Sitting of 2 May 1956

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  GOLD COAST

    Cocoa Purchasing Company (Commission of Inquiry)
    Mr. Hector Hughesasked the Secretary of State for the Colonies if he will make a statement on the terms of reference to, evidence taken, number of sittings held and progress made to the latest convenient date by the Commission of Inquiry into the conduct of the Cocoa Purchasing Company of the Gold Coast.
    The Minister of State for Colonial Affairs (Mr. John Hare): The Committee began its sittings yesterday. As regards the terms of reference, I would refer the hon. and learned Member to the reply I gave to my hon. Friend the Member for Wavertree (Mr. Tilney) on 29th February.
    Mr. Hughes: Is the right hon. Gentleman in a position to say, in view of the events that have happened, what constructive steps will now be taken consistent with the constructive development of the Gold Coast, particularly with independence in the offing?
    Mr. Hare: I think that on this question the hon. and learned Gentleman will agree that we should wait to hear the results of this inquiry. I hope that useful results will flow from it.

    Gold Mines (Inquiry)
    Mr. N. Pannellasked the Secretary of State for the Colonies whether, in view of the recent closing down and abandonment of certain gold mines in the Gold Coast as the result of strike action, he will consider having consultations with the Trades Union Congress with a view to sending a commission to the Gold Coast to advise on steps to be taken to avoid a repetition of such incidents.
    Mr. Hare: A board of inquiry, set up by the Government of the Gold Coast, has recently investigated the economic condition of the gold mining industry. Sir Will Lawther was a member of the board. The board has not yet reported.
    Mr. Pannell: Is my right hon. Friend aware that such incidents as this, involving the loss of British capital, will discourage the investment of further capital in the Gold Coast and, in particular, might prejudice the River Volta scheme, upon which the future prosperity of the Gold Coast depends? Will he continue to do everything possible to produce a different attitude of mind amongst trade unions in the Gold Coast?
    Mr. Hare: I am certain that my right hon. Friend and I will do all we can to ensure that as good relations as possible exist between employers and trade unions in the Gold Coast.
    Mr. Brockway: Would not the representatives of the Trades Union Congress be likely to exert more influence if the employers in the gold mines allowed them to visit the gold mines and enter into consultation with the workers there?
    Mr. Hare: I hope that when the board has reported it will be possible for a better relationship to be established between the trade unions and the employers concerned.

    European Judges (Retirement Terms)
    Mr. John Hallasked the Secretary of State for the Colonies why the European judges of the High Court in the Gold Coast are excluded from the benefits of the retirement terms provided under the Gold Coast (Constitution) Order in Council, 1954.
    Mr. Hare: The retirement terms provided under the Gold Coast (Constitution) Order in Council, 1954, were intended to meet the altered conditions of service of public service officers; these were not applicable to judges.
    Mr. Hall: Is it not a fact that in both Ceylon and the Sudan there was no discrimination between judges and expatriate civil servants? Is it not a little unfortunate, to say the least, that this discrimination should apply in this case?
    Mr. Hare: I would rather not say anything more at the moment. I should like to tell my hon. Friend, however, that the Gold Coast Government are considering this matter and are likely to make a decision fairly soon.
    Mr. Creech Jones: Will the Minister give his most sympathetic attention to this problem, because of the danger of a breakdown of the judiciary in the Gold Coast unless some amends are made? These judges alone have been excluded from the general terms governing all the expatriate civil servants.
    Mr. Hare: I can assure the right hon. Member that my right hon. Friend has the greatest sympathy with what he has just said.

    Constitution
    Mr. Sorensenasked the Secretary of State for the Colonies what progress has been reached in reconciling the conflicting claims of political parties in the Gold Coast, both in respect of constitutional proposals and the holding of an election.
    Mr. de Freitasasked the Secretary of State for the Colonies whether he will make a statement on the political situation in the Gold Coast, with particular reference to the White Paper recently published by the Gold Coast Government.
    The Secretary of State for the Colonies (Mr. Alan Lennox-Boyd): I have nothing to add to the reply I gave last week to the hon. Member for Rugby (Mr. J. Johnson); but a copy of the Gold Coast Government's White Paper has now been placed in the Library of the House.

  JAMAICA

    Oil (Exploration Programme)
    Mr. Russellasked the Secretary of State for the Colonies what progress has been made in drilling for oil in Jamaica; and with what results.
    Mr. Hare: A well was drilled in 1955 without discovering oil, but the Jamaican Stanolind Oil Company have now embarked, on the strength of the earlier drilling, on a $2 million exploration programme during the next two years.

    Canadian Loan
    Mr. Braineasked the Secretary of State for the Colonies the terms of the loans which the Government of Jamaica are proposing to raise in the United States of America.
    Mr. Hare: The proposal is to raise a loan in Canada, not the U.S.A. The terms of the proposed loan are still being discussed.

    BARBADOS (OIL DRILLING)
    Mr. Russellasked the Secretary of State for the Colonies what progress has been made in drilling for oil in Barbados; and with what results.
    Mr. Hare: Four exploratory wells have been drilled by the Barbados Gulf Oil Company since 1953. No oil has been found, but one well contained natural gas in commercial quantities which will be used to supplement the island's domestic supply. A fifth well is to be drilled.

  CYPRUS

    Situation
    Mr. Hector Hughesasked the Secretary of State for the Colonies with whom the Governor of Cyprus is negotiating for peace in Cyprus since the banishment of Archbishop Makarios.
    Mr. Lennox-Boyd: I have nothing to add to the reply which my right hon. Friend the Prime Minister gave to a Question by the right hon. Member for Ebbw Vale (Mr. Bevan) on 17th April.
    Mr. Hughes: Has the Minister's attention been drawn to the wise speech of the Archbishop of Canterbury relating to this matter in which he said that before inaction injures our friends and incites our enemies still more, we can only hope that the Minister will take some—
    Mr. Speaker: Order, order. The Minister is not responsible for what the Archbishop of Canterbury says.
    Mr. Hughes: With respect, I am not reading any more than one sentence from the speech.
    Mr. Speaker: Even one sentence out of order is too much.
    Mr. Hughes: May I put it in this way? In view of the authoritative expressions with regard to this matter, what constructive and healing steps is the Minister taking?
    Mr. Lennox-Boyd: In regard to the first part of the hon. and learned Gentleman's supplementary question, I would say that my attention was indeed drawn to the Archbishop of Canterbury's speech and, for greater accuracy, he was kind enough to furnish me with a copy and I have made certain comments about it. In my view, it would be extremely helpful if all with powerful positions in this land or elsewhere would weigh most carefully the effect of their words, or what the effect might be, on moderate opinion in Cyprus—the need for such opinion to come forward being of paramount importance. In reply to the second part of the hon. and learned Gentleman's question, we are bending all our efforts to the restoration of law and order in Cyprus, which I think it is the paramount duty of the Government to do.
    Mr. J. Griffiths: May I ask the Secretary of State whether he has considered, or will consider, the advisability of publishing the constitution which Her Majesty's Government would be able and willing to offer to Cyprus? Secondly, would he consider the advisability of approaching the Ethnarchy to see whether it is at all possible to resume negotiations? If not, what steps do the Government propose to take to seek some way of bringing the conflict to an end?
    Mr. Lennox-Boyd: The recent remarks made by some members of the Ethnarchy do not encourage the hope that such an approach would be very effective. If I am not transgressing the rules of the House by reading the Answer to a later Question, I would say that no constitution is likely to have validity OT strength unless it is produced from genuine discussions by those who will be responsible for working it. That is bound to colour my approach to the idea of producing a constitution without discussion in Cyprus and presenting it to the Cypriots for them to look at.
    Mr. Griffiths: Does the right hon. Gentleman propose to take any steps at all—renewed steps with anyone—to seek to negotiate a settlement?
    Mr. Lennox-Boyd: The White Paper brought out very clearly the sort of framework of the constitution which we were prepared to bring forward. I think that is available for all to see.
    Mrs. Jegerasked the Secretary of State for the Colonies if he will make a statement on the situation in Cyprus.
    Mr. Lennox-Boyd: The terrorist organisation EOKA has intensified its campaign of intimidation, by increasing its attacks against Cypriots and against the police force and vehicles of the Security Forces. The number of murders by the terrorists now total 75, of whom more than half have been Greek-Cypriots, and those wounded total 226. Perhaps the most vicious incident was the shooting down of a Greek-Cypriot policeman inside a nursing home where he had just visited his wife and newly-born baby. The inhumanity of the terrorists is also shown by their bomb throwing and shooting with an increased disregard of the danger to Cypriot civilians. Instances of this kind have caused the deaths of two Cypriot children.
    In order to assist the Security Forces in their investigation of terrorist crime, curfews and restrictions of vehicle movement have been imposed as necessary; and three villages have recently been fined. There was some inter-communal rioting In Nicosia following on the terrorist murder of a Turkish-Cypriot policeman, and a strict curfew was enforced in Nicosia, together with a ban on certain places of entertainment.
    The Governor of Cyprus is coming to London shortly to keep my colleagues and myself fully up to date on the situation.
    Mrs. Jeger: While deeply regretting this tragic recital that we have had to hear once again from the right hon. Gentleman, may I ask whether he will not now consider the possibility that the reopening of negotiations would itself contribute towards the ending of violence? How many more lives have to be lost before hon. and right hon. Gentlemen on the Government benches appreciate that their present policy stands no chance of being successful or effective?
    Mr. Lennox-Boyd: I have no reason whatever to think that constitutional talks, which have been up to now quite unproductive, would themselves bring an

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    end to violence. There is this difference between the last statement I made to the House and this one: now it is possible to see real signs of abhorrence by ordinary moderate opinion in Cyprus at the methods being used by the terrorists. That is a good thing.
    Viscount Hinchingbrooke: While not wishing to go as far as the hon. Lady, the Member for Holborn and St. Pancras, South (Mrs. L. Jeger), and while warmly applauding every action that my right hon. Friend has taken to maintain law and order, may I ask whether he does not think that the time has arrived for the Government to make a fresh move on the constitutional and political front? Will he be able, while the Governor is here, to promulgate in greater detail the Government's constitutional proposals?
    Mr. Lennox-Boyd: I do not know whether my noble Friend was in the House earlier when I answered a Question somewhat along those lines. If he was not, perhaps he will read it. As to the second question, all who have had dealings with Sir John Harding will know very well that no subject in the island for which he is responsible can be excluded from any talks that I am likely to have with him.
    Mr. J. Griffiths: While sharing the deep regret which has been expressed and joining in the appeal for cessation, may I ask the right hon. Gentleman whether he would particularise as to what caused the rather disturbing inter-communal riots? Taking a long view, it will be a pity if they lead to deep-seated trouble between Turks and Cypriots in Cyprus. Will the right hon. Gentleman give instructions to the Governor that an attempt ought to be made once more to reopen negotiations to bring the trouble to an end?
    Mr. Lennox-Boyd: It is a very disturbing sign. One of the most fruitful causes of misunderstanding and ignorance in this country and elsewhere is the lack of knowledge of the Turkish position and of Turkish feelings, and of the proximity of Cyprus to the Turkish mainland.

    Mental Hospital
    Mr. K. Robinsonasked the Secretary of State for the Colonies when work is expected to start on the new mental
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    hospital in Cyprus; how long it will take to complete; and what will be the estimated cost.
    Mr. Hare: Work had been planned to start last month; but urgent building work for the Armed Services and internal security purposes now makes it unlikely that a start can be made this year. The first phase of building, which will consist of the treatment and administrative blocks and some ward accommodation, will take 18 months and is estimated to cost £300,000.
    Mr. Robinson: Is the Minister aware that there will be great disappointment at this delay? Is he further aware that the existing mental hospital in Cyprus is a disgrace to the Commonwealth, and that the medical superintendent is trying valiantly to carry out modern methods of physical treatment in conditions which are utterly appalling and impossible? Will he say whether a start on the new hospital cannot be expedited?
    Mr. Hare: I share the hon. Gentleman's great disappointment, but it was not possible to start on this work last month as was planned. I can assure him that everything possible will be done to make a start as soon as possible.

    Emergency Laws (Arms)
    Mr. K. Robinsonasked the Secretary of State for the Colonies whether the emergency law in Cyprus prohibiting the carrying of arms, under penalty of death or imprisonment for life, applies equally to Greek and Turkish Cypriots.
    Mr. Hare: I am sending the hon. Member a copy of Emergency Regulation 52, from which he will see that the Regulation applies to any person who carries arms without lawful authority.
    Mr. Robinson: In that case, can the right hon. Gentleman explain how it comes about that a reputable correspondent reported that during the disorder in Cyprus about four weeks ago a Turk was seen openly brandishing a pistol and that the Security Forces took no action?
    Mr. Hare: The hon. Gentleman will probably like to know that nine Turkish Cypriot private individuals have been given licences to carry personal arms. One of those may well be the Doctor

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    Kutchuk who was, I think, the gentleman referred to in the newspaper report which the hon. Gentleman has mentioned. We are in correspondence with the Governor about this, and I will certainly give the hon. Gentleman information as soon as we hear whether or not that assumption is correct.

    Constitution
    Mr. Edeasked the Secretary of State for the Colonies if he has yet set someone to work to draft a constitution, along the lines of the correspondence between the Governor of Cyprus and Archbishop Makarios, to serve as a basis for ultimate renewed negotiations.
    Mr. Lennox-Boyd: Before I last went to Cyprus, and in the hope that agreement would then be reached on the restoration of law and order, and a start made on constitutional discussions, I asked Lord Radcliffe if he would be prepared to act as Constitutional Commissioner in the island. He very generously agreed to do so. Negotiations in Cyprus, as the House well knows, broke down. It then became clear that the paramount duty of the Government, to which all else had to be subordinated, was the restoration of law and order.
    No constitution is likely to have validity or strength unless it is produced from genuine discussions by those who will be responsible for working it. Detailed drafting of a constitution cannot therefore be undertaken until genuine discussion is possible and there has been a fair measure of agreement on fundamental issues. The offer in the White Paper which still stands provides a framework for a constitution, and we are of course studying how this could be elaborated once discussions are possible.
    Mr. J. Griffiths: May I repeat my earlier question? When the Governor is over here, will the right hon. Gentleman consider whether it is possible to reopen negotiations with the Ethnarchy?
    Mr. Lennox-Boyd: I can only repeat the answer I gave previously to the right hon. Gentleman.
    Mr. Wadeasked the Secretary of State for the Colonies whether he will take immediate steps to make the details of Her Majesty's Government's present proposals for a new constitution for
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    Cyprus more widely known; and whether he will broadcast the same to the people of Cyprus.
    Mr. Lennox-Boyd: The proposals are embodied in the correspondence, published and widely circulated here and in Cyprus, in the White Paper, Cmd. 9708. The hon. Gentleman is probably not aware that the Governor drew attention to these proposals in a broadcast to the people of Cyprus on 5th March.
    Mr. Wade: Would the right hon. Gentleman explain what positive action is being taken now, apart from the use of the Armed Forces, which, I believe, are being called on to perform a task which is almost impossible? If Her Majesty's Government have formulated proposals which go a long way towards meeting the desire for self-determination, what steps are being taken to make these known day by day to the people of Cyprus?
    Mr. Lennox-Boyd: I have already answered three or four questions more or less on that subject. The proposals in the White Paper were widely known throughout Cyprus and, had the Ethnarchy been anxious to bring about a settlement, they could have been made even more widely known through the various sources which the Ethnarchy commands.
    Mr. Hastings: Is the right hon. Gentleman making full use of the radio to inform and remind the people of Cyprus of the terms on which Her Majesty's Government are prepared to open negotiations again?
    Mr. Lennox-Boyd: Of course the radio is in constant use for bringing home to the people of Cyprus the very wide measure of self-government which we have offered, but I will look into the particular suggestion which the hon. Member has made.

    Phrenaros (Report)
    Mrs. Jegerasked the Secretary of State for the Colonies what reports he has now received on ill-treatment of the villagers of Phrenaros by British personnel on 27th-28th March.
    Mr. Lennox-Boyd: The allegations referred to were against members of the military forces who were searching this village, where a lieutenant and a private

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    had just been ambushed and killed. I understand that the detailed report to my right hon. Friend the Secretary of State for War has not yet been completed. Further reports which I have had from the Governor indicate that the burning down of a coffee shop may have been caused accidentally by a stove. Claims for damage or loss of property arose chiefly from the need to break open the doors of locked premises in the owners' absence. These and any other allegations are still being investigated.
    Mrs. Jeger: Is the right hon. Gentleman aware that, besides allegations of damage to property, there were several allegations of harm done to persons? If I send him an affidavit from a doctor in Famagusta who examined some of these people and reported their injuries, will he consider it with the other evidence?
    Mr. Lennox-Boyd: I will certainly consider it.

    Deportations (Human Rights)
    Mr. Holtasked the Secretary of State for the Colonies whether the action of Her Majesty's Government in deporting Archbishop Makarios and others from Cyprus and detaining them in the Seychelles has been notified under the terms of the Convention for the Protection of Human Rights and Fundamental Freedoms; how, and when such notification was made; and what steps were taken by him to bring such action to the attention of the other signatories of the Convention.
    Mr. Lennox-Boyd: In accordance with "Article 15 (3) of the Convention, notification was made by note to the Secretary General of the Council of Europe on 13th April. This action fully discharged Her Majesty's Government's obligations under the Convention.
    Mr. Holt: Do I understand from that. Answer that no other signatories to the Convention were informed by Her Majesty's Government? Is the Secretary of State aware that the Secretary-General has not passed this information on to anyone and the most unfortunate impression has got abroad that this was due to the influence of Her Majesty's Government? Does he not think that when serious steps like this are taken in regard to human rights it is most desirable that it should be done openly?
    Mr. Lennox-Boyd: This was certainly done openly, and we have fully discharged our obligation. There is no obligation at all under the Convention for Her Majesty's Government to inform other signatories of the notification. As to what happened to our notification afterwards, that is not for me to say, but I know that there is nothing in the Convention which lays down what should happen to notifications after they have been submitted to the Secretary-General.
    Dame Florence Horsbrugh: Is it not the case that, this subject having been brought up at the Council of Europe, it was made absolutely clear that Her Majesty's Government did notify these facts, that the Secretary-General had received the facts, and that there was no feeling whatever that Her Majesty's Government had not done everything they should do under the Convention?
    Mr. Lennox-Boyd: I am very grateful to my right hon. Friend for that.

    Curfews
    Mr. Fernyhoughasked the Secretary of State for the Colonies if he will direct the discontinuance of the imposition of curfews on the civilian population in Cyprus.
    Mr. Lennox-Boyd: No, Sir. In present circumstances curfews play a necessary part in helping the Security Forces to prevent and to detect terrorism.
    Mr. Fernyhough: Is the Secretary of State aware that these curfews impose untold hardship and inconvenience on thousands of innocent people, thereby increasing the bitterness and hatred? Does he not realise that this is a supreme example of the failure of the policy of repression? Does he not think the time has come when we should remember what happened in Ireland and in America and do the sensible thing?
    Mr. Lennox-Boyd: I have nothing to add to my statement.

  NIGERIA

    Road Improvements (Grants)
    Mr. John Hallasked the Secretary of State for the Colonies whether he will make a grant from the Colonial Development and Welfare Fund to the Northern Region of Nigeria to improve the roads.
    Mr. Hare: I would refer my hon. Friend to the reply given to the hon. Member for Kirkdale (Mr. N. Pannell) on 25th April.

    Commercial Legislation
    Mr. Tilneyasked the Secretary of State for the Colonies whether, at the Nigerian Constitutional Conference to be held in London this autumn, he will invite the Regional Governments to consider the need for unification of commercial legislation in Nigeria.
    Mr. Lennox-Boyd: Much commercial legislation is already generally applicable throughout Nigeria, but if my hon. Friend will specify the legislation he has in mind, I will certainly consider his request.

    Building Societies, Lagos
    Mr. Tilneyasked the Secretary of State for the Colonies whether he will make arrangements to enable a building society to be established in Lagos.
    Mr. Hare: I understand that there is already one building society in Lagos and that the Federal Government have been considering the establishment of another.
    Mr. Tilney: Has my right hon. Friend's attention been drawn to the report of the Colonial Development Corporation relating to the difficulties it has had in Lagos?
    Mr. Hare: Yes, it most certainly has. As my right hon. Friend said, it is hoped to be able to introduce legislation in this House later which will, I think, deal with the difficulty which has arisen at the present moment.

    Apapa Wharf, Lagos
    Mr. N. Pannellasked the Secretary of State for the Colonies what action is being taken to minimise the delays which take place to cargo awaiting railment up-country from Apapa Wharf, Lagos.
    Mr. Hare: I am advised that there is now no delay at Apapa Wharf.

    Motor Cars (Imports)
    Mr. Russellasked the Secretary of State for the Colonies the total number and value of motor cars imported into Nigeria in 1955, or any recent period of
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    twelve months; and what proportion of these came from the United Kingdom and the United States of America, respectively.
    Mr. Hare: The information asked for is as follows:

    IMPORTS OF MOTOR CARS INTO NIGERIA DURING 1955

    —

    Number

    Value

    £

    Total imports

    6,670

    3,642,319

    Imports from U.K.

    4,012

    2,067,273

    Imports from U.S.A.

    654

    468,729

    Mr. Russell: Does my right hon. Friend not agree that this is a very important market for British car exports, with its large population of over 30 million? Should not the motor car industry take every possible advantage to get into this market and meet foreign competition?
    Mr. Hare: I could not agree more with my hon. Friend. I hope that the motor car industry will do all it can to encourage the sales of cars in this territory.
    Mr. E. L. Mallalieu: Does not that answer show that the British motor car industry is being as unenterprising in this market as it is in most other overseas markets?
    Mr. Hare: I do not think that is fair. The figures which I have just given show that more than half the motor cars in Nigeria are being supplied from the United Kingdom. Still, that is no reason for complacency, and we hope that the United Kingdom motor car industry will increase its sales.

    Mission Schools
    Mr. Biggs-Davisonasked the Secretary of State for the Colonies how many mission schools in the Eastern Region of Nigeria have recently been closed, or are to be closed, and for what reason.
    Mr. Hare: A number of mission schools in Calabar Province have been closed because the local authorities were unable to collect the education rate. I cannot give the exact number, but it is not large. The Regional Government have recently introduced new financial

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    measures which they hope will enable the schools to re-open shortly and will prevent the closing of any others.

    Public Corporations, Eastern Region
    Mr. N. Pannellasked the Secretary of State for the Colonies how many public corporations have been set up in the Eastern Region of Nigeria; for what

    Name of Body

    Purpose

    Source of Finance

    1. Eastern Region Marketing Board.

    To buy and sell certain agricultural produce.

    Mainly from the difference between the buying and selling prices of the commodities with which it deals.

    *2. Eastern Region Development Corporation.

    To formulate, promote and execute development projects.

    Periodic grants from the Marketing Board and its predecessors.

    *3. Eastern Region Finance Corporation.

    To finance development projects companies, etc.

    £2m. grant from the Marketing Board.

    4. Eastern Nigeria Printing Corporation.

    To print and publish material of all kinds.

    Loan of £200,000 to be made by the Finance Corporation.

    5. Pharmaceutical Corporation

    To manufacture and sell drugs

    Loan of £50,000 to be made by the Finance Corporation.

    6. Cinema Corporation of Nigeria

    To produce and exhibit films

    Loan of £100,000 to be made by the Finance Corporation.

    7. Tourist Corporation of Eastern Nigeria.

    To promote tourism

    Loan of £100,000 to be made by the Finance Corporation.

    8. Eastern Nigeria Information Service.

    To provide news and publicity for the Region.

    1. Annual votes from Government Revenue.

    2. £100,000 interest free loan to be made by the Finance Corporation.

    9. Sports Commission

    To encourage amateur sport

    Grant of £50,000 from the Finance Corporation.

    10. Eastern Region Library Board

    To establish and maintain public libraries.

    Grant of £35,000 from the Finance Corporation.

    * The Finance Corporation will be merged with the Development Corporation when the Eastern Region Development Corporation (Amendment) Law 1956, which was passed by the House of Assembly in March, 1956, comes into operation.

    SOMALILAND (CONSTITUTION)
    Mr. Brockwayasked the Secretary of State for the Colonies if he will now make a statement regarding the extension of self-government to Somaliland and the association of the Protectorate and the Trust Territory for this purpose.
    Mr. Lennox-Boyd: I have nothing to add to the reply given to the hon. and learned Member for Brigg (Mr. E. L. Mallalieu) on 25th January.
    purpose; and how they have been financed.
    Mr. Hare: There are ten such statutory bodies. As the other details are long and complicated, I will, with permission, circulate them in the OFFICIAL REPORT.
    The following have been set up by the Government of the Eastern Region of Nigeria:
    Mr. Brockway: In view of the fact that the delegation from Somaliland came here in January, and that it was then indicated that a statement would subsequently be made, will the right hon. Gentleman make a statement at any early date, reassuring the people of British Somaliland that they will have an opportunity to join the people of the Trust Territory if they so desire?
    Mr. Lennox-Boyd: We are here building for the future, and I think it is extremely important that great care and

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    consideration should be given to the statement which I shall make, which will not be very long delayed.

    COLONIAL TERRITORIES (BUILDING SOCIETIES)
    Mr. Tilneyasked the Secretary of State for the Colonies if he will make a statement on the loans advanced by the Colonial Development Corporation for establishing building societies in Colonial Territories.
    Mr. Lennox-Boyd: I would refer the hon. Member to the reply which I gave on 18th April to my hon. Friend the Member for Essex, South-East (Mr. Braine).

  NYASALAND

    Mr. Chibambo
    Mr. Brockwayasked the Secretary of State for the Colonies for what period Mr. M. Q. Y. Chibambo, who was deported to the Southern Province of Nyasaland in July, 1953, after serving a sentence of 15 months for sedition, is to be subject to the restriction order which confines him to an area of two miles of Port Herald and requires him to report daily to the police.
    Mr. Lennox-Boyd: The restriction order on Mr. Chibambo is reviewed by the Governor in Council every six months.
    Mr. Brockway: Is it not a fact that Mr. Chibambo was originally arrested for a speech which he made in criticism of the proposals for the Central African Federation? He has served fifteen years in prison—[HON. MEMBERS: "No."]—he was immediately picked up and has been kept in detention ever since. [HON. MEMBERS: "Fifteen months."] I am sorry. He has been kept in detention for fifteen months. Is it not time that this sentence was reviewed?
    Mr. Lennox-Boyd: The hon. Member is quite wrong. He is not now in detention, but he is subject to this restriction order, and I am not prepared to interfere in a matter of this kind. I believe this man to be a very dangerous agitator, and in the present situation I am not prepared to ask the Governor to review his decision other than at regular intervals, as he now already does.

    District Commissioners, Fort Johnston
    Mr. Chichester-Clarkasked the Secretary of State for the Colonies how many District Commissioners there have been at Fort Johnston in the last eight years; and what steps he is taking to obviate frequent changes.
    Mr. Lennox-Boyd: There have been nine District Commissioners at Fort Johnston in this period. Shortage of staff and the incidence of leave sometimes make frequent changes unavoidable, but Fort Johnston has suffered particularly from the retirement and illness of District Commissioners.
    Mr. Chichester-Clark: Does not my right hon. Friend agree that frequent administrative changes are in general undesirable, and that elsewhere they may have been a factor in the spread of Mau-Mau?
    Mr. Lennox-Boyd: Yes, that is by no means improbable. I have every sympathy with the Government of Nyasaland who, despite the most Herculean efforts, are still on the administration side, seventeen below strength. It is up to me in particular, and all those responsible, to do all we can to supplement their staff.

    ST. LUCIA (UNITED STATES BASE)
    Mrs. Castleasked the Secretary of State for the Colonies whether he is aware that the United States contractors now installing radar equipment at Vieuxfort, St. Lucia, are paying their workers 17 cents an hour; how this compares with other rates of pay in the island; and what steps were taken to see that adequate wages were paid by United States firms before permission was given to reactivate this base.
    Mr. Lennox-Boyd: Unskilled labour employed at the United States base has been paid at the rate of 17 cents an hour, semi-skilled and skilled labour receiving higher rates. A 25 per cent. increase has been granted to all categories with effect from 12th March. The rates paid compare favourably with other rates of pay in the island. The Notes exchanged with the United States Government before the base was reactivated provide that wage rates shall be determined by agreement

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    among the United States and British authorities, including the Administrator of the island.
    Mrs. Castle: I welcome the fact that this low rate of pay has since been increased by 25 per cent., but is the Colonial Secretary aware of the fact that there is grave discontent in the island at the low rates of pay which are being paid by these wealthy American contractors, and that even a 25 per cent. increase upon a rate of about 6s. a day is inadequate for modern needs? Will the Minister have the matter looked at again?
    Mr. Lennox-Boyd: I am always anxious to see the standard of living of every West Indian island steadily rise, but it is extremely important to be realistic and to realise the need for the American authorities' wages to be based upon those operating elsewhere in St. Lucia. I have no reason to think—indeed, quite the contrary—that their rates are unfair, judged by this criterion.

    TANGANYIKA (STUDENTS)
    Mr. J. Johnsonasked the Secretary of State for the Colonies why there were only 16 Africans from Tanganyika studying in the United Kingdom in Session 1955–56 while there were 155 from Uganda; and how many of the 16 Tanganyikans were here on Government scholarships.
    Mr. Hare: Revised figures indicate that 19 Africans from Tanganyika are at present studying here, if whom thirteen have scholarships from the Tanganyika Government or under the C.D. and W. Acts. There are, however, at present 131 African students from Tanganyika at Makerere.
    Mr. Johnson: Is it not a fact that few Tanganyikans get higher education? What is the right hon. Gentleman doing in the way of expanding secondary education, particularly for the good sixth forms and the secondary schools? Will he tell us what plans he may have, or possibly has, for future higher education in Tanganyika itself?
    Mr. Hare: I have great sympathy with what the hon. Gentleman has said. He will be glad to hear that the output from secondary schools is expanding consider
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    ably. It should result in a marked increase in those who go on to higher education.
    Mr. Johnson: Are there any plans for higher education inside Tanganyika?
    Mr. Hare: If the hon. Gentleman will put down a question on the matter, I should like to answer it in detail.

  SEYCHELLES

    Chief Justice
    Mr. J. Johnsonasked the Secretary of State for the Colonies if he will arrange for the transfer to other duties of the Chief Justice of the Seychelles in view of the fact that out of fourteen appeals from his recent judgments only one has been upheld.
    Mr. Hare: No, Sir.
    Mr. Johnson: Is the Minister not aware of the dissatisfaction both inside and outside the island about the conduct of affairs in the sphere of justice and other matters? Would he be good enough to consider sending out a commission of inquiry to this island? In view of the fact that the French-speaking plantocracy appear to govern the island, it might be possible, if the talks did not result in satisfaction, for the Government to consider giving the island back to the French.
    Mr. Hare: I do not follow the hon. Gentleman there. It is only fair he should know that during the last seven years the Chief Justice has tried 1,561 cases and that only fourteen of the litigants have thought fit to appeal.

    Allegations
    Mr. E. Fletcherasked the Secretary of State for the Colonies if he will appoint an independent commission to inquire into the allegations of maladministration in the Seychelles, including the continuing acts of prosecution of and discrimination against non-Roman Catholics.
    Mr. Hare: If the hon. Member will give me the details of whatever allegations he may have in mind, I shall look into them.
    Mr. Fletcher: I am obliged to the Minister and will certainly give him the details. I can assure him that a number of my hon. Friends and myself are

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    receiving a number of complaints about the injustice and lack of tolerance which exist in the Seychelles. I hope he agrees.
    Hon. Members: Question.
    Mr. Speaker: Order. The hon. Member should ask his question.
    Mr. Fletcher: Would not the Minister agree, when he receives this information, that the best way of allaying this anxiety will be by the appointment of an independent commission?
    Mr. Hare: If the hon. Gentleman will be good enough to give me the allegations which he has mentioned, perhaps I shall be able to answer the latter part of his question.

    BAROTSELAND PROTECTORATE (HOSPITALS)
    Dr. Strossasked the Secretary of State for the Colonies (1) what proposals the Government of Northern Rhodesia have to provide adequate hospital accommodation at Mongu in the Barotseland Protectorate;
    (2) whether he will make a statement on the condition of the buildings and equipment of the Government hospital in Mongu in the Barotseland Protectorate.
    Mr. Hare: The provision and maintenance of hospitals in the Barotseland Protectorate is now the responsibility of the Federal Government.
    Dr. Stross: Can the hon. Gentleman tell me whether it is possible for the territorial Government to spend money to give assistance to the Federal Government? Secondly, is he aware that many parts of this hospital are said to be in decay and that some of the buildings are falling down? Is there any way in which we can be of assistance?
    Mr. Hare: As I have explained to the hon. Gentleman, this matter is within the responsibility of the Federal Government and not of the Home Government. Therefore, it does not come within the purview of my Department.
    Mr. Hale: Will the hon. Gentleman remember, in making further grants to purposes in Northern Rhodesia, to impose a condition that there is no colour bar and no segregation in any institution in respect of which United Kingdom funds are granted?
    Mr. Hare: That point does not arise out of the question.
    Mr. Hale: No, but just remember.

    BUGANDA (SAZA CHIEFS)
    Mr. H. Fraserasked the Secretary of State for the Colonies how many Saza chiefs in all have been deposed by the Government of Buganda.
    Mr. Lennox-Boyd: None; but five have resigned since the return of the Kabaka in October last year. Two had passed the retiring age and a third had completed 30 years' service.
    Mr. Fraser: Would not my right hon. Friend agree that to say "resign" is a considerable euphemism, in view of the pressure put upon these persons to resign? Would he not look at the Buganda Appointments Board which is supposed to be like our Civil Service Commission but consists largely of the Kabaka's relations, who may have been wreaking vengeance on people who have supported this country in the past?
    Mr. Lennox-Boyd: I made a very carefully considered statement on this matter on 30th November, and as my hon. Friend knows, I was also in touch with certain very important people in Buganda on the matter. I am glad that nothing further has happened since last December, but I cannot pretend to be happy at what happened before that.

  KENYA

    British and African Troops
    Mr. Chichester-Clarkasked the Secretary of State for the Colonies how many British and African troops were being employed against Mau Mau in June, 1955; and how many it is anticipated will be employed in the same period in 1956.
    Mr. Lennox-Boyd: The total for fighting troops are 6,443 British and 5,363 African in June, 1955, 1,455 British and 3,330 African in June, 1956.
    Mr. Chichester-Clark: Does not that show a remarkable improvement in the situation?
    Mr. Lennox-Boyd: Indeed it does. I am sure the whole House congratulates

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    the soldiers and others concerned, and not least the Government of Kenya, and the people of all races who are co-operating in the multi-racial experiment in Kenya for which my noble Friend Lord Chandos is so largely responsible.

    Chief Mundia (Sentence)
    Mrs. Castleasked the Secretary of State for the Colonies the nature of the offence for which Chief Mundia was sentenced on 28th February last; why the evidence was heard in camera; and whether it is now intended to rescind his appointment as chief.
    Mr. Hare: Chief Mundia pleaded guilty to a charge of common assault. Defence counsel asked that part of the evidence as to character to be offered before sentence should be taken in camera in the public interest. This evidence related to the Chief's part in combating terrorism in his location. The court, acting under powers conferred on it by the Criminal Procedure Code, agreed to hear this small part of the evidence in camera.
    On review, the Supreme Court held that in this instance there were no materials before the Resident Magistrate on which to consider whether a prima facie case existed for hearing evidence in camera, but held that that evidence had added nothing material to the case.
    In view of his outstanding record of service, it is not intended to rescind Chief Mundia's appointment.
    Mrs. Castle: But is not the Minister aware that Chief Mundia was originally charged with causing actual bodily harm, and that then, at the request of the District Commissioner, the court went into camera to hear evidence on which the charge was reduced? In view of the fact that Chief Mundia has been associated with previous breakdowns in the rule of law, does not the right hon. Gentleman think that the strange conduct of the case—with which, apparently, the Supreme Court later disagreed—is one more sign that the administration of justice in Kenya is not being carried out on proper lines?
    Mr. Hare: I cannot agree with the hon. Lady. It is true that the charge was altered, but that was in view of the trivial nature of the injuries inflicted, and the prosecution decided on that evidence that
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    the charge should be altered. I think it is absolutely unfair for the hon. Lady to make this widespread condemnation on such grounds.
    Mrs. Castle: Is it not very unusual for evidence of this kind to be heard in camera? Why was it considered necessary to do so at all? If Chief Mundia is above question, which some of us doubt, why was not that evidence taken in public?
    Mr. Hare: Again, I think that the hon. Lady probably did not quite hear the reply which I gave. In the view of the Supreme Court there was not sufficient evidence for this part of the case to be held in camera. The reason that prompted the magistrate to decide that that part should be held in camera was that it dealt with the actual security position in the location in which the Chief was operating.
    Captain Waterhouse: Is it not very easy for indignation to be registered in this House by people who do not at all appreciate the conditions existing in that locality?

  BRITISH GUIANA

    Emergency Regulations
    Mr. Allaunasked the Secretary of State for the Colonies what relaxation of emergency regulations has been made in British Guiana.
    Mr. Lennox-Boyd: I would refer the hon. Member to the reply which I gave to Questions by the hon. Members for Cannock (Miss Lee), South East Essex (Mr. Braine) and Eton and Slough (Mr. Fenner Brockway) on 25th April. Since then two restriction orders on movement have been lifted, thus reducing the number of such orders to six.
    Mr. Allaun: But if the election which the Minister announced last week is to be a real election and not a sham, must he not restore full freedom to all the political parties to prepare for it? Would he, for instance, end the confinement of eight leaders of the two largest parties in Georgetown and Buxton?
    Mr. Lennox-Boyd: There is a Question later on with regard to possible restrictions on candidature, and I would prefer to wait until then.
    Miss Lee: Does the Secretary of State confirm that all the political leaders, including Mr. Burnham and Mr. Jainarine Singh, have now freedom of movement, and that only Mr. and Mrs. Jagan and some of their supporters are now confined? Would he further explain why he wishes to give this artificial advantage to the Jagan party in British Guiana, because obviously this is the best possible way to maximise their prospects in the election?
    Mr. Lennox-Boyd: I would most indignantly deny that the Governor has been in any way guided by any party political considerations in the Colony. The restrictions have been based or decided solely on whether or not the individual in question is judged to be a danger to security.

    Constitution
    Mr. Braineasked the Secretary of State for the Colonies whether he will make a statement on constitutional progress in British Guiana.
    Mr. Lennox-Boyd: I would refer the hon. Member to the reply which I gave to the Question by the hon. Member for Salford, East (Mr. Allaun), on 25th April.
    Miss Lee: Has the Minister had any reactions from the main political parties and leaders in British Guiana whether they are willing to co-operate in the elections? Will he once again try to put the various parties on an equal footing by stopping the restrictions on certain of them?
    Mr. Lennox-Boyd: I can only repeat what I said previously. No considerations of a political kind enter into whether or not detention orders or restriction orders are made. Judgment is solely on the individual and the danger which that individual might or might not provide to security. It is a little early as yet to say anything about the general reactions. I am not anxious in any way unduly to hurry what must be at best a very bold experiment.
    Mr. Braine: Will my right hon. Friend confirm that since the raising of the ban on the holding of meetings there has been no disturbance of any kind? Is he aware that there is general approval on all sides
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    of the House of this step-by-step return to normalcy?
    Mr. Lennox-Boyd: I think that is indeed so.

    Elections
    Mr. Sorensenasked the Secretary of State for the Colonies if any alterations in the franchise will accompany the proposals for an elected Legislative Council in British Guiana; whether nominations for candidature will be without restrictions; what will determine the inclusion of the five elected members in the Executive Council other than their election to the Legislature; and whether there will be any restrictions imposed on the power and function of the Government.
    Mr. Lennox-Boyd: There will be universal adult suffrage as before, but I shall be considering with the Governor whether there should be any addition to the usual disqualifications for election. The Governor will appoint to the Executive Council those elected members of Legislative Council whom he considers can best serve the country. The powers and functions of the Government will be as at present.
    Mr. Sorensen: Will these particulars be given in a form in which we can examine them more closely? Do I take it that in regard to general elections there is no alteration contemplated?
    Mr. Lennox-Boyd: If there are to be additional restrictions they will be written into the amending Order in Council, which will be laid before Parliament.

  NORTHERN RHODESIA

    Riot Damages Ordinance (Communal Fines)
    Sir L. Plummerasked the Secretary of State for the Colonies the nature of the discussions that he had with the Government of Northern Rhodesia prior to the passing of the Riot Damages Ordinance, 1955, which gives the Governor powers to impose communal fines on all inhabitants of an area in which there has been riot damage.
    Mr. Hare: The Governor submitted the Ordinance to my right hon. Friend in draft to which he agreed subject to certain amendments.
    Sir L. Plummer: Does not the Minister agree it is inconsistent with British ideas of justice that innocent people should be punished for the offences of the guilty? Does he not also agree that collective punishment should be used only in the most serious of crises, and will he not now have further discussions to see whether this retrogressive legislation cannot be withdrawn in the Colony?
    Mr. Hare: This Ordinance was produced only after a prolonged series of incidents in which drivers of motor cars were assaulted by crowds of Africans after being involved in accidents. And all the incidents have so far occurred in the railway belt, generally where there are unauthorised settlements of de-tribalised Africans along main roads. It was only after a very careful consideration that the Governor decided to bring in this Ordinance.

    Rioting (Sentences)
    Sir L. Plummerasked the Secretary of State for the Colonies the result of the appeals of the 18-year-old Brown Kapena who was sentenced to nine years' hard labour for riotously damaging mine property and for rioting at Nchanga. Northern Rhodesia, of the two other Africans also sentenced with him to nine years, of the seventeen other Africans sentenced to five years' hard labour, and of the other thirteen sentenced to two years' hard labour; and if the recommendations by the magistrate that all these sentenced men should be deported at the expiry of their sentences is to be carried out.
    Mr. Hare: All these sentences were reduced on appeal. As the details are rather lengthy, I will, with permission, circulate them in the OFFICIAL REPORT. One Nyasaland African will be deported on the expiration of his sentence; the deportation of four other Nyasaland Africans is still under consideration.
    Sir L. Plummer: Is the right hon. Gentleman aware that these chaps were between 18 and 20 years of age, that the riots started as a result of an African being killed by a white crane driver, and that the row that then followed illustrates the tension that exists between Africans and white men in Northern Rhodesia? Will he not now ask his right hon. Friend to exercise his clemency in the direction of trying to pacify the Africans, who are
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    feeling that they are being run over far too often by white drivers who, to put it mildly, are a little careless?
    Mr. Hare: The hon. Gentleman will see from my reply that, in fact, there have been substantial reductions in sentence. But I would not like the House to get the idea that this was not a really serious riot. It was a riot which lasted about five hours, and a number of people were injured, some seriously, in the attacks. I would also point out that among the injured was an official of the African Mine Workers Union, Mr. Ben Chilongo, who was injured while asking the crowd to disperse.
    Following are the details:
    On appeal to the High Court Brown Kapena's sentence was reduced from nine to five years' hard labour, and the other two Africans who were also originally sentenced to nine years' hard labour had their sentences reduced to four years' hard labour.
    Of the 17 Africans sentenced to five years' hard labour, two were acquitted, five had their sentences reduced to three years and ten reduced to two years.
    Of the twelve Africans sentenced to two years' hard labour, five were acquitted, two had their sentences reduced to fourteen months and five were reduced to twelve months.

    Native Reserves (Amendment) Order
    Mr. Rankinasked the Secretary of State for the Colonies (1) whether he is aware that the provisions of Northern Rhodesia (Native Reserves) (Amendment) Order in Council, 1955, have the effect of allowing a corporation controlled by the Federal Government to administer the Kafue Gorge Hydro-Electric Scheme; that this is not in accordance with the Order in Council which requires that the control should be in the hands of the Government of Northern Rhodesia; and whether it is proposed to alter any of the remaining safeguards to African lands established at the time of the formation of the Federation which kept with the Secretary of State the ultimate responsibility for the use of land alienated from the Northern Rhodesian Native Reserves and Trust Lands for public purposes;
    (2) what Africans were consulted before the enactment of the Northern Rhodesia (Native Reserves) (Amendment) Order in Council, 1955; and whether they agreed to its provisions.
    Mr. Hare: The amending Order in Council was designed to clear up a doubt regarding the scope of the power conferred by the Northern Rhodesia Native Reserves Order in Council, 1928, on the Governor to set aside land in native reserves for "public purposes." These purposes were defined in the Order as including the purposes of a corporation controlled by the Government of Northern Rhodesia.
    The Federal Constitution lays down that for the purposes of the African land laws any reference to "public purposes" includes a reference to Federal public purposes. It was doubtful, however, whether the two provisions could be read together so as to make the phrase include the purposes of a corporation controlled by the Federal Government, such as the Federal Hydro-Electric Board. The native authorities in the Gwembe valley, who are particularly affected by the amendment, had already agreed that the land needed for the Kariba Hydro-electric Scheme could be set aside. Further consultation in the legal technicality was therefore not considered necessary.
    There is no intention of altering any of the safeguards to African land established at the time of the formation of the Federation.
    Mr. Rankin: Is the Minister aware that as a result of the execution of this desirable project 30,000 Africans in Northern Rhodesia and 10,000 Africans in Southern Rhodesia will be rendered homeless? What is he seeking to do to provide them with alternative accommodation?
    Mr. Hare: If the hon. Member puts down a Question, I shall be delighted to give him plenty of details of what plans are in mind for settling those who have to move from the area affected by the scheme.
    Mr. J. Griffiths: Will the hon. Gentleman publish in the OFFICIAL REPORT, Or indicate in reply to a Question, what steps are being taken to find alternative accommodation and work for the Africans displaced, a matter upon which my hon. Friends and I have given him information?
    Mr. Hare: I think my right hon. Friend replied to those representations. If the right hon. Gentleman puts down a Question, I shall be only too pleased to give the information.
    Mr. Rankin: In view of the fact that my supplementary question arose directly from the main Question, I must regard the answer as quite unsatisfactory and beg to give notice that I shall raise the matter on the Adjournment.

    HONG KONG (POLLING STATION)
    Mr. Rankinasked the Secretary of State for the Colonies the date when the polling station in the outlying district of Wanchai in Hong Kong was moved into the central district.
    Mr. Hare: The change was notified in the Hong Kong Government Gazette of 27th January.
    Mr. Rankin: Is the Minister aware that in replying to me on 14th December his right hon. Friend said that the two polling stations concerned were in the most densely populated part of Hong Kong, and that the change of location of this one took place only a month or six weeks after he made that statement in the House of Commons?
    Mr. Hare: I am not quite sure what the hon. Gentleman is getting at, but if he would be good enough to have a word with me afterwards I would be only too delighted to discuss it with him.

    WEST INDIES (FEDERAL CAPITAL)
    Mr. Braineasked the Seretary of State for the Colonies when the commission to report on a site for the federal capital in the British West Indies will be set up.
    Mr. Hare: I hope very shortly.
    Mr. Braine: Since the London Conference decided that Federation should come into force no later than the end of March, 1958, is not my hon. Friend aware that that gives very little time for the selection and, if necessary, building of a capital? Can he say whether there are any plans for a provisional capital pending such a decision?
    Mr. Hare: No. I think we want first of all to set up the commission. I am glad to be able to tell my hon. Friend that the West Indian Governments have

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    been consulted about the choice of persons to serve on the commission and have approved generally. Letters of invitation are being prepared for issue to the three persons with the experience required.
    Mr. Royle: Can the hon. Gentleman say when legislation will be introduced to set up the Federation?
    Mr. Hare: I cannot give the hon. Member a definite date.

    UGANDA (ELECTIONS)
    Mr. Fenner Brockwayasked the Secretary of State for the Colonies if he will make a statement on the proposed constitutional changes in Uganda.
    Mr. Lennox-Boyd: I assume that the hon. Member is referring to the statement about elections which the Governor made with my full authority on 24th April. I prefer not to attempt a summary of this statement within the compass of an answer to a Parliamentary Question and would invite the hon. Member to read the full text, of which copies have been placed in the Library.
    Mr. Brockway: Will the right hon. Gentleman consider including it for circulation in HANSARD? Is he aware that this announcement has been received with profound disappointment by the African population in Uganda, particularly by the Uganda National Congress, whose sweeping victory at the last election shows that it has the support of the people?
    Mr. Lennox-Boyd: I think the time-honoured way of circulating this sort of document is in the Library. There is a limit to what we can include in HANSARD. Answering the second part of the question, I hope the hon. Gentleman will not fall into the error of the Uganda National Congress which, on the very day that the document was first made known, condemned it in toto before it could possibly have had time to read it properly, let alone study it. Any such irresponsible tactics go ill with their claim to be representative African leaders.
    Mr. J. Johnson: Will the Minister keep in mind the fact that a unitary State, as
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    opposed to a Federal State, is better for Uganda, since only in this way will the wealthy Buganda State carry and help the weak States of Ankole and Toro?
    Mr. Lennox-Boyd: There is certainly much to be said for that point of view.

  ATOMIC ENERGY AUTHORITY

    State and Private Industry (Relationship)
    Mr. Albuasked the Lord Privy Seal what division of activity as between research, development and construction, is proposed between the Atomic Energy Authority and private industrial firms in the development of new types of atomic reactors.
    The Lord Privy Seal (Mr. R. A. Butler): I have nothing to add to the information I gave to the hon. Member for Ashfield (Mr. Warbey) in reply to his Question on 14th March.
    Mr. Albu: Will the right hon. Gentleman not agree that it is very important to avoid the situation which has arisen in the aircraft industry, in which too few scientists and development engineers are working on too many research projects? In order to avoid that, is it not very important that there should be a very clear line of demarcation between work done by the manufacturing companies and work done by the Atomic Energy Authority?
    Mr. Butler: Yes, Sir. I am aware of this, and so are the Government. I gave as clear an answer as I could on 14th March and, pending any further development, I am unable to give the hon. Member any further information at present. I will, however, bear in mind what he says.
    Mr. Warbey: Have the Government yet been able to decide where the demarcation line should be drawn in respect of the ownership and operation of nuclear reactors?
    Mr. Butler: So far as it is possible to define this question, I did so in my answer on 14th March, which I have before me.

    Germany (Talks)
    Mr. E. Fletcherasked the Lord Privy Seal what conversations have taken place with the United States authorities regarding the discussions between the Atomic Energy Authority and the representatives of the German Federal Minister for Atomic Energy.
    Mr. R. A. Butler: There have been no conversations with the United States authorities on this subject.
    Mr. Fletcher: Does not the right hon. Gentleman think it rather important that we should keep in step with the United States Government, with whom we are in such close and cordial relations about atomic research generally, before we have these discussions with the Germans?
    Mr. Butler: The point is that negotiations with the German authorities are at a very early stage and, therefore, there is no reason for consultation with the United States authorities now. Whether we shall have need for consultation with them or not will appear as we see the situation developing in talks with the Germans.

    Mr. M. Kurchatov (Harwell Address)
    Mr. Warbeyasked the Lord Privy Seal to what extent the research work of the Atomic Energy Authority on the use of energy derived from controlled thermonuclear fusion will be assisted by the information given at Harwell by the Soviet atomic scientist, M. Kurchatov.
    Mr. R. A. Butler: The exchanges of view which took place with Mr. Kurchatov were, I hope, of interest and value to all concerned.
    Mr. Warbey: In the light of Press reports of this rather remarkable practical example of co-operative co-existence, would it not be useful to make the text of the address available to anyone interested in the subject and also to see whether the Atomic Energy Authority is now in a position to make equivalent information known to the world of science?
    Mr. Butler: Yes, certainly, I shall see that the address, a copy of which I can obtain quite easily, is placed in the Library of the House.

    Central Electricity Authority (Programme)
    Mr. Warbeyasked the Lord Privy Seal what assistance will be given by the Atomic Energy Authority to the expanded programme of atomic power now envisaged by the Central Electricity Authority.
    Mr. R. A. Butler: The Central Electricity Authority has made no announcement of any expansion in the nuclear power programme beyond that envisaged in the Government's White Paper of February, 1955 (Cmd. 9389). If such an expansion were decided upon, I understand that the Atomic Energy Authority would continue to give as much help and advice as possible.
    Mr. Warbey: Is the Lord Privy Seal saying that Press reports of a planned expansion to the extent of another £100 million by the Central Electricity Authority on the issue of atomic power stations are incorrect, or can he say whether such an expansion is under consideration?
    Mr. Butler: I cannot go further than the Answer I have given up to date and the information I have already given the House. When I have something authentic to say, I shall add it to what I have already said.

    MALTA (CONSTITUTION)
    Mr. Sorensenasked the Secretary of State for the Colonies if he will make a further statement in respect of constitutional changes in Malta.
    Mr. Lennox-Boyd: I have nothing to add to the statement made to the House by my right hon. Friend the Prime Minister on 28th March.
    Mr. Sorensen: Does the Secretary of State appreciate that this matter is of such very great importance, both to this country and to Malta, and that hon. Members should be invited to hear what progress has been made towards the adoption of the proposals or otherwise?
    Mr. Lennox-Boyd: We are making quite considerable progress, but I am not yet in a position to make a statement. I saw with interest that in the Maltese

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    Assembly on 4th April Mr. Mintoff said that legislation,
    "may take about a year to put through."
    This is a very big business, but it must be done.
    Mr. E. L. Mallalieu: Will the right hon. Gentleman assure the House that Her Majesty's Government will not support a proposal to change the electoral system in Malta in order to get an overwhelming majority to the integration proposals?
    Mr. Lennox-Boyd: I have another Question on that.

BUSINESS OF THE HOUSE
Proceedings on the Restrictive Trade Practices Bill exempted, at this day's sitting, from the provisions of Standing Order No. 1 (Sittings of the House).—[Mr. R. A. Butler.]
ORDERS OF THE DAY

  RESTRICTIVE TRADE PRACTICES BILL
  Considered in Committee. [Progress 1st May.]
  [Sir CHARLES MACANDREW in the Chair]

  RESTRICTIVE TRADE PRACTICES BILL

    Clause 10.—(RECTIFICATION OF THE REGISTER, ETC.)
    3.34 p.m.
    Mr. George Darling: I beg to move, in page 9, line 16, to leave out "High" and to insert "Restrictive Practices".
    The Chairman: I think it will be for the convenience of the Committee if this Amendment is taken with the Opposition Amendment to line 20 and that in page 10, line 1.
    Mr. Darling: Yes, Sir Charles.
    Many hon. Members are lawyers and know more than I do about the workings of the High Court and of the proposed Restrictive Practices Court. They will probably say that I am all wrong in suggesting that, when dealing with alterations to trade agreements, applications for these alterations should go to the Restrictive Practices Court and not to the High Court. As far as I can see—it has been said frequently—the whole of the procedure provided for in the Bill will give the lawyers a great deal of work and will add considerably to their income. It seems to me that we are giving them an unnecessary amount of work and that we are not getting the purpose of the Bill properly in focus if we suggest that applications for the alteration of agreements should go to another court. It seems to us on this side that this is a matter, like everything else in the Bill dealing with the legal procedure, that could be, and ought to be, dealt with in the Restrictive Practices Court.
    I believe that the Bill is giving far too much work and income to the lawyers, who will have a very good time when it comes into operation and the registration of agreements, questions of exceptions and all the rest have to be thrashed out. It seems to some of us, at any rate, that all this will add unnecessarily to the legal burdens which are imposed upon the industrial community by the Bill. I therefore want to know why the Government

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    consider it necessary for applications for the alteration of agreements to go to a court other than the one which has been set up to deal with the Bill.
    If I am wrong, I shall be quite happy for the Minister to say so, but I object to this unnecessary expansion of legal work, with which I disagree entirely. I disagree with the whole of the legal procedure which is provided for in the Bill.
    Mr. A. J. Irvine: I support the Amendment and those of the remarks of my hon. Friend the Member for Hillsborough (Mr. G. Darling) which were not derogatory to my profession. One thing which I should have thought would be quite clear about the activities of the new Court which it is proposed to set up is that its work will be very specialised in character. The Court will have regard to questions which will be quite novel in coming before the judiciary. That being so, and the matters arising under the Bill, when it becomes law, being in this way of a specialised character, I should have thought it was very desirable that all parts of the proceedings should be confined to the Restrictive Practices Court.
    It would seem to me undesirable administratively that, by the Bill in its present form, applications would be made, probably at 2 o'clock, to judges of the High Court, with the imposition upon these judges of the determination of interlocutory matters arising as a result of this innovation in the law, when, I should have thought, it was far more convenient that these matters should be dealt with by the Restrictive Practices Court itself.
    Once that Court is created and has started building up its body of case law and its methods of procedure and practice, it will get to know, if I may so express it, the way of the Bill, when it becomes an Act, and matters arising under it, which should carry weight and which would require attention, and it will be able, I should have thought, to deal with this kind of problem much more expeditiously than would the High Court.
    The applications which are to be made under the Clause could raise very difficult questions. The matter referred to in the first subsection, as to whether particulars should be removed from the register, may often involve elaborate and
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    extensive research into the subject matter of the application. If that were all, I should have thought that to impose that burden upon the High Court judges would be undesirable and might quite well result in an unsatisfactory dislocation of the lists and of the ordinary programme of the High Court.
    It is, however, not all, because under a subsequent subsection, to which another of the Amendments which we are now discussing refers, applications may go to the High Court upon the very extensive question whether an agreement is one which is registrable under Clause 4. That may often involve very thorough investigation and extensive research.
    Moreover, the Bill provides that notice of the application must be given to the Registrar, and he will have the right and the power to appear and to resist the application. In that context, we are getting quite a distance away from the short type of ex parte application which can be conveniently dealt with by the judges of the High Court in our usual procedure. We may well have an issue arising as to whether a complex agreement is a registrable agreement under the Bill, with a party to the agreement taking one point of view and the Registrar taking another. This is quite inappropriate for application to the High Court when there is in existence, as there will be, a Restrictive Practices Court accustoming itself to the procedure and the types of problem that will arise.
    In determining whether particulars should be removed from the register, and whether a particular class of agreement or particular agreement is registrable, the judge will often derive very great assistance from the advice he receives from the lay members of the Court. Why should the High Court judge, as proposed by the Bill, dealing with what may be complex difficulties, not have the advantage of turning to lay members of the Restrictive Practices Court to assist him in making a decision on the matter?
    I suggest to the President of the Board of Trade that there may be many occasions where the class of application will give rise to points which are quite peculiarly appropriate to be considered and dealt with by lay members whom the Government propose to place on the Restrictive Practices Court. The Government have recognised in principle—and

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    I agree with that decision—that it is desirable in many instances to have sitting with the judge lay members with experience of trade and commerce and public affairs. If that view is taken in principle, what can be the reason for concluding, as the Government by this Clause in effect conclude, that these lay members may not be helpful on the interlocutary and ancillary matters arising from these applications?
    3.45 p.m.
    I ask the Government to consider these arguments and to reflect upon their weight. The point is a narrow one, but it is not unimportant. Here we are considering a matter which may have a considerable effect on the list of cases in the High Court and upon the conduct and the movement of the business there. We are considering how best to deal with applications which, by their very nature, may be very involved and may require extensive and prolonged examination in certain circumstances.
    Mr. Eric Fletcher: I am sorry to say that on this point I do not find myself in agreement with my hon. Friend for Edge Hill (Mr. A. J. Irvine.) I take some credit myself for saying so, because I think that it illustrates to the President of the Board of Trade that we on this side of the Committee are trying to look at this matter in a constructive and helpful and not in a partisan manner. Although I have listened very carefully to my hon. Friend the Member for Edge Hill and my hon. Friend the Member for Hillsborough (Mr. G. Darling), I frankly disagree with them and I hope that the President will not accept the Amendment.
    May I dismiss as irrelevant the first argument of my hon. Friend the Member for Hillsborough, who made one of the usual cheap jibes about the legal profession? I do not think that it makes any difference from that point of view whether these applications go to the High Court or to the Restrictive Practices Court or any other court. Therefore, I do not think that that point is relevant.
    There are, however, two other points which I think are very relevant. We on this side of the Committee, of course, do not approve of this Restrictive Practices Court at all in principle. We should prefer a tribunal, but the Government must have their way because they have
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    a majority. But having got a Restrictive Practices Court, I think that it will have plenty to do in dealing with the cases that come before it—these semi-justiciable, semi-law and semi-economic issues.
    We think that the sooner that Court gets on with dealing with the mass of applications that will come before it the better. Therefore, from that limited point of view of the Restrictive Practices Court being able to utilise its time to the best advantage, I should prefer that the Court should not be cluttered up, to use the Parliamentary Secretary's favourite phrase, with adventitious matters.
    I should prefer that these applications of a totally different character, as to whether or not a particular agreement should be registered, should go to the High Court. Those issues are much better decided by a High Court judge sitting alone, because those issues will involve strictly justiciable matters—matters of the precise interpretation of the phraseology of the Bill when it becomes an Act. They will not involve any economic issues at all. They will involve simple matters of construction which can be suitably decided by a High Court judge, without any benefit of any assessor.
    An arrangement of that kind would have another advantage. Once the Bill is passed and becomes part of the ordinary law, the more it is integrated into the whole of our legal machinery the better. Therefore, the more judges of the High Court there are dealing with the interrelated aspects of the Bill the better, and I should be against segregating before a particular court all the issues that arise from the Bill. If there are to be people who ignore their duty of registration and become liable to penalties for having defaulted in furnishing particulars, those people should be dealt with by the ordinary courts.
    Equally, if there are issues as to whether a particular agreement should be registered or not, such matters should come before the ordinary courts, that is, the High Court, because those issues are totally different in nature from any issue as to whether a particular agreement is or it not contrary to public policy.
    There may well be a number of applications under Clause 10, and the fact that they will come before a different court is, in my opinion, an advantage

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    rather than a disadvantage. The whole apparatus which is being set up—though very belatedly—to deal with monopolies is something which should, as far as possible, be integrated with our whole legal system. I am anxious that the public should come to realise that the application of this Bill is a matter of great national importance, not just a matter of legal importance, though it must obviously involve legal issues.
    I am anxious that this Measure should be so assimiliated with our legal system that public opinion will come to regard with revulsion offences of a monopolistic character and the making of agreements which are evil in their nature in that they offend against public policy. Therefore, I think that the more courts there are dealing with these matters and the more publicity is given to them in different courts, the better; and the arrangement proposed in the Bill would be a better arrangement than trying to pretend that this is some purely segregated element of our system in which offences are not as serious as other kinds of offence.
    I admit that the matter is arguable, and I apologise to my hon. Friends for not agreeing with them, but, for those reasons, I personally hope that the President will not feel able to accept the Amendment.
    Mr. Frederick Mulley: I support my hon. Friend the Member for Islington, East (Mr. E. Fletcher); and I say that now because I should not like it to be thought that he was the only black sheep on this side of the Committee. I was impressed by the arguments advanced in support of the Amendment, but the main reason prompting me to speak against it is my concern about the three courts which are to be available to deal with restrictive practices. I would hate to find their time occupied by considering matters of a purely legal nature which should rather be dealt with in the ordinary way by the High Court. Moreover, unless the drafting of the Bill is greatly improved by the Report stage, it seems to me that most of these matters will in any case have to go to a higher court than the courts of first instance of the High Court before anyone is sure what particular exceptions may mean.
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    I would, therefore, ask the President not to look too sympathetically at this Amendment. At the same time, I would ask him to tell us what he has in mind as regards the High Court itself. Will it be the Queen's Bench Division or the Chancery Division? Subsection (2) of the Clause seems to raise matters of construction, rectification of registers, and so on, which are very similar to some of the company matters dealt with by the Chancery Division, and the Chancery Division might well be the more appropriate division to deal with matters raised under this Clause.
    Mr. M. Turner-Samuels: I was very sorry to hear my hon. Friend the Member for Hillsborough (Mr. G. Darling) say what he did about lawyers. It really is most extraordinary what an almost perverted delight some people seem to take in throwing jibes at lawyers. It lies ill in the mouth of any trade unionist to throw jibes at lawyers, because the influential and strong position which trade unions enjoy today is due in large measure to the successful battles in the past waged in the courts on their behalf.
    Mr. Ellis Smith: Only because the trade unions organised these things, often against the opposition of lawyers.
    Mr. Turner-Samuels: I do not think that there is any need for acerbity about this matter. I am surely entitled to reply to the strictures made upon my profession.
    I cannot agree for one moment with this Amendment, which seeks to substitute the Restrictive Practices Court in these particular instances for the High Court. I am sorry to have to differ from my hon. Friend the Member for Hillsborough and with my hon. Friend the Member for Edge Hill (Mr. A. J. Irvine). My hon. Friend, rather strangely, referred to his Amendment as raising a narrow point, but, rather than being narrow, its effect seems to go to the whole width of this Bill. If the President were agreeable to doing what the Amendment asks, it would mean that there might be no ultimate purpose served by the Bill at all, and in that case we might just as well go back to the Monopolies Commission and keep the Monopolies and Restrictive Practices Act in full operation.

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    The provisions of that Act could, if they were fully implemented by the President and if the recommendations and reports of the Commission were endorsed by him, fulfil quite adequately and, in my submission, even better than the provisions of this Bill, the purpose behind this whole piece of legislation.
    Although, like my hon. Friend the Member for Islington, East (Mr. E. Fletcher), I do not agree with the High Court being brought into this Bill at all, and I do not agree with the provisions of the Bill as a whole, my submission being—as I said it on Second Reading—that it would have been perfectly all right to continue the status quo, and to allow the Monopolies Commission to operate in the fullness of the provisions of the Act if adequately implemented by the President of the Board of Trade.
    To say that this is a narrow point is, I submit, quite wrong, because it would, in effect and in practice, get rid of a salient feature of this Bill altogether. If we are to have this Bill—and we have already passed an important proportion of it—not in a mangled state but in operative form, then it is clear that this Clause, which is a pivotal one in the implementation of the machinery it seeks to set up, must stand. The only thing we can hope is that the general treatment of this matter in the way proposed in the other provisions of the Bill, by a mixed tribunal consisting of High Court judges and lay members, will, notwithstanding that it is a branch of the High Court, be effective to achieve the purposes which the President of the Board of Trade and the Government tell us they have in mind in order to promote the pubic interest in cases of restrictive trade practices.
    4.0 p.m.
    Mr. Wilfred Fienburgh: I do not propose to follow my hon. and learned Friend the Member for Gloucester (Mr. Turner-Samuels) in his totally inaccurate historical resume of the formation of the trade union movement. Indeed, I remember being asked, not long ago, to review a book on the structure of trade unionism written by my hon. and learned Friend, and, having found 49 errors of fact in the first 30 pages, I decided that the book needed not reviewing but rewriting, and I therefore consigned it to the ash-can, where
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    it lay for some time. We will, I think, leave these matters aside.
    There is one question I wish to raise about this Clause and the Amendment. The more the lawyers talk about this Bill the more worried I become, as a layman, about the number of different instruments which are now being harnessed to the prosecution of the ending of restrictive practices. When we tally up the imposing list of authorities—Ministers, institutes and bodies of the law—we begin to reach a quite overwhelming total. There is the President of the Board of Trade, who will have some influence and power over ordering the regulation of the registration of restrictive practices; there is the Registrar, with the function of investigation, registration and, to some extent, prosecution—although we think that he has not enough power of prosecution; there are the ordinary courts of law, involved in considering any restrictive agreement in which patent law is involved, and, finally, the Restrictive Practices Court itself. We are now proposing to introduce the High Court, and, ultimately, we have the House of Lords, which is rather heavily involved in sorting out the provisions of the Bill.
    Mr. Douglas Jay: And the Monopolies Commission.
    Mr. Fienburgh: Yes, as my right hon. Friend reminds me, the Monopolies Commission will still be left with some slight powers even after the President of the Board of Trade has tried to emasculate it.
    I wish to draw sustenance—as one so easily can in this Bill—from the words of the President himself. He put up a much better argument than I could for leaving this matter to be dealt with by the Restrictive Practices Court. In dealing with the question whether there should be a court or a tribunal, on the lines suggested by hon. Members on this side of the Committee, he said:
    "Either we have a court of law, which is part of the judiciary, which is in that estate of the realm, which has the powers and privileges of the High Court, including powers with regard to contempt, and so on, or we have a tribunal which is answerable to a Minister."—[OFFICIAL REPORT, 12th April, 1956; Vol. 551, c. 411.]
    After the way in which the Committee dealt with our Amendments we are left

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    with the first alternative. In effect, by the definition of the President, the Restrictive Practices Court is also a court of law, part of the judiciary, which is in that estate of the realm, and has the powers and privileges of the High Court, including powers to deal with contempt. If that is so, why is it necessary to refer this point to the High Court? Why cannot it be left to the Restrictive Practices Court, which has all the powers of the High Court, and which should surely be able effectively to deal with the matter, without lumbering still another body on to the bandwagon which is attempting to deal with restrictive practices?
    Mrs. Barbara Castle: While the lawyers are falling out about this matter, I should like to refer to something which is puzzling my simple mind. This Clause strikes me as being completely absurd. We are here dealing with agreements which should never have been put on the register. There are only two ways in which agreements can get on the register, under the provisions of the Bill. The first is by the parties to the agreement furnishing particulars. We had a lot or argument about that obligation and phraseology yesterday. It is quite clear that the parties to an agreement will not furnish particulars about it if they do not think that it is subject to registration—so they will not be able to come along later, as aggrieved parties, saying, "Our agreement should never have been put on the register; take it off." There will be no appeals upon that basis.
    The second way in which agreements can get on the register is by the Registrar serving a notice upon a party to remedy his default in not furnishing particulars. That intervention of the Registrar becomes effective only through its being backed up, where necessary, by an order of the High Court. If to furnish particulars is the same as to register—and we are told by the President that it is—the Clause is providing, in fact, either that the party who has volunteered his registration can appeal to the High Court and say that he should never have been registered, or that the High Court, having ordered a party to register, can afterwards be appealed to by him, on the ground that it should never have made that order.
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    The Clause is, therefore, providing for a situation in which either a party to an agreement is appealing against himself, or the High Court is being appealed to to annul its own order. I may be simple, or I may be talking sense, but I should have thought that that was a peculiar situation to get ourselves into. I cannot see why we have to bring in the High Court at all.
    According to the interpretation of Clause 5, surely the decision whether an agreement is subject to registration is, first, the responsibility of the parties, and, failing that, of the Registrar, who should step in and force the parties to act. They will then be put on the register. There is no stigma about being on the register. The fact that agreements are on the register does not necessarily mean that they are contrary to the public interest. The process of deciding whether or not they are comes at a later stage in the Bill. I should have thought that the fact that an agreement was on the register, backed if necessary by an order of the High Court, produced a situation which did not in itself create injustice.
    The question whether or not action should be taken against the agreement is a very different kettle of fish, and one which has to be dealt with later by the Restrictive Practices Court. But surely the two decisions could be merged into one, and be dealt with by the Restrictive Practices Court. When that Court examines an agreement on the register and decides whether or not it is contrary to the public interest, it will take into account the question whether that agreement falls within the terms of Clause 5. I see absolutely no reason for bringing in the High Court at this stage to rectify a grievance which will either have been created by the party appealing or by an action of the High Court itself.
    The Parliamentary Secretary to the Board of Trade (Mr. Derek Walker-Smith): I do not think that I should enter into the internecine warfare which broke out on the benches opposite upon the old subject of lawyers. The Committee may agree that, taken by and large, lawyers are good and necessary people in courts of law, and in dealing with matters of law. Whether they take an undue proportion of the time of the deliberations of the Committee is a matter upon which there may be two opinions.
    Mr. A. J. Irvine: The hon. and learned Gentleman will surely distinguish between the wheat and the chaff.
    Mr. Walker-Smith: I do not think that I want to be tempted into this delicate field.
    In answer to what was said by the hon. Member for Hillsborough (Mr. G. Darling), I would point out that in regard to matters such as costs there is nothing in it in the issue which is before the Committee at present. Whichever court it may be, a party is fully entitled to appear in person—although, in practice, no doubt parties would more frequently be represented by counsel, and it would no doubt be the same counsel whichever court was concerned. So I do not think anything turns on matters of costs. Also, nothing turns on matters of appeal because, whichever court the appeal went to, the channel of appeal would be precisely the same.
    Mr. G. Darling: Surely the hon. and learned Gentleman will agree that the more complicated one makes the legal procedure, the more chances there are of lawyers getting bigger incomes.
    Mr. Walker-Smith: I am hoping to show in a moment that, on balance, this is the quicker and simpler method of dealing with the matter.
    As the hon. Member for Edge Hill (Mr. A. J. Irvine) has said, this is a narrow point. I agree with him that it is an important point, but it is purely a point as to which, in practice, taking all the circumstances into account, will prove to be the better and quicker method. I think that the Committee is agreed that speed is one of the main objects of this exercise.
    I would remind the Committee of the matters with which the court, whichever court it may be, will be dealing. It will be dealing with the matters defined in the first two subsections of Clause 10. First it will be dealing with the removal of particulars of agreements which have been wrongly registered either because they do not come within Clause 5 or because they should be exempted under Clause 6. Secondly it will be dealing with the determination in advance of whether or not agreements should be registered.

    If I might deal with the point raised by the hon. Lady the Member for
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    Blackburn (Mrs. Castle) the dilemma which she suggests does not I am glad to say arise in practice. If she will look at Clause 8 (5 b), to which she did not refer the Committee, she will see how particulars could get on the register by the action of the Registrar, and give rise to an application by a party to the agreement as a person aggrieved seeking their removal.
    In either of the tasks under those subsections, what the court, whichever one it is, will have to do is to construe the agreement or memorandum as defined in Clause 8 (3), possibly supplemented by further particulars under Clause 11 (2). That being so, the task which the court has to perform, as the hon. Member for Islington, East (Mr. E. Fletcher) observed, is not only a justiciable issue, but is actually concerned with a point of law because it is the construction of an agreement.
    I rather part company with the hon. Member for Edge Hill in his analogies with ex parte applications and interlocutory proceedings in the High Court, because these are not quite that sort of thing. These are substantive questions of law, of construction of agreements, and they will not be made ex parte in five minutes at two o'clock, as the hon. Gentleman seemed to have in mind. They will be matters of substance, but they will be matters of law.
    That being so, the next question that arises, it being a question of law, is: what is the most appropriate tribunal to decide it? Normally, questions of law are matters for the judges of the High Court, and that is the pattern which we propose to follow here. The Restrictive Practices Court will, it is true, be presided over by a judge of the High Court, but it will be a mixed court having lay members.
    I agree with those hon. Gentlemen who presumed to differ from the hon. Member for Edge Hill that there will not be a useful task for the lay members in this function. This is the construction of agreements, and it would be a waste of time for these eminent laymen with knowledge and experience in commerce, industry, and so on, to be applying themselves to matters for which they are not equipped by training to deal.
    Mr. Hector Hughes: What function does the hon. and learned Gentleman say that the lay members will perform? Will they sit there mute? Will they take no intelligent interest in what is going on? Will they leave the construction of the agreements entirely to the judicial member of the court? If so, why should they sit at all?
    4.15 p.m.
    Mr. Walker-Smith: I think that the hon. and learned Member is under a misapprehension as to the side on which I am arguing. It is precisely because I want to save the lay members from the embarrassment of sitting mute and unhelpful that I agree with hon. Members opposite who have suggested that the appropriate tribunal here is the High Court and not the Restrictive Practices Court.
    I think that the Committee has in mind an important point which was referred to by the hon. Member for Edge Hill, among others. It is true, as he said, that it is desirable for there to be a certain familiarity of background in the judges dealing with these matters. It is not for me to answer the precise questions raised by the hon. Member for Sheffield, Park (Mr. Mulley) as to the division of the High Court to which these matters should go. That is obviously a matter for the Lord Chancellor to deal with. I would, however, remind the Committee that there are precedents for nominated judges dealing with certain matters, thus ensuring that they have a proper familiarity with the subjects with which they are dealing.
    There are, for example, three judges assigned to company duties in the Chancery Division, and there is one judge nominated for war damage cases in the Chancery Division. It would be open to the Lord Chancellor—this is entirely a matter for him—to nominate judges to deal with these matters. It would, in fact, be open to him, if he so desired, to nominate judges who are members of the High Court. He is entitled to do that under Clause 3.
    I suggest that this is the best solution to the problem and that it avoids the possibility of loading the Restrictive Practices Court in the early stages with a lot of purely constructional work on agreements, points of law, and so on,
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    which would waste the time of the lay members and possibly retard the functions of the court in dealing with the cases which actually come before it.
    There are obviously arguments on both sides, and we have thought very carefully about the matter, but we have come inescapably to the conclusion to which certain hon. Members opposite have come. In these circumstances, I hope that the hon. Member for Hillsborough will be satisfied with the explanations that I have given and will not desire to press his Amendment.
    Mrs. Castle: Will the hon. and learned Gentleman clarify his answer to me? I am more puzzled than ever. Did I understand him to say that the answer to the dilemma to which I referred is in Clause 8 (1, b)?
    Mr. Walker-Smith: I referred the hon. Lady to Clause 8 (5, b).
    Mrs. Castle: Would the hon. and learned Gentleman mind explaining that a little more clearly, because I do not see how it deals with the point at all?
    Mr. Walker-Smith: Clause 8 (5, b) gives power to the Registrar in certain circumstances to treat particulars as if they had been furnished to him. That means that he is then entitled to put them on the register albeit that they will not have been furnished by the party to the agreement. If the party to the agreement then says, "I did not furnish those particulars because I thought, as a matter of law, that the agreement did not come within the provisions of Clause 5," then the method of adjudicating upon that would be under Clause 11 (1).
    Mrs. Castle: Does that not raise the point that this can only be done upon the authorisation of the High Court? Will it not be a question of the High Court wiping out a decision of the High Court? Will the hon. and learned Gentleman answer that question?
    Mr. G. Darling: I cannot say that I am satisfied with the Parliamentary Secretary's answer, especially on the last matter. The point raised by my hon. Friend the Member for Blackburn (Mrs. Castle) ought to be answered.
    I am concerned to make the procedure as simple as possible for everybody. I would like the situation in relation to

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    the work of the Restrictive Practices Courts to be such that little groups of ordinary firms with agreements which they want to make sure are not against the public interest could go to the Court without the benefit of lawyers. They should be able to express themselves and every facility should be given to them. I cannot pursue that at this stage.
    I want to make this as simple as possible. I do not want it to become a complicated piece of legal procedure under which the lawyers alone—and I say this deliberately—will find happiness. I think that, in spite of the explanation we have had, this is an unnecessarily complicated legal procedure. In these circumstances, although I do not think that we ought to press the Amendment to a Division, I hope that the hon. and learned Gentleman will understand me when I say that I cannot withdraw the Amendment.
    Mr. Jay: I would ask the Parliamentary Secretary to make a little more clear his answer to my hon. Friend the Member for Blackburn (Mrs. Castle). As I understand Clause 8 (5, b), it applies entirely to a case where default has been made in registration. It says that if there is such a default, then the Registrar may
    "treat as particulars duly furnished to him under this Part of this Act any document or information in his possession relating to the agreement."
    It appears from that that the Registrar may. in these circumstances, properly enter on the register information which would not normally be registrable under the Bill. If that is so, does it mean that the person who has defaulted may go to the High Court and argue that that information should be removed because it is not in the normal definition of the Act subject to registration? It appears to me as a layman rather odd that if the Registrar is in order in entering information not subject to registration, it can then be immediately removed for that reason.
    Mr. Walker-Smith: I do not want to go into the technicalities of these matters. Subsection (5) is dealing simply with the default of furnishing particulars, and the application to the High Court then made by the Registrar could, in my judgment, be an ex-parte application of the sort referred to by the hon. Member for Edge Hill (Mr. A. J. Irvine) and then the
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    particulars would be upon the register. If the parties want a question of law argued not ex-parte but with both parties present or represented, the procedure under Clause 10 (1) would arise, or in the more frequent case where the Registrar, having been notified by the parties that a question of law does arise—in other words, they are taking the point that the agreement is not within Clause 5—then it would be argued under subsection (2). I am sorry if I expressed myself in a rather compressed way and did not make the point clear on a former occasion.
    Amendment negatived.
    Mr. Peter Remnant: I beg to move, in page 9, line 17, after the second "the" to insert "variation or".
    The Chairman: I think it would be convenient if this Amendment and the following Amendment were considered together.
    Mr. Remnant: Subsection (1) of this Clause is limited in a way that is not only unnecessary, but is unwise as well. First, it obviously appears to be restricted to agreements which are not subject to registration under the Bill. It is not a difficult task to visualise instances in which it may be required, quite rightly, to make alterations in agreements which are registrable.
    For instance, a person's name may be included as a party to an agreement which is properly registrable and he himself may claim that he has ceased to be a party to that agreement. It would seem to me right that he should be able to go to the Court and ask for his name to be deleted from the agreement. It may be that wrong particulars have been supplied. I am not suggesting that they would have been registered intentionally wrongly, but the party responsible for sending the agreement to the Registrar may not have had in his possession all the facts, or they may have been included inadvertantly, and in those circumstances also it would seem right that there should be the opportunity of correcting them before they are judged by the Court.
    The second thing which strikes one forcibly is that this subsection only gives permission for the removal of particulars, and I should have thought it was plain that there ought to be permission for the particulars to be varied as well as

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    removed. If my right hon. Friend and the Board of Trade are influenced in any way by precedents, there is a precedent for this in the Patents Act, 1949. I do not think I need say any more to explain the object of these two Amendments. The first Amendment cured the ills referred to, and the second one is purely consequential.
    The President of the Board of Trade (Mr. Peter Thorneycroft): My hon. Friend the Member for Wokingham (Mr. Remnant) points out what I think are perfectly fair criticisms of the Clause as drafted, and I think that his argument will commend itself to the Committee. If it is reasonable that some procedure should be there for rectifying the register—I think it is plain that we must have procedure for rectifying the register—then it is sensible that the rectification of what is recorded should apply to both the registrable and unregistrable part of any agreement. It would be a gloomy thing if we left it that the only method was to remove it. It may be that what is wanted is some variation in the terms, and these Amendments make it possible to achieve that in this Clause.
    Amendment agreed to.
    Further Amendment made: In page 9, line 18, leave out from "agreement" to end of line 19.—[Mr. Remnant.]
    Mr. Charles Doughty: I beg to move, in page 9, to leave out lines 43 and 44 and to insert:
    "shall be served, in accordance with rules of court—

    (a) in the case of an application by a person other than the Registrar, on the Registrar;

    (b) in the case of an application by the Registrar, on the parties to the agreement or such of them as may be prescribed or determined by or under the rules;

    and any party on whom notice is so served."
    As we have heard in the course of the discussion on this Clause, there is power both for the Registrar and for the parties interested to make application to the High Court for the cessation, removal or variation of any particular agreement that has been registered or not registered.
    When that application is made, it is only right and proper that all the parties interested should have the power of appearing before the Court and being heard in support of or in opposition to
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    the application. As the Clause is drafted, notice of any application to the Court other than application by the Registrar shall be served on the Registrar. There is no provision in the case of an application by the Registrar of notice being served on the parties interested which must consequently follow upon the application by the Registrar.
    The Amendment provides for that particular set of circumstances, and it sets out in full what the procedure should be in either case. In the case of any application by persons other than the Registrar, notice would be served in accordance with the rules of the Court on the Registrar. He will receive an application and will appear, if he thinks fit, to express his views to the Court.
    4.30 p.m.
    In the case of an application by the Registrar, the question has to be considered on whom that notice of application should be served. In such circumstances, it should be served on such parties interested
    "as may be prescribed or determined by or under the rules."
    It is necessary to leave it in that form because there may be a large number of parties every one of whom may not be known to the Registrar, and every one who is known or can reasonably be found out is sufficient for the purposes of this Clause. All such persons should be entitled to be heard and then the Court may have the full facts and submissions before it.
    Mr. P. Thorneycroft: Again, I hope that the Committee will accept the Amendment, because it is clear that this should be a two-way arrangement. Where the application is by a party he can serve notice on the Registrar, and if the application is by the Registrar he should serve notice on the party. That seems a reasonable arrangement. There are certain complications which arise from the fact that there may be a large number of parties and some may be unknown to the Registrar. That is why, in paragraph (b), my hon. and learned Friend leaves the precise arrangements to be prescribed for under the rules.
    Amendment agreed to.
    Further Amendments made: In page 10, line 1, after "Scotland", insert "and Northern Ireland respectively".
    In line 3, at end add:
    "or the High Court of Northern Ireland ".[Mr. P. Thorneycroft.]
    Clause, as amended, ordered to stand part of the Bill.

    Clause 11.—(POWER OF REGISTRAR TO OBTAIN INFORMATION.)
    Mr. P. Thorneycroft: I beg to move, in page 10, line 6, after "person", to insert:
    "being—
    (a) a person".
    It may be convenient if, with this Amendment, the Committee discuss the proposed Government Amendments to line 8 and line 31.
    The combined purpose of the Amendments is quite simple. It is to ensure that when the Registrar wishes to obtain information, and has reasonable cause to believe that a person has a registrable arrangement or agreement, he should be able to serve notice on an association as well as on a person. In the case of a trade association which is not an incorporated body, there is probably no substantial difficulty, since the agreement to which the association purports to be a party is probably the agreement entered into by the parties. In that case, it would probably be possible to serve it on the parties. But I think, and I hope that the Committee will agree, that it should be clear beyond a peradventure that if the Registrar wishes to do so, and thinks the information could be obtained from an association, he may be able to do that with an association as with any other party to the agreement.
    Amendment agreed to.
    Further Amendment made: In page 10, line 8, after "Act", insert:
    "; or
    (b) a trade association within the meaning of the said section five the members of which consist of or include persons carrying on business as aforesaid or representatives of such persons".—[Mr. P. Thorneycroft.]
    Sir John Barlow: I beg to move, in page 10, line 23, at the beginning to insert "if".
    The Temporary Chairman (Major Anstruther-Gray): I think it would be for the convenience of the Committee if, with this Amendment, we discussed the next Amendment, in the name of the hon.
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    Member for Huddersfield, West (Mr. Wade), to the same line, and the two following Amendments, to lines 25 and 30, in the name of the hon. Member for Middleton and Prestwick (Sir J. Barlow).
    Sir J. Barlow: These three Amendments deal with what I consider to be a very important point. If the Registrar wishes to enter the business premises, or the home, as the case may be, of anyone to get information which he has reason to expect may be there, he has at present the right to authorise his representative to do so. It will be remembered that the right of entry in this country has always been very jealously guarded. In recent years it has been somewhat extended, perhaps more so than some of us would like; but we feel that, although his right of entry is absolutely necessary in certain cases, it should be carefully guarded.
    For that reason, instead of the Registrar allowing his authorised representative to enter such premises, the effect of these Amendments is to secure the authority of the High Court on information on oath, to allow anyone to enter for this purpose. In my submission, this is a very important question. I hope that the President will see the significance of it and the need to accept the Amendment.
    Mr. Donald Wade: This is a strange Bill. In a number of Clauses the draftsmen have shown a tenderness towards the parties to restrictive agreements. Furthermore, I fear that many agreements will not be caught by the Bill at all. But every now and then one comes across a Clause which is unexpectedly tough. This Clause has been dubbed "a snooping Clause" and comes into the category of tough.
    Two questions are raised. One is whether the means justify the end, and when the means are illiberal I generally start with the assumption that they do not justify the end. The second question is whether the Clause will achieve the desired end. Whether the Registrar on his own authority should have the power to enter and search the premises of a firm where he thinks a document is to be found raises a point of principle. Permitting the Registrar to act without any application to the Court cannot be justified on any general principles.

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    However, one is forced to the conclusion that the procedure will not work satisfactorily, because if there is a firm which is not co-operating and which has some documents which it does not want to disclose, or an agreement which it wants to keep secret, it will be extremely difficult for any representative of the Registrar, who does not know the premises or where things are kept, to find what he wants. I therefore doubt whether the Clause will achieve the end desired.
    For those reasons, the Amendment would be preferable to the present Clause. However, the difference between the Amendment and that in my name is that the Amendment refers only to documents. In my Amendment I refer to
    "…documents, or any particulars or other information…"

    If the Registrar considers that a certain firm or firms are not disclosing information which they should disclose, or that they are hiding some agreement, the Registrar should have power to call for a statement on oath. A party would be very reluctant to deny on oath that certain information existed. The word "document" by itself is not adequate. We should go a step further and include
    "…documents, or any particulars or other information…"
    If some wording could be evolved which would include that expression, I should be satisfied.
    Sir Lynn Ungoed-Thomas: I feel a good deal of sympathy with the approach of the Amendment. I do not like the idea of being able to go into premises and obtaining information in that way. Here we have the advantage of having court proceedings at some stage. I know that we are now dealing with the position before court proceedings arise, but the distinction between these cases and the proceedings before the Monopolies Commission is that in this case at some stage there will be proceedings, and if there are proceedings the ordinary provisions about revealing documents and discovery, and so on, will apply.
    The problem here is in the proceedings before the High Court proceedings come into operation. We are concerned about two things. The first is that the Registrar,
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    who has to ferret out this information, shall have the means of so doing. It is a grave defect in the Bill that, as we suggested from this side of the Committee yesterday there should be, there is not an automatic penalty for failing to register when the duty of registering is imposed on the parties.
    We are now facing the consequences of that failure to impose a penalty. As there is no penalty for failure to register an agreement, it is extremely important that the Registrar should be in a position to obtain information which he requires about the existence of an agreement. By his attitude towards our Amendment yesterday, the President has put us in a dilemma. How are we to obtain information so as to make registration effective where a party to the agreement chooses not to register, while, at the same time, avoiding procedure which is oppressive to the subject?
    4.45 p.m.
    We are in complete agreement with the approach that the procedure which is adopted should not be oppressive to the subject, that he should not be subjected to some sort of oppression by a Registrar, or some official or other. That is an intolerable situation, and it has resulted from the attitude which the Government have adopted towards our Amendment and from their failure to have any penalty for failure to register.
    One does not want to throw the defects of the Government upon the shoulders of the poor subject and it seems to me that the suggestion put forward by the hon. Member for Huddersfield, West (Mr. Wade) is acceptable. It is not sufficient just to provide that the Registrar can go to the Court and get directions from the Court to do it. The whole Bill is cluttered up with delays by court procedure of one kind or another, court procedure about registration, about whether a contract is within the Bill, or not within the Bill—I shall not go through the whole rigmarole of court procedure which is involved.
    I should have thought that a very sensible and reasonable course would be, if the Registrar thinks that there might be an agreement in existence, to follow the suggestion of the hon. Member for Huddersfield, West. It is reasonably effective and he will be a brazen person

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    who will swear on oath about something and lie about it. It will be perfectly fair and will not be oppressive, because it will be done when the Registrar, who is a responsible official, has a reasonable case for thinking an agreement is in existence, and it will avoid the difficulty, delay and cumbersome procedure of court application.
    Mr. P. Thorneycroft: I hope that the Committee will accept the Amendment. We can all agree that, if there is to be entry upon premises—if that be necessary—then it is right that the proper procedure of applying for a court order first should be undertaken. I think that that is right and that the Committee is united upon it.
    The hon. Member for Huddersfield, West (Mr. Wade) really suggested an alternative procedure. What he really says is that instead of entering upon premises, we would arrive at the same end by getting the Registrar to order people to produce statements upon oath. That is a possible approach. I should like to carry that a stage further. There can, of course, be a procedure similar to that under the Companies Acts.
    Under those Acts, or under a comparable arrangement, where the Registrar believes that registrable agreements exist, but is not satisfied with the information which he had obtained under subsections (1) and (2), he might be able to apply to the court for an order to examine persons believed to be parties to the agreement, and the court could then order the persons concerned to attend and be cross-examined about the matter.
    That would have the advantage over the existing subsection that it would enable the Registrar to obtain information about oral as well as written agreements, and it would also have the advantage over the suggestion made by the hon. Member for Huddersfield, West that it would enable questions to be asked under proper court supervision as to what really was the situation. That would really be an alternative arrangement to this idea of entry, and it might be worth while considering whether that would not be the better way of doing it than an arrangement for entering everybody's premises. I do not think that they will always find very much if they do enter upon anybody's premises.
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    I suggest to the Committee, at this stage that as the Bill stands, we have the provision for entry, and we are all agreed that, if we are to have provision for entry, we must have a court order before it is done. Let us, then, accept the Amendment and get that state of affairs put right in the Bill. Meanwhile, I will consider the arguments put forward by the hon. Member for Huddersfield, West, which would seem to be the kind of thing which I was suggesting here, to see whether we could have an alternative arrangement which would obviate the necessity for people prowling about upon other people's premises. This is the same kind of procedure as under the Companies Acts, and it would enable parties, in such few case where there was real doubt, to be brought before the court and be questioned in order to discover whether the arrangements exist or not.
    Mr. E. Fletcher: May I say that I personally welcome very much what the President has just said? I think it would be intolerable if the Registrar had a right of entry, and I think we are all agreed, on both sides of the Committee, that that would be entirely contrary to our conception of civil liberties and human rights. I am very glad to know that the President is prepared to accept the Amendment.
    As my hon. and learned Friend pointed out, the dilemma in which we find ourselves on Clause 11 really stems from the weakness of Clauses 7 and 8, which were discussed earlier. Since the President has approached all these Amendments in such a conciliatory spirit and has undertaken to review the whole of the procedure, I hope also that in this context he will look with an open mind and with sympathy on the representations made to him yesterday with a view to putting a positive, specific obligation on the parties to the agreement to register. We believe that if that is made clear, specific and obligatory, it will go a long way to remove the possibility of doubt arising under the later Clauses of the Bill. I therefore hope that the President will take the opportunity of saying something about that.
    May I also refer to the suggestion made about court procedure under the Companies Acts being pursued? It seems to me to be really more satisfactory than the proposal made by the hon. Member

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    for Huddersfield, West (Mr. Wade) and I think it would help very much if there were introduced into this Bill some similar provisions and procedure which would enable the Registrar, in cases of doubt, to be able to summon persons and investigate matters in doubt and documents in his possession.
    Sir L. Ungoed-Thomas: We all welcome the attitude adopted by the President of the Board of Trade towards these Amendments, but I want to make quite clear the point about which I was concerned in my earlier observations, when I suggested that the only remedy provided should not be by application to the court. That is the point I wished to make. Therefore, to leave the Amendment which the President is to accept on its own, in substitution for what is now in the Bill, is not good enough.
    I am all in favour of the President accepting that Amendment, but I am cavilling at the right hon. Gentleman saying that it is necessarily an alternative to what has been suggested by the hon. Member for Huddersfield, West (Mr. Wade). The advantage of the hon. Gentleman's Amendment is that it avoids the cumbersome procedure of application to the court, and yet it is not at all oppressive to the subject. It would be a nice change to see in this Bill something that does not involve the procedure of the court.
    I hope that the President will consider the possibility of including something on the lines of the Liberal Party Amendment, as well as the Amendment which he is now considering, because we want something as well as a remedy which involves application to the court. I welcome what he said to my hon. Friend the Member for Islington, East (Mr. E. Fletcher) about the Companies Acts. I hope it will be necessary, as it is certainly advisable, to make the Amendment which the right hon. Gentleman is accepting, because, after all, under that Amendment there will not be any oppression.
    On his own showing, it is a matter which will go before the High Court, which will be discussed with the judge, who will obviously be extremely concerned to see that no oppression is involved and there is no hardship to the subject. There may well be cases in which it is desirable to have the right of entry, under every
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    proper safeguard which the High Court judge provides. I therefore hope that the President will consider these Amendments, not necessarily as alternatives, but as possibly supplementary to each other.
    Amendment agreed to.
    Further Amendment made: In line 25, leave out from "section" to "inspect" in line 28 and insert:
    "the High Court is satisfied by information on oath that there is reasonable ground for suspecting that documents which are material for the purposes of registration under this Part of this Act are to be found at any premises specified in the information, being premises on or from which the said person carries on business, the court may, on application made by any officer duly authorised in that behalf by the Registrar, grant a search warrant authorising any such officer named in the warrant to enter the premises at any time within one month from the date of the warrant, if necessary by force, to search the premises, and to".—[Mr. P. Thorneycroft.]
    Amendment proposed: In page 10, line 30, leave out from "material" to end of Clause and add:
    "as aforesaid
    (4) In the application of this section to Scotland, for any reference to the High Court there shall be substituted a reference to the Court of Session."—[Sir J. Barlow.]
    Amendments to the proposed Amendment made: In line 3, after "Scotland", insert "and Northern Ireland respectively".
    In line 4, at end add:
    "or the High Court of Northern Ireland."—[Mr. P. Thorneycroft.]
    Proposed Amendment, as amended, agreed to.
    Mr. P. Thorneycroft: I beg to move, in page 10, line 31, at the end, to add:
    (4) In the case of any such trade association as is mentioned in paragraph (b) of subsection (1) of this section, a notice under that subsection may be given by the Registrar either to the association or to the secretary, manager or other similar officer of the association; and for the purposes of this section any such association shall be treated as party to any agreement to which members of the association, or persons represented on the association by such members, are parties as such.
    This is a consequential Amendment.
    Mr. E. Fletcher: Is it just consequential?
    Mr. Thorneycroft: Perhaps I should have said that we discussed this Amendment with an earlier Amendment.
    Mr. Fletcher: I know that, but that does not prevent us discussing it further now, does it?
    The Temporary Chairman: As I understand, it was agreed earlier by the Committee to take this and another Amendment together. I shall now put the Question on this Amendment.
    5.0 p.m.
    Mr. E. Fletcher: I do not want in any way to impede progress, Major Anstruther-Gray, but there was one matter which I wanted to discuss and which I do not think it would have been appropriate to raise until we came to this Amendment.
    The Temporary Chairman: I think the hon. Gentleman will find that he has an opportunity quite soon when we discuss the Question, "That the Clause, as amended, stand part of the Bill."
    Amendment agreed to.
    Motion made, and Question proposed, That the Clause, as amended, stand part of the Bill.
    Mr. E. Fletcher: Perhaps it will be convenient now to see where we have got to. Two points ought to be made. Broadly speaking, the first is whether the powers of the Registrar "to obtain information"—I am now reading from the rubric of the Clause—are adequate.
    The second question, with which I want to deal first, is the materiality of the words that have been added about trade associations. Since Clause 11 was printed, we have, largely at my instigation—if I may take credit for it—inserted some words dealing with trade associations. I put down the Amendment in Clause 11, page 10, line 8, to extend the ambit of the Clause to trade associations. The President of the Board of Trade subsequently put down an Amendment of his own to introduce a new paragraph (b), which I must acknowledge is far better from the point of view of draftsmanship than mine was. It carries out the same idea and it has the effect of giving the Registrar power to obtain information from trade associations which he would otherwise not have been able to obtain, So far, so good.
    What about these trade associations? I am not quite happy that even now the President of the Board of Trade or the Registrar has got the full powers that he ought to have and which we want him to have to deal with trade associations.
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    Trade associations are amorphous bodies. They are not like individuals or companies with specific legal obligations. They are, by their nature, much more fluid. As everyone who has had any experience of restrictive practices knows, a great many of the evils that have arisen and that we are now trying to remedy arose from the activities of these associations.
    Would the President of the Board of Trade consider—whatever may be the precise legal nature of these bodies and their legal constitution—whether he has got all the powers that he ought to have to deal with them? By the last Amendment, which we did not discuss, in page 10, line 31, the right hon. Gentleman very wisely has extended the Clause so as to enable him to serve a notice either on the:
    "…secretary, manager or other similar officer of the association…"
    I want him to consider whether such a notice, if served on any of these officers who, for all we know, may after all be mere flunkeys of the association, is really effective to bind the association, the members of it and those who control it. It is all very well to serve a notice on the secretary of an association, but some of these associations are so loose in their constitution that I am not at all sure whether the secretary is a responsible officer in the ordinary sense of the secretary of a limited company. He may be an honorary official, and the real power may reside elsewhere.
    I am nervous about it. I have a feeling that, owing to the way in which the Bill is drafted, there may well be cases in which there are agreements—and as we know, some of these agreements will be verbal agreements and not written ones—between companies carrying on business. A great many of the evils against which we are legislating arise from loose verbal agreements, made by trade associations loosely organised, and imposed very rigidly, but not by any clear-cut legal documents, on their members.
    This is the Clause, if any, which will enable the Registrar to probe into the agreements made by these associations. In its original form, trade associations were entirely outside the scope of the Bill. They have now been brought in, and the question we want to ask—and we merely ask it in this kind of inquisitive

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    way in order to test the effectiveness of the provision—is whether it really goes far enough. As we said in discussing the Amendments, we are anxious to strengthen every Clause in the Bill. We are anxious that the Registrar should obtain all the information that is relevant to enable him to see that all these restrictive agreements are brought to the light of day and published.
    It may well be that the machinery is adequate to ensure that written agreements are not concealed but are registered. I am not entirely happy about that. I should have preferred specific obligations on the parties to a written agreement to register it, and I hope that we shall still get that incorporated in the Bill before we have finished. But what we have found as we have proceeded is that the most sinister of the restrictive agreements which hamper the liberalisation of trade, and which hold up prices, are verbal agreements come to by trade associations which narrowly control their members. I am not at all happy that the Clause, as it stands, is adequate to give the Registrar power to require the information that he will want.
    I have no doubt that when the Bill is enacted, inquiries will be directed to him by Members of Parliament, members of the public, and others as to restrictive practices which are causing injury to the public. He will have to take the initiative in getting the facts. He can give notice to the secretary, the manager and other officers. Is that adequate? What about the people who really direct these associations? What about the members? Why should not the members of an association, if necessary, be called upon to account under this new subsection?
    I do not want to press the matter unduly, but, having ventilated the point which concerns us, I hope that the Government will consider the question between now and Report and see what steps can be taken to strengthen the Clause.
    Mr. Philip Bell: May I tell my right hon. Friend how much I and many of my hon. Friends appreciate his acceptance of the Amendment dealing with the question of entry into premises? I know that the President of the Board of Trade is aware, and I hope that the Parliamentary Secretary remembers, that
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    I felt strongly about this form of entry. I trust that this may form a happy precedent for the future, and that we shall not have brought up what was done for the bakers or for the sanitary inspectors in the past, or any of those old-fashioned methods of entering premises without warrants.
    Mr. G. Darling: I do not want to enter into an argument with the hon. and learned Member for Bolton, East (Mr. Philip Bell). I am worried about whether this Clause is strong enough to achieve what we all want to achieve by the Bill, and that is to obtain the fullest possible information about restrictive practices which ought to be caught by the Bill and dealt with. I cannot read the amended Clause as clearly as it ought to be read, so I do not know whether it is strong enough.
    We want three results from the Bill. First, by the act of registration we hope to see discarded a number of trade agreements that are restrictive. We hope that the parties to them, realising that the agreements will be unlawful according to the definitions in Clause 5, will discard them without any further ado. We also want to see, and I hope we shall see, that agreements where the parties concerned are not sure whether they ought to be continued because they may not be in the public interest will be brought into the open, will be discussed publicly, and a judgment given upon them.
    Then there is the third group of agreements, those that are operated to some extent in secret, often without any formal arrangement of any kind, where one or two traders or industrialists get together and decide to fix common prices, and so on. Such agreements can be judged only by their results, because there is no evidence that they exist, since there may be nothing on paper. Is the Clause as drafted strong enough to get at the evidence, so that the Registrar will know that such agreements are being operated, and ought to be dealt with, or will it be necessary at a later stage of the Bill to tighten the Clause?
    For instance, supposing in a county court it is discovered that a poor trader has been knocked about a bit by a group of industrialists who have either broken contracts with him or have forced him into contracts which, in the opinion of the

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    county court judge, are wrong. The county court judge may say that this is something with which the Restrictive Practices Court ought to deal. How do we make sure that the Restrictive Practices Court will deal with the group of persons who have put that hypothetical trader in this position? Such a case may not arise, but I want to make sure that any activity contrary to the intentions of the Bill will be discovered and dealt with, and I am not sure that the Bill provides for that case.
    I hope that either under this Clause or somewhere else in the Bill—we must leave it to the lawyers to decide where—we shall make sure that all kinds of agreements, written, private or secret, open or made behind closed doors and about which nobody knows except those who suffer from them, can be dealt with in the Restrictive Practices Court and brought to an end.
    5.15 p.m.
    Mr. P. Thorneycroft: The hon. Member for Islington, East (Mr. E. Fletcher) apologised for his drafting. He need make no apology for that because the Government have certain facilities which are not available to every hon. Member in the House, and so it is a little easier for them to draft some of these complicated Amendments.
    Nevertheless the idea behind his Amendment and mine is exactly the same and is shared by all hon. Members. It is that if an association has information of an agreement of this kind, it should be treated in the same way as any other party to an agreement; so this Clause, which is designed to ensure that such information is made available, ought to include within it a provision whereby notice can be served upon an association.
    That is now happily done and I think that the Clause is couched in the right form. The proper person is the secretary, manager or other similar officer of the association. If the members of the association are in a mutual agreement or arrangement of course the Registrar will be entitled to serve notice on any one of the members. The difficulty is that they might not be in such an arrangement, and the provision about the association is designed to deal with the case where there is no real evidence of a direct mutual arrangement, but where it was made on the basis of a recommendation
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    by the association, or the other case in which the association itself had entered into the mutual restriction. So the Clause catches those cases which all hon. Members think we should properly catch.
    I endorse the remarks of my hon. and learned Friend the Member for Bolton, East (Mr. Philip Bell). I think that the Amendment ensuring that, if powers are used, they are subject to the Court is a right and proper provision to put into the Bill. I am grateful to my hon. Friends for putting it forward.
    In reply to the hon. Member for Hillsborough (Mr. G. Darling) I would say that nobody would suggest that we shall catch every arrangement in the world. We cannot do it. Even when the Committee has completed all the anxious work that it is doing on this Bill, I expect we shall find that there will be some loopholes somewhere and that something will get through. However, we want to ensure that the loopholes are as small as possible and that there are as few opportunities for evasion as possible. If the hon. Gentleman looks at the wording of Clause 5 he will see that we have spread the net fairly wide, and in Clause 8 (3, b) he will see how we deal with the oral as well as with the written arrangement.
    I believe that this Clause, as amended with the assistance of the Committee, is a useful and workmanlike approach, and I hope that the Committee will approve it.
    Question put and agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    Clause 12.—(OFFENCES IN CONNECTION WITH REGISTRATION.)
    Motion made, and Question proposed, That the Clause stand part of the Bill.
    Mr. A. J. Irvine: There appears to be a defect in the Clause, and also an omission in that no provision is made for a penalty for the offence committed—and I think it should be regarded as an offence—where a person who is a party to a registrable agreement fails to draw the attention of the Registrar to its existence and to provide the particulars which he is required to furnish under Clause 8.
    Nobody desires to add unnecessarily or without careful thought to the number of offences which people may commit and

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    which may involve them in a fine, but it is very important that penalties should be fairly imposed. If one type of offence is visited by a severe penalty, similar or equivalent offences should not be allowed to be committed and the persons concerned go free.
    If a party to an agreement receives a notice from the Registrar requiring him to furnish certain particulars, and he suppresses a document which he is asked to disclose, he renders himself liable to a heavy fine. Is it reasonable or equitable that a party to a registrable agreement who fails at the outset to furnish any particulars of it at all should not be subjected to any penalty whatever? That is a material and substantial point, affecting the whole of the proposed machinery of the Bill.
    As the Bill stands, the obligation is imposed upon the Registrar to find out, or "smell out", restrictive agreements that should be registered. There is an indefinite requirement in the Bill that particulars shall be furnished, but no clear statement whose duty it is to furnish them. The burden appears to be imposed upon the Registrar to make the inquiries and make the discoveries. I ask the Government to consider the desirability of making it an offence for any party to a registrable agreement to fail to furnish the particulars required in Clause 8.
    In case anybody should say that it would be oppressive to make such a provision, I would point out that the fact that a party has a reasonable excuse for failure is a defence under the Clause, and that that would apply in the case to which I have drawn the attention of the Committee. Where there is no reasonable excuse, and where the person who is party to a registrable agreement fails to draw the agreement to the attention of the Registrar, or fails to ensure that other parties to the agreement do so, some sanction should be available, because such conduct should be treated as an offence.
    Mr. Mulley: The Parliamentary Secretary will recall that when he dealt with a point ably put by my hon. Friend the Member for Blackburn (Mrs. Castle) on Clause 8, he was asked to consider whether there should not be punishment for failure to register and whether that
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    might not more properly come into this Clause rather than into Clause 8. The side-note to the Clause is misleading. It says:
    "Offences in connection with registration."
    It is clear that no penalty is suffered for deliberately failing to register an agreement. Let us go through the sequence in order to make sure that we have the matter clearly in mind.
    If a person ignores the Act completely and refuses to register an agreement, he gets away with it completely, unless the Registrar finds out about it. If the Registrar finds out, all that happens is that he serves a notice on the person to furnish particulars. If the person ignores that notice, as he may well do, all that happens is that the Registrar goes to the Court and gets an order that the person must furnish the particulars within fourteen days. At long last, possibly four years afterwards, he can still register, so long as he does so within the fourteen-day period. Nothing whatever will happen to him, except perhaps that he pays the Registrar's costs. That is the maximum penalty.
    Surely that is not good enough. We do not expect that the great majority of people will seek to avoid the provisions of the Act. In many industries the agreements are too well known for them to be concealed for very long. It is grossly unfair on those who register agreements properly that those who do not do so suffer no penalty whatever.
    The maximum penalty for making statements known to be false during the act of registration is only £100 or imprisonment for a period up to three months. That penalty seems very mild contrasted with the penalty for similar offences in other fields, and it ought to be reviewed. People tend to measure the seriousness of an offence by the extent of the punishment of those who default.
    Another point of detail which the Parliamentary Secretary might care to explain to me arises in subsection (3) under which, if a default in respect of an offence under subsection (1) continues after conviction, the person shall be liable to a fine not exceeding £100, or not exceeding £10 for every day on which the default continues
    "within the three months next following his conviction for the first-mentioned offence."

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    Why the limitation of three months? It is most unusual. Does it mean that the maximum penalty for a gross breach of the Act and contempt of the Court would be only £10 per day for a maximum of three months? I may have misunderstood the Clause, and it is important to raise this point on a Clause dealing with offences in connection with registration.
    It seems that the penalties for failure to register an agreement or for deliberately obstructing the Registrar by failing to comply with orders to furnish particulars, are on the low side. May we have the Parliamentary Secretary's assurance that the Clause will be very carefully considered between now and the Report stage? It is difficult to try to rewrite the whole Clause, as would be necessary to meet the points which I have tried to put to the Committee.
    5.30 p.m.
    Mr. Wade: When the Parliamentary Secretary replies, it would be helpful if he would give an indication or assurance that the necessary Amendments will be introduced on Report. As the Clause reads at present, there is a penalty provided for those who fail to comply with the notice; but it is surely necessary that words should be introduced to ensure that those who fail to furnish particulars of an agreement
    "subject to registration under this Part of this Act"
    when so liable, suffer a penalty if they fail to do what is required of them. As the Parliamentary Secretary or the Minister has already said, the Government have facilities for the wording of Clauses which are not available to humble back-bench Members, but an assurance is necessary that Amendments will be introduced to tidy up the Clause.
    Similarly, it would appear that reference must be made to trade associations, since, as a result of Amendments which have been made to earlier Clauses, they are now under an obligation to provide particulars for registration. In saying this, I am making no general attack upon trade associations; they perform a valuable service. We are not discussing the value of the services which they render.
    I desire to make the Clause reasonable and to fit the other provisions of the Bill.
    434
    I hope, therefore, that in replying the Parliamentary Secretary will deal with the points which have been raised on the Clause, and will give an assurance as to the probability of Amendments being brought forward on Report.
    Mr. Turner-Samuels: Will the Parliamentary Secretary, when he replies, consider the question about failure to register and whether, within the provisions of the Bill, there is any method whereby a penalty can be imposed? While there is no direct reference to a penalty in the event of failure to register, nevertheless I am not certain that consequences to a person who defaults in registration might not follow from the provisions of Clause 8, under which the Court is given power to order an individual defaulter to register particulars—in other words, to register a document or something which amounts to an agreement which would be subject to registration.
    If there is an express order of the Court and there is default, would that not amount to contempt of court? In those circumstances, is it not incorrect to say that there is no possibility of a penalty? It seems to me that the matter might be left in such a way that in such a situation the Court would be able to consider the whole of the circumstances and, if it was a very bad case, could treat the defaulter accordingly; and, for example, send him to prison for not complying with the order of the Court—in other words, for not registering an agreement or such documents as existed which might be said to constitute an agreement. In these circumstances, is it not correct that there is some sanction, although there is no direct reference to it, by which in practice a defaulter could come within the grip of the law and, if necessary, be sent to prison?
    Mr. Walker-Smith: To deal first with the point raised by the hon. and learned Member for Gloucester (Mr. Turner-Samuels), it is quite true that if an order is made under Clause 8 (5) and if the party on whom it is made disobeys it, he is in contempt of court and can be dealt with in that way. It is, therefore, true that there is a penalty in that sense but it is, of course, a penalty at one remove.
    The Committee is concerned—the hon. Members for Edge Hill (Mr. A. J. Irvine) and Huddersfield, West (Mr. Wade) were

    435
    concerned with this point—that there is in the Bill as now drafted no penalty or sanction in respect of a person who, not by inadvertence but deliberately, fails to register. The penalties as such under Clause 12 only start to bite when there has been an initiative by the Registrar—that is to say, when he has served a notice and there has been failure to comply with it under subsection (1)—or, if a person has been required to furnish particulars, a false or misleading statement is made, under subsection (2).
    It is, of course, right that that should be dealt with by the penalty Clause, but we are faced with the possible gap in the Bill that there is no penalty directly for a deliberate failure to register. There is procedure for dealing with that under Clause 8 (5), and it is possible that the party who is dealt with under paragraph (b) of that subsection may find himself in a sense worse off, because the Registrar can then be empowered to furnish particulars, which may be less than the full particulars and may possibly be prejudicial to the party who has failed to register the agreement.
    In many cases, however, it may well be true, in the Bill as at present drafted, that the person deliberately concealing or failing to register might ultimately be the gainer, in that although his case would probably be dealt with in due course, he would have a delay which might benefit him as against the more honest person who registered his agreement and who, I am satisfied, would be in a vast majority. That being so, the question for the Committee to consider is, what is the appropriate way of applying some sanction?
    As the hon. Member for Sheffield, Park (Mr. Mulley) observed, that takes us back to our discussions on Clause 8 yesterday. It is probably right to say that the sanctions suggested by my right hon. Friend, and a fortiori the sterner sanctions suggested by the hon. and learned Member for Gloucester, would probably be more effective in that direction than a strict penal sanction under Clause 12.
    As the Committee will recall, my right hon. Friend said yesterday:
    "I think that he "—
    that is a person who has deliberately failed to register—
    436
    "should have a penalty of some kind inflicted upon him in those circumstances."—[OFFICIAL REPORT, 1st May, 1956; Vol. 552, c. 316.]
    He then indicated to the Committee the kind of provision which, while not going so far as the hon. and learned Member suggested—we do not want to discuss that again—was on the same basis of approach. That is to say, the sanction would be that, for a period at least, the agreement would become proscribed without the necessity of being tried by the Restrictive Practices Court.
    As my right hon. Friend told the Committee, we are considering that aspect between now and the Report stage and this point falls to be dealt with in the same consideration. I assure hon. Members who have been good enough to contribute their views this afternoon that we shall, of course, take into account all that they have said.
    There are one or two small specific points with which I should deal. The hon. Member for Sheffield, Park, in referring to the smallness of the penalties, referred only, I think, to the penalties on summary conviction in subsection (2). There are larger penalties appropriate for indictment. With regard to the question about the three months, at the expiration of that period the continuing offence would, I understand, come to an end, but of course a fresh offence under subsection (1) would be created immediately thereafter. It is, I think, not considered desirable to continue an offence under the first conviction without limitation in any way.
    Sir L. Ungoed-Thomas: As the Parliamentary Secretary will have realised from the strong observations made about the Clause, we are very dissatisfied with it. We considered putting down Amendments to it, and our difficulty was largely one of drafting. The whole conception of the Clause is based upon the preliminary requirement that
    "if any person fails without reasonable excuse to comply with a notice duly given to him under the last foregoing section"
    —and only then—the Clause shall come into operation. The difficulty is that "under the foregoing section" the Registrar must in the first place, before he can have authority to issue a notice, have reasonable cause to believe that there is an agreement within the Act.
    The Clause is headed "Offences in connection with registration", but it is limited

    437
    to cases in which the Registrar has reason to believe that there is an agreement. Only then does the Clause come into operation. We believe it to be a wholly inadequate Clause, not merely for the reasons brought out so clearly by my hon. Friends the Members for Sheffield, Park (Mr. Mulley), Islington, East (Mr. E. Fletcher) and Edge Hill (Mr. A. J. Irvine), but also because the notice can be given only if the Registrar has reason to believe that an agreement is in existence.
    The Parliamentary Secretary referred to Clause 8 (5) and the Amendment the introduction of which the President has in mind. That does not meet our fundamental objection at all. Our fundamental objection is that no penalty whatever arises from the failure to register. Before any penalty, including the introduction of the Amendment to Clause 8 (5) which the President has in mind, is operative, the Registrar must have some cause to believe that there is an agreement in existence, and must serve a notice requiring the particulars to be furnished. That is a fundamental defect of the Bill.
    The Parliamentary Secretary says that he expects large numbers of people to register. I should like to think exactly the same, and I will not gainsay him; I believe that large numbers of responsible people will register. The difficulty about the offences system of the Bill, including the Clause, is that we penalise the more honest members of the community and leave a vast loophole for the less honest. Surely that is bad legislation. The Government are relying, by wishful thinking, on the hope that people will register under the Bill. They are relying, as a matter of wishful thinking and hopefulness, on the decency of the vast majority of people to come forward and register, but they are automatically penalising such people in contrast with those who lie low and do not register.
    That, of course, is thoroughly pernicious and it is not a method to which we can subscribe. The President's difficulty is that he has a phobia about attaching any kind of penalty because it might be considered as a criminal penalty, and he does not want the Bill to be tinged with a criminal aspect. I am not arguing against him on that issue. We have not suggested that mere failure to register should automatically involve a criminal
    438
    offence, but what we suggested yesterday—and, had it been accepted, it would have reduced our objections to the Clause a good deal—was that where there is failure to register, the agreement should be treated as an agreement which is contrary to the public interest.
    5.45 p.m.
    We cannot accept the scheme of sanctions included in the Bill. This Clause is the Government's answer to the question, what sanctions are to be applied? But the fundamental difficulty in the whole of their scheme of sanctions in the Clause is that it is limited to cases in which the Registrar has already found out that there is an agreement in existence. That is a gross defect in the Bill, and although we are in favour of the sanctions in the Clause, such as they are, we shall, as the Clause represents the whole scheme of sanctions to the Bill, register our opposition to it and trust that the Government will bring forward recommendations which will cover the lacuna which now exists and which is not covered by the Amendment which the President said yesterday that he has in mind.
    Sir Lancelot Joynson-Hicks: The hon. and learned Member for Leicester, North-East (Sir L. UngoedThomas) has set out the case made by his hon. Friends, but there is another small though not unimportant point. I agree with the Parliamentary Secretary in saying that the proportion of cases which it might be expected will not be registered voluntarily is exceedingly small, but if it appears to the naughty people that there is a chance of getting away with it, and if it is beneficial to them to do so, they may try to get away with it. They may be a very small minority, but they are the people we want to catch.
    As I see it, the majority of such a minority of cases are likely to argue as their defence that they did not believe there was any agreement. It will be exceedingly difficult for that issue to be decided by the Registrar. I therefore feel that my hon. and learned Friend's suggestion—that in such cases, where there has been wilful default in registration, the Registrar may have a discretionary power to prescribe the agreement altogether—requires exceedingly careful

    439
    thought, because it might well put the Registrar into a difficult position. It might cause his position to be regarded as other than that which we have been trying to create for him in the Bill vis-à-vis the parties to the great mass of agreements.
    I therefore suggest to my hon. and learned Friend that when he is considering this matter, he might also consider it upon the lines that the Registrar shall have power to refer the question to the Court, so that the Court may decide whether there has been wilful default, without reasonable excuse, in withholding registration of the agreement. I beg him to be careful in putting upon the Registrar the onus and burden of becoming the executioner to the parties to an agreement.
    Sir L. Ungoed-Thomas: Would the hon. Member not agree, in view of his opening remarks about letting out the less scrupulous from the provisions of the Bill and penalising those who register in accordance with its requirements, that it is important that there should be automatic provision and not provision dependent on the Registrar finding out in the first place that an agreement may exist?
    Sir L. Joynson-Hicks: No, I would not agree with that. There are many possibilities of a bona fide mistake being made and a perfectly good reason existing for a registration not having taken place. It would be most unfortunate to have an automatic penalty.
    Mr. Walker-Smith: It is the firm intention of the Government that the gap in the Bill should be closed and that provision should be made to prevent a deliberate defaulter getting the benefit of his default. Our present thinking is on the lines explained by my right hon. Friend in the debate yesterday, but in our thinking we shall take all relevant circumstances into account and, in particular, what has been said in the debate this evening. I can assure my hon. Friend the Member for Chichester (Sir L. Joynson-Hicks) that we shall have regard to what he has said.
    I would add this in regard to what was said by the hon. and learned Member for Leicester, North-East (Sir L. Ungoed-Thomas). He made great play, with his customary emphasis of manner
    440
    and vigour of tone, with the fact that this sanction would not bite until the Registrar knew that there had been a deliberate default. Precisely the same, of course, would apply to what the hon. and learned Member calls an automatic penalty. I appreciate that the practice of the hon. and learned Member lies in more rarefied spheres, but where there are criminal offences, before they can be punished it is necessary for them in any event to be detected. I hope we may now have the Clause.
    Sir L. Ungoed-Thomas: I am really astonished at the lack of understanding of the Parliamentary Secretary. We did not propose a criminal penalty and, therefore, we are not delving into criminal offences. What we proposed was that the agreement should be treated as an agreement which the Court had pronounced to be contrary to the public interest. It would, therefore, have necessarily the same consequences as the President proposed for agreements which are declared by the Court to be contrary to the public interest. As has been emphasised time and again, that does not involve a criminal offence.
    Mr. Walker-Smith: The Committee has passed judgment on the proposed Amendment of the hon. and learned Member to Clause 8. We are now dealing with Clause 12 which, as the marginal note shows, deals with offences—that is to say, criminal offences—in connection with registration.
    Sir L. Ungoed-Thomas: We really cannot let it go like this. The argument I was putting forward was not that we are proposing that an automatic sanction for failure to register an agreement should be a criminal sanction. What we said was that if our proposals on that question were accepted we would not have such a stiff objection to Clause 12 as we now have. It is because of that, that we are particularly concerned about the objections to Clause 12, which provides for no remedy.
    I agree that there are criminal penalties in the Clause, but the point I was making about our Amendment was that we provided, not a criminal penalty, but a civil penalty, and that would go a great way towards meeting the defects of the Clause. We have not suggested, and do not suggest now, that we should make failure

    441
    to register subject to a criminal penalty. We say it should be a civil penalty and should operate as with an agreement condemned by the Restrictive Practices Court.
    Mr. Walker-Smith: I do not know what the hon. and learned Member means by "we." There is an Amendment in the names of five of his hon. Friends which would make it a criminal offence.
    Sir L. Ungoed-Thomas: Which one is that?
    Mr. Mulley: I do not want to delay the proceedings of the Committee, but it does not seem to me that the suggestion made by the Government—I am not going to argue whether it should be a civil or criminal penalty—would be enough. It seems to me that the kind of person who would not register an agreement is someone with a shrewd idea that that agreement would not be found to be in the public interest and who feels that if he took it to the Court the decision would go against him. If that is the case and the suggestion is that automatically that agreement is held to be contrary to the public interest, such a person would have nothing to lose. The Amendment suggested by the Government, therefore, would not be a deterrent at all because the class of person who would avoid registration is the kind of person who is fairly certain that the agreement would fail if he went to the Court. I do not
    think that what the Government suggest is enough to provide a practical deterrent, and I hope that the Parliamentary Secretary will think rather more generously on these lines.
    Mr. Walker-Smith: I appreciate the point made by the hon. Member for Sheffield, Park (Mr. Mulley), but the same objection applies to the Amendment moved by his hon. and learned Friend the Member for Leicester, North-East to Clause 8. We shall, however, include it in the matters to which we are giving consideration before Report stage.
    Sir James Hutchison: Before we part with the Clause, I hope that my hon. Friend the Parliamentary Secretary will think carefully about the suggestion which I understand was made by the hon. and learned Member for Leicester, North-East (Sir L. Ungoed-Thomas) that if an agreement is not registered it shall automatically be considered as one that is condemned. It is conceivable that an agreement might act in the public interest. I think that possibility has to be provided for. Even though the defaulter should not have registered in the ultimate discussion and consideration it might turn out that the agreement is in the public interest.
    Question put, That the Clause stand part of the Bill:—
    The Committee divided: Ayes 248, Noes 198.

    Division No. 162.]

    AYES

    [5.57 p.m.

    Agnew, Cmdr, P. G.

    Brooke, Rt. Hon. Henry

    Duthie, W. S.

    Aitken, W. T.

    Bryan, P.

    Eden, J. B. (Bournemouth, West)

    Allan, R. A. (Paddington, S.)

    Buchan-Hepburn, Rt. Hon. P. C. T.

    Elliot, Rt. Hon. W. E.

    Amery, Julian (Preston, N.)

    Bullus, Wing Commander E. E.

    Emmet, Hon. Mrs. Evelyn

    Arbuthnot, John

    Burden, F. F. A.

    Errington, Sir Eric

    Armstrong, C. W.

    Butcher, Sir Herbert

    Farey-Jones, F. W.

    Ashton, H.

    Butler, Rt. Hn. R. A. (Saffron Walden)

    Finlay, Graeme

    Baldock, Lt.-Cmdr. J. M.

    Campbell, Sir David

    Fisher, Nigel

    Baldwin, A. E.

    Carr, Robert

    Fleetwood-Hesketh, R. P.

    Balniel, Lord

    Cary, Sir Robert

    Fletcher-Cooke, C.

    Barlow, Sir John

    Chichester-Clark, R.

    Fort, R.

    Barter, John

    Clarke, Brig. Terence (Portsmth, W.)

    Foster, John

    Baxter, Sir Beverley

    Cole, Norman

    Fraser, Hon. Hugh (Stone)

    Beamish, Maj. Tufton

    Cooper, Sqn. Ldr. Albert

    Galbraith, Hon. T. C. D.

    Bell, Philip (Bolton, E.)

    Cordeaux, Lt.-Col. J. K.

    George, J. C. (Pollok)

    Bell, Ronald (Bucks, S.)

    Corfield, Capt. F. V.

    Gibson-Watt, D.

    Bennett, F. M. (Torquay)

    Craddock, Beresford (Spelthorne)

    Glover, D.

    Bennett, Dr. Reginald

    Crosthwaite-Eyre, Col. O. E.

    Godber, J. B.

    Bevins, J. R. (Toxteth)

    Crowder, Sir John (Finchley)

    Gomme-Duncan, Col. Sir Alan

    Bidgood, J. C.

    Crowder, Petre (Ruislip—Northwood)

    Gower, H. R.

    Biggs-Davison, J. A.

    Cunningham, Knox

    Grant, W. (Woodside)

    Bishop, F. P.

    Currie, C. B. H.

    Green, A.

    Body, R. F.

    D'Avigdor-Goldsmid, Sir Henry

    Gresham Cooke, R.

    Bossom, Sir A. C.

    Deedes, W. F.

    Grimond, J.

    Bowen, E. R. (Cardigan)

    Donaldson, Cmdr. C. E. McA.

    Grimston, Hon. John (St. Albans)

    Boyle, Sir Edward

    Doughty, C. J. A.

    Grimston, Sir Robert (Westbury)

    Braine, B. R.

    Drayson, G. B.

    Grosvenor, Lt.-Col. R. G.

    Braithwaite, Sir Albert (Harrow, W.)

    du Cann, E. D. L.

    Gurden, Harold

    Bromley-Davenport, Lt.-Col. W. H.

    Duncan, Capt. J. A. L.

    Hall, John (Wycombe)

    Hare, Rt. Hon. J. H.

    Lucas, P. B. (Brentford & Chiswick)

    Roberts, Sir Peter (Heeley)

    Harris, Frederic (Croydon, N.W.)

    Lucas-Tooth, Sir Hugh

    Robertson, Sir David

    Harris, Reader (Heston)

    McAdden, S. J.

    Robinson, Sir Roland (Blackpool, S.)

    Harrison, A. B. C. (Maldon)

    Macdonald, Sir Peter

    Robson-Brown, W.

    Harrison, Col, J. H. (Eye)

    McKibbin, A. J.

    Roper, Sir Harold

    Harvey, Air Cdre. A. V. (Macclesfd)

    Mackie, J. H. (Galloway)

    Ropner, Col. Sir Leonard

    Harvey, Ian (Harrow, E.)

    McLaughlin, Mrs. P.

    Russell, R. S.

    Harvey, John (Walthamstow, E.)

    Maclay, Rt. Hon. John

    Schofield, Lt.-Col. W.

    Hay, John

    Macleod, Rt. Hn. Iain (Enfield, W.)

    Scott-Miller, Cmdr. R.

    Head, Rt. Hon. A. H.

    MacLeod, John (Ross & Cromarty)

    Sharpies, R. C.

    Heald, Rt. Hon. Sir Lionel

    Macmillan, Rt. Hn. Harold(Bromley)

    Shepherd, William

    Heath, Rt. Hon. E. R. G.

    Macpherson, Niall (Dumfries)

    Simon, J. E. S. (Middlesbrough, W.)

    Henderson, John (Cathcart)

    Maddan, Martin

    Smithers, Peter (Winchester)

    Hinchingbrooke, Viscount

    Maitland, Cdr. J. F. W. (Horncastle)

    Smyth, Brig. Sir John (Norwood)

    Holland-Martin, C. J.

    Manningham-Buller, Rt. Hn. Sir R.

    Spearman, A. C. M.

    Holt, A. F.

    Markham, Major Sir Frank

    Speir, R. M.

    Hope, Lord John

    Marlowe, A. A. H.

    Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)

    Hornsby-Smith, Miss M. P.

    Marples, A. E.

    Stevens, Geoffrey

    Horobin, Sir Ian

    Marshall, Douglas

    Steward, Harold (Stockport, S.)

    Hudson, Sir Austin (Lewisham, N.)

    Mathew, R.

    Stewart, Henderson (Fife, E.)

    Hudson, W. R. A. (Hull, N.)

    Maude, Angus

    Stoddart-Soott, Col. M.

    Hughes Hallett, Vice-Admiral J.

    Maudling, Rt. Hon. R.

    Studholme, H. G.

    Hughes-Young, M. H. C.

    Mawby, R. L.

    Summers, G. S. (Aylesbury)

    Hurd, A. R.

    Maydon, Lt.-Comdr. S. L. C.

    Taylor, William (Bradford, N.)

    Hutchison, Sir Ian Clark(E'b'gh, W.)

    Milligan, Rt. Hon. W. R.

    Teeling, W.

    Hutchison, Sir James (Scotstoun)

    Moore, Sir Thomas

    Thompson, Lt.-Cdr. R. (Croydon, S.)

    Hyde, Montgomery

    Mott-Radclyffe, C. E.

    Thorneycroft, Rt. Hon. P.

    Iremonger, T. L.

    Nairn, D. L. S.

    Thornton-Kemsley, C. N.

    Irvine, Bryant Godman (Rye)

    Nicholson, Godfrey (Farnham)

    Tiley, A. (Bradford, W.)

    Jenkins, Robert (Dulwich)

    Nicolson, N. (B'n'm'th, E. & Chr'ch)

    Tilney, John (Wavertree)

    Jennings, Sir Roland (Hallam)

    Nield, Basil (Chester)

    Touche, Sir Gordon

    Johnson, Dr. Donald (Carlisle)

    Oakshott, H. D.

    Turner, H. F. L.

    Johnson, Eric (Blackley)

    O'Neill, Hn. Phelim (Co. Antrim, N.)

    Turton, Rt. Hon. R. H.

    Jones, Rt. Hon. Aubrey (Hall Green)

    Ormsby-Gore, Hon. W. D.

    Tweedsmuir, Lady

    Joseph, Sir Keith

    Orr, Capt. L. P. S.

    Vane, W. M. F.

    Joynson-Hicks, Hon. Sir Lancelot

    Orr-Ewing, Charles Ian (Hendon, N.)

    Vaughan-Morgan, J. K.

    Keegan, D.

    Osborne, C.

    Vickers, Miss J. H.

    Kerby, Capt. H. B.

    Page, R. G.

    Wade, D. W.

    Kerr, H. W.

    Pannell, N. A. (Kirkdale)

    Wakefield, Sir Wavell (St. M'lebone)

    Kershaw, J, A.

    Partridge, E.

    Walker-Smith, D. C.

    Kimball, M.

    Pickthorn, K. W. M.

    Wall, Major Patrick

    Kirk, P. M.

    Pilkington, Capt. R. A.

    Ward, Hon. George (Worcester)

    Lagden, G. W.

    Pitt, Miss E. M.

    Ward, Dame Irene (Tynemouth)

    Lancaster, Col. C. G.

    Pott, H. P.

    Waterhouse, Capt. Rt. Hon. C.

    Langford-Holt, J. A.

    Powell, J. Enoch

    Watkinson, Rt. Hon. Harold

    Leather, E. H. C.

    Profumo, J. D.

    Webbe, Sir H.

    Leavey, J. A.

    Raikes, Sir Victor

    Whitelaw, W. S. I. (Penrith & Border)

    Leburn, W. G.

    Ramsden, J. E.

    Williams, Paul (Sunderland, S.)

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

    Rawlinson, Peter

    Wilson, Geoffrey (Truro)

    Legh, Hon. Peter (Petersfield)

    Redmayne, M.

    Woollam, John Victor

    Lindsay, Hon. James (Devon, N.)

    Rees-Davies, W. R.

    Yates, William (The Wrekin)

    Lloyd, Maj. Sir Guy (Renfrew, E.)

    Remnant, Hon. P.

    Lloyd-George, Maj. Rt. Hon. C.

    Renton, D. L. M.

    TELLERS FOR THE AYES:

    Longden, Gilbert

    Ridsdale, J. E.

    Mr. Wills and Mr. Wakefield

    Lucas, Sir Jocelyn (Portsmouth, S.)

    Rippon, A. G. F.

    NOES

    Ainsley, J. W.

    Butler, Mrs. Joyce (Wood Green)

    Ede, Rt. Hon. J. C.

    Albu, A. H.

    Callaghan, L. J.

    Edwards, Rt. Hon. John (Brighouse)

    Allaun, Frank (Salford, E.)

    Castle, Mrs. B. A.

    Edwards, Rt. Hon. Ness (Caerphilly)

    Allen, Arthur (Bosworth)

    Champion, A. J.

    Edwards, Robert (Bilston)

    Allen, Scholefield (Crewe)

    Chapman, W. D.

    Evans, Albert (Islington, S.W.)

    Awbery, S. S.

    Chetwynd, G. R.

    Evans, Stanley (Wednesbury)

    Bacon, Miss Alice

    Clunie, J.

    Fernyhough, E.

    Balfour, A.

    Coldrick, W.

    Fienburgh, W.

    Bence, C. B. (Dunbartonshire, E.)

    Collick, P. H. (Birkenhead)

    Fletcher, Eric

    Benn, Hn. Wedgwood (Bristol, S.E.)

    Collins, V.J. (Shoreditch & Finsbury)

    Forman, J. C.

    Benson, G.

    Corbet, Mrs. Freda

    Fraser, Thomas (Hamilton)

    Beswick, F.

    Cove, W. G.

    Gaitskell, Rt. Hon. H. T. N.

    Blackburn, F.

    Craddock, George (Bradford, S.)

    Gibson, C. W.

    Blenkinsop, A.

    Cronin, J. D.

    Gooch, E. G.

    Blyton, W. R.

    Crossman, R. H. S.

    Gordon Walker, Rt. Hon. P. C.

    Boardman, H.

    Cullen, Mrs. A.

    Greenwood, Anthony

    Bottomley, Rt. Hon. A. G.

    Daines, P.

    Grenfell, Rt. Hon. D. R.

    Bowden, H. W. (Leicester, S.W.)

    Dalton, Rt. Hon. H.

    Grey, C. F.

    Bowles, F. G.

    Darling, George (Hillsborough)

    Griffiths, Rt. Hon. James (Llanelly)

    Boyd, T. C.

    Davies Ernest (Enfield, E.)

    Griffiths, William (Exchange)

    Brockway, A. F.

    Davies, Harold (Leek)

    Hale, Leslie

    Broughton, Dr. A. D. D.

    Davies, Stephen (Merthyr)

    Hall, Rt. Hn. Glenvil (Colne Valley)

    Brown, Rt. Hon. George (Belper)

    de Freitas, Geoffrey

    Hamilton, W. W.

    Brown, Thomas (Ince)

    Delargy, H. J.

    Hannan, W.

    Burton, Miss F. E.

    Dodds, N. N.

    Hastings, S.

    Butler, Herbert (Hackney, C.)

    Dugdale, Rt. Hn. John (W. Brmwch)

    Hayman, F. H.

    444

    445

    Henderson, Rt. Hn. A. (Rwly Regis)

    Messer, Sir F.

    Sheffington, A. M.

    Herbison, Miss M.

    Mitchison, G. R.

    Slater, Mrs. H. (Stoke, N.)

    Hobson, C. R.

    Monslow, W.

    Slater, J. (Sedgefield)

    Holmes, Horace

    Moody, A. S.

    Smith, Ellis (Stoke, S.)

    Houghton, Douglas

    Morris, Percy (Swansea, W.)

    Sorensen, R. W.

    Howell, Denis (All Saints)

    Morrison, Rt. Hn. Herbert (Lewis'm, S.)

    Steele, T.

    Hubbard, T. F.

    Mort, D. L.

    Stewart, Michael (Fulham)

    Hughes, Cledwyn (Anglesey)

    Moss, R.

    Stokes, Rt. Hon. R. R. (Ipswich)

    Hughes, Hector (Aberdeen, N.)

    Moyle, A.

    Stones, W. (Consett)

    Hunter, A. E.

    Mulley, F. W.

    Strauss, Rt. Hon. George (Vauxhall)

    Irvine, A. J. (Edge Hill)

    Neal, Harold (Bolsover)

    Stross, Dr. Barnett (Stoke-on-Trent, C.)

    Irving, S. (Dartford)

    Noel-Baker, Francis (Swindon)

    Summerskill, Rt. Hon. E.

    Jay, Rt. Hon. D. P. T.

    Oliver, G. H.

    Sylvester, G. O.

    Jeger, George (Goole)

    Oram, A. E.

    Taylor, Bernard (Mansfield)

    Jenkins, Roy (Stechford)

    Orbach, M.

    Taylor, John (West Lothian)

    Johnson, James (Rugby)

    Oswald, T.

    Thomson, George (Dundee, E.)

    Jones, Rt. Hon. A. Creech(Wakefield)

    Owen, W. J.

    Timmons, J.

    Jones, David (The Hartlepools)

    Jones, Jack (Rotherham)

    Paling, Rt. Hon. W. (Dearne Valley)

    Tomney, F.

    Jones, J. Idwal (Wrexham)

    Paling, Will T. (Dewsbury)

    Turner-Samuels, M.

    Jones, T. W. (Merioneth)

    Pargiter, G. A.

    Ungoed-Thomas, Sir Lynn

    Kenyon, C.

    Parkin, B. T.

    Warbey, W. N.

    Key, Rt. Hon. C. W.

    Paton, J.

    Weitzman, D.

    Lawson, G. M.

    Pearson, A.

    Wells, Percy (Faversham)

    Ledger, ft. J.

    Plummer, Sir Leslie

    West, D. G.

    Lee, Frederick (Newton)

    Price, J. T. (Westhoughton)

    Wheeldon, W. E.

    Lee, Miss Jennie (Cannock)

    Price, Philips (Gloucestershire, W.)

    White, Henry (Derbyshire, N.E.)

    Lever, Leslie (Ardwick)

    Probert, A. R.

    Wilkins, W. A.

    Lewis, Arthur

    Proctor, W. T.

    Willey, Frederick

    Logan, D. G.

    Pryde, D. J.

    Williams, Rev. Llywelyn (Ab'tillery)

    Mabon, Dr. J. Dickson

    Randall, H. E.

    Williams, W. R. (Openshaw)

    McGhee, H. G.

    Redhead, E. C.

    Willis, Eustace (Edinburgh, E.)

    McGovern, J.

    Reeves, J.

    Wilson, Rt. Hon. Harold (Huyton)

    McInnes, J.

    Reid, William

    Winterbottom, Richard

    McKay, John (Wallsend)

    Robens, Rt. Hon. A.

    Woodburn, Rt. Hon. A.

    McLeavy, Frank

    Roberts, Albert (Normanton)

    Woof, R. E.

    MacPherson, Malcolm (Stirling)

    Roberts, Goronwy (Caernarvon)

    Yates, V. (Ladywood)

    Mahon, Simon

    Robinson, Kenneth (St. Pancras, N.)

    Zilliacus, K.

    Mallalieu, E. L. (Brigg)

    Rogers, George (Kensington, N.)

    Mason, Roy

    Ross, William

    TELLERS FOR THE NOES:

    Mayhew, C. P.

    Royle, C.

    Mr. Short and Mr. Deer.

    Mellish, R. J.

    Short, E. W.

    Clause 13.—(COMMENCEMENT OF PROCEEDINGS AND VENUE.)
    Amendment made: In page 11, line 36, leave out "or Northern Ireland ".[Mr. P. Thorneycroft.]
    Amendment proposed: In page 11, line 38, at end insert:
    "and no such proceedings shall be instituted in Northern Ireland except by or with the consent of the Attorney General for Northern Ireland or the Registrar ".—[Mr. P. Thorneycroft.]
    Sir J. Hutchison: It may be that I have wrongly interpreted the meaning of the words in the Clause to which this Amendment refers. To me they are rather puzzling. To whittle them down to their essentials it appears that under Clause 13 (1)
    "No proceedings … shall be instituted … except by or with the consent of the Director of Public Prosecutions or the Registrar."
    I am not quite clear whether that means that the Registrar himself can initiate a prosecution. If that is so, then I think that it is undesirable that he should. There is a psychological advantage in the Registrar not being regarded as a prosecutor of industry. Normally
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    the procedure would be for the Registrar to inform the Director of Public Prosecutions and, with the consent of the Registrar, the Director would, in fact, carry out the proceedings. If I am right in thinking that the Registrar himself can do so, may I have my right hon. Friend's assurance that that power will be used on the minimum number of occasions; in short, that the Registrar should be discouraged from initiating proceedings and that it should be left to the proper individual to take such action, namely, the Director of Public Prosecutions?
    Mr. P. Thorneycroft: The answer to my hon. Friend is, "Yes, the Registrar can." The reason is that it does seem rather heavy-weight action to call in the Director of Public Prosecutions on every possible occasion for such offences as failure to register and failure to comply with a notice under Clause 11 and so forth. We will certainly give consideration to this point but there are precedents for this type of proceeding. Under the appropriate Act the Registrar of births, deaths and marriages can take proceedings for failure to register and, on

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    the whole, I really think that it is probably a tidier, more expeditious and more sensible arrangement than to refer what are not criminal offences in the ordinary sense of the word to the Director of Public Prosecutions and to marshal all the panoply of the Prosecutions Department on every possible occasion.
    Mr. Turner-Samuels: I should like to know where the line of demarcation is to be. What are to be the cases in which the Registrar is to intervene and what type of cases are to be directed to the Director of Public Prosecutions? I agree with what the President says as to the sense of not bringing in the Director on every matter—naturally, that would be absurd—but there should be some line of demarcation.
    Mr. Thorneycroft: if I may say so, that would be rather ad hoc in particular cases. It would not be possible to lay down precise details in such a wide and complex field as this. I can say to the hon. and learned Member for Gloucester (Mr. Turner-Samuels) that one would presume that the Director of Public Prosecutions might be consulted in cases of rather exceptional importance—
    Mr. Turner-Samuels: Grave cases.
    Mr. Thorneycroft: Grave cases, yes, or cases of rather exceptional importance—or cases where there had been a large-scale, deliberate attempt to evade. I imagine that in that type of case one might bring in the Director, but we are rather anxious that he should not be brought in in the ordinary run of cases.
    Amendment agreed to.
    Further Amendment made: In page 12, line 1, after "Prosecutions", insert:
    "the Attorney-General for Northern Ireland".—[Mr. P. Thorneycroft.]
    Mr. A. J. Irvine: I beg to move, in page 12, line 13, to leave out subsection (4).
    The Deputy-Chairman (Sir Rhys Hopkin Morris): It may be convenient to take with this Amendment the next two Amendments, in line 14, leave out "three" and insert "six", and in line 15, at end insert:
    "came to the knowledge of the Registrar".
    Mr. Irvine: The purpose of the Amendment is to stiffen the penalty proceedings under the Bill, which we think are not firm enough, to meet the purpose which on both sides of the Committee we are agreed is our aim. The Clause provides that,
    "No information shall be laid or proceedings commenced in respect of any such offence as aforesaid more than three years after the commission of the offence."
    I recognise that the period of three years has clear, interesting and respectable precedents on which we can rely. The period of three years is the period which applies as tiles limit within which proceedings must be taken for offences under the Customs and Excise Act and also for offences under a whole variety of statutes, including those which have regard to false entries on registers of births, marriages and deaths.
    It has come about that there is a kind of statutory sanction for this period of three years as being a reasonable period to put into effect. On the other hand, the period of three years is not universally applied. The Income Tax Act has provided that the period to be applied shall be as long as six years. The Revenue authorities of the Treasury have deemed it desirable—and Parliament has given them support—that, in the matter of tax evasion and the rest, it should be possible to take proceedings for penalties as long as six years after the offence was committed.
    6.15 p.m.
    I do not think that the offences committed under the Bill are very different in character and time from offences under the Income Tax Act. The same consideration seems to me to apply. I should have thought that Income Tax offences are much more analogous to what we are dealing with under the Bill than are those other offences to which I have referred in respect of which a period of three years applies. That is my view on the main issue of the period of time, but much more important than that is that the period of time, whatever it is to be, should run from the date at which the offence comes to the knowledge of the Registrar as distinct from the date of the committal of the offence. That is aimed at in the third of the three Amendments which we are now discussing.

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    It seems to me quite wrong that any other moment of time should mark the commencement of the period of limitation than the moment at which the matter comes to the knowledge of the Registrar. Failing that, all that happens is that the defaulter lies "doggo" and waits for a comparatively short period of time—a period in which the Registrar is fully occupied, as we expect, with a whole host of matters. The three years pass and no action is taken against the offender, and away he goes scot-free. It seems to us a very undesirable state of affairs.
    This gives rise to considerations somewhat similar to those which we considered in the main debate on Clause 12. It points to the fact that in its penal Clauses the Bill gives too great an opportunity to a party to a registrable agreement to do nothing about it and to commit an offence which, though not a positive offence, can be as much an offence against the law as a positive one, namely, the offence of doing nothing.
    Mr. Mulley: My hon. Friend the Member for Edgehill (Mr. A. J. Irvine) has moved the Amendment with such lucidity that there is little for anyone else on this side of the Committee to say. I would make the point, however, that this matter needs to be looked at afresh if, as we understand, the President of the Board of Trade is to create a new offence of failure to register. As the Bill stands, there is no offence until failure to register is discovered and some person is in default after receiving notice from the Registrar. In those circumstances, it would be reasonable to have a limit of three years, but if, as a result of a Government Amendment on Report, the offence is to consist of failure to register, there is a case for making this period one of six years.
    I would also ask the President to look very sympathetically at the third Amendment which would date the period from the time the offence came to the knowledge of the Registrar. In my view, a new situation will arise when the right hon. Gentleman amends the Bill on Report, as he has undertaken to do.
    Mr. Turner-Samuels: A very important point is involved here which has not yet been mentioned. If this were a continuing offence, the limited period of three years might not be objectionable,
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    but the Parliamentary Secretary made reference earlier to a period of three months, at the end of which, he said, the continuity of this offence would cease and thereupon there would be, if the practice still existed, a new offence.
    The advantage of this provision in subsection (4) to an offender is that it will mean that the continuity of the offence committed by him will cease, and, therefore, this limit of three years in the subsection may well be very valuable to him. There is a further significance in this provision. If an offender is caught during the three years whilst his default is causing damage to the public, then he can be dealt with; but if the period is longer than that, and the damage to the public is, therefore, still greater, we are to have no hold on him at all. That really cannot make good sense, and it certainly cannot make good legislation. Why the public interest, which suffers greater damage by the effluxion of a longer time, should be left in a worse situation as against the shorter period, is very difficult to appreciate.
    I am sure that the Parliamentary Secretary did not want to be uncandid about this, because he never is uncandid. I ask him really to apply his mind to the point, because when he mentioned the three months' limit, no doubt quite innocently—if it is possible for the Parliamentary Secretary to be innocent—he said that it was desirable that this offence should not continue longer than the three months, but that if there were a continuation of it then it should be treated as another offence, I cannot think that he really saw what the implications and consequences would be in their impact upon the terms of subsection (4) of this Clause. It is, in my opinion, not right that it should be allowed to stand in that way, because its effect is to constitute an escape Clause for an offender. I ask the President, as I am sure he will, to consider the matter from that point.
    Mr. P. Thorneycroft: I certainly acknowledge that there is a sound point involved in these Amendments, and I think I can meet the principle underlying the arguments advanced.
    I will divide the matter into cases triable by summary proceedings and those triable on indictment. I would suggest

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    that we might leave the arrangements for summary proceedings as they are here, extending the period from six months to twelve months. In principle, I do not think that is very objectionable, because the matters involved are all such as must, in the nature of them, have come to the notice of the Registrar, that is, failure to register on receipt of a notice or obstruction of an officer. Those are offences which must be dealt with summarily, in twelve months, and I do not think that the objections which are potent as regards the other cases are really valid here.
    There are, or there might be, offences under Part I of the Bill, where any person conceals the existence of restrictions imposed by wilfully suppressing documents, and the like; and in those cases there is force in the argument that one should not impose an arbitrary three-year limit. That people have succeeded in suppressing documents for three years is no particular reason why they should escape scot-free. There is, I think, a reasonable argument there.
    If the hon. Gentleman the Member for Edge Hill (Mr. A. J. Irvine) would be content to withdraw his Amendment, for the moment, what I would propose to do is to put down at the appropriate stage an Amendment which would leave the procedure for summary conviction as it stands, but, as regards proceedings on indictment, will either abolish the three-year limit altogether or put in another period, say, three years or six years after the matter has come to the knowledge of the Registrar. I will consider between now and the Report stage what would be the best arrangement.
    Mr. A. J. Irvine: I am much obliged to the right hon. Gentleman for that statement of his intentions. In view of what he has said, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Amendment made: In page 12, line 17, after "Prosecutions", insert:
    "the Attorney General for Northern Ireland ".—[Mr. P. Thorneycroft.]
    Clause, as amended, ordered to stand part of the Bill.

    Clause 14.—(REGULATIONS FOR PURPOSES OF REGISTRATION.)
    Mr. Doughty: I beg to move, in page 13, line 7, to leave out from "be" to the end of Clause and to add:
    "subject to annulment in pursuance of a resolution of either House of Parliament".
    This Amendment deals with the regulations which may be made under Clause 14 by the Registrar in respect of the matters set out in subsection (1), paragraphs (a) to (d). As the Committee will see, the matters covered come within a very wide range indeed, and those regulations will affect a very large number of persons very closely.
    Those regulations, as at present provided, are to be in the form of Statutory Instrument, to be laid before Parliament after being made. That is all; no action can be taken by this House except to pray against them if it be thought fit to do so. Once again, I would remind the Committee that these regulations are extremely important. It was therefore thought right by this Amendment to propose that such regulations should be subject to annulment in pursuance of a Resolution of either House of Parliament, so that we can properly and fully discuss and vote upon them if occasion should arise and the regulations in any way be thought undesirable.
    Delegated legislation cannot be popular in any part of the Committee, or, indeed, in any part of the country. We here examine with great care the wording of all Bills which go through this House, and very often we then give power to somebody to make regulations, and that person can produce regulations in his own form of wording which have very sweeping application. That is a power which, not only in this but in all Bills, we must watch very carefully indeed.
    When such sweeping powers are to be given to somebody upon matters which affect the whole business of this country, or, at any rate, the whole business of those who have agreements which may have to be registered under the terms of the Bill, then, in my submission, we should not allow such regulations to come before the House in this negative form whereby, if we obtain opportunity to do so, we can only pray against them.
    There is good precedent for the Amendment which I have moved. In the Patents

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    Act, 1949, Section 95 has exactly the same type of wording. While not in any way wishing to minimise the importance of patents, they are, in matters of this very wide range, of less importance than the provisions of this Bill. Recently, while glancing through the Agriculture (Safety, Health and Welfare Provisions) Bill which has now been amended by Standing Committee A, I saw that by Clause 16 regulations affecting the safety, health and welfare of people engaged in agriculture may be made, but the power to make those regulations is subject to exactly the same provision as appears in the Amendment I have moved:
    "The power conferred by this Act to make regulations shall be exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament."
    Again I am not for one moment seeking to minimise the importance of the agricultural industry, one of our most important industries; but we are dealing here probably with every single industry in the country, including, incidentally, agriculture itself.
    For those reasons, I submit that it is very important that we should have this much more positive power to deal with these vital regulations. I suggest to the Committee that the Amendment is a proper one and that it should, on behalf of the House, take appropriate steps to ensure that these regulations can be brought before the House and, if necessary, debated and voted upon.
    6.30 p.m.
    Mr. Mulley: I want briefly to support the Amendment. The only doubt I have in my mind is whether or not the words suggested are sufficient to do what I understand the hon. and learned Member for Surrey, East (Mr. Doughty) wants to do; that is, to make these regulations subject to an affirmative Resolution of the House. As I understood him, the words in subsection (3) make it subject to the Statutory Instruments Act and would, therefore, make it subject to negative Resolution. However, no doubt the hon. and learned Gentleman has looked into the matter. I agree that this is an important regulation, and it would be wise that the House should have the matter brought to it, rather than that it should be brought to the House only by the dili-
    454
    gence of any hon. Member who seeks to put down a Prayer.
    Mr. Walker-Smith: Subsection (4) of the Clause as drafted requires that the regulations of the Registrar shall be laid before Parliament. As the Committee appreciates, that is a method of informing Parliament of a Statutory Instrument but it does not give Parliament any actual control of the instrument in question. There are two forms of control. There is the control known as the negative control, whereby a Statutory Instrument which is laid can be annulled within 40 days on what is normally called the Prayer procedure. Then there is the much more rare procedure, whereby a Statutory Instrument does not come into force at all unless it gets the affirmative Resolution of Parliament.
    My hon. and learned Friend has chosen the middle course here which is, I agree, an improvement upon what we have in the Bill. It means that the regulations will become subject to parliamentary control, which they are not under subsection (4) at the moment, in a form which is obviously suitable for this kind of regulation. However, it would not be right to put upon Parliament the burden of an affirmative Resolution in every case where the Registrar made procedural regulations. I hope that the Committee will think that the Amendment strikes just the right balance. As far as we are concerned, we are happy to accept it.
    Amendment agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    Clause 15.—(JURISDICTION AND POWERS OF RESTRICTIVE PRACTICES COURT.)
    Mr. Jay: I beg to move, in page 13, line 10, at the beginning, to insert:
    (1) Subject to subsection (3) of this section as from the expiration of eighteen months from the passing of this Act the agreements particulars whereof are registered under Part I of this Act shall be deemed to be contrary to the public interest and unlawful in respect of such of the restrictions mentioned in section five of this Act as are mentioned in subsection (2) of this section and such order may be made in respect of the said restrictions as might be made if the said restrictions were restrictions determined to be contrary to the public interest under the provisions in this Act contained but no criminal proceedings shall lie by reason of the said agreement being made unlawful as hereby provided.

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    (2) The restrictions referred to in subsection (1) of this section are restrictions which have the effect of requiring that—

    (a) suppliers of any goods shall discriminate in favour of certain buyers whether by an agreement to sell exclusively to the said buyers or to sell to them at a preferential price or otherwise howsoever, or

    (b) buyers of any goods shall discriminate in favour of certain suppliers whether by an agreement to buy exclusively from the said suppliers or otherwise howsoever, or

    (c) suppliers of any goods shall not sell without imposing on the buyer certain conditions whether for the maintenance of prices on resale or for other purposes, or

    (d) suppliers of any goods shall give a rebate to some or all the persons buying from them calculated on their total purchases from some two or more of the said suppliers, or

    (e) a process shall not be applied to the goods of certain persons or that a process shall only be applied to the goods of certain persons on terms or conditions which are less favourable than those applicable in the case of other persons, or

    (f) restrictions offering to any person rebates calculated as rates dependent on the total value of work done for that person by two or more of the parties to any agreement mentioned in subsection (1) of this section.

    (3) The Court shall have jurisdiction on the application of any party to an agreement under which the said party accepts any restriction mentioned in subsection (2) of this section to declare that such restriction is not contrary to the public interest and the said restriction shall thereupon take effect accordingly.
    (4) The Board of Trade may at any time by order provide that any restrictions referred to in section five of this Act shall be a restriction to which the provisions of subsection (1) of this section apply and the power of the Board of Trade to make orders under this subsection shall be exercisable by statutory instrument; and an order under this subsection shall be of no effect until it is approved by resolution of each House of Parliament.
    I am grateful to you, Sir Charles, for calling this Amendment, because it raises one of the major issues which we want to put before the Committee in our discussion of the Bill. It is perhaps a relief to hon. Members to come to a point of substance after dealing, as best we can, with a large number of detailed points.
    The purpose of this Amendment is to speed up the procedure of the Bill by making unlawful at a definite date—we suggest 18 months after the passing of the Bill—all those forms of collective discrimination which were examined by the Monopolies Commission in its inquiry on that subject, as defined in paragraph 29
    456
    of its Report in six categories, except those on collective resale price maintenance, which are included in the Bill.
    The Commission recommended that this group of practices should be generally prohibited. In this Amendment we are seeking to carry out the main recommendation of the Commission. Incidentally, I think that this is perhaps our main difference with the President of the Board of Trade over the Bill, apart from the question of the Court and the Commission.
    During the Second Reading debate, the right hon. Gentleman was a little inclined to misrepresent what other people were saying on one or two points, although he has not done so since. Therefore, I want to clear up two points straight away. First, the right hon. Gentleman seemed to misrepresent the recommendation of the Commission. He said in his Second Reading speech that the Commission
    "did not recommend outright condemnation, but recommended instead an inevitably elaborate procedure for licence and exception."—[OFFICIAL REPORT, 6th March, 1956; Vol. 549, c. 1940.]
    This carried the implication that what the Commission recommended was more like what the right hon. Gentleman was doing. Yet what the Commission actually said in paragraph 246 was this:
    "We believe it follows logically from the conclusion that these practices operate generally against the public interest that they should be generally prohibited."
    Again, in paragraph 249, the Commission said about the practices we are dealing with here:
    "…We believe that all the practices falling within our reference should be prohibited by law, provision being made for exceptions on grounds which would be set out in the legislation."
    Those are the two relevant quotations. Certainly, we agree that there must be some procedure for exceptions, but I submit that it is wrong, in view of those two quotations from the Report, to say that the Commission did not recommend outright condemnation. It did, and we accept that recommendation.
    Secondly, the President in the same speech also misrepresented what we on this side of the Committee are putting forward. As far as I could make out, the right hon. Gentleman had so made up his mind that we on this side wanted to make certain restrictive agreements a

    457
    criminal offence, that no matter how often we told him we did not want to do so, he insisted on continuing to say that we did.
    The right hon. Gentleman seemed to me to suffer from the strange delusion that we could not make any practices unlawful by a certain fixed date without making them a criminal offence. Indeed, as I listened to the right hon. Gentleman, I almost wondered whether the reason that he had decided to leave prohibition out of this Bill was because he had somehow been persuaded that it could only be put in by making the corresponding practices a criminal offence. He said a great deal about the odour of criminality.
    This was a curious delusion because what we seek to do, though on a different group of practices, is precisely what the President is himself doing in his own Clause 19. That is not with reference to what we are not now discussing, but to collective resale price maintenance. But the Clause states, in subsection (1), that that group of practices shall be "unlawful," and it goes on, in subsection (6), to state that
    "compliance with this section shall be enforceable by civil proceedings on behalf of the Crown for an injunction or other appropriate relief."
    That is precisely what we wish to apply to the wider group of practices, so I can only suppose that the President, in his argument on that point, had not really fully appreciated what was in his own Bill.
    Anyway, what we propose, to put it simply, is that, first, the practices condemned by the Report of the Monopolies Commission on collective discrimination should be declared unlawful at a date eighteen months after the passing of the Bill. They should be declared unlawful in the same sense as the President wants to declare collective resale price maintenance unlawful under Clause 19.
    Secondly, we say that a prima facie case would have to be made out by that date before the Commission by a party to a practice if the practice was to continue after that date. We agree that the Commission says that that would have to be done. Thirdly, in the case of the wider group of practices which were not covered in the Commission's Report but are covered by Clause 5, we accept the general registration procedure proposed by the President but improved in
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    the way we have been trying to induce him to improve it in recent days.
    On the main issue before us as to how to deal with the restrictive practices, there are really two views which are possible. Admittedly, there is a great deal to be said for both of them. The first view is that the best procedure is to declare restrictive practices illegal by a certain date unless, before that date, a case has been made out for exemption. The second possibility is to let all the restrictive practices go on until a case has been made out against one or the other of them individually. That is the dilemma in which we all find ourselves.
    My hon. Friends and I take what I submit is the commonsense compromise view, that we should, first, apply the first, and tougher, procedure to the group of practices which has already been generally condemned by the Commission after an inquiry of several years' duration, and, secondly, that we should apply the more protracted and less tough procedure to the wider group which has not yet been examined and condemned. That is a summary of the view that we take.
    One thing is perfectly clear whether we proceed on our lines or the lines proposed by the Government, and that is that our proposal must be a speedier way of dealing with the worst practices. It may be too summary, and I will say a word about that in a moment. Whatever the Parliamentary Secretary may have said, I think the Committee must agree that our proposal represents the speedier method. After all, if we say that the worst cases shall be illegal by a certain date—we suggest 18 months after the Bill becomes an Act, but we are not dogmatic about that period; we should be content with a reasonable fixed period after the passing of the Bill—it must be a speedier method of dealing with the matter except perhaps for a very few practices which may have gone through the procedure of registration and condemnation under the President's proposals by the expiration of 18 months from the passing of the Bill, and I should have thought that very few would do that.
    I will give one illustration of how the period proposal would apply. The President knows, because he has had evidence of it, that there is a group of restrictive practices operating at present in the retail tobacco trade. Information has been

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    sent to me by one independent firm to show that it is being prevented from marketing its cigarettes in any retail shops because the Imperial Tobacco group, which markets 80–85 per cent. of the cigarettes now sold, takes the view that it does not wish this competitive brand to be sold.
    What is happening at the very time we are discussing these matters is that any tobacco retailer who sells the competitive brand finds, after a few hours—in one case it was a few minutes after putting the cigarettes in his window—that certain people, called inspectors, from the Tobacco Trade Association arrive and tell him that if he continues to sell the cigarettes the great bulk of his supplies will be withheld and he will be put out of business. One retailer in the North of England defied this restrictive practice and has been put out of business as a result.
    When the managing director of this independent firm first read about the President's Bill, he said, "This is a fine thing. As soon as the Bill is passed, all this will stop." Then he read the speeches from the Opposition side of the House during the Second Reading and he realised that it was not as simple as that at all. He asked me whether I could tell him the date by which the practices of the Tobacco Trade Association would become illegal. I could not tell him. I addressed a Question to the President, but he was unable to tell me any date by which the practices would be stopped. That is the position as the Bill now stands. Under our proposals—I mention this to make the argument concrete—we could say to that firm and to retailers who are threatened with victimisation that the practices would be stopped 18 months after the passage of the Bill.
    6.45 p.m.
    We have been able to make a little progress, at any rate in the matter of registration. The Parliamentary Secretary has now assured us—at any rate, he has more or less assured us—that within one month of the passing of the Bill he will call for the registration of a wide group of practices, and that three months after he has made the Order, if that is the correct way to describe it, he hopes that registration will take effect.
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    All this means is that we now know, or think we know, that by four months after the passing of the Bill a certain group of practices will have got as far as registration. Of course, nothing will by that time have gone before the courts, unless things move much more speedily than anyone has suggested, and nothing will actually have been prohibited.
    Consequently, it is clear that the procedure that we propose, whatever other objections there may be to it, must operate far more speedily than the method that the President has in mind. It may be said, as the Parliamentary Secretary said on Second Reading, that when Henry VIII cut off people's heads, it was speedy but it may not have been just. I agree with him that we have to ask whether the method is not merely summary, but fair.
    However, when we get to that stage of the argument we have to remember a vital point which has not been very much emphasised so far in our discussions, and that is that the Commission, when it was faced with precisely this major dilemma and decided to favour our alternative, described the President's alternative as cumbersome, slow and unfair. It thought it unfair for this reason. If we go stage by stage and step by step, inevitably at any given date we have condemned, outlawed and terminated certain restrictive practices in one industry or one type of trade, but those practices may be operating in another trade at the same moment and they may continue to operate there for a long period.
    I do not think that the President will disagree that in the case of the match industry the Commission was divided as to what recommendations it should make. Some members of the Commission said, "This ought to be condemned". Other members said, "This is quite wrong, but one cannot condemn it in the match industry because many other people are doing it; it would be quite unfair to stop it in one industry and not in others." For that reason, the Report was not nearly as drastic as it might have been.
    It may be said that, in spite of that, the outright prohibition procedure would be bound to be too summary for a certain reason. I agree with the President that, whatever we think, this is the heart of the difficulty. It may be argued that if the Commission, as we would suggest, is

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    to hear all cases proposed for exemption within as short a period as 18 months, either the examination will be perfunctory or, if it is not, the Commission would be snowed under by work and the Minister will be snowed under by applications and appeals.
    I mention the Commission here, because we are proposing that it should do the job. According to our whole scheme throughout the Bill, it would be the Commission. I agree that if some of our Amendments were accepted and others were not, it would be the courts which would do it. It is slightly difficult to conduct this argument, but it is our view that the Commission should do the job.
    It seems to us that, although it would certainly be a hard job, it would not be unmanageable. Let us remember that we are not proposing to apply this to the whole vast field covered by the Bill and by Clause 5. We are merely proposing to apply it to the much more limited field covered by the Commission's recommendation. That limits the field. Even within that field, I think it is clear that if we were working this more drastic and more speedy procedure, a great many of those responsible for the agreements would do what we agree some of them do even under registration, and that is terminate their agreements and not go through the time and trouble of coming forward and trying to make out a case.
    Thirdly, the Commission—we are proposing that the Commission should be doing the job because that is the substance of our case on this point; and surely it would be practicable for it to do so—could rule out all cases as soon as there was a general prohibition where there was not a strong prima facie case for making an exception. That would limit the scope of the work a little further.
    Finally, I would have thought that we need not be so frightened here by the President's argument that, in these circumstances and if we try to speed up the procedure by bringing this before an improved and enlarged Commission rather than a Court, there would be continued appeals to the Minister and the whole process would break down at that point. We have already pointed out that the Minister, in these circumstances, does not
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    have to deal with every single case personally. It would, of course, be necessary—I fully grant this to the President—and the Commission said so—under this sort of scheme of things for the Commission, or whatever body was considering the exemptions, to grant interim exemptions in certain cases where a prima facie case had been made out, and some would have to be granted.
    It may be argued—and this I think is the point of the argument to which we are all led—that even after all this there may be some residue of hardship, because there will be some traders in some industries who will be compelled to desist from their agreements without a very full and elaborate inquiry having been carried out. I would not deny that it is impossible to say that there may not be some residue of hardship of that kind, but I think that we really get the perspective all wrong if what we ask ourselves here in this Committee is: will there be any hardship at all to the producers involved in this procedure—will there be much, just a little, or absolutely none?
    The real issue surely is: does that residue of hardship, if it exists, which falls upon the producers and traders carrying out these agreements, really outweigh the hardship now suffered by the consumers due to the continuance of the agreements? I think that to get this into perspective we must look at it in that way. It seems to me that in this country, due no doubt to the conditions of the 'thirties and of events which we well know, that the producers have had a good run in all these matters and the consumers have had remarkably little say and remarkably little influence on what has been going on. I think that we have to weigh the hardship of those who may suffer from the continuance of these agreements on a large scale against the hypothetical, small hardship to some of the producers and traders who may suffer less.
    Do not let us suppose that it is only the final consumer, the housewife, who is suffering from the continuation of these agreements. After all, in the case of the tobacco retail trade conditions which I have described, it is some of the small retailers themselves who are suffering just as much as the public as a result of these restrictive practices. Therefore, we feel that on the final margin of doubt

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    here, it is time that the Committee and the House gave the benefit of the doubt to the consumers and those who have been injured rather than benefited by these restrictive practices.
    For that reason, we commend the Amendment to the Committee as likely to do more, I think, to strengthen and make more effective the President's Bill than most of our previous Amendments.
    Mr. P. Thorneycroft: As the right hon. Member for Battersea, North (Mr. Jay) said, this is an interesting Amendment. It raises a difference in approach to the various methods, not, I think, a difference in aim but a difference in method, as to how these matters should be dealt with.
    What I hope to establish about the right hon. Gentleman's method is this. First, that it would be a very difficult method to apply in practice. It would certainly take just as long as the method described and it would, in fact, be putting the cart before the horse inasmuch as it would make certain that the less important things were discussed and considered before the more important things. The whole question of whether it is drastic or not or whether there is more hardship or not so far as hearings are concerned is quite irrelevant, because the provision for hearings under his method—except that he puts in a Commission instead of a Court which, no doubt, we shall discuss when we come to that part of the Bill—despite the nominal 18 months' period would be precisely the same under his arrangement as under the arrangement in the Bill.
    I am grateful to the right hon. Gentleman for putting down the Amendment. I am glad that we have an opportunity of discussing it, because it gives me the opportunity of demonstrating the difficulties of any approach to this complex matter other than that outlined in the Bill. The right hon. Gentleman based himself to some extent upon the Report of the Monopolies Commission. Incidentally, the Commission was divided on this issue as well as on the other ones which he mentioned, and the majority Report came down in favour of something rather like that which he has been proposing to the Committee.
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    I say "rather like" it. The Commission was much more specific and definite and approached the matter with rather more clarity than did the right hon. Gentleman. The Commission says—and the right hon. Gentleman mentioned that I had mentioned criminal offences—in paragraph 248:
    "Legislation of the type we propose would create a new criminal offence."
    The right hon. Gentleman—let me be absolutely fair about this—does not say that. The Commission went on to say:
    "It is important, therefore, that the prohibited practices should be clearly defined, so that the business man would know exactly what he might and might not do."
    7.0 p.m.
    Leaving aside whether prohibiting a practice, and presumably imposing penalties for doing it, is technically a criminal offence—I do not want to draw the Committee into a debate on that matter—I think that what is important is that where we are prohibiting these things, they have to be defined with meticulous accuracy. I wonder whether any hon. Member of the Committee who listened to our debates on Clauses 5 and 6 as to what should precisely be included or excluded even from the field of registration, imagines that we, as a Committee, are at this moment in a position to define clearly and accurately the range of offences which shall be absolutely prohibited? I do not imagine that there is a single hon. Member who believes that such a thing is possible today. If they were to be outlawed tomorrow morning, the debates on Clauses 5 and 6 would have been prolonged for a very long time.
    We were there discussing arrangements which should be registrable and subject to examination, but this would go much further. The scheme suggested by the right hon. Gentleman is this. He says, "Legalise the range of these arrangements for 18 months. Say that they can carry on. And then, at the end of 18 months, say that the guillotine must fall and that they are rendered unlawful."
    Mr. Jay: The President says "Legalise for 18 months." But they would be no more or less illegal than under the Bill.
    Mr. Thorneycroft: I am not saying that they would be. I am talking about what is done by the Amendment. The right hon. Gentleman need not be

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    ashamed of his Amendment. I am not saying that these arrangements should be outlawed tomorrow morning, but we must look at the Amendment and discuss it.
    The right hon. Gentleman says that we should render these things lawful for 18 months and that at the end of that period the guillotine would fall and they would become unlawful. But he knows, as I and every hon. Member knows—and as is admitted in the Amendment—that that would be utterly unworkable and unacceptable to any section of the public. Therefore, very properly, the right hon. Gentleman provides a let-out in subsection (3) and says that under that subsection an application may be made to the Court or the Commission—I am not discussing now whether it should be a Court or a Commission—to allow them to carry on.
    If we are to have an application of that kind, we must lay down some criteria, or else the process would be interminable. I can only imagine that the criteria which the right hon. Gentleman would lay down would be something—I am not pinning him to a precise definition—on the lines of Clause 16. Perhaps a little narrower or a little wider, but something like that.
    Under the Bill, the arrangement is that the practices must be registered and then must be considered by the Court in the order laid down, or which can be laid down by direction of the Board of Trade. Under the right hon. Gentleman's scheme, instead of the registration of particulars, we should have an application to carry on the arrangement, made under the provisions of subsection (3). But it seems to me that the one is the exact equivalent of the other. We may call it something different. It means that if anyone wishes to carry on an arrangement under the Bill, he has to give particulars and register it, or under the scheme he must make his application. There are different procedures, but the effect is the same in both cases.
    I am not quarrelling with it. I consider it perfectly right that any man, or body of men, who have an arrangement of this kind which they think ought to be allowed to carry on can come before the Court—or the Commission or whatever it is—to have their case argued on the basis of some criteria which has been laid down. But is it to be assumed that an application to carry on, made
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    under the scheme of the right hon. Gentleman, will ensure that these things will be dealt with any quicker? It cannot be so assumed. What will decide the speed is the speed of the Court—or the Commission or whatever it is—in either case. On that we may have disagreement as to whether it be a lay tribunal or a judicial tribunal, but there is not the slightest difference, so far as speed is concerned, between the suggestion of the right hon. Gentleman and any other suggestion.
    Mr. Jay: The President will appreciate that under our suggestion, unless an application is approved within 18 months, the restriction must terminate at the end of that period.
    Mr. Thorneycroft: I give the right hon. Gentleman credit for this. I am quite certain that he is not suggesting to the Committee that he fixes an 18-month period; and that if at the end of that period—because they happened to be lower down in the list by chance—a certain number of cases had not been heard, then, without any hearing whatsoever and irrespective of whether these arrangements are for or against the public interest, they would be outlawed. I know that the right hon. Gentleman is not suggesting that. Nor would it be suggested by the Monopolies Commission or by any sensible person. So, as I say, there is really no difference whatever so far as pace is concerned.
    There is a great difficulty, which I think was recognised by the majority of the members of the Commission, but not recognised to the full by the right hon. Gentleman, about the exact definition of practices which would be banned. After all, there is a worse flaw in this Amendment, and this is where I think it is open to rather severe criticism. This Amendment takes the group of practices concerned with collective discrimination and would outlaw them. I put it to the right hon. Gentleman: is not that putting the cart before the horse? The great number of these collective discrimination practices are enforcement practices. Will it not be better to allow us to get on with the examination of the price rings themselves?
    This Amendment makes it absolutely sure that, whether it is a Commission or a Court, it will be cluttered up by

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    having to deal with methods of enforcement while the reality is hidden behind. A period of 18 months is referred to, but in my estimation that is "eyewash," because anyone who is not heard within the 18 months must have an opportunity of being heard afterwards. It would make certain that until we have been through the whole range of these practices—which on any definition will be a very large number—a number of practices, not least common prices, are to be allowed to carry on in the ordinary way without any examination or check.
    Mr. Jay: But is not that precisely what the President is doing about collective resale price rings? He is not merely approving maintenance but actually strengthening resale price maintenance.
    Mr. Thorneycroft: When we come to the appropriate Clause, I shall argue the reasons for doing so and the right hon. Gentleman will have the opportunity of advancing any criticism.
    I am interested to know from his interjection that this is the purpose of the Amendment, and it seems to me an unfortunate purpose. I hope that the Committee will wish to get on with this job and to tackle the price rings, and the common price-fixing arrangement, and all the rest. I think that we should tackle them at the same time as—certainly not after—the methods of enforcement. I do not think that the right hon. Gentleman has faced the real difficulty of definition in these matters, if it is imagined, after all the intricate arguments on Clauses 5 and 6, that we are really in a position to isolate certain practices and define them with the precision necessary to outlaw them altogether.
    For that reason and because, in any event, on any approach to this every member of a mutually restrictive arrangement will at some time have to be given an opportunity for arguing his case, whether for or against the public interest, so that it will take as long; and last, but by no means least, because it fairly and squarely puts the cart before the horse, I hope that the Amendment will be rejected.
    Mr. Wade: I should like to make one or two observations which are relevant to
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    the Amendment. I wholeheartedly agree with the President in his remarks about price rings. There is no doubt that they should come first. In fact, if price rings were banned, many of the other restrictive practices would fall to the ground. Whether or not one adopts that rather ruthless procedure—I think that it has been adopted in Canada—price rings should come first on the list, or very high on the list.
    The problem which faces the Committee is the fact that no one knows how long will elapse before the Court hears and decides upon agreements which are placed on the Register. There is at least a prospect that that might take a very long time. That will be unfortunate for two reasons. In the first place, it will delay the putting into effect of the policy which the President has advocated, and, in the second place, it will create a certain sense of injustice on the part of those who are brought before the Court first.
    One has heard similar complaints about procedure before the Monopolies Commission. One is asked why a particular industry should be picked on and not others. That complaint is inevitable in a case-by-case procedure. Our problem is how to be fair, while not at the same time encouraging delay, and by that I mean encouraging lengthy legal procedure, the parties taking part knowing that the longer the case takes, the longer it will be before their friends come before the Court.
    It is true that the President has gone some way towards meeting our point of view by agreeing that additional judges should be appointed, but we are still left in a state of uncertainty about how long the Court will take to dispose of a batch of agreements which have been registered—and it may be a very large batch. There is one possible solution. There is no perfect solution which I can see, but I put this forward as a suggestion.
    When a batch of agreements is registered, I suggest that by a specified date they should be banned, or no longer permitted; perhaps "made unlawful" is the appropriate term. Hon. Members may say that that is unfair to those who feel that they have good grounds for exemption. One might overcome that difficulty by allowing parties to an agreement which has been registered to file pleadings. That would amount to pleas

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    in which they would give their grounds for applying exemption.
    The court would then be entitled to decide whether there was a prima facie case merely on the pleadings. That would not involve a great deal of time or administrative difficulty. That would be fair to those who were waiting to be heard and who were convinced that they had a good case. An order might be made that there was a prima facie case and they would be allowed to continue until their case was heard. That would have a twofold effect. It would overcome injustices which might be suffered by those who want to be heard and happen to be lower down the list, and it might encourage firms to apply to be heard rather than to wish to delay.
    Sir L. Joynson-Hicks: I have been following the hon. Member's argument very closely, but I cannot see how it applies to the Amendment. I do not see how he is applying his argument to this particularly procedure.
    7.15 p.m.
    Mr. Wade: At the outset I said that I hoped that my observations would be relevant to the discussion on the Amendment. Perhaps it would have been fair to say that I was not entirely satisfied that the Amendment would be workable or practicable. As the discussion has gone rather wide, and as the President discussed the general issues, I hope that I am not too much out of order in putting forward an alternative.
    I put this alternative, recognising that it is extremely difficult to find an entirely satisfactory solution which will be fair to the parties while not encouraging delay. I am not satisfied that the President appreciates the dangers of long delays and lengthy proceedings before the Court. I hope that before we leave the Clause he will bring his mind to bear on this possible defect, which may go some way to undermining the effectiveness of the Bill and which arises from the length of the proceedings before the Restrictive Practices Court.
    Mr. John Cronin: The President produced some very interesting arguments against the Amendment, but I doubt their validity and I am sure that my hon. Friends will feel very much the same. He quoted paragraph 248 of the Collective Discrimination
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    Report of the Monopolies and Restrictive Practices Commission to suggest that the definition of restrictive practices to which the Amendment refers was rather too loosely drawn. He said, quite rightly, that it is important that prohibited practices should be clearly defined so that a business man might know what he might and might not do.
    The President should have continued to read that paragraph, because he would have found in the next sentence:
    "At the same time, the definition should not be too narrowly drawn, or there would be opportunities for the exercise of ingenuity in evading prohibition by arrangements falling technically outside its scope but having the same effect as those prohibited."
    No doubt it was through inadvertence that the President did not read that sentence.
    That is the crux of the matter. The phrase "restrictive practices" as defined in the Amendment is exactly what is required of a definition. It is quite clear and anyone who practises this type of restrictive practice will know clearly whether he is falling within the scope of the Amendment or not. The President made considerable play with the circumstance that within eighteen months from the passing of the Bill, various restrictive practices would become illegal and up to eighteen months they would be legal and that there would therefore be a sudden guillotine effect.
    I submit that that must be the case, whatever happens, in any legislation. There must be a given moment when the practice suddenly becomes illegal. Surely, the circumstances suggested by this Amendment—a period of eighteen months—show the maximum leniency and consideration for the convenience of the restrictionists involved? It gives them the opportunity to clear up their affairs and also their restrictive practices, without causing some sudden shock to their businesses or trade, as the case may be.
    I thought the President was on a more valid argument when he suggested that the speed of the Court will decide ultimately what happens, and that there is no real difference between his procedure, which is that the Court should take the registered practices in rotation, and the procedure recommended by the Amendment, which is simply that certain practices are to be declared illegal, but there

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    is a right of appeal to the Court. Prima facie, it would seem that that might be exactly the same thing, but, on a comparatively elementary analysis, I think the Committee will agree that there is a very big difference.
    The first difference is psychological, and very important, because under the terms of the Amendment every restrictionist will have a clear idea of what is legal and what is illegal, and the chances are that he will abandon that particular form of restrictive practice. Under the Bill as it stands without the Amendment, the restrictionist will always have a hope that the practice, when registered and ultimately considered by the Court, will be able to escape through one of the numerous loopholes.
    Here there are no loopholes. There are various types of restrictive practices which are very clearly defined, and the proposal has the very significant advantage that every industrialist and potential restrictionist, every supplier, processer or retailer, will know exactly where he stands, apart from a few very infrequent and rather marginal cases, which will no doubt make use of subsection (2) which permits them to apply to the Court for relief. Therefore, I think that the suggestion that there is a similiarity between the two procedures is not really valid.
    The President also made a very emphatic point that we on this side of the Committee were putting the cart before the horse. He pointed out, perfectly correctly in this sense, that the Amendment proposed by my right hon. Friend the Member for Battersea, North (Mr. Jay), outlaws or declares illegal only the enforcement of the practices, and leaves out of consideration for the time being price rings and common price arrangements. I agree with the President, and I think this is a very valid point. Common price rings are much more fundamental and a more serious aspect of the whole subject than merely the manner in which they are enforced.
    I cannot see any objection to dealing with the one rather than the other. Here we have a case in which the restrictive practices mentioned in the Amendment have already been tried and considered by a very experienced and effective court—the Monopolies Commission. That
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    makes quite a difference, and if we have effectively disposed of one type or one group or groups of restrictive practices, if they have been carefully tried, why should we ignore the verdict of the tribunal? Why not accept that verdict which, of course, is the purpose of the Amendment?
    I suggest to the President that it does not matter very much whether we put the cart before the horse or not when we are putting both the horse and the cart on a train, which is what we are doing here. We are dealing with restrictive practices and eliminating them as far as possible, and the circumstance that some are eliminated before others does not seem to me to be very important.
    I think there are other questions which we ought to consider, and one is the danger that is dealt with in this Amendment. One does not want to digress into a Second Reading speech, because if one did not restrain oneself, this Amendment would commend itself to that course. The great difficulty, as the President will agree—indeed, I think he has said so on several occasions—is that there will be considerable delay, and that all these restrictive practices will have to go through a rather slow and tedious mill. They have to be carefully ground by the mills of justice, and in the process it is quite inevitable that the intention behind this Bill will gradually merge into the mists of the past. I think it is quite inevitable that we shall reach a situation in the years to come when judgments will be given on these cases which will be of a type certainly not contemplated by us at the present time.
    First, we have a most extraordinary and unusual kind of court, which will have lay members, who will be drawn from industry. They will be people with no legal training, who will have a deciding voice as far as these practices are concerned. There will be a court of appeal, and from there the right of appeal to the Law Lords in another place. All the time, inferior courts will be bound to accept finally the decisions of the superior court, so that it is quite inevitable that a situation will develop completely different from what we now envisage. At least, if we accept the Amendment for a certain section of the subject, we will have absolute control, because the words are quite specific. They will be construed by the judges in their

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    grammatical and literary sense, and everyone concerned will know exactly where they are.
    I feel reluctant to talk too much about what happens in other countries, but I should like to mention briefly this point. It is, I think, only reasonable, when we are embarking on something quite new in our legislation, to consider how similar legislation has worked in other countries, and what other countries have done in the same circumstances. In the United States, the situation is absolutely clear. All the types of restrictive practices which are mentioned in subsection (2) of my right hon. Friend's Amendment are absolutely illegal. They are not only illegal under the common law, but they are illegal under the Sherman Act of 1890, which was clarified by the Clayton Act of 1914, which codified the Sherman Act. So that, in the U.S.A., the restrictive practices which we on this side of the Committee wish to see made completely illegal are already recognised as illegal. There is no question about it. It is accepted, and everyone knows where they stand.
    7.30 p.m.
    The same situation exists in Canada. Under the criminal code all the restrictive practices mentioned in our Amendment are clearly illegal. Even in Sweden, where they have a system of registration, they have found it necessary to make certain restrictive practices completely illegal. Sweden passed legislation in 1953 absolutely prohibiting resale price maintenance and collusive tendering. That is a very similar case to our Amendment. They have not gone quite so far, but the principle is the same. They have absolutely condemned as illegal certain restrictive practices.
    In Germany there is at present going through the Bundestag a cartel measure which has a rather similar effect to that of my right hon. Friend's Amendment. That measure, which is admittedly not yet law, will make certain restrictive practices absolutely illegal from a given date. I shall not draw any further analogies from other countries, but, of course, the most important analogy to draw upon is that of the President himself. He insists, in Clause 19, that a certain restrictive practice—collective enforcement of resale price maintenance, for instance—is to be illegal.
    He has insisted on that principle in the case of one particular restrictive practice.
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    Why, therefore, does he consider it to be quite out of the question and unreasonable for us to seek to increase the scope to include a series of restrictive practices which have already been very carefully investigated and tried by the Monopolies Commission? I hope that he will have some second thoughts on this, and will give this Amendment some support.
    Mr. Roy Jenkins: The President of the Board of Trade was very eager to intervene in the debate earlier on and, I admit, made a powerful speech which made a very slight dent in the Amendment. But in doing so he torpedoed a great deal of his restrictive practices policy in this Bill and elsewhere over the last few years. Towards the end of his speech he said that he had now come to the conclusion that these practices which really amount to machinery of enforcement were very much the less important part and what he was concerned about was the basic reality of restrictive practices—common prices or whatever it might be.
    I have some sympathy with that point of view, but I think that that argument comes most oddly from the President of the Board of Trade, who has introduced a Bill containing Clauses 19 and 20. Quite apart from the point on Clause 19 already made by my hon. Friend the Member for Loughborough (Mr. Cronin) that here the President is prepared, without there being any right of appeal so far as individual agreements are concerned, to go far further than my right hon. Friend the Member for Battersea, North (Mr. Jay)—whose Amendment the right hon. Gentleman says is most unreasonable—and when he himself tells us that the machinery of enforcement is quite unimportant, he comes with his Bill which says the enforcement machinery is important.
    If we are now to be told that this whole range of practices which are referred to in this Amendment—and which are, broadly speaking, the practices which the Monopolies and Restrictive Practices Commission reported on last summer—are comparatively unimportant, why does the President go out of his way to ask the Commission to make a special inquiry into those practices? It is a rather odd way of making progress in an anti-restrictive practices Measure. It seems that first

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    the right hon. Gentleman tells the Commission to devote all its energies for a number of years to investigating a certain set of practices and then, when the Commission reports, he comes to the House and, for the purpose of defeating this Amendment, says, "I think that these are really rather unimportant and we are concerned more with the reality." Whatever may be said about the Amendment, that is a very strong comment on the policy pursued by the President over the last few years and if, by inadvertence, he went rather further than he intended in his reply to my right hon. Friend, perhaps he may address the Committee again and correct the unfortunate impression which he has given in this respect.
    I do not think that my right hon. Friend the Member for Battersea, North was being at all unreasonable in suggesting that there should be a time limit of eighteen months, and that what had not secured exemption by then should be automatically banned. One has to take risks in this matter and administer a certain amount of rough justice—there is no question about that, and no reason to be ashamed of it—if we are to make a really effective anti-restrictive practices measure. The Government recognise that by Clause 19. Therefore, there can be no objection in principle so far as the President is concerned in saying that certain things shall be banned without there having been a hearing. As my hon. Friend the Member for Loughborough has pointed out, all these practices that we are discussing have already been very fully considered by the Monopolies and Restrictive Practices Commission.
    I think that one of the advantages of having a tribunal or court and saying that those practices which have not secured specific exemption within eighteen months should be banned, whether or not they have been heard, is that it encourages industry to form an effective queue of priorities for itself. One of the difficulties that we have to face is that if we frame legislation in a particular way there is a real danger of the court or tribunal, or whatever it is, being clogged up with a series of unimportant matters; and we have accepted the various proposals put forward by the President to try to overcome that danger.
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    I think that my right hon. Friend's Amendment would be a very important contribution towards solving the difficulty, because, if there is to be a guillotine applied which will fall after eighteen months, I can think of nothing which would more encourage industry not to clutter up the courts with appeals of that nature, but to form its own queue and to bring forward classes of agreements which are important to industry and for which industry considers there is a real chance of getting exemption. I hope that the President will address himself to that point.
    Sir Leslie Plummer: I gathered from the President's speech that he was not really so much concerned with the kind of restrictive practices which are specified in this Amendment as with price fixing, level tendering and other vices which he has in mind. Of course, he has to have priorities, and if I were in his position I am not certain that I would be able to say at this stage that I had categorically made up my mind which were the most vicious of the practices that I was trying to prevent and which I would now put in the topmost priority of my determination. It did occur to me, however, that what the President was doing was to overlook the size, importance and the character of the restrictive practices which this Amendment seeks to bring rapidly to an end and before a court.
    I think that one of the most frustrating things that enterprise has to deal with today is to find that by some chance or another—or some deliberate action or another—one is prevented from following one's competitor on the lines and in the manner which have been followed before. Let me give an example. I have been making some investigations into what goes on in the tobacco trade and the tobacco business. One of the developments of our social life at the moment is that to sell anything it is necessary to offer more than the intrinsic product itself; one has to pay a lot of attention to the packaging. Packaging is what advertising men call the "gimmick," and it is almost as important to the sales staff as the product inside.
    I have found that the packaging of cigarettes and the control of the supply of packets is largely covered by a restrictive agreement organised by one of the

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    big tobacco combines in this country. In my constituency is the largest firm of tobacco packaging and filling machinery manufacturers in Great Britain. I learned the other day that it had devised both a new package and a new filling machine to put the cigarettes into the package. This company was prepared to sell the machine which makes the package and the machine which fills the package.
    It was clear that as a result of these machines a new kind of package was being marketed by one of the subsidiaries of one of the tobacco combines. Indeed, it was being widely advertised. When an independent company went to the firm and said, "We ourselves can make this packet, but we need your new machinery to fill it; will you please supply us with that machinery?", they were told, "No; we are not selling this machine, except to the tobacco combine, for three years". This means that the combine is able to ensure for itself three years of unrestricted competition. Such a restrictive agreement can continue for a further considerable period under the Bill, unless the Amendment is accepted.
    I suggest that we should take the view that the opportunities for enterprise of this kind should be made available to every firm, within reason. Obviously, if a firm is filled with orders it cannot take more, but it should not be in a a position in which it can pretend to be filled with orders, or can arrange to have a fictitious demand as a result of which the company at present getting its product can rely on being the sole beneficiary of the product.
    Mr. David Ormsby-Gore: Is this company, which manufactures the machinery, tied up with the big tobacco companies?
    Sir L. Plummer: Yes. That is the point I am coming to.
    The investigation which I made shows clearly that one of the big tobacco companies has a significant investment in the company manufacturing packaging machinery and cigarette-filling machinery. I cannot say that it controls it; all I can say is that it has a significant investment in it. It is careful not to confine the sales of the products of this packaging company to itself or its subsidiaries; it
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    at least gives the appearance that the products of this company are freely available to everybody.
    In fact, as I have shown, they are not freely available—at least, not until such a time has elapsed that the novelty of the new device which this company produces has worn off and, therefore, has no particular advantage to the independent trying to obtain it. This case is covered by subsection (2, a) of the Amendment.
    I want now to deal with the next subsection to the Amendment, which also demands attention and which defines as within the restrictions circumstances in which buyers of any goods
    "discriminate in favour of certain suppliers whether by an agreement to buy exclusively from the said suppliers or otherwise howsoever … "
    7.45 p.m.
    If hon. Members have recently travelled by British European Airways to the Continent they will know that soon after the aircraft takes off a steward comes round and offers to sell cigarettes, which are very acceptable to the smokers because they are duty-free and, therefore, very cheap. The cigarette which is offered more than any other is one comparatively unknown in this country; it is not stocked by most tobacconists or most hotels or restaurants. Yet its sales are the largest of those made by B.E.A. In fact, this comparatively unknown cigarette represents about half of the sales of cigarettes by B.E.A. The other half of the sales is organised on a rota basis in accordance with the popularity of the other branded cigarettes as shown by their sales in this country.
    This means, in fact, that a reasonably popular cigarette in this country, but outside the range of those produced by the Imperial Tobacco Company, is carried on the equivalent of one out of 22 B.E.A. flights. Why is this? One discovers that the cigarette which is relatively unknown in this country is manufactured by a firm in which an export tobacco company has a very large financial interest, and that that export company itself is a subsidiary of one of the big tobacco combines. Between the export company, the manufacturing company and B.E.A. there appears to be an agreement which sees to it that the independent manufacturer

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    has only a chance in one out of every 22 flights of having his cigarettes made available to the customer.
    These are most important restrictions. They represent a restriction on the man who is trying to get into the market. They represent a denial of freedom of choice to the consumer. We ought to be as much concerned with—as it were—the end product of this Bill—the consumer—as we are with those who are carrying on these restrictive practices.
    I want to see these practices stopped quickly, because I think that they are a negation of free enterprise. I cannot understand why hon. Members opposite, who are always arguing about the advantages of free enterprise and free competition, are so ready to retain these restrictive practices. In my view, the Amendment seeks to bring them to an end speedily.
    For that reason, I do not understand why the President of the Board of Trade was so passionate in denouncing my right hon. Friend, who very properly, reasonably and lucidly argued his Amendment. Unless we have an alteration in the Bill, such as is suggested here, my fear is that these practices—and the examples which I have given are but two out of hundreds taking place in this country today—will drag on tediously over such a long time that, before we realise it, the Bill will be a dead-letter soon after having been passed and quite useless for its purpose.
    Mr. G. Darling: I was not greatly impressed by the right hon. Gentleman's attack on the Amendment on matters of principle because, as has been pointed out, in principle it is in line with his Clause 19. That point has been adequately dealt with and I will not develop it again. Nor was I greatly impressed by his attack upon the 12 months' time limit, mentioned in the Amendment. When we are trying to discuss how long it will take different types of procedure to deal with the restrictive practices which we want to see dealt with, we are in difficulty for the simple reason that we do not know how many restrictive agreements the Court will have to deal with. To a very large extent we are working in the dark; therefore to criticise the 18 months' period in this Amendment seems to be completely beside the point.
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    In his Second Reading speech, the right hon. Gentleman said—and he has confirmed it—that it is his intention to submit to registration common pricing, level tendering and the worst forms of discrimination, but, if the Bill is not amended in the way we have suggested, I do not think that the actions which should follow from such registration will be as swift and as satisfactory as he and every hon. Member of the Committee want.
    As Clause 15 now reads, the Restrictive Practices Court will have the jurisdiction, the right, to declare whether or not any restrictions contained in registered agreements are contrary to the public interest. The Court may do that, on the application of the Registrar. That itself, I believe, will be a limiting factor. We have already discussed the question of who can make representations to the Court, but as the Clause stands the Registrar will take to the Court agreements which in his view are contrary to the public interest.
    We do not know how many agreements will be dealt with, and no one knows how long the procedure on each agreement will take in the Court. From experience of discussion of this Bill and the way in which lawyers can get to work to delay things, it is not suggested that the procedure of the Court will be extraordinarily rapid. It may take, not 18 months, but many years before we get the major restrictive practices which we want to see put out of existence really dealt with.
    It is true that under Clause 18 the Court can build up a body of case law which will guide people in deciding whether an agreement should remain in existence and will also guide the Court in its judgment. Under Clause 18, the Court will not need to examine each case; from the body of case law that it builds up it will know how to deal quickly with each case that comes along, but, as we are working completely in the dark about the number of agreements and the manner in which they will be dealt with—at least at first—how the Court will operate, how appeals will operate and how the lawyers' paradise will operate, I suggest that there is a strong case for this Amendment.
    In the Amendment, on the lines of the majority Report of the Monopolies Commission, we are defining practices which

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    we think ought to be dealt with and the manner in which we think they can be dealt with speedily. It is no use the President or anyone else in the Committee saying that if we have the procedure as outlined in the Bill we shall be able to deal with these matters fairly quickly, because no one knows about that. Under the procedure suggested in this Amendment we should make a large number of restrictive agreements unlawful by the definitions laid down, and the 18 months period to get the whole business sorted out is, I think, satisfactory. Under this procedure, at the end of 18 months we should be far more ahead with the job which the Bill seeks to accomplish than would be the case if the Amendment were not accepted.
    I therefore suggest that on the grounds of speed—there cannot be further argument about matters of principle because in principle this is in line with Clause 19—the Amendment ought to be accepted.
    Mr. Arthur Holt: I should like to say a few words about the Amendment before the President replies to the debate. My party would be only too pleased to support the Amendment if we really felt that it would help to achieve the results which we all desire, which are to bring an early end to any restrictive practices which we can bring to an end and, where any have to go before the Court, to ensure that the effects which we consider most undesirable and which have the greatest effect on the economy should be brought to the Court first.
    Although some might think it rather irresponsible, I should, if the Amendment did not contain subsection (3), be personally delighted to support it because it would abolish this type of practice without any appeal. There would be no question of holding up consideration on common prices, price agreements and the like. I think that all the types of practices described there are thoroughly undesirable. I do not accept that there are any conditions under which any of them should be allowed to continue, but that is not what the Amendment says. Many people who at present carry on those practices do not hold my view, but would apply to the Court for consideration and to be allowed to continue those practices in the public interest. That would greatly delay consideration of other forms of
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    restrictive practice, such as common prices and other kinds of price agreements which we consider far worse in their effect on the economy.
    Another point which has been mentioned, but which I should like to underline, is that some of these practices will cease—there would be no point in their further continuation—once various forms of price agreement had been declared illegal, as is clearly stated in the Report of the Commission when dealing with discrimination. Under subsection (2, d) rebates are directly associated with supporting price agreements, but if price agreements were declared illegal, there would be no point in trying to have such practices to support them because there would be nothing to support.
    As the President said, we should deal with the major matters first. I have no doubt that the hon. Member for Stechford (Mr. Roy Jenkins) is aware of why it was desirable to work up public interest and to choose some of the practices that were taken to the Monopolies Commission first. They were matters which obviously would stir up public interest far more than, for instance, the question of common prices.
    Mr. G. Darling: No. The hon. Member is quite wrong.
    Mr. Holt: I think that the President was quite right to put that type of restrictive practice before the Monopolies Commission rather than the question of common prices at that time.
    Mr. Roy Jenkins: Is the hon. Member seriously suggesting that the order in which practices were referred to the Monopolies Commission should be determined by what the President thought would make interesting reading?
    Mr. Holt: I would not put it quite so crudely as that, but surely, as a politician, the hon. Member for Stechford will realise that if one wants to reverse a trend which has been going on for a long time it is as well to focus public attention on the simple things which will appear to the public as most objectionable before going into those of a more technical nature.
    8.0 p.m.
    Mr. Jenkins: Is the hon. Member now suggesting that common pricing is much more complicated than, for example, aggregate rebates?
    Mr. Holt: A lot of the economic arguments in connection with it are a great deal more difficult to appreciate.
    It is quite apparent to many people, when they hear about what goes on in a secret court, that that kind of thing is thoroughly objectionable. It was the publicity that was given to the secret courts which influenced the public mind to support this kind of legislation. I have made my points on the Amendment, and I regret to say that, for the reasons I have given, my party is unable to support it.
    Mr. Jay: I am glad to learn that the hon. Member for Bolton. West (Mr. Holt) would be prepared to support our Amendment but for subsection (3). If his objection is that the laying of this work on the Court would hold up the rest of the Court's activities, that could be met by having a separate division of the Court or an arrangement by which that part of the work did not clash with the remainder of the work. We do not want things to work out in the way he suggested, and I hope that the hon. Member may be persuaded to support the Amendment after all, if that is his only objection.
    I was not convinced by the President's reply, vigorous though it was, to our proposals. He said, first, that we could not act by way of prohibition because of the extraordinary difficulty of defining the practices which were to be declared unlawful. I fully agree that it is difficult to get an effective definition but I am by no means convinced that it is impossible. The President and the Committee have achieved a definition of a group of restrictive agreements in Clause 5. It may well be that for the purpose of declaring the agreements unlawful, there must be an even more precise definition than we have for the purposes of registration. If, however, we have got as far as we have done already with Clause 5, I am encouraged to think that, if necessary, we could get an even more precise definition of what, after all, would be a more limited class of agreements.
    I would point out to the President that the Commission, in its Report, when it said that there must be a very precise definition, based that comment specifically on the proposal to make the agreements criminal offences. If they were not criminal offences the need to have
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    absolute precision might be a little less great.
    I would not quite agree with my hon. Friend the Member for Loughborough (Mr. Cronin) that we have achieved perfection in the Amendment as it stands, but the fact that we have got as near to it as we have done without the assistance of the professional draftsmen, who normally we know, are more skilled in these matters than anybody outside the official service, encourages us to think that, with that professional help, it ought to be possible to achieve a definition of this kind.
    Has the President of the Board of Trade considered the parallel of the Income Tax? A very large number of offences exist under the heading of Income Tax and some of them are criminal offences. I am sure that the President has looked at the Income Tax Act, 1952, which nobody would suggest is not complicated. Nevertheless, it solves the problem of definition.
    Secondly, the right hon. Gentleman said—and in this I could not follow him—that our procedure would be no more speedy than his. We are saying that the group of practices in question would be made unlawful by a certain date unless approval had been given to them before that time, whether prima facie or outright approval. Certainly, if we put forward this type of argument, we must propose that there would be a more speedy procedure than, for example, the complete judicial procedure which the right hon. Gentleman is putting forward. If we are to get the job done more quickly we must have a more speedy way of doing it.
    Thirdly, the President said—it was an extraordinary argument for him at this stage—that the objection to this way of tackling the matter was that it would stop only the methods of enforcement and would not get at the realities behind them. Of course, if we prevent these agreements on common prices or whatever they are from being enforced, we have successfully terminated them. If they can be enforced only in certain ways and we prevent those methods of enforcement, we shall have done what we want and shall have brought the agreements to an end.
    It was an extraordinary argument from the President because, as I pointed out, what he was objecting to was exactly

    485
    what he is doing in Clause 19 about collective resale price maintenance. He is not banning the reality; he is banning the methods of enforcement. The very argument used by the Parliamentary Secretary on Second Reading was that if we ban the methods of enforcement—the methods by which agreements are being enforced now, he said—we shall have achieved all that we wish to achieve. We are proposing precisely what the President is doing in Clause 19, but, we think, over the larger field.
    It seemed to me that the President proved too little in his earlier arguments and too much in his later arguments, because in the latter he tried to prove that what he proposes is either impossible or not desirable. Nor was I convinced by his use of the words "legalise" and "guillotine". He drew a picture of our "legalising" these agreements during a period when the Bill became law and then bringing down a guillotine after which they would become unlawful. Of course, they would be no more legalised after the passing of the Bill than they are now, and they would be no more "guillotined" in any revolutionary or catastrophic sense than collective resale price maintenance will be guillotined—without exception—under Clause 19 of the right hon. Gentleman's own Bill.
    It is very odd that the President, as my hon. Friend the Member for Stechford (Mr. Roy Jenkins) pointed out, should now say that it is no use dealing with frills and superficialities, such as methods of enforcement, but should tackle realities, when it is due entirely to his action over the last three years that we are in the position we are in now. We are selecting this group of methods of collective discrimination to be condemned outright because we are inevitably in the position that those are the practices which have been condemned by the Commission; and the Commission condemned them because the right hon. Gentleman referred them to the Commission for inquiry.
    First, therefore, the right hon. Gentleman selects these practices as being presumably the most important. I do not accept the unworthy idea that he has been playing politics with the whole business from beginning to end—that is going
    486
    too far. I believe that he thought these were important and, therefore, gave priority to them, and that the Commission agreed that they were important and condemned them; and yet the right hon. Gentleman now says they do not matter after all, that they are not the realities and that we should not worry about them. Even stranger than that, the President, in his speech, raised the issue of common prices, and said that that was the really wicked crime which we want to get at. Unless I am wrong, he made a reference also to the Commission about two years ago on the whole subject of common prices, on which the Commission has done some very hard, long and valuable work.
    Then the President, in order to introduce a Bill with, we think, a much more dilatory procedure, said to the Commission and told us on Second Reading that the whole of the inquiry was to be abandoned, and that what the Commission proposed on common prices was not to be implemented and, indeed, was not even to be known to the House or to the country.
    It is extraordinary that having first given the Commission the reference on collective discrimination, and having then given it a reference on common prices and stopped the latter in mid-passage, the President should now criticise us for wanting to go ahead in regard to collective discrimination on the ground that we are not doing anything about common prices. For these reasons I am still in favour of the Amendment.
    Mr P. Thorneycroft: We are indebted to the right hon. Member for Battersea, North (Mr. Jay) for having placed the Amendment on the Order Paper and initiating a debate which ought to have taken place on this stage of the Bill, in which some quite tolerable debating points have been made on both sides of the Committee. One of the first points was raised by the hon. Member for Huddersfield, West (Mr. Wade) about how long all this is going to take. Leaving aside any difference of method between us, all of us have a certain amount of anxiety about that.
    The hon. Member made one or two constructive suggestions on how we should deal with that point. He suggested that the matter might be dealt

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    with summarily on pleadings without the parties being heard, but that would raise difficulties. We have to carry the public with us in cases of this kind, and it is rather foreign to our system that someone should be condemned unheard just on his pleadings.
    Mr. Wade: It would be a question only of whether, after the specified period, the parties to the agreement would be allowed to continue to operate it pending a hearing.
    Mr. Thorneycroft: I appreciate that.
    We have included in the Bill certain provisions for summarily dealing with arrangements which appear to fall within some common principles, and it may be that we can make some progress on that type of agreement. But I do not think that it will be possible, in the last resort—and I do not think that it ought to be possible—to rule out the right of a man to have a hearing of a case in which he feels positively he is serving the public interest.
    The hon. Member for Loughborough (Mr. Cronin) and a number of other hon. Members said that everyone indulging in a restrictive practice should know quite clearly whether the practice is banned or not. The right hon. Member for Battersea, North has just been saying the same thing. That is true, but it is not quite true to say that there is less need for definition if we do not technically call it a criminal offence. We must define it. I am sure that I carry the hon. Member with me. If we are to say to groups of people who sincerely believe that they are serving the public interest that they must stop something, then the least we ought to do is to tell them what it is they have to stop.
    I do not believe that hon. and right hon. Members opposite have really faced the problem of definition here. An hon. Member opposite has been very complimentary to us about the progress which we have made in Clauses 5 and 6, and the skill and precision with which we have defined just what was within and without the rules of legislation. As a Committee, we can be very proud of ourselves, but looking back on those discussions I would not say that we have reached absolute perfection in that sphere at present. I would not say that
    488
    a little redrafting would not be necessary there on Report. The design there was, after all, to cover only what was registrable but when we come to what precisely must be stopped we are facing rather greater difficulty in definition.
    The question of these 18 months has been raised, and I agree very much with the hon. Member for Hillsborough (Mr. G. Darling), who said that we were all in the dark on the subject. Nobody knows, until we have seen the register, how many of these things will be registered. Many feel that there will be a substantial number, but until we know that number it is a little unreal to start inserting figures like 18 months into any Amendment or into the Bill.
    8.15 p.m.
    Despite everything that hon. and right hon. Members opposite have said, I frankly do not accept the account which they are seeking to give that at the end of 18 months all the agreements that do not happen to have had the luck to have had a hearing will be cast out. I know hon. and right hon. Gentlemen opposite too well: they will not do anything as unfair as that. Hon. Members have talked about gambling. Premium Bonds will be a certainty compared with the gamble here as to where one appears on the list and whether one has the luck to jostle one's way up the queue and be heard within 18 months or not. Therefore, I do not accept that argument.
    I know perfectly well that hon. and right hon. Members opposite will give people the opportunity to be heard during the 18 months, and that if somebody had not been heard during that period the right hon. Member for Battersea, North, with his innate sense of fairness, would arrange that the time should be extended periodically so that a hearing would take place. Therefore hon. and right hon. Members opposite would be in precisely the same difficulty as I am in that neither they nor I know how long all this would take.
    The hon. Member for Stechford (Mr. Roy Jenkins) made a shrewd debating point. He took the case of retail price maintenance. I do not want to anticipate our debate on that, but the difference is clear. In the case of retail price maintenance I have not sought to outlaw the basic arrangement, the individual right of a manufacturer to maintain his prices. I

    489
    have not outlawed that, because I think that that right ought to be preserved. We can debate that when we come to it. I have suggested that we should outlaw the methods of enforcement, for reasons which I shall argue when we reach the Clause. I believe I shall be able to adduce support from a number of Reports, such as those of the Lloyd Jacob Committee and the Monopolies Commission, for the consideration of the Committee when we come to that subject.
    However, that puts the matter in a rather different category compared with what we are now discussing, because here no one is saying that common prices, as a matter of principle, should continue. There is no doubt whatever that the putting forward of these other matters of enforcement in front of the common price arrangements is in a sense putting the cart before the horse. That is why I think the hon. Member for Stechford was on a shrewder debating point when he turned that argument against me and asked what I was doing in referring collective discrimination to the Monopolies Commission before common prices. If I may say so, that is a rather good point. If a Minister can be allowed to admit it, I am to some extent vulnerable upon it. I did not do it because it would make amusing reading for the public—though I am grateful for that defence which was offered to me.
    At the time that I made that reference—and it was some years ago—we all had less experience of these matters. There had been a number of Reports from the Monopolies Commission, all
    dealing with these particular groups of practices, and under the 1948 Act we require a group of Reports of that kind before we make a reference. Strangely enough, there was not a group of Reports on common prices at all at that time. Whether I was right or wrong I do not know. I admit frankly that it is arguable that I was wrong, but I am not sorry that I made the reference. I think that it was a useful one and that, whether we agree with the Report or not, without that reference we should not be looking at this legislation today. It was no doubt the public inspiration and interest which centred on that Report which made possible the introduction of a Bill of this kind.
    I have, I think, dealt with most of the points. I recognise there is an honest difference between both sides of the Committee, and there are arguable points which can be made in favour of many schemes to deal with practices of this sort. My own view is that the Amendment does not fully face the difficulties of definition, which I think are very real, and that under any arrangement the length of time will be a substantial problem. Whether I was right or wrong in my order of references to the Monopolies Commission, I am anxious to be right now, and to try to treat all these matters—common prices and methods of enforcement—grouped together in the best order of priority that we can devise.
    Question put, That those words be there inserted:—
    The Committee divided: Ayes 177, Noes 217.

    Division No. 163.]

    AYES

    [8.20 p.m.

    Ainsley, J. W.

    Champion, A. J.

    Evans, Stanley (Wednesbury)

    Allaun, Frank (Salford, E.)

    Chapman, W. D.

    Fernyhough, E.

    Allen, Arthur (Bosworth)

    Clunie, J.

    Fienburgh, W.

    Allen, Scholefield (Crewe)

    Coldrick, W.

    Forman, J. C.

    Awbery, S. S.

    Collick, P. H. (Birkenhead)

    Fraser, Thomas (Hamilton)

    Bacon, Miss Alice

    Collins, V. J. (Shoreditch & Finsbury)

    Gibson, C. W.

    Bence, C. R. (Dunbartonshire)

    Corbet, Mrs. Freda

    Gooch, E. G.

    Benn, Hn. Wedgwood (Bristol, S.E.)

    Cove, W. G.

    Grenfell, Rt. Hon. D. R.

    Benson, G.

    Craddock, George (Bradford, S.)

    Grey, C. F.

    Beswick, F.

    Cronin, J. D.

    Griffiths, David (Rother Valley)

    Blackburn, P.

    Crossman, R. H. S.

    Griffiths, Rt. Hon. James (Llanelly)

    Blenkinsop, A.

    Cullen, Mrs. A.

    Hale, Leslie

    Blyton, W. R.

    Dalton, Rt. Hon. H.

    Hamilton, W. W.

    Bottomley, Rt. Hon. A. G.

    Darling, George (Hillsborough)

    Hannan, W.

    Bowden, H. W. (Leicester, S.W.)

    Davies, Stephen (Merthyr)

    Hastings, S.

    Bowles, F. G.

    Deer, G.

    Hayman, F. H.

    Boyd, T. C.

    Delargy, H. J.

    Henderson, Rt. Hn. A. (Rwly Regis)

    Brockway, A. F.

    Dodds, N. N.

    Herbison, Miss M.

    Broughton, Dr. A. D. D.

    Donnelly. D. L.

    Hobson, C. R.

    Brown, Thomas (Ince)

    Dugdale, Rt. Hn. John (W. Brmwch)

    Houghton, Douglas

    Burton, Miss F. E.

    Edelman, M.

    Howell, Denis (All Saints)

    Butler, Herbert (Hackney, C.)

    Edwards, Rt. Hon. John (Brighouse)

    Hubbard, T. F.

    Butler, Mrs. Joyce (Wood Green)

    Edwards, Rt. Hon. Ness (Caerphilly)

    Hughes, Hector (Aberdeen, N.)

    Castle, Mrs. B. A.

    Edwards, Robert (Bilston)

    Hunter, A. E.

    Irvine, A. J. (Edge Hill)

    Morris, Percy (Swansea, W.)

    Slater, Mrs. H. (Stoke, N.)

    Irving, S. (Dartford)

    Morrison, Rt. Hn. Herbert (Lewis'm, S.)

    Smith, Ellis (Stoke, S.)

    Jay, Rt. Hon. D. P. T.

    Mort, D. L.

    Sorensen, R. W.

    Jenkins, Roy (Stechford)

    Moss, R.

    Steele, T.

    Johnson, James (Rugby)

    Moyle, A.

    Stewart, Michael (Fulham)

    Jones, David (The Hartlepools)

    Mulley, F. W.

    Stones, W. (Consett)

    Jones, Jack (Rotherham)

    Neal, Harold (Bolsover)

    Stross, Dr. Barnett (Stoke-on-Trent, C.)

    Jones, J. Idwal (Wrexham)

    Noel-Baker, Francis (Swindon)

    Summerskill, Rt. Hon. E.

    Jones, T. W. (Merioneth)

    Oliver, G. H.

    Sylvester, G. O.

    Key, Rt. Hon. C. W.

    Oram, A. E.

    Taylor, Bernard (Mansfield)

    King, Dr. H. M.

    Orbach, M.

    Taylor, John (West Lothian)

    Lawson, C. M.

    Oswald, T.

    Thomson, George (Dundee, E.)

    Ledger, R. J.

    Owen, W. J.

    Timmons, J,

    Lee, Frederick (Newton)

    Paling, Rt. Hon. W. (Dearne Valley)

    Tomney, F.

    Lee, Miss Jennie (Cannock)

    Paling, Will T. (Dewsbury)

    Turner-Samuels, M.

    Lever, Leslie (Ardwick)

    Palmer, A. M. F.

    Ungoed-Thomas, Sir Lynn

    Lewis, Arthur

    Parker, J.

    Warbey, W. N.

    Logan, D. G.

    Parkin, B. T.

    Weitzman, D.

    Mabon, Dr. J. Dickson

    Paton, J.

    Wells, Percy (Faversham)

    McGhee, H. G.

    Pearson, A.

    Wells, William (Walsall, N.)

    McGovern, J,

    Plummer, Sir Leslie

    West, D. G.

    McInnes, J.

    Popplewell, E.

    Wheeldon, W. E.

    McKay, John (Wallsend)

    Probert, A. R.

    White, Henry (Derbyshire, N.E.)

    McLeavy, Frank

    Proctor, W. T.

    Wilkins, W. A.

    MacMillan, M. K. (Western Isles)

    Pryde, D. J.

    Willey, Frederick

    MacPherson, Malcolm (Stirling)

    Randall, H. E.

    Williams, Rev. Llyewelyn (Ab'tillery)

    Mahon, Simon

    Redhead, E. C.

    Williams, W. R. (Openshaw)

    Mallalieu, E. L. (Brigg)

    Reeves, J.

    Willis, Eustace (Edinburgh, E.)

    Mallalieu, J. P. W. (Huddersfd, E.)

    Reid, William

    Wilson, Rt. Hon. Harold (Huyton)

    Mason, Roy

    Roberts, Albert (Normanton)

    Winterbottom, Richard

    Mayhew, C. P.

    Roberts, Goronwy (Caernarvon)

    Woodburn, Rt. Hon. A.

    Messer, Sir F.

    Robinson, Kenneth (St. Pancras, N.)

    Woof, R. E.

    Mikardo, Ian

    Ross, William

    Zilliacus, K.

    Mitchison, G. R.

    Royle, C.

    Monslow, W.

    Silverman, Julius (Aston)

    TELLERS FOR THE AYES:

    Moody, A. S.

    Skeffington, A. M.

    Mr. J. T. Price and Mr. Short.

    NOES

    Agnew, Cmdr. P. G.

    Donaldson, Cmdr. C. E. McA.

    Hurd, A. R.

    Aitken, W. T.

    Doughty, C. J. A.

    Hutchison, Sir Ian Clark (E'b'gh, W.)

    Allan, R. A. (Paddington, S.)

    Drayson, G. B.

    Hutchison, Sir James (Scotstoun)

    Amery, Julian (Preston, N.)

    du Cann, E. D. L.

    Iremonger, T. L.

    Arbuthnot, John

    Duncan, Capt. J. A. L.

    Irvine, Bryant Godman (Rye)

    Armstrong, C. W.

    Duthie, W. S.

    Jenkins, Robert (Dulwich)

    Ashton, H.

    Eden, J. B. (Bournemouth, West)

    Johnson, Dr. Donald (Carlisle)

    Baldock, Lt.-Cmdr. J. M.

    Emmet, Hon. Mrs. Evelyn

    Johnson, Eric (Blackley)

    Baldwin, A. E.

    Errington, Sir Eric

    Jones, Rt. Hon. Aubrey (Hail Green)

    Balniel, Lord

    Farey-Jones, F. W.

    Joseph, Sir Keith

    Barlow, Sir John

    Finlay, Graeme

    Joynson-Hicks, Hon. Sir Lancelot

    Barter, John

    Fisher, Nigel

    Kaberry, D.

    Bell, Philip (Bolton, E.)

    Fleetwood-Hesketh, R. F.

    Keegan, D.

    Bell, Ronald (Bucks, S.)

    Fletcher-Cooke, C.

    Kerr, H. W.

    Bennett, Dr. Reginald

    Fraser, Hon. Hugh (Stone)

    Kershaw, J. A.

    Bevins, J. R. (Toxteth)

    George, J. C. (Pollok)

    Kimball, M.

    Biggs-Davidson, J. A.

    Gibson-Watt, D.

    Kirk, P. M.

    Bishop, F. P.

    Glover, D.

    Lagden, G. W.

    Body, R. F.

    Gomme-Duncan, Col. Sir Alan

    Leather, E. H. C.

    Bowen, E. R. (Cardigan)

    Gower, H. R.

    Leavey, J. A.

    Boyle, Sir Edward

    Grant, W. (Woodside)

    Leburn, W. G.

    Braine, B. R.

    Green, A.

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

    Braithwaite, Sir Albert (Harrow, W.)

    Gresham Cooke, R.

    Legh, Hon. Peter (Petersfield)

    Brooke, Rt. Hon. Henry

    Grimond, J.

    Lindsay, Hon. James (Devon, N.)

    Brooman-White, R. C.

    Grimston, Hon. John (St, Albans)

    Linstead, Sir H. N.

    Bryan, P.

    Grimston, Sir Robert (Westbury)

    Lloyd, Maj. Sir Guy (Renfrew, E.)

    Burden, F. F. A.

    Grosvenor, Lt.-Col. R. G.

    Longden, Gilbert

    Butcher, Sir Herbert

    Gurden, Harold

    Lucas, Sir Jocelyn (Portsmouth, S.)

    Campbell, Sir David

    Hall, John (Wycombe)

    Lucas, P. B. (Brentford & Chiswick)

    Carr, Robert

    Harris, Frederic (Croydon, N.W.)

    Lucas-Tooth, Sir Hugh

    Cary, Sir Robert

    Harris, Reader (Heston)

    Macdonald, Sir Peter

    Chichester-Clark, R.

    Harrison, A. B. C. (Maldon)

    McKibbin, A. J.

    Clarke, Brig. Terence (Portsmth, W.)

    Harrison, Col. J. H. (Eye)

    Mackie, J, H. (Calloway)

    Cole, Norman

    Harvey, Air Cdre. A. V. (Macclesfd)

    McLaughlin, Mrs. P.

    Cordeaux, Lt.-Col. J. K.

    Harvey, Ian (Harrow, E.)

    Maclean, Fitzroy (Lancaster)

    Corfield, Capt. F. V.

    Harvey, John (Walthamstow, E.)

    McLean, Neil (Inverness)

    Craddock, Beresford (Spelthorne)

    Heald, Rt. Hon. Sir Lionel

    MacLeod, John (Ross & Cromarty)

    Crosthwaite-Eyre, Col. O. E.

    Heath, Rt. Hon. E. R. G.

    Macpherson, Niall (Dumfries)

    Crowder, Sir John (Finchley)

    Hinchingbrooke, Viscount

    Maddan, Martin

    Crowder, Petre (Ruislip—Northwood)

    Holt, A. F.

    Manningham-Buller, Rt. Hn. Sir R.

    Cunningham, Knox

    Hornsby-Smith, Miss M. P.

    Markham, Major Sir Frank

    Currie, C. B. H.

    Horobin, Sir Ian

    Marlowe, A. A. H.

    Dance, J. C. G.

    Howard, John (Test)

    Marshall, Douglas

    D'Avigdor-Goldsmid, Sir Henry

    Hudson, Sir Austin (Lewisham, N.)

    Mathew, R.

    Deedes, W. F.

    Hudson, W. R. A. (Hull, N.)

    Maude, Angus

    492

    493

    Mawby, R. L.

    Redmayne, M.

    Taylor, William (Bradford, N.)

    Maydon, Lt.-Comdr. S. L. C.

    Rees-Davies, W. R.

    Thompson, Kenneth (Walton)

    Milligan, Rt. Hon. W. B.

    Remnant, Hon. P.

    Thompson, Lt.-Cdr. R. (Croydon, S.)

    Moore, Sir Thomas

    Renton, D. L. M.

    Thorneycroft, Rt. Hon. P.

    Morrison, John (Salisbury)

    Ridsdale, J. E.

    Tilney, John (Wavertree)

    Mott-Radclyffe, C. E.

    Rippon, A. G. F.

    Touche, Sir Gordon

    Nairn, D. L. S.

    Roberts, Sir Peter (Heeley)

    Turner, H. F. L.

    Neave, Airey

    Robertson, Sir David

    Tweedsmuir, Lady

    Nicholson, Godfrey (Farnham)

    Roper, Sir Harold

    Vane, W. M. F.

    Nicolson, N. (B'n'm'th, E. & Chr'ch)

    Ropner, Col. Sir Leonard

    Vaughan-Morgan, J. K.

    Nield, Basil (Chester)

    Russell, R. S.

    Vickers, Miss J. H.

    Oakshott, H. D.

    Schofield, Lt.-Col. W.

    Wade, D. W.

    O'Neill, Hn. Phelim (Co. Antrim, N.)

    Scott-Miller, Cmdr. R.

    Wakefield, Edward (Derbyshire, W.)

    Ormsby-Gore, Hon. W. D.

    Sharpies, R. C.

    Wakefield, Sir Wavell (St. M'lebone)

    Orr, Capt. L. P. S.

    Shepherd, William

    Walker-Smith, D. C.

    Osborne, C.

    Simon, J. E. S. (Middlesbrough, W.)

    Wall, Major Patrick

    Page, R. G.

    Smithers, Peter (Winchester)

    Ward, Hon. George (Worcester)

    Pannell, N. A. (Kirkdale)

    Smyth, Brig. Sir John (Norwood)

    Ward, Dame Irene (Tynemouth)

    Partridge, E.

    Spearman, A. C. M.

    Waterhouse, Capt. Rt. Hon. C.

    Pickthorn, K. W. M.

    Speir, R. M.

    Webbe, Sir H.

    Pilkingon, Capt. R. A.

    Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)

    Whitelaw, W. S. I.(Penrith & Border)

    Pitt, Miss E. M.

    Stanley, Capt. Hon. Richard

    Williams, Paul (Sunderland, S.)

    Pott, H. P.

    Stevens, Geoffrey

    Wills, G. (Bridgwater)

    Powell, J. Enoch

    Steward, Harold (Stockport, S.)

    Wilson, Geoffrey (Truro)

    Profumo, J. D.

    Stewart, Henderson (Fife, E.)

    Wood, Hon. R.

    Raikes, Sir Victor

    Stoddart-Scott, Col. M.

    Woollam, John Victor

    Ramsden, J. E.

    Studholme, H. G.

    Rawlinson, Peter

    Summers, G. S. (Aylesbury)

    TELLERS FOR THE NOES:

    Mr. Godber and Mr. Hughes-Young.

    8.30 p.m.
    Sir L. Joynson-Hicks: I beg to move, in page 13, line 12, after "Act" to insert:
    "or on the application of any of the parties thereto".
    The purport of this Amendment is to enable a party to the agreement also to have the right of application to the Court. At present, only the Registrar can apply to the Court in the first instance. The Amendment would make the Clause read:
    "The Court shall have jurisdiction on the application of the Registrar in respect of any agreement…or on the application of any of the parties thereto … "
    This is not a very wide provision, but it is rather important. The basic object of the Amendment is to try to bring into the Bill what many of us have been attempting to do from its Second Reading onwards, that is, the appearance and the recognition that the Court is a fair court and not a criminal court. We want to get away from the idea that the parties are being dragged to the Old Bailey; nobody ever voluntarily applies to the Old Bailey in the first instance but, as parties, they apply to the High Court so that they can ascertain their rights and obtain an order for the enforcement of their rights.
    I see no reason why a party to an agreement should not equally be entitled to apply to the Court for the ascertainment of his rights and for the enforcement of his rights in the cases under consideration in the Bill. The possibility is cer-
    494
    tainly recognised in subsequent aspects of the procedure, because if there is need for rectification the parties to the agreement then have the right to apply to the Court. So there is nothing particularly novel in my proposal except the insertion of it in this place. I believe that it will be welcome and it will not be difficult.
    I have not the slightest doubt that the answer will be, first, that it might interrupt the administrative nicety with which agreements are brought before the Court. One can visualise the Registrar, with that efficiency which I am sure his staff will enjoy, producing a series of lists of existing agreements tabulated in the order in which they will come before the Court. If he does that, it will upset his routine considerably if a party to the agreement says, "I want my agreement to come before the Court and I shall apply to the Court for its consideration."
    I do not think that the nice convenience exercised by the Registrar—which, I agree, would be to the benefit of the majority of parties to the agreement—should be a paramount consideration that should override the right of a party to apply to the Court to obtain justice. One can easily visualise circumstances in which a party deems it desirable, and even necessary, to apply to the Court, and not only in cases in which he may have an agreement which is similar to others that have already been adjudicated upon.
    Those, I appreciate, can be dealt with under the summary procedure contained in a subsequent Clause. Under that summary procedure the Registrar can make

    495
    application to deal with many of these analogous cases expeditiously, so I have no doubt that will meet that point. My point is one which I am sure the Government cannot refrain from granting, because it was made before this Committee by my right hon. Friend the President of the Board of Trade only yesterday.
    I would remind my hon. and learned Friend of what the President said yesterday, on Clause 6:
    "… I would ask the Committee to remember that an industry itself may sometimes wish a case to come forward, especially in respect of an agreement which has previously been disapproved. It may even wish to do so in other cases. From time to time, especially when some of the earlier decisions of the court have established a line of precedents, an industry may wish to be cleared in respect of a certain agreement and have a certainty introduced into the matter."—[OFFICIAL REPORT, 1st May, 1956; Vol. 552, c. 256.]
    I have quoted that because I could not have put it so well. Indeed, I should not expect to be able to do so.
    Who is to bring the matter forward? Is it the industry? No pressure can be put upon the Registrar—at all events, I hope not—for him to juggle about with the list of cases to be brought before the Court. It seems to be a matter which can only be dealt with by the parties to the agreement in the industry concerned. I have no doubt that if they sought to make a frivolous application to the Court, the Court would know very well indeed how to deal with it, and I am sure that no second frivolous application would be made. However, none of these considerations is sufficient to deny a party to the agreement the right of applying to the Court.
    Sir L. Ungoed-Thomas: I hope that the Parliamentary Secretary will not accept the Amendment. The hon. Member for Chichester (Sir L. Joynson-Hicks) said that if there were any frivolous applications, they would be very summarily dealt with. I assume that there would be no frivolous applications. It is difficult to see how there could be any. The applications of those who have the right to have their cases considered would, I imagine, not be frivolous.
    Whether an application was frivolous or not could not be decided without the Court going some way into the merits
    496
    of the matter. Therefore, the hon. Member is not reducing the number of applications that may be made by seeking to exclude frivolous ones. I imagine that every agreement would be one which could rightly be brought before the Court for its consideration. Quite apart from that, the Amendment suggests giving the parties to the agreement as much right as the Registrar himself would have to bring a matter before the Court. Consequently, from the point of view of the operation of the Amendment, what the hon. Gentleman has said about frivolous applications can be disregarded in considering the reasons which he put forward for supporting his Amendment.
    The hon. Gentleman said that his motive in advancing his proposal—I quite understand it—was that he wanted to make it clear that here was a fair Court, accessible to all parties. It does not affect the fairness of the Court in the least that one party can bring forward matters for consideration and another party cannot. That has nothing to do with it. The operation of the Court would be immaculate; there is a High Court judge there, and it would be perfectly fair.
    I am sure that the hon. Member was addressing himself not so much to the operations within the four corners of the Court as to the operation of the Clause and the procedure for bringing matters before the Court. In dealing with the procedure in bringing it before the Court, the hon. Gentleman made delightful play of the meticulous behaviour of the Registrar who would be drawing up delightful lists in the pigeon-holes of his office—all very pretty—but let us consider the realities of it for a moment.
    These agreements are agreements which would be valid until they are declared invalid. No difficulty, on that account, is imposed on the parties to the agreement except, as he said quite rightly, the possibility of uncertainty that may arise. One of the great arguments put forward on behalf of the President during the whole of this Bill—and it has been reiterated time and again—has been over the particular method he has adopted in the Bill. The Registrar will have the control subject to the direction of the President of the Board of Trade about the order in which these matters are, first, to be registered and then about the way in

    497
    which they are to be brought before the Court.
    Once one grants his method of dealing with the contracts, namely, that they are to be valid until they are declared invalid by the Court—I would make it clear that we are opposed to that approach—and once that approach is laid down and it is established that they have these powers, as we decided on previous Clauses, and we have to approach this Clause on the footing, already embodied in the Bill, that the President has a discretion in relation to the procedure for dealing with the cases by ordering the Registrar to bring them forward in the due course of administration. It would be quite chaotic, within the scheme which the President has brought forward, to allow any party to the agreement to raise any of these matters before the Court and to have the matter adjudicated upon.
    The residual hardship faced by the party to the agreement—and I do not want to run away from this; I want squarely to face the case which the right hon. Gentleman presented so persuasively—is that in case of uncertainty it may be desirable in his interests that the matter should be brought before the Court. I concede at once that that may arise. Against that one has to face the fact that the agreement is not invalid until it has been declared invalid by the Court. Therefore, he is not prejudiced about the validity of the agreement in any way by reason of his not being able to bring it forward.
    If the power which the hon. Gentleman wants in his Amendment is granted, it means that the whole scheme brought forward by the President, as an essential part of the presentation of his scheme before the Committee, is made quite chaotic. It is quite inconsistent with the approach of the President to this Bill to allow the power which the hon. Gentleman wants in his Amendment, and I hope that the Parliamentary Secretary will reject it.
    Mr. Walker-Smith: My hon. Friend the Member for Chichester (Sir L. Joynson-Hicks) has moved his Amendment in persuasive and felicitous terms, and I have sympathy with the object which he has in view and with the considerations which animated his approach to it. I would say straight away that there is no
    498
    question but that that this is a fair Court. The parties are not being dragged to it as to the Old Bailey, to use the words which he employed. If there are at this stage still apprehensions in industry or elsewhere outside on this score, I hope that it will take reassurance from what I say tonight that, as has been confirmed by the hon. and learned Gentleman the Member for Leicester, North-East (Sir L. Ungoed-Thomas), this will be a fair Court with fair and judicial proceedings, and that it will be a civil court.
    My hon. Friend suggested that administrative niceties might stand in the way of accepting his Amendment. I ask him to believe that it is not just a question of administrative niceties. These no doubt we could overcome without difficulty or jettison them, if need be, in favour of a greater benefit. It is a good deal more than that, because the effect of accepting this Amendment would, although that is not the intention, as I quite appreciate, be disruptive of the general structure upon which this is necessarily based.
    8.45 p.m.
    As the Bill stands, it is for the Registrar to bring the proceedings before the Court. Were the Amendment of my hon. Friend accepted, it would be possible for any of the parties to the agreement to make the application. Not just all the parties to the agreement, but any of the parties. Suppose, for example, one of the parties wished to bring the case before the Court, and the others did not. Straight away, there would be a very difficult problem for the Court. There are also other problems and I find it very difficult to see on what basis the Court could come to a decision about these applications.
    In the normal case, when parties are ready for trial the case is set down for trial and comes up in the list in the ordinary way. But suppose applications were made to vary the order in which the Registrar wished to present the cases to the Court. What would be the criteria by which the Court would be guided? How, for example, would the Court know what weight to give to the wishes of the individual applicants against the more general considerations which the Registrar would have in mind and of which the Court would not necessarily be apprised?
    In the Bill we are seeking to bring before the Court at the first possible

    499
    moment the most important cases which are ready for trial, and also those cases which could build up a body of case law and act as precedents and guidance in subsequent cases; and thereby facilitate the operation of Clause 18, to which my hon. Friend referred, which specifically provides for machinery for dealing with cases quickly where they come within the framework of cases already decided.
    My hon. Friend, quite legitimately and properly, quoted what was said yesterday by my right hon. Friend, and which appears in column 256 of the OFFICIAL REPORT. But I must remind him and the Committee of the context in which my right hon. Friend was speaking. He was replying to the proposal that certain agreements should be taken out of the obligation to register under Part I of the Bill at all. He was addressing himself to quite a different proposition from that with which we are faced today. The example he gave of the parties wishing to accelerate the hearing was primarily a case where some of the earlier decisions of the court had established a line of precedents; in other words, the operation of Clause 18.
    In those circumstances, while I am sympathetic to what my hon. Friend said about parties being able to get a hearing as soon as possible, I think the Committee will appreciate that to accept this Amendment would create difficulties in the system, as it is envisaged in this Bill, disproportionate to the benefit which would accrue. For the reassurance of my hon. Friend I would say that it will be open to parties to make representations to the Registrar in the proper way as to the order in which cases should be taken. I am satisfied that, in practice, we shall not encounter the difficulties which may be apprehended from what he has said. I hope that that will bring a measure of reassurance to my hon. Friend, and that in those circumstances he will not feel it necessary to press the Amendment.
    Sir L. Joynson-Hicks: For the sake of the record, may I make it clear, as my hon. and learned Friend the Parliamentary Secretary and the hon. and learned Member for Leicester, North-East (Sir L. Ungoed-Thomas) will appreciate, that I was not casting any aspersions on the
    500
    fairness of the Court? What I was trying to do, and what I have been trying to do throughout the consideration of the Bill, was to introduce into the Bill something which will show the public and industry as a whole that the Court can be seen to be fair, as well as our knowing it to be fair.
    I appreciated that I should meet with certain difficulties in my proposal. I still feel that it is a great pity that the parties to the agreement must be excluded from the right of initial approach to the Court, but we have something in the assurance which my hon. and learned Friend has given, that they have the right to approach the Registrar, particularly in regard to the order of applications to the Court. With that I will be content for the time being. I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. Fienburgh: I beg to move, in page 13, line 14, after "agreement" to insert:
    "or any method of enforcing such restrictions".
    The Parliamentary Secretary, who is now with us for the night shift, the day shift having gone for its dinner, will realise, from a more than passing acquaintanceship with the Bill, that the Clause restricts the jurisdiction of the Court to matters involving the restrictions which are brought before it. The Restrictive Practices Court can, therefore, say on any restriction brought before it, "This restriction is against the public interest". The converse is also true and it can rule that a restriction brought before it is in the public interest, or, to put it on a lower plane, not against the public interest, and that therefore the restriction as such may continue to be operated.
    There is open to the Court a wide variety of reasons for giving a ruling that a restriction may continue in operation. There are some people who would suggest that the variety of reasons available for the continuation of restrictions is so widely drawn that it is possible to drive a coach and horses through the Bill. There are others who suggest that that view is entirely wrong and that it is possible, so widely drawn is the subsequent Clause, to drive the entire rolling stock of British Railways through it at one point or another.

    501
    Let us for a moment consider some of the lines upon which a restriction may, by ruling of the Restrictive Practices Court, continue in operation. One example is when a restriction operates to the general safety of the public in regard to the purchase, consumption and installation of goods which require the application of skill. A second reason is if the ending of an agreement would deprive the public of certain benefits which flow from that agreement. A third is that the restriction is part of a defence mechanism operated by agreement among a group of people to defend themselves against the application of other restrictive practices applied by other people.
    A restriction may be maintained by order of the Court if it is used to establish a firm bargaining base from which a group of people can effectively bargain with, say, a monopolistic supplier. It can be maintained in operation as a restriction if it is part of some form of rationalisation of industrial schemes as laid down in previous Statutes. It can be continued as a restriction by order of the Court, if, in the view of the Court, its removal would have an adverse effect on the level of employment in a particular area.
    Of course, as we go on to subsequent Clauses, we shall be offered various other Amendments from the other side of the Committee which will add further reasons, further excuses, for permitting the Restrictive Practices Court to grant the continuance of a restriction which has been brought before it. It is fair to say, to put it at its lowest, that there will be many restrictions which fall within the scope of the Bill which will go before the Restrictive Practices Court and then be adjudged as not being contrary to the public interest for many of the reasons stated and may therefore continue to be in operation.
    There always have been, in the public attitude to the whole question of monopoly, two points of condemnation. The first point was the existence of the monopolistic practices themselves. I am sure that in the public eye the economic significance of this was never so pronounced as the second point of condemnation, which was condemnation of the methods whereby the restrictive practices were enforced. I think that the public generally always felt more angry about the
    502
    existence of snoopers and private courts than it did about the basic monopolistic restrictive practices which lay behind them, and for the enforcement of which they were designed.
    Thus, we find ourselves at the moment with a Bill under which, as it is now drafted, it may be said by the Court that a restriction may continue in the public interest, but that Court has no power and no jurisdiction whatever over the methods whereby the permitted restrictive practice is to be enforced. I think we ought to bear in mind responsibly the public attitude to this, because, as I have said, it is not only the existence of a bad practice which the public resents, but it is also the—in some ways—even worse practice whereby the bad practice was originally enforced.
    Now, we shall find that, under the Clause, the Court will grant that a restriction may continue and the bad practices whereby it is continued, the bad practices which were so much in public evidence and which aroused so much public anger, can still be continued under this Bill. It may be argued that most of the wicked devices, such as the employment of snoopers and agents provocateurs and the use of the private court, flowed from collective resale price maintenance, and that it was really only in the enforcement of collective resale price maintenance that these various devices were used. If that were so, there would be no substance in our Amendment at all, because by categorically banning collective resale price maintenance, obviously the instrument whereby it was enforced would also fall, and there would be no argument about that at all.
    I assume that there are other restrictions than collective resale price maintenance in the support of which various unpleasant devices may still be used. Let us take the first example, to move from precept to example. It is possible for a restriction to be continued in operation if it affects the purchase or installation of equipment which demands skill, as laid down in Clause 16. Surely, it is possible for a case like this to arise when there is amongst manufacturers and installers of electrical equipment a restrictive agreement governing their members, and it is therefore possible that this agreement could be brought before the Court. It is also possible, and I think likely, that the

    503
    Court would agree that under the terms of Clause 16, it was a perfectly valid restriction and should continue. Therefore, the restriction would continue to operate under Clause 16.
    Now, let us assume that someone connected with the installation of this kind of machinery involving the use of skill and the protection of public safety and all the rest decides to break the agreement. How, in the first place, is it discovered that he has broken the agreement? There is the possibility here that the use of the snooper may arise.
    9.0 p.m.
    If it is discovered that the agreement has been broken, by what means is the association involved or the parties to the agreement to enforce it? Possibly by the use of a secret court. If they bring a man before a secret court, they do not do so just to tell him that he has been a very naughty boy and must not do it again. They intend to apply some sanction to him. The sanction may be a fine imposed by the secret court as a result of the operation of an informer or a snooper based upon a restriction which has been legalised by the Restrictive Practices Court.
    Take another example, this time an historical example. In the town of Jarrow in the 1930s, a consortium of steel makers desired to erect a steel works there. I see that the hon. and learned Member for Middlesbrough, West (Mr. Simon) is becoming interested. He did not clash with me on the facts, and I do not think that he will disagree with me now. The desire was to build a steel works, and one of the arguments put forward against the proposal by the steel industry at the time was that the building of a new steel works in Jarrow would have an adverse effect on employment levels in other areas of the country. As it would be a more modern steel works, it would take trade away from other areas.
    It is possible under the Bill for an agreement to be ratified by the Restrictive Practices Court if it is designed to maintain the level of employment in a particular area in the light of predictable and current circumstances. Therefore, the position could arise that a group of manufacturers, as in the Jarrow case, might say that their agreement, which
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    had the effect of preventing a works opening somewhere else, was perfectly valid because if that works were opened up it might destroy the level of employment in their own area.
    The method by which they prevent the other steel works opening, as happened in Jarrow, is to refuse to supply the works either with certain raw materials needed in its manufacturing processes or to refuse to provide it with the sheet and high tensile steel needed, in the first place, for building the works. Also, by international arrangements, they prevent the works from importing the sheet steel and other materials needed for building the plant. Therefore, under the provisions of the Bill, one can have a whole series of bad practices being continually applied under the sanction of the Restrictive Practices Court.
    Mr. J. E. S. Simon: If the hon. Gentleman was giving a hypothetical or fictional example for the sake of his argument, we are all prepared to accept it, but if it was supposed to be an historical account of whether the steel works should have been established at Jarrow or on Tees-side then it is very far from what happened.
    Mr. Fienburgh: We can argue about this ad infinitum, as the hon. and learned Gentleman and I argued during the Committee stage of the Iron and Steel Act. I think that on that occasion it ended up with honours being even and with the hon. and learned Gentleman saying that he would like to delete certain arguments from the OFFICIAL REPORT because, on second thoughts, he was not convinced of their validity.
    Mr. Simon: I do not remember that.
    Mr. Fienburgh: Therefore, the position in which we find ourselves is that in the Bill the Government are setting their faces against the continuation of the secret court, against the operation of the snooper and against the imposition of fines by the secret court in connection with collective resale price maintenance. In connection with individual resale price maintenance the Government are creating alternative methods whereby a manufacturer can enforce individual resale price maintenance. In the other field of restrictions which can still be validated by the Restrictive Practices Court the practices

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    to which the public object are still possible, and as I think I have shown by the examples I have quoted, can still be continued.
    This, of course, is only the old, old moral and ethical argument which has perturbed mankind through the ages—whether an end which is desirable justifies the means employed. It may be arguable that the end for which a particular restriction is designed is perfectly desirable. That is only one half of the argument. One half of the argument is to say that we wish to do a certain thing. The second half is to say whether the means which we seek to employ are worthy of that end or whether they debase that end. This is an argument which has been going on ever since man began to philosophise and to have ethical and moral qualms about anything.
    There are people who say that the war with the Japanese had to be ended quickly and smartly, and that the means employed, the dropping of an atom bomb, justified that end. I disagree, but there are others who take the opposite view. Others argue that it is better to try to protect small children by the institution of the National Society for the Prevention of Cruelty to Children—
    The Deputy-Chairman: I think that these illustrations are taking us over a very wide field.
    Mr. Fienburgh: A restricting Bill should surely not be employed, Sir Rhys, to restrict argument unduly. I am giving illustrations of the moral predicament in which the Government find themselves—and it is a moral predicament. They agree about certain things and are prepared to legislate for certain things, whereas the community at large objects to the employment of certain means. The end desired is the maintenance of certain restrictive practices for which there could be good motives; the means to which the public objects are those which I have discussed—the secret court, the snooper and informer, the fine by secret court and the operation of many bad practices of that nature in support of perfectly desirable ends.
    That is our argument, and that is why, by the Amendment, we seek to give to the Restrictive Practices Court jurisdiction not only over ends but over means, so that that Court can say to the parties who
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    come before it seeking the validation of a restrictive practice, "Yes, we accept that this restrictive practice, this restriction, is proper for any one of a half-dozen reasons laid down in the Bill, but we do not accept that the means by which you apply that restriction are proper, morally or ethically, in the light of public opinion or in the light of any reasonable consideration.
    Therefore, having accepted your restriction, we now ask you to go away and find more acceptable means of applying your restriction"—whether that be by contractual relationships between the parties which can be tested at civil law or by any other device—or whether, as I believe a subsequent Amendment suggests, the High Court should be brought in to deal with this problem as it is in the case of individual resale price maintenance. But that I am not prepared to discuss at this stage as it arises subsequently.
    I do not see how the Parliamentary Secretary can really resist the argument—which, I am sure, will be endorsed by many hon. Members opposite—that we are doing only half the job if we give the Restrictive Practices Court jurisdiction over the ends without giving it some moral and ethical jurisdiction over the means employed to sustain those ends.
    Mr. Walker-Smith: The hon. Member for Islington, North (Mr. Fienburgh) has moved his Amendment with eloquence and force, and has sought to make a clear distinction between the agreements which are made containing the restrictions, and the methods of enforcement. Indeed, I think the Committee will appreciate that the whole of his case rested upon the validity of the dichotomy he sought to establish.
    It is my submission to the Committee that an analysis of the provisions of the Bill shows that that dichotomy does not exist in the way that the hon. Member suggested. May I follow him in taking the analogy of Clause 19, which is the Clause under which collective enforcement of resale price maintenance is prohibited. The hon. Member was concerned that there might still be a power for fines, private courts, and so on, in respect of an agreement found by the Restrictive Practices Court not to be contrary to the public interest.
    If he will look carefully at Clause 19 he will see that there is not in the Clause

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    any express prohibition of the private Court or the fine in the case of resale price maintenance. Nevertheless, we are quite confident, as was said on Second Reading, that the provisions of Clause 19 will indirectly bring those methods of enforcement to an end in regard to resale price maintenance.
    Mr. Fienburgh: The hon. and learned Member was listening very carefully and, if he misunderstood, I am sure I must not have expressed myself very well, but I made the same point. I said that because we were banning the restriction of collective resale price maintenance, then, obviously, the means of enforcing it would wither away. But I added that where we are leaving a restriction alone, then, of course, nothing will wither away at all, whether it be a system of secret courts or snoopers or fines.
    Mr. Walker-Smith: If there is a misunderstanding I am sure that it is not due to any lack of lucidity on the hon. Member's part. I do not think there is any misunderstanding, as he will realise if he hears me to the end.
    Clause 19, as he agrees—so I understand—does not expressly make unlawful the private court or the fine. Nevertheless, we are satisfied that in the case of resale price maintenance the provisions of Clause 19 will, albeit indirectly, mean the end of those procedures in regard to resale price maintenance. The reason is this: the sanction behind enforcement and acceptance of fines is, of course, the sanction of the withholding of supplies if one does not bow down to the unofficial discipline imposed by those courts and by those fines. In the case of resale price maintenance, Clause 19 prohibits boycott and collective discrimination and thereby strikes away the only basis on which a system of fines and private courts can rest.
    It is quite true, as the hon. Member said and as the Committee knows, that there is not an analogous provision in Part I of the Bill doing away with collective enforcement in the shape of collective discrimination and boycott in restrictive agreements other than those of resale price maintenance. But, if I may respectfully say so, this is the flaw in the hon. Member's argument: the provision for collective discrimination or
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    boycott in an ordinary restrictive agreement—that is to say, other than resale price maintenance—is not something out-with the agreement which is registered and which comes under the jurisdiction of the court.
    On the contrary, it is one of the things which is specifically provided for among the matters which bring an agreement within the registrable provisions of Clause 5. It is the restriction specified in subsection (1, e) of Clause 5. It is the one which makes an agreement imposing a collective discrimination something which has to be registered and brought before the Court. That is why I say that there is not, in fact, a dichotomy between the agreement and the means of enforcing it, because the method of enforcing it is prescribed in the agreement itself, therefore it comes before the Court and the Court is able to adjudicate upon it.
    If the Court thinks that the restriction imposed by way of collective discrimination or boycott is contrary to the public interest, it will say so and prohibit it. If, on the other hand, there is no provision in the agreement for collective discrimination or boycott it cannot be effectively practised and, just as in the case of resale price maintenance, without that basis the superstructure of fines and private courts cannot stand.
    9.15 p.m.
    Under those circumstances and with that in mind, if we look back to the provisions of Clause 15, the Committee, I hope, will agree that there is a sufficiently wide power in the Court, because the Court can order that powers be provided for restraining the parties to the agreement, or any of them, from giving effect to or enforcing the agreement in respect of the restriction or making any agreement like it. It gives power, if the Court is satisfied that the agreement for collective discrimination or boycott in cases other than resale price maintenance, ought not to go on, to prohibit it and make an order so doing. Any party disobeying that order, or seeking to put the agreement and the procedures of collective discrimination or boycott into force would be acting in contempt of court by reason of disobeying that order. I think that that is a satisfactory provision and should work satisfactorily in practice.

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    I do not want to anticipate by going into the theme, mentioned, in passing, by the hon. Member towards the end of his speech, of the possibility of there being a contractual right of the parties to enforce these restrictive agreements. All I would say on that is, as the hon. Member and the Committee are well aware, that there is no such contractual right in our law as it is at present.
    Mr. Fienburgh: The hon. and learned Gentleman has arrived satisfactorily at his conclusion because, on the branch line, he has taken a certain course and set the signals at clear all the way to the conclusion he wished to reach.
    If we go back along the branch line of his arguments the other way, we find that under Clause 5 (1, e) an agreement has to be registered and, having been registered, can be brought to the Court under Clause 15. The Court has jurisdiction to do one of two things about that agreement. It can say that an agreement in terms of Clause 5, subsection (1, e) is a proper agreement, a proper restriction to continue and not to be ended as the hon. Gentleman suggested, but that it can continue because of the provisions of Clause 16.
    In other words, I am setting the signals the other way. Instead of the Court saying. "We do not like this agreement and do not think it is proper, therefore you cannot carry it on", I say it has every right—if not, why is this in the Bill at all?—to say that the agreement must be registered and must come before the Court and that the job of the Court is to say whether the agreement shall stop or go on.
    If it says that it shall go on, then, under subsection (1, e) there is power to have the restriction enforced. If it is enforced under a type of agreement we do not like, the Court has no right to say that the agreement may continue, but that other devices must be sought for maintaining it.
    Mr. Walker-Smith: The hon. Gentleman will appreciate that he accepts, as I understand it now, that the restrictive agreement in respect of the enforcement—that is, by way of collective discrimination or boycott—is provided for in Clause 5 (1, e), and, therefore, is examinable by the Court. If the Court approves that agreement for collective discrimination
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    and boycott, it will have approved it not only because it has got through one or other of the gateways, as they are called, in paragraphs (a) to (g) in Clause 16, but also because under the tailpiece they have been found not to be contrary to the public interest.
    Therefore, the Court has examined the impact of the agreement for collective discrimination, for what the hon. Member calls the enforcement part of it, and it has done so against the criterion of the public interest. On the hon. Member's hypothetical case, the Court has approved it. Therefore, one must assume that if the Court did approve such an agreement, it was something which in the public interest ought not to be stopped.
    If, on the other hand, the Court considers that it is contrary to the public interest that this collective discrimination should continue—if, that is to say, the Court interprets it in the particular case on the same lines as is provided for in the case of retail price maintenance by Clause 19—the Court will prohibit it and will do so quite successfully and definitely. That is the position.
    The hon. Member is apprehensive that the Court may be unduly tender on these things, because there is no contractual method of enforcing them.
    Mr. Fienburgh indicated dissent.
    Mr. Walker-Smith: I do not want to anticipate another debate but I should hardly think that the Court would have that consideration very much in mind, for the Court is there to say whether it is contrary to the public interest and not to suggest means of enforcing the agreements, even if it declares them not to be contrary to the public interest.
    Mr. E. Fletcher: The Parliamentary Secretary has not answered the point raised by my hon. Friend the Member for Islington, North (Mr. Fienburgh). He has fallen into this difficulty. He has told us what the Court can do if it finds an agreement contrary to the public interest or not contrary to the public interest. What he has not addressed his mind to is the likelihood that there might be all kinds of other cases. He has not exhausted all the possible cases that come before the Court.
    All we are dealing with is jurisdiction. We are anxious that the Clause should

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    have the widest possible jurisdiction. We do not want to restrict it. We do not want to confine the Court to the limited choice of saying either that an agreement is all right and can go on or that it must be scrapped, because it by no means follows that everything will fall neatly into one or other of these two categories.
    There may well be a whole series of agreements which might be acceptable and not contrary to the public interest if certain conditions in them were eliminated. In fact, towards the end of his earlier remarks the Parliamentary Secretary seemed to suggest that the Amendment was unnecessary. The first part of his speech was directed—I thought, quite unsuccessfully—to trying to demolish the arguments of my hon. Friend, and then towards the end he seemed to suggest that, after all, it did not very much matter, because under subsection (2) the Court could make orders giving effect to enforcing, or purporting to enforce, an agreement or making some other order.
    All we are trying to do is to make it clear beyond all possible doubt that the Court has the wide jurisdiction necessary to enable it to look at any agreement and to deal with it, and, if necessary, to deal with it in parts, and to say that it would be all right if such and such objectionable provision were eliminated. It may be that the President will tell us that the Court can do that anyhow, because of subsection (2). If that is the argument there can be no possible reason for resisting the Amendment.
    We think it necessary to make this matter clear, for this reason. As the Parliamentary Secretary realises, Clauses 19 and 20 deal with the limited subject of resale price maintenance. They fall under Part II of the Bill and are entirely outside the competence of this Restrictive Practices Court. As I understand, the Court will have no jurisdiction whatever to deal with any matter that falls to be dealt with under Part II of the Bill, because the jurisdiction of the Court is limited to what will happen under Part I.
    If, contrary to the provisions of Clause 19, which prohibits the collective enforcement of resale price maintenance, a person were to disobey, proceedings for the enforcement of that Clause will come
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    before the ordinary Court in the ordinary way, by injunction. Therefore, the Restrictive Practices Court will not be concerned with giving effect to Clause 19. But, as the latest Report of the Monopolies Commission shows, the collective enforcement of resale price maintenance is not the only evil which is enforced by collective action, whether by means of stop lists or by secret courts and so forth. There are other devices, not connected with resale price maintenance, such as exclusive dealing and limited markets and all kinds of things, equally capable of enforcement by collective measures, which ought to be stopped.
    The secret courts deal with a variety of other matters and, the Parliamentary Secretary realises, secret courts and stop lists are not in any way expressly banned by the Bill. The Parliamentary Secretary relies upon the indirect effect of Clause 19 to put an end to secret courts and stop lists in so far as collective resale price maintenance is concerned, but we are anxious to put an end to secret courts and all other methods of collective enforcement of any type of agreement, whether it relates to resale price maintenance or anything else. Therefore, it is necessary to make sure that the jurisdiction or the Restrictive Practices Court under Clause 15 is sufficiently wide to deal with this matter.
    There is no need to remind the Committee that this Court will have no inherent jurisdiction. Any jurisdiction which this Court enjoys will be derived from this Bill, as an Act of Parliament, and I assume that this jurisdiction will be circumscribed by the Bill and will be narrowly interpreted if any question of jurisdiction arises. It is essential, therefore, that in a Clause giving jurisdiction to the Court there should be no doubt about what its powers should be. It is the object of the Amendment to ensure that, and I think that the President of the Board of Trade must tell us why the Government are resisting it. Do they say that it is unnecessary? If they do, I would say that that is an additional reason why a provision of this kind should be inserted in the Bill.
    Mr. Reader Harris: I listened very carefully to the hon. Member for Islington, North (Mr. Fienburgh). He moved the Amendment in open terms, but entirely forgot to

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    relate it to his argument. Could the hon. Member for Islington, East (Mr. E. Fletcher) explain how the Amendment gets over the point?
    9.30 p.m.
    Mr. Fletcher: I am sorry. This is a difficult subject, and I was hoping that between us we had succeeded in putting the point. I will endeavour to put these things in the simplest possible language.
    Subsection (1) of Clause 15 is the only provision in this Bill which gives this Court any jurisdiction; in other words, it tells the Court what it can do.
    Mr. Fienburgh: Use single syllable words.
    Mr. Fletcher: Omitting the superflous words, it says that the Court shall have jurisdiction to declare whether or not any restrictions in an agreement to which Part I applies are contrary to the public interest. We do not want the Court to be confined merely to saying either that a particular agreement is contrary to the public interest or that it is not. We are concerned not merely with the contents of agreements but we are concerned also with the methods by which agreements are enforced.
    If the hon. Member for Heston and Isleworth (Mr. R. Harris) has studied the latest Report of the Monopolies Commission—and, after all, it was that which was the genesis, so to speak, of this Bill—he will have in mind that that Report is directed not to saying that agreements of a particular kind are contrary to the public interest, but to saying that the collective enforcement of certain agreements is contrary to the public interest, because certain agreements are enforced by practices, such as secret courts, stop lists, and other methods, which, to say the least, are offensive to public opinion.
    Therefore, any Court must consider two things, not only the objects of any agreement, as to whether, if it rid itself of any objectionable provisions, it might serve the public interest, but also whether the methods by which the agreement is going to be enforced are themselves objectionable. I should have thought that this was so plain that we might hope eventually to get the President's concurrence. What we are pressing for is to make it quite clear that the Court should have jurisdiction to deal not only with the parts of the agreement which provide
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    for what the prices shall be and where people shall deal, and so forth, but also with any parts of the agreement, whether written or oral, providing for the enforcement of it.
    It seems to me that this Court will, without that power, be paralysed. In, discussing earlier Clauses, it has already been pointed out that unless certain of them are redrafted it will be very easy for a great number of traders to defy this Bill with impunity; and it is because we are so shocked at some of the weaknesses in earlier Clauses that we feel it should be made quite clear that the Court has power to deal with all these matters.
    As to whether it is necessary or not, the Parliamentary Secretary referred to subsection (2). I imagine that he will pray that in aid in saying it is not necessary. But we cannot be too careful. Even if the Parliamentary Secretary does not think it necessary, what objection can there be to inserting the words, so as to make it plain to the world that the Court has this power? What we do not want is that, after this Bill has been enacted, a trader can object—contrary to the opinion of the Parliamentary Secretary—and can point out that the Court has not the jurisdiction to do this.
    Why take that risk? Why not make it plain? That is the simple object of this Amendment, and I hope that the President, with his good sense and sympathy to our constructive arguments, will now be disposed to accept it.
    Mr. Simon: There is an important point involved here, and I should like to be certain that it is covered by the terms of the Clause. There are many agreements at present in force whereby restrictions are imposed on the parties. Those restrictions are enforceable not, as has been said, by secret courts but, generally speaking, by private courts set up by the parties themselves, and those courts only have jurisdiction by virtue of the agreements.
    It is clear that the restrictions can be declared by the Court to be contrary to public interest. Both hon. Members who have spoken on the Amendment have used the phrase "either the particular agreement is contrary to public interest or not". With great respect, that is not so. The Court can say that specific restrictions within the agreements are

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    contrary to public interest; in other words, the Court has not merely to say that the whole agreement is contrary to the public interest or not.
    However, supposing that the Court says that the particular restriction is not against public interest, there still remains the residual question, can it be enforceable through the ordinary courts—presumably it can, since it is not contrary to public interest—or is there still an alternative method of enforcement through the private courts which are established under the agreement? That really comes down to the question whether a stipulation in the agreement establishing the private courts of the parties comes within the words "any restrictions". I should be grateful to hear from my hon. Friend whether in his opinion it does so or not.
    Mr. A. E. Oram: If I understood the Parliamentary Secretary aright, he was arguing at one point that undesirable methods of enforcement would come to an end in those cases where the restrictive agreement is condemned by the Court. The hon. Gentleman reinforced that later in agreeing that this Amendment is unnecessary, but if, in fact, those methods of enforcement would fall to the ground, why not write this Amendment into the Bill? That would at least have the virtue of making the Clause clearer. It would at least have the virtue of making certain that the Court has the power both to condemn the agreement and to condemn the methods used to enforce the agreement. I see no harm in that; on the contrary; I can see much virtue in it.
    I want to reinforce the argument of my hon. Friend the Member for Islington, East (Mr. E. Fletcher). He said that so often it is not so much that the agreement is reprehensible in these matters but that the method of enforcement is undesirable. Certainly that is so in the public mind. We can recall that a year or so ago there was a good deal of publicity in the Press about Mr. Mendelssohn and other cases, and I am sure that public indignation over those cases was directed more to the secret courts, more to the snoopers, than to the agreements which we coming under criticism.
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    What the public does not like in these matters is to have agents of trade associations going into shops, perhaps representing themselves to be ordinary customers, and trapping a shopkeeper into breaking an agreement into which he or she had entered. It is that sort of thing that the public find most undesirable and that the Court should have full power to condemn. Secret courts have been mentioned—
    Mr. Simon: Private courts.
    Mr. Oram: What is the difference between private courts and secret courts?
    Mr. Simon: As the hon. Member asks we what the difference is, I would say that one sits in public and the other sits in private.
    Mr. Oram: I am sure that the hon. and learned Member for Middlesbrough, West (Mr. Simon) will agree that there are in fact secret courts, and it is those that the Restrictive Practices Court ought particularly to be able to condemn. There are secret courts where the Press and the public are not allowed, and those are the secret courts to which the public very strongly object, for they offend against the public sense of what is fair in these matters. The Press and the public are permitted to enter all our courts and Governmental institutions, which gives them the hallmark of fairness.
    Where there is, as there may well be, an agreement which is comparatively harmless combined with a method of enforcement which is offensive, the Restrictive Practices Court ought to have full opportunity to say that the agreement is all right but that the method of enforce-men is wrong. With the Clause worded as it is, I do not think that the Court can have that power. Our Amendment is designed to ensure that it has that power.
    Mr. R. Harris: I should have thought that the Bill made it clear that the Restrictive Practices Court has that power. One thing that is certain is that unless there is power to enforce an agreement which has been approved by the Court, then the whole Bill becomes nonsense. Clearly, if the Court approves an agreement, there must be power to enforce it.
    Sir L. Ungoed-Thomas: However objectionable the method may be? That is what we are talking about.
    Mr. Harris: I hope that the Court will be able to say, "We do not like this method of enforcement"—
    Sir L. Ungoed-Thomas: That is what we are asking for.
    Mr. Harris:—and will be able to suggest some other form of enforcement. I would support the Amendment to that extent. I do not disagree with what has been said by the hon. Member for Islington, North (Mr. Fienburgh), for he has stated the situation correctly. There must be some method of enforcing the agreement.
    I do not agree that the method of private courts is necessarily bad. The hon. Member for Islington, East (Mr. E. Fletcher) is waving the Commission's Report at me. The Minority Report did not condemn all these methods. It is not true to say that all the so-called secret courts are as bad as some hon. Members opposite and the Press have made them out to be—
    The Deputy-Chairman: Secret courts are not involved in the Amendment.
    Mr. Harris: The hon. Member for Islington, North said that they were bad. Surely, Sir Rhys, I am entitled to say that they are not bad.
    The Deputy-Chairman: The hon. Gentleman is not following the argument. The method of enforcement is not relevant here.
    Mr. Harris: The method of enforcement has been mentioned. I gather that some hon. Members opposite are against what they describe as the secret court method. I am saying that there is no particular reason why the Restrictive Practices Court should not approve of these so-called secret courts. After all, the only reason why they are secret is that they are not covered by the laws of privilege which apply to the ordinary courts of our land—
    The Deputy-Chairman: This discussion is irrelevant to the Amendment. The question is wether the method of enforcement is covered by the Clause or not.
    Mr. Harris: I suppose, Sir Rhys, we cannot discuss the particular method of enforcement. Maybe by so doing we should be anticipating later Amendments.
    I have tried to cover in a later amendment the other point raised by the hon. Member for Islington, North, showing how much I am in sympathy with the point of view which he has put forward.
    9.45 p.m.
    The main point which we must get across is that there must be some method of enforcing these agreements. It would be intolerable if the Court disapproved a particular agreement merely because one particular item of the method of enforcement was not approved by the Court. I am certain that in practice the Court will look at the agreement and say whether or not it is in the public interest, and then look at the method of enforcement and presumably make suggestions on the way in which the agreement can be enforced by a method which is not against the public interest.
    Mr. Fienburgh: I should like to pick up a point made in the last speech by the Parliamentary Secretary. He sought to prove that the question of enforcement was within the jurisdiction of the Court. I think that that was his final point. Under Clause 15 (1) the jurisdiction of the Court covers the restrictions and the restrictions alone. The Parliamentary Secretary then referred us to the tail end, as he called it, of Clause 16, which, he said, imported considerations of public interest. Therefore, if we added the two together, we should find that the Court would be awarded jurisdiction over the methods of enforcement because that would be a matter of public interest, as set out in Clause 16.
    When we look at Clause 16, we see that it is again exclusively related to the restrictions. There is the question of the agreement as a whole, and the agreement as a whole does not come before the Court. The agreement contains two things—the restriction and the means of enforcement of that restriction. Nowhere, in either this Clause or the subsequent Clause, has the Court any jurisdiction over the agreement as a whole. It has jurisdiction only over the restriction, which is only one part of the agreement. The other part of the agreement, which is the method of enforcement, it cannot touch

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    at all. I think that the lawyers might often argue successfully that if the Court tried to say anything at all about the part of the agreement relating to enforcement or if it had anything to say about the agreement other than the part concerning the restriction which it either approved or disapproved that would not stand up to examination.
    Mr. Walker-Smith: I will try to reply in a few words to the points made since I last addressed myself to this Amendment. The hon. Member for Islington, North (Mr. Fienburgh) is quite right when he says that there is a distinction between a restriction and the agreement that embodies it and that that is of importance in this context, although I am bound to say that it has not the importance which he sought to attribute to it.
    If the Committee will bear with me, I will make another attempt to explain why, in my view, this Amendment is unnecessary. The Court has jurisdiction to determine whether restrictions are contrary to the public interest. The hon. Gentleman's Amendment is concerned with what he calls methods of enforcement, and we are agreed that for this purpose methods of enforcement may be such things as private courts with their fines, collective boycott and discrimination, stop lists, and the like.
    Taking, first, the case of the private court which is set up by agreement between the parties, which is the case postulated by my hon. and learned Friend the Member for Middlesbrough, West (Mr. Simon), the court is seized of jurisdiction in regard to the agreement setting up the private court and the provisions which I have already drawn attention to in subsection (2, a) enables the Court to make an order restraining the parties from enforcing or purporting to enforce the agreement.
    It is, therefore, clear that if the private court is constituted on that basis, the Restrictive Practices Court has jurisdiction under this Clause. If the private court does not function on this basis, the other only basis on which it could be erected, is, as I suggested earlier, the basis of collective discrimination, or the boycott, or the stop-list. If there is agreement for that, whereby the parties accept these restrictions implicit in the collective discrimination, that is one of
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    the matters covered in Clause 5 (1, e). Therefore, that is also directly justiciable by the Restrictive Practices Court and an order could be made preventing it from going on.
    There is only one other question which remains. Suppose these restrictions are embodied in a single agreement and the Court is minded to approve the restriction, for example, in respect of common minimum prices under Clause 5 (1, a) but it does not wish to approve the restriction in respect of collective discrimination under Clause 5 (1, e) because it does not wish any possibility of a private court. In my submission, the Court is in no difficulty in this matter, because that is what the provisions of subsection (3) are intended to deal with. Those are the provisions—
    Mr. E. Fletcher indicated dissent.
    Mr. Walker-Smith: The hon. Member shakes his head, but I am gratified to observe that the hon. and learned Member for Stoke Newington and Hackney, North (Mr. Weitzman) nods, and I am always glad to have his acquiescence on any matter of law.
    Those are the provisions whereby, before the Court makes its order, it is possible for the parties to modify the agreement, that is to say, they can split the agreement and ask the Court to approve—taking my example—of the provisions dealing with common minimum prices; and the Court can prohibit the agreement in respect of collective discrimination. Alternatively, as a matter of precedent the Court could prohibit the original provision entirely and authorise a varied agreement containing only the part which it wished to approve as being not contrary to the public interest and prohibiting the other part.
    I think that that is as clear as I can make it. I am satisfied that this provision is not necessary to do what is required and the Committee will appreciate that to write in words which are not necessary will tend only to confuse and not to clarify. I hope that I have succeeded in convincing the Committee. If I have failed, I hope that we may agree to differ and so solve the difficulty in that way.
    Sir L. Ungoed-Thomas: I am obliged to the Parliamentary Secretary for his very clear exposition. What emerges from it is that it does not meet the sub

    521
    stance of the points made by my hon. Friends. I will take his answer briefly, point by point. Clause 15 (2) deals only with cases where the restrictions are determined by the Court to be contrary to the public interest. That was not the gravamen of the case made by my hon. Friends the Member for Islington, North (Mr. Fienburgh) and Islington, East (Mr. E. Fletcher).
    We are concerned with the case where it is not declared contrary to the public interest and, therefore, Clause 15 (2) does not cover that case. The hon. Gentleman said, rightly, that the method of enforcement by collective boycott or, rather, by the withholding of goods, would be covered by Clause 5 (1. e).
    Again, I agree that the method of withholding goods would come within Clause 5 (1, e), but it does not cover other methods. For instance, it does not cover the method of enforcement by fine; it does not cover the method of enforcement by cutting off from membership of an association; it would not cover enforcement by the method of deleting a member from certain privileges of association which may be absolutely vital to him, such as participation in research work.
    Take the case with which the hon. and learned Member for Middlesbrough, West (Mr. Simon) was so much concerned, namely, the operation of secret and private courts. We can envisage the possibility that the Court might permit as a method of enforcement a private court with safeguards, for instance, representation by counsel, or solicitors—I am prepared to bring them in—and the operation of the Court in public, instead of in secret and with all kinds of safeguards laid down by the Court, as we have, for instance, in the case of the British Medical Council. In those circumstances, a private court might be unobjectionable.
    All those come within the terms of the Amendment. All those would enable the Court to have discretion—that is all we ask—with regard to the methods of enforcement when none of those methods of enforcement is covered by Clause 15 (2), or Clause 5 (1, e). Although we are very grateful for the Parliamentary Secretary's explanation, we must press the Amendment.
    Question put, That those words be there inserted:—
    The Committee divided: Ayes 187, Noes 217.

    Division No. 164.]

    AYES

    [9.57 p.m.

    Ainsley, J. W.

    Cullen, Mrs. A.

    Howell, Denis (All Saints)

    Allaun, Frank (Salford, E.)

    Dalton, Rt. Hon. H.

    Hubbard, T. F.

    Allen, Arthur (Bosworth)

    Darling, George (Hillsborough)

    Hughes, Cledwyn (Anglesey)

    Allen, Scholefield (Crewe)

    Davies, Stephen (Merthyr)

    Hughes, Hector (Aberdeen, N.)

    Awbery, S. S.

    Deer, G.

    Hunter, A. E.

    Bacon, Miss Alice

    Delargy, H. J.

    Irvine, A. J. (Edge Hill)

    Bence, C. R. (Dunbartonshire, E.)

    Dodds, N. N.

    Irving, S. (Dartford)

    Benn, Hn. Wedgwood (Bristol, S.E.)

    Dugdale, Rt. Hn. John (W. Brmwch)

    Jay, Rt. Hon. D. P. T.

    Benson, G.

    Edelman, M.

    Jenkins, Roy (Stechford)

    Beswick, F.

    Edwards, Rt. Hon. John (Brighouse)

    Johnson, James (Rugby)

    Blackburn, F.

    Edwards, Rt. Hon. Ness (Caerphilly)

    Jones, David (The Hartlepools)

    Blenkinsop, A.

    Edwards, Robert (Bilston)

    Jones, Jack (Rotherham)

    Blyton, W. R.

    Evans, Stanley (Wednesbury)

    Jones, J. Idwal (Wrexham)

    Bottomley, Rt. Hon. A. C.

    Fernyhough, E.

    Jones, T. W. (Merioneth)

    Bowden, H. W. (Leicester, S.W.)

    Fienburgh, W.

    Key, Rt. Hon. C. W.

    Bowen, E. R. (Cardigan)

    Fletcher, Eric

    King, Dr. H. M.

    Bowles, F. G.

    Forman, J. C.

    Lawson, G. M.

    Boyd, T. C.

    Fraser, Thomas (Hamilton)

    Ledger, R. J.

    Braddock, Mrs. Elizabeth

    Gibson, C. W.

    Lee, Frederick (Newton)

    Brockway, A. F.

    Gooch, E. G.

    Lee, Miss Jennie (Cannock)

    Broughton, Dr. A. D. D.

    Grenfell, Rt. Hon. D. R.

    Lever, Leslie (Ardwick)

    Brown, Thomas (Ince)

    Grey, C. F.

    Lewis, Arthur

    Burton, Miss F. E.

    Butler, Herbert (Hackney, C.)

    Griffiths, David (Rother Valley)

    Logan, D. G.

    Butler, Mrs. Joyce (Wood Green)

    Griffiths, Rt. Hon. James (Llanelly)

    Mabon, Dr. J. Dickson

    Callaghan, L. J.

    Griffiths, William (Exchange)

    McGhee, H. G.

    Castle, Mrs. B. A.

    Hale, Leslie

    McGovern, J.

    Champion, A. J.

    Hamilton, W. W.

    McInnes, J.

    Chapman, W. D.

    Hannan, W.

    McKay, John (Wallsend)

    Clunie, J.

    Hastings, S.

    McLeavy, Frank

    Coldrick, W.

    Hayman, F. H.

    MacMillan, M. K. (Western Isles)

    Collick, P. H. (Birkenhead)

    Henderson, Rt. Hn. A. (Rwly Regis)

    MacPherson, Malcolm (Stirling)

    Collins, V. J. (Shoreditch & Finsbury)

    Harbison, Miss M.

    Mahon, Simon

    Corbet, Mrs. Freda

    Hobson, C. R.

    Mallalieu, E. L. (Brigg)

    Craddock, George (Bradford, S.)

    Holmes, Horace

    Mallalieu, J. P. W. (Huddersfd, E.)

    Cronin, J. D.

    Holt, A. F.

    Marquand, Rt. Hon. H. A.

    Crossman, R. H. S.

    Houghton, Douglas

    Mason, Roy

    Mayhew, C. P.

    Price, Philips (Gloucestershire, W.)

    Thomson, George (Dundee, E.)

    Messer, Sir F.

    Probert, A. R.

    Timmons, J.

    Mikardo, Ian

    Proctor, W. T.

    Tomney, F.

    Mitchison, G. R.

    Pryde, D. J.

    Turner-Samuels, M.

    Monslow, W.

    Randall, H. E.

    Ungoed-Thomas, Sir Lynn

    Moody, A. S.

    Redhead, E. C.

    Usborne, H. C.

    Morris, Percy (Swansea, W.)

    Reeves, J.

    Wade, D. W.

    Mort, D. L.

    Roberts, Albert (Normanton)

    Warbey, W. N.

    Moss, R.

    Roberts, Goronwy (Caernarvon)

    Weitzman, D.

    Moyle, A.

    Robinson, Kenneth (S. Pancras, N.)

    Wells, William (Walsall, N.)

    Mulley, F. W.

    Ross, William

    West, D. G.

    Neal, Harold (Bolsover)

    Royle, C.

    Wheeldon, W. E.

    Noel-Baker, Francis (Swindon)

    Short, E. W.

    White, Henry (Derbyshire, N.E.)

    Oliver, C. H.

    Silverman, Julius (Aston)

    Wilkins, W. A.

    Oram, A. E.

    Skeffington, A. M.

    Willey, Frederick

    Or bach, M.

    Slater, Mrs. H. (Stoke, N.)

    Williams, Rev. Llywelyn (Ab'tillery)

    Oswald, T.

    Slater, J. (Sedgefield)

    Williams, W. R. (Openshaw)

    Owen, W. J.

    Smith, Ellis (Stoke, S.)

    Willis, Eustace (Edinburgh, E.)

    Paling, Rt. Hon. W. (Dearne Valley)

    Sorensen, R. W.

    Wilson, Rt. Hon. Harold (Huyton)

    Paling, Will T. (Dewsbury)

    Steele, T.

    Winterbottom, Richard

    Palmer, A. M. F.

    Stewart, Michael (Fulham)

    Woodburn, Rt. Hon. A.

    Pargiter, G. A.

    Stones, W. (Consett)

    Woof, R. E.

    Parker, J.

    Stross, Dr. Barnett (Stoke-on-Trent, C.)

    Yates, V. (Ladywood)

    Parkin, B. T.

    Summerskill, Rt. Hon. E.

    Zilliacus, K.

    Paton, J.

    Sylvester, G. O.

    Plummer, Sir Leslie

    Taylor, Bernard (Mansfield)

    TELLERS FOR THE AYES:

    Popplewell, E.

    Taylor, John (West Lothian)

    Mr. Pearson and Mr. J. T. Price.

    NOES

    Agnew, Comdr. P. G.

    Fisher, Nigel

    Kirk, P. M.

    Aitken, W. T.

    Fleetwood-Hesketh, R. F.

    Langford-Holt, J. A.

    Allan, R. A. (Paddington, S.)

    Fletcher-Cooke, C.

    Leather, E. H. C.

    Alport, C. J. M.

    Fraser, Hon. Hugh (Stone)

    Leavey, J. A.

    Amery, Julian (Preston, N.)

    George, J. C. (Pollok)

    Leburn, W. G.

    Arbuthnot, John

    Gibson-Watt, D.

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

    Armstrong, C. W.

    Glover, D.

    Legh, Hon. Peter (Petersfield)

    Ashton, H.

    Godber, J. B.

    Lindsay, Hon. James (Devon, N.)

    Baldock, Lt.-Cmdr. J. M.

    Gomme-Duncan, Col. Sir Alan

    Linstead, Sir H. N.

    Baldwin, A. E.

    Cower, H. R.

    Lloyd, Maj. Sir Guy (Renfrew, E.)

    Balniel, Lord

    Graham, Sir Fergus

    Longden, Gilbert

    Barlow, Sir John

    Grant, W. (Woodside)

    Lucas, Sir Jocelyn (Portsmouth, S.)

    Barter, John

    Green, A.

    Lucas, P.B.(Brentford & Chiswick)

    Bell, Philip (Bolton, E.)

    Gresham Cooke, R.

    Lucas-Tooth, Sir Hugh

    Bell, Ronald (Bucks, S.)

    Grimston, Hon. John (St. Albans)

    Macdonald, Sir Peter

    Bennett, Dr. Reginald

    Grimston, Sir Robert (Westbury)

    McKibbin, A. J.

    Bevins, J. R. (Toxteth)

    Grosvenor, Lt.-Col. R. G.

    Mackie, J. H. (Galloway)

    Biggs-Davison, J. A.

    Gurden, Harold

    McLaughlin, Mrs. P.

    Bishop, F. P.

    Hall, John (Wycombe)

    Maclean, Fitzroy (Lancaster)

    Body, R. F.

    Harris, Frederic (Croydon, N.W.)

    McLean, Neil (Inverness)

    Boyle, Sir Edward

    Harris, Reader (Heston)

    MacLeod, John (Ross & Cromarty)

    Braine, B. R.

    Harrison, A. B. C. (Maldon)

    Macpherson, Niall (Dumfries)

    Braithwaite, Sir Albert (Harrow, W.)

    Harrison, Col. J. H. (Eye)

    Maddan, Martin

    Brooke, Rt. Hon. Henry

    Harvey, Air Cdre. A. V. (Macclesfd)

    Manningham-Buller, Rt. Hn. Sir R.

    Brooman-White, R. C.

    Harvey, Ian (Harrow, E.)

    Markham, Major Sir Frank

    Bryan, P.

    Harvey, John (Walthamstow, E.)

    Marlowe, A. A. H.

    Burden, F. F. A.

    Hay, John

    Marshall, Douglas

    Butcher, Sir Herbert

    Heald, Rt. Hon. Sir Lionel

    Mathew, R.

    Carr, Robert

    Heath, Rt. Hon. E. R. G.

    Maude, Angus

    Cary, Sir Robert

    Henderson, John (Cathcart)

    Mawby, R. L.

    Chichester-Clark, R.

    Hill, Mrs. E. (Wythenshawe)

    Maydon, Lt.-Comdr. S. L. C.

    Clarke, Brig. Terence (Portsmth, W.)

    Hinchingbrooke, Viscount

    Milligan, Rt. Hon. W. R.

    Cole, Norman

    Hornsby-Smith, Miss M. P.

    Moore, Sir Thomas

    Cordeaux, Lt.-Col. J. K.

    Horobin, Sir Ian

    Morrison, John (Salisbury)

    Corfield, Capt. F. V.

    Howard, John (Test)

    Mott-Radclyffe, C. E.

    Craddock, Beresford (Spelthorne)

    Hudson, Sir Austin (Lewisham, N.)

    Nairn, D. L. S.

    Crosthwaite-Eyre, Col. O. E.

    Hudson, W. R. A. (Hull, H.)

    Nicholson, Godfrey (Farnham)

    Crowder, Sir John (Finchley)

    Hughes Hallett, Vice-Admiral J.

    Nicolson, N. (B'n'm'th, E. & Chr'ch)

    Cunningham, Knox

    Hughes-Young, M. H. C.

    Nield, Basil (Chester)

    Currie, G. B. H.

    Kurd, A. R.

    Oakshott, H. D.

    Dance, J. C. G.

    Hutchison, Sir Ian Clark (E'b'gh, W.)

    O'Neill, Hn. Phelim (Co. Antrim, N.)

    D'Avigdor-Goldsmid, Sir Henry

    Hutchison, Sir James (Scotstoun)

    Ormsby-Gore, Hon. W. D.

    Deedes, W. F.

    Iremonger, T. L.

    Orr, Capt. L. P. S.

    Donaldson, Cmdr. C. E. McA.

    Irvine, Bryant Godman (Rye)

    Osborne, C.

    Doughty, C. J. A.

    Jenkins, Robert (Dulwich)

    Page, R. G.

    Drayson, G. B.

    Johnson, Dr. Donald (Carlisle)

    Pannell, N. A. (Kirkdale)

    du Cann, E. D. L.

    Johnson, Eric (Blackley)

    Partridge, E.

    Duncan, Capt. J. A. L.

    Jones, Rt. Hon. Aubrey (Hall Green)

    Pickthorn, K. W. M.

    Duthie, W. S.

    Joseph, Sir Keith

    Pilkington, Capt. R. A.

    Eden, J. B. (Bournemouth, West)

    Joynson-Hicks, Hon. Sir Lancelot

    Pitt, Miss E. M.

    Emmet, Hon. Mrs. Evelyn

    Keegan, D.

    Pott, H. P.

    Errington, Sir Erie

    Kerr, H. W.

    Powell, J. Enoch

    Farey-Jones, F. W.

    Kershaw, J. A.

    Profumo, J. D.

    Finlay, Graeme

    Kimball, M.

    Raikes, Sir Victor

    524

    525

    Ramsden, J. E.

    Smyth, Brig. Sir John (Norwood)

    Turton, R. Hon. R. H.

    Rawlinson, Peter

    Spearman, A, C. M.

    Tweedsmuir, Lady

    Redmayne, M.

    Speir, R. M.

    Vane, W. M. F.

    Rees-Davies, W. R.

    Stanley, Capt. Hon. Richard

    Vaughan-Morgan, J. K.

    Remnant, Hon. P.

    Stevens, Geoffrey

    Vickers, Miss J. H.

    Renton, D. L. M.

    Steward, Harold (Stockport, S.)

    Wakefield, Sir Wavell (St. M'lebone)

    Ridsdale, J. E.

    Stewart, Henderson (Fife, E.)

    Walker-Smith, D. C.

    Rippon, A. G. F.

    Stoddart-Scott, Col. M.

    Wall, Major Patrick

    Roberts, Sir Peter (Heeley)

    Studholme, H. G.

    Ward, Hon. George (Worcester)

    Robertson, Sir David

    Summers, G. S. (Aylesbury)

    Ward, Dame Irene (Tynemouth)

    Roper, Sir Harold

    Taylor, William (Bradford, N.)

    Waterhouse, Capt. Rt. Hon. C.

    Ropner, Col. Sir Leonard

    Teeling, W.

    Webbe, Sir H.

    Russell, R. S.

    Thompson, Kenneth (Walton)

    Whitelaw, W.S.I.(Penrith & Border)

    Schofield, Lt.-Col. W.

    Thompson, Lt.-Cdr.R.(Croydon, S.)

    Williams, Paul (Sunderland, S.)

    Scott-Miller, Cmdr. R.

    Thorneycroft, Rt. Hon. P.

    Wills, G. (Bridgwater)

    Sharpies, R. C.

    Thornton-Kemsley, C. N.

    Wilson, Geoffrey (Truro)

    Shepherd, William

    Tilney, John (Wavertree)

    Woollam, John Victor

    Simon, J. E. S. (Middlesbrough, W.)

    Touche, Sir Gordon

    Smithers, Peter (Winchester)

    Turner, H. F. L,

    TELLERS FOR THE NOES:

    Mr. Wakefield and Mr Barber.

    Amendment made: In page 13, line 16, leave out "determined" and insert "found."—[Mr. P. Thorneycroft.]
    Mr. Mulley: I beg to move, in page 13, line 18, after "Registrar," to insert "or any interested party."
    This is a small Amendment, but, I think, one of some importance because its purpose is to give to any interested party in an agreement the power to apply to the Court for an order where restrictions have already been determined by the Court to be contrary to the public interest.
    It seems, as the Committee wends its slow way through the Bill, that the task of the Registrar is going to be extremely difficult, and that he is going to be bogged down in the complexities when some parts of an agreement are held to be contrary to the public interest and other parts of the same agreement are subject to a contrary decision.
    It seems to us that if, as may well be the case, an individual trader or a number of traders are being pursued under an agreement that has already been held to be contrary to the public interest, such a trader or traders should, rather than wait and go through all the bureaucracy of getting the Registrar to apply to the Court, have the right to go to the Court and ask for an order to protect their interests in the matter. I hope, therefore, that this simple but important Amendment will commend itself to the President of the Board of Trade and that he will agree to insert it in the Clause.
    Mr. P. Thorneycroft: I fully appreciate the spirit in which the Amendment has been moved. It is moved in the desire to see that where an arrangement is held to be against the public interest speedy and efficacious methods should be adopted to
    526
    obtain an order to deal with it. That is the purpose behind the Amendment, and it is a perfectly proper purpose.
    I agree with the hon. Member for Sheffield, Park (Mr. Mulley) when he says that the task of the Registrar will be a difficult one. So, also, will be the task of the Court, and we really must take responsible steps to see that neither the Registrar nor the Court have their tasks rendered not only difficult, but quite impossible by a mass of applications from every quarter. The Committee should bear in mind what the ordinary procedure here will be.
    The Registrar will be responsible for initiating proceedings before the Court. We have discussed, or are to discuss, whether others should have that right. We have, in fact, discussed it on an Amendment today and we had to refuse it, because if everyone could initiate proceedings there would be chaos in the courts. We discussed earlier the difficulties about getting this large number of cases dealt with under any arrangement. We may have differed about the precise arrangements, but we are all agreed on the magnitude of the task, and we must channel things in their right order and place.
    The procedure will be that normally the Registrar will initiate the proceedings, asking the Court to determine whether these particular restrictions are for or against the public interest. The normal thing will be that in the same proceedings the Registrar will ask for an order. That will be the normal process. If these things are found to be against the public interest he will normally ask for an order, and the Court will, I imagine, in ordinary cases, grant it.

    527
    But supposing that for some reason—on an undertaking by the parties or something of that nature—the Court in its wisdom—and it will be for the Court—decides that it does not wish to issue an order, it would not be tolerable for anybody else, or for some other party to some other agreement, where the Court has failed to issue an order, to ask the Registrar to go through the proceedings all over again. In that case the Court will never get on with its proper job. We are really anxious not to make proceedings interminable. Many hon. Members have spoken of the need to press on and to get clarity and expedition, but to accept this Amendment would be to spin out the proceedings interminably.
    I fully appreciate that that was not the intention of the hon. Member for Sheffield, Park. His intention was the perfectly proper one of making quite certain that expeditious arrangements could be made to enforce these particular orders when the agreement was held to be against the public interest, but I hope that on my explanation he will realise—
    Mr. Mulley: If it is true that, as a matter of course, the Registrar will ask for an order, then the Amendment would not seriously delay proceedings because the case would not arise. I have in mind that some serious, urgent matter might occur in relation to some traders, and that instead of being able to go direct to the Court they will have to go along the circuitous route via the Registrar. From what the President has said, it can only occur in one case in a thousand, but it seems to me that the interested party should have consideration.
    Mr. Thorneycroft: The Amendment would mean that if the Registrar had asked for an order and had failed to get it anyone else could ask the Court for an order, and I think all hon. Members will agree that that would be an intolerable imposition on the Court.
    Sir L. Ungoed-Thomas: The substance of the Amendment is as put by my hon. Friend the Member for Sheffield, Park (Mr. Mulley), and the President obviously appreciated the point of substance we are making. I do not say that this wording in the Amendment is the most desirable that could be obtained, but we are dealing with the substance of the point here.
    528
    The substance of the Amendment is that when there is a party aggrieved, as my hon. Friend pointed out so clearly, there ought to be some remedy available to him, and it should not be just restricted to the Registrar.
    I agree, of course, that the course which one would expect to be adopted would be that the Registrar would, at the end of the proceedings, apply for an order—or obtain an undertaking which would have exactly the same effect as an order—restraining the parties to the agreement from giving effect to the restriction. But suppose that that is not done and that a poor retailer, or someone like that, is affected by the restriction. He knows where the shoe pinches—why should he not have a shout straight off and be able to go to the Court and say, "This is what is happening. You had these proceedings; you have made the declaration. These people are, in fact, enforcing this or that contrary to my interests."
    He is the person who knows, and not only is he the person who knows, but he is the person who is interested in seeing that the matter is dealt with. He should not have to go to the Registrar, make out the case to him, and then, by the Registrar's leave and if the Registrar decides in his favour, go to the Court. If this matter is decided as being not contrary to the public interest, and the agreement is allowed to continue, there should be access for that person to go to court and seek a remedy immediately.
    10.15 p.m.
    This is in line with our objection to so much in the Bill. Everything is tied up so much with everything else that these procedural difficulties meet us all the way in getting quick and effective remedies. That is why we have attacked so much in the Bill. I am making no allegations against the President personally; I know that he is anxious to see that the Bill is made effective. But the clash which we have seen right through the Committee with the Government's views on the Bill is illustrated, as I ventured to suggest on Second Reading, in these procedural difficulties which clog up effective action the whole time.
    We have a simple remedy which could be made easily available to a party who is aggrieved by a person who attempts to enforce a restriction which has been declared contrary to the public interest.

    529
    Surely such a party should have immediate access to the Court. I agree that the wording of the Amendment may not be the most desirable wording. I at once accept responsibility for it, as I drafted it. Nevertheless, the substance of it is precisely as I have described it, and we ask the President to consider the substance of it.
    Mr. Denis Howell: Unlike everyone else who has spoken at various stages of the Bill, I confess at once that I know nothing about it. I intervene only because of the President's speech. It seems to me, as a layman, that this is a matter of some principle, because I gathered from what he said that this is to be the one branch of the law to which the ordinary person is not to have recourse of his own volition. Apparently he can appear before this new branch of the law only if he has the Registrar's approval.
    In the limited time since the President sat down, I have had advice from many of my legal hon. Friends, and I gather that this happens in no other branch of the law. Even in the criminal law an individual can take a prosecution, although because of the mechanics of the matter it is very rarely done. We know that in many other branches of the law, particularly in Chancery, there is great congestion. I was indirectly involved in a case which took a very long time before it got before the court, although it got there eventually.
    I cannot see, on a matter of principle, why the ordinary person, the man in the street, should be refused, in this one branch of the law, the right—even if it is used in a misguided manner—to appear before the court. This is an absolutely fundamental and new principle and I therefore make this short protest about it. I hope the President or a Law Officer will tell us why this entirely new principle is being introduced into the Bill.
    Mr. Cronin: At this late hour it is decorous that interventions should be brief and infrequent, but the President made some extraordinary statements which caused such disquiet on this side of the Committee that I feel bound to make some comments on them. First, he assured us that the courts will be snowed up by applications from private individuals as opposed to applications from the Registrar. Prima facie, that might be a useful point, but I would suggest to him—and I am sure that all hon. and learned Members will agree—that making these applications will be an extremely expensive business and that there is little likelihood of people using this expensive remedy extravagantly.
    The important point is that when it is known that an aggrieved person can himself take a case to court, it has a very powerful effect in restraining a potential restrictor. It is the sanction of what the individual might do rather than what he actually will do which will be effective. As my hon. Friend the Member for All Saints (Mr. D. Howell) said, the Bill introduces a new principle in law—that an aggrieved party cannot himself take action. Even in cases which we know in similar types of the law, an aggrieved party can take action. I refer now to the Patents and Designs Act, 1949. That Act gives the Comptroller of Patents wide powers, but under it any aggrieved person can actually make an application. The same applies to the Sherman Act of the United States.
    I suggest that we are offering to the President by this Amendment a simple and direct way of achieving the result we want. I suggest to him that the shortest distance between two points is a straight line, even if it does bisect his argument.
    Question put, That those words be there inserted:—
    The Committee divided: Ayes 151, Noes 188.

    Division No. 165.]

    AYES

    [10.21 p.m.

    Ainsley, J. W.

    Bottomley, Rt. Hon. A. G.

    Collick, P. H. (Birkenhead)

    Allaun, Frank (Salford, E.)

    Bowden, H. W. (Leicester, S.W.)

    Corbet, Mrs. Freda

    Awbery, S. S.

    Bowen, E. R. (Cardigan)

    Craddock, George (Bradford, S.)

    Bacon, Miss Alice

    Bowles, F. G.

    Cronin, J. D.

    Bence, C. R. (Dunbartonshire, E.)

    Boyd, T. C.

    Crossman, R. H. S.

    Benn, Hn. Wedgwood (Bristol, S.E.)

    Braddock, Mrs. Elizabeth

    Cullen, Mrs. A.

    Benson, G.

    Brockway, A. F.

    Dalton, Rt. Hon. H.

    Beswick, F.

    Broughton, Or. A. D. D.

    Darling, George (Hillsborough)

    Blackburn, F.

    Butler, Herbert (Hackney, C.)

    Deer, G.

    Blenkinsop, A.

    Champion, A. J.

    Delargy, H. J.

    Blyton, W. R.

    Coldrick, W.

    Dodds, N. N.

    Dugdale, Rt. Hn. John (W. Brmwch)

    Ledger, R. J.

    Probert, A. R.

    Edward, Rt. Hon. John (Brighouse)

    Lee, Frederick (Newton)

    Randall, H. E.

    Edwards, Robert (Bilston)

    Lee, Miss Jennie (Cannock)

    Roberts, Albert (Normanton)

    Evans, Stanley (Wednesbury)

    Lever, Leslie (Ardwick)

    Robinson, Kenneth (St. Pancras, S.)

    Fernyhough, E.

    Logan, D. G.

    Ross, William

    Fienburgh, W.

    Mabon, Dr. J. Dickson

    Short, E. W.

    Fletcher, Eric

    McGhee, H. G.

    Silverman, Julius (Aston)

    Forman, J. C.

    McInnes, J.

    Skeffington, A. M.

    Fraser, Thomas (Hamilton)

    McKay, John (Wallsend)

    Slater, Mrs. H. (Stoke, N.)

    Gibson, C. W.

    MacMillan, M. K. (Western Isles)

    Slater, J. (Sedgefield)

    Grenfell, Rt. Hon. D. R.

    MacPherson, Malcolm (Stirling)

    Sorensen, R. W.

    Grey, C. F.

    Matron, Simon

    Steele, T.

    Griffiths, David (Rother Valley)

    Mallalieu, J. P. W. (Huddersfd, E.)

    Stewart, Michael (Fulham)

    Griffiths, Rt. Hon. James (Llanelly)

    Marquand, Rt. Hon. H. A.

    Stones, W. (Consett)

    Griffiths, William (Exchange)

    Mason, Roy

    Summerskill, Rt. Hon. E.

    Grimond, J.

    Mayhew, C. P.

    Sylvester, G. O.

    Hale, Leslie

    Mikardo, Ian

    Taylor, Bernard (Mansfield)

    Hannan, W.

    Mitchison, G. R.

    Taylor, John (West Lothian)

    Hayman, F. H.

    Monslow, W.

    Thomas, George (Cardiff)

    Henderson, Rt. Hn. A. (Rwly Regis)

    Moody, A. S.

    Thomson, George (Dundee, E.)

    Herbison, Miss M.

    Morris, Percy (Swansea, W.)

    Timmons, J.

    Hobson, C. R.

    Moss, R.

    Tomney, F.

    Holt, A. F.

    Moyle, A.

    Ungoed-Thomas, Sir Lynn

    Houghton, Douglas

    Mulley, F. W.

    Usborne, H. C.

    Howell, Denis (All Saints)

    Neal, Harold (Bolsover)

    Wade, D. W.

    Hughes, Cledwyn (Anglesey)

    Noel-Baker, Francis (Swindon)

    Warbey, W. N.

    Hughes, Hector (Aberdeen, N.)

    Oliver, G. H.

    Weitzman, D.

    Hunter, A. E.

    Oram, A. E.

    Wells, William (Walsall, N.)

    Irvine, A. J. (Edge Hill)

    Orbach, M.

    Wheeldon, W. E.

    Irving, S. (Dartford)

    Oswald, T.

    White, Henry (Derbyshire, N.E.)

    Jay, Rt. Hon. D. P. T.

    Paling, Rt. Hon. W. (Dearne Valley)

    Willey, Frederick

    Jenkins, Roy (Stechford)

    Paling, Will T. (Dewsbury)

    Williams, W. R. (Openshaw)

    Johnson, James (Rugby)

    Palmer, A. M. F.

    Willis, Eustace (Edinburgh, E.)

    Jones, David (The Hartlepools)

    Pargiter, G. A.

    Wilson, Geoffrey (Truro)

    Jones, Jack (Rotherham)

    Parker, J.

    Winterbottom, Richard

    Jones, J. Idwal (Wrexham)

    Parkin, B. T.

    Woof, R. E.

    Jones, T. W. (Merioneth)

    Pearson, A.

    Yates, V. (Ladywood)

    Key, Rt. Hon. C. W.

    Plummer, Sir Leslie

    Zilliacus, K.

    King, Dr. H. M.

    Popplewell, E.

    Lawson, G. M.

    Price, Philips (Gloucestershire, W.)

    TELLERS FOR THE AYES:

    Mr. J. T. Price and Mr. Wilkins.

    NOES

    Agnew, Cmdr. P. C.

    Doughty, C. J. A.

    Jenkins, Robert (Dulwich)

    Aitken, W. T.

    Drayson, G. B.

    Johnson, Dr. Donald (Carlisle)

    Allan, R. A. (Paddington, S.)

    du Cann, E. D. L.

    Johnson, Eric (Blackley)

    Alport, C. J. M.

    Eden, J, B. (Bournemouth, West)

    Joseph, Sir Keith

    Amery, Julian (Preston, N.)

    Emmet, Hon. Mrs. Evelyn

    Joynson-Hicks, Hon. Sir Lancelot

    Arbuthnot, John

    Errington, Sir Eric

    Keegan, D.

    Armstrong, C. W.

    Farey-Jones, F. W.

    Kerby, Capt. H. B.

    Ashton, H.

    Finlay, Graeme

    Kerr, H. W.

    Baldock, Lt.-Cmdr. J. M.

    Fisher, Nigel

    Kershaw, J. A.

    Balniel, Lord

    Fleetwood-Hesketh, R. F.

    Kimball, M.

    Barber, Anthony

    Fletcher-Cooke, C.

    Kirk, P. M.

    Barlow, Sir John

    George, J. C. (Pollok)

    Langford-Holt, J. A.

    Barter, John

    Gibson-Watt, D.

    Leather, E. H. C.

    Baxter, Sir Beverley

    Glover, D.

    Leavey, J. A.

    Bell, Philip (Bolton, E.)

    Godber, J. B.

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

    Bell, Ronald (Bucks, S.)

    Gomme-Duncan, Col. Sir Alan

    Legh, Hon. Peter (Petersfield)

    Bennett, Dr. Reginald

    Grant, W. (Woodside)

    Linstead, Sir H. N.

    Bevins, J. R. (Toxteth)

    Green, A.

    Lloyd, Maj. Sir Guy (Renfrew, E.)

    Biggs-Davison, J. A.

    Gresham Cooke, R.

    Longden, Gilbert

    Bishop, F. P.

    Grimston, Sir Robert (Westbury)

    Lucas-Tooth, Sir Hugh

    Body, R. F.

    Grosvenor, Lt.-Col. R. G.

    Macdonald, Sir Peter

    Boyle, Sir Edward

    Gurden, Harold

    McKibbin, A. J.

    Braine, B. R.

    Hall, John (Wycombe)

    Mackie, J. H. (Galloway)

    Brooke, Rt. Hon. Henry

    Harris, Frederic (Croydon, N.W.)

    Maclean, Fitzroy (Lancaster)

    Burden, F. A. A.

    Harris, Reader (Heston)

    McLean, Neil (Inverness)

    Butcher, Sir Herbert

    Harrison, A. B. C. (Maldon)

    MacLeod, John (Ross & Cromarty)

    Carr, Robert

    Harrison, Col. J. H. (Eye)

    Macmillan, Rt. Hn. Harold (Bromley)

    Cary, Sir Robert

    Harvey, Air Cdre. A. V. (Macclesfd)

    Macpherson, Niall (Dumfries)

    Chichester-Clark, R.

    Harvey, Ian (Harrow, E.)

    Maddan, Martin

    Clarke, Brig. Terence (Portsmth, W.)

    Hay, John

    Manningham-Buller, Rt. Hn. Sir R.

    Cole, Norman

    Heald, Rt. Hon. Sir Lionel

    Markham, Major Sir Frank

    Cordeaux, Lt.-Col. J. K.

    Heath, Rt. Hon. E. R. G.

    Marshall, Douglas

    Corfield, Capt. F. V.

    Hill, Mrs. E. (Wythenshawe)

    Mathew, R.

    Craddock, Beresford (Spelthorne)

    Horobin, Sir Ian

    Maude, Angus

    Crosthwaite-Eyre, Col. O. E.

    Howard, John (Test)

    Mawby, R. L.

    Cunningham, Knox.

    Hudson, Sir Austin (Lewisham, N.)

    Maydon, Lt-Comdr. S. L. C.

    Currie, G. B. H.

    Hughes, Hallet, Vice-Admiral J.

    Milligan, Rt. Hon. W. R.

    Dance, J. C, G.

    Hughes-Young, M. H. C.

    Morrison, John (Salisbury)

    D'Avigdor-Goldsmid, Sir Henry

    Hutchison, Sir James (Scotstoun)

    Mott-Radclyffe, C. E.

    Deedes, W. F.

    Iremonger, T. L.

    Nairn, D. L. S.

    Donaldson, Cmdr. C. E. McA.

    Irvine, Bryant Godman (Rye)

    Nicolson, N. (B'n'm'th, E. & Chr'ch)

    532

    533

    Nield, Basil (Chester)

    Roberts, Sir Peter (Heeley)

    Thornton-Kemsley, C. N.

    Oakshott, H. D.

    Robertson, Sir David

    Tilney, John (Wavertree)

    O'Neill, Hn. Phelim (Co. Antrim, N.)

    Roper, Sir Harold

    Touche, Sir Gordon

    Ormsby-Core, Hon, W. D.

    Ropner, Col. Sir Leonard

    Turner, H. F. L.

    Osborne, C.

    Schofield, Lt.-Col. W.

    Tweedsmuir, Lady

    Page, R. G.

    Scott-Miller, Cmdr. R.

    Vane, W. M. F.

    Pannell, N. A, (Kirkdale)

    Sharpies, R. C.

    Vaughan-Morgan, J. K.

    Partridge, E.

    Shepherd, William

    Vickers, Miss J. H.

    Pickthorn, K. W. M.

    Simon, J. E. S. (Middlesbrough, W.)

    Wakefield, Edward (Derbyshire, W.)

    Pilkington, Capt. R. A.

    Smithers, Peter (Winchester)

    Wakefield, Sir Wavell (St. M'lebone)

    Pitt, Miss E. M.

    Speir, R. M.

    Walker-Smith, D. C.

    Pott, H. P.

    Stanley, Capt. Hon. Richard

    Wall, Major Patrick

    Powell, J, Enoch

    Stevens, Geoffrey

    Ward, Hon. George (Worcester)

    Profumo, J. D.

    Steward, Harold (Stockport, S.)

    Ward, Dame Irene (Tynemouth)

    Raikes, Sir Victor

    Stewart, Henderson (Fife, E.)

    Waterhouse, Capt. Rt. Hon. C.

    Ramsden, J. E.

    Stoddart-Scott, Col. M.

    Webbe, Sir H.

    Rawlinson, Peter

    Studholme, H. G.

    Whitelaw, W.S.I.(Penrith & Border)

    Redmayne, M.

    Summers, G. S. (Aylesbury)

    Williams, Paul (Sunderland, S.)

    Rees-Davies, W. R.

    Taylor, William (Bradford, N.)

    Wills, G. (Bridgwater)

    Remnant, Hon. P.

    Teeling, W.

    Wilson, Geoffrey (Truro)

    Renton, D. L. M.

    Thomas, Leslie (Canterbury)

    Ridsdale, J. E.

    Thompson, Kenneth (Walton)

    TELLERS FOR THE NOES

    Rippon, A. G. F.

    Thorneyoroft, Rt. Hon. P.

    Mr. Richard Thompson and

    Mr. Bryan.

    10.30 p.m.
    Mr. Wade: I beg to move, in page 13, line 24, to leave out "to the like effect" and insert:
    "which would be subject to registration under Part I of this Act, except by permission of the Court".
    I move the Amendment with two objects. The first is to ascertain, if possible, the exact meaning of the words "to the like effect". I think there may be misunderstanding in the interpretation of those words. I suggest that it might be advisable if the Court had reasonable powers to make orders under the Clause. I am thinking of the scope of the Court's order. I am not seeking to lay down any rules about what order the Court shall make.
    Let us consider a case in which the Court has decided that an agreement is contrary to the public interest. It may want to make a further order forbidding the making by the parties of a further agreement designed to have the same effect as the one which the Court has decided against, and designed to defeat the dictation of the Court. It is only reasonable that the Court should be given power to prevent the parties, as soon as they have been ordered to cease to operate an agreement, from entering into another agreement of the same nature. The question is how to define the powers of the Court and the scope of the order which the Court may make.
    I can foresee various possibilities. For example, the parties may enter into an agreement to operate common prices, perhaps to be enforced by some of the methods of enforcement which have been condemned by the Monopolies Commis
    534
    sion. The Court may decide that the agreement is contrary to the public interest. The parties may then get together and find they can achieve the same object by, for instance, some sharing of the market by a zoning arrangement whereby they can achieve the same object as was achieved by the original agreement. It seems reasonable that the Court should at least have power to order that those parties should not enter into a new agreement of that nature.
    The case which I have cited would not, I think, be covered by the words "to the like effect". Some hon. Members may think that I have gone rather too far by the words which I propose as an alternative. I am quite willing to listen to any suggestion which may be made about improving them, any suggestion as to what are the best words to use to achieve the end which I advocate, but I earnestly suggest to the Committee that the words "to the like effect" are open to ambiguity and would tend to restrict unduly the powers of the Court.
    Mr. P. Thorneycroft: I think we all have the same motive, which is simply that when the Restrictive Practices Court has ruled that an agreement or arrangement is, or the restrictions in it are, against the public interest and has made an order, the parties should not go away and do the same thing again, by slightly altering the form of their agreement, but designing it to have the same effect. I use the words in their ordinary connotation, because I think that that is the test which the Court will apply. Whether or not it does have the same effect is a matter which the Court will have to

    535
    judge. I think these are the best words to use.
    I am grateful to the hon. Member for Huddersfield, West (Mr. Wade) for putting down the Amendment. He was right to seek clarification. As he indicated, his words are rather too wide. Their effect would be that if a man had entered into a restrictive arrangement, and it had been outlawed by the Court, an order could be made and he could never enter into any other kind of restrictive arrangement however far removed it was from the one barred by the Court. The Committee will agree, I am sure, that that would be going too wide. What we want to prevent is another agreement with a different appearance but aimed at having the same effect as the barred agreement. That is what the words in the Clause are intended to cover, and I think they do so.
    Sir L. Ungoed-Thomas: The President has made clear that the proposed words would cover a colourable imitation of the forbidden agreement. One of the great difficulties about the Bill is that the parties can go on making agreements ad infinitum, and every agreement that they make will be in order and be enforceable until it is condemned by the Restrictive Practices Court. That is clogging up the register and the Court as much as anything possibly could do.
    At some stage—earlier we suggested a period of 18 months—there ought to be a limit upon the power of the parties to continue indefinitely propagating a species of agreements. The great virtue of the Amendment is that it helps, in an extremely reasonable form, to apply some limit to that appalling process. Once an agreement came before the Court, the Court could say "You have had your whack. No more agreements except by leave of the Court." That seems to avoid the frightful process of continually devising agreements which are colourable imitations designed to achieve the same purpose as the forbidden agreement. The best way to prevent the interminable process of ingenuity to avoid making an agreement falling within the meaning of "the like effect" is to put the matter under the discretion of the Court. I
    536
    hope that the hon. Member for Huddersfield, West (Mr. Wade) will press his Amendment.
    Mr. A. J. Irvine: I support the representations made by my hon. and learned Friend the Member for Leicester, North-East (Sir L. Ungoed-Thomas). I welcome, and am gratified by, the initiative taken by the Liberal Party on the Bill. The Amendment exactly expresses the objective of my hon. Friends and myself. I hope that it will be accepted or divided upon.
    We are dealing with the position reached when the Court has come to the decision that an agreement is contrary to the public interest. I should have thought it was clearly desirable that when that point had been reached the Court should not be troubled any further by the reappearance of the agreement in a mildly varied form. The best way to avoid it is to provide that a new agreement between the parties affected by the decision of the Court shall not be made, if it is registrable, without the Court's permission. The reference of the matter to the discretion of the Court appears to me to be precisely what the situation demands, because if the parties have been told that an agreement arrived at is contrary to the public interest they can go away and between themselves can arrive at another agreement which is registrable. There should be no objection to that, provided that the Court, in its discretion, comes to the conclusion that the registrable agreement is not open to objection as being contrary to the public interest.
    I ask the President, who has shown great consideration to representations made to him from this side of the Committee, to say that he will consider this matter. I take the view that the Amendment of the hon. Member for Huddersfield, West (Mr. Wade) meets the point with precision, and I, and I am sure my hon. Friends, would be well content if the President felt able to say that the Amendment would receive careful consideration before the next stage of the Bill is reached.
    Question put, That the words proposed to be left out stand part of the Clause:—
    The Committee divided: Ayes, 175; Noes, 141.

    Division No. 166.]

    AYES

    [10.40 p.m.

    Agnew, Cmdr. P. G.

    Harris, Frederic (Croydon, N.W.)

    Partridge, E.

    Aitken, W. T.

    Harris, Reader (Heston)

    Pilkington, Capt. R. A.

    Allan, R. A. (Paddingtan, S.)

    Harrison, A. B. C. (Maldon)

    Pitt, Miss E. M.

    Alport, C. J. M.

    Harvey, Air Cdre. A. V. (Macclesfd)

    Pott, H. P.

    Amery, Julian (Preston, N.)

    Heald, Rt. Hon. Sir Lionel

    Powell, J. Enoch

    Armstrong, C. W.

    Heath, Rt. Hon. E. R. G.

    Profumo, J. D.

    Ashton, H.

    Hill, Mrs. E. (Wythenshawe)

    Raikes, Sir Victor

    Baldock, Lt.-Cmdr. J. M.

    Horobin, Sir Ian

    Ramsden, J. E.

    Barber, Anthony

    Howard, John (Test)

    Rawlinson, Peter

    Barlow, Sir John

    Hudson, Sir Austin (Lewisham, N.)

    Redmayne, M.

    Barter, John

    Hughes, Hallett, Vice-Admiral J.

    Rees-Davies, W. R.

    Baxter, Sir Beverley

    Hutchison, Sir James (Scotstoun)

    Renton, D. L. M.

    Bell, Philip (Bolton, E.)

    Iremonger, T. L.

    Ridsdale, J. E.

    Bennett, Dr. Reginald

    Irvine, Bryant Godman (Rye)

    Rippon, A. G. F.

    Bevins, J, R. (Toxteth)

    Jenkins, Robert (Dulwich)

    Roberts, Sir Peter (Heeley)

    Biggs-Davison, J. A.

    Johnson, Dr. Donald (Carlisle)

    Roper, Sir Harold

    Bishop, F. P.

    Johnson, Eric (Blackley)

    Ropner, Col. Sir Leonard

    Body, R. F.

    Joseph, Sir Keith

    Schofield, Lt.-Col. W.

    Boyle, Sir Edward

    Joynson-Hicks, Hon. Sir Lancelot

    Scott-Miller, Cmdr. R.

    Brooke, Rt. Hon. Henry

    Keegan, D.

    Sharpies, R. C.

    Bryan, P.

    Kerby, Capt. H. B.

    Shepherd, William

    Burden, F. F. A.

    Kerr, H. W.

    Simon, J. E. S. (Middlesbrough, W.)

    Butcher, Sir Herbert

    Smithers, Peter (Winchester)

    Cary, Sir Robert

    Kershaw, J. A.

    Speir, R. M.

    Chichester-Clark, R.

    Kimball, M.

    Stanley, Capt. Hon. Richard

    Clarke, Brig. Terence (Portsmth, W.)

    Kirk, P. M.

    Stevens, Geoffrey

    Cole, Norman

    Langford-Holt, J. A.

    Steward, Harold (Stockport, S.)

    Conant, Maj. Sir Roger

    Leather, E. H. C.

    Stewart, Henderson (Fife, E.)

    Cordeaux, Lt.-Col. J. K.

    Leavey, J. A.

    Stoddart-Scott, Col. M.

    Corfield, Capt. F. V.

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

    Studholme, H. G.

    Crosthwaite-Eyre, Col. O. E.

    Legh, Hon. Peter (Petersfield)

    Summers, G. S. (Aylesbury)

    Cunningham, Knox

    Linstead, Sir H. N.

    Taylor, William (Bradford, N.)

    Currie, G. B. H.

    Lloyd, Maj. Sir Guy (Renfrew, E.)

    Teeling, W.

    Dance, J. C. G.

    Longden, Gilbert

    Thompson, Kenneth (Walton)

    D'Avigdor-Goldsmid, Sir Henry

    Lucas-Tooth, Sir Hugh

    Thompson, Lt.-Cdr.R.(Croydon, S.)

    Deedes, W. F.

    Macdonald, Sir Peter

    Thorneycroft, Rt. Hon. P.

    Donaldson, Cmdr. C. E. McA.

    McKibbin, A. J.

    Thornton-Kemsley, C. N.

    Doughty, C. J. A.

    Mackie, J. H. (Galloway)

    Tilney, John (Wavertree)

    Drayson, G. B.

    Maclean, Fitzroy (Lancaster)

    Touche, Sir Gordon

    du Cann, E. D. L.

    McLean, Neil (Inverness)

    Turner, H. F. L.

    Eden, J. B. (Bournemouth, West)

    MacLeod, John (Ross & Cromarty)

    Tweedsmuir, Lady

    Emmet, Hon. Mrs. Evelyn

    Macmillan, Rt. Hn.Harold(Bromley)

    Vane, W. M. F.

    Errington, Sir Eric

    Macpherson, Niall (Dumfries)

    Vaughan-Morgan, J. K.

    Farey-Jones, F. W.

    Maddan, Martin

    Vickers, Miss J. H.

    Finlay, Graeme

    Mathew, R.

    Wakefield, Edward (Derbyshire, W.)

    Fisher, Nigel

    Maude, Angus

    Wakefield, Sir Wavell (St. M'lebone)

    Fleetwood-Hesketh, R. F.

    Mawby, R. L.

    Walker-Smith, D. C.

    Fletcher-Cooke, C.

    Maydon, Lt.-Comdr. S. L. C.

    Wall, Major Patrick

    George, J. C. (Pollok)

    Milligan, Rt. Hon. W. R.

    Ward, Hon. George (Worcester)

    Gibson-Watt, D.

    Morrison, John (Salisbury)

    Ward, Dame Irene (Tynemouth)

    Glover, D.

    Mott-Radclyffe, C. E.

    Waterhouse, Capt. Rt. Hon. C.

    Godber, J. B.

    Nairn, D. L. S.

    Webbe, Sir H.

    Gomme-Duncan, Col. Sir Alan

    Nicolson, N. (B'n'm'th, E. & Chr'ch)

    Whitelaw, W.S.I.(Penrith & Border)

    Grant, W. (Woodside)

    Nield, Basil (Chester)

    Williams, Paul (Sunderland, S.)

    Green, A.

    Oakshott, H. D.

    Wills, G. (Bridgwater)

    Gresham Cooke, R.

    O'Neill, Hn. Phelim(Co. Antrim, N.)

    Wilson, Geoffrey (Truro)

    Grimston, Sir Robert (Westbury)

    Ormsby-Gore, Hon. W. D.

    Grosvenor, Lt.-Col. R. G.

    Osborne, C.

    TELLERS FOR THE AYES:

    Gurden, Harold

    Page, R. G.

    Colonel J. H. Harrison and

    Hall, John (Wycombe)

    Pannell, N. A. (Kirkdale)

    Mr. Hughes-Young.

    NOES

    Ainsley, J. W.

    Champion, A. J.

    Fraser, Thomas (Hamilton)

    Allaun, Frank (Salford, E.)

    Coldrick, W.

    Gibson, C. W.

    Awbery, S. S.

    Collick, P. H. (Birkenhead)

    Grenfell, Rt. Hon. D. R.

    Bacon, Miss Alice

    Corbet, Mrs. Freda

    Grey, C. F.

    Bence, C. R. (Dunbartonshire, E.)

    Craddock, George (Bradford, S.)

    Griffiths, David (Rother Valley)

    Benn, Hn. Wedgwood (Bristol, S.E.)

    Cronin, J. D.

    Griffiths, Rt. Hon. James (Llanelly)

    Benson, G.

    Crossman, R. H. S.

    Griffiths, William (Exchange)

    Beswick, F.

    Cullen, Mrs. A.

    Grimond, J.

    Blackburn, F.

    Dalton, Rt. Hon. H.

    Hale, Leslie

    Blenkinsop, A.

    Deer, G.

    Hannan, W.

    Blyton, W. R.

    Delargy, H. J.

    Hayman, F. H.

    Bottomley, Rt. Hon. A. G.

    Dodds, N. N,

    Herbison, Miss M.

    Bowden, H. W. (Leicester, S.W.)

    Dugdale, Rt. Hn. John (W. Brmwch)

    Hobson, C. R.

    Bowen, E. R. (Cardigan)

    Edwards, Rt. Hon. John (Brighouse)

    Howell, Denis (All Saints)

    Bowles, F. G.

    Edwards, Robert (Bilston)

    Hughes, Cledwyn (Anglesey)

    Boyd, T. C.

    Evans, Stanley (Wednesbury)

    Hughes, Hector (Aberdeen, N.)

    Braddock, Mrs. Elizabeth

    Fernyhough, E.

    Irvine, A. J. (Edge Hill)

    Brookway, A. F.

    Fienburgh, W.

    Irving, S. (Dartford)

    Broughton, Dr. A. D. D.

    Fletcher, Eric

    Jay, Rt. Hon. D. P. T.

    Butler, Herbert (Hackney, C.)

    Forman, J. C.

    Jenkins, Roy (Stechford)

    538

    539

    Johnson, James (Rugby)

    Mulley, F. W.

    Stewart, Michael (Fulham)

    Jones, David (The Hartlepools)

    Neal, Harold (Bolsover)

    Stones, W. (Consett)

    Jones, J. Idwal (Wrexham)

    Oliver, G. H.

    Summerskill, Rt. Hon. E.

    Jones, T. W. (Merioneth)

    Oram, A. E.

    Sylvester, G. O.

    King, Dr. H. M.

    Orbach, M.

    Taylor, Bernard (Mansfield)

    Lawson, G. M.

    Oswald, T.

    Taylor, John (West Lothian)

    Ledger, R. J.

    Paling, Rt. Hon. W. (Dearne Valley)

    Thomas, George (Cardiff)

    Lee, Frederick (Newton)

    Paling, Will T. (Dewsbury)

    Thomson, George (Dundee, E.)

    Lee, Miss Jennie (Cannock)

    Palmer, A. H. F.

    Timmons, J.

    Lever, Leslie (Ardwick)

    Pargiter, G. A.

    Ungoed-Thomas, Sir Lynn

    Logan, D. G.

    Parker, J.

    Usborne, H. C.

    Mabon, Dr. J. Dickson

    Parkin, B. T.

    Warbey, W. N.

    McGhee, H. G.

    Pearson, A.

    Weitzman, D.

    McInnes, J.

    Plummer, Sir Leslie

    Wells, William (Walsall, N.)

    McKay, John (Wallsend)

    Popplewell, E.

    Wheeldon, W. E.

    MacMillan, M. K. (Western Isles)

    Price, J. T. (Westhoughton)

    White, Henry (Derbyshire, N.E.)

    MacPherson, Malcolm (Stirling)

    Price, Philips (Gloucestershire, W.)

    Wilkins, W. A.

    Mabon, Simon

    Probert, A. R.

    Willey, Frederick

    Mallalieu, J. P. W. (Huddersfd, E.)

    Randall, H. E.

    Williams, W. R. (Openshaw)

    Marquand, Rt. Hon. H. A.

    Roberts, Albert (Normanton)

    Willis, Eustace (Edinburgh, E.)

    Mason, Roy

    Robinson, Kenneth (St. Pancras, N.)

    Wilson, Rt. Hon. Harold (Huyton)

    Mikardo, Ian

    Ross, William

    Winterbottom, Richard

    Mitchison, G. R.

    Short, E. W.

    Woof, R. E.

    Monslow, W.

    Silverman, Julius (Aston)

    Yates, V. (Ladywood)

    Moody, A. S.

    Skeffington, A. M.

    Zilliacus, K.

    Morris, Percy (Swansea, W.)

    Slater, Mrs. H. (Stoke, N.)

    Moss, R.

    Slater, J. (Sedgefield)

    TELLERS FOR THE NOES:

    Moyle, A.

    Steele, T.

    Mr. Holt and Mr. Wade.

    Mr. E. Fletcher: I beg to move in page 13, line 24, at the end to insert:
    (3) When any such restrictions are determined by the Court not to be contrary to the public interest provided the Agreement containing such restrictions is operated subject to certain safeguards and provisions desired to ensure the protection of persons whose interests might be prejudicially affected by such restrictions, the Court shall make an Order under the preceding subsection hereof subject to such undertakings as the Court may think fit to impose, or such other Order as the Court may think fit.
    I hope that it will not take many words of mine to persuade the President that this is a reasonable Amendment for him to accept. It is designed to help in the working of this procedure. The object of the Amendment is to enable the Court, if it comes to the conclusion that a particular agreement could be approved, provided certain modifications are made or certain undertakings are given, to say so. Experience in America under the antitrust laws has shown that parties are often willing to agree to a consent decree in order to avoid the expense and trouble of litigation. Undoubtedly much the same situation will arise in this country.
    As the President has recognised, there will be a number of cases in which in the earlier stages, the parties will appreciate that provided certain undertakings are given or certain modifications are made and objectionable clauses are cut out of an agreement, it would otherwise be acceptable and approved by the Court as not being contrary to the public interest. To enable that to be done is the object of the Amendment, and I hope that the
    540
    President will accept it. I hope he will not say that it is unnecessary.
    I appreciate that subsection (3) of the Clause enables the parties, after proceedings have begun, to modify an agreement, but I do not think that that goes far enough because there may be various other agreements which will be affected by proceedings, and it will frequently arise that the most convenient method for the approving of an agreement by the Court will be by making approval subject to specific undertakings being given by the parties to the agreement, or to the offending section being cut out and removed or perhaps not being operated and enforced. To enable that to be done is the object of this amendment, and I think it would be welcomed not only on this side of the Committee but by all those traders and members of business communities and companies who will be affected by the Bill. I hope, therefore, that it will be accepted.
    Mr. P. Thorneycroft: I agree with what the hon. Gentleman the Member for Islington, East (Mr. E. Fletcher) has said, and I think that the whole Committee will also agree. It is true that in a great number of countries where this type of legislation operates the consent judgment is a very useful way of dealing with the matter. It may well emerge, during the hearing, that perhaps the arrangement is acceptable, provided that parts of it are modified or certain safeguards are introduced. If it were not for the fact that I am absolutely satisfied that the Bill as it stands covers that com

    541
    pletely, I would consider adopting the Amendment. I am absolutely satisfied, however, that under the Bill, the agreement can be modified or varied, and approved as modified or varied, with or without more undertakings, and the old agreement which, in the form in which it was against the public interest, has been abandoned or modified, can itself, if necessary, be banned by the Court, and only the new agreement approved. That is absolutely clear, but I am grateful to the hon. Gentleman for moving his Amendment, because I am entirely in sympathy with the policy that he puts forward.
    Mr. Jay: Even if the right hon. Gentleman is himself perfectly satisfied that the Bill as it stands would have exactly the same effect as if it were amended in the manner suggested, could he tell us whether the situation, from his point of view, would be made any different if he accepted the Amendment? Might the position not then be clarified in the minds of others who have had some doubts, and might not the position, from the right hon. Gentleman's point of view, be exactly the same? If that is so, is there any objection to accepting the Amendment?
    Mr. Thorneycroft: I say this in no criticism of the hon. Member for Islington, East, who addresses himself to the Bill in debate with great skill, but drafting is a difficult business, and to get things in the shortest, most concise and clearest way, and in the way least liable to misinterpretation in the courts afterwards, is a difficult and technical task. I am satisfied that there is complete agreement on policy between the two sides of the Committee, and I hope that the hon. Member will have confidence that we have done the drafting in a way which is best calculated to carry out the intention which we share.
    Sir L. Ungoed-Thomas: I appreciate that we are in agreement on the objectives we have in mind and I have great respect for the Parliamentary draftsmen, but it is desirable not only that Bills should be watertight but also that their meaning should be obvious to people who read them. I am not attacking the drafting of the Bill as a whole; I think it is admirably drafted. It has been a very difficult Bill to draft, and it has been admirably drafted. But it is most desir
    542
    able that it should be perfectly clear not only to barristers and solicitors but also to businessmen; they should get the right impression of what the Bill affects.
    I was by no means convinced, and am still not convinced, despite what the President has said—although I accept from him the statement which he made, with the authority of the Parliamentary draftsmen—that the point is covered by the Bill. In any event, it does not do what legislation should do—make perfectly clear to the man who has to use the Bill what is affected by the Bill. That it certainly does not do.
    I presume that the right hon. Gentleman is relying on the words in subsection (3). I was a little puzzled about the exact object of that subsection. I thought it was to prevent people from escaping the consequences of the Bill by some variation made afterwards, and I now gather from the President that it does that, too. The Parliamentary draftsman is killing two birds with one stone. The difficulty is that when that happens it is apt to lead to confusion in ordinary minds like my own.
    It would be much clearer to those who have to work the Bill if they could see in precise terms exactly what it achieves. When one imagines that subsection (3) achieves one objective and is then told that it achieves another very different objective at the same time, the position becomes confusing.
    The objection is that which is so often made from both sides of the House to Bills which come before us—that it is not clear to the person who has to work the Bill what exactly is achieved by it. One has only to read the extensive and easily accessible observations of various judges on various Acts from time to time to know that even the most astute Parliamentary draftsman cannot be entirely free from criticism. I am glad that we are at one on the intention here, but the Clause is certainly not satisfactory as it stands for the purpose of ordinary day-to-day work.
    Mr. E. Fletcher: I feel that I must ask my hon. Friends to press the Amendment to a Division. I appreciate what the President has said, but I feel that there is doubt on this point.
    If the President looks at the scope of the Clause he will find that, whereas subsection (2) enables the Court to deal with

    543
    certain things when it finds that an agreement is contrary to the public interest, we are here concerned with the hypothetical case in which we want the Court to declare that a particular agreement, subject to certain undertakings or conditions, is not contrary to the public interest.
    If the President has any doubt on the matter, may I draw his attention to a circular I have received, and which probably he has received, since I put this Amendment down? It is a circular sent out by the Federation of British Industries, the Association of British Chambers of Commerce and the National Union of Manufacturers. Obviously they are in doubt, because their comment is:
    "Provision should be made in the interests of all concerned whereby the parties could modify their agreement during the proceedings and the Court approve them in their new form. This would speed the procedure and reduce the expense. It is believed that Clause 15 is intended to cover this point, but the doubt should be removed."
    That is what I am proposing and, if the President is not prepared to accept that, I must press the matter to a Division.
    Mr. Thorneycroft: I cannot press hon. Members not to divide, but I hope that what I have said has removed any doubt whatever.
    Question put, That those words be there inserted:—
    The Committee divided: Ayes 133, Noes 174.

    Division No. 167.]

    AYES

    [11.1 p.m.

    Ainsley, J. W.

    Hale, Leslie

    Paling, Will T. (Dewsbury)

    Allaun, Frank (Salford, E.)

    Hannan, W.

    Palmer, A. M. F.

    Awbery, S. S.

    Hayman, F. H.

    Pargiter, G. A.

    Bacon, Miss Alice

    Herbison, Miss M.

    Parker, J.

    Bence, C. R. (Dunbartonshire, E.)

    Hobson, C. R.

    Parkin, B. T.

    Benn, Hn. Wedgwood (Bristol, S.E.)

    Howell, Denis (All Saints)

    Pearson, A.

    Benson, G.

    Hughes, Cledwyn (Anglesey)

    Plummer, Sir Leslie

    Blackburn, F.

    Hughes, Hector (Aberdeen, N.)

    Popplewell, E.

    Blenkinsop, A.

    Irvine, A. J. (Edge Hill)

    Price, Philips (Gloucestershire, W.)

    Blyton, W. R.

    Irving, S. (Dartford)

    Probert, A. R.

    Bottomley, Rt. Hon. A. G.

    Jay, Rt. Hon. D. P. T.

    Randall, H. E.

    Bowden, H. W. (Leicester, S.W.)

    Jenkins, Roy (Stechford)

    Roberts, Albert (Normanton)

    Bowles, F. G.

    Johnson, James (Rugby)

    Robinson, Kenneth,(St. Pancras, N.)

    Boyd, T. C.

    Jones, David (The Hartlepools)

    Ross, William

    Braddock, Mrs. Elizabeth

    Jones, J. Idwal (Wrexham)

    Short, E. W.

    Brockway, A. F.

    Jones, T. W. (Merioneth)

    Silverman, Julius (Aston)

    Broughton, Dr. A. D. D.

    King, Dr. H. M.

    Skeffington, A. M.

    Butler, Herbert (Hackney, C.)

    Lawson, G. M.

    Slater, Mrs. H. (Stoke, N.)

    Champion, A. J.

    Ledger, R. J.

    Slater, J. (Sedgefield)

    Coldrick, W.

    Lee, Frederick (Newton)

    Steele, T.

    Collick, P. H. (Birkenhead)

    Lee, Miss Jennie (Cannock)

    Stewart, Michael (Fulham)

    Corbet, Mrs. Freda

    Lever, Leslie (Ardwick)

    Stones, W. (Consett)

    Craddock, George (Bradford, S.)

    Logan, D. G.

    Summerskill, Rt. Hon. E.

    Cronin, J. D.

    Mabon, Dr. J. Dickson

    Sylvester, G. O.

    Crossman, R. H. S.

    McGhee, H. G.

    Taylor, Bernard (Mansfield)

    Cullen, Mrs. A.

    McInnes, J.

    Taylor, John (West Lothian)

    Dalton, Rt. Hon. H.

    MacMillan, M. K. (Western Isles)

    Thomas, George (Cardiff)

    Deer, G.

    Mahon, Simon

    Timmons, J.

    Delargy, H. J.

    Mallalieu, J. P. W. (Huddersfd, E.)

    Ungoed-Thomas, Sir Lynn

    Dodds, N. N.

    Marquand, Rt. Hon. H. A.

    Usborne, H. C.

    Dugdale, Rt. Hn. John (W. Brmwch)

    Mason, Roy

    Warbey, W. N.

    Edwards, Rt. Hon. John (Brighouse)

    Mikardo, Ian

    Weitzman, D.

    Edwards, Robert (Bilston)

    Mitchison, G. R.

    Wells, William (Walsall, N.)

    Evans, Stanley (Wednesbury)

    Monslow, W.

    Wheeldon, W. E.

    Fernyhough, E.

    Moody, A. S.

    White, Henry (Derbyshire, N.E.)

    Fienburgh, W.

    Morris, Percy (Swansea, W.)

    Willey, Frederick

    Fletcher, Eric

    Moss, R.

    Williams, W. R. (Openshaw)

    Willis, Eustace (Edinburgh, E.)

    Forman, J. C.

    Moyle, A.

    Wilson, Rt. Hon. Harold (Huyon)

    Fraser, Thomas (Hamilton)

    Mulley, F. W.

    Winterbottom, Richard

    Gibson, C. W.

    Neal, Harold (Bolsover)

    Woof, R. E.

    Grenfell, Rt. Hon. D. R.

    Oliver, G. H.

    Yates, V. (Ladywood)

    Grey, C. F.

    Oram, A. E.

    Zilliacus, K.

    Griffiths, David (Rother Valley)

    Or bach, M.

    Griffiths, Rt. Hon. James (Llanelly)

    Oswald, T.

    TELLERS FOR THE AYES:

    Griffiths, William (Exchange)

    Paling, Rt. Hn. W. (Dearne Valley)

    Mr. J. T. Price and Mr. Wilkins.

    NOES

    Agnew, Cmdr. P. G.

    Baldock, Lt.-Cmdr. J. M.

    Bevins, J. R. (Toxteth)

    Aitken, W. T.

    Barber, Anthony

    Biggs-Davison, J. A.

    Allan, R. A. (Paddington, S.)

    Barlow, Sir John

    Bishop, F. P.

    Alport, C. J. M.

    Barter, John

    Body, R. F.

    Amery, Julian (Preston, N.)

    Baxter, Sir Beverley

    Bowen, E. R. (Cardigan)

    Armstrong, C. W.

    Bell, Philip (Bolton, E.)

    Boyle, Sir Edward

    Ashton, H.

    Bennett, Dr. Reginald

    Brooke, Rt. Hon. Henry

    Bryan, P.

    Hughes Hallett, Vice-Admiral J.

    Ramsden, J. E.

    Burden, F. F. A.

    Hughes-Young, M. H. C.

    Rawlinson, Peter

    Butcher, Sir Herbert

    Hutchison, Sir James (Scotstoun)

    Redmayne, M.

    Cary, Sir Robert

    Iremonger, T. L.

    Rees-Davies, W. R.

    Chichester-Clark, R.

    Irvine, Bryant Godman (Rye)

    Renton, D. L. M.

    Clarke, Brig. Terence (Portsmth, W.)

    Jenkins, Robert (Dulwich)

    Ridsdale, J. E.

    Cole, Norman

    Johnson, Dr. Donald (Carlisle)

    Rippon, A. G. F.

    Conant, Maj. Sir Roger

    Johnson, Eric (Blackley)

    Roberts, Sir Peter (Heeley)

    Cordeaux, Lt.-Col. J. K.

    Joseph, Sir Keith

    Ropner, Col. Sir Leonard

    Corfield, Capt. F. V.

    Joynson-Hicks, Hon. Sir Lancelot

    Schofield, Lt.-Col. W.

    Crosthwaite-Eyre, Col. O. E.

    Keegan, D.

    Scott-Miller, Cmdr. R.

    Cunningham, Knox

    Kerby, Capt. H. B.

    Sharpies, R. C.

    Currie, G. B. H.

    Kerr, H. W.

    Shepherd, William

    Dance, J. C. G.

    Kershaw, J. A.

    Simon, J. E. S. (Middlesbrough, W.)

    D'Avigdor-Goldsmid, Sir Henry

    Kimball, M.

    Smithers, Peter (Winchester)

    Deedes, W. F.

    Kirk, p. M.

    Speir, R. M.

    Donaldson, Cmdr. C. E. McA.

    Langford-Holt, J. A.

    Stanley, Capt. Hon. Richard

    Doughty, C. J. A.

    Leavey, J. A.

    Stevens, Geoffrey

    Drayson, G. B.

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

    Steward, Harold (Stockport, S.)

    du Cann, E. D. L.

    Legh, Hon. Peter (Peterfield)

    Stewart, Henderson (Fife, E.)

    Eden, J. B. (Bournemouth, West)

    Linstead, Sir H. N.

    Stoddart-Scott, Col. M.

    Emmet, Hon. Mrs. Evelyn

    Lloyd, Maj. Sir Guy (Renfrew, E.)

    Studholme, H. G.

    Errington, Sir Erie

    Longden, Gilbert

    Summers, G. S. (Aylesbury)

    Farey-Jones, F. W.

    Lucas-Tooth, Sir Hugh

    Taylor, William (Bradford, N.)

    Finlay, Graeme

    Macdonald, Sir Peter

    Teeling, W.

    Fisher, Nigel

    McKibbin, A. J.

    Thompson, Kenneth (Walton)

    Fleetwood-Hesketh, R. F.

    Mackie, J. H. (Galloway)

    Thompson, Lt.-Cdr.R.(Croydon, S.)

    Fletcher-Cooke, C.

    Maclean, Fitzroy (Lancaster)

    Thorneycroft, Rt. Hon. P.

    George, J. C. (Pollok)

    McLean, Neil (Inverness)

    Thornton-Kemsley, C. N.

    Gibson-Watt, D.

    MacLeod, John (Ross & Cromarty)

    Tilney, John (Wavertree)

    Glover, D.

    Macmillan, Rt. Hn. Harold (Bromley)

    Touche, Sir Charles

    Gomme-Duncan, Col. Sir Alan

    Maddan, Martin

    Turner, H. F. L.

    Grant, W. (Woodside)

    Mathew, R.

    Tweedsmuir, Lady

    Green, A.

    Maude, Angus

    Vane, W. M. F.

    Gresham Cooke, R.

    Mawby, R. L.

    Vaughan-Morgan, J. K.

    Grimond, J.

    Maydon, Lt.-Comdr. S. L. C.

    Vickers, Miss J. H.

    Grimston, Sir Robert (Westbury)

    Milligan, Rt. Hon. W. R.

    Wade, D. W.

    Grosvenor, Lt.-Col. R. G.

    Morrison, John (Salisbury)

    Wakefield, Edward (Derbyshire, W.)

    burden, Harold

    Mott-Radclyffe, C. E.

    Wakefield, Sir Wavell (St. M'lebone)

    Hall, John (Wycombe)

    Nairn, D. L. S.

    Walker-Smith, D. C.

    Harris, Frederic (Croydon, N.W.)

    Nicolson, N. (B'n'm'th & Chr'ch)

    Wall, Major Patrick

    Harris, Reader (Heston)

    Nield, Basil (Chester)

    Ward, Hon. George (Worcester)

    Harrison, A. B. C. (Maldon)

    Ormsby-Gore, Hon. W. D.

    Ward, Dame Irene (Tynemouth)

    Harrison, Col. J. H. (Eye)

    Osborne, C.

    Waterhouse, Capt. Rt. Hon. C.

    Harvey, Air Cdre. A. V. (Macclesfd)

    Page, R. G.

    Webbe, Sir H.

    Heald, Rt. Hon. Sir Lionel

    Pannell, N. A. (Kirkdale)

    Whitelaw, W.S.I.(Penrith & Border)

    Heath, Rt. Hon. E. R. G.

    Partridge, E.

    Williams, Paul (Sunderland, S.)

    Hill, Mrs. E. (Wythenshawe)

    Pilkington, Capt. R. A.

    Wills, G. (Bridgwater)

    Holt, A. F.

    Pitt, Miss E. M.

    Wilson, Geoffrey (Truro)

    Horobin, Sir Ian

    Pott, H. P.

    Howard, John (Test)

    Powell, J. Enoch

    TELLERS FOR THE NOES:

    Hudson, Sir Austin (Lewisham, N.)

    Raikes, Sir Victor

    Mr. Oakshott and Mr. Godber

    Question put and agreed to.

    Mr. R. Gresham Cooke: I beg to move, in page 13, line 24, at the end to insert:
    (3) Where any such restrictions are determined by the court not to be contrary to the public interest the court shall make an order to that effect and the agreement shall be enforceable by civil proceedings as between any party thereto.
    The Chairman: I suggest that this Amendment might be discussed together with the last Amendment to the Clause, in the name of the hon. Member for Heston and Isleworth (Mr. R. Harris), in page 13, line 29, at the end to add:
    (5) Paragraph (1) of section four of the Trade Union Act, 1871 (which prohibits any court entertaining proceedings to enforce certain agreements), shall not apply to any proceedings to enforce any agreement to which this Act applies and which is not declared by an Order of the Restrictive Practices Court for the time being in force to be contrary to the public interest.
    Mr. Gresham Cooke: Yes, Sir Charles.

    There has been a good deal of discussion tonight about the enforcement of restrictive agreements. The object of the Amendment is to lift that enforcement out of the realm of stop lists, fines and secret courts into the clear air of the courts of the land. We have heard a good deal during our debates in Committee about the agreements and arrangements that will not be approved by the Restrictive Practices Court, but we must face the fact that there will be a number of agreements of a quite innocuous character that will be approved by the Court as being in the public interest. The question will then arise of how these agreements will be enforced, whether by stop lists, fines or any other means.
    One of the difficulties that has faced anybody who has had anything to do with

    547
    these restrictive arrangements is that, strangely enough, they cannot be enforced in the courts of the land because of the Trade Union Acts. Under Section 16 of the Trade Union Act, 1876, any combination for imposing restrictive conditions on the conduct of any trade or business becomes a trade union. Whether employers or others who are working this arrangement are aware of it or not, their restrictive action becomes a trade union.
    Then, under the Trade Union Act, 1871, Section 4, it is laid down that nothing in that Act shall enable any court to entertain any legal proceedings for the breach of any agreement by the members of a trade union as such concerning the conditions on which members shall or shall not sell their goods. That is why over the years, the secret courts and the rest have been developed. Not being allowed to go to the courts of the land, industries and trades have had to build up their own courts. The reason why they have been secret, as has been said, is that they have received no privilege. The statements made in the courts are not privileged and the members of the courts can be sued for libel. That is why they cannot admit the Press. We therefore come to the conclusion that members of a combination cannot sue other members in the courts of the land, although many of the agreements which they have entered into are perfectly lawful and, I believe, quite innocuous.
    Let me give an example. Makers of electric fires might agree together that for the purpose of public safety, bars should be placed in front of electric fires to prevent children from falling into them. That might be an arrangement entered into by all the makers of electric fires. Imposed on the trade, it would become a restrictive arrangement.
    Another example, about which I know a little more, is that in the motor trade there is an arrangement known as the distribution scheme, by which garages which enter the trade are required to have certain minimum qualifications in the repair service they offer to the public. They must have a certain amount of workship space and a £50 stock of spare parts; they must have two qualified mechanics, at least one of whom must be certificated or a skilled craftsman under the terms of the national wages agreement, and they must also have certain tools and equip
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    ment, suitable lifting jacks, equipment for chassis repairs etc.
    That kind of arrangement will obviously have to come before the Restrictive Practices Court; and if, as I believe, it is in the public interest generally that repair garages should have the proper facilities for the public, the question will arise as to how the 8,000 garages and repairers up and down the country, in the situation which will have been brought about, can keep these facilities going. At present the ultimate sanction on them if they drop below that standard is a fine, or they may be put on the stop list.
    11.15 p.m.
    I am suggesting here, and I think that I have the support of some of my hon. Friends, that in order to enforce these innocuous agreements which get through the Restrictive Practices Court, members of such arrangements ought to be able to go to the courts of the land. It would make these innocuous restrictive practices much more practical; it would make the Bill more practicable. Therefore I think that the Amendment which I propose is desirable. I ask the President of the Board of Trade to accept it.
    Mr. R. Harris: The Amendment is being discussed with the later Amendment in my name, in page 13, line 29. It is an Amendment which I do not intend to press. I put it down because, as stated earlier this evening, it is I consider, necessary that if the Court approves any of the agreements there shall be power to enforce them. It would make nonsense of the Bill if there were power to approve agreements, but no method of enforcing them. There are two ways to enforce them, either through ordinary courts of the land or through the so-called secret courts. I am not particularly concerned which way it is done.
    The reason we suggest enforcement through the courts is because we recognise that the so-called secret courts are unpopular. Much of the criticism levelled against them is unjustified. At any rate, in the courts with which I have had any connection, every conceivable attempt has been made to ensure that they are fair and just. The only reason they were set up was that the people affected might have some opportunity to make representations against any decision, rather than that the decision should be taken by an executive of a particular

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    firm sitting in his office, against whose decision there might be no appeal.
    That would really be a secret decision, because the ground for the decision would not be known. These courts have been described as bad, but I think that that is unjust; because they were set up to ensure that justice was done, and that it was seen to be done, so far as it was permissible for it to be seen to be done. It is difficult to enable people to see justice being done if there is the possibility of a libel action at the end of it. As has been made clear by the Motor Trade Association on more than one occasion, the defendants in these cases are usually keen that there shall be no publicity.
    There is no doubt that secret courts, if I may call them such, or private courts, will continue where agreements do not concern retail prices. If we could have had the enforcement of these agreements carried out through the courts it would have been a good thing. On the other hand, I recognise that for enforcement to be carried out by trade associations it would be necessary to pass an Amendment, such as that in my name which would disapply Sections 1 to 4 of the Trade Union Act of 1871, which precludes trade unions taking action against members, and the relevant Section of the 1906 Act.
    If that is going too wide, and it is desired that we should not disapply the Trade Union Act—[interruption]—The Trade Disputes Act of 1906 has been disapplied in one respect, in Clause 20. I think it a quite simple word. All it means is that a provision is not applied any longer. Then it will be possible for a trade association to bring actions against its members, if necessary. However, if that would raise the whole question of the legislation relating to trade unions, and the rights of trade unions to sue or to be sued, I am quite willing not to press my Amendment, so long as it is clear that there will be power in a trade association or other body to enforce an agreement which has had the approval of the Court.
    Mr. A. J. Irvine: These are interesting, but dangerous Amendments. I should not think that my own views of what was in the public interest in this matter were entirely disparate from the views of the hon. Member for Twickenham (Mr.
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    Gresham Cooke). I am not entering into the "disapplication" controversy, which is of secondary importance and a less agreeable subject; but I would accept that in this matter the conception of the public interest held by the hon. Member for Twickenham and that held by myself would be, as I say, not dissimilar.
    However, what he is doing by the Amendment is bringing forward in the garb of civil liberties the most cadaverous animal the Committee has seen during its discussions. I would make one point to the Committee in particular. We could have a secret court, and an agreement providing for a stop list and a secret court, held by the Restrictive Practices Court to be contrary to the public interest. The agreement setting up that stop list and constituting that secret court could be held to be a registrable agreement contrary to the public interest, and that having been decided, many agreements entered into by the members of the trade association which had constituted the secret court would be, under the law of the land as it is at present, not enforceable.
    One effect of the Amendment, as I understand—this is one of the many results that could ensue—would be that when the agreement entered into by the trade association and creating and constituting a secret court and stop list had thus been held to be contrary to the public interest, that would not prevent a separate ancillary agreement entered into by members of the association being held to be not contrary to the public interest. Without this Amendment such an ancillary agreement would not be enforceable at law. The Amendment makes it enforceable.
    Mr. Gresham Cooke: The object of my Amendment is to get rid of the means of enforcement, the stop list, and so on, to which the hon. Gentleman is referring. What I said was that any such restrictions determined by the Court not to be contrary to the public interest—in other words, which are allowed as being in the public interest—should be enforceable in the ordinary courts.
    Mr. Irvine: I appreciate that that is what the hon. Member said his purpose was. The point I am making is that there may be an agreement arrived at which is determined by the Court not to be contrary to the public interest, and, as

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    things are now under the existing law, that agreement can be enforced only by reference to a secret court and a stop list. Once that secret court and stop list procedure is determined by the Court to be contrary to the public interest that same agreement would not be enforceable. That is right, is it not?
    Therefore, the proposition which I make to the Committee is that if we have an agreement which is arrived at between parties and which the Restrictive Practices Court holds not to be contrary to the public interest, it should not be made possible for that agreement to be rendered enforceable in a way in which it is not enforceable now. It may be that the Restrictive Practices Court will have determined that the secret court and the processes of the stop list are not in accordance with the public interest and should not continue. The enforceability of the ancillary agreements should cease when the secret court ceases.
    I do not expect the Amendment to be acceptable to the President. Again and again he has protected us from the animadversions and persuasions of his hon. Friends, and we look to him to do it again. The right hon. Gentleman does not like the Amendment any more than we do, and in recognition of that we are sure that he will not accept it.
    Mr. Jay: I hope that the President will not accept the Amendment. The hon. Member for Twickenham (Mr. Gresham Cooke) moved it very plausibly. I have known him for many years, and he always puts his point of view plausibly. No doubt the suggestion is genuinely intended to get rid of secret courts and to substitute respectable legal procedure, but the difficulty that we see about it is as follows.
    The hon. Gentleman's Amendment rightly begins by saying:
    "Where any such restrictions are determined by the court not to be contrary to the public interest …"
    It does not say "where they are determined to be in the public interest". This is a clear and material distinction. Under the provisions of Clauses 15 and 16, the Bill considers whether an agreement shall be deemed to be contrary to the public interest, and, if it passes the test, all that has happened is that it is not deemed to be contrary to the public interest. It does not mean that
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    it has been found to be substantially or even materially in the public interest. It does not seem to us to follow that, just because it has not been found to be objectionable, it is clearly and materially in the public interest that it should be enforceable at law.
    There are all sorts of agreements that we make in all walks of life, in private societies and associations, and so on, which are in no way contrary to the public interest, which are perfectly innocuous and blameless, but we do not suggest that they ought to be enforceable at law and given the force of law. That is what the hon. Gentleman is arguing.
    In several places in its Report the Commission argued that, while it might be that certain agreements and practices might be innocuous and there might be no serious objection to them, it did not think that it ought to be possible to enforce them on parties who did not wish to carry them out. The Commission's view was that, in those circumstances, if the agreement was desirable, the parties which wished to carry it out should do so, but there was no reason why there should be any enforcement on unwilling parties either by economic boycott or by invoking the law.
    In these circumstances, we think that, even though it has been found that the practice is not contrary to the public interest, it is going too far to suggest that the whole machinery of the law should automatically be invoked to this effect.
    11.30 p.m.
    Mr. P. Thorneycroft: My hon. Friends the Members for Twickenham (Mr. Gresham Cooke) and Heston and Isle-worth (Mr. R. Harris) intimated that they moved and supported the Amendments to point a moral, and it is quite a good one to follow; namely, that these private court enforcement methods are there because in the development of the law of this country there is no other kind of enforcement. That is something which I think is too little understood, and it is useful that Amendments should be put down to show it. They suggest that the best way out of this difficulty might be by abolishing these various private arrangements for enforcement and substituting the right of legal enforcement in the courts.

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    It is an argument which might be expected to appeal to me, because at a later stage of the Bill, and on a very much narrower front and having a very different context, I shall show that we rely on individual rights of enforcement through the courts. This goes very much further and deals with a whole range of restrictive arrangements many of which would be quite irrelevant to the courts; such as whether there should be an after-sales service, or whether there should be exclusive dealing with a particular range of people to preserve the safety of the public.
    These are difficult things, in any event, to refer to a court. They are much better dealt with, if approved, by various private arrangements. Moreover, in the case of a common price ring it often happens that there are no enforcement methods at all. To invoke or import into the Bill words whereby, though the court ruled that a common price ring was not contrary to the public interest, yet automatically each individual member had the right of action against another individual member who sold below the price, would be to fortify these restrictive arrangements. While I appreciate the intent of my hon. Friends, I hope that we shall be able to leave the Bill in its present form.
    Mr. Gresham Cooke: I am, of course, disappointed that the President is not able to accept my Amendment, as I consider that it might have improved the Bill. I used the words
    "not to be contrary to the public interest"
    because they were opposite to the words
    "contrary to the public interest"
    in Clause 15 (2). But I appreciate what has been said by the President, that this Amendment, if accepted, might have to go a great deal further than I had envisaged, and that there might be difficulty in bringing it into the Bill. I therefore beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Clause, as amended, ordered to stand part of the Bill.
    To report Progress, and ask leave to sit again.—[Mr. P. Thorneycroft.]
    Committee report Progress; to sit again Tomorrow.

  RURAL ELECTRIFICATION
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Galbraith.]
  11.33 p.m.
  Mr. Cledwyn Hughes: I shall endeavour to be reasonably brief, but I think I am justified, by reason of its importance, in raising even at this late hour the question of rural electrification. There is general agreement with the proposition that the introduction of modern amenities to our countryside is a matter of urgent necessity. They are needed for several reasons. They help to stop the drift from the land and to stimulate agricultural production. Moreover, we all agree that country folk have a right to them. Why should the country housewife, for example, have to struggle along as many still do, in cramped cottages, often damp, without sanitation, without a piped water supply and with a paraffin lamp for lighting?
  Recent years have brought a growing realisation that some urgent action is needed. In some directions substantial progress has as already been made. In some areas in the task of bringing electricity to the countryside progress has been spectacular by comparison with the inaction of the pre-war years. This is as it should be, because of all amenities electricity is the greatest single factor in arresting the drift of population from the countryside.
  I said that progress in this field had been spectacular. During the first six years of nationalisation, the area electricity boards took electricity to 400,000 rural premises, including 60,000 farms. That was a considerable achievement and a complete vindication of the policy of the Labour Government, which nationalised the industry and also included, in the Electricity Act, 1947, the injunction that supplies were to be extended to the rural areas.
  The number of farms connected on vesting day, on 1st April, 1948, was 90,374. By 31st March, 1955, the last date for which figures are available, the figure was 167,375, a remarkable increase. In percentage terms, it is an increase from 32·3 per cent. to 59·9 per cent. of all the farms in the country. The last Report of

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  the Central Electricity Authority, in which these figures are to be found, indicates that smaller farms represent a high proportion of the substantial increase in the number of farms connected.
  That is very significant, because it illustrates that the criterion is no longer the farmer's ability to find a large sum of money to pay for the scheme. In Wales, as the Parliamentary Secretary will be aware, the position was always rather more serious than it was elsewhere. For example, on 1st April, 1948, the percentage of farms connected in South Wales was 14·4, an appallingly low figure, and in the Merseyside and North Wales area the figure was 26·4 per cent.
  Here, there was obviously a tremendous backlog to be made up. By 31st March, 1955, the figure for South Wales was 32·2 per cent. and for the Merseyside and North Wales area 46·1 per cent. A great advance was made between vesting day and 1955, but these two areas still have the lowest figures in the country. Rural Wales is an area where depopulation is causing the gravest concern. I believe that if necessary special assistance should be given to areas where the figures are very low and the need is most acute.
  The Parliamentary Secretary to the Ministry of Fuel and Power (Mr. David Renton): I wonder whether the hon. Gentleman could explain what he means by "special assistance" in this context?
  Mr. Hughes: Certainly. For example, there are areas in England where a very high percentage of farms and rural premises are connected to a supply of electricity—figures as high as 79 per cent.—but in South Wales the figure is as low as 32 per cent. Where economy cuts are to be made, my argument is that the disparity between the high and the low figures should be taken into account and a proportionately larger capital allocation should be made to the areas where a comparatively small number of farms are connected to an electricity supply.
  I now turn to the autumn Budget and the Chancellor's statement, in which, the House will recall, he called for overall percentage cuts in the capital expenditure of the nationalised industries. His instructions have been implicitly obeyed, but
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  we have been told by the Minister of Fuel and Power that reduction in the electricity supply will fall on generation and not on distribution. My concern—and this is, I think, very widely shared—is that rural electrification schemes will suffer substantially. I have some evidence that they will and I shall be glad to have an assurance to the contrary from the Parliamentary Secretary.
  The Farmer and Stock Breeder of 4th October, 1955, quotes Lord Citrine, the Chairman of the Central Electricity Authority, as saying:
  "Plans for rural electrification have been slowed down by the credit squeeze. Efforts have been made to cut capital costs of distribution by about 10 per cent. and local boards are feeling the effects. Nevertheless, it is hoped that the number of farms connected will not fall far below the yearly average of 12,000."
  Then we read in The Times of 22nd February, 1956:
  "Although some 500 fewer farms will be connected to the electricity supply in 1956–57 than had been planned, it is expected that when the programme of connecting 60,000 farms in five years ends in 1958, the target will be reached and may even be exceeded."
  This information was contained in a letter which the Minister of Fuel and Power sent to the hon. and gallant Member for South Angus (Captain Duncan). These statements cause us to think, because this figure is a substantial drop from the number connected in 1955, which, as the Parliamentary Secretary knows, was 14,796. I am not happy at all about the overall position, in spite of the assurances that we have had from time to time in Parliamentary replies from the Minister.
  The evidence I have received from my own county, Anglesey, for example, where the figures of connections in rural districts were very low indeed in 1948, and where satisfactory progress has been made since, is that there has been a considerably slowing down since the Chancellor made his autumn Budget statement. The Parish Council of Llangeinwen, in Anglesey, was informed some months ago that work on the electrification of the village of Dwyran and the surrounding district would be begun in April of this year.
  Then the Clerk of the Council received a letter from the Board on 14th March, 1956—and this is the sort of evidence on

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  which I am relying in the case I am making. The Board states:
  "I would inform you that we do not know to what extent our programme will be affected by the Government's restriction on capital expenditure, and at this stage it is practically impossible for us to gauge its influence on individual projects or particular areas. Our programme must therefore be regarded as subject to change to meet the national situation. I am sorry that because of this I am unable to be specific about construction dates."
  Mr. Renton: What is the date of that letter?
  Mr. Hughes: It is 14th March, 1956.
  It is, therefore, clear that, to put it at its lowest, the Board is uncertain of the position. I understand from inquiries which I have made that there will be a slowing down of at least 12 months in the rural electrification schemes in my area. I submit that if the same is true of the whole of the rural areas of the country there will be a substantial slowing down.
  I understand, too—and I should like the Parliamentary Secretary either to confirm or deny this—that since the Chancellor made his statement there has been no overtime working in any of the areas throughout the country. If that is true, it means a very substantial curtailment of work. It is clear that a severe brake has been applied to the Boards' programmes.
  In the statements which he has made, the Minister has given figures of farms alone. What is the position in relation to rural premises as a whole? The House knows that the schemes of the area boards include villages, hamlets and private houses as well as farms, and it is impossible to know to what extent there is a curtailment without having the overall figures, including all types of rural houses and premises. Rural electrification has been accepted by this Government, as well as by the last Government, as a national problem, and the House and the country are entitled to know exactly how progress in this field is being influenced by the Government's economic policy.
  11.47 p.m.
  The Parliamentary Secretary to the Ministry of Fuel and Power (Mr. David Renton): The hon. Member for Anglesey (Mr. C. Hughes) is to be congratulated on making a great many points and asking a number of questions in a short time. It is not possible for me to answer them
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  all without notice, but I can assure him that the electricity boards concerned will no doubt take note of these matters, some of which are matters of detailed administration and, as such, the responsibility of the boards rather than of the Minister.
  I am glad that the hon. Member has raised this matter for three reasons: first, it enables me to give some up-to-date facts about the good recent progress in rural electrification in Wales; secondly, to remove certain wrong impressions which, as is clear from the hon. Member's speech, have arisen as a result of the need to limit capital expenditure; and thirdly, to give a reasonably hopeful and, I hope, not over-optimistic view about the future of electrification in Wales generally.
  As a rural Member myself, I fully endorse the hon. Member's sentiments about the need for electrification on the farms and in the cottages for the efficiency and well-being of those who work in agriculture. The facts about rural development so far are these: as the hon. Member stated, before vesting day, which was 1st April, 1948, Wales lagged behind England in rural electrification. In fact, the percentage of farms connected at that date in Wales was 14 per cent. and in England 36 per cent. I should perhaps add that it is not necessary to assume that there would have been no progress without nationalisation. It is fair to say that some of the companies had very good post-war plans which were well under way at the time of vesting.
  Since nationalisation, considerable progress has been made in both countries, and by 1st April, 1956—just a month ago—the position was that in Wales 40 per cent. and in England 70 per cent. of the farms had been connected.
  It is interesting to compare the position in North and South Wales. In North Wales, there are 23,000 farms, of which 8,900 have been connected, and in South Wales there are 21,000 farms, of which 8,429 have been connected—about 40 per cent. in both North and South Wales. They are running neck and neck. I am not prepared to bet which of them will win this race, nor when the race will finish.
  Mr. Roderic Bowen: In 20 years' time.
  Mr. Renton: That is rather unnecessarily pessimistic.
  As the hon. Member for Anglesey mentioned, this House, in 1953, passed a Motion urging an increase in rural electrification; and a five-year programme of 57,000 farms by 1st April, 1958, was adopted by the electricity boards for England and Wales. The Welsh share of that figure of 57,000 was 12,070 farms, or just over 20 per cent. I say that was reasonably generous to Wales because only 16·7 per cent. of the farms in the two countries together are in Wales; but it was purposely and rightly made generous because the Welsh started a 'good way behind the English in this race.
  In the first three years of the five-year programme, 32,369 farms were connected in England and 7,811 in Wales. Therefore, the satisfactory position was reached that in both countries more than the annual average necessary for completion of the programme in five years was achieved. In other words, in three-fifths of the five years approximately two-thirds of the farms had been connected. The boards, therefore, were ahead of schedule when this year the Government had to 'consider the capital expenditure of the nationalised industries to make sure that they were not spending more than the country could economically afford.
  The capital cuts had to be carefully considered by the Government in consultation with the industry and during part of the winter there was, I agree, a period of understandable uncertainty on the part of the boards, which led to the expression by some officers of some area 'boards of fears about the future of particular schemes.
  An unjustifiable impression still remains in the minds of some of those officers, but I hope that what I am saying will help to clear it up. I hope that the fears of most people, such as they were, will have mainly disappeared since the Government announced what the cuts would be.
  On 20th February, my right hon. Friend said that, broadly, they would fall equally upon distribution and generation. He announced that in this financial year farm connections in England and Wales as a whole should be not far short of 12,000, which is, incidentally, the annual
  560
  average necessary to complete the five-year programme. That figure of 12,000, not far short of which it is hoped to reach, compares with 12,500 originally planned. It was for the Central Electricity Authority, in consultation with its area boards, to decide how the available money was to be allocated among the boards and, as a result of their deliberations, the Welsh share arrived at is such that 2,500 farms will be connected compared with an original estimate, hopeful or otherwise of 2,700. So Wales, again this year, will have its 20 per cent. of the total of the two countries. I hope it is clear from the figures I have given that Wales is getting its fair share.
  There are one or two specific points which the hon. Gentleman mentioned with which I can deal to some extent. He made the suggestion that special assistance should be given to those parts which are underdeveloped, but I feel that it is difficult to answer that point without elaboration on his part. Does he, for instance, mean a Government subsidy, or a subsidy by some consumers to other consumers in the same area; and has he borne in mind the fact that there are various subsidies under the Hill Farming Act? But perhaps he and I could have a word about this and explore the matter further.
  There is then this question of the various letters which have been written and, in particular, those in relation to his own constituency. I cannot possibly answer in detail for those, but I can say that I do not consider that there is any general justification for anyone saying that schemes which were definitely planned by the board for this year will, on any large scale, have to be postponed for a very long time. I cannot see how that can arise on the figures which I have given.
  So far as I have been able to give him the general picture, in the time available, I hope that his fears, and those of his constituents are set at rest; but, if there is a particular scheme in his own constituency—as he mentions there is—then his remedy is to pursue the matter with the board. It is not for the Minister to dictate to the board which scheme should be completed next.
  Mr. C. Hughes: There might be a general delay, I am assured, of 12 months

  561
  in these schemes. Is there likely to be that delay or an even longer one?
  Mr. Renton: It all depends on what is meant by the word "delay". If a scheme was, in any event, not even planned for this financial year, then it is hardly surprising if there is a delay before starting on it. But it would surprise me very much to learn that a scheme, actually started in this financial year, was to be delayed for a whole year. On the figures which I have given I should have
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  thought that there could hardly be any such scheme in the country, but it is a question of precisely how far the thing had got and when it was intended to start it. Without that knowledge it is impossible to comment effectively upon what the hon. Gentleman has said, but perhaps he will write to me about it.
  Adjourned accordingly at one minute to Twelve o'clock.

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  Savings Certificates (Interest Rates)
  Savings Certificates (Interest Rates)
  Income Tax Assessment (Personal Case)
  Income Tax Assessment (Personal Case)
  Nationalised Industries (Parliamentary Questions)
  Nationalised Industries (Parliamentary Questions)
BRITISH ARMY
  Government Surplus Stocks (Disposal)
  Government Surplus Stocks (Disposal)
HOUSING
  Subsidies
  Subsidies
Preamble
The House met at half past two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers
  GRAYSON, ROLLO AND CLOVER DOCKS BILL [H.L.]
  Read 2a.
  MERSEY DOCKS AND HARBOUR BOARD BILL [H.L.]
  Read 2a.

  THE BAKING INDUSTRY
  2.35 p.m.
  LORD TEVIOT: My Lords, I beg to ask the Question which stands in my name on the Order Paper.
  [The Question was as follows:
  To ask Her Majesty's Government what is their policy in regard to the buying up of bakeries by big firms with a view to controlling the sale of bread and in regard to the establishment of plant bakeries and groupings of bakers; and whether these practices have the effect of restricting the sale and content of the wholemeal loaf.]
  LORD CHESHAM: My Lords, it is the Government's policy not to interfere with the normal economic development of the baking industry. The types of bread produced are determined by the economic demand. No doubt, this also applies to the wholemeal loaf.
  LORD TEVIOT: My Lords, while thanking the noble Lord for his reply, I should like to ask him whether it is not a fact that certain large baking undertakings are getting a subsidy. I am told they are. I should be glad if the noble Lord could give me some information on that point. But the small bakers, I understand, are not getting any subsidy. If the noble Lord could not answer that question straight away, perhaps he could on another occasion.
  LORD CHESHAM: I cannot see how the noble Lord's supplementary question
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  has any thing to do with his original Question, but, with your Lordships' leave, I should like to say to him that that is, of course, so. There is a bread subsidy and it is paid, where necessary, to large bakers and small bakers.
  VISCOUNT ALEXANDER OF HILLSBOROUGH: I take it that the bakers will cease to receive their subsidies with the coming into operation of the decisions now being recorded in the Finance Bill.
  LORD CHESHAM: I think the noble Viscount may take that as correct.
  LORD HANKEY: My Lords, are Her Majesty's Government aware that this question has very important effects from the point of view of defence and economic troubles? Are they aware that in the past the existence of small bakers all over the country has proved extremely valuable, both in war and in economic difficulties in time of peace? Could the noble Lord assure the House that that aspect will be looked into?
  LORD CHESHAM: My Lords, as a supplementary question, that raises really a vast field of debate—questions of defence and so on—and I do not think that it would be proper for me to answer the noble Lord now. There will probably be quite suitable occasions in the future for the whole matter to be discussed.
  LORD HANKEY: Could I feel assured that this aspect, which is serious—my own experience of it is very full—will be carefully examined? It was admitted in another place that restrictive practices were being indulged in and that the small firms and small concerns have been bought up. If that is so, it means the disappearance of the small baker who used to bake the bread and have a stock. I must not make a speech, but perhaps the noble Lord can assure me that that aspect will be looked into.
  LORD CHESHAM: What I will assure the noble Lord is that all questions which may affect the economic state of the country and the public interest, including questions of defence, are constantly in the minds of Her Majesty's Government.
  VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, is it not better for us to understand straight away what the real position is behind the original

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  Question on the Paper? There are those who support the production of wholemeal bread, and there are also the economic circumstances of the industry. Are not the small bakers being squeezed out everywhere because they can no longer afford to pay for delivery? At the same time women are going into industry; they are not at home when the baker calls, and they go to the corner shop which is supplied by these enormous combines. We may as well have the whole truth while we are talking about this matter, and we can look into it afterwards.
  THE LORD PRESIDENT OF THE COUNCIL (THE MARQUESS OF SALISBURY): My Lords, as the noble Viscount has risen, I think this is getting into the nature of a debate, and I suggest that the proper course would be for the noble Lord, Lord Hankey, or somebody else to put down a Motion on the subject, if they wish to have it discussed. I do not think it arises as a supplementary to the original Question.

  THE ECONOMIC SITUATION
  2.43 p.m.
  LORD PETHICK-LAWRENCE LORD PETHICK-LAWRENCE rose to call attention to the economic situation; and to move for Papers. The noble Lord said: My Lords, a friend of mine recently asked her ten-year old grandson if he knew what was the meaning of a Budget. "Yes, certainly," he replied; "it is a law that they make in Parliament that makes the cost of everything go up." Sometimes these things are hidden from the wise and prudent and revealed unto babes. Only a day passed after the Chancellor of the Exchequer made his Budget Statement in another place and described it to the public in the evening before we found that the price of bread and tobacco had gone up and that the price of equities and gilt-edged on the Stock Exchange had increased. I never rate very highly the immediate reactions in the stock market, because so often they are reversed a little later on; but on this occasion this reaction certainly suggested to me that the City thought it saw the red light of disinflation turning to amber, and they expected that the green light would soon take its place.
  Is this exactly the effect that the Chancellor of the Exchequer intended to produce? I should have thought not. It would seem to make nonsense of much of what he said in his speeches and of the atmosphere of crisis that prevailed when the Economic Survey was written. Has there been any real change since then, or since we had our last debate in this House on this subject? I personally see no signs of such a change, unless one is to count the small increase in the gold and dollar reserve, which is no doubt occasioned by seasonal causes, or the slight improvement in the sterling exchange which is probably the result of "hot" money. But the matter is so important that I think we are entitled to a direct answer from the Government with regard to it, for they alone are in a position to make a forecast of the financial weather ahead.
  I will put my question as fairly as I can to the noble Earl who is to reply. What I am asking him is this: is there any evidence that inflation is being brought under control to such an extent as would justify any letting up of the most strenuous efforts to combat it? If, as I expect, the answer is an emphatic negative, then I contend that the Budget falls a long way short of being the powerful engine that it ought to have been for restoring our financial stability. That is not to say that it has no good features, which I shall not fail to mention in due course; but, taken as a whole, it is a thing of bits and pieces. It makes me think of the wares of Autolycus—no one article on the whole tray has any great intrinsic value, and none is sturdy enough to make much dint on our economy. The relief given to the self-employed in the matter of savings in pensions will be popular; the increased taxes on companies and on smokers will be unpopular. But in so far as they promote disinflation, which I cannot imagine will be very much, they deserve to be supported, especially if they are "trimmed up" a bit in the passage of the Bill through another place.
  My Lords, when I opened the economic debate here in March last I urged the Chancellor of the Exchequer to take steps to promote individual saving and to supplement that by budgeting for a larger surplus above the line. I therefore welcome the fact that he has come to the same conclusion and has himself

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  taken some steps to put both those suggestions into practice. Of course, the important thing is to attract new money. The mere transfer from existing Government securities into the newly created issues will be of no value, and I gladly repeat the assurances that were given by the leaders of my Party in another place, that any campaign which encourages our people to save money and to invest it, instead of expending it on consumer goods, will have our support. This, however, does not commit us to taking sides in the controversial question of the "Macmillan flutter". On that matter, all I will say now is that it seems to me a rather undignified expedient for a British Chancellor of the Exchequer to adopt.
  I turn to the question of the below-the-line items in the Budget. By successive stages the late Chancellor pushed the local authorities into the market for their borrowings. The effect of this step on the finances of the country as a whole is to substitute a number of individual municipal stocks for the nationally sponsored issues of local loans. It makes the Budget look better on paper; it makes local authorities worse off in practice. But otherwise it makes precious little difference to the facts of the financial situation.
  The Present Chancellor of the Exchequer now brings the nationalised industries into the budgetary picture. This means that, whereas they initially borrowed from the banks, and subsequently floated loans on the market with a Treasury guarantee, they will now be supported throughout by the Treasury, who will have to increase the volume of Treasury Bills to find the money. If the procedure came to a stop there, it would have an inflationary result, as I shall show later; but I imagine that it will not stop there. The Treasury will float new loans on the market from time to time to reduce the amount of the Bills. There will then be no great difference between the previous position and that of to-day; but so far as it is a little nearer to the facts on paper, I welcome the change. We never get the whole picture, of course, until we bring in all the other borrowings which are not done through the Treasury or the special Government institutions—borrowings on be-
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  half of industries, of whatever kind. We cannot expect to get that information in the Budget and shall have always to wait for the Economic Survey.
  I turn now to the announcement by the Chancellor of the Exchequer that he is aiming at a retrenchment of Government expenditure in the current year of about £100 million. I confess that I find this somewhat confusing. It is a commonplace with those who know anything of our financial arrangements in this country that whereas the Prime Minister and the Chancellor of the Exchequer of the day ought to be constantly struggling to do away with departmental waste, sums such as £100 million cannot possibly be saved without alterations in policy. I am satisfied that that view is entirely correct, in spite of the fact that there is a section of the Conservative Party which holds it to be entirely wrong. What then is Mr. Macmillan really proposing? Of course it is easy to call every shortfall in expenditure a saving, and to take a Supplementary Estimate for every addition—but I will not impute such an intention to the Chancellor of the Exchequer. I presume that he is really going to make policy changes which will be revealed, one by one, as they are decided upon. If that is what he means to do, then we cannot possibly form a judgment on whether his cuts are wise and good, or the reverse, until we know precisely what they are in each individual case.
  So far, I have been dealing with things that are strictly within the four corners of the Budget itself. I have yet to deal with the other matters, most of them of paramount importance, which lie outside the Budget proper; before I do so I would say this to the present Chancellor of the Exchequer: whilst I do not believe his budgetary programme adds up to very much, he does seem to me to have profited from the mistakes of his predecessor. By this I mean that he realises that dear money cannot be the sole, perhaps not even the main, disinflationary weapon to be employed in the present situation. I know that I have often addressed your Lordships on this question of dear money, and I have no intention whatever of wearying your Lordships with a repetition of what I have said before. I will therefore content myself with the remark that from recent articles

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  in the Press and in the bank magazines it would appear that the climate of banking opinion is changing. The view is emerging that neither the bank rate nor open market transactions by the Bank of England have the same potency to-day as they had in the nineteenth century. This is attributable to the huge volume of the floating debt, mainly in the form of Treasury Bills, which act as a cushion, preventing the contraction of credit which it was the object of old-fashioned monetary weapons to bring about. I commend this view to your Lordships.
  I come now to the main question of the cause and cure of the present inflation. Thinking the matter over, I have come to the conclusion that there is something of the old Adam in most of us, so that we are all fond of putting the blame upon someone else. In particular, there is a widespread view held by the upper and middle classes to-day that it is the fault of the working man, and that if only he would not make such exorbitant claims for higher wages, and enforce them by threats of paralysing strikes, all would be well. The worker may or may not be wrong to do this—it all depends upon our philosophy of life. If we accept the view that everyone is entitled to make as much money as he can, and is entitled to use his economic power to the full for his own personal advantage, then I believe that the worker has a very strong case. In the first place, he can point out with proof that in the nineteenth century, when the balance of economic power rested with the employing classes, the manual worker was treated with savage inhumanity. In the second place, in the 'twenties and thirties of the present century he was allowed to be crushed by the deflation. To-day, when the balance of economic power has shifted in his favour, he asks why should he not take full advantage of it.
  What is the answer? If we are to persuade him to abate his claims we shall have to do a great deal more than tell him that to do so is in the national interest. He will have to be convinced, as he is not at present, that we are at least restraining equally wasteful extravagance in other sections of the community. The working man is much better informed to-day than he was in days gone by, and he knows a great deal more about what is happening in circles of society other than his own. I have always been a great
  50
  admirer of the British people for the honest way they paid their taxes. I sat for ten years in the House of Commons, covering the period of the last world war, and never remember a single instance when a Member of Parliament tried, at the instigation of his constituents, to reduce the burden which the Chancellor of the Exchequer sought to impose on the people. Many noble Lords were with me there in those days, and they will bear me out when I say that. In this we were a shining example to other nations where a different spirit prevailed.
  But I regret to say that there has been a falling off in rectitude in recent years. I realise, of course, that the impositions on large incomes and on large estates are very heavy. I am willing to believe that the actual infringements of the letter of the law are comparatively few. Nevertheless, I am satisfied that there are substantial leakages through what is euphemistically described as "tax avoidance" and that these leakages are on the increase. The tax which it is principally sought to a void is surtax, arid it is becoming a commonplace among accountants that when the income concerned is derived from investment it is generally possible to reduce the payment considerably by manipulation of securities. I read in an economic journal a few days ago a statement to the effect that a lawyer had definitely stated that in such cases payment of surtax is becoming voluntary. That may be an exaggeration, but there is a certain element of truth, at any rate, in it. Of course, earned income cannot obtain a similar relief. But in that case the improper enlargement of the item known as "expenses" may be used to cover extravagant entertainment charges, and so escape both income tax and surtax. Finally, there is much abuse of the right to treat unlimited advertisement costs as a trade expense.
  There is no need for me to elaborate these things. To a large extent they must be matters of common knowledge to most of your Lordships. I should, however, like to emphasise this fact; that if a given amount of revenue has to be raised, every pound that is improperly withheld in one of the ways that I have described is a pound which some other taxpayer will have to put his hand in his pocket and find, if he is paying honourably his full taxation. What I ask the

  51
  Government and the Chancellor of the Exchequer to do is to face up to the full significance of these facts of which the Financial Secretary in another place has admitted that they have some tangible evidence.
  I know that in the Finance Bill that will come before us in due course—it has not really been discussed so far in another place—there are one or two clauses that touch on some aspects of this question. But they go only a very little way. I am asking for something much more than that. I should be glad if the noble Earl, Lord Selkirk, who is to reply to the debate to-day, or perhaps the noble Earl, Lord Munster, who is going to reply after the continuation of the debate on Tuesday (I think he will be winding up for the Government) could assure us that a careful study of these facts is being made in the Treasury, and that if they prove to be what I have described, some really substantial and drastic action will be taken at an early date. Personally, I have always thought that if heavy taxation has to be imposed on the owners of great wealth, surtax was the most efficient way of doing it. But if it is now found that surtax has holes in it which are incapable of repair, other means of effecting the same end will have to be found. I see that suggestions are being made of various other means of taxation—such as a capital gains tax, or expenditure tax. Frankly, I have not studied these proposals, and I do not know in the least whether they would be practicable or, if practicable, whether they would be satisfactory. But I do know that the community will not suffer itself to be thwarted in giving effect to the measures which are the law of the land.
  For my part, my Lords, I do not believe that we shall find any one simple and palatable remedy which will stave off the malady of inflation. I do not believe that it can be cured by dear money alone, by taxation alone, by personal appeal alone, and certainly not by the false doctrine that everyone should pursue his own personal advantage at whatever cost to others or to the community at large. Resolute action applied impartially by the Government is an essential prerequisite. Inspiration must be given by men and women of good will in all Parties and in all ranks of life. But only the people as
  52
  a whole can make the sustained response which will win through to victory. My Lords, I beg to move for Papers.
  3.8 p.m.
  LORD REA: My Lords, the wording of this Motion calling attention to the present economic situation, while conventional in form, rather postulates an impossible task which, however, never daunts the lion-hearted noble Lord, Lord Pethick-Lawrence. I think we shall all join with him in his opening remarks and in praying that the red light of inflation will progress to the green light of deflation and will not remain for ever amber. It is right that we should have a debate like this and we are once more indebted to the noble Lord for seeking again this afternoon to focus 100 per cent. of your Lordships' concentration—if indeed such a percentage exists—upon a problem which it is, admittedly, beyond the human mind to grasp.
  At the same time, we are all agreed that the economic situation demands the constant and meticulous attention of both Houses of Parliament; for it is still regrettably far removed from the happy circumstances when, if I may say so, notably under a Liberal Government, it could virtually be left to take care of itself; and the more it was unhampered by restrictive guidances, the more it seemed to prosper and flourish. It is, of course, the transition from the ancient mediæval political principle of national self-sufficiency to the later necessity of inter-State co-existence and interdependence that has brought about the need for regulating, in such unwelcome detail, the natural laws of supply and demand. Indeed, the complexities of international competition are being matched to-day more and more by the parallel complexities involved in international co-operation. We are, I submit, and hope, approaching a state where competition, in the sense of antagonism and rivalry between nations, will become a hindrance to national as well as to international progress and where prosperity will depend not merely on current peace but also on real and lasting good will.
  With this prospect in view, it is plain that in the economic field we must lay our plans with completely new and increasing anticipation of future trends; with much less emphasis on extemporising for the present, and with the relegation of the old economic machinery and

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  conventional prototypes to history and to the museums. I put the importance of these three principles in that order—future, present and past. But because of the overwhelming amount of detail which Government Departments have to deal with, and deal with quickly, and because they have to assess and co-ordinate all their work with the minimum delay, it is not surprising, though it is regrettable, that Ministers are guided and advised, it seems, on the basis, first, of immediacy and expediency, or, when that fails, of precedent and custom, and only too seldom with a convincingly broad anticipation of what the future may bring. Of course I am not criticising our excellent Civil Service, which has IRA the function of creation—that function belongs to the Ministers, under the pressure of Parliament and of the electorate; and it is therefore disappointing and frustrating When an able Ministry produces, as it has just done, a rather pedestrian and uninspiring Budget whose only highlight is received by the public, on the one hand, with some little amusement and, on the other, with indignation.
  After all the warnings and exhortations which we have received, and which have successfully induced in us all a willingness to face some unusually stringent form of self-sacrifice until the dangers of to-day's inflation are brought under control, it is a stinging anti-climax to be presented with such an anæmic syllabus. We see parsimonious neglect of such really deserving causes as the increasing difficulty facing old people, particularly old age pensioners; of the cultural field, with its moral and international values, especially as disseminated by the theatre; and particularly of that tragic and unvocal class of people with small fixed incomes, grimly facing, at the present rate of decline of purchasing power, either starvation or very cold charity. We see also a reprehensible and shortsighted policy of throwing away the established source of our best university material through an ill-thought-out scholarship means test. And we see the middle classes, abandoned by both of the big political Parties, bearing more and more of the burden shared by others who are more capable of bearing it than they are.
  On the other hand, the Government fail to follow up some quite simple and easily followed leads given to us in
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  other countries—on the Continent, in particular!where, for instance, a bicycle tax is found to be both reasonable arid profitable without injury to the manufacturer or harm to the owner. Nor should it be difficult to collect a 10 per cent. tax on hotel and restaurant meals costing more than £I a head and on every bottle of wine going with these meals costing over 30s. a bottle. These figures may sound comparatively high, but I think noble Lords will agree that nowadays they are not unusual. The payer of that tax would hardly notice he was paying it, and because he would hardly notice it, it would be a good tax. But instead of giving us a row to hoe, we are given warnings and sermons and exhortations, and we have the uninspiring spectacle of the Government, neglecting the country's readiness to accept some constructive hardship, going through all the motions of Olympian labour merely to produce a mixed family of mice and red herrings, with an occasional hare thrown in. Successive Chancellors of the Exchequer make no noticeable splash, except the over-familiar splash caused by drearily and repeatedly piling Pelion slap into Charybdis.
  A Budget, however, is no more than a symptom of how a current Government view the current economic situation both at home and abroad. We in this quarter of your Lordships' House feel that the Government have lost sight of, or failed fully to recognise, the two outstanding and basic hindrances to economic progress in both these fields. In both cases there are, as I have said, first the fearful preoccupation with the present, handled in terms of the past or of extemporisation, and secondly, the failure to take a risk for the future: failure to cast one's bread upon the waters in confidence that in this modern world success will follow only the type of broad boldness which characterised the adventurers of a previous Elizabethan Age. At home, the one thing we obviously need is more productivity, and the one thing which is retarding that more than anything else is the still unsatisfactory state of industrial relationships, not only between employers and the employed but often between one employer and another and between various categories of workers.
  In regard to employers, the Government are taking very welcome steps in

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  a new Bill—the Monopolies Bill—to get over the difficulties which have reacted seriously and very wrongly on the nation's trade, but in regard to the workers, no parallel measure seems to be in view. The structure of the labour market is protected and guided by an organisation—the trade union movement—which we on this side of the House look upon as a very fine and admirable development in the modern political world. It has brought the workers into a position of power which they ought to have. It is led by men more often than not of high intelligence and calibre, and it is an excellent example to all other countries of a constructive and protective democratic institution. We on these Liberal Benches have taken pride in helping to foster its beginnings and we continue to support and defend its continuance and its aim. Indeed, we value within our own Party the contribution of the Association of Liberal Trade Unionists, who, unfortunately, like millions of other Liberals, are sadly underrepresented in Parliament.
  But this trade union structure, which is now an immensely important part of the nation's life, and which can make or mar our national economic prosperity, has not been reviewed or examined, except from within, for far too long. The Conservative Party and the Labour Party seem to be completely silent on this matter. I suggest that it is the Liberal Party alone which presses for an immediate inquiry into the workings of trade unions and trade unionists. We are fully aware, of course, that this demand will be unpopular with the political and Parliamentary leaders of both the other big Parties, but we are equally aware that our demand is welcomed by masses of people in this country who are convinced that the present working of trade unionism can, and in some instances—often very important instances—does, impinge with injustice or hardship on all three of the elements concerned: the employers, whose efficiency can improperly be restricted; the worker himself, who we all know can be, and has been, victimised by harsh rulings from his own union; and last, but not least, the vast mass of the public, the consumers—the middle classes, in particular—who, whether they be employers or workers, or neither, are
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  continually held to ransom by the dictates of this great organisation which exists for the public good but which occasionally works for a minority at the expense of the majority.
  I repeat that we wholeheartedly support this great machine; but if only for the sake of the occasional trade unionist, not greatly interested in politics perhaps, who does from time to time get a raw deal, we ask that an inquiry be set up to bring this historic movement up to date: not to damage it; not to weaken it or to clip its wings; but to ensure that it shall achieve its true function in the world of to-day; the safeguarding of the worker and his position throughout the nation and in the interests of the nation. The only valid objection that I can see to this inquiry is that the trade union movement is so perfect, or so nearly perfect, that it is incapable of improvement. But do the Labour Party really think that this is so? Or are they perhaps afraid of losing votes if they tamper with an institution which sometimes affords an unfair political advantage? The right to strike is not an unfair political advantage; that is a perfectly legitimate political weapon. But the power to render a man workless and homeless because he cannot conscientiously conform to the political ideas of a small handful of his colleagues—the policy-making handful—is that a fair political advantage?
  THE MARQUESS OF SALISBURY: I should like to ask the noble Lord one question. He said that the right to strike was a quite legitimate political weapon. I think he meant to say an industrial weapon.
  LORD REA: I beg your Lordships' pardon; I should have said industrial weapon. Do the Conservative Party think that the trade union system is perfect? Or do they, also, rather fear losing some votes from the working class if, in the interests of pure justice, they seek to improve some of the anomalies which surely must have arisen in a movement founded ninety years ago and which, despite its unlimited influence on the nation, is still autonomous? If my remarks are interpreted as an attack on the trade union movement, then that criticism will be unfounded, because we support that movement with sincerity and good will. But, like many others, we are not convinced that by its present operation in all its present conventions the

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  worker or the consumer is getting quite as good a deal as he might, either in short-term detail or in the long-term economic view. For that reason, I urge a review and an immediate inquiry, for the good of the whole nation, into the workings of the trade union movement.
  In the light of the circumstances of to-day, the economic picture overseas is such a big one that I shall touch upon it in only two respects: one of broad principle and one of comparatively small detail. The broad principle is one which your Lordships will not be surprised to hear from these Benches: the principle once more of casting one's bread upon the waters; of making it easier for foreign nations to trade with us, in order that we may in consequence find it easier to increase our export trade to them. It is significant, I think, that since the war we have heard increasingly and all over the world a call for a reduction in trade barriers; that there must be bilateral and multilateral agreements not to raise further the economic obstacles to the free movement of goods. There seems to be arising a sort of universal acknowledgement that a world of watertight compartments is now an unworkable anachronism. In the changing values of English words and the English language I do not think that that particular theory has a name, unless it is perhaps in reverse what used to be called "Tariff Reform"!because these tariffs do need reform, if not abolition. In my younger clays I think that economic theory used to be called "Free Trade," but I would not seek to embarrass any Government with old Party labels; I would only urge them to go right ahead in loosening up all the archaic drags upon international interchange of goods, people, culture and good will.
  This brings me to my final point, which is in the nature of a suggestion on one specific aspect of international reciprocity. I refer to the great need for the easier movement of men and women, and children, too, between this country arid other countries. It is recognised in the business world and in the academic world, and now more than ever before in the political world, that human contact with other nationals is most valuable and probably pays a very good dividend. Foreign travel is no longer the monopoly of the privileged few. The tourist trade, as your Lordships know, is now a vast industry,
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  and it has conic most acceptably and admirably within the orbit of the "little man" and within his financial capacity. Even since 1950 the number of British people going to the Continent has risen from approximately 900,000 to what I am informed may this year be about 2 million and the amount per head spent on those ha days averages something between £40 and £45. I am convinced that this flow of British people to other countries, and, presumably, the resultant stimulus it gives to traffic in the reverse direction, is a most excellent and desirable thing to be encouraged in every way. But, my Lords. there is a sort of shadow hanging over the development of this business, in the form of the limitation of travel allowance money and all the complications and apprehensions which that brings with it. So I am going to ask Her Majesty's Government now to abolish forthwith this restrictive and, I think now, unrealistic form of control over the free movement of British citizens in their legitimate desire to travel.
  It may be argued that since the annual allowance is £100 per head there is not really much hardship to the average traveller who, as I have said, spends £45 on average in each year. But there is something incongruous and irritating, and I think unpleasant, for a man of modest means, who has perhaps saved up £40 or £50 to take his small family for a cheap holiday, perhaps in the North of France, to be told that he must beware of spending more than £300 or £400 (which he has no intention of spending) and that he must fill up numerous forms, have his passport endorsed and go through a variety of irritations both before and during his journey out and on the way home again. The prospect of such difficulties is bound to discourage the uninitiated and is bound to be a brake upon any small potential ambassadors of good will.
  At the other end of the scale there are those who wish, for reasons which may be neither extravagant nor self-indulgent, to exceed the limit of £100; and amongst the hardest hit in this respect are those who go to the dollar area, where expenses are particularly high, and those who, for some perfectly good reason, may have to go abroad from this country more than once during the year. The fact that the average expenditure is only £45 per head is, I suggest, adequate proof that this "£100-plus" category, if I may so call

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  them, are few in number; and, therefore, it can hardly be argued that the total expenditure would be likely to show a large increase over the present figure if the travel allowance were removed. But though these "£100-plus" people are few in number, they contain a very valuable element of ambassadorship. They are the people—many of them—who mix with and talk to and are entertained by their foreign counterparts; and the humiliation of being unable to return casual hospitality, or of continually being seen to choose the cheapest dishes, the cheapest excursions, and forgoing a cup of coffee from cheeseparing necessity, seems to me to be definitely damaging to our national prestige and to the self-confidence and dignity of our fellow citizens. Of course, this is particularly galling when other nationals, including notably those who are commonly thought to have lost the war, are either in possession of a far larger allowance, or even have no restrictions at all.
  Even the extra allowance for business travel is utterly and embarrassingly inadequate, and industrialists who go searching for foreign custom must often wonder whether their efforts are as important as the Chancellor of the Exchequer says they are, for they are sadly hampered by the indigent impression which they make. There is, of course, the big financial operator dealing in large sums in the black market, or by some evasion of the existing regulations, and I do not propose that he be freed from Treasury control by the abolition of the travel allowance. It is not beyond the power of our experts to devise some regulation which will keep him in order without penalising the freedom of ordinary people's normal personal expenditure; and, with this small reservation, it would seem that any objection based on the difficulties of the international Balance of Payments Fund would not be a substantial one.
  I submit also that the machinery needed to maintain the restrictive fetters of individual liberty must be not only expensive but typical of the wasteful sort of departmental red tape which this Government have undertaken to eradicate. I do not know the number of people employed in printing, issuing, adjudging, stamping and recording documents in duplicate or triplicate—or
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  worse; but apart from the 2 million unfortunate travellers who are thus imposed upon I imagine there must be thousands of clerical workers engaged on this, as I would think. useless work in the Foreign Office, the Treasury, the Bank of England, the Customs Service, and the Exchange Control, not to mention hundreds, or even thousands, of employees of banks and travel agencies throughout the length and breadth of the Kingdom. I therefore urge that, in the interests of national economy, and particularly of international reciprocity and prosperity, the travel allowance should be abolished at once, so that 1956 can start a period of much freer movement, much greater confidence, and a little more national dignity.
  3.32 p.m.
  VISCOUNT HAILSHAM: My Lords, my contemporaries, of whom I am glad to see quite a number in this House now, have always told me that I ought to leave economics alone because, they allege, I know nothing whatever about them. This harsh judgment I have never been able wholly to accept. On the other hand, on this particular occasion I would not seek to avoid the severity of the sentence. except for my desire to say a word about what was undoubtedly the most widely publicised, if not perhaps the most economically important, of the Chancellor's proposals in the Budget. I doubt whether I should have thought it right to say anything about it were it not for the extent to which I was filled with dismay by the intervention last week of the most reverend Primate on the subject of premium bonds—a dismay which I felt not only for the occasion which he chose, which rendered it virtually impossible for anyone who did not hold in contempt the Rules of Order to give him any kind of adequate answer, but also for the matter which he included in his speech by way of argument.
  I feel that I should be less than courteous to the two eminent speakers who have so far addressed your Lordships if, before I approach that theme. I did not address a word to each of their two interesting speeches. If I may say so, I thought the noble Lord who spoke from the Liberal Benches was unduly contemptuous of the Budget because, to my mind, he confused the importance of the Budget with the number of important changes

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  in taxation which that Budget contained. There are not many important changes in the present Budget, but it does not follow from that that it is nothing but a collection of mice. In some ways I rather wish it were. But a Budget which raises £5,000 million of taxation from a country which has been burdened for years with economic difficulties can never be anything else but a labour of Hercules; not the apocryphal labour!-did I understand the noble Lord aright?—of putting Pelion into Charybdis, but one of the real up-to-date labours of Hercules. When, in addition to the £5,000 million to be raised by taxation, the Chancellor deliberately budgets for a surplus of £445 million !rather more than half the pre-war Budget—by way of sheer extraction from the taxpayers' pockets, in order to achieve disinflation, I can only say that the fact that this can be accepted with some degree of equanimity by both sides of this House is a great tribute to the public spirit of the British people and its political Parties.
  May I say a word by way of respectful admiration to the noble Lord who introduced this debate? I always feel for him peculiar feelings of veneration, because my father always told me that they sat next to each other in Division at Eton. The thought of those spendid Titans in their heroic youth learning side by side has always filled me with great wonder. I have sometimes, in my less respectful moments, wondered who cribbed from whom and who gained. But if the noble Lord will allow me to say so, I never listen without gaining a great deal from the right balance and maturity with which he expresses economic views to your Lordships' House. While it would be too much to expect a Conservative to agree with everything the noble Lord says, I do not think one ever fails to learn and be enriched by it. There was one sentiment which he let fall with which I think every Conservative would agree —namely, that economic integrity can be obtained only by a sense of dedication on the part of all elements in the community, and that the habit into which people are sometimes apt to fall of devising ingenious methods whereby other people shall share a greater part of the burden is lo be deprecated in all quarters of society.
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  Before I turn to what I have promised to be my real theme, I should like to say that I am hoping for the day—with what chance of success I know not—when the Chancellor of the Exchequer will find it possible to distribute a little part of the surplus for which he is budgeting this year. To my mind, the individual allowances of income tax have now ceased to bear much relation to reality in view of the depreciation in the value of money. I hope that, before this Parliament comes to an end, the Chancellor may find it possible to revise his system of taxation by easing the burden on all classes by bringing those allowances back into relation with reality.
  When we see in operation a system of full employment in which the balance of payments cannot be achieved, or achieved with security, to my mind it falls as an inescapable conclusion that we are spending—as I think is often said—too much on our home consumption and too little on our export trade, since the capacity of our factories is at the moment running at its maximum. I was therefore particularly glad to see that the Russian visit had resulted in some prospect of an advance in trade between the two countries. During the Korean war there was every justification for the kind of restriction we had to impose upon trade with the Communist countries; but now that there seems a real prospect of, at any rate, an indefinite period of peace ahead of us, we should, I think, develop that trade to the maximum extent. I believe that the development of that trade will not only assist our economic difficulties, but will also give an additional guarantee of peaceful co-operation between the two sides in which mankind find themselves divided.
  I now propose to say a word—I am glad to see that there are two right reverend Prelates here to hear what I have to say—on the subject of premium bonds. Bishops are always talking to us about politics, and we welcome the freshness and vigour with which they express their opinions. But perhaps they will sometimes forgive the man in the pew!and that I certainly am, because I go to church. Sunday by Sunday, unworthy as I may be—saying a word or two to the Bishops about the leadership which they give the Churches in matters which ought to be within their province. Perhaps they

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  will gain from our freshness and sometimes our brashness of expression. When, in the sixteenth century, we cast off the jurisdiction of the Papal authority we did so on the basis, if they will forgive me for saying so, that Holy Scripture contained all that was generally necessary to salvation. We did not do so in order to sot up a number of Popes all over the country, designing to add to the Holy Scripture new prohibitions and maledictions and greater burdens than even our fathers were able to bear.
  There has always been, my Lords, a lunatic fringe in the religious world which has thought to improve upon the Ten Commandments. I do not know how many they would add. There are some people who would say that there are at least twelve, adding to the original war establishment: "Thou shalt not bet" and "Thou shalt not drink." They are not to be found in the twentieth chapter of Exodus. What is to be found is an express prohibition in the fourth chapter of Deuteronomy against adding to the prohibitions imposed by the authority of the Divine command. Neither betting nor gambling nor drinking can decently be treated in the same way as adultery. To do him justice, the Archbishop was perfectly frank about this. My complaint against him is that he gave aid and comfort to those who would deal with the matter in this way and who are perpetually talking to us as if a glass of beer or a "flutter" in some form of gambling (in which, I may add, I never indulge, because I should always lose if I did), was to be treated as something expressly prohibited by the Divine command. It is not. The violent indignation which was excited in some quarters by the suggestion of premium bonds can be attributed only to this kind of false doctrine, directly contrary to what can be found in the Bible, that drinking and betting should be prohibited and are on the same basis as the major sins.
  Now, my Lords, I was particularly struck with what my noble friend Lord Halifax said the other day: betting is evil from the moral point of view only to the extent that it encourages people to spend more than they can afford and thus deprive their families of the means of support; or, alternatively, only in proportion as it leads some people to attach
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  too great a value to money. The latter ground, too, is a purely moral evil, and, as such, I should have said, with respect, that the Legislature had nothing whatever to do with it. I was reading only the other day the essay of Mill on Liberty in which exactly this kind of point was made. If it is the former evil with which we must deal, we must, I think, bear in mind what kind of evil it is that we are trying to define. I should have said myself, in contradistinction to the unco' guid, that the way in which to discourage gambling or, for that matter, drinking, is to get rid of the social evils which have given rise to them. In the main they become a social evil largely because of poverty, and that is why in this period of the twentieth century, although their incidence may have increased—of that I have no evidence—they are much less of a social evil than they were in the nineteenth century: and social legislation is a much better answer to betting and gambling than this perpetual preaching against them as if they were a major sin.
  I wish to fit this consideration into the effect of the particular proposal which is now under discussion. I am not in the least interested in the jejune, pedantic and legalistic argument as to whether a premium bond is a lottery or not—that seems to be a boring and irrelevant discussion. The question is whether and to what extent it will be productive of social good and discouraging of social evil. To my mind that question, properly posed, can yield only one answer, and that is this: if gambling is a social evil at the present day only (i) because it leads people to spend more than they should upon gambling so as to deprive their families of support, or (ii)—and I should concede this at once—because the encouragement of a big gambling industry diverts economic effort at a time when we can ill afford it from the forces of production and really valuable activity, then the introduction of a premium bond can do nothing but good. It is aimed at syphoning off money which would otherwise go into gambling into a form of saving by the attraction, similar in character to gambling but opposite in effect, of a chance gain in place of a regular rate of interest. If it takes money out of pools and away from racecourses and puts it into savings it will divert the

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  money from an uneconomic activity into an economic activity; and by providing that in no case will a loss be possible it will prevent the gambler from depriving his wife and children of the means of support.
  I do wish our Bishops—I really wish our Bishops—in dealing with the moral evil would allow themselves to face these serious intellectual points about gambling before bursting into print and into song full of admonition of Governments on political issues, and then expecting their laymen to applaud heartily. The truth is that this is not leadership, it is a bad example; and it is a bad example on precisely the kind of thing upon which we look to our Bishops for protection and support. We want to be protected against heretical views of sin; we want to be protected against the constant imposition of false and imaginary burdens upon our consciences, and we want, on the whole, to face the serious economic and political issues without the introduction of false religious and irrelevant doctrinal considerations.
  When I turn to the political critics, who have tried to exploit this religious confusion which I can only attribute to a confusion of mind, I am bound to say that I feel even more strongly about the matter. In another place, a prominent spokesman for the Party opposite described the premium bond as a "squalid raffle". I suppose in the ordinary run of political vituperation that is not unduly excessive language, but I must say that researching into the Manchester Guardian of about a year back I was somewhat surprised to learn that in order to raise additional funds for the Labour Party, the National Union of Labour Organisers in 1954 devised a scheme for operating a Party football pool, to run in competition with the commercial pools. A company was registered in August, 1954, under the title of Clarion Services Limited, and weekly coupons were distributed from September 11 onwards. A deduction is made from the total money staked by competitors as a grant to Party funds. Two hundred constituency Labour parties were reported to be participating, and in January, 1955, it was further reported that the pool earned £1,000 profit for the Party in the first eight weeks, a second £1,000 in the next six weeks, and at that date the rate
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  of earning was increasing rapidly. Moreover, according to the Manchester Guardian, one of the Labour Party newspapers said
  "it could, in the end, reasonably hope to raise £500,000 a year!roughly equivalent to the Party's total revenue in 1953."
  If premium bonds are a "squalid raffle", the attempt by a political Party to arouse false bigotry in order to achieve political advantage is nothing but squalid hypocrisy.
  3.50 p.m.
  LORD LUCAS OF CHILWORTH: My Lords, I hope the noble Viscount who has just sat down, having delivered himself of a typical Lord Hailsham speech, which we have all enjoyed immensely, will forgive me if I address myself on this occasion to something which I consider, and I hope your Lordships will consider, is of slightly more moment and comes within the ambit of the Motion moved by my noble friend: how we in this Country in the future are going to earn our daily bread. I take that to be the main and focal point of Her Majesty's Government's fiscal policy since they have been in power. I have understood that the main object which confronts us is to increase our export trade, and so bring into balance the exports which we send from this country and the imports which we have, perforce, to import. In addressing myself to this problem, I intend to ask some stern questions and, for my part, I hope to give what I consider to be at least some honest answers. Therefore, at the very outset I wish to take sole responsibility for the opinions I express: they may commend themselves to some of your Lordships on both sides of the House, but I dare not hope that they will be received with commendation from everybody.
  The first question that I should like to ask Her Majesty's Government is by what process of reasoning or deduction they think that in 1956 we can export from this country sufficient goods to match the imports that we seem to import from the rest of the world. In my living memory we have never achieved that before. Never in the history of this country have we achieved a balance between physical imports and exports. Why do we expect to do it now, when conditions are entirely different from what they were before the war, when we have rampant throughout this world a spirit of

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  nationalism, when every country is striving to be self-sufficient, when we see countries like Japan, Western Germany and others, with their technology so increased that they are far greater competitors in this export world than they were before the war?
  I have in my pocket a small straw which shows the way the wind is blowing. I have here a lighter, a perfectly good one; it never fails to work. It is sold in the United States of America and Canada for 20 cents—I s. 8d. It is "made in Japan". This one, which was given me, bears the hallmark of a well-known beer that is sold in Canada. Similar lighters are given away by the thousand. It is a perfectly good lighter, a copy of a well-known British lighter, the Ronson; it cost 1s. 8d. and it never fails to work. That is a slight straw showing the competition that we have to face.
  I spent the winter in California, a country that God Almighty has blessed with the most perfect climate and with a people who are the kindest and most hospitable I have ever met. I was afforded the opportunity of studying at first hand the dollar market qua exports. I had the opportunity of discussing this matter with bankers and industrialists in California, and I came to the conclusion that to make any worthwhile impact on the dollar export market is an impossibility. That is a serious thing to say. May I make one thing perfectly clear to your Lordships? I was on the West coast of America, not on the East coast, but there is one thing that I would warn your Lordships about, for it is going to become one of the greatest social problems that America will have to face—that is, the gigantic drift from the East to the West. Already, when I was in Los Angeles, a colony of 4 million people, the population of Los Angeles county was growing at the rate of 40,000 a month. The prosperity in California needs to be experienced to be believed.
  Discussing this matter with some of the biggest industrialists there, listening to what they had to say publicly, and even taking into consideration, as one always has to do, the fact that 1956 is a Presidential year in America, I came to the conclusion that there are all too many industrialists of high rank in America
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  who had quite persuaded themselves— and, unfortunately, had succeeded in persuading many other people—that the American prosperity and standard of life could go up and up and know no bounds, even in the middle of a world of economic disequilibrium; and even, in some cases, of starvation. That is not to say that I do not think our dollar exports could be better—I think they could. As your Lordships know, I have a particular affinity with the motor car industry. I studied the position out there. I am going to say quite frankly that if we judge our middle-class motor exports to America and compare them with the middle-class American automobiles, we are five years behind. There are exceptions.
  The Rolls-Royce motor car in America is experiencing a boom because at long last it fulfils the American requirement as regards styling and automatic gear boxes. The Jaguar is another one that will find a ready sale in America. That small sports model, the M.G., is also selling remarkably well, because it is a gadget—I say that with no disrespect. But if you take what I would call the middle range of our exports, the American will not look at them. The American motorist has decided that he is finished with moving a gear lever—he wants automatic gear change; he wants power steering and power brakes, and he wants a lot of power under the bonnet. May I again refer to Los Angeles, a county of four million inhabitants and just over two million motor cars—one motor car to every 1·8 of the population. The American wants a new motor car every year and he wants something different from the model he had the year before. California is the most gigantic motor car market in the world, and it is the most competitive.
  Why do we expect to sell these motor cars? When your Lordships listen to stories about record sales, I would beg you to bear in mind the simple fact that a 100 per cent. increase on one is only two. Within the limits of the special models I have mentioned we have a margin; but if we think we are going to make a dent in any market in America we have made a great mistake. In California I collected plenty of evidence of the apathy of the British exporter. Sitting opposite I see the noble

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  Lord, Lord Rochdale, who is President of the Manufacturers' Association. He knows about that apathy; it has been conveyed to him. In California we have operating an excellent British-American trade agency. What is their heartbreaking task'? It is to hear from British manufacturers, after contact has been made!in some cases six months afterwards—that they are not interested. Why should they be? What is the incentive given to the British exporter to take the risks, especially in the dollar market? I can assure your Lordships, whether or not it is nice hearing, that nobody is going to make any worthwhile dent in an American market before the gates are shut and barred. That is not very nice hearing, but I came away from my sojourn in America with the unhappy feeling that there economic isolationism is rampart. That is the Amercan way of life to-day.
  While I was in America I thought I would take the opportunity of going to Canada, so I went to British Columbia. I am sure that your Lordships will not think that Canada ends with Toronto. The great expansion of British Columbia is staggering. I had the opportunity of discussing at great length certain projects with the Premier of the British Columbian Government and his Ministers. There they are gasping for the export of British capital and British "know-how." In that part of the Commonwealth they are afraid that they will be overrun first with capital from other countries. It was borne in upon me and my reflections that what we in this country must do is to get back to the position we occupied before the war. So far as my knowledge of economic history goes, the physical trade balance between exports and imports was going against us right up to the war and it was saved by the interest on our overseas investments, our invisible exports and the export of British brains. That is the position to which we must return.
  From my examination of this problem I would say that the best bet we have for the export of British capital and British brains and "know-how" lies in British Columbia, in Canada and in the Rhodesias in Africa. I know the question I have asked myself and which must be in all your Lordships' minds—namely, where is the money to come from? To me the answer is simple—so simple that it will bring a smile to your Lordships'
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  faces. We are never going to get that capital by trying to get a £300 million surplus on our trade account. I say that to-day that is a physical impossibility. We are going to get that capital by a reduction of what the noble Viscount, Lord Hailsham, has stated to be the herculean burden that is resting on the British taxpayer—a reduction of the £5,000 million that is breaking us. We are the most heavily taxed country in the world. We are broken. Here are we, at this stage of our lives, supposed to be enjoying the greatest prosperity this country has ever known; and the disincentives to work or to export or to take risks which have been the safeguard of Britain in the past, mount year by year. The only increase in taxation that was made in this mammoth Budget was an increase in the profits tax, both distributed and undistributed. What an incentive to the British exporter to take risks overseas! I do not care what political ideology one has in regard to the question of profits, it is the hope of reward that sweetens labour. The British exporter has no incentive to go into these hard and stern markets, never knowing whether he is going to be kicked out from one year to another.
  Turning to the British workman, I would say that it is no good saying to him. "Invest in. success. Work and earn money", and then, when he has earned the money, saying to him, "You are not going to spend it, because we are going to increase purchase tax and the cost of living." Can you expect the British workman not to say. "All right; I have two alternatives: either you increase my wages to pay for the increased cost of living, or I do not work." What other answer is there? Where is this money to come from? I said that the answer is so simple that your Lordships would laugh. The answer lies in a reduction of the overpowering burden of taxation. The Government have given—what did the noble Viscount call it?—a squalid lottery—
  VISCOUNT HAILSHAM: With respect, I was quoting the remark of a leader of the Labour Party.
  LORD LUCAS of CHILWORTH: I do not mind what a leader of the Labour Party called it; I do not mind what anybody calls it. But it is no basis for the fiscal policy of this country. I know that

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  the noble Viscount will forgive me for saying so, but to me it is amazing that the British House of Commons—I hesitate to criticise another place—can spend so much time and that the noble Viscount can spend so much of his well-known forensic eloquence on something so trivial that I would not even mention it, and yet ignore the fundamentals of our very existence, all the things that matter, how we are going to earn our daily bread. When I come to dissect this £5,000 million the item which I pick out overwhelmingly for reduction is the £1,500 million spent on defence. I was not here, so I did not have the privilege of listening to the speech of the noble Lord, Lord Hore-Belisha, but I read it with rapture and thought it one of the finest speeches on the subject that I have ever known. What did he say about waste of manpower and money? He said [OFFICIAL REPORT, Vol. 196, col. 1229.]:
  "When I was in Malaya last year, I was told that at one time we had 70.000 troops—not only United Kingdom troops, of course, but local troops and police forces as well—engaged against some 3,000 bandits. It has been stated that in Cyprus there are only about 65 well-trained gunmen, supported by a rabble; and against these we have 20,000 soldiers and 3,000 police, with a Field-Marshal in command."
  That is how the British Army, with the addition of other Services, is being used to-day; and for that the British taxpayer pays £1,500 million a year.
  On Saturday, in what I thought was one of the best leaders in The Times I have read for a long time, the question was asked: "How much is enough?" The leader was commenting upon a speech by the noble and gallant Field Marshal, Lord Montgomery, and said:
  "There are times when Field-Marshal Montgomery is not above trying to make our flesh creep in the interests of defence."
  The noble and gallant Viscount had said that nobody in Europe is doing enough, and that some nations are not doing anything, about civil defence; and The Times asked the pertinent question: what is enough? What is within the realms of possibility? I expect some of your Lordships will have read this leading article. I hope all noble Lords will read it. It ends:
  "Whilst it is the duty of a commander of Lord Montgomery's stature to sound a warning when he considers it necessary, there are other
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  more pressing dangers that lack such a publicist."
  I am not seeking to fill that rôle. The article goes on:
  "One is that preparations for fighting a total war could bankrupt the West; another is that by concentrating our attention on the remote danger of total war we could, in the meantime, lose the cold war by default."
  The "cold war" is the economic war. I may be told by the noble Earl, and by many other noble Lords far better versed than I am in military strategy, that all this expenditure is necessary. If that is true, my reply is: then do not think that ever in the lifetime of anyone in your Lordships' House we are going to get out of this economic crisis. We shall live with it for the rest of our lives.
  I do not think many people in this country fully realise the danger of our present position. We are almost bankrupt. I do not know how long we can go on. We have no chance of seeing any remission of taxation when we are driven to having to put up taxation by one-half of 1 per cent.; mortgaging our future to keep alive; trying to be a great military nation, policing the world, when we have not the physical capacity to do it. The noble Lord, Lord Rea, talked of trade unionism. Why is there all this trouble on the question of automation in a certain factory in Coventry? It is because, in his heart, the British working man does not believe that there is such a thing as full employment, and he is afraid. He sees the spectre hovering in the background and fears that one day he is going to stand once again in an unemployment queue. That is our basic trouble.
  When I was basking in the sunshine of California and in the economy of America I saw that America has an entirely different philosophy on this question, and the Americans cannot understand why we do not do the same as they do. "Spend your way out of depression," is what they say. When I asked, "Do you think this will ever last? Do you not think you are going to get a bump?" they said, "We may get a lot of bumps, but we get a lot of ups. The trouble with you folk is that it is all bumps." How true! When I think of the wastage such as the noble Lord, Lord Hore-Belisha, pointed out,

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  I recall a speech by the noble Lord, Lord Mancroft (I am sorry he is not here this afternoon), when he used to regale us with speeches from the Back Benches. That particular speech has always stuck in my mind. Speaking from personal experience, he said that the trouble with the Army is that they always send five men to do one man's job, and when they get there they find there is not even a one-man job to do. To-day they do not send five, they send ten. Look at the colossal wastage in the Royal Air Force! We are spending millions of pounds on aircraft that are out of date before they come off the drawing-board. Yesterday there was an air crash involving one of the most obsolete types of aircraft which the Royal Air Force has still in use. I live within shooting distance of Transport Command, and twelve months ago the self-same model of that aircraft was flying round and round training pilots. All it was doing was wasting the taxpayers' money. Now the fifth such crash has taken place. Yet when I raised the question of obsolescence and danger I received a "dirty answer" from the Air Ministry.
  What greater service could we do in regard to the imports question than produce more food in our own country? We are ploughing up the land, but what are we sowing? Concrete! Miles and miles of concrete, to take bigger and better bombers, to carry bigger and bigger atomic weapons which will never be used. I am one of those peculiar people who have never believed that there will ever be a shooting war. I should think our two visitors from Russia must have laughed to themselves, as they went back home thinking how successful they had been in. frightening the Western world into spending so much money on war-like preparations. Your Lordships may differ from me, but at least this has always been a House in which a man can speak his mind with sincerity.
  One of the greatest competitors we have ever had in the export market since the war is Western Germany. We have 280,000 of our best youth stationed there, at a cost of millions of pounds, while until the other day not one of the young men of Western Germany had been put into uniform. We are still supposed to be receiving £50 million a year to defray the cost of maintaining British troops
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  over there, and the first thing the authorities in Western Germany do is to reduce their income tax. Does that add up to sense from our point of view? All the time we are carrying this load!and I cannot see that in my lifetime the burden of taxation in this country will ever be much less!while the incentive to work, the incentive to risk, has gone. We should get back to some of those principles which we learned years ago!notably that it is the hope of reward that sweetens labour. All we get is exhortations. The only incentives offered in the Budget were what the Economist described as incentives to gambling arid procreation. There was no incentive to work harder; no reward for working harder. There was an added burden upon the industries of this country—a disincentive.
  When I was in His late Majesty's Government I learned, in all my connections with the inner circles of Cabinet Committees, this lesson: that if we attempt to plan the peace-time economy of this country on a war-time basis the end, inevitably, will be bankruptcy. And we applaud a Chancellor of the Exchequer whose sole contribution to the solution of this dire problem!and it is the only solution he puts forward—is the saving of £100 million. Chicken-feed! And while the Chancellor of the Exchequer is saying twat, the Army, the Navy and the Air Force are making up their minds that they are not going to be quite so silly as to have economies in their individual Services. To-day we see the Air Force taking over land, and building houses for greater numbers of personnel, when the crying need is that they should have half what they have and use it better.
  I am grateful to your Lordships for your patience and your tolerance in letting me say this. I believe that I am voicing the thoughts of thousands and thousands of people in this country. We have been in the grip of a military economy ever since 1939. When we had the greatest military strategist in the world as a Prime Minister, I could not hope for any respite; but I did hope that the present Government, under new leadership, would be able to provide a solution to this problem. But to-day we find ourselves without any hope and in greater trouble than ever. The only chance I see of this country getting back

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  its prosperity, and keeping its standard of living at a decent height, is to export its brains and its capital, and to acquire its capital from the savings of the Government. But the Government export everyone to save except themselves. Whether we like it or whether we do not, if we go on spending £1,500 million trying to live up to the old-fashioned idea of being a great military nation the end is inevitable. If the answer of the noble Earl who is to reply to the debate should prove to be that this state of affairs must go on, then I see no hope for the future.
  4.25 p.m.
  LORD CHERWELL: My Lords, I will not endeavour to follow the various noble Lords who have spoken. There are so many topics that might be raised. I will not break a lance for tax avoidance, but I should like to recall to the noble Lord, Lord Pethick-Lawrence, that its charter, I believe, derives from a statement of that great Socialist Lord Chancellor, Lord Sankey, who said that everyone is at liberty so to arrange his affairs as not to draw upon himself the incidence of taxation. I will not go into the question of Russian trade, for though the figure which has been mentioned, covering a period of ten years, sounds quite a lot, in fact it is something like 2 per cent. of our total trade, even if all the allowances for which the Russians have asked are made. I will not follow the fireworks of the noble Viscount. Lord Hailsham, though I very much agree with a great deal that he said. I think another argument he might have used was that a Neolithic man who withheld his seed corn from his family in order to plant it on the gamble that he might get a bigger crop probably ought to be condemned. I do not quite know by what means the Church proposes to settle who is to bat first in the Test matches without going into the wicked gamble of tossing a coin.
  I was much interested in listening to the noble Lord, Lord Lucas of Chilworth, and to the tribute which he paid to the capitalist American economy and the great prosperity derived from it. His desire for lower taxation, of course, is shared by all of us. I do not think I had better start on any of the long arguments about armaments, a subject which has been discussed among other questions.
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  That might lead me much too far. I entirely agree with the noble Lord that one of our great dangers arises from failure to pay for imports by our exports. The deficit that has arisen this year is in the main due to the increase in imports. Whilst the value of our exports, visible and invisible, rose between 1954 and 1955 by 3·3 per cent., the cost of our imports rose in the same period by 13·4 per cent. Instead of a surplus (taking Government expenditure abroad into account) of £155 million, we therefore had this deficit of £147 million. Obviously, that sort of thing spells bankruptcy. However unpleasant the remedies, it cannot be allowed to go on.
  The main reason why we have imported so much, as has often been said, is that we have tried to do too much and live too will. We have been building and equipping factories and increasing stocks; we have erected schools and hospitals, not to mention dwelling houses and cinemas; and at the same time we have improved our living standards. If we had increased productivity equally fast or made corresponding sacrifices in consumption, as they seem to have done in Russia, all this might have been manageable. But we did not; on the contrary, we spent on consumption £794 million more in 1955 than in 1954.
  On the family scale all this is elementary. If you want to get your shop enlarged or your house redecorated you will have to find the money to pay for it. If you have savings you may use them up or you may mortgage your future by getting an overdraft from the bank. But unless you resort to this, you will either have to do without your new car or radio, or drink and smoke a little less, or refrain from building and decorating. The nation does not seem to realise that exactly the same thing holds true in the case of the country as a whole. As a country, our savings, our gold and reserves, are woefully low. Indeed, they should be described as working capital, not as savings. Compared with the volume of our business, they are definitely far too small to give any security in the case of unfavourable turns of fortune. As for getting an overdraft, I am afraid that long ago we exhausted the patience of our American and Commonwealth bankers, though

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  happily not their great fund of courtesy and friendship.
  Therefore, we are inevitably thrown back or cutting down demand at home!in other words, reducing expenditure!and this, of course, is what the credit squeeze is for. Naturally, it is bound to be unpleasant. Its object is to prevent people from buying things they would like to have. Short of reintroducing rationing and the like, the only way of doing this is to make goods less attractive by taxing them or by making it harder for people who would be prepared to pay the higher prices to borrow money to pay for them. Unfortunately, the squeeze is bound to operate throughout the whole economy, so that sometimes people might be discouraged from buying goods that help production in the same way as people are discouraged from buying inessential and luxury goods, and it is bound to cause inconvenience and, occasionally, even hardship. At any rate, it seems to be working and our trade balance seems to be slowly improving.
  In these matters Government measures can make a real difference, but it is far more difficult to see how the Government can cope with what I consider to be the even greater danger—that is, inflation, the constant rise in prices. I know that people in authority, or hoping one day to be in authority. have to express themselves carefully, and politicians dependent on a popular vote may be shocked at the frankness of what I am about to say, but I have no hesitation in asserting—and I invite contradiction on the part of the noble Lord, Lord Pethick-Lawrence!that the rise in prices is due almost entirely to the fact that earnings have risen faster than output. It is no use being mealy-mouthed about this subject. When we come down to fundamentals, at least 90 per cent. of the cost of the average article is the cost of the labour needed to produce it, distribute it and sell it to the public, and of course to maintain the equipment required to make it. The only part of the cost that in the long run does not go back into wages or salaries in one form or another, apart from the trivial fraction paid in rent or royalties, is the quantity distributed in the form of dividends to people who have put up the money to build a factory and equip it and who risk their savings so as
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  to make production possible; and this, when taxation is taken into account, is not much more than 3 per cent.
  The relation between wages—in Which, of course, I include overtime earnings!and prices is complex. If earnings go up without a corresponding increase in output, obviously the cost of manufacture must rise. But there is another aspect. If the people have more money to spend than there are goods for sale in the shops, nothing will prevent them from outbidding one another and thus forcing up the prices. Short of general rationing and controls, the law of supply and demand is bound to win. This situation is admirably high-lighted in the March Bulletin for Industry, which your Lordships have no doubt seen. It is shown there that the weekly output per employee in the United Kingdom has gone up in the last five years by only 9 per cent., whereas weekly earnings have gone up by 45 per cent. As a consequence, in the same period prices have gone up 30 per cent. In West Germany, weekly output has gone up 40 per cent. and weekly earnings 42 per cent. and, in consequence, prices have risen by only 8 per cent. Could there be a clearer or more definite relation exhibited between prices and wages? If earnings go up faster than output, nothing any democratic Government can do can possibly prevent prices from rising, short of such a violent deflation as to cause enormous unemployment. Only in a totalitarian State, with direction of labour, pegged wages and rationing, and all the rest of the paraphernalia of compulsion, can prices he kept down by Government action.
  It is sometimes pretended that it is an open question whether prices chase wages or wages chase prices. Frankly, to put it mildly, this is a meaningless question. If wages rise without a rise in output, prices simply must go up. It is merely a matter of arithmetic. Short of extra taxes and subsidies, there is nothing anyone can do about it. You cannot force anyone to manufacture at a loss. Whether wages will rise when prices go up is a totally different matter. It is a psychological or perhaps a political question. If the wage earner really understood the appalling danger of the inflationary spiral, he would realise that a rise in wages would riot improve his position. Again, if we had unemployment

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  on a considerable scale, as is bound to come if the wage-price spiral continues, he could not enforce his demands. In other words, if wages rise, prices must rise; but if prices rise, wages could remain fixed. Only if they do will the inflationary spiral be halted.
  Some foolish people think that these difficulties could be avoided by monkeying about with currency. I am glad that the noble Lord opposite shakes his head. This is a very old fallacy. Some temporary trading advantage may be gained by devaluation, but this is only transitional while things are getting into adjustment. If we devalued the pound we should get less goods for every pound's worth of goods we exported, so that we should be worse off than ever. There is another, and perhaps even graver, danger. Any sort of devaluation or hint of devaluation of the pound would inevitably shake confidence in sterling. Members of the sterling area, on whose behalf we hold, I suppose, a thousand million dollars, would inevitably be tempted to place their reserves of gold and dollars elsewhere and the sterling bloc would disintegrate. If London, instead of being the banker of the sterling area, merely represented the United Kingdom in financial affairs, disaster would stare us in the face. In the long run, our imports must be paid for by exports. That devaluing the pound would enable us to get something for nothing is a delusion. Such a measure, perhaps even such a proposal, might well set us on the road to galloping inflation.
  The Germans had some experience of this in the early 1920s. The value of the mark dropped so fast that on payday wage-earners rushed off on their bicycles to buy anything, whether they wanted it or not—even railway tickets to anywhere—rather than hold depreciating bank notes. Indeed, people in restaurants were advised to order and pay for all the food and drinks they were likely to consume during their stay as soon as they sat down to table, since prices might well have doubled by the end of the evening. It sounds a joke, but they did not find it so. Most of the Germans who lived through inflation agree that it was far worse than the war. The terrible memories of it which remain may well be the reason for their admirable self-
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  discipline in demanding increases in wages only corresponding to the rise in output.
  It is because of this close link between wages and prices that the round of wage increases this spring gives so much cause for anxiety. Almost certainly this will cause a rise in prices in the autumn, and we shall again have the trouble-makers blaming the Government for it and inciting the workers to demand consequential increases in wages. And, of course, as I have said, if wages are raised again, prices are bound to follow. Normally, of course, employers have to resist wage demands because they cannot afford to increase the costs of their products unduly. But with all the money floating around (I recall that annual earnings per employee have gone up 8 per cent., while output has gone up only 4 per cent.; and wages and salaries make up three-quarters of the disposable income) this argument loses its force.
  It must be admitted that some employers are short-sighted. Many factories are engaged in finishing semifinished materials. In these, overheads and the cost of their raw materials may well be, say, 60 or 70 per cent., and labour costs only 40 or 30 per cent. The employer may say to himself that a 10 per cent. rise in wages will therefore raise the cost of his product only by 3 or 4 per cent., which the market can stand. He forgets, or does not take into account, the fact that this same argument is apt to apply all down the line, and that the labour costs in the factories producing his semi-finished raw material will also be forced up, so that the final cost will rise by something very like the 10 per cent. he has conceded.
  For his part, of course, the temptation to ask for higher wages is strong to a working man who does not realise the danger of the inflationary spiral. If the trade union leaders, who understand the true position, try to restrain their men they are overborne by unofficial strikes. These are usually led by Communist shop stewards, who seem to have an inexhaustible fund of enthusiasm and energy which enables them to attend all the factory meetings and get themselves elected, usually by a very small fraction of the total membership, to positions of influence and authority. This seems to me to be one of the great dangers that confront us.

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  If the trade union leaders who really understand the situation could control their members, something might be done to prevent the inflationary spiral bringing us all to disaster. But it is not a very easy subject to explain to working men, who are naturally usually much more interested in cricket and football, and perhaps even football pools, and the like; and the Communist trouble-makers can always discount a leader's arguments by saying that he has been nobbled by the employers.
  The next decade will show whether parliamentary institutions can survive the stresses which modern conditions of transport and industry and manufacture bring in their train. Democracy is supposed to be the rule of the majority. Yet vast numbers of people, the whole of London, sometimes even the whole nation, is at the mercy of a tiny fraction of the population, very often only some tens of thousands of men. Last year's dock strike, due to a quarrel between two unions, cost the country, probably, £200 million. And this is only one example of the way in which quite small numbers of men, usually worked up by subversive elements, can hold the whole community to ransom. If this is not the law of the jungle, I do not know what is.
  It is sometimes said that we ought to have a labour policy with a basic wage related to prices and agreed differentials for different jobs with long-term engagements, and enforceable penalties against both sides for breach of contract!that is to say, for strikes or lock-outs. But I doubt whether there is any prospect at this time of getting general agreement on any course of this sort. There would be all too much scope for misrepresentation; it would be all too easy for trouble-makers to organise unofficial strikes and bring the whole plan into disarray and disrepute. Only a change of heart of the population can save the situation. If the working man realised what is at stake, I am sure he would respond, as he has done in every crisis in our history. But he is easily led astray by the enemies of democracy into believing that he should try to get as much as possible for doing as little as possible. Only if men once again take a pride in their work, and resolve to make as good a product as circumstances allow; only if there is a return of the old-fashioned outlook, that a man should be
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  ashamed to take an honest day's pay unless he has done an honest day's work, can we hope to recover from the insidious malady by which the country's economic future is threatened.
  I am afraid that in what I have said there has been nothing new or striking but a thing can be trite and yet true. In fact, I am sure that the leaders of the Labour Party would not seriously dissent from it. They know perfectly well that a nation's standard of life cannot be determined by a majority vote; that we can consume only what we produce, and that if wages are increased, prices must rise. To insist on these facts does not tend to enhance one's popularity. A patient who is told that he ought to give up his favourite diet is apt to take a dislike to his doctor, and may even call in a quack. But a doctor's first duty is to his patient. I hope, therefore, that the labour leaders will play their part, even though it be unpopular, in explaining the true position to their followers and in curbing the irresponsible elements who are inciting the wage-earners to pursue the road to ruin. For unless a stop can be put to the inflationary spiral, democracy in this country cannot survive.
  4.48 p.m.
  LORD CONESFORD: My Lords, the House is once again greatly indebted to the noble Lord, Lord Pethick-Lawrence, for initiating an important debate. As one who always listened to him with interest in another place for many years, may I also record my particular gratitude, because this is, I think, the third occasion on which I have ventured to address your Lordships in a debate which he has initiated. I shall take great care not to repeat what I have urged on the two earlier occasions, though I may say that I stand by every word of what I then said. Before I embark on the ma in subjects on which I intend to speak, I would say a word or two about a matter raised by the noble Lord, Lord Rea!namely, the question of travel allowances. It may be that a more appropriate occasion will arise for discussing that particular topic, but I listened with great interest and sympathy to what the noble Lord said to-day.
  I have always thought that the present limitation on foreign travel imposed on the ordinary person was a much greater evil than was generally supposed. I

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  spoke on this subject when the Exchange Control Bill (now the Exchange Control Act) was going through another place, and I moved an Amendment to give the right to foreign travel. I think that one of the injuries the restriction does is to our whole conception of freedom in a free society. After all, what does it involve? It involves an arbitrary choice by the Government of the day between the people's pleasures. By what system of justice can it be alleged that the trash of Hollywood is a necessity but that a visit to France is a luxury? Only by an act of tyranny—the ipso dixit of the Government. Let me say at once to my right honourable friend, who I know will not be unduly troubled to reply on this particular topic, that of course every fair-minded man realises that in present circumstances the Government must take precautions against the export of capital; but I agree with a great deal of what the noble Lord, Lord Rea, said about the possibility of relaxing this limitation on foreign travel. I was glad to see that I have received substantial reinforcement this afternoon in what hitherto has been a fairly lone fight on my own part, though supported, and eloquently and ably supported, by two articles in the Economist newspaper.
  On the last occasion when the noble Lord, Lord Pethick-Lawrence, moved the same Motion that he has moved this afternoon, on March 7 of this year, I said something of the importance of encouraging production, encouraging savings and showing, at long last, some appreciation of the plight of the middle and professional classes. I find that I used these words [OFFICIAL REPORT, Vol. 196 (No. 68), col. 205]:
  "For them, it is urgently necessary that provision should be made in the coming Budget so that they can at least provide for their own pensions in old age."
  I referred to the expert reports the Government had received showing how this could be done. May I therefore say at once how much I welcome the start that my right honourable friend the Chancellor of the Exchequer has made towards carrying out the recommendations of the Second Report of the Millard Tucker Committee. This I believe to be the most important and potentially the most beneficial of all the Budget proposals. I hope that my right honourable
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  friends will not think me unduly critical if I say that I think the Chancellor of the Exchequer ought to go a little further even in the present Finance Bill. I hope he will carefully consider, as I am sure he will, whether he must reject a recommendation that was common to the Millard Tucker Committee and to the Royal Commission on the Taxation of Profits and Income, that part of the permitted benefit might be, subject to a maximum limit, a lump sum payment.
  The Chancellor of the Exchequer rightly laid emphasis on the important part savings played in this Budget. I think most of the proposals he made regarding savings have been generally applauded. Indeed, I think that the only controversial measure he has proposed is this matter of premium bonds. My own view on the moral question some people believe to be raised is that I agree with what was said by the right reverend Prelate, the Lord Bishop of Carlisle, on February 8 this year, when he said [OFFICIAL REPORT, Vol. 195, col. 822] that
  "gambling is not intrinsically evil."
  I believe that to be the true view, and it was supported with eloquence and wit this afternoon by my noble friend Lord Hailsham. To do the most reverend Primate the Lord Archbishop of Canterbury justice for what he said on April 26 of this year, when he objected to the Budget proposals, he did not suggest—indeed, he could not have suggested—that his objection was based on Christianity.
  I believe that the wisdom of the Government's proposals will be judged by their success. Will they persuade people who would not otherwise save to do so? I shall not develop that matter further, after the most eloquent and witty speech of my noble friend Lord Hailsham, except to say this. What passes all understanding is that the Government should be so schizophrenic as to seek to encourage savings, if lent to the Government, by a controversial lottery and at the same time to discourage savings, if invested in productive industry, by a further attack on the distribution of profits to shareholders. I shall not again re-state the overwhelming case against the differential profits tax. That case has been cogently stated by the Royal Commission, and the Royal Commission's recommendation of

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  a single tax on corporate profits has been supported by an immense volume of economic authority, including Sir Oscar Hobson, the Economist newspaper and many others.
  In two successive Budgets the Royal Commission's advice has been deliberately flouted, and on this occasion no reason of any kind has been given. Her Majesty's Government must not be surprised if, in the circumstances, there is a growing opinion that their motive in this strange affair is stupidity for its own sake. I must admit that one other motive has been suggested. It is believed in some quarters that the attitude of "Let's be beastly to the shareholders" will conciliate the Opposition and convert them from advocating universal State-ownership and control to belief in a free society. Of course, it will do nothing of the kind: it will merely incur their contempt.
  In the debate in another place, it is true, an ex-Chancellor of the Exchequer praised my right honourable friends the Lord Privy Seal and the Chancellor of the Exchequer for following his lead and for rejecting the considered advice of the Royal Commission. He referred, in a most illuminating phrase, to profits being (I quote his actual words) "dished out to shareholders." When I read that speech I was reminded of a story which was current in the Temple in my early years at the Bar. It was about our fellow-practitioners of Lincoln's Inn. At the time a case was in progress in the Chancery Court on the construction of a will, and a great number of counsel were engaged representing various interests. At the end of the third day there was a rumour that the case might be settled. A conversation was overheard between two counsel returning to Lincoln's Inn, and one said to the other: "If this case is settled, the whole estate will be frittered away among the beneficiaries." That is precisely the attitude of Her Majesty's Opposition to the distribution of dividends to those entitled to them.
  What makes the thing the more strange is that several Members who speak with great authority for the Socialist Party in another place deplored the fact—as it is deplored by many in all parts of the House—that not so great a proportion of the national product as they would like was devoted to new machinery and the re-equipment of industry. But why on
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  earth should any company devote money to re-equipment if the shareholders are never to receive any benefit from the investment? Of course, some of these honourable and right honourable gentlemen may think, "Oh, that is a great objection to private industry continuing to exist, but it can all be remedied by nationalising everything and then you can re-equip without consulting the shareholders." Can you? I remember the enchanting declaration, for which I cannot at the moment give a date or a place, of a Finance Minister who fell from office, dismissed, I think for incompetence, in a Communist country behind the Iron Curtain. He said, after his dismissal, "I made the mistake of nationalising industries too rapidly so that there was no private industry left to make profits to pay for the losses on what I nationalised."
  In dealing with the question of dividends, in case anybody thinks that there is something to be said for the general policy of "Let's be beastly to the shareholder," the Government themselves have recently shown in two publications that wage and salary-earners are, in real terms, 40 per cent. better off now than they were in 1938, whereas shareholders are 30 per cent. worse off. I cannot think that there can be much case for increasing this disparity—certainly not in the interests of justice, though it is sometimes alleged that something on these lines should be done in the interests of social justice. As one who spent some years in the service of the law, I think I have sonic idea about what is meant by justice (at any rate, I have a great admiration for the Common Law of this country), but I have always been puzzled to know precisely what was meant by social justice. I have come to the conclusion, which I declared some years ago in another place, that social justice bears the same relation to justice as social credit does to credit.
  My Lords, I was glad to note that in the debates in another place, several Ministers expressed their determination to conquer inflation. I am delighted, and, of course, I accept entirely their sincere determination to do so. It is vital for our survival that they should succeed, but I hope that they will not underestimate their own responsibility. There is everything to be said for enlightening the public about the facts, but it is utterly

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  wrong to think that exhortation of others can relieve the Government of their own responsibility. I hope that Ministers no longer share the illusion—after recent events I do not think they can—that their task will be done for them by the trade unions or their leaders. It is quite useless —indeed I myself think it is unfair—to ask trade union leaders to refrain from putting forward a claim for increased wages so long as it remains true that, if such a claim is put forward, it will certainly be granted.
  I do not believe that we shall conquer inflation, which constitutes the greatest of all risks to the future employment and prosperity of our people, unless we learn to distinguish full employment from over-full employment. I hope that those noble Lords who did not hear the speech of my noble friend Lord Salter on March 8 this year will read it in Hansard, because he dealt, as the House then thought and as I know all who have studied it think, so admirably with this question of the distinction between full employment and over-full employment. Perhaps I might quote just one sentence in which he referred to what the late Sir Stafford Cripps had said on this subject [OFFICIAL REPORT, Vol. 196 (No. 68), col. 250];
  "Then, a few years later, in 1949, Sir Stafford Cripps, having experienced the consequences of people thinking of full employment as meaning not a single person ever without a job. was careful to say that full employment did not mean that an individual was guaranteed continuance in his particular job or even his particular trade, and that to insist upon the rigid maintenance of the present pattern of employment would be to destroy all hope of full employment."
  Some of us have had the experience, either in another place or when speaking in constituencies at General Elections and at other times, of finding that whenever a Conservative speaker has spoken of over-full employment, he has run a serious risk of misrepresentation. It is often suggested that what he really wants is unemployment. The suggestion is completely false. It is obvious, indeed, that if we had the waste of unemployment we should stand little chance of surviving our present difficulties.
  But let me deal in the simplest way with the task confronting any Conservative who is misrepresented in this way. Let me inform the House of what I believe to be the first occasion on which
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  a Minister of the Crown described our state as one of over-full employment. It was done by Mr. Herbert Morrison in a Press conference on August 20, 1947, at the time when he was Lord President of the Council. For the convenience of your Lordships I have procured the comparative figures of the rate of unemployment, first, when Mr. Herbert Morrison, as Lord President of the Council, described our condition as one of over-full employment; secondly, in the corresponding month last year, and finally, the most recent figure. In August, 1947, the number of unemployed represented 1·5 per cent. of the working population; in August, 1955, they represented 9 of 1 per cent. So, if Mr. Herbert Morrison was right in describing the conditions in August, 1947, as conditions of over-full employment, how much more so was that true in August of last year! The figure for March, 1956, is the most recent that I have obtained, and is 1·3 per cent. I have given a summer figure as well as the latest figure, because, as noble Lords in all quarters are aware, there is a seasonal change in these matters: unemployment goes up in the winter months and down in the summer. So the comparative figures are: August, 1947, 1·5 per cent.; August, 1955, 9 of 1 per cent.; and March, 1956, 1·3 per cent. No Conservative, therefore, need be in the least afraid of describing our position as one of over-full employment, when, by the express statement of one of the principal Ministers of the Socialist Government, a condition when there was greater unemployment could be justly described as over-full employment.
  In every economic debate in which I have taken part, I have made a plea for the middle and professional classes. I do so again. I believe that the greatest defect of the present Budget is its failure sufficiently to lighten the burden on these overtaxed men and women, more heavily taxed than anywhere else in the world, and thereby to encourage the contribution that they can make to productivity and success. I wonder whether even today, the Government are alive to the threat to our future unless something is done quickly.
  I hope that noble Lords will have noticed a letter that appeared in The Times on April 11 of this year. It is

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  signed by Mr. Barclay Inglis and contains two paragraphs. In the first he draws attention to the nation's
  "desperate shortage of highly qualified scientific, technical, and administrative personnel",
  and mentions some of the steps recently taken to deal with this matter and to obtain new recruits. He refers to
  "the first grants from the £3,500,000 Industrial Fund for the Advancement of Scientific Education in Schools",
  Then he says that almost at the same time
  "it was reported that an American corporation had retained the services of a London employment agency to find executives and technicians for vacancies in South America at salaries ranging from £5,000 to £17,500 a year."
  The second paragraph of his letter is as follows—I propose to read it verbatim:
  "It is surely less than logical to restrict the export of the obsolescent armaments of yesterday while permitting free trade in the technologists to whom we shall look for the design and production of the machines of tomorrow, and it would appear, Sir, that a system of export licensing is called for to prevent the further depletion of our stock of these men, until such time as industry begins to offer them comparable pay in this country."
  I hope that the writer was being ironical. Having asked many people who read that letter to give their view, I can only say that the majority did not understand this to have been written in irony. In case anyone understood him literally, in case he intended what he said to be taken literally, I would point out that in the passage I have read he was treating men as things, things in which one could trade and of which there were stocks. He was treating men as if they had no natural right to the choice of what they did or the nature of their work. That is not the language of those who would preserve a free society. In the march to 1984, it may be later than you think.
  5.14 p.m.
  LORD ROCHDALE: My Lords, I listened with the greatest interest to the speech of the noble Lord, Lord Lucas of Chilworth, and with much of what he said one could not but agree. I must say that I envied him his months in California, I hope he put them to good effect—he certainly seems to have done so. With much of what he said I agree, and I am not going to follow him in all he said about defence. But I must comment on one aspect of his remarks, and that is his reference to our exports to
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  dollar markets. I entirely agree with him, of course, that our exports to dollar markets leave a tremendous amount of room for improvement, but we must be careful to get the matter in the right perspective. Do not let us forget that, taking our exports as a whale last year, all over the world, we had an all-time high record. That is something to be borne in mind when considering the exports to one particular sphere or part of the world.
  When we come to Canada—and, as the noble Lord probably knows, I myself was in Canada earlier this year at discussions to see how we could increase our exports to Canada—certainly there is a great deal that could be done. But what I think it is important for us to know is that there are eminent Canadians over there who feel exactly the same as we do, and who are making tremendous efforts to try to encourage not only us to go over there and sell to them, but their people to come over here and buy from us. And I hope that, between us, we shall be able to make improvements.
  LORD LUCAS OF CHILWORTH: I am most grateful to the noble Lord. If I gave the House the impression that I was including Canada in what I said, I am sorry, The noble Lord is quite right: the Canadian position is entirely different from the American position. I was rather thinking of the American dollar exports and not the Canadian dollar exports.
  LORD ROCHDALE: I was coming to American dollar exports in a moment. Curiously enough, the figures for our exports to America last year were very much better, and the total figures were very much better, than our exports to Canada. But there again, there is room for a great deal of improvement. I would only add this further word on that subject. The noble Lord took the example of cars. I was rather surprised, incidentally, that, having come back from the United States, he was not talking about "automobiles"—but that is by the way. I am not sure, however, that cars are a very good example to take, because while they are a very important item, they are a very large one; and I am quite sure that some of the advantage we can gain from our exports to the United States rests in a large variety of smaller items. In fact, I think it would be a surprise to many of your Lordships to

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  see the immense variety of exports, often in quite small packets, that go to build up our figures to the United States.
  That is all I am going to say on that matter, but it leads me on to the main point of what I want to say to your Lordships, bearing on exports—the question of investment in our industries at home. I suppose there is none of us here who, if confronted with the simple question taken out from any other context, would not recognise the importance of adaptability, inventiveness, ingenuity and all that in our industry; no one would question the importance of these qualities. No one would but agree that, to achieve them, we must put aside adequate investment. I have no doubt that people would say to that question: "What a silly question to ask! The answer is obvious."I agree that it ought to be obvious, but I am quite certain that there are others besides myself (I rather fancy that here the noble Lord, Lord Lucas of Chilworth, will agree with me) who are somewhat concerned whether the importance of this question of investment in productive industry is fully appreciated; whether we give sufficient attention to it or whether we are not, perhaps, rather inclined to take it for granted.
  A few years ago, at the time when private industry was being criticised for not investing enough, as compared with nationalised industry, in new machinery and plant, when Mr. Butler introduced his investment allowance, there were those who said, "This is only a small item; it will not do very much good." I myself took the other view, and I believe I was right, because in fact that allowance did a great deal of good and was an excellent thing. If I may take an analogy, I believe it acted as a catalyst does in chemical processes: it set in motion a whole chain of reactions which, in the long run, brought about a considerable amount of industrial investment. Whilst the increase in industrial investment in this country has been quite remarkable over the last two or three years, we have to remember that it is only remarkable in relation to where it started—which was at fairly low level. Therefore, it is not really anything like enough at the moment. That being so, I should have thought that we cannot possibly allow ourselves any let-up in
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  this matter. If the investment allowance acted as a catalyst, as I believe it did—something small setting in motion a whole lot of other things—there is in the other direction a serious danger that anything done to damp down investment, however small it may seem, might easily, in the end, have a most unexpected and unhappy result.
  In our last debate on March 8, in which I did not take part, my noble friend Lord Jessel raised this question of the level of investment. My noble friend Lord Selkirk, in replying to him (I say this with the greatest respect, because I always listen to my noble friend's speeches with great interest, as they carry great weight) did, I think, on that occasion, slightly miss the point. Lord Selkirk said—and I quote from coloumn 186 of the OFFICIAL REPORT for that day:
  "I think that, over the whole sphere and range, capital expenditure is likely to be considerably higher this year than it was last year."
  That sounds very nice, but to my mind it is no use saying that investments will be bigger this year than last year, because industrial investment is not something that can be turned on and off at will, like a tap. Industrial investment depends on a great many things. It depends on ideas; and ideas are very susceptible to economic climate. They are susceptible not to the climate that is existing at the time when the buildings are being put up, the machines installed and the bills finally paid, but to the climate that is in existence at the time when the ideas are originally conceived. To my mind that is a most important point. The investment to which my noble friend Lord Selkirk referred, this year's investment, will have been planned some years back. What about the years ahead, if we are going to damp down to-day? If we fall back in the race here, shall we ever be able to catch up, especially at a time when, as the noble Lord. Lord Lucas of Chilworth, has so forcefully said, export trade is becoming increasingly competitive the world over?
  It seems to me that we sometimes forget that our ability to export depends not merely on how much we can produce, not merely on the price at which we can produce, not merely on what delivery we can give, but also, and perhaps even

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  more so, on design, versatility, inventiveness and imagination. Let us not forget the lesson that more than one industry in this country has had to learn in the past, in the hard way: that what may seem to-day to be the normal and proper things for us to make and export will to-morrow be the things that our customers themselves are making for themselves; and unless we are busy thinking of something to take their place we shall find that our export figures in the years ahead cannot be maintained. Therefore we must be ready, and we cannot be ready without adequate investment.
  I certainly agree with the later statement made by my noble friend Lord Selkirk in the same debate, that what we need to do is to make quite sure that one scheme does not get in the way of another so that both are held up. I recognise that the investment allowance, to which earlier I paid tribute, has only been suspended and not done away with altogether; that to some extent the loss has been made good by the reinstatement of the initial allowance, and also (and here I should like to pay a particular tribute to the Chancellor of the Exchequer) that there has been reinstated the investment allowance for furl-saving equipment, scientific research and shipping. But for all that, the fact remains that some curb has been placed on industrial enterprise and investment. That may he essential; we may get away with it somehow. But I think there is, equally, a danger that it may prove to be the beginning of a slippery and dangerous slope. I am sure all your Lordships will agree with me that it is never wise to get on to a dangerous and slippery slope, certainly not in the dark and certainly not when you are not quite sure where you are going.
  What, as I understand it, has been attempted by the Chancellor of the Exchequer, is to steer a line, on the one hand between the curbing of consumer spending, and, on the other, investment. There is no doubt that politically it is quite obvious which of those is the easier to adopt; and of course your Lordships will not mind my saying that in many ways private industry has long become accustomed to being the Aunt Sally of the country. That is a remarkable thing, but I believe it to be true. It must be most remarkable to some of our competitors, particularly those on the other side of the Atlantic to see how we treat
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  and regard our private productive industry. After all, productive industry is the only goose we possess that has any golden eggs at all to lay. How has that extraordinary situation come about? I believe that it stems from this most unfortunate bogy of private profit. Of course, there will be some, in every walk of life, who abuse their privileges, but this bogy, this attack on private profit, is most unfortunate from the point of view of the country as a whole. I would say that anyone who has at any time done anything to foster that bogy has a great responsibility to bear. I have no doubt at all—in fact, I can bring chapter and verse to bear this out—that there are far too many small industrial firms (and may I remind your Lordships that a high proportion of industry consists of small industrial firms) operating upon a margin of profit which to-day is far too small, either for their own health or for the health of the country as a whole. It is in the light of these arguments that I want to mention one or two points concerning the Budget.
  Should the Chancellor have been tougher with the private consumer, as opposed to industrial investment? Unpleasant as that would have been for all of us, if it had to be one or the other then I believe it should have been the private consumer, although I readily admit that judging from the reception of the White Paper on The Economic Implications of Full Employment and other portents that have been noticeable, there is at least doubt whether that would have been a very easy course to pursue. From what has already been said, it will not surprise your Lordships if I entirely agree with my noble friend, Lord Conesford, in what he said about the profits tax. I simply cannot understand how that could have been put up, although, of course, the amount is small —about a half of one per cent. on undistributed profits. Yet the effect is there; it is something that hits at the private industrialist who is thinking about how he can get the money to produce something new or better or cheaper.
  There can, of course, be no investment without savings, and therefore I fully applaud the Chancellor of the Exchequer's emphasis on that aspect. I do not propose to enter into the premium bonds controversy, delighted as I was with

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  everything that my noble friend, Lord Hailsham, had to say. I do not happen to be a man who gambles. The reason that I do not do so is my own business, and I do not dictate to other people whether or not they ought to follow me. It is a purely personal point of view. But, by the same token, one recognises that there is gambling and that people do like lotteries; and therefore I am certain that it was absolutely correct for the Chancellor to take the line he did. The only regret I have is that administratively, apparently, it is going to take so long to put into effect.
  I turn now to another thing I welcome in the Budget: the decision for the time being to take over the financing of nationalised industries. What I am about to say may lead to my being accused of being political, which is the last thing I wish to be in this particular content. May I quote the Chancellor of the Exchequer when he was making the point that, whatever other advantages there might be, obviously it would give him somewhat more control of investment in nationalised industries.He said [OFFICIAL REPORT, Commons, Vol. 551 (No. 134), col. 865]:
  "Still, if one actually presses the fee oneself into the piper's hand, one has a better chance of influencing the tune."
  The step which the Chancellor of the Exchequer has taken could give him better control over investment and over the balance as between nationalised industries on the one hand and the private productive section of industry on the other hand.
  No one is going to deny the tremendous importance of our basic nationalised industries—fuel, power, transport and so on. When they do not do just as we think they should, we all rather enjoy criticising, but one cannot very well criticise them in fairness unless one gives them adequate funds to make good equipment where it falls short of what is necessary. If I may draw an analogy between industry—taking the whole range, nationalised and private—on the one hand and the Army on the other, in Army jargon there is the term, "the teeth land the tail", the "teeth" being the fighting troops and the "tail" the services. Obviously, neither can do without the other: both have to be properly and adequately equipped for
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  their purpose. But if there has to be any priority, surely it must go to the "teeth". So it is here in industry. The "teeth", the fighting troops of industry, are the private section of industry that has to go out into the field and fight for export markets. That is where no second-best in equipment or investment can be allowed. Either we get the sales we want or we clear out altogether, and if that happens all these basic industries—transport, fuel and power—are of little importance to us. I should have thought that that was fairly obvious, and I am sure the Chancellor has been right to equip himself with this additional weapon so that he will have it at his disposal in the event of its having to be used.
  It remains to be seen how he uses that weapon. I am sure it will be easy for considerable pressure to be brought upon him, and where it is a case of one or the other he will be pressed to lean towards the nationalised industries as opposed to the productive industries. I very much hope that he will resist that pressure. I say that, not because I wish to favour any particular class of individual in this country, but because I believe that if he does not resist it it will be to the harm and disadvantage of everyone, whether shareholders, owners, management or employees generally, throughout industry as a whole.
  5.37 p.m.
  LORD COLERAINE: My Lords, I owe your Lordships an apology and, in particular, I owe the noble Lord who opened this debate an apology, for the fact that I was not in my place to hear the opening speeches. The reason for that was that I had a very long-standing engagement at the Mansion House which I was obliged to keep. I hope, therefore, that your Lordships will feel that what might look like a discourtesy was not intended as one, and was only an unhappy accident.
  At this hour I do not want to embark upon any detailed examination of the Chancellor of the Exchequer's Budget proposals. I have read the Chancellor's speech as carefully as I can, and in my own view, for what it is worth, the present Chancellor seems to have a clearer realisation of the dangers in which we stand and the difficulties which confront us than any of his predecessors since the war. I have considered to the best of my ability

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  the proposals he has made. Like my noble friends, Lord Rochdale and Lord Cones-ford, I do not agree with every one of them, but, by and large, I feel reasonably confident that the Budget, with the measures already taken, will do the limited job that, I take it, it was intended to do. I believe it will for the time being stem the tide of inflation, that it will ease for the time being the strain on our balance of payments and will give us a breathing space. At any rate, it does point to the right road ahead.
  But I do not believe for a moment that the Budget will do more than that, or that it intends to do more. I do not think we can expect this Budget to restore our solvency—restore it, I mean, beyond peradventure. The most we can hope for is that it will put us back to the status quo ante, to the position we were in eighteen months ago, before the present crisis began, a position which we enjoyed over a period of years—intervals of uneasy equilibrium disturbed by recurrent crises. I think that on whatever side of the House we may sit, every one of us feels that to-day we stand in a position of real danger. Ever since the war, in fact, we have been balancing on a knife edge, and even if the present Budget achieves its objectives, its limited objectives, we shall still be in very great danger.
  I believe, in spite of some evidence to the contrary, that we are in greater danger to-day than we have ever been since the war. Just how dangerous our position is two facts, I think, show. First, though world trade is going up markedly, our share of world trade is going down very markedly. And there is another straw in the wind, if you like to call it so. I read the other day that in the last three months for which figures are available exports of motor vehicles from Germany outstripped exports of motor vehicles from this country. It is a very serious thing if the figures which I saw are correct. Surely, there is only one road to safety; there is only one way we can take to get us back, not to the pre-crisis position but to a real and permanent condition of equilibrium. I do not believe that we can do it through the monetary weapon, though I think that, in present circumstances, the monetary weapon has performed great services. I do not believe that we can do it just through austerity and rest-mint, though at the
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  present juncture some degree of both is clearly necessary. I do not think that we can become strong merely through curbing personal expenditure. If that is all we have to look forward to we have nothing to work for. I do not believe that we can become strong—in spite of everything that is said about the need for saving, and recognising that everything said about it is true—merely through saving, because there is not a sufficient margin for saving. There is, I am sure, only one way in which we can get out of these difficulties that have clogged us for the last ten years. That is by increasing our income and our earnings and increasing them substantially. Of course that is easier said than clone. Noble Lords opposite, I think, believe that we can increase our national earnings very substantially by central economic planning. Personally, I do not believe that. After all, we had six years of it, and it did not do the trick. In my belief, we can get the increase in earnings, the increase in productivity, which is necessary only if each and every member of society feels that he derives some direct and personal advantage from his efforts.
  I do not believe it is any use talking widely and handsomely about our national responsibility, and about how the nation must rise to it, for the fact is that what is the nation's responsibility is no one's responsibility. That is not cynicism—unless it is cynical to recognise that we are dealing with human beings and not simply with figures of speech. I believe that we have in this country enormous reserves of character, energy and skill that are not being fully used; and they are not being used, in my judgment, for one reason, and one reason only—that is, because of the immense burden of taxation which bears down, and beats down, upon every section of the community. I know that there are some people who maintain that taxation at its present levels is not really a disincentive, but, quite clearly, there is some level at which taxation must be a disincentive. No-one, for example, would say that the State could take l00 per cent. of the national income without destroying incentives. No-one would say that the State could take 50 per cent. without destroying incentives. There is some level somewhere at which taxation does result in inefficiency and, furthermore, does lead directly to inflation.

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  There is a respectable body of opinion among economists, I believe, which holds that the maximum amount which any Government, in any country, at any time, can safely take of the national income is about 25 per cent. I said deliberately that it was a respectable body of opinion, because I first read that statement in a Fabian pamphlet before the war. But I think it is generally accepted that 25 per cent. is about the safe limit. If it is exceeded there is, inevitably, trouble. And the effect of too great a weight of taxation, of taking too great a proportion of the national income in taxation, is twofold. Both are very bad. Of course the rate of taxation we have now does not destroy incentive altogether. Clearly not. But it does blunt the fine cutting edge of it. And that is what we need—the fine cutting edge. The heavy weight of taxation does blunt the edge of personal endeavour. That is one thing which it does. The other thing which too heavy a weight of taxation does is to lead to waste and extravagance. I do not imagine that there is any businessman in your Lordships' House who has not heard, in the last few years, when some proposition is put before a board of directors—a proposition to cost, it may be, £5,000 or £10,000—someone say, "Let us do this; it will not cost us that amount. Mr. Macmillan, or Mr. Butler or Mr. Gaitskell is going to pay half."That kind of attitude leads inevitably to waste and extravagance and directly to inflation.
  If we accept the fact that 25 per cent. is the safe limit, where do we stand? My noble friend Lord Cherwell made some very telling comparisons between ourselves and Germany on the question of wage costs and prices. It is worth making similar comparisons on this question of the relative weights of taxation. In the United States of America the total weight of Federal and State taxation altogether is 26 per cent. of the gross national product. That is just a little over the margin which I have mentioned, but there is a good deal of inflation in the United States. In Germany, the total weight of taxation is also just 26 per cent. of the national product—that is Federal Government taxation, State taxation and so on. In the United Kingdom it is at least 33 per cent., and if one includes insurance contributions I should think probably it is as high as 35 per cent. In
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  the light of that comparison how can we hope to get out of our difficulties, to increase our earning capacity, our productivity, what you will, without substantial reductions in taxation? I believe it to be an absolute impossibility.
  Of course, it is not a simple matter to reduce taxation. It raises problems political, social and economic, of a severe, even a harsh, kind. Of course, if it were only a question of reducing taxation by itself, the matter would not be too difficult. But if we reduce taxation without at least equivalent reductions in Government expenditure, then, as we know to our cost, we create greater problems than we solve. The real problem is how to achieve a substantial reduction in Government expenditure. In the last economic debate in your Lordships' House I ventured to suggest certain fields of economy, and among other things I touched upon the Welfare State. If your Lordships will be patient with me for a few moments more, I should like to develop briefly the argument that I put before your Lordships then.
  My personal attitude towards the Welfare State is, I imagine, that of every Member of your Lordships' House. No one who has gone over the country today and seen how people live, the condition of their homes and children and who has compared that with what he remembers of how people lived before the war, can deny that there has been a great social advance—a very great social advance indeed. No noble Lord on either side of the House would wish to put that in jeopardy. Certainly I would not. But it is possible to accept sincerely and wholeheartedly the principle of the Welfare State without accepting in every detail the mechanism by which the Welfare State is operated at any particular moment.
  If noble Lords cast their minds back ten or twelve years ago to the days when the foundations of the present Welfare State were laid, in the days of the wartime Coalition and the first Labour Government, I think they would feel that the background against which the Government were working then was far different from the background against which the Welfare State has been operating. Towards the end of the war, and in 1945 and 1946, what was in the minds of us all was conditions as they were in the

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  'thirties, conditions of mass unemployment and fairly acute deflation. But, in fact, the Welfare State has had to operate in exactly the opposite conditions—conditions of full employment and acute inflation. I do not believe that there is any one of us, in any Party, who, if creating the Welfare State to-day, would use exactly the same plan as he used ten years ago.
  Is there any way in which we can hope to use the experience we have gained since the war so that we can have the advantages of the Welfare State without its disadvantages? I believe that there is, and I should like to put this general idea to the Government. I will ask them to look at the National Health Service and at the method by which it is financed. I know that the Guillibaud Committee have given the National Health Service a clean bill of health; but, not unnaturally, the Committee were looking at the National Health Service in the context of the national health. I would ask the Government to look at it in the context of the national economy as a whole. What has happened to the Health Service in ten years? In 1946, it was estimated that it would cost £165 million a year in 1956, it is costing £600 million a year. The curious thing is that a large number of people, probably the great mass of the population, believe that they get the National Health Service free. Of course, they do not; they are paying £660 million a year for it. Others believe that they are getting it as a result of the insurance premiums they pay. They are not. What I would ask the Government to do is to consider what the position would be if the National Health Service, instead of being financed by the taxpayer, were financed by premiums paid by the beneficiaries.
  I must make one or two assumptions which may not be justified. First of all, I assume that a premium of 4s. per head of the populat1on per week would finance, on insurance principles, the National Health Service at its present level. Secondly, I assume that in some cases —for example, old-age pensioners and youngish couples with large families—a premium of 4s. per head per week would be too high. And therefore I assume that a sum of, say, £200 million a year should be provided by the taxpayer to help finance the payment of premiums
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  in these cases. If the National Health Service were financed in this way, there would 'be a saving in taxation of £400 million a year, and that would be enough to cut purchase tax by half and take a shilling off the income tax—and that surely would be very agreeable.
  Of course, there is an evident fallacy in the argument so far as I have developed it—that is, that whether the citizen pays £600 million a year as taxpayer of whether he pays it as a policyholder, he still has to pay it. But it is not altogether a fallacy, because there are two elements in taxation. The amount is important, but the method by which it is raised is immensely important, too. I suggest that there would be a great difference in the effect upon people's minds, in particular in the effect upon incentives, if the National Health Service were financed through the payment of insurance premiums. The difference is this: if a householder pays his 4s., 8s., 12s. or 16s., or whatever it is, a week by way of insurance premiums, then, once he has worked to get that amount, once he has worked sufficient overtime, once he has displayed a little more energy than usual and earned the amount to pay the premium, everything else, though not exactly tax-free, is half tax-free, if a shilling is taken off income tax and purchase tax is halved. So, from the moment he has paid his premium, he goes ahead, knowing that of what he earns during the week he will be able to keep a much greater proportion than he does now. Under the present system, every time he works overtime he knows that the tax collector is going to take what he considers to be not a fair share of it.
  I have put this suggestion forward. A private Member of your Lordships' House is at an immense disadvantage in making constructive suggestions—probably that is why one does it so seldom; one has not access to all the facts. One's calculations have to be one's own and not those of a Department. Nevertheless, I think that if the Government would explore the possibility of financing the Welfare Slate more on the insurance principle and less on the basis of taxation, there might be a great advantage and a way might open up out of our difficulties.
  5.59 p.m.
  THE CHANCELLOR OF THE DUCHY OF LANCASTER (THE EARL OF SELKIRK): My Lords, I should like to thank all the noble Lords who have spoken this afternoon. It is of great value to hear the frank and independent opinions of noble Lords who speak with great authority, who are tied to no Party and who say exactly what they think. At the outset, I should like to answer the question which the noble Lord, Lord Pethick-Lawrence, posed: whether inflation to-day is so far under control as to justify letting up. I give him the unequivocal answer he gave himself: no, it is certainly not.
  I should like to expand some of the reasons why that is our view. There are a number of favourable signs. For instance, the gold reserves, as the noble Lord said, have risen. But it is worth remembering that they are still £70 million below the level of the reserves we had in 1945; and, moreover, unlike our position at that time, we now have an annual payment of 200 million dollars to make to the United States of America. I can say, however—and this is good news—that to-day the results for April are announced, and they show an increase in our gold and dollar reserves of 50 million dollars, which is satisfactory. Our foreign exchange rates have been remarkably steady since the autumn Budget and have remained almost continuously in the upper half of the official rate bracket; and, perhaps almost equally important, transferable sterling is moving up now well into the bottom of the official exchange bracket—it is now 2·785, which I understand is the highest since May, 1954. The point made by the noble Lord, Lord Cherwell, about the significance of sterling, is of tremendous importance.
  The trade figures for February and March of this year are encouraging. There is in this country an easing of demand in the industries producing consumer durable goods; that is to say, those metal industries where we are particularly anxious that there should be a certain amount of easing of pressure. There has been a reduction both in bank advances and in deposits over the past twelve months, which is to the good; and production continues to rise. Your Lordships may have observed the comment of the Chancellor of the Exchequer when
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  he said that our deficit last year of £103 million represented an overspending of 2d. in the pound. That, I think, indicates that over the whole population it is quite clearly capable of rectification; but, bearing in mind the narrowness of the margins we are working to, I feel that it must be regarded as serious and indicates the delicacy of the balance that the Chancellor must exercise in the decision which he comes to.
  Now may I turn to one or two points that are not quite so favourable. The first is the level of retail prices. They remained remarkably stable from November until March, when they rose two points. The demand for labour still considerably exceeds the supply; that is to say, vacancies are much more numerous than the number of unemployed. In the early part of this year personal incomes have been rising faster than prices or than production. Indeed, I think it is fair to say that recent wage increases have not yet made their full influence felt on the price level. If it is then claimed that the increased prices will be justification for increased wages, we shall undoubtedly quickly price ourselves out of the foreign market. If the belief that we can maintain a closed economy becomes general, then I am certain it will lead to the bankruptcy of this country. We could, of course, quite easily control the situation: we could control prices; we could control labour, and we could control materials. But I do not think anyone wants to pay that price, because it would be almost indistinguishable from Communism. We could put 2s. 6d. on the income tax and have a Budget surplus of £1,000 million. But our object is to control the home market, while maintaining the vigour of the industrial machine in the export market.
  The noble Lord, Lord Rochdale, asked how far we can encourage export. It is, of course, difficult. We have resigned ourselves completely to an attitude against subsidies for exports. The Board of Trade Intelligence Service is reasonably good, and I think the rates of the Export Credit Guarantee Department are of some help. But the main thing is to restrict home demand so that goods are not drawn away from export. I feel I can say that our economy has a great deal of vigour. When we are feeling as gloomy as we are—I thought that the

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  noble Lord, Lord Lucas of Chilworth, was particularly gloomy on the export side—it is worth remembering that we are the greatest exporters of textiles, of tyres for motor cars and aeroplanes, of bicycles, of pottery. and, indeed, of electrical machinery; and though the Germans are coming up, I think we can still claim to be the greatest exporters of motor cars. That is apart from our invisible exports, such as shipping, insurance and banking. I mention this because I feel that in our discussions we sometimes get excessively gloomy.
  The main purpose of the Budget, whether the noble Lord, Lord Rea, regards it as uninspiring or not—and I think the significance of the Budget has been a little understated in this debate —is the emphasis on strengthening the capital structure of this country and finding new ways and means of providing capital investment. The first method is a substantial Budget surplus. A figure of £500 million is a considerable one, and it is a powerful disinflationary weapon. That surplus is secured by maintaining revenue, which will equal expenditure both above and below the line if we leave out the new arrangements for nationalised industries; and by reducing expenditure on existing Supply Votes by £100 million —a point which the Chancellor of the Exchequer emphasised—excluding Supplementary Votes, on the one hand, and over and above any windfalls in the form of underspending on the other. So, in fact, it is a genuine reduction of expenditure of some kind.
  I think it is desirable to give an impetus to economy these days; but while I find it refreshing to hear the noble Lord, Lord Coleraine, speak as he does, when it comes to practice, as the Chancellor of the Exchequer said, the old idea that it was expenditure that needed justification, and not economy, just does not exist to-day. Anybody knows that any Bill requiring additional expenditure which comes before this House gets a ready reception, but that the reception of any Bill which requires economy is likely to meet with much more difficulty. Those are the facts on which Parliamentary democracy is working out at the present time. It is for that reason that such a speech as that made by the noble Lord, Lord Coleraine, emphasising the need for reducing taxation, if there is any means of doing so, is of real signi
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  ficance. We should be in considerable difficulty to follow the line he has suggested, because we are pledged to maintain in our structure of life an element of security which I do not think any of us would be without. I am sure that we can only maintain that with a strong economy, by ensuring that anything unnecessary is cut out and by seeing that what is retained is designed for the purpose for which it is intended.
  The noble Lord, Lord Lucas of Chilworth, made an attack on defence expenditure. I think the noble Lord might, at least, have acknowledged the fact that. Service rates of pay have gone up £70 million this year, and the level of Service expenditure has virtually remained static. That, I feel, represents a great measure of careful pruning by the particular Departments concerned. With respect to the noble Lord, I feel that, even in an economic debate, it is proper to say that we as a country cannot contract out of the problems of defence; it just is not practical to view them in that way. After all, it is widely recognised that the strength of N.A.T.O. to-day has added stability to international affairs, and that, in itself, has a great importance on economic affairs. I believe that the Budget surplus of over £500 million, if the Chancellor of the Exchequer is successful, will have a great disinflationary effect.
  The other side of the question is savings, and it is appropriate that forty years after the savings campaign was opened by Mr. Reginald McKenna we should now be putting a tremendous emphasis on savings in this Budget. Your Lordships will no doubt remember that it was Lord Keynes who made the point that if investment exceeded savings there was an inflationary tendency, whereas if savings exceeded investment there was a deflationary tendency. Keynes's great principle was to try and persuade people to cut the cake up, whereas our purpose is to try and persuade the country to bake a bigger cake. Everybody is anxious to spend capital. Hardly a day goes by without someone asking for more roads, railways, ships, or atomic energy, or increased expenditure on the Commonwealth and under-developed countries. But there are not so many people anxious to go through the laborious process of saving money by which this alone is possible. I think it right to pay our tribute to Lord Mackintosh and all those who

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  work with him, because savings are of tremendous importance.
  It is true to say that, during this century, there have been many attacks on the ownership of property. Savings inevitably involve the ownership of property, and it may well be that these attacks have discouraged people to save in that respect. But where are the savings to come from? I am sorry that the noble Lord, Lord Lucas of Chilworth, has gone, because I think he was wrong in saying that the question was not important. I think it is of the greatest importance. Savings cannot come from capital; they have to come from income. There are only two sources of income: one is companies and the other is individuals. The nationalised industries and, indeed, local governments, are all large borrowers and not savers at all. If I take the figures for 1954, which are the latest I have, I find that the total gross trading by companies and public corporations came to about £2,800 million, of which half went in savings, including depreciation. Personal income was about £12,000 million, of which only about £900 million, as a rough figure, went into savings.
  It is clearly in this field that the greatest opportunity lies. When we look at it more closely, we find that 80 per cent. of gross income comes from people with less than £1,000 a year. It is clear that it is from these ranges that the great body of saving must come. It is for that reason that the Chancellor of the Exchequer has taken certain actions, which I am quite sure are widely welcomed. The first is that of improving the rate of return on National Savings Certificates and Defence Bonds, which have been described as the best tools yet for that purpose. The second is by allowing the first £15 of income accrued at Post Office savings banks and Trustee savings banks to be free of income tax. Thirdly, there is the allowance for relief from income tax for premiums paid by a wide range of professional people. That is an improvement for that particular section of the community which is long overdue, and I think it is one which is warmly welcomed to-day, particularly in view of the emphasis which a number of noble Lords have laid on the heavy demands of taxation which fall on that particular section. There is also the reduction of stamp duty on the purchase of smaller
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  houses, which, after all, is probably the best way of saving.
  Finally, there is the subject of premium bonds. I do not think I need say any more about premium bonds, though I am sorry that the noble Earl, Lord Perth, is not here. About three years ago he spoke strongly on the subject, and I am sorry he is not here to express what I am sure would be his appreciation. This subject has been so adequately dealt with by my noble friend Lord Hailsham that I need say only this. I recognise that some people find its acceptance difficult, but I would ask them to look at the scheme. It seems to me that one is not putting blind chance against hard work; one is putting sound savings against hard spending. That is really the alternative, and as such it is so unquestionably to the advantage both of the individual and the State that I feel that those who are worried about it should look rather more carefully at it. I am afraid it is the case that politicians must take human nature as it is and not as they would like it. I think it would be only right that the State should make some bid to persuade people to save something of the £2,000 million which is now spent on gambling, tobacco and alcohol. That is the emphasis which the Chancellor of the Exchequer is laying upon savings, voluntary and involuntary. I think that goes to the root of the problems which we have to-day.
  VISCOUNT ALEXANDER OF HILLSBOROUGH: I do not rise in any sense to criticise what the noble Earl is saying about savings, but perhaps on Tuesday the noble Earl, Lord Munster, who is to speak for the Government, might answer this question. If it is to be so helpful to give relief to those who invest in the Post Office and Trustee savings banks, why is it that inducement is not offered to those investing in thrift organisations other than in these two particular channels? You are going to get a change from one investment to the other and no net increase in saving.
  THE EARL OF SELKIRK: I see the noble Viscount's point. I think the answer is because the rate of interest on Post Office savings and Trustee bank savings is different from that on Defence Bonds. I am not quite clear as to the whole answer, but I think that is one factor which comes into it.
  VISCOUNT ALEXANDER OF HILLSBOROUGH: With respect, perhaps the noble Earl will make a note of it for Tuesday, because we will raise the question of industrial provident societies and friendly societies.
  THE EARL OF SELKIRK: I will do that. The noble Lord, Lord Pethick-Lawrence, raised his favourite subject of money rates. There is a good deal of difference of opinion on this point. There are the classical theorists and the practical operators, who take different views. One of the difficulties is that banking is not an exact science but an art. That is why some of the precise calculations of the classical theorists do not necessarily work out to-day. For this reason the actions of bankers are influenced by what they expect the future to hold. Deposits or advances are not of the same character; they may be different types of deposits or different types of advances.
  The noble Lord referred to Lloyds Bank Review, which questioned the high bank rate as being disinflationary and emphasised the importance of reduction in short-term borrowing, particularly on Treasury Bills. I do not think the Government have ever been under any illusion about this matter. They know that to exercise a disinflationary pressure two things are necessary: first, a high rate of interest, which, of course, on the other side encourages saving; secondly, a relative shortage of cash, which, of course, in turn means funding or replacing Government borrowing by long-term borrowing of some character. That is a course the Government are pursuing now. The Budget surplus is a form of funding. The action of the local authorities in going into the market is another form of funding, and the Government's own long-term issue which is now on the market is also a form of funding. In this sense we agree with Mr. Dacey that excessive short-term borrowing is a decrease of liquid assets, which should be avoided. It is interesting to note that last year the volume of advances did not follow the volume of Bills —that is to say, in the first half of the year, when Treasury Bills were falling, advances increased, whereas in the second half of the year, when the opposite was happening, advances were reduced.
  I realise that there is another force in the second half of the Chancellor's request. He had made a request to
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  banks to check advances, but I do not think it is fair to suggest that the money supply is entirely dominated by the volume of Treasury Bills for sale.
  The noble Lord, Lord Rea, raised the far-reaching question of an inquiry into trade union practices. I think that what the noble Lord was suggesting goes very much too far, but he may be interested in a statement which was made by my right honourable friend the Minister of Labour yesterday in another place. He said that he had raised the subject of what are generally called restrictive labour practices, or what might, I think, be referred to as the best or most efficient use of labour, at the National Joint Advisory Council. The discussions were characterised, he said, by "a constructive and co-operative approach" to this problem, and, if I may quote his words. (OFFICIAL REPORT, Commons, Vol. 552 (No. 144), col. 197):
  "There was general agreement that this is one aspect of the wider problem of increasing productive efficiency…It was also recognised, however, that this is not a subject which can usefully be dealt with by broad generalisations but is one to be examined by each individual industry."
  Accordingly, it was agreed to draw the attention of employers and trade unions concerned in individual industries to the need for a new and positive examination of the practices which impede the efficient use of manpower. The matter has been referred to the Joint Consultative Committee which should be meeting in a few days, and it is hoped that they will carry the discussion a good deal further.
  The noble Lord, Lord Conesford, raised again the question of profits. Here one must emphasise that certain concessions were given in this Budget. There was, for instance, the concession of relief of tax for professional people's savings, and there was the 2s. extra family allowance given for the third child. The Chancellor of the Exchequer felt that he must keep up the surplus at least to the level of over £450 million, and it was therefore with very real regret that he found it necessary to impose some extra taxation. However, I know that that is not really the point that the noble Lord, Lord Conesford, had in mind, which is that he objects to this taxation. He is quite right. He objects to the form which it has taken. I would, however, say this to him: that if that form had not been

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  adopted the situation would have involved drawing together the rates of tax on both distributed and undistributed profits of companies.
  At the present time, when we are trying to answer the rather difficult question that Lord Rochdale put to us, about how we are to encourage people to invest and not to consume, we felt, quite frankly, that it would have been misleading to put what is, in fact, a higher tax on undistributed profits. That is the difficulty. I am quite aware that the Royal Commission on taxation took the opposite view. I do not think we have ever attempted to hide our indebtedness to the work which the Royal Commission have done, or indeed our appreciation of their tremendous labours; but in the present problem of trying to put the emphasis on capital investment the Chancellor of the Exchequer finds it very difficult to take any other line. I was glad that the noble Lord, Lord Rochdale, emphasised the great part which investment allowances played last year. He will, of course, note that we have only suspended them, indicating that we hope that it will be possible in due course to reintroduce them.
  I am also very glad that the noble Lord, Lord Rochdale, referred to the new system of investment for nationalised industries; I think it is an improved system, as the capital of nationalised industries necessarily carries the Government's pledge or the pledge of the community. I am sure it is not the intention of the Chancellor of the Exchequer that all savings should be drawn away from private industries to nationalised industries—I think that is the point the noble Lord was making. I do not know quite how the Chancellor of the Exchequer would do it if he wanted to. But of course, by far the most important thing is that there should be enough savings to provide capital fully and easily for both.
  I am afraid that I did not consider the latter part of Lord Pethick-Lawrence's speech as of quite such value as the first part. I tend to look on the second part of his speech as being rather misleading. He started by saying that he would deal with the cure and cause of inflation. I immediately sat up, and thought, "Here is something which we have all been looking for." But what did the noble Lord say? He said, so far as I could under-
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  stand, that the increase in wages had nothing to do with inflation—he did not use those words, but he implied that one had very little to do with the other. Perhaps the noble Lord will tell us they have something to do with each other. I do not know whether he would like to do that, but I think it would be helpful, because he certainly gave that rather curious impression by the sequence of the words he used.
  LORD PETHICK-LAWRENCE: What I was trying to point out was that one could not expect the working man to forgo his economic advantage unless other people were prevented from taking advantage of their economic position to gain things for themselves.
  THE EARL OF SELKIRK: I take it from that that the noble Lord does acknowledge the situation quite frankly, as he must do; but he started by saying "cure and cause", which rather led rue "up the garden path." The second part of his speech suggested that the real cause of inflation was tax evasion and heavy expenses. I do not really think that the noble Lord meant that, but the sequence in which he put the things left me with the impression that that was the idea he was indirectly trying to convey. I think he knows perfectly well that there is not a shred of truth in that at all. It does not bear a moment's examination.
  We have in this country, I suppose, far and away the most efficient system of tax collection in the world. I do not think there is much doubt about that. Year after year we have brought in new additions to the income tax law which have established beyond peradventure that matters which previously might have been regarded as tax avoidance would in future be regarded as tax evasion. if one looks at the Finance Acts for 1953, 1954, 1955 and 1956, one finds in each of those Acts that various measures have been put forward for the express purpose of stopping what we have regarded as violations of the spirit of the income tax law, though they may well have been matters within the letter of the law as such.
  The noble Lord also said that he thinks expense allowances are unreasonably granted by the income tax people. 1 have never found that people who have tried to explain their claims for expenses allowances on the basis that they were incurred

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  "wholly, exclusively and necessarily for the performance of the duties" say that they thought the Inland Revenue officials were unduly lighthearted about that. I think most people have found that the Inland Revenue people are pretty "tough" in their interpretation of expenses. I am not, of course, prepared to say that unscrupulous statements are not made which it is difficult to disprove. There may be some from time to time, but I do not think that is at all a widespread practice. I would say that expenses for entertainment, in the sense in which the noble Lord uses the word, are part of the economic structure of this country, and that in the ordinary way of business entertainment should play a part. I have very little reason to question that this is reasonably or fairly taken. It would be absurd to be unnecessarily extravagant or, on the other hand, parsimonious to the point where relations and proper contacts could not take place; but examining individual cases I think the noble Lord would find that the present arrangement is far from being unreasonable and unfair. I cannot help wondering whether the noble Lord is not thinking of some words of the Royal Commission who went so far as to say that
  "In times of high taxation they are apt to produce on an individual the impression that every advantage in which he does not share is itself an abuse."
  I do not think that is necessarily the case here at all.
  The noble Lord, Lord Rea, mentioned travel allowances. I can only say that that matter is answered by the statement that the time has not yet come when they can be dealt with. I do not want the noble Lord to think for one moment that we do not regard with the utmost sympathy the importance, culturally and educationally, in the widest sense, of the points which he has made. Speaking quite personally, and without any authority, I always feel particularly that is so of North America and our great Commonwealth relation, Canada, which it is so difficult for people to visit.
  LORD PETHICK-LAWRENCE: Before the noble Earl passes from this subject, with regard to my question about whether the Treasury were looking into this very considerable avoidance of surtax with a
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  view to taking some steps, do I understand him to say that he considers that no further action is required?
  THE EARL OF SELKIRK: The noble Lord speaks of "these facts", but he never gave one single fact on this aspect of the matter. I can assure him that this matter is being constantly looked at at the present time, and facts given in every way are always looked at. There were some facts given about other subjects, but, if I may relieve the noble Lord's mind, when I asked for an explanation of the facts they were shown to be without any foundation whatsoever. The noble Lord may rest assured that this is a matter which is gone into continually; it has been examined, and reexamined, from the statement made on facts. I cannot see that there is any particular reason for going into it on a wider or broader basis than that which exists at the present time.
  I am afraid I have not answered all the questions which have been raised. I will end simply by saying this. I believe that this Budget is based on a sound foundation from which we can proceed to renewed strength in our economy. It is a complicated arid difficult subject. It is very hard for the great body of the people of this country to understand the narrowness of the margin by which we are living when they see all around them outward and visible signs of prosperity. It is difficult for them to understand it. It is difficult for them to appreciate the essential causation between better capital investment and a higher standard of living, while individually, perhaps, they may be losing their own jobs or moving from one employment to another.
  We all believe that we must make ourselves masters of our own economic circumstances. That fact has often been emphasised, particularly by Socialist speakers. But I do not think any of us wants to do it by putting the exclusive responsibility in the hands of the Government. If that is done, then the Government must ask for power. It is therefore especially necessary to-day that the broad issues should be understood as widely as possible. Everyone welcomes the steps which the Prime Minister is taking in meeting the leading members of the big trade unions and industry to try

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  to see that these problems are as widely and fully understood as possible. But, of course, it is not only on the Prime Minister that the responsibility of making the position clear falls, because whether we succeed now, with all the immense potentialities which that involves, will depend on whether or not the great body of people accept the nature of the problems confronting them and are prepared to make their contribution.
  THE EARL OF LUCAN: My Lords, on behalf of my noble friend, Lord Winster, I beg to move that the debate be now adjourned.
  Moved, That the debate be now adjourned.—(The Earl of Lucan.)
  On Question, Motion agreed to, and debate adjourned accordingly to Tuesday, May 8.

  LEICESTER CORPORATION BILL
  Returned from the Commons with the Amendments agreed to.
  UNDERGROUND GASIFICATION
  UNDERGROUND GASIFICATION