
    I do not imagine that these arguments apply to many people in this country, but they do to some. It is not confined just to that particular company. I imagine that there will be employees of local authorities also who will be adversely affected if the matter is allowed to stand as at present.
    Colonel Lancaster: I am grateful that the Solicitor-General should have given assurances in regard to the matter of pensionable rights, but I should like to deal briefly with this matter of part-time employment. I understand that it is giving rise to a good deal of concern and it is a very real question which requires clarifying. I understand that some undertakings have been in the habit of sharing certain types of minor artisan for their particular technical requirements. Such people as chemists who are employed on test work, and men of that kind, were shared between one or two, or possibly more, undertakings, and, therefore, cannot claim to come under the requirements of the Clause as it is at present drafted, although they have nevertheless been spending the whole of their time employed in the electricity industry as such. As the Clause is drafted, these men would not benefit. I am sure that that is an unjust situation, particularly as a man might have been taken on quite recently. He might have worked no more than a month or so. Nevertheless, he can claim that he has been employed whole-time. As the Solicitor-General said, it might be difficult to find a form of words to cover the cases which in no sense can claim to have been employed whole-time in the industry as a whole. That does not seem to be a real reason why the matter should not be fully considered, or why some formula should not be devised to cover those who might properly claim to have been employed full-time within the industry as a whole, although only part-time in some particular part of it.
    Mr. Collins: I support the point of view which has been put forward by my hon. Friend the Member for Hitchin (Mr. Asterley Jones). The present
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    provisions of the Clause do not fulfil what I feel is the genuine intention, that people who are employed in undertakings, whether whole-time or part-time, shall not suffer either in their employment or otherwise when the undertakings are transferred. There is a danger that many people employed part-time will definitely suffer. We have had a lucid explanation from the Solicitor-General, but I feel that this has only made the position of part-time employees even more obscure. I do not accept the plea which has been put forward that part-time employees in municipal undertakings are likely to be covered by the Severance Clause which is to be proposed later today. Undoubtedly many of those people are employed in a part-time capacity and may become redundant or have their employment affected. It does not seem that their position will be covered by any over-all provision for compensation. There is undoubtedly considerable uneasiness among those people. We cannot afford to run the risk that they may not be provided for. We cannot afford to let them have less than justice, and they may get less than justice unless there is a suitable Amendment or a form of words to cover their cases.
    Mr. Shinwell: It is all very well for my hon. Friend to say that it should be comparatively simple to find a form of words to cover what are called part-time employees. It is a matter we find exceedingly difficult. We had an illustration given to us, in connection with electrical composite undertakings, of how difficult it is. There are many variations among part-time workers. We must make a distinction between the apparent part-time worker who is an officer of a local authority and who, as a result of severance of the main electricity undertaking, may lose emoluments. That matter can be easily adjusted. In any event, his position is covered by the provisions relating to the statutory rights of local officers.
    The remainder of the cases must be very difficult. I heard of a few cases connected with the Letchworth garden city composite undertaking. A person may be employed in a composite undertaking for an hour each day as a part-time worker. That is the kind of person with whom we are concerned. As a result of severance, he presumably loses what he would normally receive for the hours

    479
    worked per day. I should imagine that the part of the undertaking that is left might easily adjust that matter, which should present no difficulty. If we are to be compelled to consider the cases of these part-time workers, we shall find ourselves in a position of great difficulty. All sorts of people will be coming along and saying: "As a result of the severance, I have lost this or that." Burdens will be imposed upon the new Central Authority, but they will have to be borne, not by that authority, but by electricity consumers themselves. We have to safeguard ourselves against a position of that kind.
    We have taken every precaution that I can see in order to ensure that persons generally employed, and who are regarded as employees of an electricity undertaking, should have their statutory rights preserved, and that pension, superannuation and the like should be providd for them under regulations, which it is my duty to promote when the Bill becomes an Act. That seems to be as far as I can go. I am satisfied that if I proceeded further than that it would create a position of great complexity. It may be that in severance of these composite undertakings some kind of financial adjustment can be made. I imagine that the Central Authority can deal with a matter of that sort without any provision being made in the Bill. It is a consenting financial authority. If certain adjustments were required to be made, that could be done. To ask me to provide legislation to protect these part-time workers who are employed very little of their time in the undertaking seems to me to be a new idea in legislation which might be very injurious. I must ask the hon. Gentleman opposite not to press the proposal. In the case of the Amendment to page 15, line 4, which was dealt with so lucidly by the Solicitor-General, I should like to point out the great difficulty of finding a definition for regularly employed persons, although we know what is meant by that expression.
    Colonel Lancaster: The term "regularly employed" is frequently used in connection with the Electricity Act, 1919. It is not a new term, but it is new in this connection.
    Mr. Shinwell: We have covered that point by providing as good a definition as
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    we can get. It is covered by a provision which hon. Gentlemen opposite wanted to delete from the Clause. It is in Clause 48 (2). I should have thought the position eminently satisfactory. I do not suppose that hon. Gentlemen opposite see any objection to that. As regards the Amendment, I cannot see how it is possible to make provision in any specific fashion. I am afraid that I cannot accept the Amendment.
    Commander Galbraith: One of my hon. Friends referred to a case in which men were employed by a number of electricity undertakers. They could not say that they were employed full-time by any one of them. Nevertheless, their full time was spent in electricity undertakings. The right hon. Gentleman did say "generally employed." Will he explain whether those words cover such persons as I have indicated?
    Mr. Shinwell: I am giving an offhand reply, but I think I can say that if a person is employed whole-time in a number of undertakings, he would come within the provisions of the Clause. He could not possibly be excluded, because he is employed in the electricity industry whole-time.
    5.30 p.m.
    Lieut.-Colonel Elliot: It is clear that the House is not happy about the position in which it finds itself. Comments have come from both sides on this point. Indeed, it is not unnatural, because it arises out of the definite pledge which the Minister gave on the point. On that pledge, an Amendment was withdrawn in Committee. The Minister of Fuel and Power said:
    "Some reference is made in some Amendments to part-time employees. I doubt very much whether it would be possible to bring them within the scope of this provision, but we will do our best to find a suitable form of words, and perhaps that will meet the point."
    My hon. Friend the Member for Wavertree (Mr. Raikes) said:
    "In view of what the right hon. Gentleman has said, I beg to ask leave to withdraw the Amendment."—[OFFICIAL REPORT, Standing Committee E, 15th May, 1947; c. 1018.]
    That is a very definite undertaking by the Minister. It is true that in earlier stages of the discussion the Minister—
    Mr. Shinwell: I am sorry, but the right hon. and gallant Gentleman cannot get away with this.
    Lieut.-Colonel Elliot: The Minister must restrain himself for a minute.
    Mr. Shinwell: There is not much point in the right hon. and gallant Gentleman quoting me without doing so adequately.
    Lieut.-Colonel Elliot: Believe me I have no intention whatever of misrepresenting the Minister of Fuel and Power. It will be seen in HANSARD. I was just about to say that while it is true that in an earlier stage the Minister had shown himself adverse to the position of part-time employees—and I was about to quote what he said—he said earlier in the same column:
    "It may be that the term 'full-time' is not adequate for the purpose, but 'regularly employed' would open the door to all sorts of categories of a part-time character, which might create difficulties…"
    Then he went on to say:
    "I want to make it quite clear that we could not, so far as I can foresee, agree to provide for part-time employees, whatever that may mean."
    Then he said, in these concluding words which I have quoted:
    "Some reference is made in some Amendments to part-time employees. I doubt very much whether it would be possible to bring them within the scope of this provision, but we will do our best to find a suitable form of words, and perhaps that will meet the point."—[OFFICIAL REPORT, Standing Committee E, 15th May, 1947; c. 1018.]
    I contend that I am not in any way misrepresenting the Minister. At an earlier stage of his speech he turned his face against the part-time employees but seemed to modify, his opinion as his speech proceeded, and when, in his concluding words, he gives an undertaking to try to meet a certain point and the Amendment is withdrawn, then unless the Minister specifically demurs at that point, it is generally taken that it is in the nature of, I do not say a Parliamentary bargain, but an undertaking to give attention to this point.
    The desirability of it has been shown both by the hon. Member for Hitchin (Mr. Asterley Jones) and the hon. Member for Taunton (Mr. Collins), as well as by hon. Members on this side. The Minister says it will be difficult to do that, but the Minister, in taking power to draw a regu-
    482
    lation, should not think it impossible for him to ensure that such cases could be considered. He himself says that the number of cases would be small; therefore, that disposes of his other argument that undue burdens might be thrown upon the electricity undertakings by the liability which the House, without distinction of party, seeks to lay upon his shoulders. The fact that only a few people have to be considered is not an argument against taking action. All of us know in our capacity of Members of Parliament that the most irritating thing in the world is to find some person with a perfectly legitimate grievance in our constituency which cannot be remedied because of some Section in an Act of Parliament. The person in question nearly always thinks it is due to the malice aforethought of the Member with whom he or she happens to be in correspondence that the grievance cannot be rectified.
    We are only trying to see that this small class of case should not arise. Indeed, the Minister himself says that he has heard of cases in the Welwyn area. It is not a great point, but it is one which other Ministers have to meet. I have had to meet it myself as a Minister framing legislation. An hon. Member behind me said that it has had to be met in this administration by Ministers framing the Health Service Acts. This is not infrequent; it is a puzzling, troublesome and a tedious matter to put it straight, but for all that it is the business of Parliament to put these things straight. If they are not, it is impossible for the Minister to deal with it afterwards by regulations. The Minister has debarred himself from taking any action to meet a class of case which all of us can foresee by the use of the word "whole-time." We suggest that he should not leave that word in the statute and that, if he leaves it in, he, the Minister, and we, the Members, will suffer inconvenience and trouble and, still worse, the lieges for whom we are legislating will suffer. It seems to us, therefore, that a reasonable case has been made out and pressed upon the attention of the Minister from both sides of the House, and it is reasonable that the Minister should correct it now, or should undertake, in the terms of his words upstairs, to give further attention to it between the time when the Bill leaves here and the time when it is under consideration in another place.
    Mr. Gallacher: The right hon. and gallant Gentleman said that Members are very worried about this Subsection. I am seriously worried about it and I ask the Minister to consider carefully what he is doing. It says:
    "The Minister and the Secretary of State jointly shall by regulations require every Electricity Board to pay…compensation to officers, employed whole-time for the purpose of administering the undertaking or any part of the undertaking of any authorised undertakers, being officers who suffer loss of employment or loss or diminution of emoluments…"
    Why should the Minister put that in a Bill? What we have always stood for when there has been loss of employment or emolument is work or full maintenance until work is provided. Hon. and right hon. Gentlemen opposite will recollect that, when the parish councils were taken over, those officers who lost their employment were compensated in the form of a pension of £300, £400 or £500 a year—£6, £8, or £10 a week. Nobody can dispute that. Any of these men may have got employment and, at the present time, be employed by an electricity undertaking. Now they will lose their employment with that electricity undertaking and their emoluments—does the right hon. and gallant Gentleman question that?
    Lieut.-Colonel Elliot: I was engaged in trying to restrain hon. Friends of mine from engaging in altercation. I am most anxious that the hon. Gentleman should conclude his argument undisturbed.
    Mr. Gallacher: None of them can question the fact that compensation was paid, and that the people now have pensions of £6, £8, or £10 a week; and there is nothing in connection with the pension to prevent them from taking a full-time or a part-time job with an electricity or any other undertaking. If they lose their employment with an electricity undertaking, are they to get another pension of £300, £400 or £500 per annum? I ask the Minister if we are to be put in that position?
    5.45 p.m.
    Mr. Shinwell: As regards what my hon. Friend the Member for West Fife (Mr. Gallacher) has said, there is no intention of providing substantial pensions for persons who are transferred and who will occupy positions in the nationalised industry with high salaries, but we have to
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    preserve the statutory rights of every individual concerned. That is an obligation which we cannot set aside. I have looked again, at Clause 48 and I imagine that provided—and I must emphasise this— provided a suitable formula could be arranged within the regulations—because it is impossible to do it in any other fashion—then Subsection (1, a) of this Clause might enable us to do so. It reads:
    "for providing pensions to or in respect of persons who are or have been in the employment of an Electricity Board or a Consultative Council, or persons who have been members of the Central Electricity Board"—
    I direct attention to these words—
    "or have been employed by any body to which Part11I of this Act applies or have been employed whole-time for the purpose of administering the undertaking or any part of the undertaking of any authorised undertakers, but who have not been taken into the employment of an Electricity Board as aforesaid;"
    Let me take the case of a composite undertaking. Part II applies to the transfer of the electricity section of a composite undertaking, and, therefore, an employee of such an undertaking would come within the scope of this provision. That is clear. The remaining question is whether we could find a suitable formula which would cover a person who, while he had been in the employment of an undertaking covered by Part II, had already been partly employed in the other section of the composite undertaking. I am not certain whether it is possible to find such a formula, but we shall do what we can so that no injustice shall be done to anybody. On the other hand, we must not be unjust to the Central Authority. I do not think it is possible to go beyond that, and I am afraid that is my final word
    Lieut.-Colonel Elliot: It seems that there was a little misunderstanding about the Minister's previous remarks, so I would like to be quite sure that there is no misunderstanding now. I hope there is no misunderstanding that the right hon. Gentleman is now giving an undertaking that he will look into this.
    Mr. Shinwell: No, I am certainly not.
    Lieut.-Colonel Elliot: It is desirable that we should get this clear, for nothing could be worse than a suggestion that some misunderstanding which has arisen

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    has not been cleared up. I understood from the Solicitor-General that he considered that no case of part-time employees could be dealt with under this Bill. Indeed, I understood that from the Minister's remark when he demurred to his final pledge being queried, and stood by his earlier remarks upstairs. Now I understand that the Minister, on examining the Clause, has said that he thinks the case quoted by an hon. Member could be covered under the terms of Subsection (1, a)of Clause 48. Do I carry him with me so far?
    Mr. Shinwell: Yes.
    Lieut.-Colonel Elliot: He thinks he can do something here by means of regulations, but repeats his caution that he may not find it possible to do anything in the way of regulations? Do I understand that the Minister is now willing to try to do something by regulations in respect of the class of cases which he had previously indicated he could not do anything about; that the Minister is moved in this respect, and is now giving an undertaking to the House that he will try to meet by regulations the class of case pressed upon him by the House which previously he could not deal with? If that is the understanding, then we are all at one.
    Mr. Shinwell: In my first speech i indicated how difficult it would be to find a formula. That was my sole difficulty. I have looked at this, and while I still think it would be difficult to find a formula, I will make the attempt when I am dealing with the regulations.
    Mr. McKie: I feel sure that my right hon. and gallant Friend the Member for Scottish Universities (Lieut-Colonel Elliot) who showed such laudable concern to protect the hon. Member for West Fife (Mr. Gallacher), will allow me to say that I felt concerned when I heard that hon. Member speaking so earnestly to the Minister—
    Mr. Gallacher: There is another provision which deals with pension rights. We are all in favour of pension rights being maintained.
    Mr. McKie:I thank the hon. Member for what he has said, but it does not do away with what I felt he tried to impart into the "discussion. In my con-
    486
    stituency there is a very large hydroelectric undertaking and I cannot think there is a possibility of cases existing such as the hon. Member for West Fife quoted in connection with the parish councils— which were done away with as long ago as 1929—in which emoluments of £6 a week would be drawn. I was very glad to hear the Minister, if I may use the expression, almost giving the lie direct to what the hon. Member for West Fife said about cases like this, which must be very few and far between, and if the hon. Member does not accept my assurance I hope he will accept the assurance of the right hon. Gentleman.
    On behalf of people in my constituency and many employed in such undertakings I join in hoping that the Minister will be as good as his words, and although he rejects the Amendment I hope he will see what he can do under Subsection (1, a) of Clause 48 by way of regulation to assure the future position of these people. We are not trying to make party capital out of this. I do not think those who have been employed part-time so far, when they read the Debate—and there are a larger number of people than ever who read HANSARD now—will be pleased with what the Minister has said. I feel sure they will be impressed by what my right hon. and gallant Friend has said and they will feel that we are concerned, even including the lone voice of the hon. Member for West Fife, although he succeeded in imparting political prejudice into his speech.
    Colonel Clarke: In view of the assurance given by the Minister, I beg to ask leave to withdraw the Amendment.
    Mr. Deputy-Speaker: The hon. and gallant Member did not move the Amendment and, therefore, cannot ask leave of the House to withdraw it.
    Lieut.-Colonel Elliot: In that case I will do so. I beg to ask leave to withdraw the Amendment in consideration of the assurance the Minister has given, although it was of a rather more tenuous nature than I. would like on this occasion, but we are glad that he showed himself so reasonable.
    Amendment, by leave, withdrawn.

    CLAUSE 49.—(Compensation to officers in connection with transfers.)
    Colonel Clarke: I beg to move, in page 59, line 46, at the end, to insert:
    "3) If within five years after the vesting date—

    (a)any existing officer relinquishes his employment on the ground that he has been required to perform duties which are not reasonably comparable to or are an unreasonable addition to those which as an officer of his previous employer he was required to perform; or

    (b) the services of any existing officer are dispensed with by an Electricity Board because his services are not required and not on account of misconduct or incapacity to perform such duties as immediately before the vesting date he was performing or might reasonably have been required to perform; or

    (c)the emoluments of any existing officer are reduced,

    that officer shall unless the contrary be proved be deemed for the purposes of Subsection (1) of this Section to have suffered loss of employment or loss or diminution of emoluments by reason of the vesting.
    For the purposes of this Subsection the expression 'existing officer' means any person who was on the nineteenth day of November, nineteen hundred and forty-five, and immediately before the vesting date such an officer as is referred to in Subsection (i) of this Section and whose services are transferred to an Electricity Board by reason of the passing of this Act."
    This straightforward and simple Amendment is a simplified substitute for the provisions of the existing law. It will give employees who may be found to be redundant in the first five years after the vesting date, some right of compensation. Although at the beginning of the five years there would not be many cases, as time went on they would be likely to increase. At first there will be a good deal of work in organising these new bodies, but, as time goes on, fewer employees will be needed. Similar provision to this is made in Section 77 of the London Passenger Transport Act, 1\938. Whereas today a redundant employee in the electricity industry can get a job with an alternative company, when the whole industry is nationalised there will be no other possible employment for him, and he will be out of work.
    Major P. Roberts: I beg to second the Amendment.
    I do so particularly because it puts the onus of proof away from the employee who may be taken out of
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    employment. I particularly draw the attention of the Minister to the words:
    "that officer shall, unless the contrary be proved…"
    Here we are dealing with the monopoly of labour. It is happening in the nationalisation of the coal industry, although I know the Minister does not like it, and I do not think responsible members of the Coal Board like it. Men are being asked to take lesser jobs, and when they demur, they are asked over the telephone, "You are not going to fight the Coal Board, are you?" When there is a monopoly of labour these temptations occur. The Amendment is designed to provide that when the man says, "I will not take that job on" he gets his rights, unless the contrary can be proved. It is a safeguard to the employee.
    Mr. Shinwell: I am afraid I cannot accept the Amendment in its existing form, although in principle I take no exception to what is here presented. There are exceptions. For example, I could not tie myself down to a qualifying date or period of service. The principal reason why I cannot accept the Amendment in this form is because I think these provisions are more appropriate to be dealt with by regulations, and provision is made for regulations for this purpose. So I agree, with certain modifications and adjustments which are appropriate to the particular circumstances of this industry, to provide regulations which will cover substantially the proposals contained in the Amendment.
    6.0 p.m.
    Major P. Roberts: Does that also covet the point of onus of proof, which I mentioned?
    Mr. Shinwell: I would not like to say offhand. I would like to look at that, but it appears to me to be quite reasonable.
    Mr. R. S. Hudson: May we take it the regulations will substantially meet the points which have been made? I understood the right hon. Gentleman to say that he did not like the words "five years," and did not want to tie himself to that particular period. May we take it that the regulations which he will issue will substantially carry out the terms of this Amendment? The Minister knows better than any one else that when it comes to

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    a matter of regulations, all we shall be able to do, presumably, will be to move a negative Resolution. We shall not be able to amend them. It is quite conceivable that when the regulations are presented to the House they will, in fact, be generally acceptable but for some one particular item, such as the length of time. I am sure that the Minister would agree that if my hon. and gallant Friend withdraws his Amendment on this understanding, we should have some general idea of what the Minister intends to do, broadly speaking, to carry out the terms of our proposals. I am not asking him to tell us in detail.
    Mr. Shinwell: The right hon. Gentleman will understand that it is quite impossible for me to provide at once an alternative form of words. I have said, and I repeat that substantially I accept this proposal. There may require to be modifications. The regulations may be a little better or slightly worse than this, but the principle is accepted.
    Mr. Boyd-Carpenter: Does the right hon. Gentleman accept what I think is'the most important part of this Amendment, the transfer of the onus of proof? I do not want to tie him down to any particular details, but I think we are entitled to have an answer to the general question, that an unfortunate person, faced with this great monopoly, shall know that he will not have to establish his case, but that the onus is the other way round
    Mr. Shinwell: I have replied to another hon. Member that it is very difficult for me, off-hand, to express an opinion on that. I said that I thought it was reasonable.
    Mr. Hobson: I am concerned with the question of compensation for loss of status. I am in agreement with the aim of the Amendment so far as the preservation of salaries is concerned, but I hope that the question of reduction of status is not to be a ground involving compensation. Surely the passing of this Measure does not mean that all the chief engineers will continue to be chief engineers. There is to be some rationalisation, particularly where areas are very small, and there are many small undertakings. I hope that the Minister will not consider that loss of status, the fact that a man is not to be chief of a particular area, is to be a prima facie case for compensation. I
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    am in agreement with hon. Members opposite so far as preserving the salary and conditions of employment are concerned, but status is a different matter.
    Mr. Shinwell: The only assurance I can give is that we shall not go beyond what is reasonable. If there are persons in the industry who have been transferred for one reason or another, and there is a moderate loss of status, provided that the salary remains the same and the person concerned is not worse off financially, that would not appear to me to call for any additional compensation. We expect that the regulations will be framed in a reasonable fashion, and that is what I am prepared to do.
    Colonel Clarke: In view of the assurance given by the Minister, particularly that he will go into the question of onus of proof, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. Shinwell: I beg to move, in page 60, line 21, to leave out "may," and to insert "shall."
    This is moved in order to make the provision mandatory instead of permissive. We had some discussion in the Committee, and I decided accordingly.
    Amendment agreed to.
    Colonel Clarke: I beg to move, in page 60, line 47, at the end, to insert:
    "(7) Regulations made under this Section shall be so framed as to secure that no person shall be in any worse position under the regulation than he would have been if the relevant provisions of the Acts repealed by this Act had been re-enacted with any necessary adaptations."
    This is a suggested final Subsection to Clause 49. In view of what the Minister said in regard to our previous Amendment, he may favourably consider this one. This is a sort of sweeping-up Clause, based partly on Clause 48 (2). That Subsection begins:
    "Where provision is made by any such regulations for the amendment, repeal or revocation of any existing pension scheme or of any enactment relating thereto…regulations shall be so framed as to secure that persons having pension rights are not placed in any worse position by reason of the amendment, repeal, revocation, transfer, extinguishment or winding up."
    There is today a mass of legislation on this subject, rather long and rather complicated, but it ensures that employees

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    who become redundant today are compensated, and are not prejudiced, on any reorganisation of electricity undertakings, in regard to their pensions and matters of that sort. I suggest that the words that we are proposing are more definite and more favourable than those in Clause 49.
    What is about to happen in the industry? It would be an understatement to call it a reorganisation. It is such a complete upheaval that there is a greater risk of hardship in this direction than previously. A certain clearing up of the legislation is required. Many electricity companies have extremely good pension schemes for their employees at present, and it will be rather hard if, when they came into national employment, they should be worse off than they are at present under private employment.
    Colonel Crosthwaite-Eyre: I beg to second the Amendment.
    Mr. Shinwell: I hope that hon. Members will not press me to accept this Amendment. As I have indicated, regulations will be provided, but there must be certain modifications of the old practice relating to compensation. We have provisions contained in the London Passenger Transport Board Act, and there are other Acts of Parliament which prescribe what shall be done in cases of this sort when compensation is created thereby. We have to modify these practices in the light of modern conditions, and there has been a change in conditions, for example, full employment, which it is hoped will continue. There are also other factors which must be taken into account.
    The best I can do is to say that we take note of this proposal. It is not our desire that the position of any person should be worsened, and, inasmuch as the position of any employee is worsened, that is a factor which will no doubt be taken into account alongside other factors. But the other factors certainly must enter into the calculations of those who are responsible for making the regulations. Therefore, I am afraid that this is an Amendment which takes us rather too far along the road at this stage. Indeed, it is a little premature, because we may have the discussions with appropriate and representative organisations who are concerned in such matters
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    before we decide definitely on the terms and provisions of the regulations.
    Mr. R. S. Hudson: The right hon. Gentleman will realise that, although conditions may have changed, and no one could deny that, the fact remains that over a long period of years a code of compensation practice has been built up. The Minister said a change had come about as a result of full employment. In the case of the younger members of the: staffs, no doubt that is true, but I think anybody who has had any experience of the last year or so will agree that one of the tragedies of the present day situation is that, although there may be nominally full employment and there may be nominally a shortage of manpower to fill the potential jobs, the fact remains that the number of jobs available for the older people, especially for people over 40, definitely is on the decline. I imagine that there is hardly an hon. Member of this House who has not had the experience which I have had of people writing to me and saying that the Ministry of Labour Appointments Bureau have done the best they can but, being over 40, they receive the reply to all the applications they make to firms whose names have been given to them by the local exchange, "The vacancy is not available for people of this age because of difficulties with pensions schemes and so forth."
    No one would deny that at present there is a substantial body of people who have served during the major portion of their early and middle age who today are finding it impossible to get a job. To that extent the situation has, if anything, deteriorated compared with what it was 10 or 15 years ago. Therefore, we are concerned about these older people who, while private enterprise and local authority under takings were in existence in large numbers, might have stood a chance of finding some alternative employment in the job for which they were educated and trained and in which they, have spent the major portion of their working lives. Those people will find it even more difficult than it was before to find jobs as a result of the amalgamation and reorganisation that is to take place.
    Mr. W. R. Williams: In all the amalgamations which took place after the 1914–18 war, when

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    large shipping firms and other organisations amalgamated, was it not people of this age who suffered in exactly the same way?
    6.15 p.m.
    Mr. Hudson: I agree that they suffered, but I do not think that they suffered quite to the extent which the evidence that reaches all of us in all parts of the House leads us to believe today. I suggest that successive Parliaments for the last 30 or 40 years have been impressed with the difficulties. That was increasingly the case during the period which the hon. Member mentioned. Parliament has been at particular pains during all these years to build up a code of compensation practice. The Minister may say he is justified. We will not argue that for the moment. Hon. Members will admit that there is no question but that Clause 49 as drafted is substantially less favourable than the alternative code. We are anxious to see that in any regulations the Minister may make the terms shall be at least as favour able as the code. The mere fact that it is difficult to provide that ought not, in our view, to be a reason for depriving these people of the compensation which, if it had been a matter of the amalgamation of private companies or local authorities, they would have enjoyed. I hope that the Minister will remember that and not ride off with the excuse that conditions have changed.
    The right hon. Gentleman said, quite rightly, that these regulations which will have to be drawn up and published, will have to form the subject of discussions with the associations or bodies, whoever they may be, who may be taken to represent the interests of the persons concerned. There is not an hon. Member in any part of the House, still less any hon. Member opposite, who would deny the proposition that these bodies would feel themselves in a very much better negotiating position if they had been fortified with the existence of some Clause such as we suggest, than if they are merely left to the tender mercies of the right hon. Gentleman, however tender some hon. Gentlemen may think they are likely to be. I hope the right hon. Gentleman will bear that in mind when he comes to negotiating with the persons concerned.
    Amendment negatived.

    CLAUSE; 50.—(Application, amendment and repeal of enactments relating to electricity supply.)
    The Solicitor-General: I beg to move, in page 63, line I, to leave out from "Where" to "the," in line 2.
    This and the next Amendment go together, and I hope I may be allowed to explain both at the same time. This is a slightly technical Amendment. I think I can summarise it most easily by saying that during the Committee stage criticism was directed against Subsection (6) of Clause 50 on the ground that it was extremely obscure in that it did not say what sort of notice was referred to in the first line of the Subsection. We have sought to meet that simply by excluding reference to the notice. It is not really necessary in the form the Bill now takes, and it makes it clear. It provides that where an undertaking does exist, those enactments which previously applied to it shall not cease to apply to it by virtue of the foregoing Subsection.
    Mr. R. S. Hudson: I appreciate that the learned Solicitor-General has tried to improve this Clause. I am advised that it would be improved still more if, in line 8 on page 63, instead of the words:
    "cease to apply to the undertaking"
    the words
    "cease to apply to any undertaking."
    were inserted. I confess I am not sufficiently well versed in the law to appreciate that fully, but that is what I am advised. If the Solicitor-General can see his way, perhaps in another place, to have the further slight alteration made, it would improve even more the concession for which we are most grateful.
    The Solicitor-General: I am grateful to the right hon. Gentleman for his suggestion which I would like to consider further.
    Amendment agreed to.
    Further Amendment made:
    In page 63, line 2, leave out "authorised undertakers" and insert:
    "person authorised by any enactment to supply electricity."

    CLAUSE 54.—(Provisions as to prosecutions and as to offences by corporations.)
    Mr. Deputy-Speaker: Mr. Foster.
    Major P. Roberts: On a point of Order. Am I to understand that my

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    Amendment dealing with decentralisation is not being called?
    Mr. Deputy-Speaker: The Amendment in the name of the hon. and gallant Member is not being called.
    Major Roberts: May I ask the assistance of the Chair as to whether it would be in Order, on recommittal, to bring up this question, as it has the support of very nearly 95 per cent, of the local authorities in this country, and was not discussed on the Committee stage?
    Mr. Deputy-Speaker: No, it will not be in Order.
    Mr. R. S. Hudson: Further to that point of Order. When we come to the recommittal, a point will arise. I do not want to get involved in the argument now, because I shall be able to discuss it with whoever is in the Chair at the time. Mr. Speaker told us, I think yesterday or on Monday, that we should have to have a second Report stage in respect of the Clauses and the Amendments that have been recommitted. I merely enter this caveat. We want to know in what position we shall be in regard to our manuscript Amendments, because we have had no opportunity of putting any Amendments for the Report stage on the Order Paper. Presumably, the second Report stage will follow immediately upon recommittal, and the question really arises whether it would be in Order to put down this Amendment as a new Clause, assuming that it is not in Order to move it now, and assuming also that my hon. and gallant Friend desires to move it then. This does raise an important question of principle, which has been put forward by the overwhelming mass of the local authorities.
    Mr. Deputy-Speaker: The right hon. Gentleman has put to me a question which he knows is difficult to answer. The Ruling was that this Amendment has not been selected by Mr. Speaker, and therefore cannot be discussed. With regard to the other question asked by the right hon. Gentleman, I have no doubt that he will find another opportunity later on of putting that question.
    Mr. Hudson: I only mentioned it, because I thought it would be for the convenience both of the Chair and the House. We realise that we shall have an opportunity to raise the point later on.
    Mr. John Foster: I beg to move, in page 65, line 14, to leave out Subsection (2), and to insert:
    "(2) Where an offence under the last foregoing section or any regulation made under this Act which has been committed by a body corporate is proved to have been committed with the consent or connivance of or to be attributable to any negligence on the part of any director manager or secretary or other officer of the body corporate he as well as the body corporate shall be liable to be proceeded against and punished accordingly."
    The Clause deals with the prosecution of directors who were members of a body corporate which had been found to have committed an offence, and the Clause, as it stands, puts a very severe burden of proof on the directors. It states:
    "(2) Where an offence…has been committed by a body corporate, every person who at the time of the commission of the offence was a director, general manager, secretary or other similar officer of the body corporate, or was purporting to act in any such capacity, shall be deemed to be guilty of that offence unless he proves that the offence was committed without his consent or connivance and that he exercised all such diligence to prevent the commission of the offence as he ought to have exercised having regard to the nature of his functions."
    That is a very severe burden of proof, and the object of the Amendment is to make the Clause more in accordance with the ordinary rules of the criminal law and of the law of the land, by making the prosecution prove that the directors acted without due diligence and that they consented or connived. I submit that this would not prevent the proof of offences in those cases where offences had been committed, but it would avoid Injustices where the burden of proof placed on the directors is too high.
    As I understand it, the learned Solicitor-General, when moving Clause 54, said that the Clause has precedents in other Statutes besides the Coal Industry Nationalisation Act. I do not know of any, and I would be obliged to him if he would point out to me where this Clause has any precedents. Even if it has precedents in addition to the Coal Industry Nationalisation Act, my submission is still good that it places too great a burden of proof on the directors—and also on officials of the company, because the Clause mentions the general manager, secretary or other similar officer—to prove affirmatively that the company acted without their consent and connivance. It is very difficult to prove a negative, and

    497
    very difficult to prove affirmatively the degree of diligence which they should have used.
    Whatever case there may be about authority for this Clause, the House will recollect that the exact wording of this Amendment is to be found in the two Insurance Acts passed last year by this House and sponsored by the Government. The exact terms of this Amendment were introduced into both those Acts. I would therefore ask the learned Solicitor-General to point out why it is necessary in this Bill to cast this very severe burden of proof on directors and officials of the company, when it was not done in the two Insurance Acts. I would also ask the Solicitor-General, in view of what has been said by the Minister in connection with the burden of proof, to accept the principle of this Amendment, even if he finds that the wording is not quite correct, though, in my submission, it is correct, because it follows the other Acts of Parliament. I hope he may accept the principle with regard to the onus of proof, and have the matter considered.
    Sir A. Gridley: I beg to second the Amendment.
    The Solicitor-General: The hon. Gentleman who moved the Amendment asked for a precedent, and also asked why we should place such a severe burden upon directors and upon other officials of the same standing in the same company. In the first place, there is ample precedent, and in the second place, I do not accept that the burden is a severe burden. On the contrary, it is a comparatively light burden. May I take each of those points in turn? There is a whole series of Acts in which, in one form or another, the burden of proof is placed upon the directors to exculpate themselves. Apart from the point about directors, the hon. Gentleman referred to the system of our law. I might mention to him that the Prevention of Corruption Act 1916, Section (2) places a burden upon them to show that they were not guilty. That is a most important Act, but there are other cases in the criminal law in which a defendant is required to show that he is not guilty of the offence with which he is charged, so that it is quite inaccurate to say that it is anything like the universal rule of law that the onus of proof rests upon the prosecution.
    Mr. H. Roberts: May I interrupt? I should be very glad, if there is a whole series, of Statutes, as the learned Solicitor-General says, to hear what they are, so that I may look them up at my leisure. I have my doubts.
    .30 p.m.
    The Solicitor-General: The hon. Gentleman is really unduly suspicious of me. Had he allowed me a few more minutes, I would have stated each and every one on which I rely. I intend to do so now. I have mentioned the Prevention of Corruption Act, 1916, and I will now give a list of the others in sequence. The first one is the Representation of the People Act, 1918. I am taking a series spread over 30 years. Section 34 (4) of that Act as amended by the Representation of the People (No. 2) Act, 1922, says:
    "Where the person guilty of an offence against this Section is a body of persons corporate or unincorporate, every director or officer of that body shall, unless he proves that the act constituting the offence was committed without his knowledge or consent, be guilty of the like offence."
    There are similar provisions in the Dangerous Drugs Act, 1920, Section 13, (2, c)as amended by the Dangerous Drugs Act, 1932. If the hon. Gentleman would like to verify that I am telling the truth, he should look up that Act. The next one is the Dentists Act, 1921, Section 5 (2). The next, the Treaties of Washington Act, 1922, Section 2 (2). Then comes the Theatrical Employers' Registration Act, 1925, Section 6 (3). There is the Betting and Lotteries Act, 1934, Section 29; the Public Health (London) Act, 1936, Section 248 (2); the Public Health Act, 1936, Section 195; the Building Societies Act, 1939, Section 15 (1); Ships and Aircraft (Transfer Restriction) Act, 1939, Section 5; Prices of Goods Act, 1939, Section 18, and then we get to the Coal Act, which was referred to. I am sure the most impartial listener will concede that that is an impressive list.
    Mr. Pickthorn: It is very difficult to follow this list. Could the hon. and learned Solicitor-General now give us the time period covered, first, the earliest date, and, second, the Section in the Prevention of Corruption Act which was the first to which he referred?
    The Solicitor-General: The earliest time covered was the Prevention of Corruption Act, 1916, Section 2. The first one

    499
    after that was 1918, and then I gave a selection spread over many years of administration and ending up in 1939, and then we followed on in 1946. So there is ample precedent. For example in the Prices of Goods Act, the words are:
    "Unless he proves that the contravention was committed without his consent or connivance and that he exercised all such diligence to prevent the contravention as he ought to have exercised having regard to the nature of his functions as a director or officer of that body and to all the circumstances."
    There we have almost an exact precedent for this particular Clause. Is it fair or is it accurate to say that this places a severe burden on directors? It does not really do so at all. Suppose a director in a large company is charged with one particular type of function in the company's life and is concerned with only one particular phase of it. He can perfectly well exculpate himself, supposing an offence is committed which is within the province of other employees or directors of the company. He is let out in the concluding words of the Clause if he can prove that it was committed without his consent or connivance.
    Then he has to prove that he exercised all such diligence to prevent the offence, having regard to the nature of his functions in that capacity and all the circumstances. If he can show that he was justified, that other people were doing his job and that he should not have been expected to meddle in the work of his colleagues and other employees of the company, then he escapes the liability of conviction. Therefore, it is really not true to say that it is a severe burden. The hon. Gentleman asked why we put directors under this responsibility. It is because we think that a director who assumes the responsibility which attaches to his appointment should be placed under a certain measure of responsibility to see that the company complies with the law.
    Mr. Pickthorn: Is he not under that responsibility already?
    The Solicitor-General: Not unless he is placed under it by virtue of a Clause drafted in this form. In general, we say that it is not sufficient that the company alone should be liable to prosecution, and that directors responsible for its activities should be under some measure of responsibility. But we have so phrased the Clause
    500
    that if they can show that they have behaved reasonably in the matter—and I think that is a fair summary of what the Clause does—they can escape liability. I submit that it is perfectly fair. It is no less and no more than fair. Therefore, I ask the House to reject this Amendment.
    Mr. Boyd-Carpenter: I am sure the House is very interested in the list of Acts containing a similar provision which the researches of the hon. and learned Solicitor-General have brought to light. It would be equally possible to bring out a long list of Acts in which no such provision has been contained. I do not think it is particularly helpful to debate the matter purely on the basis of two conflicting lists. Surely, the hon. and learned Solicitor-General will agree that the onus of establishing innocence should not be placed upon an accused person unless there is some really substantial public necessity for doing so. It is up to any Government putting forward such a proposal to show that the public need really requires some such provision.
    In the few minutes since the hon. and learned Solicitor-General gave us the benefit of his researches, I have not had the opportunity to go into the details of the Acts to which he referred, but it is apparent from the names of them that the great majority are Acts dealing with offences which are particularly difficult to prove. That is certainly so in the case of the Prevention of Corruption Act, because there, as the hon. and learned Solicitor-General I am sure will agree, one is dealing with matters the truth of which it is peculiarly difficult to establish. Therefore this House, in 1916, thought fit to transfer the onus of proof. If the basis is that this ought not be done unless compelling reason is shown for doing it, I think the House is entitled to hear a little about what that reason is. The hon. and learned Solicitor-General will recollect that in Committee this matter was discussed. He discussed it, rather on the lines he has done today, on the basis, "Well, it has been done frequently before; therefore, let us do it again." In the twenty-second days proceedings of the Committee, he said:
    "With regard to the second point, the hon. Member asked for a justification of putting the onus on the directors and persons in the position of directors It is the same justification which has been accepted by the House, for example, in the case of the Coal Act, and in

    501
    other Statutes It is not a modern invention at all."—[OFFICIAL REPORT, Standing Committee E, Thursday, 15th May, 1947; c. 1044.]
    I submit that that is not good enough. If we are to be asked, for good and compelling public reasons, to transfer the onus, we are entitled to be told what those reasons are. The fact that it has been put into 20 other Acts is no reason for putting it into this Bill. We have not so far been told why it is necessary. The only approach to some such argument came in the concluding passages of the Solicitor-General's speech this afternoon. He said —and I think there was great force in it —that directors have considerable general responsibilities towards their companies from which they should not be allowed easily to escape. That argument might apply if the Clause, as it stands, dealt solely with directors, but it does not. The hon. and learned Gentleman kept referring to directors, but, in fact, the Clause refers to
    "a director, general manager, secretary or other similar officer."
    Therefore, if the Solicitor-General's argument on that point has weight, it has weight only with reference to directors, and it has not anything like the same weight with reference to general managers, still less to secretaries, and even less to similar officers, whoever they may be. The Solicitor-General brushed aside the burden which this Clause puts upon an accused person. The House will appreciate that the accused person must do two things. Once it has been proved that a company has committed an offence, he must prove:
    "that the offence was committed without his consent or connivance and that he exercised all such diligence to prevent the commission of the offence as he ought to have exercised having regard to the nature of his functions in that capacity and to all the circumstances."
    I ask the Solicitor-General, from his considerable experience in the courts, to appreciate that that is a heavy burden to discharge, that it may involve technical difficulties of proof which may be very hard to discharge, and it is not any light burden that he proposes to put upon these people. We have not been given any reason for this provision, except that it has been done before. When a man is brought up on a charge of housebreaking, it is no defence to prove 20 previous offences.
    Mr. Basil Nield: The answer advanced by the Solicitor-General to the proposed Amendment was twofold.
    502
    He said, first, that there was ample precedent for this sort of Clause, and secondly, that the burden on the accused is not very strict. I wish to say a few words in answer to each of those points. First, as to precedent, my hon. Friend the Member for Northwich (Mr. J. Foster) made it clear that there is ample precedent the other way, and that in many Statutes the onus rests upon the prosecution to prove that a director, or manager, or secretary is guilty of acting knowingly. The Solicitor-General has cited other enactments in which the onus is the other way. Let us, therefore, forget precedents.
    With regard to the Solicitor-General's point that the burden is not very strict, I suggest he is disregarding the real question of principle which is here involved. The position, as I understand it, is that if the Clause goes unamended, where a body corporate has committed an offence the secretary may at once be proceeded against, and he is then called upon to prove himself innocent of the offence. That offends against the primary rule in our criminal courts. It is no exaggeration to say that any reputation which our system has throughout the world, has among its first bases this rule, that no man may be convicted unless the prosecution prove that he is guilty. Every time this House invades that general principle, it does something very serious so far as the liberty of the subject is concerned. In this case 1 agree with my hon. Friend the Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) that no real reasons have been shown why there should be any departure from that vital rule of law which is largely responsible for the reputation which our system of justice possesses.
    6.45 p.m.
    Mr. H. Roberts: I am sorry the Solicitor-General should think that I am unduly suspicious or that I am challenging his accuracy. Nothing of the kind. My object in asking for a list is this. One has not only to look at a list of Statutes, but to look very carefully into the wording of every Statute to ascertain the reasons which induced Parliament from time to time to frame them in that way. If one looks at the Prevention of Corruption Act, one finds that unless there was a re-enacting Statute the initial reference was wrong. The date of the Prevention of Corruption Act was not

    503
    1916 but 1906, and it is notable that it was a very long time before that precedent was followed. Let us hope that the caution which was observed a generation ago will now be repeated.
    Sir Peter Bennett: I have studied very carefully the wording of the Clause. I am speaking as an ordinary director of an ordinary company. The hypothetical board meeting to which the Solicitor-General referred does not fit in with my experience of the way in which business is conducted, and if there were trouble or difficulty in my company I would much prefer to have to answer under the proposed new Subsection than the one which it is sought to delete. Today the handling of affairs is very complicated and difficult. Owing to the requirements of the law, directors are called upon to sign many documents, and the only way in which that can be done is by trusting somebody whose business it is to peruse them beforehand. One has to sign them entirely on the trust which one has in one's secretary or legal advisers. It would be much more just if we had the proposed new Subsection.
    I would remind the House of a story of a man who had to sign a great many documents. He was let down badly by one of his clerks who said, "I will get the old man to sign a document agreeing to shoot himself within a week," and he did. When a director has to sign a document he says to his secretary whom he has trusted for years. "Is this all right?" and if the secretary says, "Yes," the director signs it. Later on the director may be asked, "Did you sign a document agreeing to do all these things without having read it?" But I can assure the House that if a director were to read all the documents which are put in front of him to sign, he would never do anything else. Therefore, the proposed new Subsection fits in with the practical way in which affairs are carried on more than does the Subsection in the Bill. I support the Amendment because I believe justice would be more likely to be done if it were accepted and that injustice would easily happen under the present Subsection.
    Mr. Pickthorn: I hope that even now the Solicitor-General may think it possible to advise his right hon. Friend to
    504
    think again about this Amendment. I do not claim to be a lawyer but I have looked hastily at the first of the precedents the Solicitor-General gave us, and I will begin by saying that this surely is precisely the sort of point where a lawyer ought not to rely upon precedent. Where a principle is so strong and so long-established as the principle about the onus of proof in criminal cases, there surely, precedent ought not to be allowed to have any but the very slightest weight, we should surely on each new proposal approach that proposal with a strong prejudice in our minds against it. That is the first point I would raise.
    Secondly, with regard to the precedents the Solicitor-General quoted; for all his youth, I should have thought it was not fair for him to tell us that "there is nothing modern about it," and then to adduce precedents none of which go back before 1916. That is not very ancient history. We were already then in the epoch when war and socialism were uncontrollably producing each other and thus whittling down our civil liberties Incidentally, I would not for a moment compete in learning against him but I think there was an older precedent than his oldest. I have a faint recollection of my studies of criminal law and I thought there was a statutory provision shifting the onus of proof against persons found in possession of house-breaking tools after dark—in London and Birmingham, I think; I do not know why Birmingham I think that was the case. I do not quote it, as conclusive, but I hope to show that it is relevant to the argument. Now to come to the first instance which the Solicitor-General quoted, that is, the statute of 1916—and there, he said, was an exact precedent. But the precedent is extremely inexact.
    The Solicitor-General: I did not say it was a precedent for this Clause 1 quoted that as an instance of an invasion of what has been described by the hon. Gentleman as a chief principle of English law, that the onus was on the prosecution. It is an exception to that principle. The other cases I quoted were precedents, in one form or another for this Bill.
    Mr. Pickthorn: I apologise for any inaccuracy, and I hope that the hon. and learned Gentleman will do me the justice of believing that I had no intention of

    505
    over stressing what he said. What he says now is, I think, sufficient for my argument. What he says is that the Statute of 1916 is a precedent, and if not exact at least persuasively close—a precedent for the reversal of onus of proof. That is what he says. I would submit that that is mistaken. It is not at all a close analogy: in Section 2 of the Statute of 1916 a condition precedent is provided to the reversal of the onus, is that there shall have been proof that money has been paid to an employee of the Government by some one seeking a contract. That has to be proved first; the reversal of the onus of proof in that case is on the point whether the purpose was or was not corrupt. But, first of all before that reversal takes place it is necessary for it to be proved, under the Act of 1916 it is necessary for it to be proved, that somebody is seeking a contract with a Government Department and has given money or money's worth to somebody employed in that Government or public body
    Now, that is a very different thing from anything that has been suggested here, where the thing to be proved first is a breach by a company of multifarious ministerial regulations, and I do say with proper respect for the Solicitor-General and for his advisers, that it really is not fair to the House that he should have quoted this Section as an analogy without full exposition and warning of the distinction being given to us. It is not only accidental or insignificant that there is a difference. I could not do more than look up one of the Statutes the hon. and learned Gentleman quoted. I think I have fairly given the gist of that one. But if we take the list of the other cases he quoted, I think it would not require very much imagination to guess why this kind of reversal of proof was permitted in connection with these kinds of subjects. Dangerous drugs, for instance were in the list he gave. First of all, nobody deals with dangerous drugs without knowing he is doing something special, that in dealing with dangerous drugs he has a particular responsibility, above what he feels most days. Drugs are things which people are aware have a close potential relation with acts of moral obliquity; and the fact that they are in the possession of A or B, or pass from A to B is strong circumstantial evidence. I am sorry that this argument is long, but I must do my best to make it clear, because I think the
    506
    matter is of immense importance, and if I cannot make a clear exposition short, I must put it fully. Drugs are a kind of special category. The same thing is true in the case of theatrical employers, and in the case of betting establishments, and I believe it true also in the case of the earlier Statute, and true of all the cases quoted, that we must be put on extreme caution by the nature of the act or material itself; these are cases where a very strong degree of presumption can be drawn from the circumstances.
    If, as in the earliest case, if my learning was right about the house-breaking tools —we find a man at three o'clock in the morning in a back street in Birmingham with a sack full of burglar's tools—there is a strong degree of presumption, and I believe that that has been generally true for each of these reversals of the onus hitherto. I do ask the House—and I should have hardly thought it necessary to ask any lawyer—to agree that even in these cases where the things concerned, where moral obliquity, actual or apprehensible, or where circumstantial evidence elements are strong, even in such cases the House ought to be extremely reluctant o extend this practice. Here we are being asked to extend this transfer of the burden where there is no characterisation by the elements which I have ventured to indicate. It is not only for breaches of the Clause preceding that now before the House that the onus of proof is being shifted, but it is in connection with any kind of delinquency against ministerial regulations under this Bill; and I make bold to say that not many Members of the House realise how immensely wide that category of punishable actions that may be. I do beg the House to believe that unless it can be proved that this is absolutely necessary for the administration of this system, we should insist that it really is an interference with the principles of the English law, and the ordinary liberties of Englishmen, which the House has no justification whatever in permitting to the Government.
    Mr. Beechman: Although this discussion has gone on for some time, I feel I ought to take a few moments to say something about this matter, because we are faced with a principle of the utmost moment. Those of us who have taken examinations in criminal law will remember—I am afraid that, as far as I

    507
    am concerned, it was some little time ago —and I have no doubt at all that the learned Solicitor-General will well remember, that one of the stock questions to be expected or feared, was, "Name the cases in which the defendant is divested of the protection of the onus of proof in a prosecution." I can recollect that one went on to list, if one had studied one's books, the case of the house-breaking act to which my hon. Friend the Senior Burgess for Cambridge University (Mr. Pickthorn) has referred; and another to which the hon. and learned Gentleman has not referred, the case in which there is a prosecution of somebody for serving liquor to a young person.
    These instances were all an innovation quite recently, and they were brought into our law for special protection of the community, so we were taught, in cases where the crime was a very serious one, and where there was a special measure of responsibility; and, finally and most importantly, where it was very difficult for the prosecution to make out its case. Thus, in the case of serving drink to a person under age, it would be very difficult for the prosecution to show that the person serving the drink knew the age of the person who took the drink; and it was very necessary to protect young people from having liquor. In these circumstances I say that the precedents which the hon. and learned Solicitor-General has cited are no precedents at all. They are simply instances of well known exceptions which should not be
    followed as precedents if we are to maintain the protection which we have had in regard to personal liberty in this country.
    7.0 p.m.
    There is yet another clear innovation in this Clause, and it has been referred to by the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter). Here the defendant, having lost the protection of the onus of proof, has got to show that he did not consent or connive, and that he took reasonable care. It has never been thought necessary, in my recollection, that one should have to show that one had taken reasonable care in a case where fraud is charged, where it is sufficient to show that one had not been reckless. The result of this will be that a secretary, a manager, or a director, having been given some figures by an accountant, and having perhaps not had the time or the necessary documents to investigate the figures fully, will be told that he has not taken reasonable care, and will be thereby convicted of fraud in a manner which, as far as I know, has never obtained in this country before. I say that the learned Solicitor-General is making history, and bad history at that. History is one of the lew things we can still make without a licence; we give him no licence to rob us of this protecton of our civil liberties.
    Question put, "That the words proposed to be left out stand part of the Bill."
    The House divided: Ayes, 276;Noes, 111.

    Division No. 285.]

    AYES.

    7.2 p.m

    Adams, Richard (Balham)

    Bowles, F. G. (Nuneaton)

    Cove, W. G.

    Adams, W. T. (Hammersmith, South)

    Braddock, Mrs. E. M. (L'pl. Exch'ge)

    Crossman, R. H. S.

    Allen, A. C. (Bosworth)

    Braddock, T. (Mitcham)

    Daggar, G

    Alpass, J. H.

    Brook, D (Halifax)

    Daines, P.

    Anderson, A. (Motherwell)

    Brooks, T J (Rothwell)

    Davies, Edward (Burslem)

    Anderson, F. (Whitehaven)

    Brown, George (Belper)

    Davies, Ernest (Enfield)

    Attewell, H. C.

    Brown, T. J (Ince)

    Davies, Harold (Leek)

    Austin, H. Lewis

    Bruce, Maj. D W T

    Davies, Hadyn (St. Pancras, S.W.)

    Awbery, S. S.

    Buchanan, G

    Davies, R. J (Westhoughton)

    Ayles, W. H.

    Burke, W. A

    Davies, S. O (Merthyr)

    Ayrton Gould, Mrs. B

    Carmichael, James

    Deer, G.

    Bacon, Miss A.

    Castle, Mrs B. A

    de Freitas, Geoffrey

    Balfour, A.

    Chamberlain. R. A

    Delargy, H. J.

    Barstow, P. G.

    Champion, A J

    Diamond, J.

    Battley, J. R.

    Chater, D

    Dodds, N N

    Beattie, J (Belfast, W.)

    Chetwynd, G. R

    Donovan, T

    Bechervaise, A. E

    Cluse, W. S

    Driberg, T E N

    Belcher, J. W

    Cobb, F. A.

    Dumpleton, C W.

    Berson, G

    Cocks, F. S.

    Durbin, E. F. M

    Berry, H.

    Collindridge, F.

    Edwards, Rt Hon. Sir C. (Bedwellty)

    Beswick, F.

    Collins, V J.

    Edwards, N. (Caerphilly)

    Binns, J.

    Colman, Miss G. M.

    Edwards, W. J (Whitechapel)

    Blenkinsop, A.

    Comyns, Dr L

    Evans, E. (Lowestoft)

    Blyton, W. R.

    Corlett, Dr. J.

    Evans, John (Ogmore)

    Bowdon, Flg.-Offr. H. W

    Corvedale, Viscount

    Evans, S. N. (Wednesbury)

    Ewart, R.

    McEntee, V. La T.

    scollan, I

    Fairhurst, F

    McGhee, H G

    Scott-Elliot, W

    Farthing, W. J

    McKay, J (Wallsend)

    Shackleton, E. A.

    Fletcher, E. G. M. (Islington, E.)

    Mackay, R. W. G. (Hull, N.W.)

    Sharp, Granville

    Follick, M.

    McKinlay, A S.

    Shinwell Rt Hon. E

    Foot, M M

    Maclean, N (Govan)

    Silverman, J. (Erdington)

    Forman, J. C.

    McLeavy, F

    Smmons, C J

    Gaitskell, H. T.

    Macpherson. T. (Romford)

    Skeffington, A. M

    Gallacher, W.

    Mainwaring, W H

    Skinnard, F. W.

    Ganley, Mrs C. S

    Mallalieu, J P W

    Smith, C (Colchester)

    Gibbins, J.

    Mann, Mrs. J

    Smith, H. N (Nottingham, S.)

    Gibson, C. W

    Manning, C. (Camberwell, N.)

    Smith, S. H (Hull S.W.)

    Gilzean, A.

    Manning, Mrs. L. (Epping)

    Snow, Capt J W

    Glanville, J. E. (Consett)

    Marquand, H A

    Solley, L. J

    Goodrich, H. E.

    Mathers, G.

    Sorensen, R. W.

    Gordon-Walker, P. C.

    Medland, H. M

    Soskice, Maj Sir F

    Greenwood, A. W. J. (Heywood)

    Mellish, R. J

    Stamford, W.

    Grenfell, D. R

    Messer, F.

    Steele, T

    Grey, C. F.

    Middleton, Mrs. L.

    Stephen, C.

    Grierson, E

    Millington, Wing-Comdr. E. R

    Stewart, Michael (Fulham, E.)

    Griffiths, D. (Rother Valley)

    Mitchison, G R

    Strauss, G R. (Lambeth, N.)

    Griffiths, W D. (Moss Side)

    Monslow, W.

    Stobbs. A. E

    Guy, W H

    Moody, A S

    Swingler, S.

    Haire, John E (Wycombe)

    Morgan, Dr. H. B.

    Sylvester, G. C

    Hale, Leslie

    Morley, R.

    Symonds A. L.

    Hall, W. G.

    Morris, Lt.-Col. H. (Sheffield, C.)

    Taylor, H B (Mansfield)

    Hamilton, Lieut.-Col. R.

    Morris, P. (Swansea, W.)

    Taylor, R, J. (Morpeth)

    Hardy, E. A.

    Moyle, A

    Taylor, Dr S. (Barnet)

    Harrison, J.

    Mulvey, A.

    Thomas, D E. (Aberdare)

    Hastings, Dr. Somerville

    Murray, J. D

    Thomas, George (Cardiff)

    Haworth, J.

    Nally, W.

    Thomson, Rt Hon. G R. (Ed'b'gh, E.)

    Herbison, Miss M

    Naylor, T. E.

    Thorneycroft, Harry (Clayton)

    Hewitson, Capt- M

    Neal, H. (Claycross)

    Thurtle Ernest

    Hicks G

    Nichol, Mrs M E. (Bradford, N.)

    Tiffany, S

    Holman, P.

    Nicholls, H. R. (Stratford)

    Timmons, J.

    Holmes, H E. (Hemsworth)

    Noel-Baker, Capt. F E (Brentford)

    Titterington, M. P

    Hoy, J.

    Noel-Buxton, Ladv

    Tolley, L.

    Hudson, J. H. (Ealing W.)

    Cldfield, W. H.

    Turner-Samuels, M

    Hughes, Hector (Aberdeen, N.)

    Oliver, G H.

    Vernon, Maj. W F

    Hughes, H. D. (Wolverhampton, W.)

    Orbach, M.

    Viant, S. P.

    Hynd, H. (Hackney, C.)

    Paling, Rt. Hon. Wilfred (Wentworth)

    Walker, G. H

    Irving, W. J.

    Paling, Will T. (Dewsbury)

    Wallace, G. D. (Chislehurst)

    Janner, B.

    Palmer, A. M F

    Wallace, H W. (Walthamstow, E.)

    Jeger, G. (Winchester)

    Parker, J.

    Warbey, W. N.

    Jeger, Dr S. W (St. Pancras, S.E.)

    Parkin, B T

    Watkins, T. E.

    John, W

    Paton, J. (Norwich)

    Watson, W. M.

    Jones. D T (Hartlepools)

    Pearson, A

    Webb, M (Bradford, C.)

    Jones, J H. (Bolton)

    Peart, Thomas F.

    Wells P. L (Faversham)

    Jones, P. Asterley (Hitchin)

    Piratin, P.

    West, D. G.

    Keenan, W.

    Poole, Major Cecil (Lichfield)

    White, H. (Derbyshire, N.E.)

    Whiteley, Rt. Hon. W.

    King, E. M.

    Popplewell, E

    Wigg, Col. G E.

    Kinghorn, Sqn.-Ldr. E

    Porter, G. (Leeds)

    Wilkes, L

    Kinley, J.

    Proctor, W. T

    Wilkins, W. A.

    Kirby, B V

    Pryde, D. J.

    Willey, F. T. (Sunderland)

    Lang, G.

    Pursey, Cmdr. H.

    Willey, O G (Cleveland)

    Lavers, S.

    Randall, H E

    Williams, J. L. (Kelvingrove)

    Lee, F (Hulme)

    Ranger, J

    Williams, Rt. Hon. T. (Don Valley)

    Leslie, J R.

    Rees-Williams, D. Ft

    Williams, W. R- (Heston)

    Lever, N H

    Reeves, J.

    Williamson, T.

    Levy, B. W

    Reid T, (Swindon)

    Wills, Mrs. E. A.

    Lewis, A. W. J. (Upton)

    Rhodes, H

    Wyatt, W.

    Lindgren, G. S.

    Ridealgh, Mrs. M

    Yates, V. F.

    Lipton, Lt.-Col M

    Poberts, Goronwy (Caernarvonshire)

    Young, Sir R, (Newton)

    Logan, D G

    Robertson, J. J (Berwick)

    Zilliacus, K.

    Longden, F.

    Rogers, G. H. R

    Lyne, A. W.

    Ross, William (Kilmarnock)

    TELLERS FOR THE AYES:

    McAdam, W.

    Royle, C

    Mr. Joseph Henderson ano

    McAllister, G.

    Sargood, R

    Mr. Hannan.

    NOES.

    Amory, D. Heathcoat

    Buchan-Hepburn, P G T

    Dower, E. L. G. (Caithness)

    Assheton, Rt. Hon. R.

    Bullock Capt M

    Drayson, G. B

    Astor, Hon. M.

    Butcher, H. W

    Drewe, C.

    Baldwin, A. E.

    Challen, C

    Eccles, D, M.

    Barlow, Sir J.

    Clarke, Col. R. S

    Eden, Rt Hon. A.

    Beechman, N. A.

    Clifton-Brown, Lt.-Col. G.

    Elliot, Rt. Hon. Walter

    Bennett, Sir P.

    Crosthwaite-Eyre, Col O E

    Fletcher, W (Bury)

    Boies,-Lt.-Col. D, C (Wells

    Crowder, Capt. John E

    Foster, J. G (Northwich)

    Bossom, A. C.

    Cuthbert, W N

    Fraser, H, C. P. (Stone)

    Bower, N.

    Davies, Clement (Montgomery)

    Fraser, Sir I (Lonsdale)

    Boyd-Carpenter, J. A.

    Digby, S. W

    Fyfe, Rt. Hon. Sir D P M

    Bracken, Rt. Hon. Brendan

    Dodds-Parker, A. D

    Gage, C.

    Braithwaite, Lt.-Comdr. J. G

    Donner, Sqn.-Ldr. P W

    George, Maj Rt. Hn G Lloyd (P'ke)

    510

    511

    Gridley, Sir A.

    MacLeod, J

    Raikes, H V

    Gruffydd, Prof. W J

    Macmillan, Rt Hon Harold (Bromley)

    Reid, Rt Hon. J S C (Hillhead)

    Hannon, Sir P. (Moseley)

    Macpherson, N. (Dumfries)

    Roberts, Emrys (Merioneth)

    Haughton, S G

    Maitland, Comdr. J W

    Roberts, H (Handsworth)

    Headlam, Lieut.-Col Rt Hon. Sir C

    Marlowe, A. A. H.

    Ropner, Co, L

    Hogg, Hon Q

    Marshall, D (Bodmin)

    Ross Sir R D (Londonderry)

    Hollis, M. C.

    Marshall, S. H (Sutton)

    Scott, Lord W

    Hudson, Rt. Hon. R S (Southport)

    Mellor, Sir J

    Shepherd, W S. (Bucklow)

    Hurd, A.

    Molson, A H E.

    Smiles, Lt.-Col. Sir W

    Hutchison, Lt.-Cm. Clark (E'b'rgh W.)

    Morris, Hopkin (Carmarthen)

    Spearman, A. C M

    Hutchison, Col. J. R. (Glasgow, C.)

    Morris-Jones, Sir H

    Spence, H R.

    Jarvis, Sir J.

    Morrison, Rt Hon W S (Cirencester)

    Stanley, Rt. Hon. O

    Jeffreys, General Sir G.

    Mott-Radclyffe, C E

    Studholme, H. G

    Kendall, W D.

    Neven-Spence, Sir B

    Sutcliffe, H.

    Lancaster, Col. C G

    Nield, B. (Chester)

    Taylor C S (Eastbourne)

    Langford-Holt, J.

    Noble, Comdr. A. H. P.

    Thorneycroft, G. E P (Monmouth)

    Law, Rt Hon. R. K

    Nutting, Anthony

    Thornton-Kemsley, C N

    Legge-Bourke Maj E. A. H

    O Neill, Rt Hon Sir H

    Thorp, Lt.-Col. RAF

    Lindsay, M (Solihull)

    Osborne, C.

    Touche, G. C.

    Linstead, H N

    Peto, Brig. C. H. M.

    Wakefield, Sir W. W.

    Lipson, D L

    Pickthorn, K

    White, J B. (Canterbury)

    Lucas-Tooth, Sir H

    Ponsonby, Col. C. E

    Winterton, Rt. Hon. Earl

    Lyttelton, Rt. Hon. 0

    Prescott, Stanley

    York, C

    MacAndrew, Col. Sir C

    Price-White, Lt.-Col. D,

    Macdonald, Sir P (I of Wight)

    Prior-Palmer, Brig. O.

    TELLERS FOR THE NOES:

    Major Conant and Major Ramsay.

    Question put, and agreed to.

    CLAUSE 56.—(Provisions as to regulations and orders.)
    Mr. J. S. C. Reid: I beg to move, in page 66, line 13, to leave out from "regulations," to "and." in line 14.
    I think that it would be for the convenience of the House if we discussed together this Amendment and the Amendments, in line 17, to leave out from "provision," to "for," in line 18; and, in line 19, to leave out from "heard," to "of."
    The purpose of Clause 56 is to give power to make regulations with regard to the determination of questions of fact and of law. I do not think anyone objects to matters of this kind being put in regulations, provided we are sure that the necessary minima for the proper administration of justice are safeguarded. I have some doubt, when it comes to the third Amendment, whether it is proper to deal with court proceedings in regulations in connection with an electricity Bill. I should have thought that court proceedings ought to be dealt with in the ordinary way by rules of court, and that if it were necessary to make any additions or modifications to what is in any Statute, it ought not to be done by the Minister of Fuel and Power, but by rules of court. I hope, whatever' the Solicitor-General is willing or unwilling to concede, that he will, at least, take out all reference to court proceedings in line 19.
    The first point to which we take exception is leaving to regulations the determination of what is or what is not evidence. I see no objection, personally, to
    512
    regulations being allowed to admit as evidence something which is not evidence in the strict sense. I am expressing a purely personal view here, when I say that I take the view that the rules of evidence in our courts are perhaps a little bit too strict, and that it would not do much harm if they were slightly relaxed, although that relaxation must be of a very limited character. Any relaxation would come better from some kind of legal body or by rules of court, than from some rules made by the Minister of Fuel and Power. As the relaxation would in any event be somewhat minor, I doubt whether it is worth while introducing that here—I have an open mind about it. I am sure, however, that there ought to be no powers to rule out something that would be evidence under our ordinary rules.
    As I understand it, this Clause would allow regulations to exclude something which would otherwise be good legal evidence, and that we must resist. Therefore, I put my case on the first Amendment in this way: there should be no provision in the Bill for excluding legal evidence, but if there were a properly circumscribed and safeguarded provision for the inclusion of something not strictly legal evidence, I would not be seriously disturbed, although, as I have said, I doubt whether this is the way to do it.
    7.15 p.m.
    I come to the question raised by the second Amendment. The Clause refers to matters relating
    "to the practice and procedure to be followed in connection with the determination of such questions, including provision as to parties and their representation."

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    I do not understand what is meant by the provisions as to "parties." Is it intended that the regulations should exclude someone from appearing, although that person would have title and interest under ordinary legal conceptions? If that is intended, it raises a very serious question of principle. I cannot think that the regulations are intended to let in people as parties to these proceedings who do not have title. I cannot understand why that should be done. I am puzzled why the word "parties" is in this Clause at all.
    I see the Lord Advocate sitting opposite. It may be that something arises where the Crown ought to be represented. In Scotland, the Lord Advocate has a universal obligation to represent the Crown, but it may be that in England there is not quite the same distinction about the particular person who represents the Crown. If it means that although, under ordinary law, one officer would represent the Crown, but here it would be more convenient for another to do so, that does not raise any question of principle; but if the word "parties" means not the Crown but the subject, whether the subject be a company or a person, I cannot understand why the regulations should include this provision.
    I now come to representation. I see no serious objection to extending the class of persons who can represent litigants in the ordinary courts. I do not think it is a good thing. I do not think it is cheaper, or that it shortens the proceedings to allow representation by lay people not so accustomed to presenting cases in court as trained lawyers. As a member of the legal profession, I should not like to appear emphatic on that. If the intention is that someone other than a lawyer should be allowed, in certain classes of cases, to represent the litigants, although I think it is probably unwise, I should not feel bound to object too much. Events would probably show that it was unwise, and the next time this sort of thing came up for discussion it might be said "Look what happened. It did not work very well. It is not a very good thing."
    But if the word "representation" here means something more than that, if it means that the regulations will be allowed to prevent lawyers from representing litigants, then it raises a very serious ques-
    514
    tion, one which we would have to fight to the uttermost. I know there are cases where legal representation is forbidden, and I think it is a pity. I have a little experience of how these things work, and I believe that, on balance, it is found that in cases where legal representation is forbidden the work does not proceed so smoothly, and justice is not so adequately done. The only possible justification for forbidding legal representation is in a case of such small magnitude that it is thought to be out of scale that a lawyer's fee should be paid. Even there, sometimes much more is involved than the actual sum at stake. But that cannot apply here. On the face of it, this Clause entitles the Minister to say that in a certain class of case a certain type of lawyer shall not be allowed to attend. As this raises a question of principle, I hope the Solicitor-General will agree at least to qualify this wholly unnecessary word. If the intention is that in certain cases a wider range of representation is to be permitted, than would be permitted in a court of law, I think it is unwise but I should not fight to the death on it. But if that is the intention it should be made clear that the narrowing of representation is not permitted to the regulations.
    I come to my next and last point, to the words
    "…for the right to appear and be heard (as well in court proceedings as otherwise)…"
    I feel sure that these words have got into the Bill under a misapprehension. I cannot believe that it is the intention of the Government, either to say that in court proceedings certain persons who could otherwise appear shall not appear, or that in those proceedings certain persons who would not be qualified to appear shall be qualified for the purpose of these proceedings. I hope that is not the intention, and I shall listen with interest to anything which the Solicitor-General has to say on this matter. I should say that these words are wholly unjustified. Whatever the hon. and learned Gentleman may see fit to do in the way of only partial acceptance of the first two of these Amendments, he ought to accept the third Amendment without qualification.
    The Solicitor-General: I want, if I can, to try to meet the right hon. and learned Gentleman's objections and, first, I would like to consider the three phrases to which he has called attention. With regard to

    515
    the phrase, "as to the evidence for that purpose," the kind of thing we had in mind was, for example, tendering affidavit evidence of a fact which would otherwise have to be proved by viva voce evidence. The right hon. and learned Gentleman asked whether, within the scope of the words which have been used, it would not be possible for the Government to exclude what would otherwise be relevant evidence, or evidence directly bearing on the issue. Looking at those words, I do not think they are very satisfactory. The sort of words which we think would probably carry out our object more precisely would be "as to the mode of proof," or something of that sort. We would, however, like to consider the present words a little more closely.
    With regard to the question of representation and parties, technically, of course, in the case of the courts which are to be set up under the Bill, arbitration courts and so on, if there is no power to enable parties to appear by representatives they would have to appear without representation and state their case. The sort of contingency we had in mind was to enable them to appear by representatives who might be the most suitable in a particular case. Generally, legal representatives would be most suitable, but it occurred to us that in some cases it might be most convenient for all parties to appear by an accountant. In matters dealing with valuation and so on, that might be the most convenient procedure. I do not want to bind myself, at this stage, to any expression of intention, but we desire to take power to enable parties to appear by an accountant if they want to do so, or if it is thought suitable that they should do so in the circumstances of the case.
    With regard to the right hon. and learned Gentleman's third point, his criticism of the words is limited to "the right of the Minister or other authorities to appear." The Subsection reads:
    "…for the right to appear and be heard…"
    Then there come the words to which he takes exception, followed by
    "…the Minister or other authorities…"
    We do not seek to take power to interfere with the right of any other person to be heard. We desire power to enable the Minister, in matters in which he is
    516
    directly concerned, to appear and to be heard. With respect to the right hon. and learned Gentleman, I do not think that that is unreasonable. There may be cases in which the Minister's interest is directly affected, and in which he ought to appear. Here, again, we would like to look at the words to see whether they are not going too far, and I ask the right hon. and learned Gentleman not to press me further for an expression of intention as to the exact form the regulations are to take. These words are enabling words. I concede that the first set of words, which relate to evidence, would empower the Minister to do something which he has no desire to do, and which he ought not to have power to do, and as for the other two sets of words we would like to consider what the right hon. and learned Gentleman has said between now and a later stage of the Bill.
    Mr. J. S. C. Reid: The Solicitor-General has met the points I raised very fairly, and I would only make this further point about the third Amendment. I am not quite sure whether the hon. and learned Gentleman meant that there was to be power to allow the Minister to appear in a case where, otherwise, the Government would have no right to appear. If he does mean that I would ask him to reconsider the matter, because I have grave doubt about power to allow somebody to appear in court in a case where, according to the ordinary conception of justice, he has no right, title, or interest to appear. I should have thought that that would have applied to Ministers as to other people. I would ask the learned Solicitor-General, if that was what he meant, to think about it again. As he is to re-examine the whole subject, I beg to ask leave to withdraw the Amendment, and I will not proceed to move the following two Amendments on the Paper.
    Amendment, by leave, withdrawn.

    CLAUSE 59.—(Interpretation.)
    7.30 p.m.
    The Solicitor-General: I beg to move, in page 68, line 22, at the end, to insert:
    "'employed' means employed as an officer and 'employment' shall be construed accordingly."
    During the Committee stage, attention was drawn to the fact that the definition of an employed person is not in its correct place alphabetically in Clause 59. This

    517
    Amendment seeks to take it out of the paragraph which begins with the word "officer," at the bottom of page 69, and to put it definitely in its correct place alphabetically in the list of definitions on page 68.
    Amendment agreed to.
    The Solicitor-General: I beg to move, in page 69, line 36, after "capital," to insert "and proper provision."
    This and the following Amendment— in line 36, to leave out "and obsolescence "—hang together. They are purely consequential on the Amendment to Clause 40 which was considered yesterday.
    Colonel Clarke: They may be conseqential, but I think that some comment should be made on them. With regard to the first Amendment—after "capital" to insert "and proper provision "—I agree that that is an' improvement, but it is a matter of opinion as to what the word "proper" means. I cannot help feeling that the Solicitor-General will agree with that. This does call attention to the fact that there is a very real need for some valuation of assets, because this cannot be carried out without some valuation of assets. The Amendment is to insert, after "capital," "and proper provision" and the paragraph reads on: for depreciation and obsolescence." It is impossible to do that unless one knows the value of what one is taking over, which is not known, and the Government, refused to accept our Amendment, which suggested that a valuation should be made in the first two years.
    Amendment agreed to.
    Further Amendment made: In line 36, to leave out, "and obsolescence."
    In line 50, to leave out from "servant," to the end of line 51.— [The Solicitor-General.]
    Colonel Clarke: I beg to move, in page 70, line 29, to leave out "stock, debentures and," and to insert "or stock other than."
    This is a matter which has been debated before and I do not want to go over old ground, but there is a great difference between hon. Members and right hon. Members on this side of the House and hon. Members and right hon. Members on the other side of the
    518
    House as to the distinction between ordinary and preference shares and debentures. On the other side of the House, hon. Members are of the opinion that there is virtually no difference between them. On this side, we believe that there is a very great difference. We believe that debentures are really debts and not in any way the same thing as the equity of a company. I cannot understand the difficulty that there seems to be in distinguishing them. It appears to me to be clear that a debenture is a first charge on the assets of the company. If the company is wound up, the first thing that has to be done is to pay off the debenture holders. They have to be paid off, as a rule, in cash according to the terms in the document that created the charge on the company.
    During the Debate upstairs the Parliamentary Secretary said:
    "We regard debentures as marketable securities, dealt with and quoted on the Stock Exchange in exactly the same way as other stocks and shares."—[OFFICIAL REPORT, Standing Committee E, 15th May, 1947; c. 1055.]
    I would agree with him that that is so, as long as the company on which the debentures were raised is still in existence. Then they are marketable, the same as mortgages are marketable, but directly the company on which those debentures were raised or secured goes out of existence, it appears that the debentures are no longer marketable. It seems to me that just as debentures are the first charge to be paid off on liquidation they should be paid off now on nationalisation. The difference between equity shareholders and debenture shareholders is shown by the fact that debenture holders have to have trustees to protect their interests. Again there is the word "foreclosure" associated with debenture holders—suggesting quite a different relationship with the company to that of equity shareholders. From the shareholder's point of view the debenture holder does not think of himself as part of a company in the sense that the equity holder does. He looks on himself as having a charge on the assets. Lastly, I suggest that the prejudice which exists against companies holding their own debentures is' evidence that the two classes of security are quite different. For all those reasons, I want to make this last

    519
    appeal for debentures and the other stock —preference and ordinary stock—to be treated as something different. I am certain that they are, but the Solicitor-General appears to think that they are exactly on the same basis.
    Colonel Crosthwaite-Eyre: I beg to second the Amendment.
    We on this side of the House consider for two reasons that the acceptance by the Government of this Amendment is essential. In the first place, while the Clause stands as it is now, one of the fundamental principles of commercial practice will be transgressed by the Government, and the other reason is that this distinction as it stands is unworkable and will lead to endless litigation, to endless questions of interpretation, and will do no good either to the case the Government are trying to make or to the people who have invested in this form of security. The fundamental principle involved is this. Whereas stocks and shares are the holdings of people who are partners in the company, debenture holders are creditors of the company. The two situations are, therefore, entirely distinct and different, and there is no comparison between the shareholder and the debenture holder. One holds a stake in the company and the other is a creditor of the company. We discussed this at some length in Committee, and I do not wish to weary the House again with those arguments. Indeed, they were accepted by the Government; I would only quote the Parliamentary Secretary to the Ministry of Fuel and Power, who stated:
    "I do not think we can possibly contest the fact that, in a formal legal sense there is a distinction between a debenture and an equity share; that is to say, a debenture is a loan from some person, in the formal legal sense to the company, whereas the equity share is part of the ownership of the company."— [OFFICIAL REPORT, Standing Committee E, 20th May, 1947; c. 1059.]
    That is quite sufficient to show this distinction, and the essential basis on which we again raise this matter. If once the Government say that in any plan of nationalisation they are going to repudiate the debts entered into by a company the whole of their position seems to me to be untenable. In fact, in this Bill the Government have taken great care, except in this one respect, to safeguard the position of the companies' creditors. There-
    520
    fore, the first question we would ask the Government is, why this distinction? How can they, if they are sincere in what they have done in the rest of the Bill, make this differentiation on this point? For what reason do they say that they will acknowledge all the creditors of the company except the debenture holders— who are equally creditors—and whom they are going to abandon? That question needs very considerable thought by hon. Members opposite. And I hope that whoever is to reply will have something rather more convincing to say than had the Parliamentary Secretary in Committee, because the only statement he made was:
    "We regard debentures as marketable securities…"—[OFFICIAL REPORT, Standing Committee E,15th May, 1947; c 1055.]
    I think I am right in saying that. I have been through the speeches very carefully, and in. the whole of his rather complicated argument that was the only statement he made. He went on to say, when we tackled him further on this matter that mortgages were acknowledged as debts whereas debentures were not. He said that debentures were marketable securities and mortgages were not. In fact, as every hon. Member of this House knows, that is not true. In a large number of cases mortgages are equally marketable securities. As for instance was mentioned in the Committee, agricultural mortgages are in many cases freely marketable, and, therefore, the first aspect of his case falls to the ground.
    7.45 p.m.
    I would stress this also to hon. Members opposite. If they will look at the Schedule which sets out the companies whose assets are being taken over and whose debenture holders are being compensated in this way, they will find that 75 per cent. of the companies have no Stock Exchange quotations for their shares. It is, therefore, a safe assumption to say that at least 75 per cent. of the debentures which the Government wish to take over at the moment are not marketable securities in the sense that the Parliamentary Secretary used that phrase. Therefore, either from the point of view of distinguishing between debentures and mortgages, or from the point of view of the actual facts of what he said, neither of his arguments can be substantiated.

    521
    I ask the Parliamentary Secretary further, if he is making this distinction between debentures and mortgages, on what basis does he make it? It is a fact that the exact definition of the term "debenture" has baffled the law lords for a considerable time. There are many cases, as the hon. and learned Gentleman opposite knows far better than I do, in which the highest legal authorities in this country have been unable to state exactly what comprises a debenture. I think that will be more easily realised in the light of the fact that in any ordinary deed creating a debenture the term "mortgage" is always used, and a debenture can only be created where, as some part of the deal, a mortgage is created on the assets so as to guarantee that debenture. If that is so, how is it possible to distinguish between a mortgage and a debenture? As far as I can see the only answer we can receive is that where, by accident, the term "debenture" appears in a particular case, it is to be treated as a debenture, but where by accident, the word "mortgage" appears in a particular case, then it, is to be treated as a mortgage. If that is so, the case of the Government again falls to the ground, because they will be saying that a debt in the creation of which one word happens by chance to have been used is to be honoured, whereas a debt in the creation of which another word happens by chance to have been used is to be cast aside.
    Will the Solicitor-General tell us very clearly what definition of debenture he proposes to apply? There is none in existence at the moment, and if he intends to leave it as a matter of chance the Government will indeed stand convicted of a gross breach of trust. We on this side of the House have, obviously, an irreconcilable difference of opinion with hon. Members opposite about the principles of this Bill, but there is one thing which we have brought up time and time again during the last three days, and that is that the Government have trampled upon all the established practices of commercial law. [HON. MEMBERS: "Hear, hear."] Hon. Members opposite cheer. They would do well to think before they do so. Nobody is more keen than hon. and right hon. Members opposite to state that the success of this country depends on private enterprise and industrial reconstruction. Every time they disregard one of
    522
    these fundamental principles, every time they show that they have no regard for that which has been sanctioned by this country over a great many years, they make the alternative of "work or want" which faces this country less of an alternative and more of a certainty that the latter will hold.
    On this matter, one of very great importance, one which, as my hon. Friend said, has no political importance, we appeal to the Government to respect tradition. We appeal to them to respect the contracts which have been acknowledged throughout the long period of our commercial history. Above all, we appeal to them not to try to differentiate between two types of debt, identical in nature, in such a way that one type will be paid and the other disregarded. If they do not accept this principle, I cannot see what hope they have of convincing the country of the sincerity of their intentions.
    The Solicitor-General: I was not quite able to understand what this particular Amendment had to do with the question of merits as between a planned economy and a planless, chaotic economy. That mystery I shall have to leave locked in the bosom of the hon. and gallant Gentleman the Member for New Forest and Christchurch (Colonel Crosthwaite-Eyre) who advanced the argument, but so far as the Amendment is concerned I would say with the hon. and gallant Gentleman the Member for East Grinstead (Colonel Clarke), that there is not really very much to be added on either side to what has already been said. We take the view, for the purpose of compensation as between Clause 17 and Clause 13 (10) of this Bill, that debentures can fairly be said to come within the category of marketable securities. This has been said already and I simply repeat it.
    Colonel Crosthwaite-Eyre: It is quite true.
    The Solicitor-General: Looking at it through the eyes of the ordinary person who has money to invest I should have thought that, broadly speaking, he would consider what securities he could purchase in the stock market and would put them on one side, and that on the other side if he were minded to enter into an individual contract of loan to be secured by a mortgage, he would treat that as

    523
    an entirely different category of investment for his money. After all, one is an individual contract with individual incidence and individual liability as between borrower and the lender; the other, a debenture, is a security which has probably passed through a number of hands.
    Colonel Clarke: It may have passed through a number of hands, but the security on which it is based has always been the same. Now it is intended to change that. The security was on a certain company's assets; it is now to be on the Treasury. I do not want to be critical as to which is the more valuable, but the fact remains that the security is to be changed.
    The Solicitor-General: There are two kinds of security. One, as I say, is a security of which the terms are set out in an individual contract between the borrower and the lender—the ordinary mortgage. I quite accept the fact that one can purchase mortgages, but there is a limited and not an organised market for that purpose. There is no regularly quoted price for mortgages if one wants to buy them, but with regard to debentures that is not the case. One purchases debentures in the ordinary way on the Stock Exchange, and the prices are quoted, whereas in the case of an ordinary loan, generally speaking the creditor is the person who originally advanced the money, whereas in the majority of cases the person who is for the time being the holder of the debenture is a person who has purchased it from somebody who previously held it, and he has no relationship to the original lender of the money. It would be idle for me to controvert and useless to repeat the well-known differences between an ordinary quoted share and a debenture, but I am not suggesting that they are precisely parallel. In the one case the debenture holder is a creditor, usually with a charge, and in the other case he is a member of the company concerned.
    That has been said over and over again in the course of this present discussion, but broadly speaking the practical way of dealing with this point is to ask, "What can you say is a marketable security—a recognised Stock Exchange security—on the one side, and what must you class in a category apart from that
    524
    as a loan of money pursuant to an individual contract between a borrower and a lender?" The hon. and gallant Member for New Forest and Christchurch said that 75 per cent, of the companies in the Schedule had issued securities which were not quoted on the Stock Exchange. I am told, subject to verification, that 90 per cent. of the values of the securities issued by those companies set out in the Schedule are in fact quoted. Therefore, we are drawing the distinction between a marketable security on the one side and a personal individual debt on the other. I do not think that it would advance the Debate if I went on to repeat the arguments which have already been used, and which the hon. and gallant Member for East Grinstead very kindly ascribed to me, although the eloquence was really attributable to my hon. Friend the Parliamentary Secretary.
    Colonel Crosthwaite-Eyre: Before the hon. and learned Gentleman sits down, will he answer one question I put to him? How does he define the differentiation between a debenture and a mortgage?
    The Solicitor-General: It is not a definition but it is a term which is clearly understood and which is ordinarily easily distinguishable from the sort of mortgage which is a charge which secures a loan as between an individual borrower and lender.
    Mr. J. S. C. Reid: I must say that I am puzzled after hearing this argument because the definition drawn in the Bill —if it is drawn at all—is a distinction between a debenture and a mortgage upon the disposition of a security, whereas the distinction in the hon. and learned Gentleman's argument is between something quoted on the Stock Exchange and something not so quoted. I want Jo ask the hon. and learned Gentleman what is the position of something which, by any test, is quite clearly a debenture but is not quoted on the Stock Exchange. There must be such, and I want to know which class they come into—the class of security or that of debt. It is plain that the hon. and learned Gentleman's argument is directed entirely to those debentures—for all I know they may be 90 per cent. as has been suggested—which are quoted on the Stock Exchange. But supposing there are only 10 per cent. which are not quoted; how are they to be treated? I

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    am not arguing whether they ought to fall in one class or the other; I do not profess to have argued that out, but I am asking a straight question—into which class do the Government propose to put them?
    There are a great many persons interested in debentures for comparatively small sums who certainly ought not to be asked to go to lawyers to work out this puzzle. Somebody, for example, who has a debenture for £100, £200 or £300 from a small electricity company ought not to have a legal puzzle put in front of him when he wants to know into which class he is going to fall. He should be told. As I have said, I do not want to argue which class it should be, but to know which class he will in fact fall into under the Bill. I think he will fall into the debenture class, although I think it is intended that he should fall into the debt class. It seems to me that if this definition is to carry out the apparent intention of the Government it ought to be modified now or at a subsequent stage in the Bill. I hope that the hon. and learned Gentleman will tell us that he will modify the definition to bring it into line with the argument he has put forward.
    The Solicitor-General: If it comes within the definition of a security, then we have to look back at Clause 17. If the security in question does not come within Subsections (2), (3), (4) or (5), it falls to be valued under Subsection (7). Those that fall within Subsection (2) are those in respect of which there is a Stock Exchange quotation on particular dates.
    Amendment negatived.

    CLAUSE 60.—(Application to Scotland.)
    8.0 p.m.
    The Lord Advocate (Mr. G. R. Thomson): I beg to move, in page 71, line 4, at the end, to insert:
    "(2) For any reference to the Minister of Health there shall be substituted a reference to the Secretary of State."
    This is merely a drafting Amendment.
    Mr. R. S. Hudson: I think we are entitled to a more lucid and extensive definition than that of the Lord Advocate that this is merely a drafting Amendment.
    The Lord Advocate: Amendments have been made to Clauses 14 and 19, and, as amended, they make certain provisions refer to the Minister of Health. The
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    Minister of Health does not operate in Scotland, where the appropriate Minister is the Secretary of State for Scotland, and that is why the Amendment is necessary.
    Amendment agreed to.

    FIRST SCHEDULE.—(Area Electricity Boards.)
    Mr. Emrys Roberts: I beg to move, in page 73, line 2, to leave out from the beginning to the end of line 9, and to insert:

    "The Wales Electricity Board

    Anglesey, Brecknockshire. Caernarvonshire, Cardiganshire Carmarthenshire, Denbighshire, Flintshire, Glamorganshire, Merionethshire, Monmouthshire, Montgomeryshire, Pembrokeshire and Radnorshire.

    The Merseyside Electricity Board.

    Parts of Cheshire, Lancashire (including Liverpool) and Shropshire."

    The purpose of this Amendment is to have one electricty board for the whole of Wales in order that, as we believe, the benefits of public ownership can be more fully developed in that country. The White Paper on Electricity Supply Areas, Command Paper 7007, deals with the principles on which these area boards have been constituted, and states that it is highly desirable that they should be natural areas with a strong local outlook and local interest. The function of the area board is to distribute electricity. In fact, the words of the Bill are:
    "to plan and carry out an economic and efficient distribution of electricity within the area".
    The White Paper has considered the position of Wales and has come to the conclusion that because of technical difficulties which arise, it is more feasible to join up North Wales with Merseyside and establish South Wales as an area on its own. I do not wish to go into the technical questions, because I am not qualified to deal with them at any length, but I should like to submit some considerations to the Minister for having another look at this matter.
    First, I should like to put to him that Wales is a long way behind England in the development and distribution of electricity in the rural areas. On 8th April, 1946, I asked the Minister of Agriculture what percentage of the farms in England and Wales was equipped with

    527
    electricity from public mains. The answer was that whereas in England 27 per cent. of all farms have electricity, in Wales only 9 per cent. have it. The price is high, and because of the lack of electricity and other amenities in the rural areas there is a difficulty in attracting diversified industries and in making the most of our agricultural activities. That is a paradox in a land where hydroelectric resources are so plentiful in the North and coal resources so plentiful in the South.
    We welcome this Measure, because we think public ownership of electricity is a right step to take towards improving the conditions of the rural areas, and we quite naturally are entitled to ask how it will effect us in our own parts not in a nationalist spirit, but because we want to see the conditions of good life developed in Wales. I should like to submit arguments why, on balance, the considerations for treating Wales as a unit override the technical considerations which are apparent at first hand. The first argument of the Minister is that the main transmission lines run East and West, and to constitute Wales as a unit would mean running transmission lines over the mountains in order that they would proceed North and South. Having regard to the fact that the area board is not a generating authority like the Central Authority, but a distributing authority, I am not certain that that is a valid consideration, because the area board in any event will have to plan the installation of electricity and for taking the mains into the villages and towns. That may mean that the mains will have to go over the mountains, and, in fact, it has been done in recent years by the North West Power Company.
    I appeal to the Minister not to' be bound by the present set-up and lay-out of electrical distribution in North Wales, because naturally the present layout has been governed by those circumstances which so often govern private enterprise in distributing electricity. First of all, they want immediate and adequate returns on the money expended; and, secondly, they often tend to ask for a contribution of a proportion of the capital from the areas which they supply. The present lay-out is not perhaps an indication of what may be achieved under public ownership, and it would be wrong
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    to tie up the future of the planning of Wales in a certain way, because the transmission lines have been restricted by the considerations which I have mentioned.
    I want to come to what is, from the technical angle, a very strong argument. What is essential if this Bill is to succeed is that these area boards shall be live instruments and have a genuine impetus to plan within their areas. As I see it, one of the main requirements in Wales is for facilities for the rural areas. What I am much afraid of is that if North Wales is linked up with Merseyside, there will be a tendency to concentrate too much on the areas where the demand is heaviest, and not sufficient impetus to supply the rural areas which are not areas near Merseyside, but are in Mid-Wales, where electrification will necessarily operate very far from Merseyside. If the need for development exists in Mid-Wales, the consideration that it is technically necessary to tie up Wales with Merseyside does not arise. In this matter of planning the efficient distribution within an area, I do not think there is any real community of interest between North Wales and Merseyside, and I rather feel that if the whole of Wales were under one board there would be brought into that board a real interest and urge to plan together for the interests of Wales, and a sense of national responsibility would be brought to the job, and a pride in what might be achieved.
    It is interesting to note that only in 1942 the Welsh Reconstruction Advisory Council, a most authoritative and distinguished body, recommended the setting up of a Welsh Electrical Development organisation. If Wales is to be broken into two areas, it may be impossible to achieve that development for the Principality as a whole. Clause 7 sets up one consultative council for the area of. each area board. If we have the area boards which the Bill proposes, we shall not have one consultative council for the whole of Wales, nor anyone to express the Welsh point of view or the public opinion of Wales as a whole. From that point of view it is essential to have one area board.
    There is a wider consideration which I should like to mention. The expanding scope of nationalisation makes it very necessary to develop machinery which will break down excessive centralisation and avoid the dangers of bureaucracy, remote-

    529
    ness and impersonality, which are bound to be inherent in nationalisation on a big scale. We can only do that if our regional arrangements are of an order which will produce local interest and even local enthusiasm. In all these schemes there is a very valid argument for treating Wales as one unit. It is the argument which the Minister of Health accepted in the discussions upon the National Health Service Bill. I brought forward an Amendment and the Minister gave an assurance, which has now been carried out.
    Mr. Norman Smith: The Minister of Health is Welsh.
    Mr. Roberts: I am sure that the hon. Member who interrupted is not suggesting that the Minister of Health has been deflected from the true path because he is a Welshman. I* should say rather that the Minister had a wider vision. If a view is taken wider than that which involves only the present technical considerations, we shall release such national forces as will make the Bill in Wales the excellent Measure which it can become.
    Professor Gruffydd: I beg to second the Amendment.
    I do so because I am happy to be able to support what I think is a constructive Amendment, and secondly, because the excuse that the electricity transmission lines in Wales go from west to east rather than from north to south does not impress me in the least. We have suffered from that kind of excuse in Wales for a long time in many other respects besides electricity. Our electricity lines go from west to east because they have been constructed not to serve Wales but to serve England. Our railway lines run from west to east, our roads run from west to east for the same reason. The main object of the railways and of the roads, in the view of the Parliaments of the past, was, of course, to serve England and not to serve Wales. Now, having had imposed upon us transmission lines which run from west to east, we are told that we cannot have an area board in Wales just precisely because those transmission lines run from West to east. It is rather like the old custom—
    8.15 p.m.
    Colonel Clarke: On a point of Order, Mr. Deputy-Speaker. May I draw your
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    attention to the fact that there is not the requisite number of hon. Members in the House?
    Mr. Deputy-Speaker: That may or may not be true, but it is against the rule of the House to call a count between 7.30 and 8.30.
    Mr. Gallacher: Try it again. Look at the Tory benches.
    Professor Gruffydd: To advance that as an excuse for not giving us an area board in Wales is like what happened under old barbaric systems when a king who had cut out the eyes of his heir might say to him, "Now you cannot become king after me because you have no eyes." We have been deprived of the one advantage we ought to have had—of transmission lines running from North to South—and now because of that disadvantage we are not to be given an area board. Wales is par excellence a unit for an area board. It has the two essentials of an area board —inexhaustible coal and water power on the one hand, and very great industries on the other. The demand and the supply are there in the same country, and they should not be separated. It has often been said that our resources are used not for Wales itself but always for England. We have a rainfall which is greater than in any other part of Britain except for parts of Scotland, and we are not allowed to make our own use even of this. Our rainfall is collected not to serve us but to serve Birmingham and Liverpool. Whenever there is a new project for a water supply for a town in the North of England, the first source they think of is Wales. The same thing will happen if Merseyside is connected to Wales under the area board. That area board would function not for the sake of North Wales, but for Liverpool and Lancaster. We have suffered from that sort of thing in the past and we are likely to suffer in the same way in the future.
    I should like to cross the t's and dot the i's of one thing which has already been said by my hon. Friend the Member for Merioneth (Mr. Emrys Roberts). It is time this Parliament started protecting Wales from being divided against itself time after time by Bill after Bill. This will emphasise the worst division—the division between North Wales and South Wales. My hon. Friend said that he welcomes this Bill. All of us on the

    531
    Liberal benches welcome it: [HON. MEMBERS: "Both of you?"] There are more than two hon. Members in the Liberal Party as a matter of fact, and there are unfortunately a good many Tories in it outside the House. I was going to say that we welcome this Bill, but we realise that the impact of nationalisation on the national life in Wales will be immense— far greater than anything in the past. While we welcome the Government's plans for the nationalisation of different industries, we want to be assured that we can welcome them as a nation and not as two halves.
    Mr. Birch: The hon. Member for the University of Wales (Professor Gruffydd) has said that the impact of nationalisation on Wales is very great. What he has done is to swallow the camel of nationalisation but he is now trying to spit up the gnat, because what is now happening is the inevitable consequence of this Measure of nationalisation.
    Professor Gruffydd: May I suggest that the camel is more appropriately a concomitant of the needle's eye?
    Mr. Birch: I suggested the hon. Gentleman had swallowed the camel. Before this was brought in there was a great deal of local control of electricity supply but it was inevitable, when you get the nationalisation of the electricity industry, that what has happened under this Bill would happen. I think the hon. Gentleman has ignored the existence of the mountains in the middle of Wales. Once you accept nationalisation, you lose the local control you had before. If the Liberal Party had stuck to their principles, and not accepted nationalisation, they would not be in the awkward position they are in now.
    Mr. Gallacher: As a Scotsman who, in the near future, may be looking for allies, I am happy to support this Amendment and I would ask hon. Members to consider the principle involved in it. No matter how you play with it, the principle involved is the spirit of an ancient nation, a nation with a long and honourable tradition. Hon. Members opposite are not the least bit interested in the soul or the spirit of a nation. They are interested in hard cash. They are always "on the mooch."
    Mr. Birch: Is the hon. Member not in danger of deviation from party lines on this subject because, as I under-stood it, nationalisation is a Communist doctrine?
    Mr. Gallacher: I will take all responsibility for any deviation I may make, and I will never ask any of the hard-faced gentlemen opposite to be my guarantors.
    Hon. Members: Order.
    Mr. Deputy-Speaker: I cannot see any connection between what the hon. Member is now saying and the Amendment on the Order Paper.
    Mr. Gallacher: I want to support this Amendment, Mr. Deputy-Speaker, and I was saying that hon. Members opposite are not interested in the soul of a nation but, mention money, and their eyes glitter. I am convinced that all the generating power which is possible it there was one area board, could become an important factor for the' whole of the general Welsh economy. It would guarantee light to the dark places which are up there in Wales as they are in Scotland because of the exploitation of each of these small countries that has gone on in the past. It is because of the desire I have to see a nation with the vision and long tradition of Wales, manifested century after century and generation after generation, given the opportunity and the encouragement to build up one powerful electrical organisation, helpful to Wales and its people and bringing light to the whole country, that I support the Amendment.
    Mr. Shinwell: I have not heard the speeches in support of this Amendment as I was engaged in taking a little nourishment, in order to fortify myself against the attacks of hon. and right hon. Gentlemen opposite.
    Mr. R. S. Hudson: The right hon. Gentleman has been a very long time about it.
    Mr. Shinwell: I have never found that the right hon. Gentleman the Member for Southport (Mr. R. S. Hudson) ignores such considerations. I shall not enter into discussions of whether or not we can fortify the soul of Wales by permitting complete independence. That has nothing to do with this Bill. But I must ask the House to reject the proposal—somewhat

    533
    regretfully, because I fully appreciate the intentions of Welsh Members in this matter—because of the technical considerations involved. Wales, in fact, is not an entity in the realm of electricity supply. The transmission lines do not run from South Wales to North Wales. In both Northern Wales and Southern Wales the transmission lines run from East to West and it would be folly, at any rate at the present time, and for some time to come, whatever decision is reached subsequently when the area is fully developed to disturb the existing system. That would confer no advantage on Wales at all. In the matter of electricity supply, we have to maintain in Wales, or in any part of the country, a proper balance of load. Some parts of the country are uneconomic in the sphere of electricity supply distribution, hill areas, remote areas, which are not yet urbanised, and therefore are not yet capable of fortifying themselves economically. In this matter we must maintain a correct balance. The congested, profitable economic urbanised areas must rally to the assistance of the rural areas. I imagine the House will agree that that is a sound proposition, and it is therefore much more desirable that North Wales, which is not highly developed in the sphere of electricity supply should be integrated, at any rate for some time to come, with the urbanised Merseyside area as a result of which North Wales will gain more advantage, than if it were integrated with the rest of Wales
    That shortly is the case against the proposition, but I would direct attention to the fact that we have the power to vary the areas. We must come to the House if such a proposition should be made, because on the matter of variation of areas we must secure the consent of the House. No doubt in due course—not for some time, font in the future—it may be necessary to ask consent for the variation of areas. If the circumstances of that time justify a reconsideration of the Welsh position, I have no doubt that whoever is responsible for the conduct of the industry will take those factors into consideration. For the moment, I am unable to accept the proposal.
    8.30 p.m.
    Mr. Hopkin Morris: I do not know whether the Minister is holding out some promise for the future. I understand that he says that development at the moment is from East to West both
    534
    in North and South Wales. That is true, because in building up the electricity supply it has been based upon an East and West division. If that is perpetuated in the future, Wales will always be divided, and there will be an argument for it on a basis of fact. It is no argument to say that this is a basis of fact because it happened in the past. I do not know if the Minister is holding out some hope for the future when he says that this division may not be permanent. We are here dealing with the area board, that is, an administrative body. I see no reason why the administrative body should coincide with the electricity lines. Why should there not be an area board for Wales, joining North and South, with an arrangement for the North to take its electricity supply from the area of Liverpool? A similar arrangement has already been provided for in the health service, where the same problem arises, especially in North Wales. Liverpool? supplier hospital accommodation for North Wales. That is an administrative arrangement, and the Minister of Health has recognised that position. I see no reason why the Minister should not recognise the administrative difference, and make arrangements, no matter from whence the supply comes, for an area board for Wales. I hope he will consider that at a later stage.
    Mr. Shinwell: That point was considered. I am not unsympathetic to the point of view which has been expressed, but administration must be associated with the physical assets and the like, otherwise it is impossible to ensure efficient administration. I am sorry that I cannot accept the Amendment.
    Amendment negatived.

    THIRD SCHEDULE.—(Adaptations and Modifications of Enactments.)
    The Solicitor-General: I beg to move, in page 80, line 25, at the end, to insert:

    "s. 21

    …

    After the Word 'consent' in the first and third places where it occurs, the words 'or authorisation' shall be inserted, and after the word 'to' in the first place where it occurs there shall be inserted the words 'or for'."

    This Amendment, which should be read in conjunction with the Amendment, in page 88, line 44, column 2, effects the same purpose. It is to bring into line with the new provisions of Clause 9 of the Bill Section 21 of the

    535
    1919 Act, which deals with the placing of an electric line above ground, under the provision of the Electric Lighting (Clauses) Act, 1899.Clause 9 has given a new power to do that, and this Amendment makes the necessary alteration to Section 21.
    Amendment agreed to.
    The Solicitor-General: I beg to move, in page 82, line 5, column 2, at the beginning, to insert:
    "In Subsection (1) for the word 'applications' there shall be substituted the words 'application is,' after the words 'place the line' there shall be inserted the words 'or, as the case may be, may commence proceedings under the Acquisition of Land (Authorisation Procedure) Act, 1946, as applied by Section nine of the Electricity Act, 1947, to purchase compulsorily a right to place the line' and at the end of the Subsection there shall be inserted the words' or, as the case may be, under the said Section twenty-one and under the said Act of 1946 as so applied.' "
    This, again, is little more than a drafting Amendment. It applies Clause 9 to Section 44 of the 1926 Act. 'That Section enables the Minister to proceed, in the matter of certain inquiries, simultaneously under Sections 21 and 22 of the 1919 Act, which provides for alternative inquiry machinery. This Amendment adds a third alternative where the provisions of Clause 9 are brought into it. Clause 9 is the one which applies the compulsory acquisition procedure and gives certain rights with regard to the laying of electric lines. This is really a matter of drafting.
    Amendment agreed to.
    The Lord Advocate: I beg to move, in page 84, line 8, after "standards," to insert:
    "and which shall be such as to secure the provision of separate information as respects the generation of electricity, the distribution of electricity and each of the main other activities of the Board."
    This is consequential on the Amendment made to Clause 41. It secures that a statement of accounts of the North of Scotland Board shall include separate information concerning the board's activities in the same way as is done in the case of the accounts of the authorities.
    Amendment agreed to.
    Further Amendments made:
    In page 85, line 30, leave out "national interest," and insert "interests of national security."
    In page 86, line 36, column 2, leave out "generation," and insert "generating."
    In page 88, line 44, column 2, at end, insert:
    "and in the said paragraph (b)for the words from 'without' to 'also' there shall TEFL substituted the words 'without the express consent or authorisation of the (Minister of Fuel and Power and the express consent of the local authority also.' "—[Mr. Shinwell.]

    FOURTH SCHEDULE.—(Enactments Repealed.)
    Mr. R. S. Hudson: I beg to move, in page 91, line 5, column 3, to leave out "19."
    I gather that it would be convenient if we considered at the same time the next two Amendments, in page 91, line 16, column 3, after "23," to insert, "except Subsection (1)," and in line 22, column 3, to leave out "24." There is a common thread running through them. All theses three Amendments were discussed in Committee and rejected by the Committee as a result of what, on further consideration, we think were misunderstandings. We hope that they can be accepted now. They are not of major importance. The effect of the first Amendment is to save from repeal Section 19 of the 1882 Act. In the course of our discussion upstairs the Parliamentary Secretary said:
    "It is certainly our intention, in relation to Sections 19 and 20 of the 1882 Act, that both safeguards should apply to all consumers."— [OFFICIAL REPORT, Standing Committee E, 6th May, 1947; c. 912.]
    That has been carried out in the case of Section 20. Apparently it has been overlooked in the case of Section 19. The effect of Section 20 is to say that no consumer must be given unduly favourable terms. Section 19 says that no consumer must be given unfavourable terms. One is a positive and the other a negative discrimination, and I imagine that, in the circumstances, the Government will be prepared to accept this Amendment. Shall I deal with this one first, Mr. Deputy-Speaker, and then deal with the other two?
    Mr. Deputy-Speaker: It will be in Order if the right hon. Gentleman will deal with all three Amendments together.
    Mr. Hudson: So far as the Amendment to line 16 is concerned, it concerns the subject of the acquisition of land for gas undertakings. This matter, again, was

    537
    debated upstairs and the Solicitor-General said that the protection was unnecessary because, in fact, the compulsory purchase of land would be under the Land Acquisition (Authorisation Procedure) Act, 1946, which protects land belonging to statutory undertakings. That is quite true, but a certain number of cases will arise where the land belongs to non-statutory undertakers, and, in such cases, the protection of that Act does not run. Therefore, we suggest that, as a certain number of cases will now arise involving non-statutory undertakers under the new Schedule subsequently to be discussed, it is desirable to restore this small protection.
    In regard to the next Amendment, here again this matter was debated in Committee, and this Section which we desire to save imposes a penalty on undertakers who do not carry out their statutory obligations. The Solicitor-General said that, in the case of local authorities not carrying out such statutory duties, there was no penalty, and that the only thing which the Ministry could do was to look up their special order to see if the local authority had not carried out its duties to supply. I am not surprised, in view of the multiplicity of jobs which the Solicitor-General has to do, that he made what we think was a slight slip in this case, because under Section 23 the Minister has power to impose such conditions as he thinks fit and any conditions so imposed shall be regarded by the undertakers as having statutory effect. No doubt, the Solicitor-General had the point in mind when he talked about looking at the order, but, in fact, under this Section, as we want to see it restored, there is a right to impose conditions which in effect amount to the issuing of directions to the local authority, and we think that the Minister ought to have similar powers to give directions to the Central Authority. I do not suggest that these Amendments are of particular importance, but I hope the Government will see their way to accept them.
    The Solicitor-General: I think that, with regard to one of the Amendments, we can go a little way to meet the case which has been made by the right hon. Gentleman, but not with regard to the other two, and I will endeavour to state my reasons. With regard to the first of these Amendments, which would have the effect of resurrecting Section 19 of the
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    Electric Lighting (Clauses) Act, 1882, the right hon. Gentleman will recollect that, when we were discussing Clause 32 (7) earlier in these discussions, we accepted an Amendment in the name of the hon. Member for Northwich (Mr. J. Foster) dealing with undue discrimination. We feel that, as Subsection (7) stands, or as it will be worded when these words have been brought into it, it will accomplish, so far as we feel it ought to be accomplished, the object which the right hon. Gentleman has in mind.
    In point of fact, the provisions of the Bill, as it stands give the statutory consumer only the rights conferred by Section 27 of the Electric Lighting (Clauses) Act, 1899. The non-statutory consumer, as pointed out earlier in our discussions, is left in the same position as he was before, subject to the point which I think interested the hon. Member for Stockport (Sir A. Gridley) very much, the extension of the liability of an undertaker, now the Board, to provide distributing mains. Hon. Members will know, of course, that a statutory consumer is the consumer who owns or occupies premises within 50 yards of the distributing main.
    8.45 p.m.
    We have provided that the Board shall be under the obligation, at the request of six or more persons, to lay down a distributing main, not merely along a street, but along a route, which considerably widens the burdens placed upon them, and, therefore, greatly extends the category of persons who come within the scope of Section 27 of the Schedule to the 1899 Act, and who, accordingly, become statutory consumers with the right to demand a supply. Having done that, and having enlarged the scope of the Act, we feel that we have supplemented that by the provisions of Subsection (7) to such an extent that we have virtually covered the ground which is covered by Sections 19 and 20 of the 1882 Act. For those reasons and because in other words, we have virtually done what the first Amendment seeks to do, I ask the House to reject that Amendment.
    With regard to the second Amendment, we feel that, at a later stage in the life of this Bill, before it becomes an Act, we could go some way towards meeting what the right hon. Gentleman proposes; but we cannot accept the Amendment as it stands because it has a serious drafting

    539
    defect, in that it incorporates part of Section 23 of the Schedule to the Electric Lighting (Clauses) Act which relates to the special Act. As there is no special Act, it would be meaningless to bring in that part of the Section. But without giving any formal undertaking, we will consider introducing into the Bill the first part of the Section, suitably drafted, which the right hon. Gentleman desires With regard to the final Amendment, we feel that we cannot accept it, if for no other reason than that it would be meaningless in the context, because what happens is this: Section 24 of the Electric Lighting Act, 1909, provides that nothing is to enable the Board of Trade to authorise the compulsory acquisition of land belonging to a Statutory undertaker; they can authorise only the acquisition of such land under Section 1 of the 1909 Act. Section I of that Act is repealed by this Bill. Therefore, if the Amendment were accepted, it would, as I say, be meaningless, because it would simply say that the Board of Trade shall not be empowered to take certain action under a Section which has been repealed. For that reason, I ask the House to reject the Amendment.
    Mr. R. S. Hudson: With the leave of the House, I would like to ask one further question. Do I understand that during the remaining stages of the Bill the Government will consider some alteration in order to do what our Amendment, even though it may be defective in form, was meant to do, namely, to protect lands of non-statutory undertakers? I understand that practically all the gas undertakings are non-statutory, and that, from the practical point of view, there is a definite problem to be solved. Perhaps the Solicitor-General would look into that point, because there is a very genuine case which requires to be safeguarded.
    The Solicitor-General The Solicitor-General indicated assent.
    Mr. Boyd-Carpenter: I would be grateful if the Solicitor-General would clear up one point. He has been very reasonable in his response to my right hon. Friend the Member for Southport (Mr. R. S. Hudson), but I am not clear on one point with respect to the first Amendment which seeks to preserve Section 19 of the Act of 1882. The Solicitor-General told the House that the provision incorporated today in the Bill, if I may quote his own
    540
    word, "virtually" has the same effect. He used the word "virtually" on two or three occasions, and I took it to mean that the provision did not completely have the same effect as Section 19 of the 1882 Act. As the Solicitor-General is aware, that is a very important Section. It provides that there shall be no discrimination against an individual consumer by charging him more than similar consumers are charged. That is obviously a very important provision. Perhaps the Solictor-General, with the leave of the House, could make it quite clear to what extent his new provision fails to go the whole distance of the 1882 Act. He said "virtually" did. That presumably means that it does not do so completely. To what extent does it not do so?
    The Solicitor-General: If I may have the leave of the House to reply, the reason I used the word "virtually" was because the Section contains the expression,
    "part of an area."
    It is extremely difficult to define what one means, in relation to the area of an undertaker, when one refers to "part of an area." It will be considerably more difficult when one considers the greatly enlarged areas of the area boards. Therefore, when I used the expression "virtually," I was doing so in order to prevent myself saying that Subsection (7) meant exactly the same as a provision the precise meaning of which I myself could not define.
    Mr. J. Foster: I would like to reinforce the point made by my hon. Friend the Member for Kingston-upon-Thames (Mr. Boyd-Carpenter). I would like the Solicitor-General to tell us whether the principle of the Amendment is or is not accepted. The object of the Amendment is to preserve the immunity from interference of all gas and water undertakers. As the law will stand if this part of the Bill goes through unamended nonstatutory undertakers will not be protected from interference. I believe that to be the law. If I am wrong, I would be grateful if the Solicitor-General would correct me. If, on the other hand, I am right, I would be grateful if he would state why he does not want non-statutory undertakers to be protected from interference.
    The Solicitor-General: If I may again ask the leave of the House to reply, as

    541
    the hon. Gentleman says, the protection given in paragraphs 9 and 10 of the First Schedule of the Acquisition of Land Act relate to the property of statutory undertakers. I believe the greater number of the non-statutory undertakers are in Scotland, about which I rather hesitate to speak, but, as I have said, if hon. Members opposite will be good enough to give us their advice between now and a later stage, we will consider very carefully what they say. I do not intend that to be taken as a formal undertaking.
    Mr. R. S. Hudson: I am obliged to the hon. and learned Gentleman. I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    The Solicitor-General: I beg to move, in page 91, line 32, column 3, to leave out "33" and to insert "32."
    The object of this Amendment is to preserve from repeal the provisions of Subsection (1) of Section 33 of the Electricity Supply Act. That is a Section which enables the provisions of the Local Government (Superannuation) Act, 1937 —that Section as amended by later Sections—to be applied and used for pension purposes. As the Bill stands at the moment that Section is repealed. We can do that by regulations, if we think fit; under the Bill as it stands we have regulation-making power with regard to pensions. We feel that it is possible that it may be desirable for the area boards or the Central Authority to avail themselves of the provisions of the Superannuation Act of 1937, and, therefore, we do not want to repeal that power at the moment. If we should desire to do so hereafter, if it is found unnecessary to use the provisions of the 1937 Act, we should prefer to do so by regulations under the regulation-making power.
    Mr. R. S. Hudson: I dare say there is something to be said for this, so far as convenience is concerned; but, as I understand it, the effect of what we are being asked to do is to give the Government power to repeal an Act of Parliament, not by another Act of Parliament, but merely by Order in Council or regulation. It seems to me to be going rather far.
    Amendment agreed to.
    Mr. Shinwell: I beg to move:
    "That the Bill be re-committed to a Committee of the Whole House in respect of the
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    Amendments to Clause 13, page 15, line 6; Clause 13, page 16, line 2; Clause 13, page 16, line 32; all the Amendments to Clause 14; the Amendments to Clause 17, page 24, line 13; Clause 19, page 28, line 32; Clause 20, page 30, line 9; Clause 20, page 30, line 16; Clause 2i, page 33, line 8; Clause 22, page 33, line 11; Clause 22, page 35, line 35; Clause 23, page 36, line 14; Clause 24, page 38, line 38; Clause 25, page 38, line 45; Clause 26, page 39, line 40; all the Amendments to Clause 29; the Amendments to Clause 30, page 44, line 34; Clause 34, page 47, line 33; Clause 35, page 48, line 19; Clause 37, page 49, line 21; Clause 50, page 61, line 28; Clause 59, page 67, line 44; Clause 59, page 68, line 9; Clause 59, page 69, line 7; Clause 59, page 70, line 19; Clause 59, page 70, line 38; and of all the new Clauses and of the new Schedule standing on the Notice Paper in the name of Mr. Shinwell."
    Lieut.-Colonel Elliot: We do not propose to oppose the Motion, but we had moved that the Bill be considered in Committee of the Whole House, and I really do think it would have beep a saving of the time of the House if that had originally been done. The Government are now proposing to embark on what is very nearly a Committee stage of the Bill at the end of a long day under conditions which, although they are improved by the concessions of the Government to the suggestions made to them, do not by any means meet the position which should be met if the House of Commons is to legislate on this great and important subject as it ought.
    Mr. Shinwell: I only want to say that we are getting on so well it is a pity to spoil it.
    Bill immediately considered in Committee.
    [Mr. HUBERT BEAUMONT in the Chair]
    9.0 p.m.
    Lieut.-Colonel Elliot: On a point of Order, Mr. Beaumont. We have now gone into Committee, and earlier we did discuss with Mr. Speaker what the position would be at the conclusion of this stage. As Mr. Speaker said—
    The Deputy-Chairman: That may be so, but we cannot now, in Committee, discuss what may happen later when the Committee stage ends.
    Lieut.-Colonel Elliot: I wish only to ask what the position would be if manuscript Amendments are put down. If no Amendment is made during the Committee stage,

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    the Clauses, of course, would be unchanged. If, however, the Opposition or any hon. Member desired to submit manuscript Amendments, could you give us your guidance whether such Amendments would be in Order, in view of the unusual fact that we are taking the Committee stage after the Report stage. Manuscript Amendments are usually out of Order on Report.
    The Deputy-Chairman: That is a matter on which I can give neither guidance nor a Ruling. It is a matter for Mr. Speaker.
    Mr. R. S. Hudson: Further to that point of Order. Does not that depend upon who happens to be in the Chair? Is it certain that Mr. Speaker will be sent for and will be in the Chair when the Committee stage comes to an end?
    The Deputy-Chairman: That is not for me to decide. We are now at the commencement of the Committee stage, and I can deal only with the Amendments on the Order Paper. I cannot now deal with any matter which does not relate to the Committee stage.

    CLAUSE 13.—(Vesting of assets of electricity undertakings.)
    Mr. Gaitskell: I beg to move, in page 15, line 6, to leave out Subsections (2) and (3).
    While discussing this Amendment I should like also to mention the two following Amendments: in page 16, line 2, to leave out from "any," to the end of line 3, and to insert "electricity holding company," and in page 16, line 32, to leave out from "any," to "company" in line 33, and to insert "electricity holding." These Amendments are paving Amendments to the proposed new Clause —(Bodies to whom Part II of Act applies)—which we shall move later. I hope, therefore, that we shall have the agreement of the Opposition to allow these Amendments to go through as paving Amendments, on the usual understanding.
    Amendment agreed to.
    Further Amendments made: In page 16, line 2, leave out from "any," to end of line 3, and insert, "electricity holding company."
    In line 32 leave out from "any," to "company," in line 33, and insert, "electricity holding."—[Mr. Gaitskell.]
    Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."
    Lieut.-Colonel Elliot: On a point of Order, Mr. Beaumont. We do not intend to debate this Clause, but I take it, in regard to future Clauses, now that we are back in Committee, not merely the Amendments but the Clauses as a whole are subject to the general consideration of the whole Committee?
    The Deputy-Chairman: Debate on the Clause, as amended, will be permitted.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 14.—(Provisions as to undertakings of local authorities.)
    The Solicitor-General: I beg to move, in page 19, line 47, to leave out from "property," to "in," in line 1, page 20, and to insert:
    "held or used by the local authority wholly or mainly."
    This is the first of a series of Amendments designed to achieve the same purpose. Doubts had arisen under Clause 14, as to precisely what it was that would be transferred upon the vesting of the assets of a local authority. An example quoted as an illustration of the doubts which had arisen was the case of a town hall which might be vested simply because there was an electricity sub-station in the basement. The relevant words of the Clause are at the moment—
    "rights, liabilities and obligations held, used or incurred by the local authority in their capacity as authorised undertakers and accordingly references in that section."
    It was said that in the case I have instanced it might be argued that the town hall could be said to be held in their capacity as authorised undertakers. That is not intended at all. What the Amendments seek to do—and this is the keynote which runs through all of them—is to substitute for the words I have quoted:
    "property held or used by any local authority partly in their capacity as authorised undertakers and partly in other capacities."
    They provide machinery whereby these two types of property can be divided. The test is whether the property is held or used by the local authority wholly or mainly in their capacity as authorised undertakers, and that enables a distinction to be drawn

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    in a case such as I have instanced. If hon. Members will look at the Amendments on page 4021 of the Order Paper, they will see that they are all directed towards substituting the test of "wholly or mainly" for the test of "held in their capacity as undertakers." They provide machinery for drawing a line between property held by a local authority as an undertaker, and property held in some other capacity.
    Mr. R. S. Hudson: The explanation given by the Solicitor-General has convinced hon. Members on all sides of the commonsense of these Amendments I would suggest to him that composite companies are in an analogous position to that of local authorities in respect of a great deal of this sort of property. We should be grateful if the hon. and learned Gentleman would give consideration to the question of whether a similar provision could not be applied to the analogous case of composite companies.
    Amendment agreed to.
    Further Amendments made: In page 20, line 2, after "undertakers," insert:
    "and rights, liabilities and obligations acquired or incurred by the local authority in the said capacity."
    In line 8, leave out "rights, liabilities, obligations," and insert:
    "held or used by the local authority wholly or mainly in their capacity as authorised undertakers and rights, liabilities and obligations acquired or incurred by the local authority in the said capacity or, as the case may be, to."
    In line 13, at end, insert:

    "(a) for excluding from or including in the property which vests in an Electricity Board by virtue of this Act, such property held or used by any such local authority partly in their capacity as authorised undertakers and partly in other capacities, on such terms (which may include the payment of money), as may be agreed between the Electricity Board concerned and the local authority or, in default of agreement, determined in accordance with the regulations;

    (b) for requiring any Electricity Board, as respects property which vests in them by virtue of this Act, being property held or used by any such local authority partly in their capacity aforesaid and partly in other capacities, to grant to the local authority such interests in the property or rights over or attaching to the property or in respect of the user thereof, on such terms (which may include the payment of money), as may be agreed between the Electricity Board and the local authority or, in default of agreement, determined in accordance with the regulations, or for requiring the similar grant of interests
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    or rights by the local authority to the Electricity Board in a case where such property does not vest in the Board."

    In line 37, at end, insert:
    "For the purposes of this Subsection, any property which is held or used by a local authority temporarily in their capacity as authorised undertakers and normally in other capacities, or normally in the said capacity and temporarily in other capacities, shall be deemed to be property held or used by a local authority partly in the said capacity and partly in other capacities."—[The Solicitor-General.]
    The Solicitor-General: I beg to move, in page 20, line 38, to leave out Subsection (3).
    This is a drafting Amendment.
    Mr. R. S. Hudson: This seems to be a large piece of drafting, extending over 12 lines. Perhaps the hon. and learned Gentleman could explain it.
    The Solicitor-General: It is drafting in the sense that Subsection (3) has been lifted bodily out of Clause 14, and will be transferred, if these Amendments are accepted, to Clause 19.
    Amendment agreed to.
    Further Amendment made: In page 21, line 8, leave out from "property," to third "or," in line 9, and insert:
    "is or was held or used by any such local authority wholly or mainly in their capacity as authorised undertakers or whether any rights, liabilities or obligations were acquired or incurred by any such local authority in the said capacity or whether any agreements or documents relate."—[The Solicitor-General.]
    The Solicitor-General: I beg to move, in page 21, line 11, to leave out from "undertakers," to "shall," in line 14.
    This is a drafting Amendment of the same character as the one we passed a few moments ago. These words go from Clause 14 to Clause 19.
    Amendment agreed to.
    The Solicitor-General: I beg to move, in page 21, line 15, after "Minister," to insert "of Health."
    This Amendment is to meet a point raised in Standing Committee by the hon. and gallant Member for New Forest and Christchurch (Colonel Crosthwaite-Eyre).
    Colonel Crosthwaite-Eyre: No.
    The Solicitor-GeneralI am very sorry. I thought it was the hon. and gallant Member who raised the point. However,

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    it was said by a Member of the Opposition that the Minister should not be the person to determine questions arising on the vesting of local authority undertakings, and my hon. Friend the Parliamentary Secretary suggested that it would be appropriate for the Minister of Health to be substituted for the Minister of Fuel and Power.
    9.15 p.m.
    Colonel Crosthwaite-Eyre: I think that on consideration the learned Solicitor-General's remark should be withdrawn.
    The Solicitor-General: I hope that the hon. and gallant Gentleman does not think that anything I have said was meant to be offensive to him. The reverse is very much the Case. I thought that he had made the suggestion, and I found that he had not, but as I thought that it was a good suggestion I complimented him on being the reputed author of it.
    Amendment agreed to.
    Further Amendment made: In page 21, line 20, at end, insert:
    "(5) Where at any time before the expiration of three months beginning with the vesting date a local authority has served on the Minister of Health and on the Electricity Board concerned, or an Electricity Board has served on the said Minister and on the local authority concerned, a notice in the prescribed form stating that a question has arisen under this Section or under any regulations made thereunder as to—

    (a) whether any property is or was held or used by the local authority wholly or mainly in their capacity as authorised undertakers and accordingly vests in the Electricity Board by virtue of this Act;

    (b) whether any property of the local authority ought to be excluded from or in eluded in the property which so vests;

    (c) whether interests in any property of the local authority, or rights over or attaching to such property or in respect of the user thereof, ought to be granted by the local authority to the Electricity Board or by the Board to the authority; or

    (d) whether any lease ought to be severed; and the question has not been settled by agreement or determined before the vesting date, the property concerned shall not, pending such agreement or determination, vest in the Electricity Board by virtue of this Act and, if the notice is given after the vesting date, shall be deemed not to have so vested, but the property shall, so far as it is so to vest having regard to the agreement or determination, vest on such date as may be agreed or determined, and pending the settlement or determination of the said question and the vesting of property and the granting of interests or rights in accord-
    548
    ance therewith, the Electricity Board shall be entitled and shall be deemed to have been entitled as from the vesting date to use the property for the like purposes and to the like extent as it was used, immediately before that date, by the local authority in their capacity as authorised undertakers, on such terms (which may include the payment of money) as may be agreed between the Electricity Board and the local authority or, in default of agreement, determined by the Minister of Health."— [The Solicitor-General.]

    The Solicitor-General: I beg to move, in page 21, line 26, after "authority," to insert:
    "or be transferred to that Board any property forming part of a sinking fund established for the redemption of any such loan."
    This rectifies an error in the Clause as drafted, and provides that sinking funds established for the redemption of a loan should not be transferred on vesting, the position being that in the case of authorities with services on loan it is appropriate that the sinking fund should not be transferred. That was not provided for in the Clause as it stands, and this Amendment remedies that omission.
    Amendment agreed to.
    Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."
    Mr. R. S. Hudson: The Minister, at an earlier stage this afternoon, saw fit to admonish us that "a little knowledge is a dangerous thing." If he will lake the trouble to look back and read this Clause over again, perhaps he will realise that a little knowledge is not only a dangerous thing but causes a great deal of trouble to this Committee by reason of his having had to recommit all this.
    Lieut.-Colonel Elliot: I would ask the Minister to realise how extremely reasonable we have been in dealing with this Clause. [Interruption.] I hope that the hon. Member realises that also. The whole of Clause 13, which raises great issues on vesting, we have allowed to go, although we had a perfect right to discuss it in Committee and could have discussed it indefinitely here. On Clause 14 we have not attempted in any way to delay the passage of the Bill. I trust that both the Minister and the Government will realise, when we come to the later stages, that we are allowing to pass, without any attempt at obstructing, Clauses which could perfectly well have been discussed

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    at considerable length, because we are desirous of having discussions on later points of importance which arise on the Minister's new Clauses.
    Mr. Shinwell: I am not complaining about the attitude of the right hon. and gallant Gentleman. I am delighted to witness such sweet reasonableness, and all I hope is that we keep it up.
    Colonel Crosthwaite-Eyre: I would like to' offer my apologies to the learned Solicitor-General for the misunderstanding which arose earlier.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 17.—(Compensation to holders of securities of bodies other than local authorities.)
    The Financial Secretary to the Treasury (Mr. Glenvil Hall): I beg to move, in page 24, line 13, after "authority," to insert "or a composite company."
    Perhaps I ought to offer a brief explanation of this Amendment to the Committee, because the reason for inserting these words here is not apparent as we have not yet dealt with the new Clause to which reference is here made. This Clause lays down the compensation to be paid to undertakings other than local authorities, and as I think the hon. Members of the Committee are now aware, there are companies which are to be known as "composite companies." They are companies which are engaged in other activities besides the provision of electricity; they may provide gas, or water, or both; and by a new Clause which we shall be coming to presently, we intend to deal with companies in that situation. The short point here is that those companies, unlike the companies to which this Clause refers, will continue in existence, and therefore we shall be paying compensation not to the holders of securities but to the companies themselves. As I have said, we shall be dealing with the matter more fully when we come to the new Clause, and perhaps that brief explanation will be sufficient at the moment.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 19.—(Compensation to local authorities.)
    The Solicitor-General: I beg to move, in page 28, line 32, to leave out Subsections (2) to (5) and to add:
    "(2) Where the local authority have raised a loan wholly or partly for the purposes of their functions as authorised undertakers, or have advanced money for those purposes out of any consolidated loans fund or mortgage loans pool established by them or out of any other moneys held by them, and, in pursuance of the arrangements in force immediately before the vesting date for the redemption of the loan and the payment of interest thereon or, as the case may be, for the repayment of the advance and the payment of interest thereon, any amounts would, but for this Act, have fallen, on or after the vesting date, to be debited in the accounts of the local authority in their capacity as authorised undertakers, the Central Authority shall, subject to the provisions of this Section, pay those amounts to the local authority at the times at which, but for this Act, those amounts would have fallen to be debited in the accounts of the local authority in their capacity aforesaid.
    (3) Where the local authority have before the vesting date made arrangements for the making of financial adjustments, as between the accounts of the local authority in their capacity as authorised undertakers and any other account of the local authority, in respect of any other transaction or matter affecting both their functions as authorised undertakers and other functions of the authority, and in pursuance of those arrangements any amounts would, but for this Act, have fallen, on or after the vesting date, to be debited or credited in the accounts of the local authority in their capacity as authorised undertakers and credited, or, as the case may be, debited, in some other account of the local authority, the Central Authority shall, subject to the provisions of this Section, pay those amounts to the local authority or be entitled to receive those amounts from the authority, as the case may be, at the times at which, but for this Act, those amounts would have fallen to be debited or credited in the accounts of the local authority in their capacity aforesaid:
    Provided that this Subsection shall not apply in relation to any apportionment of establishment charges between the accounts of the local authority in their capacity aforesaid and other accounts of the authority.
    (4) The Central Authority and the local authority may agree or the Minister of Health may, on the application of either party in default of such agreement, determine that, having regard to the circumstances in which any such arrangements were made and the circumstances arising under this Act, the last foregoing Subsection shall not apply to those arrangements or shall apply thereto with such modifications as to the payments to be made by the Central Authority or the local authority as may be so agreed or determined, and the said Subsection shall have effect subject to any such agreement or determination.

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    Any other question arising under either of the two last foregoing Subsections as to the payments to be made thereunder shall, in default of agreement, be determined by the Minister of Health.
    (5) Any payment made by the Central Authority or the local authority under the foregoing provisions of this Section which would, but for this Act, have been debited or credited as a capital payment, shall be deemed to be a capital payment, and any other such payment shall be deemed to be an annual payment."
    This rather formidable looking Amendment is designed to achieve the following purpose. If hon. Members will glance at Clause 19 as it stands, I think they will agree that its provisions, as contained in Subsections (2) to (5) are appropriate only to the cases where local authorities have borrowed from outside. This Amendment is designed to deal with cases in which they have made advances as between their own undertakings, that is to say, if one undertaking of a local authority has advanced to another, or if advances have been made from a central consolidated fund, or from a mortgage loan pool, to the electricity undertaking. Such cases would not be dealt with by the Clause as it stands. What we are here seeking to do, therefore, is to put these internal loans, as I may call them—loans as between another branch of the local authority and its electricity branch—on precisely the same footing as external loans, so as to provide that they shall be serviced in exactly the same way as external loans. We therefore seek to leave out the provisions contained in the present Subsections (2) to (5), which are inappropriate in that they deal only with external loans, and to substitute for them the new Subsections contained in the Amendment, which cover both internal and external loans.
    Question, "That the words proposed to be left out stand part of the Clause," put, and negatived.
    Question proposed, "That the proposed words be there added."
    Mr. R. S. Hudson: I beg to move, as an Amendment to the proposed Amendment, in line 24, to leave out from the beginning to the end of line 26.
    An earlier Amendment to Clause 13 was described by the Solicitor-General as a drafting Amendment, and I asked why such a very large number of lines were
    552
    only a drafting Amendment. He explained that Subsection (3) had been taken bodily out of Clause 14 and is later to be placed in Clause 19. He did not tell us that in the process an important proviso had been tacked on, and that is the proviso which we are now seeking to leave out. It reads:
    "Provided that this Subsection shall not apply in relation to any apportionment of establishment charges between the accounts of the local authority in their capacity aforesaid and other accounts of the authority."
    We should very much like to know what is behind the insertion of the proviso, because I confess that I do not know sufficient about the details of local authority finance to be able to follow all its ramifications, but some members of local authorities are worried about this proviso, because whereas, the new Subsection seemed to give the local authority certain departmental arrangements which would result in extra finance to them, this new Clause provides only one extra source of finance, namely, the establishment charges. These local authorities believe, rightly or wrongly, that the terms depart from the Minister's proposals which will come up under subsequent Clauses to make an ex gratia payment of £5 million. I shall be glad of an explanation. It may be that this proposal merely opens the way for the new Clause, but the point needs to be cleared up. It is so complicated that I will leave it there to hear what explanation the Minister may give, and my other remarks may be more appropriately made when we come to consider one of the Amendments which we have down to the new Clause.
    The Solicitor-General: I ought to apologise to the Committee for not making reference to that proviso, but frankly it slipped my mind. The object of the proviso is that if the Committee accept the new Clause to pay compensation to the tune of £5 million, the object of the proviso will be to prevent what will be, in effect, double payments to local authorities supposing, for example, in respect of the joint establishment charges, a sum is owed by the Central Authority to the central fund. Compensation in respect of that sum should not be paid both by the British Central Authority by way of servicing and also again as part of the apportionment of the £5 million compensation which is being paid by way of severance. What this actually does is to take out estab-

    553
    lishment charges from the sphere of Subsection (3)—which, as hon. Members will remember, provides for this cross-accounting, if I may so call it—in order to prevent a payment from being made under Subsection (3) in respect of what is in fact severance, and then another separate payment when the £5 million comes to be allocated to the various local authorities which have suffered loss in consequence of the severance.
    9.30 p.m.
    Mr. R. S. Hudson: That explanation will perhaps help other Members of the Committee; it has certainly helped me. Do I take it that we are using the two terms "establishment charges" and "severance" to indicate the same thing?
    The Solicitor-General The Solicitor-General indicated assent.
    Amendment to the proposed Amendment negatived.
    Proposed words there added.
    Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."
    Major P. Roberts: I do not want this Clause to pass without making it quite clear that I, for one, am not satisfied that it gives a square deal to local authorities. I have held this view all along, particularly with regard to Sheffield, which I have the honour to represent. By paying some £5 million the Government would have in Sheffield in some five years' time an asset worth £11 million, and I am not at all satisfied that that is a fair deal. In point of fact, the council there, which has been a Socialist council, has for the last 20 years been paying £500,000 a year towards the reduction of its loan. If they had not done so they would be that amount better off. This principle will no doubt go through, but if local authorities and others follow it as a precedent in future in respect of gas or water, or whatever it may be, it will tend towards extravagance and maladministration. I did not want this Clause to pass without voicing that protest.
    Lieut.-Colonel Elliot: I think my hon. and gallant Friend was well justified in the protest he has made, because the new Clause which the Minister is to introduce later on dealing with severance does not go to the root of the complaint which the local authorities have against those pro-
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    visions. What is more, the Association of Municipal Corporations and others have brought it very clearly to our notice, and to that of right hon. Gentlemen opposite, that they have the strongest objections to the insufficiency of the sum which is being allotted to deal with their problem—and only a portion of their problem at that. The main gravamen of their charge that under this Clause publicly-owned undertakings are not receiving a square deal when being taken over by another publicly-owned undertaking still remains. My hon. and gallant Friend has referred to the municipality of Sheffield where, as he says, a Socialist council was in power. A similar complaint was made by the town council of Glasgow, where again a Socialist authority was in power, and it was thought that for its own compensation alone a sum of £12 million should be allotted, which is more than twice as much as the entire global sum offered to the whole of the local authorities of Great Britain to deal with this problem.
    We know the arguments in favour of it, of course. The first is that it has been debated at previous Labour conferences and that resolutions have been come to saying that one public body ought not to be compensated by another public body; secondly, that it is all going into the one pocket anyhow and is public money; and thirdly, that as the ratepayers have been paid already, it would be a mistake for them to be paid twice over.
    Mr. Kirkwood: Save us from our friends. It is a waste of time.
    Lieut.-Colonel Elliot: The hon. Member for Dumbarton Burghs (Mr. Kirkwood) has been for many years an honoured member of Glasgow town council. If he finds that the submission that Glasgow ought to be paid £12 million is a waste of time, all I can say is that he has forgotten not only his membership of Glasgow town council, but his good Scottish blood. The fact is that we are proposing in a relatively few minutes to deal with and to dismiss this question of the very large sums of money claimed by local councils in Scotland, Yorkshire—
    Mr. Carmichael: The right hon. and gallant Gentleman ought to produce more substantial evidence of the request from Glasgow for this £12 million.
    Lieut.-Colonel Elliot: I can quote the correspondence which I have had with Glasgow and the debates in the Glasgow authority. Does the hon. Gentleman suggest that Glasgow would not be very glad of £12 million?
    Mr. Carmichael: That is not the point.
    The Chairman (Major Milner): Neither is it in Order on the Question before the Committee.
    Mr. Carmichael: It is important, because a public statement is being made that Glasgow town council want £12 million. I think I know the facts equally with the right hon. and gallant Member for the Scottish Universities (Lieut.-Colonel Elliot). He says that Glasgow, a Socialist-controlled municipality, is demanding from a Socialist Government £12 million. A statement of that kind should be substantiated in more solid a way than I have yet noticed.
    Lieut.-Colonel Elliot: I am doing my best, as I said, to cut down to a minimum—
    Mr. Kirkwood: The right hon. and gallant Gentleman's best is not very good tonight.
    Lieut.-Colonel Elliot: If it were backed up by other Scottish Members, it would be better than it is. I am fighting a lone hand on behalf of Scotland. Indeed we on this side of the Committee are fighting a lone hand on behalf of all the municipalities, both Conservative and Socialist. I should like to reply briefly to the hon. Member for Bridgeton (Mr. Carmichael). Of course, when the whip has been lightly cracked with the authority of the Government, the demand, which has been vigorously made during the debates in the town council, has not been persisted in. I never heard that it was not unanimously supported, in spirit at least, by all the members that £12 million ought to be paid by the Government. I rest on this, that in addition to demands for specific sums, very large specific sums, which were made during the debates in the local authorities, the Association of Municipal Corporations itself—and this is something which the hon. Member for Bridge-ton will not deny—has communicated with us and with other Members of the House in the most formal manner, saying that they do not regard the sum proposed by the' Government as being in any way adequate as a settlement of their claim.
    Mr. Carmichael: Yes.
    Lieut.-Colonel Elliot: Then we are at one in saying that, in the opinion of the local authorities of Great Britain as a whole, the sum proposed is grossly inadequate. The exact scale of its inadequacy may be left to subsequent discussion when the hon. Gentleman and I meet outside the Committee. I am not anxious to do it in the Committee. This is the moment at which the Committee is deciding on the taking over of the assets of the local authorities upon what the local authorities themselves consider to be totally inadequate compensation. I have recapitulated very shortly the main arguments why it is said that these sums are inadequate. The contention which is being put forward is fallacious. It is a matter of bookkeeping which ought not to be persisted in. I think I carry hon. Members with me that that is a fair statement of the claim. What I consider that hon. and right hon. Members on that side of the Committee have not fully realised is that the great authorities have produced a sort of entity or corporate body of their own. They are not now merely satisfied with considerations of bookkeeping. They now regard themselves as great, real entities which are being destroyed. We shall have more to say about this at a later stage.
    These great public enterprises—local government enterprises—which have built up great constructive schemes and under which hon. and right hon. Gentlemen in all parts of the Committee—particularly on the Government benches—learnt the technique of modern business enterprise and business management have acquired a personality all their own. The local authorities feel that the destruction of those corporate bodies—
    Mr. Gallacher: Right out of Order, Sir.
    Lieut.-Colonel Elliot: I thought there was only one Chairman.
    Mr. Gallacher: It was outside long ago.
    Lieut.-Colonel Elliot: I ask the hon. Member for West Fife (Mr. Gallacher) to appreciate that it is very difficult for me to limit this discussion, which I am trying to do, if I am to be led away into what might be called a rough and tumble across the Floor with the Communist Party. I am in no way unwilling to

    557
    embark on that but it would take time. Since both of us are Scotsmen, it would take a long time. Let us pass over it. The English ar quietly waiting until these discussions are passed.
    The great local authorities consider that on this they are not having a square deal and that new psychological considerations have arisen which are not being taken into account by the Government of the day. This is merely one example of the Government, working on an arithmetical basis, totally failing to grasp and solve the real problems with which they will find themselves increasingly confronted when they press forward along the path which they have set themselves.
    Several Hon Members Several Hon Members rose—
    The Chairman: I am sure the Committee do not want to embark on a long discussion at this stage.
    Hon. Members: Why?
    The Chairman: As the right hon. Gentleman said, there is a new Clause on this matter which has, indeed, already been discussed upstairs.
    Mr. R. S. Hudson: May I respectfully point out to you, Major Milner, that this Clause has not been discussed at all in the earlier stages. We have had no discussion on local authority compensation—
    Mr. Shinwell: There was, in Committee.
    Mr. Hudson: —so far during the Report stage, because obviously this was the appropriate stage at which to discuss it. It is quite true, as you indicated, Major Milner, that there is a subsequent new Clause, but that Clause is of a very limited character and only deals with the allocation of the £5 million sterling. It does not deal with the major point of this Clause, which is to enable the Government to take over all the assets of the local authorities, merely paying them for the amount of their outstanding loans. With great respect, I suggest that as this Bill consists of two parts, one taking over private companies and the other taking over local authorities, it is reasonable that we should raise our voices here on behalf of the local authorities whose voices have in this matter been so very largely suppressed.
    9.45 p.m.
    Mr. Birch: I shall speak for only one moment to put our point of view. When
    558
    my right hon. and gallant Friend the Memberfor the Scottish Universities (Lieut.-Colonel Elliot) was speaking, he became rather entangled on the subject of Glasgow. Glasgow has a Socialist majority. Socialist majorities have responded against the interests of their towns to the crack of the Socialist whip, and whatever they may have thought, they have not seen lit generally to oppose the Bill. However, many local authorities have passed resolutions and forwarded them to the Ministry of Fuel and Power protesting against the way they have been treated. At least two have done it in my own constituency, and there is no doubt that many municipalities are suffering great financial loss. This procedure puts a premium on the improvident and the whole of Government legislation is tending to do that. We want to register our protest at the way the improvident have been treated, and at the way Socialist town councils are neglecting their duty to their constituents.
    Hon. Members: Nonsense.
    Colonel Clarke: I support what has been said regarding the losses that municipalities, particularly among local authorities, are suffering under the proposed provisions of this Bill. I saw some figures the other day regarding the 365 odd municipal undertakings. Out of 69 of them taken at random, 42 per cent. were losing half their assets; 35 per cent, were losing two-thirds of their assets; 10 per cent., three-quarters of the assets; 11 per cent., more than three-quarters of their assets without compensation. It is appalling. I want to emphasise again what has been said by the hon. Member for Flint (Mr. Birch), that the municipality run on sound financial lines is prejudiced in this case; that is to say, the municipality reducing its debt year by year will now be penalised compared with the one which is less provident.
    Mr. R. S. Hudson: I would not have intervened, Major Milner, but for the interjection of the Minister, who seemed to indicate that he thought, because the question had been raised upstairs, there was no reason for raising it down here. If he will cast his mind back to what happened upstairs he will remember that in answer to suggestions by us that local authorities objected to this confiscation of their local electricity undertakings, the right hon. Gentleman said that the bodies

    559
    which spoke for the municipalities had raised no objection. Quite frankly, at the time it seemed to be a very strong argument, which I was not in a position to rebut, but I made certain inquiries subsequently and I found that on the occasion the vote regarding matters of this sort had been taken, it was on a purely party line, and that representatives of Socialist controlled municipalities had voted down representatives of Conservative municipalities who wanted to protest.
    It is quite clear, in fact, that a number of authorities especially, as my hon. Friend behind me said, the more provident—in which I include my own constituency of Southport—will be penalised for the benefit of the Treasury compared with those who have been spendthrift. I gave the figures for Southport upstairs but, for the benefit of hon. Members who have not heard it down here, not only are the Government taking over the electrical undertaking of Southport, but they are also taking over the reserve fund. As it so happens, the reserve fund amounts almost exactly to the outstanding debt— £146,000 debt and £134,000 reserve fund. The net result of that is that the Government and the new central authority are taking over the Southport Corporation electricity undertaking for nothing.
    Does anyone seriously suggest that anyone who has the interest of the ratepayers or the electricity consumers in Southport at heart is going to be pleased at the idea that this is to happen to an undertaking in which they take a great pride, and which has been built up over a series of years? Of course they are not. In the course of the next year or two, when it begins to dawn on local ratepayers and electricity consumers in towns which have the misfortune to have a Socialist majority what the Socialist Government have done, they are going to find this out to their cost. The time is coming when they will realise it, and it is intolerable that hon. Members should
    think that there is no call for discussion of a Clause which is doing for municipalities what a Clause we discussed earlier does for public companies—depriving them of compensation except to a totally inadequate extent.
    Sir Patrick Hannon: I wish to disclose at once that I have an interest in an electricity undertaking. The reason why I have not previously taken part in the Debate is because of my association with an electricity undertaking. This is a very important matter affecting the ratepayers of this country. It is planting upon them a measure of compensation which is wholly inadequate to the amount expened by the ratepayers in the organisation of electricity undertakings. In Birmingham we have one of the most successful electricity undertakings in the country and I challange hon. Members opposite who represent other constituencies in Birmingham to say that they are prepared to put an additional three shillings of four shillings on the rates by this means. I ask them to say how this figure has been arrived at. Was there consultation with the Association of Municipal Corporations, or with anyone competent to advise the Government on how this sum of £5 million has been fixed? I suggest this sum of £5 million to compensate municipal authorities for the amount they have expended in developing municipal undertakings is a travesty of fair play and fair dealing. This Clause should not be embodied in the Bill. The whole of this Bill is calculated from one stage to another to sacrifice the interest of this country for the development of an ideology introduced by His Majesty's Government for the first time in deplorable circumstances.
    Motion made, and Question put, "That the Clause, as amended, stand part of the Bill."
    The Committee divided: Ayes, 284; Noes, 99.

    Division No. 286.

    AYES.

    [9.54 p.m.

    Adams, Richard (Balham)

    Ayles, W. H.

    Benson, G

    Adams, W T. (Hammersmith, South)

    Ayrton Gould, Mrs B

    Berry, H.

    Allen, A. C. (Bosworth)

    Bacon, Miss A

    Beswick, F.

    Alpass, J. H.

    Baird, J.

    Bing, G. H. C

    Anderson, A. (Motherwell)

    Balfour, A

    Binns, J

    Anderson, F. (Whitehaven

    Barstow, P. G.

    Blenkinsop, A.

    Attewell, H. C.

    Battley, J. R.

    Blyton, W. R.

    Austin, H. Lewis

    Beattie, J. (Belfast, W.)

    Bowden, Flg.-Offr. H. W

    Awbery, S. S.

    Bechervaise. A. E

    Bowles, F. G (Nuneaton)

    Braddock, Mrs. E M. (L'pl. Exch'ge)

    Hobson, C. R.

    Proctor, W. T.

    Braddock, T. (Milcham)

    Holman, P.

    Pryde, D. J.

    Bramall, E. A.

    Holmes, H. E. (Hemsworth)

    Pursey, Cmdr. H.

    Brook, D. (Halifax)

    Horse, G.

    Randall, H. E

    Brooks, T J. (Rothwell)

    Hoy, J.

    Ranger, J.

    Brown, T J. (Ince)

    Hubbard, T.

    Reid T. (Swindon)

    Buchanan, G.

    Hudson, J. H. (Ealing, W.)

    Rhodes, H.

    Burke, W. A.

    Hughes, Hector (Aberdeen, N.)

    Ridealgh, Mrs. M.

    Carmichael, James

    Hutchinson, H. L. (Rusholme)

    Roberts, Emrys (Merioneth)

    Castle, Mrs. B. A.

    Hynd, H. (Hackney, C.)

    Roberts, Goronwy (Caernarvonshire)

    Champion, A. J.

    Hynd, J. B. (Attercliffe)

    Robertson, J. J. (Berwick)

    Chater, D.

    Irving, W. J.

    Rogers, G..H. R.

    Chetwynd, G. R

    Janner, B.

    Ross, William (Kilmarnock)

    Cobb, F. A.

    Jay, D P. T.

    Royle, C.

    Cocks, F. S.

    Jeger, G. (Winchester)

    Sargood, R.

    Collindridge, F.

    Jeger, Dr. S. W. (St. Pancras, S.E.)

    Scollan, T.

    Collins, V. J.

    Jones, D. T (Hartlepools)

    Segal, Dr. S.

    Caiman, Miss G. M.

    Jones, Elwyn (Plaistow)

    Shackleton, E. A. A

    Comyns, Dr. L.

    Jones, J. H. (Bolton)

    Sharp, Granville

    Corlett, Dr. J.

    Jones, P. Asterley (Hitchin)

    Shawcross, C. N. (Widnes)

    Corvedale, Viscount

    Keenan, W.

    Shinwell Rt. Hon E

    Cove, W. G.

    King, E. M.

    Shurmer, P

    Crawley, A.

    Kingdom, Sqn.-Ldr. E.

    Silverman, J. (Erdington)

    Daggar, G.

    Kinley, J.

    Simmons, C. J.

    Daines, P.

    Kirby, B. V.

    Skefington, A, M.

    Davies, Clement (Montgomery)

    Kirkwood, D.

    Skeffington-Lodge, T. C

    Davies, Edward (Burslem)

    Lang, G. Lavers, S.

    Skinnard, F W.

    Davies, Harold (Leek)

    Smith, C. (Colchester)

    Davies, Hadyn (St. Pancras, S.W.)

    Lee, F. (Hulme)

    Smith, H. N. (Nottingham, S)

    Davies, R. J. (Westhoughton)

    Leonard, W

    Smith, S. H. (Hull S. W.)

    Davies, S. O (Merthyr)

    Leslie, J R,

    Solley, L. J.

    Deer, G.

    Lindgren, G S

    Sorensen, R. W.

    Delargy, H. J.

    Logan, D. G

    Soskice, Maj. Sir

    Diamond, J.

    Longden, F.

    Sparks, J. A.

    Dodds, N N

    Lyne, A. W.

    Stamford, W

    Donovan, T.

    McAdam, W.

    Steele, T.

    Driberg, T. E. N.

    McEntee, V. La T.

    Stephen, C.

    Dugdale, J. (W. Bromwich)

    McGhee, H G

    Stewart, Michael (fulham, E.)

    Dumpleton, C. W.

    Mack, J. D.

    Stross, Dr. B.

    Durbin, E. F. M

    McKay, J (Wallsend)

    Stubbs. A E.

    Edelman, M.

    McKinlay, A. S.

    Sylvester, G. 0.

    Edwards, N. (Caerphilly)

    Maclean, N (Govan)

    Symonds, A. L.

    Edwards, W. J. (Whitechapel)

    McLeavy, F

    Taylor, H. B. (Mansfield)

    Evans, E. (Lowestoft)

    Macpherson, T. (Romford)

    Taylor, R. J. (Morpeth)

    Evans, John (Ogmore)

    Taylor, Dr S. (Barnet)

    Evans, S. N (Wednesbury)

    Mainwaring, W. H.

    Thomas, D. E. (Aberdare)

    Ewart, R.

    Mallalieu, J. P. W

    Thomas, I. O. (Wrekin)

    Fairhurst, F

    Mann, Mrs. J.

    Thomas. George (Cardiff)

    Farthing, W. J

    Manning, Mrs. L, (Epping)

    Thorneycroft, Harry (Clayton)

    Fernyhough, E.

    Marquand, H. A.

    Thurtle, Ernest

    Field, Capt. W J

    Mathers, G

    Tiffany, S.

    Fletcher, E. G M (Islington, E.)

    Medland, H. M

    Timmons, J.

    Follick, M.

    Mellish, R. J.

    Titterington, M. F

    Foot, M M.

    Middleton, Mrs. L.

    Tolley, L.

    Forman, J. C.

    Mikardo, Ian

    Tomlinson, Rt. Hon G

    Freeman, Maj. J, (Watford)

    Millington Wing-Comdr E. R

    Turner-Samuels, M.

    Gaitskell, H. T. N

    Mitchison, G. R

    Ungoed-Thomas, L

    Gallacher, W.

    Monslow, W.

    Vernon, Maj W. F.

    Ganley, Mrs C. S

    Moody, A. S

    Viant, S. P.

    Gibbins, J.

    Morgan, Dr H. B.

    Walkden, E.

    Gibson, C. W

    Morley, R.

    Walker, G. H.

    Giizean, A.

    Morris, Lt.-Col. H. (Sheffield, C)

    Wallace, G. D, (Chislehurst)

    Glanville, J. E. (Consett)

    Mulvey, A.

    Wallace, H W. (Walthamstow, E.)

    Goodrich, H. E.

    Murray, J. D

    Watkins, T. E.

    Gordon-Walker, P. C.

    Nally, W.

    Watson, W M.

    Greenwood, A. W. J. (Haywood)

    Neal, H (Claycross)

    Webb, M. 'Bradford C.)

    Grenfell, D. R.

    Nichol, Mrs. M. E. (Bradford, N.)

    Weitzman, D

    Crey, C. F.

    Nicholls, H. R. (Stratford)

    West, D. G.

    Grierson, E.

    Noel-Baker, Capt. F, E. (Brentford)

    White, H. (Derbyshire, N.E.)

    Griffiths, D. (Rother Valley)

    Noel-Baker, Rt. Hon P J (Derby)

    Whiteley, Rt. Hon. W.

    Griffiths, Rt. Hon. J (Llanelly)

    Noel-Buxton, Lady

    Wigg, Col, G. E.

    Griffiths, W D. (Moss Side)

    Oldfield, W. H.

    Wilkins, W. A.

    Guest, Dr. L. Haden

    Oliver, G. H

    Willey, F. T. (Sunderland)

    Gunter, R J.

    Orbach, M

    Williams, J. L. (Kelvingrove)

    Guy, W. H

    Paget, R T.

    Williams, Rt. Hon. T. (Don Valley)

    Hale, Leslie

    Paling, Rt. Hon. Wilfred (Wentworth)

    Williams, W R. (Heston)

    Hall, W. G.

    Paling, Will T. (Dewsbury)

    Willis, E.

    Hamilton, Lieut.-Col. R.

    Palmer, A. M. F

    Wills. Mrs. E.A

    Hannan, W (Maryhill)

    Pargiter, G. A

    Woodburn, A

    Hardy, E. A.

    Parker, J.

    Wyatt, W.

    Harrison, J.

    Parkin, B T

    Yates, V. F

    Hastings, Dr Somerville

    Paton, J. (Norwich)

    Young, Sir R. (Newton)

    Haworth, J

    Pearson, A.

    Younger, Hon. Kenneth

    Henderson, A (Kingswinford)

    Peart, Thomas F.

    Zilliacus, K.

    Henderson, Joseph (Ardwick)

    Poole, Major Cecil (Lichfield)

    TELLERS FOR THE AYES:

    Herbison, Miss M.

    Porter, G. (Leeds)

    Mr. Snow and Mr. Popplewell

    Hewitson, Capt. M

    Price, M. Philips

    562

    563

    NOES.

    Amory, D. Heathcoat

    Hannoh, Sir p. (Moseley)

    O'Neill, Rt. Hon. Sir H

    Assheton, Rt. Hon. R

    Haughton, S. G.

    Orr-Ewnig, l. L.

    Astor, Hon. M.

    Headlam, Lieut.-Col. Rt. Hon, Sir C

    Osborne, C.

    Baldwin, A, E.

    Henderson, John (Cathcart)

    Peto, Brig. C. H. M.

    Bennett, Sir P,

    Hinchingbrooke, Viscount

    Pickthorn, K

    Birch, Nigel

    Hollis, M. C.

    Ponsanby, Col. C. E.

    Boles, Lt.-Col. D. C. (Wells;

    Hudson, Rt. Hon. R. S (Southport)

    Poole, O B. S. (Oswestry)

    Bossom, A. C.

    Hurd, A.

    Prescott, Stanley

    Bower, N.

    Hutchison, Lt.-Cm. Clark (E'b'rgh W.)

    Prior-Palmer, Brig. 0.

    Boyd-Carpenter, J. A.

    Hutchison, Col. J. Ft (Glasgow, C.)

    Raikes, H. V.

    Braithwaite, Lt.-Comdr. J. G.

    Jarvis, Sir J

    Reid, Rt. Hon. J. S C. (Hillhead)

    Bromley-Davenport, Lt.-Col. W.

    Keeling, E. H.

    Roberts, Maj. P. G (Ecclesall)

    Challen, C.

    Lambert, Hon. G

    Robinson, Wing-Comdr Roland

    Clarke, Col. R. S.

    Lancaster, Col. C. G

    Ropner, Col. L.

    Clifton-Brown, Lt.-Col. G.

    Langford-Holt, J.

    Ross, Sir R. D. (Londonderry)

    Crosthwaite-Eyre, Col. O. E

    Legge-Bourke, Maj. E. A. H

    Sanderson, Sir F.

    Crowder, Capt. John E

    Lindsay, M. (Solihull)

    Scott, Lord W.

    Cuthbert, W. N.

    Lipson, D L.

    Smiles, Lt.-Col. Sir W

    Davidson, Viscountess

    Lucas-Tooth, Sir H.

    Spearman, A. C. M

    Digby, S. W

    MacAndrew, Col. Sir C.

    Spence, H. R.

    Codds-Parker, A. D

    Mackeson, Brig. H. R.

    Stanley, Rt Hon. C

    Donner, Sqn.-Ldr. P W.

    Maclay, Hon J. S.

    Sutcliffe, H.

    Dower, Lt.-Col A. V. G. (Penrith)

    Macpherson, N. (Dumfries)

    Thorneycroft, G. E. P. (Monmouth)

    Dower, E. L. G (Caithness)

    Maitland, Comdr. J W.

    Thornton-Kemsley C. N

    Drayson, G. B.

    Marples, A. E.

    Thorp, Lt.-Col. R. A. F

    Drewe, C.

    Marshall, D. (Bodmin)

    Vane, W. M. F.

    Elliot, Rt. Hon. Walter

    Marshall, S. H (Sutton)

    Wakefield, Sir W. W.

    Foster, J. G (Northwich)

    Mellor, Sir J.

    White, Sir D. (Fareham)

    Fraser, H. C P. (Stone)

    Molson, A. H E.

    White, J. B. (Canterbury)

    Fyfe, Rt Hon. Sir D P M

    Morris, Hopkin (Carmarthen)

    Williams, Gerald (Tonbridge)

    Gage, C.

    Morrison, Rt. Hon W. S (Cirencester)

    York, C.

    George, Maj. Rt. Hn G Lloyd (P'ke)

    Mott-Radclyffe, C. E.

    Grant, Lady

    Neven-Spence, Sir B

    TELLERS FOR THE NOES:

    Gridley, Sir A

    Noble, Comdr. A. H. P.

    Mr. Studholme and Majo Conant.

    Question, "That the Clause be read a Second time," put, and agreed to.

    CLAUSE 20.—(Further compensation to local authorities in respect of capital works.)
    Amendments made: In page 30, line 9, after "borrowed," insert "or advanced."
    In line 16, leave out from "expenditure," to end of Clause, and add:
    "in respect of which the Central Authority are liable to make payments under Subsection (3) of the last foregoing Section."—[The Solicitor-General.]
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 21.—(Control of dividends, interest and other payments.)
    Mr. Glenvil Hall: I beg to move, in page 33, line 8, at the end, to add:
    "(10) This Section shall, in relation to any composite company, have effect subject to the following modifications: —

    (a) Subsections (i), (4) and (5) shall only apply to payments and distributions made, and redemptions carried out, before the vesting date;

    (b) any liabilities arising under this Section shall be liabilities of the company and not of the directors; and

    (c)any such liability shall be reduced by applying thereto the proportion ascertained under paragraph (6) of Subsection (1) of the Section (Compensation to composite companies) of this Act."

    564
    This Amendment is essential because, later on, we are going to approve two new Clauses which deal with splitting where composite companies are concerned, and this Amendment applies the provisions of this Clause to the new set-up to which I think the Committee will agree. There is one slight difference to which I might call attention, and that is that, although this Clause subjects the new composite companies to the same restrictions and limitations, a company, in this case, and not the directors, will be liable for any infringement of rights. Recovery will only be possible on that part of the assets which is attributable to the electricity undertaking, and not some other part, such as gas, water, or whatever it may be.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 22.—(Final payment of dividends and interest.)
    Amendment made: In page 33, line 11, after "authority," insert "or a composite company."—[Mr. Shinwell.]
    The Solicitor-General: I beg to move, in page 35, line 35, at the end, to insert:

    565
    "(10) The following provisions shall have effect in the case of a composite company, that is to say:—

    (a) no part of the cash and investments of the company representing the net revenue of the company for the final financial period shall vest by virtue of this Act in an Electricity Board;

    (b) there shall be ascertained as soon as possible after the vesting date the amount required to enable the company to make payments of interest or dividend in respect of the final financial period on all their securities at the full rates permitted under the last foregoing Section, assuming that the statutory or other provisions relating to the company permitted payments of interest or dividend in respect of that period and due regard being had to any interest or interim dividend already paid in respect of that period; and

    (c) if the total value of all the cash and investments referred to in paragraph (a) of this Subsection exceeds the amount ascertained under paragraph (b) of this Subsection, the company shall pay to the Central Authority such part of the excess as bears to the whole thereof the proportion ascertained under paragraph (b) of Subsection (i) of the Section (Compensation to composite companies) of this Act."

    Mr. R. S. Hudson: I should like to have an explanation of this Amendment.
    Mr. Glenvil Hall: Briefly, this Amendment deals with a Clause with which the Committee is not yet familiar, and that does, of course, make our proceedings a little difficult, and for it, in so far as I am responsible, I apologise. Broadly speaking. Clause 22 provides that, after the vesting date and a company having been dissolved, the stockholders' representatives shall pay the dividends and interests to those entitled to them. Here, of course, with the composite companies, there will be no stockholders' representative and the Minister will deal direct with the company concerned. This Amendment makes the necessary alterations in this Clause to provide for that fact.
    Mr. Hudson: We are obliged to the right hon. Gentleman, but he will not be surprised if I comment on how much simpler this procedure is than the other, and how much better it would have been, and how much time would have been saved, if he had applied this simple procedure to all other companies, instead of confining it to composite companies.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 23.—(Income Tax provisions.)
    Mr. Glenvil Hall: I beg to move, in page 36, line 14, after "authority," to insert, "or a composite company."
    Here, again, this is a consequential Amendment to a Clause which has not yet been reached, but which I hope the Committee will accept when we do reach it.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 24.—(Re-opening of transactions resulting in dissipation of assets.)
    Amendment made: In page 38, line 38, at end, insert:
    "(7) This Section shall, in relation to a composite company, only apply to transactions entered into by the company in their capacity as authorised undertakers, and the company, and not the directors, shall be made parties to applications under this Section."
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 25.—(Provisions as to foreign investments.)
    Mr. Glenvil Hall: I beg to move, in page 38, line 45, after "applies," to insert:
    "other than a composite company."
    This, again, is consequential.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 26.—(Establishment of Electricity Arbitration Tribunal.)
    The Solicitor-General: I beg to move, in page 39, line 40, to leave out Subsection (2), and to insert:
    "(2) The arbitration tribunal shall, as the Lord Chancellor may direct, either sit as a single tribunal or sit in two or more divisions, and shall, for the hearing of any proceedings, be constituted as follows: —

    (a) one member shall be a person of legal experience and he shall be the president of the tribunal;

    (b) there shall be two other members of whom one shall be a person of experience in business and the other shall be a person of experience in finance;

    Provided that, in relation to any proceedings which, under the provisions of Subsection (4) of this Section, are required to be held in Scotland, the member who is a person of legal experience shall be a person of legal experience in Scotland.

    567
    (3) The members of the tribunal shall be appointed by the Lord Chancellor, except that any member or members appointed as being a person or persons of legal experience in Scotland shall be appointed by the Lord President of the Court of Session, and any member appointed by the Lord President shall only act in relation to proceedings which are required as aforesaid to be held in Scotland."
    This Amendment is designed to carry out an undertaking given during the Committee stage of the discussions when we were looking at the Clause which deals with the constitution of the Arbitration Tribunal. Hon. Members then pressed me to accept the principle that the arbitration tribunal should sit, in case of need, in two or more divisions. As the Clause reads at the moment, only one division is provided for, and the Amendment carries out the undertaking which I gave to consider whether that would be possible by providing that there shall be power vested in the Lord Chancellor to direct that the tribunal shall sit in one or more divisions according to need.
    Mr. J. Foster: I would like to ask the hon. and learned 'Solicitor-General what he has in mind in connection with the words "legal experience." It is usual to say in such a Clause that it must be a solicitor with so many years' experience. Has the hon. and learned Gentleman in mind persons other than barristers and solicitors, such as people who have been town clerks, and so on? Perhaps the Minister has a particular definition in mind.
    Mr. Boyd-Carpenter: I am very glad that the Solicitor-General has moved this Amendment which, as he says, is in response to representations which were very strongly made in Committee. The only point I wish to make is that in resisting a very similar Amendment in Committee, he said that there would not be sufficient work to justify the tribunal sitting in two divisions. Does this change of front on the part of the Government mean that they have altered their view on that, and is there any reason now to apprehend that there will be more work than was then thought, and, if so, what will be the nature of that work?
    Mr. Sidney Marshall: When the hon. and learned Solicitor-General is making his reply about the words "legal experience,"
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    perhaps he will also say what is meant by:
    "a person of experience in business"
    and by:
    "a person of experience in finance
    I had an idea that they were closely associated. This is the first time that I have seen them so closely dissociated, and it would be interesting to hear the hon. and learned Gentleman give a definition of the two different classes.
    The Solicitor-General: That is a real poser. In Committee today, I think I heard ah hon. Gentleman opposite, who is a member of a number of important companies, say that he had to have lessons from his accountant before he could face his shareholders with his accounts. He is a man of business with the greatest experience. The accountant, perhaps, was more experienced in finance. I think that that, perhaps is the best example I can give. With regard to the question asked by the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter), we have no reason to apprehend that there will be more work now than we had in mind then. We have framed this Clause as an enabling Clause in case there is a sufficiency of work to occupy the tribunal sitting in one, two or more divisions. The Lord Chancellor is given power to appoint it in two or more divisions. As to the question about "legal experience," it is proposed that those appointed should be, at any rate, barristers or solicitors.
    10.15 p.m.
    Mr. R. S. Hudson: I am obliged to the Solicitor-General for this Amendment, which goes a considerable way towards meeting one of the points which we raised in Committee. I do not know whether it would save time, although I might be slightly out of Order, if I referred to one other point on this Clause to which we took exception in Committee, and that was in relation to Subsection (6). The Solicitor-General will remember that we said we thought the solution would be to give the Government or the Lord Chancellor power to set up a tribunal with sub-tribunals in order to get over the difficulty of entrusting the work to a single tribunal. They have met us to the extent of taking power to set up additional or sub-tribunals, and I am wondering if it has been due to an oversight that Subsection

    569
    (6) has been left in, or whether the Solicitor - General would consider at another stage omitting that Subsection.
    The Solicitor-General: Unless my recollection plays me false, in the Committee I suggested that a good way out of the difficulty would be if we accepted the proposal that we made by hon. Members opposite that there should be power to appoint the tribunal in two or more divisions, and if, at the same time, we retained Subsection (6) which gives power to refer, because it might often be extremely convenient to use the power to refer particular matters to referees. If my memory does not play me false, the solution that I proposed, and which I understood was accepted by hon. Members opposite, was that we should have both— that we should have the power for a tribunal to be appointed to sit in two divisions, and, in case we wanted to use it, we should retain the power to refer matters under Subsection (6). However, I intend to look at the OFFICIAL REPORT in order to see if my recollection is wrong, although I do not think it is.
    Mr. Boyd-Carpenter: If the Solicitor-General will look at column 840 in the OFFICIAL REPORT of the r8th day's proceedings, he will see that he submitted the procedure under Subsection (6) as an alternative to the proposal which we moved, and which is substantially the same as the Amendment which the Government are now moving.
    Mr. R. S. Hudson: Perhaps I might be allowed to quote what the Solicitor-General said. He said at column 840:
    "What we have done is to try to adopt an alternative system."—[OFFICIAL REPORT, Standing Committee E; 1st May, 1947; c. 840.]
    He regarded Subsection (6) as an alternative to our proposal. I do not wish to press the matter now, but perhaps the Solicitor-General will look into it and arrange for the necessary alteration to be made in another place.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 29.—(Determination of questions as to application of Part of this Act.)
    Mr. Gaitskell: I beg to move, in page 43, line 24, to leave out from "body," to "this," in line 25, and to insert:
    570
    "who in his opinion are a power station company or electricity holding company to whom."
    This and the next three Amendments are consequential.
    Amendment agreed to.
    Consequential Amendments made.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 30.—(Power to obtain information.)
    Mr. Gaitskell: I beg to move, in page 44, line 34, at the end, to add:
    "(2) Regulations made under this section shall make provision for the payment to any such body of expenses reasonably incurred by them in complying with any requirements made by or under the regulations."
    This new Subsection which is to be added to Clause 30 enables bodies from whom information is sought by the Minister or Secretary of State or one of the electricity boards to have expenses paid that are reasonably incurred by the bodies concerned for obtaining the information the Minister or other persons require. This is in response to a request made by the Opposition during the Committee stage.
    Mr. J. Foster: I would ask the Parliamentary Secretary who is to check whether the expenses have been properly incurred? Am I right in assuming that the Ministry will reimburse the costs where the Minister asks for information?
    Mr. Gaitskell: Those are both points that will have to be dealt with in the regulations. I think myself that it would be proper that the Minister should reimburse the costs, where the Minister is seeking the information, and the electricity boards, where it is the electricity boards who are seeking the information.
    Mr. J. Foster: I would ask your guidance, Major Milner. I should have thought that that did not come under the Money Resolution. The Parliamentary Secretary has just said that the costs will have to be paid by the Minister.
    Mr. Gaitskell: They might be.
    Mr. Foster: The hon. Gentleman said they should be; and, obviously, if you look at the Clause, Major Milner, no other body could pay them. The Clause says that the information can be obtained if asked for by the Minister or

    571
    Secretary of State or any electricity board; but in no part of the Money Resolution is there any indication that the Minister should reimburse expenses to a body. The Money Resolution in paragraph (c) states a number of persons whose expenses can be reimbursed, but to none of those bodies. I should like your guidance, on a point of Order, Major Milner, whether this is in Order, as coming within the Money Resolution.
    Mr. Gaitskell: I only want to make it plain. I am sorry about this difficulty, if there is a difficulty, because we are only doing this to meet the views of hon. Members opposite. But I should like to point out that I did not say the Ministry would necessarily pay. I did offer an expression of opinion that it might. It is perfectly plain from Clause 30 that the information may reasonably be required by any electricity board, under paragraph (b). My attention has just been drawn to the fact that in the Money Resolution at the end—
    Mr. Foster: Yes, sub-paragraph (vi) of paragraph (c).
    Mr. Gaitskell: It states:
    "administrative expenses incurred by any Minister of the Crown or Government Department."
    I think that meets the point.
    Mr. Foster: Clearly, it does not cover all these costs. The Amendment says the exact opposite. It says regulations may be made under the Clause to make provision—
    "for the payment to any such body of expenses reasonably incurred by them"
    Sub-paragraph (vi) of paragraph (c) of the Money Resolution says:
    "the administrative expenses incurred under the said Act by any Minister of the Crown."
    How in the world is an expense incurred by a body under that sub-paragraph? It can only apply if this Amendment is carried. But the Money Resolution does not allow the Amendment to be put in. If the Amendment is carried, the expenses which are incurred by the Board should be payable by the Minister and then, of course, they are incurred by the Minister in that sense. But that would mean that any Money Resolution would be useless. All that a Money Resolution would need would be, at the beginning,
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    words to the effect that it shall cover any expenses incurred by the Government. One could do anything in a Bill in that way, and say that the expenses are covered by the Money Resolution. That is nonsense.
    The Chairman: I am inclined to think that the Amendment is in Order, and that the Money Resolution does cover the point. In any event, I understand that the Parliamentary Secretary has given his assurance that that is so.
    Lieut.-Colonel Elliot: I do not mind government by assurance, but I do object to finance by assurance. I should have thought that the Minister's assurance, that he would find the money, is not quite enough for the House of Commons. We know that it caused the Minister a good deal of trouble—
    The Chairman: It was not the Minister's assurance that he would find the money. He assured the Committee that he was advised by competent authority that the matter was within the Money Resolution, and I accept that assurance. As far as I can see, the Money Resolution is an extremely wide one, but if on further examination it turned out that the matter was not within the Resolution, then the question would arise again and there will be an opportunity for discussion at a later stage. I think that is the only way the matter can be dealt with on the spur of the moment.
    Lieut.-Colonel Elliot: Could you tell us, Major Milner, for our guidance, on what occasion exactly could it be dealt with when the Bill has passed from this House? Because finance is the prerogative of this House. Surely, it would be out of order for an Amendment dealing with finance to be introduced in Tiother place? Or it that some amending legislation of one kind or another would need to be introduced? I think the explanations are a little unconvincing..
    Mr. Glenvil Hall: The right hon. and gallant Gentleman knows very well what would happen. He has, I believe, occupied the position I now have the honour to occupy. He knows—none better—that one of two things would happen. If it was outside the Money Resolution the money would not be paid, it spite of what was said in the Bill; or, the Government of the day would take the first available opportunity to put the matter

    573
    right by moving another Money Resolution, which this House would or would not accept.
    Lieut.-Colonel Elliot: That is to say, amending legislation; because, of course, once the Bill is on the Statute Book the Money Resolution cannot be altered. The right hon. Gentleman says, what is quite true, that we are discussing a matter which is of some interest to both of us, as we have both occupied the position of Financial Secretary. He is saying, in the first place, that he is not able to assure us that the money would in fact be paid. The right hon. Gentleman put that as a hypothesis—
    Mr. Shinwell: The right hon. and gallant Gentleman put that forward.
    Lieut.-Colonel Elliot: It was the Financial Secretary's hypothesis, if I may say so? I certainly do not wish to delay the Committee.—[Interruption.]—Really, we have co-operated with the Government whole-heartedly. It would be no difficulty at all to delay the proceedings, but we are not delaying them at all. We are dealing with a financial point made by my hon. Friend the Member for Northwich (Mr. J. Foster). It is of great importance to the House of Commons that financial business should not be conducted in a slipshod manner. We have the assurance of the Minister, but that does not go the whole way. Certainly he has indicated to the Committee the steps that would have to be taken if it were found, after all, that the solution he has put for ward was not an adequate one. That is an answer to my hon. Friend, whose point was very justly taken. It is quite right for a young Member to inform himself upon these matters when the Bill is before this House for consideration.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 34.—(Borrowing powers of Central Authority and Area Boards.)
    Mr. Glenvil Hall: I beg to move, in page 47, line 33, after "authority," to insert:
    "in respect of severance or."
    This is an Amendment preliminary to a proposed new Clause (Further compensation to local authorities in respect of severance)—with which we shall be deal-
    574
    ing later and which provides for the sum of £5 million to be paid to local authorities. This Amendment enables that money to be borrowed, if necessary.
    Mr. R. S. Hudson: I have not had a chance to appreciate fully what the repercussions are. May we take it that acceptance of this Amendment will not prevent a full discussion of our case on the proposed new Clause, which, of course, will be based on the suggestion that severance should not be the only expenditure to be compensated for, and that the amount of £5 million is wholly inadequate, because a lot of other things should be included in the expenditure for which local authorities are to be compensated?
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 35.—(British Electricity Stock.)
    10.30 p.m.
    Mr. Glenvil Hall: I beg to move, in page 48, line 19, to leave out from "compensation," to end of line 21, and insert:
    "which, under any provision of this Act, is expressly required to be satisfied by the issue of stock."
    This, again, is an Amendment in anticipation of the Committee's accepting the new Clauses with which we shall be dealing later. This particular Clause deals with British electricity stock and applies provisions to that stock which do not apply in the case of such companies at present.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 37.—(Treasury guarantees.)
    Amendment made: In page 49, line 21, leave out from "satisfying," to "shall," in line 22, and insert:
    "any right to compensation which, under any provision of this Act, is expressly required to be satisfied by the issue of stock."—[Mr. Glenvil Hall.]
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 50(Application, amendment and repeal of enactments relating to electricity supply.)
    The Solicitor-General: I beg to move, in page 61, line 28, to leave out from "undertakers," to "shall," in line 29, and to insert:

    575
    "except enactments applicable to local authorities or composite companies otherwise than in their capacity as authorised undertakers."
    This is an Amendment to a Clause which adapts to the Boards enactments which previously referred to undertakings. This effects a small amendment in Subsection (3). It provides that local enactments shall be adapted, other than those which refer to composite companies or local authorities in their capacity otherwise than as a statutory electricity undertaking.
    Mr. R. S. Hudson: I am obliged to the hon. and learned Gentleman, but I am not sure that his description of this Amendment is absolutely accurate. I should have thought its object was to correct a mistake in Government drafting to which attention was called by the Opposition.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    CLAUSE 59.—(Interpretation.)
    The Solicitor-General: I beg to move, in page 67, line 44, to leave out from "the," to the end of line 47, and to insert:
    "bodies specified in the Schedule (Authorised undertakers to whom Part II of Act applies) to this Act, and any reference in this Act to the capacity of a local authority as authorised undertakers shall be construed as a reference to their capacity as a body authorised by any enactment to supply electricity in an area of supply."
    This effects a slight alteration in respect of various undertakers rendered necessary by the new Clause on the Order Paper and of bodies to which Part II of the Act applies.
    Amendment agreed to.
    The Solicitor-General: I beg to move in page 68, line 9, at the end, to insert:
    "'electricity holding company 'has the meaning assigned to it by the section (Bodies to whom Part II of Act applies) of this Act."
    This is an amendment of definition consequential upon the introduction of the new Clause.
    Amendment agreed to.
    Further Amendments made: In page 69, line 7, at end, insert:
    "'holding company' shall be construed in accordance with the definition contained in any Act of the present Session amending the law relating to companies."
    In page 70, line 19, leave out from first "company," to end of line 22, and insert:
    576
    "has the meaning assigned to it by the section (Bodies to whom Part II of Act applies) of this Act."
    In line 38, at end, to insert:
    "'subsidiary company' shall be construed in accordance with the definition contained in any Act of the present Session amending the law relating to companies."—[Mr. Glenvil Hall.]
    Clause, as amended, ordered to stand part of the Bill.

    NEW CLAUSE.—(Further compensation to local authorities in respect of severance.)
    There shall be paid by the Central Authority to local authorities, by way of compensation in respect of the severance of their electricity undertakings from their other activities, the sum of five million pounds, and the said sum shall be divided among such of the said local authorities as satisfy the prescribed conditions, and the amounts to be paid to the individual authorities shall be determined in such manner and in accordance with such principles as may be prescribed.—[Mr. Glenvil Hall.]
    Brought up, and read the First time.
    Mr. Glenvil Hall: I beg to move, "That the Clause be read a Second time."
    This is a Clause to which the Committee may perhaps desire to give some consideration. It has created a considerable amount of interest in all quarters of the Committee and among local authorities outside. It proposes to set aside £5 million to compensate local authorities for the severance of the electricity undertakings which, under this Bill, are to be taken from them and vested in the Central Electricity Authority. It also provides for the promulgation later on of regulations which will deal with distribution. Right hon. and hon. Members may ask why we want to make this provision. It arises partly out of a promise given by my right hon. Friend the Minister of Fuel and Power when we dealt with this matter in Committee upstairs. The question was raised by hon. Members on the other side of the Committee, as well as on this side, and local authorities have represented to them and to my right hon. Friend that when they lose their electricity undertakings, some of them will be involved in losses of one kind or another. It is their suggestion that provision should be made for what might be described as legitimate losses for which compensation should be paid.

    577
    These losses, I think, can be listed under five heads. First, loss to the rates; that is, the loss of right to use the profits of an undertaking in the relief of rates. Secondly, loss of the benefit of income tax set-off—a new loss which, in the case of local authorities, has only accrued in recent years. Thirdly, there is loss of contributions towards central establishment charges and other overheads, and then, to a lesser degree, there is the loss that may result from the unbalancing of superannuation funds owing to loss of staff the taking away of an electricity undertaking. Then there has been a loss —or so some of them say—resulting from local authorities being left to bear management expenses on loans raised for their electricity undertakings.
    Before I come to the main items let me say that so far as the last two items are concerned they are adequately covered in the Bill or by Amendments made by my right hon. Friend during the passage of the Bill through the House. Superannuation is covered under Clause 48, which deals with the provision of pension rights. Clause 19 deals with the compensation to local authorities to cover loan charges as, of course, the Committee know very well, because we dealt with it and argued about it half an hour ago. Now what about the others ? First of all, there is the contribution to rates. It is true that, within limits, a local authority which has an electricity undertaking can so arrange its affairs that its electricity undertaking can make a contribution, and sometimes a substantial contribution, in aid of the local rates. Some authorities, we find, do this regularly, others occasionally and many, not at all. Some in fact, instead of helping the rates by paying over yearly a part of the profits made on their electricity undertaking, actually have to receive a subvention from the rates to assist their electricity undertaking, I have figures here which, I hope, will interest the Committee and which give a good picture of just what is involved under this particular head. There are 74 who are assisting the rates to the tune of £309,000 and, on the other side, there are 10 who receive aid from the rates to the tune of £230,000. They do not, of course, actually balance but when you take one from the other the difference is only a matter of £80,000.
    Sir P. Hannon: I assume these are aggregate figures covering the whole 188, one way or the other?
    Mr. Glenvil Hall: The point I am making—and I think the Committee would like to be quite clear about this— is that when it comes to the question of the rates being helped by the municipally owned electricity undertakings, the vast majority of them do not get anything out of it at all. In 10 cases the rates have to go to the aid of the electricity undertaking to the extent, in bulk, in 1942–43 of £230,000. On the other hand, to be quite fair, there were 74 local authorities who did assist the local rates to the tune of £309,000 and it is not to be wondered at, at first blush, that those who have been enjoying that help should feel that something should be done if we are to take the electricity undertaking from them and that help to the rates is to come to an end. It is the Government's view that, whatever other help should be given, it is quite impossible, on grounds of policy apart from anything else that we should assist local authorities who, when this transfer takes place, are going to lose help from the rates. In the last analysis, when one authority regulates its activities so closely that it either ploughs back what it makes into the electricity undertaking or passes the profit on to the consumer of electricity, it would be wrong for us when dividing up any sum which may be provided by Parliament, to take into account the fact that other authorities are charging their consumers more than they need and assisting the rate's. We should only be helping the ratepayers at the expense of the consumer, and I hope that the Committee will share that view and agree with us that, whatever else should be compensated for when severance takes place, we cannot compensate for loss of aid to the rates.
    10.45 p.m.
    Now what about the Income Tax setoff? It is only in the last year or two that local authorities have been able to enjoy what all individuals have enjoyed for quite a long time, the setting off of any interest which they pay on loans against Income Tax which, year by year, they pay to the Inland Revenue. The fact that this concession has now been broadened out and may be applied to local authorities has meant that certain local authorities now say that, when they

    579
    come to lose their electricity undertaking, their inability in future to make this set off against their other trading activities will entail a loss. This obviously comes into a slightly different category from that in which we put the direct loss to the rates; and although we do not recognise it as of prime importance in the claims put forward on behalf of local authorities, we agree that, in some instances at any rate, there will definitely be a loss. It is true that where there are local authorities with many trading activities, this question of the set off of Income Tax can make a considerable difference in the course of the year.
    Now for a few moments let me deal with what we think is the main grounds upon which local authorities should be assessed when severance takes place, and that is the loss of contribution to central establishment charges which they will undoubtedly suffer. The losses under this head will quite obviously be general, whereas in the previous categories I have spoken about, losses will vary from local authority to local authority. It is obvious that all local authorities that have, at the moment, electricity undertakings, will, when they lose it suffer a loss of contributions from that undertaking to the central establishment charges of the local authority. Trading undertakings make an agreed contribution to the local authorities in respect of legal assistance, house room, office accommodation, and of help given by the engineering department. Usually the finance office also assists the electricity undertaking, which pays to the local authority to which it belongs a sum to cover overheads of that kind, and legitimately so. Severance will mean that these overheads will have to be spread over a smaller number of departments and activities carried on by the local authority and, as I say, we do feel that there is legitimate ground for complaint and for compensation. Now, as we see it, and I hope I carry right hon. and hon. Gentlemen opposite with me, this loss of overheads, in respect of establishment charges, will not be a permanent loss—in our view it is a loss which can be tapered off gradually. Accommodation, for instance, if it is not wanted, can be given up to other people who can use it, who will, undoubtedly, pay rent
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    for it. But we have made inquiries and we have found that the estimated loss by local authorities 'Under this particular head is between half a million and one million pounds per year. That would be the rate of loss at present. But as staff is transferred, office accommodation is given up, and other arrangements are made, the loss would be a diminishing one.
    We have assumed that the loss is something between half a million and a million pounds a year. What my right hon. Friend has done is this: he has taken the figure presented to him on behalf of the Association of Municipal Corporations and suggested that the round figure of £5 million—roughly five years at one million pounds a year, taking the basic figure as one million, not the lower of half a million in respect of severance charges under this particular head—would be doing justice to the local authorities.
    Mr. Lipson: May I ask the right hon. Gentleman a question? He is not making the point, is he, that the sum of £5 million for severance is acceptable to the Association of Municipal Corporations?
    Mr. R. S. Hudson: I was just about to ask the same question. The sum suggested by the Association of Municipal Corporations, I take it, is the half million and the million pounds and not the £5 million?
    Mr. Glenvil Hall: I am very happy to be corrected. I am very sorry. So far as we can gather amongst municipalities the present loss from severance under this head would be approximately from half to a million pounds a year and I was taking that figure and that was the sense in which I meant to use the phrase. I was not suggesting for a moment that we carried the whole of the municipalities of this country with us in our suggestion that the compensation to be divided between those who are to lose their electricity undertakings should be a sum of £5 million. I was trying to explain that on a rough and ready basis we were assuming that over the period' of five years most of these undertakings could so readjust their activities as to absorb their staff. And I may say, by way of parenthesis, some of the staff, at any rate, will pass with the electricity undertaking to the Central Electricity Authority.
    Sir P. Hannon: Will the right hon. Gentleman forgive me for one moment? I apologise for having to interrupt him. What was the scope of the inquiry which was made here? Did consultations take place in arriving at this sum and were the Association of Municipal Corporations excluded from that inquiry?
    Mr. Glenvil Hall: Very much otherwise. We have been very closely in touch with the Association. I would like to take this opportunity—I intended to do this at a later stage but the hon. Gentleman has given me the opportunity now—on behalf of His Majesty's Government to pay a tribute to the officials and representatives of the Association who have been most co-operative and helpful in this matter. We are anxious to see that justice is done, and we have been in very close touch with that body. Far from excluding them, the actual reverse has been the case. I do not want to mislead the Committee by pretending that the Association agreed to this sum. It is the sum we suggested, and in our view, if the agreed basic figure is taken over a period of five years, the resultant sum is adequate to compensate for most of the losses which the authorities will suffer, not taking account of losses in aid to the rates.
    It might be convenient if I dealt here with how this sum is to be distributed. In the Clause we leave that to regulations to be made by my right hon. Friend the Minister. The reason why it is left for regulations to be made later is in the hope that we can come to some arrangement with the Association of Municipal Corporations. I freely confess to the Committee that we have not yet been able to find a formula which entirely meets their wishes. Various bases have been explored. Should we adopt units sold as the basis, or revenue earned, or a combination of the two, or management expenses that is charges allowed by the Inland Revenue under Rule 36, which, I am sure, are familiar to everyone here who is also interested in municipal life.
    Unfortunately—I am sorry to say this —although every effort has been made by both sides, agreement has not yet been reached as to the best formula by which this money can be distributed amongst those who will be entitled to it. The fact is that regulations have to be made. They can be and will be made, but my
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    right hon. Friend does for the moment leave the matter open. I can assure the Committee that we shall lose no time in our efforts to try and reach agreement with the local authorities.
    To sum up—it seems to us a hopeless task to try to apportion, adequately, absolutely and exactly, compensation according to the precise degree of loss resulting from severance. We can only do rough justice and take what we think are legitimate claims, assess them and then distribute an equitable sum according to-a formula yet to be devised. There are some 350 separate cases and if we had to fight each one of them through the often-suggested method of an independent tribunal it would take a very long time. It would be much better, if we possibly can, to fix a sum and -then agree, if we can, on the method by which it should be distributed. One thing I would ask the Committee to remember in all seriousness, in the discussion that will follow the introduction of this new Clause, is that there is to be a revision of the block grant. There will be new block grant proposals partly as the result of the transference of the health services under the Act familiar to us all. Many authorities will benefit very greatly at the expense of the Exchequer by the changes that these proposals will bring and so the general level of rates throughout the country will appreciably be reduced. This new block grant will take all sorts of things into calculation, though not, as such, the loss from severance. But when severance has taken place the new block grant will even out the rate level between authorities whatever the reason for the differences may be.
    If the Committee would remember that and realise that my right hon. Friend has done his best on the information available, I think we can give, at any rate, rough justice to the local authorities who are losing these undertakings. If they realise that, and agree to this Clause, I am sure local authorities will in the end realise we have done our best, and will accept the Committee's decision.
    11.0 p.m.
    Mr. Hobson: I fully appreciate the representations that have been made by the Association of Municipal Corporations and it is true to say that £5 million divided among the 350 local authorities is not going

    583
    to allow them very much. It is not always appreciated that many local authorities have paid the charges on such things as their library services from their lighting funds. Great play has been made about authorities which subsidise their rates through electricity undertakings, but those which have subsidised to the greatest extent are those authorities which possess selective stations and are able to take advantage of Sections 12 and 13 of the 1926 Act—which are repealed in the Schedule to this Bill—and have been able to exploit the authorities which have not got selective stations. That is where they have got the surplus revenue to subsidise their rates.
    A further point which has been overlooked is this. Electricity consumers and ratepayers are not necessarily synonymous. Therefore, I think the Government are being exceedingly generous. But I would far rather they had left the Bill in its original form. I am rather surprised that the Minister has been persuaded by the representations that have been made, because I know there are people who argue that because compensation was given to stock holders compensation should be given to the local authorities. But these people fail to realise the fact that under the Act of 1882 and the Act of 1896 it was presupposed that electricity would be publicly owned and that the local authorities did not enter the electricity business for the sake of making profit. Why, therefore, do they at this late hour wish to make a profit? I am very surprised that the Minister has seen fit to pay £5 million. I appreciate this is an unpopular view but, nevertheless, the fact remains that it is the consumer who is going to pay the extra charges. Therefore I would much rather have seen the Bill in its original form.
    Mr. R. S. Hudson: I do not know whether it would be for the convenience of the House if I move my Amendment formally at this stage, because the Whole thing could then be discussed in one instead of leaving it to two discussions.
    The Chairman: That may he done if the Clause is read a Second time.
    Mr. R. S. Hudson: I beg to move, as an Amendment to the proposed Clause, in line 3, to leave out from "activities," to the end of Clause, and to add.
    "such respective sums as may be agreed or, in default of agreement, determined by arbitration under this Act, as fair compensation for the net losses likely to be suffered by those local authorities respectively by way of overhead expenses or establishment charges in consequence of the passing of this Act."
    The right hon. Gentleman in introducing this new Clause said that it had been received with considerable interest by local authorities. I think he is a master of under-statement. I should have said it was received with considerable indignation by a large number of local authorities. We have two objections to the Clause as it stands. In the first place, the amount is, in our view, inadequate. The right hon. Gentleman described it as being rough justice. He went on to say that he thought the full figure of the loss by severance at the present moment might be somewhere between half a million and one million sterling a year and that that loss was not likely to continue for very long. But he gave no substantial grounds for that and I do not think it necessarily follows.
    The hon. Member for Wimbledon (Mr. Palmer) in a book he wrote a little while ago called "The Future of Electricity Supply" pointed out very cogently the results that would be likely to accrue to local authorities. He pointed out that the borough electrical engineer often performed a number of supplementary functions, and that if that particular official was to be taken away, it did not mean that these other functions did not have to be performed, but only that another official had to be appointed by the local authority to perform them. That seems to me largely to weaken the point made by the Financial Secretary. These functions are not necessarily going to disappear. Oh the contrary, a certain number—not perhaps all—are bound to continue, and to that extent the expenditure by the local authority is going to continue. It may not continue to the extent of £1 million a year, but it is going to continue at a substantial level, and to say that the whole of the expenditure is going to come to an end, or can be absorbed, in five years does not represent the state of affairs as we know them now or as they are likely to develop.

    585
    He talked about the fact that a certain number of local authorities, 74 I think, help the rates from their electricity undertakings, and that 10 help the electricity undertakings from the rates, and he seemed to think it was unnecessary to take into account the potential help to the rates which was going to come to an end. That may sound all right here, where none of us are immediately concerned, but it is not going to be much consolation to the ratepayers in the 74 authorities who have seen their rates reduced to the extent of £300,000 a year. Over 20 years that amounts to a sum of the order of £6 million.
    I merely quote those two figures to show how inadequate the sum of £5 million is. As far as the Income Tax set off is concerned it is quite true that this has only been enjoyed of recent years, but it would have been enjoyed on an ever-expanding scale in years to come, and again this is a very definite loss to the rates. Therefore, it is not surprising that the local authorities are not pleased with the situation. I am bound to say that I heard with the greatest surprise the right hon. Gentleman say that the Government had been very closely in touch with the Association of Municipal Corporations. My information is very different. The right hon. Gentleman said, in answer to an inquiry by myself and my hon. Friend the Member for Cheltenham (Mr. Lipson), that it was only the figure of £500,000 to £1 million a year that the association set before them. But there has been, so far as we can gather, no discussion at all.
    Mr. Shinwell: Nonsense. Where does the right hon. Gentleman get his information from?
    Mr. Hudson: The right hon. Gentleman with his normal courtesy, says, "nonsense"
    Mr. Shinwell: It is nonsense. I say it is nonsense.
    Hon. Members: Get up and say it.
    Mr. Gallacher: Shut up.
    Mr. Hudson: Perhaps the Committee, since the right hon. Gentleman makes this statement, will bear with me while I read a letter from the secretary of the Association of Municipal Corporations. I am
    586
    not usually in the habit of making statements without documentary proof.
    He says:
    "I would like to give some further information on the subject of the £5 million now to be included for further compensation to local authorities. You will remember that the Minister made a statement in Standing Committee on 17th April. This was made without any prior consultation, with my association."
    On 17th April the right hon. Gentleman made his statement without any prior consultations with the Association of Municipal Corporations.
    "We were given no opportunity of expressing our views as to the suitability of the amount proposed to be included in the Bill."
    This is what the right hon. Gentleman calls full discussion and consultation.
    "An appropriate Government amendment now stands on the Order Paper in the name of Mr. Shinwell. In the interval my Association have had no opportunity of expressing their views on the adequacy of this sum to the Minister."
    This is what the right hon. Gentleman calls full discussion and consultation.
    Mr. McKinlay: Will the right hon. Gentleman say if the letter he quotes was sent to him in his capacity as a member of this House, and was a similar letter sent to other members drawing attention to the Minister's conduct?
    11.15 p.m.
    Mr. R. S. Hudson: I am merely responsible for this letter which was sent to my hon. Friend the Member for Wavertree (Mr. Raikes) in his capacity as a member of the Association of Municipal Corporations.
    "No views have been presented by my Association because, although they have asked for an opportunity to discuss the £5 million and the method by which it is ascertained, this request has not been granted."
    Nothing could be more categorical than that and nothing could destroy more the statement of the right hon. Gentleman that he was in close touch with the Association of Municipal Corporation and I venture to say it backs up my statement which he challenges that no effective discussions have taken place. It is clear that, in fact, the Association have neither had any discussion as to the adequacy of the amount nor as to the method of its distribution.

    587
    Now I come to the other objection we have to this Clause and that is to its form. The form of the Clause, it will be realised, is
    "The said sum shall be divided among such of the said local authorities as satisfy the prescribed conditions, and the amounts to be paid to the individual authority shall be determined in such manner and in accordance with such principles as may be prescribed."
    The right hon. Gentleman earlier today had occasion to reprove us, saying that a little knowledge was a dangerous thing. It is a little unfortunate he chooses to do that today, for how little knowledge he had when speaking in Committee. I will now read to the right hon. Gentleman what he said in Committee on 17th April. The Committee will remember that the right hon. Gentleman, the Financial Secretary, explained that it was impossible to provide any other wording than this because they had failed to find a formula satisfactory for the distribution of this money. What does the Minister say on 17th April? Does he remember? He says:
    "I do not anticipate any difficulty about finding the Board … on the question of severance … I have had to consider, before the Bill becomes an Act of Parliament, the nature of the organisation to be set up. We have to use as much of the existing organisation, administrative and technical, as if possible when the change is effected."
    He went on to refer to the question of the £5 million:
    "As to its distribution, basis of payment, etc., these are matters which will have to be considered in consultation with the local authorities. I do not anticipate any difficulty about that."—[OFFICIAL REPORT, Standing Committee E, 17th April 1947, c. 647–649.]
    In other words, in April he said that he would have no difficulty, that he did not anticipate any difficulty, in providing a formula; and yet, two months later, he comes to the House and asks us to pass a Clause which, in effect, confesses that he has not been able to find a formula; that he has not been able to reach agreement with the local authorities, and that the whole thing is to be left in the air.
    Mr. Shinwell: Just wait and see.
    Mr. Hudson: Just wait and see, says the right hon. Gentleman. I am going to wait and see. What I suggest is that this shows a gross incompetence on his
    588
    part. We have put forward an alternative. We believe that if we are to deprive the local authorities of these resources, the proper way is to compensate them; and if the only way to secure justice is to compensate them one by one. then that is the procedure which should be followed, even though it may involve some delay. As I said when we were discussing compensation for shareholders. I am certain that if we put the choice to the local authorities whether they preferred the Clause as it stands—not knowing what share they were going to get of what everyone admits is an inadequate sum, namely, £5 million—or whether they would prefer to wait a short time in order to receive eventually a sum based on an accurate assessment of the losses they are going to sustain, there can be no question which any sensible local authorities would choose. Every time they would choose our Amendment rather than the Clause as it now stands.
    Mr. Blyton: From the information I have, the Association of Municipal Corporations would have been quite satisfied had they received £10 million for seven years. But never at any time have they argued that they should have any compensation for the loss of capital assets. It was known by the Association of Municipal Corporations that £15 million was the figure to be asked for; but eventually it was got down to £10 million, and therefore the difference between the Association of Municipal Corporations and the Government is not a question of compensation for capital assets, but the question of a sum of money for what they term the severance because of the loss of their undertakings.
    I want to disagree entirely with the hon. Member for North Wembley (Mr. Hobson), who has now left the House. The Bill provides that the local authority can, out of its surplus, take I½ per cent. of its profit so long as its reserve is one-twentieth of its capital expenditure. It is no use winking at the fact that there are local authorities—and Socialist local authorities—who have taken from their surplus, most particularly in the distressed areas of the North-East, where the rates are very high. Therefore, no charge can be levelled against those of us who have had to face difficult obligations in relation to finance in trying to keep the rates down, by saying we have no regard for

    589
    the electricity consumers of our areas. In my constituency they have as cheap electricity as there is in any part of this country for lighting, heating and power, and they have been able last year to contribute to their rates 8½d. in the pound. That is no mean figure when one considers that the area has a rate of nearly 20s. in the pound.
    It is all right to talk of wealthy areas where the rate is about 11S. in the pound, but it is quite a different matter when the rate is nearly 20s. This town has been able to help its rates, but the biggest help has been the Income Tax set-off. It was a terrific fight against the Treasury, a fight which finished in the House of Lords. In Sunderland last year over £16,000 was contributed to the rates from Income Tax set-off alone. While local authorities are not complaining of the loss of their selected stations, they are concerned about the next financial year when they will lose this income which would help their rates. Therefore, in supporting the new Clause, I shall do so purely because, with the £5 million, which is a considerable advance on what was to be given during the Second Reading of this Bill, and which was asked for in the Committee stage, we shall be largely helped. We are getting £5 million and, with the promise of the revision of the block grant next year, there will be an easing of the financial burden which we face in our areas. I shall be satisfied to go into the Division Lobby tonight to support the new Clause, knowing that what we have lost in respect of the Income Tax set-off will be more than equalled by the block grant next year.
    Mr. Carmichael: I would like to say a word about local authorities meeting certain charges, and I would refer to Glasgow Corporation, which has one of the largest electricity undertakings in the country. At no time was any of the revenue directed towards the reducing of the rates. They ploughed the money back into the concern and likewise aided the consumers of electricity in that area; and I think the Financial Secretary made a fair statement on the position in regard to certain authorities that when they are taken over a loss will result. In the case of pensions, in Glasgow alone the sum is in the region of £4,000. The total figure for Glasgow will be in the region of £112,000 per annum. It is quite true that
    590
    for certain of these charges it will be a reduced sum in succeeding years, but £112,000 is, I think, a formidable figure. I want to make that, clear because the statement has been made tonight that Glasgow was looking for a sum of something like £12 million.
    At no time to my knowledge did Glasgow make any representations of any kind. Glasgow Corporation was of opinion from the very beginning that if the Government decided to take their electricity undertaking under a nationalisation scheme, it was going to serve the community in Glasgow as well as it did under the local authority. They went further and held the view that the undertaking would in the long run be more beneficial under the Government than under the local authority because it would spread the financial responsibility over a greater number of heads. I have no idea how the £5 million has been arrived at. I have no knowledge of the consultations.
    I cannot agree that- the figure is good or bad. Apparently, some of my hon. Friends are satisfied that they could give a better figure but they give no reason. Therefore, I am satisfied that the figure was not blindly got out. For something like two years, in common with other Members of this House, I have watched the activities of the Government, and I have no reason to believe that their conduct, up to now, has been such that I have to disbelieve any statement they make.
    It should be understood that my opposition, if I have any, is not with the desire to gain any political capital, but I would like to know what methods have been adopted up to now to get a proper understanding of the requirements of local authorities? What have been the approaches to local authorities in Scotland? Are they involved in this general scheme? I ask that because I do not think we can get any clarity while some hon. Members think in terms of assessing the rating problem. I agree that if you can get 8½d. off the rates as a result of the revenue from an electricity undertaking, that that is constantly in mind when compensation is discussed. It is quite impossible to arrive at a reasonable figure with all the undertakings because of their varying claims and I feel—I do not make a parochial request of this—that the representations of the Scottish authorities cannot succeed because their rate problems

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    are entirely different. It should be possible to get some understanding quickly as to the sum involved without involving them with all the municipalities up and down the country.
    11.30 p.m.
    I understand that this £5 million will be allocated after a formula has been worked out and issued in regulations. Surely at this hour it would be possible to have some kind of discussion with the municipalities prior to the making of regulations. From the point of view of administration, I think that you might consider at least discussing the financial position with the Scottish local authorities by themselves. I do not press this unduly because I do not know the machinery involved, but from past experience in other matters it has been quite useful. I am supporting the Clause and I would go further and say I am satisfied—and I hope the right hon. and gallant Member for the Scottish Universities (Lieut.-Colonel Elliot) will note— that I have the backing of the Socialist municipality of Glasgow. It is necessary to say that because there is a great danger that the right hon. and gallant Gentleman is leaving a wrong impression with the House about the position of Glasgow.
    The Deputy-Chairman: Mr. Raikes.
    Mr. McKinlay: On a point of Order. The right hon. Member who moved this Amendment drew the attention of the Committee to the fact that the hon. Member for Wavertree (Mr. Raikes) was an officer of the Municipal Corporations Association. If the hon. Gentleman is an officer of the association, is he going to declare his interest?
    The Deputy-Chairman: The hon. Member must wait and hear what the hon. Member says.
    Mr. McKinlay: Further to that point of Order. This is not the first stage of the proceedings of this Bill. I am informed that no declaration has been made in Committee.
    The Deputy-Chairman: I am concerned only with the proceedings now and not what happened before.
    Dr. Morgan: With due respect, Mr. Beaumont, am I to understand from you that on a point of great
    592
    importance involving a Member's interest in a Bill, you are ruling definitely on proceedings tonight, not having regard to the fact that it is alleged that in previous discussions on the Bill the hon. Member has spoken and not disclosed his interest?
    The Deputy-Chairman: It is quite impossible for me to judge that matter because I am not aware of what occurred before. We must wait and see.
    Mr. Gallacher: If I committed anything which was suspected of being an offence, what a howl there would be from the other side. If there is any question at all that the hon. Member has acted in a way that is not in keeping with the recognised rules and procedure of the House, if there is any doubt, he should not be allowed to speak further on the Bill until that doubt has been effectively settled.
    The Deputy-Chairman: So far, the hon. Member for Wavertree (Mr. Raikes) has not said anything at all and, therefore, he is completely in Order. I now call upon the hon. Member for Wavertree to speak.
    Mr. James Hudson: With great respect, I was a member of the Committee and heard the speeches, being quite a regular attendant, and, as you say, Mr. Beaumont, we have not had information upon the point. I want to assure you that there has been no revealing up to this stage of the point which has only come out in the House tonight regarding the hon. Member's special connection with the organisation that we are now discussing. I put it to you that the hon. Gentleman has discussed this matter in Committee without any knowledge being given of his special interest.
    The Deputy-Chairman: The one thing that seems to be very well known to hon. Members is the interest of the hon. Member for Wavertree. I have no knowledge of this, but even if he does not declare his interest, he is still entitled to speak.
    Mr. Raikes: After all this discussion, I am afraid I shall have to dispel the anxieties and fears of certain hon. Members opposite. It is a duty that any Member discussing any Measure in which he has any financial connection should disclose that financial

    593
    interest. I have no financial interest whatever. My connection with this particular organisation simply amounts to this, that I was made a vice-president of the association of Municipal Corporations, Liverpool branch, as a local M.P. Indeed, until I received the letter referred to I did not even realise that I was a vice-president.
    Hon. Members: Withdraw.
    Mr. McKinlay: I want to say quite frankly that I have no ill-will against my hon. Friend. I was simply quoting a statement made with regard to his being an officer of the association.
    An Hon. Member: That is not a financial interest.
    The Deputy-Chairman: May I clarify the position by quoting Erskine May on this point:
    "Members interested may propose a motion or amendment. Although a member interested is disqualified from voting he is not restrained by any existing rule of the House from proposing a motion or amendment."
    Lieut.-Colonel Elliot: Further to that point of Order. Is it not clear that Erskine May had in consideration financial matters, that the interest in question should be a financial interest, that it is a financial interest which an hon. Member is required to disclose and that it is in connection with a financial interest that he would be disqualified from voting?
    The Deputy-Chairman: The right hon. and gallant Gentleman's interpretation is correct. I think we can now go on with the Debate.
    Mr. Dodds-Parker: Is it in Order for any hon. Member opposite who votes for any of these Amendments or for the Bill to accept a job afterwards under the authority?
    The Deputy-Chairman: In answer to that point of Order, I am concerned only with what is happening at present. I cannot deal with nor anticipate what may happen in the future.
    Mr. Raikes: Perhaps at this stage I may get on. I will only say in passing that I feel no pain or ill-feeling on the point raised by hon. Members opposite. They had a right to know what my position was and I have explained it. I wish
    594
    to say a word about this Amendment especially as my right hon. Friend quite properly referred to the letter which had been written to me by the Association of Municipal Corporations. The date of that letter is 23rd June of this year. I understood from the speech of the Financial Secretary that there had been close touch between the Government and the Association of Municipal Corporations. I do not think I have misrepresented him. If I have he will of course pull me up. But what is the actual position? I do not think he was suggesting that there had been discussions with the association as to the figure of £5 million. That figure, of course, did not exist at the time of the Second Reading, but was introduced suddenly in the Committee stage on 17th April. At that time certain objections were taken to it as being a figure which seemed to be based on nothing at all. I do not think we have been given very much more of an explanation tonight than we were given on 17th April.
    What has happened between 17th April and this Debate tonight? As I understand it, neither the Secretary of the association nor any of its officials have met any Minister for the purpose of discussing the question of the £5 million. I believe it is correct that certain officers of that association went to the Ministry and that at the Ministry they were unable for some reason or other to meet the Minister. That is rather unfortunate, in view of the importance of that association in the work which lies before the Government. Indeed, the Financial Secretary has emphasised the importance of their co-operation in certain parts of that work. It seems rather curious that no Minister took the opportunity of seeing them and discussing their case directly with them between the time that this proposal was put forward and tonight. I am not denying that the Minister, no doubt as a result of these gentlemen coming to his Ministry, received a report of their objections to this £5 million. I think, therefore, that my right hon. Friend was perfectly justified in making the point that the question of the £5 million had never been discussed beforehand with the association, and that it had never been discussed between the Minister and the association since the figure was produced. My right hon. Friend would not deny, any more than I propose for a moment to deny, that no doubt the Minister, as a result of the

    595
    discussions which his officials had during the visit, had a note of what the objections were. I think it is possible to clear up a point which might conceivably have led to some completely unnecessary heat.
    There is considerable doubt whether the £5 million is a suitable figure. It seems to me to be a figure which has not been really worked out completely in any form. That is why we on this side, in the Amendment we have put down, have suggested that there should be no precise figure laid down at this stage, but that after consultation between the Government and the local authorities efforts should be made to pay what appeared on full consideration to be a reasonable sum to the different local authorities taking them as far as we can—we may not be able to do it entirely—one by one. The £5 million may not be a sufficiently ample figure, and if we are tied down to it, and it proves to be wrong, everyone will get less than their due.
    It was the view of the Minister that local authorities should not wish to make a profit out of this matter. It is equally important that they should not make any loss. The Financial Secretary said quite frankly that he did not know how long it would take to effect reorganisation, and quite obviously neither he nor the Minister really know how long it will be for that time to come: that is a very strong argument in favour of not being pinned down to £5 million as a maximum figure at the present time.
    11.45 p.m.
    In regard to rates it seems a little hard that you are treating all the municipalities on exactly the same basis. Take a municipality, which, over a period of time, has not only provided an electricity supply but has also contributed to the rates, perhaps a sum of two million pounds—as with Liverpool. It is to be treated exactly the same as another municipality which has had to take money from the rates in order to help its municipal electricity supply. That is an example of penalising the efficient by means of the inefficient. [HON. MEMBERS: "No".] I am taking an extreme case. There are many municipalities who do use the profits from the electricity supply in order to relieve the rates. I very strongly support the Amendment, for I think we should wait
    596
    until there is a fairer allocation. I also believe that there' is a great deal to be said for extending the application of the principle of a tribunal to deal with a matter authoritatively, because the Financial Secretary admitted my last point and made it quite plain that he had been looking for the help of the Association of Municipal Corporations. He has not succeeded up to the present time in getting their support or co-operation either in regard to distribution or to the amount of money involved. It seems to me it might not be an impossible task to have a proper independent tribunal to decide as between local authority and local authority.
    Mr. Shinwell: There has been some excitement in general in this Debate, but it could have been avoided if, instead of the right hon. Member for Southport (Mr. R. S. Hudson), the hon. Member for Wavertree (Mr. Raikes) had spoken earlier because I agree with almost everything he said. I understand the right hon. Member for Southport complained about my absense. Having delivered himself of that homily and having indulged in gross discourtesy, he disclaims being discourteous. Having accused me of being guilty of gross incompetence, hon. Members opposite pretend to be polite when they indulge in statements of that character. Presumably when they describe me as grossly incompetent they intend it to be a form of politeness—as a Tory term of endearment. If having been described as grossly incompetent, and having received their usual castigation, I venture to respond even temperately, they are annoyed. The fact is that they like to give, but they do not like to take. The only other thing I want to say about personalities is this. I have been a long time in this House. [An HON. MEMBER: "Too long."] Nevertheless I intend to remain a little longer. After all, I assisted in keeping some of their friends out, which was something of an achievement and was necessary in the interests of good government. Frequently in the course of our Debates hon. Members opposite say what they like about us, sometimes hitting below the belt, and they really must not squeal if some of us can hit straight from the shoulder. What hitting they can indulge in will not worry me. I can take half a dozen of them on before breakfast.

    597
    Let us get down to facts. They are not likely to prove palatable to the right hon. Member for Southport. [Hon. Members: "He is not here."] Perhaps that is why he is absent.
    Lieut.-Commander Gurney Braithwaite: Listen to the Greek chorus.
    Mr. Shinwell: The hon. and gallant Member for Holderness speaks about a Greek chorus. Better to be associated with a Greek chorus than a beauty chorus. The right hon. Member for Southport said there had been no consultation with the Association of Municipal Corporations, and in order to fortify himself in that remarkable declaration, for which there was no justification, he referred to a letter which had ben sent by the association.
    Mr. R. S. Hudson: If the right hon. Gentleman is speaking about me he had better quote me correctly. I said I was surprised to hear the claim of the Financial Secretary, and then I proceeded to quote what the letter said.
    Mr. Shinwell: The fact is that the right hon. Gentleman does not know what he is going to say when he gets up and does not know what he has said when he sits down. He read a letter which he said had been sent to the hon. Member for Wavertree (Mr. Raikes), who has explained the position with honesty and fairness, on the basis of the facts.
    Mr. Raikes: If the right hon. Gentleman will permit me, he is endeavouring to suggest that my explanation and that of my right hon. Friend were at variance. I bore out what my right hon. Friend said —that there had not been that close touch and personal contact which the Financial Secretary claimed.
    Mr. Shinwell: The statement of the ten. Member does him credit. He is doing all he can to rally to the assistance of the right hon. Gentleman. I beg to assure him that he is wasting his time. The right hon. Gentleman is just "a painted ship upon a painted ocean." The right hon. Gentleman read from this letter sent by the Association of Municipal Corporations to the hon. Member. It was sent to a large number of other people. I have received one from one of my hon. Friends. No doubt, if I went over to my office I should find several copies there. What they said
    598
    was that the sum of £5 million, which it was proposed to divide among the local authorities in respect of the severance of their electricity undertakings, was not arrived at by agreement with the association, and that it was regarded as quite inadequate. That is true, but it does not bear out the allegation that there was no discussion and no consultation.
    The fact is that before there was any suggestion of a payment of £5 million in compensation to the local authorities, the Association of Municipal Corporations met the Prime Minister, at their own request. I was present when the deputation was received, and some of my colleagues were there also. The representatives of the association stated their case, and they referred, among other things, to this question of compensation—not the general question of compensation in lieu of losses sustained on rates and the like, but compensation based on severance, and offset in Income Tax, and on other matters. Thereafter, it was decided that we should pay some compensation in respect of severance.
    12 m.
    We considered what could be done and, I must confess, we found there was great difficulty in arriving at a basis upon which a sum of compensation could be returned. There is no question about that. There was difficulty and there was bound to be difficulty. It is a very complex question but it is true also that during the Committee stage, when I was asked about this formula for the purpose of making payment to the local authorities out of the global figure of £5 million, I was in possession of certain information which resulted from certain discussions that my officials had had not only with the Association of Municipal Corporations but with representatives of the Incorporated Municipal Electrical Association.
    As a result, I was in a position of being able to say, based on that information, that we could arrive at a formula which would have regard to the number of units used by municipal electricity undertakings in 1946, and I thought it might be possible to arrive at a satisfactory formula. But, thereafter, the associations concerned made further representations. They had found that there were difficulties associated with this formula and, as a result, we sought to find other formulae and we are still engaged, I say frankly,

    599
    in a search for a formula which will prove adequate for the purpose. We propose to issue regulations to provide that these discussions can be continued, until we can find a basis upon which these payments to local authorities can be made. The names of the persons whom my officials met were Mr. Daniels, the Secretary of the Association of Municipal Corporations and Mr. Lithgow, the Financial adviser. These gentlemen came and discussed the matter with my officials. It may be said that the Minister did not, see them. The fact is that I saw, on the' general question including compensation for severance, the Incorporated Municipal Association twice and the representatives of the Association of Municipal Corporations on one occasion. Therefore, it cannot be alleged that we ignored these representative bodies. On the contrary, we sought every means to elicit from them the information upon which we could come to a satisfactory conclusion, and, in view of what we did, the suggestion that we are guilty of gross incompetence—all I can say is that this is a characteristic of the right hon. Gentleman.
    What are the facts about this matter? The Financial Secretary—I think it is within the recollection of hon. Members who were present on both sides of the House—made a speech which was, in lucidity of expression, one of the best that has been heard. There can be no doubt about his meaning and he dealt with that matter point by point until no one could say there was ambiguity about the position—and I have only to dot the i's and cross the t's. Take the real issue of this question—the compensation to local authorities. If local authorities— and the number was mentioned by my right hon. Friend—were making a contribution to rates out of revenue of electricity undertakings, to that extent they were depriving the electricity consumer of their legitimate rights. It amounted to this; it was a queston of rates versus rights, and therefore, local authorities who were making such a contribution to rate relief were not justified in doing so in view of the claims of the electricity con sumers. In any event, it is certain that, if we were to pay compensation in lieu of rates to any local authorities there would be terrific resentment on the part of other local authorities who had played the game all the way through.
    600
    The question is whether the amount of compensation suggested is adequate. I would tell the Committee what the position is as regards the claims of the representatives of the municipal organisation. They have said to us, and I ask members opposite to note it, "£5 million is not enough. Give us £10 million. Give us £10 million and we will call it a deal No questions asked. We will find some method of distributing the amount. There may be difficulties in respect of individual determination of payments, whether this or that authority receives this amount or that, but just leave it to us and it can be arranged." You simply cannot go on indulging in pranks of that kind and, indeed, my hon. Friend the Member for North Wembley (Mr. Hobson) said we have been generous in giving £5 million
    Let it not be forgotten that, in asking the Central Authority to provide compensation, we are asking them to increase the burdens on electricity consumers. We must be very careful not to impose burdens on the new Authority. I agree at once that it is very difficult to effect an equitable distribution of £5 million and I can understand why the Opposition has put forward this Amendment. What they are saying in effect is this: would it not be better to have some form of tribunal so that the local authorities, who have claims to present, can go and say, "Here is our claim; we want you to consider it," and, once a claim has been dealt with, receive the amount to which they think they are entitled. There are 370 local authorities and they would all present claims. Some would be very involved and some would be very extravagant and, no doubt, the 370 local authorities would all employ members of the legal profession to state their case, and that would involve the local authorities in expenditure which would have to come out of rates.
    It is our view—maybe it is a simple view, but nevertheless it is our view—that it is far better to have a global figure and, in consultation with the local authorities, find some formula which will be more or less satisfactory and see if we cannot reach some happy conclusion in that way. It does not seem to me that we need go beyond that. My hon. Friend the Member for Bridgeton (Mr. Carmichael) asked whether there had been any consultation with local authorities over the

    601
    Border. The Incorporated Municipal Electrical Association has branches in Scotland. The president of the association. Mr. Pickles, whose presidential address, delivered yesterday, which I have in my possession, indicates they are thorough-going supporters of the nationalisation of electricity supply, is the manager of the Dumfries County Council Electricity undertaking, which is one of the best undertakings in the country. Therefore I would ask my hon. Friends behind me—I know there are differences of opinion—to believe me when I say that we have made every effort to satisfy the local authorities, that on the whole this is a reasonable conclusion at which we have arrived, and that, while some local authorities may be dissatisfied, generally speaking we are endeavouring to meet their claims.
    As for the Amendment, I ask the Committee to reject it on the grounds that it is obstructive, that it would prolong the agony, and is, at any rate, not an indication that Members opposite are anxious to support the local authorities. It 1s rank hypocrisy for them to say that they support the local authorities when some of those which they claim to support happen to be Socialist authorities. What is more, I say that it is a clear indication, as has been clear to us all along the line, that Members opposite will do anything open to them in order to defeat this proposition of nationalisation.
    Mr. Lipson: I am afraid that the local authorities will get very little satisfaction when they read the speech, of the Minister. I think many of them will be hurt, and I must say, justifiably hurt, at the way in which he has referred to them. To suggest that a responsible body like the Association of Municipal Corporations would go to him and want to do a deal of about ten million pounds, with no questions asked, 01 something of that kind, is, if I may say so, unworthy of a Minister of the Crown On reflection, I hope that fee Minister will realise that this is not the correct method of approach to local authorities, or the way to speak of a body of men who are rendering very great service to the people of this country. The Financial Secretary himself said of the proposals in the new Clause, that they represent rough justice. That is not a very extravagant claim to make: and, personally, I would emphasise
    602
    the rough side and say that the justice side, as I see it, is very little in evidence.
    The local authorities say that they are getting a very raw deal under this Bill They are being treated worse than the companies are being treated, because the companies at least are being bought out at the market value of their securities Therefore, the local authorities say that the ratepayers whom they represent will have their burdens increased as a result of the passing of this Measure, and that it is only right that they should be compensated for the loss. This loss falls under three heads: the loss under severance, which the new Clause recognises; the loss of the set-off against Income Tax; and the loss with regard to the assistance which has been given to the rates from the electricity undertakings. I submit that there is nothing wrong in a local authority receiving aid for the rates from the profits of an electricity undertaking.
    12.15 a.m.
    It is not fair to say that this has been done at the expense of the consumers unless facts can be given to prove it; unless you can prove that the consumers in those areas where the rates have benefited have been overcharged for their electricity. In point of fact, those undertakings which have been able to subsidise the rates are those whose undertakings have been most efficiently run. That is the reason why they have been able to do it. In my constituency, in spite of the assistance which the rate gets from the three sources I have indicated, the rates are 20s. in the pound and they will be much more than that as a result of this Bill. Where there is a difference of opinion between representatives of a local authority and the Government I cannot see how the Minister can, in justice, deny that this whole thing should be subject to arbitration. The local authorities are equally convinced that the sum is inadequate just as the right hon. Gentleman thinks it is, adequate.
    Mr. Shinwell: The local authorities have never once asked for this to be put to arbitration.
    Mr. Lipson: The Amendment suggests that arbitration should be used so far as the distribution of the amount is concerned. But there is a difference of opinion between the Association of

    603
    Municipal Corporations and the Government as to the amount to be paid. I submit that the only way in which it could be settled satisfactorily would be to use the method of arbitration. Any way, whether the Association have asked for it or not, the Minister is not sure that the live million pounds is a reasonable amount. He is not so sure that he is ready to submit it to arbitration. If he is confident, he should be prepared to do so. Of course, it might be that the arbitrator would say "This is too much." That has been suggested by an hon. Member, but it has to be remembered that if one goes to arbitration one has to accept the result. Arbitration is the proper way of dealing with this, and if the maximum is five millions I am sure there will be a very grave feeling of dissatisfaction among the local authorities of this country.
    If there had been no local authority undertakings it would have cost the Government much more than the sum which the local authorities are getting. That is a factor in this argument. I would appeal to the Minister, even at this stage, to give further consideration to the representations of the local authorities and try to arrive at an amount, not to be fixed tonight, but one which can be given to this House later on for further discussion. I do put it to the Minister that this is the only just way of dealing with this matter
    Mr. David Eccles: The substance of the Minister's argument appeared, to be that a proper assessment would take so much time and trouble that it was better to have a shot in the dark and that that is good enough. I do not think he will get anywhere near a right decision. Is there any difference between the consumers and the ratepayers? Are they not mostly the same people?
    If it is a case of rates versus rights the argument does not hold water. It may be a good thing to say on the platform, but let us examine what the Financial Secretary has said. He put it forward that 74 authorities helped the rates to the tune of £309,000. But that is not the whole story. That is the proportion of the profits which they chose to transfer to the relief of the rates. Of course, they made very much more profit than that and, no doubt, with the far greater sums which they retained in their undertakings,
    604
    they paid off some of that debt and increased the value of the assets which belonged to the municipalities concerned. It must be true that different municipalities pursued different financial policies in regard to their reserve allocations and the amount of help they gave to the rates and, therefore, it is not an easy matter to decide what is really the loss to any given municipality under some general formula.
    Now as I understood the Minister, he said it was wrong for them to have made profits out of the sale of electricity. He said that was depriving the consumers of their rights. He said that the price of electricity should have been so adjusted downwards that the accounts balanced. That was the substance of his argument. What will now happen under the compensation as proposed? In the cases where rates have been aided by profits from the electricity undertaking, those rates will have to go up. When they go up the consumers of electricity who were also ratepayers—and I claim that a great many of them were—will be in a worse position unless the price of electricity is reduced after nationalisation takes place. Have we any assurance that in these cases the price of electricity is going to be reduced? If we have no assurance on that point, then it is quite obvious that these particular people will suffer a loss as a result of the undertaking being nationalised. Then we have this extraordinary contradiction; that one Minister of the Crown says it is wrong to make a profit out of selling electricity, in which case no compensation ought to be paid at any time, and the other Minister of the Crown says, "We are going to compensate these particular people for the loss of rates when we readjust the block grants."
    Mr. Glenvil Hall: Obviously the hon. Gentleman has got my argument wrong. If I may say so, as far as I know, local authorities have never pressed for compensation because of the effect on rates. They have almost universally realised the position. Although it may be, as he says, that rates may go up because of this loss—they never have put in a serious claim that they should be compensated because one particular authority aided the rates with the profits made from an electricity undertaking.
    Mr. R. S. Hudson: What I said was that the proposition was put up at a meeting of the Municipal Corporations. That proposition was defeated on purely political grounds by the majority who were Socialists.
    Mr. Glenvil Hall: If I may put it this way, what I was trying to do was to show that losses do arise through the fact that some local authorities would now no longer be able to aid the rates. But I wanted to do justice to the local authorities.
    Mr. Eccles: I think the hon. Member for Houghton-le-Spring (Mr. Blyton) pointed out that certain local authorities suffered very much. I consider it to be the duty of hon. Members to look into this matter and, if we think that local authorities or anybody else have a claim which they might not have put forward, it is up to us to put it forward. I cannot see how the Government can get out of the position that in certain circumstances some consumer-ratepayers will be worse off under nationalisation, and I cannot see why that should not be a matter for compensation.
    The Government's case is that they cannot find a formula. They say, "Let us have this five million pounds sum and see how it goes." I agree with the right hon. Member for Southport that it would be better to do justice even if it takes a little more time. Can the Government assure us that the local authorities would reject our proposal? I do not think they can say that. I am sure if they put it to the representatives of the local authorities that the figures of loss will be properly worked out, they would prefer it. Perhaps after all it would turn out that the sum would be less. It would depend upon the terms of reference to the Tribunal. I am not prepared to say that five or ten million pounds is right. We will not get justice under the Clause as it stands, but under the Amendment, if accepted, we shall get justice.
    Mr. Boyd-Carpenter: The question it seems to me is not whether agreement has been or could have been come to between the local authorities and the Government; surely the question, and the only material question, is whether proper compensation is being paid and being paid in the right way. As I understand it, all hon. Members with the possible exception of
    606
    the hon. Member for West Fife (Mr. Gallacher) concede that compensation should be paid when property is taken over. That necessarily involves an assessment of compensation by reference to some outside factor, and I think that our proposal does meet that. I think I am right in saying that this is the first occasion on which property has been taken over under a nationalisation Bill without the compensation to be paid being assessed by reference to some outside authority or to some outside—
    Mr. Hobson: The principle of which the hon. Gentleman complains has been applied in other cases; for example, the East and West Ham tramways were taken over by hon. Members opposite on precisely the same basis as is contemplated for the electricity undertakings in this Bill.
    Mr. Boyd-Carpenter: I do not think for one moment that the hon. Member is right in saying that that principle was followed in the case of the East and West Ham trams of simply voting a lump sum. The question is: is this a proper compensation proposal to pass the House of Commons or not? My first and principal objection to it is that there is no specific proposal included in the Bill. I think the Committee is entitled to be told why there is no full and detailed proposition put up in the Bill. Let me remind the Committee of what the right hon. Gentleman the Minister of Fuel and Power himself said upstairs in Committee on 17th of April when he announced the proposal. I quote from col. 646 of the OFFICIAL REPORT. The Minister then stated:
    "What I am saying is that if we should decide compensation we have to devise a formula and get a basis on which it is to be paid and that whatever is decided can easily be expressed in the Bill. There is no difficulty about that."—[OFFICIAL REPORT, Standing Committee E, 17th April, 1947, c. 646.]
    12.30 a.m.
    That was over two months ago and yet no such formulae, no such proposals, have yet been put forward into this Bill. I think we are entitled to be told why. Was the reason gross incompetence? Or were there some other reasons why it has been found inconvenient to include it. The point surely is—and it is the only material point—whether this is a method of compensation which can be allowed to

    607
    go from this committee. We are given a figure which the Financial Secretary himself said might be over generous. I should be entirely opposed to giving compensation which was over generous. We are not told in any way whatever how it is to be allocated and sub-allocated among the 370 local authorities concerned Surely we are entitled to be told that. What is proposed is apparently simply this—
    Mr. Gallacher: On a point of Order. Is it in Order that some points which have been put by a Front bench Member and which were answered by the Minister should be repeated? The Minister explained the formula which they had agreed upon and which had then, because of this or that, to be discarded. He explained it arising out of the argument of the right hon. Gentleman. This is complete repetition.
    Mr. Boyd-Carpenter: If the hon. Member for West Fife has had the good fortune to be let into the secret of the Government's formula—
    Mr. House: On a point of Order. Can we have this point of Order met, please.
    The Chairman: Tedious repetition is not permissible. But I do not think we have quite reached that point yet.
    Mr. Gallacher: But the Minister answered the point.
    The Chairman: That may be, and I hope hon. Members will forebear to use repetitive arguments.
    Mr. Boyd-Carpenter: If the hon. Member for West Fife has been let into the secret of the Government's formula, and also let into the secret of why there has not been included a provision which the Minister said more than two months ago could easily be included, he is in a somewhat monopolistic position. If that explanation is available, it should have been divulged, not in secret to the hon. Member for West Fife, but to this Committee. If there is to be any suggestion of repetition may I say this: perfectly reasonable questions were put to the Minister by several hon. and right hon. Gentlemen who spoke before me. The right hon.
    608
    Gentleman did not answer any of them. I submit that Members of the Committee are entitled to demand of the Government that these highly pertinent and highly material questions shall be answered. Some of us are not prepared simply to vote £5 million to be handed over to the Minister to be distributed as the Minister thinks fit, scattered like chicken feed to a flock of chickens by the Minister. For many reasons not only do we think that inexpedient, but we are not prepared to entrust such a vital function to a Minister who might well think that such compensation should only be paid to—if I may adopt his own phraseology—intelligent municipalities of a non-Tory character.
    Mr. Wilkins: I only want to take up one point which has been put before the Committee from the other side, and which I think is a complete fallacy. I have been associated with probably one of the largest if not the largest municipal electricity undertakings in the country. I think my hon. Friend the Member for Stockport (Sir A. Gridley) was also a member on one occasion. I believe it is true to say that the Act governing the electricity industry lays down there must be 5 per cent. of the capital value of the undertaking in the reserve fund before any authority may distribute money to the rates. Therefore, it is clear that very few authorities in this country have built up sufficient reserves to enable them to make contributions towards the relief of the rates.
    I hope the Minister will not listen to the argument that compensation for these authorities should help their rates funds, because the more progressive authorities have taken the view that it was their business to help consumers who had helped to build up the undertaking. We have done so by making available to the consumers of Bristol electrical labour-saving appliances at very low charges for hire. Consequently, if the Minister does listen to the plea now being made that he should compensate for rate-aids, he will fall foul of those authorities who have distributed their surpluses for the benefit of the consumers who built up the undertakings by their support. I hope the Minister will stand firm on this point. I am as anxious as any Member to see that local authorities are justly treated in this matter. I think they have a claim on the basis of their Income-tax set-offs and for stock

    609
    management expenses towards which the Government may well pay, but on rate-aids they have no claim at all.
    Lieut.-Colonel Elliot: The Debate, with its two contributions from the Minister and the arguments brought forward by the right hon. Gentleman on the justice of the claim, seems to recall the eminent judge, whose views will no doubt be familiar to-the Solicitor-General—the judge who reflected on one occasion, "many murderers have escaped, but, on the other hand, a number of innocent men have been hanged, so on balance justice has been done." That is the sort of average which the Government are attempting to strike, for the Minister seems to fail to understand with whom his quarrel is. His quarrel is with the local authorities.
    Mr. Gallacher: There is not a quarrel with anybody.
    Lieut.-Colonel Elliot: The Minister's quarrel is with the Association of Municipal Corporations and with other bodies of local authorities. The points in regard to the Association of Municipal Corporations have been brought out very clearly and it is necessary to point out again what was said:
    "The Minister's statement was made with out any prior consultation with my Association. We were given no opportunity of expressing our views of the suitability of the amounts proposed to be included in the Bill. An appropriate Government Amendment now stands on the Order Paper in the name of Mr. Shinwell. In the interval my Association have had no opportunity of expressing their views as to the adequacy of this sum to the Minister."
    That is not a statement of any Member on this side of the House; that is a statement of the Association of Municipal Corporations. It is a statement which the Minister has to deal with—but this is not the only statement the Minister has to deal with. The Association of Urban District Councils has also expressed its views. I do not happen to be an officer of this Association and I have no interest of any kind or description in it. They wrote:
    You may like to know the views of the urban district councils, 112 in number, who own electricity undertakings, and I am sending herewith copies of two letters I wrote the Prime Minister."
    They enclose letters which say that on 14th March
    610
    "We desire respectfully to protest against these terms inasmuch as, apart from the loss which the urban district councils will incur through being deprived of their right under the Electricity Supply Act, 1926, to transfer profits in relief of current rates … we will also suffer serious loss by the severance of the electricity undertakings from the functions which they carry on."
    In letters on 14th March and 6th June, they protest again, saying that
    "the Association protest at what they regard as the inadequacy of the global sum for compensation of £5 million, which on 17th April the Minister of Fuel and Power announced as the compensation proposed to be made to meet substantially the claims of the local authorities. They would earnestly ask that the amount of the global sum should not be determined without consultation with the local authorities."
    They say on the 23rd June:
    "I am informed by the Secretary of the Association of Municipal Corporations that the Ministry of Fuel and Power have not acceded to the suggestions which that Association and the Urban Districts Councils' Association both made that the question of the global sum should be discussed with the Associations."
    Mr. Glenvil Hall: A tribunal or arbitration was never suggested.
    Lieut.-Colonel Elliot: The Minister can always be trusted when the chance comes of putting his foot into it, to put it in up to the thigh. He now repeats the statement he has made once or twice—I did not intend to be harsh—that they have never suggested that there should be a tribunal and that it was never suggested there should be arbitration. How then does he explain the Amendment drafted by them to Clause 14, page 20, line 48:
    "Provided that if any local authorities are dissatisfied with the determination of the Minister under this Section, they shall be entitled to have the question determined by an arbitration tribunal"?
    Mr. Shinwell: That relates to compensation on severance.
    Lieut.-Colonel Elliot: The fact of the matter is that the local authorities, as is well known, have been in consultation with each other and have repeatedly stated their dissatisfaction with the size of the sum. They desire to have further discussion with the Minister on the size of the sum. Quite clearly, the distribution of the sum is also a matter on which they are dissatisfied. Here the Minister 'himself, I think, cannot be held guiltless, because he held out the hope in Com-

    611
    mittee that he would be able to put something down on the Paper which would deal with the question of distribution. It is well known that on Friday morning the Clause the Minister had been brooding over did appear on the Paper. It stated that the Minister would distribute the sum in accordance with any ideas the Minister might have. He could have put that on the Paper without two months' delay and avoided the complicated and cumbersome procedure of Report stage and the recommittal of a new Clause at the end. It derives directly from the inability of the Minister to arrive at a clear and simple method of distribution which he held out hopes that he would be able to do. If the Minister has taken so long and has not yet found a suitable formula, what guarantee is there that he will find a suitable formula at all? All the arguments tonight are against that. There are still 370 local authorities, and it will take a long time, he says, under a tribunal to inquire into their claims.
    The Minister's proposals will not be a saving of time. All they mean is that compensation, admittedly inadequate, is to be distributed along lines the Minister is unable to disclose. I do not think that is a reputable record. I do not think it is an adequate way to deal with compensation. The proposal we make for a tribunal is one of obvious and simple justice, which could be easily written into the Bill now and would work satisfactorily in the future. More than that, it would tend to resolve the quarrel between the municipal corporations, the urban districts, the great local authorities of this country, and the Government, which is the real difficulty with which we are faced and with which the Minister and the Financial Secretary have struggled so long tonight, and wholly in vain.
    Question put, "That the words proposed to be left out stand part of the proposed Clause."
    The Committee divided: Ayes, 182; Noes, 69.

    Division No. 287

    AYES

    12.46 a.m

    Adams, Richard (Balham)

    Edelman, M.

    Longden, F

    Adams, W. T. (Hammersmith, South)

    Evans, John (Ogmore)

    Mack, J. D.

    Allen, A. C. (Bosworth)

    Evans, S. N. (Wednesbury)

    Mackay, R. W. G (Hull, N.W)

    Anderson, A. (Motherwell)

    Fairhurst, F.

    McKinlay, A. S.

    Attewell, H C

    Field, Captain W J.

    McLeavy, F

    Baird, J.

    Fletcher, E G M (Islington, E.)

    Mallalieu, J P W.

    Bechervaise, A E

    For man, J C

    Manning. Mrs L (Epping)

    Bing, G H C

    Freeman, Maj J. (Watford)

    Mathers, G

    Blackburn. A. R

    Gaitskell, H. T. N.

    Mellish, R J

    Blenkinsop, A.

    Gallacher, W

    Mikardo, Ian

    Blyton, W R.

    Ganley, Mrs C S

    MillingK, Wing-Comdr E. R

    Bowden, Flg.-Offr. H W

    Gibbins, J.

    Mitchison, G. R

    Bowles, F G. (Nuneaton)

    Gibson, C W.

    Monslow, W

    Braddock, Mrs. E. M (L'pl, Exch'ge)

    Gilzean, A.

    Morris, P (Swansea, W.)

    Bramall, E. A

    Glanville, J. E. (Consett)

    Murray, J D

    Brook, D. (Halifax)

    Greenwood, A. W J (Heywood)

    Nally, W

    Brown, T J. (Ince)

    Grey, C. F

    Neal, H (Claycross)

    Buchanan, G

    Griffiths, D. (Rother Valley)

    Nichol, Mrs. M. E. (Bradford, N.)

    Burke, W. A

    Griffiths, W D. (Moss Side)

    Nicholls, H. R. (Stratford)

    Butler, H. W (Hackney, S.)

    Haire. John E (Wycombe)

    Noel-Baker. Capt F E. (Brentford)

    Carmichael, James

    Hale, Leslie

    Noel-Baker, Rt. Hon. P. J. (Derby)

    Castle, Mrs B. A

    Hall, W. G

    Oliver, G. H

    Champion, A J

    Hamilton, Lieut.-Col R

    Orbach, M.

    Chelwynd, G R

    Hannan, W. (Maryhill)

    Paling, Will T (Dewsbury)

    Cocks, F. S.

    Herbison, Miss M.

    Palmer, A. M. F.

    Collindridge, F

    Hobson, C. R.

    Pargiter, G A

    Collins, V J

    Holman, P

    Paton, J (Norwich)

    Caiman, Miss G. M

    House, G

    Pearson, A

    Comyns, Dr. L.

    Hoy, J.

    Peart, Thomas F.

    Corbet, Mrs. F. K. (Camb'well, N.W.)

    Hubbard, T

    Plans-Mills, J F F

    Corlett. Dr. J

    Hutchinson, H, L. (Rusholme)

    Popplewell, E

    Crawley, A.

    Hynd, H (Hackney, C.)

    Porter, G. (Leeds)

    Crossman, R H

    Janner, B.

    Price, M. Philips

    Daggar, G

    Jeger, G (Winchester)

    Pritt, D N

    Dairies, P

    Jeger, Dr S. W. (St. Pancras, S.E.)

    Proctor, W. T

    Davies, Edward (Burslem)

    Jones, D. T. (Hartlepools)

    Pryde, D J

    Davies, Harold (Leek)

    Jones, Elwyn (Plaistow)

    Pursey Cmdr H

    Davies. Hayden (St. Pancras, S W)

    Jones, P. Asterley (Hitchin)

    Randall, H E.

    Deer, G.

    Keenan, W

    Ranger, J

    de Freitas, Geoffrey

    Kendall, W. D

    Reid T (Swindon)

    Delargy, H. J.

    King, E. M.

    Robens, A.

    Diamond, J

    Lang, G

    Roberts, Goronwy (Caernarvonshire)

    Driberg, T. E. N.

    Leonard, W

    Pobertson, J. J (Berwick)

    Dugdale, J. (W. Bromwich)

    Lewis, A. W. J. (Upton)

    Rogers, G

    Dumpleton, C. W

    Logan, D. G

    Ross, William (Kilmarnock)

    Royle, C.

    Stubbs, A.E.

    West, D. G.

    Scollan, T.

    Sylvester, G. O.

    Whiteley, Rt. Hon. W.

    Segal, Dr. S.

    Symonds, A. L.

    Wigg, Col. G. E.

    Shackleton, E. A.

    Taylor, H. B. (Mansfield)

    Wilcock, Group-Capt. C. A. B.

    Sharp, Granville

    Taylor, R. J. (Morpeth)

    Wilkins, W. A.

    Shawcross, C. N. (Widnes)

    Taylor Dr. S. (Barnet)

    Willey, F. T. (Sunderland)

    Shinwell, Rt. Hon. E.

    Thomas, I. O. (Wrekin)

    Williams, J. (Kelvingrove)

    Skeffington, A. M.

    Thomas, George (Cardiff)

    Williams, W. R. (Heston)

    Skeffington-Lodge, T. C.

    Thorneycroft, Harry (Clayton)

    Willis, E.

    Skinnard, F. W.

    Tiffany, S.

    Wills, Mrs. E. A.

    Smith, C. (Colchester)

    Tolley, L.

    Woodburn, A.

    Snow, Capt. J. W.

    Ungoed-Thomas, L.

    Yates, V. F.

    Sorensen, R. W.

    Walkden, E.

    Younger, Hon. Kenneth

    Soskice, Maj. Sir F.

    Wallace, H. W. (Walthamstow, E.)

    Stewart, Michael (Fulham E.)

    Watkins, T. E.

    TELLERS FOR THE AYES

    Stokes R. R.

    Watson, W. M.

    Mr. Joseph Henderson and

    Stross, Dr. B.

    Weitzman, D.

    Mr. Simmons.

    NOES

    Astor, Hon. M.

    Fraser, H. C P.'(Stone)'

    Molson, A. H. E.

    Baldwin, A E.

    Gage, C.

    Neven-Spence, Sir B

    Birch, Nigel

    Galbraith, Cmdr. T D

    Nield, B. (Chester)

    Boles, Lt.-Col. D. C (Wells)

    Gridley, Sir A.

    Noble, Comdr A H. P.

    Bossom, A. C.

    Haughion, S. G.

    Osborne, C.

    Bower, N

    Henderson, John (Cathcart)

    Peto, Brig. C. H. M.

    Boyd-Carpenter, J. A.

    Hinchingbrooke, Viscount

    Prescott, Stanley

    Bracken, Rt. Hon. Brendan

    Hollis, M. C

    Prior-Palmer, Brig. O

    Bromley-Davenport, Lt.-Col. W

    Hudson, Rt. Hon. R. S. (Southport)

    Raikes, H. V.

    Channon, H.

    Hurd, A

    Roberts, Maj P. G (Ecclesall)

    Clarke, Col R. S.

    Hutchison, Col. J. R. (Glasgow, C.)

    Robinson, Wing-Comdr. Roland

    Clifton-Brown, Lt.-Col. G

    Jarvis, Sir J.

    Ropner, Col L.

    Conant, Maj. R. J. E

    Lambert, Hon G

    Sanderson, Sir F

    Crosthwaite-Eyre, Col O. E

    Lancaster, Col. C G

    Scott, Lord W.

    Cuthbert, W. N.

    Langford-Holt, J.

    Spearman, A C M.

    Digby, S. W.

    Legge-Bourke, Maj. E. A. H.

    Spence, H. R.

    Dodds-Parker, A. D.

    Lipson, D. L.

    Stanley, Rt Hon. O

    Dower, E. G. (Caithness)

    Lucas-Tooth Sir H.

    Sutcliffe, H.

    Drayson, G. B.

    Mackeson, Brig. H. R.

    Vane, W M. F.

    Drewe, C

    Macpherson, N. (Dumfries)

    Williams, Gerald (Tonbridge)

    Eccles, D. M.

    Maitland, Comdr. J W.

    York, C

    Eden, Rt. Hon. A.

    Marshall, D. (Bodmin)

    Elliot, Rt. Hon. Walter,

    Marshall, S. H. (Sutton)

    TELLERS FOR THE NOES

    Foster, J. G. (Northwich)

    Mellor, Sir J

    Mr. Studholme and

    Lieut.-Colonel Thorp

    Question put, and agreed to.

    Clause added to the Bill.

    NEW CLAUSE.—(Bodies to whom Part 11 of Act applies.)
    (1) This Part of this Act applies to—

    (a) the bodies specified in the Schedule (Authorised undertakers to whom Part II of Act applies) to this Act (hereafter in this Act referred to as "authorised undertakers") being the bodies who fall within the class described in the next following subsection;

    (b) every company (hereafter in this Act referred to as a "power station company") who are not authorised undertakers but whose business wholly or mainly consists in the construction, owning or operating of a generating station or stations for the supply of electricity to authorised undertakers; and

    (c) every company (hereafter in this Act referred to as an "electricity holding company") who—

    (i) are not authorised undertakers, or a power station company,

    (ii) had at the date of the last audited balance sheet of the electricity holding company before the first day of January, nineteen hundred and forty-six, one or more subsidiary companies, being authorized undertakers or power station companies, and

    (iii) at the said date held securities of, or rights in respect of moneys owed by,
    614
    the said subsidiary companies, the value of which, as shown in that balance sheet, amounted to not less than three-quarters of the total amount of all the assets of the holding company as so shown.

    (2) The class of bodies referred to in paragraph (a) of the last foregoing Subsection are—

    (i) bodies who supply electricity under the authority of any enactment in any area of supply in Great Britain; and

    (ii) bodies who supply electricity, under the authority of an enactment, to the bodies mentioned in paragraph (i) hereof or to the Central Electricity Board;

    Provided that the said class does not include—

    (a) any body, other than a local authority, whose business as suppliers of electricity consists wholly or mainly in the supply of electricity for consumption by themselves or by a company of whom they are a subsidiary company;

    (b) any local authority who supply electricity for the purposes of a transport undertaking carried on by them and do not supply electricity for other purposes to any substantial extent; or

    (c) any body, other than a local authority who carry on a transport undertaking and who do not supply electricity under any provisional or special order made under the Electricity (Supply) Acts, 1882 to 1936.

    (3) Where a special order made under section twenty-six of the Electricity (Supply) Act, 1919, comes into force between the passing of this Act and the vesting date and provides for the transfer of the undertaking or any part of the undertaking of any authorized undertakers to another body, the order may—

    (a) if the body from whom the undertaking or part thereof is transferred no longer falls within the class described in Subsection (2) of this Section, provide that this Part of this Act shall not apply to that body;

    (b) if, by reason of the transfer, the body to whom the undertaking or part thereof is transferred falls within the said class, provide that this Part of this Act shall apply to that body;

    and this Act shall have effect in accordance with any such direction.
    (4) Any such special order may, for the purpose of giving effect to a transfer of the undertaking or part thereof, revoke or amend any enactment relating to the powers of the body from whom the undertaking or part thereof Is transferred.
    (5) For the purposes of paragraph (c) of Sub section (1) of this Section, where the value of any such securities or rights as are therein mentioned is not separately shown in the balance sheet therein mentioned, by reason that they are grouped with other assets of the company and the balance sheet shows the value of the group as a whole, the value placed on the said securities or rights in the books of the company and used in arriving at the value of the group of assets as so shown shall have effect as if it had been shown separately in the balance sheet."—[Mr. Gaitskell.]
    Brought up, and read the First time.
    Mr. Gaitskell: I beg to move, "That the Clause be read a Second time."
    In the Bill as originally drafted the bodies whose assets were to be transferred were authorised undertakers, power station companies and certain holding companies, and authorised undertakers were defined as the Central Electricity Board, any joint electricity authority and any other body authorised by any enactment to supply electricity in Great Britain. This last definition was found to be too wide. It includes certain local authorities and other bodies which supply electricity for transport and tramways only, and the attempts we made to try and narrow the definition were not entirely successful. We finally decided that the best way of dealing with the problem was to put a list of authorised undertakings into a Schedule and describe in the new Clause, in general terms, the classes of bodies to be taken over in the Schedule. These changes were foreshadowed by my right hon Friend at an
    616
    early stage in the proceedings in Committee and subsequently I myself gave the scheme in outline in the discussions on Clause 59. The new Clause takes the place of Subsections (2) and (3) of Clause 13, and it proceeds to list the three groups: first, all those in the Schedule; secondly, power station companies; and thirdly, holding companies.
    Apart from the differences I have mentioned, the only other change is in the definition of holding companies. This has been altered again in accordance with undertakings we gave so as to allow out of vesting certain classes of holding companies which otherwise would have been in. As the hon. Member for Stockport (Sir A. Gridley) will recall, he asked during the Second Reading Debate whether we were to take over holding companies with no controlling interest in any subsidiary companies? I indicated that we should not do so. There is one such company which will be excludes under the new arrangements as I shall describe in a moment. Now we are pressed to go further than that and we have agreed to do so and adopted the suggestion made by the Opposition that we should take over holding companies which have 75 per cent. of their assets in the form of holdings of subsidiary companies in the electricity industry. And that of course, does narrow the field slightly. I will explain the change by example. If a company had assets of £I million and £500,000 in subsidiary companies, say, £300,000 in other electricity undertakings which it did not control and the remaining £200,000 in cash and outside investments, such a company will now be excluded whereas previously it would be included.
    I do not need to say very much more about the new Clause. Subsection (2) indicates the classes of bodies included in the Schedule and specifically excluded. Subsections (3) and (4) provide for alterations which may be made by special orders before the vesting date. Finally, we had the assistance of the Opposition who put down two Amendments of a technical kind at an earlier stage which we certainly would have wished to accept in principle. We discussed the matter with the Opposition as to whether a slightly different Amendmem would meet these points and we are grateful to

    617
    the Opposition for drawing attention to these weaknesses in our original draft.
    Mr. R. S. Hudson: I beg to move, as an Amendment to the proposed Clause, in line 20, at the end, to insert:
    "Provided that it any electricity holding company shall before the vesting date serve on the Minister a notice in writing requiring that in respect of the securities or rights' mentioned in paragraph (c) of this subsection the company desires to be treated in like manner as other holders of the like securities or rights, then for the purposes of this Act such company shall be treated accordingly and shall be deemed not to be an electricity holding company."
    Perhaps it would be for the convenience of the Committee if I also deal with the following Amendment on the Paper to insert:
    "Provided that any of the bodies specified in Part II (Composite companies) of the said Schedule may, at any time before the vesting date, serve on the Minister notice requiring that this Act shall not apply to such body and thereupon this Act shall not apply to such body."
    These Amendments are intended to provide that different persons may opt to be out of the Clause. The result of our first Amendment would be to enable holding companies to opt right out of the Bill altogether. I do not want to go into it at great length except to say that if any such holding company did opt out, it would not prevent the new Central Electricity Authority from having all the electricity assets that the holding company possess. The electricity assets would automatically, of course, vest in the Board, and it would really enable the holding company for other purposes, either at home or with important assets from an invisible export point of view abroad, to continue in business. We do not think that on the whole this could do any harm to the general routine set up in the Bill.
    1.o a.m.
    The second Amendment refers to a comparatively small number of special cases of composite bodies, undertakings which are probably only 12 in number. Under the provisions of the new Clauses, arrangements are contemplated whereby these composite companies can sever their electricity undertakings, which have to be handed over to the Board, from the rest
    618
    of their activities, in particular, and most important, gas. We understand, from speeches made by Members of the Government, that, sooner or later, they propose to bring in a Bill to nationalise the gas industry. On that assumption, as the electricity portions of these companies are not of any great importance or moment, it would seem better that, instead of going through all the difficulties which will be involved in severing the electricity and gas parts of the undertakings for a comparatively short time before gas is nationalised, they should carry on as they are and that one bite should then be made at the cherry and the whole lot taken over later on, when the gas industry is nationalised. That represents, very briefly, the substance of our two Amendments, and I hope that the Government, even if they cannot accept the exact wording of the Amendments as we have them on the Order Paper, will consider accepting the principle of them and possibly making the necessary alterations during later stages of the Bill.
    Sir A. Gridley: I was hoping that someone would rise from the Front Bench opposite to give us an indication whether the Government are going to accept these Amendments, or not. If they are not going to accept them, I am afraid I must put my case in support of them. May I disclose a particular interest which I have in this matter, because I happen to be a director of a small combined electric lighting and gas undertaking? It may be one of a dozen undertakings which own gas or water undertakings or both. It would be a most absurd arrangement if we had to part with the electricity undertakings and were left for a comparatively short time to carry on with the gas. In fact I do not know how it would be possible to do so, because the majority of the management and staff are engaged in looking after the electricity supply undertaking, which is by far the larger of the two; there would be no one, if the electricity undertaking were taken over, with its staff, to run the gas undertaking properly. There are other cases where these composite companies have ordinary shares, preference shares and debenture shares, and if part of the securities is taken over, great complication would arise with regard to the rights of the debenture holders and so on.

    619
    These are reasons additional to those which were put by my right hon. Friend, and there is the third point which I would raise. We have had a very long discussion about compensating local authorities. There would be a similar question arising about these composite organisations and there is no suggestion there should be compensation for such companies as these. I should have thought that from the commonsense point of view the Government's nationalisation would be in no way affected by these 12 undertakings being left as they are as a matter of convenience. It will not make the initiation of the nationalisation of the industry much different. Leave these for 12 months or so until the gas nationalisation Bill is put on the Statute Book. Of course, if the Government say they have not any intention of nationalising gas, the position is different but we have heard no alteration to the statements made that that industry is to be nationalised. The Government will have gas, electricity, coal, and oil in one great monopoly undertaking, and I do feel the Minister should say if there is any real reason why the undertakings to which I refer should be disturbed. They will fall into the Government's lap in due course and if the Government leave them alone, there will be no unnecessary dislocation.
    Mr. Gaitskell: I am sorry, but we cannot agree to this Amendment. I would like to meet the Opposition on this but there are pretty strong grounds why we cannot go farther than we have already gone. I think the Opposition will agree that we have gone a long way to meet them. These holding companies— now reduced to 12—are true holding companies managing a series of electricity undertakings, as an essential and integral part of the electricity supply industry. As hon. Members have said, these companies have played a worthy part in the past in developing electrical supply. We shall be taking over few non-electrical assets, under the new definition we have made of holding companies. There is something in what the hon. Member for Stockport (Sir A. Gridley) has said about it being a matter of common sense, but one of these undertakings has a capital of about £2,500,000 and practically all of it is electrical. Secondly, if a company feels it cannot carry on with gas alone and
    620
    without electricity it is free to opt to be taken over as a whole. I cannot go farther than saying that I will think over the points the hon. Gentleman has made on the second Amendment, but I am afraid I cannot give a definite undertaking now.
    Colonel Crosthwaite-Eyre: I did not think the Parliamentary Secretary's statement was very satisfactory. He has in effect said that we on this side ask them to' take over holding companies. I think that was a slip of the tongue but I would make it clear that we on this side have never asked him to take over these companies. We asked for certain companies to be excluded when we discussed it in Committee. I cannot see that these holding companies should not be treated just as any other shareholder is treated. Why should they not be paid out? The Parliamentary Secretary said he wants managerial experience. That seems to be a very poor reason. Shareholders of holding companies may have other ideas of what should be done. He says he is going to perpetuate injustice in order to secure this particular advantage he wants for himself, or the Government want for themselves under this Bill. That does not seem to be a logical or reasonable argument. We should expect, and have every right to expect, holding companies which, in fact, are exactly equivalent to shareholders, to be treated in the same way and for this differentiation to be made does not seem to us to be reasonable.
    I would go further. Holding companies under previous Measures, such as Cable and Wireless, have been exempt and are starting in spheres of activity which are highly useful and it seems that holding companies in the electrical field could do the same. If they are to be taken over and abolished, according to the Parliamentary Secretary's own words, so that managerial experience may be available to the electricity board, it was not reasonable. If they want managerial experience, let them compete for it and obtain it from the open market. They could do that on terms as favourable as anyone else but to abolish the existing enterprises so as to force on the market this sort of type of experience seems to be quite unjustified. It seems to me that there is no real reason for taking them over. They are merely being taken over to provide, on the cheap, something that the Minister desires in a

    621
    technical way. That seems to be inequitable and unjust. I hope that before we leave this someone from the Front Bench will produce a more positive reason than that of trying to get something on the cheap as they are now doing.
    Mr. Palmer: I want to deal with the point about holding companies. There is another good reason why they should be taken over because very often they have a very vast practical technical organisation which has been, for a great number of years, integrated into the whole structure. I have Edmund-son's particularly in mind. Edmundson's have a large technical staff and a central testing department and fine facilities of a higher order than is available to the electrical supply industry. Not to take over holding companies and their organisations intact would seriously weaken the intention of this Bill. Therefore I, for the best practical reason, support the Government.
    Sir A. Gridley: The argument of the hon. Member for Wimbledon (Mr. Palmer) is entirely fallacious. Under our Amendment the composite companies would remain unsevered until they could be taken over as a whole and no staff severance would arise.
    Amendment to the proposed Clause negatived.
    Clause added to the Bill.

    NEW CLAUSE.—(Right of pre-emption for local authorities in respect of land-vested in an Electricity Board.)
    (1) Where any land of a local authority vests by virtue of this Act in an Electricity Board, the local authority shall, for a period of ten years from the date of the vesting of the land, have the right of pre-emption conferred by the subsequent provisions of this section.
    (2) If the Electricity Board in whom the land vests by virtue of this Act, or any other Electricity Board to whom it is subsequently transferred, desire within the said period of ten years, to dispose to any person other than an Electricity Board, whether absolutely or for a term of years, of any of that land as being land not required by the Board for the discharge of their functions under this Act, they shall before disposing of it give to the local authority at least three months' notice, stating whether they desire to dispose of it absolutely and, if not, stating the terms of years for which they desire to dispose of it.
    (3) Where the local authority receive a notice under subsection (2) of this section and notify the Board, before the expiration of the period
    622
    of three months from the date of the Board's notice, that they desire to acquire the land either absolutely or for the term of years specified in the Board's notice, as the case may be, they shall have the right and be under an obligation to acquire that land on such terms as may be agreed between the Board and the authority or, in default of agreement, as may be determined by arbitration to be fair and reasonable having regard to all the circumstances of the case.
    (4) The right of pre-emption conferred upon the local authority by this section shall be deemed to be an estate contract within the meaning of section ten of the Land Charges Act, 1925, and that Act and the Land Registration Act, 1925, shall have effect accordingly. —[The Solicitor-General.]
    Brought up, and read the First time.
    1.15 a.m.
    The Solicitor-General: I beg to move, "That the Clause be read a Second time."
    The new Clause gives the local authority the right within a period of ten years to acquire back land which has been vested in an electricity board in the event of the electricity board desiring to dispose of it. The scheme of the Clause is this: if the board desires to dispose of that land, they must give notice to the local authority from which it was acquired, giving the terms on which they want to dispose of it, whether freehold or for a period of years; and the local authority, having received that notice, are given a right, if they wish to do so to acquire that land on the terms. The scheme is quite simple, and it gives what we feel to be a measure of justice to the local authorities to enable them, when land has been acquired from them and it turns out that it is really not needed, to get it back on terms. It gives them a preferential right so to do.
    Mr. R. S. Hudson: I beg to move, as an Amendment to the proposed Clause, in line I, after "authority," insert:
    "or of any company which is not dissolved by this Act."
    The Amendment seeks to extend a similar right to composite companies. In so far as they retain their gas undertakings, they will be forbidden by law to manufacture gas except on land scheduled. If the electricity company do not want the surplus land, it will be much cheaper for them to buy it back instead of having to go to the expense of getting more land scheduled.
    The Solicitor-General: We feel that we can accept the principle of this Amendment, but we feel that we will have to recast it, because the words "composite companies" are used in another context. We do accept the principle of the Amendment, and that acceptance would, of course, affect a number of other Amendments on the Order Paper.
    Mr. R. S. Hudson: I am much obliged to the Solicitor-General. In view of his assurance, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Clause added to the Bill.

    NEW CLAUSE.—(Acquisition of non-statutory undertakings.)
    (1) This section applies to any person, not being a body to whom Part II of this Act applies, who at the passing of this Act is engaged in supplying electricity to the general public and who, at any time after the nineteenth day of November, nineteen hundred and forty-five, has incurred or incurs, in respect of works approved by the Minister for the purposes of this section (whether before or after the execution of the works) expenditure properly chargeable to capital account; and in this section any such person is referred to as "the undertakers," and his business, so far as it consists of the supply of electricity to the general public, is referred to as "the electricity undertaking."
    (2) The undertakers may, at any time before the expiration of the period of twelve months beginning with the date of the passing of this Act, serve on the Central Authority a notice requiring that the electricity undertaking shall be transferred under this section, and thereupon the following provisions of this section shall have effect.
    (3) On such date, not being later than six months after the service of the notice, as may be agreed between the undertakers and the Central Authority or, in default of agreement, determined by the Minister (which date is hereafter in this section referred to as "the date of transfer "), all property of the undertakers which was, immediately before the date of transfer, wholly or mainly used for the purposes of the electricity undertaking shall, by virtue of this Act, vest in the Area Board whose area comprised the whole or the main part of the area of supply of the undertakers, and shall vest free of any mortgage or other incumbrance.
    (4) For the purpose of transferring to the said Area Board agreements to which the undertakers were a party immediately before the date of transfer and which they entered into for the purposes of the electricity undertaking, so far as those agreements remain to be performed after the date of transfer, every such agreement, whether in writing or not, and whether or not of such a nature that rights, liabilities and obligations thereunder could be assigned by the undertakers shall
    624
    unless its terms or subject matter make it impossible, have effect, as from the date of transfer, subject to the like modifications (with the substitution of references to the date of transfer for references to the vesting date) as agreements of bodies to whom Part II applies which are transferred to the Area Board under that Part.
    (5) The provisions of Part II of this Act relating to the disclaimer of agreements and leases shall apply to any agreements or leases which are transferred to the said Area Board under this section in like manner as they apply to agrements and leases of bodies to whom that Part applies, subject to the modification that for references to the vesting date there shall be substituted references to the date of transfer.
    (6) Subject to the provisions of this section, there shall be paid by the Central Authority to the undertakers, by way of compensation for the transfer of the electricity undertaking, such amount as the undertaking might have been expected to realise if—

    (a) it had been sold as a going concern on the date of transfer in the open market market by a willing seller to a willing buyer;

    (b) the effect of the sale had been to transfer to the buyer the property, rights liabilities and obligations which are transferred or granted to the Area Board by or under this section, except any property or rights, which are transferred or granted on terms agreed or determined in accordance with regulations made under this section: and

    (c) this Act had not been passed.

    (7) Any question arising under this section as to—

    (a) whether a particular person is a per son to whom this section applies;

    (b) what property of the undertakers vests in the Area Board under subsection (3) of this section;

    (c) what agreements of the undertakers are to have effect in accordance with sub section (4) of this section;

    (d) what compensation is to paid under subsection (6) of this section;

    shall, in default of agreement between the undertakers and the Central Authority, be determined by arbitration under this Act, and the provisions of Part II of this Act relating to the arbitration tribunal shall apply for the purpose of determining questions under this section and any questions which, under regulations made under this section, are to be determined by arbitration under this Act, as they apply for the purpose of determining questions under the provisions of Part II of this Act or any regulations made thereunder.
    (8) Subsections (2) and () of section fourteen of this Act shall apply to the undertakers in like manner as they apply to a local authority subject to the modifications that for references to property held or used by the local authority in their capacity as authorized undertakers there shall be substituted references to property held or used by the undertakers for the purposes of the electricity undertaking and for references to the Minister of Health there shall be substituted references to the Minister.
    (9) Regulations may make provision, in a case where property vested in an Area Board under this section was, immediately before the date of transfer, subject to a mortgage or other incumbrance, for the payment to the mortgagee or incumbrancer of the compensation or any part of the compensation payable in respect of that property, or may make other provision for the protection of mortgagees and incumbrancers of any such property.
    (10) Where at the date of transfer any legal proceedings or any application to any authority under any enactment are pending by or against the undertakers in connection with any property, rights, liabilities or obligations which are vested in or transferred to an Area Board under this section, the Board, if the circumstances so require, may be added as a party to the proceedings or application or may be substituted for the undertakers as a party to the proceedings or application.
    (11) Nothing in this section shall operate to transfer any cash or investments of the undertakers to an Area Board, and nothing in this section shall affect—

    (a) any right, liability or obligation with respect to the borrowing of money by the undertakers or to the raising of money by the undertakers by the issue of securities;

    (b) any right, liability or obligation (if the undertakers are a company) under any agreement for the rendering by any person of services to the undertakers, as a director (other than a managing director or a director whose functions are substantially those of an employee);

    (c) any right to, or liability to pay, any debt which became due before, or was in respect of a consideration wholly executed before, the date of transfer; or

    (d) any right to, or liability to pay, any damages which accrued before the date of transfer.

    (12) Regulations may require any person who is or may be a person to whom this section applies to produce such books of account, records and documents, to supply copies of and extracts from such books, records and documents, and to furnish such other information as may reasonably be required—

    (a) by the Minister for the purpose of ascertaining whether or not this section applies to that person, or for other purposes arising out of the provisions of this section; or

    (b) by any Electricity Board for the purpose of facilitating the taking over of the electricity undertaking of that person by them on the date of transfer;

    and to provide facilities for the examination of any such books, records and documents, and the taking of copies thereof and extracts there from and facilities for the verification of other information furnished under the regulations; and such regulations may make provision as to the manner, time and place in or on which any requirement under the regulations is to be complied with and shall provide for the payment to any such person of expenses reasonably incurred by him in complying with any requirements made by or under the regulations.
    (13) For the purposes of this section, a person, shall, when supplying electricity to any other person, be deemed to be supplying electricity to the general public unless the electricity is supplied for the purposes of a trade or business and the relationship between the person giving the supply and the person supplied is that of a holding company and a subsidiary company, or vice versa, or either of the said persons is in some other way, able to exercise a substantial measure of control over the carrying on of the trade or business of the other person, and any question as to whether a supply of electricity to any person is a supply to the general public shall, in default of agreement between the undertakers and the Central Authority, be determined by arbitration under this Act.
    (14) The foregoing provisions of this section shall, in their application to any undertakers whose area of supply is wholly or mainly comprised in the North of Scotland District, have effect with the substitution for references to the Minister of references to the Secretary of State, and for references to the Central Authority or to an Area Board of references to the North of Scotland Board.—[Mr. Gaitskell.]
    Brought up, and read the First time.
    Mr. Gaitskell: I beg to move, "That the Clause be read a Second time."
    In the Bill as originally drafted, no mention was made of these undertakings. We did not propose that they should be touched in any way by the changes that have been made. We took that view because we did not consider that, in the main, nationalisation affected their position, and we envisaged that they would continue much as in the past, and would compete, as far as they were able to do so, with, the area boards in the same way as they had competed in the past with municipal undertakings or companies. But in the course of our discussions in Committee—this is not a matter on which we have ever felt very strongly—and as a result of further consideration, we have come to the conclusion that, in certain conditions, it is desirable that non-statutory undertakings should be given the option of being taken over under the Bill. The conditions which we propose in this new Clause to lay down are, firstly, that they must be bona fide electricity supply undertakings and, secondly—more important perhaps—that they must have incurred capital expenditure since 19th November, 1935, on works approved by the Minister. The purpose of this second condition is really to ensure that we are getting into the position of statutory undertakings that are of some importance, and that their capital de-

    627
    velopment is of significance. It would be damaging to consumers if we were to discourage such capital development. My right hon. Friend the Minister explained —I think to meet a point put by hon. Members opposite in Committee—that he proposed to move an Amendment of this kind. I do not think there is anything else I need say in commenting on the Clause, which I hope goes some considerable way towards meeting the views expressed by the Opposition.
    Mr. Birch: I would like to say one word on this new Clause. I think it can be generally welcomed, and, in particular, the method of compensation laid down in the Clause is to be welcomed, because it does precisely what we have been asking for—arbitration on the basis of a going concern. But I would like to ask the Parliamentary Secretary a question on the first provision that the companies can only come in if they have incurred capital expenditure approved by the Minister after 19th November, 1945. I would like to know in what sort of proportion the companies are likely to be brought in. What is the Minister's policy about this? The Committee will see the Minister has complete power to exclude any or every company under the wording at present. I would like to know before we part with this Clause how the policy is to be administered?
    Colonel Clarke: I would like to support what has been said by my hon. Friend the Member for Flint (Mr. Birch). I feel that, as it stands, this provision is a little bit illogical. At the same time, I congratulate the Minister on having arrived at what I think is a straightforward and equitable solution of the problem in general. If the Minister would consider again the points that we have raised, we would be grateful.
    Mr. Gaitskell: I cannot give a detailed and exact answer on how we shall administer this Clause. It really arises out of suggestions and arguments put forward by Members opposite that capital expenditure was being discouraged on account of the fears of non-statutory undertakings that they would encounter difficulties later on in competition with the area boards. Our approach has been that we must be sure that sort of thing does not happen. Therefore, we have had to take account
    628
    of their position in relation to consumers' demands. I do not think I can really say more than that.
    Mr. Hobson: I think it is to be welcomed that non-statutory undertakings can, if they desire, now be acquired; but I rather deplore that the Minister himself has not seen fit to acquire some of the non-statutory undertakings. I refer, in particular, to the railway generating stations. In the London area alone there are three large generating stations with a total capacity of nearly half-a-million kilowatts. The annoying thing is that the Electricity Commissioners have already contributed towards the cost of installation of turbines and the standardisation of frequencies, and they are in a position to export and import current. I think it ought to be done. I can foresee in the future that there will be considerable departmental strife as between the Transport Board and the Electricity Authority, and it seems to me that these non-statutory undertakings, the railway power stations, which are capable of supplying electricity for both domestic and industrial purposes, should have been absorbed. The new Clause should have been framed in such a way as to give the Minister power to acquire non-statutory as well as statutory undertakings.
    Clause read a Second time, and added to the Bill.

    NEW CLAUSE.—(Composite Companies.)
    (1) This section applies to the companies (in this Act referred to as "composite companies") who are specified in Part II of the Schedule (Authorised undertakers to whom Part II of Act applies) to this Act, being companies who, by virtue of any enactment supply gas, or gas and water, as well a electricity:
    Provided that this section shall not apply to any such company who serve on the Minister, not later than two months after the passing of this Act, a notice stating that they do not wish this section to apply to them, and references in this Act, except in the said Schedule, to composite companies shall not be construed as referring to any company who have served such a notice.
    (2) The provisions of section thirteen of this Act shall, in the case of composite companies, only apply to property held or used by the company wholly or mainly in their capacity as authorised undertakers, and to rights, liabilities and obligations acquired or incurred by the company in the said capacity, and accordingly references in that section to the property, rights, liabilities and obligations of a body to whom Part II of this Act applies,

    629
    or to any agreement to which any such body was a party, or to documents referring to any such body, or to legal proceedings or applications by or against any such body shall be construed as references to property held or used by the company wholly or mainly in their capacity as authorised undertakers, and rights, liabilities and obligations acquired or incurred by the company in the said capacity or, as the case may be, to agreements, documents, legal proceedings or applications of or relating to the company in their capacity as authorised undertakers, and subsection (13) of the said section shall not apply to any composite company.
    (3) Any questions arising under this section as to whether any property is or was held or used by a composite company wholly or mainly in their capacity as authorised undertakers or whether any rights, liabilities or obligations were acquired or incurred by any such company in the said capacity or whether any agreements or documents relate to any such company in the said capacity or whether any agreements or documents relate to any such company in the said capacity shall, in default of agreement, be determined by arbitration under this Act, and the arbitration tribunal shall have regard to whether or not entries relating to any property, rights or liabilities were or ought to have been included in the accounts furnished by the company to the Electricity Commissioners under section nine of the Electric Lighting Act, 1882.
    (4) Subsections (2) and () of section fourteen of this Act shall apply to a composite company in like manner as they apply to a local authority, subject to the modification that for references to the Minister of Health there shall be substituted references to the Minister.
    (5) Regulations may make provision—

    (a) for the apportionment of, and the making of financial adjustments with respect to, any liabilities incurred by a composite company partly in their capacity as authorised undertakers and partly in other capacities, and for any necessary variation of mortagages and incumbrances relating to such liabilities; and

    (b) for the apportionment of cash and investments held by a, composite company partly in their capacity aforesaid and partly in other capacities.

    (6) Where any property of a composite company which vest's by virtue of this Act in an Electricity Board is subject to any mortgage or other incumbrance created for the purpose of securing a debt which does not' so vest in the Board and is not apportioned as between the Board and the company, the property shall vest free of that mortgage or incumbrance.
    (7) The Electricity Board in whom any property, rights, liabilities or obligations of any composite company vest by virtue of this Act shall make available to the company such facilities for the examination of and the making of extracts from or copies of books, accounts and documents relating to the electricity undertaking of the company as the company may reasonably require for the purposes of this Act and for other purposes
    630
    arising out of the carrying on of the company's business, and such services of officers of the, Board as they may reasonably require to enable them to make use of those facilities. —[Mr. Gaitskell.]
    Brought up, and read the First time.
    1.30 a.m.
    Mr. Gaitskell: I beg to move, "That the Clause be read a Second time."
    This is another matter upon which we have never felt very strongly and upon which we have changed our minds. In the Bill as originally drafted, there was no specific provision for the separation of gas, or, for that matter, water, from the electricity part of undertakings. We took the view that perhaps the simplest way was to take them over, as the gas industry would like them to be nationalised in due course; and, for the time being, to have the gas side of the undertaking managed separately, to be passed on in due course to the new organisation set up. But we had to consider the matter in the light of the particular views represented to us by some of the larger composite companies, who pointed out that it would be awkward for the gas undertakings we were to take over, to be separated, from the undertakings by which they were controlled.
    It was really the problem of the gas holding companies which brought us to the conclusion that our original plan would not be entirely unsatisfactory, and accordingly, we devised a method by which only the electricity part of the undertakings would be taken over, unless, of course, the companies themselves opted, as they have a right to do, to be taken over as a whole. That is the purpose of this new Clause. The proposal which the right hon. Gentleman the Member for Southport (Mr. R. S. Hudson) made, that Clause 14 should apply in this case is, I think he will find, taken care of in the actual words of the new Clause.
    Clause read a Second time, and added to the Bill.

    NEW CLAUSE (Compensation to composite companies.)
    (1) Every composite company shall be entitled to be paid by the Central Authority, by way of compensation for the vesting in that Authority or in any other Electricity Board of property and rights of the company, and in lieu of any other compensation in respect of that vesting, an amount calculated as follows:—

    631

    (a) the aggregate value of all the securities of the company shall be ascertained in accordance with subsections (2) to (9) of section seventeen of this Act, subject to the modification that for the references in subsections (6) and (7) to the stockholders' representative there shall be substituted references to the company;

    (b) there shall be ascertained the proportion which the average net revenue earned by the electricity undertaking in respect of the last three complete financial years before the tenth day of January, nineteen hundred and forty-seven, bears to the average net revenue earned in respect of those years by the company's undertaking as a whole;

    (c) the amount of the compensation shall be an amount bearing to the aggregate value of the said securities the same proportion as the said average net revenue of the electricity undertaking bears to the said average net revenue of the company's undertaking as a whole.

    (2) Any question arising under paragraph (b) of the last foregoing subsection shall, in default of agreement between the company and the Minister, be determined by arbitration under this Act.
    (3) The right of a composite company to compensation under this section shall be satisfied by the issue to the company of British Electricity Stock of such amount as in the opinion of the Treasury is at the vesting date of a value equal to the amount calculated under subsection (I) of this section, regard being had (in estimating the value of the stock so issued) to the market value of government securities at the vesting date.
    (4) If, in the case of any composite company, the amount of compensation payable to the company under this section has been determined before the vesting date, the British Electricity Stock to be issued in respect thereof shall be issued on that date, and in any other case the British Electricity Stock shall be issued as soon as the amount of that compensation has been determined.
    (5) Interest on any stock so issued after the vesting date shall begin to accrue as from the vesting date, and the Central Authority shall, on such dates as the Minister may direct, make to the company payments of interest not exceeding the amount which, in the opinion of the Central Authority, will be found to have accrued on the British Electricity Stock ultimately issued in satisfaction of the compensation.
    If the amounts paid to any company by the Central Authority under this subsection are equal to or greater than the amount of interest which is found to have accrued on the said stock for the period beginning with the vesting date and ending immediately before the date of the issue of the stock, the interest so found to have accrued shall be treated as discharged, and if the amount paid as aforesaid is less than the amount found to have accrued as aforesaid, the amount so found to have accrued shall be treated as discharged to the extent of the amount so paid, and the balance shall be added to and treated as part of the interest (being interest accruing on and after the issue of the stock) which first falls to be paid after the issue of that stock.
    (6) Regulations may make provision—

    (a) for entitling the holder of any debentures, debenture stock, preference shares or preference stock of a composite company, by notice given within the prescribed period, to require the company to transfer to him such amount of the British Electricity Stock issued to the company under this section as is attributable to the value of the said securities held by him, and for the cancellation of those securities to a proportionate extent; and

    (b) otherwise for the protection of mortgagees and incumbrancers of a composite company.—[Mr. Glenvil Hall.]

    Brought up, and read the First time.
    Mr. Glenvil Hall: I beg to move, "That the Clause be read a Second time."
    This new Clause is a corollary to the one which the Committee has accepted. It deals with the composite companies familiar to us all. It sets out the formula for the assessment of compensation for the electricity part to be taken over from these composite companies and the basis laid down is that set forth in Clause 17 with, of course, necessary changes. Unless the Committee desires it, I will not go through the formula; it is rather a complicated one. It is rather in favour of the company than of the Electricity Authority.
    Clause read a Second time, and added to the Bill.

    NEW SCHEDULE.—(Authorised Undertakers to whom Part II of Act applies.)

      Part I.
      Public and Local Authorities and Companies (other than Composite Companies).

      Aberayon and District Electricity Supply and

      Power Co. Ltd.

      Aberdare Urban District Council.

      Aberdeen Corporation.

      Abertillery Urban District Council.

      Aberystwyth Corporation.

      Accrington Corporation.

      Adwick-le-Street Urban District Council.

      Airdrie Corporation.

      Aldeburgh Electric Supply Co. Ltd.

      Alderley Edge & Wilmslow Electricity Board.

      Aldershot Corporation.

      Alton District Electricity Co. Ltd.

      Altrincham Electric Supply, Ltd.

      Amble Urban District Council.

      Ammanford Urban District Council.

      Ashbourne Urban District Council.

      Ashford Urban District Council.

      Ashton-in-Makerfield Urban District Council.

      Ashton-under-Lyne Corporation.

      Askrigg & Reeth Electric Supply Co. Ltd.

      Atherton Urban District Council.

      Aylesbury Corporation.

      Ayrshire Electricity Board.

      633

      Bacup Corporation.

      Bangor Corporation.

      Barking Corporation.

      Barnes Corporation.

      Barnoldswick Urban District Council.

      Barnsley Corporation.

      Barnstaple Corporation.

      Barrow-in-Furness Corporation,

      Barry Corporation.

      Basingstoke Corporation.

      Bath Corporation.

      Batley Corporation.

      Battersea Borough Council.

      Beckenham Corporation.

      Bedford Corporation.

      Bedfordshire, Cambridgeshire & Huntingdonshire Electricity Co.

      Bed was and Machen Urban District Council.

      Bedwellty Urban District Council.

      Bermonsey Borough Council.

      Bethesda Urban District Council.

      Bethnal Green Borough Council.

      Bexhill Corporation.

      Bexley Corporation.

      Bideford & District Electric Supply Co. Ltd

      Bingley Urban District Council.

      Birkenhead Corporation.

      Birmingham Corporation.

      Blackburn Corporation.

      Blackpool Corporation.

      Bland ford Forum & District Electric Supply Co. Ltd.

      Bolsover Urban District Council.

      Bolton Corporation.

      Borrowstounness Corporation.

      Borth & Ynyslas Electric Supply Co. Ltd.

      Boston & District Electric Supply Co. Ltd.

      Bournemouth Corporation.

      Bournemouth & Poole Electricity Supply Co Ltd.

      Bradford Corporation.

      Bredbury and Romiley Urban District Council

      Brentford & Chiswick Corporation.

      Brentford Electric Supply Co. Ltd.

      Brentwood District Electric Co. Ltd.

      Bridgend Urban District Council.

      Bridgwater & District Electric Supply & Traction Co. Ltd.

      Bridlington Corporation.

      Bridport Corporation.

      Brierfield Urban District Council.

      Brighouse Corporation.

      Brighton Corporation,

      Bristol Corporation.

      Bromley Corporation.

      Buckie Corporation.

      Buckrose Light & Power Co. Ltd.

      Bude Electric Supply Co. Ltd.

      Burford Electric Light & Power Co Ltd

      Burgess Hill Electricity Ltd.

      Burnham & District Electric Supply Co. Ltd

      Burnley Corporation.

      Burton-upon-Trent Corporation

      Bury Corporation.

      Buxton Corporation.

      Caernarvon Corporation.

      Caerphilly Urban District Council

      Calne Corporation.

      Cambridge Electric Supply Co. Ltd.

      Campbeltown and Mid-Argyll Electric Supply Co. Ltd.

      Cannock Urban District Council

      Canterbury Corporation.

      Cardiff Corporation.

      634

      Cardiff Rural District Council.

      Cark & District Electricity Co. Ltd

      Carlisle Corporation.

      Carmarthen Electric Supply Co. Ltd

      Castleford Urban District Council

      Central Electricity Board.

      Central London Electricity Ltd

      Central Sussex Electricity Ltd.

      Chasetown & District Electricity Co. Ltd

      Cheadle & Gatley Urban District Counc il

      Cheltenham Corporation.

      Chepstow Electric Lighting & Power Co. Ltd

      Chesham Electric Light & Power Co. Ltd

      Chester Corporation.

      Chesterfield Corporation.

      Chichester Corporation

      Chislehurst Electric Supply Co. Etcl.

      Chudleigh Electric Light & Power Co. Ltd.

      City of London Electric Lighting Co Ltd

      Clacton Urban District Council.

      Cleethorpes Corporation.

      Clitheroe Corporation.

      Clyde Valley Electrical Power Co.

      Coatbridge Corporation.

      Colchester Corporation.

      Colne Corporation.

      Colne Valley Electric Supply Co. Ltd.

      Colne Valley Urban District Council.

      Colwyn Bay Corporation.

      Congleton Corporation.

      Connah's Quay Urban District Council.

      Conway Corporation.

      Cornwall Electric Power Co.

      County of London Electric Supply Co. Ltd.

      Coventry Corporation.

      Craven Hydro-Electric Supply Co. Ltd

      Crewe Corporation.

      Crieff Electric Supply Co. Ltd.

      Crook and Willingdon Urban District Council

      Croydon Corporation.

      Culm Valley Electric Supply Co. Ltd.

      Cwmbran Urban District Council

      Darlington Corporation.

      Dartford Corporation.

      Darwen Corporation.

      Dawlish Electric Light & Power Co. Ltd

      Dearne District Electricity Board.

      Denny & Dunipace Corporation.

      Derby Corporation.

      Derbyshire & Nottinghamshire Electric Power Co.

      Dewsbury Corporation.

      Dolgelly Urban District Council.

      Doncaster Corporation.

      Dorchester Corporation.

      Dover Corporation.

      Dumbarton Corporation.

      Dumfries Corporation.

      Dumfriesshire County Council.

      Dunbartonshire County Council.

      Dundee Corporation.

      Dunoon & District Electricity Supply Co. Ltd.

      Ealing Corporation.

      Earby Urban District Council.

      East Anglian Electric Supply Co. Ltd

      East Dereham Urban District Council.

      East Devon Electricity Co. Ltd.

      East Grinstead Urban District Council.

      East Ham Corporation.

      East Retford Corporation.

      East Suffolk Electricity Distribution Co. Ltd.

      Eastbourne Corporation.

      Ebbw Vale Urban District Council.

      Eccles Corporation.

      Edinburgh Corporation.

      635

      Egham & Staines Electricity Co. Ltd.

      Electric Supply Corporation, Ltd.

      Electrical Distribution of Yorkshire, Ltd.

      Electricity Distribution of North Wales & District, Ltd.

      Elland Urban District Council.

      Epsom & Ewell Corporation.

      Erith Corporation.

      Eston Urban District Council.

      Exe Valley Electricity Co. Ltd.

      Exeter Corporation.

      Falkirk Corporation.

      Fareham Urban District Council.

      Farnworth Corporation.

      Faversham Corporation.

      Felixstowe Urban District Council.

      Fife Electric Power Co.

      Finchley Corporation.

      First Garden City, Ltd.

      Fleetwood Corporation.

      Folkestone Electricity Supply Co. Ltd.

      Foots Cray Electricity Supply Co. Ltd.

      Formby Urban District Council.

      Fort William Corporation.

      Frinton-on-Sea & District Electric Light & Power Co. Ltd.

      Fulham Borough Council.

      Gainsborough Urban District Council.

      Galloway Water Power Co.

      Gellygaer Urban District Council.

      Gillingham Corporation.

      Glasgow Corporation.

      Gloucester Corporation.

      Gorseinon Electric Light Co. Ltd.

      Grampian Electricity Supply Co.

      Grange Urban District Council.

      Gravesend Corporation.

      Great Yarmouth Corporation.

      Greenock Corporation.

      Grimsby Corporation.

      Guildford Corporation.

      Guisborough Urban District Council.

      Hackney Borough Council.

      Halifax Corporation.

      Hamilton Corporation.

      Hammersmith Borough Council.

      Hampstead Borough Council.

      Harrogate Corporation.

      Harwich Corporation.

      Haslingden Corporation.

      Hastings Corporation.

      Hawarden Rural District Council.

      Hawes Electric Lighting Co. Ltd.

      Hazel Grove & Bramhall Urban District Council.

      Hebden Royd Urban District Council.

      Heckmondwike Urban District Council.

      Helensburgh Corporation.

      Herne Bay & District Electricity Supply Co. Ltd.

      Hertford Corporation.

      Heston & Isleworth Corporation.

      Heywood Corporation.

      High Wycombe Corporation.

      Hindley Urban District Council.

      Hitchin Urban District Council.

      Holmfirth Urban District Council.

      Holsworthy Electric Supply Co. Ltd.

      Holyhead Urban District Council.

      Horley & District Electricity Supply Co. Ltd

      Hornsey Corporation.

      Horsham Urban District Council.

      Horwich Urban District Council.

      Hove Corporation.

      Hoylake Urban District Council.

      636

      Huddersfield Corporation.

      Ilford Corporation.

      Ilfracombe Electric Light & Power Co. Ltd.

      Ilkley Urban District Council.

      Inverness Corporation.

      Ipswich Corporation.

      Isle of Wight Electric Light & Power Co. Ltd.

      Islington Borough Council.

      Keighley Corporation.

      Kendal Corporation.

      Kent Electric Power Co.

      Keswick Electric Light Co. Ltd.

      Kettering Corporation.

      King's Lynn Corporation.

      Kingston-upon-Hull Corporation.

      Kingston-upon-Thames Corporation.

      Kirkcaldy Corporation.

      Kirkcudbright County Council.

      Lanarkshire County Council.

      Lanarkshire Hydro-Electric Power Co.

      Lancashire Electric Power Co.

      Lancaster Corporation.

      Leeds Corporation.

      Leek Urban District Council.

      Leicester Corporation.

      Leicestershire & Warwickshire Electric Power Co.

      Leigh Corporation.

      Lerwick Corporation.

      Lewes & District Electric Supply Co. Ltd.

      Leyton Corporation.

      Lichfield Corporation.

      Lincoln Corporation.

      Littleborough Urban District Council.

      Liverpool Corporation.

      Llandrindod Wells Urban District Council.

      Llandudno Urban District Council.

      Llanelly & District Electric Supply Co. Ltd.

      Llanfairfechan Urban District Council.

      Llangollen Urban District Council.

      Loch Leven Electricity Supply Co. Ltd.

      London & Home Counties Joint Electricity 'Authority.

      London Electric Supply Corporation Ltd.

      London Power Co. Ltd.

      Long Eaton Urban District Council.

      Lossiemouth and Brandenburgh Corporation.

      Lothians Electric Power Co.

      Loughborough Corporation.

      Louth Corporation.

      Lowestoft Corporation.

      Luton Corporation.

      Lyme Regis Corporation.

      Lynton & Lynmouth Electric Light Co. Ltd.

      Lytham St. Anne's Corporation.

      Macclesfield Corporation.

      Machynlleth Electric Supply Co. Ltd.

      Maesteg Urban District Council.

      Maidenhead Corporation.

      Maidstone Corporation.

      Malvern Urban District Corporation.

      Manchester Corporation.

      Mansfield Corporation.

      Margate, Broadstairs & District Electricity Board.

      Market Drayton Electric Light & Power Co. Ltd.

      Marlborough Corporation.

      Marple Urban District Council.

      Melton Mowbray Electric Light Co. Ltd.

      Menai Bridge Urban District Council.

      Mersey Power Co. Ltd.

      Merthyr Electric Traction & Lighting Co. Ltd.

      Metropolitan Electric Supply Co. Ltd,

      Mexborough Urban District Council.

      637

      Mid-Cheshire Electricity Supply Co. Ltd.

      Mid-Cumberland Electricity Co. Ltd.

      Mid-Lincolnshire Electric Supply Co. Ltd.

      Mid-Somerset Electric Supply Co. Ltd.

      Middlesbrough Corporation.

      Middleton Corporation.

      Midland Electric Corporation for Power Distribution Ltd.

      Midland Electric Light & Power Co. Ltd.

      Milford-on-Sea Electric Supply Co. Ltd.

      Milford Haven Urban District Council.

      Millom Rural District Council.

      Milnrow Urban District Council.

      Milton & Barton-on-Sea (Hants) Electricity Supply Co. Ltd.

      Minehead Electric Supply Co. Ltd.

      Mirfield Urban District Council.

      Mold Urban District Council.

      Monmouth Electricity Co. Ltd.

      Morecambe & Heysham Corporation.

      Morley Corporation.

      Motherwell & Wishaw Corporation.

      Mountain Ash Urban District Council.

      Musselburgh & District Electric Light & Traction Co. Ltd.

      Mynyddislwyn Urban District Council.

      Neath Corporation.

      Neath Rural District Council.

      Nelson Corporation.

      New Mills Urban District Council

      Newark Corporation.

      Newcastle & District Electric Lighting Co. Ltd.

      Newcastle-under-Lyme Corporation.

      Newcastle-upon-Tyne Corporation.

      Newmarket Electric Light Co. Ltd.

      Newport Corporation (Mon.).

      Newtown-le-Willows Urban District Council

      Normanton Urban District Council.

      North Berwick Corporation.

      North-Eastern Electric Supply Co. Ltd.

      North Lincolnshire & Howdenshire Electricity Co. Ltd.

      North of Scotland Electric Light & Power Co. Ltd.

      North Somerset Electric Supply Co. Ltd.

      North Wales and South Cheshire Joint Electricity Authority.

      North Wales Power Co. Ltd.

      North West Midlands Joint Electricity Authority.

      Northampton Electric Light & Power Co. Ltd

      Northmet Power Co.

      Northwood Electric Light & Power Co. Ltd.

      Norwich Corporation.

      Notting Hill Electric Lighting Co. Ltd.

      Nottingham Corporation.

      Nuneaton Corporation.

      Oban Corporation.

      Ogmore & Garw Urban District Council.

      Oldham Corporation.

      Ormskirk Electric Supply Co. Ltd.

      Ossett Corporation.

      Oswestry Corporation.

      Oxford Corporation.

      Padiham Urban District Council.

      Paignton Electric Light & Power Co. Ltd.

      Paisley Corporation.

      Peacehaven Electric Light & Power Co. Ltd

      Penarth Urban District Council.

      Penmaenmawr Urban District Council.

      Penrith Electric Supply Co. Ltd.

      Penybont Rural District Council.

      Perth Corporation.

      Peterborough Corporation.

      638

      Peterhead Electricity Co. Ltd.

      Petersfield Electric Light & Power Co. Ltd.

      Plymouth Corporation.

      Plympton St. Mary Rural District Council.

      Pontardawe Rural District Council.

      Pontypool Electric Light & Power Co. Ltd.

      Pontypridd Urban District Council.

      Poplar Borough Council.

      Port Talbot Corporation.

      Porthcawl Electricity Co, Ltd.

      Portland Urban District Council.

      Portsmouth Corporation.

      Prestatyn Urban District Council.

      Preston Corporation.

      Pudsey Corporation.

      Radcliffe Corporation.

      Ramsgate & District Electric Supply Co. Ltd

      Rawtenstall Corporation.

      Reading Corporation.

      Redcar Corporation.

      Reigate Corporation.

      Rhondda Urban District Council.

      Rhyl Urban District Council.

      Richmond (Surrey) Electric Light & Power Co Ltd.

      Richmond (Yorks) Corporation.

      Ringmer & District Electricity Co. Ltd.

      Ringwood Electric Supply Co. Ltd.

      Risca Urban District Council.

      Rochdale Corporation.

      Rotherham Corporation.

      Rugby Corporation.

      Rushden & District Electric Supply Co. Ltd.

      Ruthin Corporation.

      St. Austell & District Electric Lighting & Power Co. Ltd.

      St. Helens Corporation.

      St. Marylebone Borough Council.

      St. Pancras Borough Council.

      Sale Corporation.

      Salford Corporation.

      Salisbury Electric Light & Supply Co. Ltd.

      Scarborough Corporation.

      Scottish Central Electric Power Co.

      Scottish Midlands Electricity Supply Ltd.

      Scottish Southern Electric Supply Co. Ltd.

      Scunthorpe Corporation.

      Seaford & Newhaven Electricity Ltd.

      Seaham Urban District Council.

      Seaton and District Electric Light Co. Ltd.

      Sedbergh Electricity Supply Co. Ltd.

      Settle and District Electricity Co. Ltd.

      Sevenoaks & District Electricity Co. Ltd.

      Sheerness & District Electric Supply Co. Ltd.

      Sheffield Corporation.

      Shipley Urban District Council.

      Shoreditch Borough Council.

      Shoreham & District Electric Lighting & Power Co. Ltd.

      Shropshire, Worcestershire & Staffordshire Electric Power Co.

      Skelmorlie Electric Supply Co. Ltd.

      Skelton and Brotton Urban District Council.

      Skipton Urban District Council.

      Sleaford Urban District Council.

      Slough & Datcher Elactric Supply Co. Ltd.

      South Cumberland Electricity Supply Co. Ltd.

      South-East Kent Electric Power Co. Ltd.

      South-East Yorkshire Light & Power Co. Ltd.

      South London Electric Supply Corporation, Ltd.

      South Metropolitan Electric Light & Power Co, Ltd.

      South Shields Corporation.

      639

      South Somerset & District Electricity Co. Ltd.

      South Wales Electric Power Co.

      Southampton Corporation.

      Southend-on-Sea Corporation.

      Southport Corporation.

      Southwark Borough Council.

      Spalding Urban District Council.

      Spenborough Urban District Council.

      Stafford Corporation.

      Stalybridge, Hyde, Mossley & Dukinfield Transport & Electricity Board.

      Stanley Urban District Council.

      Stepney Borough Council.

      Steyning Electricity Ltd.

      Stirling Corporation.

      Stockport Corporation.

      Stockton-on-Tees Corporation.

      Stoke Newington Borough Council.

      Stoke-on-Trent Corporation.

      Stone Urban District Council.

      Stornoway Electric Supply Co. Ltd.

      Strathclyde Electricity Supply Co. Ltd.

      Stretford & District Electricity Board.

      Stroud Electric Supply Co. Ltd.

      sunderland Corporation.

      Sussex Electricity Supply Co. Ltd.

      Sutton Coldfield Corporation.

      Swansea Corporation.

      Swindon Corporation.

      Swinton & Pendlebury Corporation.

      Tadcaster Electricity Co. Ltd.

      Tamworth District Electric Supply Co. Ltd

      Taunton Corporation.

      Teignmouth Electric Lighting Co. Ltd

      Thornbury & District Electricity Co. Ltd.

      Thornton Cleveleys Urban District Council

      Thurrock Urban District Council.

      Thurso & District Electric Supply Co. Ltd.

      Tiverton Corporation.

      Tobermory Corporation.

      Todmorden Corporation.

      Tonbridge Urban District Council

      Torquay Corporation.

      Towyn, Aberdovey and District Electricity Co. Ltd.

      Tredegar Urban District Council.

      Trent Valley & High Peak Electricity Co. Ltd.

      Tunbridge Wells Corporation.

      Turton Urban District Council.

      Tynemouth Corporation.

      Ulverston Urban District Council

      Urban Electric Supply Co. Ltd.

      Uttoxeter Urban District Council.

      Uxbridge & District Electric Supply Co. Ltd.

      Wakefield Corporation.

      Wallasey Corporation.

      Walsall Corporation.

      Walthamstow Corporation.

      Walton and Weybridge Urban District Council.

      Warmley Rural District Council.

      Warrington Corporation.

      Watford Corporation.

      Weald Electricity Supply Co. Ltd.

      Wellingborough Electric Supply Co. Ltd.

      Wellington District Electricity Co. Ltd

      Welwyn Garden City Electricity Supply Co. Ltd.

      Wessex Electricity Co.

      West Bromwich Corporation.

      West Cambrian Power Co. Ltd.

      West Devon Electric Supply Co. Ltd.

      West Gloucestershire Power Co. Ltd.

      West Ham Corporation.

      640

      West Hampshire Electricity Co. Ltd.

      West Hartlepool Corporation.

      West Kent Electric Co. Ltd.

      West Lothian County Council.

      West Midlands Joint Electricity Authority.

      West Riding Automobile Co. Ltd.

      Westmorland and District Electricity Supply Co. Ltd.

      Weston-super-Mare & District Electric Supply Co. Ltd.

      Weymouth and Melcombe Regis Corporation.

      Whitby Urban District Council.

      Whitehaven Corporation.

      Whitstable Electric Co. Ltd.

      Whitworth Urban District Council.

      Wick Corporation.

      Wickford & District Electricity Supply Co. Ltd.

      Wigan Corporation.

      Wigtownshire Electricity Co. Ltd.

      Willesden Corporation.

      Wilton Electricity Supply Co. Ltd.

      Wimbledon Corporation.

      Winchester Corporation.

      Windermere & District Electricity Supply Co Ltd.

      Windsor Electrical Installation Co. Ltd.

      Wisbech Electric Light & Power Co. Ltd

      Witney Urban District Council.

      Woking Electric Supply Co. Ltd

      Wolverhampton Corporation.

      Woodstock & District Electrical Distribution Co. Ltd.

      Woolwich Borough Council

      Worcester Corporation.

      Workington Corporation.

      Worksop Corporation.

      Worthing Corporation.

      Wrexham Corporation.

      Yale Electric Power Co. Ltd

      York Corporation.

      Yorkshire Electric Power Co

      Part II.
      Composite Companies

      Ascot District Gas & Electricity Co.

      Bognor & District Gas & Electricity Co.

      Brixham Gas & Electricity Co-

      Bungay Gas & Electricity Co.

      Farnham Gas & Electricity Co.

      Guildford Gas Light & Coke Co.

      Mid Southern Utility Co.

      Oakham Gas & Electricity Co. Ltd.

      Salcombe Gas & Electricity Co. Ltd.

      Whitchurch (Hants) Gas & Electricity Co. Ltd.

      Uckfield Gas & Electricity Co.

      Yorktown (Camberley) Gas & Electricity Co.— [Mr. Gaitskell.]

      Brought up, and read the First time.
      Mr. Gaitskell: I beg to move, "That the Schedule be read a Second time."
      As the Committee will be aware, this new Schedule contains a list of authorised undertakers which we propose should be taken over under the Bill., It is not, of course, a complete list of all the undertakings because, as I explained earlier, we are also taking over several power station companies and the holding com-

      641
      panies, but it is a list of authorised undertakings, a description of which is provided in the earlier new Clause which I moved. There is perhaps no ^need for me to say very much. I might just refer to Part II, which lists composite companies. These are those which have gas or water supplies and they are put in a separate class simply for convenience. I think the Committee generally will agree that this is more satisfactory and a clearer way of dealing with the position than leaving it to some entirely general definition. It is true that it takes up a lot more paper and has involved us in a little more time, but it has the merit that, so far as the authorised undertakings are concerned, they know exactly where they stand. I do not think there is any serious question that is likely to arise.
      Perhaps I might further inform the Committee of one or two things which may not be entirely clear from my earlier remarks on the new Clause. We do not include, in this list of various undertakings, certain companies which supply electricity mainly for their own use or the use of their parent companies. We have in mind the Lochaber Power Company, which supplies power for a large aluminium works which is a new feature of industrial development in Scotland. We have also managed to exclude, in the proviso, local authorities supplying electricity for their own transport undertakings. Indeed, it was on this point that we had the greatest difficulty with our definition, because our legal advisers told us that the Opposition's definition to define authorised undertakers as bodies which supplied the general public was not, unfortunately, satisfactory or adequate because "general public" appears to include local tramway or other transport undertakings. Therefore, the Government had to start thinking again and they are very definitely excluded by means of the admirable device of the Schedule. We also exclude from the list companies which carry on transport undertakings but do not supply electricity under a provisional or special order. The object of this proviso is to exclude companies such as the South Lancashire Transport Company, which is primarily a transport undertaking, but which supplies electricity by virtue of a Private Act, but not under a provisional or special order.
      Schedule read a Second time, and added to the Bill.
      Bill, as amended, to be reported.
      Bill reported, with Amendments; as amended (in the Standing Committee and on re-committal), considered; to be read the Third time upon Monday next, and to be printed. [Bill 90.]

  WAYS AND MEANS
  [23rd June]
  Resolutions reported:

  PURCHASE TAX (ROAD VEHICLES)
  "That, as from the eighteenth clay of June, nineteen hundred and forty-seven, and subject to any subsequent order under Section twenty of the Finance (No. 2) Act, 1940, purchase tax shall be charged at an intermediate rate equal to two-thirds of the value of the goods, in respect of mechanically propelled passenger road vehicles of a retail value of more than one thousand two hundred and eighty pounds a vehicle, the retail value of a vehicle and the articles to be treated as forming part thereof being ascertained in such manner as may be provided by or under any Act of the present Session relating to Finance and so as to include value attributable to payment of tax at the basic rate.
  In this Resolution the expression "passenger road vehicles" means road vehicles constructed or adapted solely or mainly for the carriage of passengers, or having, to the rear of the driver's seat, roofed accommodation lit by side windows and fitted with, or constructed or adapted for the fitting of, seating for passengers."

  EXCISE (MECHANICALLY PROPELLED VEHICLES)
  Resolved:
  "That, as from the first day of January, nineteen hundred and forty-eight, the duties of excise chargeable under section thirteen of the Finance Act, 1920, in respect of mechanically propelled vehicles chargeable with such duties under paragraph 6 of the Second Schedule to that Act, other than electrically propelled vehicles, shall, in the case of such a vehicle registered under the Roads Act, 1920, for the first time on or after the first day of January, nineteen hundred and forty-seven, be charged at the rate of ten pounds for the vehicle."-—[Mr. Glenvil Hall.]
  Instruction to any Committee to which the Finance Bill may be recommitted, that they have power to make provision therein pursuant to the said Resolutions. —[Mr. R. J. Taylor.]

  SUNDAY CINEMATOGRAPH ENTERTAINMENTS
  Resolved:
  "That the Order made by the Secretary of State for the Home Department, extending Section I of the Sunday Entertainments Act, 1932, to the Rural District of Blackwell, a copy of which Order was presented on 23rd June, be approved."
  "That the Order made by the Secretary of State for the Home Department, extending Section I of the Sunday Entertainments Act, 1932, to the Borough of Bridgnorth, a copy of which Order was presented on 23rd June, be approved."
  "That the Order made by the Secretary of State for the Home Department, extending Section I of the Sunday Entertainments Act, 1932, to the County Borough of Darlington, a copy of which Order was presented on 23rd June, be approved."
  "That the Order made by the Secretary of State for the Home Department, extending Section I of the Sunday Entertainments Act, 1932, to the County Borough of Ipswich, a copy of which Order was presented on 23rd June, be approved."
  "That the Order made by the Secretary of State for the Home Department, extending Section I of the Sunday Entertainments Act, 1932, to the City and County of Kingston-upon-Hull, a copy of which Order was presented on 23rd June, be approved."
  "That the Order made by the Secretary of State for the Home Department, extending Section I of the Sunday Entertainments Act, 1932, to the Rural District of Mildenhall, a copy of which Order was presented on 23rd June be approved."—[Mr. Oliver.]

  VENEREAL DISEASE (OVERSEAS FORCES).
  Motion made, and Question proposed, "That this House do now adjourn."— [Mr. J. Henderson.]
  1.38 a.m.
  Dr. Segal: I must apologise to the House for detaining hon. Members at this late hour, but this subject is one over which a good many families in this country have lost a considerable amount of sleep, so if hon. Members who remain lose another half-hour of sleep, they may perhaps regard it as being justified. I think it is best to approach the problem from the medical angle. It cuts so deeply at the root of many of the bases of our national life that it is highly desirable to avoid, as far as possible, anything in the nature of scare-mongering or sensationalism. Many hon. Members have received representations from several
  644
  quarters since the publication of figures during a Debate which occurred recently in another place.
  At the outset, I should like to state my conviction that the British soldier is less prone to venereal disease than the soldiers of any Allied force. I base this claim on medical experience overseas during the war in various theatres, extending over a period of four and a half years, and in various combined units where the personnel of no fewer than eight Allied and Dominion Powers were represented. I think it advisable in dealing with this matter to avoid quoting statistics. I believe the statistics that have already been given elsewhere are subject to certain fallacies because, whereas they deal with the incidence of venereal disease over a period of 12 months per 1,000 men in a given Command, I think they fail to take into account that these 1,000 men over a period of 12 months were largely in a mobile state, with various changes taking place through posting and replacement. Hence over a period of 12 months the numbers were probably considerably increased. There is another reason why it is largely inadvisable to quote statistics in this connection. I believe that the actual incidence of venereal disease, although the figures quoted already are grave, are only symptomatic of a far graver problem.
  I believe the real problem that faces us today is how far risks of exposure to disease have been taken for every given case of disease which has been recorded. With the wide dissemination of knowledge on this subject among troops of all Services, with the well-known methods of prophylaxis and early treatment, with the high percentage of cures and the relatively low proportion of relapses and recurrences, I think that even if the figures had been less serious than those actually given, they would still occasion grave disquiet They are symptomatic of a state of affairs that has followed in the wake of every major war and are a result of a general loosening of moral ties which affects many other countries today besides our own
  In so far as this problem affects our troops stationed at home, it is not primarily the concern of the War Office. It is, firstly, the concern of the Church upon whom lies the responsibility of preaching incessantly the ideals of self-discipline and self-restraint, of a high

  645
  standard of moral values and of the sanctity of family life. A heavy responsibility rests upon the State in making higher standards of education available to as large a proportion of the population as possible; a responsibility also devolves upon the State to lay special emphasis on the provision of houses for newly-married couples, and to establish a graded system of family allowances with a rising scale whereby the amount would increase with each successive child; and, finally, a heavy responsibility rests upon each individual to inculcate higher ideals of family life and human values in his own particular family circle.
  But in so far as this problem affects troops stationed overseas, it is primarily the responsibility of the War Office. In that connection the War Office acts as trustee on behalf of the nation for the welfare of all the troops committed to its care overseas, and I would like to ask the Minister two questions. How can he explain the relatively high rate of incidence of venereal disease in the Far East at a figure no less than six times as high as the rate in the Middle East? How far can he explain why the rate of venereal disease in Germany and Austria today is almost five times as high as the rate existing in the Middle East? These are questions which have caused great disquiet among many sections of our community. I think they are matters which may be explained to some extent by the state of affairs immediately following upon six years of war, but there are several suggestions which I would like to bring to the notice of the War Office.
  I feel very strongly that it should be the aim of the War Office to encourage the recruit to retain as far as possible his civilian outlook during the brief term of his military service. I feel that a great deal more can be done in regard to the branches of the Services that deal with the moral and cultural well-being of the man in the Forces, particularly the three branches, welfare, chaplaincy and educational. I think these three branches should endeavour to form their civilian counterparts in each of the three services. During the war incalculable good was done in many parts of the world through the medium of civilian agencies which voluntarily cared for the welfare of our troops. In Kenya there was a scheme by
  646
  which troops on local leave were offered hospitality on English farms in the uplands of Kenya. Throughout Egypt and Palestine, civilian agencies established service clubs, arranged hospitality for troops in private families and organised tours in certain districts, entirely on a voluntary basis.
  Cannot the War Office try to encourage similar activities even in occupied territories like Germany and Austria, in Greece, in Palestine, in India, in Malaya and even in Japan? In British Colonies today there will, surely, be no excuse for civilian organisations not doing their utmost to assist the moral and cultural welfare of our troops, by giving them an opportunity of contact with the healthy side of family life in normal surroundings. During the war some of the most harrowing experiences that occurred were instances of highly placed officers, after three agonised years of separation from their families at home, finally reaching the point of breaking down, and then afterwards harbouring the suspicion that their wives away in England had also been unable to overcome the various temptations that surrounded them. There were cases during the war where the whole efficiency of a squadron suffered as a result of the shock that a senior officer might have sustained. If we concede a certain moral code to one sex today, it is surely difficult to deny it also to the other sex, and if we face the implications of an individual sowing his wild oats and accept this principle on a national scale, there is no doubt that we shall ultimately undermine the whole future of our national life.
  I urge the Minister to give some assurance to the many families in England today who feel profound disquiet at the figures which have been revealed in another place; and I urge him to realise that, in so far as the welfare of our troops overseas is concerned, the War Office acts as a trustee on behalf of our nation. I would ask him to endeavour to take such steps during the coming months as will substantially reduce the very disquieting figures which have been given to the public on this grave problem, and see that in the very near future very much less ground for uneasiness will exist in this country.
  1.50 a.m.
  The Under-Secretary of State for War (Mr. John Freeman): The few hon. Members remaining in the House at this very late hour will not, I think, seek to belittle in any way the importance of the subject which my hon. Friend has raised, and which he will be the first to admit can only just be touched on in an Adjourned Debate at this hour of the night. He has raised an issue of first-rate importance, and one which gives all of us who have any responsibility for the welfare of the Services considerable anxiety. Now, I would disagree with practically nothing which my hon. Friend has said. If I may say so with respect, I believe that his approach to the problem—and it is not a prophylactic but a positive approach, if I may put it in those terms —is the correct one. We shall only get over this difficulty by creating conditions in the Services overseas under which the temptation which leads to this particular scourge is less likely to arise. I applaud his decision not to get us involved this evening in a maze of statistics, which may be confusing; and I am certainly not going to rush in where he feared to tread.
  I would, however, like to give the House one or two simple figures which I think may be instructive. There are two points I would like to make with these figures. The first is that, although I would not in any way under-estimate the seriousness of the problem, there is some ground for thinking that there is a periodic rise in the incidence of this disease which one tends to get after a war; and the second point is that we are perhaps past the peak period. I would like to draw the attention of the House to one specimen list of figures covering the four quarters of last year and the first quarter of this year for the Rhine Army. Serious though these figures are, it will be noticed that they build up to a certain point, and then go down. What we hope is that this decline will be accelerated. For the first quarter of 1946, the Rhine Army figures were 30.4 per thousand; for the second quarter, 41.8; for the third quarter, 44.6; for the fourth quarter, 41.8; and for the first quarter of this year 30 per thousand. The buildup in the middle of last year, and the reduction at the end of last year and the beginning of this year, are reflected substantially in the Commands.
  648
  It is perhaps also worth pointing out—although I need hardly say that I make no political point of this, it is an interesting statistic—that while these are terrible figures, they are on this occasion lower than they were for a similar period after the first world war Once again, one must be careful not to make too much of that, but I would remind the House that men are far more ready to report this disease than they were in the past when disciplinary action was taken against them, and we can have some modified satisfaction that the figures are not so high. My hon. Friend asks why the incidence of the disease in the Middle East should be lower than in the Far East and North Western Europe. His guess is as good as mine. I cannot give a clear answer, but I would say that the conditions under which men live in the Services in the Middle East, substantially removed from female companionship, has a great deal to do with it.
  Dr. Segal: I spoke about the low incidence in the Middle East which is easy to explain, but I would ask why the figures are so high in the Far East and in Europe.
  Mr. Freeman: The relative highness and lowness are converse in the same picture. But the fact is that in the Middle East the conditions are not conducive to venereal disease. In Germany and Austria and in the Far East they are, and in both areas the incidence of the disease among the civilian population is high. In the Far East it has been extremely difficult to control the sources of infection and only recently have we started to make progress in this side of the problem. I should like to say we recognise fully the importance of trying to give the Service man the opportunity of making civilian contacts during his Service life and I have obtained some figures which prove to my satisfaction that we have more civilians doing welfare work overseas than we had during the war. I do not say we could not use more of these workers, but in the Rhine Army—from which area figures of the disease were taken—whereas there are 187 N A.A.F.I. or Service canteens, there are 207 rest centres and canteens run by voluntary bodies, and there are 928 voluntary civilian workers operating. These workers are going a great job in helping to raise the standard of civilian life. My hon. Friend's remarks about the

  649
  work of the chaplains, and education, I can only endorse.
  It is quite obvious that, while it is possible to take medical measures to limit the seriousness of this problem where it has started, the way to eliminate the problem altogether is by a moral, educational and welfare approach. We are doing the best we can in that direction and I do not want my hon. Friend to think we have overlooked the value of giving lectures to the soldiers before they leave their stations to go abroad. These obvious points have been thought of, and effect is being given to them. We cannot solve this problem merely by rule of thumb. It can be solved only if the War Office and the soldier co-operate and if the House and the public generally recog-
  650
  nise the seriousness of the problem in trying to cope with it. If any hon. Members have any suggestions to make that will help us in this problem I shall be only too glad to hear of them, and, if at all possible, put them into effect. In the meantime, I repeat that our view of this matter is that it is exceedingly serious and something that we cannot possibly afford to take lightly. We are doing our very best to cope with it, and on the figures we possess I think we have some ground for thinking, at the moment, that our efforts are being rewarded with, at any rate, a limited degree of success.
  Adjourned accordingly at Two o'Clock.

  SINGAPORE (HOUSING SHORTAGE)
  SINGAPORE (HOUSING SHORTAGE)
  SECONDARY SCHOOLS (BAHAMAS)
  SECONDARY SCHOOLS (BAHAMAS)
  HONG KONG UNIVERSITY
  HONG KONG UNIVERSITY
  WEST AFRICA (HOSPITAL EQUIPMENT)
  WEST AFRICA (HOSPITAL EQUIPMENT)
  DEAD SEA MINERAL RESOURCES
  DEAD SEA MINERAL RESOURCES
  CYPRUS (WAGES)
  CYPRUS (WAGES)
  GOVERNMENT EMPLOYEES, MAURITIUS
  GOVERNMENT EMPLOYEES, MAURITIUS
ROYAL NAVY
  Docks, Rosyth and the Clyde
  Docks, Rosyth and the Clyde
  Cadetship Examination (Personal Case)
  Cadetship Examination (Personal Case)
FOOD SUPPLIES
  Olympic Games Competitors (Rations)
  Olympic Games Competitors (Rations)
  Evaporated Milk and Luncheon Meat
  Evaporated Milk and Luncheon Meat
  Milk (Illegal Sales)
  Milk (Illegal Sales)
  Fish (Dumping)
  Fish (Dumping)
  Citrus Fruit Prices
  Citrus Fruit Prices
  Green Onions (Prices)
  Green Onions (Prices)
  Allocation (Widnes)
  Allocation (Widnes)
  Fried-Fish Shop, Hales
  Fried-Fish Shop, Hales
  Potato Shortage
  Potato Shortage
  Groundnut Scheme
  Groundnut Scheme
  SOAP SUPPLIES CHINGFORD
  SOAP SUPPLIES CHINGFORD
TELEPHONES
  Applications, Headington and Cowley
  Applications, Headington and Cowley
  Third-Party Connections
  Third-Party Connections
  Application, Thornton-le-Moor
  Application, Thornton-le-Moor
  RAILWAY RADIO COMMUNICATION
  RAILWAY RADIO COMMUNICATION
POST OFFICE
  Postal Services
  Postal Services
  Mail-Bags (Losses)
  Mail-Bags (Losses)
  Political Slogans (Envelopes)
  Political Slogans (Envelopes)
  Canadian Gift Parcels
  Canadian Gift Parcels
  AUTHORISED BROADCASTING STATIONS
  AUTHORISED BROADCASTING STATIONS
  BROADCAST ANNOUNCEMENTS (GOVERNMENT DEPARTMENTS)
  BROADCAST ANNOUNCEMENTS (GOVERNMENT DEPARTMENTS)
ROYAL AIR FORCE
  Allowances (Greece)
  Allowances (Greece)
  Auxiliary Force (Expenditure)
  Auxiliary Force (Expenditure)
  Boxted Aerodrome
  Boxted Aerodrome
  Married Quarters (Recruiting Advertisement)
  Married Quarters (Recruiting Advertisement)
  W.A.A.F. (Release Dates)
  W.A.A.F. (Release Dates)
  Extended Service (Regular Airmen)
  Extended Service (Regular Airmen)
  Discharges (Tuberculosis)
  Discharges (Tuberculosis)
CIVIL AVIATION
  Orkney Services
  Orkney Services
  West Country
  West Country
  Charter Companies
  Charter Companies
  Departmental Posts (Qualifications)
  Departmental Posts (Qualifications)
  London Airport (Public Enclosure)
  London Airport (Public Enclosure)
  Glasgow-Belfast Service
  Glasgow-Belfast Service
GERMANY
  Forest Regeneration
  Forest Regeneration
  Electric Generating Plant
  Electric Generating Plant
  Grain Collections
  Grain Collections
  Food Situation
  Food Situation
  Coal Output
  Coal Output
  SENORA PERON'S VISIT
  SENORA PERON'S VISIT
  HUNGARY (POLITICAL SITUATION)
  HUNGARY (POLITICAL SITUATION)
  RUSSIAN-BORN WIVES
  RUSSIAN-BORN WIVES
  POLAND (POLITICAL ARRESTS)
  POLAND (POLITICAL ARRESTS)
  PALESTINE (U.S. PRESS ADVERTISEMENT)
  PALESTINE (U.S. PRESS ADVERTISEMENT)
TRADE AND COMMERCE
  Individual Output
  Individual Output
  Raw Materials (Certificates)
  Raw Materials (Certificates)
  Grantham Productions, Limited (Factories)
  Grantham Productions, Limited (Factories)
  Clothing Coupons
  Clothing Coupons
  COUNTY COURT, CROMER
  COUNTY COURT, CROMER
  BRITISH ARMY (AIR MAIL, ITALY)
  BRITISH ARMY (AIR MAIL, ITALY)
  TONGALAND (VEGETABLE OIL PRODUCTION)
  TONGALAND (VEGETABLE OIL PRODUCTION)
  TEACHERS (STATISTICS)
  TEACHERS (STATISTICS)
  SWITZERLAND (INTERNATIONAL RAILWAY CONGRESS)
  SWITZERLAND (INTERNATIONAL RAILWAY CONGRESS)
  TRANSPORT (CHILDREN'S HALF-FARES)
  TRANSPORT (CHILDREN'S HALF-FARES)
  WORKERS' HOSTEL, FEATHERSTONE
  WORKERS' HOSTEL, FEATHERSTONE
  OLD AGE PENSIONS
  OLD AGE PENSIONS

Preamble
The House met at half past eleven of the clock, The LORD AMMON on the Woolsack.
Prayers.

KENSINGTON PALACE.
11.35 a.m.
LORD BROUGHSHANE: My Lords, I beg to ask the question standing in my name on the Order Paper.
[The question was as follows:
To ask His Majesty's Government, whether they are aware of the serious state of disrepair of Kensington Palace, the birthplace of Queen Victoria; and what steps are being taken to carry out the necessary works which are urgently needed to preserve this beautiful and historic building, fast falling into decay.]
LORD HENDERSON: My Lords, a certain amount of minor repair work has been carried out and more is now in progress, but the bomb damage to Kensington Palace is extensive and major works of reconstruction, amounting in part to complete rebuilding, are necessary. Owing to the shortage of labour and materials this work of major reconstruction has had to be deferred, but it is hoped that a start will not be long delayed.
LORD BROUGHSHANE: Is the Minister and are the Government aware of the disreputable and uncared-for appearance of the external part of the Palace, with dirty pieces of paper flapping in the wind towards the Kensington Road, which causes most adverse comment from people looking at the Palace? Is he also aware that Kensington Palace is an historic national building where no fewer than four English sovereigns were born and died, and that our beloved Queen Mary was also born there, as well as Queen Victoria; and that the general public are very incensed that this building should be allowed to remain in this dreadful state of repair? If something could be done temporarily, without rebuilding, it
220
Would perhaps be a little more decent to look at.
LORD HENDERSON: I am aware of what is stated in the second part of the noble Lord's supplementary question, but not of what is stated in the first part. Now, however, that the noble Lord has put the point in the form of a question, I will draw my, right honourable friend's attention to the fact.

SCHOOLBOY ROAD SAFETY PATROLS.
LORD HAWKE: My Lords, I beg to ask the question standing in the name of my noble friend, the Earl of Iddesleigh.
[The question was as follows:
To ask His Majesty's Government, whether advantage will be taken of the forthcoming return of British school teachers from the United States of America to obtain further information of the working of the Schoolboy Road Safety Patrols in that country.]
LORD WALKDEN: My Lords, information is already available in this country about American practice, but His Majesty's Government would, of course, be glad to receive any further information of interest on this matter, either from teachers or from any other persons who have studied the operation of schoolboy road safety patrols in the U.S.A.
LORD HAWKE: I thank the noble Lord for his reply.

STATISTICS OF TRADE BILL.
11.38 a.m.
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—(Viscount Hall.)
On Question, Motion agreed to.
House in Committee accordingly:
[The EARL OF DROGHEDA in the Chair.]
Clause 1 [Power of competent authorities to obtain information]:
THE FIRST LORD OF THE ADMIRALTY (VISCOUNT HALL): The first Amendment is purely a drafting Amendment. I beg to move.
Amendment moved—
Page 1, line 16, leave out ("estimate or return is") and insert ("estimates or returns are").—(Viscount Hall.)
On Question, Amendment agreed to.
Clause 1, as amended, agreed to.
Clause 2 agreed to.
Clause 3 [Returns for the purposes of census]:
VISCOUNT HALL: This also is a drafting Amendment. I beg to move.
Amendment moved—
Page 2, line 35, leave out ("in the last foregoing subsection") and insert ("therein").—(Viscount Hall.)
On Question, Amendment agreed to.
VISCOUNT HALL: This again is a drafting Amendment. I beg to move.
Amendment moved—
Page 2,line 37, at end insert ("A notice issued by a competent authority in pursuance of powers delegated to that authority shall state that it is so issued").—(Viscount Hall.)
On Question, Amendment agreed to.
Clause 3, as amended, agreed to.
Clause 4:
Offences relating to returns.
(3) If any person in purported compliance with a requirement to furnish such estimates or returns as aforesaid, knowingly or recklessly makes any statement in those estimates or returns which is false in a material particular he shall be liable on summary conviction to imprisonment for a term not exceeding three months or to a fine not exceeding fifty pounds or on conviction on indictment to imprisonment for a term not exceeding two years or to a fine not exceeding one hundred pounds, or, in either case, to both such imprisonment and such fine.
LORD HAWKE LORD HAWKE moved, at the end of the clause to insert:
"Provided that no such person be liable to fine or imprisonment if he shows he had, within the previous three months, given substantially the same information in compliance with the demand from another Department of Government other than the Board of Trade."
The noble Lord said: I beg to move the Amendment standing in the name of my noble friend. This Bill gives power to the Board of Trade to delegate to competent authorities the collection of information from trade and industry. These competent authorities are some fourteen or fifteen in number, and the purpose of
222
the Amendment is to try to ensure that there will be some co-ordination in the demands of these various competent authorities, and that one Department may not have the power to ask for precisely the same information as has already been furnished to another Department.
To anybody who has ever occupied a desk in Whitehall it is well known that it is very much easier sometimes to go direct to trade and industry to obtain figures than to search through the warrens of Whitehall to find whether they are there already. Our Amendment seeks to remove that temptation from the competent authorities. Perhaps while the noble Viscount is accepting our Amendment he might, at the same time, be able to give us some assurance that there will be an attempt at co-ordination between the competent authorities under this Bill and the development councils under the Industrial Organisation Bill, for under that measure certain heavy industries are to have development councils and those development councils are to be empowered to ask for information which, in many cases, will be precisely the same as the competent authorities will have acquired under this Bill. In the circumstances, I hope for an acceptance and an assurance. I beg to move.
Amendment moved—
Page 3, line 23 at end insert the said proviso.—(Lord Hawke.)
LORD WOLVERTON: I should like to support my noble friend on this Amendment because we, on this side of the House, feel it is very important that trade should not be asked for the same information by different Departments. I think we all agreed on the Second Reading that extra information was necessary for the statistical departments, but it should be collated through one department, if possible. For that reason, I should like to support my noble friend on this Amendment.
VISCOUNT HALL: His Majesty's Government are very conscious of the anxiety in industry concerning the collection of statistics, a practice which inevitably grew up during the period of the war, and still exists. But your Lordships will remember that on the Second Reading I expressed the fervent hope that there would be some lightening of the burden of the filling in of forms as com-

223
pared with the recent past, and I want to assure both Lord Hawke and Lord Wolverton that His Majesty's Government will do anything and everything possible to prevent overlapping. I am afraid we cannot accept the Amendment because it is going to be difficult to define what might be regarded as "substantially the same," but I can repeat the assurance which I myself gave, and which was given by my right honourable friend in another place when this matter was being considered. With that assurance, I hope the noble Lord will withdraw his Amendment.
LORD HAWKE: I thank the noble Viscount for his assurance, and I am perfectly certain that trade and industry will be very happy to hear of it. I wonder if he can perhaps say a word on the question of the development councils, as to whether there is any chance of co-ordinating their demands with those of the competent authorities under this Bill?
VISCOUNT HALL: It is very difficult to say, because development councils exist with various responsibilities in different parts of the country, and it is impossible to give what might be regarded as a very wide promise. But I will convey to the President of the Board of Trade the wish of my noble friend, and I certainly will ask him to consider it.
LORD HAWKE: I thank the noble Viscount, and with that assurance I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 4 agreed to.
Clauses 5 to 8 agreed to.
On Question, Whether Clause 9 shall stand part of the Bill:
LORD HAWKE: Noble Lords on this side of the House are pleased to see that there is a very severe penalty clause in subsection' (6) of this clause. The original clause was strengthened in another place, and we feel that it will have a very good effect on those persons who may be called upon to handle the statistics collected, which they might, through familiarity, tend to treat with undue levity. Another point which was altered in another place gives us much pleasure, and that was that information collected under the Bill can be used only for prosecutions under this
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Bill; previously it could be used for prosecutions in a much wider field. In those regards we think the other place has greatly improved the Bill.
Clause 9 agreed to.
11.49 a.m.
Clause 10:
Information from persons entering or leaving the United Kingdom by air.
10.—(1) The Board of Trade may by order make provision whereby persons entering or leaving the United Kingdom by air may be required to give such information, in such form and manner, and to such persons, as may be prescribed.
VISCOUNT HALL VISCOUNT HALL moved in subsection (1) to leave out from "whereby" to the end of the subsection and insert:
"any person entering or leaving the United Kingdom by air may be required to give, to such person and in such form and manner as may be prescribed, particulars of his age, sex and marriage and of the nature of his occupation and particulars of the country in which he last permanently resided and the country in which he intends next permanently to reside.
(2) If it is not reasonably practicable to require any such person to give any such particulars as aforesaid any other person in whose company and under whose care he is travelling may be required to give those particulars on his behalf."
The noble Viscount said: This Amendment gives effect to a promise made by the President of the Board of Trade in another place that he would make more specific the nature of the information that can be required from persons entering or leaving the United Kingdom by air. The Amendment provides that the information to be obtained from passengers shall be substantially the same as that which can already be obtained from passengers travelling by sea. This Amendment is, I think I can claim, an agreed Amendment, because noble Lords on the Opposition Benches have agreed that it does indeed cover the points which were raised. I beg to move.
Amendment moved—
Page 6, line 40, leave out from ("whereby") to the end of line 42 and insert the said new words.—(Viscount Hall.)
LORD HAWKE: This Amendment meets the wishes of my noble friend, Lord Balfour of Inchrye, who has asked me to convey his apologies to the noble Viscount for being unable to be present in person to thank him for it.
On Question, Amendment agreed to.
Clause 10 as amended, agreed to.
Clause 11 to 16 agreed to.
Clause 17.
Interpretation
(3) For the purposes of this Act each of the following Ministers and authorities shall be a competent authority, that is to say, the Treasury, a Secretary of State, the Admiralty, the Board of Trade, the Minister of Fuel and Power, the Minister of Agriculture and Fisheries, the Minister of Health, the Minister of Labour and National Service, the Minister of Transport, the Minister of Supply, the Minister of Food, the Minister of Works, the Minister of Civil Aviation and the Minister of Pensions.
VISCOUNT HALL VISCOUNT HALL moved, in subsection (3), after "Minister of Food" to insert "the Minister of National Insurance. "The noble Viscount said: My Lords, I beg to move this Amendment to Clause 17. The purpose of the Amendment is to name the Minister of National Insurance as a ompetent authority under the Bill. Under the existing law, the Ministry of National Insurance have no power to obtain information for statistical purposes, though naturally in the course of their administration of the National Insurance Act a great deal of information useful for statistical purposes will arise, as it has done in the past out of the administration of the Unemployment Insurance Act and the National Health Insurance Act.
The Minister of National Insurance is being added as one of the competent authorities under this Bill so that if statistical information is needed about the insured population additional to that becoming available as a result of the administration of the National Insurance Act, the Minister should be able to collect it. Therefore it is neessary to insert these words in the Bill. I beg to move.
Amendment moved—
Page 9, line 37, after ("Food") insert ("the Minister of National Insurance").—(Viscount Hall.)
On Question, Amendment agreed to.
Clause 17, as amended, agreed to.
Remaining clauses agreed to.
Schedule agreed to.
House resumed.

FIRE SERVICES BILL.
11.55 a.m.
Order of the Day for the Second Reading read.
LORD WALKDEN: My Lords, in certain sections of the Press there has been published a statement to the effect that this is a measure of denationalization. It was suggested that it was rather queer that this present Government should start to denationalize a measure which was passed by the Coalition Government of 1941. I hasten to assure your Lordships that what appeared in the Press was only a rumour. We do not contemplate handing this valuable public service over to private contractors, and if any of your Lordships should be so unfortunate as to have a fire at your homes you will not have to ring up some such person and get him to bring along an early English pattern fire engine to deal with the outbreak. The public service will be maintained as before, and I believe in an even higher state of efficiency. So there is no retrogression.
This Bill will bring to an end the National Fire Service which, as I have said, was established in 1941 and will provide for a thorough reorganization through county and county borough councils. It will also provide a new pension scheme for the firemen, and permanent Whitley Council arrangements for dealing with all their conditions of employment. Further, it will authorize terms of compensation for persons who may become redundant in the Service by reason of changes in organization. That is done by Clause 5. The Bill also makes ample provision for the adaptation of the measure to Scotland. There will be representative advisory councils, both for Scotland and for England and Wales.
If I may, I would like to give a brief survey of the developments which have led up to the present position. Before 1938, the London County Council were the only local authority required by law to maintain a fire brigade. Other councils, did, in fact, maintain, fire fighting organizations but these were often allied with their police forces. They had widely varying degrees of efficiency and often they had to work with very out-of-date equipment. In 1938—just before the last war—the Fire Brigades Act was carried by the then Conservative Govern-

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ment. It was based on the recommendations of a Departmental Committee over which Lord Riverdale presided. The Act provided for large-scale reorganization of the whole of the local services, and for the first time it brought them under national control, through the Home Office and the borough and county councils. The provision of fire brigades in all council areas was made compulsory, and they all came under the suzerainty of the Home Secretary.
The borough and county councils were all required to provide efficient fire services and to make effective arrangements for giving mutual aid to one another when called upon to do so. The old parochial individualism of former days was swept away just in time to meet the circumstances which developed on the breaking out of the war. The Home Secretary provided the fire brigades then with all the emergency equipment they needed. It reached a great total and more than made up for the absence of any financial grant-in-aid to the new authorities. Our new Bill will provide for regular grants up to 25 per cent. of their expenses. The Act of 1938 for the first time made the Home Secretary responsible for the supervision of all the fire services, and it authorized the appointment of Government inspectors to assist him in that work. He was also given a Fire Services Commission to help him. Then he was empowered to appoint fire service boards to supersede local authorities where they failed to provide efficient fire services.
By the time the war broke out we had 1,668 fire authorities and a total of 6,600 whole-time firemen. There were also 16,000 part-time firemen. But that was not nearly enough. It was soon found necessary to organize an Auxiliary Fire Service. That grew up until it had a whole-time personnel of 75,000, with 120,000 part-timers. They bore the brunt of the first German incendiary attacks, and bore them magnificently. We can never forget the debt of gratitude that we owe to them for preserving many of our towns and cities from utter destruction by fire. By 1941, however, it was found necessary to strengthen and improve the organization to provide for unity of command and the integration of the small units. For that purpose the National Fire Service was established, by the Fire Ser-
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vice (Emergency Provisions) Act, 1941, to meet the increasing strain of the incendiary attacks. At its peak our National Fire Service organization included 120,000 whole-time men and women and 200,000 part-timers. They grappled with the notorious "Baedeker" raids, the blitz of 1944, and with the horrible results of the flying bombs and the still worse long-distance rockets.
In 1941 the then Home Secretary, Mr. Herbert Morrison, was induced to give an undertaking that after the war the fire service would go back to local authority control. This new Bill seems to redeem that promise and also to provide further improvements. After lengthy discussions with local authorities, the Government formed the definite opinion that it would be wrong to return to the pre-war system of 1,668 fire authorities. They were convinced that larger units would make for greater efficiency, both in operational work and in administration. They therefore decided that the best course would be to make only the county councils and the county borough councils the fire service authorities, with provision for joint administration where operational requirements showed that to be necessary. Effect is given to this in Clause 4, which is the main operative clause of the Bill. But district councils and other councils are to be kept in the picture and must be consulted by the larger councils in connexion with the preparation of the regional fire service schemes, as provided for in Clause 20 and in the First Schedule. They may also appoint representatives to sit on the county fire brigades committees.
I will now draw your Lordships' attention to Clauses 2 and 12. They are intended to ensure co-operation between neighbouring fire authorities in order that any fire may be dealt with as quickly as possible by the most conveniently situated brigade, without regard to local government boundaries. No political boundaries will separate the firemen from going straight to the job if they are the nearest people to it. I consider that a very sensible provision. The effective central supervision by the Home Secretary is retained, and it is strengthened by the powers given to him to prescribe standards of efficiency, standards of training and equipment, to run training institutions—quite a good innovation—to appoint inspectors and to make the pay-

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ment of the Exchequer grant (which will reach up to twenty-five per cent.) conditional upon any fire authority fulfilling the requirements which he may have stipulated for their guidance and for the effectiveness of the service. Your Lordships may be interested to know that the total personnel in our fire services at the present time is approximately 27,500 whole-time men and 22,700 parttimers—in round figures, 50,000 in all. This compares with 130;000 whole-time men and 216,000 part-time men at the peak period, a decrease of 102,500 whole-time men and 193,000 part-time men—in round figures a decrease of nearly 300,000. We are now reaching normal peace-time strength, following these large reductions in personnel. Of course, they had to be enrolled during the war period.
With regard to the terms of employment of the men before the war, each of the 1,668 fire authorities settled separately the conditions of service for their own brigade. After nationalization, of course, the Secretary of State prescribed the rates of pay, hours of duty and other conditions for all. We cannot think of going back to the old diversities. Steps have been taken towards the establishment of permanent joint industrial council machinery for negotiating any changes in the present standardized conditions of service. The local authorities, of course, will act as employers in the place of the Home Secretary.
Now I will deal with advisory council arrangements. The Central Fire Brigades Advisory Council, which was set up under the Act of 1938, did not include representatives of the employees. Under this Bill, in Clause 30, advisory councils will be provided for both England and Wales, and also for Scotland, consisting of representatives of the fire authorities, the various ranks of their employees and of such other interests as the Home Secretary may think it desirable to be represented. A wide range of subjects will come before them for consideration, and they will also be free to tender advice on their own initiative. They are not bound by any considerations, and are quite free to recommend what they like. Pension provisions are dealt with in Clauses 27 to 29. The old complex and rather scrappy arrangements will come to an end and will be replaced by a new unified scheme. Retirement pensions will be given only after twenty-five years' ser-
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vice, and the maximum benefits will only be granted after thirty years' service. The scheme has yet to be prepared, but it will probably be analagous to that of the police pensions scheme.
I have sketched the broad outlines of the Bill. I need only add that proper transitional arrangements are provided for in Clause 13, and that the question of adequate water supplies for fire fighting is dealt with for the first time in Clauses 14 to 17, which impose a duty on fire authorities to see continuously that sufficient supplies are always available in the vicinity of buildings. That is quite a new stipulation, and should prevent the waste of precious time that has occurred all too often through the absence of sufficient water to quench a costly fire. We believe that this Bill will permanently settle on sound progressive lines the structure and organization of the important public service with which it deals. It represents a wide measure of agreement, I am pleased to say, and that is largely due to the full and frank discussions which have taken place with the representative associations of local authorities and of the officers and men of the fire service. We are very grateful for the co-operative attitude they have displayed throughout the discussions. I beg to move.
Moved, That the Bill be now read 2a(Lord Walkden.)
12.8 p.m.
THE EARL OF MUNSTER: My Lords, let me say at once that I should like to associate noble Lords on this side of the House for whom I speak with the tribute which has been paid by the noble Lord opposite to all ranks who discharged their onerous duties during the late war with such efficiency and such bravery. If proof were indeed required, it would be sufficient to draw attention to the 700 decorations and commendations which were awarded to this Service during the late war.
The noble Lord, of course, finds himself in a unique position to-day. He is in the privileged position of introducing the first Bill in this Parliament to denationalize one of the services which were nationalized. I can only hope that my noble friend will live for many years to come, and that this will be the first of a number of measures of a similar character. When I heard the noble Lord's description of the work which he was doing on

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this Bill—restoring the old and destroying the new—I could not help being reminded of a song which I used to hear in my cradle. I think the last lines went in this fashion:
"Restore the old, destroy the new, I am a good old boy."
That song might well have been dedicated and written to the noble Lord after his speech this morning. The general proposition of this Bill, of course, has our support, and it is, as the noble Lord says, to return to the local authorities the fire services which were removed from their control in 1941. It is the fulfilment of a pledge that was given by the Lord President of the Council, and renewed by Sir Donald Somervell when he was Home Secretary. It happened that I had the honour to be present at the conferences in 1945, and also to introduce the Fire Brigade Act of 1938, to which the noble Lord referred in the course of his speech. I have no doubt whatever of the advisability of returning the services to local authorities of a reasonably large size, and speaking personally, I should never have acquiesced in this arrangement if it required the setting up again of a multiplicity of small authorities as was envisaged in the Act of 1938. I therefore welcome the proposal that in future the county councils and county borough councils will become responsible for the maintenance in many cases of far larger units than in the past.
In the Act of 1938 it was laid down, I believe, that the minimum provision for a fire brigade could be classed under three headings—first, there were the congested urban areas with important risks; secondly, the smaller towns, mostly of residential property, with smaller risks; and thirdly, areas practically entirely rural in character. I am glad to see in Clause I of the Bill that a similar provision is made whereby the standard of efficiency for each of these areas can be prescribed by the Secretary of State after consultation with the Central Fire Brigade Advisory Council which he is setting up under the Bill. We have moved far since 1938 and we have had better training facilities and better fire fighting appliances, both of which have naturally added to the efficiency of the service as a whole. The consequence which we must face under this Bill, however, is that the expenditure, both in money and personnel, will be far
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higher than it was before the war. I can hardly believe that it is necessary to maintain the present strength of full-time firemen at the figure which the noble Lord mentioned. I believe I am correct in saying that before the war there were 6,600 full-time firemen, and to-day, if I understood the noble Lord correctly, there are no fewer than 27,500 full-time men. I should frankly have thought that this enormous increase, four times the size of 1938, was really using manpower somewhat lavishly at a time when we are so short of every available hand. I would like to ask the noble Lord who is to reply, whether some reduction is contemplated and when it will take effect.
I pass now to the damage which is caused every year by destruction by fire in this country, which I believe was recently estimated to amount to £12,000,000. Of course every effort must be employed, not only to put out a fire when it breaks out, but also to prevent fires from occurring at all, and for that reason I welcome the proposal in the Bill to set up training centres. I would like to ask the noble Lord how many local training centres are to be set up under the Bill. Under the Act of 1938 a training centre was set up, and it carried out research into the technical questions of fire protection under the supervision of the Department of Scientific and Industrial Research. Is it intended to employ that Government Department in future to help in the central training institution? Under Clause 25, the Secretary of State has power to appoint inspectors and assistant inspectors with the approval of the Treasury. Some years ago Parliament was very hesitant about giving a Minister complete and full power to appoint a large number of inspectors. Could the noble Lord give us some indication of the number of inspectors it is intended to appoint and the number of assistant inspectors?
At the present time these are the only observations I wish to make on the Bill. I am glad it has been introduced, and I hope it may, as the noble Lord rightly said, be a charter on which the fire services can rely. But I am still worried over the number of full-time firemen permanently employed, for the Treasury grant of 25 per cent. to local authorities is not of a very generous nature. Perhaps the noble Lord in his reply could give us some indication of how that figure was

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arrived at, and whether it was a figure accepted by the municipal authorities.
12.17 p.m.
THE MARQUESS OF READING: My Lords, the fire services in this country have for so long won, and rightly won, the admiration and affection of the whole population that they have survived even a change from the magnificent and ornamental brass helmets to the unsightly and utilitarian tin hats. Those services reached a high degree of value to the community, which was never greater than during the recent war. Noble Lords on these Benches certainly desire to associate themselves with the tributes which have been paid to the National Fire Service for the part they played during these years. It is a remarkable thing that the local pride which in many places had centred upon the local fire service in the years when they had a separate existence, should not in any way have lessened or interfered with the very great pride and admiration which the country conceived and cherished for the National Fire Service during the period of its existence.
The time has now come when, in accordance with the pledges which were given, the National Fire Service is to revert, not to the excessive number of constituent parts which made up the fire service as a whole in pre-war years, but into much larger and for that reason much more satisfactory areas, represented by the county and county borough councils. It is obviously right that the breakdown should not go below that level. It was a contributory factor, both to inefficiency and lack of economy, that so many different fire brigades existed during the pre-war years and nobody would claim that all of them attained a standard one would wish a fire brigade to achieve. I have a recollection of a fire taking place at a country house not more than fifteen years ago, when after a prolonged pause the local fire brigade arrived in a hired landau. The fire had by that time got impatient at the delay, and had very wisely gone out. Any steps which can be taken to elevate the whole standard of the fire service will obviously be for the benefit of the country at large; and I think the standard set by the new subdivision imposed by this Bill, not going lower in the scale than county and county borough areas, is all to the good.
I have a good deal of sympathy with
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the passing criticism made by the noble Earl, Lord Munster, as to the new powers of inspection which are apparently contained in the Bill. The average householder will soon be reduced to having a swing front door so as to save himself the constant wear and tear of going down to open his front door to the number of official callers who call upon him. I should like to support the noble Earl's request, that we should be given some indication of how these powers are intended to be exercised, and the scale upon which those inspectorates are to be officered. Subject to that possibly minor but also possibly major criticism, we welcome the principle of this Bill and look forward to it operating on satisfactory lines.
12.22 p.m.
THE EARL OF DONOUGHMORE: My Lords, I do not rise of course, to oppose this Bill, but I cannot help saying that I do not think I have ever taken part in the proceedings of any Bill in the forty years during which I have been a member of your Lordships' House with greater regret than I do on this one. After all, we are proceeding to the execution of the National Fire Service, which has, I think, earned all the praise which has been given to it this morning but which, unfortunately—no doubt, for good reasons—is to be scrapped and wiped out. I may be told that as a Londoner I have no grievance. The London Fire Service has always led the world. If I may, I would like to give an example of that. Just fifty years ago I was in Melbourne, staying with friends, and I remember being told: "Whatever you do before you leave Melbourne, you must see the fire brigade. It is the finest thing you have ever seen." I spent a very happy afternoon with them, and even with my young and inexperienced eye I could see what a wonderful service it was. Why was that? It was because its senior officer and second-in-command had both been trained in London. No doubt there are hundreds of examples of that kind.
The London Fire Brigade has always led the world. I think that was largely proved by the fact that when the National Fire Service was started a number of senior officers were sent from London to take their place in the provinces and in Scotland, Obviously that was necessary. I cannot go so far as the noble Lord,

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Lord Walkden, in regard to the results of the Act of 1938 in some parts of the country. I cannot get the impression out of my head—I have had it for some years—that if the fire services all over England, Scotland and Wales, had been as efficient as they are in London, the damage done by the Germans would have been much less than it unfortunately was.
The noble Marquess, Lord Reading, has made clear that we are not going back to 1,600 authorities; I believe we are going back to about 400. I do not think the noble Lord, Lord Walkden, mentioned that, but it is a figure that has got into my head, although not on any authority. We are going back to a much smaller number. What I am delighted to see in the Bill, above all, is the power which the Secretary of State has retained to himself. First of all, no officer commanding will be appointed in any fire brigade without his approval. I think that is a very valuable retention of central power. He will have the inspectors, referred to by the noble Earl, Lord Munster, and he will be concerned with training and with pensions. I do hope that those powers will be fully exercised by the Home Secretary; indeed, I have no doubt they will.
There is one matter on which I would like a little more information. There is a word that does not appear in this Bill at all, and that is the word "firewoman." What is the intention of the Government as regards the employment of firewomen? The noble Lord, Lord Walkden, gave us some figures, but they were for the whole fire service, and I do not know if they included women or not. I am told there are still about 2,000 women in active service in the fire brigade, of whom 700 are actually operational. Those who watch these matters with interest will remember that quite recently there was a fire in Mitcham which was put out by the women before the men arrived. That shows that they are not merely passengers in the service, and not only decorative. They are decorative, it is true, but not solely decorative. I have never been a woman's rights man; I have rather been a man's rights man. But in this particular case, I have no doubt the women have enormously justified themselves, and people have told me that there are some things the women can do better than the men. For instance, as wireless operators I am
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told that for some reason they are more efficient.
The Home Secretary's attitude seems to be that he hopes some of the local authorities will retain the women in their service. I do not think that is a very satisfactory attitude of mind. I am only comforted a little by the knowledge of the fact that all the new authorities have to produce a scheme and submit it to the Home Secretary. I hope the Home Secretary will never approve a scheme which leaves women out of the service, and prevents them from doing jobs which they are most suited to do. Surely, in these days when we are short of manpower, it is unwise not to continue to employ women, and more particularly in this case where they have proved their efficiency. As my noble friend said, the number of decorations for bravery won by members of the National Fire Service has been very considerable, and amongst those decorated have been some splendid women, who have done good work which has been commended by the governing authorities.
There is only one other small point I would like to make. Again, I am not a woman's rights man, but when we come to the question of pensions, if, for instance, a wireless operator goes out to a fire and a wall falls on her, she ought to get the same compensation as a man gets. That is not clear in the Bill, and has not been made clear in any of the discussions which have taken place. I thought I must raise that point. I hope it is in the minds of the Government more strongly than I had reason to believe hitherto, because I think that in continuing this service, which has been proved efficient, the Government will be doing a great deal to ensure the continuance of the efficiency of the new fire service on the same lines as the N.F.S., to whcih we are all so sorry to say "Good-bye."
12.30 p.m.
LORD SALTOUN: My Lords, without disassociating myself from anything that has been said by my noble friends on this side of the House, I would like to make a plea for common sense in one matter in regard to this Bill. The whole area of Scotland north of the Grampians will be very severely dealt with by this Bill, and for no purpose. I have to remind your Lordships that that area is very largely one-roaded—by which I mean that there are no alternative routes from one

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place to another, and therefore it is not susceptible of any high degree of organization. I should like also to point out to your Lordships that in the whole of that area, with the exception of a few mansion houses and outside the few burghs that exist, the vast majority of the houses are of one storey and the remainder are low two-storey houses. If your house catches fire, it is the simplest thing in the world either to put out the fire or to walk out of the house.
I should imagine that if you were to take the deaths in Argyll, Inverness, Ross-shire, Caithness and Sutherland and the islands over the last fifty years, you would find that by far the greatest number of deaths by fires within that area were deaths of farm servants who had insisted on going into the stables to try to save their horses. I have had knowledge of a good deal of that kind of service and, at the risk of delaying your Lordships further by one sentence, I would like here to put on record my intense admiration for the character and spirit of the numerous men who have undertaken the duty and the few who have lost their lives in carrying it out.
In the 1938 Act those areas were excluded from the Bill, and very rightly. If I may take the County of Inverness as an example, at the present moment there is a fire service in Inverness, there is one in Fort William, there is one at Grantown-on-Spey and a small one at Kingussie. I think that of those, Grantown and possibly Inverness are the only burghs which have three main roads leading out of them, but those have proved amply sufficient in the past for all the duties that they were called upon to perform. The organization is very complete and it does not seem to me that there is any justification for the inclusion of these counties in the Bill. They themselves would very much prefer to be left out. I am told that the expense that will be laid on the County of Inverness under the provisions of this Bill amounts to £35,000 and one authority says that that amounts to a rate of 6d. in the pound, and another authority tells me 8d. in the pound, to be applied to the whole area of the County of Inverness, and, I presume, also the islands which belong to it. That is a very heavy tax on a very poor county for a service from which they can obtain no possible
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benefit. It is quite clear that this reorganized fire service cannot bring any benefit to the islands, to commence with, and, in point of fact, in by far the greater area of Inverness, if a fire takes place and you cannot deal with it locally, you have very small chances of dealing with it through any National Fire Service. I wish that my noble and gallant kinsman, Lord Lovat, was here today, because he is very warm on this subject and very well informed on it in common with all of his friends in the area and he could put it very much better than I can.
Of course, those areas would like to be out altogether, and I think the whole of Scotland north of the Grampians would like to be out of the Bill altogether, but I do suggest to the Government that they might give the Secretary of State power to exclude these areas if he wished to do so. I think that would be a very wise and statesmanlike thing to do, because, if you consider what the Bill provides for—first of all, for fire service arrangements for mutual assistance—what effective and useful arrangements for mutual assistance can you make in an area such as I have described? It provides for many other things and a great system of organization which has to be set up, and it is not a sufficient answer, I submit, if the Government tell me that they have power to apply varying standards of efficiency to the service, because that is not the point. The point is that, if you have these fire services, you have got to have all sorts of people, such as inspectors, and these people have to be paid. There is no possible service, as far as I can see, that they can give to the community in an area of that kind, but, if they have to be paid by the community, they would be very much better employed in doing some really useful work. These people having been paid by the community, the Government which has forced this establishment on these communities is going to come along with an extravagant gesture of generosity and reimburse them to the amount of one quarter of what they have spent for something which can be of no possible service to them. I am quite convinced that, if the Government would be willing to leave it to the common sense of the Secretary of State, these areas for which I am speaking will get what they want. I very much hope that when the Bill comes to be discussed in Committee

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we shall be agreed on a Amendment somewhat of that kind.
12.37 p.m.
LORD FARINGDON: My Lords, I hope the noble Lord who has just spoken will excuse me if I do not follow him altogether. I must confess to a complete ignorance of the conditions in Scotland with which he dealt. The only point I have to make may seem a very frivolous one in comparison with those already mentioned to your Lordships. There is in Scotland—and perhaps your Lordships will either agree with me or contradict me—a dislike of the word "firemaster" for what in England we call "chief officer". I do not know if the noble Lord knows anything about that, but the Scottish officers would like to use the same title as the English officers, that is to say, "chief officer" and "deputy chief officer" instead of "firemaster" and "deputy firemaster". Personally, I find the Scottish phrase picturesque and agreeable, but they dislike it.
LORD SALTOUN: I am afraid I do not know anything about that, but I call people by the name with which they are most pleased.
LORD FARINGDON: I really share the feelings of the noble Earl, Lord Donoughmore. I cannot really greet this Bill with any great enthusiasm. I thought perhaps that some of the tributes which were paid to it were slightly inconsistent in themselves. For example, the Earl of Munster said that he himself would have been strongly and resolutely opposed to any return of the fire services of this country to the very small authorities who managed or mismanaged them before the war. I agree with him of course naturally, and the only thing that I find difficult to explain is exactly why, in those circumstances, the noble Earl, like other noble Lords, should be satisfied with the present arrangement.
I know the argument, I think, as the noble Marquess, Lord Reading, put it—in fact several noble Lords mentioned or implied it—that it is desirable, and the service itself does feel that it is desirable, that it should have close contact with and roots in the localities. The only thing that seems to me curious about that is that, when it was the function of the very small local authority to recruit, to organize, and
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to finance the fire brigade, then clearly its roots were there in the village or small town to which it belonged. When you come to the county council, that, it seems to me, makes a village very considerably more remote, and I am not at all certain that you are in fact going to get the resultant intimacy which is desired by the arrangements under this Bill any more than you would if you got it by a continuation of the national organization of the fire service. I am sure that this is the main argument which has influenced His Majesty's Government, but it is not, I know, the argument which has earned the acquiescence if not the actual enthusiasm of the Service itself for this Bill.
The disadvantages must be clear. It is obviously easier to organize an efficient service if it covers very wide areas. Similarly it is also clear that you are more likely to recruit a really intelligent type of man in a large service which offers numbers of really interesting responsible commands than you are in a service where there is perhaps a general staff in the Home Office, and below that nothing above what might be called regimental level. I am sure your Lordships will appreciate that. Moreover, promotion is complicated where the service is not co-ordinated, and where the man who desires promotion has to apply to an entirely different authority and be interviewed and all the rest of it. May I say how very much I welcome the powers of the Minister, particularly in respect of controlling the appointment of chief officers?
I welcome very much indeed the clause which authorizes the combination of authorities. I also welcome the power given to the Minister to impose combinations of authorities where it seems to him desirable. I welcome this clause because I have myself a close experience of certain localities where it seems to me that without combination or at any rate without the very closest relations between county and county boroughs the fire service can only with great difficulty be really efficient. It is a common case, and certainly well known to me, that county councils will very frequently have nothing but part-time brigades in their areas which therefore must ask for full-time cover from the county borough which is constituted in or adjacent to that county.
The noble Earl, Lord Munster, and the noble Marquess, Lord Reading, referred

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to the question of personnel. The answer is that frankly the service before the war was grossly and dangerously under-staffed. The very large increase in the cost of the services which is alarming some local authorities arises from the reasons I am going to put forward for increase of personnel and also because the wages were formerly so low that the local authorities may have been said to have been exploiting their services before the war, not only in that they paid them very inadequately but also in the long hours which they then expected them to spend on duty. In a county borough of my own knowledge before the war there were nine full-time personnel and now there are twentyseven. There has been a very large increase in their pay and also in their numbers, but I do not think this can be considered unreasonable when one realizes that in that particular county borough there are on an average 400 fire calls in a year. That is rather more than one a day, but since fires cannot be relied upon to come in due order and at such times as the fire brigade is at home, your Lordships will understand that in fact there may be several fires continuously or even at the same time. Therefore, in a borough of this kind there can be no doubt that its pre-war establishment was grossly inadequate. This is a small example of the real reason behind increased numbers.
This county borough I am speaking of, and it is a common case, stands in the middle of a county that has nothing but part-time service. Clearly it will not be easy. The Bill makes provision, and I hope it will work, for cross-boundary calls, but it will not be so easy to obtain the assistance of this full-time brigade as it would be if they were all on one footing. However, if the provisions work that difficulty will be met. But, in fact, that particular county borough should have a brigade adequate to cover not only its own needs, but the needs of the surrounding country. You cannot expect that county borough will itself be prepared to go to very considerable expense to keep a brigade in excess of its own needs. Whilst it will, of course, be open to county councils to subsidize their own neighbouring council, I am not at all certain how willing county councils whose constitutent bodies in the past showed themselves far from generous in their provision of fire services, will be at the present time. This
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is a typical case where, in my view, the powers of combination would be invaluable, and I hope they will be exercised with or without the consent of she authorities.
I hope that this Bill—though, as your Lordships will have gathered, I am not its most enthusiastic supporter—will come into operation on the, appointed day. There is very considerable unsettlement and anxiety in the National Fire Service at the present time, which I am sure your Lordships will understand, on account of the uncertainty of their position. The Service, of course, is naturally very anxious about pay and conditions, and in this respect I think the Bill is to be commended. I trust that one of the duties, of the inspectorate will be that of inspecting conditions. I do not share the alarm of the noble Earl, Lord Munster, and the noble Marquess Lord Reading, as to the establishment of an inspectorate. I did not quite follow the noble Marquess's remarks about having a special bell on one's door for inspectors, because I gather that these inspectors are very unlikely to appear on any of our doorsteps. They are likely to go to fire brigades and see that they maintain the standard for which the Central Exchequer will be paying. On the other hand, I would recommend that, if possible, your Lordships arrange for a visit, for your own security and fire prevention. It is an extremely illuminating experience to go round your own premises and have a professional eye cast on your "war risks." Were this inspectorate made available for the private householder, it would be a service for which I, personally, would be most grateful.
The professional officers of the service are somewhat disturbed at the present time about the future conditions of employment. It may be necessary for some of them to revert to their previous rank. Owing to the decrease in the size of the service, that is inevitable; but they are not quite happy about the provisions for compensation which are put in this Bill. It would appear from Clause 13, under which the Minister may make the necessary regulations, that it is possible that this compensation will be calculated on the basis of the man's pre-war rank. I think there would be an obvious injustice were this to be done, because during seven years a man might be assumed to have

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made a certain progress in his career. To calculate his compensation on the basis of his position before the war would, it seems to me, be extremely unfair. It would not be true to say that the whole of the promotion that this man may have had has been due to the war-time condition of the Service, though perhaps some of it may have been so. Quite clearly, in those seven years any man who was any good at all would naturally have made progress, and I hope, therefore, that His Majesty's Government may perhaps be able to say something on this head.
I should like, if I may, to welcome Clause 16 which deals with water supplies. Living myself in a rural area, I am glad to have any other department which can bring pressure to bear to expedite the provision of adequate water supplies in a rural area. Of course, I suppose this does not really amount to very much, but if it is a little additional pressure so much the better.
One noble Lord—I think it was the noble Earl Lord Munster—has already spoken about the provision of training centres for the Service. I would like to join with him, and I would also, if I may, like to express regret that Clause 24, which deals with this particular thing, is only permissive. It must be quite clear, of course, that small, or even now the fairly large, local authorities will be quite unable themselves to provide the training centres necessary in a profession which has, in the last few years, made very considerable strides and is now very largely technical. I hope, too, that His Majesty's Government will continue the Officers' College. I have very little doubt that they will, but I should like an assurance on the point. I would add, in connexion with training, that I do very much hope that opportunities for study will be made available to firemen. A man who is doing a twenty-four-hour tour of duty finds it extremely difficult to attend night classes. However, nothing is more necessary at the present time than the study particularly of new industrial methods by firemen, since this has a technical result on fire fighting. If I may say so, this is not covered by the powers of inspection which are given in Clause 1. Very much more than mere inspection of conditions is required. A real study is required of the new conditions in industries. I hope, therefore, that His Majesty's Government will be able at
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future date to look into this—I do not ask for an answer today—and that the Home Office will bring pressure to bear, when the new Service is set up, so that full facilities for study are made available to men, both while they are serving and, in the training schools and the colleges.
Members of the Service feel very strongly on the subject of the retiring age. The age has been fixed at fifty-five, with an extra five years in the case of senior officers. I believe that an analogy is in fact drawn between the Fire Service and the Police Service. This, the Fire Service members feel to be quite inaccurate. The duties of a senior police officer, I am told—at any rate, I speak without personal experience—are very largely, if not wholly, administrative. This is not true in the case of a chief officer in the fire brigade. He may, and indeed should, at any time not only be present at the fire, but actually go into a fire. He may have to climb about on an icy roof in winter, or go through a building which is on fire, which is a place where very very considerable activity is required, if his own life and the lives of his men are not to be endangered. It is felt, therefore, that it is desirable that a retiring age of fifty-five should be fixed not only for firemen, but also for senior officers.
There is provision in the Bill for the pensionable rights of men who have a claim for pension under their prewar terms of employment, and, where those pensionable rights are superior and better and more favourable to the men than the rates which they would enjoy under this Bill, there they may opt to maintain their original pensionable rights. There is, however, a condition attached, and the condition is that the man shall return to his own original area. Of course, the principal area which is affected by this provision is London. As your Lordships may, or may not, be aware, there are very few vacancies in London. I think in fact it would be correct to say that there are no vacancies in London, and it would be extremely unjust if a man who was entitled to the advantage of this particular provision was debarred from taking that advantage owing to the fact that he could not return to his original area, since there was no room for him. I would suggest to His Majesty's Government that they might be prepared to accept an Amendment by which per-

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haps, if a man signed a certificate or declaration that he was prepared to return, and would be prepared in the future to return, then he should be able to take advantage of this particular provision.
I have taken up rather more of your Lordships' time than I would have wished, and there are other points which I wanted to mention. One of these I cannot pass over, it is the question of the pensionable rights of war-time firemen. There are a considerable number of firemen who have elected to remain in the Fire Service but who were not in the Service before the war. There is a suggestion that their war-time service should count for pension on the payment of back contributions for that period, and I am informed that their gratuities will be sufficient to cover those payments, of which they can therefore take advantage. However, there does appear, if this is agreed, to be an inequity as between the war-time fireman and the pre-war professional fireman who has served though the war, because he will have paid his contributions out of his salary during the war and will not, of course, be drawing the gratuity. He will, therefore, have paid out of his ordinary pay—which will have been the same, of course, as the war-time fireman during the war—his pension contributions. The war-time fireman, however, will have got the whole of his salary during the war, but, at the end of the war, he will be entitled to a gratuity which will enable him to pay the arrears of contribution. Is the point clear?
There is a certain inequity in that, and whilst it is recognized that there is considerable difficulty in the payment of gratuities to professional firemen, might I suggest to His Majesty's Government, with the greatest respect, that this point could perhaps be met if war-time service were allowed to count in the ratio of two years for one? I do not know if His Majesty's Government would consider that, but it seems to me that by the adoption of such a proposal a considerable injustice might be avoided.
LORD WALKDEN: Does the noble Lord mean war-time service in the fire brigade or in the Army?
LORD FARINGDON: In the Fire Brigade. It is with regard to pensionable right that I am speaking. I hope that His Majesty's Government may be able
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to give me a few assurances on some of the points that I have raised. I am afraid that some of them may seem to your Lordships to be Committee points, but I thought that if I raised them at this stage it might perhaps save the moving of Amendments later.
1 p.m.
LORD CHORLEY: My Lords, as sometimes happens in your Lordships' House at the end of an interesting debate, we are a little pressed for time, and I hope your Lordships will forgive me if I deal perhaps a little more cursorily than I would otherwise have done with a number of relevant matters which have been raised by noble Lords who have taken part in this discussion. The noble Earl, Lord Munster, made a number of what I thought very useful points, and in doing so he asked for certain information. He could not, of course, refrain from poking a little fun at my noble friend Lord Walkden, but I think that he was well answered by the noble Earl, Lord Donoughmore, who pointed out that on the first occasion on which a national scheme is being repealed there may be a great deal to be said against the repeal.
What I think worried the noble Earl more than anything else was the question of what he referred to as the swollen numbers in the Fire Service as it exists at the present time. That point has been to a very considerable extent answered by Lord Faringdon, who pointed out that the pre-war situation could not in any way be compared with the existing situation. In a number of cases pre-war fire brigades were quite inefficient, as the Riverdale Committee made very clear in their Report, and the Act of 1938, which, as your Lordships know was passed in order to give effect to the recommendations of that Committee, had never really come into operation. So it is impossible to say that the figure of 6,000 firemen which we had before the war in any way represents what the Riverdale Committee regarded as an essential minimum force of whole-time firemen under their scheme. The firemen at that time worked the whole twenty-four hours right through—though, of course, they had a little time off. The result was that you could, in effect, man a pump with nine men.
An arrangement has been made with the local authorities, whereby a 60-hour week will be worked. Now with a 60-hour

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week it is necessary to have nearly three times as many men per pump, including the administrative staff who have to be on duty. In the circumstances, I am sure that the noble Earl will agree that it is impossible to compare the pre-war figure with the figure that is now essential. My right honourable friend is now working on the question of numbers, and I can assure the noble Earl that there is every hope that the present numbers will be reduced quite substantially. But I cannot hold out any hope that it will be possible to get back to any figure comparable with that which existed before the war. As the noble Earl well realizes, under the Bill these are matters for the local authorities who will take over the fire services, and they will have to be discussed with them.
The noble Earl then raised questions relating to training institutions. That matter was also referred to by the noble Lord, Lord Faringdon. The Fire Service College which was established, and which did most valuable work during the war, will, of course, be continued. Power is taken under the Bill to set up other training institutions, but the main job of training firemen will be for the local authorities, and the main training institutions, obviously, will be set up by them. At the moment, my right honourable friend has not in mind the setting up of any further Home Office training establishments. But this power has been taken because it may appear in future necessary to set up some further central training establishments in other parts of the country. The noble Earl remarked on the necessity of maintaining close contact between the fire services and the Department of Scientific and Industrial Research. I am glad to be able to assure him that the very closest contact does, in fact exist, and the Department is represented on the technical committees which are at the present time working on these matters. That close contact will certainly be maintained in the future.
With regard to the matter of inspectors which seemed to worry not only the noble Earl but also the noble Marquess, Lord Reading, I may say that there is no intention to have a vast swollen inspectorate. Of course, this again is a question which will have to be discussed with the local authorities. At the moment, no figure has been arrived at. I can, how-
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ever, assure the noble Earl that it will not be more than just into two figures or something of that kind. He will realize that the county councils are new authorities as fire authorities. They have no experience of running fire brigades, and they will clearly require assistance and advice over a number of years while they are, so to speak, getting into their stride. So it may be the case that during the first two years a rather larger number of inspectors and assistant inspectors will be necessary than in the final establishment.
THE EARL OF MUNSTER: I do not wish to delay the proceedings, but may I just interrupt here to say that I am horrified at the suggestion that the number of inspectors may run into double figures. Will the noble Lord, between now and the next stage of this Bill, look at the measure which was passed in 1945 for setting up two further inspectors of constabulary? The number of police in this country will probably be double the number of firemen, and it seems that nothing like so many inspectors are thought to be necessary now or are contemplated for the police force.
LORD CHORLEY: It is quite impossible to make any comparison between the fire service and the police in this respect. The Fire Service has a large number of technical sides to it—that dealing with fire-fighting appliances, for instance, is one—and all those sides require men with very specialized knowledge in the inspectorate. At headquarters a number of men engaged on technical work will have the rank of inspector. I cannot hold out any hope that it will be possible to reduce the number of inspectors to the same sort of numbers as have been found sufficient in connexion with the constabulary. I think that I have now dealt with the main points which were raised by the noble Earl, Lord Munster.
A point which the noble Earl, Lord Donoughmore, emphasized was that of the reduction in the number of authorities. He thought that the number would come down to 400. I am informed that in round figures the number of authorities under the Bill will be about 150, and I hope that the noble Earl will agree that that is a much more satisfactory figure than 400. He also spoke of the position of firewomen. That will be a

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matter for the local authorities to consider, but I entirely join with him in the tribute which he has paid to the admirable service done by these women, particularly in the controls, which is very difficult and wearying work. There can be no question that firewomen will continue to play an important part in the organization of the local fire brigades, but I am not in any way able to commit local authorities to the attitude they may adopt on these matters.
The noble Lord, Lord Saltoun, raised, as one would expect, a matter which is obviously of considerable importance in connexion with large areas north of the Grampians and I listened with great interest to what he said. I can assure him that I will bring his very pertinent observations to the attention of my right honourable friend. I am unable to give him any further assurance at this stage. The noble Lord, Lord Faringdon, raised a number of interesting and valuable points, but as he described them they are perhaps more Committee stage points than Second Reading points. I have taken note of what he said and I assure him they will all be considered.
In asking for the Second Reading I would like to thank your Lordships for the tributes which have been paid to the National Fire Service during the war; and to those tributes I would add my own, as one who had a close association with that service over three happy and eventful years. The work of that service certainly stands out in a war which was full of remarkable service, not only of the whole-time men referred to so often, but also of the tens of thousands of part-time men who often, after seventy hours a week in field and factory, went out to train or to deal with fires in a magnificent way. I am sure that all members of the National Fire Service will be grateful for the tributes paid to their work in your Lordships' House. I ask your Lordships to give this Bill a Second Reading.
THE EARL OF PERTH: My Lords, before the Second Reading is given, will the noble Lord deal with one question? With the large increase in the number of inspectors it appears that there is going to be another survey, and we already are having a housing survey. This is a point which is giving us some anxiety.
LORD CHORLEY: On a rather cursory glance I do not see that any very large increase in the number of inspectors should be entailed under that clause. I think it would be rather rash for me to give any assurance on that point, but I will look into it further, and if there is anything in it I will communicate with him.
On Question, Bill read 2a, and committed to a Committee of the Whole House.
[The sitting was suspended at fourteen minutes past one o'clock, and resumed at half past two, The LORD CHANCELLOR on the Woolsack.]

ORIENTAL AND CULTURAL STUDIES.
LORD HAILEY LORD HAILEY rose to ask what steps the Government are taking to implement the recommendations of the Inter-departmental Commission of Inquiry on Oriental, Slavonic, East European and African Studies; and to move for Papers. The noble Lord said: My Lords, your time is so severely rationed to-day with matters of very urgent importance that I would have hesitated to bring forward this Motion, and to press the Government for an answer to it, if I had not been so convinced both of its importance and its urgency. I will give, as briefly as possible, the reasons why I have brought the Motion forward. In 1944 Mr. Eden as the result of a protest made from a number of different quarters, appointed an Inter-departmental Commission to survey the facilities offered by universities and other educational institutions in this country in the wide range of Oriental and cultural studies in the countries to which my Motion refers. The Commission sat under the Chairmanship of the noble Earl, Lord Scarbrough. I know that all who are interested in this subject will feel a deep debt of gratitude to the noble Earl for the comprehensive nature of his labours, and for the importance and the value of the Report which he and his colleagues issued. It was concluded in 1946, but there was some delay in giving it to the public. It was not given out until the early spring of this year. Meanwhile, in May, 1947, Mr. McNeil informed another place that the Government approved its recommendations in principle; that they were prepared to make financial grants; and that machinery was

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being prepared to enable the Government Departments and the universities concerned to give effect to the Commission's recommendations.
My object is to obtain from the Government some definite information, both as to the nature of the provision they are prepared to make, and the machinery which they are setting up. Perhaps it might seem to your Lordships that, in all the circumstances, and in view of Mr. McNeil's reply, this Motion savours somewhat of impatience. But I think it is justified by our previous experience of the treatment given in the past by different Governments to recommendations made by responsible bodies for the support of these studies. I will take as an illustration the position regarding Oriental studies, for it is those in which I am personally most interested. I know that the noble Lord who will reply has a wider field to cover, but it will suit my purpose, and I hope save your Lordships' time, if I refer only to the position in regard to Oriental studies.
As far back as 1908 a Treasury Committee, presided over by the noble Lord, Lord Reay, remarked that it was a startling and disquieting fact that so meagre a provision was made in this country for the study of Oriental languages and culture—a provision, indeed, which compared very unfavourably with that existing in France, Germany, and Russia. It recommended that a School of Oriental Studies should be established in London. A year after that, the noble Lord, Lord Morley, stated in this House that he had every sympathy with this recommendation. But it was not until 1916 that the School of Oriental Studies received its Charter, and perhaps it would have been further delayed but for the active interest shown in the scheme by the noble Lords, Lord Cromer and Lord Curzon, who approached the City of London and obtained a considerable sum from the City of London as an endowment. In 1918 the Leathes Committee on Modern Languages made their Report to the Treasury. It recommended that the Government should give their liberal support to Oriental studies, and added that £100,000 or £200,000 a year would not be an excessive estimate of expenditure which, if wisely applied, would return a far greater national profit. But, so far as I have been
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able to ascertain, the Government paid little or no attention, and certainly gave no practical effect to this recommendation. In 1938, just before the recent war, an Inter-departmental Committee, presided over by the noble Marquess, Lord Zetland, sought to obtain an increased support from the Government for Oriental studies. That was equally without effect, for the Chancellor of the Exchequer of that day stated that the Treasury were unable to consider the needs of the Oriental School apart from the general financial position.
So I feel that it would not be entirely unreasonable if one were to ask for a definite assurance that the Government will now take early and effective steps to implement the recommendations made by the Scarbrough Commission. I do not, in what I have said, desire to give the impression that the wide range of studies with which the Commission dealt has been entirely neglected during the period to which I have referred. The London University, perhaps, stands by itself in the interest it has taken in the subject. The London University has benefited by grants received from the University Grants Committee. It is largely owing to the support given by the London University that the Oriental School has been able to expand its activities. It is now the School of Oriental and African Studies. It has over 1,000 students; and it proved of the very greatest assistance to the nation during the war.
The Army authorities had, I think perhaps a little obstinately, refused to admit the need for the extension of the study of the languages of the Far East, including Japanese, but after Pearl Harbour they made an insistent demand on the Oriental School, which was satisfied by the improvization of intensive courses in Japanese, from which numbers of officers and men benefited. Although we have that provision for Oriental studies, it is noticeable that the Scarbrough Commission had to point out that in 1939—the latest date before the war—France, Germany, Italy, the Netherlands, the Soviet Union, and the United States of America each had a number of teaching posts in Oriental studies larger than in our own universities. That was a sufficiently impressive, and at the same time, I think, sufficiently damaging list.
In African studies we now hold a reasonably good position in relation to

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other countries, mainly owing, I think, to the assistance given by some of the Colonial Governments themselves, and to a number of private benefactions. At the same time the matter cannot, and should not, rest merely on a comparison with the facilities offered by other countries. It would be ridiculous if we, with our long connexion, and our many interests in Asia and Africa, were to measure the need for the pursuit of Oriental or African studies by reference to the facilities provided in Italy, Germany, or the United States. That is so obvious that it hardly needs restating. But there is more than that. The Scarbrough Commission have shown that the facilities provided in the United Kingdom are haphazard and unco-ordinated. The provision made for these studies relates to no particular objective. They have, so far, no definite place in the scheme of higher education in this country. They have depended largely on the initiative or support of a relatively small part of our academic institutions. That is a position which can only be remedied by the stimulation of Government Grants.
Let me add this. The contribution made by the Scarbrough Report does not end there. Its real value lies in its demonstration that the whole matter must now be viewed from an entirely different angle. Hitherto, it might perhaps have been viewed as the need for satisfying certain administrative requirements or, indeed, certain academic interests. But that is not the case to-day. I cannot state this aspect of the case more forcibly than by quoting the words used in the Report of the Scarbrough Commission, referring to the changes which are taking place in our political and communal relations with the wide range of countries in the East. They point to the rising tide of nationalism among those peoples, and they go on as follows:
"Changes such as these loosen the political ties and alter the commercial ties on which for long our relations with these countries have been based. We may lose all intimate contact with the peoples of Asia unless, as we release political control, we make a conscious and imaginative effort to build a new relationship on the foundation of mutual interest in our respective ways of life and thought, and in our cultural achievements."
They add, in particular, these significant words:
"A knowledge of languages and of the people amongst whom they work is to-day a
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more indispensable part of the equipment of those engaged in overseas trade than ever before."
Those are their words, and I can put them in a way which has, I know, appealed to other nations: Contacts suitably made will in time produce contracts. In short, the matter can be no longer viewed on the narrower basis with which it was regarded in the past. To-day, these studies have become, as the Scarbrough Commission have amply shown, a matter of essential national interest, if we are to find a new basis for the maintenance of our political relations and our commercial ties with the peoples of the East.
I am sure that it is in recognition of these facts that the Government have stated that they have accepted the recommendations of the Commission in principle. But the matter is also one of great urgency. There is a heavy time lag from the past, and the training of the teachers necessary for the institution of these various courses will be a prolonged process. It is indeed this sense of urgency which has prompted me to ask the Government for the information as to the measures they propose to take in order to implement the recommendations of the Commission. They involve a cost which may amount to some £300,000 a year at the end of five years. But expenditure of this nature is imperative and, indeed, it will be light in comparison with the need which these measures will satisfy.
There is one further matter I ask your Lordships' leave to bring within the scope of this Motion. The Commission, in a very interesting chapter, refers to the need for establishing an Oriental centre in London. From their point of view, it will be a focal point for the study of the arts and cultures of Asia. As they truly say, there is nothing which would contribute more effectively to promote a public interest in Oriental studies among our own people and nothing which would be more highly appreciated by the peoples of those countries. Some three years ago a Committee appointed by Mr. Amery met under the chairmanship of the noble Lord, Lord Zetland, to deal specifically with this project. Its Report has been completed, but not yet been made public. Now that the scheme has been approved by the Scarbrough Commission, I hope that the Zetland Committee's Report will be published, and I would ask the noble

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Lord who is going to reply for an assurance that this will be done. I beg to move for Papers.
2.45 p.m.
LORD HARLECH: My Lords, the duty has fallen upon me, as Chairman of the governing body of the London School of Oriental Languages and Studies, to follow very inadequately the noble Lord, Lord Hailey. It is difficult to say how inadequate I feel following him, with his unrivalled knowledge of Asia as well as of Africa. I have had a good deal of experience of Africa but all too little of Asia, but as Chairman of that body I feel it my duty to say one or two things in this debate. I look back at the time when I returned from South Africa and took over at the London School of Oriental Studies. It was then filled with young men in uniform—a tremendous body of men from the Royal Air Force, the Army, and the Royal Navy—who were attending for intensive courses in Japanese, Burmese and the like. For years before the war the London School had offered and indeed urged upon the three Fighting Services the facilities given for teaching those languages, but of course they were not wanted and there were no premiums or encouragement to Staff officers to learn these languages. Then the war came, and suddenly the gap had to be filled.
It is interesting to note that a great many of those young men, although we had not the time to teach them Japanese, were taught phonetics. We taught them to listen in to instruments and to be able to write down what they heard phonetically, and spell it in their own way. They were then able to go out to Burma and write down what they heard over the Japanese wireless. Then the few Japanese interpreters—all too few—were able to translate what was written down. It is lamentable that it is not part of the General Staff's arrangements in this country that a sufficient supply of officers is always available who know the main languages of the principal countries of the world. That does not mean merely French and German, because it is obvious now that it is all-important that we should have a corps of people in every Fighting Service who can speak and understand Russian properly. It is equally clear that we ought to include every main Asiatic
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languages. It is in that way that the assistance of the Government is most vitally needed.
The noble Lord, Lord Hailey, said that this is not only a matter of languages, but a matter of cultures. Of course, especially in India we are still labouring under the famous tradition of Lord Macaulay. Lord Macaulay, the first education member of the Governor General's Council, laid it down that there was nothing of any value in the literature or culture of India, and that the one contribution we could give to them was English law, English history and English politics—and particularly his politics. Those politics said that every Whig was good, every Whig was always right in his actions, and every Tory was evil and always wrong. Lord Macaulay carried that out faithfully in brilliant fashion to his grave. It was for Oriental and other foreign people to learn English and English conceptions, and it was never for the English to learn the indigenous cultures and languages of these other countries.
Now there are, of course, exceptions. The Foreign Office has always had certain Consular Services. The Chinese Consular Service, and the South-East Asia Consular Service, have insisted upon the adequate training of small cadres for those services in the languages and cultures of those countries; and that is all-important. In commerce I regret to say that all too much the Macaulay tradition has prevailed. A sort of pidgin language has been taken up; a sort of course for one or more of these languages; but really to get to understand the thoughts and language of these people whose lives you are going to serve, it is necessary to study the major corpus of a language, and such study has been very rare in commerce. There are notable exceptions, of course, and to-day one of the main supports of our school in London is the Anglo-Iranian Oil Company. Most of the young people going out to the oil fields do come to us to learn Persian. We have tribute after tribute from the men themselves and from the company as to the value of their knowledge of Persian before they went out and being able immediately to establish contacts.
Looking to the future, of course, there is the whole relationship of this country with India, whether it remains within the Commonwealth or goes outside, and similarly with Burma. Who can tell? The whole thing depends upon there being a

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new relation in commerce, diplomacy and the like. There is no getting away from the fact that nationalism is inseparably bound up with language, with culture and with pride in culture, and, in the future, unless we make rather more effort in this country than has been made in the past to help anyone who is going to work in any capacity in India or any part of Asia to learn the languages and the history and the culture and the whole atmosphere of the people among whom he will work, we are not going to do well. It is a major British interest to-day to encourage the learning of these languages and the making of these studies. For Africa, too, that has recently been added to the functions of the School in London, very largely due to the efforts of Lord Hailey, a great Indian administrator, in the survey of Africa.
I have had a good deal of first-hand experience. What is the one thing that one knows? It is that the success of the British Colonial service for very good picked men and the extraordinary high standard of our men going into that service, and who have been going in for the last two years, is their ability to establish real contact with the peoples among whom they serve. It really is impossible to do that through native interpreters. It is absolutely essential, if you are to understand the working of an African's mind and the way he thinks, to understand the basis of his language, which is, of course, quite a different basis from ours. Linguistic studies and a knowledge of the Bantu language with adaptations, will carry you almost all over the whole Bantu area group of languages in Africa. It is really vital that importance should be attached to that by the Colonial Office and by the Dominions Office in respect of these territories, and by the Foreign Office in respect of the Sudan and the like. In this matter, of course, one realizes that one is dealing with a whole host of Government Departments. I have had to knock about Whitehall in various Ministries for a very long time, and again—I think I have said it before—if you have one Government Department to deal with, you can go on hammering at that Government Department and you may get something. But here you have the three Fighting Services, the Colonial Office, the Dominions Office and the Foreign Office, and the Board of Education also come in.
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Then take the question of the India Museum recommended and the centre of oriental cultures. Most interesting objects of art and culture from India are scattered about London and the provinces in very odd sorts of places, little known to the people, the largest group being the Indian section of the Victoria and Albert Museum, but that is not in the Victoria and Albert Museum. It is outhoused, very badly out-housed, shockingly housed, behind the Imperial Institute, as a sort of annexe. It is really lamentable. And you have instances of individual objects—Indian monuments which have come to this country by some means or other in the haphazard way that archaeologists have collected things—where one piece is in the British Museum and the other piece in South Kensington. It is extraordinary that, with the great long connexion between this country and India, we have never had the pride or interest to have an effective Indian Art and Culture Institution in this country. Taking the whole range of these things, compare the Anthropological Section of the British Museum at Bloomsbury with that marvellous institution they had in Berlin, and the Belgian Museum in the park just outside Brussels of all the African races and Africa—not only the Belgian Congo but everything else. That is the kind of thing which we have neglected in this country and our neglect has had its political effects.
As to the Scarbrough Report. The noble Earl, Lord Scarbrough, and his colleagues have really blazed a new trail. We do hope that the many various Government Departments who now have to be consulted and the many various Government Departments who have now to co-operate, will realize, in the light of the experience of both wars, of events between the wars and of all the political developments that are going on throughout the world, that we cannot afford any longer to starve and neglect the study of languages of Eastern Europe, of the whole of Asia, and of the whole of Africa. We realize that the Middle East, the various Arabic-speaking countries, are going to be vitally changed, probably, and it is all-important that it should not be entirely the French and the Americans, who have studied that part of the world far more than we have, who alone should carry on with these studies, but that we should play our part. It is an extraordinary feature of the whole set-up in our

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research studies that it has been left to a few keen individuals to get support by hook or by crook, by the private enterprise of an individual founder, for the pursuit of these studies.
True, the old universities still have professors of Sanskrit; all honour to them; but that is the old-fashioned classical language of India. What is needed today is to teach men the vernaculars of India. Similarly in China the old mandarin is fast being superseded and in that country, since Sun Yat Sen, the evolution that has taken place has resulted in the disappearance of many Chinese dialects and the gradual emergence of a new and modernised form of Chinese. It is vital that that should be taught somewhere in Britain. We have the school at London University, and I hope the Government will do what they can to support it and help us. I hope, too, that they will say quite categorically what, if any, of the Scarbrough Report recommendations they do or do not accept. We are most anxious to know exactly where we stand and whether we can go ahead and plan ahead so as to get the teachers and the scholars and start business.
3.2 p.m.
LORD SEMPILL: My Lords, before the noble Lord replies, may I rise for a few minutes to say how warmly I support the Motion submitted by the noble Lord, Lord Hailey, and so warmly recommended by the noble Lord, Lord Harlech? Having worked in the Far East for a number of years and been connected with affairs out East for quite a long period, I speak from practical knowledge and I know how vitally necessary it is that His Majesty's Government should take this matter in hand in a very active way. Those of us who have been engaged in commerce out there realize how developments are being prevented from being followed up in an effective way because we can never get the support of people from here with a knowledge of the languages. Those who are anxious to acquire that knowledge are finding difficulties at every turn. I therefore hope that the noble Lord who is to reply will give an indication that a new line of thought and activity will be followed in regard to this situation. Otherwise, we shall certainly continue to lose, as we have been doing, in the Far East and those countries where knowledge
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of their languages is vital to our commercial development.
3.4 p.m.
THE CHANCELLOR OF THE DUCHY OF LANCASTER (LORD PAKENHAM): My Lords, I am most grateful to the noble Lord, Lord Hailey, for ventilating this matter in such an authoritative speech and for giving me the opportunity to make another statement following that in another place on March 17, a statement on this occasion which will bring the story up to date. I am given also an opportunity of saying on behalf of the Government what a great public service we consider was rendered by the noble Earl, Lord Scarbrough, and his colleagues in preparing and presenting this memorable and far-sighted Report. I should allude also to the great work that has been done by the noble Lord, Lord Harlech, who has made another of those very eloquent and vigorous speeches with which he wakes even the dullest of us from our slumbers. I do not feel that while we have so many and such onerous burdens to bear on these Benches, we could accept responsibility for defending the Whigs! If Lord Macaulay were with us to-day I have not doubt he would put his case with a vehemence equal to that of the noble Lord, the Lord Harlech; and, having been something of a precisian, he would have picked on that small split infinitive which escaped Lord Harlech, and from which Hansard will no doubt rescue him as they rescue all of us.
On behalf of the Government I would like to endorse all the strong expressions of opinion that have been given us of the importance of studies of this kind. I will not repeat these sentiments because they have been put so effectively; but I would remind the House of the important article contributed by Lord Haney to The Times the other day when he pointed out that our relations with countries covered by the Scarbrough Report can no longer be conceived as they once were in terms of political or economic supremacy. To-day we must think in terms of independence between equals. The strengthening of such independence is the central aim of the Report, and the increasing need for the benefits of such understanding are among the most interesting in the Report itself.
I would particularly refer your Lordships to Chapter III in the Scarbrough

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Report entitled "The national importance of these studies." Perhaps I may draw your Lordships' attention to two passages on page 26, where relations with the Soviet Union are considered. If I might be forgiven for reading a very short passage from that page I would recall that the Report informs us that
"There is clear evidence of a strong desire in this country to learn more about the Soviet Union and we have been informed that a corresponding desire exists in the Soviet Union and that much attention is given in that country to the study of Great Britain and the British Empire. These tendencies, it will be agreed in every quarter, are greatly to be welcomed as a presage of a more intimate understanding between the two peoples. They add further weight to the claim that attention to Russian studies particularly in the universities is of great national importance."
We most certainly echo these sentiments and hope that the expansion in England of the studies after this Report will be quite real.
The Government accepted this Report when it was submitted last year as a principal means whereby we can put our own house in order in this respect. It will of course be a very slow business. In the words of the Report—"The condition of these studies in England is not worthy of us." To pull ourselves up to a level of general enlightenment and to build up a central core of expertise in the knowledge of remoter countries is indeed a big problem; but the Commission told us how it should be solved and the Government have heartily accepted their recommendations in principle. Responsibility for co-ordinating work on the carrying out of the Report has been placed on the suitable Committee, on which are officials drawn from each of the various Departments concerned. I entirely sympathize with the words of the noble Lord, Lord Harlech, when he described the nightmare that over-whelmed anybody who has to take on Departments one by one.
LORD HARLECH: May I ask whether the Service Departments are to be represented on that Committee?
LORD PAKENHAM: I am not equipped with the names of the members for publication to-day, but afterwards I would willingly discuss the matter with the noble Lord. I feel sure that if he is not satisfied with the representation the matter could certainly be considered again. Working in co-operation with these representatives
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there will also be a special Committee, a University Grants Committee, to act in liaison with the universities, one for the enlargement of the Oriental and African studies, and the other for the enlargement of the Slavonic and East European studies, which makes four Committees altogether, of which three will be subsidiary to and directly or indirectly report to the first Committee which represents all the Departments concerned.
Action has already been taken on other recommendations of the Report, and I hope your Lordships will bear with me while I give details, because I feel sure that there will be much interest in them, not only for those of us in your Lordships' House, but also for a wider public. Recommendation 8 (i) of the Report refers to university departments. Here the moneys available to the University Grants Committee for distribution in recurrent grants to the universities from now on, as a result of the Report, will include provision to cover expenditure by the universities on academic development on the scale that the Report recommends. That means that we shall begin, as suggested in the Report, with £125,000 in the academic year 1947–8. Recommendation 8 (ii) of the Report deals with capital expenditure. The University Grants Committee will deal with claims under the Report for grants on capital expenditure in this field as they arise. It is considered that the current year's allocation for capital grants to the universities, which is £3,500,000, will be sufficient to cover such claims. Recommendation 8 (iii) deals with travelling expenses. Proposals by the universities for expenditure under this head will be taken into account by the University Grants Committee in assessing their grants.
Recommendation 8 (iv) is concerned with post-graduate studentships, a matter of special interest, I think we shall all agree. An allocation of £10,000 has been included in the Universities and Colleges of Great Britain Vote, class 4, No. II for the current financial year. It is anticipated that this sum of £10,000 will be enough to provide studentships in the next academic year for the number of candidates who are likely to come forward. The awards will be on a scale which will take into account the recommendations of the Commission on this point. The grant of £10,000 is not a fixed one, but

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will be reconsidered annually in the light of the experience gained by the Committee, and of the number of candidates who present themselves. Recommendation 10 of the Report relates to the Exchequer grants. The new Exchequer grant for these studies will, like other Exchequer grants for these new studies, come to the universities through the machinery of the University Grants Committee, who will be advised by the two sub-committees I mentioned earlier on. That is not precisely the suggestion of the Report, but I think it will be found to serve the purpose in an effective way.
Recommendation 12 B. (iii): The Board of Trade has been invited to consider, in consultation with the Ministry of Labour and National Service, what machinery can be set up for liaison between the universities and firms with men to be trained. Recommendation 20: A working party on the lines of the steering committee recommended in the Report, and representing the Department affected, is to be set up by the Treasury and will examine the possibility of establishing an Oriental Centre in London. Recommendation 22: The proposal that tutors should be appointed to look after the interests of students from abroad is one which the Government commend to the sympathetic attention of the universities. I understand that some universities have already adopted this practice. The Ministry of Education will keep the Committee which co-ordinates this work in touch with U.N.E.S.C.O.
On the proposals of the Report that I have not mentioned, progress has not been hitherto sufficient to justify a statement. Nevertheless, there has been progress, and it is hoped that in almost every case it will be possible to do something on the lines recommended. The important thing is that a start has been made at the heart of the matter—namely, the grants for the universities. I feel sure that the noble Earl, Lord Scarbrough, would subscribe to that. As the Report stated:
"The establishment and maintenance of an academic tradition is the first and most important long-term objective, and it is only by calling into existence a body of scholars of high intellectual attainments that it will be possible to provide sound facilities for training for careers and to satisfy public interest."
There is every reason to believe that the universities will co-operate to the full with
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the two sub-committees of the University Grants Committee in developing the existing provisions for these studies. As I said earlier, money is also being provided, subject to the approval of Parliament, for post-graduate studentships on a scale which, from all the evidence we have received, should be sufficient to meet the demand in the coming academic year.
The Report of the noble Marquess, Lord Zetland, on the possibility of the setting up of an Oriental Centre in London has been mentioned in the debate. I am not yet in a position to make a statement as to whether this Report will be published, but the question is being considered very carefully and actively. I can say, however, that its recommendations will be considered by the working party, and integrated with those of the Scarbrough Report. When one is presented with a document of the breadth of vision and, I think one may fairly say, the nobility of aim of the Scarbrough Report, one is tempted to say straight out: "Let us have this functioning full blast to-morrow." But on examining closely the Report one will hardly expect progress to be made quite as rapidly as all that. I do hope that the noble Earl, Lord Scarbrough, and the noble Lord, Lord Harlech, and the noble Lords, Lord Hailey and Lord Sempill, will feel that we are really getting on with the job of giving effect to the Scarbrough Report, and I am sure that if a review of the work is undertaken as recommended by the Report, that is in ten years, there will have been a great revolution in these studies, a revolution that was long overdue. I will end by once again thanking the noble Lord, Lord Hailey, for raising this matter and paying one more tribute to the invaluable Report of the noble Earl, Lord Scarbrough.
3.18 p.m.
THE EARL OF SCARBROUGH: My Lords, I hope you will permit me to add just a word or two to this discussion. I am sure that all my colleagues who sat on this Inter-departmental Commission will learn with satisfaction and relief of the statement which has just been made by the noble Lord, Lord Pakenham. It is a satisfaction to know that our labours are not going to be wasted and that the Government are taking seriously the recommendations of the Report. There will be relief for this reason: As we worked at this problem it gradually became clear to

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all of us that this was not, as it might appear to be at first sight, a question of only academic interest and of concern only to a few specialists. It became clearer and clearer that here was something which had a great deal of national importance attached to it, and, important as it might have become in the past, it was going to be of far greater importance in the future, with conditions changing in India and in other parts of the world. It also became very clear that, for one reason or another, and in spite of several previous attempts to remedy the position, this country could rightly be accused of neglecting this matter in the past, in spite of its own very wide interest, particularly with Oriental countries.
The recommendations which the Commission put forward were an attempt to put things right, or to start putting them right. I entirely agree with the noble Lord that it would be foolish to expect very quick results. This is a long-term business, and results can only come very gradually. From what the noble Lord has said, it is clear that public money is going to be expended in greater measure on these studies. The sum is modest compared to the public money spent in many other ways, and I feel certain that, given time and continuity in this work, the real dividend will be forthcoming. There will be a dividend in the shape of greater respect among many countries for what we are doing in this matter, and a more widespread and better informed interest in other countries among the general public here—in fact, that new relationship which has been spoken of by Lord Hailey. If this does come about, it may be that it will have an important influence—I do not wish to exaggerate—on our relations with many countries, and also on our trading position. The noble Lord in his statement has covered such a wide area, and has made it so clear that His Majesty's Government accept the recommendations of the Commission, not only in principle but, already, in great detail, that it would be most ungenerous of me if I were to pick up any point in detail. I would only conclude by expressing—if I may do so with all humility—gratification that the noble Lord has been able to go as far as he has done to-day. I would further like to express my trust that if the hopes held out about the future in regard to these studies can be realized the
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time will come, in some few years, when this country will be what it should have been long ago—the real centre for these studies, particularly those which concern Oriental countries.
3.22 p.m.
LORD HAILEY: My Lords, I began by expressing my apologies for having brought this Motion forward. I realize now that no such apologies were really needed. The way in which the House has received this Motion and the manner in which the Government have responded to it have removed any sense of apprehension in my mind. Having served a Government all my life, I naturally held the lowest sort of opinion of any Government of any kind. I do not know whether Lord Pakenham will appreciate the compliment—it may be that he will not—but what he has said this afternoon, and the very generous way in which he has treated this question have made me begin to feel at least the beginnings of faith in a Government. Like the noble Earl, Lord Scarbrough, to whom we all owe so much, I hope that the steps which the Government have already taken and the earnestness which has been shown in this matter, will be a guarantee of future support, and will mean a real new charter for the study of these subjects in this country. I beg leave to withdraw my Motion.
Motion for Papers, by leave, withdrawn.

COLONIAL DEVELOPMENT.
3.24 p.m.
VISCOUNT HALL: My Lords, before we proceed to the next business on the Order Paper, I would ask leave to make an important announcement on Colonial policy which has just been made by my right honourable friend, the Secretary of State for the Colonies, in another place. The statement is as follows:
The Government consider that there is need for improved machinery for developing Colonial resources. The Colonial Development and Welfare Act provides money for the improvement of the social and other services of the Colonies and helps to provide the basic services for further economic development in the form of improved communications, better agricultural

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services, water supplies and the like. This has been, and is, very useful. But it is not enough. An instrument is also required whereby we can undertake individual productive projects likely to increase the wealth of the Colonies themselves and to stimulate the supply of products of which this country and the world at large stand in need.
The Government propose, therefore, to establish a Colonial Development Corporation with total borrowing powers of the order of £100,000,000. It will operate on commercial principles. Its object will be to establish or assist any enterprise in the Colonies which is designed to increase their general productive capacity. No doubt these enterprises will be mainly agricultural but the Corporation will be able to undertake any enterprise which serves the general object.
We propose that the Corporation should be given power to conduct enterprises itself, or to set up subsidiary organizations to run individual projects or to give assistance to existing enterprises.
The Corporation would undertake particular operations in any Colonial territory only with the consent of the Secretary of State and the Colonial Government concerned. The intention is that the Corporation and its subsidiaries should operate generally in close consultation with Colonial Governments, in order to ensure that their activities are conducted in the way best suited to promote the welfare of the Colonial peoples.
There will, of course, be no question of giving the Corporation any general monopoly in Colonial development. It is not intended to supplant private enterprise, but to supplement it. While the Government will continue its policy of encouraging public utilities and other suitable forms of public enterprise, it will also welcome private enterprise and investment in the Colonies so long as it is in harmony with the plans of Colonial Governments for social and economic development.
The Government propose to introduce legislation to establish the Colonial Development Corporation. It is proposed that the same legislation should provide for the establishment of the Corporation which is to take over
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the ground-nut project established in East Africa by the Minister of Food. This would be a separate body from the main Colonial Development Corporation and provision would be made for it to undertake enterprises similar to the ground-nut project over a wide field. The two bodies would work in the closest liaison with one another.
3.28 p.m.
VISCOUNT SWINTON: My Lords, I am sure the House will have heard with very great interest the preliminary announcement which has just been made. There can be no doubt at all that there is a tremendous opportunity in the interests of the Colonies themselves, in the interests of this country, in the interests of the British Commonwealth of Nations and, indeed, in the interests of the whole world, for the development now of the resources of the Colonial Empire. And, soundly developed, those resources are very great. On that, I am sure, we shall all be at one. I am certain too, of this; that the wise use of credit in this matter will command universal support. It is not a case of being sure of a steady 3 per cent. If money for development is used to assist a wise project, then, even if you receive no interest for a number of years and get your money back at the end, the indirect results you will have had in the way of increased production and increased mutual trade is of far more value, and produces far more revenue than the 3 per cents. which my noble friend and I who, in turn, held office as Colonial Secretary, used to have so often pressed upon us as a first consideration. They are not a first consideration. On that, too, I am sure that we shall all be at one.
Equally important it is, of course, that what is done should be done in the right way, and we shall see when the Bill comes before us, I hope, that that is so. I notice in the statement that it is not intended to supplant private enterprise but to supplement it. I am sure that is wise. We have, after all, a certain experience in this, in which my noble friend Lord Woolton and I, and others now on the opposite Bench, were closely concerned. Early in the last war the Government decided, for the primary purpose of conducting economic warfare, to set up the United Kingdom Commercial Corporation; I was asked to be Chairman and to pick the board and run the Corporation.

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It had a much wider function than merely denying materials to the enemy. As the economic war developed it became responsible for an enormous amount of trade all over the world and it did a great deal for supplying this country and Russia.
The whole of the commercial supplies and transport to Russia came to something like £120,000,000, and it was largely responsible for all the executive work of the mutual supply organization of the Middle East. I have referred to that because it was entirely financed by Government credit. We had a running credit which ran up to between £70,000,000 and £80,000,000, and I think in our peak year our turnover was over £150,000,000. Broad policy was settled between the Ministers and the Chairman. I am sure that every Minister in the last Government and every member of the board of that Corporation would agree on this, that our success was due to the fact that it was run on commercial lines. We had the best commercial board that could be collected and we had this fundamental principle—we always worked where we could through existing trade channels, and we picked the best. In that way, working through existing trade channels, we were able to keep the organization relatively small, to keep effective control over policy, and at the same time to use every resource open to us.
I feel sure that this is the intention of the Government in this. There must be a partnership. It should be a partnership between the Government, the Colonial Government, and those who are best fitted by their experience in the field to conduct these enterprises. Much work has already been done. In West Africa we had wide plans, and some of them are in process of being carried out. Let me give one example which bears out what is in the minds of the noble Lord and myself. We saw a great opportunity in using not the very best timber but the indifferent timber of Nigeria to make plywood, which means dollars; and under the wise inspiration of Sir Arthur Richards—now a Member of your Lordships' House, though he has not taken his seat—a combination of United Africa and the Government has already established a very successful private industry invaluable to the Colony and to this country. It seems to me that those are exactly the lines of the partnership on which this should work, and if
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those are the lines which are to figure in the Bill, as I believe they will be, then we shall be able not only to commend its purpose but, I trust, to commend the method.
VISCOUNT SAMUEL: My Lords, I should like to join in offering a very cordial welcome to this important and most promising proposal of the Government. I would also join with the noble Viscount who has just spoken in expressing satisfaction that it is clearly expressed in the statement made that these measures are intended not to supplant private enterprise but to supplement it. I need add nothing more except to address to the First Lord of the Admiralty one question. The Colonial Development and Welfare Acts extend to mandated territories and I should like to ask whether this Corporation will also include mandated territories.
3.36 p.m.
VISCOUNT HALL: My Lords, I am grateful for the kind way in which the statement has been received. It is an indication that interest in Colonial development and Colonial administration is not confined to one particular Party. This is not the occasion to deal fully with the development which has taken place in the Colonies during the last ten years, nor with the plans for the future. When the story is told it will be one for which those Governments responsible will not need to hang their heads. I have no doubt that the outcome of our policy for Colonial development, which is a continuation of that which has been done, can be attributed to the fact that we have a Colonial Development Council in existence, presided over by the noble Viscount, Lord Portal, who with his colleagues on the Council has done an enormous amount of excellent foundation work. And I have no doubt that the new Development Corporation will be called upon further to assist in the complete development of the Colonies.
In regard to the question of the noble Viscount, Lord Samuel, the fund of the Colonial Corporation, like the funds of the Colonial Welfare and Development Fund, will be extended to mandated territories and also to the new trust territories, those territories which will very soon come under the Trusteeship Council. They will be able to obtain full benefit both from

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the Colonial Welfare and Development Fund and the proposed Finance Corporation.

NATIONAL SERVICE BILL.
3.38 p.m.
Amendments reported (according to Order).
LORD DE L'ISLE AND DUDLEY LORD DE L'ISLE AND DUDLEY moved, after Clause 21 to insert the following new clause:
"22. Within six months of the passing of this Act the Service Authorities shall lay before Parliament a comprehensive scheme showing the manner in which persons called up for full time or part time service under this Act are to be employed in each Service."
The noble Lord said: My Lords, I rise to move the Amendment which stands in the name of Viscount Bridgeman and myself. In doing so I would like to tell the House that it is not in any way our intention to withdraw our support from the principle which underlies the National Service Bill. I think noble Lords who sit on the Government Benches will agree that we, on this side, have given them consistent support in what they have brought before the House, but in the principle of national service there is an analogy to taxation. We have agreed to give power to the Government to raise a revenue in men but we have been singularly trusting in the matter of its expenditure, or at any rate in the details of its expenditure. There is a duty laid on Parliament not only to raise the men but to investigate the way in which those men are to be trained. Parliament has a duty to the nation in this respect, and I believe the Government will find a much readier and much more willing response from all who have to take part in service, and their families, if they can lay before them the scheme in sufficient detail to make it appear a watertight and reasonable scheme. The Government should take the nation into their confidence.
I think I can fairly say that so far very little—I will not say nothing—has been said about the manner in which national service men are to be trained We know something about the Army. We know that the national service men in their part-time service are to be incorporated in the Territorial Army; and we know that it is intended that national service men shall
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do part of their training in Regular units, and possibly engage in occupational duties. I do not think that is a sufficiently detailed statement to satisfy the House. But nothing really has been said which will throw any light upon the manner in which the Navy and the Air Force are going to use their national service men.
I do not intend to traverse once again a matter which has been fully debated in both Houses—that is, the proper length of service—but I think there can be no doubt that by reducing the length of whole-time service from eighteen months to twelve months there must necessarily have been a great reorganization of the plans of the three Service Ministries. It has been said by way of apologia that there were two schemes prepared, and they took the alternative. Whether that is true or not, I do not know. If it is true, and if there is in existence a comprehensive scheme for the training of national service men for both whole-time and part-time service, then I think the House ought to know about it. If, on the other hand, the alteration in the period of whole-time service has caused the Service Ministries to recast their plans, and they are in the process of so doing, then I think it is reasonable that we should ask that there should be a new clause placed in this Bill to provide that the Government shall lay those plans before Parliament within six months of the passing of this measure. I do not think there is anything unreasonable in asking for such information. It is the duty of Parliament to ask for that information, and I would urge the Government to take the House and the country into their confidence in this matter. I beg to move.
Amendment moved—
After Clause 21 insert the said new clause.—(Lord De L'Isle and Dudley.)
3.43 p.m.
THE EARL OF CORK AND ORRERY: My Lords, this Bill has gone through almost entirely as an Army affair, very largely because, as the last speaker said, no details have been given as to how the men in the Navy are to be trained. It is most important that something on the lines of this Amendment should be inserted, in order that Parliament can keep their eye on what is going on. It is much easier for the Army. They live ashore, and members of Parliament, and others, can go round. I do not wish to

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cast any doubt upon the Sea Lords, or upon their desire to train, and I do not suggest that they will not do all possible in that direction. But they are under political control, and they may have to cut the costs. One thing that does cost money, when you come to the Navy, is sending men to sea. If you are to have a reserve of men you must have them ready to go to sea and do their job when the flag falls and war starts.
Up to the outbreak of war I was in command of a fleet, and we used to have frequent exercises. We were continually being torpedoed by submarines which got in under the screen. At that time a very prominent Minister was taken down to the School of Anti-Submarine Instruction. He was taken into the Channel, and he was shown how, with the asdics, the submarines were always picked up at once. Why was that? The reason was that they put their best asdic operators on the instruments when the Minister came down, and the submarine was located every time. The anti-submarine vessels went out, they knew there were submarines about, they knew what time luncheon was fixed for ashore, and they could almost say what would happen. That Minister later stood up in public and said that we had the measure of the submarines. As I say, when we were at sea the submarines frequently got through. Why was that? It was because the young asdic operators suddenly found themselves boxed up in a small cabin in a heavy sea, and in many cases they were very seasick and could no more attend to their instruments than fly.
From a naval point of view, I hope that we shall be told what the national service men are going to do, and how long they are to spend at sea during the one year of service. I hope that when they go to sea they will be able to carry out their functions, and will not be capsized by practical experience of what the sea can do to the inside of a man. There are so many Reserves now that it would be interesting to know how they will dovetail together. There is the Royal Fleet Reserve, the Royal Special Naval Reserve, the Royal Naval Reserve, and the Royal Naval Volunteer Reserve. They all have their different parts to play, and it will be interesting to know how they will all dovetail together. I would like to support the Amendment,
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and I do hope that the Amendment, or something of the kind, will be accepted.
THE EARL OF SELKIRK: My Lords, I would like to say a word or two in regard to this Amendment from the point of view of the Royal Air Force. I think the one danger the R.A.F. sees in this Bill is that the men will be employed purely on what are called general duties. That is what the R.A.F. want to discourage, so far as possible. They want to make it quite clear that these men will be trained in proper duties, so far as it is possible to provide for it in the Bill. For that reason, it would add a great sense of confidence and encouragement if the men realized that they were not coming in simply to be—to use a word so often used to-day—"stooges," but are coming in to be taught a real job of work. It is true that in the course of the major trades—what are called the B Class trades—it is not possible to train men properly in the period; but I know that the R.A.F. authorities are anxious that the fullest opportunity should be taken in the time to train these personnel. For that reason, I feel that a great service will be done if it is shown clearly how they are to be trained.
THE MINISTER OF CIVIL AVIATION (LORD NATHAN): My Lords, let me say, in response to what was said by the noble Lord, Lord De L'Isle and Dudley, that I fully appreciate the most helpful and co-operative spirit in which noble Lords opposite have conducted the discussions on this Bill in all its stages. We have, indeed, a common object upon which we are united. I fully realize that the noble Lord who moved this Amendment, and other noble Lords who have supported it, are solely concerned, as I am, with the interests of the Services. Let me say for the Government that we fully realize the anxiety of your Lordships, and the country generally—which we regard as natural—to receive some assurance, not only that the best use will be made of the national service men, but that it will be possible in the training time allowed to bring them to the required state of efficiency, and that they will be trained, to use the phrase of the noble Earl, Lord Selkirk, to do a real job of work.
I would earnestly suggest to the noble Lords whose names are appended to this Amendment that they might consider again whether the proposal that they

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now make is really in the interests of the Services. They have great knowledge and experience of what is involved, and I feel sure that on reconsideration they will be likely to agree that the promulgation of a comprehensive scheme of training during the next few months would, in the long run, be of no advantage to the cause which I know the noble Lords and all of us have in mind. Let me say for the Government that the Government, for their part, would not feel justified in calling upon the Service Departments at this relatively early date to commit themselves in any great detail to their training arrangements from 1949 onwards as regards the whole-time national service man, and for a period that will not begin until 1950 for the part-time national service man. Moreover, it will be realized that requirements will differ in different corps, and owing to the need of industry there may well have to be various means of tackling the problem in different parts of the country. But I must tell your Lordships' House that the general framework, and the broad principles are, of course, already determined. It is the detailed plans which are still being considered and they must, for some time, remain fluid; they must be subject to modification. Indeed, they will continue on that basis throughout, because improvements must be introduced as necessary in the light of actual experience as time goes on.
The Service Departments are determined, not necessarily to be bound by the past, but to explore thoroughly in the light of new conditions the best means of getting training value out of the limited training liability of sixty days during these six years. But I can here and now give your Lordships some general indication of the lines upon which these Departments propose to work. Naturally, the first consideration during the period of whole-time service will be given to the provision of adequate training, but in some cases—and particularly as far as the Army is concerned—it will be necessary to post a large number of national service men to the nearer overseas stations for part of their whole-time service. The training arrangements in the Army will be designed with that fact in mind.
The men in all three Services will undergo the usual period of primary or
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recruiting training, and after that they will begin to specialize. The nature and length of their individual training will vary a good deal according to the Service or branch. In the non-technical branches of the Army men will be posted to active units at an early stage, and they will complete their individual training in special sub-units engaged solely on that task. After that, they will continue with unit and collective training in the normal way during the remainder of their whole-time service. Many of the units will be overseas. In the more technical branches of all three Services, the primary training will be followed by a period of technical training which will vary according to the nature of the trade, and this will be carried out in training centres or other establishments set up for the purpose in this country. It is intended, by careful selection, during the primary training, to allocate men to those branches of the Service for which they are most suited and best qualified, so as to ensure that the highest possible standard is reached before the end of the whole-time service.
In the Army, national service men will be accepted for all types of trade, and it is anticipated that they will reach the journeyman's standard in all cases. Where this type of training takes up most of the twelve months period, the collective training will be given during the subsequent part-time service in the Territorial Army. As to the Royal Air Force, to which the noble Earl referred, national service men, unless they possess some preliminary qualifications, may not be eligible for certain of the more skilled trades, and those requirements will be covered in the main by Regulars. Special arrangements will also be required as regards air crews. The noble Earl, Lord Cork, asked about the Royal Navy. In regard to that, let me say that it is hoped that the individual training will be complete in most cases in time to enable the man to serve for a period at sea.
Training during part time service will vary considerably according to Service and Arm. In the Royal Navy it is intended, in a large number of cases, to divide the sixty days full-time training into three periods of about twenty days each, spread over the six years during which the man will be serving on the Reserve. I understand that it is hoped that about half that period will actually be spent at sea. In the Army, the pre-war

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Territorial system of periodical camps and a number of drills, plus week-end instruction, wilt be continued for the great majority of the units, but there are certain specialized units, for instance anti-aircraft units, which will do the bulk of their part-time training by means of evening or week-end instruction, which is more suitable for that particular class of work. In the Royal Air Force, the call-up for training during part-time service will be much more on an individual basis. The training itself will generally be carried out during camp periods.
I hope noble Lords will, for the time being, be satisfied with this general view of the situation which, I think I may fairly claim, indicates more than has been said on any previous occasion. The preparation of detailed plans is well advanced, but we must preserve and maintain a certain flexibility both in the interim period and during the operation of the Act. I hope noble Lords in general, and those who have particularly interested themselves in this matter, will feel that I have given them, as I wished to do, fully and frankly as much information as I am able to at this stage.
THE EARL OF SELKIRK: My Lords, may I ask the noble Lord a question before he sits down? Is it the intention that this period of training should count toward apprenticeship in the appropriate cases? I am talking about craft trade unions. This period naturally comes in the middle of the apprenticeship period, and I would like to know whether this will count towards qualification for trade union membership.
LORD NATHAN: I do not think that the apprenticeship will necessarily be interfered with, but I should not like to give a categorical answer to that technical question. I will certainly furnish the noble Earl with a reply.
VISCOUNT BRIDGEMAN: My Lords, we have some weighty matters ahead of us and therefore I do not wish to take up the time of your Lordships' House by making a long speech just now. I would like to say at the outset of my remarks how very grateful my noble friends and I are to the noble Lord opposite for the statement he has made which, as he has indicated, takes us a good deal further in this matter than hitherto. After all, no one wants to tie the Service Departments down to any detailed procedure
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which they may have to adopt in circumstances they have not foreseen. But there is a very great distinction between flexibility on the one hand and vagueness on the other. It was our opinion, until the noble Lord spoke as he did just now, that the picture was much more one of vagueness than of flexibility.
One must say that a certain amount of special pleading has been done. If we had not been over the alternatives which we have discussed so often about length of service, I have no doubt that the Service Departments would have produced a scheme in a good deal more detail than we have now, it would have been gone through by the Service Minister and by the Minister of Labour, and not until those details were thoroughly probed would the Government have brought in the Bill. If there had been no changes in the Bill, I should have been disposed to say the Service Departments were greatly to blame in that the details were not more clear and more precise than they were when the Bill was introduced. Now I should quite accept what the noble Lord has said; I would be prepared to put it that they must now make up for lost time and try to put the pieces of the scheme together and adapt it to fit the twenty-one and sixty days. We are very pleased, I think, to hear that the full-time service is apparently to be spent in actual units. It will make a great deal of difference to the Reserve service. It will make a great deal of difference to the man himself, because we all know it is very much easier to soldier properly in a properly formed unit than in a depôt, or something of that sort, and that applies to the other Services as well. I am equally sure that my noble and gallant friend the Earl of Cork opposite was pleased when he heard that the naval ratings were to go to sea.
I am not absolutely certain how good an answer we have yet had, either to-day or in previous debates, about the real impact of this national service on industry. I read again the noble Lord's remarks on the Committee stage of this Bill where we were told that everybody considered it very carefully and we were told that sixty days was the right amount and industry could not stand anything more than sixty days. If we had been told that industry could not stand more than so many days a year or that industry could not stand more than so many days

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full-time service a year, I would have understood it, but I do not understand this statement that sixty days spread over six years is a really firm figure. I should have thought—perhaps it is too late, but I put it forward for consideration—that it would be very much better to say "Industry can stand up to so many days in a year and industry can stand up to so many days of full-time service." I know that in the Home Guard we were doing part-time service and we fixed the figure at forty hours in four weeks, but that was in the middle of the war when everybody was working overtime. To say now that part-time service in the evenings is really going to affect industry does not seem to me to represent that precise and detailed planning which noble Lords opposite ask us to associate with the schemes that they put forward.
Now I have one word to say about Anti-Aircraft. I should like to say with great respect how much I agree with the proposal to spend more time in part-time training in Anti-Aircraft and less time in full-time training. That really does represent a realistic approach to the problem and no doubt that will be the start to the approach to the problem of training the technical units of the Territorial Army about which we have heard lately and about which I think we should hear more. Their importance now is so much increased compared with the pre-1939 days, because they have to carry so much more equipment. We are grateful, as I have said, to the noble Lord opposite for lifting the curtain, not very far but far enough to cause us to withdraw our Amendment. I am not saying that we shall leave the subject. Obviously it is one of the greatest interest to noble Lords on all sides of the House. We shall hope to go on watching the problem with the intention of co-operating with noble Lords opposite and with others who are concerned in the matter of seeing that the best is done for the Service Departments and therefore for the country. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.

TRANSPORT BILL.
4.5 p.m.
House again in Committee (according to Order).
[The EARL OF DROGHEDA in the Chair.]
Clause 95 [General provisions as to terms and conditions of employment of staff, etc.]:
LORD MANCROFT LORD MANCROFT moved, in subsection (1), at the end, to insert:
"Provided that nothing in this section shall enable the Commission to make it a condition of employment of any person employed by them that such person shall or shall not be a member of any particular trade union."
The noble Lord said: I rise to move the Amendment standing in the name of my noble and learned friend Viscount Simon and myself. This Amendment is designed to prevent the Commission from making it a condition of employment that a man should or should not belong to a particular trade union.
The operative word in this Amendment, of course, is the word "particular." Had that word not been inserted in the Amendment there might have been a suspicion that this Amendment was controversial; but the fact that it is there, I think, rules out that possibility, and I am sure that it is an Amendment which will be acceptable to the Government. I am aware that a large majority of the workers in the transport industry are already members of one or other trade unions. It is rather on behalf of those members of the industry who are not members of a trade union that this Amendment is moved. They are, admittedly, few, and the reasons for them not belonging are various. There is a possibility that one of the reasons why those workers have not wished to belong to a trade union is that they are being transferred, whether they wish it or not, into State employment, particularly the smaller concerns. And when this Bill becomes an Act we shall have obtaining a situation which gives rise, I think, to several important implications and repercussions.
The first of these which I would like to put is this: Is it right that a state monopoly should be able to make membership of a trade union a condition of service? If the answer to that question is "Yes," then there are two results, which I submit may be undesirable. One is that the State will have the power to make a working man industrially untouchable, even though he has spent the whole of his life in the transport industry, and even though he knows no other trade. The second is that, if the State should see fit to favour a particular

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union, then a private monopoly will arise which is completely backed by a public monopoly, and that private monopoly will be in a position to dictate to the Government but will not in itself be constitutionally responsible.
I am well aware that there are two aspects of this very vexed question of the closed shop. If I understand the situation correctly, one is the refusal of members of a trade union to work with men who are not members. There is nothing whatever in this Amendment which I am moving to-day which touches the principle of 100 per cent. trade union membership. The other aspect of the closed shop is the attempt of the larger unions to make a monopoly of membership in a certain field of the industry. I wish particularly to avoid being accused of provocation, so I will say only that there have been instances in the last two years when some of the larger unions have been in clashes with smaller unions and with individuals, and the results have caused the gravest misgivings to those who have the interests of the liberty of the subject and freedom of conscience at heart. I think that the experience of the last two years suggests that it would be a very unhappy thing to launch this great Act upon the industry with the risk of doing injustice in this particular respect to a small number of members of that industry. I think it would augur well and promise fair play and justice if the Commission give to a man entering an industry—whether he wants to enter it under State control or not—the right to choose to which trade union he will belong. I beg to move.
Amendment moved—
Page 102, line 37, at end insert the said proviso.—(Lord Mancroft.)
LORD WALKDEN: On behalf of the Government I have to state that we cannot possibly accept this Amendment. I am rather sorry it has been moved. The noble Lord, Lord Mancroft, was a little confusing in what he said; he made some reference to non-unionists and then went on to say that his remarks referred to what I may call wrong-unionists, that is men in the wrong union. The non-unionist is a troublesome fellow, but he is generally open to persuasion. In my organization we always use peaceful persuasion; it is all done by kindness! But in the more horny-handed organizations they lose their patience and they employ
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other methods. They will not work with a man who will not join their fellowship. In effect they say to the employer, "The union established and maintains our condition, and we cannot tolerate anyone who does not help." The non-unionist seems to think he has a conscience, but it is an inflated ego. He has a queer mind. Those of your Lordships who have been in elections may remember that you come against these people when visiting the electors. They say, "I won't vote; I won't take any part." They are anti-civic in their minds. There are some people who will not have a doctor. I believe the noble Lord, Lord Mancroft, is in the legal profession. How would he feel if he were briefed to deal with a father who would not have a doctor in the house when his child was dying?
VISCOUNT SWINTON: Are Christian Scientists to be prohibited from seeking employment?
LORD WALKDEN: They might be. There are strange bodies, including one called Christadelphians and what I believe are called Plymouth Brethren—I am not sure of the name, but they are queer, peculiar people. You must not be surprised if most working men say to the employer, "We would rather you sent that fellow off. He will only cause trouble," But the wrong-unionist is the worst man. I know the case to which the noble Lord was referring. It was on the London Passenger Transport Board. There was a man who joined a breakaway union, and in the trade union and industrial world there is nothing worse than these breakaway unions. This breakaway union was formed by a few busmen who did not like a settlement that Mr. Bevin had made. A friend of theirs in another place, Mr. W. J. Brown, a queer fellow who changes his political opinions every year, helped them to form another union of their own, until the other men said, "We cannot work with these fellows." They had overtures with Lord Ashfield, and he agreed that these men should be excluded from their occupation.
The greatest industrialist in the world, Henry Ford, said, "If I have to recognize trade unions I will recognize only one." Most great industrialists have minds like that, and in the world of labour it is an awful job when you have an infinity of unions. We have in the railway world a number of signalmen; there was a man

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who disliked J. H. Thomas and for that reason encouraged them to form a union of their own. That is what I mean by a wrong union. The men who go into these breakaway unions are a curse to industry. The London Passenger Transport Service to-day is happier and going on better than when those cantankerous fellows of W. J. Brown's were in their midst.
Coming to this new national transport service: In Clause 95, there are proper standardized provisions laid down by which the Commission will negotiate with the appropriate union—that is the union whom the Commission consider appropriate—with a view to making arrangements for carrying on the industry. When these unions get together with the Commission they will make the working arrangements. It is to the glory of the trade union movement that it accepts responsibility and tries to carry on industry harmoniously and satisfactorily, with the maximum production and working jointly together. A great deal is going on, and we ought not to crab it by encouraging these queer people to refuse to be harmonious with their colleagues. The Commission should be left perfectly free to make what arrangements they think best for the welfare of the industry, along with the great responsible unions, and no one should say "You must not have a closed shop." It would be a great mistake for this House to say that. We ought not to come in on a sort of side wind. I am sorry the noble and learned Viscount, Lord Simon, is not here, for I wanted to tell him that. The Commission should be free to make their arrangements, just as any other great employer is.
That is the general case, but there are one or two other facts. I was going to tell the noble Earl, Lord Howe, if he had been present, that this was fully discussed in another place. I was present at the discussion; it was very interesting and a clause like this was defeated when a vote was taken.
VISCOUNT SWINTON: Was not the Amendment moved in another place an Amendment that nobody should be forced to join a trade union, whereas this Amendment says that people shall not be forced to join a particular one? Is that not so?
LORD WALKDEN: By and large, the substance would have the same effect.
NOBLE LORDS: No.
VISCOUNT SWINTON: I am sure the noble Lord will wish to direct his mind to what is before your Lordships. What is before the Committee is not whether there should be power to say that everybody must be in a union. The sole question before the Committee is: assuming that everybody is put in a union, is everybody to be forced to join one union?
LORD WALKDEN: I quite agree that is the text of the noble Lord's Amendment, and it is slightly different from the one that was dealt with in another place, but the principle at issue is just the same. I do not mind; we will stick to this. I think I have made it clear that the employer should be left free to decide on the unions that the men shall be in. If that is the decision, and they agree as to what unions they should be in, an employer should be free to say: "I do not want to worry about this little bunch of busmen; I do not want to worry about this little bunch of electricians; I want everybody to be in the Transport and General Workers' Union"; or whatever union he may be talking about. That will be much better for carrying on the business and maintaining harmony. That is the point of that, but it was discussed in another place and the principle of the closed shop was dealt with, and the Amendment was turned down.
Then there is something else which I hope will appeal to your Lordships still more. About a year ago we had in this House the Trade Disputes and Trade Unions Act, which covered this question. It covered a lot of vital points, most important in the world of labour, and that Bill swept away the restrictions that the workers had resented for twenty years. One of those restrictions that was swept away was the refusal to allow them to have a closed shop if they could agree about it with the employer. The municipalities now are free, whereas two years ago they would not have been. Their engineer can say, "It is much better that you should be in the A.E.U., or something of that sort. We will work together very well. I would like everybody to be in it. "He can now say that, and the Commission should be able to say that if they wish to do so.
That Act was dealt with here. It was thoroughly debated on all points. We had a splendid Second Reading debate,

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and there was no Division in Committee. There were no Amendments, except one which was made by my noble friend Lord Merthyr, which was to take out of the measure one of the cardinal features. This is what the noble Viscount, Viscount Swinton, said then:
"We should be exceeding our proper constitutional function if we amended this Bill in a manner which struck at its fundamental provisions. I think that by its history, its structure and its provisions this Bill necessarily stands or falls as a whole."
It stood as a whole and was carried without a Division. Having made that decision only a year ago, that each industry was free to have a closed shop, I do suggest it is most unfortunate that there should be an attempt to get back again in that indirect way to the principles which I know are very dear to the noble Viscount's heart, but which the workers of this country will not tolerate any more.
VISCOUNT SWINTON: I gather that it is suggested that any Amendment of this kind is entirely contrary to the Bill to which this House gave passage without Amendment. I really have never heard a more extraordinary proposition advanced in a more curious speech. Did anybody ever suggest, when the Trade Disputes and Trade Unions Act was going through this House, that the object of it, which we thought was freedom, was to give power—indeed to give Governmental and statutory applause—to the proposition that men should be forced to join one particular union? Nothing of the sort was ever advanced, nor is there a clause or word in the Act which can justify any such proposition. The noble Lord has thought fit to take my noble friend to task for putting down this Amendment. I think your Lordships will be grateful to the noble Lord for having put this Amendment down, if only for the fact that it has drawn from the noble Lord such an intensely informative and revealing speech.
It is a curious speech. A good many people came in for censure in it. We were told how iniquitous it is that a man should change his Party. Mr. Brown was cited. He was held Up to what is, I believe, called by lawyers "hatred, ridicule and contempt." because he had ventured to change his Party. The noble and learned Viscount the Lord Chancellor and the Chancellor of the Duchy have left the
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Chamber. They must have had notice of this question. The noble Lord ought also to have given notice to the Leader of the House. May I say that those Benches, and the Government Benches in another place, would certainly not be so full as they are if there were this prohibition on people changing their Parties? But no-body is to be allowed to join the union he pleases. I leave aside the rather gratuitous insults which were hurled at a number of religious denominations. I do not know why they should have been singled out for the noble Lord's scorn and cynicism. He may not himself belong to any particular religious denomination, but he might learn a little tolerance. After all we each serve the same Master, "you in your way, I in His."
Just see where this is leading us, this new doctine which has been adumbrated, that people must not remain outside the union which the Minister thinks it right for them to join. He gave us his experience, and I am going to ask where these men can remain, because from the Government Front Bench it sounds something like "His Master's Voice." He has the power of the trade unions behind him. Where is this leading us? I thought the noble Lord cited Mr. Bevin. The last speech of Mr. Bevin I read was one of the most eloquent that he has ever delivered against the One Party State—the wickedness, the denial of democracy when men were all forced into one Party. What else was the noble Lord saying in his speech? "You may be forced into one Party, when you vote at the election—or forced into one union." Now we know; we know what the policy is. The policy of the Commission is that they have a free hand, but they are to have a free hand with a blunt indication from the Government—because presumably the noble Lord was speaking with the full authority of the Government—that they had better see that everybody joins one single union; and that the union of which His Majesty's Government approve.
This extraordinary statement having been made on behalf of the Government, may I ask a final question? It is intended that the Minister is to give instructions to the Commission on matters affecting the national interest, and the noble Lord has just told us that he regards it as in the national interest that people should be compelled to join a particular union. I

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therefore put this question categorically, and I ask if I may have an authoritative answer: Under this Bill will it or will it not be within the power of the Minister to give direction to the Commission that men are to join a particular union?
THE MARQUESS OF READING: I want to add only a very few words, but having moved a clause not entirely dissimilar from this in connexion with another Bill a little while ago, I would like to say those words. I confess that I understood quite plainly the point which Lord Mancroft was making in moving this Amendment. He was not for a moment denying the right of a man to join a trade union, but was merely upholding his right to select the union he should join. I think that if the noble Lord who replied for the Government had listened to the point that was being made, he really could not have failed to understand that, Especially coming as it did from the noble Lord, Lord Walkden, the speech which was made just now was really an astonishing and, in some ways, a rather shocking speech. I wonder if the noble Lord, looking back on that speech, quite realizes what he has said, or if really he meant to convey the impression which I think unhappily he did convey to some of us.
Is he really saying that a man who chooses to join a union which is not perhaps a big union in the particular line of work which he follows, makes that choice only because he is suffering from inflated ego; that that is the only factor that can lead him to join any union other than what you might call the dominant union in his particular trade? Is it suggested that he does it simply because he is a cross-grained individual, an unsociable person suffering from inflated ego, and not because the smaller union might suit the particular purposes of his immediate craft better, and that he may be more at home and comfortable in the small union? Is it implied that there is in him some original industrial sin which makes him suffer from inflated ego, if he seeks to join any union other than the one which it has been arranged for him to join?
I have never heard doctrine in this connexion carried to these lengths before, at any rate, publicly, and I was a little surprised to hear the noble Lord bringing it up to that pitch to-day. Would he, I
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wonder, go as far as this? We have had a reference to-day to the Trade Disputes Act. Under that Act one point was that persons who did not wish to contribute to the political levy were to be free to contract out. Would the noble Lord go the next step—because it seems to me it would be logical from what he said—and say that any man who contracts out of paying the political levy is doing so merely because he is suffering from inflated ego? If that be the orthodox trade union view we shall know a little better what the attitude is to those men who venture to contract out.
LORD DUKESTON: I venture to address your Lordships on this very important question in the hope that we may have a little more reason and a little less passion in our discussion. The plain fact is that this Amendment seeks to make it illegal to impose, as a condition of employment, membership of a particular union. That, as I understand it, is the purpose of the Amendment. From the statements made by some noble Lords, it would appear that they assume that there is only one union to be considered in this matter, and some little play has been made regarding what are called large unions. In the world of transport there are more than forty unions. There is complete agreement amongst those organizations as to how they conduct negotiations. I believe I am right in saying that in the Railway Shop Council some thirty-two unions have representation. There is complete harmony, and really it is not a case in the industrial world of the big union versus the small union. That is not the case at all. The question really is, what are you going to do in respect of a small minority who refuse to accept the terms of a negotiated agreement, elect to break away from their own trade union, form a separate organization and claim representational rights? That really is the problem in industry.
I beg the Committee to understand that the carrying into effect of this Amendment could mean nothing other than strife and difficulty in industry. I am sure that those who put this Amendment down, actuated undoubtedly by the motive of conceding the right of conscience to an individual, are really obscuring in their own minds the difficulty which actually exists. I am sure

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that I speak for all noble Lords on this side of the Chamber when I say that we have as much respect for conscience as any other noble Lords. But we are not here dealing with a matter of conscience. It is very rarely that we find men who act in the way suggested by the noble Lord who moved the Amendment. But considerations which lead to making membership of some trade union a condition of employment invariably arise out of the circumstances that I have already related. Let me carry this a little further, so that we may have the benefit of advice as to how an authority would act in the event of an industrial dispute arising over this very question.
It may be that any of the services functioning under the control of the Commission may be confronted with this difficulty. Some score or more of members, dissatisfied with the terms of an agreement which may have taken months to negotiate, may express their dissent by withdrawing their membership from a particular union or more than one union. There may well be other men, in the majority section, who are also dissatisfied with the terms of the agreement, but, being reasonable and having to arrive at an agreement of some sort at a particular time, they have compromised their position. That is the general practice in the matter of negotiating agreements, and those men continue in the expectation that at some later date a more favourable agreement may be negotiated. Then they find that in spite of their own reasonable approach a minority of their own members break away and set up a new organization. The men may become so incensed that rather than work with this minority they will strike. What can the Commissioners do in these circumstances? This Amendment would deprive them of the only practical way out, and I can well imagine public opinion becoming so incensed in those circumstances as to lead to difficulties which I am sure are not envisaged by those who have moved this Amendment.
I beg noble Lords to get away from this idea of abstract liberty. It does not exist. We are living in a world of balances and unless we can get a balanced position in industry we shall see this matter fought out in a manner inimical to the industrial interests and certainly inimical to the interests of the State—and I am sure the industrialists in this House
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will agree with what I am saying. The same problem arises with the individual corporation and private employer. What are they to do in these circumstances, accepting the theory that all are concerned with the general public interest? Where the private firm is confronted with 1,000 or 5,000 men so incensed at what they believe is an injustice as to cease work because of the attitude of a score or more men, what remedy can noble Lords suggest? That really is the problem in industry to-day. It has lead to more friction in the workshops than any other single problem.
I sincerely hope this Amendment will not be pressed. I said in an earlier speech in your Lordships' House that we are most anxious to see that British industry is carried on in future without this kind of internecine warfare between group interests in the industrial world. I am certain no one wants to see anarchic elements in the trade union side, any more than upon the employers' side. If it were appropriate I could reveal to your Lordships years and years of effort carried on by the trades unions, seeking to restrain and restrict the employer who does not play the game within the employers' organization; we have done that police work within my own experience, for well on to half a century. If I thought this began and ended with a matter of conscience I should have an entirely different approach. I have explained that membership of a trade union, measured as a matter of conscience, is a very small matter in the sense of the obligation placed upon the individual for there is nothing more than a contributory obligation imposed. That is really the beginning and end of it; there is no functional obligation. I thought I had made that clear.
I am afraid that I must tell you Lordships that if this Amendment is carried and becomes law it will create such resentment in the trade union world as to imperil the general peace in industry which we have all striven to create, particularly during the war years, and which has been carried over into the post-war period. I can see nothing but trouble arising from it. I can see certain elements taking advantage of this Amendment to rebel. They will do that not merely as individuals but will seek to seduce from their allegiance to the trade union move-

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ment certain rebellious elements which in every industry the trade unions have had great difficulty in restraining. I beg your Lordships not to pass this Amendment. I can see no good at all arising from it. I can see a great deal of evil following from it, and from the implications inevitably arising from it. I do beg of you not to press an Amendment which can make no contribution to the economical rehabilitation of our country and which does nothing more than throw a spanner into the wheels of that machinery which has been so painfully built up over the years, and which has become the standing example to other industrial countries.
LORD BEVERIDGE: I do not want to discuss the general question which has already been discussed but I want to put one point which is troubling me. This Bill is not dealing with industry in general, it is dealing with a monopoly. We have pointed out that this is in design a monopoly, and that means that if this Amendment is resisted, and a man has to join a particular union, a man who has been working a long time in this industry may find himself turned out by the decision of a particular union. If that union does not admit him, then he cannot be in that industry. That is a point which has not been mentioned by any spokesman on the other side. It has nothing to do with conscience, though all have a right to rebel; and conscience and the right to rebel are rather sacred and important things. You are dealing with this practical issue. If you are to insist that nobody may be employed in this industry unless he joins a union, the correlative is that the union shall not keep out a man qualified to join it, shall not of its own free motion refuse to admit him. It would be impracticable to require a union to admit a man and give him an appeal to the High Court. But if you do not do that then surely you are putting his whole livelihood—I am not concerned with conscience—at the mercy of a body which is entirely beyond any kind of control by Parliament and the Government. I hope we shall get some answer on that point.
LORD SALTOUN: My Lords, I am perfectly confident that the noble Lord, Lord Walkden, in every action of his life has diametrically contradicted the theory he has enunciated on behalf of the Govern-
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ment—that is, that a man's conscience is only inflated ego—because the very existence of the union to which he belongs, and every great union, is due to the stubbornness of the British conscience. I intervene precisely on the point made by Lord Beveridge. If this Amendment is not to go into the Bill, then I think the Government should put in something like this: that no man who has applied to belong to a union and has not been accepted by that union should be refused or deprived of employment. I think the Government should put something like that in, and make it perfectly clear, in the light of what has already been said in this House. I shall very much regret if anything in this Bill, which is a Bill on a special measure, should ever limit the rather peculiar and uncertain, but very important, workings of the British conscience.
LORD LINDSAY OF BIRKER: May I be allowed to say a word on this Amendment? If the Amendment is, as I hope it will be, rejected, while the power which is left to the Commission in the Bill might be used unwisely, as employers in industry might use the same power which they possess unwisely, unless they are allowed to use their wisdom and their sense in dealing with the problems that arise, all the disasters which my noble friend on my right described might occur. This is a question of giving freedom to the Commission, and trusting that they will use it wisely.
LORD MANCROFT: I owe the Committee an apology for having misinformed them by stating that this was an uncontroversial Amendment. I had no idea that the remarks which I made would cause so much disturbance. I am reminded of an occasion when I, together with two other members of your Lordships' House, succeeded in inducing a small but highly greased pig into the senior common room of an Oxford college.
LORD LINDSAY OF BIRKER: It was you, was it?
LORD MANCROFT: I had intended on that occasion to cause trouble, but on this occasion I did not intend to cause trouble, and I do not propose to press my Amendment. I should say straight away that what, above everything, causes me to withdraw my Amendment, is the wise and impressive words of the noble Lord,

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Lord Dukeston. I agree with a great deal of what he said. I agree that there is difficulty in laying down hard-and-fast rules, and I must confess, quite frankly, that I thought the noble Lord, Lord Walkden, was laying down the wrong rule. I was very sorry that the noble Lord, Lord. Walkden—whom I have always regarded as the most mild and tolerant of men—should have made a speech which was, to my mind, almost saying that might is right. He is the last man I should expect to say that. I do agree with the noble Lord, Lord Lindsay, that it would be unfair to fetter the discretion of the Commission right at the outset, in a way which might prejudice the safety of the whole industry. I think this has been a useful discussion, and it has produced information from the Government on two vital points. With those words, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 95 agreed to.
Clauses 96 and 97 agreed to.
4.54 p.m.
Clause 98:
Provisions as to pension rights.
98.—(1) The Minister may make regulations for all or any of the following purposes, that is to say—
(a) for providing pensions to or in respect of—
(iv) persons who are or have been employed in connexion with the Caledonian and Crinan Canals or Holyhead Harbour, or by or in connexion with the Railway Clearing House;
VISCOUNT LONG VISCOUNT LONG moved, at the end of subsection (1) (a) (iv), to insert: "the National Road Transport Federation of the Road Haulage Association." The noble Viscount said: In rising to move this Amendment, which stands in the names of my noble friends Lord Selkirk and Lord Saltoun and myself, I would like to recall to your Lordships a few statements that were made in another place by the Parliamentary Secretary to the Ministry of Transport upon this particular Amendment. He said, in answer to a question:
"I ask him to consider for a moment that these organizations are not transport services at all they are employers organizations, and doubtless they are performing very good work … but we cannot possibly extend the provisions to cover them."
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He went on to say that nobody could possibly maintain for a moment that the Road Haulage Association, however well meaning, or whatever services it may have rendered to the country in the past, was a transport service in the same way as the canals, the buses and the lorries. He further suggested that the Association was comparable with the Railway Stockholders Association, and that the Railway Clearing House is a transport service. If you look at the Bill, your Lordships will see that the Railway Clearing House is to get compensation.
What are the actual facts? I am sure the Parliamentary Secretary did not desire to lead anybody astray, any more than did the noble Lord, Lord Walkden, in his speech just now. The facts are that for many years the organization has been used by the hauliers to discuss and into the whole of the difficult and complicated question of rates and charges. The Association has done direct haulage work, settling all sorts of things. His Majesty's Government must be aware of the fact that the Road Haulage Association took on work for the Milk Marketing Board, and the Coal Board, and arranged the rates within those organizations. It has supplied the majority of the employers panel of the Central Wages Board set up by the Government of the day to deal with the whole of the wages question in transport. But, further than that, since 1940 the Road Haulage Association has carried, in arrangement with the Government, the whole of the livestock and meat transported by road in this country.
If there are any other reasons needed, I can give many. I must press this question about the Railway Clearing House getting compensation. It would appear from what the Parliamentary Secretary said that he knows nothing at all about the work of this Association; otherwise he would not have made that remark. What has actually happened is that the Railway Clearing House has been working cheek by cheek with the Road Haulage Association throughout all these years, and since 1939, when the Road and Rail Conference was formed. Yet the Government deny to the one what is given to the other. Once again, I ask: Is that fair play? I beg to move.
Amendment moved—
Page 105, line 4, at end insert ("the National Road Transport Federation or the Road Haulage Association").—(Viscount Long.)
LORD CHORLEY: I regret that we cannot accept this Amendment. The noble Viscount who moved it evidently feels rather strongly about it, but I must say that, after listening with very great care to what he said it does seem to me that the statement made in another place by the Parliamentary Secretary to the Ministry is really a proper estimate of the position. I would submit to your Lordships that these two organizations really are trade organizations and, as the Parliamentary Secretary said, they are not transport services in the way that the Railway Clearing House is. The Railway Clearing House is a joint organization established by the railway companies for the very necessary administrative problems which arise in connexion with the inevitable cross work between railway transport. The other organizations have no doubt proved very valuable organizations to the different branches of transport in the road hauliers system, but I think it is rather difficult to contend, as the noble Viscount did, that these two organizations are really part of the transport system of the country. In those circumstances, surely it would be a very dangerous precedent indeed to admit them in the way the noble Viscount suggests, and to grant those men (who have been no doubt carrying out very useful services to these two organizations) rights of pension and compensation under this Bill. In the circumstances, I regret that we cannot accept this Amendment, and I hope the noble Viscount will not press it.
LORD SALTOUN: I do not want to say very much to strengthen the case which was made by the noble Viscount, Lord Long, but I was very much struck by the description of the Railway Clearing House given just now by the noble Lord opposite. He said: After all, what more is the Road Haulage Association than an organization set up by many different concerns for solving of administrative problems and difficulties on a common basis? I forget the rest of the words he used, but we will see them in the OFFICIAL REPORT to-morrow. They struck me as being extremely appropriate to the organizations for which my noble friend Lord Long was speaking.
VISCOUNT LONG: I thank the noble Lord for his reply. He said in the course of it that he thought his honourable friend in another place had been correct. His honourable friend in another place said we were like the Stockholders Association. Of course, the noble Lord may still think his honourable friend is correct, but we as an organization have nothing to do with the Stockholders Association at all. We work solely with the Railway Clearing House. I repeat that we have done a very good job of work, and should be given compensation. Yet you refuse the right. I have stated my views on this matter, and I am certain the position will be understood in the country. However, I do not intend to press the Amendment to a Division, and I therefore beg leave to withdraw it.
Amendment, by leave, withdrawn.
LORD BALFOUR OF BURLEIGH: My first Amendment is in the nature of a drafting Amendment, and I understand that the noble Lord is prepared to accept it. That also applies to the next Amendment on page 105, line 34, and another Amendment over the page at page 106, line 47, in Clause 99. They are all connected with the same thing. I will move my last Amendment in its proper place.
Amendment moved—
Page 105, line 9, after ("relating") insert ("in whole or in part").—(Lord Balfour of Burleigh.)
On Question, Amendment agreed to.
LORD BALFOUR OF BURLEIGH: I beg to move.
Amendment moved—
Page 105, line 34, after ("rights") insert ("under the scheme whether such persons as are mentioned in paragraph (a) of the last peceding subsection or not").—(Lord Balfour of Burleigh.)
On Question, Amendment agreed to.
THE EARL OF SELKIRK THE EARL OF SELKIRK moved, after subsection (5), to insert:
"(6) nothing in this section shall authorize the imposition of obligations on any company body or person whose undertaking or any part of whose undertaking has been transferred to the Commission or any other body with regard to contributions in respect of persons who are no longer in the employment of such company body or person, or of persons who remain in the employment of such company, body or person."
The noble Earl said: Clause 98 deals with pensions and it gives the Minister certain powers to make regulations. Under

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Clause 98 (1) (b), the following powers are given to the Minister:
"… for the continuance, amendment, repeal or revocation of existing pensions schemes.…
Those powers are very wide indeed, and could be used to affect any existing pension scheme, presumably whether it exists in a private organization or whether it does not. My Amendment is intended to provide some measure of safeguard in that situation. I think it is perfectly clear that it is not intended in this Bill to impose any new obligations on existing pensions schemes which belong to corporations or bodies, and which will continue to exist apart from the Commission. Accordingly, the Amendment I am proposing should be introduced is as follows:
"nothing in this section shall authorize the imposition of obligations on any company body or person whose undertaking or any part of whose undertaking has been transferred. …"
I understand that this subsection, or something very like it, will be acceptable, and I think some modification of that sort is necessary. I do not stand on the words of my Amendment, but I suggest that the principle is perfectly clear and that some saving clause is necessary to counterbalance the very wide language in Clause 98 (1) (b). I beg to move.
Amendment moved—
Page 106, line 30, at end insert the said new subsection.—(The Earl of Selkirk.)
LORD CHORLEY: I agree with much of what the noble Earl has said, and we are in principle prepared to accept the Amendment which he has moved. We do not altogether like the terms in which he has moved it, and I think if he will confer with us we shall be able to devise a satisfactory form of words which will suit his purpose. We shall then be able to put in an Amendment on the Report stage. Perhaps with that assurance the noble Earl will withdraw his Amendment.
THE EARL OF SELKIRK: I thank the noble Lord for what he has said. I understand that there is a possibility that if after the word "transferred" the words, "by obligations of new regulations" are inserted, something of that sort will be acceptable. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 98, as amended, agreed to.
5.7 p.m.
Clause 99:
Special provisions as to railway and canal pension funds, etc.
99.—(1) The provisions of this section shall, subject to any regulations made under the last preceding section, have effect in relation to pension schemes in connection with the undertakings of the bodies specified in the Third Schedule to this Act and in relation to pension rights of persons who have been in the employment of any such body.
(2) The provisions of this Act which direct that liabilities of a body shall become, as from the date of transfer, liabilities of the Commission shall apply in relation to customary obligations of the body in relation to pensions, notwithstanding that the body was under no legal obligation in respect of those pensions; and if any question arises as to the existence or extent of any such customary obligation, the question shall, in default of agreement, be referred to a referee or beard of referees appointed by the Minister of Labour and National Service, and the decision of that referee or board shall be final and the Commission shall give effect to that decision.
LORD BALFOUR OF BURLEIGH: This Amendment is another drafting Amendment. I beg to move.
Amendment moved—
Page 106, line 47, leave out ("in connection with") and insert ("relating in whole or in part to"). —(Lord Balfour of Burleigh.)
On Question, Amendment agreed to.
THE EARL OF DUDLEY THE EARL OF DUDLEY moved, in subsection (2), to leave out "and the decision of that referee or board shall be final." The noble Earl said: On behalf of my noble friend Lord Simon I beg to move this Amendment. The Amendment aims at removing what appears to be an inconsistency in the Bill, and I think and hope that the Government will accept it. Clauses 98 and 99, as your Lordships are aware, make provisions as regards pension rights and pensions funds. Clause 98 (3), at the top of page 106, says:
"Any dispute arising between the Minister and any person as to whether or not the said result has been secured by any regulations made under this section shall be referred to a referee or board of referees appointed by the Minister of Labour and National Service for his or their determination thereon."
Clause 99 (2), however, says:
"…the question shall, in default of agreement, be referred to a referee or board of referees appointed by the Minister of Labour and National Service and the decision of that referee or board shall be final and the Commission shall give effect to that decision."

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I fail to see why the decision of the referee should be final in one case and not in the other.
In fact, the decision of the referee or board of referees on a matter of law should be reviewable by the Courts by way of case stated. This is rather a legal point, and I am sorry that the noble and learned Viscount, the Lord Chancellor, is not in his place. If the words relating to the decision being final are omitted, it would appear that the board of referees can be directed to state a case for the decision of the High Court on a matter of law by virtue of the provisions of Section 9 of the Arbitration Act, 1934.
I would like to draw your Lordships' attention to the question that customary practice and customary obligation arises under the Third Schedule to the Railway Act, 1921, and that the tribunal there charged with determining those questions is an independent arbitrator appointed by the Lord Chancellor, and his decisions can be reviewed on a point of law. Therefore, the precedent exists at present. A very large number of cases have come before the standing arbitrator during the last 25 years during which the Railway Acts have been in operation, and many of these have been taken to the Courts for review. It would, therefore, appear to be both in the interests of the Commission and the individuals concerned that the Court should have jurisdiction in the matter. I believe that this must be an oversight in the drafting of the Bill, and I very much hope that the Government will accept the Amendment. I beg to move.
Amendment moved—
Page 107, line 12, leave out from ("service") to ("and") in line 13.—(The Earl of Dudley.)
VISCOUNT MAUGHAM: I am at present unable to see why there should be this difference between, the powers of the tribunal. I am in hopes that the Government will be able to give us some satisfactory ground for distinction between the cases. The matters that may come before the tribunal under the subsection which is under discussion may be of great importance to people of not very large means. The points may be points of considerable difficulty, but I do not suppose many people will want to appeal against the decision of the tribunal. It does not seem to
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me, however, that there is any obvious ground for the view that there should not be appeal in any circumstances, even with the consent of the tribunal itself. In those circumstances I beg to support this Amendment.
VISCOUNT RIDLEY: I hope the Government will support this. It does seem unfair that railway employees drawing their pensions should be treated in a different way from others coming into the range of this Bill, particularly in view of the fact that at present railway pensioners have under the Act of 1921, a special protection which allows for an appeal in those cases. As the noble Lord has said, there have been quite a number of appeals, which shows that there is some substance in the suggestion that the appeal should be allowed.
Lord BALFOUR OF BURLEIGH: I hope we are pushing at an open door here, the reason being, I believe, the inconsistency which the noble Earl, Lord Dudley, has referred to. It arises from the fact that there were put into Clause 98 in Committee in another place the words beginning "Any dispute arising." I think it must have escaped the notice of the Government draftsman. I feel confident that the Government will be able to accept it.
LORD CHORLEY: I regret that the Government are not able to accept the noble Earl's Amendment to this clause. The clause to which the Amendment is moved is a clause which represents the Government's considered view as to the way in which this particular type of matter ought to be dealt with. Whether the noble Lord, Lord Balfour of Burleigh, is right about the alleged inconsistency with the earlier clause I really am not prepared to answer categorically, without further advice; but on this type of matter the Government take the view that this is not the sort of thing which is most appropriately dealt with by the rather protracted and formal methods of Courts of Law and Appeal. The situation under this Bill, and other Bills of a similar nature which are being introduced for the purpose of nationalizing certain of the basic industries of the country, is on quite a different basis from that under the Railways Act of 1921, which was a measure purely for the purpose of coordinating a number of privately owned

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railway companies. The Government's view on this matter is that this type of point, which will arise, not only under this Bill but under other Bills and has already been legislated for in earlier Acts, such as the Electricity Supply Act, is much more effectively and efficiently dealt with as an industrial problem than as a legal problem.
In order to decide a point of this kind, it is true, the referee should be a man with legal training and a legal background. I think your Lordships will agree with me that it is equally important, if not more important, that he should have an industrial background and that he should be habituated to dealing with problems which affect industry. A court of law has not that background and there can be no question that, on the whole—although speaking as an old member of the Bar I naturally have considerable sympathy with a motion which is intended to preserve work for the courts—looking at it as objectively as possible, one is bound to confess that, in so far as over recent years this type of dispute has been withdrawn from the ambit of appeals and cases stated, it has worked very successfully. The Electricity Supply Acts are one example.
There are particular problems which are continually arising under the Unemployment Insurance Acts, where the matter is finally dealt with by an umpire and does not come to the courts of law at all; that, I think, shows that this method has worked very successfully. There is no question at all that it does appeal to the trade unions who found under the old system, and who still do find, in so far as that system still exists, that very large amounts of money are frittered away on disputes which often have little substance in them, being merely a question of a cantankerous person wishing to go on as long as he can. The result is that, in this series of Acts, the ambit of which I have described to your Lordships, the Government have decided that on the whole it is better that a speedy and final decision of this kind should be come to by a perfectly well qualified and obviously perfectly impartial person in the form of a referee appointed for the purpose of dealing with problems of this kind. In those circumstances I hope that the noble Lord will withdraw his Amendment.
VISCOUNT SWINTON: I do not speak as a great expert, but I think that the Minister has not directed his mind to what is the purpose of this Amendment. He talks about the importance of an industrial background for the man who is to decide this: nobody disputes that at all. All the questions of fact we want to be decided by an umpire. The idea is that his decision should be completely final. But what may happen here, as I understand it, is that there may be a question where a pure point of law is involved. It may be a point of law on the construction of this not very clear Bill as to what his own powers are; it may be on a legal construction of the documents of title under which a person is entitled to his pension, not whether the man has met with an accident, or the amount teat he ought to get. On all these industrial questions everybody agrees there should be no appeal; they will be dealt with by the referee. But on a pure question of law—I do not know where the trade union comes in over this—maybe the Commission say that the referee is applying the law wrongly; maybe the man himself may ask why he should be deprived of the right to go to a court of law on a purely legal question. The Minister has said: "You know, that was all right when you were dealing with railway companies in the old days, but now we have a new kind of institution. We have this Government monopoly. That really ought to be outside the law; it ought not to be treated in the same way. When we nationalize an undertaking and people have the benefits of nationalization, they must forego the benefit of appeal to a court of law."
That is a very odd principle that has been enunciated this afternoon. We are not trying to create work for lawyers out of this. We are trying to preserve whether it is in the interests of the Commission, or whether it is in the interest of the private citizen concerned in this, that he shall have the simple elementary right, on a point: of law, to go to a law court. The Lord Chancellor introduced a Bill which we passed with enthusiasm, to say that anybody could sue the State or any Government Department exactly as a private individual can be sued. Why is this now to be taken away? I hope the noble Lord will look at this, because I am quite sure he has not directed

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his mind to what, as I understand it, is the purpose. He said he could not say what was the difference or that there was a difference between the clauses. That there is one there can be no doubt. If the noble Lord will read the end of subsection (3) of Clause 98, he will see that there is nothing there about the referee's decision being final. It says that any dispute:
"…shall be referred to a referee or board of referees appointed by the Minister of Labour and National Service for his or their determination thereon."
Then subsection (2) of Clause 99 says that any question:
"…shall, in default of agreement, be referred to a referee or board of referees appointed by the Minister of Labour and National Service, and the decision of that referee or board shall be final and the Commission shall give effect to that decision."
Really, this is not a highly difficult piece of legal construction. It is written that he who runs may read. In both cases, the matter is referred to the referee appointed by the Minister of Labour. In one case the referee's decision is to be final, and in the other case it is not. I assert definitely that there is that difference. Perhaps the noble Lord cannot give an answer now, but if we cannot settle the point now we ought to return for more detail at a later stage.
VISCOUNT RIDLEY: May I ask whether the railwaymen under Clause 98 (2) are in a worse position than pensioners under Clause 99 (3)?
VISCOUNT MAUGHAM: I suggest that the noble Lord who answers for the Government is just a little in doubt over the subject. The argument presented to your Lordships by the noble Viscount, Lord Swinton, does offer a means of compromise which I think the Government might accept. If a question of law arises, the decision of this tribunal would not necessarily be final. I understand the noble Lord thinks it is very unlikely that the question arising would be a question of law. If he inserted words which provided that should a question of law arise in determining the points at issue under this subsection, there should be a right of appeal, we should not be giving away any of the principles which the noble Lord has enunciated to the House, but at the
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same time it would greatly soothe the minds of some people who are anxious that pensioners should have fair treatment.
LORD CHORLEY: The noble Lord made it clear that it was a point of law, and my answer was entirely based on that subject. I accept that this Amendment is dealing with the question of law.Prima facie, looking at the two clauses, I am inclined to agree with what the noble Viscount, Lord Swinton, says, that there is an inconsistency; and in these circumstances we shall have to reconsider the matter.
VISCOUNT SWINTON: The Government are proposing to take away under one clause a right which they give under another.
LORD CHORLEY: It is obvious that there is a difficulty, which we should like to consider further. In doing so, I am quite sure that my right honourable friend will be glad to give attention to the arguments which have been brought forward. It is obvious that there is a good deal of feeling, and if I may ask your Lordships to leave it on the basis that we will reconsider the matter, I shall be glad to see what can be done.
THE EARL OF DUDLEY: If the noble Lord can assure me that he is not going to take away what is laid down in Clause 98, and that the point will be looked into, I shall be satisfied. After all, this is not an industrial matter at all, it is a direct matter of business; and everybody knows that you cannot deal with these pension cases in 100 per cent. of instances with a fixed yardstick. They are very delicate things, and call for a good deal of elasticity. The referee cannot possibly be a sort of super Solomon who will lay down, in every single case, the ideal answer. If I were the referee I should very much prefer that there should be a subsequent court of appeal against my decision, because I should know that it would be quite impossible for me or anybody else to give the right answer in every single case. It is a most important consideration. After all, your Lordships' House is the final Court of Appeal, and I am sure all noble Lords will haw great sympathy with demands that there should be a further appeal in these cases. I hope that not only will the matter of inconsistency be looked into, but also the fact

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that Clause 99 should be treated in exactly the same way as Clause 98. There must be a final appeal, where necessary, to a court of law.
LORD CHORLEY: My real point is that in addition to the arguments which noble Lords have addressed to the Committee on the merits of this proposal there is also the question of inconsistency, which is very important. In those circumstances I can give him the assurance for which he asks, that we will not go back on Clause 98. If he will withdraw this Amendment we will go into the whole matter and bring it up again at the Report stage.
THE EARL OF DUDLEY: In view of that assurance I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 99, as amended, agreed to.
Clause 100 agreed to.
5.30 p.m.
LORD BALFOUR OF BURLEIGH LORD BALFOUR OF BURLEIGH moved, after Clause 100, to insert the following new clause:
Compensation to officers and servants of railway companies.
" —(1)(a) Subject to the provisions of this section the Commission shall pay compensation to all officers and servants continuously employed from the 19th November, 1945, to the date of transfer by a body mentioned in Part I of the Third Schedule to this Act whose undertaking is transferred to the Commission under Part II of this Act or employed by or in connection with the Railway Clearing House and who suffer loss of employment or loss or diminution of emoluments or pension rights or whose position is worsened in consequence of the transfer or of the coming into operation of any provision of a scheme under this Act relating to the Railway Clearing House. Provided that, the Commission shall not be under any obligation to pay compensation under this section to an officer or servant who entered the employment of a body whose undertaking is so transferred or the employment of the Railway Clearing House in consequence of a direction or written request made by or on behalf of the Minister of Labour and National Service or the Minister of Labour for Northern Ireland.
(b) As respects any person who before the said 19th day of November, 1945, was employed by any of the said bodies and who before on or after that date left that employment to enter upon a period of whole time war service that period or so much thereof as was before the date of transfer shall for the purposes of this section be deemed to be a period during which he was employed by that body.
In this subsection the expression "war service" means any whole time service of the
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kind referred to in Section 6 of the Reinstatement in Civil Employment Act, 1914.
(2) Compensation shall be payable under this section in respect of—

(a) loss of employment or loss or diminution of emoluments or a worsening of position if such loss or diminution or worsening occurs within ten years from the date of transfer and if the officer or servant claiming such compensation gives notice in writing to the Commission of such claim within two years from the date on which the claim arises;

(b) loss or diminution of pension rights if such loss or diminution occurs within ten years from the date of transfer or within two years from the date on which the pension becomes payable either legally or by the customary practice of the body by whom the person was employed immediately before the date of transfer whichever shall be the longer and if the officer or servant claiming such compensation gives notice in writing to the Commission of such claim within two years from the date or which the claim arises.

(3) Compensation shall be payable in respect of an officer or servant—

(a) who suffers loss of employment or loss or diminution of emoluments in accordance with the provisions of the Fourth Schedule of the Local Government Act, 1933, and those provisions shall accordingly apply as if they were herein re-enacted with the necessary modifications

(b) who suffers loss of pension rights by way of an annual sum or (at the option of such officer or servant) a lump sum representing the capital value of the annual sum;

(c) whose position is worsened by reason of the transfer by way of such lump sum as in all the circumstances the Commission or, in the event of dispute, the referee or board of referees think represents proper compensation for such worsening such sum being in addition to any compensation to which such officer or servant may be entitled under the preceding paragraphs of this subsection.

(4) Any dispute between the Commission and an officer or servant claiming compensation under this section as to whether any or what compensation is payable shall be referred to a referee or board of referees appointed by the Minister of Labour and National Service for determination and such reference shall be deemed to be an arbitration within the meaning of the Arbitration Acts, 1889 to 1934, and the provisions of those Acts relating to statutory arbitrations shall apply to such reference and determination.
(5) Nothing in this Part of this Act shall be construed as enabling Regulations to be made prejudicing the rights of any person under the Third Schedule to the Railways. Act, 1921, or Part VII of the London Passenger Transport Act, 1933."
The noble Lord said: In taking this clause we are approaching a matter to which everyone connected with the rail-

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ways attaches the greatest possible importance. This is a clause which affects the rights of the 650,000 railway workers who are being transferred under the Bill from the main line companies to the Commission, and unless we can persuade your Lordships to give us this clause something is going to be taken away from the railwaymen which they have had since 1921 as an absolutely indefeasible right, and to which every one of them attaches very great importance indeed. By way of preface I would like to tell your Lordships, on this question of compensation, that from the start it was only very briefly discussed in another place. It was not at all referred to on the Report stage, although it was briefly touched on during the Committee stage. The effect of the new clause is to take the officers and servants of the four main line railway companies and the London Passenger Transport Board out of Clause 101. There are some consequential Amendments to Clause 101, which would follow.
If your Lordships will take the new clause as it stands on the Paper you will see that it consists of five subsections. Subsection (1) makes it an absolute right that the Commission shall pay compensation, and that differs from Clause 101 by the fact that Clause 101 says "the Minister shall by regulations require the Commission to pay, in such cases and to such extent," and so on. Here we are putting back into the Bill the rights which the railwaymen have had under the Act of 1921. The second line defines the people who are concerned, and they are "all officers and servants continuously employed from the 19th November, 1945." It affects every single employee, both the officers and what we call the wages grades, every servant of the Company.
Then, a little lower down in subsection (1) you see a definition of the matters which will give the right to compensation, and that is taken either out of the Bill as it stands or is in accordance with the intention which the Minister has expressed; I think actually it is as stated in Clause 11 of the Bill. It is either in the Bill or as the Minister stated was his intention. I ask your Lordships to forgive me if I am not quite clear on what is in the Bill and what the Minister has said he is going to put in the regulations, because it comes to very much the same thing.
Paragraph (b) of subsection (1) is new. That says that "as respects any person who before the 19th day of November, 1945, was employed," he shall have the right to compensation; and that has been put in because the Minister indicated that compensation would only apply to people who had had eight years' service. We believe that the Minister's intention was to exclude from compensation people who had been directed into the railway service as a matter of war service, and we think it is not unreasonable that those people should be excluded. We have therefore provided for that in the new clause. On the other hand, we do not think it is fair that a man who was a railway man in 1945 and went off to the war should be excluded. Therefore I think that is the purpose of this paragraph (b): that the railwaymen of 1945 who left for war service, whose railway service was interrupted by the war, should not be excluded.
Then subsection (2) as to compensation follows the Minister's statement so far as paragraph (a) is concerned. As far as paragraph (b) is concerned there is an amplification which we think is necessary because it concerns pension rights. It may be difficult to ascertain at the termination of the ten years whether loss has been suffered, and consequently there is an extension there of either ten years or two years afterwards. Subsection (3) prescribes the scale which shall be payable
"in respect of an officer or servant who suffers loss of employment or loss or diminution of emoluments in accordance with the provisions of the Fourth Schedule of the Local Government Act of 1933."
Therefore we are going back to the Third Schedule of the Railways Act of 1921 which, up to the present, has always been regarded as, and has in fact been called, the railwayman's charter. But we have put in the Local Government Act of 1933 instead of the previous Act, which was the Local Government Act of 1888. That brings it up to date. In subsection (3) there should be a little (b). In my Marshalled List, the Eighth Marshalled List, the letter (b) has been dropped out. It does not make sense without it, and the letter (b) should come before the words: "who suffers loss of pension rights." In subsection (4) we have a provision which is something much the same as we have been discussing on a previous

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Amendment, that these disputes shall be referred to a referee or a board of referees, and that is equal to the Third Schedule of the 1921 Act, where a standing arbitrator was provided for. Over the page subsection (5) has been produced just as it is in the Bill.
I have taken your Lordships briefly through this rather complicated clause, and, in moving the Amendment, I would just emphasize that this is providing for the retention by the railwaymen of an absolute right which they possess at this moment. The idea in the mind of the Government or the draftsman is, I think, to put everybody who has been taken over on an equality. If I may say so, that is the sort of idea which any civil servant would quite rightly have. The Civil Service thinks that everybody should be treated equally, and there is a great deal to be said for it; but it is not fair in a case where the railwaymen already possess something which the other people have not got. The road haulage people have never been compulsorily transferred from one company to another. It might be right to have a new code for them, although we shall have some Amendments to move later in regard to Clause 101 which will improve their position also. In this particular case what we are seeking to do is to retain for the railwaymen the rights which they possess, and which I maintain Parliament ought not to take away. I beg to move.
Amendment moved—
After Clause 100 insert the said new clause.—(The Lord Balfour of Burleigh.)
VISCOUNT PORTAL: I wish to speak in support of what my noble friend Lord Balfour of Burleigh has said on the question of this new clause. It is one which I am sure your Lordships will consider is a very right and proper clause on which those people who are associated with railway companies should speak. They should consider as their first duty their duty to the staff and then their duty to the stockholders. It is absolutely right and proper that they should speak on an occasion of this sort. My noble friend Lord Balfour of Burleigh has put the case very clearly and I shall not detain your Lordships for long. I understand that our noble friend Lord Walkden is going to reply to this on behalf of the Government. It should be really a very easy matter for him to
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answer because he has for many years been discussing how very favourably the 1921 Railways Act, which prescribed the compensation code in the Third Schedule to the Act, has worked. He realizes better than anyone how well it has worked.
My noble friend Lord Balfour of Burleigh pointed out quite rightly the great number of people that this concerns; and, as he said, it has worked very satisfactorily. I do not think anybody will deny that it has worked satisfactorily. You are going to take away, as he says, the privilege of right which these 650,000 railway employees have had. What is going to happen now? It is going to go entirely into the hands of the Minister, and the Minister himself will deal with this by regulation. I am not wandering from the point when I say that what the Minister has got on his hands at the present moment is something more than most people can sustain.
Now why should the Minister at this time want to bring in a regulation on this question, when since 1921 we have had in operation a system which experience has proved to be satisfactory? I think that the answer from the opposite Benches will be that it has been satisfactory from every point of view. The noble Lord has pointed out that the vast majority of the people concerned have looked upon it as a privilege to have this prescribed for them in the Third Schedule of the Railway Act. So I am asking Lord Walkden to consider this very seriously from the point of view of the Government. If the noble Viscount, Lord Addison, had been here and we had to deal with him, I should no doubt have adopted the same line as Lord Balfour of Burleigh and the noble Viscount, Lord Swinton, who called him every charming name under the sun when they were trying to get something yesterday. But I would rather attack Lord Walkden, and say that he would be very hard-hearted and would not be using that conscience of which he spoke so much at the beginning of the sitting if he did not help us in the matter of this Amendment. Some of us here have been associated for twenty years and more with the railway companies, and we are perfectly sincere when we say that when we go out of office we want to see our staffs get the sort of deal that they undoubtedly deserve. On those grounds I heartily support this Amendment.
THE EARL OF DUDLEY: I wish to support this Amendment very strongly. As has already been pointed out by the two noble Lords who have spoken, it is an Amendment which is of vital importance to the railway officers and staff generally. I think the Committee will agree that they should have a statutory code which covers their terms of compensation and their future fate, after the years and years of faithful and loyal service which in such a great number of cases they have given to the public. It should not be left entirely in the hands of the Minister to make regulations behind closed doors in Whitehall. It would be iniquitous if that were allowed to come to pass, and the prospect is most disturbing for the minds of the people concerned, as your Lordships can well imagine.
There is clearly an historical case for a statutory code covering compensation. Parliament itself has prescribed it for upwards of eighty years. In 1921, when the railways of the country were amalgamated into the present four main line railways, both Houses of Parliament gave this matter very careful consideration and laid down a statutory code of compensation which would apply in every case to these officers. The thing was not left in the hands of one man but was laid down by Parliament. As the result, these officers knew where they were; they had a fair claim and they were satisfied. Again, in 1933 in the case of the London Passenger Transport Board, Parliament laid down statutory compensation.
Why should these people be worse off now? Is it in keeping with modern democracy that dictatorial powers of this kind should be left in the hands of one man? I suggest that it is wrong. It is true that during the Committee stage of this Bill in another place the Minister laid down, in a rough and ready way, the outlines of the compensation—though only the outlines—that would be given. But he did say this:
"Regard will be had to the applicant's prospect of finding alternative employment."
Do you think it is a right thing for the Minister to say, in the case of a faithful railway servant who may have given many years, or, as in some instances, practically the whole of his life, to the service of the railways: "Oh yes, we will investigate this, and if we do not want him we will look into the prospects of his
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alternative employment."? I say that it is a wicked thing, and I hope that the Committee will give full support to this Amendment.
VISCOUNT RIDLEY: I, too, wish to say a few words in support of this Amendment. One might say that we were asking for better terms for railwaymen than for others, but we are forced to do that because the conditions which We find in Clause 101 in the Bill are not such as seem to us to be right. There is no reason I can see why an Amendment of the kind here proposed should not be followed up, and applied to others who are taken into the services of the Commission. But there is no doubt that the railwaymen, at any rate, are entitled to the treatment which is here proposed in the Amendment. One can expect that as the Commission and the executives begin to re-arrange themselves and start business there will have to be a lot of changes—there is bound to be movement from one place to another—and it is for just this kind of case that this Amendment and, indeed, the original Act of 1921 provided.
In the case of the 1921 Act, Parliament made clear arrangements for compensation. In the present case it is to be done by regulation. Furthermore, at the beginning of Clause 101 we read:
"The Minister shall by regulations require the Commission to pay, in such cases and to such extent as may be specified in the regulations, compensation…"
This means that the Minister has power to exclude certain classes of people—perhaps those who have good prospects of employment—and also the power to exclude those who have not been in the employment very long. In that last connexion, I think he said it would be those who had not been in the employment for eight years. He proposed to leave out people who came into the employment within some period of less than eight years. But a number of people went into the employment of the railways within the past eight years, determined to make a permanent career for themslves as railwaymen, and I submit that they are fully entitled to the protection which others have and which they expected when they came into the service with the 1921 Act behind them. I feel that, as a matter of justice, it is right that this clause should be inserted definitely stating what are to be the conditions.
LORD MANCROFT: I should like to support the noble Lord who has just spoken and particularly to draw the attention of the Committee to the case of professional men—solicitors, accountants and so on—who may be affected. The noble Lord is right in saying that there is risk of real hardship being inflicted here. As I understand it, the applicant at the time of making his application must have been in full-time employment for eight continuous years including war-time service. That provision, it seems to me, will be a cause of great hardship to those who entered the service on a permanent basis less than eight years ago but before nationalization was announced. The Minister, speaking during the Committee stage on April 1, promised that rates of compensation and the whole treatment of compensation would be on the basis of the Third Schedule of the 1921 Regulations. I think it would be very much more satisfactory if we had that promise implemented in the Bill itself. I, therefore, feel very strongly that this Amendment should receive the support of the Committee.
VISCOUNT MAUGHAM: May I add a word on this point? It is largely a question of law and I am afraid that someone who is more fitted to discuss it than I is not able to be here to-day. I do not imagine—but I do not know—that the Government think that where there is a contract to pay any of the sums mentioned in the proposed new clause the Commission is not to be liable to pay them. I cannot think that that is the object, because all along the contractual obligations of the companies—we are dealing here only with railway companies, I think—are to be taken over by the Commission. All that this clause seeks to do is to put down in plain language what the obligations of the Commission will be. It is true that they are stated as positive obligations, and when we come to the next clause, Clause 101, we find there are some words which are going to be dealt with by an Amendment, if we are right, which make it not obligatory, but subject in effect to the will of the Minister. I do not wish to argue that point for the moment, but Clause 101 says: "The Minister shall by regulations require the Commission to pay" and now come the fatal words:
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"in such cases and to such extent as may be specified in the regulations, compensation"
to five classes of officers and servants who obviously are entitled to some kind of compensation for loss of employment, or loss or diminution of emoluments or of pension rights. That clause as it stands, therefore, will not help the officers and servants whom we, on this side, are seeking to protect by this Amendment.
I am not sure that I understand, but I am sure that when the answer has been made from the other side I shall understand, what the real object of the Government is. It is not to deprive people who have been working for the railway companies all their lives of things to which they are entitled, either by contractual agreement or by customary agreement as to what sums are to be paid to people who are leaving the employment of the company, which company is now being acquired by the State. I do not quite know what attitude the Government are taking on this point, but I cannot imagine they are to deprive these poor men of their rights. For that reason I would say no more than I have said in support of the present Amendment.
LORD WALKDEN: We are grateful to, the noble Lords, Lord Balfour and Lord Portal, for the very clear way they explained the meaning of this very long Amendment. If I may refer to the little breeze we had, if I did go rather hot, it was because I suffered very deeply on three different occasions from break-away unions. We had no approaches from any quarter to suggest that this Amendment should go into the Bill, and the Minister wondered why this large Amendment had come along. Representatives of the hundreds of thousands of railway workers to whom Lord Balfour referred had been in contact with the Minister on behalf of their members, had watched the proceedings in another place on Second Reading and throughout Committee, had several interviews with the Minister and found him. quite reasonable, his answers satisfactory and assurances very good. When he made two announcements of an important character in Committee, the larger one on compensation and the other on superannuation, they were entirely satisfied with those statements, which are in harmony with the provisions already embodied in the Bill.

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This Amendment has caused a little difficulty at this late hour, if I may say so, but it has been examined very carefully and there are some deep differences between this Amendment and the view taken by the Government on matters of this kind. I agree with the Minister that arrangements for compensation and other staff questions can better be dealt with by regulation than by clauses in an Act of Parliament. Regulations can be very ample and fully detailed, and they have the further advantage that they can be amended and adjustments can be made fairly easily. There is no question of the Minister pleasing himself. Regulations have to be laid before Parliament in both Houses and objection can be raised to them within forty days. Organizations concerned can examine them and approach the Minister, and arrange with friends to discuss them in both Houses if they are unsatisfactory. I agree that this measure is quite different from the 1921 Act when some score of smaller companies were merged into four. They are railway companies, not great public authorities responsible to Parliament, who must behave above board all the time. I am casting no reflection on the railway companies, but there is quite a difference between a private concern and a public authority.
THE EARL OF DUDLEY: The railway companies are responsible to Parliament under the Act.
LORD WALKDEN: Therefore the staff have every confidence in the Minister's fairness and every effort will be made to treat the staff decently and properly in these matters. Any one group of workpeople concerned in this measure should not be segregated from others in the Bill; they should be integrated. It is very undesirable psychologically to segregate them in a Bill in which their future is to be arranged. That would cause comparisons and dissatisfaction and lead to trouble in the services. With regulations, if there is anything unsatisfactory, proper pressure can be brought to bear on the Minister and the Commission and proper adjustments can be made.
The noble Lord referred to compensation for part-time servants. I think that would be quite wrong. I think there would be a lot of part-time servants. If noble Lords will examine the list of rail-
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way companies in the Third Schedule, they will see that there is an extraordinary number of people who come into this category. In addition to the five big concerns, there are fifty-four little railways. I never thought there were so many in existence. I wonder the big four have not absorbed them. A number of railway companies can only have their work attended to by part-time staff, secretaries and accountants. For instance, there is the East Kent Light Railway Company. The general manager cannot be a full-time man—if they have a general manager.
LORD MANCROFT: When I mentioned the case of solicitors—if I did not say this, I meant to say it—I meant only those men employed on a permanent professional basis, and not part-time men.
LORD WALKDEN: I accept the expression of the noble Lord's intention, but the Amendment would cover part-time people.
VISCOUNT MAUGHAM: I am not so sure that it would. The words "officers and servants continuously employed" might be held to exclude part-time people.
LORD WALKDEN: The part-time people are continuously employed.
LORD BALFOUR OF BURLEIGH: Of course, we would accept an Amendment to put that right. It is not the intention to include them.
LORD WALKDEN: It is one of the factors which arises in the Amendment. The Minister has been advised that it is likely to cover a great many people who may come along with claims which ought not to be entertained. If this is put into the Bill, they will have to be entertained. Then there is the matter of the length of service in the railways. I am not certain, but I think it was laid down that people should have five years' service.
LORD BALFOUR OF BURLEIGH: Yes, it is five years.
LORD WALKDEN: That was because there had been a war running for four years. A lot of temporary people had been brought in during the war, and we felt it would not be fair to put the obligation on the new companies to pay compensation to those people, who had come in during the war and who would leave after the War was over. For the same reason, the Minister desires an eight year

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minimum period. He considers that reasonable, and I consider it reasonable. I dealt with all these matters many years ago. We do not think it right to compensate temporary people who never expected to have permanent employment. There are all kinds of temporary employees; I will not attempt to describe them or I may land myself in trouble. Some of your Lordships have rather reproached the Government on not discharging the temporary people whom they need no longer keep. We had a discussion this morning over people in the fire service, and we were reproached by a noble Lord on the opposite Benches for retaining more men than we ought to retain.
Under this arrangement those people all have a claim for compensation. I do suggest that in the public interest it would not be right to find the money, either provided by the users of the railways or by the Chancellor of the Exchequer—because this is guaranteed under the new stock, and it would have to be made up. That would not be right from the public point of view. The regulations are really intended for older people, and they will all be properly covered; that is to say, all who have given more than eight years' service to railway work. Those are the reasons why the Minister wishes to deal with this matter de novo, in fresh regulations which would be perfectly fair, and to which all the organized workers have agreed.
VISCOUNT SWINTON: Does the noble Lord mean that they have agreed to everything that is going into the regulations, or that they have agreed that it should be done by regulations?
LORD WALKDEN: The regulations are not in being yet. It will be done by the regulations, which are clearly indicated in the Minister's statements and which supplement what is already in the Bill. That covers hundreds of thousands of men through their organized representatives, and the arrangements which have been agreed are quite in line with similar arrangements in respect of other measures of a like character. My noble friend Lord Chorley has already pointed that out. In the national health service, which is coming into operation soon, any person adversely affected will be eligible for consideration on regulations issued by the Minister. The same applies to the national
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insurance service, and also in regard to the mines nationalization. That kind of structure, to provide compensation, protection, safeguards, pension rights, and so on, by regulations, has become a common form. That has all been agreed and. settled, and I think properly settled.
I was rather surprised to hear the noble Earl, Lord Dudley, talk about doing things behind closed doors. When an important Bill like this is on the anvil everybody interested goes to see the Minister —his door is open, and he hears what these people have to say. If that were not done, I do not know how we should get anything into shape which would be acceptable to anybody. We must do a lot of that kind of work beforehand, and it has been done. As the agreement has been reached, I do suggest to your Lordships (I know you take a great interest in agreements being kept) that you should consider very carefully the desirability, or otherwise—and I would suggest otherwise —of doing anything to upset the arrangement that has been arrived at. I am confident that it will work satisfactorily, and that an overwhelming majority of the people concerned are satisfied with it.
VISCOUNT SWINTON: I do not know whether I can shorten this discussion. If my suggestion is unacceptable, then obviously a lengthy debate will have to follow. What I would suggest is this. Obviously, this is a matter in which noble Lords, quite rightly, take a very greet interest. Indeed, it is right that they should be extremely anxious to see that all these people receive the proper consideration. Parliament has always done this in all the railway amalgamations that have taken place, and it certainly is no less right that it should be done now, when they are being welded into a monopoly, than it was before. What one is anxious to see is that every class of person shall be treated fairly. It is true that you do not want to bring in people who have just had an odd job for a few years during the war. On the other hand, it is equally important to see that highly skilled professional people, who may have served for only a year or two with their company, but who may have served four or five years with the Forces in the war, and then come back, have proper consideration. One finds that there is a. great deal of lip-service paid to Service men when the war is going on, but one

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does not find that they get quite such a ready entry where they ought to when the war is over, and they have become ex-Service men. I think it is right that Parliament should be the very careful guardian of their just interests.
The difficulty I see is that however we devise these clauses it is difficult to tell whether we are really covering everything. You may get something wrong, and it can be altered only by an amending Act of Parliament. Then you find something has been left out which ought to go in or something has been put in that you do not like. On the other hand, if you proceed by regulations you get into this difficulty. Owing to the rather archaic system under which regulations are made, if you object to one tiny thing in the regulation, you cannot amend the regulation; you can only reject it. Then it comes up with a Prayer, after it has lain for forty days. Even the Minister cannot make an amendment. He has to take the whole thing away; again it has to go forward; and again lie for forty days. Then someone discovers something else, and there is another Prayer. The inevitability of gradualness applies to this procedure almost more than to anything else.
There is another procedure which we might adopt. The regulations are made in draft, because all these discussions have to take place with representatives of the interests concerned. But they are not the only people. After all, Parliament has a right and a duty in this matter, as well as the trade union representatives, and as well as the Minister. If we pursue this course and say: "Let the Bill go through in its general form; let the negotiations take place, and then let the regulations be laid in draft," that gives Parliament the chance of a detailed discussion on the regulations. Noble Lords can raise this point and that point, and it gives the Minister the chance of answering them and meeting them. Having laid the regulations in draft, and the discussion having taken place; he takes them back; and then, in the light of the Parliamentary discussion on each of the regulations, he makes his final regulations. These, too, come before Parliament and again are subject either to the affirmative approval or negative approval of the House.
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I venture to suggest that that procedure might be followed, because we have already followed it on several occasions in both Houses, and it might be the best way of meeting what are the general anxieties of everybody. I do not myself see that we can go on discussing what must be, to some extent, abstract clauses before we can be satisfied that we are really getting the right protection for people we wish to protect.
THE SECRETARY OF STATE FOR DOMINION AFFAIRS (VISCOUNT ADDISON): I have been giving careful consideration to the suggestion of the noble Viscount, and I should like to say that the decision to approach the matter in the form which is in the Bill was the result of the most careful and detailed consideration. Owing to the fact that these are exceedingly complicated and detailed matters, which must be dealt with here, the only practical way is to deal with them by regulations which will, of course, be made after detailed discussion with all the people concerned, as the noble Viscount has said.
There are some points in the Amendment which is before the House which I am quite sure could not be sustained in any practical shape. But I think there is a considerable substance in the suggestion made by the noble Viscount, although I cannot be held to be in the least committing myself to any final conclusion on the matter. I remember that we had a somewhat similar procedure before, but that is no reason why we should not find a better way of doing this. As the noble Viscount has said, when things are laid before Parliament you have to accept them en bloc or reject them en bloc, which does shut out consideration of detail. All I will say is that I will discuss this with my colleagues with complete good will to see if it is possible to make any use of the suggestion of the noble Viscount—namely, to have regulations in draft which could then, of course, be discussed, rather than in a finalized form. If I am not able to satisfy your Lordships by giving some satisfactory assurance on the Report stage, then, if you so wish, you can return to the case. I must not be understood as giving any pledge, but I will explore it with great good will. I think it is a suggestion which, if the Government can make use of it, will be very useful.
VISCOUNT SWINTON: I am all in favour of that, but I think there is actually some part of this Bill where it is laid down that some regulations are to be laid in draft.
LORD BALFOUR OF BURLEIGH: That is the next clause. I wonder if I might try to clear up one point. I would like some information as to what timing is proposed for the laying of these regulations. I think my noble friend Viscount Swinton suggested that these regulations should be laid now, while this Bill is going through Parliament and before the vesting date. That would be essential.
VISCOUNT SWINTON: No, that would be quite impossible, because obviously negotiations have to take place with all the people who have to be compensated; that is really the difficulty of putting anything into the Bill. The Bill would be passed and negotiations would take place; the Minister would then proceed to draft regulations which would be laid before both Houses, and discussions would take place upon them. In the light of those discussions, the Minister would then lay his final form of regulations to which the House could assent or dissent.
LORD BALFOUR OF BURLEIGH: In those circumstances, I think I would like to make a counter suggestion in rather a different form. Before I do that, I hope your Lordships will allow me to make one or two observations upon comments which fell from the noble Lord, Lord Walkden. While he dealt with great ability and courtesy with my Amendment, I must also say that he filled me with amazement which grew greater and greater as I listened to him. In the first place the noble Lord protested very courteously—but protested—against an Amendment of this complexity being put down at what he called "this late hour in the life of this Bill." Really, I do protest against that. This is the Committee stage in the revising Chamber; and for us to be told that that is a late stage in the career of this Bill, just because the Trades Union Congress have settled everything with the Minister, I call—with the greatest moderation I can command—an outrage.
Secondly, the noble Lord told us that he could not understand why any of your Lordships should put forward an Amendment to improve the status of the rail-
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waymen, because everything is already settled between the trade unions and the Minister. Again, I protest at that. Where is the role of Parliament in this matter? Are we not to be allowed to produce Amendments, which we think right, just because there have been discussions between the Trades Union Congress and the Minister? I think that the noble Lord did not mean to put it in quite that way. I do not want to get in the least hot about it, but I think it may well be that the noble Lord should think again before he puts forward arguments of that sort. The noble Lord made what was no doubt a good debating point about part-time employees and small railway companies. Of course, that is not a point of substance, because I do not think that these small railway companies exist, except on paper. I do not think they have any employees —they have all been absorbed by the big railway companies. I do not think he need worry about the part-time employee. Whatever you do by regulations, you are going to interpret what the Minister has already said.
I am greatly obliged to the noble Earl, Lord Dudley, for calling attention to a point which I had omitted to make. The point is that the Minister has said that his regulations will provide, amongst other things, for having regard to the applicant's prospects of finding alternative employment. If you are starting de nouo, that might conceivably be fair, but you are not starting de nouo. You are starting with an established code, and what filled me with amazement was the attitude of the noble Lord, Lord Walkden, with all his admirable history with regard to railways and trade union leadership. I am sure he will not deny it—he must often have referred to the Third Schedule of the Act as the "Railwaymen's Charter." I think it must have been a Mr. Walkden who invented that particular phrase! If he did not invent it he has certainly used it a hundred times. That is what the Government are seeking to whittle away.
I now come to the proposal which I make as an alternative to the proposal put forward by the noble Viscount, Lord Swinton. I cannot believe that the Government wish to whittle away the established rights of the railwayman. This Amendment goes further, on the question of date, but I will not argue it because I want to put my proposal to the House. Indeed, the Minister has ad-

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mitted that the railwaymen are in a special class, because he said in the course of the debate:
"For the other workers there is no existing code such as obtains in the case of the railway employee."
He admits that there is an existing code. If the Government will say, "We intend to preserve the existing code for the railwaymen," I do not care what the trade unions have agreed or have not agreed. I want to preserve the existing rights which the railwaymen enjoy, and if the Government will say to me: "We agree that we do not want to take away any rights that an existing railwayman has got," then I will withdraw my Amendment, and we will have further consultation and put down an agreed Amendment preserving those rights for the railwayman.
LORD COURTHOPE: Before your Lordships give consideration to the question of withdrawing the Amendment, I should like to raise two points. One is in connexion with the little railways. They do exist, in spite of an opinion expressed by Lord Balfour of Burleigh, for I happen to be a director of two of them, as a representative and nominee of the Southern Railway, of which I am also a director. I want to add this: there are a number of people—I have come across several officers of considerable seniority—who are not convinced or confident that their rights which they have earned by long service and by contribution even are going to be preserved to them in every case. I do not for one moment believe that the Government wish to deprive them of their rights, but it will be well worth while for the Government, and also in the interests of the officers themselves, to give them the assurance that they will not lose the rights which they have at present. I happen to know several officers of some seniority who have reached the age when they can retire and draw their pensions but who have not reached the full retiring age, who are considering withdrawing from the service because of lack of confidence in the treatment they are going to receive. The noble Lord, Lord Walkden, smiles: I know he does not intend, and I know that the noble Viscount who leads the House does not intend, that there shall be any harsh treatment, but if you want to keep the senior
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men in the service, men whom you cannot afford to let go, in my opinion, just at present, it would be well worth while to give them ample assurance that they will not lose any rights which they possess at present.
VISCOUNT ADDISON: I am rather surprised that the noble Lord should have any misgiving on that subject. I cannot imagine that, in the case of any man who has an existing right, there will be any question of that right being taken away.
LORD BALFOUR OF BURLEIGH: But that is what the Bill does.
VISCOUNT ADDISON: No, I do not accept that interpretation. It is true that there is this existing code in the case of the railways and not in the case of the other workers. On the question of time, I am quite sure it will take a long time to work out these regulations. They will be exceedingly detailed and will apply to a large number of persons of different classes and grades and conditions of service. I can quite imagine that there will be very prolonged and detailed discussions with all those concerned before any form of regulation can be put into even a draft form. If your Lordships will look at Clause 101, subsection (2), you will there see that that very fact is anticipated:
"Different regulations may be made under this section in relation to different classes of persons and different classes of transfers,"
and so on. That contemplates that there will be various groups of regulations—it is inevitable that there should be—and they will take a long time in drawing up, I am sure. It is inconceivable to me that anything will be put in these regulations that will take away from any man any existing right. I cannot go any further. If the noble Lord will agree to our looking at Viscount Swinton's suggestion, as has been indicated, I hope that he will think that that is a sensible and practical thing to do. If we can agree on something between now and the Report stage, so much the better; if we cannot, the noble Lord will return to the charge.
LORD BALFOUR OF BURLEIGH: Discussions will take place between now and the Report stage and some attempt will be made to get agreement.
VISCOUNT ADDISON: It is right to point out that it is possible to have regulations in draft for discussion before they are finalized.
LORD BALFOUR OF BURLEIGH: On that understanding, I understand the noble Viscount will have no grievance if I return to the charge possibly with the same Amendment on the Report stage. In those circumstances, if your Lordships wish me to do so, I will ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
6.25 p.m.
Clause 101:
Compensaton to officers and servants in connection with transfers.
101.—(1) The Minister shall by regulations require the Commission to pay, in such cases and to such extent as may be specified in the regulations, compensation—
(3) Regulations made under subsection (1) of this section—

(a) may prescribe the procedure to be followed in making claims for compensation, and the manner in which and the persons by whom the question whether any or what compensation is payable is to be determined; and

(b) may in particular contain provisions enabling appeals from any determination as to whether any or what compensation is payable to be brought, in such cases and subject to such conditions as may be prescribed by the regulations, to a referee or board of referees appointed by the Minister of Labour and National Service,

and where any such provision is made as is specified in paragraph (b) of this subsection, the decision of the referee or board of referees shall be final.
(4) Nothing in this section shall be construed as enabling regulations to be made prejudicing the rights of any person under the Third Schedule to the Railways Act, 1921, or Part VII of the London Passenger Transport Act, 1933.
(5) For the purposes of this section, a body shall be deemed to be completely controlled by one or more other bodies if and only if it is a body with a share capital and no person other than one or more of the following persons, that is to say—

(a) the other bodies aforesaid; and

(b) bodies themselves completely controlled by one or more of those other bodies

has any beneficial interest in any of that share capital which carries voting rights, not being voting rights exercisable only in the event of a default in the payment of dividend.
THE EARL OF DUDLEY THE EARL OF DUDLEY moved, in subsection (1), after "regulations," where that word first occurs, to insert "made before the date of transfer". The noble Earl said: On behalf of my noble friends, I wish to say that the purpose of this Amendment is to ensure that the Minister
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shall make the regulations requiring the Commission to pay compensation to the officers and servants of the bodies transferred to the Commission under the Bill before January 1, 1948, or any other date on which the transfer may be prescribed in the Bill. I am sure you will understand that the compulsory transfer of men from one employer to another always has, and always must have, a very unsettling effect indeed on their minds. I can assure your Lordships that many of these officers and the servants are uncertain as to what is going to happen to them. Therefore, I think it is only reasonable that we should ask the Government to ensure that before a transfer takes place a man should be in a position to know what his rights will be if he suffers a loss of his emoluments or loss of his job or diminution of his emoluments or if his position is otherwise worsened. I think it is only right that not only should he make representations to the Minister in regard to the contents of the draft regulations if they are not satisfactory to him, but his present employer should be able to assist him as well. We have worked together for a great many years, and I am perfectly certain that it would be the wish of these officers and men that they should have the advantage of the help of their present employers—namely, the boards of the railway companies—in looking into these draft regulations. Therefore, I think it is a very reasonable request that these regulations should be drafted before the vesting date, and not after. I beg to move.
Amendment moved—
Page 108, line 19, after ("regulations") insert ("made before the date of transfer"). —(The Earl of Dudley.)
LORD CHORLEY: My Lords, I regret that we cannot accept this Amendment. There are two reasons. I am advised that the Amendment as it stands would finalize the regulations and it would then be impossible to alter them as is contemplated in Clause 2, but that is a matter of construction. Much more important is the argument which was put forward by Viscount Swinton only a minute or two ago, that obviously a great deal of discussion and negotiation is going to have to take place about these regulations; and to suggest that, in so far as the Road Haulage Service, at any rate, is concerned, they can be ready by the end of

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the year is really quite impossible. My right honourable friend the Minister does hope that, so far as the railways are concerned, the regulations will be ready. As has been stated already this afternoon by the noble Lord, Lord Walkden, the Minister did, in another place, indicate the lines on which the regulations relating to railway employees would go, and there is every hope that they will, in fact, be ready and published before the date which the noble Lord has in mind.
I am suggesting to the noble Lord that it would be injudicious to tie us down by a statutory obligation of this kind, which might prevent the very sensible and reasonable negotiations which were going on from being properly terminated, by fixing a date in this rigid sort of way. In these circumstances I hope the noble Earl will withdraw his Amendment.
THE EARL OF DUDLEY: What the noble Lord has said only goes to prove how impossible it would be for the Government to do all they thought to do before the vesting date, and how important it is that the vesting date should be deferred. However, that is a matter which I suppose has already been settled and there is nothing I can do about it. I can quite see the noble Lord's point that it would leave very little time to draft the regulations and get them settled before the vesting date. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD BALFOUR OF BURLEIGH LORD BALFOUR OF BURLEIGH moved, in subsection (1), to leave out the words "in such cases and to such extent as may be specified in the regulations." The noble Lord said: The effect of this Amendment would be to leave out in subsection (1) of Clause 101 the words "in such cases and to such extent as may be specified in the regulations." Here again the intention of the Amendment is to put on the Minister the obligation to pay compensation. Had the new clause to follow Clause 100 been accepted it would have taken the railwaymen out of the Bill. That proposed new clause not being in the Bill I think that it is still important not only for the railwaymen but for everybody else that this matter should not be governed merely by regulations but should be in the Bill. An indication of what may be in the Minister's mind is the fact that he intends
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to exclude everybody with less than eight years' service. My anxiety is mitigated to some extent by the fact that it was agreed to have discussions. I do not think your Lordships would wish to have a long discussion. I take it the noble Lord will take into account the discussion we have had on the proposed new clause to follow Clause 100.
I beg to move.
Amendment moved—
Page 108, line 20, leave out from ("pay") to ("compensation").—(Lord Balfour of Burleigh.)
VISCOUNT MAUGHAM: We do not know what Clause 101 is going to be as a result of the discussions that are going to take place with respect to it. We should be very careful that the words of Clause 101 would not in any way diminish the duties of the Minister under the new Clause 100. That can be dealt with on the Report stage.
VISCOUNT RIDLEY: It is almost impossible to discuss this Amendment without knowing what is to be done about the new clause.
LORD CHORLEY: I entirely agree with what the noble Lord, Lord Balfour of Burleigh, says, that this problem is of the same type as that with which we were concerned a few minutes ago. It seemed to me that the noble Viscount, Lord Swinton, put his finger right on the spot when he said that it is essential that matters of this kind should be dealt with by regulation and not by substantive clauses in an Act of Parliament. But the suggestion that he went on to make, that regulations of this kind were very much better discussed before they were laid, is one which obviously applies equally here, as it did in the proposed new clause. I think the suggestion put forward by the noble Viscount, the Leader of the House, applies here equally well. If the noble Lord will withdraw his Amendment, we will discuss the whole matter.
LORD BALFOUR OF BURLEIGH: On that understanding I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD BALFOUR OF BURLEIGH LORD BALFOUR OF BURLEIGH moved, in subsection (3), to leave out all words from the beginning down to ("question") and insert ("Any"). The

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noble Lord said: These Amendments are consequential. I think they ought to go in because the noble Lord, Lord Chorley, has conceded our whole case, and the result is really a foregone conclusion. If he would like to save time by just putting these in now it would be convenient. If he prefers to reserve the whole thing for consideration later, would it be convenient if I did not move them? Perhaps in the circumstances I will do so, and I beg to move.
Amendment moved—
Page 109, line 22, leave out from beginning to ("question") in line 25 and insert ("Any").—(Lord Balfour of Burleigh.)
LORD CHORLEY: Notwithstanding the winning charm of the noble Lord, I cannot concede that when we agree to look at something we are conceding the whole case. I would ask the noble Lord to agree that the matter, which is consequential under Clause 99, should be dealt with on the same basis.
LORD COURTHOPE: I do not think this is consequential on anything that has gone before.
LORD BALFOUR OF BURLEIGH: It is consequential from the fact that the whole clause is in the melting pot, and I think I had better ask leave to withdraw it.
Amendment, by leave, withdrawn.
6.39 p.m.
VISCOUNT MAUGHAM VISCOUNT MAUGHAM moved, in subsection (5), at the end of paragraph (a) to leave out "and." The noble Lord said: This is a drafting Amendment in order to insert a new paragraph:
"(c) persons holding not more than one share each as subscribers to the Memorandum of Association of the body in question."
The draftsman may be able to explain what is meant by "a body completely controlled by one or more bodies." A long experience in company matters and a vast range of contact with people who sign memoranda of association and who therefore become members of a company, have convinced me that in many cases these people forget. They have as a rule one share each. The Amendment refers only to such people. They do not pay for their share; very often they are clerks of the person who is forming the company; he pays their guinea sooner or later, and they forget all about it. They
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are not beneficial owners, of course, and you often cannot trace them. I have sometimes had cases where it was necessary to get all the shareholders of the company to agree to a particular course, and I have been held up by the fact that we could not get the signatories to the memorandum. I think therefore the Government should accept this very small Amendment.
Amendment moved—
Page 110, line 3, leave out ("and") —(Viscount Maugham.)
LORD CHORLEY: I am obliged to the noble and learned Viscount for pointing out this matter and have great pleasure in accepting his Amendment.
On Question, Amendment agreed to.
VISCOUNT MAUGHAM: The next Amendment is connected with the first one; it is consequential. I beg to move.
Amendment moved—
Page 110, line 5, at end insert ("and

(c) persons holding not more than one share each as subscribers to the Memorandum of Association of the body in question".—(Viscount Maugham.)

On Question, Amendment agreed to
THE EARL OF DUDLEY THE EARL OF DUDLEY moved, at the end of the clause, to insert:
"or in any other special circumstances defined in the Articles of Association of the body in question."
The noble Earl said: I do not think this Amendment is consequential on what has already been discussed on Clause 101—
LORD CHORLEY: If is would save the noble Earl's time, I am very glad to tell him that we can accept this Amendment.
THE EARL OF DUDLEY: I am glad to hear that. Then I beg to move.
Amendment moved—
Page 110, line 8, at end insert the said words. —(The Earl of Dudley.)
On Question, Amendment agreed to.
Clause 101, as amended, agreed to.
6.44 p.m.
Clause 102:
Compensation to officers and servants in other cases.
102. —(1) The Minister shall not regard any scheme as satisfactory for the purposes of subparagraph (1) of paragraph 1 of the Eighth Schedule to this Act, and shall not give his approval to any agreement providing for the

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transfer of the whole or any part of an undertaking which, under any provision of this Act, requires his approval, unless he is satisfied that appropriate provision has been or will be made by the scheme or agreement for the payment in the appropriate cases and to the appropriate extent of compensation to officers and servants who suffer loss of employment or loss or diminution of emoluments or pension rights or whose position is worsened in consequence of the transfer in question.
LORD WALKDEN: This is purely a drafting Amendment. I beg to move.
Amendment moved—
Page 110, line 9, leave out ("any scheme"). —(Lord Walkden.)
On Question, Amendment agreed to.
LORD WALKDEN: This is consequential. I beg to move.
Amendment moved—
Page 110, line 11, after ("Act") insert ("any scheme which provides for the transfer of the whole or any part of any undertaking").—(Lord Walkden.)
On Question, Amendment agreed to.
LORD GIFFORD LORD GIFFORD moved, in subsection (1), to leave out "appropriate provision" and insert "provision in accordance with subsections (3) (4) and (5) of this section." The noble Lord said: There are a number of Amendments to Clause 102 standing in my name and the names of other noble Lords. To be precise, there are seven Amendments, of which I think five can be taken together, and of which the Amendment under discussion is the first of the series. The next one, the Amendment to page 110, line 16, deals with a separate issue, as does also the second one from the bottom of the page in to-day's Marshalled List—namely, the Amendment to leave out "officers and servants" on line 17 of page 110. I think it would be convenient to the Committee if we discussed the five Amendments which go together now. Of course, the main substance of the five is in the last one, page 110, line 26, which is to insert at the end a new subsection.
This series of five Amendments deals with compensation for loss of office of officers and servants. We have heard eloquent appeals on behalf of the railwaymen; and the road transport industry feels that the terms of compensation should be on some definite basis. I imagine that the draft scheme of regulation will also, to some extent, apply in this case. The fact that there is no set basis of com-
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pensation for these officers and servants is unfortunate and we believe it will make these people rather nervous as to their future. The basis of compensation is much too wide at present and should be stated in more definite terms. We consider that there is a very good basis for compensation provided by the Local Government Act of 1933, and these Amendments are so worded as to bring in the provisions of that Act.
It is true to say that nearly all the officers and servants concerned are those employed by municipal operators or company operators, and they are nearly all permanent servants. Many of them are not in fluctuating employment but have been in their employment for twenty, thirty or even forty years. I think we all agree that there should be some minimum period of service, so that it would not be necessary to compensate somebody who had been directed into the road transport industry during the war, and if the noble Lord opposite felt that some minimum period of qualifying service should be made, I think the industry would be quite happy to accept it. We do feel, however, that some definite system or scheme should be settled, rather than that we should adopt the wide and nebulous scheme in this present clause. I beg to move.
Amendment moved—
Page 110, line 15, leave out ("appropriate provision") and insert the said new words.—(Lord Gifford.)
LORD WALKDEN: I take it that there is agreement to the series of Amendments being considered together, as suggested by the noble Lord, and that will be greatly to everybody's convenience. I think in this case he is really asking that road transport operators, and I suppose administrators too, who may be taken over by the Commission should be specially and separately considered, and given standard terms such as have been applied in municipal mergers. Of course, they are rather different from railway mergers. If we take the welding of five small towns into Stoke on Trent, for example, we find that quite a few people were displaced, and of course they were properly compensated. That point will be fairly taken into consideration. But I really cannot accept the long Amendment which is set out in full, because the Commision will undoubtedly be taking municipal people, but they will

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also be taking other people employed by companies who are certainly performing the same functions. They will come under the Road Transport Executive, and they must be considered together. I can assure the noble Lord that due regard will be paid to municipal precedents, and the fairest possible consideration given to everybody who may be adversely affected. We are rather expecting that the reorganization of road passenger transport will lead to a great deal more passenger traffic, and we shall not need to ask anybody to go out of service. That applies also on the administration side. In the meantime, however, it is almost on all fours with the railway case we were discussing a little while ago, where precedents do exist. I ask the noble Lord to withdraw his Amendment, and to reconsider it in the same light. We must work by regulations, and they will be made available in the same way as my noble friend, Viscount Addison, explained to the House a few moments ago.
VISCOUNT SWINTON: Is it entirely understood that the fact that we do not insert this particular provision in no way will be taken to preclude any of my noble friends, when the draft regulations come before us, from saying, "I think you ought to have applied here the old precedent of the Local Government Board Act," or whatever it is? Provided that everything is at large, and the mere fact that what I may call standards or principles are not laid down in the Bill, it leaves the Government free to say: "We want an entirely new standard," but equally it leaves both Houses of Parliament free to say: "We prefer to adhere to the old standard." As long as we know that we all have our rights absolutely preserved, and that none of us will be prevented from criticizing the regulations on their merits, I suggest to my noble friend that he should withdraw the Amendment. But I think that that ought to go on record.
LORD WALKDEN: I can certainly give the noble Viscount the assurance for which he has asked.
LORD GIFFORD: In view of what has been said I shall be happy to withdraw the Amendment. But before doing so I should like to mention one fact which I think is obvious. The case here is not quite the same as that in respect of the railways, because the situation of which
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we have been speaking will not come about until the scheme is made. One other point: we do feel that the officers and servants who entered the service of the road transport undertakings had the right to feel that their security of employment was quite equal to that of the people employed by the municipalities. So we hold that they should not be discriminated against in any way. In view of the assurance which has just been given by the noble Lord, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
THE EARL OF SELKIRK: If I may, I will move this on behalf of my noble friends. I think it is purely a drafting Amendment.
Amendment moved—
Page 110, line 16, after ("payment") insert ("by the transferee"). —(The Earl of Selkirk.)
LORD CHORLEY: To save the noble Earl further trouble I can inform him that we are prepared to accept this Amendment.
THE EARL OF SELKIRK: I am much obliged.
On Question, Amendment agreed to.
LORD GIFFORD LORD GIFFORD moved, in subsection (1), to leave out "officers and servants" and insert "persons." The noble Lord said: In moving this Amendment I should like to point out that there are quite a number of persons who come under the definition of officers and servants in the road transport industry who are not employed by any particular road transport undertaking. In other words they are whole-time employees, but they are not whole-time employees of, we will say, the Southdown Company, or the Midland Red, or any particular operating company. If I may, I will give some instances to show what I mean. Some of the groups of road transport undertakings have a central organization for the purchase of stores. That organization serves several operating companies, but is not directly employed by any one of them. Then there is a central organization for dealing with insurance claims, there is also a chief engineer's department, the workers in which are all employed whole-time by the group bit not by any particular operating company. Now these people might lose all or part of their employment.
For instance, if one or more of the companies which they serve were taken over it might be uneconomic to employ them—at any rate at the salary they were then receiving. Eventually, they would lose their full-time employment though they had never been directly employed by any one particular operator. The purpose of the Amendment is to make sure that this particular class of person is provided for and will receive proper compensation. There is no intention behind these words of bringing in at any time directors or anyone like that. It refers to the whole-time servant, but to the man who is not the whole-time servant of any particular operating company.
Amendment moved—
Page 110, line 17, leave out ("officers and servants") and insert ("persons").—(Lord Gifford.)
LORD CHORLEY: I must confess that I thought that the noble Lord's Amendment was directed to the case of directors. I should have thought, on an off-hand reading of the clause, that the persons whom the noble Lord has in mind were, in fact, covered, because they must be joint employees of the organizations affected. But in case there is any actual doubt about it we will have the matter looked into. Obviously it is a matter on which the legal advisers ought to be consulted. Perhaps if the noble Lord will withdraw his Amendment now we can deal with this matter at the Report stage.
VISCOUNT SWINTON: I think that my noble friend has a good point here. I do not think that these people are joint employees. This is the sort of case that I visualize. Half a dozen companies, motor bus companies perhaps, say "We will not each run a garage or this, that or the other service, but run one to serve all of us," and they probably do it through a subsidiary company. It is a very useful piece of co-ordination and that is a most convenient way of carrying it out. The people who are employed in the garage or whatever it may be are the employees of the subsidiary company which is owned by the half dozen or so motor bus companies. In law, those men are employees of the subsidiary company, and not employees of the different owners of the company. Such a man is employed absolutely full time. If under the Bill
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you take him on, well and good, but if not, he is just as much out of a job as if he were a servant of one of those owning concerns. I think this is a really good point and that it should have attention.
LORD CHORLEY: With deference to the noble Viscount, I should have thought that the company which employed the man was covered. But as I said, this is a matter which ought to be investigated, and I will see that it is looked into.
LORD GIFFORD: It is a fact that technically these men are not employed by any particular road transport undertaking. In addition to the subsidiary company mentioned by Lord Swinton, there is also the case of a holding company which might employ men who would be affected. There are hundreds of cases where men are not really employed by a particular operating company. In view of the assurances which have been given, I beg leave to withdraw the Amendment and I shall not move the other three Amendments on this clause.
Amendment, by leave, withdrawn.
Clause 102, as amended, agreed to.
(The sitting was suspended at seven o'clock and resumed at half past eight.)
Clauses 103 and 104 agreed to.
Clause 105:
Procedure and enforcement of orders of arbitration tribunal.
(2) The provisions of the Arbitration Acts, 1889 to 1934, with respect to—

(d) the costs of the reference and award,

shall, with any necessary modifications, apply in respect of any proceedings before the arbitration tribunal, but save as aforesaid the said Acts shall not apply to any such proceedings.
(3) The arbitration tribunal may, and if so ordered by the Court of Appeal shall, state in the form of a special case for determination by the Court of Appeal any question of law which may arise before them, and the decision of the Court of Appeal thereon shall be final, unless the Court of Appeal give leave to appeal to the House of Lords, which leave may be given on such terms as to costs or otherwise as the Court of Appeal may determine.
LORD MORRISON: The next is a Government Amendment to remove the

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limitation of the right to appeal at present imposed by the clause. I beg to move.
Amendment moved—
Page 112, line 43, leave out from ("them") to the end of the subsection.—(Lord Morrison.)
On Question, Amendment agreed to.
Clause 105, as amended, agreed to.
Clauses 106 and 107 agreed to.
Clause 108:
Jurisdiction of arbitration tribunal as to disputes.
108. —(1) Subject to the provisions of this Part of this Act, the arbitration tribunal shall have sole jurisdiction to determine any dispute to which the Commission is a party as to any of the following questions that is to say—

(c) whether a notice of disclaimer given by the Commission under any of the provisions of this Act with respect to any property or any contract or agreement is or is not valid; or

(d) any other question required by any provision of this Act to be determined by the arbitration tribunal.

LORD MORRISON LORD MORRISON moved, in subsection (1), to leave out paragraph (c) and insert:
"(c) whether the acquisition of any property, or the making or variation of any agreement or contract with respect to which a notice of disclaimer is given by the Commission under any provision of this Act, was or was not reasonably necessary for the purposes mentioned in that provision, or was or was not an act of unreasonable imprudence on the part of the body or person therein mentioned;
(d) whether any such notice of disclaimer is in any other respect invalid; or".
The noble Lord said: On behalf of the noble Viscount, Lord Addison, I beg to move this Amendment. During our previous debate the noble and learned Viscount, Lord Simon, suggested in an Amendment which was afterwards withdrawn that the only appeal to the Transport Arbitration Tribunal on the question of a disclaimed contract was on the form in which the notice had been given, and that in consequence they had no jurisdiction On the question of the necessity or imprudence of the contract. The Government fully accept the principle that the Arbitration Tribunal should have this complete jurisdiction, and the draftsman is satisfied that on the clause he is drafting this jurisdiction is there. In view of the doubts expressed by Lord Simon, this Amendment is put down for clarification.
Amendment moved—
Page 115, line 23, leave out paragraph (c) and insert the said new paragraph.—(Lord Morrison.)
LORD WOOLTON: We are very much obliged to the noble Lord.
On Question, Amendment agreed to
THE EARL OF ROTHES THE EARL OF ROTHES moved, at the end of the clause to insert the following subsection:
"(3) Where a scheme made under section 62 of this Act constitutes or specifies a body or bodies for the purpose of providing passenger road transport services operating within or partly within the area of the scheme, and constitutes or specifies the body or bodies who are to administer or to take part in administering such scheme, references in this section to the Commission shall be deemed to include references to such body or bodies as the case may be."
The noble Earl said: This is really a clarifying Amendment. Clause 108 deals with jurisdiction of Arbitration Tribunals and only names the Commission, whereas under Part IV and the Eighth Schedule reference is made to "a body or bodies" who may or may not constitute a scheme. It might appear that they might be responsible in that case for compensation. I venture to suggest that this subsection might be included to make it quite clear that "bodies," so far as compensation is concerned, includes the Commission.
Amendment moved—
Page 115, line 35, at end insert the said subsection.—(The Earl of Rothes.)
THE LORD CHANCELLOR: I appreciate what the noble Earl desires, but—if he will forgive my saying so—the Amendment does not carry out his desire. You need here, if you are to apply this to other than the Commission itself, first, some words to get over the difficulty of the phrase which comes repeatedly in Clause 108, "under any provision of this Act"; and secondly, something which makes it plain that you are not dealing with the Commission but with a body which may be set up under a scheme. You have to have both these things. The Amendment, which is no doubt intended to give to the Arbitration Tribunal sole jurisdiction over disputes between the body or bodies set up under the Provisions of a scheme, and any other party, does not in fact achieve that object. It would merely substitute "reference to body or bodies" for "reference to the Commission," but it would leave standing untouched the other conditions limit-

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ing the jurisdiction—namely, that the only questions which the Arbitration Tribunal had jurisdiction to decide are questions arising "in respect of the transfer to the Commission, under any of the provisions of this Act." There is no reference to transfer under the provisions of a scheme. The object of the Amendment I venture to think has been more happily dealt with by Clause 112 and the noble Earl will see that in Clause 112 we have endeavoured to meet both these difficulties.
We say there:
"Any reference in the preceding provisions of this Part of this Act to any provision of this Act includes a reference to that provision as applied, with or without modifications, by any scheme or order."
That is the first point. It goes on:
"and, except so far as the contrary is expressly provided by the scheme or order, any reference in this Part of this Act to the Commission shall, in relation to a scheme or order providing for a transfer to a body other than the Commission, be deemed, in relation to that transfer, to include a reference to that body."
So that we have there dealt with both the necessary points. It is quite true that we say, "except so far as the contrary is expressly provided by the scheme or order." That we have done quite deliberately. There may be cases where some other system is desirable. Subject to that point, we have met—and I venture to think that the noble Lord's Amendment does not meet—both the necessary steps to enable this scheme to be applied to the body acting under the scheme instead of under the Act. For that reason, I regret I am unable to accept this Amendment.
LORD WOOLTON: I am sorry the noble and learned Viscount feels like that about the Amendment. As I am advised, this is an Amendment which we thought the Government were going to accept. We thought it arose directly out of Clause 68 in the Bill.
THE EARL OF ROTHES: I do not want to press this Amendment, and, of course, I bow to the superior knowledge of the noble and learned Viscount. I will withdraw the Amendment for the time being, and if I am advised otherwise I will refer to it later.
Amendment, by leave, withdrawn.
Clause 108, as amended, agreed to.
Clauses 100 to 112 agreed to.
Clause 113:
Additional compensation to local authorities.
(2) The undertakings to which this section applies are—

(a) any undertaking of a local authority which falls to be transferred under Part II of this Act;

(b) any undertaking which, at the passing of this Act, is being carried on by a local authority, being an undertaking which could be transferred to the Commission or to some other body as aforesaid under a scheme under Part IV of this Act;

and the expression "the appropriate sum" means, in relation to any undertaking to which this section applies, such sum as may be specified in relation to that undertaking by regulations made by the Minister, so, however, that the total of all the appropriate sums for undertakings the activities whereof consist wholly or partly of operating passenger road transport services does not exceed two and a half million pounds and the total of all the appropriate sums for other undertakings does not exceed two hundred thousand pounds.
THE EARL OF SELKIRK THE EARL OF SELKIRK moved in subsection (2) to leave out "regulations" and insert "orders." The noble Earl said: This clause deals with the additional compensation payable to local authorities. I have put down an Amendment which provides that those who are particularly interested in this sum should have the opportunity of representing their case. If the Government feel they cannot accept this Amendment, then I think the alternative is that they must explain the basis on which this additional compensation to local authorities is to be paid. I am going to put one or two questions to His Majesty's Government, and if they can answer those questions, I do not propose to press this Amendment. The first question I want to ask is: How is the global sum of £2,500,000 arrived at? I ask that question because it is very important to realize that the sum of £2,500,000 does not approximate in any way to the value of the transport undertakings which are to be taken over.
I have not here a figure showing the exact value of all the transport undertakings which may or may not be taken over, but I will give your Lordships those of a relatively small city of half a million people—the city of Edinburgh. That has a transport undertaking the value of which is £4,500,000, and the outstanding debt, if taken over, is about £150,000. That means to say that the payment to

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be made for it is very small indeed. The second question I want to ask the Government is this: What is the basis of allocation of this £2,500,000? I understand that there has been some suggestion that 1 per cent. of the receipts will be paid for six years. I do not know whether that is true or not. This is essentially to cover those incidental expenses and in particular the overhead expenses which Will arise for local authorities from the severance of their transport undertakings. The question of the recovery of income tax also arises in that regard. I should very much like to have a reply on that point.
The third point I want to make is whether any consideration is being given under this head to special circumstances. I want you to know quite clearly what the special circumstances are which exist in certain cases. The special circumstances to which I wish to refer are in regard to the city of Glasgow. There a situation exists which I think is unique in, the whole of the United Kingdom, because the transport undertaking in the city of Glasgow does not belong, in the ordinary sense of the word, to the Corporation of Glasgow but belongs to the common good. I will support that by referring your Lordships to the Glasgow Corporation Act, 1909, and in particular to Section 20 of that Act, which says that the tramway undertakings of the Corporation shall be, and shall be deemed to have always been, part of the common good of the city.
Now what is the common good? The common good is perhaps a phrase which is unfamiliar in England, and it may be that some of your Lordships are not familiar with exactly what it means. The common good, if I may put it in very simple language, is a trust of which the citizens of the city are the beneficiaries, and of which the town council are the members. What are the obligations which apply to the trustees in relation to the trust which they administer? Their relation's in fact are entirely different from those which exist in regard to an ordinary corporation dealing under an Act of Parliament with a transport organization. Their duties are to see that the moneys, or the funds placed at their disposal, are used in a manner which is beneficial to the whole of the citizens of Glasgow.
Now I understand the method in which it is proposed to take over these transport undertakings is as follows. The transport undertaking is still private, although the ratepayers are in exactly the same position, as they were before the change. In the case of the common good, you are dealing in fact with a trust which could have invested some money in any form of company or enterprise they desired. The effect of this Act is to deprive the citizens of Glasgow of a sum of about £10,000,000. The value of the transport undertaking is closely approximating to £10,000,000, and they are being paid for that the sum of £200,000. This is a point which His 'Majesty's Government have to answer, because it is not the case of an ordinary transfer between a local authority undertaking and His Majesty's Government—that is to say, a transfer from a local to a central authority. It is, in fact a transfer from the common good, which is something entirely different. I am asking His Majesty's Government if they would be good enough to explain what their view is, because this is something which is deserving of special consideration. For these reasons, I ask His Majesty's Government either to accept this Amendment as it stands, or to offer a full explanation in regard to the three questions I have posed—that is to say, how the global sum is reached; how it is proposed to allocate it, and whether or not special consideration will be given to certain cases. I beg to move.
Amendment moved—
Page 117, line 31, leave out ("regulations") and insert ("orders").—(The Earl of Selkirk.)
LORD SALTOUN: I would like to say a few words on the last point in support of my noble friend. I do not know if I should declare an interest, but I must confess to your Lordships that I am a burgess of the City of Glasgow. For those of your Lordships who are Englishmen, I would suggest that, if you want to find out more about the common good, which is important in Scotland, you should read that very amusing book called The Provost, by John Galt, which shows the various efforts made by the magistrates and corporation of the burgh in the 18th Century to appropriate to themselves the portions of the common good of the burgh to which they were entrusted.

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The common good—and it has various forms—exists in a great many burghs in Scotland, and has a considerable public value. It often enables the burgh, not through the corporation but through the managers of the common good, to undertake works which are for the advantage of the citizens and which they may not be able to undertake under the Local Government Acts which govern the corporation. The property of these common goods is in the hands of trustees, and under the management of trustees, and they are mostly governed by their ancient charters which were nearly always made on liberal and advanced terms. It would be a very serious blow to Scottish social life if this Bill were to deal a blow at the common goods of the various burghs of Scotland, especially in such a signal case as the great and important City of Glasgow; it would be a very unfortunate thing indeed. I am sure that every consideration will be given to the common good of the City of Glasgow and that the people, under this Bill, will not lose anything that they might reasonably expect to receive because the circumstances should not be considered by the Government special, as my noble Lords on this side of the House consider them to be.
LORD MORRISON: I am afraid I am not in a position intelligently to enter into the detailed discussion about the common good, even after the eloquent appeal of the noble Earl. I was not aware that he is a burgess of the City of Glasgow. If there had been any mention or indication that a specific point intended to be raised in this Amendment was to be connected with the common good of the city of Glasgow, I should have made myself, to the best of my ability, acquainted with the particular circumstances. The answer to the question raised by the noble Earl, Lord Selkirk, is in the main that this plan or scheme that is proposed—the distribution of the £2,500,000 to which he has referred and the fact that the amount was fixed at £2,500,000—was decided after negotiation, and the whole proposal was changed after negotiation between the Association of Municipal Corporations and the Association of Counties and Cities of Scotland, who actually informed the Government that, in point of fact, they saw little likelihood of agreeing amongst themselves as to the allocation of the
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total sum. They themselves pointed out that this way, as indicated in the Bill, was the only way by which an equitable distribution was likely to take place or likely to be agreed amongst all of them.
The Minister, I may inform the noble Earl, has given a most explicit undertaking to the Association of the Municipal Corporations and to the Association of Counties and Cities in Scotland that in passing the regulation he will consult with these Associations with a view to arranging an equitable distribution of the global sums amongst the individual authorities. When a global sum of this character is involved, the principles of distribution must be agreed and there is no one who can agree these better than the Associations of the local authorities concerned. This is the reply to the further point raised by the Earl: if at some subsequent date some individual local authority were to seek, through special parliamentary procedure, a bigger share for itself, this could only be at the expense of all the other authorities. A share-out of this character is a matter for agreement between representatives of local authorities, with the Minister holding the ring as an administrative matter, and is quite inappropriate for special parliamentary procedure. In these circumstances, I regret I am unable to accept the Amendment.
LORD RANKEILLOUR: Is this not a case that comes under the tentative agreement made with regard to regulations earlier to-day? The noble Earl, Lord Selkirk, wants special parliamentary procedure, but the Bill says this is to be done by regulation. The system of regulations has already been shown to possess the great disadvantage that you cannot amend a regulation, though you may annul it. I should have thought that this was a case for investigation, together with the other matters which have been referred to—particularly by the noble Lord, Lord Balfour of Burleigh—and that the arguments that apply to what he put forward, and which the noble Viscount the Leader of the House agreed should have further consideration, would equally apply in this case.
LORD SALTOUN: I recognize that the noble Lord cannot answer now, by reason of the fact that, strictly speaking, the tramways of Glasgow do not belong to the local authority but to the common good; but they should not be deprived of any-

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thing merely by reason of the fact that the owners are not perhaps considered legally a local authority.
LORD MORRISON: If I had thought the noble Lord intended to raise the specific point of the Common Good Fund of the City of Glasgow, I would have fortified myself accordingly. May I just say further to the noble Lord who asked the specific question at the beginning how the £2,500,000 was arrived at, that it was the result of negotiations with the Association of Municipal Corporations. It was agreed that it was only possible to arrive by statistical methods at an over-all figure to represent compensation due by reason of severance. The figures taken represented about 1.25 per cent, of the gross receipts of municipal transport undertakings. That was agreed as a fair figure for overheads which the local authorities might be unable to eliminate.
LORD RANKEILLOUR: Will the noble Lord say something more about this question of regulations? An agreement to discuss further the whole subject of these regulations was made earlier in the day —or at any rate a proposal was put forward in all these cases. It might well be considered whether the draft regulations, which could be altered by either House of Parliament, should not be agreed upon. I should have thought that that was eminently a case for the same procedure as that adumbrated at an earlier stage to-day.
LORD MORRISON: I thought I had pointed out that the Government took the decision that this matter could best be settled by negotiation with the Association of Municipal Corporations in England and the similar body representing the municipalities of Scotland.
VISCOUNT SWINTON: I do not think that is necessarily in dispute. That really is not the answer to my noble friend's question. I am sure negotiations have to go on over this, but ultimately what is the issue here is the distribution to a number of Scottish beneficiaries of a certain sum. They are not satisfied with the sum. They have no doubt been unjustly treated.
VISCOUNT ADDISON: Not at all.
VISCOUNT SWINTON: It would not be practical for us, I agree, to move that they should get a more equitable share.
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On the other hand, when the sum is distributed, I do not envy the Government and the Secretary of State who start distributing an inadequate sum of money to a number of Scottish beneficiaries. But when the Minister has attempted that extremely invidious task and has put the thing into regulations, will the regulations come before this House for an affirmative or negative resolution in the same way that other regulations will? If so, there will be, I have no doubt, the representation of all the other Scottish beneficiaries in regard to these regulations. That is really the answer we want.
VISCOUNT ADDISON: Those regulations will certainly be dealt with just as is every other regulation. With regard to the special point made by Lord Rankeillour, with regard to a special provision in an Act of Parliament relating to the compensation of railway employees, I should not have thought myself that the details for negotiation to which the noble Lord has made reference would be the sort of details which we should want to discuss in draft regulatons. I sincerely hope that the noble Lord will not press that particular point with regard to these regulations.
VISCOUNT SWINTON: Provided the Government definitely come before both Houses of Parliament for judgment and have to give an account of their stewardship in regard to the common goods and others, then I think it is sufficiently met.
VISCOUNT ADDISON: We have tried to follow this complicated Bill as best we can.
VISCOUNT SWINTON: We are all learning it, including the noble Viscount the Leader of the House.
VISCOUNT ADDISON: As my noble friend has pointed out, if you lock at page 120, Clause 118 (2), you will see that the regulations will come before the Houses of Parliament.
VISCOUNT SWINTON: Yes, I agree.
LORD RANKEILLOUR: Will they lie for the forty days?
VISCOUNT ADDISON: Yes.
THE EARL OF SELKIRK: The noble Viscount has said that the regulations will come before the Houses of Parliament,

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but as your Lordships know, there is only one way of dealing with those regulations, and that is to negative the whole lot. That is clearly impossible in this case, and the procedure which I propose allows for certain amendments and alterations to be made, and I think in that sense it is far more appropriate. The noble Lord, Lord Morrison, has replied in a way, if I may say so, to my first two questions. He has said that the global sum was arrived at by negotiation with the municipal associations and the counties and cities of Scotland. I have no evidence of that, but I am sure the noble Lord is right. But whether they are really satisfied is a different matter, if I may say so with great respect to the noble Lord.
The second point, in regard to the way in which they are to be allocated, he has not attempted to answer in the way it should be answered. The third point is whether any special consideration can be given to certain cities, in particular the City of Glasgow, which I have mentioned, and that question the noble Lord could not answer. I say, with great respect, that the Government must have known perfectly well that this question was coming up on this Amendment, because it was before the Ministry of Transport. It is perfectly obvious that this clause would need consideration. This is the only clause in the whole Bill which deals with the question of a contribution to local authorities. It must have been perfectly clear to the Ministry that this point was coming up, and I am very surprised indeed that the noble Lord has not been adequately briefed. However, there is nothing new about that particularly, and I am not complaining unduly on that point.
The noble Lord has said that this is a question of equitable distribution between the municipalities. I suggest that the best way to distribute equitably is to make arrangements behind the scenes and thereafter to allow presentation before Parliament. That can be permitted under special Parliamentary procedure for special cases when they arise. These local authorities are very powerful indeed, and I feel that they would be more satisfied if they were allowed to be represented by counsel before Parliament in dealing with a matter in which they feel they are so intimately concerned. I must ask the noble Lord to consider this point and the
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other points that I have mentioned before the Report stage. If the noble Lord is prepared so to consider this point, I am ready to withdraw this Amendment.
VISCOUNT ADDISON: I cannot promise to consider a suggestion that local authorities should appear by counsel before this House to dispute details of this allocation. I think that it is an extraordinary suggestion.
THE EARL OF SELKIRK: With very great respect, I did not make such a suggestion. I suggested that special Parliamentary procedure which is entirely different should be allowed under this Bill. That is, that they should appear by counsel before a Select Committee of this House, which is something entirely different.
VISCOUNT ADDISON: I think that Clause 118 shows clearly what will be dealt with, and, frankly, I consider that these powerful local authorities are perfectly capable of stating their own cases. I suspect, though, that they think they have been treated with extraordinary generosity. I think they have made a very good bargain.
THE EARL OF SELKIRK: I assure the noble Viscount that that is not the case with regard to Glasgow, which is peculiar for the reason I have mentioned. I ask leave to withdraw the Amendment, but may I say that I shall expect some explanation of the view of His Majesty's Government with regard to the common good of Glasgow before the Report stage.
Amendment, by leave, withdrawn.
Clause 113 agreed to.
Clauses 114 and 115 agreed to.
9.4 p.m.
Clause 116 [Special provisions as to River Lee]:
LORD WALKDEN LORD WALKDEN moved, at the end of the clause to insert:
"(4) Until the appointed day and save in so far as may be otherwise agreed between the Commission and the Lee Conservancy Catchment Board, the said Board—

(a) shall, as agents for the Commission, carry on that part of the undertaking of the Commission which corresponds to the undertaking of the Lee Conservancy Board, and for that purpose, have all such rights and powers as are transferred to the Commission from the Lee Conservancy Board by this Act; and

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(b) shall, as respects the carrying on thereof, give effect to any directions as to the exercise of the said rights and powers which may front time to time be given to them by the Commission; and

(c) shall, to such extent as may be agreed between them and the Commission or as may, in default of agreement, be determined by the Minister and the Minister of Agriculture and Fisheries acting together, be entitled, on payment of such sums to the Commission as may be so agreed or determined, to make use, for the purposes of their own undertaking, of the services of officers and servants employed and property held by the Commission for the purposes of the said part of the Commission's undertaking."

The noble Lord said: This rather long Amendment, with its different subsections, is intended to augment the provisions contained in Clause 116 with regard to the Lee Conservancy Board and the Lee Conservancy Catchment Board, also the provisions in the Twelfth Schedule which deal further with adjusting the position of the Boards. The Conservancy Board is being taken over by the Commission for the purpose of utilizing its navigational facilities. But there have been other functions which the Conservancy Board have discharged, and there are to be regulations made for placing them under the Lee Conservancy Catchment Board. These functions relate to water supply, fisheries, polution, and land drainage, and when the regulations are made in regard to those matters they will be made jointly by the Minister of Transport, the Minister of Health and the Minister of Agriculture, so that all interests will be represented together when the regulations are made. The Amendment now before the House is to augment that and to provide arrangements for the transitional period. It is unlikely the Commission will be able to take over and operate this yet. They will have to appoint a Waterways Executive and a scheme has to be made for operating inland waterways; and that may take some time. In the interval there has to be an interim arrangement and this Amendment provides for that. The functions of the Conservancy Board can be carried on meantime by arrangements under this clause, and when the Commission are ready to step in and take over they will take over the whole "caboodle" and carry on.
VISCOUNT SWINTON: Is that expression in the definition clause?
LORD WALKDEN: It is all perfectly clear. It renders quite unnecessary another arrangement suggested, whereby the original authority carried on in perpetuity under the æis of the Commission. The Commission will eventually carry on the functions itself. I beg to move.
Amendment moved—
Page 119, line 41, at end, insert the said subsection.—(Lord Walkden.)
VISCOUNT FALMOUTH: My Lords, I have to declare an interest in this undertaking because I happen to be a conservator in what I now know to be a "caboodle." We had a discussion on the position of the River Lee on Clause 12 and I explained to your Lordships then that the Lee is a small river but extremely important, because it supplies water to the Metropolitan Water Board which, in turn, supplies water to a large number of the inhabitants of the East End of London. The Lee Conservancy Board are charged with the supervision of the purity of the water. They employ a number of experts on the river, constantly taking sample to see that the purity of the river is maintained. In addition to this important work, there is a certain amount of transport. It amounted in the best year, 1938, to 2,000,000 tons, but that transport only brought in something like £28,000. The haul is very short and a great deal of tonnage is actually hauled without paying any dues. This is relatively a small undertaking in regard to transport from the point of view of income, but it is an extremely important undertaking in view of the duties laid upon it in protecting the water for the East End of London.
This clause seeks to split the activities of this Board. It seeks to transfer the navigational duties of the Lee Conservancy to the Transport Board and to transfer to the Lee Catchment Board the duties of supervizing the purity of the water and maintaining the flow from the river. That is a functional division which is quite impossible on this particular river. It makes all sorts of difficulties. For example, you have at the present moment one general manager running the Catchment Board and Conservancy Board and you have one engineer in charge. The two Boards are composed largely of the same members, though the Catchment Board, a much newer body established under the

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1930 Act, have a few more members because their activities extend over a considerably wider area. I submit to your Lordships that it would be fatal to try and do away with the Lee Conservancy, to put the water supervision under the Catchment Board, and to let the Transport Board undertake the navigational duties. The water in which the barges move is, of course, water that eventually goes into the reservoirs, and it is, therefore, the responsibility of the Conservancy Board to maintain its purity.
Again, let us consider the locks. The locks on the River Lee are required for transport, but the weirs alongside the locks are required for flooding purposes. I submit to your Lordships that it is quite impossible to separate those two duties. At the present moment you have lock-keepers on the various locks, who attend to the sluices, which are to be transferred to the Catchment Board; at the same time they open the lock gates, which are to be transferred to the Transport Board. The whole scheme as proposed will, I am afraid, be very difficult to work. It will mean that you will now have to have two general managers, two engineers, and two workshops, because at the present moment the workshops of the Lee Conservancy and the Lee Catchment Board are combined, and they carry out more or less the same duties. This will, in consequence, greatly add to the expense and it will mean that the various ratepayers in the districts through which the Lee passes will have to bear this extra burden, which is quite unnecessary and is only brought about by this splitting of these functions.
I hope your Lordships will give consideration to the Amendment which I am moving subsequently, and perhaps if I deal with that now it may save the time of the Committee. I suggest, in that Amendment, that the Lee Conservancy Board should be made agents for the Commission, so far as the Transport undertaking of the Lee Conservancy Board is concerned. That in no way contradicts this Bill, because Clause 2, (2) (f), states that the Transport Commission can appoint any body to act as agents, should they so desire. All I am asking is that the Lee Conservancy Board should be made agents for the transport undertaking, so far as their navigational duties are concerned. In that way I think all
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these difficulties will be avoided. The undertaking would be carried on smoothly and efficiently, as it is at present, and at the same time full advantage can be taken of the successful management which we have at the present time.
LORD CROFT: May I briefly support the Amendment of my noble friend Viscount Falmouth? We were hoping that something much more definite would arise out of the previous discussion to-day. It so happens that I have been closely associated with the River Lee from my earliest childhood. I have no private interest in it, but lots of affection for it, and, I have seen the workings of that river, because my grandfather was a conservator, and my father for many years was the Chairman of the Conservancy Board. I entirely agree with every word that has fallen from my noble friend. To divide these functions would be a real mistake. It is such an efficient and well-run organization, and it comprises so many functions which cannot be divided up, that I hope His Majesty's Government will think again.
I have made a great deal of use of that waterway for some forty-four years. It is indisputably linked up with the question of London's water supply and with the whole of this catchment question. There again, I happen to have some knowledge, because as a property owner in the neighbourhood I realize how important it is for the purity of the water to be maintained. From every angle I would urge the Government to treat this as they are treating the Thames Conservancy, and not to embrace the River Lee in the whole "caboodle." You must realize that you are effecting no useful purpose whatever in this way, whereas you will achieve everything you want if you make the Lee Conservancy your agents. Why double your officials for all these various functions when the whole thing is being so efficiently carried out? I hope the noble Viscount the Leader of the House will think again on the question. You do not want to swallow everything because you are in a greedy frame of mind.
VISCOUNT ADDISON: I can assure the noble Lord that we are not in a greedy frame of mind at all. I think your Lordships have lost sight of Clause 12. We had a discussion on Clause 12, and it was arranged that we should try and put an Amendment on the Paper later to give a

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picture of the sub-division of functions. This Amendment has been worked out very carefully to fulfil that promise, and I thought we were doing a good deal to give effect to our undertaking in that way. I would point out to the noble Lord who has just spoken, and to the noble Viscount, that if you look at the subsection you will see that the Lee Conservancy Catchment Board shall act as Agents for the Commission during this time and that any prevailing scheme which may be in operation on the appointed day—
VISCOUNT SWINTON: What is the appointed day?
VISCOUNT ADDISON: That will be for them to work out. I cannot tell you when the appointed day will be. It will be when the scheme has been drawn up for these waterways. It is impossible to say to-day when the appointed day is to be. I only want to point out that this Amendment is in pursuance of an undertaking given when we were discussing Clause 12, and I think that it carries out that undertaking in a very practical and sensible way. I hope your Lordships will not want to repeat the discussion or go back on our previous discussion.
VISCOUNT SWINTON: The noble Viscount the Leader of the House is always so persuasive, and I am sure he has done his best. I am equally sure that he can do better! I was perhaps unduly forthcoming on the last occasion, but we did agree that all our rights under Clause 12 were reserved. We passed from Clause 12 on the understanding that if we could get an adjustment under Clause 116 and the consequential Schedule, then Clause 12 could be recast on Report, but if we were not satisfied then of course we must come back to it. I really feel that there is not very much between us here. I am sure the noble Viscount will agree that it is difficult to master all the details. I know it has been difficult for me; I have had to work on this Bill for six months. I have not the noble Viscount's responsibilities, but I find it difficult enough to understand it and follow it.
I hope we need not have a controversy where I believe we could all be at one. Let me hasten to say that I have no personal interest in this great undertaking, other than as one who consistently uses the London water to wash in and also,
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from time to time, to drink. Quite frankly, last time I was entirely taken in by the noble Lord, Lord Walkden, who made a most eloquent speech about the future. I am just going to say a word or two to him about it, because I took it all at its face value last time, but in the interim I have been making some inquiries. He said he wants to take ever "the whole caboodle"—a term not known to me in an Act of Parliament. If he wanted to be really classical I suggest he should have said "Uncle Tom Cobley and All" as being more hallowed by the Parliamentary meed of approbation. What happened last time? The noble Lord, having paid a tribute to the efficiency of the Lee Conservancy, and having told us that there was an immense amount of traffic upon the Lee, was rather careful not to specify what part of the Lee that traffic was on. I understand, in fact, that what happens is that where the Lee goes down near the docks it does carry an immense amount of traffic, just by its mouth, but where we get our water from there is nothing at all or very little—one horse a day, or something like that.
I venture to ask: Has the noble Lord been there? Will he really find all this vast amount of traffic? I asked him about ton mileage; he did not like the phrase—he liked "caboodle" better. If he takes the time, he will find that the whole of this tonnage, which is very large, is just where the river joins the docks. Lord Croft will correct me if I am wrong. For generations he has lived on this thing—I deliberately use the phrase "on it" and not "off it." I am told that when you get up to Enfield every now and again you see an old horse dragging along a canal barge. I believe now it is even doubtful whether you see that, because somebody—probably the Government—has introduced some wretched Bill which prevented the bargees coming on the canal and sent them all to school or into a trade union. Last time the noble Lord, Lord Walkden, completely bamboozled me—if he will forgive me for using that term—by a picture he drew of some enormous trans-English waterway like a great Rhine canal connecting London with the Wash. I am a most innocent person, and I took it all at its face value; I was not asked to put any money into it—no more than I as a taxpayer have to put into this undertaking—but I have

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been inquiring into it and I am told that all that is the greatest nonsense, and that no one in his senses, or even out of them, will ever contemplate driving this extraordinary Rhine-Maas canal across England. If you attempted to do it, you would upset the whole of the drainage and water levels of England, and, after you had done it, no traffic would want to go from the Wash into London anyway. Really, I do not know where he obtained his information but the noble Lord must have been reading the wrong brief; it certainly bears no relation to the facts and no relation to reality.
What have we here? It is admitted that we have an admirably conducted undertaking. The intense traffic which goes along at the end of the river goes along perfectly well, and there is nothing mysterious in keeping a perfectly good, constantly operated canal open; and by all means let the Commission own the barges which run along that canal. What they want is a road to run on. If the noble Lord wants to swallow the undertaking, let him eat the barges which are to go along the canal; let him carry the traffic along it; but why should he want to drink the water as well? He does not want to take over the roads because he confiscates all the transport that runs along the road; he is content for the time being to leave the roads under the control of the Minister of Transport and the local authorities.
As regards the Lee, it is an extremely complicated business—this business of seeing that the water levels keep right and that the water keeps pure. The drainage and maintenance of water levels, and dealing with flood water, is all very difficult. When we had those frightful floods some time ago the water supply was contaminated. It was bad enough then in an emergency, but there was one set of people to deal with it, and I understand that they dealt with it rapidly and competently, and had the water pure. But that is a terribly complicated business. People who are accustomed to running it and who know it, were running it. It is exactly like running a complicated machine. Your Lordships know the difference between having an amateur and having someone who really knows the job. If you know a horse, when you take him over a jump
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you know just what he will do. With engineers it is much the same. Why cannot we leave that great undertaking alone? We want a great deal more water in London.
The noble Lord beats me. When you come to some things he is so conservative that he will not change the views he formed seventy years ago; but when he comes to something else, about which he knows nothing, he wants to change it all! I suggest that the whole of this great undertaking should be left in the hands of the Lee Conservancy, not as an agent in consultation, nor only until the appointed day. I do not know when appointed day is. It may be the Resurrection Day or it may be to-morrow morning. Why do you not do the sensible thing? That is the sporting offer I make to the Government. Leave well alone. Take over what you regard as your genuine business under this Bill and run it; but leave the rest of the work to the River Lee people to run. They will see that the water comes down to the end of the river, you need not worry about that. The barges will not be left high and dry. It will not be the water that will stop running when the Government take control of it, it will be the transport. Leave it to the River Lee people. Let them conduct the enterprise which they are now conducting to everybody's great satisfaction. They are a nonprofit making body, a public authority, with everybody's good will.
If you find, some time in the future, that the Commission want to do something else, let them come to Parliament with an order making a change, and with an affirmative Resolution. I submit that this is a sensible proposition and a sporting offer. Do not make unnecessary enemies. If we have to have this Bill, let us pass it with as much good will as we can find, and with all the competent allies we can secure. If you will only accept the proposition I am making to you now, you will keep the good will of the Lee Conservancy, you will run your transport all right, and you will make a friend instead of one more fellow who will vote against you at the next election.
VISCOUNT ADDISON: In response to the noble Viscount's statement, may I say that I really think that he should read the clause. We are not proposing

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that the Commission shall take over the water supplies and the functions of the Catchment Board. If he will look at subsection (2) of the clause he will see that it says there:
"Notwithstanding anything in the said Part II the functions of the Lee Conservancy Board, so far as they are declared by regulations made under this section to be functions relating to water supply, fisheries, pollution or land drainage to which it is expedient that this subsection should apply, shall, in lieu of becoming exercisable by the Commission, become exercisable by the Lee Conservancy Catchment Board."
In other words, we do the very thing that the noble Viscount wants us to do; it is in this clause. All I have to say is that I put down this Amendment in complete good faith. You have spoken of functions and what was to be done in the interval. The division of functions is prescribed in the clause. If the noble Lords do not want my good will Amendment, very well. I do not want them to have it, and it will not be in the Bill at all.
LORD WOOLTON: I do not want to prolong the discussion, but I wonder whether the Leader of the House has appreciated this quite simple fact: that this Amendment begins with the words, "Until the appointed day." That is the difficulty. After that you can do as you like. It is that one phrase, those few words, that seem, to me to vitiate the whole of the rest of the offer.
VISCOUNT ADDISON: You should pay attention to the Bill. It says that: "notwithstanding anything," these functions will continue to be exercised by the Lee Conservancy Catchment Board. We are separating the functions in the Bill.
VISCOUNT SWINTON: I have read the Bill, and I am trying to look at it fairly. You really are not doing what you say. I am asking you to leave well alone; and you say you are doing what I want you to do. But you are not, with great respect. The Bill says: "Notwithstanding anything in the said Part II, the functions … so far as they are declared by regulations.…" That is certainly not leaving well alone; it is leaving you to do what you please by regulation. The very thing I am complaining about is that you are dividing the thing up unnecessarily here by making these regulations. You are going to divide the func-
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tions. I ask the noble Lord definitely: Is it not your intention, and would you not have the power, to take over the lower waters of the Lee and hand them over (which I believe is what is going to happen to the Transport operation) or to hand over, as I think Lord Walkden said, the whole of the canal to the Commission?
VISCOUNT ADDISON: I can only tell the noble Lord that I am referring him to the Bill, and that the navigation duties, and so forth, will of course belong to the Commission. That is their business. I understood him to say he wanted them to do that work. That is the business of the Commission, but it provides here that those other functions which are not those functions shall be exercised by the Lee Conservancy Catchment Board.
VISCOUNT SWINTON: I am very sorry to press the noble Lord over this—
VISCOUNT ADDISON: If you do not want the Amendment—
VISCOUNT SWINTON: The noble Viscount really need not get fractious with the House. We are trying to make this into a better Bill and, quite honestly, the water supply of London is worth half an hour's consideration, even after dinner. The word is "functions," and the phrase is, "the division of functions." What I have asked the noble Viscount—and I really should have thought it could be answered —is: "Who is going to have vested in them this waterway? That is what matters—who owns the waterway and deals with the water. You are going to get the worst of both worlds out of this. You are going to vest the waterway, so far as I can make out, in two people. But maybe you are going to vest it as Lord Walkden said last time. The canal, which is the bed with the water in it, he told me last time was going to vest in the Commission. He told me that quite definitely. Is that so? If you are going to vest the waterway in the Commission, what is the good of saying that a function is going to vest in someone else? The man who owns the water is going to deal with the water. Really the noble Viscount must know that the worst thing you can possibly do is to have two people responsible for the same job. You never know who you have to hang if things go wrong.

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At the present moment, we are left in complete uncertainty as to what is the appointed day. It has to be settled under regulations. Under regulations the functions can be divided. I think I have made a helpful proposition. I believe that when the noble Viscount is less tired than he is now, he will appreciate that I have not been unhelpful with regard to this Bill. I was not unhelpful over the railway clauses before dinner, and I am not being unhelpful over this. But there is a great issue here. Do not think that I am trying to score a Party point. Go on and mess up London's water supply, and you will give me a political cry than which I could not have a better. But I want to get this right. I believe that it is wrong to divide functions by regulations. If the noble Viscount pleases, I will suggest that we accept what he has put in; but I must claim the right to come back to this on Report stage, because I am not prepared for any theoretical handing over of a canal which, except at its lower end, is practically non-existent, without being satisfied that I am doing right and that I am not putting in jeopardy the water supply of London.
On Question, Amendment agreed to.
VISCOUNT FALMOUTH VISCOUNT FALMOUTH moved to leave out Clause 116 and insert:
"Notwithstanding anything in Part II of this Act the Lee Conservancy Board shall as agents for the Commission continue to carry on the undertaking of the said Board which vests in the Commission under Part II of this Act and the said Board shall as respects the exercise of their functions as a harbour and canal authority give effect to any directions which may from time to time be given to them by the Commission."
The noble Viscount said: I have spoken on my Amendment previously and I would just like to say a further word or two about it if I may. The whole object of the Amendment is to avoid "boggling the caboodle," for that is what is going to happen if these functions are separated. As the noble Viscount has explained, you cannot separate the water, the barges on the water, the locks, the weirs, and so on, from one another. The different functions must be combined. It is hopeless to try to separate them. If you do, you will have endless expense and endless correspondence—correspondence between the engineer dealing with locks and the engineer dealing with weirs, corre-
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spondence between the manager dealing with one side and the manager dealing with another side. Instead of that the same man now attends to both matters and there is no difficulty.
The whole object of my Amendment is to carry out the intention of the Bill, which says that anybody may be appointed under Clause 2 as agent for the Commission. I am asking you not to split the Lee Conservancy Board but to appoint them as agents to act under the Commission as regards their transport functions, and in that way, so to speak, to leave the matter alone. I am sure that that will work very well. The Minister of Transport will be able to include the 2,000,000 tons of traffic in his returns, and we shall get along very well. The Thames has been excluded, and it is a parallel case. It supplies water to West and Central London and has barge traffic, but this traffic is nothing like so great. In all other respects the position is parallel. The Thames has been excluded and I would ask the Committee to accept this Amendment, which simply means that the Conservancy Board will act as agents for the Commission.
Amendment moved—
Leave out Clause 116 and insert the said new Clause.—(Viscount Falmouth.)
VISCOUNT ADDISON: This Amendment is in direct contradiction to the one we have have just accepted, and I hope the noble Viscount will not go on with it.
VISCOUNT SWINTON: In view of what has happened I do not think we can pass this Amendment. We will see what we can do about it on the Report stage.
VISCOUNT FALMOUTH: I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 116, as amended, agreed to.
Clause 117 agreed to.
Clause 118 [Other provisions as to orders and regulations]:
LORD ROCHDALE LORD ROCHDALE had given notice that he would move, in subsection (2), after "department" to insert:
"(other than regulations a draft of which is required by any provision of this Act to be laid before each House of Parliament before they are made)."
The noble Lord said: This is not being moved, but if I may make an observation, this is consequential on the Amend-

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ment which came up to delete the whole of Clause 81. But as was suggested earlier this afternoon by my noble friend Viscount Swinton, in regard to draft regulations on another matter, this Amendment may have to be reintroduced on Report.
Clause 118 agreed to.
9.43 p.m.
Clause 119:
Penalties.
119.—(1) If any person, in giving any information, making any claim or giving any notice for the purposes of any provision of this Act, or any regulation or order made thereunder, makes any statement which he knows to be false in a material particular, or recklessly makes any statement which is false in a material particular, he shall be liable on summary conviction to imprisonment for a term not exceeding three months or to a fine not exceeding one hundred pounds or to bath such imprisonment and such fine, or on conviction on indictment to imprisonment for a term not exceeding two years or to a fine not exceeding five hundred pounds, or to both such imprisonment and such fine.
LORD BEVERIDGE LORD BEVERIDGE moved, in subsection (1), to substitute "four months" for "three months." The noble Lord said: I rise to move the Amendment to strike out the word "three" and substitute the word "four." I need not inform the Government, though possibly I ought to inform some of the members of this Committee, that the object of this Amendment is not to increase the penalty against road hauliers and others who are unable to make a success of the puzzles set before them by this Bill. Nor is the Amendment dictated by any theoretical preference for even numbers as compared with odd. I would be equally prepared to accept, if the Government desired, the word "five" or "seven" in place of "three." The object of the Amendment is simple. Having regard to the general law of the land, if for any particular offence the maximum penalty on summary conviction is three months, then the person accused has no right of appeal to a higher tribunal, the Quarter Sessions or the Assizes. If you increase the possible maximum penalty above three months, then he has that right.
The object of the Amendment is to raise the question of whether, for the great mass of new offences of making false returns to Transport Commissioners, the penalty should be one which can be inflicted by a court of summary jurisdiction
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without any chance of going to Quarter Sessions. I suggest that it would be no answer to this Amendment to say that three months is what applies under the Defence of the Realm Regulations to most of the offences which we wittingly or unwittingly committed during the war. The Transport Bill is based on the assumption that we are ultimately to get out of war conditions into conditions of normal peace, and it is important to realize that it will be very difficult for people to make statements about all their journeys in the year 1946 and it will be very difficult often to say whether wrong statements are recklessly made or not. If I were a road haulier I might make a statement rather recklessly in order to avoid the research which would be required to make a duly proved statement.
I put down this Amendment in order to raise the question as to whether these functions under this Bill ought to be such that they can all be dealt with on summary conviction, or whether there shall be a right of going to a higher tribunal. I hope it may be regarded as a reason for legitimately taking up the time of this Committee, on this later stage, that this is one of the clauses which was more completely guillotined than almost any other clause—or, at any rate, as completely guillotined as any other clause—when the Bill was under discussion in another place. This clause was not discussed at all. In fact, three Amendments by the Government, extending the scope of the clause, and applying it to offences against the regulations, and others, were put down on the Committee stage in another place, but were not discussed at all. This all happened on April 1, 1947. That was the high water mark of the Government achievement. I think this was one of the fourteen clauses of this Bill which were guillotined without any discussion whatever in the other place. That being so, I venture to suggest that it is part of the duty of this Committee to see that there is some explanation. Every word of these clauses stands not as the considered view of another place, after the democratic discussion about which the Minister spoke in introducing the Bill, but as the view of what the Government and their officials thought was fair to the public.
Let me say at once that I am delighted to see the noble and learned Viscount, the

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Lord Chancellor, on the Benches opposite. If he, as the guardian of our judicial procedure and as being responsible for fairly adjusting our judicial and criminal procedure to the various offences which citizens are liable to commit, in the due dispensation can assure me that he considers what is proposed in the Bill is right and just, and will maintain the high standard of British justice, I shall at once without question withdraw my Amendment. I have moved this Amendment so that the Government may give us their reasons for saying that the policy proposed by them, of making all these offences summary jurisdiction offences, without the possibility of appeal to any other court, is the right procedure. I beg to move, in order to have that discussed, as it was not discussed, or even considered, in another place.
Amendment moved—
Page 121, line 4, leave out ("three") and insert ("four").—(Lord Beveridge.)
THE LORD CHANCELLOR: I have no hesitation in telling the noble Lord that I think acceptance of this Amendment would be most unfortunate. I am not prepared to give precise figures, but I think that something of the order of 98 per cent. of all the criminal cases in the country are tried and disposed of before magistrates. To my mind, it would be absolutely disastrous to the working of our jury system if we did not have this differentiation between cases which are disposed of summarily and cases which go before a jury. In this Bill I am not creating a new precedent; I am following a precedent which is nearly one hundred years old. Countless Acts of Parliament do this in order that the small offences may be dealt with summarily. Incidentally, the noble Lord did not mean that there was no appeal from the magistrates. There is, of course, an appeal from the magistrates, but there is not a right to a jury.
VISCOUNT SWINTON: An appeal to Quarter Sessions from the magistrates?
THE LORD CHANCELLOR: Yes. If we adopt this principle and do away with differentiation between the small case and the big case, and give the right of a jury in every case, I tell your Lordships, quite frankly, that in my opinion, the whole system of the administration of justice
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would break down. I cannot possibly accept this Amendment.
LORD BEVERIDGE: I am naturally delighted to accept the assurance of the noble and learned Viscount—who does stand for the justice of this country and its judicial procedure—that this is the right procedure. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD MANCROFT LORD MANCROFT moved, at the end of the clause to insert:
"Provided that no such person shall be liable to fine or imprisonment if he shows that he had reasonable ground to believe and did believe that a competent and reliable person was charged with the duty of seeing that the provisions were complied with and was in a position to discharge that duty."
The noble Lord said: I rise to move the Amendment which stands in the name of the noble Lord, Lord Rochdale, and myself. This Amendment is closely linked with one moved some days ago by the noble and learned Viscount, Lord Maugham, on Clause 18 (3), and it will be within the memory of the Committee that the purpose of that Amendment was to set the noble Viscount's mind at rest from the point of view of a director who might be liable if a dividend were declared after the date upon which the Bill decided that no dividend should be declared. The noble and learned Viscount wanted to ensure that the director would be exonerated from blame if he had acted on the advice of a competent and reliable official, charged with seeing that the provisions of Clause 18 were carried out.
He prayed in aid Clause 19 of the Companies Bill, as it left your Lordships' House—and perhaps I might be forgiven for reading that clause to your Lordships. It is very short, and it is directly in point with this Amendment. Clause 19 reads:
"A director shall not be liable to a fine or imprisonment under section one hundred and twenty-two or one hundred and twenty-three of the principal Act or any provision contained in the sections of this Act relating to a company's accounts for failing to take reasonable steps to comply or secure compliance with any provisions of that Act or this Act, if he shows that he had reasonable ground to believe and did believe that a competent and reliable person was charged with the duty of seeing that that provision was complied with and was in a position to discharge that duty."
I think that Amendment was actually inserted in the Bill at the instigation of the noble and learned Viscount, Lord

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Maugham, in conjunction with the noble and learned Viscount, the Lord Chancellor.
The noble Lord, Lord Nathan, in replying for the Government, would not accept the Amendment at first, and the reasons he gave for turning it down were twofold. First he said that Clause 18 applied only to the payment of a dividend which was solely the responsibility of a director, and he felt that the director should not be able to throw off that responsibility. Secondly, he said that the penalties to which a director would be liable if he failed were only to make good the sums that had been paid, and were not penal: He would not be liable to be fined or imprisoned. However, the noble Lord, Lord Nathan, realizing that he had two ex-Lord Chancellors against him, agreed, with some discretion, to reconsider the matter. This Amendment is on very much the same point. As I understand it, what the clause says is this. A director or any other officer of any organization will be held guilty of an offence which that organization may have committed against the Bill, or the regulations made under the Bill, unless he can prove that he neither consented to nor connived at it and took every precaution to prevent its commission. That is very much wider, and I must submit to your Lordships that it is unreasonably wide. I would almost go so far as to say that one can see the question of the burden of proof raising its ugly head again.
I also had in mind the point which has been raised more than once—the case of a director who has been appointed for his technical qualifications consenting to some act of a financial nature, about which he really knows very little, and which he does on the advice of a competent accountant whom he was perfectly justified in trusting, and with the accountant acting in all good faith. If I may take up the noble Lord, Lord Nathan, on the two points he raised previously, this Amendment applies to the whole Bill. It applies right through Clause 18 and not only to dividends. Moreover, my Amendment does embody a penal distinction. It says quite distinctly that no such person shall be liable to fine or imprisonment. Having read Clause 19 of the Companies Bill, I think it would be wrong not to agree to this Amendment because this Amendment and that clause are completely in
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agreement, and it would be contrary to that Bill and to natural justice if this Amendment were not accepted. I very much hope that the Government will see their way to accept it.
Amendment moved—
Page 121, line 29, at end insert the said proviso.—(Lord Mancroft.)
THE LORD CHANCELLOR: I do not think we ought to accept this Amendment. It is quite true that when I was in a particularly benevolent mood I did concede some such proposition in the Companies Bill relating, if hay memory serves me right, to accounts, but I cannot conceal from myself this fact that an exactly similar provision to that contained in this clause appears in the Borrowing (Control and Guarantees) Act, 1946, the Coal Industry Nationalisation Act, 1946, Civil Aviation Act, 1946, Exchange Control Act, 1947, which is later than the Companies Act, and in many Bills now before Parliament. I could not accept this Amendment and I do not think it is right to accept it; on principle, I think it is wrong. There is no question about onus of proof; that is perfectly plain. If an offence has been committed, it is placed upon the director to prove that he was not guilty. That is a practice in all these recent Acts. What must he show? He has to prove:
"that the offence was committed without his consent or connivance, and that he exercised all such diligence to prevent the commission of the offence as he ought to have exercised having regard to the nature of his functions in that capacity and in all the circumstances."
If a director is appointed for some particular purpose which has no relation to the offence, having regard to his functions and in all the circumstances he would, without the slightest difficulty, prove that he was not to blame. We must assume that the Judges who try these cases have some common sense, and they would say that a man in that capacity was quite blameless and would discharge the onus. There are unfortunately some directors of bodies corporate who are not very anxious to prevent offences and who are sometimes anxious to shelter behind the body corporate. In those circumstances, I suggest to your Lordships that this clause, hallowed now by long usage which in practice has worked very well and has not led to any of the difficulties suggested by the noble Lord, is the right and fair way of dealing with this matter

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and it will prevent a body corporate from being able to drive a coach-and-four through the Act. I cannot accept this Amendment in these circumstances.
VISCOUNT SWINTON: I hesitate to challenge the noble and learned Viscount the Lord Chancellor on a legal matter, but this is rather more than a legal matter, because a good many people who are not lawyers are likely to be concerned in prosecutions under this clause. I do not think anybody has the least doubt or has suggested that the High Court Judge would not be able to come to a conclusion upon this matter; no one has cast such a reflection upon a High Court Judge. But the whole point is this: Should a man who is quite capable and well able, without any difficulty, to prove himself innocent to the satisfaction of a High Court Judge, be prosecuted in the first instance? That is the issue here. I leave aside for the moment the fact that it is rather an unpleasant thing to be prosecuted. Everybody knows when a man is concerned in a criminal prosecution, but a good many people are apt to forget whether he was acquitted or convicted. It is rather like being in the Divorce Court: nobody remembers whether one was the petitioner or the co-respondent, and some of the mud sticks.
What happens about costs? A man is brought before the court and he has to brief somebody. He is perhaps a reputable person, and it is a terrible thing to be charged in a criminal court. He has got to brief somebody in the capacity which the Lord Chancellor occupied in pre-war days, and that costs quite a lot. I once had the privilege of contributing, though it was not in a criminal case, and it was well worth the money. But it cost a great deal of money, and why should he be put to that expense? If he is acquitted what is going to happen then? Are the Government or the Commission who prosecuted him going to pay costs? The Lord Chancellor has said that we have put this provision into one or two Acts of Parliament.
I have a recollection that in the Exchange Control Act the noble and learned Viscount the Lord Chancellor himself—I hope he will correct me if I am wrong—made a particular appeal for rather exceptional treatment because these things were so very difficult to detect. We know
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the difficulty about these exchange operations. The Lord Chancellor also said that we were living in a state of economic siege (I think those were his words) and that therefore we must take very special precautions. We are not living in a state of economic siege so far as the transport system of the country is concerned. Nothing of this kind was done in the Coal Industry Nationalisation Act.
THE LORD CHANCELLOR: I am told that exactly the same thing was done in the Coal Industry Nationalisation Act of 1946. I am sure I did not say anything about "economic siege" in the debate on the Coal Industry Nationalisation Act.
VISCOUNT SWINTON: We have gone through this Bill, with its more than 120 clauses; and as one goes through it one finds one offence after another being created. They are not such offences as where a man is accused of having made a statement in order to get some money out of the Government by false pretences. In every clause we find that something is to be done by regulation. Regulations are to be laid in draft, so complicated are they, before they are promulgated. The clause applies to "every person who at the time of the commission of the offence was a director, general manager, secretary, or other similar officer "—I do not know what that means; I suppose it is anybody similar to a director, general manager, or secretary. There is a very common practice of employing highly qualified firms to act as secretaries to companies. One does not want indifferent people; it is much better to get a firm. Are a great firm, a firm of accountants or chartered secretaries, going readily to take on a job of this kind if, when any offence is committed under any of the million regulations made under this Bill, they are going to have to brief expensive counsel to defend them?
I really do feel that we should have a little sense of proportion in this matter, and that it might be not unreasonable that it should be up to the prosecuting authority to decide whom they should prosecute. Obviously, what will happen under the Bill as at present drawn is that they will find that one of these offences is committed. The Lord Chancellor was himself saying how difficult it was to remember all the forms one had to fill up.

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I dare wager that there is hardly a member sitting on either Front Bench or Back Bench who has not to-day, quite unconsciously, been guilty of some offence under one of the million and one regulations—not because we deal in the black market; we do not; but because the pig's return, or perhaps the pig's grandmother's return which we have filled up is completely wrong. I do not know whether the Lord Chancellor is a farmer like myself, but I spend the whole of Sunday afternoon trying to fill up the ridiculous returns that are thrown at us to-day. I do not suppose there will be any reduction in the number of them when this scheme gets going, and then anybody who fills them up will be liable to be found guilty of an offence.
I regret that the great legal authorities are not in the Chamber at the moment, and I certainly say that this matter should be looked at. When we were applying this principle in the Companies Act it was in regard to the keeping of accounts. In that case there was a very specific thing, one kind of offence. The form in which the accounts are to be kept is laid down in the Bill. The Lord Chancellor himself agreed that a person should not be liable except in the terms of the proviso my noble friend has moved. But here, where there may be a hundred and one offences, everybody can be prosecuted. The whole "caboodle" will be prosecuted, and every one of them will have to brief somebody to prove his innocence. That is the kind of slave State that we are entering, and this is the kind of legislation that will bring it about.
LORD SALTOUN: I would like to suggest to the noble and learned Viscount one thing. There may be among these officials of the body corporate a man who has had nothing to do with the offence, and really had a very vague knowledge of its commission. By reason of his ignorance, he might find great difficulty in proving that he was not implicated. He may be engaged in another side of the business and may not know what is going on at all. He might find difficulty in proving it because he did not know what was going on.
LORD MANCROFT: I am sorry that I have not had the good fortune that the noble Viscount, Lord Maugham, had in finding the Lord Chancellor in a good
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frame of mind. I do not feel justified in asking your Lordships to make an issue of this matter, and I therefore beg leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
Clause 119 agreed to.
Clause 120:
Power of Minister as to inquiries.
(2) Where an inquiry is held under this Act, the Minister may make such order as to security for the payment of, and as to the payment of, the costs incurred by him in connection with the inquiry as he may think fit:
Provided that no person shall be ordered to find security for the payment of, or to pay, costs of an inquiry to which he is not a party.
(3) Any costs directed by the Minister to be paid under this section may be recovered by him summarily as a civil debt.
LORD ROCHDALE LORD ROCHDALE moved to leave out subsections (2) and (3). The noble Lord said: I beg leave to move the Amendment that stands in the name of my noble friend, Lord Hawke, and myself. This Amendment deals with the clause—
LORD MORRISON: If the noble Lord would forgive my interrupting, it may facilitate matters if I say that we propose to accept this Amendment.
LORD ROCHDALE: In view of that delightful statement by the noble Lord, I beg leave to move it formally.
Amendment moved—
Page 121, line 34, leave out subsections (2) and (3).—(Lord Rochdale.)
On Question, Amendment agreed to.
Clause 120, as amended, agreed to.
Clauses 121 and 122 agreed to.
Clause 123:
Interpretation.
123.—(1) In this Act, except so far as the contrary is expressly provided or the context otherwise requires, the following expressions have the meanings hereby respectively assigned to them, that is to say,—
"licensing authority for goods vehicles" means a licensing authority within the meaning of Part I of the Road and Rail Traffic Act, 1933;
"licensing authority for public service vehicles "means one of the bodies established under the Road Traffic Act, 1930, and heretofore, known as "Traffic Commissioners";

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"local authority" means the council of a county, the Common Council of the City of London, or the council of a county borough.
LORD MORRISON: On behalf of my noble friend Viscount Addison I beg to move this Amendment, which is purely drafting.
Amendment moved—
Page 123, line 43, leave out from beginning to end of line 4 on page 124.—(Lord Morrison.)
On Question, Amendment agreed to.
LORD ADDINGTON LORD ADDINGTON moved, in the definition of a local authority, at the end to insert:
"and includes in section 62 of this Act any joint board of local authorities constituted by a local enactment".
The noble Lord said: The first of these Amendments refers to the special case of the Stalybridge Board, which consists of representatives of four non-county boroughs and conducts a transport undertaking which during the year ended March 31, 1946, carried very nearly 28,000,000 passengers. It seems generally to be agreed that they should be consulted, but it is not quite clear whether they do come within the category of those whose representations have to be considered under Clause 62. This Amendment is being moved to make it clear that this should be so. It is possible that this turns on the definition of the word "person", but I think that it is desirable that it should be clear. I beg to move.
Amendment moved—
Page 224, line 7, at end insert the said words.—(Lord Addington.)
VISCOUNT ADDISON: I shall be glad if the noble Lord will allow us to accept this Amendment, but in a somewhat different form. I understand that the words "joint board" are rather too wide for the purpose which he has in view and to which we should like to agree. If he will, between now and the Report stage, let me consult as to the form of words which are required, I think we can arrange to insert words that will cover the case which he has in mind, and others like it.
LORD ADDINGTON: I am very much obliged to the noble Viscount, and I shall be happy to enter into any consultations that may be necessary. In view of his assurance, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD ADDINGTON LORD ADDINGTON moved, in the definition of local authority, to leave out "county borough" and insert "borough, including a metropolitan borough." The noble Lord said: This Amendment concerns the definition of a local authority. Under the Bill that definition now reads:
"'local authority' means the council of a county, the Common Council of the City of London, or the council of a county borough."
I should very much prefer the definition of "local authority" to be the same in all acts. I have submitted two Amendments on this matter because the points are not quite the same. The first Amendment, which is to omit "county borough" and insert "borough, including a metropolitan borough" restores words that were in the Bill when it was first introduced into Parliament. The alteration was made by the Government during the Report stage in another place. It was made with no explanation and it has, therefore, not been quite clear what the reason was for that definition being altered.
The references to local authorities in this Bill concern first of all Clause 6 (4) (b), which refers to the transport users consultative committees. They also concern the clause about the right to make representations. I would urge that these are essentially matters for a local authority and not for the county council—that is much more remote. It is the towns in the country in large and scattered areas which are the focal point to and from which traffic flows, and therefore those councils have their transport problems most in mind. Experience, particularly in the war years, has shown that the ordinary man and woman in the street with a grievance goes to his local council and consults them, and not to the representative on the county council.
Secondly, on this matter of consultations, again under Clause 62 (2), I am given to understand there were consultations between representatives of the municipal authorities and the Minister of Transport, and certain arrangements were made to meet their views. Those who represented municipal bodies were clearly under the impression that they were dealing with the definition as it was then in the Bill, and they consider that the alteration of the definition makes a very material difference to the carrying out of the arrangement then under dis-

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cussion. Again I think it may turn on the definition of that word "person" in Clause 62 (2) on the fourth line of page 77. I should have thought that there was a distinction between the bodies referred to, and that "a person" would exclude a corporate body like a non-county borough. I think it very important that certain larger non-county boroughs and particularly any who actually conduct transport services should be consulted under this clause and they should be included in the definition of local authority for both of the other clauses to which I referred.
LORD MORRISON: I hope it may be for the convenience of the noble Lord who has just addressed the House if I deal with this Amendment and the next one together. I am sorry I am unable to repeat the success which he had a moment ago in having an Amendment accepted, but I am able to give him what I think will be a satisfactory explanation. It is true, as the noble Lord said, that when the Bill was originally introduced the definition included non-county boroughs and metropolitan boroughs. The reason why the Government decided to amend the definition was because the urban districts then asked, owing to the inclusion of non-county boroughs, that urban districts should be included, and it came to the knowledge of the Government that the rural districts were preparing to make a similar request.
The effect of that would have been to extend the field of consultation over an unreasonably wide area, and accordingly the Government reached the conclusion that the definition should be amended so as to embrace only county boroughs, county councils and the Common Council of the City of London, leaving the views of inhabitants of non-county boroughs and county districts to be ascertained through the county council, and not both through that channel and also directly. That Amendment, as the noble Lord knows, was effected during the Report stage in another place. The Government have gone a long way in requiring the Commission to consult with local authorities to ensure that local wishes and views are fully placed before the Commission, but a point is reached at which excessive consultation can stultify effective action. If the field of consultation is extended beyond the county and county borough
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limits, it is the Government's view that stultification will begin to arise, and if if the urban districts are included there would be little ground for resisting a similar claim from the rural districts. I regret that in these circumstances I am unable to accept the Amendment.
LORD ADDINGTON: I regret the reply of the noble Lord. I do not know whether it would meet the case if there was a limit to the size of the district which the Commission would have to consult. For instance, it is quite possible to add to Clause 62 in order to impose, a limit, and there would then be no obligation to consult any local authority below a certain size. I will not pursue the matter now, but we might have a word about that matter when we consult on the other Amendment. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD MORRISON: On behalf of my noble friend Viscount Addison, I beg leave to move the next Amendment which, as your Lordship will have noticed, is a definition of the word "meat."
Amendment moved—
Page 124, line 7, at end insert—
("' meat' means carcases of animals, parts of carcases of animals, or offals of animals, being carcases, parts of carcases or offals suitable for human consumption, whether fresh, chilled or frozen, but not being carcases, parts of carcases or offals which have been cooked or subjected to any process other than skinning, trimming or cleaning").—(Lord Morrison.)
LORD TEYNHAM: I am very grateful to the noble Lord for this Amendment, which really explains the definition of the word "meat" in Clauses 39 and 52. I moved an Amendment on both those clauses to deal with perishable goods. I think this meets the case very well, and I am sure the Association of Food Manufacturers will be very pleased to hear that this Amendment has been agreed to.
On Question, Amendment agreed to.
LORD MORRISON: On behalf of my noble friend Viscount Addison, I beg to move this further Amendment, which deals with the definition of "superimposed trailer."
Amendment moved—
Page 125, line 46, at end insert—
("'superimposed trailer' means a trailer which is normally attached to the vehicle that draws it in such a manner that part of the trailer is superimposed upon that vehicle and that not less than twenty per cent. of any load evenly distributed upon the trailer is borne by that vehicle").—(Lord Morrison.)
VISCOUNT SWINTON: Will the noble Lord tell me just what this does mean, and also whether it has any bearing on the matter of ancillary vehicles which we agreed we would consider further on Report stage?
LORD MORRISON: The Amendment is linked with the Amendment to Clause 47, page 58, line 21, in the name of my noble friend Viscount Addison. The definition of "superimposed trailer" is by this and the related Amendment transferred from subsection (1) of Clause 47 to the interpretation clause, Clause 123. The transfer is desirable since the expression is also used in the proposed new Clause 55.
VISCOUNT SWINTON: It is really a drafting Amendment, and leaves the question of ancillary vehicles as it was.
On Question, Amendment agreed to.
Clause 123, as amended, agreed to.
LORD RANKEILLOUR LORD RANKEILLOUR moved to insert the following new clause:
"Notwithstanding anything in the Trustee Act, 1925, it shall be lawful for trustees to invest the proceeds of the sale by them of any British Transport Stock in any security comprised in the sixteenth Schedule to this Act."
The noble Lord said: I propose this Amendment to insert a new clause in the interests of beneficiaries who are seriously penalized in their income under the provisions of this Bill, and whose trustees can do little or nothing for them, owing to the law as it now stands. I raised this question earlier, but it was under somewhat unsatisfactory conditions. I thought it was necessary to bring it in at an earlier point and, therefore, I drafted an Amendment rather hastily, and was not able to supply a schedule to carry it out. I therefore had to bring in requirements about Treasury regulations and orders, and their being laid on the table of both Houses of Parliament, which was a very unsatisfactory way of trying to carry out my object. But now I have been able to construct a schedule—at any rate a schedule for argument—though I do not attach any great
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importance to its exact provisions. To construct a schedule in these circumstances, showing what may be allowed and what may not be allowed, is an extremely difficult task, and whatever is proposed will be taken to err either by excess or defect. Looking it over, I find that I should have included guaranteed stocks and excluded securities subject to call.
Thanks to the kindness of an informant on the general question of the schedule, I have come across a very relevant precedent to this clause. It is in the Coal Act of 1938, Geo. VI. I. 52. It comes in the Third Schedule, paragraph 21, subparagraph (5). When I read this provision I was, in the celebrated saying of Lord Clive, really astonished at my own moderation, because that which is the law of the land, and which was passed in somewhat similar circumstances, goes much farther than I propose. It goes so far as to include debentures, guaranteed and preference stocks of companies on whose ordinary stock only 3 per cent. for a period of five years has been paid. I propose in my schedule that they will have had to pay 5 per cent. for fifteen years. Then this Act of 1938 actually admits ordinary shares that have paid 5 per cent. over ten years, and I do not admit ordinary stock at all. I do not, however, want to argue the exact particulars of what should and should not be included, but I do say that here is a proposal which has more than ample precedent behind it. I need hardly remind your Lordships that the Coal Act dealt with the compensation proposed when the coal royalties were taken over, and I have never heard that there was any very strong objection to it.
I should explain that I have included a proviso which would bar the question of admission to this Schedule of a company which had the balance of its finance overweighted by prior charges. That would obviously make it easier for the dividend on the ordinary stock to be paid, and thereby qualify the preference stock while diminishing the margin of safety. I could hardly be so sanguine as to suppose that this Amendment will be accepted in its entirety, but I do ask the Government and your Lordships generally to consider the matter. I am not going into details of the hardships which beneficiaries will suffer in individual cases. That has already been fully

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gone into, and I can add nothing to the speech of the noble Lord, Lord Balfour of Burleigh, on that subject. I think it is admitted that there is a hardship, and I beg to move this Amendment in mitigation of such hardship.
Amendment moved—
After Clause 123 insert the said new clause. (Lord Rankeillour.)
THE LORD CHANCELLOR: I quite understand the motive and the object of the noble Lord, and I agree that it would be wrong of me to try to write it off merely because of the technical details of his schedule. If this Amendment were to be carried, it might be that we should have to consider that schedule. But I must say this to your Lordships. I do feel that a Transport Bill is a completely inappropriate vehicle in which to make a very far-reaching and important change in our law in this regard. That ought to be done in the Trustee Act. I myself am concerned in trusts and I can well understand—I will put it in this way—that there is a case for consideration as to whether the provisions of the Trustee Act should not be extended and enlarged. I am satisfied that it is inappropriate to do it here. It is the fact, as the noble Lord has said, that in the Coal Act of 1938—I do not know whether he only knew that after he had put his Amendment down—
LORD RANKEILLOUR: Somebody else's mind has been moving on the same lines as my mind.
THE LORD CHANCELLOR: Then it is a case of great minds on this occasion thinking alike. It was the fact that in that Act there was a provision that compensation money—I forget what the exact amount of money involved was; I believe it was a comparatively small figure compared with this sum of money, something of the order of £66,000,000—was allowed to be invested in certain securities therein set out. The noble Lord wants to do very much more than that. His Amendment has this effect: that the trustees can either get allotted to them a case for holding railway stock, for instance, or they can go into the market and buy this stock afterwards and can do exactly what they like, though in substance it is a breach of the terms of their trust altogether. That seems to me, as one of those responsible for the protection of trusts, an impossible situation. There is a place to consider
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Whether, or not in the circumstances to-day there is a case for enlargement and relaxation of the requirements of the trustee, but it cannot be done by a Transport Bill, which should not fundamentally alter the law applying to all trusts. In those circumstances, whatever the terms of the Sixteenth Schedule are, I could not possibly accept this Amendment.
VISCOUNT SWINTON: I do not dissent from the general proposition that this is not an appropriate Bill in which to introduce this Amendment, although in the Coal Act it was done, and it was done to meet cash compensation. After all, the only reason why cash compensation is not paid here (which Lord Nathan said was the way it ought to be done) is because the Government did not want to produce an inflationary market by paying out cash. They are therefore compelling people to take stock. Lord Morrison shakes his head, but I have learned it from Lord Nathan, and that is what Lord Nathan said. Indeed, it is the only possible justification for paying stock and not cash, as the noble Lord agrees. The argument that it was right to give the coal people the power to invest in a wider range of investments because there were not so many of them, but that it would be wrong to do it here because there are a great many sufferers, does not honestly seem to me to be a very good argument. This kind of argument—that it is only a little one—seems to me, if I may respectfully say so, to be more appropriate to an errant housemaid than to an upright Lord Chancellor, but I do not dissent from the broad proposition that this ought to be done in an Amendment to the Trustee Act.
I am glad the Lord Chancellor agrees, but without committing himself definitely (and I would not expect him to do so on this clause), that it is urgent that that matter should be considered. What vie are, I think, entitled to ask the Government on this clause is not to express a definite opinion of what extension should be made in the Trustee Act, but, as this subject has become urgent and insistent because of the cumulative acts of the Government who are taking away against their will, time after time, the investments of trustees, to admit that this is a problem that ought to be dealt with. We say to them, "Will you undertake in the next Session of Parliament to give time for such a Bill?"
LORD BEVERIDGE: I confess to great disquiet at the answer given by the noble and learned Viscount, the Lord Chancellor. It is no good amending the Trustee Act afterwards. It would take a long time. With regard to one argument used by the Lord Chancellor—that this proposal would enable trustees at any time to go and buy transport stock and then sell it and get rid of the trustee condition—I suggest that this could be absolutely met by limiting the Amendment moved by the noble Lord, Lord Rankeillour, to British transport stock issued under this Bill in compensation. That would make it impossible for the trustees to go into the market, and it would also make it clear that this Amendment is not a general amendment of the Trustee Act but an attempt to produce more justice and equity in this particular compensation proposal, which at present is wholly without the elements of equity or justice to the stockholders.
Surely it is no good to wait for an amendment of the Trustee Act and surely you do not want it. There may not be a case for generally increasing the powers of the Trustee Act, but there may be a case for enabling trustees who are forced to sell now part of their holdings which are giving them perhaps 4 per cent. in return for a holding giving perhaps 2½ per cent. to make better provision for their trust. The question has been raised: what was done in the Coal Industry Nationalisation Act. But are you saying that you cannot do it now because you would be doing it for so many? That is to say: a small injustice you will not do, but a big injustice you will. I beg the Government to try to bring some element of justice and humanity into their treatment of this problem and not to bar the door to the last attempt to display these qualities in their treatment of the railway stockholders.
THE EARL OF SELKIRK: There was one important admission made by the noble and learned Viscount, the Lord Chancellor, and that is that he is responsible for the protection of trusts. That is a point which I was trying to extract the other day and he was reluctant to answer it. That puts the whole question of compensation on different lines altogether. If the Lord Chancellor acknowledges that he is responsible for trusts, we are entitled to expect some ex-
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pression of that responsibility, because there is no doubt that the effect of the present compensation clauses is to force down one lot of trusts and to force up the other lot. If that is a criterion of parity and fairness, it is not my criterion. But I am most grateful to the noble and learned Viscount for what he has said.
LORD RANKEILLOUR: I was not convinced by the argument of the Lord Chancellor. I cannot see what is the difference between the principle as applied in 1938 and the principle as applied in 1947. In both cases certain assets—call them what you like—were taken over by a public authority. In one case the compensation was given in cash, in another case it was given in stock; but the trustees could do very little in 1938 with the compensation they received. Now, in 1947, trustees in this case can do less. I confess that I do not understand the differentiation between the one and the other on the principle of justice. I do not like to withdraw an Amendment, and I shall not press it; I would rather leave it to be negatived.
On Question, Amendment negatived.
10.40 p.m.
Clause 124:
Application to Scotland.
(3) For any reference to the Minister of Health (except in section thirty-four) there shall be substituted a reference to the Secretary of State.
(6) Section twenty-four shall have effect as if for publication under subsection (1) in the London Gazette, there were substituted, in the case of a body having its principal office in Scotland, publication in the Edinburgh Gazette.
LORD SALTOUN LORD SALTOUN moved, in subsection (3), at the end to insert "and for any reference to the High Court there shall be substituted a reference to the Court of Session." The noble Lord said: I am sorry at the fate of my noble friend Lord Rankeillour's proposed new clause, but it certainly does encourage me in the Amendment which I have to move—that in the application of this Bill to Scotland, wherever reference to the High Court is mentioned there shall be substituted a reference to the Court of Session. I am quite sure that the Government will accept that Amendment because it will certainly take a major Act to defeat the jurisdic-

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tion of our ancient Court. I also observe that a little lower down on the page there is a reference to the Court of Session. I beg leave to move my Amendment, and I hope the Government will accept it.
Amendment moved—
Page 127, line 3, at end insert the said words.—(Lord Saltoun.)
LORD MORRISON: I am sorry to disappoint my noble friend with regard to this Amendment, which I am advised is not only quite unnecessary, but indeed misconceived. I think it must have been put down under a misconception. To substitute the Court of Session for the High Court in the provisions would not achieve the object which my noble Friend has in mind. A similar provision in the Road and Rail Traffic Act of 1933, regarding the Appeal Tribunal set up under that Act, proved unsatisfactory. A provision has been made in Section 124 (13) for the enforcement in Scotland of orders of the two Tribunals by recording them in the Books of Council and Session. In view of this perhaps the noble Lord would not wish to pursue his Amendment.
LORD SALTOUN: I understand from the noble Lord that it is not necessary, and that what I want is already in the Bill. Under those circumstances I will certainly withdraw my Amendment.
Amendment, by leave, withdrawn.
THE EARL OF SELKIRK THE EARL OF SELKIRK moved, at the end of the clause to insert:
"(14) Nothing in this Act shall affect or be deemed to affect rights of the superiors of any lands or heritages the dominium utile of which is transferred to the Commission under or in pursuance of this Act to payment of their feuduties and to all other rights vested in such superiors prior to the passing of this Act."
The noble Earl said: This Amendment is moved by way of clarification. There is at the present time an action pending arising under the Coal Industry Nationalisation Act which has left certain dubiety in the minds of those immediately concerned, and I would like, if I may, to read to your Lordships a Clause in the Coal Industry Nationalisation Act which has left this dubiety. It refers to the taking over of liabilities and obligations on the part of the National Coal Board and it says:
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"The vesting of any assets by virtue of this section shall take effect free from any charge or lien for securing money or money's worth to which they are subject."
Precisely those words do not appear in this Act, but there are a number of clauses which have a different bearing, and I will give them to your Lordships now. They are Clauses 14, 15, 45 (subsection (2)) and 46. But I would refer your Lordships perhaps to the simplest one which is Clause 45, subsection (2). Clause 45 (2) of this Bill says that
"Subject to the provisions of this section, all the relevant property shall on the date of transfer, vest in the Commission free from any mortgage or other like incumbrance".
The word "incumbrance" is completely incomprehensible to a Scots lawyer and I therefore refer, if I may, to the interpretation clause which appears in this Bill. I then find that the definition of "incumbrance" is put in this way: "mortgage or other like incumbrance" means a heritable security (within the meaning of the Conveyancing (Scotland) Act, 1924, but exclusive of a real burden ad factum praestandum), or a pledge, charge or lien for securing money or money's worth, and "incumbrancer" means the creditor in a heritable security, or the pledgee or person entitled to the benefit of the charge or lien.
The point which this Amendment is designed to establish, is that a future duty, that is to say the relationship between dominium utile and dominium direction does not fall within that category. It is, of course, not the business of this House to interpret the law, but so far as it is possible to interpret the law, this does not fall within the limits of this interpretation. I would put it the other way round that dominium utile is in fact a burden on dominium directum rather than the reverse, it is a condition. Dominium directum is a pre-eminent right of property and is not in any sense a real burden. I am submitting this simply as a matter of clarity. I am sorry if I have not made myself clear. But I think it is equally important that the Bill should be clear in what it means. One thing that has arisen over a smaller Bill is that an action is pending as to what exactly that Bill does mean. I am asking His Majesty's Government to make clear what in fact this Bill does mean. If His Majesty's Government

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can do that I shall be quite content. I shall be quite content if they make it clear what they mean or accept the Amendment as it stands. I beg to move.
Amendment moved—
Page 128, line 13 at end insert the said subsection.—(The Earl of Selkirk.)
THE DUKE OF BUCCLEUCH AND QUEENSBERRY: I wish to support this Amendment, and at this late hour I shall do it very briefly. This safeguard is important, and I am sorry that the necessity for it has been overlooked. But perhaps that may be due to some misunderstanding with regard to conditions under the Scottish Law. The Government will doubtless wish that the Commission shall fulfil all their obligations, moral and legal, and some such words as this should be a useful reminder to them. I hope that the Government will either accept the Amendment or give us an assurance.
LORD SALTOUN: I should also like to support this Amendment and I too shall do so briefly. The feu system is well established and well known in Scotland. I do not know whether this clause is necessary, and I should very much like to have a declaration from the Government on the point, because it does alarm me that any Government Department should repudiate their duty to pay feu duties under an Act of that kind. I do not want to comment upon a case which is sub judice, but I can imagine a great many peculiar things that might happen in any such case. As the noble Earl, Lord Selkirk, accurately said, though everybody may not quite easily have understood it, there are points in which the subordinate tenure as you might call it, the feu, is sometimes better ownership than the freehold.
LORD MORRISON: As noble Lords will have observed, we are now approaching the hour at which Scottish humour is at its best. We have been delighted by three speeches from Scottish noble Lords explaining this very simple Amendment. Unfortunately I have to inform the House that I am advised that this Amendment is entirely unnecessary. I hope the brief explanation I am going to give will be clearly understood by all noble Lords in the House, and that it will not involve me at this hour in a detailed discussion on the feudal system of land tenure in Scotland.
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The Amendment deals with the case where there is transferred to the Commission land belonging (say) to a railway company. If that land is held of a superior entitled to feu duty, or in other words if the railway company is the vassal or owns only the dominium utile,—
VISCOUNT SWINTON: What?
LORD MORRISON: As I have explained on a previous occasion, I made the unfortunate mistake of leaving Scotland in my youth and I have suffered from it ever since. The transfer to the Commission of the company's estate or interest in the land can in no way affect the separate interest or estate of the superior, who will continue to own the dominium directum and be entitled to payment of his feu duty from the Commission and to any other rights open to him prior to the transfer. In some cases where a railway company acquires land compulsorily under the Lands Clauses Consolidation (Scotland) Act, 1845, it gets a statutory title to the whole interests in the land. In such a case the Amendment is equally unnecessary, there being no superior to protect. I hope, in view of that simple explanation, that the noble Lord will not press his Amendment.
THE EARL OF SELKIRK: I am grateful to the noble Lord, but after all what he said is no more than what I say in my Amendment. Why do the Government not accept that simple, clear statement of what the noble Lord has said? I am only making this point because there is an action pending at the present time owing to some dispute over a similar Act.
LORD MORRISON: What I did say in explanation was proof that the Amendment is quite unnecessary.
THE EARL OF SELKIRK: In that case, if the point is fully covered and there is no intention of including a dominium utile, if I may use the word, as a heritable security, I will withdraw the Amendment.
VISCOUNT SWINTON: It becomes a dominium futile.
Amendment, by leave, withdrawn.
Clause 124 agreed to.
Remaining clauses agreed to.
VISCOUNT ADDISON: In view of the fact that we are now approaching the

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Schedules—and I sincerely hope we shall get through them without unnecessarily prolonged discussion—I beg to move that the House do now resume.
Moved, That the House do now resume.—(Viscount Addison.)
On Question, Motion agreed to, and House resumed accordingly.

SOUTH METROPOLITAN GAS BILL. [H.L.]
SOUTH-WEST MIDDLESEX CREMATORIUM BILL. [H.L.]
Returned from the Commons agreed to.

LONDON COUNTY COUNCIL (GENERAL POWERS BILL.
LONDON PASSENGER TRANSPORT BOARD BILL.
Report from the Committee of Selection, That the following Lords be proposed to the House to form the Select Committee for the Consideration of the said Bills:

E. Iddesleigh,

L. Dorchester,

L. Sinha,

L. Rushcliffe (Chairman),

L. Dukeston.

Agreed to; and the said Lords appointed accordingly.
House adjourned at four minutes before eleven o'clock.